Monterey City Council makes historic decisions on leasing policies.

Quietly, as St. Patrick’s revelers were downing green beer just a few blocks away, history was made in Monterey last night.

It was years in the making.

Monterey City Council addressed the city’s leasing policies, an issue seen six times by the previous council and twice by the current one. A day before the meeting, longtime Councilmember Libby Downey said, “I think it’s the biggest decision we’ll make in my tenure as a councilwoman.”

The leases have long been contentious for one key reason: the waterfront, which sits above city-owned land, and is home to many businesses that have been there for decades. Many have accused past city councils of giving sweetheart deals to leaseholders on Fisherman's Wharf, several of which are on 50-year leases at below market rate.

Few had any clue how the sitting council would act. Several business owners from the wharf spoke at the meeting, as they have at past meetings, urging council to sympathize with their years-long efforts to turn the wharf into a tourist attraction. In the past, the argument worked.

It did not work last night.

City council passed nearly every one of staff’s 23 recommendations for new lease templates, but the biggest by far was the first one: That all improvements revert to the city when a lease expires. That means that every business on the wharf, when their lease is up, no longer owns their building.

Subleasing was also addressed. In several cases on the wharf, leaseholders with lengthy leases sublease out their property to other businesses at a considerable profit, a practice seen by some as robbing taxpayers of revenue. Staff recommended taking 90 percent of sublease profits, but Councilmember Ed Smith made a motion to soften the language to “a portion of sublease profits.”

Downey was only the voice of dissent.

"You’re subsidizing taxpayers money to others,” she said. “If you’re comfortable giving away taxpayers' money, so be it. I’m not."

Smith’s motion passed 4-1.

The other major decision council made was to limit leases to a length of 3-10 years, considerably shorter than the current decades-long leases on the wharf.

That motion passed 3-2, with Smith and Mayor Clyde Roberson dissenting.

While there are three leases up for renewal on the wharf, others don’t expire until 2021 and 2041, so the effects on the waterfront won’t be immediately apparent, but long-term, the decisions could boost city revenue by the millions per year.

The three leases up for renewal, which are currently month-to-month, are concession 35, which houses Balisteri's, Coffee House, Crepes of Brittany and Paluca Trattoria, concession 7, which is home to Liberty Fish, and concession 18, which Monterey Bay Whale Watching subleases from Chris Arcoleo and Carolyn Mountford.