South Lake Tahoe City Council to consider MOUs on Loop Road affordable housing efforts

South Lake Tahoe City Council to consider MOUs on Loop Road affordable housing efforts

City Council on Tuesday will consider two memorandums of understanding that staff say will give the city a more prominent role in the development of affordable housing related to the U.S. 50 South Shore Community Revitalization Project.

More commonly known as the “Loop Road” project, the U.S. 50 highway realignment project involves the demolition of as many as 76 housing units in the neighborhood west of the Crescent V Shopping Center in South Lake Tahoe.

As a requirement of the project, the Tahoe Transportation District — the lead agency on the project — has agreed to construct 109 units of replacement housing. Of those 109 units, 102 will be deed restricted for low-income people, while the other seven will be deed restricted for moderate-income people. Council will consider entering into two separate MOUs with TTD and two different affordable housing developers.

The MOUs, according to a staff report, signal the city’s willingness to work cooperatively on the development of affordable housing units on five parcels controlled by one of the developers, Pacific Development Group, and on one parcel controlled by the other developer, United Housing Corporation.

It also indicates an intent to pursue further development of affordable housing units near the housing units that will be destroyed as a result of the Loop Road project. As staff explain, the MOUs mark the first step in the affordable housing process. “Formal decisions on project sites, scopes, designs, etc. will be included in formal development agreements, and will be presented for formal City Council consideration in the future after additional project planning progresses,” states the staff report. However, the MOUs are not free of controversy in the eyes of some residents who oppose the Loop Road project. They lobbied council to delay a decision on the memorandums at the Aug. 6 meeting.

Duane Wallace, husband of Councilor Tamara Wallace, and former Councilor Bruce Grego were among those who requested council delay a vote on the MOUs until a future meeting. The request was in order to give the public more time to evaluate the MOUs and to allow for more participation in the discussion.

Mayor Brooke Laine was absent from the Aug. 6 meeting for personal reasons. With Mayor Pro Tem Jason Collin recusing himself from Loop Road discussions because he owns property in the area, only three councilors were present to discuss the MOUs at the Aug. 6 meeting.

Councilor Wallace, prior to any public comment, requested the issue be delayed so that Laine could participate in the discussion.

Members of the public expressed concerns that the MOUs effectively represented the city’s endorsement of the controversial Loop Road project. The project proposes realigning U.S. 50 behind the casino corridor and the Heavenly Village area. The newly aligned highway would cut through the Rocky Point neighborhood to connect back into the current U.S. 50 alignment just west of where Pioneer Trail currently meets the highway.

The project, in various iterations, has been debated for decades. In 2018, the Tahoe Regional Planning Agency approved environmental review documents for the project, which represented a major milestone.

But voters in the city have expressed a desire to have a greater say in the project. In 2016, nearly 60% of voters passed a ballot measure, Measure T, that would put any city decisions on the project to a vote of the people. The measure was struck down in court, and several appeal efforts were unsuccessful.

Despite those concerns about the MOUs, city attorney Heather Stroud told council at the Aug. 6 meeting that the agreements only pertain to the affordable housing aspect of the project. The MOUs do “not express the city’s approval or support for the project as a whole,” Stroud said. Councilor Cody Bass, who serves as the city representative on the Tahoe Transportation District board, made similar remarks, stating the intent was to give the city a say in the development of affordable housing — a critical issue in the city and around the lake. TTD almost approved MOUs with the development companies earlier this year, Bass said. At the request that the city be included, new MOUs involving the city were drafted. TTD was planning on considering the MOUs after council’s Aug. 6 meeting. However, TTD Director Carl Hasty told council he would recommend the board delay a vote until its September meeting so that council could continue the issue until its Aug. 20 meeting. Local attorney Lew Feldman, who was representing Pacific Development Group, said the group did not oppose continuing the conversation to Aug. 20.

Several community members, including Tahoe Chamber CEO Steve Teshara, spoke in support of the MOUs and affordable housing effort.

City Council is scheduled to meet at 5:30 p.m. in council chambers at the Lake Tahoe Airport, 1901 Lisa Maloff Way.

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