Item 7-A

Council Mtg: 12/9/97                         Santa Monica, CA

TO:       Mayor and City Council

FROM:     City Staff

SUBJECT:  Appeal 97-019 of Planning Commission Conditions of
          Approval of Conditional Use Permit 97-012 to Allow a
          Modification to an Existing Restaurant/bar with an
          Approved Type-47 (On-Sale General for Public Eating
          Place) Alcohol License at 1446 Third Street Promenade. 
          Applicant: L. Elizabeth Strahlstrom, Esq./ Chillers
          Restaurant.  Appellant:  L. Elizabeth Strahlstrom,
          Esq./ Chillers Restaurant.

INTRODUCTION
This report recommends that the City Council deny the appeal and
uphold the Planning Commission conditions of approval of
Conditional Use Permit 97-012.  On September 17, 1997, the
Planning Commission approved the application's request to allow
dancing within the existing establishment with the conditions
that the dancing be limited to twelve events per year, that a
Temporary Use Permit be obtained for such events, that there be
no cover charge, and that the applicant install the sound
proofing improvements required by the Noise Ordinance for
establishments with live entertainment and dancing.  The
Commission also granted the applicant's request for extended
hours of operation.  The Planning Commission staff report and
Statement of Official Action are contained in Attachment A.  On
October 1, 1997, the Planning Commission action was appealed by
the applicant to the City Council.  The appeal statement is
contained in Attachment B.

BACKGROUND
The original Conditional Use Permit for Chillers was approved in
February 1990.  The CUP allowed the restaurant to have a seating
capacity of 212, limited hours of alcohol service (midnight at
the bar and 1:00 a.m. within the restaurant dining area),
permitted a Type-47 (On-Sale General Alcohol) liquor license
which required full meal service, and no dancing or live
entertainment.  

In June, 1997 the applicant filed an application to amend the
existing CUP to allow the sale of alcohol throughout the
establishment until 1:30 a.m. daily, allow the addition of a 440
square foot dance floor accompanied by amplified disc jockey (DJ)
music, and allow the establishment to impose a cover charge. 
Based on the Zoning Ordinance definition of a nightclub, the
addition of the dance floor and cover charge to the existing
restaurant would result in the establishment being converted to a
nightclub.  Any nightclub established after 1992 requires
compliance with the City's Noise Ordinance, which would have
required Chillers to upgrade the existing facade windows to
double pane and provide a double-door vestibule at the entrance
to the establishment.  The applicant had originally requested a
Noise Variance to waive the soundproofing requirements for
nightclub uses.  However, prior to the Planning Commission
hearing, the applicant withdrew the Noise Variance application.

Planning Commission Action
Planning Staff had originally recommended that the Planning
Commission approve the applicant's application for extended hours
of operation, but deny the request to convert the existing
restaurant to a nightclub.  At their meeting on September 17,
1997, the Commission approved a modification to the existing CUP
to allow Chillers to extend their existing alcohol service hours
and add limited dance events.  The approval allowed the applicant
the opportunity to hold up to twelve dance events per year, but
prevented the establishment from operating as a nightclub on a
permanent basis.  The majority of the Commission members were
concerned with the restaurant's past history of alcohol related
problems and did not feel an additional nightclub use on the
Third Street Promenade would be appropriate. 

While the Commission did not approve the conversion of the
restaurant to a nightclub, they did allow for up to twelve dance
events per year.  The Commission felt that the twelve events
would allow for a reasonable compromise by giving the applicant
the opportunity to hold special events for certain holidays and
special occasions.  The Commission appreciated the effort that
the applicant had made over the last year to improve their
operation, but felt that a year was not enough time to ensure
that problems of the past would not reoccur at the restaurant. 

Applicant's Appeal
The applicant has appealed the Planning Commission conditions of
approval which limit the number of dance events to twelve per
year, prevent the imposition of a cover charge, and require the
soundproofing of the establishment.  The applicant contends that
it is unreasonable to require the soundproofing for a limited
number of events and that, without a cover charge, the expense
incurred to upgrade the building's sound insulation would not
permit a reasonable return on their investment. 

