TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: OFFICE OF THE CITY MANAGER
BY: IRMA HUITRON, DIRECTOR OF COMMUNITY DEVELOPMENT
DATE: JUNE 24, 2025
SUBJECT: TEN-DAY REPORT ON INTERIM URGENCY ORDINANCE NO. 25-1528 WHICH ESTABLISHED A 45-DAY MORATORIUM ON SINGLE PRICE
OVERSTOCK/DISCOUNT STORES ("SPODS") WITHIN CITY LIMITS
EXECUTIVE SUMMARY
The City Council will receive and file this 10-day report on Interim Urgency Ordinance No. 25-1528, adopted on May 28, 2025, which established a 45-day moratorium on the approval, commencement, establishment, relocation, or expansion of Single Price Overstock/Discount Stores (SPODS) within City limits. Pursuant to Government Code Section 65858(d), at least 10 days prior to the expiration of the 45-day moratorium, the City is to issue a written report describing the measures taken to alleviate the conditions which led to the adoption of the moratorium.
That the City Council:
Receive and file the informational 10-day report required under Government Code Section 65858(d), describing the measures taken to alleviate the conditions which led to the adoption of the moratorium.
BACKGROUND
On May 28, 2025, pursuant to Government Section 65858, in an effort to protect the public health, safety, and welfare, the City Council adopted Interim Urgency Ordinance No. 25- 1528 establishing a 45-day moratorium on the approval, commencement, establishment, relocation, or expansion of Single Price Overstock/Discount Stores ("SPODS") within the City limits.
In the adopted moratorium, a "single price overstock/discount store" (SPODS) is generally defined as a retail store that sells individual items generally obtained through outlet, close- out, discontinued, liquidation, or overstock, primarily at a single discount price or in the low- and very low- price ranges (e.g., $10.00, or less). A SPODS generally dedicates less than fifteen percent (15%) of shelf space to fresh or frozen foods and produce and sells an assortment of physical goods, products, or merchandise directly to the consumer,
10-DAY REPORT ON INTERIM URGENCY ORDINANCE NO. 25-1528
JUNE 24, 2025
PAGE 2
including food or beverage for off -premises consumption, personal grooming and health products, household goods, and other consumer products.
SPODS typically have lower quality items, items that cost much more per ounce over time, and limited access to fresh foods. Furthermore, SPODS contribute to local resident fear of safety by being a source of trash, loitering, graffiti, and theft in and around them due to their lack of security. The Downey Municipal Code does not specifically identify SPODS as permitted by right or as a conditional use, so there are currently no specific regulations to curb threats to the public health, safety, or welfare posed by SPODS.
SPODS may have a profound impact on the public health, safety, general welfare, and quality of life of surrounding communities. They often negatively impact an area's economic vibrancy because such uses offer minimal or no improvements to the existing structures they occupy, and they attract other bargain retailer uses and discourage higher quality retail and commercial uses from locating nearby.
There is concern that the proliferation of SPODS without further regulation could have adverse impacts on the City and would constitute a current and immediate threat to the public health, safety, and welfare in that such a development will start an irrevocable downward shift in the economic and aesthetic value of commercial areas and thus impair the economic development and other goals of the City. Currently, there are approximately 26 discount type retail stores in the City, and approximately eight (8) of those locations' operations appear to align with the definition of SPODS.
The interim moratorium will expire on July 12, 2025, unless extended by the City Council.
In accordance with Government Code Section 65858(d), at least 10 days prior to the expiration of the 45-day moratorium, the City is to issue a written report describing the measures taken to alleviate the conditions which led to the adoption of the moratorium.
ANALYSIS
Staff is continuing to study the issues associated with SPODS to determine how they should be defined, how they should be permitted, and which locations are most appropriate to mitigate any potential adverse impacts on the City. Additionally, staff will review development standards and best practices from other jurisdictions to determine if they would be appropriate in Downey.
Staff has taken the following measures to alleviate the conditions that led to the adoption of the Interim Urgency Ordinance.
1. Staff has assembled a team with land use and zoning expertise to analyze existing conditions and develop appropriate regulations for the potential regulation of SPODS in various zoning districts throughout the City.
10-DAY REPORT ON INTERIM URGENCY ORDINANCE NO. 25-1528
JUNE 24, 2025
PAGE 3
2. The topics that will be studied by the City team are being identified and include, but are not limited to, zoning code amendments that will define SPODS as a sub - retail land use category, land use definitions, development, and operational standards.
