Behind the headlines: What’s next with big-box retail?
March 20, 2004
Q. You were the council member who proposed to City Council a 90-day moratorium on big-box retail. Why did you feel it was necessary to pass an emergency ordinance imposing the moratorium?
A. I was approached by the Downtown Business Association, the Mountain Business Association and the Community Alliance of the Yampa Valley with their concern over the economic impact big-box retail could have on Steamboat Springs. It was unusual to have organizations traditionally on opposite sides of community issues come together to address a common goal, which immediately caused me to pay attention to their concerns.
We have been discussing the big-box issues for two years, starting with a memo from city staff in June 2002 outlining possible approaches and continuing with a community discussion at the Economic Summit of 2003. The recent announcement of Gart Sports coming to the Wildhorse Marketplace energized the groups concerned with the issue to try to do something now.
At last week’s council meeting, we heard from developers concerned about the effect of the moratorium on five projects that are already in the planning process. The council assured them that it was not our intent to affect projects already submitted, but it illustrates the level of activity of large commercial projects. The moratorium allows the community to evaluate the issues involved with big-box retail and to implement regulations, if desired, before other projects begin the planning process.
Q. Why should the city look at an ordinance regulating big-box retail?
A. Last year’s Economic Summit spent the better part of a day discussing big boxes, and I will try to highlight the top issues. There is great concern that the proliferation of formula stores across America is causing cities to lose their individuality. By “formula” stores, I mean stores that look and operate the same wherever they are located, causing the places they are in to be the same as every other place; turning America into “Generica”.
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Steamboat’s feel and ambience frequently is cited as our main appeal as a destination tourist resort. If our city begins to look like the towns where our visitors live, we will lose most of what differentiates us from other resort communities. I feel it is vital to our economy to try to protect this.
The affordability of shopping locally is a competing interest in the issue of our economic vitality. We cannot ban competition in our marketplace without affecting the lives of every one of our residents. We must strive to maintain a balance between these two issues.
There has been quite a bit of media attention about the effects of Wal-Mart’s policy of “Always Low Prices. Always.” These range from forcing manufacturer’s facilities overseas, enabling lower prices, to paying their employees rates below a livable wage. The recent California grocery worker strike was because of the supermarket chains being unable to compete with the nonunion Super Wal-Marts and Super Targets.
Another issue is the profits from the big-box stores not staying in the local community. Our businesses do an incredible job of supporting all of the nonprofit organizations in Steamboat Springs and the many events we have. The profits from our stores are reinvested in our community through owners spending money at other stores, restaurants and events. This creates more profits that are recycled through our community again and again. The profits from big-box stores go to their shareholders across the country and are not available for local reinvestment.
Q. What do you see as some possible solutions to managing big-box stores?
A. I am not in favor of banning stores of any size. Rather, I feel that we need to work on a combination of zoning and regulatory options that ensure that any big boxes which are approved are beneficial to the local economy. A possible solution would be to zone mid-size and big-box retail out of the mountain and downtown areas. This would help preserve the feel and ambience that is so important to our success as a destination resort. Stores in the big-box category might be asked to prepare an economic impact statement that would give Planning Commission and City Council the information necessary to assess what effects the store would have on our community. We can also use the Planned Unit Development process, where projects would have to show public benefit to be approved.
We should look at this issue not just from a Steamboat Springs perspective but from a Northwest Colorado perspective, too. Craig has Kmart, and there has been some discussion about placing big-box stores in Hayden as a regional shopping area. While having big-box stores outside the Steamboat Springs city limits does not help capture sales tax “leakage” for the city’s budget, it would keep those dollars in the Yampa Valley.
Q. Big-box retail critics would say the stores have negative aesthetic and economic impacts on communities. Which is the bigger issue?
A. They are both important issues. I believe that our community is already firmly behind the aesthetic issue, as is demonstrated in the recommendations for big-box stores in the draft of the Community Plan Update. The economic impacts are more difficult to grasp as there are positive and negative impacts from big-box retail. It is difficult to weigh these issues objectively without enough information, which is why I think an economic impact statement would be a valuable tool that could be required from true big boxes.
Q. Should the government have control over the mix of retail in a community or influence over the free market?
A. I believe that the government has a duty to help foster a strong economic environment for the betterment of its citizens. As someone with a degree in economics, I usually am a believer in letting the free market tell us what works. However, big-box stores do not operate on the same playing field or with the same rules as used by most of our local merchants. They can operate at a loss for a number of years to build up market share and force competitors out of business and then raise prices to become profitable. But just as we need affordable housing, we also need affordable shopping. The real issue is how to balance the competing needs.