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2. Ordinance 1722 - Zoning Text Amendment - DewGood, LLC - 1st ReadingREPORT TO: Doug Russell, City Manager V FROM: PJ Sorensen, Kalispell Planning Dept SUBJECT KZTA13-01 — Zoning Text Amendment - Accessory casinos MEETING DATE: March 4, 2013 BACKGROUND: The Kalispell City Planning Board met on February 12, 2013, and held a public hearing to consider a request by Dewgood, LLC, to amend Section 27.34.040 of the Kalispell Zoning Ordinance as it relates to the maximum percentage of floor area allowed for casinos as an accessory use. The proposal would increase the percentage from 10% to 20%. The changes to the current text of the code section are indicated below. Deletions are struck -out and additions are underlined. 27.34.040: Casinos (1) Casinos shall be a minimum of 300 feet from churches, schools, parks, city residential zones, and other casinos, measured from property line to property line. (2) Casinos may be located closer than 300 feet from churches, schools, parks, city residential zones, and other casinos, measured from property line to property line if the casino is considered a minor accessory use and meets the parameters of both Sections 3 & 4 below. (3) A casino is considered a minor accessory use to a primary use if the primary use (e.g. restaurant or bar, but not shopping center or other multi -use designation) and its associated facilities constitute at least 980% of the proposed floor space and the casino constitutes no more than 4-20% of the proposed use. In addition, the casino is generally shielded or screened from view of the primary use and patrons. (4) The following design standards as appropriate may be placed on the casino: (a) Limiting or prohibiting the on -premise signage or building from using the following: 1. Any terms such as gaming, gambling, cards, dice, chance, etc. 2. Any reference to any associated activity or any symbols or words commonly associated with gaining. 3. Any words, terms, figures, art work, or features intended or designed to attract attention to the fact that a casino is on site. 4. Neon Lighting. (b) Limiting the number and location of entrances into the casino. (c) Increasing landscaping requirements in order to create a buffer between the casino and adjacent land uses. About 12 years ago, the zoning ordinance listed casinos as a conditionally permitted use in the primary commercial zones. The definition of "casino' was somewhat lengthy and convoluted, but generally, anything with more than one card table, 15 or more machines, or with the word "casino' in the name or signage, was considered a casino. The City Council, at the time, was concerned about the proliferation of casinos in the city and looked at various options to minimize their impact in the community. The resulting regulations redefined "casino' as any form of legalized gambling (with a few exceptions) and required them to be spaced out by having a 300 foot buffer requirement from churches, schools, parks, city residential zones, and other casinos. These changes significantly limited the options for any new business wishing to offer any form of gaming, including many types of restaurants that wanted to operate with a liquor license. The connection with the liquor license is that the State of Montana issues a specified number of liquor licenses within a community through a rather complex fonnula. When a city, such as Kalispell, is at the maximum, a new business needs to purchase the license from an existing business. The limited supply of the licenses creates a market where the licenses become very expensive to obtain. Coupled with the general requirement that casino gaming licenses must be connected to a liquor license, many restaurants are faced with a choice of not offering liquor or providing gaming as a way to pay for the cost of the liquor license. The Council recognized the dilemma faced by new restaurants and in 2006 amended the code to allow for situations where accessory casinos are an option (i.e. where the primary use is a restaurant or bar, but where a limited amount of area, separated from the main part of the facility could be used for gaming). The specifics of the amended provision are our current rule as outlined above. The focus of this proposal is the limitation of the casino area to no more than 10% of the floor space for the proposed use. When working with the applicant on their project, it became apparent that the rule needs another review for two principal reasons. First, in order to reasonably function, there needs to be a certain minimum amount of area for machines and tables to be placed and people to flow. While the 10% limit appears to allow that for larger restaurants, smaller restaurants, especially those trying to redevelop existing space downtown, may not be able to generate enough casino area to properly function. Second, since the 2006 amendment was written, the typical types/dimensions of machines has changed. Previously, machines were generally 17 inches wide. Newer machines are generally 28 inches wide or wider, which means that more area is typically needed today to allow the same level of function that the ordinance contemplates. Please note that in Montana, a casino cannot operate more than 20 video machines. The proposal would not