APPEAL ANALYSIS
The applicant had requested an amendment to the existing CUP to
allow the sale of alcohol throughout the establishment until 1:30
a.m. daily and allow the addition of a 440 sq. ft. dance floor
accompanied by amplified d.j. music.  The applicant's objective
was to maintain hours of alcohol service consistent with most
other establishments on the Third Street Promenade and upgrade
the restaurant/bar to a nightclub use. 

While the Planning Commission felt that the increase in the
restaurant's permitted hours of operation to 1:30 a.m. was
reasonable given the restaurant's 2:00 a.m. closing time, the
Commission did not feel that the conversion of the establishment
to a nightclub was appropriate.  The Commission's concerns were
related primarily to the current level of activity on the
Promenade and the previous history of alcohol related violations
at the restaurant.

The proposed change in use from a combination restaurant/bar to a
nightclub would add an additional nightclub to the 1400 block of
the Promenade, resulting in two nightclubs in the 1400 block of
the Promenade and a total of six nightclubs within the Bayside
District.  There is currently one nightclub in each of the three
blocks of the Promenade, with the other two nightclubs located on
Fourth Street and on Broadway.  Given the existing number of
nightclubs on the Promenade, the Planning Commission expressed
concern about the current level of activity on the Promenade and
felt that the addition of another nightclub to the 1400 block may
negatively impact the ambiance of the area. 

In adopting the current limit on the number of food uses and
alcohol outlets in the Bayside District, the City Council
expressed a desire to limit the types of alcohol outlets to full-
service restaurants where entertainment is incidental to the
primary use of the establishment.  The conversion of the existing
restaurant to a nightclub would create an alcohol outlet where
dancing is permitted, which goes beyond the definition of a
restaurant.  Given the direction of the City Council and the
existing number of nightclubs in the Bayside District, the
Planning Commission denied the applicant's request to convert the
existing restaurant to a nightclub. 

Previous History of Restaurant
Prior to the Planning Commission meeting, staff met with the
Santa Monica Police Department regarding the applicant's request. 
A representative from the Police Department stated that, while
there have been numerous problems at Chillers since the
establishment opened, including alcohol sales to minors,
violations of various CUP conditions, and unruly behavior of
patrons, the Police Department has worked with the management to
address the problems, and that over the past several months, the
operation has improved.  Based on the improved conditions, the
Police Department supported the request under certain conditions. 
Their primary concerns regarding allowing a nightclub use was to
require soundproofing for the establishment if an amplified sound
system was approved, and  controlling the crowd entering the club
after the hours of 10 p.m.  The SMPD in their memo to staff dated
July 24, 1997 (Attachment C) conditionally supported the change
in use if a periodic monitoring condition were included in the
approvals.

Although the Police Department supported the project, the
Planning Commission still had concerns about the applicant's
request to convert the facility to a nightclub.  The Commission
stated that they appreciated the effort that the applicant had
made over the last year to improve their operation, but that a
year was not enough time to ensure that problems of the past
would not reoccur at the restaurant.  Furthermore, the Commission
expressed a concern that the Police Department's support for the
project was based on the recent history of the current operators,
and because the approvals run with the land, there is no ability
to control who operates the establishment in the future.    

The Planning Commission denied the applicant's request to convert
the existing restaurant to a nightclub based on their concern
about the existing level of activity on the Promenade and the
previous history of the establishment.  The Commission felt that
the allowance for up to twelve events per year was a reasonable
compromise, but that in order to hold these events, the applicant
be required to install the noise insulation improvements required
for establishments with entertainment and dancing, and in order
to maintain the establishment as a restaurant, the applicant not
be allowed to impose a cover charge.

