SUBJECT: POLICY DISCUSSION ON SALE OF FOOD AND ALCOHOL AT GAS STATIONS

COUNCIL DISTRICT: CITYWIDE

SNI AREAS: ALL

RECOMMENDATION

Accept the report to support a policy discussion on the concurrent sale of food and alcohol at gasoline service stations.

BACKGROUND

In November of 1984, the City Council imposed a moratorium (Urgency Ordinance 21829) on the approval of combined convenience store/service station uses. In June 1985, Ordinance 22026 was approved by the City Council to replace the urgency ordinance permanently prohibiting the sale of food in combination with gasoline service stations. At the time of the moratorium, the City Council expressed concern over the growing number or combined convenience store/service station uses in the community. The changing nature of gasoline retailing at that time resulted in a reduced need for automobile repair and service being performed at stations thus resulting in a large number of gas station buildings, which could be utilized as a convenience market. The major concern raised at the time of the ordinance was the intensity of use on sites not originally designed for such intensity and the traffic impacts at intersections, particularly where gas stations are located on more than one corner of an intersection. Other concerns raised at the time included the location of most of the gasoline service stations in neighborhood-oriented commercial areas; however, the customers of these gas stations often came from beyond the immediate neighborhood. An additional concern was the potential for an increase in the number of outlets selling alcohol.

Staff from the Department of Planning, Building and Code Enforcement has been asked to prepare this memo to present all relevant issues associated with combined service station/convenience store uses. In addition to the history above, staff will present the current regulations, enforcement issues, crime statistics, and other relevant information for policy makers to consider in discussing this topic.

ANALYSIS

Current Zoning Regulations

The adoption of Ordinance 22026 in June of 1985 set in place the current prohibition on the combination of gasoline service stations with the sale of food, grocery items, or alcoholic beverages. This prohibition does not apply to the retail sale of prepackaged soft drinks, cigarettes, and snack foods from automatic vending machines. Additionally, there is no prohibition on other permitted uses in combination with the sale of gasoline. Other uses typically combined with gasoline service stations include the retail sale of auto related products, the installation of tires, batteries, and accessories, oil and lube services, and smog check services. A Planning Permit would be required to review any alterations to the site including the addition of parking and circulation as a result of the new use.

Other Regulations

City Regulation of Alcohol

The City has a long history related to the regulation of alcohol uses including both on-site consumption and sale for off-site consumption. Starting in 1965, the City prohibited drinking establishments in the C-1 Commercial district and prohibited nightclubs in the C-2 Commercial district. In 1968, the regulations were changed to require a Conditional Use Permit for nightclubs in the C-3 Commercial district. Prior to 1971, any type of drinking establishment was permitted in the industrial zoning districts. In 1971, the City restructured its industrial zoning districts to prohibit most commercial uses, including drinking establishments. In 1984, the City once again modified its commercial zoning regulations to require a Conditional Use Permit for drinking establishments in both the C-2 and C-3 Commercial zoning districts (still prohibited in the C-1). The regulation up through 1984 focused on uses that involve alcohol for on-site consumption.

In 1985, the City, in response to a concern over the growing number of convenience store uses combining with gasoline service station sites, either in operation or not in operation, the Council adopted an ordinance prohibiting the sale of food and alcohol in combination with the sale of gasoline (as discussed above). With an increase in the concern over the number of outlets selling alcohol for off-site consumption, the City, in 1990 adopted an ordinance requiring a Conditional Use Permit of any new uses involving the "off-sale" of alcohol. The adoption of this ordinance was prompted by a concern that the City was being overly impacted by alcohol sales.

In addition to the above regulations, in May 1993, the Council adopted an ordinance adding the adverse public impact provisions specific to nonconforming nightclubs and bars to the Zoning Code (Chapter 20.150, Part 2). In 1995 the adverse public impact provisions were expanded to include all nonconforming uses, including outlets that sell alcohol for off-site consumption.

State Regulation of Alcohol

The California Business and Professions Code, Section 23790.5 addresses local jurisdictions' ability to regulate the concurrent sale of motor vehicle fuel, beer and wine. In 1987, the State adopted a statute prohibiting any city, county, or city and county from taking any action that legislatively prohibits the concurrent retailing of motor vehicle fuel, beer and wine for off-sale consumption where the retailing of each is otherwise allowable. Included in the State statute is an exception that reads as follows:

This section shall not apply to a prohibition by a city, county, or city and county of the sale of beer and wine in conjunction with the sale of motor vehicle fuel if that prohibition occurs as a result of the prohibition of the combining of the sale of motor vehicle fuel with a broader class of products or uses which includes alcoholic beverages or beer and wine as a named or unnamed part of that larger class, if that prohibition was enacted before August 1, 1985.