change any of the standards requiring screening or limitations on signage, neon lighting, and number of entrances. It is simply trying to get the existing rules to work more equitably for smaller restaurants. No one spoke at the public hearing regarding the amendment, although one written comment was submitted and provided to the Planning Board at the hearing. The proposal was forwarded to the Council with a positive recommendation on a 4-1 vote. RECOMMENDATION: A motion to approve the requested amendment. FISCAL EFFECTS: Approval of the request would have minimal fiscal effect to the City. ALTERNATIVES: Deny the request, which would maintain the current maximum floor area for an accessory casino at 10%. Respectfully submitted, PJ Sorensen Kalispell Planning Dept Report compiled: February 25, 2013 c: Theresa White, Kalispell City Clerk c: DewGood, LLC, P.O. Box 10007, Kalispell, MT 59904 [Q 9 13 11z AN ORDINANCE AMENDING THE KALISPELL ZONING ORDINANCE (ORDINANCE NO. 1677), BY AMENDING SECTION 27.34.040, CASINOS, AND DECLARING AN EFFECTIVE DATE. WHEREAS, DewGood, LLC has submitted a written request to amend the Kalispell Zoning Ordinance, by amending the maximum percentage of floor area allowed for casinos as an minor accessory use; and WHEREAS, the request was forwarded to the Kalispell City Planning Board and Zoning Z) Commission by the Kalispell Planning Department after having been evaluated under 27.29.020, Kalispell Zoning Ordinance; and WHEREAS, the Kalispell City Planning Board and Zoning Commission recommended that the text of the Kalispell Zoning Ordinance be amended so as to allow the maximum percentage of floor area for a casino to be twenty percent (20%) of another primary use; and WHEREAS, the City Council has reviewed the KPD Report and the transmittal from the Kalispell City Planning Board and Zoning Commission and hereby adopts the findings made in Report #KZTA- 13 -01 as the Findings of Fact applicable to this Ordinance. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF KALISPELL AS FOLLOWS: SECTION I. The City of Kalispell Zoning Ordinance, Ordinance No. 1677, is hereby amended as follows on Exhibit "A". SECTION 11. All parts and portions of Ordinance No. 1677 not amended hereby remain unchanged. SECTION 111. This Ordinance shall take effect thirty (30) days after its final passage. 1FT'12JE CITY OF KALISPELL THIS 18TH DAY OF MARCH, 2013. Tanuni Fisher ATTEST: Mayor Theresa White City Clerk EXHIBIT 44A59 27.34.040: Casinos (1) Casinos shall be a minimum of 300 feet from churches, schools, parks, city residential zones, and other casinos, measured from property line to property line. (2) Casinos may be located closer than 300 feet from churches, schools, parks, city residential zones, and other casinos, measured from property line to property line if the casino is considered a minor accessory use and meets the parameters of both Sections 3 & 4 below. (3) A casino is considered a minor accessory use to a primary use if the primary use (e.g. restaurant or bar, but not shopping center or other multi -use designation) and its associated facilities constitute at least 980% of the proposed floor space and the casino constitutes no more than -120% of the proposed use. In addition, the casino is generally shielded or screened from view of the primary use and patrons. (4) The following design standards as appropriate may be placed on the casino: (a) Limiting or prohibiting the on -premise signage or building from using the following: 1. Any terms such as gaming, gambling, cards, dice, chance, etc. 2. Any reference to any associated activity or any symbols or words commonly associated with gaming. 3. Any words, terms, figures, art work, or features intended or designed to attract attention to the fact that a casino is on site. 4. Neon Lighting. (b) Limiting the number and location of entrances into the casino. (c) Increasing landscaping requirements in order to create a buffer between the casino and adjacent land uses. CITY OF KALISPELL — ZONING REGULATIONS KALISPELL PLANNING DEPARTMENT STAFF REPORT #KZTA-13-1 FEBRUARY 12,2013 This is a report to the Kalispell City Planning Board and the Kalispell City Council regarding a request for a text amendment to Section 27.34.040 of the City of Kalispell Zoning Regulations. Currently, the ordinance limits the maximum percentage of floor area allowed for casinos as an accessory use (e.g. part of a bar or restaurant) when located within 300 feet of churches, schools, parks, city residential zones, and other casinos, to no more than ten percent. The request would increase the maximum percentage to twenty percent. A public hearing has been scheduled before the planning board for February 12, 2013, beginning at 7:00 PM in the Kalispell City Council Chambers. The planning board will forward a recommendation to the Kalispell City Council for final action. A. Petitioner: DewGood, LLC PO Box 10007 Kalispell, MT 59901 (406) 752-5411 B. Area Effected by the Proposed Changes: Any property within the jurisdictional boundaries of the City of Kalispell where casinos are allowed as a conditionally permitted use may be affected by the proposed changes. C. Proposed Amendment: The changes to the current text of the code section are *indicated below. Deletions are struck -out and additions are underlined. 