# Too restrictive?



## jar546 (Aug 19, 2010)

You gotta read this one:

http://www.usatoday.com/news/nation/2010-08-17-chain-restaurants_N.htm?se=yahoorefer


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## Yankee (Aug 19, 2010)

I don't think so.


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## mark handler (Aug 19, 2010)

Yankee said:
			
		

> I don't think so.


Ditto......


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## cboboggs (Aug 20, 2010)

I don't think so either.


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## cboboggs (Aug 20, 2010)

I don't think so either.


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## Coug Dad (Aug 20, 2010)

Bainbridge Island Washington has one McDonalds, one Subway, one Safeway and one Starbucks.  They have said no more chains and have been able to enforce it.


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## fatboy (Aug 20, 2010)

I don't think so also..........


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## Uncle Bob (Aug 20, 2010)

Communities should have the right to protect their ambiance and businesses. Chain stores and restaurants destroy the rights of communities to maintain their way of life; and drain it's means of subsistence.

The Wal-Mart, K-Marts, Lowes, Home Depots, chain stores and restaurants, destroy; not only the ambiance; but the individually owned businesses; and, in doing so have destroyed the entrepreneurial spirit which has been the foundation of this democratic republic.

The courts have replaced the will and consent of the people.

The communities will eventually and inevitabley lose,

Uncle Bob


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## MarkRandall (Aug 20, 2010)

I'm not going to go with the trend of responses so far. IMHO, banning chain restaurants and businesses is unconstitutional because it creates an inequitable business environment of competition in favor of local ownership.

I think what needs to happen in communities like this one is to establish what makes this community unique, then develop design requirements that must be met by both local and out of town investors. Character of a community can be maintained without banns like this one. The design guidelines may cause some companies not want to build in that town. The design guidelines could also limit the foot print or number of stories of a development. A requirement like that will keep out the "big box" stores. If a local man wants to build a 60,000 SF box store and can, so should the Walmart's or Home Depot's.


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## Paul Sweet (Aug 22, 2010)

I agree with Mark Randall.  Franchises can be a good way for somebody to open a business.  The franchise offers brand recognition and can (although it doesn't always) assist the franchisee in running the business.  Architectural and signage restrictions can limit formula buildings that don't fit the character of the town.  We have several franchises in old buildings in downtown Richmond that don't look out of place.

I wonder why the ban is limited to restaurants.  It doesn't seem fair if banks, auto dealerships, and other non-local businesses are allowed to locate in the town.


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## Yankee (Aug 22, 2010)

I actually think the ordinance(s), although we don't have the wording, is probably very much like the last two posters suggest as it is not legal language to disallow "franchises" or "fast food". As mentioned, "formula" restaurants are not permitted and I expect that language leans more toward design/branding/signage etc. For instance, not permitting drive thru food establishments, requiring architectural review/elements etc can by nature keep most of the "undesirable" elements out and keeps the field level.


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## RJJ (Aug 23, 2010)

Having fought this battle many years ago under the Fair Share principle I will be interested to see if this becomes an element of exclusionary zoning. Different state but the principle is the same. The courts have become a great deal more liberal so my guess is the town fathers will lose especially if they take it to the higher courts.


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## MarkRandall (Aug 23, 2010)

From another article, here's their description of a formula restaurant:

It defines a "formula restaurant" as a business required to provide "substantially identical named menu items, packaging, food preparation methods, employee uniforms, interior decor, signage, exterior design or name as any other restaurant or delicatessen in any other location."

If this is accurate, I still stand behind my earlier comments. This goes way beyond the esthetics of the building by covering requirements of the menus, packaging and food prep. I also found it interesting reading comments at the USA Today link. One of the respondents, a local person, describes the cost of food at existing establishments ($10 for a burger) and how many can not afford to eat out in their own town. I think I'd take the healthier choice of a $5 foot long at subway


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## Francis Vineyard (Aug 23, 2010)

From the article;



> Chuck Thompson, executive director of the International Municipal Lawyers Association, says the investors may have a legal argument if they can prove the town of Springdale attempted to limit business ownership to local investors.


If the zoning permits this type of occupancy and the town officials deny a business because they are not local private investors then that’s discriminatory and the zoning ordinance is not valid.  What zoning can do is regulate the signage and building architecture.



> A letter taped to the door of this potential Subway restaurant in Springdale, Utah, says the business has not opened because town officials refuse to grant a final fire inspection. The town claims a Subway franchise would violate its ordinance banning "formula restaurants."


The other thing that appears maleficent is to withhold the final fire inspection because of the zoning dispute.


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## Yankee (Aug 23, 2010)

Francis Vineyard said:
			
		

> From the article;If the zoning permits this type of occupancy and the town officials deny a business because they are not local private investors then that’s discriminatory and the zoning ordinance is not valid.  What zoning can do is regulate the signage and building architecture.
> 
> The other thing that appears maleficent is to withhold the final fire inspection because of the zoning dispute.


