MINUTES. CALL TO ORDER: Chairperson Dan Korson called the meeting to order at 7:00 p.m. with the Pledge of Allegiance.

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1 APPROVED LELAND TOWNSHIP PLANNING COMMISSION MEETING Wednesday, December 6, p.m. Leland Township Office 123 N. St. Joseph St., Lake Leelanau, Michigan MINUTES PRESENT: Michael Collins, Skip Telgard, Mary Foster, Jon Stimson, Dan Korson; Zoning Administrator Tim Cypher, Recording Secretary Dana Boomer, Planning Consultant Larry Sullivan ABSENT: None GUESTS: 1; Taylor Simpson CALL TO ORDER: Chairperson Dan Korson called the meeting to order at 7:00 p.m. with the Pledge of Allegiance. AGENDA: Ms. Foster moved to approve the agenda as presented; supported by Mr. Stimson. All in favor, motion carried. DECLARATION OF POTENTIAL CONFLICTS OF INTEREST: None. MINUTES: Mr. Stimson moved to approve the minutes of November 1, 2017, as presented; supported by Ms. Foster. All in favor, motion carried. PUBLIC COMMENT: None REPORT FROM TOWNSHIP BOARD REP: Mr. Collins reported that at the last board meeting, there was discussion of creating a drainage district to address water runoff from Schomburg Rd; Steve Christensen was present from the county. This discussion will continue at future meetings, and the township is interested in pursuing this. The PC briefly discussed the issue. REPORT FROM ZBA REP: The ongoing dimensional variance request that has been previously discussed will have another meeting held. The lawyer for the township s insurance company will be presenting at this meeting. The PC briefly discussed the issue, as the property at issue may also be affected by the drainage district under discussion by the township board. AURORA ZONING AMENDMENT TO SECTION (Microbreweries) Larry Sullivan summarized a memorandum which had been previously distributed to the PC (attached). The intention of Aurora is to sell beer for consumption on premise or growlers to take offpremise for later consumption they do not intend to distribute beer for sale off-premise. Sullivan presented two options for amending the ZO to allow microbreweries and cideries. The first option would allow microbreweries in the Agricultural Conservation District as a special use provided that they is ties in with a winery and/or cidery. This would be placed in a new subsection, Article 10, Section C.20. The second option would amend Section (Wineries) to allow Cideries and Microbreweries. The PC discussed the options, and the interest that Aurora has in beer-making. The acreage needed for the hops needed for a microbrewery was determined to be minimal. Sullivan also brought up that it December 6, 2017 Page 1

2 is unusual for non-resource extraction SUPs to have a two-year sunset, with businesses needing to reapply at the end of that time. The PC discussed Option 1 and changes that would need to be made to make it effective for Aurora and other wineries. Aurora is looking at approximately 150 barrels of beer per year, which would need significantly less than 1 acre of hops to produce. The PC discussed which option is better for the township and the wineries; the PC wants to keep the production of beer tied to agricultural production, as the production of wine is. The PC determined that Option 1 would serve the needs of the commission, the township and Aurora. There are a few changes that will need to be made to tailor this wording to Leland Township. Simpson requested that hops do not need to be grown on the same property as the tasting room, but do need to be grown on land owned, leased or managed by the same owner, either in Leland Township or in Leelanau County. Simpson will be discussing the need for 50% of the hops to be grown on property with production experts. Four acres of land is overkill for the level of production being discussed. The majority of the beer will be consumed on-site. The total annual production will be fairly low. Simpson will send her recommendations for wording and percentages to Cypher within the next two weeks. New wording will be discussed at the January meeting, with a public hearing likely held in February. Korson expressed a concern that Option 1 will lead to a proliferation of sections on individual options, and it may make more sense to add microbreweries into wineries. The PC discussed briefly, and decided to stay with Option 1 for now. The PC discussed the overall market for microbreweries and brew pubs. OTHER BUSINESS: None Planning Commission Comment: The PC discussed the date and time of the January meeting. The January meeting will be scheduled for January 3 rd. The PC will begin reviewing the Master Plan at the January meeting. Election of officers and setting the yearly meeting schedule will be on the agenda for the January meeting. Zoning Administrator Comment: Merry Christmas! Public Comment: None Adjournment: There being no objection, the meeting was adjourned at 8:30. Respectfully Submitted, Dana Boomer, Recording Secretary Date Approved: December 6, 2017 Page 2