The adoption by the City of San Jose City Council of Ordinance 22026, effective July 1985, qualifies for the exception to the State statute because the prohibition named the broader class of food and included alcohol, and the prohibition went into effect prior to August 1, 1985. In fact, the City of San Jose was successfully instrumental in getting this exception language included in this state legislation specifically for the purpose of “grandfathering in” its existing regulations on this topic. Any new legislation or modification of the current legislation related to the concurrent sale of motor fuel and alcohol would require the City to come into compliance with current State law.

Liquor License Exception Process

In January 1995, the State of California implemented changes to the Building and Professions Code as a result of the Caldera Bill (AB2897) that requires the Department of Alcohol Beverage Control (ABC) to deny an application for a liquor license "if issuance of that license would tend to create a law enforcement problem, or if the issuance would result in or add to an undue concentration of liquor licenses." Areas that have an undue concentration are defined as areas that have 20 percent more reported crimes than the average number of reported crimes for the City as a whole, or, census tracts where the ratio of existing retail on-sale/retail off-sale licenses to population in the census tract exceeds that same ratio in the County as a whole (Santa Clara County). The only way the ABC will issue a license in an area with undue concentration is if the City grants an "exception" based on "public convenience or necessity."

The Liquor License Exception process is an additional level of control the City has over the sale of alcohol that cannot be controlled through new land use regulations. As of March 31, 2003, the Census Tracts considered over-concentrated based on either crime statistics or existing license concentrations are located through the City, with the greatest number found in Council District 5. The physical area covered by these census tracts is approximately 40 square miles, 22.5 percent of the area of the City as a whole. A map depicting these Census Tracts will be provided at the Committee meeting.

Other Jurisdictions Regulation of Combined Uses

San Jose is able, in light of current State regulation, to prohibit the sale of alcohol in combination with the sale of gasoline because the City's prohibition was in place prior to the State enacting Section 23790.5 described above. The following page shows a chart that includes information on other jurisdictions in Santa Clara County and their regulation of alcohol and food sales in combination with a gasoline service station. As indicated in the chart, a prohibition on the concurrent sale of gasoline and food and alcohol is not unusual to San Jose.

Comparison of Jurisdictions in Santa Clara County Regulation of Combined Sale of Gasoline and Food and Alcohol
Jurisdiction	Regulation
San Jose	· Prohibits such combination of uses in all zoning districts. · Does not prohibit the sale of prepackaged food, soft drinks and cigarettes from automatic vending machines.
Sunnyvale	· Prohibits such combination of uses in all zoning districts.
Santa Clara	· Requires a Use Permit in all cases. · Alcohol sales are limited to beer and wine.
Fremont	· Conditional Use Permit required for combination of any use otherwise permitted in a zoning district with a service station. · Alcohol sales are required to be clearly incidental and accessory to the operation of the facility as a convenience food store.
Palo Alto	· Prohibits such combination of uses in all zoning districts. · Does not prohibit the sale of prepackaged food, soft drinks and cigarettes from automatic vending machines or on shelves occupying a floor area not to exceed forty square feet.
Cupertino	· Requires a Conditional Use Permit in General Commercial (CG) Zone. · Alcohol sales are limited to beer and wine.
Mountain View	· Conditional Use Permit required for retail sales of food, beverage, and other general merchandise. Products limited to convenience items for travelers. · Alcohol sales prohibited. · Upgrade of facilities to current site design standards is condition of Conditional Use Permit approval.
Los Gatos	· Conditional Use Permit required. · Any nonconforming uses are required to get a Conditional Use Permit for any expansion or alterations. · Sale of distilled spirits not allowed.

