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ITEM: |
PUBLIC
HEARING |
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12. |
CONSIDER REQUEST FOR
VARIANCE FROM DISTRICT RULE 20, PERMITS
REQUIRED, FOR A CHANGE OF USE FROM A DELI (GROUP II) USE TO A RESTAURANT
(GROUP III) USE 484 WASHINGTON STREET, MONTEREY (APN: 001-692-011) |
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Meeting
Date: |
March 17, 2014 |
Budgeted: |
N/A |
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From: |
David J.
Stoldt, |
Program/ |
N/A |
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General
Manager |
Line Item No.: |
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Prepared
By: |
Stephanie
Pintar |
Cost Estimate: |
N/A |
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General Counsel Review: Yes |
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Committee Recommendation: N/A |
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CEQA Compliance: N/A |
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A public hearing on
an appeal of a staff decision to require a Water Permit for a Change in Use at
484 Washington Street, Monterey, was heard by the Board on February 13, 2014.
The Board closed the public hearing and continued the appeal to March 17, 2014,
to allow the appellant an opportunity to apply for a variance (Exhibit 12-A).
The staff report and exhibits from the February 13, 2014, meeting are provided
as Exhibit 12-B. The following report
responds to the request for a variance. The Board must make a decision on the
variance request before making a determination on the appeal.
SUMMARY: Mr. Uwe Grobecker, owner of the Santa Lucia Café (formerly the Santa Lucia Market) is requesting a variance from District Rule 20, Permits Required, (Exhibit 12-C) to allow continued operation of 484 Washington St., Monterey, as a Group II (deli) use using china and silverware and offering full table service. The business was established with a Water Permit in 1997 for Group II deli use. In October 2013, District staff sent notice to the appellant that the business was operating as a full-service restaurant and required a Water Permit for a Change in Use (Exhibit 12-D). That action was appealed to the Board and considered in February 2014.
In requesting a variance, the appellant cites the following reasons the Board should allow him (and future tenants) to continue the existing business operations:
1. The
District’s regulations are unclear regarding limitations on Group II food
service;
2. There
was no notice of violation (or inspection) until after the business had been in
operation for more than 15 years;
3. There
has been no change to the number of fixtures or equipment that would increase
water use once the business opened in 1997;
4.
It is unlikely that a Group II use at this site would exceed
the water use capacity due to the small size of the lease space.
RECOMMENDATION: The Board should consider whether granting a variance is appropriate. Does the property owner’s refusal to record the Conditions of Approval on the property title affect that decision? As the location of this variance is a lease space, it is possible that future tenants may not be notified of the restrictions in use.
The Board must adopt either Findings of Approval or Denial of a Variance as part of its decision on this matter. The Board must also make a determination on the appeal that was continued from the February 13, 2014 meeting. Staff recommends the appeal be denied. In denying the appeal, the Board should adopt the Appeal Findings of Denial provided in Exhibit 12-K.
Staff also recommends that the Water Demand Committee be tasked with reviewing the need for definitions for food service uses listed under Group I and Group II, and if needed, develop definitions and/or guidelines to prevent future similar situations.
Please note Rule 181 requires the Board to disclose any oral or written ex parte communications they may have received from effected parties on all quasi-judicial actions such as this item.
DISCUSSION: District Rule 20 requires a Water Permit prior to
Change of Use or Expansion of Use. The District’s practice since the 1980’s has
been to describe a deli as a business that sells
(primarily) take-out food and other items, but that does not offer full service
and serves food on disposable plates. Staff understands that delis today offer
a wider and fresher menu than years ago, when the sale of made-to-order sandwiches
and pre-prepared dishes, cold cuts, salads and pizza were the standard. Today,
they not only serve the previously listed items, but may also serve salads, hot
foods and drinks, and/or prepare party trays to go. Deli stores vary greatly in
size and in the ratio of retail sales to food sales. In order to provide an
opportunity for a complete meal, delis often offer a wide variety of beverages,
usually pre-packaged soft drinks, coffee, tea, milk, etc. Potato chips and
similar products are available in some variety – some pre-packaged, others
store-made and cellophane wrapped. The District does not have written
definitions for commercial uses and relies on the Water Permit applicant to
accurately account for the type of business being permitted.
