Drinking establishments in the outlying areas of Iowa City are one step closer to having more flexibility in where they may set up shop.

Currently, an ordinance restricts new drinking establishments in all of Iowa City from opening within 500 feet of existing such establishments. While city officials maintain the original law, enacted in 2009, was meant to prevent the growth in the number of drinking establishments downtown, they now believe the reach of those restrictions is too expansive.

Officials now believe those highly concentrated areas are now limited to the University Impact Area — which includes downtown — and the Riverfront Crossings District. The ordinance would eliminate the spacing requirement in all other areas of the city.

The City Council approved the first consideration of the ordinance on Tuesday evening on a 6-1 vote, with Mayor Pro-Tem Susan Mims having the dissenting vote. A proposed ordinance requires three votes before it becomes law; councilors will vote on the second consideration of the ordinance at their next meeting, Aug. 6.

City Councilor Jim Throgmorton asked about the pattern of excess drinking occurring outside the downtown area prior to the ordinance’s passage in 2009, and city officials couldn’t point to any difficulties.

“I don’t think that the change in the zoning code that we are proposing is likely to lead to any difficulties,” Throgmorton said.

City Councilor Terry Dickens said, based on conversations with potential investors, he believes the ordinance is detrimental to the city’s growth.

“A lot of the investors talking to me have talked about or have already gone to Coralville,” he said. “They’re young professionals … [they] don’t want to always be with the bar crowds.”

Dickens noted that investors want to set up shop in commercial zones, but the ordinance limits them from doing so. “I think we’re losing some very valuable areas,” he said. “There need to be some more choices.”

In a city memo, associate city planner Karen Howard wrote that “the community has benefitted from the opportunity created by the ordinance for a greater mix of business downtown as a few nonconforming bars have gone out of business and have been replaced by retail and office uses.”

Mims, the sole opponent, thought the proposed ordinance wouldn’t provide enough limitations on businesses in the outlying areas.

“What we’re doing with this is taking all of the areas outside of the university and the Riverfront Crossings and having no limitations at all,” she said. “By the time we recognize there’s a problem, we end up like we were downtown, and we end up with having so many drinking establishments.”

Mims said she wished the proposal would have provided the outlying areas with more flexibility but at the same time enforcing some density limitations.

City Councilor Michelle Payne and Mayor Matt Hayek both said they wouldn’t mind revisiting the ordinance in the future if issues were to arise.

“We didn’t have a problem in the outlying areas prior to the 500-foot ordinance,” Payne said. “I can’t see how it would [be] a problem now. If something staff notices … that this is happening, a lot of people are applying for permits, then we can always revisit this.”