But it also Put Certain Limits on Hotel and Pawn Shop Operations
The city council continues to adjust its policies in an attempt to stimulate downtown business activity.
On Tuesday evening, the council voted to codify some temporary measures it had previously approved, while also adding to them. The previous city council, in October of 2023, passed language to allow certain rooftop commercial uses on parking structures, increased flexibility for restaurants providing entertainment, and streamlined review of alcohol permits in the downtown area.
Last November, the previous council went further to simplify the review process for new businesses, eliminating Conditional Use Permit (CUP) and Minor Use Permit requirements. It also further streamlined alcohol permitting requirements for some commercial uses.
In March of this year, the current council adopted amendments to allow more flexibility with digital signage for properties facing the Third Street Promenade. In July, the Planning Commission adopted amendments – previously passed as interim zoning regulations – that extended opportunities for alcohol exemption permits, increased operational flexibility for restaurants with entertainment, and removed a prohibition against some fast-food restaurants with storefronts along the Third Street Promenade.
While the current interim zoning ordinance lasts until 2028, the move to fully codify measures on Tuesday was in part to provide greater certainty to the business community and potential tenants that the city is committed to strengthening new and existing businesses for the long term.
Specifically, the council was asked by staff to:
- Allow for additional alcohol exemptions in a greater share of what’s known as the Bayside Conservation district. An additional block was added to include properties along Ocean Avenue between Wilshire Boulevard and Colorado Avenue.
- Remove some operational restrictions for restaurants with “ancillary entertainment” before a Conditional Use Permit is required. Previously, there were limits on dancing, the number of mounted televisions, and pub crawls. This also expanded permission for these activities to Ocean Avenue between Wilshire and Colorado.
- Eliminate the prohibition on certain fast-food restaurants on the Third Street Promenade. The city will now allow a full range of restaurants, including limited-service and take-out chains.
- Allow Pawn Shops back into the downtown district.
Jonah Breslau, a representative of United HERE Local 11, the union representing hotel workers, expressed concern that eliminating CUPs would allow new hotels to open without labor protections. Councilmember Natalya Zernitskaya asked staff to clarify this provision as it relates to the prospect of a new hotel.
City staff explained that the provision to eliminate CUPs was to give the city more discretion to allow for businesses that didn’t normally conform to downtown land use classifications. They pointed to operations like the virtual reality gaming site and mini golf course.
Mayor Pro Tem Caroline Torosis questioned the permanent elimination of the ban on fast food chains, given that the city’s goal has been to attract “distinctive, locally owned businesses to the Promenade.” Staff explained that they simply wanted to open up the downtown to all varieties of restaurants.
Torosis also inquired how including pawn shops back into the downtown aligned with the city’s economic development goals and creation of a sense of place. When city staff again answered that it was simply to create greater flexibility, Torosis stated, “I’m going to be honest, I don’t feel delighted about that.”
Mayor Lana Negrete, on the other hand, sounded baffled as to why pawn shops had been excluded from downtown in the first place.
In addition, Torosis wanted to make sure that the loosening of alcohol provisions did not extend to hotel operations, which city staff confirmed.
“I would like to see a removal of hotels, motels, bed and breakfasts, and liquor stores as permitted uses on the Third Street Promenade without a CUP,” said Councilmember Dan Hall. He added, “I’m also not interested in pawn shops being allowed to relocate in downtown.” He humorously doubted that there is a crisis in secondhand baseball cards or diamonds that needed to be addressed. He also stated that while he isn’t opposed to what are known as “fast casual” restaurants, he does not want to see any of the larger, well-known fast food chains populating downtown.
Negrete noted that attempts to cherry-pick which fast food chains were permitted in the past have caused problems. Councilmember Ellis Raskin supported Hall’s comments, except for the fast food part, citing the need for more flexibility now to revitalize downtown.
Hall then formally moved for acceptance of the proposed changes, acceptance of permanent measures, and for hotels, motels, bed and breakfasts, and liquor stores on the Promenade to require a CUP. He also added to now allow pawn shops to relocate in the downtown district, but left out a fast food ban, citing a lack of support. It was seconded by Councilmember Barry Snell.
The motion passed unanimously, 7-0.