In the case of Santa Lucia Market, a Commercial Water Release Form/Water Permit Application was submitted to the District by the appellant on February 11, 1997. This document can be found in Exhibit 12-E. The application identified the proposed project as “deli/retail food.” The appellant unconditionally accepted the terms of the Water Permit issued February 11, 1997. Both documents were signed by the appellant and clearly identify the proposed use as deli/retail.
The business is currently for sale, and in October 2013, District staff met with the appellant to discuss the functions of the business and the Water Permit requirements. The appellant provided a summary of the business operations and described to staff the functions as they evolved through the years. The appellant described the business in the late 1990’s as a deli use. The business consisted of mostly retail and take-out sales, including meats, cheeses and coffee, and offered deli items for consumption. The appellant stated that after the business had been in operation for some time, he removed the meat and cheese counters and replaced them with tables and chairs. The appellant also hired waitresses and expanded his menu as the business developed into a full-service eating establishment. The appellant did not seek or gain approval for a Water Permit to facilitate this changed business practice or Expansion of Use.
On October 30, 2013, the District notified the appellant that the property is not in compliance with Water Permit No. 15856 and that an amendment is required to permit the Change of Use at 484 Washington Street, Monterey. The appellant contends that he was not notified by the District of any detailed information about the allowable services when the 1997 Water Permit was issued to allow the deli use. He contends that when he paid for the Change of Use to a deli, he was not specifically notified of the restrictions on providing full service and the use of china and silverware. Therefore, he requests a variance to continue to provide table service and to function as a restaurant for purposes of serving hot food, liquid food (e.g. pasta and soups), and food with high moisture content (e.g. salads with dressings). He would continue operating as a deli for all other food service.
District Rule 23 requires a final inspection upon project completion. Water Permit 15856 includes a statement that a final inspection is required. As the District does not know when the project is completed, it relies on the permit holder to contact the District to arrange for the final inspection. In this case, the District was not contacted. The appellant did not request a final inspection until January 30, 2014. Had an inspection been completed and if the current practices were in place, the appellant would have been notified that the full service of meals on china was not acceptable under the existing Water Permit.
In response to staff’s request for information about current practices, the appellant provided the following information: The current business operation includes beverages served in glassware; hot food, liquid food (e.g. pasta and soups), and food with high moisture content (e.g. salads with dressings) served on china; cold foods served on disposable plates or in baskets; pizza served on a paper-wrapped paddle; silverware utensils are provided, and there is table service. Take out foods are all provided in disposable packaging. Staff confirmed this information during the January 2014 inspection (Exhibit 12-F).
The water used by the building at 484 Washington St., Monterey is provided by a master water meter serving the Group II use and other retail and office uses. Irrigation is separately metered. Based on the District’s water use factors, the water use capacity of the building and irrigation is 0.855 acre-foot annually (AFA). The property owner refused to authorize staff to review the California American Water Company water records, although based on two bills provided by the appellant, it appears that the building’s water use is below the calculated Water Use Capacity.
The appellant states in his variance application that a denial of the variance request (and requirement to secure a Water Permit for restaurant use) would be a “tremendous loss to the value of this small business and devastating to our family.” The business has recently been for sale, and staff noted that it was advertised as a restaurant. The appellant requests that the District make an exception to the rules and allow the continued operation, with some exceptions[1]. The appellant argues in support of a variance that due to lack of clarity regarding Group II water uses, the fact that there was no inspection done to note any discrepancies in the use for 17 years, and that the water usage is consistently below the Water Capacity, there are Special Circumstances and Undue Hardship.
