Odds are, you've never shopped at CC Restaurant Supply.
Though it's in a Palo Alto "neighborhood commercial" zone, which is designed for restaurants, small offices and retail establishments that service the immediate neighborhood, it's not exactly a magnet for residents living in the Ventura area.
Despite its location along El Camino Real, one of Palo Alto's busiest commercial arteries, it is largely obscure from the outside world. A vehicle cruising north on El Camino sees only darkness inside, punctuated by partially open blinds. A pedestrian peering in through the blinds can see only a tiny fraction of the store's inventory — a meat slicer here, a coffee grinder there, a wicker basket of silverware.
You can, of course, get a better sense of what CC offers if you go in when the store is open. That's when you see a small room with shelves stocked with flavoring syrups, coffee filters, boxes of Ziplock bags, a display can of Diet Coke next to a display bottle of Orangina, and then an open door leading to a much larger room filled with crates, metal shelves, pots, pans, boxes and bulk supplies.
But buyer beware: The opportunity to shop here doesn't knock all that often. Its hours are from 8 to 9:30 a.m. on Tuesdays and Wednesdays and from 8:30 to 10 a.m. on Thursdays.
The business may not be widely known to the general public, but Palo Alto's code-enforcement officers have been regular visitors. They began to investigate CC Restaurant Supply for a possible zoning-code violation in the fall of 2015, after a resident filed a complaint and submitted photos showing a van with a Coupa Cafe logo regularly leaving the site in the morning hours. The van's comings and goings, coupled with the fact that CC Restaurant Supply and Coupa have the same owner, fostered the impression that the building was being used as an illegal warehouse for the cafe business. In October of that year, code enforcement notified the building owner of the complaint and informed him that warehouses are illegal in a neighborhood commercial (known as CN) zone.
The following January, after some back and forth with the building owner, Chief Planning Official Amy French and James Stephens, the city's lead code-enforcement officer, visited and found some irregularities, which French detailed in a letter to Winter Dellenbach, the resident who filed the complaint. French said she and Stephens had "witnessed the blocked storefront windows, (a) makeshift sign with a bogus phone number for 'sales by appointment' and (a) padlocked, fenced parking lot at rear."
French noted in an email, which the Weekly obtained through a Public Records Act request, that she called the number and "was dismayed that there was no recognition of any restaurant supply business." Given that earlier in the month, CC's owner, Jean Paul Coupal, had applied for and received a new "use and occupancy permit" that listed the business as an "extensive retail" operation, this struck the city as unusual. (The permit approval process involves both the fire department and building division, who check for safety and to "ensure that zoning regulations are being followed," according to the city.)
"We agree the operations there do not live up to the 'extensive retail' land use the business claimed on the Use and Occupancy Permit that was issued at the Development Center on Jan. 29," French wrote. "An 'extensive retail' store would need to have hours of operation open to the general public."
In the months after that visit, code enforcers continued to pop in for inspections. They determined that CC was conducting retail during its very limited hours of operations, and they compelled the business to change its window displays to allow more visibility.
But to the public at large, little changed. The Coupa vans continued to come on a regular basis. In April 2016, City Councilwoman Karen Holman reached out to city staff to inquire about what was happening at 3457 El Camino Real.
"This is a very long time to have a non-compliant use (and windows) in a street-facing CN-zoned El Camino location," Holman wrote. "Coupa is a desirable and popular cafe in the community, but that should not exempt them from being a good neighbor in non-cafe locales."
Dellenbach sees this property and others like it (she has an extensive list) as indicative of a troubling Palo Alto trend: the death of neighborhood-serving businesses. Buildings in south Palo Alto that were once occupied by veterinarians and dry cleaners have been taken over by headquarters for local tech companies, multi-national corporations and support operations for other businesses. As a result, once-walkable neighborhoods are no longer so, she said.
"We treasure our retail stores — not just retail but things like medical services and physical therapy — that really offer actual valuable services to locals in the neighborhood," Dellenbach said.
So when she saw the blinds shutter on the CC building — formerly occupied by Quality Discount Tile — and a paper "sales by appointment" sign go up on a door, she decided to take action.
"It offended me because it was certainly not in the spirit of the law and not in the letter of the law," Dellenbach said.
