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Big Stores That Destroy Local Businesses Grow Not Only by Market Forces But By Public Policies
Published on Sunday, July 8, 2001 in the Maine Sunday Telegram
Belfast Votes in Self-Defense
Big Stores That Destroy Local Businesses Grow Not Only by Market Forces But By Public Policies
by Stacy Mitchell
 
By a nearly 2-1 margin, Belfast voters recently endorsed a measure to limit new retail stores to no more than 75,000 square feet. The law will keep Wal-Mart, Home Depot, and other "big box" retailers out of the community.

The Belfast vote is part of a growing nationwide movement. In the last few years alone, more than 100 cities and towns have rejected big box stores.

Grassroots groups dedicated to halting retail sprawl and strengthening local businesses are springing up around the country. In Belfast, a citizen coalition known as Belfast First helped build support for the size limit.

The group has counterparts in dozens of other communities, including Friends of Flagstaff's Future in Flagstaff, Ariz., the Main Street Defense Fund in Northfield, Minn., and the 5 and 10 Coalition in Hatfield, Mass.

The dramatic rise of chain stores and decline of local businesses over the last decade is not simply the result of market forces. It is a trend that has been aided in no small part by public policy.

Land use and zoning rules often encourage auto-oriented development on the outskirts of town, while undermining central business districts. Local and state governments frequently provide multimillion-dollar subsidies to lure big box stores, but deny assistance to local merchants.

An increasing number of communities are adopting policies that support, rather than undermine, locally owned businesses and healthy downtowns.

Many, like Belfast, have barred construction of stores over a certain size. Others have adopted zoning policies that steer new development to areas in and around the downtown.

Still others require retail development proposals to undergo a comprehensive review and demonstrate no negative impact on the local economy, public revenue, or the character of the community. And many have stopped the flow of tax dollars to chain stores and are instead putting their resources behind projects that foster entrepreneurialism and bolster local businesses.

Far from impeding economic growth, such policies help maintain long-term economic health and stability. Although big box developers claim their projects will generate new jobs and boost tax revenue, numerous studies have found otherwise. These big stores usually force dozens of local businesses to close, destroying about as many jobs and much tax revenue as they create.

Much more of a dollar spent at a local store stays and multiplies in the local economy. Local merchants support a variety of our local businesses, such as banks, printers, accountants, and small manufacturers. Chain stores centralize these functions at their head offices and keep local spending to a minimum.

Consumers have options about where to shop and the community as a whole is not overly dependent on any one company. Corporate retailers tend to be fair-weather friends and routinely abandon stores when the economic winds shift. Wal-Mart currently has more than 350 vacant outlets nationwide.

Locally owned businesses also create a sense of place and local character. They help maintain vital, walkable downtowns. There's much to be said for the community benefits of doing business with our neighbors — people who greet us by name, send their kids to school with ours, pay taxes to support local services, contribute to local causes, and share our concerns and hopes for the future of our communities.

Unlike much of the country, Maine still has many local businesses and active downtowns. But this may not last for long. Several major retail companies are planning aggressive expansions into this region.

Belfast voters have taken steps to ensure that their downtown businesses continue to be a vital part of the community. Let's hope others follow their lead.

Stacy Mitchell of Portland is a researcher for the Institute for Local Self-Reliance and the author of "The Home Town Advantage: How to Defend Your Main Street Against Chain Stores and Why It Matters."

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