Business zoning overhaul approved by key City Council committee

New York City businesses may soon get the flexibility to cut a little loose. A key City Council committee voted 8-2 on Wednesday to approve a zoning overhaul that eases restrictions on where businesses can operate and grow in the city – including doing away with outdated rules that regulate dancing in entertainment venues.

The zoning text amendment, proposed by New York City Mayor Eric Adams’ administration as part of wider zoning overhaul, will head to the full City Council for a vote next month. Republican Council Member Joe Borelli and Democratic Council Member Kamillah Hanks, both representing Staten Island, voted against the proposal in committee.

The City Council has already approved the administration’s City of Yes for Carbon Neutrality, while the City of Yes for Housing Opportunity proposals are at an earlier stage of the public review process.

City of Yes for Economic Opportunity included 18 proposals to update business and manufacturing zoning laws – the first major update since 1961 – all in the name of boosting economic activity and making it easier for business to operate without getting tangled in red tape. The proposed updates include not just reforming the city’s outdated rules governing entertainment venues, but also making it easier to get vacant storefronts filled again, allowing certain kinds of businesses to operate in new areas like upper floors of mixed-use buildings and granting more flexibility for where light “clean” manufacturing can operate.

The council’s passage of the proposal was a rare moment of consensus amid the ongoing power struggle between the City Council and Adams administration. But the administration’s proposal, which was approved in March by the City Planning Commission with some modifications, was still subject to additional modifications by the council out of concerns that some commercial activity could be overly disruptive in residential areas.  Most notably, a proposal to allow corner stores in residential districts was eliminated, while the size of businesses allowed to operate out of homes was capped by square footage and number of staff. The administration’s proposal to allow indoor agriculture in commercial districts was modified to prohibit the cultivation of cannabis in residential districts that allow limited commercial use. A proposal that would make it easier for life sciences research and product development facilities to build and expand in certain commercial districts was limited to Manhattan.

As the Adams administration developed the City of Yes for Economic Opportunity, members of the City Council have also pushed for an overhaul of zoning for manufacturing – an industry that underwent both major contraction and evolution in the past few decades. A broad proposal included in the administration’s plan – at the request of the council – to create a new framework for manufacturing districts and mapping was given more detail in a modification by the council on Wednesday.

Before calling the vote, Land Use Committee Chair Rafael Salamanca Jr. announced that agreements outside of the proposal had also been struck between the administration and City Council, including regulating last-mile delivery facilities with a special permit process, and increasing enforcement and compliance staff at the Department of Buildings and the Office of Nightlife. “During this process, we negotiated a commitment for a special permit to address the issue of last-mile facilities that have swarmed our neighborhoods, and protections for local communities against micro-distribution sites in residential areas,” Salamanca said in a statement. “While it is important to protect our business communities, we cannot overlook the historic environmental justice issues that have plagued our city for far too long.”

In a statement, Mayor Adams praised the committee’s passage and called for passage by the full council. “This historic initiative will remove outdated limitations on businesses and ensure that local retail streets and commercial centers across the city remain lively places that sustain our neighborhoods,” he said. “I want to thank Speaker (Adrienne) Adams and Chairs (Kevin) Riley and Salamanca for their dedication and collaborative effort to make thoughtful modifications that balance public input while maintaining the purpose and intent of the proposal.”