This is a ballot measure - Measure N - proposed for the City of South Lake Tahoe that will appear on the November general election ballot. It raises taxes by $6,000 per year (and increasing annually) on homes that are not occupied at least 183 days per year with almost no exceptions, while not guaranteeing any funding for important community needs like fire protection, public safety, parks, bringing jobs to the city, snow removal, affordable housing, filling potholes, or transit.

No! Backers of the measure claim it will help, but how could increasing taxes on homes make them less expensive?

Not at all. In fact, if you read the proposal carefully, you will find that there is no guarantee in this measure that one penny of new funding will go to housing programs. And there is no guarantee that the funding from this measure will produce a single new unit of affordable housing in the City.

Housing affordability is a critical issue for South Lake Tahoe, but this proposal is not the answer. Housing affordability is a Tahoe Basin-wide and indeed statewide issue in California. The issue is further challenged by environmental constraints in the Tahoe region. That said, the State of California just awarded South Lake Tahoe as one of the few communities in the state with the coveted “Prohousing Designation” which gives us access to additional grants and incentives to further address our housing needs. And we’re all excited to welcome the first residents into Sugar Pine Village this fall, a 248-unit mixed use and affordable housing development. We all want to address housing affordability, but a bad proposal like this tax is not the answer. Collectively, the organizations in the No on Measure N campaign have done more to bring new homes into South Tahoe than the backers of the Vacancy Tax.

The backers of the measure say it will raise up to $34 million per year. And while their math is a bit suspect, if you accept their calculation, that is a HUGE tax increase. The City of South Lake Tahoe’s budget is just over $50 million per year, which means this is an almost 70% increase in the city budget. And the City of South Lake Tahoe just announced they have both a surplus and a rainy-day fund. What government entity needs a 70% budget increase?

That’s the $34 million question! First, it’s important to repeat that there is no guarantee in this measure, despite what the proponents say, that any of this money will go to housing issues or produce a single new unit of affordable housing. The measure lists five categories of funding allowed for the tax. The only two that are guaranteed, by common sense, is that the funding can be spent on setting up the likely huge new bureaucracy needed to establish, enforce, audit and administer the tax; and that the money can be spent on lawyers for the legal defense of the measure. After that, the tax is allowed to be spent on transit programs, transportation infrastructure, and housing programs. But again, those three categories are allowed, but no funding is guaranteed for any of them.

No, the discretion over how to spend the money is entirely left up to a future City Council. The voters have no direct control over the tax. And while the measure claims to establish an Oversight Committee, this Committee is appointed by the City Council they’re supposed to oversee, and nothing stops the Council from appointing their friends and political allies to the Committee. The Committee members can also be fired by the City Council they’re supposed to oversee. What’s more, the measure does not require the Committee to do any oversight, and whether they provide any recommendations or no recommendations, the City Council is free to ignore them and do whatever they want.

Not really. The same future City Council controls both the City General Fund and Vacancy Tax Fund. As mentioned, the first call on money from the tax will go to administer the tax, which could be ALL of it. After that, nothing in the measure prevents the City from, for example, cutting the current General Fund spending on pothole repair, backfilling that with money from the Vacancy Tax, and then spending the General Fund however they want. In this example, the amount spent on pothole repair doesn’t increase at all. It’s classic Bait & Switch!

No. And let’s be honest, the City doesn’t have the best track record of keeping promises to voters, and we have no idea what a future City Council might do.

No. That is a lie.

Yes! There are over 16,000 homes in South Lake Tahoe, and the City would have to set up a huge new bureaucracy to keep track of each of these units. That includes processing the annual proof that each resident or owner must submit to the City. It includes doing random audits of these homes and monitoring your utility usage. It could include the city responding to anonymous complaints that a home is vacant. The measure leaves completely open-ended how the City will enforce and administer the tax. The City has not and will not tell us how they intend to enforce this program until after Measure N is voted on.

Taxpayers, including second homeowners, will. While the bureaucracy will be paid for by the new tax, doesn’t that defeat the purpose? It could literally be a tax that pays for the administration and collection of the tax. How does that help anyone?

The City will only have three choices, none of which are good. The first bad choice will be to cut other vital city programs like fire protection, paramedic response, police protection, parks, road repair and more to devote resources for setting up the new bureaucracy. The second bad choice will be to borrow and go into debt, meaning potentially years of the new revenue will just be to pay back the set up and legal costs. The final bad choice will be to use up all the city’s reserves and rainy-day fund, meaning we’ll have no plan if there’s another crisis. And if, after having made one of these bad choices, a lawsuit voids the tax, taxpayers will be out all the set-up costs spent.

That’s correct! The measure specifically states that the burden is on the owner to prove to the City that the home was occupied, and if you don’t file the proof, the city will assume your home was vacant and is subject to the tax. It’s a huge invasion of privacy!

At least 5 years! The measure authorizes the City to go back up to five years to audit you and require you to prove you lived in your home or that it was occupied by another person. Think about that...are you sure that you could quickly and easily come up with the proof, to satisfy a government bureaucrat, that your home was occupied for 183 days in 2019? It’s not as easy as you think, and even if you can come up with the proof, why should you have to spend dozens of hours proving this?

