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Watsonville
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May 21, 2022

Council sides with restaurant owner in dispute with airport management

WATSONVILLE—The Watsonville City Council granted an appeal filed by a local restaurant owner that sought to overturn a decision from Watsonville Municipal Airport management to deny a lease transfer to a new restaurateur.

Airport Director Rayvon Williams in October of last year told Ella’s at the Airport representatives that a prospective lease assignee, or a new business owner that would take over Ella’s lease following the purchase of the business, was “not acceptable,” and that he would make a recommendation to city leadership to deny the move.

The judgment, according to Williams, was made after reviewing the assignee’s qualifications. Williams says that Chielo Apac, who owns Nancy’s Airport Cafe in Willows, Calif., failed to provide several financial documents, submitted an underwhelming business plan and does not have sufficient experience managing a similar restaurant or adequate “financial strength” to take over the 100 Aviation Way location that has become a community mainstay over the past six years.

A consultant with the Santa Cruz Small Business Development Center (SBDC) hired by airport management also identified similar “red flags” in the documents submitted to the city, Williams said.

But Ella’s representatives, including owner and namesake Ella King, claimed that Williams was abusing his power by denying the assignment and forcing the business owners to hastily sign a new lease agreement.

After a nearly three-hour discussion on the item at Tuesday’s virtual meeting that at times became testy, the City Council voted 4-3 to approve the appeal. The decision means that staff would continue to work with Ella’s representatives on a new lease—King has been on a month-to-month agreement since the last deal expired on Oct. 31, 2021 while the two sides battled over the assignee.

A denial would have meant the City could have moved forward with a request for proposal for prospective restaurateurs interested in the location. It would have also likely resulted in a lawsuit, Ella’s representatives said during their presentation at Tuesday’s meeting.

Before the council voted on the item, Interim City Manager Tamara Vides said that her office hired a separate consultant to again look over Apac’s business application. That consultant’s evaluation was similar to the original SBDC consultant report, which found that although Apac would purchase all of Ella’s assets, the business plan showed the new restaurateur would likely not run the business in the same fashion.

“[The new report] really supports that Apac might have some significant business deficiencies that point out that she may not be likely to succeed in this endeavor, or run the restaurant that King is running right now,” Vides said.

Mayor Ari Parker and councilmembers Francisco “Paco” Estrada and Lowell Hurst voted against the appeal. That trio said that, among other things, Williams did nothing wrong in denying the prospective assignee and that the City should have high standards when selecting the businesses that will occupy its property.

“We are the stewards of this public property on behalf of the City of Watsonville,” Estrada said. “It is our job to make sure that we have the best-qualified people running that property. To have high standards is not a bad thing. To have high standards is a good thing because then we ensure that our investment in that public property will pay dividends to the community.”

Parker agreed with Estrada and added there have been missteps from both sides. Perhaps the biggest, she said, was that the two sides have not agreed on a lease.

“I would have wished [the issue] would have completed itself before it got to us, but that’s what our job is,” Parker said. “It’s not always pretty and it’s not always popular. I love Ella’s food and I love Ella, but in this instance, I’m not going to support [the appeal].”

In explaining their vote for the appeal, councilmembers Eduardo Montesino and Vanessa Quiroz-Carter said that the City should not be the entity that decides whether, or to whom, a business owner can sell their property.

“I don’t think we’re qualified to be making those decisions,” Montesino said. “If [King] signs the lease and the transfer is good, then we move on. If [the new owner] doesn’t make it, then, like everyone says, a lot of small businesses don’t make it. But that’s her decision. It’s not ours.”

Councilman Jimmy Dutra said that he voted for the appeal because he wanted the City to help a local business that, if not allowed to continue its operations, would have laid off its staff, many of whom live in Watsonville. 

“They will not have a job in the middle of Covid. We can’t do this to people,” Dutra said. “That restaurant needs to continue and to transfer on and people need to be able to keep their jobs.”

Tony Nuñez
Managing Editor Tony Nuñez is a longtime member of the Watsonville community who served as Sports Editor for five years before entering his current role in 2019. A Watsonville High, Cabrillo College and San Jose State University alumnus, he covers the city, business, housing, entertainment and more.

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