‘This is unjust’: Restaurants sue Miami Beach over crackdown on outdoor dining permits

Two Lincoln Road restaurants have sued the city of Miami Beach over a new law that places enhanced requirements on businesses applying for sidewalk cafe permits.

The Spanish-style restaurants, Tapelia and Ole Ole, are challenging the constitutionality of the law after the city denied their applications for sidewalk cafe permits last week based on past code violations. The restaurants, which currently offer outdoor dining, were among 13 South Beach businesses whose applications to continue operating outdoor tables on the public sidewalk were denied for the upcoming 2022 permit period.

In a lawsuit filed Monday in Miami-Dade Circuit Court, attorneys for Tapelia and Ole Ole argued the new permit review process is “overly vague” and gives City Manager Alina Hudak “unbridled discretion” to deny permit applications based on old violations, bad online reviews or any other considerations Hudak wishes to use.

The overhauled permitting process, approved by the City Commission in March, is a departure from the city’s prior practice of approving “virtually all” cafe permit applications, as a memo from the city attorney once described it. The last time the city denied a cafe permit was in 2018, a city spokeswoman said. Prior to the new law, the application process mostly consisted of submitting site plans and paying off any outstanding fees.

“In reliance on the city’s historical practice, businesses have invested millions of dollars in properties on Lincoln Road with a reasonable expectation that the city will issue a permit upon submitting a compliant application to the city, which had, until recently, required the applicant satisfy clear, unambiguous requirements,” the legal complaint states.

All 13 restaurants whose permits were denied have been ordered to remove their sidewalk cafe tables by next Tuesday, Nov. 30. They cannot appeal the decision and must wait 12 months to reapply for the permit, which is good for one year. Tapelia and Ole Ole are asking a judge to temporarily block the city from enforcing the law until the lawsuit is concluded. If not, they say, the restaurants will be forced to close and more than 100 employees “will be fired in the midst of the holiday season.”

“This is the Thanksgiving gift the city is giving 100 families,” Gabriela Hernandez, a manager who oversees both restaurants, told the Herald. She said about 90% of their revenue is from sidewalk tables, which allow customers to people-watch along the open-air mall.

Miami Beach Chief Deputy City Attorney Robert Rosenwald said in a statement Tuesday that the 13 restaurants denied their permit renewals “were not advancing the mission of the city’s sidewalk cafe program.”

“We are cleaning up our city,” Rosenwald wrote in the statement. “A new annual sidewalk café permit is a privilege that the city gives to its best operators, and the city code invests the city with the discretion to decide which operators are meeting the city’s goals for the sidewalk café program, after considering suggested criteria.”

The permits expired Sept. 30, Rosenwald said.

Tapelia, located at 551 Lincoln Road, has had an active sidewalk cafe permit since opening in 2015, according to the lawsuit. Ole Ole, at 626 Lincoln Road, has been in business since 2020 and has had a sidewalk cafe permit since last year.

About 30 employees of the restaurants protested outside City Hall on Monday as Mayor Dan Gelber and three commissioners were sworn into office following the November elections. They held up banners and chanted, “No to the closure,” while one of the restaurant’s owners went upstairs to ask commissioners to listen to their concerns. The commission did not discuss the issue, which was not on the agenda.

Commissioner Mark Samuelian, who sponsored the legislation that created the new criteria, said after the meeting that while he feels sympathy for the impacted employees, he supports the city’s actions denying the permits.

He noted that the City Commission passed a code of conduct in 2019 requiring business operators to display actual prices for menu items and disclose if gratuity is included in the order. The code of conduct also banned specials boards citywide and soliciting passersby throughout much of South Beach.

At a community meeting Tuesday, Samuelian said bad business practices — like overcharging customers, waving menus in front of pedestrians or having unsanitary conditions — foster a perception of disorder in Miami Beach.

“This bad behavior is feeding an environment that frankly looks chaotic,” he said. “None of this is going to help you attract a mature and diverse audience that we so seek.”

He said that while some business owners have criticized the new policy, the most vocal calls he has received have come from “good operators” who thanked him because they felt like they “were being tarnished” by the bad practices.

“We don’t want to shut businesses down,” he said. “You can’t do it on public land, which is really a privilege, not a right, and we are going to raise the bar on performance on folks that want to make money on public property.”

Violations include hawking, breaking curfew

In letters informing the restaurants of the permit denial, the city administration listed seven violations for Tapelia and five for Ole Ole between February 2020 and September 2021. Those include repeated fines for hawking, or soliciting customers as they walk by the restaurant, a COVID-related curfew violation, two noise violations and two notices of violation for having an overloaded garbage container and putting cardboard boxes near a dumpster.

As part of the new review system, the city administration reviews violations from the preceding 12-month period, assigns points to each violation and then, if two points are accumulated, considers factors like bad online reviews or whether the corporate owner of the business has a history of violations.

The denial letters reference the history of violations that the corporate owner of both restaurants have and concludes that “the nature and gravity of the ongoing habitual conduct and activity ... warrant a denial of its sidewalk cafe permit renewal application.”

Hernandez said the referenced violations are minor and that some — like the sanitation issues — were warnings that did not carry a fine. She said the city administration is unfairly punishing the restaurants in its effort to crack down on Ocean Drive businesses. Nine of the 13 rejected applications came from Ocean Drive businesses.

“We think this is unjust and that they are using our names to justify the cleaning up of Ocean Drive,” she said in Spanish.

Igor Nebola, a manager at Ole Ole who led Monday’s protest, said his restaurant hasn’t had a hawking issue since last year, so he doesn’t understand why the restaurant is being punished now. He said it seems like the policy was enacted on a whim by the new city administration. Hudak was appointed city manager in April.

“We don’t understand why,” he said. “We’re not a nightclub that’s spreading disorder throughout the city. We’re a family business.”

This story was originally published November 23, 2021 at 4:29 PM.

Martin Vassolo

Miami Herald

305-376-2071

Martin Vassolo writes about local government and community news in Miami Beach, Surfside and beyond. He was part of the team that covered the Champlain Towers South building collapse, work that was recognized with a staff Pulitzer Prize for breaking news. He began working for the Herald in 2018 after attending the University of Florida.