I think we should not debate wording that came from a newspaper article as it is notoriously misstated.


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## Francis Vineyard (Aug 23, 2010)

Yankee

I'm ignorant of its notorious misstatements.  Note my comments with "if's" and "appears" on the article that this thread is referencing.


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## Fritz (Aug 23, 2010)

Communities have been doing this for sometime, such as lounges with brass poles.  Then they moved onto lounges with smoking, now they are onto your choice of food to eat.  Whats next?    All generalizations are dangerous, even this one.

Fritz

I know I’m paranoid, but am I paranoid enough? — Tom Clancy


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## peach (Sep 12, 2010)

If you're familiar with what a traditional checkers restaurant looks like, I saw one in a community with a color scheme ordinance... this particular checkers was beige and coral.. they adapted to the local ordinance.

Zoning ordinance shouldn't prohibit businesses just because they are a franchise.. just impose the same requirements on all of them.

Georgetown now has an apple store.. it took Apple a couple of years to get thru the historic board, but they did... eventually.  (Kind of different issue.. kind of the same).

As long as the ordinance isn't clearly discriminatory, but sets tight limits.. it'll withstand constitutional challenge.. it the language is discriminatory (which it sounds like this is).. it'll be tossed....   just like many sign ordinances are.


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## mark handler (Sep 12, 2010)

Town Character Overlay Districts

When enacting a formula business ordinance, a city should articulate within the ordinance and its legislative history the public purposes the law will serve and specify how the restrictions will fulfill those purposes. This is key to crafting a sound ordinance that will not be susceptible to legal challenges. The ordinance should reference the city's comprehensive plan, identifying goals within the plan that a formula business restriction will help to fulfill.  These commonly include:

•Maintaining the unique character of the community and the appeal of its commercial district

•Protecting the community's economic vitality by ensuring a diversity of businesses with sufficient opportunities for independent entrepreneurs

•Fostering businesses that serve the basic needs of the surrounding neighborhood, rather than those oriented toward tourists or regional shoppers

There have been two court challenges to formula business ordinances.

A California Appeals Court decision upheld Coronado's formula retail ordinance in June 2003 after several property owners challenged the law.  The court ruled that the ordinance does not violate the US Constitution's commerce and equal protection clauses, and is a valid use of municipal authority under California state law.

Most of the decision deals with the property owners' contention that the law discriminates against out-of-state companies and thereby violates the Constitution's dormant commerce clause. The court found that the law does not in fact "impose different regulations on interstate as opposed to intrastate businesses, nor does it distinguish between those businesses that are locally owned and those that are owned by out-of-state interests." The court noted the law focuses on whether the store is contractually required to have standardized features, regardless of whether it is part of a national chain or owned by a California resident.

The court also ruled that the law did not have a discriminatory purpose. The ordinance's lengthy preamble states that the city seeks to maintain a vibrant and diverse commercial district, and that the unregulated proliferation of formula businesses would frustrate this goal and lessen the commercial district's appeal. The court concludes that this is a legitimate purpose, noting that "the objective of promoting a diversity of retail activity to prevent the city's business district from being taken over exclusively by generic chain stores is not a discriminatory purpose under the commerce clause."

The court also dismissed the equal protection and state law challenges, stating that the ordinance is rationally related to a legitimate public purpose.

In 2008, a federal district court overturned a formula business ordinance adopted by the town of Islamorada, Florida. The ruling was subsequently confirmed by an 11th Circuit Court decision. Islamorada's ordinance limited formula businesses to no more than 2,000 square feet and 50 linear feet of storefront. Although the court said that preserving distinctive community character was a legitimate public purpose for enacting a formula business ordinance, it ruled that Islamorada had not demonstrated that this was in fact the purpose of the law. Local officials had instead revealed that the true purpose was protecting particular local businesses.

Moreover, the court noted that Islamorada, which has no downtown or other historic commercial district and consists instead of strip development along U.S. Highway 1, had taken no other steps to develop or protect its distinctive character. Sites already occupied by formula businesses have been redeveloped as new formula businesses with no objection from city officials.

http://www.newrules.org/retail/rules/formula-business-restrictions


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## jar546 (Sep 12, 2010)

Thanks Mark.  This was a great and informative find


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## mark handler (Sep 12, 2010)

IMHO

If there is Unlimited zoning there will no longer be any reason to visit the historic Towns because the "Character" of the "Old Town Districts" will be deminished. The National branded and franchise businesses are able to build outside the Town Character Overlay Districts and get the tourists coming and going, but thats not what they want.


