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Item 34 Staff Report Consideration of a Modification to Town Policy Permitting the Sale of Beer and Wine with Meals in the C-2 Zone (Continued from November 20, 1989)Council Agenda Date: 2/20/90 Item: 3, j TOWN OF LOS GATOS Council Agenda Report DATE: February 15, 1990 TO: MAYOR AND TOWN COUNCIL FROM: DEBORAH A. ACOSTA, TOWN MANAGER SUBJECT: CONSIDERATION OF A MODIFICATION TO TOWN POLICY PERMITTING THE SALE OF BEER AND WINE WITH MEALS IN THE C-2 ZONE. (CONTINUED FROM NOVEMBER 20, 1989). RECOMMENDATION: 1. It is recommended that the Town Council: a. Modify the Town's policy for restaurants in the C-2 zone to allow the sale of beer and wine with meals subject to all conditions of the use permit on a case -by -case basis. b. Direct the Planning Commission to consider an amendment to the Zoning Ordinance to regulate establishments with entertainment. TOWN COUNCIL ACTION: On August 21, 1989, the Town Council considered an appeal of the Planning Commission's decision in denying a request to serve beer and wine as part of an existing restaurant operation at 27 E. Main Street. The matter was continued to November 20, 1989, to allow staff time to review the Town's policy of not allowing more liquor licenses downtown and to address concerns raised by the Council (i.e., public safety, sufficient police staff, parking), including reports from the Police Chief and the number of licenses which have been issued outside the central business district since this policy has been in effect. Due to the earthquake, the matter was continued to the meeting of February 20, 1990. (Continued on Page 2) PREPARED BY: LEE E. BOWMAN e_ Planning Director LEB:SLB:cher PL06\CNCLRPTS\2-20#2B Reviewed by: Attorney TOWN COUNCIL ACTION DIRECTED TO: ACTION OF COUNCIL: PAGE 2 MAYOR AND TOWN COUNCIL SUBJECT: HEARING TO CONSIDER THE APPEAL OF 27 E. MAIN STREET DATE: FEBRUARY 20, 1990 PLANNING DEPARTMENT REVIEW: There are currently 88 restaurants in the Town of Los Gatos (including donut shops, ice cream parlors and restaurants temporarily out of business due to the earthquake). Of the 88 restaurants, 41 are located in the C-2 zone (Central Downtown Business District). Of these 41 restaurants, 10 have a license to serve beer and wine and 5 have a separate bar. There are 8 bar establishments in Los Gatos, 4 of which are located in the C-2 zone. Since 1978, the Town has approved six Conditional Use Permits for a restaurant to serve alcoholic beverages with meals outside of the C-2 zone. Since 1978, the Town has approved two Conditional Use Permits for a restaurant to serve alcoholic beverages within the C-2 zone. The first approved was for the Mandarin Delight restaurant, which took over a portion of the Noodle Palace. The justification for this approval was that the Noodle Palace Restaurant had a separate bar, and the bar's service area would be cut in half by the addition of Mandarin Delight. The other approval was for the Main Course (currently "And Chili's"). This approval was justified since the Main Course took over a liquor store, and therefore, the liquor license for off -site consumption would be modified to on -site consumption. As for the Town Council' s concern regarding changing the Town policy, the request for a restaurant to serve alcoholic beverages requires a Conditional Use Permit, therefore, any concerns the Town has regarding, the use can be conditional, (i.e. hours of operation, type of beverages, use, etc.). One of the conditions the Town has been applying to these types of permits since 1986 is that the permits are subject to annual reviews by the Police Department. If it is determined that the sale of alcohol is a nuisance, the permit shall be subject to reevaluation by the Planning Commission. As of this date, there have not been any problems that the Commission has had to address. In addition, when reviewing new applications for a bar and/or restaurant, a policy of the Land Use Element of the Downtown Specific Plan requires that no new bars and/or restaurants be approved unless it can be demonstrated that they will not cause traffic or public safety problems. The parking requirement will not change for a restaurant if it serves alcohol with meals. However, if a separate bar is proposed in the downtown area, the parking requirement