Published on December 11, 2007
ADULT BUSINESSES: ADULT BUSINESSES A UNIQUE FORM OF LAND USE Overview: Overview Why are we amending these ordinances? What is not changing? Undisputed revisions Decision points for Council City Policy: City Policy Legislative/Management Subelement of the General Plan: Goal 7.3B Assure that City policy is established, documented and enacted according to established procedures and legal principles. Policy 7.3B.3 Prepare and update ordinances to reflect current community issues and concerns in compliance with state and federal laws. Action Statement 7.3B.3b Consider changes to ordinances to reflect changes in community standards and state and federal laws. SMC Chapter 9.38: SMC Chapter 9.38 Unlawful Exposure of Private Parts or Female Breasts Adopted 1973, revised 1989 Based upon Penal Code Sections 318.5 and 318.6 Provides that it is a misdemeanor to expose female breasts, male or female private parts or buttocks in any establishment which serves alcohol, or to allow or provide such exposures in adult businesses SMC Chapter 9.40: SMC Chapter 9.40 Adult Entertainment Establishments – Licenses Adopted 1977; revised 1989 Establishes a comprehensive licensing scheme for adult entertainment establishments, including some facility operational requirements. Local Situation: Local Situation Sunnyvale has 4 live adult entertainment establishments listed on the Exotic Dancer Page Clubs of California Web Site. http://exclusivetvlnet.com/dancer/clubs Brass Rail Candid Club Hip Hugger Kit Kat bikini bikini bikini nude Local Situation: Local Situation Of the 65 California cities listed in mid-July 2000, only the 10 cities of Anaheim, Industry, Hollywood, Long Beach, Los Angeles, North Hollywood, Sacramento, San Diego, San Francisco and Van Nuys have as many or more adult clubs than Sunnyvale. San Jose has fewer clubs than Sunnyvale. Mega Business: Mega Business "The sex industry has never been better. The number of clubs in North America has doubled over the last decade to about 3,000. With an estimated 10 million customers in 1995, creating revenues of nearly 2 billion dollars, the clubs employ 250,000 dancers and countless other bartenders, bouncers, floor managers, disc jockeys and vendors. In 1995 one Gentlemen's Club chain headquartered in Houston began trading its stock publicly. Déjà Vu in Minneapolis with 150 dancers is part of a fast-growing national chain operating 7 nights per week.” --- Upscale Gentlemen's Clubs, A&E Investigative Reports, January 4, 2000 Mega Business : Mega Business "Clubs range from $10,000 per week sales in smaller areas to $150,000 to $200,000 per week sales where they can realize an income, bottom line pre-tax of $50,000 to $60,000 per week. That is the reason Gentlemen's Clubs are multiplying. It is a profitable business, more so than a typical nightclub.” --- Michael J. Peter, "Founding Father” and owner of over 60 clubs, headquartered in Orlando, Florida --- Upscale Gentlemen's Clubs, A&E Investigative Reports, January 4, 2000 Authority to Regulate Adult Businesses: Authority to Regulate Adult Businesses Time Place (Zoning, Title 19) Manner restrictions Government Code § 65850.4 Penal Code § 318.5, §318.6 “Manner” or Operation of Business: “Manner” or Operation of Business Cities can impose reasonable operational conditions, such as Licensing requirements No touching No direct tipping Management supervision Case Law Lessons: Case Law Lessons Cities can restrict public nudity Cities can regulate live entertainment whether or not alcohol served But cities cannot “criminalize” sexual conduct Revisions Prompted By: Revisions Prompted By Penal Code Sections 318.5 and 318.6 amended in 1998 (pertaining to nudity in adult entertainment establishments) Code of Civil Procedure § 1094.8 adopted in 1999 (pertaining to time lines for judicial review) At least 5 major U.S. Supreme Court cases and 3 major Ninth Circuit court cases on various aspects of adult entertainment since the 1989 revisions to the Municipal Code. Procedural Due Process: Procedural Due Process All First Amendment activities subject to “prior restraint” scrutiny Requires “expedited judicial review” Baby Tam and Co. v. City of Las Vegas, 154 F.3d 1097 (9th Cir. 1998) (Baby Tam I) Discretionary conditions precedent operate as prior restraint Baby Tam and Co. v. City of Las Vegas, 199 F.3d 111 (9th Cir. 1999) (Baby Tam II) Nudity Restrictions: Nudity Restrictions Content-neutral ordinance prohibiting public nudity upheld Regulation aimed at reducing adverse secondary effects Cities can rely on evidence from other cities Pap’s A.M. v. City of Erie, 120 S. Ct. 1382 (Kandyland) Proposal: Proposal Update Municipal Code Chapters 9.38 and 9.40 Potential Regulatory Approaches to Nudity: Potential Regulatory Approaches to Nudity City may legally adopt: A total ban on nudity in any public place. A total ban on nudity in any adult business. A partial ban on nudity in any adult business serving alcohol. (ABC Rule 143.3) Council has never addressed banning nudity "in any public place." The focus is nudity in adult businesses. Proposed Revisions to Chapter 9.38: Proposed Revisions to Chapter 9.38 Eliminate the misdemeanor aspect of any violation of the ordinance. The restrictions on nudity are simply a condition of an adult business license, not a criminal violation. Specify that any nude entertainment business not serving alcohol existing as of January 1, 2000 may continue but no other all nude establishments will be allowed. Practical Effect: Kit Kat Club may continue all nude format indefinitely. Proposed Revisions to Chapter 9.38: Proposed Revisions to