City of Sacramento
Law and Legislation Committee Report
915 I Street Sacramento, CA 95814
www.cityofsacramento.org
File ID: 2025-00769 4/8/2025 Item 6.
Discussion on Proposed Entertainment Zones
File ID: 2025-00769
Location: Citywide
Recommendation: 1) Review, comment and provide direction to the Interim City Manager on preparing an ordinance amending the Sacramento City Code to add Chapter 12.50 related to Entertainment Zones; and 2) Pass a Motion forwarding the ordinance to council without full Law and Legislation Committee review.
Contact: Tina Lee-Vogt, Nighttime Economy Manager, (916) 808-2679, [email protected], City Manager’s Office of Innovation and Economic Development; Dustin Hollingsworth, Assistant Director, (916) 808-5538, [email protected], Convention & Cultural Services
Presenter: Tina Lee-Vogt, Nighttime Economy Manager, (916) 808-2679, [email protected], City Manager’s Office of Innovation and Economic Development; Dustin Hollingsworth, Assistant Director, (916) 808-5538, [email protected], Convention & Cultural Services
Attachments:
1-Description/Analysis
2-Attachment A: ABC Entertainment Zone Participation Requirements and Guidelines Description/Analysis
Issue Detail: Sacramento has a rich and vibrant nighttime, social and creative economies, and offers world-class amenities for everyone. Residents and visitors can experience diverse entertainment and unique programming both day and night that appeal to all ages, backgrounds, and interests.
Throughout Sacramento, there are opportunities where people can go to play and socialize.
Special events play a pivotal role in the city's economy, culture, and identity, supporting jobs and generating revenue. They provide spaces for connection and creativity that bring people together to foster a sense of belonging and shared experiences. Annually, hundreds of special events including street markets, concerts and festivals are presented throughout our city.
File ID: 2025-00769 4/8/2025 Item 6.
Unfortunately, there have been barriers that prohibit local bars and restaurants from fully participating in and economically benefiting from special events held adjacent to their businesses. State alcohol licensing regulations have prohibited them from selling takeout alcoholic beverages for consumption at these outdoor events and activations. As a result, these businesses often complain that special events can negatively impact them. Although there are more people outside their doors, special event attendees are purchasing from vendors and not surrounding businesses. This has hurt businesses and their ability to grow and recover financially as they remain impacted by the COVID pandemic.
In 2023, Governor Newsom signed Senate Bill 76. This bill defined “entertainment zones” as zones that may be created by local ordinance and authorized consumption of alcoholic beverages on public streets, sidewalks, or public rights-of-way adjacent to and during special events. The law also made entertainment zones subject to certain requirements including a requirement to provide specified information about each entertainment zone to the Department of Alcoholic Beverage Control (ABC).
However, this law was limited to the City and County of San Francisco. In 2024, the Governor signed Senate Bill 969, which defined an “entertainment zone” as a zone created by a city, county, or city and county ordinance and expanded the ability to authorize entertainment zones to jurisdictions throughout the state. Attachment A lists the ABC requirements and guidelines for entertainment zone participation. This includes identifying the types of licenses allowed to participate in entertainment zones and requiring licensees to annually notify the department of their intent to participate in entertainment zones.
Entertainment zones are areas where people can buy open container beverages (alcoholic drinks to- go) from licensed bars, restaurants, breweries, and wineries and enjoy them outdoors in common spaces like plazas, sidewalks, and streets during certain hours. The intent is to create engaging and impactful destinations that encourage local economic growth, while enhancing the experience for residents and visitors. These zones provide several benefits. They can activate commercial corridors to attract people to an area and increase economic activity and enhance a city’s reputation as a vibrant cultural hub. Additionally, they can boost revenue for local businesses, including restaurants and bars, through events and activations that extend visitor stays.
Since San Francisco was the first jurisdiction allowed to authorize entertainment zones, others are utilizing them as the model. San Francisco uses a two-tier approach to implement their entertainment zones. First, the San Francisco Board of Supervisors designates the maximum geographic boundaries and hours of operation of entertainment zones that are subject to any additional conditions or permitting requirements. Then, administrative staff approve management plans to further regulate the operation of the zone within Board approved limits. This process offers flexibility to adjust conditions and provides zone operators with time to identify the most effective strategies, while the administrative oversight allows staff to include conditions to address specific community concerns.
File ID: 2025-00769 4/8/2025 Item 6.
Entertainment zone management plans are critical to the program and have several key components:
· Designate an “Entertainment Zone Lead” who acts as the point of contact and maintains the website and event calendar
· Designate applicable area and hours of operations
· Require compliance with any additional permits to activate the zone including any insurance requirements.
· Require marking geographic boundaries of the entertainment zone via signs, sidewalks decals or other approved methods
· Require submission of a security plan for police approval · Require age verification process to ensure anyone consuming alcohol is 21 years of age or older
· Require reporting any calls for service or violent incidents within 24 hours · Limit operators to only sell to go beverages in specific containers Last year, San Francisco held its first entertainment zone event on Front Street. It was very successful with about 10,000 attendees. All the participating bars reported that it was their largest event ever, with five to fifteen times more average sales. The media coverage of the event was very positive. San Francisco has added several new entertainment zones, including the Arena Entertainment Zone (Chase Center), Harlan Place and Mark Lane. They have many more that have been established in legislation but have not yet been implemented.