will increase from one parking space for every four seats to one space for every three seats. Since most uses in the downtown do not have excess parking, requests for a separate bar would be almost impossible to obtain unless additional parking can be provided on -site. POLICE DEPARTMENT REVIEW: The Chief of Police has stated that their department does not object to the sale of any type of alcoholic beverages in conjunction with a legitimate restaurant business. According to the Department, this type of business actually reduces public safety problems as opposed to a business that serves only alcohol and/or provides entertainment. In reviewing Police Department records for 1989, the Los Gatos Police Department made a total of 598 drunk/drunk driving arrests. Of these arrests, only three were known to have become intoxicated at a restaurant which served alcohol with meals. Eighty-seven arrests are known to be related to bar establishments and 54 are related to restaurants which had a separate bar. From this analysis, it PAGE 3 MAYOR AND TOWN COUNCIL SUBJECT: HEARING TO CONSIDER THE APPEAL OF 27 E. MAIN STREET DATE: FEBRUARY 20, 1990 appears that a large number of police problems associated with alcohol are from businesses which are a bar establishment or have a separate bar. RECOMMENDATION: From the above analysis, the Planning and Police Departments agree that the serving of beer and wine with meals is not anticipated to result in additional police problems. Therefore, it is recommended that the Town Council modify the Town's policy for restaurants in the C-2 zone to allow the sale of beer and wine with meals. However, due to the problems associated with bars, it is recommended that requests for a separate bar in conjunction with a restaurant still be dis- couraged. Another issue the Council may want to consider in the future is the regulation of entertainment establishments. The Zoning Ordinance does not specifically address inside entertainment establishments and as indicated by the Police Department, a major source of police problems are from entertainment establishments which serve alcohol with or without meals. FISCAL IMPACT: Possible increase in tax revenues. EXHIBITS: New Submittal: 1. Town Council minutes of August 21, 1989. DISTRIBUTION: Ilham & Mina Arif, 27 E. Main Street, Los Gatos, CA 95032 Cal -Irish, 39 E. Main Street, Los Gatos, CA 95032 Chamber of Commerce Los Gatos Downtown Association TOWN OF LOS GATOS CALIFORNIA TOWN COUNCIL/PARKING AUTHORITY AGENDA AUGUST 21, 1989 MINUTES ✓MAIN STREET E. 27/HIGH-THAI/OW: CAL-IRISH/APP: ARIF/HEARING Mayor Benjamin stated that this was the time and place duly noted for public hearing to consider the appeal of the Planning Commission's denial of request to serve beer and wine as part of an existing restaurant operation in the C-2-LHP zone, U-83-28A. Property: 27 E. Main Street. Owner: Cal -Irish. Applicant: Ilham and Mina Arif. The following people from the audience addressed the issue: Ilham Arif, 27 E. Main St., the owner of the restaurant, spoke of the need for his business to serve beer or wine with the meals. The following people expressed great satisfaction with the restaurant and would like the facility to also serve beer and wine with the meals: Larry Miller, 18608 Favor Ridge, Los Gatos. David Barton, 14842 Nelson Way, San Jose. Ranston Long, 15973 Shannon Road, Los Gatos. Joe Tabor, 110 Oak Rim Court #26, Los Gatos. Bob Welsh, 14850 Oka Road #12, Los Gatos. Susan Barton, 14842 Nelson Way, San Jose. Bruce Jenkie, 54 Cleland Ave., Los Gatos. Phil Schatz, 135 Riviera, Los Gatos. Bruce Eisenhardt, 310 Almendra, Los Gatos. Dorothy Miller, 18608 Favor Ridge Road, Los Gatos. Marie Connors, 365 Los Gatos Blvd., (And Chili's), business owner. No one else from the audience wished to speak to this issue. Mr. Ferrito stated the following relating to this issue: that he was a strong proponent of the limited availability of liquor licenses issued in Town; he did not feel that this stand was due to religious or moral reasons on his part or the Council's, mentioning that he personally serves alcoholic beverages in his home to guests; he does not feel that this policy protects restaurants with poor service and food; the real issue is that a liquor license runs with the land and there is no reason to open up the