Loading...
HomeMy WebLinkAbout09 - On-site Consumption Use in Facilities that Manufacture Alcoholic BeverageQ SEW Pp�T CITY OF �m z NEWPORT BEACH c�<,FORN'P City Council Staff Report May 8, 2018 Agenda Item No. 9 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: Seimone Jurjis, Community Development Director - 949-644-3232, sjurjis@newportbeachca.gov PREPARED BY: Chelsea Crager, Associate Planner, ccrager@newportbeachca.gov PHONE: 949-644-3227 TITLE: An Ordinance to Allow On-site Consumption Use in Facilities that Manufacture Alcoholic Beverages (PA2017-181) ABSTRACT: A Zoning Code amendment revising the City's regulations related to alcoholic beverage manufacturing. The amendment would establish regulations permitting on-site consumption (e.g. tasting rooms) in facilities that are allowed to manufacture alcoholic beverages in the Industrial Zoning District. RECOMMENDATION: a) Conduct a public hearing; b) Find this project exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15305 (Minor Alterations in Land Use Limitations), because it has no potential to have a significant effect on the environment; and c) Waive full reading, direct the City Clerk to read by title only, introduce Ordinance No. 2018-4, An Ordinance of the City Council of the City of Newport Beach, California, Adopting Zoning Code Amendment No. CA2017-004 to Amend Land Use Regulations Relating to Alcoholic Beverage Manufacturing and Accessory Tasting Rooms within the Industrial Zoning District (PA2017-181), and pass to second reading on May 22, 2018. FUNDING REQUIREMENTS: There is no fiscal impact related to this item. INTRODUCTION: Background The alcoholic beverage manufacturing industry, including tasting rooms, is a growing industry that provides new economic opportunity for small businesses. In the last decade, the craft breweries industry has expanded substantially within Orange County. 9-1 An Ordinance to Allow On-site Consumption Use in Facilities that Manufacture Alcoholic Beverages (PA2017-181) May 8, 2018 Page 2 Currently alcoholic beverage manufacturing is defined as a "food processing" land use under the Zoning Code and is a permitted use within the Industrial (IG) Zoning District. However, the Zoning Code does not allow on-site consumption of alcohol (e.g. tasting rooms) in conjunction with food processing. Based on research, staff believes that tasting rooms are an important component of the craft alcoholic beverage manufacturing business model and that an amendment to the zoning standards is warranted. Planning Commission Action Based on an applicant's interest, staff requested the Planning Commission initiate this code amendment to consider allowing craft breweries, wineries, and distilleries with on- site consumption in the IG Zoning District subject to discretionary review. The IG zone is generally located in the West Newport -Mesa industrial area abutting the City of Costa Mesa and is shown on Attachment B. Staff drafted an ordinance to allow alcoholic beverage manufacturing in the IG Zoning District subject to approval of a minor use permit, which would be reviewed at a public hearing with the Zoning Administrator. Due to parking concerns and desire to increase public comment opportunities, the Planning Commission modified the draft ordinance to require a conditional use permit (CUP) that would be reviewed at a public hearing with the Planning Commission, and to allow the review authority to require additional parking if warranted. At the conclusion of the public hearing, the Planning Commission voted 6-1 to recommend approval of the proposed amendment to City Council (Attachments C and D). DISCUSSION: The proposed Zoning Code Amendment is included as Attachment A (Draft Ordinance — Zoning Code Amendment CA2017-004). It provides development standards and operational limitations for new craft breweries, wineries and distilleries, including limitations to the size of the tasting room, hours of operation, provision of food service, and parking as summarized below. The Newport Beach Police Department has also incorporated security and training standards into the proposed ordinance amendment and is not opposed to allowing on-site consumption provided there are no late hours (after 11 p.m.) in the IG Zoning District. In addition, the draft ordinance requires discretionary review through a conditional use permit, which allows the City to evaluate a proposal on a case-by-case basis and to place appropriate conditions of approval on establishments based upon the unique circumstances of each proposal. Location and Permit Processin The draft ordinance conditionally allows alcoholic beverage manufacturing in the IG Zoning District subject to approval of a conditional use permit. Approval of a conditional use permit requires a public hearing with the Planning Commission and notification of all property owners within a 300 -foot radius. There are a total of 39 IG zoned properties located in the West Newport -Mesa industrial area near the City of Costa Mesa. 9-2 An Ordinance to Allow On-site Consumption Use in Facilities that Manufacture Alcoholic Beverages (PA2017-181) May 8, 2018 Page 3 Although the IG zoning district allows moderate and low -intensity industrial uses, more sensitive land uses that surround the zone include the Multi -Unit Residential (RM), Private Institutions (PI), and Public Facilities (PF) zoning districts. Therefore, a discretionary process allows the review authority to review each case for compatibility with surrounding land uses and apply conditions of approval as appropriate. ninfinitinn The draft ordinance includes a land use definition for "alcoholic beverage manufacturing." This would reclassify breweries, wineries and distilleries from a "food processing" land use to a land use with specific standards appropriate for alcoholic manufacturing, sales and service. Tasting Room Standards To maintain land use compatibility with the surrounding industrial and office uses, the draft ordinance regulates the accessory tasting rooms as follows: Size — The size of tasting rooms would be limited to 750 square feet. Outdoor Patios — Outdoor patios up to 1,000 square feet in size would be allowed. The patio location and design would be considered as a part of individual use permit application and reviewed for compatibility with surrounding land uses. Hours of Operation — Hours of operation of the tasting rooms would be limited to between the hours of 11 a.m. and 11 p.m., daily. No late hours (after 11 p.m.) would be permitted. The proposed ordinance does not include a limitation on hours of operation for the manufacturing aspect of the use. Food Service — The proposed ordinance does not require food service; however, food preparation and/or service would be allowed to be included as an accessory use of the tasting room. The establishment may prepare food onsite or allow food stands/trucks that do not interfere with required parking or circulation. Requiring food service is an option; however, some craft breweries do not provide food service and staff felt it could be an impediment to establishing the targeted uses. Parking The ordinance includes a parking requirement of one parking space per 500 square feet of gross floor area for the manufacturing use including the tasting room, or as required by conditional use permit. This ratio is the same requirement for small industrial uses and provides the review authority the ability to require additional parking if specific circumstances warrant. The tasting rooms associated with alcoholic beverage manufacturing typically have peak hours of operation that offset from the general manufacturing and office uses located in the vicinity, with highest demands on weekdays after 5 p.m. and weekends. As a result, staff does not anticipate any parking conflicts. 