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Solimar Research

Nevada Threatens Secession from Tahoe Compact

Jun 14, 2011

Last week the Nevada Legislature—usually not an entity with much to say on California land use—issued a decision that would make King Solomon blush. 

After 31 years as a supposedly equal party in the Bi-State Compact governing the Lake Tahoe basin, Nevada has taken its first steps towards pulling out of the Tahoe Regional Planning Agency and thereby negating the agreement under which the two states have governed and managed Lake Tahoe and the surrounding basin. 

The original version of Nevada's Senate Bill 271, sponsored by Sen. John Jay Lee of the Las Vegas area, called for Nevada to essentially abrogate the compact upon signing by Gov. Brian Sandoval. The version that passed at 1 a.m. on June 8, the state's legislative deadline, instead outlines Nevada's demands on TRPA – a change in the governing structure and passage of its long-overdue regional plan update. If those demands are not met, then the state could initiate withdrawal two legislative sessions from now, in 2015. (Lee did not respond to requests for comment.) 

Many in the environmental community in both California and Nevada fear that the bill—which Sandoval is expected to sign—undermines environmental protections and will lead to development. Even the mellowed version that was passed, they say, essentially holds TRPA hostage to Nevada's interests while denying the unavoidable conflict that arises when two sovereigns share a single resource. 

"What was recognized when the TRPA was created is that it's just not feasible to deal with each side of the lake," said Schladow. "What happens in California has an impact on Nevada and vice-versa."

SB 271 makes two major demands to avert Nevada's secession from the compact. It first requires that TRPA pass a long-overdue update to its regional plan. It also would profoundly change the agency's governance by altering the voting structure among its 14 board members. 

      Currently, to adopt, amend, or repeal environmental threshold carrying capacities, the regional plan, or ordinances requires a supermajority of nine votes, with at least four yeas coming from the state in which a plan or project is located. SB 271 requires TRPA to abandon the latter provision if Nevada is to remain a party to the compact.   

Even though SB 271 calls for the update of the regional plan, some predict that Nevada will try to exercise power by refusing to approve any plan that does not meet the state's stated needs. Therefore, TRPA will either have to adopt a plan favorable to Nevada or automatically face dissolution. Therefore, TRPA is between a lake and a hard place. 

      "That does not seem like a reasonable demand by Nevada," said Rochelle Nason, executive director of the League to save Lake Tahoe. "As a consequence, we're concerned that it will not be possible to salvage TRPA."  

Though Nason said that TRPA is crucial for protecting the lake, opponents of SB 271 say that TRPA itself did not forcefully protest its own demise. TRPA Executive Director Joann Marchetta appeared at the initial Senate hearing, but agency staff did not take an official position on the bill. "The conservation groups had to defend the TRPA," said Ann Nichols, president of the North Tahoe Preservation Alliance. 

TRPA External Affairs Director Julie Regan said that staff were not free to take a position in the absence of direction from the board; Marchetta was not available for comment. 

"Our board never took a position, and we have differing opinions on the board," said Regan. "It would not have been appropriate for us to take a position when the policy makers on the board did not take a position on the bill." 

Instead, Regan said that the law presents a valuable opportunity. 

"We are hopeful that this legislation will allow enhanced dialog between the states of California and Nevada," said Regan. "Sometimes there are just different ideas about the best path to get there and this bill is one example that those differences are coming to a head." 

As well, some say that this reticence symbolizes the problems that plague TRPA, have held up the regional planning process, and thus made the agency a target for the Nevada Legislature. 

"TRPA not being present for this discussion is like a miniature version of TRPA sitting on the regional plan for 5 years," said Nason. "In the absence of consensus on their board, they can't act. The whole purpose of a board—and a diverse board like this—is to build consensus but also to make decisions. The board never voted not to take a position, and it never voted to take a position." 

Most notably, a regional plan update that was supposed to come out by 2007 remains unfinished. Without that update, uncertainty—and therefore stasis—has come to dominate land use in the basin, thus leading to SB 271. In addition, the California side of the basin must now mesh the regional plan with a sustainable communities strategy as required under SB 375.

"We haven't had [an update] for quite a while. They're just amending the current on piecemeal, project-by-project," said Nichols. 

