The extension grants the town additional time to draft regulations regarding personal-service businesses—work that will most likely be done through the general plan committee.

"This is not a real challenging process," Community Development Director Bud Lortz said to the town council, adding that regulation could probably be drafted in five months.

The town council passed an urgency ordinance in early September, banning new personal-service businesses from opening on the ground floor of the downtown business district south of Highway 9 and along Main Street from Santa Cruz Avenue to the civic center.

The council concluded that the high number of applicants seeking permits to set up these shops constitutes a "current and immediate threat to the public health, safety or welfare" of the town or that it could result in such a threat since it potentially puts in jeopardy the mix of businesses in the area.

The only council member who did not reach this conclusion was Diane McNutt, who opposed the moratorium.

But it was that fear that initially prompted Antiquarium owner Shirley Henderson to ask the town to consider placing a cap on such businesses.

"I got real panicky when four were going in around my store," said Henderson, who calculated that 69 personal-service businesses exist in the area. That many of any one type of business, be it salons, shoe stores or antique stores, is not healthy, she said. "Sixty-nine is too many. We have to put a stop to it."

Prema Hudes of Cloud 9 Floatation had been in discussion with the owner of the Garden Inn to offer water therapy at the hotel but can no longer move forward with plans.

"I appreciate the council for helping to manage the economy of this town, though I cannot go past the feeling that this moratorium did not directly come from the town council, but it originated from some people who are afraid that the economy is going to affect their businesses," Hudes said.

The town faced a similar scare in prior years when restaurants started popping up. As a result, the town has taken a "cautious approach" to approving restaurants that want to open up in a space that was not previously used for the same purpose, including requiring a use permit, Lortz said. According to code compliance officer Roy Alba, approximately 46 restaurants exist in the area of downtown that is now in question.

When the council first discussed passing a moratorium, the town was informed of three possible applicants who were already in the process of obtaining permits to operate their businesses. At least one of these applicants, Capelli Salon, was allowed to proceed with plans and should open for business on Main Street soon.

Downtown merchants had mixed feelings about extending the moratorium.

"It's sad that they're putting a moratorium on salons because they're inhibiting growth," said Venus Envy clothing storeowner Julie Langtry, who called the moratorium "ridiculous."

With friends who travel as far away as Fremont to have their hair done in Los Gatos, Langtry said salons and nail places are destination points that draw people into the rest of town.

Hudes said she's proud to contribute to the town by serving as a destination point to make Los Gatos "an experience."

"Our customers, after they are relaxed, they like to eat, drink and shop downtown," she said.

Another personal-service business owner, Demetra Jennings of Nimbus Salon, said she is fine with the moratorium since there are enough salons at this time.

"As long as it is just for a year and can be reviewed, it's open for discussion," she said.