Squeezed Out: How To Build Affordable Housing In Tahoe

May 26, 2016

The Artist Lofts, in Truckee's proposed railyard development, will include 66 affordable housing units.

In our  ongoing series, "Squeezed Out," on the housing shortage in Reno and Tahoe, today. In this final story, our reporter Amy Westervelt looks at potential solutions in Tahoe and Truckee.

That train whistle is the soundtrack of Truckee. So it's only fitting that the first new downtown development in years is at the site of the old railyard. I'm here with Truckee Mayor Joan DeRyk Jones.

“This is Church Street, and we’re standing on the future site of the Artist Lofts. Eventually to the West there will be a theater and retail component.”

The first building in the project – the Artist Lofts – will include 66 affordable housing units. It was unanimously approved by the town council earlier this month.

Jones is excited about the project, but says it isn't a silver bullet.

“I was born and raised here. It’s always been an issue. When I was growing up, you couldn’t own a home if both parents didn’t work. So it’s always been a problem, and it’s just something that we always need to be working on.”

As an incorporated town with local planning oversight, Truckee is actually an easier place to build affordable housing than the rest of the Tahoe basin. Meea Kang, head of Domus Development, explains.

“It's too hard, it's too complicated, it's too expensive. We had to go through 12 entitlement processes. And then we had to jump through everyone's hoops.”

In 2012, Kang built 77 affordable housing units in Kings Beach, spread across six sites. But back then California had a redevelopment agency. Without the incentives and subsidies that agency provided, there’s little reason for a developer to build low-income housing in Tahoe.

“The reality of affordable housing is that it's really expensive to build and you can't get the return on rent or selling it that you could on a market-rate development," Kang says. "So something, someone has to fund the gap.”

According to Jesse Patterson, deputy director of the League to Save Lake Tahoe, replacing older, rundown buildings with new, denser developments, isn't just good for local residents. It's also good for the lake.

“We just have all these old, blighted buildings that are polluting the lake.”

The League pushed for the inclusion of redevelopment credits in the Tahoe Regional Plan, drafted in 2012, but historically it’s been one of the biggest opponents to development in the region. Meea Kang explains.

“Everyone told me, you’re gonna get sued, you’re gonna get sued, there's no way you can do this. There hadn't been a recent real estate project proposed that hadn't been sued by the League to Save the Lake."

Patterson says these days the League is trying to be more of an ally to developers. He's looking forward to the review and update of the plan that's due to happen next year.

"It looks like, from what we're seeing, there are still some barriers. Maybe it's too complicated. Perhaps the incentives aren't good enough, I think it's too early to tell."

Another change being discussed in the region centers around permitting and tax laws that make it difficult for property owners to build small. Theresa May Duggan, known in the community as Tee May, would like to replace her crumbling beach cottages in Kings Beach with new, tiny houses. But she's hit various roadblocks.

"Knock, knock! Hello! How are my kids? Oh my god, it's so clean in here"

"Ha, no it's not."

Tee is introducing me to Daniel and Flor, a young couple that lives in one of her cottages. They're making coffee while Tee shows me where a wall used to divide the living room from the kitchen. Flor says they struggled for two years to find a place they could afford.

"The only places available were so big and expensive we would have had to have roommates. And we were newlyweds. We didn't really want to have roommates."

They were just about to give up when Daniel saw Tee's listing on Craigslist. Tee says she'd like to continue renting her places to what she calls "real people," but she'd like to see some changes to local policy that make that more feasible

"There's a 4,000-square-foot lakefront house across the street. We pay the same amount for fire protection."

If cottages like these are no longer an option in Tahoe, many local employees like Daniel and Flor, who work at Squaw and at a boutique in Truckee, will be forced out.