The city is recommending council deny an application by Cactus Jacks to boost its maximum occupant number to 650, up from slightly less than 500 today.
As part of its application, the nightclub has offered to purchase the licence from now-shuttered Rivers on Lansdowne Street, eliminating it from being reopened downtown.
While the city has agreed with some of the ideas, including removal of the Rivers licence, a report says it cannot recommend the expansion while Cactus Jacks has an outstanding enforcement issue with the province.
"It's difficult going forward with recommendations to approve something when there's outstanding enforcement action," Lambright said.
"From the RCMP perspective, that's where they're having some problems."
Inspectors found 611 patrons inside Cactus Jacks during a review this year, putting it far over capacity. A hearing is not yet scheduled to hear the allegations.
The city is also asking Cactus Jacks, as a condition of future approval, to provide shuttle buses to the university area as well as providing more staff to disperse patrons at closing time.
In a letter of response, lawyer and company representative Dennis Coates said those are already being done.
Council will consider the request at its Tuesday meeting.
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