San Francisco County Grand Jury • 1999-2000

Club Permits Report of the 1999-2000 San Francisco Civil Grand Jury Summary Many of San Francisco's dance clubs are

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Findings and Recommendations 2 findings

Recent police actions to suspend or revoke club permits are in part based upon incidents that are not fairly attributable to club management. The basic premises of the SFPD with respect to clubs that are negligently managed are: (1) the clubs constitute a "threat to the health, safety, and welfare of the community" by bringing in the wrong element (either patrons or persons who prey on patrons) to the city; (2) the clubs are a "repeated disruption to the neighborhood" and especially to residents who live nearby; and (3) the clubs are a constant "strain on police services" because police resources are expended to respond to complaints and calls related to the clubs. [7] The SFPD's present practice is to cite all incidents which they believe are related to a club as evidence of negligent management. So, when a club's security staff calls the police to arrest an unruly person trying to get into the club or the paramedics to assist a drunk and dehydrated dancer, these responsible acts on the part of club management are used by the police against the club at a later date. Even incidents which take place outside of a club's premises and over which club management has little or no control, such as car break-ins in alleys on nearby streets or "suspicious" persons hanging around the club's premises, are cited in the police complaints and permit hearings to suspend or revoke a club's permits. Anonymous third-party complaints about a club may also be used to institute permit suspension or revocation proceedings. Earlier this year, the Maritime Hall received notice that its permits were under threat of suspension based on 22 incidents alleged by the police to have occurred over the course of five years. The police complaint appears to be based upon incidents which arguably are not directly attributed to the club's management because they involve the acts of individuals outside of the club's premises or because they lack independent substantiation. The incidents include, for example, reports of persons loitering outside, fights between patrons, and a police officer allegedly smelling the odor of marijuana in the club. Music and live entertainment venues add significantly to the culture of the City, as they have for years. Much of the new music being created today is electronic music that is played in and supported by the clubs in SOMA and the rest of the City. Clubs can be seen as a vital part of the City's culture. Unfortunately, drug use is a part of the club scene. But while there may be a correlation between clubs and drugs, the presumption of a cause-and-effect relationship is mistaken. The problem of drugs extends beyond the club environment. The London Drug Policy Forum has reported that with drug-taking prevalent throughout modern youth culture and not just amongst clubgoers, efforts to stop drug use outright are less effective than harm-reduction efforts such as educating users about the effects of drugs and how to prevent overdoses. The Forum also reported that good relationships between the police and clubs lead to increased reporting of drug-related incidents to local authorities. A senior epidemiologist with the San Francisco Community Substance Abuse Center who has studied the use of GHB informed Civil Grand Jury members of their belief that while people take GHB in club settings, people would frequent private parties and raves instead if there were no clubs open late. In his opinion, people are actually at greater risk of harm if they use GHB and other drugs outside of the clubs because private, unregulated parties will not have staff who can work with the police and call for help in emergencies. Police services are paid for by taxpayers, which include clubowners, employees, and clubgoers. One club reported to the Civil Grand Jury that it employed 63 people in 1999 and paid over $14,000 in local payroll, business, and property taxes and over $130,000 in sales tax. Another reported that it drew an estimated 200,000 to 300,000 people every year and had patrons coming from all over the world to attend promoted events. Clubs are legitimate businesses which generate sizable revenues for the City. Admittedly, their operations also generate public health and welfare issues which need to be addressed. But removing the permit process from the police who could focus on enforcement of the laws applicable to clubs, instead of on the administration and adjudication of permits, is a sensible solution that recognizes the rights of clubs that operate responsibly and the efforts of the police in protecting citizens and maintaining the peace.

