If "TOHS" stands for "Town of...," and you are the permitting or reviewing engineer, I'm assuming you're wanting to cover your bases before saying yes. Look at it this way: people walk on the sidewalk all the time. How often do they get hit by vehicles?
IR's right, you need to keep an accessible route open. Say 3' for utility poles, signs, etc, and a 5 ft accessible route. That leaves 4' for tables.
How well do drivers obey the speed limit? How wide is the street? If any vehicle encroachment is likely to be low speed and low angle, I'd be fairly comfortable.
On a wide street, with higher speeds and vehicles potentially veering across the road and hitting the curb at a higher angle, there are greater chances of a vehicle hitting the diners.
Take a look at the crash history. If there are a lot of people striking the curb in the area, it may not be a good idea. If speeds are low and there is no adverse safety history, it might be a good addition to the neighborhood.