Pioneering craft brewery Eagle Rock Brewery is heading into yet another public hearing next week in an effort to renew the city license that allows it to continue to operate.
While opening a brewery and tasting room anywhere in California requires extensive battles with red tape, the city of L.A. imposes additional scrutiny before a conditional use permit (or C.U.P.) is granted that allows the sale of alcohol.
Applicants must conduct costly surveys of nearby businesses and residences, send informational mailings to those parties, and then petition the zoning administration in a public hearing. The application fee alone is thousands of dollars, and the process can take months.
"This is the fourth time in five years that we are having a public hearing to talk about [the conditional use permit] and whether or not we can exist after five years of existing," says Eagle Rock Brewery founder Jeremy Raub of the Nov. 6 hearing.
And Eagle Rock is far from alone in this. "I love, and I am committed to L.A.," says Tony Yanow, owner of craft beer bars Tony's Darts Away and Mohawk Bend, and co-founder of Golden Road Brewery, "but it's a horribly hard place to open a small business."
At first, it did not look like things would be this hard. After Eagle Rock Brewery's first hearing with the zoning administration in 2008, the application was approved and it was granted a C.U.P. good for 10 years. Brewery owners Raub and Ting Su thought they were out of the woods.
But before the 30-day period for appeals was up, the owner of a neighboring building lodged a formal complaint. This set the bureaucratic machine back in motion and required another public hearing that resulted in the brewery's C.U.P. being limited to just five years and requiring another hearing in one year to evaluate the brewery's impact on the neighborhood.
"I feel like we started [the business] at a really unfortunate time," Su says. "We started up and [the city] didn't know what to do with us, so they vilified us. It's really frustrating because to this day, after being responsible business owners and doing everything that we can to better the community, we are still being villainized and still have to go in and plead our case."
Tony Arranaga, communications director for city Councilman Mitch O'Farrell's 13th District says, "[Councilmember O'Farrell] is in support of the brewery and has always tried to work with the brewery to help it establish its business. With that being said, the plan approval is part of the permit process that serves as a check-in for the city and the community to make sure that the business is operating within the terms and conditions of their C.U.P."
By the time the third hearing in less than two years was held, Eagle Rock Brewery had established itself as a leader of L.A.'s nascent craft beer community. And it had fans in its surrounding Glassell Park neighborhood.
Marge Piane of Glassell Park Neighborhood Council says, "Not only were they among the first to take a chance on locating in Glassell Park, but they have always been supportive of the community. Eagle Rock Brewery brought people to Glassell Park who had no idea this area had a name."
The brewery's fans turned up to the third public hearing en masse to show support. The citizen who initially raised objections didn't appear and city administrators ruled in favor of the brewery. It would be free from further permitting entanglements -- at least until the C.U.P. expired in four years.
Those four years have passed and the brewery is faced with another public hearing to extend their permit, and now the application fees have risen to nearly $8,000.
"It seems that [the city government] is creating all of this work for themselves by making good businesses go through over and over again," says an exasperated Su.
"For as many hours as it takes us to get all the applications ready and to jump through all the hoops and do all the back-bends and flips that the city wants us to do to make it happen, I'm sure there is a paper pusher somewhere in the city who's having to spend tremendous numbers of hours hashing through all of that."
Raub and Su's frustration is shared by many beer-business owners.
Yanow ran into similar bureaucratic roadblocks opening Mohawk Bend when a small group of Echo Park residents rallied to prevent the brewery and bar from opening in what had been a dilapidated theater on Sunset Boulevard. "[The C.U.P. process] is really arduous and it can be really disruptive to your business."
The regulations imposed by L.A.'s zoning and permitting laws are cited as a major reason that the hot-spots of craft brewing in the county are developing in the South Bay instead of within city limits. Ohana Brewing Company's production facility is near downtown Los Angeles, but its tasting room is in Alhambra. Owner Andrew Luthi says, "The application [in Los Angeles] is a lot more expensive than in Alhambra. We don't have a tasting room at our brewery partly for that reason."
Golden Road opened its production brewery within the city, and while Yanow says the C.U.P. process for that location wasn't particularly difficult, he has crossed the city of L.A. off the list of areas to open a planned brewpub. "We're not looking in L.A. anymore. It's too hard and there are too many risks when working within L.A."
While cities such as Torrance and Carson have streamlined the C.U.P. process -- or waived it all together -- to attract start-up craft breweries, the costs to petition Los Angeles keep going up. Eagle Rock Brewery has spent more than $20,000 in the last five years on application fees and the associated costs for its C.U.P.
The point is not lost on the city government, and Arranaga stressed that bringing small businesses to the city is a major goal for Councilman O'Farrell. "The council member is trying to make it easier for businesses to do business with the city of L.A.," he said.
As a specific reform to the C.U.P. process, Arranaga says, O'Farrell is also "exploring an idea with the city planning department that would possibly allow for operational inspections to take the place of plan approvals to review condition compliance for certain cases. This will save the business owner money and free up the city's staff to deal with new cases and bad operators."
"The best case scenario," says Su, "is that we can go into that public hearing, we can have unanimous support, and [have our C.U.P. approved] to continue what we've been doing for the past five years and ...not have to pay another $8,000 in another five years."