El Cajon planning commission gives prospective new owners 90 days to pursue amended permit for Palms Restaurant

The El Cajon Planning Commission on Thursday voted unanimously to continue for 90 days a revocation hearing for the Palms Restaurant and Banquet Hall (CUP 2115) and directed the prospective new operators to file an amendment to the conditional use permit and work with city staff.

The move preserves the existing CUP — including the restaurant's authorization for on-sale alcohol, live entertainment and banquet use — while staff and the applicants prepare a written amendment the commission can review. Commissioner Rose made the motion to continue; Commissioner Sotile seconded and the motion passed by unanimous vote of members present.

Staff had opened the hearing by recommending revocation after a year-long review prompted by complaints and multiple inspections that found the business was not operating as a publicly accessible restaurant. The staff report said the original CUP approval envisioned the property acting as an active downtown restaurant, and that ongoing private-event use, a rear entrance, and recurring code complaints had undermined downtown vitality. Staff noted revoking the CUP would remove alcohol sales and live entertainment from the site but would not bar a restaurant from operating there under other permits.

Representatives for a prospective operator, RM Inc., told the commission they assumed operational control in late March and provided photos, draft menus and sales receipts from the first week. Vince Catulla, who represented the prospective owners, said the new operator had already implemented changes at the Main Street entrance and added a hostess podium and plants. "A restaurant is not gonna survive here without alcohol sales," Catulla said, arguing the Palms would need a mix of restaurant and banquet business to be financially viable.

Members of the Downtown El Cajon Business Partners urged revocation. Kathy Zeman, speaking for the downtown organization, said repeated noncompliance had created a “dead frontage” on a prime block and that revocation was needed to attract a responsible operator. "We respectfully but firmly urge the commission to revoke the conditional use permit 2115," Zeman said.

Commission discussion focused on two competing goals: enforcing the existing conditions of approval and avoiding another long-vacant large downtown building. Multiple commissioners said they were inclined to give the new prospective operators a chance, but wanted a clear written plan defining how much of the space would operate as an open restaurant versus reserved for private events, where any partition or divider would be located, and whether the applicant would seek to increase the amount of banquet use currently treated as incidental.

The commission's continuance directs the applicants to work with staff to prepare an amendment to CUP 2115 — including updated floor plans and a business plan describing the frequency and percentage of banquet/private-event use — and return to the commission within 90 days. Staff said an amendment or a new CUP could be heard within about 60–90 days once an application and plans are filed.

The commission took no revocation action tonight; the existing CUP remains in effect while the applicant prepares the amendment and staff prepares a revised package for the commission's review.

A procedural vote earlier in the meeting closed public comment before the final continuance vote. The commission will schedule the follow-up hearing and notify interested parties.