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## peach (Sep 12, 2010)

thanks for your opinion Mark..

there's not a lot of reason to visit historic towns that do have an overlay district... many of us travel and want to eat (or sleep) at a branded business.. since there is some consistency built in with a Subway rather than  "momma's historic sandwich shop"... (might be perfectly fine.. my cousin got food poisoning at one)...


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## TJacobs (Sep 13, 2010)

You should see our Sonic...we don't ban chains, we make them jump through hoops...


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## Mule (Sep 13, 2010)

Houston Texas didn't even have a zoning ordinance until recently. You could have a feed lot next to a restaurant.


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## RJJ (Sep 17, 2010)

Zoning and Historic Districts need to be in place, but at the same time promote a balance that is pleasing and still allows for progress.


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## peach (Sep 25, 2010)

Need to keep Historic Districts (glad I don't have any responsibility to make those decisions)... they are Historic for a reason... it comes down to signage and color scheme that doesn't impair the District.


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## peach (Sep 25, 2010)

Need to keep Historic Districts (glad I don't have any responsibility to make those decisions)... they are Historic for a reason... it comes down to signage and color scheme that doesn't impair the District.


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## peach (Sep 25, 2010)

Need to keep Historic Districts (glad I don't have any responsibility to make those decisions)... they are Historic for a reason... it comes down to signage and color scheme that doesn't impair the District.


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## RJJ (Sep 30, 2010)

Peach: There is a little more to a Historic District then color and signage!


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## Francis Vineyard (Jul 10, 2013)

*CONSTITUTIONAL ISSUES*
​

*Izzy Poco, LLC v. Town of Springdale, *
​

*Case 2:10-cv-00559CW, Bus. Franchise Guide (CCH) ¶ 14,715 (D. Utah Oct. 28,2011)*
​


This case involves the interesting issue of the constitutionality of a town ordinance banning formula restaurants. A federal district court in Utah concluded that although such an ordinance might not be constitutional, the law governing this area was not so clearly established as to defeat the qualified immunity defense asserted by town employee defendants.  The town of Springdale, Utah, near Zion National Park, passed an ordinance banning “formula restaurants,” which the ordinance defined as any business “which is required by contractualor other arrangement to provide any of the following: substantially identical named menu items, packaging, food preparation methods, employee uniforms, interior décor, signage,exterior design, or name as any other restaurant or delicatessen in any other location.” The town justified the ordinance by explaining that formula restaurants were incompatible with the town’s general plan because of the limited amount of private land available, the large size or scale of such restaurants, excessive noise, odor or light emissions, and other excessive use of resources. Plaintiff, a Subway franchisee, obtained a business license to operate a sandwich shop; but when town officials realized that the sandwich shop would be a Subway restaurant, they refused to perform services or renew the business license to allow that restaurant to open. The franchisee sued, challenging the constitutionality of the ordinance and seeking monetary damages under 42 U.S.C. § 1983 as well as declaratory and injunctive relief. All individual defendants moved for summary judgment on the grounds of qualified immunity, claiming that the franchisee could not prove that a reasonable official would have known that their specific conduct under the ordinance violated the franchisee’s rights under clearly established law. The court agreed and granted summary judgment to individual defendants.The court agreed with the franchisee that state governments may not significantly burden interstate commerce through discriminatory, protectionist legislation. The court explained, however, that the franchisee did not establish that “facially neutral laws prohibiting franchise restaurants have been clearly established as violating this constitutional principle.  ”Although the court noted that one case from the Eleventh Circuit had “held that a local regulation banning franchise restaurants should be subject to a heightened level of scrutiny” under the commerce clause, there were no U.S.Supreme Court or Tenth Circuit cases on point.  The court’s characterization of the ordinance as facially neutral is interesting because it was clearly targeted toward a particular type of restaurant rather than applying to all restaurants of a certain size or possessing other characteristics that the ordinance deemed undesirable. Finally, although individual defendants were dismissed, the franchisee was not left without any remedy because its challenge to the ordinance remained. However, the dismissal of individual defendants precluded the recovery of any damages.

ABA-Franchise-Law-Journal-Spring-2012.pdf

Francis


​


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## MASSDRIVER (Jul 11, 2013)

TJacobs said:
			
		

> You should see our Sonic...we don't ban chains, we make them jump through hoops...


Why?

Brent.


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## lunatick (Jul 12, 2013)

I think if this is pressed to the Supreme Court it will ultimately fail.

Is one thing to limit number of say liquor stores. Restrict where bars are located within proximity of schools etc.

Or provide oridances which impact the architectural character of a community, zoning, etc.

But this is going beyond and infringing upon the right of commerce and interstate commerce imo.

At somepoint someone with enough gumption and money may take that battle on.

Until then....


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## peach (Jul 14, 2013)

It took the Apple store 2 years to get zoning/historic approval to do their tenant build out in Georgetown.  Most (but not all) of it was signage.  Happens all the time.


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