Bethany approves commercial lodging zone for Bethany Arms

The Bethany Beach Town Council last Friday voted to adopt a series of three ordinances that will pave the way for the redevelopment of the Bethany Arms Motel property as a flagship oceanfront hotel in a project proposed by local developer Jack Burbage.

After a second public hearing on the zoning ordinances held on Aug. 13 and a non-binding referendum whose results, announced on Aug. 13, showed strong support among voters for the changes they entailed, the council voted 6-1 on Aug. 16 to approve each of the ordinances.

The three ordinances: create a CL-1 Commercial Lodging zone; make related changes to the town’s comprehensive plan; and rezone to CL-1 the existing Bethany Arms parcels (currently zoned both C-1 Commercial and R-1 Residential), as well as a neighboring parcel under separate ownership that has also historically been in use as commercial lodging, but is zoned residential.

Freshly reminded by zoning attorney Max Walton that they must state their reasons for each vote on the ordinances, council members on Friday offered their take on how the rezoning would benefit the town, or, in the case of Councilwoman Margaret Young, harm it.

Setting the tone for much of the council commentary, Councilman Joseph Healy, recently retired from his work as an accountant, said he felt the council members needed to “do what is right for Bethany Beach” and noted that he had written a piece on the management of change and the economic importance of facilities within Bethany Beach, discussing the macroeconomic impact of the change on the community, as well as the region. That document was to be made part of the record of the hearing and vote.

Healy also took care of suggesting an amendment to the ordinance regarding the changes to the comprehensive plan that he said would clarify that Lot 12, on Block 110, (98 Hollywood Street) was included in the commercial area, per the information reviewed and approved by the state Preliminary Land Use Service (PLUS) and that the Town would be able to make a digital map reflecting the zoning changes, without further action by the council.

Councilman Lew Killmer explained Healy’s amendment as “a housekeeping issue,” stating that the differences between the proposed ordinance and the PLUS documents “was an oversight initially,” and that the amendment would make it “consistent with what was reviewed by PLUS.”

With no further discussion, the council voted 7-0 to approve the change to the proposed amendment.

Council members then laid out their cases for, or against, the zoning issues during their initial discussion and then reiterated those views or elaborated as each later ordinance was considered.

Killmer — addressing references to the comprehensive plan made by opponents of the changes — emphasized that the comprehensive plan is meant to be a “forward-looking roadmap,” containing “a number of short-term achievable milestones,” that “has to be flexible in nature so we can amend it when alternatives are presented to the town council.”

Stating his support for the first of the three ordinances, Killmer said, “Rezoning Parcels B and C will transition them from non-conforming to conforming, which is the ultimate goal of all planning commissions and local government.”

He said the changes would allow the Town to better manage growth, better manage possible commercial uses of the property to one single use and “preserves the historic presence of a hotel in Bethany Beach,” cementing the use of the large tract of land to support business and give people a reason to come to Bethany in the off-season, helping the town transition to a more year-round destination.

Killmer noted that the CL-1 zone requires off-street parking for guests, unlike the C-1 commercial zone. He said the resulting hotel “will not impact the density of individuals accommodated, offers an upscale boutique-style location, exceeds the requirements of the State, will be aesthetically pleasing and will not require variances to meet the vernacular of Bethany Beach.”

Quoting Director Constance Holland of the Office of State Planning Coordination, Killmer said the amendment was “the first step to rezoning the property to make the zoning consistent with the actual use.”

Healy, offering a second vote in favor of that first ordinance, said he found the change would meet a number of legal tests, with promoting the health, safety and welfare of the town among them.

“The economic factors alone are essential to our health, safety and the welfare of the town,” he said, adding that he felt the changes would promote the town’s present and future needs, as well as solidifying the town’s persona as offering a public beach, “which is very helpful for the public funds we receive as a public presence here in the region.”

Adding that he felt it would encourage appropriate uses of the town, Healy said, “I believe this zoning will facilitate us with an opportunity to put up a centerpiece of the town that could be to our benefit for many years to come.”

Councilman Jerry Dorfman added his affirmative, echoing Killmer’s statement and noting that Killmer had, with the other members of the planning commission, written the comprehensive plan.

“These properties have been used for commercial lodging for over 60 years,” Dorfman emphasized. “It’s time the proper zoning was attached to both properties.”

