To: Santa Monica City Council
From: Eric Sedman, Chair of the Board of Directors
Subject: Promenade Outdoors Permit Program
Date: September 12, 2022
Downtown Santa Monica, Inc. (DTSM) Board of Directors Recommendation The DTSM Board of Directors recommends that the Santa Monica City Council extend the Temporary Use of Public Space Permit Program to February 28th, 2023 to maintain the existing outdoor dining conditions on Third Street Promenade. The complete Board of Directors recommendation is listed below:
“In line with the purpose of the Temporary Use of Public Space Permit Program, Downtown Santa Monica, Inc. recommends that City Council and City staff explore all options, by any means necessary, to maintain the current conditions of outdoor dining on the Promenade, from no fees to extended outdoor dining options in the roadway.” If the Temporary Use of Public Space Permit Program cannot be extended due to the termination of the Covid-19 Emergency Orders, the DTSM Board requests that City Council and City staff examine all possible alternatives from fee resolutions to waive fees or provisional permits to allow for the continuance of the current state of outdoor dining on the Promenade.
In short, we are requesting time. Time to build out a program that works for all businesses and residents and recognizes the economic hardships of restaurants on the Promenade. The information below details the gravity of the business conditions on the Promenade and enumerates the current factors that are affecting the viability of operators to keep their doors open.
Background Information
Successful downtowns boast a range of business options that attract visitors and residents alike. Outdoor dining not only benefits restaurants, but locals and visitors who expect a range of shopping, leisure and dining options when frequenting Third Street Promenade.
Outdoor dining has served as a lifeline for Promenade restaurants that have struggled to recover from the adverse effects of the pandemic, as well as recent inflation related cost hikes. An increase in fees and a pullback of outdoor dining options will Doc ID: 4e8c54a44311fce35c14b65761c491646888b2d3
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force restaurants on the Promenade to make hard decisions regarding the viability of their business.
Decreased foot traffic and a correlated decrease in sales challenges the ability of restaurants to keep their doors open on the Promenade. The pedestrian recovery from the pandemic started strong in the beginning of 2022 with February seeing roughly the same number of pedestrians as February 2019. However, the pedestrian recovery since that point has fallen precipitously. The summer months have seen a reduced pedestrian recovery with August registering roughly 1.83 million pedestrians, down 370K visitors from July and down 690K visitors from August 2019 (See Attachment A).
The month of August saw fewer pedestrians on the Promenade than the month of March. In fact, the summer months (June through August) of 2021 saw more pedestrian impressions than the 2022 summer months.
Inflation related price increases have added additional constraints to restaurants on the Promenade. Some key Cost of Goods Sold (COGS) increases over the last 12 months are:
o Wholesale food + 13.4%1
o Eggs +156%
o Butter +61%
o Flour +39%
Thank you for your attention to this matter and please do not hesitate to reach out with any questions.
Sincerely,
Eric Sedman
Board Chair
1 https://restaurant.org/research-and-media/media/press-releases/inflation-reduction-act-will-not-help-restaurants/2http Doc ID: 4e8c54a44311fce35c14b65761c491646888b2d3
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Attachment A: Promenade Pedestrian Counts
These pedestrian impressions, calculated using Springboard sensors, display the monthly pedestrian counts on the Promenade.
Doc ID: 4e8c54a44311fce35c14b65761c491646888b2d3
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1 Vernice Hankins
From: Tricia Crane <[email protected]>
Sent: Monday, September 12, 2022 5:08 PM
To: Sue Himmelrich; Kristin McCowan; Christine Parra; Lana Negrete; Phil Brock; Oscar de la Torre; Gleam Davis; councilmtgitems; David White; Susan Cline; Anuj Gupta Cc: stevan hill
Subject: A resident member of NE Neighbors would like to know why Santa Monica chooses not to underground fiber optics
EXTERNAL
Dear City Manager and Council,
Below is a letter from a resident who asked that I forward this inquiry to you.
Thank you for any information.
Tricia Crane
Chair, Northeast Neighbors
On Mon, Sep 12, 2022 at 7:20 AM stevan hill <[email protected]> wrote:
Tricia,
Please help with bringing attention to wires that the city are letting fiber optics companies add to the poles instead of underground.
Other cites like Culver City are putting everything underground. Our city looks like third world with wires above ground !