Authorized by a unanimous board vote in January, TRPA staff have finally embarked on a new planning process for the regional plan update. Staff hopes to circulate a draft EIR by the end of 2011 with a possible vote in 2012. What, exactly, the Nevada delegation might demand of a new regional plan update remains undefined—but not without attracting speculation. 

Though TRPA regulations cap development in the Tahoe Basin in the broad sense, Nichols said that plenty of developers and existing landowners would like to create new developments and expand existing ones, especially in casino-rich South Lake Tahoe. Opponents of SB 271 have pointed to projects such as the Boulder Bay hotel expansion in Crystal Bay, Nev., as examples of things to come under SB 271. They say that, by quadrupling its current size, the project violates the Bi-State Compact; it was approved by TRPA in April. 

"It's obvious that this is being promoted by Nevada gaming interests on the Nevada side of Lake Tahoe," said Nichols. "They don't want to be constrained by thresholds all that pesky stuff that the compact has them do. "Although they would say that they have to comply with all the existing environmental restrains, even if they separate, I think they will change those thresholds."

SB 271 comes about now in part because Nevada's economy has suffered during the current recession and landowners see TRPA's regulatory structure as an impediment to efficient development. In particular, TRPA has been blamed even for holding up projects that were intended to reduce pollution and runoff into the lake. 

Billy Vassiliadis, CEO of R&R Partners and creator of the famed "What happens in Vegas" marketing campaign, was one of the lead lobbyists in favor of SB 271. His clients included a collection of landowners around the lake, including prominent casino interests. Likewise, the Nevada Resort Association supported SB 271. 

"The Nevada Resort Association supported the position of one of its largest members, Caesars, in seeking assurances regarding Lake Tahoe's future during one of the most challenging times that tourism market has ever experienced," said association President Virginia Valentine in a prepared statement.

That argument draws little sympathy from Nichols. "We can't change the compact every time there's a recession," she said. 

Environmentalists fear that a Caesars Palace, or even a poorly designed mountain chalet, could wreak havoc with the lake's fragile ecosystem, which of course does not heed the state border that runs through it. Regan said that urban runoff is one of the biggest threats to the lake's clarity. The lake is currently clear to 67 feet, whereas the goal of TRPA is 100 feet. 

Vassiliadis insisted that Nevada maintains a paramount interest in supporting the health of the lake. He noted that SB 271 adopts the environmental language of the Tahoe Compact and thus obligates the state to uphold its goals. 

"The impact is not to reduce or to lower any environmental standards, as has been alleged," said Vassiliadis.   

But Nevada's definition of "obligation" may hew more towards voluntary compliance and away from regulations that some say are crucial to preventing the further muddying of the lake's waters. 

"It's not that Nevadans don't love Lake Tahoe; it's that they think it can be saved through purely voluntary approaches," said Nason. "The League to Save Lake Tahoe and the rest of Tahoe's conservation community believes that strong regulation of matters like land coverage and traffic impacts needs to continue."  

"Oftentimes Nevada has more of an independent streak, perhaps more of an interest in protecting private property rights," said Regan.

Moreover, if Nevada is not constrained by California's interests, then its Legislature can amend SB 271 at will, thus obviating the protections that the current version contains. 

Conversely, despite the stigma that accompanies the notion of development in such a sensitive area, some suggest that more development could actually help the lake. In particular, if an updated regional plan could promote the replacement of aging, substandard buildings with new, environmentally sensitive construction. 

"We have marvelous new technology to conserve and be green," said Vassiliadis.  "So it's more of a matter of not allowing a group to just say no to any permits or any process."

Geoffrey Schladow, director of the Tahoe Environmental Research Center at UC-Davis, said that advances in understanding the threats to the lake and in mitigation techniques may warrant new construction, some of which might have to be executed by the sort of deep-pocketed developers that concern environmentalists. 

"If we want these developed areas to be re-engineered then some degree of redevelopment may be inevitable," said Schladow. "It's hard to believe that the existing small-scale mom and pop stores or motels would have the capital to do what's needed."

Contacts

Rochelle Nason, Executive Director, League to Save Lake Tahoe, 530.541.5388

Ann Nichols, President, North Tahoe Preservation Alliance, 775.831.0626

Julie Regan, External Affairs Director, Tahoe Regional Planning Agency, 775.589.5237

Geoffrey Schladow, Director, UC-Davis Tahoe Environmental Research Center, 530.754.8372

Billy Vassiliadis, CEO and Principal, R&R Partners, 702.228.0222

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