HAYWARD -- When it comes to happy hour at the Elephant Bar restaurant, Hayward is the asterisk.

On the Elephant Bar website or on its coupons, the little star can be found next to offers for $3 house margaritas, $4 tall beers and $5 Long Island iced teas from 3 to 7 p.m., directing the reader to fine print below.

"We have a disclaimer with Hayward," Elephant Bar district manager Jason Jago told the City Council and Planning Commission at a joint work session Tuesday. "It's available everywhere else but Hayward, and we're losing money because of it."

It's a city restriction that was put in place in 2006 along with other rules designed to make it easier for restaurants to serve alcohol. Previously, a restaurateur who wanted to include bar service would have to go through the expensive, time-consuming and not-guaranteed process of getting an additional city permit, and the new rules eliminated that need for "full service" restaurants that meet certain criteria.

Along with requirements such as 60 percent of receipts coming from food sales and the bar area closing along with the dining room, "a full service restaurant shall not offer any type of reduced-price promotion for alcoholic beverages."

Hence the side effect: Hayward isn't happy hour-friendly.

Out of 47 locations, three Elephant Bars get asterisked: Hayward, Oklahoma City and Overland Park, Kan. And Elephant Bar isn't alone: A representative from Mimi's Café also spoke on Tuesday, as did Chamber of Commerce President Kim Huggett, who said restaurants are at a "competitive disadvantage" with those in other cities.

Julie McKillop, who owns the downtown Neumanali restaurant, said she has unwittingly broke the discount drink rule on occasion because she was unaware of the ordinance.

"I found it to be a good promotion, and not necessarily one that increases alcohol consumption," she said. "I get people out because people know it will be a good time and other people are going to be there, and I think it's a valuable marketing tool."

Council members and commissioners generally supported relaxing the happy hour restriction, as well as another rule that prohibits live or recorded music, and asked staff to do more research and return with options on how to do it on a trial basis.

Mayor Michael Sweeney said they were overlooking the other aspect of revising alcohol regulations, as listed on the evening's agenda: "Develop more aggressive ways to shut down undesirable businesses that serve alcohol."

"It seems inappropriate to go forward with loosening regulations on one hand without some real tangible ways in which the city can live up to the other promises, which, to be honest, have been promises for as long as I can remember," Sweeney said.

The matter is expected to return to the council within a few months after further study.

Contact Eric Kurhi at 510-293-2473. Follow him at Twitter.com/erickurhi.