The city of Sonoma is moving closer to regulating so-called formula businesses, including an outright ban on the city's historic Plaza.

City staff are preparing a draft ordinance that would set limits on chain and similar businesses and where they can locate in the city of 10,000.

Other than design review of buildings, Sonoma does not define or regulate businesses that meet zoning regulations, including in the downtown area.

A Staples store that recently opened in a building that formerly housed a Ford dealership sparked the current debate over formula businesses. It did not have to apply for a use permit to operate.

A divided city council on Dec. 19 directed staff to draft the proposed ordinance based on the recommendations of an ad hoc committee that city leaders formed to tackle the contentious issue. The eight-member group includes council members, business interests and slow-growth advocates.

The ordinance would define formula businesses as any that include 10 or more outlets, excluding hotels, offices, financial institutions and other types of service businesses.

These businesses would have to get a use permit to open. Those going in to shopping centers with five or more tenants would be exempt from the rules.

In addition, businesses that include more than 250 outlets would be banned from the plaza area.

Mayor Joanne Sanders said Tuesday that the new restrictions would lead to more commercial vacancies in the city and less tax revenue. She and council member Tom Rouse cast the dissenting votes against the draft ordinance.

They also were opposed to the city council considering a moratorium on formula businesses until such time as the new rules are enacted. The council is planning to take up that issue on Jan. 18.

"When local governments limit competition in one category, it drives up prices for working families and limits our access to certain products," Sanders said.

Councilman Ken Brown, who voted in favor of the draft ordinance, said regulation is necessary to protect the town's character, particularly at the plaza.

"I think Sonoma will be better for it," he said.