Great question! The owner of the unit is responsible for paying the tax if the unit is vacant, so they will have to force their renters into some program to prove the unit was occupied for 183 days. Just having a lease is not enough, because the measure says the housing unit must have a “natural person” occupying it for 183 days. To avoid the tax, your landlord will have to monitor your daily occupancy. So, let’s say a renter leaves town for several months for work or other life circumstances, but still pays their rent in Tahoe and wants to return. That unit is still subject to the tax! Will the landlord pass the tax on to the renter? Can they evict you in favor of someone who promises to occupy the unit full time? This measure is so poorly worded, no one really knows, and that’s another reason to VOTE NO!

South Lake Tahoe has always been a community that thrives when we celebrate the contributions and value everyone who loves this special place, be they full-time residents, part-time residents, or visitors. Our economy depends on the extra money that visitors and part-time residents bring, and any shopkeeper or restaurant owner will tell you that these folks spend more when they’re here. That creates jobs and tax revenue for locals. Many of the second homeowners in South Tahoe are deeply involved in this community. This measure throws all that out the window and divides full-time residents from others and blames them for our statewide and regional challenges. That doesn’t make us a very welcoming community and hurts local jobs and our small businesses and economy.

This measure treats all second homes the same, regardless of the size, the value, and the circumstances. Despite the picture proponents want to paint, many of the second homes in South Tahoe are small, one-bedroom condo or A-frame homes that a middle-class family scrimped and saved for, so they could come here as often as they can. Many have been in a family for generations. Others are owned by retired people on fixed incomes. For many of these folks, who love South Tahoe, $500 per month is a lot of money. Even if they stay here five months a year, they’d pay this tax. At the same time, a five-bedroom house on the lakefront owned by a wealthy person who only uses it a few weekends a month would pay the same tax. That’s the definition of unfair.

It makes no sense to assume that increasing taxes on housing would lower the cost of housing. For those renting in a multi-unit housing building, if the landlord has any units subject to the tax, they’ll pass that tax on to the other units in the building. It will also lower visitor spending in the city which will cut jobs and hurt workers. And your landlord will monitor your residency and could pass on the tax to you if your fail to provide proof you lived in your home.

It’s not likely. Think about it. For the second homeowners who are wealthy, they’re not going to rent out their house; they’ll just avoid or pay the tax. For less wealthy owners, they’re more likely to sell than rent their unit, and the buyers of these homes will be, again, wealthy people who can afford the tax and won’t rent it out. There’s also no promise in this measure that any second homeowners who rent their house out will do so at a rate lower than what’s currently on the market. Remember, the owners of these homes want to use them when they visit, which is why they bought them. If they wanted to be landlords, they’d likely do that someplace else. It’s also important to note that many HOAs in Tahoe don’t allow homeowners to rent out their houses. Finally, don’t forget that many of the same folks behind this proposal were also behind Measure T, which they also said would help convert STRs to affordable rentals for locals. And even if you are happy that STRs are out of neighborhoods, there’s no denying that Measure T, like this measure, failed to address housing affordability.

Who knows what the future may hold? Life has a way of throwing us curveballs, and this measure will bite you when life happens, despite your current intentions. If you get a temporary job assignment for a year out of the area, and don’t want to rent your house out to a stranger, you would be subject to the $6,000 tax. If you have a parent or grandparent in the Bay Area who needs care for a year and you move there to be with them, your house is deemed “Vacant,” and you get a $6,000 bill! Finally, the proponents of the measure wrote it so that it takes a simple majority of the City Council to expand the tax, but a two-thirds majority to narrow the tax. Why do you think that is?

Sugar Pine Village cost over $800,000 per unit to develop, and that was with free land and other concessions from the state. In California, the average affordable housing project costs over $1,000,000 per unit to develop. So even under the wildly optimistic and almost surely false assumptions made by the proponents, this measure would provide about 30 new units of new affordable housing a year. This is just a drop in the bucket. Housing affordability is a decades-long, statewide issue, and needs a statewide solution, not a divisive, unfair and unaccountable housing tax in South Lake Tahoe.

Not even close. They’re basing this claim on a flawed City study that even they agreed was full of assumptions that didn’t make sense. From that flawed study, they cherry-picked numbers, assumed no downside visitor spending from a $34 million tax, and manufactured a false conclusion that somehow a huge tax increase will help local businesses. It’s as simple as this, every leading small business organization in South Tahoe, including the Tahoe Chamber, the South Tahoe Chamber of Commerce, and the South Tahoe Restaurant Association oppose Measure N, because they know it’s bad for local businesses.

Not well so far. Taxes like this are new to the United States, and every one that has passed in California is recent and subject to active litigation. But in places like Vancouver, Canada, there have been many examples of people being accused of violating their vacancy tax who occupied their homes and had a hard time proving it to the government. And similarly to South Tahoe, some ski-oriented cities in the Austrian Alps have abandoned vacancy taxes after a few years because the cost to administer them was greater than the tax collected.