Santa Clara Valley wineries that have yet to navigate the “ungodly” labyrinth that is “permit land” could pay to host certain events such as concerts, cook-offs and other commercial shindigs.
However, newly proposed changes to winery rules would loosen up the current regime, according to Santa Clara County District 1 Supervisor Mike Wasserman.
Under current rules, winery owners are required to have a costly “use permit” to host any sort of commercial, industry or marketing event, Wasserman reminds.
“It may not be everything (the wineries) want,” he continued, but every one of these (recommendations) is less restrictive than what’s on the books right now, and anyone who portrays it the other way doesn’t understand what’s going on.”
The County Planning Commission examined 15 recommended changes to rules that regulate South County’s wine industry during a meeting earlier this month. They agreed – after tweaking a few things – on three of 15 proposed changes.
This includes:
• By right, wineries may host small commercial events with 100 guests or less, without being subject to costly fees or a discretionary review.
• Wineries may have up to 12 events with more than 100 people each per year, but must purchase a one-time “special use permit.” This begins at $2,133 but can increase depending on individual processing scenarios.
• Wineries that host more than 12 events annually, with more than 100 attendees each, must obtain a “use permit.” The one-time base fee begins at $14,732 but can “easily go up to” $100,000 depending on individual processing scenarios and associated requirements such as traffic and noise studies.
“I’ve been trying to reduce the amount of bureaucracy and red tape so these wineries can do things and have less costs and less restrictions,” explained Wasserman. “The only bone of contention is how less restrictive should it be.”
That’s where grape growers and the county don’t always see eye to eye.
Local winery owners who participated in the Wineries Working Group – a series of monthly meetings initiated by Wasserman in September 2011 to address county policies that regulate the 22 Santa Clara County wineries – say gathering allowances should be size-proportionate to winery acreage.
The WWG proposed figures of 100 guests for wineries less than five acres; 200 guests for wineries between five and 20 acres; and 300 guests for wineries larger than 20 acres (allowed “by right” without a permit).
“I certainly feel like we should have adopted a tiered approach that would have allowed for more people on a larger parcel,” said Jennifer Williams, executive director of the Santa Clara County Farm Bureau. “The thresholds (wine growers) set out are reasonable … they have the expertise to know what they can handle … I wish more credence had been given to those thresholds.’”
Jason Goelz, co-owner of Jason-Stephens Winery and Sarah’s Vineyard owner Tim Slater, who regularly host free concerts throughout the year at their wineries, agree.
Evenings of music and wine are great for brand building, networking and building emotional connections with customers, but it’s not worth the time, paperwork, money and “county run-around” associated with a use permit, Goelz and Slater say.
“One hundred people is not enough to break even on bothering to do anything in this area,” said Slater, listing overhead costs that include the band, cost of goods and staff payroll.
Last year, Goelz said he broke even after hosting 23 concerts that averaged 250 to 300 attendees. He is currently in the process of obtaining a use permit; a headache he describes as “really expensive and time consuming and confusing.”
County staff point out that a “by right” figure of 100 attendees for small events falls in line with comparable counties such as San Luis Obispo (49 attendees), El Dorado, (49), Santa Barbara (79) and Amador (125). The county is also wary of large, un-permitted events that could trigger costly environmental impact reviews, said Wasserman.
At the end of the day, taming the “draconian” county permitting process is the overarching milestone growers unanimously pine for.
Kirigin Cellars owner Dhruv Khanna, who spent “$300,000 on the permit process alone” to get his winery on Watsonville Road up to code, said his children are no longer allowed to use the word “permit” around him.
It’s not that winegrowers are opposed to making sure their facilities are fit for public use; “it’s just that permit land is a swamp,” said Khanna.
Sycamore Creek Vineyards owner Bill Holt, similarly, has on occasion referred to the permitting process as an “outrageously expensive” undertaking that demands an “ungodly amount of time.”
While the minimum application fee for a use permit currently begins at $14,732, “in reality, it’s quite a bit more than that,” added Williams, citing examples of required noise, traffic and sometimes biological surveys. “A ball park figure is $100,000, and it can easily cost more.”
She said the county is in “cost recovery mode,” meaning permit applicants get charged for any extra work associated with the application process.
Alternately, one proposal suggests that wineries wanting to host up to 12 events annually with more than 100 attendees each may forego the “use permit” process by purchasing a one-time, $2,133 “special permit.” Still, that fee can easily increase depending on individual processing scenarios, Williams observed.
“The use permit process is so onerous,” she explained. “That’s what’s really driving a lot of these discussions. These aren’t business owners trying to get out of costs. They’re trying to get out of unreasonable costs and a multi-year permit process.”
After nine months of WWG meetings, the endeavor has imparted a favorable aftertaste for some – and notes of bitterness for others.
Slater characterizes the meetings as “another disappointment. It would be much better if (the county) did nothing,” he argued.
Dan Martin, who co-owns Martin Ranch Winery on Redwood Retreat Road, said overall the effort to update and clarify winery regulations has been “very positive.”
Martin agrees with Wasserman that the suggested “by right” (no permit needed) allowance of 100 guests for small commercial events is better than zero.
“But it doesn’t go as far as some of the other wineries had hoped,” he added. “It’s a very conservative approach from the county.”
Ultimately, what needs to be kept in mind is the original premise of the WWG, reminded Martin, “which was to increase agritourism.”
County staff has met monthly with local winery owners since September 2010 to review, clarify and draft updates to rules that regulate the wine industry. These are some of the items being studied prior to review by the Board of Supervisors in late May:
– Small, medium and large events: Could be dictated by how often they occur, how many people attend and what type of permit the winery operator holds.
– Outdoor amplified music: Wineries want to abide by the existing decibel limitations; Planning Office recommends wineries be subject to a discretionary special permit or use permit.
– Industry/marketing events (i.e., Passport Weekend): Planning Office recommends 12 events allowed annually by right without subjecting wineries to permitting requirements.
– Private events (i.e., fundraisers; gatherings for wine club members only): Wineries and Planning Office agree these should not be regulated.
– On-site/off-site signage: Wineries have asked for a maximum eight signs and up to 384 square feet of cumulative sign area. Planning Office recommends six signs and up to 128 square feet of cumulative sign area; additional signage requires a one-time $1,594 fee.
– County is also studying rules concerning bed and breakfast facilities, agricultural employee housing and RV tourist accommodations.