9-3 An Ordinance to Allow On-site Consumption Use in Facilities that Manufacture Alcoholic Beverages (PA2017-181) May 8, 2018 Page 4 The discretionary process will require a review of onsite parking to ensure the adequacy of parking based upon an individualized assessment. General Plan Consiste All properties within the IG Zoning District are also designated General Industrial (IG) within the Land Use Element of the General Plan. This designation is intended to provide for a wide range of moderate to low intensity industrial uses, such as light manufacturing and research and development, and limited ancillary commercial and office uses. The addition for on-site consumption with possible food service to alcoholic beverage manufacturing uses would be accessory to the manufacturing use. Therefore, staff believes the proposed amendment is consistent with the General Plan land use designation. The proposed conditional use permit procedure will ensure these activities will be compatible with surrounding industrial, commercial and residential uses. General Plan Land Use Goal LU 5.5 states that the Industrial Districts should provide for the manufacturing of goods and research, and development that are attractive, compatible with adjoining nonindustrial uses, and well maintained. Land Use Policy 5.5.1 (Site Planning and Building Design) further requires that new and renovated industrial properties and structures be designed to exhibit a high quality of design and maintenance, and Land Use Policy 5.5.2 (Property Maintenance) encourages the upgrade of visually unattractive or poorly maintained industrial properties. The proposed amendment is consistent with this goal and policies in that each new establishment will be reviewed through the use permit process and have appropriate conditions of approval applied to maintain compatibility with surrounding uses, including nearby residential uses. Land Use Policy 6.7.1 (Primary Uses) encourages the development of small-scale incubator industries. The proposed amendment is consistent with this policy in that it provides a new economic opportunity for a new and upcoming small industry. ENVIRONMENTAL REVIEW: Staff recommends the City Council find the proposed amendment categorically exempt under Section 15305, of the California Environmental Quality Act (CEQA) Guidelines — Class 5 (Minor Alterations in Land Use Limitations). All the 39 lots within the IG Zone are presently fully developed with commercial and industrial uses with parking lots served and urban infrastructure. The area location is also not environmentally sensitive. The lots are relatively flat with an average slope of less than twenty percent. The amendment does not change the land use or density, of the affected lots. The amendment does not directly authorize any uses or physical change to the environment. The amendment would allow small tasting rooms and outdoor patios subject to discretionary review (a CUP) as accessory uses to allowed alcohol manufacturing uses. Alcohol manufacturing is presently allowed in the IG zoning district. The amendment could provide an incentive for several additional alcohol manufacturing uses with tasting rooms. An Ordinance to Allow On-site Consumption Use in Facilities that Manufacture Alcoholic Beverages (PA2017-181) May 8, 2018 Page 5 It is impossible to predict the number of establishments that potentially could seek CUP's as it is dependent on site availability, location suitability, and market forces. One craft brewery was considering a site on Monrovia Avenue but has since decided to move in a different direction. Staff believes the number of potential establishments that might result from the amendment would be very limited based upon the number of properties, existing uses, and market forces. Future physical changes at a potential location would generally be limited to interior and exterior tenant improvements and shared use of parking lots. Increases in traffic and parking demand in the area could potentially result, but are considered minor given the limited number of properties affected by the amendment, size of tasting rooms, and limited number of future potential establishments. Finally, all discretionary uses are subject to environmental review; therefore, future alcohol manufacturing uses with tasting rooms will be subject to CEQA review. NOTICING: Notice of this amendment was published in the Daily Pilot as an eighth page advertisement, consistent with the provisions of the Municipal Code, and mailed to all owners of property within the IG Zoning District and owners of property within 300 feet of the boundaries of the IG Zoning District. Notice of the hearing was posted at 18 locations throughout the IG Zoning District. Additionally, the item appeared on the agenda for this meeting, which was posted at the Civic Center and on the City website. ATTACHMENTS: Attachment A — Draft Ordinance (Zoning Code Amendment No. CA2017-004) Attachment B — Map of IG Zoned Properties Attachment C — Planning Commission Resolution No. PC2018-013 Attachment D — March 22, 2018 Planning Commission Minutes 9-5 Attachment A Draft Ordinance (Zoning Code Amendment No. CA2017-004) wo ORDINANCE NO. 2018- 4 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH, CALIFORNIA, ADOPTING ZONING CODE AMENDMENT NO. CA2017-004 TO AMEND LAND USE REGULATIONS RELATING TO ALCOHOLIC BEVERAGE MANUFACTURING AND ACCESSORY TASTING ROOMS WITHIN THE INDUSTRIAL ZONING DISTRICT (PA2017-181) WHEREAS, pursuant to Newport Beach Municipal Code ("NBMC") Subsection 20.66.020(B), the City of Newport Beach ("City") Planning Commission initiated an amendment on October 5, 2017, to amend the land use regulations relating to alcoholic beverage manufacturing and accessory tasting rooms within the Industrial Zoning District; WHEREAS, the subject properties where alcoholic beverage manufacturing and accessory tasting rooms