Cracking Down on Ocean Drive's "Bad Operators"

Miami Beach Commissioners have had enough of the online reviews of deceptive business practices by a handful of operators on Ocean Drive. The complaints about bait and switch tactics and the lack of clear pricing on food and drink specials resulting in surprise bills of hundreds of dollars are harming the brand, not only of Ocean Drive, but of the entire City, they say.
 
The City cannot control pricing of menu items but it has one major point of leverage – the coveted sidewalk café permits. Most businesses on Ocean Drive have limited indoor seating making the outdoor table service their biggest source of revenue. Any disruption in their ability to operate their sidewalk cafés is a significant hit to the bottom line.
 
Next week, the Commission will consider an ordinance to give the City Manager wider discretion to suspend or revoke sidewalk café permits. As the sidewalk is a City right-of-way, its usage is regulated by the City which issues permits for business operations on the sidewalk. 
 
Commissioner Mark Samuelian is the lead sponsor of the ordinance. He told the Miami Beach Chamber of Commerce Board of Governors this week that there are “so many good operators” on Ocean Drive “but not all of them are”.
 
Of the bad operators, Samuelian said, “They’re flagrant. They’re hurting us and they’re hurting our brand. Tourists are going away and not feeling good.” He noted that visitors who have a good experience might tell a few people but when they have a bad experience, “They will post on Yelp and Trip Advisor, telling a lot of people.”
 
“This has gone on for too long and it’s got to stop,” he said of the deceptive practices. “We’re taking aggressive steps to do so.”
 
The ordinance will do two things, he said: Ensure pricing is clear and shown to customers and give the City Manager “the power to really make change” via the sidewalk café permits. For the most egregious examples, Samuelian said the Manager could revoke an operator’s BTR (business tax receipt or license to operate).
 
Operators are required to disclose pricing, and indicate gratuities and all City, County, and State taxes on a bill now. The proposed ordinance gets more specific, saying the disclosure must be of “actual” pricing, requires the location of pricing be next to individual menu items and that menus must be provided to each sidewalk café patron. “A sidewalk café may not charge a price that is greater than the price displayed or disclosed for any food or drink menu item(s) or food or drink menu special(s),” it states.
 
The proposal would also require operators to “provide sidewalk café patrons with written notice (on each sidewalk café table) of the disclosure requirements … and to advise patrons that violations may be reported to the City's Code Compliance Department”.
 
Violations would incur fines and penalties, and the potential denial of future permits. Specifically:

• First violation: $500 fine.
• Second violation within the preceding 12 months: $750 fine.
• Third violation within the preceding 12 months: Suspension of the sidewalk café permit for one weekend (Saturday and Sunday) and $1,000 fine.
• Fourth violation within the preceding 12 months: Revocation of the sidewalk café permit for the remaining portion of the permit year and $1,250.
• Failure to apply for a permit would result in termination of sidewalk café operations until a permit is applied for and obtained.

 
For egregious operators, the ordinance provides for “enhanced penalties” that “must be imposed by the city manager” including:

• Operators with more than four violations within a permit year will be prohibited from applying for and obtaining a sidewalk café permit for a period of two years.
• For life safety violations, site plan violations, and violations of the pricing and menu disclosures, the City Manager is “authorized to issue an immediate order suspending the sidewalk café permit and operation, and the sidewalk cafe operator must cease operations for at least 24 hours, and until the city manager finds that the violation(s) have been corrected and withdraws the suspension order."
• In addition, for those life safety, site plan violations, and violations of the disclosure requirements, “the city manager shall also be authorized to commence proceedings to revoke the sidewalk café operator's business tax receipt."  

In recent months, the Planning Board has used its limited power over a few of the businesses that are under its authority to put the “bad operators” on notice. In one case, they have suspended the outdoor music permit of a restaurant because that’s their only leverage. The sidewalk café at Il Giardino continues to have food and beverage service and complaints about their tactics are why the Planning Board is withholding use of its music permit, though based on repeated complaints, it doesn’t appear to be impacting the business.
 
At next week’s Commission meeting, the ordinance will be up for first reading with an opportunity for public comment. If it passes, it will then move on to second and final reading. “We think it’s an important step to addressing an issue that, frankly, has been around too long,” Samuelian said.
 
Link to the ordinance
 
Comment at the Commission meeting on Wednesday, January 17 or email Commissioners your thoughts.