Thanks
1048 Berkeley Street
Business Development for North America
First Green Industries ‐FGI
[email protected]
Pardon the typos and brevity...Sent from a handheld device. ‐‐
‐‐
Stevan
Stevan Hill
Business Development for North & South America
First Green Industries ‐ FGI
310‐880‐9200
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From: Anthony Schmitt <[email protected]>
Sent: Tuesday, September 13, 2022 8:02 AM
To: councilmtgitems
Subject: Parklets fee, waiver or grants... for your consideration.
EXTERNAL
To the council of Santa Monica.
If you would consider, as part of the pilot program, for the parklets. The one time fee is excessive. Given that the operators of the parklets went to great expense to build at a time that it was a challenge to have seats filled at restaurant's. Would you consider waive or payments for your one time fee? It seems that we are still in an economic recovery period.
The fee, seems to be passing on the expense of krails to the restaurant's now that it's permanent and not the partnership with the city. If there is no storage space, why are we taking something away, or tearing down what is built to provide patrons an outdoor space? For the comfort of health and well being...
Please, forgive the expense, and have the fee be per outdoor seat, not square footage given the commitment to continue social distancing as we continue to do, what we can to maintain a healthy and vibrant dining experience on Main street.
Thank you, for your continued leadership towards what economic recovery looks like.
As we work together, to keep retail and restaurant's their employees and patrons supported.
Anthony Schmitt
Chairperson MSBIA
Thank you.
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From: adnan safadi <[email protected]>
Sent: Tuesday, September 13, 2022 9:13 AM
To: councilmtgitems; City of Santa Monica; David White; Gleam Davis; Phil Brock; Christine Parra; Lana Negrete; Sue Himmelrich; Kristin McCowan; Oscar de la Torre Subject: Stop the mandates dummies
EXTERNAL
Hi Santa Monica City Government:
Why hasn’t the City of Santa Monica lifted their vaccine mandates? Because science?
Because Trump?
Because gun control?
Because Roe vs Wade?
Because transgender youth?
Because needle exchange?
Because the “vaccine” doesn’t stop you from contracting or transmitting Covid? Because Santa Monica’s City Government prefers mandating to governing? You're subverting democracy AND destroying Santa Monica. Double fail. If you don’t believe me just take a drive to Orange County and take a look at how NO mandates and NO lockdowns and NO defund the police has worked out much better than mandates and lockdowns and defunding the police.
Stop the mandates dummies.
Adnan
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From: Denise Anderson-Warren
Sent: Tuesday, September 13, 2022 10:08 AM
To: councilmtgitems
Subject: Fwd: Agenda Item Addition Tonight - Outdoor Dining on the Promenade From: Kayla Smith <[email protected]>
Sent: Tuesday, September 13, 2022 9:48:08 AM
To: Sue Himmelrich <[email protected]>; Gleam Davis <[email protected]>; Lana Negrete <[email protected]>; Kristin McCowan <[email protected]>; Christine Parra <[email protected]>; Phil Brock <[email protected]>; Oscar de la Torre <[email protected]>; David White <[email protected]>; Douglas Sloan <[email protected]>; Denise Anderson‐Warren <Denise.Anderson‐[email protected]> Cc: Lucian Tudor <tudor.lucian.silviu@global‐dining.com>; Toru.Toyokawa <toyokawa.toru@global‐dining.com> Subject: Agenda Item Addition Tonight ‐ Outdoor Dining on the Promenade
EXTERNAL
Good Morning Santa Monica City Council,
Hope you're all having a terrific week so far. I wanted to share with you a few links from a Press Conference we had yesterday in regards to the Outdoor Dining on the 3rd Street Promenade and the effects it will have on employees & business owners. In addition, I have attached a link to our Petition to keep the Outdoor Dining Area with over 3,300 signatures from Santa Monica locals. https://ktla.com/news/local-news/santa-monica-business-owners-plead-for-outdoor-dining-to-beextended-on-3rd-street-promenade/ https://www.univision.com/local/los-angeles-kmex/santa-monica-busca-poner-fin-al-servicio-al-airelibre-de-algunos-restaurantes-latinos-se-verian-afectados-video https://chng.it/gDXTdq8t5T
The community is talking about this. We are asking if you can please add this item to your agenda today.
We have decided to close our doors at the restaurant today in order to help our staff come attend the meeting tonight to advocate their jobs and lives.
Please let me know if you have any questions or if I can provide any other information. We look forward to seeing you all tonight. Thank you again for your time.
