OFFICE OF THE CITY ATTORNEY ROCKARD J. DELGADILLO CITY ATTORNEY REPORT RE:

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1 REPORT NO. R ,.llm! 3. OFFICE OF THE CITY ATTORNEY ROCKARD J. DELGADILLO CITY ATTORNEY REPORT RE: LLOYD HONG AKA GIL A. HONG, DBA LA MEXICANA MARKET V. CITY OF LOS ANGELES (LOS ANGELES SUPERIOR COURT CASE NO. BS ) Room 395, City Hall 200 North Spring Street Los Angeles, California Honorable Members: Case No. ZA (CUB) Council File No This case concerns a challenge to the City's decision to deny Lloyd Hong aka Gil A. Hong's application for a determination of Public Convenience or Necessity to sell beer and wine for off-site consumption at La Mexicana Market, an existing grocery market located at 4800 Compton Avenue. Mr. Hong sought a Writ of Mandate commanding the City to vacate its decision to deny Mr. Hong's Application For A Determination of Public Convenience or Necessity and to issue a letter of Public Convenience or Necessity. The Los Angeles Superior Court granted the Petition for Writ of Mandate filed on behalf of La Mexicana Market on June 6, The judgment directed the Council to clarify the City's finding of April 26, 2005, that the Public Convenience or Necessity will not be served by the proposed sale of alcohol for off-site consumption, in accordance with the court's ruling. The City is required to file a Return to the Writ by July 6, 2006, informing the Court of the City's intent to appeal the judgment or that the City has complied with the Writ. For the reasons stated below, by July 5, 2006, the last meeting of the Council prior to the Return deadline, the Council must decide whether to appeal the judgment or to comply with that judgment. This Office recommends that the judgment not be AN EQUAL EMPLOYMENT OPPORTUNITY- AFFIRMATIVE ACTION EMPLOYER 200 NORTH MAIN STREET LOS ANGELES, CA TOO OQ. Recydable and made ~om recycled waste. \6~

2 I' Page 2 appealed, and that the City comply with the judgment by clarifying its April 26, 2005, finding in accordance with the Court's decision. Background Administrative Conditional Use Proceedings La Mexicana Market is adjacent to a residential neighborhood in South Los Angeles. Mr. Hong is the owner and operator of La Mexicana Market. Mr. Hong currently sells fresh meats and produce and has operated this community grocery store for seventeen years. Mr. Hong's customers requested that he sell beer and wine at the grocery store because they wanted to buy in one place and because there are no supermarkets in the area. There is, however, an existing liquor store two blocks south of La Mexicana Market (i.e. within 600 feet.) Pursuant to state law and the City's Municipal Code, in order to sell beer and wine at the grocery store, Mr. Hong was required to go through two separate and distinct proceedings: 1) apply to the Department of City Planning for a conditional use permit ("CUP"); and 2) apply to the City Council for a determination of public convenience or necessity. In 2004, Mr. Hong applied to the City's Department of City Planning for a CUP to allow the sale of beer and wine for off-site consumption in his existing grocery store seven days a week between the hours of 8:00a.m. to 8:00p.m. A CUP is required because the sale of alcohol is not permitted by right in this particular zone. The City's Zoning Administrator ("ZA") conducted a public hearing and approved the CUP pursuant to Los Angeles Municipal Code ("L.A.M.C.") Section The ZA imposed twenty operating conditions and a five year term. As Mr. Hong was expressly advised, approval of a CUP by the ZA does not guarantee or mandate a finding of "public convenience or necessity" by the City Council. The ZA's determination was not appealed and, therefore, not reviewed by the City Council. Administrative Public Convenience Or Necessity Proceedings The City Council considered the sale of alcohol at La Mexicana Market in conjunction with Mr. Hong's Application for Determination of Public Convenience or Necessity in The Council, although not required to, held three separate public hearings on March 29, 2005, April 19, 2005 and April 26, The Council determined that "the public convenience or necessity will not be served by the proposed sale of alcohol for off-site consumption at 4800 Compton Avenue, La Mexicana Market (grocery market), inasmuch as the proposed site is within a census tract with an undue concentration of alcoholic beverage sales licenses." (Emphasis added.)