are proposed is designated Industrial ("IG") by the Land Use Element of the General Plan and are located within the Industrial ("IG") Zoning District; WHEREAS, the subject properties are not located within the Coastal Zone; WHEREAS, the alcoholic beverage manufacturing industry is a new and upcoming industry that provides new economic opportunity for small businesses; WHEREAS, the NBMC does not address alcohol consumption as an accessory use to an industrial use, and therefore provides no regulation or allowance for alcoholic beverage manufacturing with a tasting room; WHEREAS, alcoholic beverage manufacturing is an appropriate use in the Industrial Zoning District provided that it is adequately regulated; WHEREAS, the NBMC amendments set forth herein provide a review process and standards to ensure that alcoholic beverage manufacturing establishments and tasting rooms are operated with no detriment to the surrounding community and encourage the development of a small-scale incubator industry, consistent with General Plan Land Use Element Policy 6.7.1; WHEREAS, a public hearing was held on March 22, 2018, in the Council Chambers located at 100 Civic Center Drive, Newport Beach, California. A notice of time, place and purpose of the public hearing was given in accordance with the NBMC. Evidence, both written and oral, was presented to, and considered by, the Planning Commission at this public hearing; WHEREAS, on March 22, 2018, the Planning Commission adopted Resolution No. PC2018-010 by a majority vote of 6-1, recommending approval of Zoning Code Amendment No. CA2017-004 to the City Council; and 9-7 Ordinance No. 2018 - Page 2 of 6 WHEREAS, a public hearing was held on May 8, 2018, in the Council Chambers located at 100 Civic Center Drive, Newport Beach. A notice of time, place and purpose of the public hearing was given in accordance with the NBMC. Evidence, both written and oral, was presented to, and considered by, the City Council at this public hearing. NOW, THEREFORE, the City Council of the City of Newport Beach ordains as follows: Section 1: NBMC Subsection 20.70.020(A) (Definitions of Specialized Terms and Phrases) is amended to add a definition to read as follows: "Alcoholic beverage manufacturing" means establishments that produce or manufacture alcoholic beverages of all types. Businesses under this use class may have a tasting room and/or outdoor patio where they sell and serve alcohol produced or manufactured on the alcoholic beverage manufacturer's licensed premises for On -Sale or Off -Sale consumption. Section 2: Table 2-12 in NBMC Section 20.24.020 (Allowed Uses and Permit Requirements) is amended to add a row as follows: Alcoholic Beverage Manufacturing CUP Section 20.48.230 Section 3: Table 3-10 in NBMC Section 20.40.040 (Off -Street Parking Spaces Required) is amended, in part, to add the "Alcoholic Beverage Manufacturing" row as follows: Alcoholic Beverage ManufacturingI 1 per 500 sq. ft. or as required by conditional use permit Section 4: NBMC Section 20.48.230 (Alcoholic Beverage Manufacturing) is added to NBMC Chapter 20.48 (Standards for Specific Land Uses) to read as follows: 20.48.230 Alcoholic Beverage Manufacturing This section establishes standards for the establishment and operation of alcoholic beverage manufacturing and tasting rooms. A. Tasting Room. An accessory tasting room may not exceed a total of 750 square feet. A tasting room shall consist of the floor area where alcoholic beverages are consumed, including any bar and seating areas, but shall not include restrooms or employee service areas. B. Outdoor Patio. In addition to a tasting room, an outdoor patio may be permitted by the review authority and shall comply with the following standards: 1. Location. An outdoor patio shall be located on private property and not located in any required parking space or access way. 2. Area. An outdoor patio area may not exceed 1,000 square feet in area. .; Ordinance No. 2018 - Page 3 of 6 3. Barriers. Appropriate barriers shall be placed between outdoor patio areas and parking, pedestrian, and vehicular circulation areas. Barriers shall serve only to define the areas and shall not constitute a permanent all-weather enclosure. 4. Associated Elements. Physical elements (e.g., awnings, covers, furniture, umbrellas, etc.) that are visible from public rights-of-way shall be compatible with one another and with the overall character and design of the principal structure(s). C. Hours of Operation. Hours of operation of the tasting room and/or outdoor patio area shall be limited to between the hours of 11:00 a.m. to 11:00 p.m., daily. The review authority may further limit hours to ensure compatibility with surrounding uses. D. Grain Silo. A grain silo may be permitted to be located outside of the building serving as the alcoholic beverage manufacturing use. The grain silo may not be located in any required parking space or access way. E. Outdoor Storage. Outdoor storage, with the exception of a grain silo, shall be screened in accordance with the requirements in NBMC Section 20.48.140 (Outdoor Storage, Display, and Activities), or any successor section. F. Outdoor Equipment. Roof -mounted and ground -mounted mechanical equipment shall be screened in accordance with NBMC Section 20.30.020 (Buffering and Screening), or any successor section. G. Entertainment. 1. No video, electronic or other similar amusement devices or games shall be permitted. 2. The review authority may permit live entertainment and dancing. H. Security. Management shall maintain a security recording system with a thirty (30) calendar day retention and make those recordings available to police upon request. Management shall maintain an operational log of daily activities related to the sale and service of alcoholic beverages, as well as any additional security actions. Management shall make this log available to the police upon request. The review authority may require additional security measures. Occupancy. The number of persons shall not exceed the maximum occupancy load as determined by the Newport Beach Fire Department. Signs indicating the occupant load shall be posted in a conspicuous place on an approved sign near the main exit from the room. J. Food Service. Food preparation and/or service may be allowed as an accessory use to an alcoholic beverage manufacturer's licensed premises. Portable food stands, street kitchens or food trucks shall not obstruct required parking, fire lanes, or circulation. Ordinance No. 2018 - Page 4 of 6 K. Lighting. Parking lots, driveways, circulation areas, aisles, passageways, recesses and grounds contiguous to building making up an alcoholic beverage manufacturing use shall be provided with enough lighting to illuminate and make clearly visible the presence of any person on or about the alcoholic beverage manufacturer's licensed premises during the hours of darkness and shall provide a safe and secure environment for all persons, property, and vehicles onsite. L. Signage and Display. 