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Commission Hits Stumbling Block in Biz Regulation Overhaul

Decision is delayed by a desire for an inventory of how many downtown commercial spaces would be impact by proposed square footage trigger, and the inability to easily come up with that info.

As the Mill Valley Planning Commission kicked off its latest discussion of the city’s overhaul of commercial zoning regulations Monday night, commissioner David Rand suggested they focus squarely on the two proposed changes that have drawn the most heated debate.

“At first blush, this is a huge and unmanageable project that you could spend to the 11th of never discussing,” Commission Chair David Rand said. “We should just pick a few items and focus on them.”

One of those proposals, a requirement that any “formula business” go through the public hearing process to obtain a condition use permit, drew very little discussion and appeared to have the commission’s full support. The proposal defines a formula business as an establishment that has seven or more locations and has standardized “merchandise, services, décor, uniforms, architecture, colors, signs or other similar features.”

Discussion of the other proposal on the evening’s menu, however, faltered. The proposal is to require any new business occupying a space that is 1,500 square feet or larger to obtain a CUP.

The discussion got hung up on two issues.

Square footage

The first has been lingering for most of 2012, as the commission has unsuccessfully sought a square footage inventory of downtown commercial spaces so that they can determine how many storefronts will be impacted. Gathering that data has proved difficult, particularly because the city’s Planning Department is in the midst of managing the MV2040 General Plan update on an accelerated 18-month schedule.

Mill Valley Chamber of Commerce officials produced a 1987 downtown square footage survey that indicated that nearly 95 percent of downtown spaces are larger than 1,500 square feet. Many said that data was likely inaccurate because of configuration changes over the past 25 years.

The second issue was whether the square footage measurement should be of gross area – the total square footage, including storage, hallways and basements – or net square footage of just the space at the storefront level.

The city’s existing 1,500-square footage trigger focuses on “selling space,” a threshold that has been deemed flawed by some, particularly after Alain Pinel exploited a loophole in it by altering its floor plan for 30 Miller Ave. to make less than 1,500 square feet of its proposed real estate office accessible to the public. The move allowed the company to move ahead with its plans after it was both rejected by the Planning Commission and had its appeal denied by the City Council. The City Council eliminated a likely repeat of that by banning downtown storefront office space.

Several commissioners said that the trigger should be for net square footage, but there wasn’t consensus on that issue. As a result, the city’s pursuit of a square footage inventory will likely need to include both numbers.

“We are still working completely blind in trying to find whether or not 1,500 is a fair number,” Rand said.

While the commission will await the inventory before making a decision on the square footage trigger, it received plenty of feedback from downtown property owners.

Kristi Denton Cohen, whose 30 Miller Ave. space has been empty, save for a summertime pop-up shop, since Showroom moved to 108 Throckmorton Ave. in January, told the commission to tread lightly and not over-regulate its way to a less vibrant downtown. She said a CUP requirement for anything above 1,500 square feet of gross floor area would make it even harder to rent out spaces in a slow-to-recover economy. Zobha, a high-end yoga and active wear store, is slated to open in Denton Cohen's space on Oct. 5.

Denton Cohen said a CUP process that “is already clogged up as it is” would get even worse if many more businesses were required to go through it.

Denton Cohen said the new square footage trigger also would incite property owners to divide up their larger spaces to avoid having tenants go through CUP public hearing process.

“Please don’t Carmel-ize our town,” she said.

Downtown property owner Mike Walsh, who served on the Business Advisory Board that first recommended a different set of commercial zoning changes to the city, agreed.

“The CUP process is very cumbersome and daunting and expensive,” he said. “If you guys could figure out a way to streamline the process, that would help. To limit its use would be even better.”

Walsh noted that there was sizable room for compromise between the current proposal for a 1,500-gross-square-foot trigger and an earlier recommendation from the chamber of a 4,000-gross-square-footage trigger.

“I don’t see why the city is fixated on 1,500 square feet,” he said.

Commissioner John McCauley told property owners that a public hearing process is just that – not a prohibition – and simply a chance for the public to have a say about a new business.

“A CUP requirement is not a death knell,” he said.

Downtown resident Chris Deam agreed.

“I disagree with the CUP being viewed in a purely negative way,” he said. “It allows the Planning Commission some discretionary power to use their judgment.”

Deam argued that the CUP process was actually a way to provide new businesses with additional flexibility, crediting that process for Mill Valley Beerworks’ ability to brew beer and stay open to midnight.

“I’m confused why the business community would shoot themselves in the foot by saying we don’t want CUPs because that’s exactly the process by which you can get innovative businesses to enter your spaces,” he said.

To address concern over a longer application process for businesses when more of them need a CUP, Rand suggested the city create a “bifurcated calendar” for business CUP applications.

“My impression is that the 1,500-square-foot threshold is meeting opposition not so much because the public shouldn’t get a chance to review it but that the time it takes is costing the business and landlord too much time and money,” Rand said.

Speeding up the process?

Planning Director Mike Moore noted that two state requirements, a 30-day review of a permit application and 10 days’ notice prior to a public hearing, mandated at least 40 days of lag time after an application is filed.

“Our typical response to anyone who comes in for a CUP is two to three months,” Moore said.

More said the schedule could be sped up if the commission decided to meet every week instead of twice a month. They didn’t respond.

Chamber officials didn’t take a specific position on the two proposed regulations, choosing to submit a letter asking the commission to slow the process down and let the ongoing MV 2040 General Plan update inform the commercial zoning regulations rather than the other way around.

Commissioner Steve Geiszler, who also serves on the city’s General Plan Advisory Committee, said the consensus on the GPAC was that both processes could happen simultaneously.

“We agreed that the Planning Commission would move forward with this zoning process knowing that we might end up taking some steps back later,” he said. “But all arrows are pointing in the same direction. It’s about bringing all of these issues up and we’re getting great feedback from the community.”

Ron Vidal, co-chair of the chamber’s advocacy committee, urged the commission to get a better handle on the inventory of downtown commercial square footage before approving the square footage trigger change.

Commissioner John McCauley said the survey would allow the city to “take a harder look at square footage and adjust so that 80 percent of business are not non-conforming.”

Formula businesses

Although it didn’t generate much discussion from the commission, several residents said they remained concerned about the formula business proposal.

“You have to very, very careful about regulating formula businesses,” Denton Cohen said. “None of us wants to have a mall in downtown Mill Valley, but you have to think about the reality of what’s happening in this econ with the impact the Internet has had on small stores.”

Denton Cohen cited the ease with which customers can shop in downtown retail shops and then go find the same products online at large retailers that can afford to offer deeper discounts.

“What is the problem you think you’re solving?” longtime resident Joyce Kleiner asked the commission. “I don’t see a problem of huge chains wanting to swarm downtown Mill Valley. I do see a problem with tiny stores with inventories that are so small that they don’t offer a selection to local residents. We are ghetto-izing Mill Valley.”

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