27.34.040: Casinos (1) Casinos shall be a minfi-num of 300 feet from churches, schools, parks, city residential zones, and other casinos, measured from property line to property line. (2) Casinos may be located closer than 300 feet from churches, schools, parks, city residential zones, and other casinos, measured from property line to property line if the casino is considered a minor accessory use and meets the parameters of both Sections 3 & 4 below. (3) A casino is considered a minor accessory use to a primary use if the primary use (e.g. restaurant or bar, but not shopping center or other multi- use designation) and its associated facilities constitute at least 980% of the proposed floor space and the casino constitutes no more than 4-20% of the proposed use. In addition, the casino is generally shielded or screened from view of the primary use and _patrons. Page 1 of 4 (4) The following design standards as appropriate may be placed on the casino: (a) Limiting or prohibiting the on -premise signage or building from usitig the following: I. Any terms such as gaming, gambling, cards, dice, chance, etc. 2. Any reference to any associated activity or any symbols or words commonly associated with gaming. 3. Any words, terms, figures, art work, or features intended or designed to attract attention to the fact that a casino is on site. 4. Neon Lighting. (b) Limiting the number and location of entrances into the casino. (c) Increasing landscaping requirements in order to create a buffer between the casino and adjacent land uses. D. Staff Discussion: About 12 years ago, the zoning ordinance listed casinos as a conditionally permitted use in the primary commercial zones. The definition of "casino" was somewhat lengthy and convoluted, but generally, anything with more than one card table, 15 or more machines, or with the word "casino" in the name or signage, was considered a casino. The City Council, at the time, was concerned about the proliferation of casinos in the city and looked at various options to minimize their impact in the community. The resulting regulations redefined "casino" as any form of legalized gambling (with a few exceptions) and required them to be spaced out by having a 300 foot buffer requirement from churches, schools, parks, city residential zones, and other casinos. These changes significantly limited the options for any new business wishing to offer any form of gaming, including many types of restaurants that wanted to operate with a liquor license. The connection with the liquor license is that the State of Montana issues a specified number of liquor licenses within a community through a rather complex formula. When a city, such as Kalispell, is at the maximum, a new business needs to purchase the license from an existing business. The limited supply of the licenses creates a market where the licenses become very expensive to obtain. Coupled with the general requirement that casino gaming licenses must be connected to a liquor license, many restaurants are faced with a choice of not offering liquor or providing gaming as a way to pay for the cost of the liquor license. The Council recognized the dilemma faced by new restaurants and in 2006 amended the code to allow for situations where accessory casinos are an option (i.e. where the primary use is a restaurant or bar, but where a limited amount of area, separated from the main part of the facility could be used for gaming). The specifics of the amended provision are our current rule as outlined above. Page 2 of 4 The focus of this proposal is the limitation of the casino area to no more than 10% of the floor space for the proposed use. When working with the applicant on their project, it became apparent that the rule needs another review for two principal reasons. First, in order to reasonably function, there needs to be a certain minimum amount of area for machines and tables to be placed and people to flow. While the 10% limit appears to allow that for larger restaurants, smaller restaurants, especially those trying to redevelop existing space downtown, may not be able to generate enough casino area to properly function. Second, since the 2006 amendment was written, the typical types/dimensions of machines has changed. Previously, machines were generally 17 inches wide. Newer machines are generally 28 inches wide or wider, which means that more area is typically needed today to allow the same level of function that the ordinance contemplates. Please note that in Montana, a casino cannot operate more than 20 video machines. The proposal would not change any of the standards requiring screening or limitations on signage, neon lighting, and number of entrances. It is simply trying to get the existing rules to work more equitably for smaller restaurants. Alternatives: The most straight -forward approach is to have a flat change in the maximum percentage of area that can be used for casino purposes. A flat change is the least complex, easiest to understand, and arguably the fairest across the board. If, however, there is concern with 20% being too large an area for larger restaurants and bars, there are other possibilities which would limit the increase for those larger uses. The first alternative for consideration would be to increase the allowable area to 20% for