New York Zoning Law and Practice Report
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NEW YORK ZONING LAW AND PRACTICE REPORT January/February 2007 Vol. 7, No. 4 In This Issue • A Guide to Regulating Big Box A GUIDE TO REGULatING BIG BOX STORES, FRANCHISE Stores, Franchise Architecture, ARCHITECTURE, AND FORMULA BUSINESSES and Formula Businesses ......... 1 Daniel A. Spitzer and Jill L. Yonkers Introduction Generations of travelers have marveled at the multi-hued wonders of the red rock country surrounding Sedona, Arizona. But a journey through Sedona does not include the stark Editor-in-Chief Patricia E. Salkin, Esq. reminder of one of America’s most common travel symbols. Managing Editor That is because in Sedona, the trademark arches of McDonald’s William D. Bremer, Esq. are teal green, not bright yellow, a concession made to local Electronic Composition demand for a more aesthetic complement to the community’s Specialty Composition/Rochester DTP southwestern architecture.1 Published six times a year by West Editorial Offices: 50 Broad Street East, The Sedona restriction is not unique. From a Starbucks in Cleveland, Ohio Rochester, NY 14694 which resembles a lighthouse on nearby Lake Erie,2 to an art-deco Wal-Mart in Baldwin Park, California,3 communities across the country are requiring Tel.: 585-546-5530 Fax: 585-258-3768 national corporations to drop signature-style motifs to accommodate local Customer Service: 610 Opperman aesthetic tastes. Nor do these regulations stop with issues of appearance; Drive, Eagan, MN 55123 more and more, communities are also limiting the size of so-called “big box” retailers and discount stores. Although allegedly enacted to counteract the Tel.: 800-328-4880 Fax: 612-340-9378 environmental impacts that these large, 100,000 square-foot-plus stores cre- ate in terms of traffic, pollution, parking requirements, drainage, and loss This publication was created to pro- of open space, in many instances the true goal is local economic protection. vide you with accurate and authori- These neutralizing provisions, largely in response to the perceived negative tative information concerning the impacts of Wal-Mart, have led to some communities prohibiting these busi- subject matter covered; however, this nesses from certain districts or even from their entire community. publication was not necessarily pre- pared by persons licensed to practice This article examines municipal efforts through local zoning and design law in a particular jurisdiction. The standards to regulate big box retailers, “franchise architecture,” where all publisher is not engaged in rendering stores have a similar look to create a nationally recognized brand, and “formu- legal or other professional advice and la businesses,” national or regional enterprises with similar building styles, this publication is not a substitute for the advice of an attorney. If you re- appearances, product offerings, and/or modes of operation (think of McDon- quire legal or other expert advice, you ald’s, Starbucks, or Subway). The three categories are not mutually exclusive, should seek the services of a compe- as often the objection to a Wal-Mart or K-Mart is to its aesthetics, not its size, tent attorney or other professional. Mr. Spitzer is a partner and Ms. Yonkers is a senior associate in the firm of Hodgson Russ LLP in Buffalo, New York. Reprinted from New York Zoning Law and Practice Report, Volume 7, No. 4, with permission of Thomson West. For more information about this publication, please visit www.west.thomson.com. New York Zoning Law and Practice Report is published by Thomson/West, 50 Broad Street East, Rochester, NY 14694. © 2007 Thomson/West 40479250 2 NEW YORK ZONING LAW AND PRACTICE REPORT while other efforts to control or eliminate big box retail- Although the constitutionality of land use controls, ers are specifically aimed at the large “super centers” or particularly zoning, has been recognized for over eighty “power centers,” where discount retailers are combined years,7 and its incidental impacts on commerce recog- with supermarkets. Similarly, concern over the prolifera- nized and accepted, regulations and planning decisions tion of formula businesses is often at the neighborhood- constituting pure local economic protection will still be sized level of McDonald’s and concerns both the architec- struck down.8 Similarly, while ordinances discriminat- ture and impact on the local economy. ing against an unpopular company with no legitimate We will consider the reasons for these enactments, the rationale for them will not stand, it remains the “fun- tools available to New York municipalities for regulat- damental rule that zoning” concerns land use, “not the ing these businesses, and the types of regulations used person who owns or occupies it.”9 Accordingly, we start across the country. Finally, the legal validity of these our discussion with the recognition that all regulations laws will be examined, including the