3 December 6, 2017 Page 3

4 Memorandum To: Leland Township Planning Commission From: Larry Sullivan, Planning Consultant Re: Breweries associated with Wineries Date: December 6, 2017 Before delving into specific ordinance language, I would like to provide some background information that might assist in the discussions. Hops are a plant that has not been grown in Michigan for a number of years but that is changing with the emergence of Brew Pubs, Micro Breweries and Craft Breweries in Michigan in general and specifically in Northern Michigan. Hops are an integral ingredient in the production of beer but unlike wine and cider which are primarily composed of fruit juices, grapes, cherries, apples and the like, a small percentage of the ingredients used in the production of beer are hops. The bulk of the content of beer consists of water. At the high end, 20% of the content of beer would consist of hops with a more common range being 10 to 15%. Depending upon the type of beer one wishes to produce, the amount of hops used in its production varies substantially. In conversations with individuals that operate micro-breweries and brew pubs, they have stated they use the following amounts of hops in the manufacturing of 100 gallons of beer. Type of Beer Amount of Hops Used Resulting Beer Stout 30 ounces or approx. 2 Lbs. 100 gallons Lager 38 ounces or approx. 2.5 Lbs 100 gallons IPA 80 ounces or 5 Lbs 100 gallons Double IPA 160 ounces or 10 Lbs. 100 gallons For simplicity sake, I am estimating that for a typical batch of beer consumes 3.5 Lbs of hops per 100 gallons of beer. This is based upon my assumption that most of the beer being produced will range between Stout and IPA. The Double IPA tends to be very bitter and thus a significant percentage of the beer drinking population will find that it is too bitter or hoppy for their tastes. Information from Michigan State University publications indicates that a typical acre of hops will produce 1,500 lbs of dried hops per acre. The 1,500 lbs per acre would typically be during the 4 th and 5 th years of production. Years 1 through 3 result in no hops in year one with 1,125 pound in the 3 rd year. Given the way hops are grown, it takes approximately 1.1 acres of land to enable1 acre of hops to be grown with the way the poles and trellises. Based upon an acre of hops producing 1,500 lbs of dried hops and 3.5 lbs of dried hops used to create 100 gallons of beer, one acre of land in hops production would generate 42,860 gallons of beer. Beer production is generally stated in barrels of beer. Sizes of barrels varies but in the beer industry, a barrel is defined as being 31 gallons. Thus the gallons of beer resulting from one acre of hops would be approximately 1,400 barrels of beer. Breweries are classified in three sizes with microbreweries producing not more than 15,000 barrels December 6, 2017 Page 4

5 annually, regional breweries producing between 15,000 and 6,000,000 barrels annually and large breweries producing over 6,000,000 barrels annually. Other common definitions of interest are brew pubs which is defined as a restaurant-brewery that sells 25 percent of its beer on site. A contract brewery is one that produces beer for another company. It is conceivable that a brewery could exist which does not brew any of the beer that it markets. Another definition that is floating around is a craft brewery which creates a majority of its beer in a manner that would be classified as being traditional or innovative. Since I was not at your last meeting and did not hear the presentation by Taylor Simpson, I do not have a perfect understanding as to how much beer they plan on producing nor whether they will be marketing it from their particular location or restricting the sale to on-site consumption, I have opted to fashion my recommendations as to ordinance language in two different ways, both of which require the brewing facility to comply with all applicable local, State and Federal Laws as well as requiring the bulk of the hops used in the production to be sourced from their property in Leland Township. The text highlighted in yellow is proposed new language while the language highlighted in blue is proposed to be deleted. Option 1 This option would be to allow micro-breweries in the Agricultural Conservation District as a special use provided that it is tied in with a winery and or cindery. Amend Article C. Conservations District to include a subsection number 20. Which would read as follows: Article 10, Section C. 20. Microbreweries and tasting rooms Amend Article 16 Standards for Special Land Uses to add a Section which would read as follows: Article 16, Section Microbreweries and tasting rooms A. The following site and developmental requirements shall apply: 1. The microbrewery and tasting room shall be located on the same property upon which the hops are grown. 2. The microbrewery and tasting room shall be under the same ownership as the property upon which it is located. 3. The microbrewery and tasting room shall be located upon a parcel upon which a winery and wine tasting room is located. The beer tasting room shall be contained within the same building as the wine tasting room. 4. A minimum of fifty percent of the hops shall be produced on property owned by the owner of the microbrewery and the associated tasting room. 5. A minimum of 4 acres of land shall be owned and used for the raising of hops used in the production of beer and shall be located in Leland Township. 6. A minimum of percent of the beer produced shall consumed on site. 7. The total annual production from this facility shall not exceed barrels. 8. All provisions of Section shall be complied with. December 6, 2017 Page 5

