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New Entertainment Fees Threaten Coffeehouse Venues

Posted on 13 September 2011 by John Rippo

On July 1, San Diego enacted a new series of fees for entertainment permits that will have serious effects on coffeehouses and entertainers of all kinds who depend on café venues for their living. Increases of over 700 percent for yearly entertainment permits is likely for some cafés and the chilling effect of high fees are likely to cut the number of coffeehouses that can afford to host musicians and profit from entertainment.

The new fees are part of a package that was voted unanimously by the SD City Council on June 23. The new package raised fees for many other permits and city services, including building permits, inspections and medical helicopter flights. Also included in the scheme to collect some $774,000 annually is a new way to fund the SDPD Vice Squad, which oversees issuance of entartainment permits to all venues, including coffeehouses.

The City claims that in tight economic times, “cost recovery” of services rendered to businesses regulated by Vice is necessary and that means that regulated venues have to pay for the Vice Squad that does the regulating. Though the City insists that previous fee structures only collected some 26% of costs, where the Vice Squad is concerned, the numbers are unknown. Vice does not make its budget public as of June 23, 2011—the day the vote came in at City Hall. The Vice Squad determines its own budget, unburdened by any oversight—and charges regulated businesses accordingly. So far, there has been no challenge to this from of cost recovery and SDPD has resolutely refused to comment on what Vice’s budget amounts to.

This will have significant and perhaps grave meaning for the businesses that face sharply increased costs. Entertainers will be affected too.

For example, the new fee structures for cafés, restaurants and clubs will see a rise in yearly permit fees from last year’s $379 to this year’s $2,383—for a place with a 100-person maximum occupancy that sells alcohol. Depending on the occupancy rate, alcohol sales and history of police calls, a place like that described could face yearly costs of nearly $4000 per year for a permit to keep entertainment going.

Smaller cafés will pay less—from the current $184 annually for a place that seats 50 or more without alcohol or dancing, to a new rate which will be $288. Places that seat fewer than 49 persons without alcohol or dancing used to pay $126; they will pay $230 this year. For cafés with alcohol and dancing, the costs will skyrocket—to $1840 for more than fifty seats and alcohol where dancing may be allowed; and to $920 for under 49 persons with alcohol and dancing.

In addition to that, many small venues will be forced—as a condition of maintaining their entertainment permit—to reconfigure their structures to the same standards as nightclubs use now. This means double doors on exits, panic bars to open those double doors, at least two restrooms and one security guard for every 25 guests. Last year, the rate was a single guard for every 75 guests. For most coffeehouses that were never built to this “nightclub” standard and whose levels of entertainment income do not allow them to afford the muscle at the doors, this will likely mean that the curtain falls on entertainment permanently.

As if that weren’t enough of a blow, new rules will force all businesses offering entertainment to stop while they reapply for entertainment permits from year to year. In effect, each business will face an entertainment moratorium for an inderterminate time on what is for some, a primary profit center. “You couldn’t ask for a better way to hurt our business,” lamented one Mission Valley coffeehouse owner. “It’s like they have a handle on the faucet and can turn off your profits as long as they want from one year to the next.”

For some, the new fees are Deja Vu all over again.

That’s because in 2000, the City tried to pass similar laws that would have made coffeehouses and other small venues 21 and up only, if they offered entertainment of any kind. The building upgrade language in the new law was there in the 2000 legislation and then, SD City Attorney and Vice publicly stated that “entertainment equals crime” since all venues served as conduits for drug and gang activity, in their opinion. The proposed law was skewered by media and hotly contested by many of San Diego’s entertainers, coffee people and others concerned that it would cripple the growth of local culture, hurt business and interfere with redevelopment in some areas.. After two hearings by the full City Council, the law was amended. Now, the baser portions of the 2000 law are back and hailed as a cost cutting measure.

Councilmembers De Maio and Zapf opposed the rate hikes until the final vote when they voted for the measure which was originally championed by Kevin Faulconer as a strong “law and order” message coupled with saving City money.

At first glance, a yearly fee of $920 does not seem to amount to much; but when coupled with high costs of hiring security guards and new construction demands, the total cost to maintain code compliance becomes unaffordable for many small venues.. As one café owner put it, “The day they do that to me, I’ll just throw parties after hours in the street. That will cost them plenty and get me no end of great press…”

The ones most affected by any change in fees will of course be musicians and other entertainers robbed of places to play. Until now, coffeehouses in particular have reported a surge in numbers from entertainment of all kinds and more venues means more money and public support for the next Jewel, Tom Waits, Blink 182, Jim Morrison and Novamenco that first got started in the San Diego coffeehouse scene. Coffeehouses outside San Diego city limits may benefit from the blockade of culture forced by the PD; and at least one La Mesa café reports that it is aggressively seeking new bookings from bands and singers forced out from San Diego cafés.