counter-attacks must have a valid legislative purpose within the police that these businesses have launched against the regu- powers granted to municipalities; our search thus starts lating communities. We offer no opinion on whether such with an exploration of the ills each of our targets alleg- regulations should be adopted; that debate would be al- edly present. most endless given that for every study alleging harm from these businesses, there seems to be another show- 1. Big Box Retailers ing the benefits. Our goal is to explain the issues and create the mechanism for educated decision-making and Generally, when people hear the term “big box,” uni- action by the community’s hand. form visions of boxy, large-square-footage, plain-faced buildings with boastful, colorful signs come to mind, but the same consistency does not necessarily follow in the Reasons for Regulation municipal codes. The result is a hodge-podge of rules Concern over competition from large retailers and their attempting to define them, to restrict them by size, to secondary impacts on the local landscape and economy is trigger a heightened level of review, or to prevent them almost as old as department-type stores and chain stores altogether. themselves. As early as 1899, the City of Chicago—in an There are a number of factors prompting municipali- effort that presages current efforts to regulate super cen- ties to enact provisions regulating these businesses, and ters—enacted two ordinances against department stores, not all impacts are considered negative. Big box propo- “the object of each is to prohibit the sale of certain kinds nents tout the benefits of competitive or reduced prices, of merchandise in any store or place of business where convenience, and variety,10 with the economic benefits certain other kinds of merchandise are sold.”4 Through- of increased employment and sales tax revenues.11 Sup- out the 1920s and 1930s, there was a strong anti-chain porters also assert that the one-stop shopping super cen- store movement in reaction to their explosive growth: ters offer can actually reduce the number of car trips and Chain stores were in the American consciousness, therefore, related traffic impacts. In at least one case, a and for good reason. Led by the Great Atlantic and village used a new big box store as the centerpiece of its Pacific Tea Company (known throughout the country revitalization efforts.12 then and since as A&P), chain groceries, drug stores, On the other hand, to some, they mar the landscape cigar shops, gas stations, and variety stores revolu- and defile the local viewshed with their large, feature- tionized retailing in the first quarter of the twen- less construction and acres of parking lots, eliminate tieth century. During the 1920s, chains increased longstanding “Mom and Pop” stores, are inaccessible to their share of overall national retail sales from 4% pedestrians, and generate increased traffic and related to 20%, and their total share of grocery sales to 40%. pollution while placing unacceptable demands on exist- By 1930, A&P was the fifth largest industrial corpo- ing infrastructure.13 Significant concerns have also been ration in the United States, and was running more raised about the inability to reuse the large empty struc- stores than any other chain store company had or tures (and their parking lots) should the store close, or if 5 has since. an existing big box is abandoned as part of an upgrade While earlier regulatory measures were motivated to a super center. For the most part, residents advance almost solely by economic protectionism, opposition to- regulation (if not prohibition) of these businesses to pro- day focuses on a wider range of values. To be sure, local tect local economies, to ensure no negative impacts to economic pressures form the core values of significant home values, and to guard the community against in- opposition to Wal-Mart and other national chains. Many creased traffic, visual, air, and water pollution, and other of the cases discussed in this article, for example, arise perceived or actual impacts. Many communities also op- from Wal-Mart’s and its competitors’ expansions into pose Wal-Mart, in particular, based on its supposed em- grocery sales and the opposition from both supermarket ployment practices, lack of unions, and impact upon and chains and their unions.6 attitude toward the proposed host community. For authorization to photocopy, please contact the Copyright Clearance Center at 222 Rosewood Drive, Danvers, MA 01923, USA (978) 750-8400; fax (978) 646-8600 or West’s Copyright Services at 610 Opperman Drive, Eagan, MN 55123, fax (651) 687-7551. Please outline the specific material involved, the number of copies you wish to distribute and the purpose or format of the use. New York Zoning Law and Practice Report (USPS# pending) is issued bimonthly, six times per year; published and copyrighted by Thomson/West, 610 Opperman Drive, P.O. Box 64526, St. Paul, MN 55164-0526.