1. Signs shall be posted inside the authorized alcohol service area near the exit stating, "No alcohol allowed past this point." 2. The display of alcoholic beverages shall not be located outside of a building or within five (5) feet of any public entrance to the building. M. Sales. 1. A licensed alcoholic beverage manufacturer may sell alcoholic beverages that are produced and bottled by, or produced and packaged for, that manufacturer for either on-site or off-site consumption. 2. A licensed alcoholic beverage manufacturer may sell equipment and ingredients intended for the purposes of brewing beer at home. N. Admission. There shall be no admission fee, cover charge, nor minimum purchase required for admission into the building or premises. O. Training. All owners, managers and employees selling alcoholic beverages shall undergo and successfully complete a certified training program in responsible methods and skills for selling alcoholic beverages within sixty (60) calendar days of date of hire. This training must be updated at a minimum every three (3) years regardless of certificate expiration date. The certified program must meet the standards of the California Coordinating Council on Responsible Beverage Service or other certifying/licensing body, which the State may designate. The establishment shall comply with the requirements of this section within sixty (60) calendar days of approval. Records of each owner's, manager's and employee's successful completion of the required certified training program shall be maintained on the premises and shall be presented upon request by a representative of the City of Newport Beach. Section 5: The recitals provided in this ordinance are true and correct and are incorporated into the substantive portion of this ordinance. Section 6: If any section, subsection, sentence, clause or phrase of this ordinance is for any reason held to be invalid or unconstitutional, such decision shall not affect the validity or constitutionality of the remaining portions of this ordinance. The City Council hereby declares that it would have passed this ordinance and each section, subsection, sentence, clause or 9-10 Ordinance No. 2018 - Page 5 of 6 phrase hereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses or phrases be declared invalid or unconstitutional. Section 7: This action is exempt from environmental review under the California Environmental Quality Act ("CEQA") pursuant to CEQA Guidelines Section 15305 — Class 5 (Minor Alterations in Land Use Limitations) because the lots affected by this amendment have an average slope of less than twenty percent; this amendment does not change the land use density, category or zoning district of the affected lots. Section 8: Except as expressly modified in this ordinance, all other Sections, Subsections, terms, clauses and phrases set forth in the NBMC shall remain unchanged and shall be in full force and effect. Section 9: The Mayor shall sign and the City Clerk shall attest to the passage of this ordinance. The City Clerk shall cause the ordinance, or a summary thereof, to be published pursuant to City Charter Section 414. This ordinance was introduced at a regular meeting of the City Council of the City of Newport Beach held on the 8th day of May, 2018, and adopted on the 22nd day of May, 2018, by the following vote, to -wit: AYES, COUNCILMEMBERS NOES, COUNCILMEMBERS ABSENT COUNCILMEMBERS MARSHALL "DUFFY" DUFFIELD MAYOR ATTEST: LEILANI I. BROWN CITY CLERK 9-11 Ordinance No. 2018 - Page 6 of 6 APPROVED AS TO FORM: CITY ATTORNEY'S OFFI AARON C. HARP cern o2s1I CITY ATTORNEY 9-12 Attachment B Map of IG Zoned Properties 9-13 a � PC 25 N a PC 25 NEW HALL ST Costa Mesa PF I a 167111 ST W Newport a 2r beach G4�A�s in GIS --e- Costa Mesa a ■ m IG (Industrial) iPF (Public Facilities) ■ PI (Private Institutions) ■ OM (Office Medical) - — - — — - — - ■ RM (Multi -Unit Residential) PRODUCTION PL IG.6.75.FAR IG 0.75 R FAH �w DI se la lm— Every reasonable elfort has been wde to assue Vte accuracy of the data �Q pmyided. however. The Cay M Newport Beach and Its employees and agents dselaim any and al responsibility from or rata€ing Iv any III obtalned in Its use. Ynegery: 20092013 photos protllded by Eagle Imaging waw.eaglesen al.mm a! PRODUCTION PL a � a IG 0.75 FAR IG a I FAIR FAR 73M.2120� QM 0:5 FAR �JQtiRM� 9-14 Attachment C Planning Commission Resolution No. PC2018-013 9-15 RESOLUTION NO. PC2018-013 A RESOLUTION OF THE PLANNING COMMISSION OF THE CITY OF NEWPORT BEACH, CALIFORNIA, RECOMMENDING CITY COUNCIL ADOPTION OF ZONING CODE AMENDMENT NO. CA2017-004 TO AMEND LAND USE REGULATIONS RELATING TO ALCOHOLIC BEVERAGE MANUFACTURING WITHIN THE INDUSTRIAL ZONING DISTRICT (PA2017-181) THE PLANNING COMMISSION OF THE CITY OF NEWPORT BEACH HEREBY FINDS AS FOLLOWS: SECTION 1. STATEMENT OF FACTS. 1. Pursuant to Newport Beach Municipal Code ("NBMC") Subsection 20.66.020(B), the Planning Commission initiated an NBMC amendment on October 5, 2017, to amend the land use regulations relating to alcoholic beverage manufacturing within the Industrial Zoning District. 2. The subject properties are designated Industrial ("IG") by the Land Use Element of the General Plan and are located within the Industrial ("IG") Zoning District. 3. The subject properties are not located within the Coastal Zone. 4. A public hearing was held on March 22, 2018, in the Council Chambers located at 100 Civic Center Drive, Newport Beach. A notice of time, place and purpose of the public hearing was given in accordance with the NBMC. Evidence, both written and oral, was presented to, and considered by, the Planning Commission at this public hearing. SECTION 2. CALIFORNIA ENVIRONMENTAL QUALITY ACT DETERMINATION. This code amendment is categorically exempt under Section 15305, of the California Environmental Quality Act ("CEQA") Guidelines — Class 5 (Minor Alterations in Land Use Limitations) because the lots affected by this amendment have an average slope of less than twenty percent, this amendment does not change the land use density, category or zoning district of the affected lots. SECTION 3. FINDINGS. 1. The alcoholic beverage manufacturing industry is a new and upcoming industry that provides new economic opportunity for small businesses. 2. The NBMC does not address alcohol consumption as an accessory use to an industrial use, and therefore provides no regulation or allowance for alcoholic beverage manufacturing with a tasting room. 3. Alcoholic beverage manufacturing is an appropriate use in the Industrial Zoning District provided that it is adequately regulated. 