Chapter 9.38 Delete the theater exemption to be consistent with Penal Code §§ 318.5 and 318.6. Any business which "regularly features" adult entertainment is covered by the ordinance or state law. A production, such as Hair, is not affected. Businesses serving alcohol may not have nude servers or entertainers. Practical Effect: Current formats at Brass Rail, Candid Club and Hip Hugger are permitted. Proposed Revisions to Chapter 9.40: Proposed Revisions to Chapter 9.40 Procedural and administrative aspects Facilities and operations requirements (9.40.160) Procedural and Administrative Aspects: Procedural and Administrative Aspects 9.40.010 Purpose and Intent 9.40.020 Definitions 9.40.030 Excluded activities 9.40.040 License required 9.40.050 Application 9.40.060 Application processing 9.40.070 Denial of license 9.40.080 Appeal of denial 9.40.090 Reapplication after denial 9.40.100 Grounds for suspension or revocation 9.40.110 Notice of violations 9.40.120 Hearing procedures 9.40.130 Appeal of decision 9.40.140 No fee refund 9.40.150 Return of license 9.40.170 Inspection by public officials 9.40.180 Business name 9.40.190 Business location change 9.40.200 Transfer of interest 9.40.210 Display of license 9.40.220 Registration of employees and entertainers 9.40.230 Application to existing businesses Procedural and Administrative Aspects : Procedural and Administrative Aspects 9.40.010. Purpose and intent State clearly that the intent is to provide standards and guidelines to regulate time, place and manner of the operation of adult businesses in order to minimize the adverse secondary impacts. State clearly that it is not the intent to impose limitations or restrictions on the content of any communicative materials, nor to restrict or deny access by adults to adult-oriented materials or entertainment. Current ordinance deals with first of these but is silent on second. Procedural and Administrative Aspects: Procedural and Administrative Aspects 9.40.020. Definitions Defines numerous terms: adult arcade, adult bookstore, adult business, adult business operator, adult business owner, adult cabaret, adult entertainment enterprise, adult entertainment room, adult hotel/motel, adult merchandise, adult modeling studio, adult motion picture theater, adult visual materials or video store, applicant, distinguished or characterized by an emphasis upon, employee, entertainer, licensee, nudity or state of nudity, operate an adult business, person, public safety department, regularly features, semi-nude, specified anatomical areas, specified sexual activities. Current ordinance contains fewer definitions Procedural and Administrative Aspects: 9.40.030. Excluded activities Excludes activities covered by other specified provisions of state or local law, or activities covered as part of the educational program of a school district or public agency Essentially unchanged 9.40.040. Adult business license required Specifies that a license must be obtained from Public Safety prior to operation of an adult business Essentially unchanged Procedural and Administrative Aspects Procedural and Administrative Aspects: Procedural and Administrative Aspects 9.40.050. Application for adult business license Sets out the details of the required application materials More details on layout of facility and operation required and more information on the owners and operators of the business. Procedural and Administrative Aspects: 9.40.060. Application processing Sets out how the application is processed, including applicable time frames New in terms of establishing time frames within which City must act, as required by Baby Tam cases and Code of Civil Procedure Section 1094.8 9.40.070. Denial of license Sets forth the grounds upon which a license may be denied Essentially unchanged, although incorporates time frame consistent with Baby Tam cases Procedural and Administrative Aspects Procedural and Administrative Aspects: 9.40.080. Appeal of denial Details how a denial may be appealed through the City and to the Court, including applicable time frames Modified to reflect requirements of Code of Civil Procedure Section 1094.8, resulting from Baby Tam cases 9.40.090. Reapplication after denial Discusses applying after a denial Unchanged Procedural and Administrative Aspects Procedural and Administrative Aspects: 9.40.100. Grounds for suspension or revocation Identifies the acts or omissions which may lead to suspension or revocation of a license. Previously referred to as disciplinary action, but otherwise essentially unchanged except for one deletion related to bookstores and obscene material due to case law. Procedural and Administrative Aspects Procedural and Administrative Aspects: 9.40.110. Notice of license violations Defines the requirements for giving notice of any violations which may be grounds for suspension or revocation Essentially unchanged 9.40.120. Hearing procedures Sets forth how a suspension or revocation hearing is to be conducted, including applicable time frames Essentially unchanged Procedural and Administrative Aspects Procedural and Administrative Aspects: 9.40.130. Appeal of decision Details how a suspension or revocation decision may be appealed through the City and to the Court, including applicable time frames Modified to reflect requirements of Code of Civil Procedure Section 1094.8, resulting from Baby Tam cases Procedural and Administrative Aspects Procedural and Administrative Aspects: 9.40.140. No refund of fee If a license is discontinued for any reason, no fees are refunded Unchanged 9.40.150. Return of license A license which is cancelled, suspended, revoked or invalidated must be returned Unchanged Procedural and Administrative Aspects Procedural and Administrative Aspects: 9.40.170. Inspection by public officials Provides for routine inspections by public officials Essentially unchanged 9.40.180. Business name The name under which the business operates must be specified in the license Essentially unchanged Procedural and Administrative Aspects Procedural and Administrative Aspects: 9.40.190. Business location change A change in location requires a new application Essentially unchanged 9.40.200. Transfer of interest Licenses cannot be transferred or assigned Unchanged 9.40.210. Display of license Licenses must be displayed openly and conspicuously Unchanged Procedural and Administrative Aspects Procedural and Administrative Aspects: 9.40.220. Registration of employees and entertainers Employees and entertainers must be registered by the licensee with Public Safety within 5 days of employment or engagement and the rosters kept current Required information includes personal and public information and is for the purposes of facilitating identification of individuals by Public Safety in event of emergency or incident. Procedural and Administrative Aspects Procedural and Administrative Aspects: 9.40.230. Application to existing establishments Provides that within 90 days of adoption, any existing unlicensed business must apply for a license and comply with requirements, except that existing businesses are grandfathered in and do not have to meet location requirements of zoning code. Also provides that if there is an agreement with business as to specifics of operation, that agreement takes precedence over conflicting terms in ordinance. This acknowledges pre-existing agreements with Kit Kat Club and Contemporary Bookstore. Essentially unchanged Procedural and Administrative Aspects Facilities and Operations Requirements9.40.160: Facilities and Operations Requirements 9.40.160 14 facility and operational requirements (some with multiple parts) are proposed Some are carryovers from the existing Chapter 9.40, state law or existing agreements with existing business operators Some are new but are acceptable to the club owners Very few points of contention present policy decisions to be made by the City Council Carryover Requirements: Carryover Requirements Compliance with all building, fire, electrical, plumbing, health and zoning requirements and chapter requirements Nothing related to specified sexual activities or specified anatomical areas may be visible from any public way or exterior of the building No business shall be partitioned or divided into any private booths or cubicles closed to view. Does not apply to the existing adult bookstore which has private booths allowed under an existing agreement. (Sec. 9.40.230) Carryover Requirements (cont.): Carryover Requirements (cont.) In an adult arcade, no viewing room may be occupied by more than one person at any time No person shall perform live entertainment except on a stage at least 18 inches above the floor. ABC regs prohibit the exposure of breasts and/or buttocks unless the entertainer is on a stage at least 18 inches in height and 6 feet from patrons. No physical contact during performances between patrons and entertainers. This is a condition in an existing agreement with the Kit Kat Club. (Sec. 9.40.230) Undisputed Requirements: Undisputed Requirements Any new adult businesses must be closed from 2:00 a.m. to 9:00 a.m. [time] Existing adult businesses do not have hours of operation restrictions All off-street parking areas and entries to businesses shall be illuminated from dusk to closing. All interior areas of adult business shall be illuminated at minimum lighting levels. Undisputed Requirements (cont.): Noise generated inside shall not be audible outside the establishment. A hearing shall be held by the Director of Public Safety if there are noise complaints. Entrance shall be clearly posted with a notice that minors are not permitted inside. All indoor areas within which patrons are permitted, except rest rooms, shall be open to view by management at all times. Undisputed Requirements (cont.) Undisputed Requirements (cont.): There shall be separate restroom facilities for males and females, if there are public restrooms. Restrooms may not contain video surveillance, broadcast or reproduction equipment. In an adult arcade, walls or partitions between viewing areas shall be maintained in good repair with no holes and areas shall be kept clean. Loitering is not permitted. Undisputed Requirements (cont.) Undisputed Requirements (cont.): In businesses providing live entertainment: There shall be separate dressing room facilities for entertainers which shall not have cameras or surveillance devices. There shall be access between the dressing rooms and stage that separates entertainers from patrons or other measures taken to insure no physical contact of entertainers by patrons. Configurations of existing businesses need not be altered. Undisputed Requirements (cont.) Controversial Items: Controversial Items Registration requirements Distance between patrons and entertainers during a performance Physical contact between patrons and entertainers. Issue of tipping or gratuities placed on the body or in the clothing of the entertainer Tips to the Hips Level of security staffing Policy Decisions: Policy Decisions Amount of registration information Proximity of patrons to entertainers Amount of contact between patrons and entertainers Amount of security required at live entertainment establishments
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