Bethany to hold non-binding referendum on proposed CL-1 zone

Bethany Beach officials will be mailing out referendum ballots to the town’s citizens in the coming weeks, after town council members voted unanimously at their June 21 meeting to conduct a non-binding referendum on the appropriateness of a Commercial Lodging (CL-1) zone that is proposed to be created and potentially applied to the Bethany Arms property downtown, which is currently zoned partly C-1 Commercial and partly R-1 Residential.

In mid-July, citizens of Bethany Beach can expect to find in their mail a ballot with essentially a yes/no option: Do they consider it appropriate to rezone the Bethany Arms parcels from their C-1 and R-1 zoning to the proposed CL-1 zone, which would come with its own set of requirements, separate from the generally looser regulations of the C-1 zone and the tighter ones in the R-1 zone.

Mayor Tony McClenny said at last Friday’s meeting that, in his discussions with town staff, he had realized that the Town couldn’t proceed with creating any new zoning until after the proposed changes to the comprehensive plan were reviewed by the State’s Preliminary Land-Use Service (PLUS), which often issues recommendations in response.

“We cannot expect a response from PLUS regarding the change to the comprehensive plan until late July or early August,” he noted, which would mean that any formal council action on the creation of the CL-1 zoning or rezoning of the Bethany Arms parcels to CL-1 would have to wait until at least the August council meeting.

“We have time available to us before the council could consider that,” he continued. “We can use that time to inform, advise and solicit input from the total community.”

McClenny said that, upon realizing the timing of the proposal moving forward, he had suggested a non-binding referendum on the issue of rezoning the R-1-zoned lots that currently house two apartment buildings that are rented weekly or seasonally and a second motel building from R-1 to CL-1, as well as changing the C-1 parcel to CL-1.

The mayor acknowledged that there might be some who questioned why the Town would do a mailed referendum in July instead of waiting until the November council elections to have people cast votes in person. His answer was simple.

“During the average council election, less than 900 people participate,” explained McClenny. “This way, we will have 4,700 voters who are informed and asked to provide an opinion. If we’re going to go through the process of a referendum, it makes sense to hear from all who wish to be heard.”

When the ballot goes out — anticipated to be in voters’ hands by July 12, according to Town Manager Cliff Graviet — it will include an informational sheet and a prepaid return envelope, and will be sent to every eligible voter. The ballots would be due back around Aug. 9 or 12, Graviet said, with the town’s election board to count the ballots using the same procedures as for counting absentee ballots.

Councilman Lew Killmer said the referendum was a great idea.

“It’s important for all of us to hear from the entire community,” he said. “As is typical with any controversial subject, typically, we mostly hear from people against the proposal. This will allow us to get a better feeling of the true feeling of the community.”

Councilwoman Margaret Young said she liked the idea of a non-binding referendum, but she questioned the yes/no format of the proposed referendum question regarding the CL-1 zoning for the Bethany Arms lots.

“I would like to include a third option, to rezone the north side as CL-1 and for the south to remain R-1,” she suggested.

But Killmer noted that the existing C-1 zoning for the north portion of the property already permits hotels and motels, “So there’s no need to rezone it to new zoning when it’s already permitted. So what’s the sense in doing that?”

Young said she had thought the discussion was of rezoning the C-1 property to CL-1. Vice-Mayor Jack Gordon confirmed that was the case but emphasized that it was in conjunction with rezoning the R-1 property to CL-1, with all the Bethany Arms parcels proposed to be zoned CL-1 in the end.

Wilbert Powell, one of the Bethany Arms’ owners, said he supported the change of zone for the property to CL-1, though he admitted to having had some trepidation when he first heard of the proposal.

“When I heard you were going to change the C-1 to CL-1, I was worried you were essentially downzoning our property, but when you change the R-1 to CL-1, you are upzoning,” he noted. “I was initially opposed to the downzoning, because that would prevent us from selling our property for stores or other commercial use.” But, he added, with the R-1 property upzoned to CL-1, he could support the overall proposed changes in zoning.

Young’s proposed amendment, to add a referendum vote option to only rezone the C-1 property to CL-1 and leave the rest as R-1, died without a second.

Council members expressed some dissatisfaction with the idea of a referendum but conceded that, in this case, they felt it was the way to go.

“I’m generally opposed to government by referendum, but this is non-binding,” Gordon explained. “It irks me that you elect people to do something and then decide that we’re not here as your representatives to decide things.

“I agree with Lew that, in this case it has been controversial, and it is important enough, and we do want to find out from the entire town,” he continued. “We’ve heard a lot from a small number of people what they think on this issue. It’s good to put out the information, rather than a lot of what I would consider misinformation that goes around on the topic. With the facts laid out, it will allow people who are not generally here to make an informed decision.”

Councilman Jerry Dorfman said he had also seen misinformation about the proposal being spread.

“I was coming out of the Giant this morning, and a gentleman asked me why we were closing Hollywood Street for this hotel,” he reported. “That’s erroneous, but it’s the kind of thing that’s been spreading around.”

