Takin’ care of business: After period of dormancy, Tahoe City eyes future
July 7, 2014
This is the fifth in a five-part series of stories that takes a look at rising trends and the current state of business in the North Tahoe and Truckee region, as we count down the days before one of the biggest business weekends of the year, July 4-6, 2014.
— Read part one about the growing number of telecommuters, freelancers and coffee shop workers at Truckee/Tahoe.
— Read part two about how a trio of new co-working spaces at Tahoe/Truckee are offering more affordable office options.
— Read part three about the current state of business in the town of Truckee, and how officials are cautiously optimistic for the future.
— Read part four about the how the Tahoe/Truckee region is becoming more attractive for tech jobs and startup companies.
TAHOE CITY, Calif. — After Brendan Madigan became owner of Tahoe City's Alpenglow Sports on Dec. 1, 2011, changes were made to the long-standing business to keep it pertinent.
"We have done a lot of, I would say modernizing, because it was an older business," Madigan said of the 34-year-old establishment. "It needed a bit of lovin,' and we've done a lot in that capacity to be relevant and to stay relevant."
Madigan renovated the store at 415 North Lake Blvd., making the space larger with new floors, fixtures and lighting. The business's online presence increased, as did its involvement in community events.
Upgrades are key to the success of Tahoe City and the greater North Shore, said Sandy Evans Hall, executive director and CEO of the North Lake Tahoe Chamber/CVB/Resort Association.
“You’ve got to have evolving businesses — otherwise, you start to die.”
Sandy Evans Hall
North Lake Tahoe Resort Association
"We need renovation, and I think right now we're seeing some of that happening," she said. "… You've got to have evolving businesses — otherwise, you start to die."
On the east side of town, the Lighthouse Center is undergoing renovations, which will include a new roof, utility replacements and ADA upgrades.
Yet, as a result, all the businesses there — aside from the U.S. Post Office, Better Homes & Gardens Real Estate and Safeway — have been displaced
"It's always difficult for businesses to have to find other locations, but you have to look well into the future that you're going to have a much more attractive retail center, hopefully, in the end, and that retail center will bring in other businesses," Evans Hall said. "Maybe some of those businesses will go back into that center, but it could be you get (all) new businesses that come in … and bring in some excitement to the area."
'ON A REBUILD RIGHT NOW'
According to the Placer County assessor's office, while statistics on number of businesses that open vs. those that close are not kept, 38 new businesses were assessed in Tahoe City in 2013, while 24 business assessments ceased.
James Lambeth, chief appraiser, noted the office doesn't always receive notice on arrivals and exits in the year they occur, making adjustments as received in subsequent years. In addition, new businesses that don't have sufficient property to assess are not counted.
A new business to Tahoe City this year is Moe's Original BBQ, which opened at 120 Grove St. in Tahoe City on June 21.
"We definitely feel that Tahoe City is on a rebuild right now," said Josh Wallick, co-owner and pit master, while prepping food for customers last Friday. "There's no better time to be here."
Part of that rebuild is through planned public investment, such as the Highway 89/Fanny Bridge Community Revitalization Project at the "Wye." Further, private investment such as renovations to the former Cobblestone Cinema and converting the downtown Henrikson Building into a high-quality hotel are in the works.
"(An upscale hotel) that's something we're missing here," said Stacie Lyans, executive director of the Tahoe City Downtown Association. "It might drive some visitors to our town that are only looking to stay at a certain class of hotel. You can find those types of hotels in Northstar, Squaw, but you don't find too many upscale or boutique hotels along the lake, so that's a niche that if we can put in, I think that would really help our town."
Since 1962, no new hotels/motels have been built in Tahoe City or Kings Beach, according to Placer County staff. The cost to develop lodging inside the basin is roughly $100,000 more per room, driven by environmental regulations; restrictions on height, density and land coverage; seasonality of the market; and land cost.