6 Option 2 Section WINERIES (Amendment ) Wineries, and Cideries, and Micro Breweries are welcomed by Leland Township as appropriate farm activities. All further references to Wineries in this Section shall include Cideries. It is the intent of this section to promote local agriculture production by allowing construction of a winery and /or cidery with tasting room and retail sale of winery and cider products in the agricultural district subject to this ordinance. It is also the intent of this section to encourage the growing of wine fruit and production of wine and cider as an integral component of the rural and agricultural ambiance of Leland Township, and to maintain the viability of fruit farming through value-added processing and direct sales of wine and wine-cider related beverages made from locally grown fruit. Hops are also a desirable agricultural product of Leelanau County in that they assist in diversifying the agricultural base. Microbreweries provide a value added product but due to the small relatively small amounts of agricultural products necessary to produce beer, micro-breweries and their associated tasting rooms are allowed but only in conjunction with either wineries or cideries and their associated tasting rooms. A. Wineries, cideries and related micro-breweries and/or vineyards, with associated on-site tasting rooms in the AC district, are permitted, provided: 1. The winery facility is licensed by the U.S. Treasury, Bureau of Alcohol Tobacco & Firearms; and the Michigan Liquor Control Commission (MLCC), and is in compliance with the regulations of the Michigan Liquor Control Commission, the Michigan Department of Agriculture, and the Michigan Department of Environmental Quality. 2. The winery shall have minimum area planted in fruit maintained pursuant to applicable generally accepted agricultural and management practices (GAAMPs) within Leland Township and within Leelanau County (including the Leland Township acreage) according to the following schedules: Wineries and Cideries Annual production in cases Leland Twp. Acreage Leelanau County acreage (including Leland Township) Up to 4,999 1 acre 1 acre 5,000 to 9,999 3 acres 3 acres 10,000-24,999 4 acres 10 acres 25,000 to 49,999 5 acres 15 acres 50,000 to 99, acres 25 acres 100,000 to 199, acres 50 acres 200,000 or greater 100 acres 200 acres Micro-Breweries Annual production in barrels Leland Twp. Acreage Leelanau County acreage (including Leland Township) Up to 1,382 1 acre 1 acre 1,383 to 2,764 2 acres 2 acres 2,765 to 4,146 3 acres 3 acres 4,147 to 5,528 4 acres 4 acres 5,529 to 6,999 5 acres 10 acres For every additional 1,000 barrels 1 additional 5 additional acres A maximum of 15,000 barrels is allowed per brewery/beer tasting room December 6, 2017 Page 6

7 3. The above-ground portion of any individual building shall not be greater than 20,000 square feet. 4. All winery buildings shall be set back at least 50 feet from any lot line. If the winery buildings are is open to the public, that the buildings shall be set back at least 100 feet from any lot line. To encourage the use of existing buildings, the setback requirements may be reduced to the standards of the applicable district, subject to site plan review. 5. Retail sales and food service are clearly accessory to production of wine, cider and beer. 6. Standards for Wineries Cideries and Micro Breweries: a. Parking shall be provided, per Article 21. b. All lighting shall meet the lighting standards as outlined in Section of the Leland Township Zoning Ordinance. c. All signs shall meet the Sign Standards as outlined in Article 22 of the Leland Township Zoning Ordinance. B. Approval Process for Wineries, Cideries and Micro Breweries: Site Plan Review is required, except a Special Land Use (SLU) approval is required if the total land area covered by buildings and structures used for wine, cider, and/or beer processing, storage, sales, food service and special events exceeds thirty thousand (30,000) square feet. A SLU approval can cover all special events for up to two (2) years, provided the conditions of the special event(s) and associated activities do not exceed that which was approved, and the Zoning Administrator shall have the authority to grant one two-year extension, after which the applicant must reapply for a Planning Commission Site Plan approval to conduct such special events. 1. Special Events and Activities Activities associated with the promotion of agriculture and education may be permitted. Such activities are not by right and are secondary to the agricultural function. Typical activities are wine, cider and/or beer appreciation/education seminars, nonprofit benefits, weddings, beverage wine and catered food events, seasonal natural events (mushroom hunts), vineyard harvest festivals, receptions, parties, picnics, barn dances, educational conferences, and agricultural research. Outside activities must be completed by 11 p.m. unless otherwise authorized by the Planning Commission. These activities may be permitted provided: a. Special events and activities are limited to wineries, cideries and micro-breweries with a minimum parcel size of 20 acres. (Amendment ) b. Parking areas shall be off-road, 40 feet from all lot lines, and appropriately screened from neighboring property. Light sources shall be directed downwards and shielded to prevent light being directed off the premises. c. The operator must have a written statement from the Health Department indicating the maximum number of persons who can be accommodated with existing toilet facilities, and additional portable toilets must be provided for any guests exceeding the aforementioned number. d. Hours of operation shall be reviewed and set as a part of the site plan approval. e. Any music or entertainment provided for the activity must be for background purposes and not a featured item of the activity. Sound amplifiers are permitted as determined in site plan review. f. Special land use must be approved by the Planning Commission following a public hearing. The following information must be provided in addition to information required for special land use approval: 1) Location of temporary toilet facilities, which may be required. 2) A written description of the planned activities including: a) Type of gathering. b) Frequency and number of activities proposed in a calendar year. December 6, 2017 Page 7

