Rehoboth to set hearing on restaurant ordinance

The Rehoboth Beach commissioners will set a public hearing date at their Friday, Sept. 16 meeting on new regulations for brewpubs and restaurants.

The new restaurant ordinance will change square-footage requirements for restaurants that serve alcohol. After months of back-and-forth discussions on changes to the current ordinance’s 5,000 square feet of allowable space, the commissioners have decided to allow 2,500 square feet of permanent seated dining and bar area. The new law would also restrict bar space in restaurants serving alcohol to no more than 25 percent of the permanent seated dining area. The bar cannot exceed 500 square feet, but there is no limit on storage or kitchen space. Existing restaurants will be grandfathered in.

Regulations defining brewpubs were finalized after a meeting between city officials and Dogfish Head, the only brewpub in town. As a result of the meeting, the new ordinance will limit brewpub production to 4,000 barrels - or 124,000 gallons - of beer in a calendar year and will allow beer kegs to be stored outside the restaurant only if screened by a fence or plantings. The screened storage area cannot be in the setback, and raw brewing materials cannot be stored outside.The ordinance outlaws microbreweries or craft distilleries, facilities that are used for tastings but do not serve food.

Mayor Sam Cooper said the city’s proposal limiting beer production at a brewpub is in keeping with state liquor laws but allows the city flexibility to make changes if necessary. Outdoor storage of kegs has been a bone of contention throughout the discussion, as Dogfish contends outlawing the practice unfairly targets only Dogfish. Cooper said the language on kegs is similar to city regulations on trash.

Shauna Barnes, attorney for Dogfish, said the company supports the ordinance, and she thanked the commissioners for their work.

Commissioners Stan Mills and Lorraine Zellers said the proposed changes give restaurants more flexibility. Commissioner Paul Kuhns suggested a 7,500-square-feet total area limit, with no more than 50 percent of the restaurant devoted to permanent seated dining area. Mills said he did not support Kuhns’ suggestion, and the proposal was quickly dropped.

Planning Commissioner Jan Konesey, a former city commissioner, objected to the proposed change, saying the 5,000-square-foot limitation has served the city well for 25 years.

“It’s worked. We’ve become a restaurant destination town. People come here for the restaurants. We have these boutique restaurants. It makes us unique. We don’t have Chili’s and Arby’s lined up down the street. The restaurants are in scale with the size of the town we have,” she said.

Bill Shields, owner of Aqua Grill, said too much regulation could have the effect of hurting businesses and keeping people away. He said business in town is down and people are not coming to Rehoboth, preferring easy parking at restaurants on Route 1.

“I see things changing. I don’t want to see a dying city,” Shields said.

In response, former Commissioner Walter Brittingham quipped, “It’s a crying shame nobody came to Rehoboth this summer.”

Previously decided elements of the ordinance include requiring a supplemental permit of compliance for patios and brewpubs, allowing no more than 50 percent of a brewpub’s total gross floor area to be used for brewing and confining all brewing activity inside a building.