Planning Commission recommends changes to alcohol ordinance

Work continues on an outdoor seating area at the new Fruition Brewing in the East Lake Village Shopping Center in Watsonville. — Tarmo Hannula/Register-Pajaronian

Modifications would rework downtown, shopping centers 

WATSONVILLE — The Watsonville Planning Commission on Tuesday took the first steps in walking back the city’s strict alcohol ordinance put in place 17 years ago. 

By a 4-2 vote following a nearly four-hour meeting, the commission — with Vice-Chair Matthew H. Jones absent — recommended the City Council make drastic changes to the city’s current laws around alcohol-related businesses. Chief among those changes: creating an overlay district in downtown that stretches from 2nd Street to 5th Street which would allow up to 15 percent of all businesses in the area to be alcohol-related, defined by the city as any business that sells alcohol.

The recommendation would also allow up to 30 percent of all businesses at shopping centers throughout the city to be alcohol related.

In their original proposed modifications to the city’s municipal code, city staff recommended a 10 percent cap in the new downtown district and a 20 percent limit in shopping centers. But Chair Jenni Veitch-Olson’s amendment to increase the percentages passed with commissioners Jenny T. Sarmiento and Anna Kammer voting no.

The commission also unanimously amended the city’s proposal by pushing the hours of last call on Fridays and Saturdays to 11 p.m. instead of the proposed 10:30 p.m.

The City Council is expected to mull over the recommendation in a meeting sometime next month.

The current alcohol ordinance was put in place in 2002 to combat the city’s longstanding issues with alcohol-related businesses, primarily in the lower downtown area. It put stringent restrictions on the proximity of one alcohol-related business to another as well as parks, schools and churches.

The ordinance helped crack down on problem businesses, but it also limited development throughout the city, according to Community Development Director Suzi Merriam.

“For 17 years, that worked pretty well,” Merriam said. “However, there have been things that we’ve noticed in the last few years that needed changing.”

So city officials over the last year met with members of the community to draft a new comprehensive modification to the ordinance that would allow the city to rebuild its struggling downtown around alcohol-related business.

The proposal, which was modeled after the Cannabis Ordinance the city approved in 2016, includes a more in-depth application process, additional training for business owners, a new annual $400 alcohol license fee and a streamlined procedure for city staff to modify or revoke permits for problem operators.

The application process would allow city staff to score a proposed business on a broad list of qualities, including its location, business plan, neighborhood compatibility plan, safety and security plan, community benefits, labor and employment and local enterprise/qualifications of participants.

Only high-scoring businesses would be approved, Merriam said.

“I think staff taking the time to work with the business through this process and really get to know them is going to be a benefit for both the business owner as well as city staff, because its a much more collaborative process than we currently have,” Merriam said. “It also sets clear expectations on both sides.” 

The proposal would also establish a “Central Commercial Core Area” in downtown that would open up new opportunities for alcohol-related businesses to move in and revitalize the area. The city, Merriam said, would like to follow the lead of neighboring cities and restructure its downtown around experience-based businesses like brewpubs, wine tasting rooms and farm-to-table restaurants.

“These are some of the flexible spaces we want to have in downtown Watsonville and throughout the city,” said Merriam, as photos of Santa Cruz’s Abbott Square and San Jose’s San Pedro Square Market illuminated the council chambers. “These are business types or ideas that weren’t around or even a figment of our imagination back in 2002 when we were working on the ordinance. This is kind of the vision of where we want to go.”

The modifications to the ordinance were lauded by both developers and community prevention partners, though the former firmly pushed back on the initial proposal’s percentage caps, saying they halted future business growth.

Chris Codiga, who with his brother Clark manages the East Lake Village Shopping Center under the Oaktree Property Company, called the cap “arbitrary” and said his property would be out of compliance with the 20-percent cap by the end of the year with Fruition Brewing and Staff of Life moving in — they would have 26 percent of their businesses be alcohol related. 

“Eventually, maybe East Lake has seven or eight restaurants and we can’t accommodate them in the city because of the ordinance,” Codiga said. “There’s no growth accounted for in the ordinance…The economy is not static and we don’t know what the future holds.”

Commissioner Kammer, however, was concerned about bumping the percentage cap for all shopping centers across the city, saying that not all are the same as the burgeoning East Lake Shopping Center.

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