The Hometown Advantage

• Jobs - Superstores create jobs, but studies show they eliminate an equal number of jobs at existing retailers and wholesales. See Emek Basker, “Job Creation or Destruction?” University of Missouri, 2002, as well as studies by Dr. Ken Stone and others available under the Tools & Resources section.

• Wages – New superstore jobs often have lower pay and benefits than the jobs these stores eliminate. Low wages for full-time workers are placing an increasing burden on public assistance programs. One report found the average superstore employee requires $2,000 annually in health care, housing, and other assistance to make ends meet. See "Hidden Cost of Wal-Mart Jobs," University of California, 2004, and reports from Tennessee and Georgia.

• Local economy - Local retailers support a variety of other local businesses, such as accountants, printers, local media, and banks. Superstores require little in the way of local goods and services. See Institute for Local Self-Reliance, "The Economic Impact of Locally Owned Businesses vs. Chains: A Case Study in Midcoast Maine," 2003, and studies by Civic Economics.

• Community - Local businesses build strong communities. Local merchants are often involved in community organizations and events. Studies have found that they give more to charity, relative to overall sales, than big companies.

• Public costs - Spread-out land use patterns are costly in terms of services such as roads, sewers, police, and fire, especially if taxpayers are also maintaining services in an underutilized downtown. These public costs may exceed the tax revenue generated by a superstore. See Development Economics, “Understanding the Fiscal Impacts of Land Use in Ohio,” 2004, and Tischler & Associates, “Fiscal Impact Analysis of Residential and Nonresidential Land Use Prototypes,” 2002.

• Downtown – Studies have shown that superstores do not generate added customer traffic for downtowns. In fact, they detract from downtown vitality by undermining small businesses and drawing economic activity to the outskirts. See Dr. Thomas Muller and Elizabeth Humstone, “What Happened When Wal- Mart Came to Town?” National Trust For Historic Preservation, 1996.

• Vacancy – Overbuilding has led to a national epidemic of retail vacancy. Empty strip shopping centers, dead malls, and vacant superstores now litter much of the rest of the country. If current development patterns continue, this trend will soon arrive in Maine. See Price Waterhouse Coopers and Lend Lease Real Estate Investments, “Emerging Trends in Real Estate 2002."

• Long-term prosperity - Trading a vibrant downtown with unique local businesses for sprawling cookie-cutter development lessens a community's appeal to entrepreneurs, relocating firms, and skilled workers, and reduces its long-term prospects for new investment and high-quality jobs.

• Consumers - Retail consolidation and chain stores' centralized buying patterns reduce opportunities for small manufacturers and thus the diversity of products available. Surveys suggest prices rise once competitors have been eliminated.

Strategies for Fostering Better Retail Development

• Steer new investment and commerce downtown. Establish a clearly defined commercial district. Avoid zoning large tracts of undeveloped land for retail. This prevents a glut of retail space, fosters compact development, and ensures that new growth does not shift activity away from downtown.

• Set an upper square footage limit on the size of new retail stores. Retail sales are relatively static and margins are thin. A town can absorb only so much new retail growth without severely impacting established local stores, overburdening public infrastructure, and undermining quality of life.

• Require economic, fiscal, and community impact assessments before approving new retail development. Developer covers cost of independent analyses. Approval hinges on demonstrating that store will not unduly harm traffic, tax revenue, public services, the downtown, or community character.

• Cooperate regionally. Work with neighboring communities and to develop a regional approach and shared standards for retail development.

• Allow, encourage, or require that new growth replicate traditional, pedestrian-friendly commercial districts (multiple story buildings, small lot sizes, little or no setbacks, on street or rear parking, etc.). This is ideal "habitat" for locally owned businesses.

• Focus economic development resources on helping locally owned business expand and new entrepreneurs get started.

• Develop a long-term downtown revitalization plan.

• Form an independent business alliance to gain strength in numbers and educate the public through "buy local" campaigns about the importance of supporting locally owned businesses.

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