3. The team has commenced the process of reviewing Title 9 (Land Use) of the Downey Municipal Code to identify sections that will need to be amended to address concerns from Ordinance No. 25-1528.
4. The team has also begun reviewing other City plans or documents that may need to be amended or referenced to implement the contemplated zoning code amendments.
5. This team will produce a report to the Planning Commission summarizing the results of their evaluation and presenting recommendations for the Commission's consideration.
Staff recommends that the City Council receive and file this 10-day report. This staff report shall constitute the City Council's 10-day report as required under Government Code Section 65858(d), describing the measures taken to alleviate the conditions which led to the adoption of the moratorium. At the July 8, 2025 City Council meeting, a public hearing be held to consider an extension of Urgency Ordinance No. 25-1528 for an additional 10- months and 15 days, commencing July 12, 2025, to allow staff to further study the issues in accordance with Government Code Section 65858.
CITY COUNCIL PRIORITIES
Economic Vibrancy
Quality of Life, Safety, & Infrastructure
FISCAL IMPACT
There are no fiscal impacts identified with this action.
ATTACHMENTS
Attachment A: Interim Urgency Ordinance No. 25-1528
ORDINANCE NO. 25-1528
AN INTERIM URGENCY ORDINANCE OF THE CITY COUNCIL OF THE
CITY OF DOWNEY PURSUANT TO GOVERNMENT CODE SECTION
65858 ESTABLISHING A 45-DAY MORATORIUM ON THE APPROVAL,
COMMENCEMENT, ESTABLISHMENT, RELOCATION, OR EXPANSION
OF SINGLE PRICE OVERSTOCK/DISCOUNT STORES WITHIN CITY
LIMITS
WHEREAS, the City of Downey has the police power pursuant to Section 7 of Article XI of the California Constitution to make and enforce ordinances to regulate the use of land within its jurisdictional borders; and
WHEREAS, Government Code Section 65858 expressly authorizes the City Council, in order to protect the public safety, health, and welfare, to adopt an interim urgency ordinance prohibiting uses that may be in conflict with a contemplated general plan, specific plan, or zoning proposal that the legislative body, planning commission, or the planning department is considering or studying or intends to study within a reasonable time, provided that the urgency measure shall require a four -fifths vote of the legislative body for adoption, and shall be of no further force and effect forty-five (45) days from its date of adoption, unless duly extended in accordance with applicable law; and WHEREAS, this type of interim urgency ordinance may be adopted without following the notice and hearing procedures otherwise required prior to the adoption of a zoning ordinance; and
WHEREAS, a single price overstock/discount store (or stores as appropriate) ("SPODS") is generally defined as a retail store that sells individual items generally obtained through outlet, close-out, discontinued, liquidation, or overstock, primarily at a single discount price or in the low and very low price ranges (e.g., $10.00 or less); and WHEREAS, SPODS generally dedicate less than fifteen percent (15%) of shelf space to fresh or frozen foods and produce and sell at retail an assortment of physical goods, products, or merchandise directly to consumers, including food or beverage for off -premises consumption, personal grooming and health products, household goods, and other consumer products; and
WHEREAS, the Downey Municipal Code does not specifically identify SPODS as permitted by right or as a conditional use, so there are currently no specific regulations to curb threats to the public health, safety, or welfare posed by SPODS; and WHEREAS, there is a concern that the proliferation of SPODS, without further regulation, may have adverse impacts on the City. SPODS can have profound effect on the health and quality of life of the surrounding neighborhoods: they typically offer for sale lower quality items that cost more per ounce over time; they contribute to local residents' fear of safety by being a source of trash, loitering, graffiti, and theft in their vicinities due to lack of security; and they discourage residents from engaging in their communities; and WHEREAS, SPODS inhibit the upgrading of commercial areas in the City; and Attachment A
ORDINANCE NO.25-1528
PAGE 2
WHEREAS, there are currently eight (8) SPODS in the City, and the City's lack of regulations governing SPODS could result in an oversaturation of such uses in the City, and
WHEREAS, absent clear regulation, the proliferation of SPODS in the City poses a current and immediate threat to the public health, safety, and welfare because such development will prompt an irrevocable downward shift in the economic and aesthetic value of commercial areas and thus impair the economic development and other goals of the City; and
WHEREAS, the approval, commencement, establishment, relocation, or expansion of additional SPODS would result in this threat to public health, safety, and welfare; and
WHEREAS, the City intends to study the issues associated with SPODS to determine how they should be defined, how they should be permitted, which locations are most appropriate to mitigate any potential adverse impacts on the City, and review development standards and best practices from other jurisdictions to determine if they would be appropriate in Downey; and
WHEREAS, after undertaking this study, the City intends to enact regulations specific to SPODS, but in the interim, the City Council finds it necessary to establish a moratorium on the development of new SPODS or the expansion of existing SPODS under the circumstances above in order to prevent a conflict with the contemplated new policies or regulations.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF DOWNEY
DOES HEREBY ORDAIN AS FOLLOWS:
SECTION 1. The City Council finds that all of the foregoing recitals are true and correct and are hereby incorporated and adopted as findings of the City Council as if fully set forth herein.