Another example of high-tech businesses taking over neighborhood-retail sites occurred earlier this year, according to Dellenbach. A tech company called InnoSpring, which provides services to startups, received a permit to move into the 3400 block of El Camino, where previously there was a medical office.
Both Holman and Dellenbach see these kinds of situations as symptoms of a broader regulatory problem in Palo Alto: The city's code enforcement is chronically lax. City officials, despite initial misgivings, didn't institute any penalties against CC Restaurant Supply before closing the case last summer. All they did was require that the store modify the display area and hold regular hours of operation. Because the municipal code does not specify what those hours should be, five hours per week sufficed.
From the perspective of code-enforcement, the resolution of this case was a success story. The city worked with Coupal to address residents' immediate concerns and, after the requested modifications were made, determined that the store complied with city code.
"You can walk in there, and I've actually seen people from other businesses in there, getting some cups or other things," Stephens said. "It's not as convenient as Costco — the hours aren't nearly as user-friendly — but it's a matter of 'spirit of the law' versus 'letter of the law.' Until we get some other issue where it can be enforced, they are legally operating within the confines of the municipal code."
Dellenbach, who has called CC Restaurant Supply a "charade" and a "farce" and who referred to its retails hours as "lipstick on a pig," saw things differently.
"To say that this retail site is anything but an illegal warehouse is to insult the people in the two neighborhoods," Dellenbach said in referring to Ventura and Barron Park.
Not making the grade
For a team that consists of just three people, Palo Alto's code enforcers have been facing an unprecedented level of public scrutiny of late. In January, the council received the latest National Citizens Survey that showed a troubling trend: only 52 percent of the respondents rated Palo Alto code enforcement as "good" or "excellent" in 2016, down from 59 percent in 2015 and 62 percent in 2014.
The results have prompted some head-scratching among city officials. City Auditor Harriet Richardson, who coordinates the national survey under a contract with the National Research Center, noted in the report that many respondents who rated the quality of code enforcement as "fair" or "poor" had not actually observed any code violations.
There's also some confusion about what exactly people are upset about. Is it construction noise and overgrown weeds? Is it hacker houses and Airbnb rentals in residential neighborhoods? Is it unenforced (and thus non-existent) "public benefits" from approved development projects and businesses that don't conform with zoning laws?
The term "code enforcement" seems to be at least somewhat correlated to residents' broader frustrations about development and its impact. It is perhaps no coincidence that only 37 percent of the residents in the National Citizens Survey gave "good" or "excellent" ratings to the city on "land use, planning and zoning" in 2016; down from 50 percent in 2006.
Now the city is trying to solve the riddle. In May, when the council's Finance Committee was reviewing the planning-department budget, members agreed to spend $20,000 on a supplemental survey to help the department figure out ways to improve code enforcement. As added incentive, the council on June 27 set an ambitious goal when it approved the city's 2017-18 budget: Get the percentage of residents who give code enforcement "good" or "excellent" ratings to 70 percent.
One action that might help: Richardson is preparing to conduct an audit of code enforcement, whose three officers earn a combined $315,592 annually. She said she decided to do an audit after fielding complaints about everything from illegal signage to garbage cans in the public's right-of-way.
"I had council members ask me about doing a code-enforcement audit, and I've had residents come to me to ask me if it was possible to do an audit," Richardson said. "When you have a lot of interest all the way around, you realize, 'We probably need to do an audit.'"
Strikingly, the program's plummeting survey scores came at a time when Planning Director Hillary Gitelman's department was making an effort to strengthen it. With the addition of Stephens in early 2016, the department began to enforce the city's long-languishing ban on gas-powered leaf blowers. Between 2011 and 2015, the number of formal warnings and citations that the city had issued fluctuated between zero and one. Last year, the department investigated about 400 complaints and issued about 250 notices and seven citations, according to the city budget.
Code enforcement also has been fielding more cases and resolving them more quickly, according to department data. Its 723 cases in fiscal year 2016 (which ended on June 30, 2016) was the highest total in at least a decade. Furthermore, 97 percent were solved within 120 days, a greater share than in any other year (in 2015, it was 91 percent).