Strong Neighborhood Initiative

The City and the community have been working together through the Strong Neighborhoods Initiative Program to develop neighborhood improvement plans that support changes in the neighborhoods to create a stronger community. Many of the plans include a discussion as well as action items related to the proliferation of alcohol sales in their neighborhoods, including both bars and the sale of alcohol at liquor stores and convenience markets. Many of the communities have commented that they believe that alcohol related uses are disruptive to the community due to their contribution to criminal activity, loitering, littering, and excessive signage related to alcohol. The proximity of liquor outlets to schools are a concern to many of the SNI neighborhoods because of the children's exposure to alcohol on a daily basis through their walk to school and purchase of snack items at these stores. Many SNI Plans include action items related to the need to reduce the number of alcohol-related uses and ABC licenses issued in their neighborhoods. The Plans encourage more family-oriented commercial activities to support the broader needs of the community.

Crime Statistics

One of the major concerns voiced from the neighborhoods associated with convenience markets is the increased criminal activity associated with them. The City of San Jose Police Department tracks criminal activity and identifies the premises where the activity occurs. Staff has compiled two tables that present data for Part I crimes, defined as those crimes that the Police are required to report to the FBI, that are specific to convenience markets, including stand alone facilities and those in conjunction with a gasoline service station, and compare criminal activity at convenience markets to other premises of interest including liquor stores, gasoline stations without a convenience market, and larger scale supermarkets.

As depicted in Table 1, during the recent time period of February 1, 2002 to January 31, 2003, there were 237 reported incidents of Part 1 crimes at convenience markets. Of those incidents, 38% were for petty theft, and both armed robbery and aggravated assault each accounted for 16% of the incidents for a combined total of 70% of reported incidents at convenience markets.

TABLE 1 Breakdown of Part I Crimes at Convenience Markets February 1, 2002 - January 21, 2003
Incident Type	Total	% Of Total
Aggravated Assault^1	37	16%
Auto Theft	5	2%
Burglary, Commercial	13	5%
Burglary, Auto	11	5%
Grand Theft^2	14	6%
Petty Theft^2	89	38%
Rape	2	1%
Attempted Robbery	8	3%
Armed Robbery	38	16%
Strong Armed Robbery^3	20	8%
TOTAL	237	100%

Table 2 on the next page shows that liquor stores and gasoline stations without convenience markets, during the same time period, each had 89 reported incidents of Part I crimes, significantly less than convenience markets for the same time period. Similar to convenience markets, liquor stores and gasoline service stations had aggravated assault and armed robbery as a large percentage of the reported incidents at 44% and 35%, respectively. The comparison of convenience markets to supermarkets is provided primarily to show the fewer incidents of aggravated assault and armed robbery for supermarkets at 4% of total incidents compared to 32% of total incidents at convenience markets. It is clear from the data that a retail component to a use significantly increases the amount of petty theft and armed robbery incidents from a low of 30% at gasoline service stations without convenience markets to 39% at liquor stores, 54 % at convenience markets (including gas stations), and 82% at supermarkets.

TABLE 2 Comparison of Part I Crimes at Other Premises February 1, 2002 - January 21, 2003
Premises	Convenience Markets, including Gas Stations	Gas Stations	Liquor Stores	Supermarkets
Aggravated Assault^1	37	22	22	21
Auto Theft	5	4	0	6

Burglary, Commercial	13	5	19	10
Burglary, Auto	11	16	4	31
Grand Theft^2	14	8	4	49
Petty Theft^2	89	18	18	668
Rape	2	0	0	0
Attempted Robbery	8	2	0	6
Armed Robbery	38	9	17	11
Strong Armed Robbery^3	20	5	5	23
TOTAL	237	89	89	825

¹ - Aggravated assault includes the use of a weapon and involves bodily injury.

² - Grand theft includes $400 and up; petty theft is less than $400.

³ - Strong armed robbery involves threats, including with ones body, but does not involve a weapon.

Code Enforcement Issues

The Code Enforcement Division of the Department of Planning, Building and Code Enforcement receives complaints related to "minimarts" that include loitering, graffiti, excessive signage, public urination, and a general public nuisance. The neighborhoods complain that these uses become a magnet for undesirable and criminal activity, including drug dealing and robbery. It is anticipated that repealing the City’s current regulations prohibiting the concurrent sale of food and alcohol with gasoline would not contribute to an alleviation of this existing neighborhood concern.

COORDINATION

Preparation of this staff report has been coordinated with the Police Department and the City Attorney’s Office.

CEQA

Not a Project.

STEPHEN M. HAASE, DIRECTOR

Planning, Building and Code Enforcement