(1) The operation of adult entertainment businesses has historically and regularly been accompanied by secondary effects that are detrimental to the public health, safety, morals and general welfare of the citizens of Covington. Such secondary effects include significant criminal activity and activities injurious to the public health, safety, morals and general welfare of the community, detrimental effects on nearby businesses and residential areas and a decline in property values in the area of the adult entertainment businesses. This history of criminal and injurious activity includes prostitution, narcotics and liquor law violations, breaches of the peace, assaults, employment or involvement of minors, sexual conduct between customers or between customers and entertainers, the opportunity for the spread of sexually transmitted diseases and the presence within the industry of individuals with hidden ownership interests and outstanding arrest warrants. Accordingly, there is a compelling need and interest to regulate adult entertainment businesses as provided in this chapter to protect and promote the public health, safety, morals and general welfare of the citizens of Covington;

(2) These activities occur regardless of whether adult entertainment is presented in conjunction with the sale of alcoholic beverages;

(3) The resources available for responding to problems associated with adult entertainment businesses are limited and are most efficiently and effectively utilized through a licensing and regulatory program;

(4) The license fees required in this chapter are necessary as reasonable fees imposed to help defray the costs of processing the license applications and the substantial expenses incurred by Covington in regulating the adult entertainment industry;

(5) Adult entertainment businesses have historically engaged in practices that involve secreting ownership interests for such purposes as money laundering, skimming profits and tax evasion. These hidden ownership interests have, on occasion, been held by individuals and entities reputed to be involved in organized crime. To detect and discourage the involvement of organized crime in the adult entertainment industry, to effectively deploy its limited law enforcement resources and to effectively protect the public health, safety, morals and general welfare of its citizenry, the city must be fully apprised of the actual and controlling interests of adult entertainment businesses and the identities and criminal backgrounds of persons responsible for he management and control of such businesses;

(6) To detect and discourage the involvement of organized crime in the adult entertainment industry, to prevent the exploitation of minors, to assure the correct identification of persons working in adult entertainment businesses, to effectively deploy its limited law enforcement resources and to effectively protect the public health, safety, morals and general welfare of its citizenry, the city must be fully apprised of the identity, age and criminal background of managers in adult entertainment businesses;

(7) It is necessary to have a licensed manager on the premises of an adult entertainment business during all hours of operation so there will be a person responsible for the overall operation of the business, including the actions of customers, entertainers and other employees. To monitor the actions of these individuals, a manager must be able to observe these individuals at all times;

(8) To prevent the exploitation of minors, to assure the correct identification of persons working in adult entertainment businesses, to effectively deploy its limited law enforcement resources and to effectively protect the public health, safety, morals and general welfare of its citizenry, the city must be fully apprised of the identity, age and criminal background of entertainers in adult clubs;

(9) Proximity between entertainers and customers in adult clubs facilitates sexual conduct, prostitution, transactions involving controlled substances and other crimes. To deter such conduct and assist law enforcement in detecting it, King County (before city incorporation) has historically required that an entertainer exposing nudity must be separated from customers by performing on a stage at least 18 inches above the floor and at least six feet from the nearest patron and has prohibited entertainers from engaging in sexual conduct;

(10) There is substantial evidence that such prohibitions are ineffective. Entertainers in adult clubs perform offstage erotic performances, variously referred to as “table,” “couch” or “lap” dances, which typically involve exposure of nudity or sexual conduct between entertainers and customers, or both, and may also include acts of prostitution, transactions, involving controlled substances and other crimes. To effectively deter such conduct and assist law enforcement in detecting it, it is necessary that all erotic performances in an adult club occur on a stage which is at least 10 feet from the nearest customer. Such a requirement is in effect in the city of Kent, Kitsap County and Pierce County and has been upheld as a constitutional regulation that furthers the governmental interest in preventing sexual conduct and other criminal conduct while still allowing an entertainer to convey an erotic expression (See Colacurcio v. City of Kent, 163 F.3d 545 (9th Cir. 1998), Kev, Inc. v. Kitsap County, 793 F.2d 1053 (9th Cir. 1986) and DCR, Inc. v. Pierce County, 92 Wn.App. 660 (1998), respectively).

(11) To prevent sexual conduct from occurring between entertainers and customers, customers must be prohibited from any stage where adult entertainment occurs and be prohibited from passing tips, gratuities or other payments directly to entertainers performing on stage.

(12) Adult entertainment businesses have historically attempted to prevent law enforcement and licensing officials from detecting sexual conduct, prostitution, sale and distribution of controlled substances and other violations of law occurring on the premises by employing warning systems maintaining a low level of lighting and other techniques. It is necessary, to effectively enforce this chapter and to protect the public health, safety, morals and general welfare of the city’s citizenry, that adult entertainment businesses be required to maintain a minimum level of lighting, that warning devices and systems be prohibited and that unannounced inspections be permitted by city licensing and law enforcement personnel;

(13) Adult arcades provide booths for individual viewing of live performances, videos and films distinguished or characterized by an emphasis on nudity or sexual conduct. Existing standards of conduct and facility specifications have not deterred customers from engaging in sexual conduct in such businesses. To detect and deter such conduct, to require maintenance of clean and sanitary conditions and to reduce the potential for the spread of sexually transmitted diseases, it is necessary to regulate the configuration and facility specifications of adult arcades as set forth in this chapter, including but not limited to restricting the occupancy of a booth to one person;

(14) An adult arcade might attempt to circumvent the limit of one person per booth by creating a small room, labeled “minitheater” rather than a booth, in which two, three or a small number of individuals would be able to view videos and films distinguished or characterized by an emphasis on nudity or sexual conduct. Moreover, traditional-sized theaters might also show such videos or films. Customers have used both traditional adult theaters and “minitheaters” within arcades as places to engage in sexual conduct. Existing standards of conduct and facility specifications have not deterred customers from engaging in sexual conduct in these businesses. To detect and deter such conduct and reduce the potential for the spread of sexually transmitted diseases, it is necessary to regulate the configuration and facility specifications, as set forth in this chapter, of spaces used by more than one individual to view adult entertainment. In particular, it is necessary to require that any group viewing area for such videos and films have a minimum of eight seats which may be accessed by customers without reservation in order to prevent or diminish a sense of privacy and intimacy which would be conducive to and enabling of sexual conduct between customers;

(15) To assure that minors are not subjected to adult entertainment, it is necessary to prohibit adult entertainment businesses from allowing adult entertainment performances, or pictorial representations of adult entertainment performances displaying nudity or sexual conduct, from being visible from outside the business; and

(16) To discourage customers of bars and other alcohol-serving businesses from moving to adult entertainment businesses at 2:00 a.m. for “after hours”’ activities, and the increased likelihood of breaches of the peace and other criminal conduct that arise from those customers and to reduce the adverse secondary effects of adult entertainment businesses on minors and the community, it is necessary to restrict the closing time of adult entertainment businesses. (Ord. 05-02 § 3)