Mayor Tony McClenny also voted in favor of the changes. “The unanimous recommendation of the planning commission has merit,” he said, also noting that the new zoning allows commercial lodging but limits other commercial uses. Referencing the PLUS approval letter, he pointed out that the comprehensive plan includes a section titled “Economic and Community Development,” which refers to accommodations.

With an increasing number of permanent residents and a resulting decrease in the number of residential properties available for rent, McClenny said he expected demand for hotel accommodations in the town would only increase and that the new zoning would allow the property’s continued use by its owners as the commercial lodging it has been for more than 50 years.

He added that he felt there would be less vehicular traffic resulting from the hotel than if it was used for unrestricted commercial purposes and that the result would be safer for cyclists and pedestrians.

Vice-Mayor Jack Gordon also referenced the property’s use as commercial lodging for more than 60 years. “That is very appropriate use for the land,” he said, adding that it would promote the appropriate character of the area.

“It will facilitate accommodations,” he added, “but a new, improved and more attractive facility would definitely be an upgrade.” He, too, referenced the notion that increasing numbers of retirees would lead to fewer rental homes being available.

“It would be nice to have some sort of lodging here at that time,” he said, also supporting the idea that increased accommodations for visitors would support the town’s welfare by encouraging the State to continue to support the Town “in providing millions of dollars of sand on the beach,” as well as funding for projects such as the ongoing Streetscape work on Garfield Parkway, along with encouraging healthy activity in use of the beach.

Councilwoman Carol Olmstead again noted that the property “has been a historical location for a motel almost as long as this town has been in existence. For visitors to be able to visit this resort and have use of new, modern hotel continues that tradition,” she said. “Bethany is a public beach, and we profit from that. Our beach is maintained and financed, to a large extent, by our state and federal government. We all desire to keep in mind the character of our town, and I feel for sure, with Mr. Burbage’s proposal and oversight of our [Non-Residential Design Review Committee] that will happen.”

Referencing the Cultural & Historical Affairs Committee that she chairs for the town and the historical photos it maintains at the town museum, Olmstead noted, “Many changes have occurred in Bethany over the years. This is not a major change. Believe me — there has been enormous change over the years. This is just one more change in the year 2013 that will continue the positive growth of our town. Commercial lodging at that location, rather than the expansion of other commercial endeavors, is certainly in the interest of our town in every way.”

Young offers lone opposition on council

Young set out her arguments against the changes, stating first that she felt the commercial lodging zoning did not promote the appropriate character of the area.

“It is composed of small businesses, condos and residential homes,” she said. “This would facilitate the creation of a large three-story hotel with no open space, no setbacks, no light or air,” she added, stating that she considered the area “the most congested area in Bethany Beach, where it’s almost impossible to pass another car.”

Cars were a key element of Young’s objections, as she stated that the requirement of one parking space per hotel unit might not be sufficient, especially as no employee parking was required to be provided and trucks making deliveries might cause further problems.

“This would create a solid wall on both sides of Hollywood and the east side of Atlantic,” she added, also citing that the zoning would not avoid creating “an undue concentration of population” in that area, adding 100 to 115 rooms — “possibly greater” — that she said would create a greater concentration of population than the existing Bethany Arms and former Blue Surf rooms, which are and were considerably larger but fewer in number.

Further, she said, the change “sets a precedent for further extension of the commercial areas, which citizens voted overwhelmingly against in the town survey,” which was conducted in 2005.

With those statements made, the council voted 6-1 to approve the first of the three related ordinances, with Young the sole opponent.

Zone to include other parcel

The council then moved on to the ordinance establishing the CL-1 district. It, too, got an amendment on Friday, with late changes suggested to reduce the required minimum lot size for CL-1-zoned properties to 3,750 square feet — reduced from 5,000 square feet. The smaller figure is the size of Lot 12 — 98 Hollywood Street — which has also long been operated as a short-term commercial lodging facility, consisting of several large apartments.

While Burbage had earlier this summer said he had not yet reached an agreement with the owners of Lot 12 to purchase that property and would move forward with the hotel project without it, Lot 12’s owners had more recently come to the Town to ensure that their property was being included in the CL-1 rezoning.