Some in the hospitality industry point fingers at the California Restaurant Association, a trade group that has long regarded “non-standard” venues as a direct threat to its members’ bottom line, for promoting the new rules.. Like the 2000 effort before it, the new rules were allegedly promoted with urging from that organization. Cal Restaurant did not respond to ESPRESSO’s questions on the matter by press time.

Others in hospitality say that the City has it all wrong when it comes to jacking fees for small venues like coffeehouses. The San Diego Food & Beverage Association has been quietly lobbying the city for a more enlightened form of permit structure that would take types of entertainment into account for purposes of regulation and also factor in occupancy and previous history. Until the budget plan was proposed by Vice, some progress had been made toward setting maximum sizes of stage and numbers of musicians with unamplified music in small venues. The current mantra of “cost recovery” coupled with dodgy Vice budgets killed that plan.


Though it may surprise some, San Diego’s Finest have long worked to undermine the growth and divergence of the coffeehouses when it came to expanding into entertainment of any kind. That’s because for the last fifty years, many in city government and the PD have looked at coffeehouses as problems in regulation and undesirable social action waiting to happen. Ever since the 1960’s, coffeehouses in the city faced opposition when they ventured out beyond the sale of coffee and into entertainment—or what some regarded as activism. Whether serving as hangouts for anti-war youth in 1968 at the once famed Blue Whale or Upper Cellar, to the stirrings of gay activism in the 70’s at The Study, to the café-cum-nightclub antics of Java Joe’s in Ocean Beach in the 90’s or to more prolix activism at Chicano Perk, the seven-year run of which was ended suddenly last year by the City for alleged zoning violations—two weeks after lectures on Socialism were offered to area youth at the coffeehouse—to the pols and cops, coffeehouses have been the square peg defying the round hole where regulation is concerned. The cops and presumably City Attorney Jan Goldsmith would like to see them limited solely to selling coffee. The coffeehouses realize that especially as times tighten, entertainment is crucial to their ability to grow. Entertainers of all kinds have used cafés to start careers, build new acts and develop their talent.

SDPD has long stated that its manpower and money resources are low and their pro-active stance toward anything that may cause a problem too hard to control means suppressing trouble before it starts. Where entertainment is concerned, it means tightly controlling how venues can operate and to some extent, what kinds of entertainment they can offer. For a half century, coffeehouses have been a traditional wild card for the PD; Vice wants to regulate them the same as bars, clubs or concert halls and calls from business owners who point out that the kinds of trouble often found in other establishments is virtually non-existent in them fall on deaf ears. Now, Vice needs to make its budget from regulated businesses entirely and this hardens their stance when negotiating with business groups for breathing room. The net result is that coffeehouse venues are threatened, the PD is enriched and entertainment—and chances for an organic, homegrown culture to arise in the cafés suffers.

The uphill battle for any change in fees is with Vice to overcome their insistence that a having a good time is likley a crime—no matter if it’s had at Lestat’s, Anthology, HOB or at the San Diego Symphony Hall. Whether that can happen now is anyone’s guess and hospitality insiders offer long odds on change. As one hospitality insider put it, “There’s no way this thing is going away. Not now.” Still, change occurred last time, in 2000 when hundreds of maddened entertainers and others threatened by entertainment permit concerns flooded the PD with publich protests and crammed City Hall twice with hundreds more people demanding change. Last time, the cafés in San Diego were lucky and found some friends in City Hall at a crucial time. Whether that will happen again without organization between the coffee tradespeople and entertainment intresests is perhaps unlikely.


4 Comments For This Post

  1. ed decker Says:

    There are no words

  2. James Call Says:

    San Diego steps on it’s own toes in it’s continuing hamfisted interference with the free development of culture and entertainment in this town. The contentment and happiness of the people aside (which is where it appears to be in our city councils), a vibrant culture however is a boon to the promotion of tourism and convention business, which the city states are at the forefront of their goals.

  3. Brandon Says:

    Well, here is another San Diego mess up to satire.

  4. Robert Says:

    As a musician, when I play in the San Diego area I can expect to make the bare minimum for my efforts. I have been playing music for 42 years. My band has won national awards for it’s music. For a two hour gig at a very popoular North Park coffeehouse we would be fortunate to pull in $40.00 per man (four-piece ensemble). This is both insulting and deflating to any self-respecting artist. This is just so much more salt in our wounds.

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