South Lake Tahoe Residents Vote Against Taxing Wealthy Interlopers

The presidential election wasn’t the only outcome on people’s minds on Wednesday morning—especially in South Lake Tahoe, CA.

Residents there voted against Measure N, which would have levied a $3,000 tax on homes that are vacant for 182 days or more throughout the year—and that tax would have increased to $6,000 in subsequent years.

Proponents of the measure had argued that empty second homes in the city have exacerbated the city’s housing crisis by leading to a decrease in available affordable rental units—and said the measure would raise millions for housing, road repair, and public transit.

But detractors had argued that the government shouldn’t have a say in how many days you spend or don’t spend in your own property.

As of Wednesday afternoon, 73.8% of residents had voted no on the measure. (There are still votes left to count, but El Dorado County election officials won’t give an update until Friday.)

“Measure N was a horribly flawed and divisive proposal that would have done nothing to address housing challenges in our community and everything to further acrimony in our community. The voters saw it for what it was and rejected it soundly,” said Sharon Kerrigan, executive vice president of the South Tahoe Association of Realtors and co-chair of the Stop the South Tahoe Vacancy Tax campaign, in a statement.

Kerrigan also told Realtor.com® that “people are telling us that they are grateful that they won’t have to deal with an invasion of privacy and an onerous bureaucracy that would have been necessary to implement such a tax on all residential properties in the city.

“Second-home owners are telling us that they are grateful that they won’t be forced to sell or rent their cabins in South Lake Tahoe,” she added.

Many vacation-home owners were ineligible to vote in the election because their second home in South Lake Tahoe isn’t considered their primary residence.

Kerrigan says it’s the mission of Realtor® associations at the national, state, and local levels to protect private property rights and to serve as the voice for real estate, especially for those unable to vote themselves.

“Thank you to all the voters who voted against it and for being a voice for those of us who own second homes and were not allowed to vote on the issue,” wrote Teresa Barnwell on Facebook.

However, Measure N supporter Nick Speal told SF Gate that thousands of people are still saying they want more to be done to solve Lake Tahoe’s housing crisis.

Search for solutions continues

Currently, the median rent in South Lake Tahoe is $2,600 per month—$857 more per month than the median asking rent in the 50 largest metros. That means South Lake Tahoe voters pay $10,284 more per year than the average renter.

And the median listing price is $632,500, which is $133,000 higher than the national median.

Meanwhile, the median household income in South Lake Tahoe is $68,000, which is $27,000 lower than the California median.

South Lake Tahoe also has roughly 7,000 vacant homes—which make up 44% of the city’s estimated housing units, according to the 2022 American Community Survey.

“We’ve said from Day 1 that the issues raised in this campaign are real, but the proposed solution was never going to work,” said Steve Teshara, director of government relations for the Tahoe Chamber of Commerce and co-chair of Stop the South Tahoe Vacancy Tax, in a statement.

Kerrigan hopes that, with such an overwhelming defeat, “we can now turn as a community to brainstorming and working on more viable solutions for challenges we face, including workforce housing, road repairs, and area transit.”

She remains hopeful that “we can reach compromises that will address the needs of everyone in the community that won’t single out and target just one segment the way that Measure N would have,” added Kerrigan.

Amelia Richmond, who co-authored Measure N, told Realtor.com that “having 44% of housing units sit unoccupied most of the year in South Lake Tahoe has seriously impacted the housing crisis”.

“While nearly half of all homes sit empty, local workers are struggling for housing and businesses are struggling to find staff. It was important to me to try to stop South Lake Tahoe from following in the hollowed-out footsteps of Tahoe City’s North Shore, where the vacancy rate is now 70%,” she said.

Richmond added that “community matters now more than ever”.

“We believe in a vibrant community where locals who work here can afford to live here … our fight for affordable housing is not over, and we look forward to joining forces with community members on both sides of the Measure N debate to work towards solutions.”

Playground of the rich

South Lake Tahoe—and Lake Tahoe in general—is a favorite spot for the elite.

Many celebrities have called Lake Tahoe home—including Cher, Liza Minnelli, Alanis Morissette, and Frank Sinatra.

And right now, Meta CEO Mark Zuckerberg is building a colossal compound on the shores of Lake Tahoe.

In 2018 and 2019, he bought two properties in the area for a combined $59 million and has been renovating them ever since.

Other tech titans who own Tahoe property include Larry Ellison, co-founder of Oracle, and David Duffield, co-founder of PeopleSoft.

In fact, Forbes reports that over 30% of new buyers in the area are from the tech industry.

But not everybody’s happy about it.

Sabrina Burge, manager of a Lake Tahoe cafe, told the San Francisco Standard she worries that billionaires building mansions on the lake will attract more wealthy homeowners to the area, driving up listing prices and making it more difficult for locals to buy homes.