RICHMOND -- Following the lead of neighboring San Pablo, city officials agreed this week to stop issuing new permits for businesses that give customers cash in exchange for gold jewelry and other valuables for at least 45 days, with an eye toward extending the moratorium to a year.
Senior planner Lina Velasco told the City Council on Tuesday that city staff plans to ask council members in July to extend the moratorium to next June, noting that the city is in the process of updating its zoning ordinances. The council unanimously approved the temporary moratorium.
Velasco said four cash-for-gold businesses operate in the city, and "four or five more have inquired" about obtaining permits.
The planning staff is concerned that the businesses create "visual blight" and other "regulatory challenges" in the city and may contribute to persistently high home burglary rates, Velasco said.
Thieves often swipe gold and other valuables from homes and take them to cash-for-gold shops for cash, she said.
Several council members praised Velasco for proposing the item.
"I support this," Councilwoman Jovanka Beckles said. "I get online and read about neighborhood groups, and I read about someone's house getting broken into every day."
Councilman Jael Myrick said the cash-for-gold businesses are " ... something we clearly see is causing a problem."
But local merchants aren't so sure.
Nabil Mohammed, who for years has worked with his father running Cash Your Gold near Hilltop mall, said businesses like his provide an important service and help police combat burglaries and thefts. Two of the city's gold-buying businesses are at Hilltop.
Mohammed said he doesn't oppose a moratorium on new businesses while the city develops new zoning ordinances but cautions that any attempt to shutter cash-for-gold businesses could backfire.
"If you closed us all down, you drive the market underground, into the streets," Mohammed said. "That would be much worse because they wouldn't follow the safeguards we do, like the way we take identifications and fingerprints and other information and file copies of all our forms with the local police."
Richmond Chamber of Commerce President Judy Morgan said Wednesday she hadn't yet taken a position on the moratorium but planned to discuss the matter with her board of directors on Thursday.
San Pablo, which borders Richmond, in April passed its own moratorium on cash-for-gold businesses. City leaders there were alarmed at the growth of such businesses, noting in a staff report that as many as nine were operating in the 2.5-square-mile city earlier this year.
High gold prices, hovering around $1,600 per ounce, a sluggish economy and high local unemployment created a "perfect storm" for the rise in such businesses in the city, according to San Pablo city planner Tina Gallegos.
San Pablo police Chief Walt Schuld told his council in April that the businesses contributed to a spike in burglaries.
Richmond Councilman Nat Bates was skeptical about any links between the gold trade and crime.
"If you think a moratorium is going to deter burglars, then you've got to be smoking something that is not legal," Bates told his colleagues. "This moratorium will do nothing to curtail (burglaries), but it may make everybody feel good, so I guess I will have to go along."
Councilman Jim Rogers noted that "other cities are moving toward this," and cited San Pablo specifically. Rogers said reducing the number of merchants where thieves could take their wares for money might be a deterrent.
Velasco said staff was hopeful that limiting new cash-for-gold businesses could reduce burglaries.
"We hope (crime reduction) will be a secondary impact," she said.