Related Recommendations (1)

The City should establish a permit commission based on the model presented by the ISCOTT licensing commission. Attempting to address the issue of fairness in the permit suspension and revocation process, Supervisor Mark Leno recently proposed legislation to create a "safe haven" for owners and event promoters who call 911 in emergencies. [9] Because 911 calls were being counted as black marks against the clubs and used by the SFPD to justify the revocation of club operating permits, club owners were deterred from calling 911. Such a situation not only penalizes those owners who act responsibly towards their customers by calling for help, but jeopardizes the health of those who need emergency medical care. The legislation proposed by Supervisor Leno also calls for Legislative Analyst research on the creation of an entertainment commission which could potentially address all issues related to late-night entertainment venues such as dance clubs, such as permitting, labor, health, consumer, planning, and public nuisance issues. [10] Because the creation of an all-encompassing entertainment commission may prove to be unworkable, the Grand Jury recommends that a new, smaller commission be established exclusively to handle entertainment venue permits in San Francisco. This commission could be modeled after the Interdepartmental Staff Committee on Traffic and Transportation (ISCOTT), established in 1983 to consider all applications for the temporary use or occupancy of public streets for street fairs or athletic events such as the annual Bay to Breakers race. [11] ISCOTT consists of the department heads, or their designated representatives, from the departments of Parking and Traffic, Public Works, Police, Fire, Public Health, Municipal Railway, and City Planning. The Director of the Department of Public Works, or his or her designee, serves as the Chair of the committee. Although not on the committee, the Director of Administrative Services, or his or her designee, reviews the recycling plan for the proposed event and makes a recommendation to the committee about whether or not the committee should approve the application. A permit commission could consist of the same department heads or representatives as those serving on ISCOTT. Not only would the participation of other departments make the permit process less partisan because of the diversification of views, but it would eliminate the inherent conflict caused when the same department issuing the permits and retaining authority to revoke or suspend permits also builds cases against permit holders. Under the current process, the police act as "judge, jury, and executioner." Moreover, the inclusion of other departments in the process would be beneficial in addressing larger issues of municipal services and planning for the SOMA area. For example, if MUNI were to participate in such a commission, the department might be alerted to the need for the area to have additional public transportation on certain nights. The scheduling of additional bus routes might thereby reduce some of the car traffic in the area and, subsequently, traffic violations would be reduced. The San Francisco Traffic Code sections that govern ISCOTT and its application review and approval process set out the prerequisites for applying for and the conditions for obtaining permission for the temporary use or occupancy of a public street. A process similar to that used by ISCOTT could be established for a permit commission. The commission could review applications and decide, by majority vote, whether to grant, conditionally grant, or deny the application. Examples of conditions imposed by ISCOTT on the grant of an application include the applicant's payment for the cost of Parking Control officers and 10(B) police officers, the development of a limousine and shuttle bus plan mutually acceptable to the Mayor's Office and the SFPD, or payment for the cost of advance warning signs. [12] Club permit applications could also be conditioned upon the applicant's satisfaction of specific security, noise, health, and other conditions. Suspensions or revocations of permits could similarly be decided. An appeal of a decision could be made first to the director chosen to chair the commission, who, after conducting a hearing, would affirm, reverse, or modify the commission's decision. A further appeal could be taken to the Board of Appeals, which currently hears these appeals. As part of an interdepartmental commission, the SFPD would no longer control the permit process. However, as a part of the commission, the SFPD would be able to present evidence and reasons in support of their position on a given application. Each department could also bring a suspension or revocation action against a permit holder, by submitting a factual report to the commission for its consideration. In this proposed model, the Department of Public Health could argue for the suspension of a club permit because the club does not provide a safe dance environment (e.g., by failing to employ emergency medical technicians or to supply free or low-cost water to patrons). Required Response Mayor Board of Supervisors The SFPD

The permit process as established appears to allow the police to set public policy regarding the existence of after-hours clubs. One case in point is that of the DNA Lounge nightclub. Last August, the club was purchased by a new owner who applied to the Southern District's permit office for a transfer of the club's existing operating permits. The permit office approved the application, but made the issuance of the permits contingent upon 18 new conditions. The conditions effectively revoked the club's after-hours operating permit, which allowed the club to stay open until 6 a.m. every day and without which the club would have had to close at 2 a.m. on weekdays and Sundays and prohibit people from entering after 2 a.m. on all nights. The new owner brought an appeal to the Board of Appeals, which overturned the police decision. One of the charges of the new owner was that the police were imposing a de facto moratorium on after-hours clubs. While there is no official moratorium, no after-hours permits appears to have been granted in SOMA in the last five years. The reason for this is not clear. One police officer acknowledged to the Civil Grand Jury that the problems with clubs are not correlated to the holding of after-hours permits. In fact, with many clubs closing at the same time, at 2 a.m., the police often have difficulty dealing with incidents occurring at different places at the same time. [8] Occasionally, the district will run out of officers and have to draw on other districts to respond to calls. However, after-hours clubs, however, close at different hours, which can reduce the burden on police at concentrated times. By enforcing the permit process in the manner that it does, the Southern District of the SFPD essentially sets policy on after-hours entertainment in SOMA. While the desire of the police to reduce problems related to clubs is laudable, the role of the police is to protect the public and preserve the peace, not to set public policy on the hours that businesses are permitted to remain open. If elected officials make the legislative determination that after-hours clubs are detrimental to the public's health and welfare and should be eliminated, that is the proper function of that branch of government and not a proper function of law enforcement.