the first 6000 square feet of overall area, and then step down the allowable area to an additional 10% for any square footage over 6000 square feet. A second alternative would be to increase the allowable area to 20%, but cap the maximum amount of casino area at 1200 square feet or some other reasonable number. The statutory basis for reviewing a change in zoning is set forth by 76-2-303, M.C.A. Findings of Fact for the zone change request are discussed relative to the itemized criteria described by 76-2- 304, M.C.A. Is the zoning regulation made in accordance with the growth polio The proposal is consistent with the goals and policies of the growth policy. The growth policy encourages a mix of uses that create and support a vibrant business community. It also seeks to provide incentives for the redevelopment of existing buildings, particularly in the downtown area. The additional flexibility proposed under this amendment would open up the ability to redevelop smaller existing spaces into restaurants/bars with minor accessory gaming areas. 2. Does the zoning regulation consider the effect on motorized and nonmotorized transportation systems? The proposed amendment would have a minimal effect on transportation systems. Page 3 of 4 Is the zoning regulation designed to secure safety from fire and other dangers? The proposed amendment would have little impact. General city codes such as building, fire, and zoning regulations, would address fire and other dangers. 4. Is the zoning regulation designed to promote public healtk public safety, and the general welfare? As with safety from fire and other dangers, the general health, safety, and welfare of the public will be promoted through general city regulations designed to regulate allowable uses when the use is developed or remodeled. 5. Does the zoning regulation consider the reasonable provision of adequate light and air? The proposal would have minimal impact on light and air. 6. Is the zoning; regulation designed to facilitate the adequate provision of transportation water, sewerage, schools, parks, and other public requirements? The proposal would have minimal impact on those services. Within the city, any use impacted by this amendment would likely be connected to existing city utilities and other services. 7. Does the zoning regulation consider the character of the district and its peculiar suitability for particular uses? The amendment would have its greatest impact in existing commercial areas. It would create a better opportunity for restaurants and bars to succeed by giving more flexibility for smaller operations with liquor licenses to provide limited gaming as an accessory use, while still maintaining the primary goals of the existing code section. This type of use fits squarely in the commercial zones where it is allowed and would help the vibrancy of those districts. 8. Does the zoning regulation consider conserving the value ofbuildings? Building values will be conserved by providing reasonable standards within zoning districts by encouraging predictable, orderly, and consistent development within the city. 9. Does the zoning regulation encourage the most appropriate use of land throughout the municipality? The amendment helps continue to ensure that casinos are developed appropriately in commercial areas. RECOMMENDATION Staff recommends that the Kalispell City Planning Board adopt the findings in staff report KZTA- 13-1 and recommend to the Kalispell City Council that the proposed amendment be adopted as --------- Page 4 of 4 Planning Department 201 1st Avenue East Kalispell, MT 59901 Phone: (406) 758-7940 Fax: (406) 758-7739 www.kalispell.com/planning PETITION FOR ZONING TEXT AMENDMENT NAME OF APPLICANT: 'Dr-w GaV P L MAILING ADDRESS: i ao x o c Co, 7 CITY/STATE/ZIP: �A-� SpE' I I IiY"GT'�tO PHONE: ~ICJ L •!9-4 1 f WHAT IS THE PROPOSED ZONING TEXT AMENDMENT? ?L-7 r3 4 , e4c� r-on 4nL ot"oi Ln oo. 1 Allow A VWVU>rP— UeS 5O i—Dr A CAS 1 o WHAT IS THE PURPOSE OR INTENT OF THE PROPOSED TEXT AMENDMENT? .d.ao t" 1�0 r) t2 �--) ► n � e., (. -Ogcr —T�4 l S c s-rz i3la. "((ire-yrr I S Q e S 16 MC) 'Sc.c^ *40 � �.A 5 � 3►..� w ►�"s�-3 cx.�� Yv�► vtio�"' HOW WILL THE PROPOSED CHANGE ACCOMPLISH THE INTENT AND PURPOSE OF: A. Promoting the Growth Policy �R� S �Q U Gt'i1 � n � �y bT� t zo► i��n c� �' �k.�?E�' tc f1J4OEM.L(2- V l OV5 tI) L- M @�-- NEW F f Q Inv► L�.4n1 OWF, B. j Lessening congestion in the streets and providing safe access F �1E �0..f /"�+iiw.� �,`�.Y�.� J,.1 S + _D -"e"� ��'ry yAC•����/'R�I C. Promoting safety from fire, panic and other dangers Cj It D. Promoting the public interest, health, comfort, convenience, safety and general welfare E. Preventing the overcrowding of land I-J0 au � L-.0 e\, L-a E' F. Avoiding undue concentr * n of population MW G. , Facilitating the adequate provision of transportation, water, sewage, schools, parks, and other public facilities NA -- NC:> *- LQ� t n6 co &ko-= H. Giving reasonable consideration to the character of the district pa$I - n4S P r©zecs-1 I. Giving consideration to the peculiar suitability of the property for paTtici4lar uses C R EA' D n "at I� ZKA.2 2 J. Protecting and conserving the value of buildings ° 0Y) �. .7► � to Lp a.P > «1 K. Encouraging the most appropriate use of land by assuring orderly growth 0 (Date) zc� i-:S 3