Councilman Joseph Healy said he, too, disliked the idea of government by referendum, but he supported a referendum in this case.

“I agree with that perception,” McClenny chimed in on the referendum question. “However, we have the time. This is a major issue in the town, and I’d like to be able to hear from as many people as we can. To me, that’s important.”

Facts, opinions debated

Powell aimed to clear up some of the misinformation about the project. Noting that he is not the sole owner of the property but owns it with his aunt and her children, he said they were not interested in developing the property themselves but expected the property to be sold someday, if not in the near future to developer Jack Burbage.

Powell emphasized that the property is not currently on the market but is under legally executed contract to be sold to Burbage “with settlement delayed due to the circumstances,” he explained, adding that he would like to see the property continue the tradition of housing a family-owned hotel.

Council members clarified some of the issues surrounding the existing zoning in that area, speaking to concerns from opponent John Schmidtlein, who noted that he had moved to his home on Hollywood Street full-time eight years ago after being a seasonal resident for 35 years and that the wings of the proposed hotel would be alongside his family’s path to the beach.

“I’m very concerned. We have young children walking along there. … I’d very much like to see it not happen,” he told the council.

He questioned the benefits of rezoning from C-1 to the proposed CL-1, noting that the CL-1 zone, as proposed, would not require property owners to include commercial use on the first floor, as is now required for all C-1-zoned property.

Killmer pointed out that the owners of the neighboring Blue Surf condominiums and shops hadn’t been purposely restricted by the Town under the revised C-1 zoning requirements but that they had wanted to have shops on the first floor.

“So, the applicant here is giving up shops to put rooms on first floor?” Schmidtlein asked, receiving an affirmative response.

Killmer then explained the idea behind wanting to rezone to CL-1.

“If the R-1 land is rezoned to C-1 and a hotel is not built, we were concerned about having opened it up to any kind of commercial use at all,” he said. “We felt we didn’t want to go that way. It has always been used as commercial lodging,” Killmer emphasized. “This recognizes how it has been used. We would create the commercial lodging zone to allow it to be used for the only thing it’s been used for.”

Resident Jane Richards said she supported the suggestion made by Young, to rezone the C-1 parcel as CL-1 and to leave the R-1 parcels as R-1.

“The perception is people living nearby would prefer commercial lodging instead of commercial,” she said. But, she continued, concerns were that the developers would build on the entire mass of the lot, towering over nearby homes, though the height in that area is limited to 35 feet or 32 feet with a flat roof, and the Blue Surf is already at that maximum height. She said their objections were not to use of the parcels but to building volume.

“And whether it’s a hotel or a senior haven, an assisted living center, it’s the same volume. It makes no difference to me if it’s an arcade or something,” she said. “There are people in town who simply don’t want that property to be anything but residential because it is a natural buffer between the boardwalk and their homes. … It’s the size of it,” she reiterated.

Gordon said those kinds of concerns were why the council wanted to send out the referendum question, to ask citizens whether they think CL-1 is appropriate zoning there or not.

“You’re making it seem like a fait accompli,” she objected. “People don’t know it’s zoned R-1.”

But Killmer emphasized that that fact will be part of the information sent out to referendum voters.

“Many people would say it should remain R-1,” Richards concluded, “because the code says that, when demolished, properties should conform” to the zoning, though the Bethany Arms’ R-1 property had been granted a waiver from that requirement in the past.

Resident David Limroth — who earlier in the meeting had counseled the council members to require an end to solid-surface covering of areas outside the 40 percent maximum lot coverage, including a ban on “permeable” pavers — noted the nearly non-existent setbacks in the C-1 zone.

“They would take the four lots south of Hollywood and cover them 88 percent with a building,” he suggested. “The remaining 12 percent will be hard surface. That will further add to the flooding problem around here, and it should be taken into consideration, unless you’re going to tell them they have to put holes in the roof to let the rain flow out to the street.”

Healy supports ‘managing change in a positive manner’

The council, having voted 7-0 to move forward with the non-binding referendum, then proceeded to delve into the issues of asking the town’s Planning Commission to review related issues and, if supported by the majority of commissioners, to proceed with the next steps of drafting changes to zoning code and the comprehensive plan, to pave the way for the council to vote on whether or not to make the changes.

Healy said that, for him, the issue was a simple one.

“We’ve had hearings. I’ve read the correspondence. I’ve spoken to a wide range of individuals in regard to the Bethany Arms property. I’ve spoken with Jack Burbage and Wilbert Powell, and both of them are very committed — one with the objective to sell his property, the other to develop a quality facility on this property.

“This presents us with the opportunity to support development of a tasteful, quality facility that could be a centerpiece for the town of Bethany Beach for many years in the future,” Healy continued. “The alternative is an unknown development of this property that could leave us with a far less attractive result.

“I believe the Bethany Beach Town Council has the rare opportunity by managing this change to have some degree of control over this redevelopment issue that will have a significant positive impact on our community for decades.