They did not confirm an intention to sell it to Burbage for his hotel but said, “What’s good for the goose is good for the gander” and asked the Town to ensure that the existing parcel size wouldn’t be an impediment to their CL-1 use.

Killmer last Friday argued in favor of the reduction in the minimum lot size for the zoning, saying it would move Lot 12 from the status of non-conforming (too small for CL-1 or having a commercial lodging use in a residential district) to conforming with the updated town zoning code.

“We don’t want to make a non-conforming property in creating the commercial lodging district,” he emphasized.

Young questioned the change. “Most of the lots are 5,000 square feet in Bethany. Why do we want to change this?” she asked.

“If we don’t change it and this zoning district is created, one of the parcels, from the very beginning, will be non-conforming,” Killmer explained. “Non-conformities should be minimized or eliminated as much as possible. It won’t affect anything else in the original ordinance, but it will make that one parcel conforming to the requirements of the CL-1 district.”

McClenny also noted that removing the non-conformity would ensure that the property could be rebuilt as it stood if anything were to happen to it, such as destruction by fire or storm. “It would create hardships for the owner if it is not conforming from the beginning,” Killmer agreed.

The council again voted unanimously to accept the amendment to the ordinance, before heading into further discussion and a vote.

Council members cite benefits of new zoning

Killmer voted in favor of creating the CL-1 district, noting that there is already a large motel and 10-unit and four-unit apartment houses on the properties involved, offering accommodations for up to 350 guests, and asserting that congestion in the area would not be noticeably impacted, due to the requirement for one off-street parking space for each unit.

He further championed the safety improvements offered by a modern, state-of-the-art hotel, versus the existing 1960s-era motel, as well as the potential for indoor and outdoor pools, recreation facilities and a spa that might be used by the community in the off-season.

And, while it might have a larger footprint, Killmer said the hotel will comply with the zoning code without any variances, would meet or exceed governmental requirements and would recognize the current use of the properties.

“A high-end, upscale, boutique-type hotel may have a positive impact on the neighboring properties,” he argued, “and it can at least be said that it would not have a negative impact.”

Those arguments met with agreement from Healy and Dorfman, who also voted in favor of creating the CL-1 zone.

McClenny noted commercial lodging’s part in the town’s “great appeal as a resort town” and pointed to tourism’s impact on the local economy, as recognized by state and federal government, including through the enhancements to the dune and beach, and improvements to Garfield Parkway. “It will be a comfortable facility to abide in while on vacation,” he concluded.

Gordon, too, voted in favor, arguing that the change would ensure no increased commercial use.

“If this was not involved, we don’t know what would happen on Parcel A,” he said of the currently commercial-zoned parcel on the north side of Hollywood Street, adding that he felt the street itself would be improved as a result of the project and it would cause less congestion “or at least no more than there is,” due to the off-street parking requirement, as well as offering improved safety conditions over the decades-old motel.

Economically, he added, it helps the financial health of the town “by not having a gated community, but inviting the public in, allows us to take advantage of the money offered to us by the state and federal governments.”

Olmstead said she also favored the change to CL-1, noting that, with its position between the existing C-1 and R-1 districts, it “provides a progressive change from residential to commercial. We have previous experience in our town of citizens in our town who own property next to shops and have expressed displeasure with the noise.”

“Certainly, a hotel is better choice for the welfare of our citizens than other commercial establishments that could be there,” she said, adding that it would enhance the town’s business community by encouraging desirable businesses to come into town, and that she believed the provision of at least 100 parking spaces “is a big help” when compared to the possibilities of another commercial use that might encourage people to park on residential streets.

Young favors residential for part of property

Young again expressed her opposition to the zoning change, stating that she favored rezoning some of the Bethany Arms property as CL-1 but opposed the rezoning of the residentially-zoned parcels on the south side of Hollywood Street, which had at one point been zoned as multi-family, medium-density residential prior to the elimination of that subcategory from the town zoning code.

“I would like it to revert to residential,” she said, adding that she felt the use was out of character with the surrounding properties. “This is a family-oriented town, with mostly single-family homes, some condos, a few two- or three-unit apartments and a bed-and-breakfast. The proposed hotel is against the tradition of Bethany as a family resort,” she continued. “There is nothing family about the proposed national chain hotel. It does not preserve the value of the buildings in the town, especially in the immediate area. No one will want to buy a home facing a wall totally devoid of light, air and a view.”