While Vicky Biggs, owner of Vicky's Cyber Cafe and InnovativeIT Services, sees the benefits of a high-end lodging establishment to Tahoe City, it also worries her since her businesses are housed in the Henrikson Building.
"I'm just not going to jump the gun before it's necessary," she said. "I love my space. It has the best parking in town. It's a little off the path, but I'm fond of it, I have to say. I will have to find a new place probably at some point. … If I don't find somewhere, I'll have to close, too. That's scary, definitely."
'A GOOD PLACE TO LIVE'
Yet, community improvements like those planned for the Henrikson Building are a good thing, Evans Hall said.
"If you are in a marketing business like we are, you want to make sure your product is continually evolving and getting better, so you can have something to sell," she said. "That's what we're selling — the product of North Lake Tahoe. We want to see the investment happening by the ski areas, by private investors, by public investment because that then lets us tell that story of 'you came to Tahoe two years ago, but you've got to come back because it's changed.'"
NLTRA spends close to $2 million in marketing the North Shore through public relations, social media, TV, web and print, Evans Hall said.
"Once (visitors) get here, it's up to Tahoe City to try to get their share, it's up to Kings Beach to get their share, Northstar … everybody else can fight over that market share," she said.
That's where local businesses associations play a key role, Evans Hall said.
"Our job as the Tahoe City Downtown Association is to make sure businesses are thriving, visitors come here and this is a good place to live, work and play," Lyans said.
TCDA does that by ensuring the area remains clean and well-maintained and by putting on local events to attract visitors.
Last year, $889,035 was collected in Tahoe City sales tax revenue, with Squaw/Alpine having the next highest collection at $446,021, according to Placer County. In 2012, Tahoe City had $837,269 in sales tax revenue, and $809,219 in 2011.
'HELD ON FOR THE RIDE'
These signs of growth come as the region begins to rebound from the Great Recession.
"The biggest thing in the middle of the recession is people were holding onto their money and not willing to make investments," said Gary Davis, TCDA president and owner of the Gary Davis Group. "They didn't know where we were going. There was a lot of fear, so people who had money weren't making investments, and a lot of people didn't have money because they didn't have jobs."
According to the county, $898,339 in sales tax revenue was collected in Tahoe City in 2008, down from $960,775 in 2007. That downward trend continued in 2009, with $743,077 collected, before a slight uptick in 2010 with $755,079.
"It was very, very difficult on a lot of our local folks," Davis recalled. "We lost businesses during that period."
In 2008 in Tahoe City, 72 business assessments ceased, while 80 new businesses were assessed, according to the assessor's office. In 2009, those numbers were 80 and 74, respectively, and 70 and 66, respectively, in 2010.
"Everybody retrenched, got under the rock, pulled the covers over their head and held on for the ride," Davis said.
'THE FOUNDATION IS THERE'
The Gary Davis Group, which has been in business for 25 years, weathered the recession by reducing staff and cutting costs, while Alpenglow Sports bought inventory more conservatively and focused on customer service.
"I think there's been a very pronounced dormant period from both property owners and managers of maintenance renovations because it's expensive and there's some hurdles with the county and the TRPA (Tahoe Regional Planning Agency) to make those investments show a return, and if there isn't a return, you don't do them," Madigan said.
In late 2012, TRPA approved its updated regional plan — albeit currently embroiled in a federal lawsuit with the Sierra Club and Friends of the West Shore — affording town centers such as Tahoe City a greater opportunity for redevelopment.
"I think TRPA's new rules, once they get through all the courts, will help us deliver a little better product, and that's not just for tourists — it's for locals, too," Davis said.
Placer County is also working on a Tahoe Basin Community Plan Update, which will serve as a guide for future development on the California side of Lake Tahoe's North Shore. Among the objectives is investing in and revitalizing existing town centers through policies, guidelines and actions.
"For a long time, people were saying, 'Tahoe City is dead,' but I've been involved in a successful business here for 11 years, and while we have some missing components, the foundation is there," Madigan said. "This is a wonderful town that can only get better."
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