“We’ve been elected by our neighbors to exercise that control and do what is right for Bethany Beach,” he added, noting his adoption in the past of a “simple business philosophy of trying to do the right thing. I believe in each of our hearts we want to do what is right for Bethany Beach. And I believe that creating a CL-1 zone that only allows for the creation of a tasteful lodging facility that complies with all of Bethany Beach’s regulations, and rezoning the north and south parcels to CL-1, is what is best for Bethany Beach.”

Healy said the slate of items on the June 21 council agenda would allow them to move forward and accomplish that, if it was what the majority of the council wanted.

Healy said his reasoning in deciding such a change was best for Bethany Beach was rooted in the town’s past. Quoting Dorfman’s comments from a prior council workshop, he said, “Hotels, lodgings, where someone could stay for a day or a week, have been part of our community heritage since there has been a Bethany Beach.”

Pointing to the oldest town map the Town has in its possession, dated around 1910, Healy noted that the map shows a hotel in the place where the Bethany Arms stands today.

“Believe me — it would not meet any of our ordinances now,” he added. “Storms, fires, redevelopment have left the town with only one hotel. A few years ago, the Bethany Arms’ neighbor was the 35-room Blue Surf Motel. The property on Atlantic, south of Garfield, has been a hotel for over 100 years, and for the last 60 years, the Blue Surf and Bethany Arms provided commercial lodging on that block.”

Noting that one of the property’s neighbors had remarked to him that the Bethany Arms had been a “good neighbor,” Healy said he believed “a tasteful facility would also continue the good-neighbor trend,” and he questioned whether other kinds of commercial development would be a good neighbor.

“We have the opportunity to get a long-term positive result for Bethany Beach,” he added. “Keep in mind … this will give us the opportunity to manage the change that is about to occur in a positive manner.”

Schmidtlein said his opposition to the change was based in the existing comprehensive plan, which references “maintenance of land-use patterns and development character, rather than instigate significant changes … limiting future higher-density development to areas already zoned for this use” and that the “two existing commercial areas should be maintained as such and dramatic intensification of these uses should be discouraged in order to maintain consistency with the low-density character of the town.”

He reminded the council that they had adopted the comprehensive plan with that language in it, and said a change would be unfair to those who had invested in the town with that in mind.

“In this plan, you can’t find the word ‘hotel’ or ‘motel.’ Nobody was thinking about this. This is our 10-year contract. People make decisions about this place, and the next thing we know we’re in an uproar over rezoning.”

Dorfman took the opportunity to remind people of the long-existing commercial use on the residential parcels, asking Powell how long that had been the case.

“As far back as I can figure,” Powell said, noting that apartments had been on the property in 1957 and were rebuilt after they were destroyed in the legendary 1962 storm. Additional property was purchased for parking in the early 1960s, then more for additional lodging and then again for more parking.

“I would make the point that the comprehensive plan has been approved with those residential lots being used for commercial purposes,” Dorfman said.

“It has been a hotel in this town, owned by us or the early families that established the town,” Powell said of the parcels’ history, with Graviet noting that a boarding house had existed on the corner lot as far back as the 1920s. (Young noted that that structure was more appropriately labeled an apartment building with rental units, not a boarding house.)

But Richards said the historic hotels of the town were a different animal than the proposed Burbage project.

“You’re talking about a portfolio of 108 rooms, 54,000 square feet, with an exercise room, indoor and outdoor pool,” she said, also referring to the larger minimum sizes of motel rooms that the Town this spring revised downward to better reflect current industry standards.

She said that the number of rooms would go from 38 to 40 at the Bethany Arms today to 111 as proposed. Stating that Powell had told her he might have up to eight people in a room now, she postulated that might mean up to 888 hotel guests at the new facility.

That elicited a round of laughter from many in the council room, as the calculation didn’t take into account that the 111 new rooms would be substantially smaller than the 800- to 1,000-square-foot rooms in the Bethany Arms today, as well as the existing apartments.

“This is why we need this referendum,” said Gordon, “Eight people in a hotel room; we’re going to close Hollywood — this is all bouncing around the community. It’s about time the community had facts upon which to base a decision and is then asked to make a decision. That’s what people are going to hear: Eight people in a room, 888 people in the hotel. That’s just fallacious.”

Dealing with some of the factual information, Graviet clarified that the total number of beds in the Bethany Arms complex now is 340, which he said is the equivalent of 85 modern hotel rooms. There are 61 parking spaces between the parcels. The proposed Burbage project would include 112 rooms, with 115 parking spaces.

“What doesn’t factor in is the 35 rooms from the old Blue Surf, and both of those existed side by side for a number of years — 115 rooms existed side by side in this quadrant of town for the last 60-plus years,” Graviet emphasized.

The council approved each of the related items on their June 21 agenda on a 7-0 unanimous vote.

That moved them on to the Planning Commission, which began their discussion of the issues at their June 22 meeting, voting unanimously on a set of draft regulations for the proposed CL-1 zone. Those regulations would limit uses in the CL-1 district to commercial lodging, and they also establish regulations on such issues as provision of parking and loading procedures. They are expected to send the changes on to PLUS for review.