On the Use and Misuse of Moratoriums

When is a moratorium, for liquor or otherwise, useful in terms of controlling neighborhood development? When is it not?

This is your first of three free stories this month. Become a free or sustaining member to read unlimited articles, webinars and ebooks.

Become A Member

Residents and leaders in Washington, D.C.’s U Street area are now debating a proposal for a moratorium on liquor licenses. When is a moratorium, for liquor or otherwise, useful? When is it not?

Theoretically, local moratoriums on certain types of development can strengthen neighborhoods by encouraging a broader mix of uses. Unfortunately, they rarely actually work that way. More often, moratoriums become misused by opponents of growth in general, to try and slow or stop change.

The basic truth of moratoriums is that they don’t usually stop things, but rather move them somewhere else. Banning bars on U Street doesn’t eliminate demand for bars, it simply pushes any new supply to the next best location. Residential moratoriums, sometimes used in fast-growing suburbs, are the same.

Any discussion of a local ban on any particular use needs to consider where that use is most appropriate. It’s not enough to just say, “I don’t want more of X in my neighborhood.” We have to plan where we do want that use, make sure it can happen there, and then plan what we want in the banned location instead.

Malls Can Use Their Control In Ways Neighborhoods Can’t

One of the advantages suburban malls have over urban neighborhoods is total control of the merchant mix. Mall owners know that it’s important to have a wide variety of stores, so the best malls typically lease spaces to shops that will improve their mix, rather than those that will pay the highest rent.

When you’re at a mall and Verizon has a big luxurious shop, but AT&T and T-Mobile only have little carts, it isn’t because AT&T and T-Mobile can’t afford to outbid that shoe store down the hall; it’s because the mall owner will only lease out one big space to cell phone providers.

That isn’t limiting the free market. On the contrary, it’s taking a broad long term view of the market.

Urban neighborhoods usually can’t be as selective, because every building has a unique owner. Mall owners are concerned about the overall profit of the entire mall, so they can turn down high leases on individual storefronts if they think it will pay off with a little more business everywhere else. But if you only own one individual storefront, you’re going to maximize it with the highest-paying tenant you can find.

That sometimes results in neighborhoods with a bad mix of stores. We certainly see that in D.C., where many of our retail strips have a glut of bank branches, cell phone stores, or pharmacies.

If used carefully, a moratorium can help level the playing field for urban neighborhoods with a lot of small land owners. That only works if the neighborhood is desirable enough to fill all its storefronts even with limits, and if the moratorium is more a way to promote something new rather than limit something old.

But moratoriums shouldn’t be tossed around lightly. The key is to plan for what you do want and then make it happen. Moratoriums fail when they’re used without a master plan guiding them towards a specific goal.

And sometimes, it’s worth having a high ratio of certain things. For example, as a regionally significant nightlife district, it’s acceptable for U Street to have a lot of bars.

Like what you’re reading? Get a browser notification whenever we post a new story. You’re signed-up for browser notifications of new stories. No longer want to be notified? Unsubscribe.

Tags: economic developmentwashington dcretail

×
Next City App Never Miss A StoryDownload our app ×
×

You've reached your monthly limit of three free stories.

This is not a paywall. Become a free or sustaining member to continue reading.

  • Read unlimited stories each month
  • Our email newsletter
  • Webinars and ebooks in one click
  • Our Solutions of the Year magazine
  • Support solutions journalism and preserve access to all readers who work to liberate cities

Join 1096 other sustainers such as:

  • Gabby at $5/Month
  • Abigail at $10/Month
  • Gloria at $5/Month

Already a member? Log in here. U.S. donations are tax-deductible minus the value of thank-you gifts. Questions? Learn more about our membership options.

or pay by credit card:

All members are automatically signed-up to our email newsletter. You can unsubscribe with one-click at any time.

  • Donate $20 or $5/Month

    20th Anniversary Solutions of the Year magazine

has donated ! Thank you 🎉
Donate
×