Related Recommendations (1)

The conditions for clubs to meet should be standardized and specified in the Police Code, as with the conditions imposed on applicants for street use permits. [13] Currently, the conditions imposed upon permit holders vary in type and severity depending upon the permit officer's personal determination and opinion about an applicant or permit holder. Department heads provide only verbal guidance to permit officers; there are no written guidelines for permit officers to follow. Instead, the permit officer interviewed by the Civil Grand Jury said that the conditions imposed on permit holders are based on "good sense and good police work." Such vague and subjective bases for setting permit conditions do not make for just decisions about business permits. The club owners interviewed by the Civil Grand Jury report frustration in their dealings with the police over the policing of permits because they do not know what standards they are being measured against or what requirements will next be instituted by a permit officer and a district captain. As one owner put it, the police are constantly presenting club owners with a "moving target" when it comes to permit conditions. The Civil Grand Jury recommends that the conditions that clubs must meet in order to operate, and that the police should enforce, should be standardized and specified in the Police Code. For example, clubs, depending upon their size, could be required to have a certain number of security guards or trained medical personnel for a given number of patrons. They could be required to secure the area surrounding their premises up to a specified number of feet and to monitor patrons waiting in line to get into the club. Clubs could also be prohibited from allowing patrons to go in and out, or required to provide a "cooling-off" room with air conditioning and water. Closing all clubs at 2 a.m. is not the answer to the drug problem and it may displace the problem to unregulated, non-commercial locations. Instead, a working relationship between police and club owners is likely to be more effective in the fight against drugs. When club owners are made aware of the standards to which they will be held before the permits which they need to operate are jeopardized, they will not only be more likely to meet those standards, they will be more likely to cooperate with the police on all matters. Required Response Mayor Board of Supervisors The SFPD

Additional Recommendations 4

These recommendations are not explicitly linked to specific findings.

R3

Applicants and permit holders should be treated equally throughout the permit process. One club owner told the Civil Grand Jury that he would welcome a permit process that treated all clubs the same, so that he could operate his club on a "level playing field" with his competitors. Allowing some clubs to operate between the hours of 2 a.m. to 6 a.m. but not others places those that do not at a disadvantage because they lose the customers who want to stay out late. After-hours and all other permits should be issued in a fair and equal manner, with permit holders being subject to the same conditions. Required Response Mayor Board of Supervisors The SFPD
R4