Planning staff had originally recommended that the Planning
Commission approve the applicant's request to extend their hours
of alcohol service, but deny their request to convert the
facility to a nightclub.  In an effort to reach a compromise
solution, the Commission approved dancing at the restaurant on a
limited basis.  While staff had not recommended the twelve events
per year, staff supports the Planning Commission approval and
feels that the allowance for the twelve events will give the
applicant an opportunity to display their ability to operate the
restaurant with dancing.  Furthermore, the condition that the
events only be allowed subject to the approval of a Temporary Use
Permit provides the City Planning Division an opportunity to
closely monitor the events.  Staff also agrees with the Planning
Commission requirement that the events only be allowed if the
facility is sound insulated to comply with the Noise Ordinance
for establishments where entertainment and dancing occurs.  This
requirement will ensure that the facility does not contribute to
the existing noise level on the Promenade.  Additionally, staff
agrees with the Planning Commission's condition which prohibits
the applicant from imposing a cover charge.  A cover charge would
discourage dining patrons from entering the facility and further
define the operation as a nightclub.

CEQA STATUS
The proposed request is categorically exempt pursuant from the
State CEQA Guidelines in that the addition of a dance floor, disc
jockey music and modified hours of operation to an existing
restaurant is considered Class 1, i.e., a minor alteration to an
existing facility.

BUDGET/FINANCIAL IMPACT
The recommendation presented in this report does not have any
budget or fiscal impact.                                                                  

RECOMMENDATION
It is respectfully recommended that the City Council deny the
appeal and uphold the Planning Commission action on Conditional
Use Permit 97-012 with the following findings and conditions:

FINDINGS:
     1.   The proposed nightclub use is one conditionally permitted
     within the subject district (BSC-1 in the Bayside District
     Specific Plan); however, the proposed change from restaurant
     to nightclub operations will result in a second late-night
     entertainment facility within the 1400 Block of Third
     street, (a restaurant/bar and billiards hall was approved
     with dancing/cover charges, i.e. "nightclub"@ Gotham Hall
     1429-1431 Third Street), which would result in an over
     concentration of such uses in the 1400 block of the
     Promenade.  Because the existing restaurant is currently
     permitted to be open until 2 a.m., the proposed change in
     the hours of alcohol service will not change the character
     of the restaurant.  

     2.   The proposed nightclub use would impair the integrity and
     character of the district in which it is to be established
     or located in that the addition of a sixth nightclub within
     a nine block area (an entertainment facility which may
     provide dancing, taped or live music and charge a cover
     charge) would result in an over concentration of such
     facilities.  However, the extension of alcohol service hours
     from 1 a.m. to 1:30 a.m. in the dining room and from
     midnight to 1:30 a.m. in the bar will not impair the
     integrity of the district in that the extended hours of
     alcohol service are consistent with other establishments
     within the area that are permitted to be open until 2 a.m..

     3.   The subject parcel is physically suitable for the type of
     land use being proposed in that it is a standard parcel with
     no unusual characteristics and the extended hours of alcohol
     service will not change the character of the existing
     restaurant.

     4.   The proposed extended hours of alcohol service are
     compatible with any of the land uses presently on the
     subject parcel, in that the present land use is a restaurant
     which is permitted to be open until 2 a.m. daily, and the
     service of alcohol until 1:30 a.m. will not change the
     character of the establishment.

     5.   The proposed nightclub use would not be compatible with
     existing and permissible land uses within the district and
     the general area in which the proposed use is to be located,
     in that the zoning of the site conditionally permits the
     issuance of an alcohol license for food service
     establishments with alcohol licenses. However, it is the
     City's intent to limit such outlets per block and the
     addition of a sixth nightclub venue to the District would
     overburden the City's existing capabilities to provide
     adequate public safety, zoning enforcement, and noise
     protections for the mix of uses currently existing on the
     Promenade and the residents who live within the area.  The
     proposed extension of alcohol service hours is compatible
     with existing and permissible land uses within the district
     in that the hours are consistent with other similar uses on
     the Promenade which are open until 2 a.m.  

     6.   There are adequate provisions for water, sanitation, and
     public utilities and services to ensure that the proposed
     use would not be detrimental to public health and safety in
     that the proposed expansion of alcohol service hours to 1:30
     a.m. are to an existing facility and no additional demand on
     public utilities and services is anticipated.

     7.   Public access to the proposed use shall be adequate, in that
     the restaurant is located in the Bayside District which is
     adequately served by existing roads, transit  and parking
     structures. 

