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Residents discuss pros, cons of tasting rooms

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It was an entirely civil meeting, with two sides debating the merits of wine tasting rooms and what, if anything, should be done about them.

On one side, local vintners say the current system is working fine without any interference, and that tasting rooms are improving Sonoma for tourists and locals alike. On the other, some residents say the sheer number of tasting rooms is threatening the character of Sonoma’s historic downtown and Plaza.

The special meeting – held Monday night as a joint session between the City Council and Sonoma Planning Commission at the Sonoma Community Center – was called in response to this growing controversy, with a chance for the public to weigh in. About 20 people did so, out of approximately 50 people in attendance.

“There’s a concern that I heard, and that I share, that there is a critical mass” in terms of how many tasting rooms the Plaza can accommodate, said Councilmember Steve Barbose, who called the special meeting in the first place.

Barbose’s comments – delivered early in the meeting, along with those of other city officials – made him a voice for the pro-regulation side Monday night. He praised the downtown area’s current tasting rooms (“You’ve done a terrific service for our community”) while also expressing belief that regulation of some sort was in order.

According to Planning Director David Goodison, there are now 23 tasting rooms and wine bars located within the “Plaza overlay zone” – generally the streets fronting the Plaza – representing 17 percent of total commercial space there. Counting nearby commercial spaces “brings the number of facilities in the vicinity of the Plaza to 29,” he said. This does not include full bars like Steiner’s or restaurants serving alcohol.

Barbose made it clear that, “As to the existing tasting rooms, there is no thought on anyone’s part” that they should be forced to obtain more licensing or be put out of business. But while several vintners and city leaders – including Planning Commissioner Gary Edwards, Councilmember David Cook and Mayor Tom Rouse – said the city should let the market decide the fate of downtown tasting rooms, Barbose said he doesn’t believe “the free market system is going to protect the character of our community.”

“We all understand that tourism is an important part of our economy, but we need to balance that,” Barbose said, with the needs of “those of us that live here 365 days a year.”

But when it comes to how to balance those needs, things get complicated quickly. A set of recommended regulations, approved by the Planning Commission in January and now awaiting council approval, offer one way – though not the only way – that tasting rooms could be regulated.

As Goodison explained, there are two types of alcohol licenses (granted by the state Department of Alcoholic Beverage Control) most relevant to the issue: Type 02 licenses, which many small vintners and tasting room operators use, and Type 42 licenses, which are “better described as wine bars or tap rooms.” In the latter case, purveyors can serve both beer and wine by the glass, while vintners with Type 02 licenses can serve only their own wines in small pours.

Currently the city regards tasting rooms operated by Type 02 license-holders as retail space, meaning they do not require use permits. But Sonoma could opt for a two-tiered approach, Goodison said, designating “wine tasting rooms limited” and “wine tasting rooms extended” and regulating each differently. These two tiers could be defined by their size, hours of operation or other details.

Or the city could simply put a cap on the total number of tasting rooms allowed downtown, although this option didn’t seem to have much support among city leaders. “We’re not aware of any community that has a stated cap on wine tasting facilities,” Goodison said.

But whatever the city opts for, some said it would be better than the current regulation of small tasting rooms with Type 02 licenses, which is nonexistent.

As a result, tasting rooms are taking over, said Larry Barnett, a leader of the local movement to regulate them.

“The rent increases are forcing out existing retailers” around the Plaza, Barnett said, which is why he advocates putting a cap on their total number. “If they (retail spaces) all get filled up with tasting rooms, you’ll have no room for experimentation” among local businesses.

Barnett also spoke of the “historic status of the Plaza – what does that dictate in terms of usage and activity?” And he added he is “always amused” by invocations of the free market, which “somehow is unerring and always plays its hand properly. Sounds too mythological to me.”

“Wine has a cachet,” he said, but “how long will it be … when that cachet turns into a cliché?”

On the other side, some said the local vintners operating tasting rooms represent the real Sonoma – better, in fact, than any other retailer could.

