With broad-based support on the Common Council, Wauwatosa seems set to prohibit chain restaurants on North Avenue in East Tosa.
Under a proposed amendment to the zoning code, the city could reject "formula restaurants" from the business district that stretches 16 blocks from North 60th Street to Wauwatosa Avenue (76th Street).
- For more on reaction to this proposal, see the WISN 12 news report attached to this article.
The measure was introduced Tuesday night at a meeting of the Committee of the Whole by Ald. Joel Tilleson of the 5th District, which includes the north side of the avenue.
Prohibited by the zoning change would be any restaurant meeting the criteria of a formula restaurant, which include:
- ownership of 11 or more establishments in the United States having a significantly common menu;
- standardized building design, decor and color scheme;
- staff apparel;
As introduced, Tilleson's proposal offered the Common Council the opportunity to impose the ban on either or both the North Avenue/East Tosa district and the Village district.
There is also a provision for a review and possible acceptance of any business that might meet the "formula restaurant" criteria and yet be approved for other reasons.
Village excluded for the time being
By strong consensus, the council decided to exclude the Village from the proposal, at least for now, but to give it a try in East Tosa, which asked for it.
Tilleson's motion on the amendment was seconded and championed by Ald. Cheryl Berdan of the west side 7th District.
"I see this as both pro-business and pro-community," Berdan said.
Tilleson said the zoning change was eagerly backed by the East Tosa Alliance, the group that created the North Avenue Plan for business revitalization. The Village Business Improvement District has not weighed in, and that difference weighed heavily with aldermen in choosing to exclude the Village.
There was, in fact, a solid majority of the 15 council members present who were ready to approve the motion and send it immediately to final approval minutes later in the regular meeting of the Common Council.
Among those voicing favor were Alds. Pete Donegan, Jim Moldenhauer of District 1 and Tilleson's counterpart in the 5th, Bobby Pantuso. But support came from every part of Tosa, and no one said a word in opposition.
Public to have a say in decision
The majority bowed to a minority, though, when Alds. Kathleen Causier, Dennis McBride and Jeff Roznowski — all of whom said they supported the idea — argued that the amendment deserved a public hearing.
With that, it was unanimously referred to stops before the Plan Commission on March 11 and then the Community Development Committee before it heads back to the full council.
Tilleson said his amendment was spurred by metro business demand, and not just by locals.
"East Tosa properties are in such high demand now," he said. "There are more people wanting to get in than there are places available. So we have a high demand and a low supply in the market."
Since the creation and adoption of the North Avenue Plan in 2011, a number of new independent or small-group businesses have already come in, beginning with Rocket Baby Bakery, the first to receive public assistance and to open on the avenue under the plan.
The biggest influencer so far has been the upcoming BelAir Cantina, a hip Mexi-Cali place soon to open on the southwest corner of 68th and North, dead center in the district.
BelAir is the second restaurant of that name in the metro area — the first is on Water Street in downtown Milwaukee — and is owned by the Mojofuco Restaurants group. Mojofuco owns five other small cafes besides the two BelAirs, none of which is "branded" in any of the ways covered by the zoning change.
BelAir's entry prompted another restaurateur, Martin Beadoin, owner of the Red Dot, 2498 N. Bartlett Ave. on Milwaukee's east side, to buy Shepherd's Sports Bar. It will become the Sherbrook, modeled on BelAir but with a different (and to-be-determined) theme and menu.
Coming and existing chains safe from zoning ban
Sources who did not wish to be identified because of ongoing area business negotiations told Wauwatosa Patch that it was a sign of the times that a number of Milwaukee-area interests had their eyes on the Dairy Queen property on North.
But DQ corporate is turning the property over to Wing Stop, another fast food chain, in a lease agreement that the neighborhood and the city are fairly powerless to stop.
Tilleson though, said his proposal was not reactive to Wing Stop or any other business that might have wanted to come in — and in fact, as City Attorney Alan Kesner confirmed, won't halt Wing Stop from opening on North.
"Their application is in," Kesner said. "With that, they are covered under the existing zoning code."
The district is home to a McDonald's, a Subway and a KFC; those and any other existing businesses that might otherwise fall under the new zoning would be grandfathered and unaffected by it.
Tilleson said that his introduction of the formula restaurant prohibition was keyed to a larger discussion of Zoning Code updates and that he would have introduced it "two months ago before Wing Stop was on the radar or two months from now after it was already approved," had the zoning discussion not coincided.
Giving local small businesses a boost
Tilleson's amendment, researched and drafted by Kesner, notes that:
"Money earned by independent businesses is more likely to circulate within the local neighborhood and City economy than the money earned by formula restaurant businesses which often have corporate offices and vendors located outside of Wauwatosa..." and:
"Formula restaurant businesses can have a competitive advantage over independent operators because they are typically better capitalized and can absorb larger startup costs, pay more for lease space, and commit to longer lease contracts. This can put pressure on existing businesses and potentially price out new startup independent businesses."
With the high demand from more local and unique businesses in the district, Tilleson said, it was time for action to give local interests a chance to work their way into properties that too often just change corporate hands.
"We've seen a lot of these places change hands from one chain to another," he said, "and so in one way we're trying to minimize the chance that a business might fail.
"If you were doing this citywide, you'd run into trouble. It has to be narrowly tailored. We're saying, 'Let us help you find a place you can flourish.'"
Restaurant group raises cautions
Not everyone is so sure the prohibition is a good idea.
Pete Hanson, vice president of public relations for the Wisconsin Restaurant Association, had a couple of quibbles without having had the opportunity really to study the Wauwatosa ordinance.
"What about some of the locally founded restaurants," Hanson said. "Would Wauwatosa not allow a Chancery in? The Chancery has been in Wauwatosa forever – I think it was founded there. Would they let a George Webb in?
"You also have to remember that whenever you see a branded restaurant anywhere in the country, it's usually owned by a franchisee, someone who lives in your community, pays taxes, sends their kids to the same schools your kids go to – and are selling a product people clearly want."
"And finally," Hanson said, "an ordinance like this can reduce competition. You're saying to the consumers in your community, 'You may have to pay higher prices.'
"So, while I'm not definitely saying what Wauwatosa is doing is wrong, I would caution against not allowing certain types of restaurants. It's usually not a good thing for consumers."
Every rule has an exception
The prohibition is not absolute and final even for East Tosa. A provision allows for approvals of formulaic chain establishments within a prohibited zone if it can be shown that it fills a void in demand under certain conditions.
For instance, a new mixed-use development with retail spaces might be allowed to tenant a chain coffee shop or cafe — Alterra, Starbucks and Panera were all names tossed around by council members.
Tilleson said that similar prohibitions have beeen created and stood up to tests of law in a number of communities in California. A New York Times story details one such ban in South Los Angeles.
And there is even a precedent in Wisconsin, he said. Sister Bay, in Door County, instituted a formula restaurant ban, was sued by a sub sandwich chain — and won.
The Milwaukee Journal Sentinel covered that proposition after Subway tried to become the first fast food chain to enter the Door County community.