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Mayor London Breed and San Francisco officials are proposing legislation aimed at making it easier for small businesses to get up and running, building on changes voters passed in 2020 to cut through layers of city bureaucracy and to cut down on the commercial vacancies plaguing some districts.
The more than 100 proposed changes to the city’s planning code come at a time when some new business formations, particularly restaurants and bars, are on the rise in San Francisco, despite being well below pre pandemic averages.
The proposed legislation would allow more retail spaces to be used for multiple purposes, while shortening how long it takes to get the right permits for a new business.
It would also allow professional services in ground floor retail spaces, like an accountant’s office, which under the planning code are largely reserved for retail spaces. The proposal would also push supervisors to remove limits on bars and restaurants in some commercial strips.
“Our small business rules and regulations, which had been a challenge for many years, were made significantly worse during the global pandemic,” Breed in a statement. “Our system for permitting small businesses to open and operate was so broken that voters overwhelmingly supported a ballot measure to streamline regulations and support our small businesses. We have continued to make changes and improvements to the processes so that entrepreneurs can focus on serving their customers and building up a successful business.”
The changes are intended to build on 2020’s Proposition H, and the Small Business Recovery Act adopted by the board the same year which did away with public hearings and neighborhood notice requirements for some small businesses applications, lengthy processes which could lead to appeals by neighbors that tied up applications for weeks or months.
Asked what the city could do to make permitting easier for businesses overall, San Francisco Small Businesses Commissioner Cythia Huie said in an email it could help businesses understand what they need to do to navigate the bureaucracy, instead of “sending them cryptic feedback.” “Also, not allowing one neighbor to appeal a project and police what goes into a community,” she said.
Before Prop H passed, some small business hopefuls saw their dreams choked out by red tape, causing them to give up all together.
City officials said key to the proposed legislation would be making it easier for storefront businesses to benefit from flexible retail, like a combined plant store and coffee shop, without having to go back to the city to get new permits.
That would build on Executive Director of the Office of Small Businesses and former Supervisor Katy Tang’s legislation that allowed flexible retail in districts 1, 4, 5, 10 and 11.
That would make multi-use spaces, like Earl Shaddix’s Bayview Makers Kitchen South, which is slated to open in May, easier to get up and running. The current location of the maker space is already online, with businesses selling food and drinks as well as art and other local fare.
Shaddix said to get that location going he had to go through the longer conditional use permit process for each of those businesses, whereas if the proposed legislation passed they would be covered under the speedier flexible retail provisions.
Shaddix estimated that only about a tenth of the storefronts in the 3rd Street commercial corridor are vacant, compared to more than a quarter before the pandemic. Voters passed a commercial vacancy tax on landlords in November which is currently being challenged in the courts.
The city estimates that since Proposition H took effect in January 2021, 3,520 projects have benefited from it, allowing more commercial projects to be processed more quickly.
The city opened its permit center with limited construction service in August 2020, with business and special events services available as of July 2021. Ten city departments are located there, with city staff available to assist people and businesses.
As it stands, most flexible retail isn’t allowed at all in most parts of the city, according to Marianne Mazzucco Thompson of the San Francisco Office of Small Business.
That includes the stretch of Union Street where Teddy Kramer is planning to open his community space and shop, Neon, later this year. Kramer said he’s benefited from the city’s First Year Free program which he estimates will have saved him between $10,000 to $20,000 in permitting fees. And if the citywide flexible business provisions pass, it would make it easier for Kramer to evolve his neighborhood hub space, which he described as a “mom and pop FedEx/Kinkos” and workspace that gives away free coffee since he doesn’t have a permit to sell it.
If the legislation is adopted, commercial corridors across the city, including West Portal, Lower Polk, Upper Market, Glen Park and many others, would be allowed to host those spaces without going through the conditional use permit process.
The changes would also open up some commercial corridors to professional services, like an accountant or insurance broker’s office, that aren’t currently allowed in ground-level retail spaces.
And for neighborhoods like the Haight-Ashbury and parts of the Mission and the Bayview where there are caps on how many bars and restaurants are allowed, supervisors would be encouraged to re-evaluate those rules.
“That’s a program that needs to be expanded upon,” said Kristin Houk, who owns All Good Pizza as well as Tato and Cafe Alma in and around the Bayview’s 3rd Street corridor. “It gives the restaurants and the Bayview the opportunity they need.”
Sunny Powers, who owns the Love on Haight artists collective selling art, clothes and other goods, said as a resident and a business owner in the Upper Haight she wants to see the cap on restaurants allowed in the area lifted.
Current city law states that “A concentration of alcoholic beverage establishments in a neighborhood disrupts the desired mix of land uses that contribute to a livable neighborhood and discourages more desirable and needed commercial uses in the area.
“More businesses open means more lights, more activity,” she said, adding that it could also help with foot traffic for her business and others. We have a point that we die off in the day,” usually around six o’clock, Powers said.
Reach Chase DiFeliciantonio: chase.difeliciantonio@sfchronicle.com; Twitter: @ChaseDiFelice
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