9-16 Planning Commission Resolution No. PC2018-013 Paae2of5 4. The attached code amendment provides a review process and standards to ensure that alcoholic beverage manufacturing establishments and tasting rooms are operated with no detriment to the surrounding community. SECTION 4. DECISION. NOW, THEREFORE, BE IT RESOLVED: The Planning Commission of the City of Newport Beach hereby recommends approval of Code Amendment No. CA2017-004 as set forth in Exhibit "A," which is attached hereto and incorporated herein by reference. PASSED, APPROVED, AND ADOPTED THIS 22ND DAY OF MARCH, 2018. AYES: Dunlap, Koetting, Kramer, Lowrey, Weigand and Zak NOES: Kleiman ABSTAIN: None ABSENT: None Peter oettingJ-S- ,Cha BY: A Erik Weigand, 01-03-17 9-17 Planning Commission Resolution No. PC2018-013 Paae 3 of 5 EXHIBIT "A" Zoning Code Amendment No. CA2017-004 Section 1: NBMC Subsection 20.70.020(A) (Definitions of Specialized Terms and Phrases) is amended to add a definition to read as follows: "Alcoholic beverage manufacturing" means establishments that produce or manufacture alcoholic beverages of all types. Businesses under this use class may have a tasting room and/or outdoor patio where they sell and serve alcohol produced or manufactured on the alcoholic beverage manufacturer's licensed premises for On -Sale or Off -Sale consumption. Section 2: Table 2-12 in NBMC Section 20.24.020 (Allowed Uses and Permit Requirements) is amended to add a row as follows.- Alcoholic ollows: Alcoholic Beverage Manufacturing CUP ISection 20.48.230 Section 3: Table 3-10 in NBMC Section 20.40.040 (Off -Street Parking Requirements) is amended, in part, to add the "Alcoholic Beverage Manufacturing" row as follows: Alcoholic Beverage Manufacturing 1 per 500 sq. ft. or as required by conditional use permit Section 4: NBMC Section 20.48.230 (Alcoholic Beverage Manufacturing) is added to NBMC Chapter 20.48 (Standards for Specific Land Uses) to read as follows: 20.48.230 Alcoholic Beverage Manufacturing This section establishes standards for the establishment and operation of alcoholic beverage manufacturing and tasting rooms. A. Tasting Room. An accessory tasting room may not exceed a total of 750 square feet. A tasting room shall consist of the floor area where alcoholic beverages are consumed, including any bar and seating areas, but shall not include restrooms or employee service areas. B. Outdoor Patio. In addition to a tasting room, an outdoor patio may be permitted by the review authority and shall comply with the following standards: 1. Location. An outdoor patio shall be located on private property and not located in any required parking space or access way. 2. Area. An outdoor patio area may not exceed 1,000 square feet in area. 01-03-17 • S Planning Commission Resolution No. PC2018-013 Paae 4 of 5 3. Barriers. Appropriate barriers shall be placed between outdoor patio areas and parking, pedestrian, and vehicular circulation areas. Barriers shall serve only to define the areas and shall not constitute a permanent all-weather enclosure. 4. Associated Elements. Physical elements (e.g., awnings, covers, furniture, umbrellas, etc.) that are visible from public rights-of-way shall be compatible with one another and with the overall character and design of the principal structure(s). C. Hours of Operation. Hours of operation of the tasting room and/or outdoor patio area shall be limited to between the hours of 11:00 a.m. to 11:00 p.m., daily. The review authority may further limit hours to ensure compatibility with surrounding uses. D. Grain Silo. A grain silo may be permitted to be located outside of the building serving as the alcoholic beverage manufacturing use. The grain silo may not be located in any required parking space or access way. E. Outdoor Storage. Outdoor storage, with the exception of a grain silo, shall be screened in accordance with the requirements in Section 20.48.140 (Outdoor Storage, Display, and Activities), or any successor section. F. Outdoor Equipment. Roof -mounted and ground -mounted mechanical equipment shall be screened in accordance with Section 20.30.020 (Buffering and Screening), or any successor section. G. Entertainment. 1. No video, electronic or other similar 'amusement devices or games shall be permitted. 2. The review authority may permit live entertainment and dancing. H. Security. Management shall maintain a security recording system with a thirty (30) calendar day retention and make those recordings available to police upon request. Management shall maintain an operational log of daily activities related to the sale and service of alcoholic beverages, as well as any additional security actions. Management shall make this log available to the police upon request. The review authority may require additional security measures. Occupancy. The number of persons shall not exceed the maximum occupancy load as determined by the Newport Beach Fire Department. Signs indicating the occupant load shall be posted in a conspicuous place on an approved sign near the main exit from the room. PTAINIM 9-19 Planning Commission Resolution No. PC2018-013 Paae 5 of 5 J. Food Service. Food preparation and/or service may be allowed as an accessory use to an alcoholic beverage manufacturer's licensed premises. Portable food stands, street kitchens or food trucks shall not obstruct required parking, fire lanes, or circulation. K. Lighting. Parking lots, driveways, circulation areas, aisles, passageways, recesses and grounds contiguous to building making up an alcoholic beverage manufacturing use shall be provided with enough lighting to illuminate and make clearly visible the presence of any person on or about the alcoholic beverage manufacturer's licensed premises during the hours of darkness and shall provide a safe and secure environment for all persons, property, and vehicles onsite. L. Signage and Display. Signs shall be posted inside the authorized alcohol service area near the exit stating, "No alcohol allowed past this point." 2. The display of alcoholic beverages shall not be located outside of a building or within five (5) feet of any public entrance to the building. M. Sales. A licensed alcoholic beverage manufacturer may sell alcoholic beverages that are produced and bottled by, or produced and packaged for, that manufacturer for either on-site or off-site consumption. 2. A licensed alcoholic beverage manufacturer may sell equipment and ingredients intended for the purposes of brewing beer at home. N. Admission. There shall be no admission fee, cover charge, nor minimum purchase required for admission into the building or premises. O. Training. All owners, managers and employees selling alcoholic beverages shall undergo and successfully complete a certified training program in responsible methods and skills for selling alcoholic beverages within sixty (60) calendar days of date of hire. This training must be updated at a minimum every three (3) years regardless of certificate expiration date. The certified program must meet the standards of the California Coordinating Council on Responsible Beverage Service or other certifying/licensing body, which the State may designate. The establishment shall comply with the requirements of this section within sixty (60) calendar days of approval. Records of each owner's, manager's and employee's successful completion of the required certified training program shall be maintained on the premises and shall be presented upon request by a representative of the City of Newport Beach. 01-03-17 9-20 Attachment D March 22, 2018 Planning Commission Minutes 9-21 NEWPORT BEACH PLANNING COMMISSION MINUTES 3/22/2018 Christian Fanticola, applicant, shared his personal and business history and the circumstances under which he opened the restaurant. He read property owner Mario Marovic's statement in support of the application. He shared photos of the site before and after improvements and pictures of interior and exterior improvements. T.J. Fuentes, applicant representative, commented that the restaurant has had a positive impact on the community by eliminating a dilapidated property and improving the existing building. The applicant is requesting a Type 41 license, which requires a bona fide food service. The applicant is willing to restrict operating hours and provide a security plan. Commissioner Kleiman asked how sales were and the current hours of operation, Mr. Fanticola stated that current operating hours are Sunday through Thursday 7 a.m. to midnight, Friday and Saturday 7 a.m. to 3 a.m. Food and alcohol sales have been strong. , Chair Koetting asked about the location of trash facilities. Mr. Fanticola indicated that they share a dumpster with Stag Bar, located at the rear of the building adjacent to the alley. Chair Koetting asked if Condition 13 should include a queuing plan. Principal Planner Ramirez stated the City did not have anything like that for the public right-of-way, and indicated that Planning and Public Works would have to determine type of materials and permanency but said they would wait to determine whether it is needed before anything was planned. Motion made by Vice Chair Zak and seconded by Secretary Weigand to find this project exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15301 under Class 1 of the CEQA guidelines; and to adopt Resolution No. PC2018-012 approving Conditional Use Permit No. UP2017-028 with an additional condition of approval as stated by staff. Principal Planner Ramirez reported the additional condition of approval is "the permittee shall implement an operational security plan designed to ensure that alcoholic beverage control regulations and building occupancy limits are being followed. The content and adequacy of the plan shall be subject to the review and approval of the Police Department. The Police Department shall be notified of any changes to the approved plan." AYES: Koetting, Zak, Weigand, Kleiman, Kramer, Lowrey NOES: None RECUSED: Dunlap ABSENT: None ITEM NO. 5 CRAFT BREWERY ORDINANCE (PA2017-181) Site Location: Citywide Summary: An amendment to the Zoning Code revising the City's regulations related to alcoholic beverage manufacturing. Specifically, the amendment would establish regulations permitting alcoholic beverage manufacturing with tasting rooms in the Industrial Zoning District. Recommended Action: 1. Conduct a public hearing; 2. Find this project exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15305 (Minor Alterations in Land Use Limitations), because it has no potential to have a significant effect on the environment; and 3. Adopt Resolution No. PC2018-010 recommending the City Council approve Zoning Code Amendment CA2017-004. Associate Planner Chelsea Crager reported the ordinance will apply to breweries, wineries, and distilleries.. Alcoholic beverage manufacturing is defined as a food processing land use, which is permitted within the industrial zoning district. There is no process in place that allows onsite consumption or tasting rooms in conjunction with food processing in the City of Newport Beach. On October 5, 2018, the Planning Commission initiated a code amendment to consider a process to allow alcoholic beverage manufacturing uses with accessory tasting rooms 4of9 9-22 NEWPORT BEACH PLANNING COMMISSION MINUTES 3/22/2018 in the industrial zoning district. The industrial zoning district applies to 39 properties. The draft ordinance will require each prospective tasting room business to apply for a minor use permit subject to review by the Zoning Administrator. This will allow each location to be reviewed individually and, if approved, to have appropriate conditions of approval. The draft ordinance creates a new land use definition, which is separate from food processing, and classifies all alcoholic beverage manufacturing. Standards include a maximum tasting room size of 750 square feet interior and a maximum outdoor patio size of 1,000 square feet. The draft ordinance limits hours of operation to 11 a.m. to 11 p.m. for the tasting room. The ordinance will place no size requirements or limitation on hours for the manufacturing aspect of the business. Live entertainment and food service may be permitted on a case-by-case basis. These standards are regulatory limits; therefore, each operational standard may be further limited through conditions of approval for each individual business. Parking is required at a rate of 1 space per 500 square feet of gross floor area, which includes manufacturing and public area. Two property owners on Production Place provided written comments regarding concerns about traffic, parking, noise, street cleaning, and pollution from a manufacturing use. All new businesses will be subject to a discretionary review process and will be required to comply with the California Building Code. The discretionary review process will allow specific conditions to be placed on each business. Chair Koetting asked why there was a limit of 750 square feet of interior space and why there were limitations on the outdoor patio. Associate Planner Crager stated that staff wanted to have limits in place because the tasting room is intended to be accessory to the manufacturing use. Commissioner Dunlap asked staff to explain how Orange Coast Winery came to be. Deputy Director Campbell stated that the establishment opened at a unique time, between adoption of the General Plan and adoption of the current Zoning Ordinance. There was an interim study overlay process that allowed the owner to rezone the property to establish and regulate land uses that were thought to be consistent with the future Zoning Code. Orange Coast Winery was established through that process with the findings that it would be consistent with the industrial zone. The Zoning Code Update adopted in 