City Keeps Door Open for a Fast-Food Outlet : * Business: The council decides against forbidding food chains to build on a prime Village lot, saying the action would be illegal.

The City Council has backed away from banning fast-food restaurants from a city-owned lot in the Village area, saying that type of discrimination would be illegal.

After the question of possible uses for the vacant property came up during the summer, several residents and nearby business owners said they do not want a McDonald’s or Taco Bell-type outlet on the corner. The critics claim a fast-food restaurant could hurt the Village’s economy and quaint atmosphere.

But council members, acting as the Redevelopment Agency, on Tuesday took the advice of City Atty. Wynne Furth to not categorically exclude any business from the property for those reasons.

“Not that I’m in favor of fast food, but I don’t see how we can exclude it,” Councilman Algird G. Leiga said.

The 33,000-square-foot lot is at the corner of Indian Hill Boulevard and Bonita Avenue, which some consider a gateway to the Village’s downtown shopping area.

“That corner is a jewel of a corner,” said Jess Johannsen, whose wife owns an optometry business next door. He said they already have problems with trash accumulating on the lot.

“We would cheapen it (the property) by putting in a fast-food restaurant,” Johannsen said.

Resident Paul Jaeckel handed the council petitions with more than 2,000 signatures of residents opposed to a national or regional restaurant chain at the corner.

“I think you owe it to the Village to show some concern for the people who’ve been here 10 or 20 years,” he said.

But some residents, including local high school and college students, argued that fast food is just what the Village needs.

“I have three small children. And I do need a fast-food restaurant,” said Susan Edwards, adding that she has to drive out of the city for such a convenience.

The issue first came up at the July 16 meeting, when council members--citing a lack of affordable restaurants for students and employees of Village businesses--asked the city staff to research whether a fast-food restaurant would be appropriate for the lot.

Residents and business owners were quick to react, believing that the initial inquiry indicated that such a facility might soon be a reality.

Council members pointed out that even if restaurant chains consider the site, stringent design requirements on architecture and signs, plus a city ordinance prohibiting drive-through facilities, could make locating there difficult.

However, there already is some interest. Rod Lucio, a real estate representative for McDonald’s Corp., told the council that the chain is considering the prospect of building on the lot.