In December 2024, the San Francisco Office of Economic and Workforce Development and the Entertainment Commission hosted a webinar where they shared information on their entertainment zone program with other cities and counties. This informative session included lessons learned as they implemented zones, a few lessons they shared are:
· Allowing refinement through an administrative process made zones more adaptable. · Zones are most successful when community partners are sufficiently resourced to implement them.
· Zones should align with other permitting requirements.
Staff from the City Manager’s Office of Nighttime Economy (ONE) and the Convention and Cultural Services Department Entertainment Services Division (ESD) are collaborating to establish entertainment zones in Sacramento based on the San Francisco program. ONE and ESD are working with the City Attorney’s Office to draft an ordinance that creates entertainment zones as authorized by SB 969. The intent is to have the ordinance drafted for City Council consideration by May 2025.
File ID: 2025-00769 4/8/2025 Item 6.
Policy Considerations: Entertainment zones support the City’s commitment to the nighttime economy. They are also consistent with the findings and recommendations included in the Sacramento Sociable City Assessment to identify priorities to develop and implement a strategic plan for a safe, vibrant, and well managed social economy. And they also align with the findings and recommendations included in the Music Census and Regulatory Review, emphasizing a proactive approach to the growing entertainment scene.
Economic Impacts: Special events are a vital part of our economy, culture, and identity. They support jobs and generate revenue. Cities that thrive have a vibrant social economy. Participation in activations by bars and restaurants could provide significant benefits to businesses including increasing the length of stay per guest and dollars spent per guest.
Environmental Considerations: This report does not involve activities that constitute a “project” as defined by Sections 15061(b)(3) of the CEQA Guidelines because it does not have the potential for causing a significant effect on the environment. Additionally, the creation of entertainment zones is exempt from CEQA review pursuant to Section 15301, subsection (c) of the CEQA guidelines, as it involves only the minor, temporary alteration of existing streets and sidewalks.
Sustainability: Not applicable.
Commission/Committee Action: None.
Rationale for Recommendation: Staff are requesting direction on whether to proceed with a proposed new chapter to the Sacramento City Code to create entertainment zones. Further, staff are requesting approval to forward the proposed ordinance to the City Council for review and adoption without full Law and Legislation Committee review.
Financial Considerations: Creating entertainment zones will result in additional workload for city staff. However, this staff report does not include a funding request.
Local Business Enterprise (LBE): Not applicable.
Entertainment Zone Participation Requirements and Guidelines Detailed requirements and guidelines for participating in an established entertainment zone.
Requirements
Effective January 1, 2025, amendments to existing law allow for a city, county, or city and county to enact an ordinance that creates entertainment zones within their local jurisdiction. An established entertainment zone authorizes consumption of one or more types of alcoholic beverages on public streets, sidewalks, or public rights-of-way located with the defined boundaries of the entertainment zone. Licensees who would like to participate in an established entertainment zone must meet the following requirements:
1. Must be either a licensed beer manufacturer (e.g., Type 01, 23, 75), a licensed winegrower (e.g., Type 02), or an on-sale licensee (e.g., Type 41, 42, 47, 48). The example license types provided are not inclusive of all license types that may be able to participate. You should contact your local ABC office if you have questions about your ability to participate in an established entertainment zone.
2. The licensed premises that will be participating must be located within the defined boundaries of the established entertainment zone. You should contact the local jurisdiction responsible for creating the entertainment zone if you have questions about the defined boundaries.
3. Licensees who would like to participate in an established entertainment zone must notify the department of their intent to do so on an annual basis. This can be done on-line via the department’s Entertainment Zone Notification Tool.
Guidelines
1. Only those alcoholic beverages allowable by the license type and the ordinance establishing the entertainment zone may be provided to patrons for purposes of participating in the entertainment zone’s privileges.
2. Patrons leaving the participating licensed premises with an open alcoholic beverage container must exit the premises directly into the established entertainment zone.
Additionally, this may only occur during the days and hours allowed by the ordinance establishing the entertainment zone.
3. No alcoholic beverages purchased at a participating licensed premises may leave the premises in an open glass or metal container.
4. Delivery of alcoholic beverages to consumers within the entertainment zone by the participating licensee or a third-party delivery service is prohibited unless the delivery is to a residential building or private business that is not a licensee.
5. Participating licensees whose privileges are restricted due to operating conditions or other statutory restrictions may be prohibited from exercising entertainment zone privileges that are contrary to those operating conditions or statutory restrictions. For example, a licensee with an operating condition that limits sales and/or consumption of alcoholic beverages to 10:00 P.M. must still abide by this condition regardless of the time allowable by the established entertainment zone. However, any operating conditions on the exercise of off- sale privileges shall not apply to the removal of open alcoholic beverage containers from the participating licensed premises for consumption within the entertainment zone.
It is the participating licensee’s responsibility to understand the privileges and restrictions associated with participating in an established entertainment zone. Any violations associated with a licensee’s participation in an established entertainment zone may subject the licensee to disciplinary action. Before participating in an established entertainment zone, licensees should familiarize themselves with the following sections of the ABC Act: Business and Professions Code Sections 23095.5, 23357, 23358, 23396, 25690, 25691, and 25692. Licensees should also be fully aware of the privileges and restrictions associated with the ordinance that established the entertainment zone.