Temecula City Council Revokes The Bank’s Conditional Use Permit

The Temecula City Council last Tuesday approved an ordinance officially revoking The Bank’s conditional use permit, which allowed the business to serve distilled spirits and have live entertainment.

The unanimous vote, part of the meeting’s consent agenda, was made without comment two weeks after the city held a hearing on the matter where attorneys for the city, the restaurant and the property owner could make their case.

“We’ve tried to contribute as best we could to be part of the solution, not part of the problem,” Ryan Parent, co-owner of The Bank, said. “To be labeled with what we’ve been labeled with is just unfair, and there’s been really no evidence to support.”

At the hearing, Jennifer Petrusis, attorney for the city, told the council that the restaurant had received more than 100 citations and civil penalties over the course of 17 months.

“To sum up the city’s position, given the evidence of 17 months worth of undisputed violations of the CUP, including admitted violations of its operating hours, admitted violations of the approved hours to sell alcohol, undisputed excessive noise violations and evidence that the bank had become a disorderly house in violation of its CUP, the city council should uphold the planning commission’s decision to revoke the CUP,” she said.

The case for revoking the CUP had previously been heard by the planning commission and an administrative law judge, both of which recommended the revocation. At the hearing, all of the same evidence was presented to the city council for a final determination.

All three parties — the city, the restaurant and the property owners — agree that there were over 100 citations and civil penalties issued. They all also agreed that a CUP was issued in January 2008 allowing The Bank to serve distilled spirits in addition to beer and wine.

All three parties also agreed that a modified CUP was approved in October of that same year allowing the restaurant to extend its hours to 2 a.m. on all days. They all also agreed that a modification to that permit was requested  and granted in February 2012 to allow live entertainment for the purpose of providing background music until 10 p.m.

However, the paperwork for the 2012 permit application references only the January 2008 permit and not the one from October 2008. And while the 2012 permit does allow for live entertainment for the purpose of background music, it also rolled back the permitted operating hours to those included in the January 2008 permit and made several references to meetings that happened in December 2007 and at one point referred to the restaurant as applying for a Type 47 liquor license — a license the restaurant obtained in January 2008.

James Penman, attorney for the restaurant, argued that the allowed hours of operation were changed in error by the city and noted that the shortened hours were not enforced by the city for nearly a decade.

“The city did not start enforcing the alleged closing time until February of 2021, nine years after the city now claims the minor modification of the CUP in 2012 required the bank to close at 10 p.m. Monday through Friday [and] at 11 p.m. on Friday, Saturdays and holidays,” he said. “And this is even though the fire marshal inspects the premises on an annual basis, and even though city employees and officials frequented the restaurant during those nine years, including many after 11 p.m. on Fridays and Saturdays.”

Petrusis argued that whether or not the change in permitted operating hours was done in error didn’t matter since it was not appealed by the permit holder.

“As part of its normal process, staff notified Mr. Puma about his right to appeal the conditions of approval,” Petrusis said. “If Mr. Puma wasn’t happy with the conditions of approval, including the operating hours, he had 15 days from the date of approval to appeal. It is undisputed that Mr. Puma did not appeal the conditions of approval.”

City Attorney Deborah Fox later told the council that a lack of enforcement did not void the stipulations of a conditional use permit.

“What happened here is we learned, the city learned, there was a problem when the Temecula police officer informed code [enforcement] that they had a problem at the bank,” she said. “So the fact that you didn’t enforce — maybe they were operating, but you hadn’t been put on notice there was a problem — there isn’t any acquiescence or waiver of those conditions because that did not occur.”

Petrusis also argued that The Bank restaurant had become a “disorderly house,” citing “problems related to over service of alcohol at the bank restaurant that resulted in disturbances caused by fights and public intoxication,” including two shootings — one in November 2021 and the second in January 2022.

“A disorderly house is defined as a licensed outlet that disturbs neighbors with noise, loud music, loitering, littering, vandalism, urination, defecation, graffiti, etc., and or has many ongoing crimes inside or in the parking lot such as drunks, fights, assaults, prostitution, narcotics, narcotics, et cetera,” Petrusis said.

However, restaurant co-owner Amanda Lane said The Bank had been more proactive than most other businesses in Old Town Temecula in providing additional security and complying with law enforcement — closing early during the pandemic at the request of the sheriff’s department and even hiring additional licensed security for the bar and paying out of their pocket to install a security system in a public parking lot behind the restaurant.

“Our capacity is for 119 people, I believe, so for our capacity, having 14 security guards on is insane,” Lane told The Riverside Record. “It’s overkill, but it was so we wouldn’t have those issues.

