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City Council Approves Zoning Changes to Expedite Business Recovery Citywide

May 12, 2020

City Council Approves Zoning Changes to Expedite Business Recovery Citywide

SANTA MONICA, Calif. -- Tonight, the Santa Monica City Council approved two Interim Zoning Ordinances to make it easier for new and existing businesses to open and reopen as part of the City’s recovery from the impacts of the novel coronavirus (COVID-19). The temporary changes to the zoning ordinance will reduce regulatory barriers to provide immediate relief and clearly defined rules for primarily small, local businesses as they make plans to re-open when it’s safe to do so.  

“We’re creating opportunities and eliminating barriers for existing and new businesses alike, while retaining the thoughtful process that protects our community values,” said Mayor Kevin McKeown.  “The coronavirus shutdown gave us the impetus to streamline traditional rules, accelerate recovery, and look to a bright future.” 

Prior to the closure, staff was working on minor amendments intended to provide some regulatory flexibility for Third Street Promenade businesses as part of the “Promenade 3.0” project. Since then, staff identified additional issues that new small businesses often confront when choosing to open in Santa Monica, including land use regulations, alcohol service requirements, and parking and commercial loading standards. 

The changes affect existing businesses in the Third Street Promenade area and the major commercial districts in the city. The Third Street Promenade changes support the goals of creating a more interesting experience through more opportunities for nightlife, entertainment, and flexibility to experiment with different uses. Here are the changes broken out by location: 

Eliminate 1-year Rule for Abandonment of Legal Non-Conforming Use for Retail and Restaurant Uses 

Previously, when a tenant space sat vacant for more than one year, the use was considered abandoned, and a new application would be required for the proposed use thereafter, even for the same use. Due to the scale of the economic impacts associated with COVID-19, it may take some time for businesses to have the resources to start (or re-start) within the one year time frame. To reduce this burden on businesses impacted by COVID-19, the following was adopted: 

Citywide and Third Street Promenade Changes 

  • Removed the one-year time limit for when a legal, non-conforming use is considered to have been abandoned for restaurants and retail. 

Requirements to Provide Additional Parking and New Loading Spaces 

A change of use often triggered additional parking and loading space requirements for an existing tenant space.  These regulations limited where certain businesses could operate, requiring them to provide additional parking or loading spaces where no space exists. A modest increase in the parking allowance for change of use and re-tooling parking calculations for changes of use is intended to remove parking as a potential barrier in establishing a new business. In order to supportthe re-occupation of vacant spaces, encourage outdoor dining particularly as social distancing requirements are expected to continue, and encourage more flexibility in change of use, the proposed amendments were adopted: 

Citywide Changes 

  • Increase the change of use parking relief from 3 to 10 spaces.  
  • Exclude all outdoor dining areas from parking calculations. 
  • Base the parking calculation only on public dining areas. 
  • Redefine “Physical Training” to remove the cap on the number of students in each studio or gym class. This lowers the parking requirement for gyms to match that of other commercial uses.  
  • Require a Parking and Loading Operations Plan in lieu of an on-site loading space where a change of use of up to 5,000 square feet is proposed. 

Third Street Promenade Changes 

  • Require a Parking and Loading Operations Plan in lieu of an on-site loading space. 

Reduce Restrictions on Restaurant Size  

New and expanding restaurants are regulated by their size, both square footage and number of seats, and also by their location. Certain commercial zoning districts required a discretionary permit for restaurants above 2,500 sf, which posed a barrier to both new restaurants opening into large tenant spaces and existing restaurants that may be considering expansion into vacant adjacent tenant spaces. The adopted interim zoning ordinance proposed the following changes to reduce the burden that restaurant operators face when opening in Santa Monica: 

Citywide Changes 

  • Restaurants up to 5,000 sf are permitted by-right. 
  • Remove the cap on the number of restaurants per block on Main Street.  
  • Add multi-tenant Food Halls as conditionally permitted uses. 

 Third Street Promenade Changes 

  • Remove restriction on converting eating and drinking establishments to another use on the ground floor. 
  • Add multi-tenant Food Halls and Light Industry as permitted uses.  

Relaxed Alcohol Service Regulations 

The modified Alcohol Exemption conditions and processes aim to alleviate the need for a Conditional Use Permit when a restaurant proposes to serve alcohol concurrent with its primary food service. The previous conditions of approval proved to be burdensome for restaurant operators and when all 26 conditions were not met, required a time consuming and costly public hearing in front of the Planning Commission. The new conditions seek to provide more flexibility in operations for restaurants (not bars, nightclubs or lounges) citywide, while allowing more flexibility for operations in the Third Street Promenade area. 

Citywide Changes 

  • Expanded alcohol service hours from 8 AM to 12 AM, seven days a week. 
  • Eliminate the cap on alcohol sales of 35% of gross revenue. 
  • Continue to allow for delivery and take-out of alcohol if the operator holds a valid ABC license. 
  • Eliminate the opportunity to appeal AE determinations of over 50 seats.  

Third Street Promenade Changes 

  • Allow any alcohol service establishment through an administrative process 
  • Expanded alcohol service hours from 8 AM to 2 AM, seven days a week, with food service being available until at least 10 PM.  
  • Eliminate the cap on alcohol sales of 35% of gross revenue. 
  • Allow for off-sales of alcohol if the operator holds a valid ABC license. 
  • Remove restrictions on television screens and video or other amusement games. 
  • Allow for entertainment. 
  • Eliminate the opportunity to appeal AE determinations. 

This work along with other forthcoming procedural changes are components of Santa Monica’s focus on economic recovery. Recovery efforts include greater staff approval authority for simple design review applications, an overhaul of the Minor Outdoor Dining process and guidelines, and the streamlining of the processes to open a business in Santa Monica, and complete commercial tenant improvements.  

“We are laser focused on economic recovery for all in our community. Every Council meeting will include at least one agenda item that protects vulnerable residents or supports our struggling local business community,” said Interim City Manager Lane Dilg. “These zoning changes expedite work that was already underway to ensure that restaurants and other local businesses can thrive in Santa Monica. We encourage Santa Monicans to continue to enjoy our local restaurants and to support your favorite local bookstores, toy shops, sporting goods stores, and clothing shops as they begin to reopen now and in the weeks to come.” 

The work towards economic recovery is spearheaded by the City’s Economic Recovery Task Force, comprised of a team of City staff across relevant departments. This City team is dedicated to collecting, vetting, and advancing the best ideas in all five identified focus areas: 

  • Business Reopening & Retention 
  • Business Permitting 
  • Community Economic Development 
  • Communications and Marketing 
  • Federal, State, and County Resources 

 The team is designed to take quick, decisive action to move key items forward in partnership with subject matter experts and the community. 

Recommendations from the City staff Task Force will be built upon the ideas, analysis, as well as expertise of business, and resident partners. Many action items will require a public process and Council approval. There will be several opportunities for resident and community involvement, including town hall sessions and other virtual meetings to generate and vet ideas, along with community surveys and interactive tools on a forthcoming Economic Recovery website. Register for SaMoNews, the City’s email newsletter at santamonica.gov/newsletter to get involved and receive regular updates on all of the Santa Monica’s economic recovery efforts. 

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