The controversial neon sign hanging on a side wall at the Institution Ale brewery in Santa Barbara can stay.

The Historic Landmarks Commission voted 5-2 on Wednesday to allow the sign, despite the fact that it conflicts with the city's Sign Ordinance.

The father-and-son team of Roger and Shaun Smith opened Institution Ale in February and installed a neon sign without a permit.

"Roger and Shaun have brought new life to the 500 block of State Street," said Gene Deering, a commercial real estate broker. "They spent a great deal of money upgrading the property and subsequently the block. They are bringing millennials like myself back to State Street, which is a great thing."

The commission voted to allow the sign because it fits with the historical nature of the building, 516 State St. Once home to a former car dealership, the building had neon signs hanging above it. The brewery's architect, Joe Andrulaitis, also showed several photos of signs of other businesses in the area with neon signs. Andrulaitis plopped down neon signs from businesses such as the SB Nail Bar, 3D Studio Gallery, Lao Ma Tou, the Little Rainbow Foot Spa, Old King's Road and N.Y. Pizza in front of the commissioners to make his point.

"You guys have approved neon before," Andrulaitis said.

Institution Ale's $8,000 sign was ruled in violation of the sign ordinance because it is less than 5 feet from the front window, and it should be at least 10 feet away. The owners said it would cost thousands of dollars to move the sign.

Some of the speakers during the public comment period said the sign was inappropropriate.

“It is interesting to me that the applicant’s main justification for exemption is to tattle on business competitors," Rick Closson said.

He put down a piece of paper that read "Just Say No" in front of the commissioners before they started deliberations.

“The commission’s decision should not include consideration of downtown business difficulties," Closson said. "The applicant’s business will not be harmed by moving the neon sign out of the required setback. Installing this sign was a blunder, either through careless oversight or intent of the applicant."

Closson said that allowing the sign would empower other business owners to follow suit.

"Your decision today will set the tone for future applicants, whether they will read and follow existing and relevant El Pueblo Viejo ordinances during the application and construction processes, or they will ignore the rules hoping not to get caught and then beg for special exemptions," Closson said.

City critic Anna Marie Gott said the sign should be moved to the back room because it's too distracting from the street and could cause motorists to injure people or worse.

“You as someone who is driving at night down the street, where there is a stoplight in the midblock, which is very unexpected, where someone was killed last year because of a distracted driver, then we are actually looking at a hazard," Gott said. "If you are looking at the purpose and intent of the sign ordinance, it is to minimize that distraction.”

Commission board chair Anthony Grumbine said he supported the sign because it fits with the streamline modern style of architecture of the building.

"This is an example of where an exception could be made," Grumbine said.

The decision is appealable to the City Council within 10 days of Aug. 7.

— Noozhawk staff writer Joshua Molina can be reached at .(JavaScript must be enabled to view this email address) . Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.