2010 did not provide for retail sales and/or consumption of alcohol at an establishment such as this. Orange Coast Winery is a grandfathered use. Commissioner Dunlap asked if a wine tasting operation came in today, could the Commission approve it or would we have to deny it because it is not a proper use for the area. Deputy Director Campbell stated that that use would be consistent with the ordinance. Wine tasting could be allowed if it met all the regulatory requirements in the proposed ordinance. Commissioner Dunlap mentioned that some properties back up to residences, specifically the strip on the south side of Production Way backs up to a mobile home park. Deputy Director Campbell responded that the south side is Seaside mobile home park and apartment complex. Commissioner Dunlap asked about the property south of Carden Hall. Deputy Director Campbell responded that the property backs up to a residential zone, but is developed with Coastline College. Coastline Community College District constructed an educational facility in a residential zone. Commissioner Dunlap, asked for the other Commissioners' thoughts on removing the properties along the southern side of Production Way from consideration due to the proximity to residential properties. Secretary Weigand asked for clarification regarding Commissioner Dunlap's concerns with the use. Commissioner Dunlap responded that he is not concerned with the manufacturing aspect because it does not produce fumes and is not noisy. His concerns were primarily with the outdoor tasting and dining that would take place until 11 p.m. next to residential neighborhood. Commissioner Kramer noted that the Commission cannot selectively pick and choose areas within a certain zoning area to apply the ordinance to. Assistant City Attorney Torres stated that this is correct, that could be considered spot zoning. He stated that the action must be applicable to entire zone and cannot exclude specific properties. Vice Chair Zak asked about the process to approve a use with an outdoor tasting area and whether it would include an acoustic analysis in relation to residents immediately adjacent. Associate Planner Crager responded that as the draft ordinance is currently written, a minor use permit would be required, which is reviewed by the Zoning Administrator. A minor use permit requires all the same findings as a conditional use permit and compatibility with surrounding uses, including nearby residential, would be addressed. As an example, it is possible that an applicant proposes an outdoor patio at the rear of the property near a residential use, and the review process may require the patio be relocated or closed at an earlier hour. These types of issues would be worked out on a property -by - property basis during the use permit process. 5 of 9 9-23 NEWPORT BEACH PLANNING COMMISSION MINUTES 3/22/2018 Commissioner Lowrey stated that if it was a conditional use permit it would come to Planning Commission. He stated that the use should require a conditional use permit rather than minor use permit. Commissioner Dunlap asked for confirmation that live entertainment is a privilege, and not permitted by right. Associate Planner Crager confirmed. Commissioner Dunlap asked that the Planning Commission hear proposals for live entertainment rather than the Zoning Administrator. Associate Planner Crager responded that, as written, the Zoning Administrator would handle all aspects of review under a minor use permit. If the Planning Commission changed the ordinance to require a conditional use permit, the Planning Commission would review. Chair Koetting stated that these types of places are typically located in commercial zones and asked why they were being restricted to the industrial zone. Associate Planner Crager stated that this specific use is not intended to be a restaurant. If food service is included it would be accessory to the manufacturing aspect. These types of businesses are primarily manufacturing and typically located in industrial zones. Commissioner Dunlap stated that many breweries are using vendor trucks to provide food or have container kitchens. Chair Koetting proposed an example of a national chain coming into Newport Beach and wanting to open a restaurant with a brewery inside and asked if that would be permitted in a commercial retail zone. Deputy Director Campbell stated that that use would be called a brew pub, and that they would be brewing for onsite consumption. It would be a restaurant with brewing as an accessory activity. It would be allowed in a commercial district subject to a conditional use permit if they have late hours. He also stated that nobody has asked for that recently. He stated that breweries are typically limited to the industrial zone because of the cost and compatibility with other uses. He stated that if the use works in the industrial zone, the City may consider other areas in the future. Chair Koetting opened the public hearing. Gordon Wanlass, the owner of a building in the south section of the industrial zone, spoke and questioned why the City is proposing the Ordinance. He expressed concern that the area was being used as guinea pigs for uses that may be allowed elsewhere. He also stated that there are three schools in the area and a parking problem on Production Place. He would like the Commission to put this amendment aside, as they do not know of the effect on property values or how alcohol sales will affect the area. He mentioned that a number of buildings on Production Place are family businesses and that he would like to work with the Planning Commission to see what is right for the very unique area. Jim Mosher stated he believed there was a Brown Act issue about this item. He stated that the description of this item on the agenda called the Ordinance a Craft Brewery Ordinance, and nothing would lead someone to believe the Ordinance would apply to any use other than breweries. He believes the item must be considered at a later date after proper notice. He stated that there is a discrepancy regarding products for sale being limited to alcohol produced or manufactured on the manufacturer's licensed premises and alcoholic beverages produced and bottled by or produced and packaged for the business. He expressed that a tasting room is not really a tasting room as there is no limit on how much you can taste. He asked about consistency with the General Plan. Becca Mantee, a business owner within the industrial zone, spoke and stated that she has hundreds of customers talk about having a place to hang out in the neighborhood. She stated that her customers have no problem with parking, and that they have a parking lot. She stated that the Ordinance would be a great addition to the neighborhood. Ian Elliott, owner of a business at 870 Production Place, spoke and stated that parking