Hoping to build on that progress, this year Gitelman made a pitch to add another code-enforcement position. That proposal, however, was vetoed by City Manager James Keene during the budget process.
For the most part, Palo Alto's code enforcers have tended to err on the side of caution. The last thing Stephens wants, he said, is for the city to end up on the losing end of a court battle stemming from a lawsuit filed by an aggrieved violator.
"You can't just be slapping things together (to substantiate a violation)," he told the Weekly. "You have to be able to document and prove your case, not beyond reasonable doubt but with a preponderance of evidence, that this person is in violation.
"Without a preponderance of evidence, it's a false accusation that I cannot uphold under scrutiny," he said.
Even a stack of photos of a van, labeled with the Coupa logo, coming and going from the back of CC Restaurant Supply, isn't enough to prove anything.
"Just because the Coupa van is there doesn't mean it's a warehouse," he said. "They may actually be bringing supplies to sell. They actually do refurbish equipment to sell it."
Fewer than 5 percent of the hundreds of cases code enforcement investigates every year lead to fines, according to staff. As long as the business owner is willing to work with the city, Stephens said, the city wants to work with the owner. Voluntary compliance is both the desired goal and the usual outcome.
Though the city collected $514,728 in citations in fiscal year 2017 (which ended on June 30), the lion's share — $430,250 — came from a high-profile case violation at the recently redeveloped Edgewood Plaza.
"I want to build that relationship with you to help you gain compliance and maybe, if you need assistance, turn you toward the right local program that may be able to help you," Stephens said.
But for many in the community — and some on the council — this gentle approach only fuels the abuse. Holman said she often hears from the public that code enforcement is "slow to act." On May 9, as the Finance Committee reviewed the planning department budget, Holman complained about the department's alleged aversion to fining violators — a practice that only encourages recidivism. She called code enforcement "one of the largest things that people complain about in public."
"Of course you always want to get compliance first," Holman said. "But there seems to be a culture where we don't charge penalties or fines, even when there is recidivism."
Holman told the Weekly that when it comes to illegal use of space, she isn't even sure that the city has any enforcement at all. When the city finally nudges someone into compliance, that person quite often reverts to illegal behavior once code enforcement stops paying attention.
"When violations are allowed to continue, and without penalty, it leaves a decided impression that the violators have higher standing than the rest of us," Holman said.
Innovation — or violation?
When confronted with a coding violation, some residents complain to council; some file online reports through the city's 3-1-1 portal; others opt for a good, old-fashioned "Gotcha!" moment.
In May, Midtown resident Soudy Khan chose the third option when he walked into a restaurant on Middlefield Road and found cubicles and computer stations set up all around the shop's periphery. In the middle of the room, a set of blueprints rested on a table.
"This is basically an office!" he exclaimed.
Khan quickly found out that the business, Gracie Jones' GF Bake Shop, does in fact serve food, which one can order at a counter in the back. At one point, just before an employee called the police because Khan was video-recording the encounter, he ordered some chicken and rice.
The business at 2706 Middlefield occupies the former site of Palo Alto Breakfast House. But unlike the prior tenant, Gracie Jones' does more than serve food; it also has doubled as a corporate office for Asian Box, an expanding chain with a popular location in the Town & Country Village shopping center.
Frank Klein, CEO of Asian Box, told Khan that the Midtown venue is still a retail operation, with gluten-free cookies and doughnuts available to customers. Legally, he added as he picked up a bottle of Coke in one hand and a bottle of Sprite in another, "All we have to do is sell these two items" to comply with zoning.
"You are so bothered by the fact that we happen to have a unique hybrid system of a corporate office, catering kitchen and a retail location, and it really bothers you that we have everything combined in one," Klein told Khan.
In late May, Palo Alto's code-enforcement officers received a complaint about Gracie Jones' and began to investigate two days later. On June 13, Code Enforcement Officer Brian Reynolds sent an email to Klein requesting a new floor plan with fewer work stations and more customer seating. (The only seating had been stools at the counter.)
When asked about Gracie Jones', Stephens said that its use is "technically legal," despite the zoning code's prohibition on "general business office use (other than neighborhood-serving travel agencies and insurance agencies)" in the Midtown Shopping Center. The work stations, Stephens said, aren't an office per se. They are also a place for customers to place large food orders (Asian Box provides catering services to area businesses).
