Committee amends and continues 'District 3 Thrives' rezoning; public testimony sharply divided

The Land Use and Transportation Committee on Oct. 6 adopted amendments to Supervisor Danny Sauter’s District 3 Thrives ordinance and continued the item to Oct. 27 for further consideration. The package would consolidate the North Beach Special Use District (SUD) into the North Beach Neighborhood Commercial District (NCD) and make multiple changes to allowable uses and size limits in North Beach, Polk Street, Pacific Avenue, Nob Hill and Jackson Square.

Sauter said the legislation is intended to make it easier for small businesses to open and expand in District 3 while preserving neighborhood character: "Our legislation, District 3 thrives, seeks to change that," he told the committee, referring to what he described as rules that have kept small businesses from opening in the district. Planning Department staff member Veronica Flores briefed the committee and said the proposal had been before the Planning Commission and the Small Business Commission and that the department had worked on additional amendments in response to outreach.

Public comment was lengthy and split. Supporters, including small-business owners and business-improvement groups, said the code changes would clear barriers that keep storefronts vacant and prevent new entrepreneurs from opening. The owner of Butter and Crumble said she had found a suitable second location but could not open there without the code changes. The Discover Polk Community Benefit District and other business supporters urged the committee to move the legislation forward.

Opponents — including North Beach neighborhood groups, Telegraph Hill Dwellers, the North Beach Tenants Committee, the Jackson Square Historic District Association and other residents — said the changes risk displacing legacy small businesses, would alter the area’s human scale and might lead to higher rents and loss of housing. Several commenters asked for a continuance or for additional studies; the Jackson Square Historic District Association specifically requested environmental review under CEQA, arguing the rezone could lead to indirect physical changes such as construction and more traffic.

Supervisor Sauter presented a set of substantive amendments he said were responsive to concerns. Key changes read into the record include: prioritizing protection of North Beach’s architectural, cultural and historic character; maintaining limits on large medical facilities while allowing small neighborhood-serving medical and dental services as conditional uses up to 3,000 square feet; protections for legacy businesses that prevent replacement of active legacy businesses with non-legacy uses; a storefront-merger framework that allows mergers as conditional uses up to 3,000 square feet (and requires review above that threshold); and retention of conditional-use review and notice requirements rather than blanket permissive changes. The amendments also explicitly preserved formula-retail limits and historic-preservation review language, according to Sauter.

Supervisor Bilal Mahmood moved the committee amendments and to continue the ordinance to Oct. 27 for a committee report and Board referral. The committee recorded three ayes (Melgar, Chen, Mahmood) and the motion passed. Committee members and the sponsor said the continuance would allow time for further discussion with neighborhood groups and provide an updated, amended text for review before a committee vote on Oct. 27.

Votes at a glance: Committee adopted Supervisor Sauter’s amendments and continued the ordinance to Oct. 27 (Melgar: aye; Chen: aye; Mahmood: aye).