is a big issue and he would like to work with the City. He stated that a piecemeal approach is part of the problem. Kyle Connelly, a business owner and operator, spoke and stated that the Ordinance provided a great opportunity, as there are no notable craft breweries in the area. He stated that it could create a place for employees in the area to meet and share ideas. Richard Allred, of Toes on the Nose off of Monrovia, spoke and stated that parking is not an issue. He stated that many people walk and ride bikes, that the area was live/work, and that the Ordinance could provide a great 6 of 9 9-24 NEWPORT BEACH PLANNING COMMISSION MINUTES 3/22/2018 opportunity to socialize after work. He stated that residential uses were coming into this part of town and that the Ordinance provides a viable opportunity for the area to grow and mature. Chair Koetting closed the public hearing. Deputy Director Campbell responded to the concerns regarding the Brown Act. The title "Craft Brewery Ordinance" is just a name, and the public notice refers to alcoholic beverage manufacturing which includes distilleries and wine making operations. The item was properly noticed. The language of the notice addresses the entire scope of the amendment. Assistant City Attorney Torres stated that the item was properly noticed. He stated that staff routinely incorporates a title for ease of reference. Commissioner Dunlap addressed the discrepancy regarding sales. He stated that breweries typically bring in people to bottle and can the brewery's product. Associate Planner Crager stated that staff intended to allow for some amount of tap takeovers where beverages from one brewery are served in another brewery to promote the industry. Secretary Weigand asked about the parking situation and adding flexibility in the requirement to increase protections for existing businesses in the area. Associate Planner Crager responded that the draft ordinance requires one space per 500 square feet of gross floor area, which includes all manufacturing area and net public area. Staff believes that this is sufficient to address parking requirements for this type of business, considering there are limitations on the size of tasting rooms and outdoor patios and that these areas could be further limited during the discretionary process. If the Commission wishes to require different amounts of parking, restaurant parking is based on net public area. Because this use is primarily manufacturing, staff did not consider this approach. Other types of uses in the Zoning Code may state a parking requirement with an addition of "or as required by use permit." That provides some flexibility for the review authority to implement parking requirements. This is not typical. Vice Chair Zak asked if parking spaces are required to be onsite. Associate Planner Crager confirmed that they are. Commissioner Kleiman asked about the parking requirement for a restaurant or bar. Associate Planner Crager responded that restaurant parking requirements are based on net public area, with a range of 1 parking space per 30 square feet to 1 parking space per 50 square feet, and are typically parked at 1 parking space per 40 square feet of net public area. Commissioner Kleiman asked about the parking requirement for 1,750 square feet public area plus the requirement for employees and the manufacturing portion. Associate Planner Crager responded that a restaurant with 1,750 square feet of net public area would typically require 44 parking spaces. Commissioner Lowrey stated that a conditional use permit provides more transparency and opportunity for public comment than a minor use permit. Secretary Weigand confirmed that the City Council makes the final decision to adopt an ordinance. Vice Chair Zak asked if staff received any comments or questions from Carden Hall or other schools in the area. Associate Planner Crager responded that none were received. Motion made by Commissioner Lowrey and seconded by Commissioner Dunlap to amend the proposed ordinance to require a conditional use permit rather than a minor use permit and a revision to add "or as required by the reviewing authority" to the parking requirement. AYES: Koetting, Zak, Weigand, Dunlap, Kramer, Lowrey NOES: Kleiman ABSTAIN: None ABSENT: None 7 of 9 9-25 NEWPORT BEACH PLANNING COMMISSION MINUTES X. 3/22/2018 Motion made by Commissioner Kramer and seconded by Secretary Weigand to find this project exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15305; and to adopt Resolution No. PC2018- 010 recommending the City Council approve Zoning Code Amendment CA2017-004 as amended. AYES: Koetting, Zak, Weigand, Dunlap, Kramer, Lowrey NOES: Kleiman ABSTAIN: None ABSENT: None STAFF AND COMMISSIONER ITEMS ITEM NO.6 MOTION FOR RECONSIDERATION None ITEM NO. 7 COMMUNITY DEVELOPMENT DIRECTOR'S REPORT Update on City Council Items Director Jurjis reported staff will present the annual status report for the General Plan and Housing Element during the next City Council meeting. He requested Commissioners' preference for holding or cancelling the July 5, 2018 Planning Commission meeting. Commissioners generally agreed to cancel the July 5, 2018, Planning Commission meeting. Vice Chair Zak recused himself from discussion of the Koll Residences project due to a business interest in the area. Commissioner Kleiman recused herself due to a business conflict. As Commissioner Lowrey had already left the meeting, Assistant City Attorney Torres advised that Commissioner Lowrey was recused due to membership in the Pacific Club. Director Jurjis advised that staff is considering May 29, May 30, and May 31, 2018, for a study session on the Koll Residences project. In response to Chair Koetting's questions, Director Jurjis indicated the applicant is not available on May 24, a date originally considered. Staff would prefer to hold the regular meeting on May 17 and schedule a separate date for the Koll project. Coralee Newman advised that the applicant's planning team would prefer May 31. She could not be present on May 24. Commissioners discussed their availability for dates in April, May, and June and determined a special meeting could be scheduled for May 31, 2018, at 4 p.m. to discuss the Koll Residences project. In answer to Chair Koetting's query, Director Jurjis reported staff expects the Lido House to hold a soft opening in the next few weeks. He was not aware of a date for a ribbon -cutting ceremony. Commissioner Kramer added that the opening will likely be in late April. ITEM NO. 8 ANNOUNCEMENTS ON MATTERS THAT THE PLANNING COMMISSION MEMBERS WOULD LIKE PLACED ON A FUTURE AGENDA FOR DISCUSSION, ACTION, OR REPORT None ITEM NO. 9 REQUESTS FOR EXCUSED ABSENCES Absences were requested for Commissioner Kramer on April 19tH, Commissioner Weigand on May 3rd, and Commissioner Dunlap on May 17tH 8 of 9 9-26