Big box retailers like Wal-Mart, Target, Lowe’s and Home Depot don’t want local officials to understand the real economic impact of their huge proposals on the local economy. Most communities have nothing in their zoning code to require an economic cost/benefit analysis, despite the fact that some states — like Vermont — have been examining the economic consequences of zoning decisions as part of the land use process itself. When economic studies are required at all, they are done by consultants hired by the developer, and, not surprisingly, always show that the big box store will enhance the local economy, not impair it. But too many local officials in too many towns have seen the devastation with their own eyes. This week in Maine, state officials are considering legislation that would require developers of stores greater than 75,000 s.f. to pay $40,000 up front for an independent study on the economic and environmental effects of their project on the local area. “I’ve heard from Maine Street in Bath, from Topsham and Brunswick – people not even in my district,” said Sen. Paula Benoit, R-Sagadahoc County, who owns a small business owner, told the Maine State House News. “They’re begging me to take action.” Rep. Chris Barstow, D-Gorham, the main sponsor of the bill, said his proposal will help the community to understand the implications of their land use decisions. The economic impact study would be conducted by independent reviewers. And reviewed by the state’s Planning Office. The studies would look at net impacts on property taxes, municipal budgets, local retail jobs and wages. These studies could be used by the local planning boards or permit granting authorities to determine if the project had an “undue adverse impact” on the local economy, which would be the criteria for denying a project. The bill would require all cities and towns in Maine to conduct such studies — but the developers would foot the bill. Not surprisingly, the legislation has run into opposition from real estate brokers, developers and business groups, including the Portland Regional Chamber of Commerce, the Maine State Chamber and Maine Merchants Association. These groups tried to convince lawmakers to make the bill a local option, so each community would have to vote to adopt it. “The truth is, you’d rather not have it at all,” said Sen. Elizabeth Schneider, D-Penobscot County. “I don’t understand the complete pushback from your organizations. This is not ant-business. I think it is pro-business,” because it helps people understand what effect big retailers will have on their community. Schneider said the former mayor in Bangor sent her a letter in support of the bill, because he has seen “the long-time stores that have closed in our region.” The bill was amended during discussion to have the state develop a list of qualified entities to conduct such studies, and a stipulation that the studies would be done in three months, not six, as originally proposed.
At a public hearing in April, House Speaker Glenn Cummings testified in favor of the bill. This suggests that the bill has legs, and may survive efforts by developers to kill the bill with amendments. The legislation will have further discussions in committee, and then must go before the full Legislature for final approval. The Maine bill has been calld the “anti-Wal-Mart bill” in the media, but a better title would be the “full disclosure planning bill,” because it arms a local planning or zoning board with the information it needs to make an informed decision. It also clearly states that finding adverse impacts is a reasonable basis for rejecting a proposal. The neighboring state of Vermont has had economic impact criteria in its Act 250 environmental law since 1971. Many cities and towns across the country now have economic impact studies required. In my town of Greenfield, Massachusetts, our Major Development Review zoning ordinance requires an economic impact study as part of the special permit process, but it allows developers to conduct their own study, which produces garbage reports. In 1993, when Wal-Mart came to Greenfield, the town asked Wal-Mart to put up the funds to pay for an “independent” consultant. The town ended up using a vendor who had done Wal-Mart work before. Even so, the report was used against Wal-Mart, because it showed significant job losses, losses in existing retail square footage, and negligible property tax gains, once the cost of public services were deducted from the gross receipts of the project. Similar economic studies in Vermont and elsewhere have often shown little or no economic benefit from big box stores — and in some communities a net loss in revenue. Developers who oppose such independent studies are arguing against full disclosure, and the right of public officials to understand the likely financial results of their actions. That’s why the developers are having a hard time fighting this proposed law — because good governance depends on good information.