Permit holders should be fully informed as to the types of incidents that will be attributed to them as permit violations and subject them to a permit hearing for the suspension or revocation of permits. Presently, the SFPD does not have any rules or published guidelines on what should constitute a complaint attributable to nightclubs. Therefore, the police may cite incidents or crimes occurring on neighboring streets to clubs, in the belief that these incidents and crimes happen there because the clubs attract people to the area. This practice appears to be flawed and unfair to clubs because, by extension, the merchants in Union Square, the San Francisco Giants at PacBell Park, or the operator of any large venue in the City should likewise be held responsible for the incidents and crime occurring near their premises due to the crowds that they draw. SFPD permit officers are given only general guidance by department heads about what incidents may be used in a permit hearing. The police have stated that they attribute the drug activity outside of a club to that club because the club attracts people who "might be predisposed to late-night drug use." [14] Thus, the SFPD, by threatening to revoke the permits which clubs need to operate, effectively hold the clubs responsible for the acts committed by a handful of individuals, some of whom may not even be club patrons.[15] Club owners should be held to be negligent in maintaining their clubs if criminal activity occurs inside of the clubs and is documented.[16] The Los Angeles police permit regulation holds permittees responsible "for the actions of their agents or employees in the conduct of the permitee's business." [17] A distinction should be made between incidents which are fairly attributable to clubs and their operation and those incidents which are not because they are caused by individuals outside of the control of club management. The following list presents examples of the general distinction that could be made: POSSIBLY ATTRIBUTABLE TO CLUB POSSIBLY NOT ATTRIBUTABLE TO CLUB MANAGEMENT MANAGEMENT  Knowledge or reasonable suspicion of, and  Assaults/fights amongst patrons or failure to prevent, drug use and dealing inside perpetrated by patrons outside of a club club  Thefts from cars in alleys or streets near a  Failure to assist patrons or provide adequate club security  Theft within a club (e.g., pickpocketing) in  Failure to operate lawfully (e.g., admitting spite of efforts of club security minors, operating without proper permits)  Traffic congestion around clubs  Service of alcohol to minors or after last call  Loitering of suspicious persons on streets  Incidents related to employee behavior or around the club actions  Overcrowding of club  Violating noise ordinances With general guidance, club owners can operate knowing what they are responsible for and when their permits may be at risk. Thus, for example, a club that institutes pat-down searches of patrons by private security guards would not risk having its permits suspended when someone waiting to get in the club leaves the line to avoid the pat-down, but is stopped by police officers watching the club and found to have drugs in their possession. At present, the permit officer can record this incident as a mark against the club and use it as evidence to hold a permit hearing because that person was drawn to the club. But arguably, the club attempted to operate responsibly by searching would-be entrants and preventing those with drugs from entering and the incident should not be held against them. With established guidelines, the police and club owners will have a better idea of what will and what won't be grounds for the suspension or termination of permits. Additionally, increased fairness will promote faith in and support for the permit system and police enforcement, and hopefully foster more cooperation between the police and club owners. Required Response Mayor Board of Supervisors The SFPD
R5

The 10(b) program should be made available to all club owners, after a restructuring of program to remove the potential for conflicts of interest. The 10(b) program is a voluntary overtime program which allows the use of uniformed police officers as security personnel at special events, sports matches, construction sites, filming sites, dance clubs, department stores. A moratorium was placed on the 10(b) program for clubs because the Chief of Police perceived a conflict of interest in having a police officer work for a club on a regular basis and be paid by the club through the program. Such an ongoing relationship could create a conflict for the officer when observing criminal activity or problems in the club. Only two clubs, both owned by the same owner, are currently allowed 10(b) officers, the Sound Factory and City Lights. The moratorium should be lifted and all clubs should be offered the use of officers. The conflict problem could be reduced by imposing a limit on number of overtime hours an individual officer can work under this program. Alternatively, clubs could form a trade association to fund the use of 10(b) officers. Such an association could also represent the clubs' legitimate business interests and set up community projects to mitigate some of the negative effects of the presence of clubgoers in the neighborhood, such as cleaning trash and debris from streets or deploying trained health staff to distribute anti-drug literature and informational materials at club events. Required Response Mayor Board of Supervisors The SFPD
R6

