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Chain Reaction: Biz Owner Sees Inconsistencies in Subway Denial

As City Hall ponders “formula” business regulations, apparent inconsistencies in recent decisions cause some to ask for a clearer idea of what is a chain and how far should the city go to protect locally owned businesses. What do you think?

When the Mill Valley City Council earlier this month, the decision drew a burst of applause from a standing-room-only crowd mostly full of vehement opponents to the sandwich shop.

But when longtime Mill Valley resident and co-owner Mark Fong learned of the decision, particularly the council citing Subway’s status as a chain and its potential impact on locally owned businesses as a basis for its decision, he was confused.

“It bothered me, and it has bothered a lot of my customers,” Fong said.

That’s because five months before Subway’s appeal was rejected, the Planning Commission , the 43-store chain owned by Strawberry resident Michael Levy, to open an approximately 4,500-square-foot Mill Valley store in the Alto Plaza shopping center. The store opened last week.

Fong said he doesn’t understand why city officials said they wanted to protect local businesses like and from a powerful chain while not doing so for his business, which has been on Miller Avenue for 31 years. Critterland is a longtime supporter of , and the , Fong said.

“I just don’t get the difference,” he said.

Mill Valley native Brian Murphy, who recently moved back to town, on Mill Valley Patch: “Must we break the news to the NIMBYs that was a national chain, as well? A town must provide varied services to varied tastes, not just what fits your 1 percent tastes.”

For Sylvia "Chipps" Newsom Barsky called out for leadership from city officials.

“It is time that City Hall defined what constitutes a chain and then stand by it when a chain store wants to come into the downtown area of Mill Valley,” . “Yes, there are chains already here. How many more do we need? And at what cost? It is time for City Hall to step up and make a clear decision so that the citizens and merchants don't have to continually defend the unique culture of Mill Valley.”

Though he voted to reject the Subway appeal, Councilman Ken Wachtel said he found it curious that those people who opposed Subway because it was a chain and would negatively impact local businesses never raised an objection to Pet Food Express.

“While I am not generally a fan of protectionism, I am in favor of consistent policy -- especially when it impacts on our small locally owned and local serving businesses,” Wachtel said.

The distinction, according to the council’s decision, is two-fold:

  1. Geographic. The city’s 1989 General Plan, which is in the midst of an update, calls downtown “the primary commercial and civic center for the community” that has a “number of small businesses operated by independent proprietors who are actively involved in the community.” That priority is not explicitly extended to shopping centers like Alto Plaza.
  2. Size. Councilmembers called out the difference between Subway’s 37,000-plus locations and those of smaller chains. 

Geographic distinctions exist elsewhere like San Francisco, where chain businesses face strict regulations in some neighborhoods but much less so in some retail developments.

“My sense is that if we had tried to open in downtown (Mill Valley) it would have been more difficult,” said Levy, who founded Pet Food Express in 1980. “Alto Plaza is a shopping center and it’s distinctly different than downtown Mill Valley.”

As for the size distinction, the Planning Commission met again last month to continue its tweak of the city’s zoning regulations, including . In the latest iteration of those proposed changes, chain businesses were defined as those having seven or more locations and standardization of design, services and products.

Levy said the size distinction is a particularly subjective measurement. He said a locally owned business shouldn’t be penalized for having great success and expanding beyond the seven-location chain trigger.

“It’s a real balancing act in defining a chain,” Levy said. “In Mill Valley, I don’t want to see local businesses chased out by Burger King and McDonald’s either. But , for instance, is not the same thing as McDonald’s.”

As for Fong, his business has survived the continued economic downturn of the past several years and he hopes to continue to do so. He said there isn’t much overlap between Critterland and Pet Food Express, as he focuses less on dog and cat food and offers supplies for a wider range of pets beyond dogs and cats.

Levy agreed, saying he was confident that his new Mill Valley store won’t take out Critterland, in Strawberry or in Tam Junction. Instead, he expects to grow the local pet market by encouraging pet adoptions and allowing customers to choose from a diverse range of independent pet supply retailers.

“It’s not like we want to beat each other’s brains out,” he said. “We’ve never pushed anybody out of business - we’ve expanded the market,” he said.

Fong is hopeful but said he’d like to see some clarity from the city regardless.

“I’ve been here my whole life,” he said. “If you say you want to protect locally owned businesses, be consistent with it.”