The council again voted 6-1 in favor of creating the CL-1 zone, with Young again the sole opposing vote.

Council moves to retain town’s hotel facilities

Finally, the council took up the ordinance rezoning the Bethany Arms property and Lot 12 from their various C-1 and R-1 zoning to be all CL-1.

Killmer and Healy reiterated their previously stated reasons for favoring the rezoning, while Dorfman also took the chance to look back at the recent history of the town’s commercial lodging.

“I want to remind everyone that when the Blue Surf left, we lost 33 units. If the Bethany Arms is sold and the zoning remains the same, there will be stores there, maybe a big Sunsations — though that may be conjecture,” he acknowledged. “Traditionally, this town, almost from its inception, has had hotels. We have had many hotels here,” he added, noting that another hotel had existed on the Bethany Arms property previously, until it was destroyed in a storm.

“The 56 units on the south side carry an awful lot of people. Those are big apartments there,” he continued. “There are quite a few people who had an opportunity to be able to stay in Bethany Beach in a hotel in those units. If the Bethany Arms is removed and stores came in, there would not be a hotel in the confines of Bethany Beach,” he emphasized.

McClenny also voted in favor of the rezoning, noting the voter response to the non-binding referendum the Town had conducted in the prior weeks, with a 71-29 split in favor of the creation of the CL-1 zone and rezoning.

“I’m compelled to support the 70 percent of referendum voters who voted in favor of rezoning this property,” McClenny said, also referencing the PLUS comments and that the property had been used for 60 years as lodging.

He further said he believed that retaining commercial zoning of the existing C-1 parcel meant “parking would be nightmare, with crowds and noise on the street,” but that the CL-1 zoning would bring “tremendous enhancements to parking … whereas retail stores have no such requirement.” He praised the potential for a sidewalk being added to the south side of Hollywood and enhancements being made to the entrance to the boardwalk and beach at Hollywood.

“This will provide housing for visitors, enhance our economy and offer residents alternative living space in times of need,” he concluded.

Gordon debated whether the proposed hotel would result in a loss of air and light in that area, as Young had suggested, saying, “If we don’t go ahead with the CL zoning, the commercial side could be just about anything,” with no parking required. “I believe the design review process will take care of it being a decent, airy place, and it will look not substantially different than it does now.

“It will be good for health and safety by bringing funds to us that we wouldn’t get if weren’t providing for the public, as opposed to just people who are residents of the town,” he noted. “We have a public beach, and tourism is a very important thing in this state.”

Olmstead echoed the earlier comments, noting that the zoning was in agreement with the revised comprehensive plan and had State approval. “It’s also true that we have the support of the vast majority of our citizens who responded to the referendum,” she added.

Young again stated that she had no objection “to a small tasteful hotel on the north side. What I object to is rezoning the south side as CL-1,” she concluded.

The council’s 6-1 vote again supported the new zoning.

While McClenny offered his thanks to those who had put their time and effort into the process, Walton — who handles zoning matters for a number of municipalities — labeled the discussion “by far the most considered, thoughtful and reasoned statements I have seen on the record. You should be very proud of yourselves for thinking very diligently and carefully about this,” he said.

Hotel could be open for summer of 2014

The adoption of the zoning ordinances last week opens the way for the redevelopment of the property to begin. Burbage, who has had a contract to purchase the Bethany Arms property since 2012, may now move ahead to the preliminary planning approval process through the town’s building inspector and Planning Commission and eventual review of the hotel’s exterior design by the town’s Design Review Committee.

Back in January, when Burbage first introduced the proposal to the town council, he said his hope was to demolish the existing Bethany Arms structures in October 2013 and to have the new hotel open by the summer of 2014.

“That’s very aggressive,” he acknowledged at that time, “but we’re currently building a Marriot in Chincoteague that will be open in June, and we started the first of December.”

The 92-room Fairfield Inn & Suites by Marriott in Chincoteague officially opened in mid-July and operates as a Marriott franchise, managed by Real Hospitality Group of Ocean City, Md., whom Burbage had told Bethany officials he hoped would be running the Bethany hotel.

“They really know how to manage the hotel, how it should be done right. We’re going to make sure it’s managed right,” he assured the council in January.