Business & Real Estate

Drought alters the face of Tahoe tourism

Ski lift chairs sit idle at shuttered Soda Springs on Wednesday amid drought conditions that have forced several Tahoe ski resorts to close early due to lack of snow. As a result, ski resorts, hotel owners and others are scrambling to find new ways to attract tourists to the lake.
Ski lift chairs sit idle at shuttered Soda Springs on Wednesday amid drought conditions that have forced several Tahoe ski resorts to close early due to lack of snow. As a result, ski resorts, hotel owners and others are scrambling to find new ways to attract tourists to the lake.

Drought is reshaping Lake Tahoe and its all-important tourism industry.

Seven ski resorts have shut down early for the season because of a shortage of snow. The latest is Sugar Bowl Resort, which will turn off its chairlifts at the close of business Sunday.

The long-term impact goes deeper. As California’s drought stretches into its fourth year, ski resorts, hotel owners and others are scrambling to find new ways to get tourists to the lake. They’re relying less on snow and putting greater emphasis on entertainment, fine dining and other forms of recreation. With climatologists predicting long-term declines in snowfall throughout the Sierra Nevada, some resorts are building zip lines, mountain bike trails and even wedding venues, all in hopes of broadening their customer base.

“Resorts have been looking at their business models and seeing we have to be in the mountain recreation business, not the winter business,” said Bob Roberts, head of the California Ski Industry Association.

Tahoe isn’t giving up on traditional winter activities. Squaw Valley Resort, for instance, has spent tens of millions of dollars upgrading its facilities in the past few years, including a $5 million investment in additional snow-making equipment.

Nonetheless, the tourist attractions are conjuring up different ways to lure visitors. It’s telling that Squaw Valley is hosting its first-ever bluegrass and craft-beer festival this weekend, just a few weeks after it canceled a World Cup skiing and snowboarding tournament because of the poor conditions.

“People can come up to the mountain and have a very eventful time without ever clipping into skis or putting on a snowboard,” said Squaw spokeswoman Melissa Matheney.

Squaw has been able to stay open, but the list of resorts that closed early includes some of the most venerable names in Tahoe skiing: Sugar Bowl, Homewood Mountain, Sierra-at-Tahoe.

The closures are particularly painful for two reasons: One, the season had gotten off to a good start, thanks to two strong storms in December. Two, the Tahoe tourism industry was just beginning to climb out of a long period of hibernation prompted by the recession and fierce competition from California Indian casinos. Developers have been pouring millions into ski resorts, hotels and other amenities in hopes of weaning Tahoe from its historic dependence on gambling and turning the lake into an international destination and not just a day trip from Sacramento.

“There’s a lot of positive momentum in the marketplace, but this bizarre (weather) cycle we are experiencing ... has interrupted some very positive and long-awaited momentum,” said Lew Feldman, a Tahoe lawyer who represents developers in the region.

The cycle might not be so bizarre. The snowpack has been below average for each of the last four years. Both January and March have been the driest in California history; last week, snowpack in the Central Sierra measured at 13 percent of average.

And climate experts say tourists shouldn’t count on robust, reliable snowfall in the coming years.

Mike Anderson, state climatologist at the California Department of Water Resources, said warmer temperatures mean a greater percentage of Sierra precipitation will fall as rain instead of snow. So even when the drought ends, snow will account for a smaller share of the precipitation than before.

The trend has been ongoing since 1980 and isn’t going away.

“We definitely have an expectation for warmer temperatures,” Anderson said. “So years like this winter will definitely become more the norm instead of being the outlier.”

‘Still a magnificent place’

Feldman and others said they believe Tahoe can withstand whatever the climate can dish out. Rather than pull back, developers are moving forward with ambitious plans for luxury lodging and other amenities, many oriented toward warmer weather.

On the west shore, Homewood plans to break ground next year on a $400 million redevelopment that includes a hotel, ice rink and condo units. On the south shore, the owners of Edgewood Tahoe golf course have been rearranging the course to make room for a $100 million luxury lodge expected to open in 2017. The infamous “hole in the ground” in South Lake Tahoe, a spot reserved for a convention center that lay dormant for years, has begun sprouting restaurants and shops.

“I see projects moving forward, ideas moving forward,” said Carl Ribaudo of SMG Consulting, a tourism consultancy in South Lake Tahoe. “At the end of the day, Lake Tahoe is still a magnificent place to see ... and that goes beyond skiing and snowboarding.”

One of the biggest new developments is the Hard Rock Hotel & Casino in Stateline, Nev., which replaced the old Horizon resort at a cost of $60 million. The reopened hotel has gotten off to a strong start since its late January debut, selling out on weekends with an emphasis on live music and “high-energy fun,” said Brooke Fiumara, vice president of marketing at the Hard Rock’s management company, Warner Hospitality.

“If there’s no snowfall, we’ll still have things for you to do,” she said.