availability of these licenses when Council has no way of removing them after their issuance; and the policy of not allowing more liquor licences in downtown is based upon the expectation of attrition of these liquor establishments. Mayor Benjamin would like to look at this policy for the following reasons: there was a previous problem ten to fifteen years ago with the bars downtown and their clientele; would like to make a policy that delineates the criteria for a restaurant before a permit is allowed; would like staff to look at this issue and bring back a report for Council. Mr. Hamilton is in favor of a study regarding this policy and in favor of any of the restaurants already in existence who would wish a license to be able to receive one. Mr. Ilham Arif agreed to a continuance of his appeal during which time the Council will review the Town's liquor license policy. EXIST r 1 Mr. Ventura has been a long time advocate of the prohibition of new alcohol permits in the downtown for the following reasons: public safety was at risk due to the large numbers of people downtown under the influence of alcohol roaming the streets; the problem had been so severe that there was not TOWN OF LOS GATOS CALIFORNIA TOWN COUNCIL/PARKING AUTHORITY AGENDA AUGUST 21, 1989 MINUTES MAIN STREET/HIGH-THAI CONTINUED/HEARING sufficient police staff to cover the need; he questioned the possibilities of expanding the size of a restaurant after the beer and wine permit was issued; and would not approve the addition of any sitting bar within the facility; how can the rules and regulations imposed locally be imposed on a State regulated beer and wine license; what does the addition of beer and wine licenses to the downtown community do to the parking districts. Motion by Mr. Carlson, seconded by Mr. Hamilton, that Council continue this issue for three months until November 20, 1989, at which time staff will bring back a study and recommendation taking into account the testimony received tonight and at other times Council was asked to review this policy, and to address the concerns of Mr. Ferrito including reports from the police chief and the number of licenses which have been issued out side the central business district since this policy has been in effect. Carried by a vote of 4 ayes. Mr. Ferrito voted no. February 20, 1990 Los Gatos, California MINUTES OF FEBRUARY 20, 1990 Continued to March 5, 1990 MINUTES OF FEBRUARY 12, 1990 Motion by Mr. Ventura, seconded by Mrs. Benjamin, to approve the minutes of February 12, 1990 as submitted. Carried unanimously. CODE ENFORCEMENT/REFERRALS TO TOWN ATTORNEY Informational item received and filed. PLAZA LA POSADA 241/UNDERGROUND NONLIVING SPACE/RESOLUTION 1990-4 Motion by Mr. Ventura, seconded by Mrs. Benjamin, that Council adopt Resolution )90-44 entitled, RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF LOS GATOS GRANTING THE APPEAL OF A DECISION OF THE PLANNING COMMISSION IN GRANTING APPROVAL OF PLANS FOR THE CONSTRUCTION OF A NEW SINGLE- FAMILY RESIDENCE IN THE R-1:10.000 ZONE AND MODIFYING SAID APPROVAL (241 PLAZA LA POSADA -RONALD J. HAAS), incorporating the findings and decision of the Town Council at its meeting of February 5, 1990. Carried by a vote of 4 ayes. Mr. Carlson voted no asking that record show that it is not fair to limit the living space to 2,472 sq. feet. Motion by Mrs. Benjamin, seconded by Mr. Hamilton, that the swimming pool is not required to be filled in before construction of the home. Carried by a vote of 4 ayes. Mr. Ventura voted no. INFORMATION SYSTEMS/PEAT MARWICK/CONTRACT/CONSULTING SERVICE Motion by Mr. Carlson, seconded by Mr. Ventura, that Council adopt Resolution 1990-45 entitled, RESOLUTION OF THE TOWN OF LOS GATOS AUTHORIZING THE TOWN MANAGER TO EXECUTE A CONTRACT WITH PEAT MARWICK MAIN AND COMPANY FOR A PARTIAL PHASE I OF INFORMATION SYSTEMS CONSULTING SERVICES, which includes needs analysis through recommendations but does not include preparation of RFPs or contract negotiations with vendors. Carried unanimously. BUDGET REPORT/SECOND QUARTER Recommendation to continue this item to March 5, 1990. BEER AND WINE WITH MEALS/C-2 ZONE/MODIFICATION OF TOWN POLICY Motion by Mr. Ventura, seconded by Mr. Carlson, to reagendize this item and schedule it for a Public Hearing. Carried unanimously. TC:DI:MM022090 10