Decibel levels should be standardized for all clubs and based upon up-to-date engineering criteria. Presently, the SFPD does not have firm criteria to measure the noise emanating from a club. Different noise stipulations are therefore placed on permits. As a general rule, noise should not be audible on another person's premises. Noise problems usually result when a club opens its windows or doors. The SFPD Central Dispatch handles noise complaints related to loud music or noise from dance clubs. After a documented warning, an officer can issue a citation under Section 415(2) of the Penal Code and arrest the offender. If noise is a chronic problem, the SFPD's Noise Abatement Unit assists in resolving the situation.[18] A few police officers have attended a special noise evaluation training class at Rutgers University in New Jersey. However, the SFPD acknowledges that standard noise guidelines are not used, claiming that to do so is not feasible as club locations and sites differ. Notwithstanding location and site variation, standardized criteria as to acceptable noise decibel and occupancy levels should be developed to eliminate differences in the treatment of permit holders. The Civil Grand Jury was informed that the SFPD and the Department of Public Health have worked on redrafting the current noise regulations. The two departments should move forward to complete their redraft of the regulations with appropriate input from parties that would be subject to them. Required Response The SFPD Department of Public Health Footnotes [1] Most of the media coverage over the SFPD's permit actions have centered around two clubs with after-hours permits, Ten 15 Folsom and the Endup. Other clubs whose permits have been suspended or threatened with suspension include Six and Maritime Hall. [2] The San Jose Chief of Police also reviews applications for and issues public dancehall and public entertainment permits. In Los Angeles, applicants apply to the Board of Police Commissioners (which includes civilians appointed to serve on the commission), which issues all police permits required for certain types of businesses, such as dance clubs. [3] Emulating SOMA, the area south of First Street in downtown San Jose is being marketed as "SOFA (South First Area), The Bay Area's Newest Entertainment District," featuring live music, dancing clubs, dining, pool, and art galleries. [4] See, e.g., "Status Report: GHB Use In San Francisco," Department of Public Health, Community Substance Abuse Services, October 21, 1997. [5] Raves are all-night indoor or outdoor dance parties often held illegally in large private spaces without permits and primarily attended by teenagers and young adults who listen to electronic and trance music. [6] See "Status Report: GHB Use In San Francisco," supra. [7] SFPD Complaint against Vincent Healy Bino, et al. (d.b.a. Annie's Bar & Grill), March 6, 1999; SFPD Complaint against Carl F. Hanken (d.b.a. "End Up"), October 18,

Conclusions 3

CL1 Page 1

The permit process as established appears to allow the police to set public policy regarding the existence of after-hours clubs. One case in point is that of the DNA Lounge nightclub. Last August, the club was purchased by a new owner who applied to the Southern District's permit office for a transfer of the club's existing operating permits. The permit office approved the application, but made the issuance of the permits contingent upon 18 new conditions. The conditions effectively revoked the club's after-hours operating permit, which allowed the club to stay open until 6 a.m. every day and without which the club would have had to close at 2 a.m. on weekdays and Sundays and prohibit people from entering after 2 a.m. on all nights. The new owner brought an appeal to the Board of Appeals, which overturned the police decision. One of the charges of the new owner was that the police were imposing a de facto moratorium on after-hours clubs. While there is no official moratorium, no after-hours permits appears to have been granted in SOMA in the last five years. The reason for this is not clear. One police officer acknowledged to the Civil Grand Jury that the problems with clubs are not correlated to the holding of after-hours permits. In fact, with many clubs closing at the same time, at 2 a.m., the police often have difficulty dealing with incidents occurring at different places at the same time. [8] Occasionally, the district will run out of officers and have to draw on other districts to respond to calls. However, after-hours clubs, however, close at different hours, which can reduce the burden on police at concentrated times. By enforcing the permit process in the manner that it does, the Southern District of the SFPD essentially sets policy on after-hours entertainment in SOMA. While the desire of the police to reduce problems related to clubs is laudable, the role of the police is to protect the public and preserve the peace, not to set public policy on the hours that businesses are permitted to remain open. If elected officials make the legislative determination that after-hours clubs are detrimental to the public's health and welfare and should be eliminated, that is the proper function of that branch of government and not a proper function of law enforcement.
CL2