Kayla Smith
Marketing, PR, & Event Manager
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2 Global Dining Inc of California
1212 3rd Street Promenade
Santa Monica, CA 90401
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From: Ann Hsing <[email protected]>
Sent: Tuesday, September 13, 2022 10:28 AM
To: Council Mailbox; councilmtgitems
Cc: Hunter Hall; Brian Bornemann
Subject: Crushing Wastewater Fees for Parklets
EXTERNAL
Dear Santa Monica Council Members,
My name is Ann Hsing, and I'm the Chief Operating Officer and a Managing Partner at pasjoli, a restaurant located on Main Street.
I'm writing to ask you to please consider eliminating the wastewater fees that are being imposed on restaurants in our permanent outdoor dining fees associated with our parklets.
The parklets have been a huge success ‐ not only helping hospitality businesses survive through the worst periods of the pandemic but also helping us recover our losses that have accumulated over the past two years. In addition, it has brought Main Street back to life. We see new businesses open every day and hear about many more to come. As a business owner, I understand the need to collect fees on these parklets. However, asking restaurants to pay $1,359.49 per seat for wastewater fees is extraneous and onerous. For a small restaurant that has 20 seats on an outdoor patio, that's almost $30K in wastewater permit fees alone.
Restaurants do not function with high margins. Our costs continue to rise each day. The price of something as simple as eggs has more than tripled since 2020. Healthcare costs have increased over 40% for us this year. We have struggled to not dramatically increase prices and as a result have taken a hit to our bottom line. If we were required to pay these fees, we would have to choose between operating our outdoor patio or increasing our prices dramatically.
Neither of these options would be a benefit to the neighborhood. We are so proud to be a part of the Santa Monica Main Street community and want to help continue to build Main Street, but these fees are really crushing to our business. Please eliminate them or else many businesses will be forced to close up their outdoor patios and the luster of Main Street will begin to fade.
Thank you for your consideration,
Ann
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From: Hunter Hall <[email protected]>
Sent: Tuesday, September 13, 2022 10:35 AM
To: Council Mailbox; councilmtgitems
Cc: Sean Besser; [email protected]
Subject: Please reduce/eliminate Wastewater Fees for parklets!
EXTERNAL
Dear council‐members,
Thank you so much for everything you’ve done with the Parklet program so far and for making it permanent.
That said, many businesses are shocked and dismayed to see just how expensive the wastewater fees are and the timeframe they have to pay them.
For a business to be expected to pay tens of thousands of dollars upfront with no clear way to finance it is unreasonable, and will only encourage people to get rid of their Parklets, which is against the entire ethos of everything we have done as a community so far.
There was not much pushback to the concept of fees up until this point because all of the other fees including Plan Check, monthly rent, etc. are reasonable and were expected. The wastewater fee is unreasonable, unaffordable, and was unclear.
These fees should be greatly reduced, removed entirely, or at the very least businesses should be given 1 to 2 years to finance them.
On another note: Existing Parklets that are larger than two spaces should be allowed to remain as is if the operator wishes. It is unreasonable to expect a business that has invested tens of thousands of dollars to take away a much‐ needed source of revenue generation.
If the result of these fees/regulations is that Santa Monica has less outdoor dining, then everyone loses.
Respectfully,
Hunter G. Hall
Executive Director
MSBIA
314.323.4663
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1 Vernice Hankins
From: Brian Bornemann <[email protected]>
Sent: Tuesday, September 13, 2022 11:42 AM
To: councilmtgitems; Council Mailbox
Cc: [email protected]; Chuck Craig; Ann Hsing; Hunter Hall Subject: meeting notes for tonight, re parklet fees
EXTERNAL
Hello,
There is one pertinent matter that I would like to discuss tonight, please see below:
As business owners, my partner and I, as well as our colleagues with whom we have all counseled, completely understand the need to charge for space. We understand the need to charge rent for the former parking spaces being used. We are completely willing to look the other way when reapplying for the parklet and paying for $5k in plan check and fire department fees. However, the 'waterwaste capital facility fees' are erroneous, arbitrary, and untenable, we maintain that is in the city's and the businesses' best interest that these fees are nullified. We request that these fees be removed from the permanent parklet program manual.
It is clear that the city is trying to make restaurants pay for what had to happen as a result of pandemic seating.
