The City Council rejected a request to waive past-due parking fees owed by Kinda Lahaina Broiler restaurant at the Seal Beach agency’s Monday, March 26, meeting.
City staff had advised against waiving the fees.
The owners of the restaurant are in debt and have sold the Old Town landmark.
However, the city would not let escrow close on the business until the $13,100 in past due parking fees were paid.
The restaurant has not paid the fees for 11 years, according to a staff report by Assistant City Manager Sean Crumby.
Mayor Michael Levitt told co-owner David Duran that the council felt for them.
However, he said the council could not waive fees for one business or other businesses would want their parking fees back.
“I’m going to ask the city manager to work with you on a payment plan,” Levitt said.
“I’m afraid you have to pay this,” Levitt said.
Levitt directed staff to start collecting parking fees from businesses that are in arears.
He also told staff to make sure that the Main Street Specific Plan includes options for parking.
Kathy Duran, one of the restaurant’s owners, wrote a letter to the city on March 7, pleading for relief from the parking fee debt.
“Several years ago the in lieu parking fees were discussed by the merchants paying these fees and the fairness of them since it only applied to certain merchants but not the entire city,” Duran wrote.
“After the issue was addressed, the city stopped billing for fees,” Duran wrote.
“Then all of a sudden, without any notice, we were billed for all past years in which the invoices were not sent out,” Duran wrote.
The Duran letter went on to describe the financial impact of the 2006 fire that ultimately closed Kinda Lahaina for 15 months.
The property lease required that the restaurant owners rebuild the structure.
Insurance didn’t cover all the costs, which included bringing the building up to code.
Duran said she paid the contractor weekly and ran out of money.
“I took an equity line loan on my home,” Duran wrote. “My brother-in-law took one out on his as well.”
The Duran letter said the owners also took out a loan on the business itself.
“All of these loans totaled $700,000,” Duran wrote.
Then the economy “crashed,” and business dropped 25 to 40 percent, according to Duran.
She said she started to draw money from her IRA account. Two years later, her life savings were gone.
“We have now been forced to sell the business at way below the market value and our debt load,” Duran wrote. “When all this is over, I will have to file personal bankruptcy.”
“We are in our 60s and 70s and have no more resources,” Duran wrote.
According to Crumby, the city has not waived in lieu parking fees in the past. “Waiver of fees for any individual business affects the city’s ability to provide parking for all of the business and visitors to Main Street Seal Beach,” Crumby wrote.
“Staff does not recommend waiver of these parking-in-lieu fees, but rather enforce payment of these fees prior to allowing closure of escrow for the sale of this business,” Crumby wrote.
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