A divided Palm Coast Planning Board voted 4-3 last week to approved a 120-moratorium on permitting dollar-type discount stores–so-called “small-box stores”–to give the city’s planning department time to analyze whether the stores are hurting other types of businesses, grocery stores in particular, and whether they should be more strictly regulated.
Though supportive, the planning board was by no means particularly enthusiastic about the measure, its vote reflecting the seeming puzzlement shadowing the issue. “I for one do not feel we have an overabundance of the dollar stores, I shop at them,” Glenn Davis, who chairs the planning board, said. “I shop at Publix too.”
At one point the proposal also failed getting a recommendation from the planning board for lack of a second. But when board members said the city council was asking for the measure, they mustered a bare majority for the recommendation. One board member called it a “slippery slope,” and didn’t see where the proposal was coming from, but was willing to concede to the council’s prerogatives. “I think it is a waste of time, and I don’t know where it came from,” he said.
There is no pending application for such stores at the moment, and the city has imposed similar moratoriums in the past–on internet cafes at the beginning of the last decade, for example, and more recently on marijuana dispensaries. The first proved moot once the Legislature essentially regulated the cafes out of business. The second led to the city’s decision to limit dispensaries along its principal commercial arteries. But the rationale for either a moratorium on or regulation of small-box stores has been more fuzzy, since no health risk or gambling stigma attaches to the stores.
“This is a little bit of a tricky situation,” Katie Reischmann, the attorney representing the city at the planning board, said. “This type of moratorium is occurring really throughout the U.S. on a fairly frequent basis because of the just incredible volume of these small-box discount stores, the ones that sell things for a dollar, that type.”
The city, she said, is “trying hard to thread the needle here,” limiting the issue to such stores. Gas stations would not be affected, for example. “The real concern has been that these stores are crowding out the grocery stores,” creating “food deserts,” where fresh produce would not be available. The dollar-type stores, the theory goes, would crowd out such stores–even though Dollar Stores and their ilk don’t carry groceries.
“The trick in this is defining what we’re talking about,” Reischmann said.
The city has three commercial zoning districts. The city will study the compatibility of such stores within the districts, perhaps limiting stores to one or two of the three districts. Possibilities also include certain minimum distances between stores, to reduce perceived proliferation.
The Palm Coast City Council on Jan. 7 requested that its planning staff look into regulating small-box stores. At a special meeting on Jan. 14. The council passed a resolution signaling a “legislation in progress” ahead of a moratorium on new such stores. The planning department now has 120 days to study the issue and produce a recommendation.
What data exists nationally tends to support the city’s concerns, though the city’s retail geography, not lacking in grocery stores, may not fit the national picture. At least not yet: that potential lag is spurring the city to get ahead of what may happen if stores continue to proliferate. And there’s no question that dollar-type stores are proliferating: Dollar General, Dollar Tree and Family Dollar (owned by Dollar Tree) are among the fastest-growing retailers in the country.
The Institute for Local Self-Reliance, a non-profit that advocates for sustainability in development, issued a report damning to dollar-type stores in December 2018, with language Palm Coast’s attorneys have echoed in discussing the moratorium proposal to local officials.
The stores, Fast Company reported 15 months ago in a summary of the institute’s findings, “have made a killing in recent years by expanding into some of the county’s most vulnerable communities: small, rural towns, and urban, predominantly black neighborhoods. When that happens, dollar stores essentially take over the market, making it impossible for independent local retailers, like Foodliner, to thrive. And in doing so, dollar stores essentially ensure that people living in the areas they target will struggle to access healthy food. While affordable, dollar stores rarely offer any food beyond highly processed options, and in areas where it’s already difficult to find produce and fresh options (often called food deserts), they don’t do much to change the status quo.”
The stores are concentrated in the South. But based on figures the institute itself provides in its report, Flagler’s grocery stores have increased, not decreased, between 2005 and 2015.
Skeptics on Palm Coast’s planning board said the stores bring jobs and tax revenue, while the city was placing itself in the role of telling people where they should and should not shop. “It doesn’t make sense to me,” one board member said, noting the number of houses being built and the new residents moving in.
“I don’t think the intent is to try to get people to eat healthier, I think the intent is to provide the option of a grocery store in areas where they are being crowded out,” Reischmann said. But she acknowledged that there is no evidence at the moment that this is happening in the city.
Dodson-Lucas, originally from New York City, said anywhere the stores proliferate cause other upscale stores to hurt “because people will buy $1 dress before they buy a $90 dress, and there are a lot of people that want that $90 dress.” She said the city should provide data showing how many complaints have been generated by dollar-type stores and said: “There are an awful lot of people in Palm Coast that are concerned about these stores popping up all over our neighborhoods.”
A fellow-board member said he’s heard from both sides, especially after the Dollar Store on Matanzas Woods Parkway was built: that was the store that appears to have caused the movement for the city’s moratorium. There were also concerns about market demand: retirees like to shop in dollar stores, a board member said, finding the city’s role in the sort of market analysis that would lead to some form of regulation inappropriate.
Board members Jake Scully, Clinton Smith, Sybil Dodson-Lucas and Charles Lemon approved the recommendation. Davis, Christopher Dolney and Robert DeMaria were opposed. The measure moves to the city council for formal approval over two readings of the ordinance.