City Council
Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Police
Meeting Date: January 12, 2026
Report #:2512-5609
TITLE
FIRST READING: Adoption of an ordinance to Amend Chapters 4.54 and 4.56 of the Palo Alto Municipal Code to Amend the Regulation of Massage Establishments and Hot Tub/Sauna Establishments as Recommended by the Policy & Services Committee; and Adoption of a Resolution to Amend the Administrative Penalty Schedule to Amend Related Penalties; CEQA status - not a project.
RECOMMENDATION
Staff recommends the City Council adopt an ordinance (Attachment A) amending the Palo Alto Municipal Code Chapter 4.54 on massage establishments and Chapter 4.56 on hot tub/sauna establishments, as unanimously recommended by the Policy and Services Committee on October 29, 2025 with minor updates from public feedback as detailed below in this staff report. Staff also recommend adoption of a resolution amending the Municipal Penalty Schedule (Attachment B) to conform existing penalties to new code numbering and delete penalties for sections no longer used.
EXECUTIVE SUMMARY
The proposed ordinance updates the Palo Alto Municipal Code to regulate massage and massage therapists in Palo Alto as well as hot tub/sauna businesses. For massage businesses and therapists, the codes provide clear standards to ensure massage therapy businesses are run safely and legally by setting basic rules for their buildings, cleanliness, and staff qualifications, while also deterring illegal activities like human trafficking, wage theft, and prostitution. This update allows only massage therapists certified by the state-sanctioned non-profit California Massage Therapy Council (CAMTC) to conduct massage in the city for the businesses. The new framework also offers City enforcement staff a broader mandate, increased options for enforcement, and clearer parameters for action. Updates to existing fees will be considered.
For Hot Tub/Sauna establishments, the proposed code directs the business operator to comply with County of Santa Clara requirements so the city can delete redundant codes.
BACKGROUND
Palo Alto’s regulation of massage and hot tub/sauna businesses has evolved over the years. For massage businesses, it began formally in the early 1970s when the city enacted PAMC 4.54 to regulate massage businesses, in response to concerns about health and public safety. Codes were removed in 1997 to allow home-based massage businesses1.
In 2008, the regulatory landscape for massage therapy in California underwent a pivotal transformation with the passage of Senate Bill 731 (SB 731). This legislation established the California Massage Therapy Council (CAMTC), a private, non-profit organization tasked with overseeing the voluntary statewide certification of massage professionals. By creating a unified framework for certification and granting CAMTC the authority to conduct background checks and regulate massage schools, SB 731 replaced the previous patchwork of inconsistent local regulations with uniform state standards, thereby elevating professional standards and enhancing public protection. Further regulatory updates by state legislature came in 2011 (AB 619), reverting some control over massage business licensing back to local jurisdictions. In response, the City adopted an ordinance updating the Municipal Code in 20122. This is the last time the PAMC was updated for massage.
Staff has identified 19 existing massage establishments that will need to obtain establishment permits under the new code. Every massage therapist working in Palo Alto is already CAMTC- certified or is working on obtaining certification. Staff has identified one Hot Tub/Sauna business.
ANALYSIS
This discussion will address massage businesses and then hot tub/saunas. Since the last time Palo Alto updated the PAMC related to massage businesses in 2012, several more state assembly bills have been passed. The proposed ordinance would align Palo Alto with current state law, the CAMTC standards, and updated regulatory practices, fostering a safe and healthy environment for the massage business community, service providers, and the customer.
Similar to the current code, the proposed code requires massage establishments and practitioners to meet certain minimum standards, including building, sanitation, and 1 City Council, June 10, 1997 Report #273-97
https://portal.laserfiche.com/Portal/DocView.aspx?id=60793&repo=r-704298fc&searchid=a23b43a1-b630-493e- 87c1-21a2f6be1f37)
2 City Council, July 23, 2012, Report #2988 https://portal.laserfiche.com/Portal/DocView.aspx?id=108080&repo=r- 704298fc&searchid=18851bab-7ab7-466f-b71b-48eff2c9bd20) Passed on September 9, 2012 https://www.paloalto.gov/files/assets/public/v/1/agendas-minutes- reports/agendasminutes/city-council-agendas-minutes/00-archive/2012/09-04-12-agenda.pdf) operational requirements. Massage establishments will continue to have a local permit to operate, with provisions for annual permit renewals, application procedures, and associated fees. Like current code, the proposed code requires permits to be displayed where they are easily visible and allows city officials to inspect establishments to ensure compliance. Both existing and proposed codes provide a process for denying, suspending, or revoking permits if applicants or permit holders are found to have violated certain rules or laws, and in both, there is an appeals process for those who have been denied a permit or had one revoked.
Additionally, both laws include exemptions for certain professionals, such as physicians, nurses, physical therapists, and people who are certified by the California Massage Therapy Council (CAMTC), meaning those individuals do not need to obtain additional local permits. Both the existing and proposed codes have detailed definitions to clarify the terms used throughout the law, and they require compliance with other relevant city and state codes, such as building and health regulations. Overall, the main similarities lie in their goals of ensuring only qualified people can operate or work in massage establishments, maintaining high health and safety standards, and providing clear procedures for permitting, enforcement, and appeals for both businesses and their practitioners.