Code enforcement did, however, find one violation: The restaurant did not have enough interior seating, which effectively rendered the business takeout only.
"That takeout aspect is prohibited in the CN (neighborhood-commercial) zone," Stephens told the Weekly. "It can't be your primary business."
The problem, like most in Palo Alto, was resolved without formal letters announcing violations or citations. Instead, Stephens relied on his preferred method: talking to the business owner, explaining what needs to be done and following up as needed. Two weeks after Reynolds' June 13 letter, code enforcement sent another email requesting a status of the floor plan, which was submitted later that day.
When asked about the zoning dispute, Klein said there was some confusion about land use. The business, he said, "wanted to slowly ramp up our bakery and test products out of the kitchen and also service several Asian Box Stores from the location. And have a work space."
Since the investigation, the business has morphed into what Klein described as a "community-type center where seniors are using our computers and printers and also ordering baked goods" — in other words, a neighborhood-serving business of the sort that the CN zoning is meant to accommodate.
"We have desks in the space, which for some is obviously tough to wrap their head around because they are hell bent on this one-size-fits-all notion of evil techies taking over Palo Alto," Klein wrote. "That may be happening, but it ain't us."
"And who is to say what the interior space should look like?" he said, rhetorically.
Improving the system
For Palo Alto to take a harder stance toward repeat violators, as both Holman and Dellenbach said they would like to see, the city will have to take several steps.
For starters, the municipal code needs to be revised to give enforcers more power to issue a fine earlier in the process.
Another must, Dellenbach said, is that senior staff in the planning department should interpret the code in a way that keeps residents' interests in mind.
Dellenbach, who has spent years tracking "planned community" (PC) projects (in which the city grants zoning concessions in exchange for negotiated "public benefits") and developers' violations of their agreements, said she believes code-enforcement officers are generally diligent in investigating complaints. The problem comes when "higher-up staff interprets codes in such a way that they too often seem to default to interests that frankly seem to betray the very interests that these zoning codes were written to benefit."
InnoSpring, which caters to tech startups rather than to the surrounding neighborhood, is a perfect example, she said.
"Residents have a real stake in seeing that our codes — particularly zoning codes that affect residents and that have to do with services and benefits that go to residents — get enforced," Dellenbach said.
It remains to be seen whether the council revises the zoning code to make code enforcement more strict. But even if it doesn't, planning staff believe the city can take other steps to curtail some of the issues.
In February, the council passed an ordinance that requires retail use on the ground floor in every commercial district. It also includes a provision that retail be open to the public "during typical business hours" — a detail that will prevent future businesses from adopting the CC Restaurant Supply schedule. It will not, however, require CC Restaurant to adopt longer hours; Stephens said the city attorney's office had determined that the existing business is grandfathered in under prior rules.
Gitelman said that in addition to allowing code enforcement to issue fines at a faster pace for repeat offenders, the city can be more explicit in detailing penalties and enforcement mechanisms in its conditions of approval — that is, writing them "with the intention of how enforcement would be most effective."
"It would be difficult to go back and enforce some of the ways some of the old PC agreements were written," Gitelman said. "Prospectively, going forward, we can make an effort to be better about writing conditions of approval with enforcement in mind and writing ordinances with enforcement in mind."
Another area in which Dellenbach believes code enforcement has room for improvement is communication, which could materially affect the success of the whole operation. The 3-1-1 website and app, which Stephens said generates 60 to 70 percent of his cases, has given residents a quick way to flag a zoning violation or a neighborhood nuisance such as graffiti or demolition debris.
But when enforcement officers haven't closed the loop — updating the complainant on the case — the convenient system has left some users feeling less connected. Khan, for instance, never heard back from code enforcement about his Asian Box complaint; without follow-up anyone can reasonably — and inaccurately — conclude that nothing was done.
Dellenbach said the 3-1-1 system, introduced as a way to boost transparency and efficiency, can paradoxically discourage complaints as much as it encourages them.
"People need to know that the city depends on us residents to make the system of code-enforcement work," Dellenbach said. "The city needs to do all it can to encourage citizens to file complaints."