Good thing. Shortly after the hotel opened, the snow largely stopped falling, and what had been a promising ski season began to dry up. Tourism officials said bookings at many hotels started tailing off in February.

Those who are visiting this winter are showing signs of adapting to the changes. Shaun Walker of Discovery Bay, in Contra Costa County, brought his family to Tahoe for a vacation last week. Walker, his wife and two young children normally buy season passes at Squaw Valley. This year, they didn’t. Instead, they spent a good deal of their vacation hiking around the north shore and enjoying the sights. And they scheduled one day of snowboarding at Boreal Mountain Resort, where the north-facing mountain and snowmaking gave the runs decent coverage.

“We’ve had season passes for the last 20 years, and this year was the first year we didn’t buy them because of the drought,” said Walker, 32. “And I’m glad we didn’t. We just opted not to ski and not waste the money.

“I feel bad for the ski resorts,” he added. “I’m sure they’re taking a hit.”

The problem isn’t limited to Tahoe. Nearly two dozen ski resorts around the West have closed prematurely this year, including 13 throughout California.

Some of the resorts that have suffered the worst of the drought are trying to build a summer business. Sierra-at-Tahoe, which shut down for the season last weekend, will start hosting weddings this summer. Royal Gorge, a cross-country ski venue that operated intermittently this year before closing three weeks ago, plans to upgrade its mountain bike trails.

Of course, summer has always been a significant part of the Tahoe scene. Of the 1.1 million hotel-room stays recorded at the south shore last year, about 47 percent took place between May and September. Those figures don’t include overnight visitors who stayed in campgrounds.

“Thank God we are not completely snow-dependent,” Feldman said.

Tubing and trampolines

As Tahoe adjusts to climate change, Congress has helped. A 4-year-old federal law gives ski resorts on national forests greater leeway to develop summer recreation offerings.

Among the most aggressive has been Heavenly. The south shore resort now offers something called “summer tubing,” which lets guests ride snow tubes on a 500-foot path coated with artificial turf. Last year, it opened rope courses and zip lines. It’s in the final stages of getting approval from the Tahoe Regional Planning Agency to build a mountain bike park, additional zip lines and a kind of mountain roller coaster.

“We are definitely expanding more to the non-ski guests,” said Heavenly spokeswoman Liesl Kenney. Heavenly’s owner, Colorado-based Vail Resorts Management Co., is spending $25 million on summer recreation infrastructure at its various resorts.

A similar transformation took place at Boreal Mountain Resort three years ago, when it opened a 33,000-square-foot indoor recreation facility called Woodward Tahoe. Among the offerings: a concrete skateboard park, trampolines and digital-media lab. Boreal also now hosts outdoor summer camps for BMX biking and other activities.

Spokeswoman Tess Hobbs said the goal has been to make Boreal more of a year-round operation, and it’s working. “We just saw a really great opening here in Tahoe,” she said. “It’s just a really great combination.”

Other venues are gearing up for summer, too. Hard Rock, for instance, plans to open a 7,500-seat outdoor amphitheater for concerts this summer.

But songfests and skateboard parks are of little consolation for those who come to Tahoe for the snow. Mike and Julie Burke of Auburn, who were skiing at Sugar Bowl on Wednesday, lamented that they’ve gotten in only 15 days of skiing this year at Tahoe. Five years ago, they counted 41 days on the slopes.

“It’s time for the weather to switch up,” Julie Burke said. “If not, we’ll probably be looking at relocating.”

Sarah Grimaldi is another person who worries about the long-term forecast. A Tahoe resident who works at Squaw Creek, she said the resort’s conference business has held up well this year. But as she spent Wednesday afternoon relaxing on a sun-splashed beach on Donner Lake, flanked by mountains without a speck of snow, she fretted about the future of the ski business.

“We’ve lived here 15 years, and this is the least snow I’ve ever seen,” Grimaldi said as her 2-year-old daughter, Kara Blue, played in the sand. “I hope it’s not the new normal. That would be really sad. If it continues to be like this, it would be crushing to the local economy, and just the local fun.”

Some experts say four years of drought could do lasting damage to the Tahoe tourism market. That’s particularly true for the estimated 40 percent who visit from farther away than Northern California and usually book their trips well in advance.

“As one year (of drought) turns into another, and into another, it becomes alarming,” said Ralf Garrison of The Advisory Group, a Denver tourism consultancy that specializes in mountain resorts. “We begin to wonder how loyal they’ll be, and for how long.”

In the ski industry, however, the heat hasn’t melted all the optimism. Many resort operators said they believe decent snowfall will return to Tahoe next year, and they think customers will respond.

“Most of our skiers are dedicated enough,” Sugar Bowl spokesman John Monson said. “We’re certainly hoping it’s the season that pulls out of the drought. It’s been a very tough go.”

Closed West Coast ski resorts

Call The Bee’s Dale Kasler, (916) 321-1066. Follow him on Twitter @dakasler.

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