3 '- Page 3 Court Proceedings A Petition for Writ of Mandate was filed on behalf of Mr. Hong and La Mexicana Market on July 19, The Petitioner challenged the City's denial of his Application for Determination of Public Convenience or Necessity and the City's finding on the ground that the finding is not supported by the evidence alleging there is no undue concentration of liquor licenses in the census tract where the market is located. The trial court granted the Petition in part and entered judgment on June 6, The judgment does not require the City to set aside its decision of April 26, 2005, to deny Mr. Hong's application. The judgment instead directs the City to clarify its finding that the public convenience or necessity will not be served. Clarification is necessary because the City denied the Application on the ground that "the proposed site is within a census tract with an undue concentration of alcoholic beverage sales licenses." The Court found that, as worded, the finding is not supported by evidence in the record. Evidence in the record establishes four licenses are permitted in this census tract but only one license has been issued by the State Department of Alcoholic Beverage Control. The Court stated, however, that "there is substantial evidence [in the record] to support the right finding, if it's properly made... " The Court said "[i]t is undisputed, and the record shows, that the Market is in a high crime area, but in a census tract which has only one off-site liquor, when four are permitted." The Court concluded "[a] reasonable reading of the [City's] finding, supported by substantial evidence in the record, however, is that the Market is within a census tract which has an undue concentration of alcoholic beverage licenses because of the fact that it is in a high crime area, not because it has too many alcohol licenses." Recommendation This Office recommends that the judgment not be appealed, and that the City comply with the judgment by clarifying its April 26, 2005, finding to state a proper basis supported by the evidence in the record, affirm its decision to deny the application and instruct the City Clerk to transmit this determination to the State Department of Alcoholic Beverage Control as the required finding under California's Business and Professions Code Section relating to high crime districts. A copy of a draft motion to clarify the finding is attached as Exhibit A

4 Page 4 If you have any questions, please contact Deputy City Attorney Arletta Maria Brimsey at (213) Either she or another member of this Office will be available when you consider this matter to answer any questions you may have. Sincerely, ROCKARD J. DELGADILLO, City Attorney By ~RLETTA MARIA BRIMSE Deputy City Attorney AMB:gl:(2ao2oa) Transmittal

5 Motion I HEREBY MOVE that the Council ADOPT the recommendations of the City Attorney in the Case entitled Lloyd Hong aka Gil A. Hong. dba La Mexicana Market vs. City of Los Angeles. Los Angeles Superior Court Case No. BS098150, as follows: (Doc. No.: /dataset 02) ADOPT THE RECOMMENDATION OF THE CITY ATTORNEY to comply with the June 6, 2006, judgment ("Judgment") of the Los Angeles Superior Court in the action entitled Lloyd Hong aka Gil A. Hong. dba La Mexicana Market vs. City of Los Angeles. Los Angeles Superior Court Case No. BS , The judgment granted, in part, the Petition for Writ of Mandate filed on behalf of Lloyd Hong known as Gil A. Hong and doing business as La Mexicana Market and requires the City to clarify its finding of April 26, 2005 that the Public Convenience or Necessity will not be served. PRESENTED BY: SECONDEDBY:

6 Motion I HEREBY MOVE that the Council in the matter of (Council File No.) CLARIFY its finding that the Public Convenience or Necessity will not be served by the proposed sale of alcohol for off-site consumption at 4800 Compton Avenue, La Mexicana Market (grocery market), inasmuch as the proposed site is located in a high crime area within the meaning of California's Business and Professions Code Section (a)(1 ). Section (a)(1) provides "'undue concentration' means... [the] premises for [a]... license are located... in a crime reporting district that has a 20 percent greater number of reported crimes, as defined in subdivision (c), than the average number of reported crimes as determined from all crime reporting districts within the jurisdiction of the local law enforcement agency." The evidence in the record of the administrative proceedings which supports the clarified finding is as follows: i. The Los Angeles Police Department ("LAPD") expressed concerns regarding the rise of the crime rate due to the issuance of the requested liquor license, (AR 96, , ) and if a license were to issue requested that numerous conditions be imposed for public safety. (AR , ) ii. La Mexicana Market is located in a high crime area. (AR 101' 145, , 211.) iii. There is already an existing off-site liquor license within 600 feet of La Mexicana Market, approximately 2 blocks south, where the community can obtain alcohol. (AR 101.) iv. La Mexicana Market or the proposed site is in close proximity to sensitive uses, including numerous churches, schools, and parks. (AR , 219, ) v. The City's environmental impact study found potentially significant environmental impacts from beer and wine signage unless mitigation is incorporated. (AR 57.) These impacts, unless mitigated, will substantially degrade the existing visual character or quality of the site and its surroundings. (AR 48.)

7 vi. Existing land use tools are ineffective to abate negative impacts caused by alcohol sales in the community. (AR 234, 239.) vii. The proposed site is located in a Specific Plan or Community Redevelopment Agency Project area which specifically includes a policy to control future alcoholic beverage sales. (AR 160.) viii. The negative impacts associated with alcohol sales are cumulative and do not affect just the immediate area. (AR 246.) The impacts' affect on the entire community and the negative problems that liquor sales bring outweigh benefit, if any, to the community and to Mr. Hong. (AR ) (Doc. No.: /dataset 02) PRESENTED BY: SECONDED BY: