Portland’s ‘formula business’ ordinance draws criticism

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PORTLAND (AP) – Portland’s new “formula business” ordinance is coming under fire after an outdoor sports retailer cited the ordinance in closing three stores and a franchise owner said it forced her to look elsewhere to open a business.

The City Council voted 5-4 in November to place a cap on franchise and chain businesses in response to a proposal to open a Hooters restaurant downtown. The ordinance limits the number of formula businesses in the Old Port and Congress Street areas to 23, the current number in the area.

The owner of Cadillac Mountain Sports this week said the ordinance played a role in his decision to close his three Portland stores, called Cadillac Mountain Sports, Cadillac’s Patagonia and Cadillac’s The North Face. Matthew Curtis said his stores were already struggling and that there’s little chance of a turnaround because of the ordinance.

Michele Tribou said the ordinance also cut short her plans to open a Heidi’s Brooklyn Deli, a franchise with 29 locations, mostly in Colorado, in the Old Port. Tribou said she is now looking at spaces in Falmouth, Auburn and other towns “that will accept me.”

Curtis said formula stores such as L.L. Bean and Olympia Sports draw people to his and other nearby businesses. By banning additional chain and franchise businesses, the city is limiting the prospect of increasing foot traffic on Congress Street, he said.

“We cannot continue to grow in Portland with this ban, and we cannot reverse our sales declines if Congress Street deteriorates,” Curtis said. “This ban is the opposite of everything I’ve learned about downtown revitalization.”

Besides capping the number of formula businesses, the ordinance also says future formula stores must be at least 400 feet from an existing one. A formula business is defined as a store or restaurant with 10 or more locations that use unified formulas for names, designs, logos, products and marketing.

A City Council panel is considering a proposed sunset provision for the ordinance that, if approved, would have the ordinance lapse after June 30 unless the council votes to extend it.

City Councilor James Cloutier said he continues to support the ordinance and opposes the sunset provision. He said he’s not surprised that sales are down at a winter retail business given the warm winter, but he finds it “hard to swallow” that Cadillac Mountain is closing its doors because of the ordinance.

The closing of the stores, he said, “isn’t something that throws the basic wisdom of (the ordinance) in doubt.”

Councilman Ed Suslovic, who opposes the ordinance, said the closing of Cadillac Mountain’s stores illustrates the “unintended consequence” of a measure he calls “ill-considered and hastily conceived.”

Curtis hired local people, provided good employee benefits and gave to community charities, Suslovic said. Cadillac Mountain owns five other locations in Maine, and would be considered a formula business if it had two more stores, he noted.

“He is the kind of guy and the kind of business that Portland should be courting, not slapping around,” he said.

Tribou said she was within a couple of weeks of closing on a commercial loan and had already put a $5,600 deposit on an Old Port location for a Heidi’s Brooklyn Deli. She said the deli will represent a total investment of about $300,000.

“Everything came to a screeching halt at that November City Council meeting,” she said. “It’s really disheartening.”



Information from: Portland Press Herald, http://www.pressherald.com

AP-ES-01-10-07 1110EST

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