Recent police actions to suspend or revoke club permits are in part based upon incidents that are not fairly attributable to club management. The basic premises of the SFPD with respect to clubs that are negligently managed are: (1) the clubs constitute a "threat to the health, safety, and welfare of the community" by bringing in the wrong element (either patrons or persons who prey on patrons) to the city; (2) the clubs are a "repeated disruption to the neighborhood" and especially to residents who live nearby; and (3) the clubs are a constant "strain on police services" because police resources are expended to respond to complaints and calls related to the clubs. [7] The SFPD's present practice is to cite all incidents which they believe are related to a club as evidence of negligent management. So, when a club's security staff calls the police to arrest an unruly person trying to get into the club or the paramedics to assist a drunk and dehydrated dancer, these responsible acts on the part of club management are used by the police against the club at a later date. Even incidents which take place outside of a club's premises and over which club management has little or no control, such as car break-ins in alleys on nearby streets or "suspicious" persons hanging around the club's premises, are cited in the police complaints and permit hearings to suspend or revoke a club's permits. Anonymous third-party complaints about a club may also be used to institute permit suspension or revocation proceedings. Earlier this year, the Maritime Hall received notice that its permits were under threat of suspension based on 22 incidents alleged by the police to have occurred over the course of five years. The police complaint appears to be based upon incidents which arguably are not directly attributed to the club's management because they involve the acts of individuals outside of the club's premises or because they lack independent substantiation. The incidents include, for example, reports of persons loitering outside, fights between patrons, and a police officer allegedly smelling the odor of marijuana in the club. Music and live entertainment venues add significantly to the culture of the City, as they have for years. Much of the new music being created today is electronic music that is played in and supported by the clubs in SOMA and the rest of the City. Clubs can be seen as a vital part of the City's culture. Unfortunately, drug use is a part of the club scene. But while there may be a correlation between clubs and drugs, the presumption of a cause-and-effect relationship is mistaken. The problem of drugs extends beyond the club environment. The London Drug Policy Forum has reported that with drug-taking prevalent throughout modern youth culture and not just amongst clubgoers, efforts to stop drug use outright are less effective than harm-reduction efforts such as educating users about the effects of drugs and how to prevent overdoses. The Forum also reported that good relationships between the police and clubs lead to increased reporting of drug-related incidents to local authorities. A senior epidemiologist with the San Francisco Community Substance Abuse Center who has studied the use of GHB informed Civil Grand Jury members of their belief that while people take GHB in club settings, people would frequent private parties and raves instead if there were no clubs open late. In his opinion, people are actually at greater risk of harm if they use GHB and other drugs outside of the clubs because private, unregulated parties will not have staff who can work with the police and call for help in emergencies. Police services are paid for by taxpayers, which include clubowners, employees, and clubgoers. One club reported to the Civil Grand Jury that it employed 63 people in 1999 and paid over $14,000 in local payroll, business, and property taxes and over $130,000 in sales tax. Another reported that it drew an estimated 200,000 to 300,000 people every year and had patrons coming from all over the world to attend promoted events. Clubs are legitimate businesses which generate sizable revenues for the City. Admittedly, their operations also generate public health and welfare issues which need to be addressed. But removing the permit process from the police who could focus on enforcement of the laws applicable to clubs, instead of on the administration and adjudication of permits, is a sensible solution that recognizes the rights of clubs that operate responsibly and the efforts of the police in protecting citizens and maintaining the peace.
CL3

The permit process as established appears to allow the police to set public policy regarding the existence of after-hours clubs. One case in point is that of the DNA Lounge nightclub. Last August, the club was purchased by a new owner who applied to the Southern District's permit office for a transfer of the club's existing operating permits. The permit office approved the application, but made the issuance of the permits contingent upon 18 new conditions. The conditions effectively revoked the club's after-hours operating permit, which allowed the club to stay open until 6 a.m. every day and without which the club would have had to close at 2 a.m. on weekdays and Sundays and prohibit people from entering after 2 a.m. on all nights. The new owner brought an appeal to the Board of Appeals, which overturned the police decision. One of the charges of the new owner was that the police were imposing a de facto moratorium on after-hours clubs. While there is no official moratorium, no after-hours permits appears to have been granted in SOMA in the last five years. The reason for this is not clear. One police officer acknowledged to the Civil Grand Jury that the problems with clubs are not correlated to the holding of after-hours permits. In fact, with many clubs closing at the same time, at 2 a.m., the police often have difficulty dealing with incidents occurring at different places at the same time. [8] Occasionally, the district will run out of officers and have to draw on other districts to respond to calls. However, after-hours clubs, however, close at different hours, which can reduce the burden on police at concentrated times. By enforcing the permit process in the manner that it does, the Southern District of the SFPD essentially sets policy on after-hours entertainment in SOMA. While the desire of the police to reduce problems related to clubs is laudable, the role of the police is to protect the public and preserve the peace, not to set public policy on the hours that businesses are permitted to remain open. If elected officials make the legislative determination that after-hours clubs are detrimental to the public's health and welfare and should be eliminated, that is the proper function of that branch of government and not a proper function of law enforcement.