“If you come in and sell sweaters, those sweaters are probably made somewhere else,” said Planning Commission member James Cribb. “But if you come in and sell wine, that wine is made right here … they’re part of our artisanal food production.”

Danny Fay, a cofounder of Envolve and one of the most vocal defenders of tasting rooms, began his three-minute talk by noting that his home, office and tasting room are all at the same address.

“I could probably argue I spend more time downtown than anyone else,” he said.

Fay took a reportorial approach to the issue, walking the Plaza on different days with an eye out for the “debauchery” and “lack of diversity” supposedly caused by tasting rooms like his.

His conclusion: “The most debauchery I saw throughout any of the days was in the rose garden next to the visitors bureau” – a reference to the heavy drinkers who regularly congregate there. The remark brought laughter and applause, and Sonoma Police Chief Bret Sackett, sitting in the second row, was heard to say, “I don’t disagree with that at all.”

As for diversity, Fay said spaces like his are taking up “only a third of the entire downtown area … We have just as many women’s clothing stores as we do tasting rooms downtown.”

“That’s your free market for you right there,” Fay said.

But those remarks were followed by downtown resident John Kelly, who admonished city leaders to take care of an area that is “anything but a free market.”

“The Plaza is a park,” he said. “It’s your job as a council to protect it.”

The speakers split roughly down the middle in terms of whether they thought regulating tasting rooms was a good idea or not. Several in the wine industry pointed to the positive side effects of tasting rooms – as when Sherrie Perkovich of Sojourn Cellars noted how often tourists ask pourers for advice on where to eat, shop or stay.

“We’re almost like a mini concierge service” for Sonoma,” she said, adding, “Our primary source of revenue is these tasting rooms.”

Squire Fridell, of GlenLyon Vineyards & Winery, went a step further, saying that tasting rooms are part of the local fabric.

“Without wine, Sonoma would be another Vallejo. It would be Benicia,” he said. “This is a destination.”

Fridell, who runs a tasting room on East Napa Street, added that “Before we started Wine Alley, there was nothing there. There were no shops that could succeed.” Today, he said, the city is “in the black” – and he believes tasting rooms should get some of the credit.

Still, the matter of adverse side effects remained. Responding to questions from Rouse about public safety, Sackett said there was good reason to want to regulate alcohol purveyors, as “logic would dictate the more opportunity there is for alcohol, the bigger propensity for problems.”

As an example, when Plaza Liquors closed, before re-opening under new ownership,“We did have a considerable reduction in alcohol-related crimes on the Plaza,” he said.

But later in the week, Sacket clarified that, “I’m not as concerned about Type 02 licenses,” but mainly wanted to call attention to possible abuses by holders of Type 42 licenses. He said he hoped the city would note the differences between them as it mulls regulations.

“Type 42s can move around. And they have moved around,” said Sacket. On the other hand, “I’ve never had an issue with Type 02s.”

Even as he called for city oversight of Type 42 license-holders, Sackett emphasized that they’re not all bad. He even held up one local wine bar operator as a paragon of wine-pouring virtue: Jayme Powers, owner of Sigh, a champagne bar on East Napa Street.

“I believe I am the only Type 42 on the Plaza,” Powers said Monday night, adding that “tourists don’t always see the difference.”

Because of her Type 42 license, Powers’ business is considered a bar, meaning it can sell any brand of wine or beer, by the glass. Only people 21 and over are allowed inside, and Powers noted that, “We are liable if we serve to a minor.”

Tasting rooms allow people of any age inside (although only those 21 or over can drink). And they can offer only wines produced by that particular vintner, and serve only 1.5-ounce pours, not full glasses.

When the public comments were concluded, city leaders again discussed the many-faceted issue among themselves. Much seemed to depend on how the city chooses to wield its use permit authority – the process by which certain owners could be required to get their businesses approved.

To open a full bar, for example, a business owner must first obtain licensing through ABC, then go through an application process with the city Planning Department. Finally, nearby property owners are notified and a Planning Commission meeting is held to approve, or deny, the use permit.

Tasting rooms currently don’t have to go through that process – but they could, should the city decide to change its rules.

Under rules proposed by the Planning Commission, so-called extended tasting rooms “would require a use permit. Which is not the end of the world,” said Barbose.

But he went further, saying, “I would like to consider a conditional use permit for any tasting room … above the existing ones that we now have.”

Under that idea, use permits would become required after a “numeric cap” is reached. “Let’s say we set 25. Any tasting rooms beyond the 25th one would require a conditional use permit. To me that’s not onerous, it’s not an attack on our local purveyors. … But that doesn’t mean that we need 50 (tasting rooms) on the Plaza.”

The majority of city leaders rejected the idea of a cap on tasting rooms. “I don’t think there was a lot of will within the Planning Commission to try to institute a cap,” said commission chair Chip Roberson early on.

Later in the meeting, Councilmember Ken Brown said flatly that, “I would no more put a cap tonight on woman’s clothing stores” than he would on tasting rooms.

But that element aside, council members seemed open to possibilities, and wanted to learn more. Rouse, for one, admitted that, “My position, I think, has changed a bit.”

“I have never been a big proponent of regulation,” he said. But based on some of the things he heard Monday, “I could go with a use permit” in some cases.

No action was taken Monday, although the council directed city staff to give them more information and options on permitted use requirements for a subset of tasting rooms, as previously recommended by the Planning Commission.

The issue could again come before the City Council as early as March.

  • Fred Allebach

    One thing about wine alley: stores were vacant not necessarily because of lack of success but because the landlord raised the rents and would not consider any negotiation. Current tenants I spoke with said as much, you pay, period.

    The assertion that “Before we started Wine Alley, there was nothing there. There were no shops that could succeed” is not entirely true. Scandinavian Trends was a great store, a perfect example of variety, culture and diversity; they are gone not because they couldn’t succeed but because of rent jacked up too high, out of proportion to any inflation index. Free market then amounts to sophisticated highway robbery, you can’t pass until you pay what the highwaymen demand; it amounts to cornering a market, like an airport, and then charging as much as possible. When people look at this at face value, it just seems devoid of any humanity; the values are not admirable.

    • The Village Idiot

      Fred serves credit and probably a free security detail for pointing to the huge elephant in the room that is suffocating Sonoma: Downtown landlords.

      They charge whatever the market will bear, driving out small local entrepreneurs and mom & pop retailers in a free-market capitalist pursuit of maximum profits. They don’t care if space sits empty until some sap comes along to sucker; their ‘loss’ on empty
      space offsets exhorbitant profits made on the spaces they do rent to well-heeled tenants, thus lowering their overall tax bill.

      The result is that only corporate chains, wineries and idle-rich kitsch-shop dilettantes can afford the high rents. As the wine-tasting so-called study session affirmed, a tasting room is often a loss-leader for wineries because of the high rents and irregular foot traffic. But wineries (which you don’t own unless you have lots of cash) take the cost of the high rent as marketing expense for larger off-site production operations, also a deduction on their taxes.

      But for mom & pops and entrepreneurs who have to feed their families off the profits from their retail business, high downtown rents are job-killers.

      A real investigative newspaper interested in telling the whole story could easily call the county and find out who these landlords are and publish their names. But that might
      embarrass their cronies and advertisers. It’s not for nothing that people call it the Incest Tribune.

  • Larry Barnett

    When Melissa Dietert proposed her development, including the alleys, many in the community (and at least one present member of the Planning Commission, Mr. Edwards) strongly opposed the project and warned that the building was too big and that it created too many retail locations in hidden locations to be rented easily. This turned out to be entirely correct; poorly planned retail development is responsible for the turnover and vacancies in that alley, and it has taken years to find retailers, now loss-leader wine bars and tasting rooms, to fill them. It’s good they are rented, but blaming vacancies on city policy or use-permit issues is a specious argument. Landlords who charge what the market will bear and hold off renting until their price is met is more of a vacancy factor than anything else. Developers are speculators, and it is not the city’s responsibility to insure they make a profit or protect them from loss.