District Rule 20 states: “A Water Permit is required for every Change in Use, including any Change of Use and any expansion of a Non-Residential use to a more intensive use as shown on Table 2 (Rule 24).” By granting a variance to an applicant that operates his business in a manner that is inconsistent with District practice (i.e., Group II food service uses disposables and does not have full table service), the Board must consider the applicability of this decision on other similar businesses.
Conditions
of Approval
Given that the Group I and Group II uses at 484 Washington Street, Monterey, appear to consume less than the Water Use Capacity of the Site, and given that the current business practices/operations of the business appear to be mid-way between full service restaurant and deli, staff prepared draft Conditions of Approval to limit the business operations of 484 Washington St., Monterey (Exhibit 12-G). In addition to restricting how food is served, the Conditions of Approval contemplate that actual water consumption is considered. As proposed, if either actual water use exceeds the Water Use Capacity or if the business is not operated consistent with current practices, there would be a requirement for a Water Permit to change the use from Group II to Group III (restaurant).
It is District practice to record Water Permit conditions and other limitations on use on the title of the property as a means of enforcement through the Notice and Deed Restriction Regarding Limitation of Use of Water on a Property. This deed restriction provides details about the specific requirements and potential compliance consequences to current and future property owners. There is also a second deed restriction that is recorded on all Water Permits that allows the District to access the water records for the property.
In preparing this report, staff discussed the potential deed restriction with Mr. A. G. Davi, the property owner. Mr. Davi is not agreeable to having a deed restriction on the property. He believes it is too restrictive. Staff discussed the property owner’s concern with the appellant, who subsequently requested that the Board consider the proposed Conditions of Approval with the first three conditions deleted. The Board will need to consider deleting the first three conditions if it approves the variance request. The General Manager recommends the Board only consider waiving the third condition, recordation of the deed restrictions.
Even with the Conditions of Approval, but without adequate enforcement, a variance allowing continued operation as a deli/restaurant could potentially allow Water Use Capacity above that expected from a Group II deli use. The District does not have the resources to regularly confirm compliance with the Conditions of Approval. Actual water use could exceed the Water Use Capacity as a result of increases in the number of customers, changes in management, menus, hours, etc. Without the water meter account holder’s authorization, MPWMD does not have the ongoing authority to monitor and enforce the amount of water consumed by a water User.
Variance
Process
District Rule 90 (Exhibit 12-H) enables the Board to exercise its discretion by granting a variance in select circumstances. Rule 90 provides, in part:
“The Board may, after holding a public hearing, in specific cases, grant a variance from any provision of the standards incorporated into these Rules and Regulations whenever it finds: (a) that Special Circumstances exist in a particular case, and (b) that practical difficulties or Undue Hardship would result from the strict interpretation and enforcement of any such standard, and (c) that the granting of such a variance would not tend to defeat the purposes of these Rules and Regulations.”
District Rule 11 provides further definition to some of the terms used in Rule 90, including “Special Circumstances” which is defined to mean “unusual, uncommon, peculiar, unique or rare situations that require Board consideration” and “Undue Hardship” which means “a condition that exists when compliance with a rule, regulation or condition poses significant difficulty when considered in light of unique circumstances related to the application.”
Rule 90 allows the Board to place conditions upon the grant of any variance. The Board must adopt findings to support any determination it makes on this variance request. Draft Findings of Approval (Exhibit 12-I) and Findings of Denial (Exhibit 12-J) are provided for consideration.
12-A Application
for Variance
12-B Staff Report from February 13, 2014 Appeal
12-C District Rule 20, Permits Required
12-D Notice of Non-Compliance
12-E Water Permit and Application
12-F District Inspection Report
12-G Draft Conditions of Approval
12-H District Rule 90, Variance
12-I Draft
Findings of Approval
12-J Draft Findings of Denial
12-K Appeal Findings of Denial
U:\staff\Boardpacket\2014\20140317\PublicHrngs\12\item12.docx