The need to sit outside during a pandemic is of course nobody's fault. Yet, if the city had not created these parklets on Main street our business, along with many others, would not have been successful there. Yes, these parklets helped our businesses survive, but that is all that they did. These fees show a clear lack of understanding for restaurant margins and operations, the very businesses that you are touting to have helped with this. By creating these parklets, the city gains revenue already from our sales tax, from our numerous other fees and bills, and from the traffic that we bring to Santa Monica. Our colleagues and we recently got Main st. to be named ' The Coolest Place to Eat in LA' and we are drawing tourism from all over the county, and beyond, into Santa Monica, thereby creating revenue, including all of their parking, for the city. So why would the city reward our new attention with crippling fees that would then force us to not be able to operate? The fees being imposed are not tenable for us and if the city enforces these, we will be forced to take out business elsewhere.
thank you,
‐‐
Brian Bornemann
Executive Chef & Co‐Owner
Crudo e Nudo ‐ 2724 Main st, Santa Monica 90405
Bella Dea ‐ 27 Morton st, NYC 10014
cell 310‐467‐0883
shop 310‐310‐2120
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From: Michael Bezerra <[email protected]>
Sent: Tuesday, September 13, 2022 11:52 AM
To: councilmtgitems; Council Mailbox
Cc: Alexandra Stafford; Hunter Hall
Subject: PLEASE READ RE: Wastewater Fees in Santa Monica
EXTERNAL
Dear Councilmembers,
I write to you as a concerned business owner/operator with regard to the exorbitant and impending Wastewater fees being imposed on us and our fellow hospitality establishments throughout the city of Santa Monica. Not only will this cost be burdensome on us, but it will be a determent to the health of the business community. In addition, these fees contradict the main purpose of our outdoor spaces, being to aid hospitality establishments in recovering from the pandemic and overall survival. Imposing these extravagant fees is a major leap back from that purpose and goal. I fear many will not be able to afford these fees and will be forced to remove valuable and necessary seating that attributes to the continuation of many businesses.
Please understand that our outdoor dining areas at our restaurants not only allowed us to stay in business during Covid, but it prevented the loss of jobs, added jobs, and activated an unprecedented vitalization of the 3rd St. Promenade as well as on Main St. We cannot see our communities lose these essential dining areas due to this extra expense.
In conclusion, I implore you to either dramatically reduce the proposed fee amount or offer a financing option that allows businesses to pay in installments over time. By doing so you will be preventing a grave hindrance on the business community of Santa Monica.
Thank you for your consideration,
Michael Bezerra
Owner/Operator
Michael Bezerra
Sunset Restaurant Management Group
Office: 323.822.0817 | Fax: 323.822.0871 | Cell: 310.666.6250 Email: [email protected]
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From: Dan Londono <[email protected]>
Sent: Tuesday, September 13, 2022 11:52 AM
To: councilmtgitems; Council Mailbox
Subject: Feedback on Parklet Fees
EXTERNAL
Hello,
I am writing on behalf of Alfalfa Santa Monica, to express the feedback that the wastewater fees for permanent parklets are excessive and unexpected. Restaurants continue to struggle with labor and COGS inflationary pressures, and likely facing a recession at some point soon. We are doing our best to create beautiful experiences on Main Street with our service, products and parklets, in order to attract more business for the city. Please consider making parklets more affordable to operate, especially given the thousands we spent building them out and the challenging local business environment.
Thanks,
Dan
DAN LONDONO
Co-Founder | Alfalfa
973-868-2762 | eatalfalfa.com
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From: Alexandra Stafford <[email protected]>
Sent: Tuesday, September 13, 2022 11:55 AM
To: councilmtgitems; Council Mailbox
Subject: Regarding Wastewater Fees in Santa Monica
EXTERNAL
Dear Councilmembers,
I write to you as a concerned employee of a Santa Monica business owner/operator with regard to the exorbitant and impending Wastewater fees being imposed on us and our fellow hospitality establishments throughout the city of Santa Monica. Not only will this cost be burdensome on us, but it will be a determent to the health of the business community. In addition, these fees contradict the main purpose of our outdoor spaces, being to aid hospitality establishments in recovering from the pandemic and overall survival. Imposing these extravagant fees is a major leap back from that purpose and goal. I fear many will not be able to afford these fees and will be forced to remove valuable and necessary seating that attributes to the continuation of many businesses.
Please understand that our outdoor dining areas at our restaurants not only allowed us to stay in business during Covid, but it prevented the loss of jobs, added jobs, and activated an unprecedented vitalization of the 3rd St. Promenade as well as on Main St. We cannot see our communities lose these essential dining areas due to this extra expense.
In conclusion, I implore you to either dramatically reduce the proposed fee amount or offer a financing option that allows businesses to pay in installments over time. By doing so you will be preventing a grave hindrance on the business community of Santa Monica.
Thank you for your consideration,
Alexandra
Alex Stafford
Executive Assistant | Sunset Restaurant Management Group Phone: 323.822.0849 ext 101 Fax: 323.498.0812
Email: [email protected]
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