SECTION 2. The City Council finds and determines that this Ordinance is not subject to the California Environmental Quality Act pursuant to Section 15061(b)(3) of the CEQA Guidelines because it will not have a significant effect on the environment, as the Ordinance will temporarily preclude the approval, commencement, establishment, relocation, or expansion of certain land uses City-wide.
SECTION 3. California Government Code Section 65858 expressly authorizes the City Council, in order to protect the public safety, health, and welfare, to adopt an interim urgency ordinance prohibiting uses that may be in conflict with a contemplated general plan, specific plan, or zoning proposal that the legislative body, planning commission, or the planning department is considering or studying or intends to study within a reasonable time, provided that the urgency measure shall require a four -fifths vote of the legislative body for adoption.
Attachment A
ORDINANCE NO. 25-1528
PAGE 3
SECTION 4. The City Council, in accordance with Government Code Section 65858, hereby adopts this interim urgency ordinance establishing a 45-day moratorium on the approval, commencement, establishment, modification, relocation, or expansion of Single Price Overstock/Discount Stores (SPODS) City-wide while City staff researches appropriate regulations. During this period, no permit shall be issued for the development of any SPODS within the City. The foregoing shall explicitly prohibit the issuance of any zoning, land use, discretionary permit, building permit, environmental approval, business license, or any other entitlement involving businesses defined as SPODS.
SECTIONS. This Ordinance shall take effect immediately and have no further force and effect forty-five (45) days from the date of its adoption; unless, however, after public hearing, the City Council, by four -fifths (415) vote, extends this Ordinance for an initial period of ten months and fifteen days and subsequently, after public hearing, the City Council, by four -fifths (415) vote, extends this Ordinance for one year.
SECTION 6. If any section, subsection, paragraph, sentence, clause or phrase of this Ordinance or any part thereof is declared by a court of competent jurisdiction to be unconstitutional or otherwise invalid, such decision shall not affect the validity of the remaining portions of this Ordinance or any part thereof. The City Council declares that it would have adopted this Ordinance, and each section, subsection, sentence, clause, phrase or portion thereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses, phrases, or portions be declared invalid or unconstitutional.
SECTION 7. This Ordinance is introduced, passed, and adopted at one and the same meeting and is thereafter immediately effective. Based upon the findings adopted in Section 1 of this Ordinance, there is a current and immediate threat to the public health, safety, and welfare, and this Ordinance is therefore necessary to protect the public health, safety, and welfare.
SECTION 8. The City Clerk shall certify to the adoption of this Ordinance and cause the same to be published in the manner prescribed by law.
APPROVED AND ADOPTED this 28t" day of May, 2025.
HECTOR SOSA, Mayor
ATTEST;
ARIA ALICIA, ..
City Clerk
Attachment A
ORDINANCE NO. 25-1528
PAGE 4
APPROVED AS TO FORM:
lycnu�
JOfiN M. FUNK
City Attorney
STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES) ss:
CITY OF DOWNEY }
HEREBY CERTIFY that the foregoing Interim Urgency Ordinance No. 25-1528, was adopted at a Special meeting of the City Council of the City of Downey held on the 28Eh day of May, 2025, and by the following vote, to wit:
AYES:
Council Members:
NOES:
Council Members:
ABSENT:
Council Members:
ABSTAIN:
Council Members:
Frometa, Ortiz, Pemberton, Sosa
None.
Trujillo
None.
FURTHER CERTIFY that the full Interim Urgency Ordinance No. 25-1528, was published in the Downey Patriot, a newspaper of general circulation in the City of Downey, on May 29, 2025 (after adoption, including the vote thereon). It was also posted in the regular posting places in the City of Downey on the same dates. 4W&LICIA DUAR , MC�
City Clerk
Attachment A