Gardner Robinson May 24, 2012 at 02:01 PM
This became a debate and a resulted in a confusing issue for one reason only. The City Council did not have (and does not have) a clearly defined a policy in the General Plan that identifies its position for/against chain stores for downtown Mill Valley versus surrounding Mill Valley. Subway was given every impression that their application would be accepted, until the residents appealed, which was clearly misleading and in contrast to many people's expectations and understanding of what Mill Valley is. Both the City Council and the Planning Commission, with the support of the town, voted unanimously to protect downtown Mill Valley from opening a Subway. Seems they ought to put the learning from that decision into the General Plan, so as to solidify their judgement and more importantly, eliminate further confusion, as this will not be the last downtown store front vacancy to attract the interest of a chain.
katy Kuhn May 24, 2012 at 02:18 PM
A note to pet owners: vote with your wallets. Pet Pro and Critterland are committed to Mill Valley... I plan to remain committed to them!
Sherran Moyer May 24, 2012 at 02:57 PM
I couldn't agree more with Katy Kuhn. If we prefer to have locally-owned businesses thrive, then you have to give them your business. It's really that simple. It shouldn't take a City Council or any other entity to make that choice for you.
Dolly Lanna May 24, 2012 at 03:32 PM
The Pet Food Express is owned by a local and is not directly downtown. That is one huge difference. However, I do understand why Critterland would be concerned. "Express" will take customers away. I go to Critterland and hopefully they will survive. they will have to try harder to bring in customers. It is important to keep the small businesses. Our downtown is starting to become a Rodeo Drive of clothing stores, none of which I frequent. So we get either too expensive or chain? It is confusing isn't it?
Steve McNamara May 24, 2012 at 04:09 PM
Jim - Good story -- well researched and written. Good job.
Bob Silvestri May 24, 2012 at 05:08 PM
There's no question that the General Plan could and should be improved in defining and providing guidelines and processes to deal with chain and franchise stores. However, the City Council's decision on Subway was actually fairly straightforward. The General Plan makes a clear distinction between downtown MV / Lytton Square and outlying areas, with more restrictions against "national" chains that can unfairly compete on price and put smaller, locally owned businesses at a disadvantage. What is most disturbing to me in this article is that Ken Wachtel (who is a lawyer) continues to politically posture about being "confused" about the distinction between downtown and places like the Alto Shopping Center. He knows better.
L. Haugen May 24, 2012 at 05:14 PM
I'm so glad you guys covered this. I felt totally frustrated by what seemed to be the city's hypocritical standpoint on no chains... I would like to point out though, Pet Food Express kinda just snuck in there! A lot of people I know are surprised how it just moved in and no one noticed or heard till it was a done deal. I feel like there are so many mom and pop pet stores to try to support in Mill Valley as it is...I was surprised that Pet Food Express came in. However, I do think there is something to be said about the Owner of Pet Food Express being a local Strawberry resident. I would want my business to have a location in my local town too. As it stands though, I will continue to support the business I hope will remain in town; voting with my wallet as well.
Cathy Rosekrans May 24, 2012 at 05:47 PM
LOVE CRITTERLAND! I guess downtown Mill Valley is pretty "precious" - in that, with some exceptions (Mill Valley Market, Tony's Shoe Repair), its a place to buy non-necessities like upscale clothes, furniture, jewelry. Great place for out of towners to shop or to buy gifts. From a traffic standpoint, this is not desirable and I personally think local serving should be an emphasis of any ordinance. Downtown is just too much! Miller Avenue has been the place to serve LOCALS in the past General Plan - and I hope that remains going forward. Good from a traffic and quality of life standpoint. WE LOCALS NEED CRITTERLAND! This all needs more clarity but good luck crafting something that keeps our existing local serving businesses thriving. That should be a main goal. PS: Whole Foods is a chain and it was very controversial coming in (at Miller) when it replaced a small non-chain business. Traffic concerns mostly, but also related to small town character.
JJLease May 24, 2012 at 05:54 PM
My first reaction to seeing the Pet Food Express come in was surprise as well, in light of Subways rejection. There might be an explaination of this cited in the General Plan, but to me its common sense. We can allow one big chain in one part of Mill Valley, and not allow one in the other? Locally owned or not, there has to be some sort of policy that says what is acceptable and fair.
Mari May 24, 2012 at 05:57 PM
Agreed! I miss General Hardware.
Chaler May 24, 2012 at 05:59 PM
The location of the chain owner's residence should be completely irrelevant. If chains are bad, they are bad no matter where the owner lives. Pet Food Express is clearly a chain--look at their web site to see the many dozens of locations. What if the owner of the Subway chain lived here? Would that carry any weight?
James Iavarone May 24, 2012 at 06:55 PM
