Maine’s lawmakers should let towns easily opt out by passing LD 1962

The state Legislature will shortly debate whether to adopt LD 1962. This bill, sponsored by Sen. David Hastings, R-Fryeburg, would allow Maine communities to opt out of complying with the extraordinarily burdensome review process required by the Informed Growth Act.

The Informed Growth Act applies to every proposed retail facility of 75,000 or more square feet of floor space. It requires local planning boards to review the potential economic impact of the store on existing retail establishments, as well as wages in the area. When a developer submits an application, they are required to pay up to $40,0000 to finance the costs of the study, including hiring a consultant to advise the local planning board.

The Informed Growth Act does include language allowing communities to opt out of complying with its provisions – however, as presently written, opting out is almost as onerous as complying with the law. In order to avoid the review required by the act, a community would have to adopt ordinances requiring it follow essentially the same process which it was attempting to avoid.

Sen. Hastings’ bill would allow a municipality that did not want to go through the burdensome and complicated review to opt out, via referendum. There are several reasons why a community might choose to opt out of the Informed Growth Act:

First, a municipality might conclude that developers of large retail stores would be discouraged from submitting development proposals in the face of such a complicated and expensive review process. Phil Nadeau, Lewiston’s deputy city administrator, testified before the State and Local Government Committee in favor of LD 1962, explaining Lewiston was trying to attract such substantial businesses.

He expressed concern developers would be discouraged from locating in Maine because of the burdensome review process required by the Informed Growth Act. He noted Lewiston has a sophisticated planning process in place, has designated areas where big-box stores are appropriately sited, and was able to handle the decision-making process at the local level.

Another reason local communities would opt out of compliance is that it imposes unprecedented burdens on the local planning boards. Although planning boards have never been required to assess the economic impact of a proposed development on existing businesses and area wages (including wages in other towns which might be affected), and have no expertise in doing so, they are required by the Informed Growth Act to undertake such an analysis.

Local communities might also want to opt from compliance because they do not want to be drawn into lawsuits. The Informed Growth Act raises serious constitutional issues. The U.S. Supreme Court has held that the Commerce Clause of the U.S. Constitution forbids a governing body from discriminating against a proposed new business in order to protect existing businesses. Yet this is precisely what the Informed Growth Act appears to require.

So a municipality could face a lawsuit from a large retailer, like Wal-Mart or Costco, that alleges their failure to receive a building permit under the Informed Growth Act was the result of unconstitutional discrimination in favor of existing businesses.

The members of the State and Local Government Committee who opposed Sen. Hastings’ opt-out amendment concentrated on defending the Informed Growth Act itself. They argued that the Informed Growth Act would provide local planning boards with valuable information in deciding whether to allow a new big-box store to locate in town. Although well-intended, these comments missed the point.

Any community that believes it can benefit from the review mandated by the Informed Growth Act would have no reason to opt out. The real question is whether communities that would welcome a new Wal-Mart or other large retailer, and those who feel they can manage their affairs without being told what to do by Augusta, should be able to avoid compliance with the burdensome review process mandated by the statute.

At the bill’s work session on Feb. 6, the committee voted 6-5 “ought not to pass” on LD 1962.

Since the committee was essentially deadlocked, and since LD 1962 is a nonpartisan bill, there is no reason the Legislature shouldn’t support Sen. Hastings’ bill when it comes to the floor for a vote.

Curtis Webber is a municipal and employment law attorney with Lindell, Choate & Webber in Auburn.