Even Stephens acknowledges the gap in communication.
"Oftentimes, someone may not see the effective change, but the process is going on," Stephens said. "But the feedback we get is, 'Oh, I've called code enforcement and nothing is going on.' Not everyone is privy to the back-door discussions and what's going on."
Yet the system also has its benefits. In December, code enforcement received a complaint on 3-1-1 about a phenomenon familiar to any fan of HBO's "Silicon Valley": the illegal conversion of a residence into a high-tech office. Downtown resident John Guislin filed the complaint after he observed a relocation van moving office furniture into a home on Waverley Street, near Hawthorne Avenue. His suspicions solidified when four identical vehicles with the name of the company, Reali, began to park outside the two-unit property.
Upon receiving a complaint through 3-1-1 and a direct email, Code Enforcement Officer Judy Glaes inspected the home and confirmed it was being used illegally as an office.
In February, she notified the out-of-state property owner that the business and the parking of Reali cars must cease and desist by no later than March 23. She also emailed Guislin to update him about her action.
Then, on March 24, she followed up with another email to Guislin.
"Violations abated! Both units are empty, locks were being changed while I was there," Glaes wrote.
On closer inspection
In the world of code enforcement, cases that have been closed don't necessarily stay closed.
On July 5, code-enforcement staff conducted another inspection of CC Restaurant Supply. An inspector saw that the doors were locked, the parking area was fenced off and a piece of paper on the building requested customers to "knock on door."
Coupal, owner of CC Restaurant Supply and Coupa Cafe, has categorically denied accusations that the El Camino business is being used for anything but retail. When asked about the Coupa vans last week, he wrote in an email to the Weekly that CC Restaurant Supply "sometimes uses Coupa vans," even though they are separate companies.
"We hope to purchase a van for CCRS in the future," he wrote.
He also noted that there is very little foot traffic on El Camino, which is why the store hours are so limited. Most customers, he said, order through email or by appointment.
"The hours open to the public are to provide the option of a spontaneous walk in, but labor costs do not get compensated with walk-ins," Coupal wrote. "We tried extended hours in the past but it was not cost effective."
But Stephens last week took issue with the explanations. On July 7, following the inspection, he issued Coupal a notice of violation. The letter explained that "wholesale" retail is considered by code to be a "warehouse and distribution use," and therefore the work of CC Restaurant Supply is inconsistent with the "extensive retail use" that Coupal had stated on the Certificate of Occupancy form that he submitted to the city in January 2016.
The letter noted that the city's chief building official may "suspend or revoke" the certificate if it was issued in error, was based on incorrect information or relates to a building that is "in violation of any ordinance or regulation or provision of the building code."
The second and third findings, Stephens wrote, apply in this case.
"The City of Palo Alto has been very patient with your business model, accepting your intention to function as a retail business, but this is no longer believable based on our recent inspection," the letter states. "If you wish to continue with the current business model, the business will need to be relocated."
The letter also states that Coupal can prevent further enforcement action by increasing and maintaining "open to the public" hours, keeping all doors, gates and required exits open and removing any signage requiring the public to knock.
Failure to correct these violations by July 28, Stephens wrote, could lead to an order to vacate the building, citations ($500 on the first day; $750 for the second day; and $1,000 per day each day thereafter) or "other remedies provided by law."
At last, the city had its preponderance of evidence. And Dellenbach had a moment of vindication after many months of frustration.
"I'm very happy, and I congratulate code enforcement and the city for finding CC Restaurant Supply to be in blatant violation of our zoning codes," Dellenbach said Wednesday. "However, it is stunning that it is happening nearly two years after my code-enforcement complaint was filed and that in the interim virtually nothing has changed but for a slight reduction in its already minimal retail hours."
Code enforcement officers deal with all the most vexing issues of the day — zoning violations, gas-powered leaf blowers, too much construction noise, etc. — and are often seen by residents as the last line of defense in resolving problems.
More than perhaps any other City Hall program, code enforcement is a custom-built operation that mirrors its community.
Weekly journalists Anna Medina, Gennady Sheyner and Linda Taaffe break down how code enforcement works in Palo Alto and discuss what the city is doing to strengthen it.