     8.   The physical location or placement of the use on the site is
     not compatible with and does not relate harmoniously to the
     surrounding neighborhood in that the addition of a sixth
     nightclub in the Bayside District and a second nightclub on
     the 1400 block of the Promenade would result in an over
     concentration of such uses in the area.  The extension of
     the alcohol service hours will relate harmoniously to the
     surrounding neighborhood in that the restaurant is currently
     permitted to be open until 2 a.m. and the additional alcohol
     service hours will not change the character of the
     restaurant.

     9.   The proposed extended hours of alcohol service are
     consistent with the goals, objectives, and policies of the
     General Plan in that the Land Use Element of the General
     Plan encourages restaurants and uses that attract nighttime
     activity.

     10.  The proposed nightclub use would be detrimental to the
     public health, safety, convenience, and general welfare in
     that the proposed nightclub is not consistent with the
     Bayside District Specific Plan, which encourages a mix of
     uses including restaurants and residential uses which serve
     both residents and visitors, and an additional nightclub
     with amplified music and dancing within the 1400 block of
     Third Street is not compatible with residential uses.  The
     proposed expansion of alcohol hours would not be detrimental
     to the public health, safety, convenience, and general
     welfare in that the existing restaurant is permitted to be
     open until 2 a.m. and the extension of alcohol hours will
     not change the character of the restaurant.

     11.  The proposed use conforms precisely to the applicable
     performance standards contained in Subchapter 9.04.12 in
     that no Performance Standard Permit is required.

     12.  The proposed nightclub use will result in an over
     concentration of such uses in the immediate vicinity in that
     the proposed facility would result in six nightclubs in the
     Bayside District and two nightclubs on the Third Street
     Promenade, which is inconsistent with the City's goal to
     encourage restaurant uses where the consumption of food is
     the primary activity and alcohol service and entertainment
     is ancillary.  The proposed extension of the hours of
     alcohol service will not result in an over concentration of
     such uses in that the use is an existing restaurant which is
                                                  currently permitted to be open until 2 a.m..      

CONDITIONS:

     1.   The restaurant hours of operation shall be limited to 11:00
     a.m. to 2:00 a.m.

     2.   No alcoholic beverages shall be sold prior to 11:00 a.m.
     daily or after 1:30 a.m. daily.

Plans
     3.   This approval is for those plans dated September 21, 1997, a
     copy of which shall be maintained in the files of the City
     Planning Division.  Project development shall be consistent
     with such plans, except as otherwise specified in these
     conditions of approval.

     4.   The Plans shall comply with all other provisions of Chapter
     1, Article IX of the Municipal Code, (Zoning Ordinance) and
     all other pertinent ordinances and General Plan policies of
     the City of Santa Monica.

     5.   Minor amendments to the plans shall be subject to approval
     by the Director of Planning.  A significant change in the
     approved concept shall be subject to Planning Commission
     Review.  Construction shall be in conformance with the plans
     submitted or as modified by the Planning Commission,
     Architectural Review Board or Director of Planning.

     6.   Construction period signage shall be subject to the approval
     of the Architectural Review Board.

     7.   Plans for final design, landscaping, screening, trash
     enclosures, and signage that differs significantly from that
     approved for the original building shall be subject to
     review and approval by the Architectural Review Board.

Validity of Permits

     8.   In the event permittee violates or fails to comply with any
     conditions of approval of this permit, no further permits,
     licenses, approvals or certificates of occupancy shall be
     issued until such violation has been fully remedied.

     9.   Within ten days of Planning Division transmittal of the
     Statement of Official Action, project applicant shall sign
     and return a copy of the Statement of Official Action
     prepared by the Planning Division, agreeing to the
     Conditions of approval and acknowledging that failure to
     comply with such conditions shall constitute grounds for
     potential revocation of the permit approval.  By signing
     same, applicant shall not thereby waive any legal rights
     applicant may possess regarding said conditions.  The signed
     Statement shall be returned to the Planning Division. 
     Failure to comply with this condition shall constitute
     grounds for potential permit revocation.