There's a lot of hypocracy and nonsense surrounding efforts to keep out a chain like Subway. If Subway was kept out "to protect local businesses," does that mean no sandwich shop or deli could go into that location even if it was an independent local proprietor? Of course not. So protectng local businesses was not and cannot be a reason to keep someone out. Unless the town is trying to say that Subway is a brilliantly run concept shop that the townspeople would flock to, while the local guy would probably be some schlub who couldn't compete very well. The fact is that Subway has a gaudy yellow sign that some fussy townspeople don't like to look at. If I was the guy who wanted to open that shop, I would come back to the town and apply as "Ye Old Sandwich Shop" and run it like a Subway.
teresa May 24, 2012 at 07:36 PM
I'm certainly not a chain-store fan, but I'm finding it hard to understand all the confusion and outrage about Pet Food Express - aren't we talking only about downtown? Do people confuse the Alto Plaza shopping center with downtown? There are many chains in and around Mill Valley, but they're fortunately not in the town center. Speaking of downtown, why isn't anyone picking on Peets Coffee? Or maybe even Title Nine? Did previous downtown chains Baskin Robbins, Banana Republic, and Noah's Bagels see as much opposition as Subway did? I think one Subway in town (Tam Junction) is plenty, but I'm just curious if past attitudes were as passionate as they are today...
Mari May 24, 2012 at 07:47 PM
What is the point of having anything clearly defined in a community plan if it is applied in some cases and not others? Take for example, the Tamalpais Area Community Plan. It states "we do not encourage sidewalks, curbs and gutters in the planning area." So, what does David Parisi do when asked by Roz Hamar, the (now former) head of Marin Horizon School, to design a sidewalk so she can convince her private school clients to walk four blocks? He designs a concrete sidewalk, with curbs and gutters! And people are surprised when there is an uproar? We have exhausted all efforts to reach a win/win solution. Not one person who claims we need a "sidewalk" has offered to join our effort for a "community built" path. We have not received a reply from County re: our proposed alternative plan. Project moves forward. We ask for notice of all actions, but get NO notice when COUNTY decides to give ITSELF an exemption from CEQA - for "existing facilities" when NO concrete sidewalk with curbs and gutters exists in this area!!! Contract has been awarded, we just receive word of a pre-construction meeting on June 7th - and find out that CONSTRUCTION is going to start on June 11th!!!
Mari May 24, 2012 at 07:49 PM
This is no benefit to schoolchildren - it is nothing but bureaucratic BS!! http://www.change.org/petitions/no-million-dollar-slab-for-evergreen-ave
Bob Silvestri May 24, 2012 at 07:52 PM
The banks and Stefanos downtown predate the current General Plan / these companies came in before the GP was written.Of the other "chains" in downtown, Peets was not a "national chain" at the time of its approval (as specifically noted in the General Plan: 2.4.1 Existing Conditions and Projections: Mill Valley / Tamalpais Area Planning Factors - Page 52). And even if the approval of Peets or any other business was faulty in the past (didn't conform to the GP requirements) it's not an argument to continue to not enforce the GP. Of the others Champagne has less than ten outlets even today, Margaret O'Leary was a new retail venture when approved and to date only has 8 stores (and Margaret O’Leary lives in Mill Valley, downtown on Throckmorton), Tyler Florence is just now starting to go into retail (and Tyler also lives here in Mill Valley). Boo Koo is not a chain (and its owner lives in Mill Valley on Sunnyside). Boo Koo started as a sister to another restaurant in Santa Cruz (Charlie Hong Kong), but separated last year. And Alain Pinel is a relatively new real estate company, which is only in Northern California from Napa to Monterrey. Subway on the other hand surpassed McDonalds in 2010 as the largest franchisor in the world (36,000 locations). Subway is clearly the type of business that the GP was contemplating regarding the threat of the unfair competitive advantages of national chain stores and franchises driving out small locally owned businesses.
John May 24, 2012 at 08:33 PM
Bos Silvestri has nailed the issue in both of his posts. Regulations for the downtown retail district are and should be different from those for shopping centers away from downtown. Baskin Robbins also predated the current General Plan, and denying a huge chain such as Subway is consistent with the way the General Plan is currently implemented. The denial was not so much to protect specific businesses as to prevent the camel's nose (huge formula retail chains) from entering the tent (the downtown retail district), and setting a precedent for post-general Plan approvals. Even if one approves of Subway, denial of its application was necessary to preserve the intent of the General Plan and the wishes of most of the City's residents to preserve the unique flavor of downtown, as demonstrated by the numbers who turned out and signed petitions in opposition to Subway's application.
jerry slick May 24, 2012 at 10:36 PM
Nobody ever accused Whole Foods of having low prices, and I just found out that my Organix dog food was 34.99 there, and 39.99 next door at Pet Food Express. So much for their so-called "discount". Won't go back. Ever.

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