8 c) Maximum number of guests for any activity. 2. Additional Site Plan Review Standards: a. The Planning Commission shall review the site plan for conformance with the standards of the zoning district in which it is located; and shall establish that the following standards have been satisfied: 1) The size of the function and the number of expected guests on the property at one time shall be determined at the sole discretion of the Planning Commission based on parcel size, proximity to adjacent neighbors and the ability of the applicant to demonstrate that there will be no adverse impact on the neighbors from the noise, traffic, trespass, light or other impacts deemed relevant by the Planning Commission. 2) There is adequate provision for parking of vehicles so that there is no parking on public roads, and adequate setbacks from adjacent properties are maintained. Temporary parking areas may be approved at the sole discretion of the Planning Commission. 3) The location and amount of time prior to an event for erection of temporary structures which are allowed and time for removal after the event, may be approved at the sole discretion of the Planning Commission. 4) The Planning Commission shall require a planted buffer between adjacent properties and parking or building if it is determined that such a buffer is necessary to avoid adverse impacts on adjacent properties. b. Any activities other than those included in the original approval must obtain a separate additional approval by the Planning Commission. The scope of the additional review will be determined by the Planning Commission at a preliminary hearing. C. Off-Site Wine Tasting Room in a Commercial District associated with a winery, cidery and micro-brewery located in Leelanau County are permitted, provided: 1. The off-site winery tasting room is licensed by the U.S. Treasury, Bureau of Alcohol, Tobacco & Firearms; and the Michigan Liquor Control Commission, and is in compliance with the regulations of the MLCC, the Michigan Department of Agriculture, and the Michigan Department of Environmental Quality. 2. The winery, cidery and or micro-brewery shall own or lease a minimum of four planted acres in Leelanau County of fruit and/or hops maintained pursuant to applicable generally accepted agricultural and management practices (GAAMPs). 3. The winery or cidery shall use a minimum of 25 percent locally grown (from Leelanau County) fruit. A micro-brewery shall use a minimum of 50 percent of it hops from Leland Township. 4. Food service is clearly accessory to retail sale of wine, cider or beer, per MLCC regulations. 5. Standards for off-site winery tasting room: a. Parking shall be provided. b. All lighting shall meet the lighting standards as outlined in Section of the Leland Township Zoning Ordinance. c. All signs shall meet the sign standards as outlined in Article 22 of the Leland Township Zoning Ordinance. 6. Special events are permitted subject to applicable district regulations in the Village Commercial District (C-1). D. Small Gatherings/Events at Wineries, Cideries and or Micro Breweries, (Amendment ): Small gatherings or events for a limited number of people at previously approved or grandfathered wineries, cideries, micro-breweries and/or tasting rooms in the AC, AR or C-1 zoning districts regardless of size, shall be allowed by right, without a separate site plan approval, provided the following conditions are met: 1. Small gatherings or events shall not exceed 100 guests. December 6, 2017 Page 8

9 2. Any outside activity associated with a small gathering/event shall end by 10:30 p.m. 3. Any music or entertainment shall be limited to acoustic or for background purposes, not the featured activity. 4. Adequate parking shall be provided to accommodate the guests of any small gathering/event, and shall be located a minimum of 40 feet from the lot lines and screened from the neighboring property. 5. Any additional lighting shall be directed downward and shielded to prevent light from being directed off the premises. 6. The Winery operator shall obtain a written statement from the health department indicating the maximum number of persons accommodated with the existing toilet facilities, and shall be responsible for providing portable toilets for guests in excess of the stated number for small gatherings or events. 7. The Winery operator shall obtain a written statement from County Road Commission or Michigan Department of Transportation, whichever agency is applicable, regarding the adequacy of the access as related to hosting small gatherings/events. December 6, 2017 Page 9