Despite many similarities with the existing code, the proposed code introduces several major changes. One of the biggest differences is the strong reliance on California’s statewide certification system for individual professionals by the non-profit, non-governmental CAMTC.
Under the new code, only CAMTC-certified professionals can legally provide massage services for compensation, eliminating the City’s existing system of issuing separate permits to individual massage technicians and trainees who do not want to be state-certified. This will shift credentialing and background checks of individual therapists to the non-profit, whereas the existing code required the police chief to review the education, background, and criminal history for each applicant. Another difference is that the proposed code adds more clarity for massage operators about the permitting process. The proposed code details exactly what information is required for business permits and includes more requirements for transparency, such as proof of lease or property owner acknowledgment and documentation of compliance with wage and hour laws. The proposed code also expands operational requirements, like stricter rules on business hours, customer privacy, and hygiene, and prohibits certain items like beds. There are also more specific rules for facility layout, signage, and clothing requirements, and mandatory posting of human trafficking notices.
Additionally, the proposed code sets out more comprehensive grounds and procedures for permit suspension or revocation, including violations of labor laws and advertising regulations.
It also gives the City the power to impose a five-year moratorium on massage businesses at locations where a permit was revoked. Finally, the proposed code adds administrative penalties and citations as enforcement tools and more clearly separates mobile and home-based businesses from fixed establishments. These changes aim to raise standards for public safety and business integrity.
Staff would like to express appreciation to the Santa Clara County Human Trafficking Task Force, CAMTC staff, and City of Sunnyvale personnel for their valuable input and collaboration in developing these amendments to the massage ordinance. Their expertise and support were instrumental in shaping these changes.
For hot tub/sauna code sections, much of the code is deleted and the licensing requirement is changed from City issuance to a requirement it be licensed by the County of Santa Clara, which already licenses such businesses for compliance with County environmental health standards.
Since the Policy and Services review, the Department conducted two outreach sessions and follow-up discussions with the business community and updated the ordinance Policy and Services recommended advancing to City Council based on the feedback received. Those updates are reflected in the ordinance in Attachment A and include:
1.Hours of Operation
For massage establishments that have been in operation for 10 years or longer, the Department reinstated an exemption process to allow establishments to provide massage services past 10:00 p.m. However, even with an exemption, no massage shall conclude later than midnight. The hour restriction does not apply to the use of hot tubs and saunas at combined hot tub/massage establishments.
2.Posting of Price List
The originally proposed ordinance required all services and prices to be displayed in a public area. In recognition of a combination of massage and non-massage (hot tub) offerings and variable pricing (e.g., based on time, day, or holiday), the Department updated the proposed ordinance to require only that massage service prices be posted, with an allowance for price variability.
3. Main Entry Door
The Department has updated the proposed ordinance to permit one or more entry doors leading directly to the reception and waiting area, rather than limiting establishments to a single entry. This change is intended to prevent patron entry from inconspicuous or rear entrances while allowing flexibility in business layout.
4. Locking of Interior Doors
The updated language now allows practical exceptions to the prohibition on locking interior doors. Hot tub rooms, private offices, storage rooms, and equipment rooms are now exempt from this requirement.
5. Beds and Soft Mattresses
The revised ordinance permits soft mattresses in hot tub rooms, recognizing their role in patron safety and comfort.
6. Alcohol Service
Massage establishments are not allowed to serve or sell alcohol. For businesses that are also a hot tub/sauna establishment, the revised ordinance clarifies that the restriction does not apply to the non-massage areas of the establishment. Alcohol service is still subject to other laws, including California Alcohol Beverage Control as may be applicable.
7. Sandal/Flip Flop Requirement
The Department updated the requirement in the proposed ordinance to state that sandals or flip flops must be provided to patrons if they are offered use of shower facilities. This replaces the previous language, which prohibited patrons from using shower facilities unless wearing slip-resistant sandals or flip flops.
FISCAL/RESOURCE IMPACT
The work to create this proposal has been done by City staff with no-cost support by the previously mentioned organizations. The adoption of the proposed ordinance would not significantly impact existing workload of staff. Department revenue and expenses are not expected to change. Updated fees related to permitting will be updated in the FY 2027 budget cycle if they are required.
STAKEHOLDER ENGAGEMENT
As massage establishments and massage therapist applicants have contacted the Police Department’s code enforcement over the last year, staff has notified them that the City is exploring significant updates regarding regulation and permitting processes for massage establishments. As this process moves along, staff will engage individually with established businesses to inform them of the proposed changes.
The Department held an in-person information session on November 18, 2025, at the Downtown Library with establishment representatives. From that meeting and others, the Department updated the proposed ordinance to reflect valuable feedback. A second meeting was held with the establishments on December 11, 2025, to review those changes. What is presented with this report reflects those updates since Policy and Services reviewed the originally proposed ordinance.
ENVIRONMENTAL REVIEW
Council action on this item is exempt from review under the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Section 15061(b)(3), as it can be seen with certainty that the activity will not have a significant effect on the environment.
ATTACHMENTS
Attachment A: Ordinance Amending PAMC Chapters 4.54 and 4.56 Attachment B: Resolution Amending and Restating the Administrative Penalty Schedule to Amend Penalties for PAMC Chapters 4.54 and 4.56.
APPROVED BY:
Andrew Binder, Police Chief