“Nobody stepped on property that was already intoxicated,” Lane continued. “If they had already been to multiple places, we wouldn’t let them in for that reason.”

Petrusis noted that the restaurant had been cited multiple times for noise violations. According to information presented to the city council, The Bank has received 17 citations for noise — seven of which have been paid — and 84 citations and civil penalties for operating outside of the hours established in the conditional use permit — 60 of which have been paid.

Lane said she has reached out to city hall multiple times in an effort to get the hours on the conditional use permit changed from those present in the 2007 permit to the 2008 permit to no avail.

“I actually called, left messages, talked to [Deputy City Attorney] Luke Watson’s secretary, went to City Hall,” Lane said. “If you combine all the calls, the voicemails, the emails, and I can show I have them on my phone right now, of me and Craig [Puma] emailing him, he doesn’t respond at all.”

Lane told The Record that she believed getting the hours of the 2012 permit changed would resolve the issue of 84 of the citations and civil penalties, a statement backed up by the restaurant’s attorney.

“They thought that it was just a confusion within the city, and it was going to be resolved,” Penman said. “And they thought that the fines were going to be, at least the fines for staying open late, were going to be dismissed once that was done. 

“I think it was perhaps somewhat naive of them, but in my years of experience, I’ve learned that businesses are not run, usually, by lawyers, and they don’t pay as much attention to to the fine points of the permits and other things as as they do to the type of food they’re ordering and things of that nature,” he continued.

Penman also suggested that the reason the city was seeking to revoke the conditional use permit was due to the clientele served by The Bank.

“There have been several things suggested as reasons why what’s happened has happened,” Penman said. “One of them is the fact that the patrons of the bank are largely Latino and African American. There’s been some suggestion that there’s some bias involved there. I don’t know if that’s true, but some people believe it. Certainly The Bank people do.”

In response to this allegation, Fox said there was “absolutely no evidence” of racial bias in the request to revoke The Bank’s conditional use permit.

Rick Edwards, attorney for the property owner, argued that the property owner should not be held liable for the actions of its tenant and therefore the conditional use permit should remain intact for the property with the understanding that The Bank would no longer be able to operate there come May 30.

“Not a single citation was issued to Zip Third [Investments, LLC],” he said. “Nobody ever said you better do something about this tenant, nobody ever said you’re responsible for this tenant, nobody ever said we’re going to revoke as to you or fine you until the revocation letter, which was July.”

Petrusis said that was not the way the law worked.

“So if there is a property owner who is not responsible for the violations, and it’s the tenant that is responsible for the violations, then the CUP cannot be revoked,” she said. “That cannot be the law. The city cannot be hampered in that way. That is not what the law provides, and so we maintain our position that the city council should uphold the Planning Commission’s decision to revoke the CUP.”

Edwards also called conditional use permit revocation “real estate capital punishment,” and said it put a “black eye” on the property since any new tenant would have to start the permit process over, but the council said there should be no problem for a new tenant to seek a conditional use permit.

“I don’t think we’d have any problem getting another CUP,” Mayor Pro Tem James Stewart said. “The bank really is a landmark piece of real estate in the city of Temecula, so we of course want a business in there.”

Ultimately, the council voted unanimously to revoke the CUP after multiple comments about the sheer number of citations and civil penalties imposed on the business.

“I just know me, myself as a business owner, if I’m getting a citation from the city, I’m at the front door of the city and making sure I’m not getting another one,” Stewart said. “And so I don’t care who I have to run through, I’m running to somebody to make sure I got all my information, all my ducks in a row, and if they told me that my CUP says you’re supposed to close at a certain time, I would have filed for CUP correction or whatever. I would definitely make sure my business was in compliance, I wouldn’t, there’s no way I’d get 100 citations.”

“I think we just keep hitting the same thing, the 100-plus citations,” Councilmember Jessica Alexander said. “How many times do we have to continue to say that? But that’s huge for me.”

“The 100-plus citations is kind of where I’m stuck, as well, because after the first one, 10, 15, 20, 25, 50, 75, 100, it just seems like no one really paid attention to those,” Councilmember Curtis Brown said.

As for the future of The Bank, Lane told The Record that it will eventually close.

“I can tell you that there’s no way for it to stay open with cutting hours back that far and cutting the liquor,” she said. “We can’t sustain with the rent in Old Town.”

However, she said the business would try to make it to May 30, the final date the restaurant can operate in its current space. She also said the restaurant would be filing suit to get the matter in front of a superior court judge.

A full recording of the hearing can be found here on the city’s YouTube channel.