City Manager: ‘We Cannot Regulate Massage Establishments Differently’

“We definitely want business diversity—[that’s] what makes a business community thrive,” City Manager Sergio Gonzalezs told Patch last week when the news first broke that South Pasadena would be getting its 14th massage store in the form of a massage spa franchise called Massage Envy that would be replacing a branch of Out of the Closet on Fair Oaks Avenue.

In a subsequent Q&A with Patch, Gonzalez spoke about the hurdles in dealing with the proliferation of massage stores in the city. Excerpts:

Patch: As the city manager, what’s your view of massage stores in South Pasadena?

Sergio Gonzalez: We want to make sure that we have not too many businesses of one particular nature. There are land use options for cities to designate what kind of [business] can be done in what part of a city. Unfortunately, with the state regulation and no local control at this point [over the massage industry] we cannot regulate massage establishments differently than we would regulate a doctor or a lawyer or an accountant.

There’s a state law that passed a few years ago [in 2009] that prohibits us from doing that—if not, we’d be subject to a lawsuit. So, if we said that we could only have massage establishments on this street of the city, we would have to do the same thing for doctors, lawyers and dentists and all the other professions as identified by the state in the professions code.

So, we really have our hands tied because we want to weed out—or shut down—these establishments that we know are conducting illegal activities. King’s Spa was shut down for a few days. Massage Villa also had their business license suspended. We also had a business license revocation on Mission Street a few years ago from an establishment that was found doing illegal things like prostitution. What the state law that took away our local control does is this: If all the workers at a massage establishments have a state certificate by the California Massage Therapy Council, we cannot regulate that establishment in any way differently than we would other professions.

Now, learning that Out of the Closet is moving and is being taken over by another massage establishment—that raises another concern. You’re looking at Fair Oaks, which has a number of massage establishments already. The other issue is regarding sales tax-generating businesses. These [massage stores] are service professions that do not generate any sales tax. When you go get a massage you don’t pay tax on it—you just pay for whatever amount they’re charging you for whatever the service is. And there’s really not a lot of things to sell at a massage establishment—if you’re buying lotions or shampoos, then yes, that’s a sales tax-generating product you’re paying for.

So, you have service establishments like massage [stores], hair salons and nails salons, which are not the most sales tax-generating businesses. Do they have the right to operate? Absolutely. But we believe that we need to have a balance and the proper mix of businesses.

Patch: What happens when a massage place gets busted?

Gonzalez: What happens is that a lot of times the establishment changes hands. If you fine an establishment that was guilty of prostitution or illicit acts, then it becomes a criminal activity on that actual person [a massage therapist], but not the business. So if we threaten to take the business license away and shut down the place, the business is usually sold to somebody else because the business license runs with the person, not the actual location. 

And that puts us in a difficult position. Even if we do a good job—and keep in mind that we don’t have the resources to do these decoy operations, given that we have a lot of other issues to deal with, such as traffic and property crime—the state is still putting pressure on local communities to keep an eye on these establishments is unfair for local counties and municipalities.