     10.  This determination shall not become effective for a period
     of fourteen days from the date of determination or, if
     appealed, until a final determination is made on the appeal. 
     Any appeal must be made in the form required by the Zoning
     Administrator.

ALCOHOL OUTLET CONDITIONS

     11.  A special dancing permit (e.g. a Temporary Use Permit) shall
     be obtained for a maximum of 12 events per calendar year
     though the City Planning Division.  The applicant shall pay
     the applicable fee for this application for every filing;
     however 12 calendar events may be filed with one
     application.  The application shall include an annual
     tentative dance event schedule. Any modifications to this
     schedule must be reviewed and approved by the Director of
     Planning and Community Development and SMPD (Vice Division)
     prior to the dance event for that calendar year.   Prior to
     holding the first dance event, the applicant shall be
     required to secure building permits to sound proof the
     building per the Noise Ordinance guidelines (e.g. upgrade
     the building with double pane glass window and provide a
     double door entrance vestibule and insulate any common
     building walls).  The Director of Planning and Community
     Development shall review and approve said plans.  The music
     for the dance events shall be pre-recorded and may be
     orchestrated by a disc jockey (DJ).  This permit provides
     for a limited dance venue in conjunction with the existing
     restaurant alcohol license, therefore the establishment
     shall be defined as a restaurant and not be permitted to
     collect a cover-charge for operation of the dance venue.    

     12.  The latest hour for serving alcoholic beverages in the
     outdoor dining area shall be 11:30 p.m. (food service may
     continue), or no later than the closing of the associated
     food service of the establishment, whichever is first.  All
     alcoholic beverages must be removed from the outdoor dining
     area no later than 12:00 midnight.  

     13.  The owner shall control noisy patrons leaving the
     restaurant.

     14.  The premises shall have the capability to serve food to
     patrons during all hours the establishment is open for
     customers.

     15.  The premises shall maintain a kitchen or food-serving area
     in which a variety of food is prepared and cooed on the
     premises.

     16.  Seating arrangements for all floor areas shall not exceed
     212 seats and the number of total seats shall not be
     expanded by more than 10% unless approved by the Director of
     Planning.

     17.  Take out service shall be only incidental to the primary
     sit-down use.

     18.  No alcoholic beverage shall be sold for consumption beyond
     the in-door or out-door premises.

     19.  No live entertainment shall be permitted on the premises. 

     20.  Final plans for any changes to exterior design, landscaping,
     trash enclosures, and/or signage shall be subject to review
     and approval by the Architectural Review Board.

     21.  Minor amendments to the plans shall be subject to approval
     by the Director of Planning.  An increase of more than 10%
     of the square footage or a significant change in the
     approved concept shall be subject to Planning Commission
     Review.  Construction shall be in substantial conformance
     with the plans submitted or as modified by the Planning
     Commission, Architectural Review Board, or Director of
     Planning.

     22.  The applicant shall comply with all legal requirements
     regarding provisions for the disabled, including those set
     forth in the California Administrative Code, Title 24, Part
     2.

     23.  Refuse areas, storage areas, and mechanical equipment shall
     be screened in accordance with Sec. 9127J.2-4 (SMMC). 
     Refuse areas shall be of a size adequate to meet on-site
     need.

     24.  The operation shall at all times be conducted in a manner
     not detrimental to surrounding properties or residents by
     reason of lights, noise, activities, parking, or other
     actions.

     25.  No noise generating compressors or other such equipment
     shall be placed adjacent to neighboring residential
     buildings.

     26.  The conditions of this approval shall supersede all previous
     approvals on this property including CUP 89-100.

Prepared by: Suzanne Frick, Director
          Karen Ginsberg, Planning Manager
          David Martin, Senior Planner
          Gina Szilak, Assistant Planner
          Planning and Community Development Division

Attachments (Available at the Santa Monica City Clerk's Office or
at any of the Santa Monica Public Libraries):

                         A.   Planning Commission Staff Report and Statement of
               Official Action
                         B.   Appeal Statement
                         C.   Memo from Santa Monica Police Department dated
               7/24/97
                         D.   Project Plans