Towns and cities have broad authority to reject dollar store development if they believe it is not in the best interest of the health, safety, and welfare of residents, according to a court ruling in a little-noticed case last November. This could be welcome news to communities pushing back against the explosive growth of dollar stores.
Chains like Dollar General, Dollar Tree, and Family Dollar are targeting communities all over the US, expanding at an unprecedented pace. The number of chain dollar stores has soared over the past decade, putting one within a five-minute drive of almost every American.[1] As dollar stores have multiplied, the problems they create have multiplied, also. They attract violent crime.[2] They put their workers and customers at risk of physical injury.[3] They siphon sales away from locally owned businesses – particularly from grocery stores, which are vital community anchors.[4] They overcharge customers through chronic scanning errors.[5] They sell expired food and medications.[6] The list of problems goes on and on.
But communities are beginning to turn them away. Over 120 towns and cities have rejected proposed dollar store developments, and more than 60 have put laws in place that limit their expansion. Most of these battles have focused on whether a dollar store is or isn’t allowed under a community’s zoning code. But a district court’s decision, in Dorsey Development DG LLC versus Tangipahoa Parish Council–President Government and Tangipahoa Parish Planning Commission, takes a broader view of a local government’s authority. The court’s decision recognizes a local government’s responsibility to protect the community’s well-being by, in this instance, refusing to allow development of a business model that exacerbates traffic congestion, attracts crime, endangers workers and customers, and harms local businesses, among other injuries. The court’s ruling could open the floodgates for many more communities to prevent dollar store proliferation.
| To fight dollar store chains in your community, check out our Strategy Guide and 17 Problems: How Chain Dollar Stores Harm Communities, a comprehensive accounting of these stores’ economic and social impact. |
Here’s what happened. In March 2023, Tangipahoa Parish, Louisiana’s Planning Commission rejected a development application from Metarie-based Dorsey Development Group to construct a building for Dollar General on an unzoned, unincorporated parcel of land just outside the town of Ponchatoula, citing concerns for the “health and safety” of the Parish’s residents.[7] The Parish already had eight chain dollar stores, and, based on their observations and experiences, Commission members were wary of the traffic problems, stormwater runoff issues, blight, and harm to existing businesses that the proposed dollar store would likely create.[8]
The developer’s representative appealed the Planning Commission’s decision to the Tangipahoa Parish Council, which heard his request at its next meeting. After public comments and discussion, no Council member offered a motion to grant the developer’s appeal and to approve the application, so the Planning Commission’s decision prevailed.[9]
The developer then sued the Parish, arguing that the Planning Commission’s decision to deny his development permit and the Council’s tacit support of the Commission’s decision had been “arbitrary and capricious” and had no rational basis, since the proposed development plan met all the Parish’s technical site requirements. But Louisiana district court judge Brian Abels disagreed, supporting the Planning Commission’s decision.
The Planning Commission’s action was based on a local government’s authority to use its “police power” to protect the health, safety, and welfare of its citizens.[10] The police power (the term comes from “policy”) derives from the Tenth Amendment to the U.S. Constitution, which states that, “The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”[11] The federal government retains some police power for itself, then delegates the remainder to states which, in turn, retain some for themselves and delegate the rest to local governments.
At the local level, police power generally encompasses regulations that promote public health and safety and that discourage unhealthy or disorderly activities. Public health codes, building codes, professional licensing requirements, and other regulations that protect the public good are all examples of local police power. Local governments have used the police power to protect wetlands,[12] regulate automobile towing,[13] prohibit fracking,[14] and ban smoking in public places,[15] among many other things.
Judge Abels’s November 14, 2023 ruling focused on whether Tangipahoa Parish was correct in using its police power to reject Dorsey Development’s application. Abels’s six-page decision explained that Louisiana’s constitution gives localities the authority to regulate land use and that, even though the Parish had chosen not to zone the particular property in question, the Parish could nonetheless regulate land use through ordinances, as long as it does so with consistency and without prejudice.
In his ruling, Abel carefully outlined each step in reaching his conclusion. He began by citing Tangipahoa Parish’s development ordinance, which specifically gives the Parish the authority to “promote the public health, safety and general welfare.” He then explained that, even though a proposed development might conform with applicable ordinances, the Parish can still reject a proposal if it is “rationally related to legitimate governmental interests like public health, safety, and the general welfare.”[16] Finally, he carefully evaluated the credibility of each of the Parish Planning Commission and Council members who testified in the trial, concluding that each of them had legitimate, credible concerns about the negative impacts the proposed store would likely have.
Judge Abels’s decision is significant for the many towns and cities pushing back against the rapid growth of chain dollar stores. Communities may now be on firmer ground in rejecting dollar store development proposals, and courts now have a solid precedent for supporting local government decisions to turn away dollar stores. Tangipahoa Parish could be paving the way for countless other communities to stop dollar store proliferation.
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Notes
[1] Leticia Miranda, “Thousands of retail stores are closing – so how is Dollar General opening almost 20 stores a week?,” NBC News, December 5, 2019.
[2] Alex MacGillis, “How Dollar Stores Became Magnets for Crime and Killing,” ProPublica, June 29, 2020.
[3] Aimee Picchi, “As dollar stores spread across the nation, crime and safety concerns follow,” CBS News, September 6, 2023.
[4] El Hadi Caoui, Brett Hollenbeck, and Matthew Osborne, “The Impact of Dollar Store Expansion on Local Market Structure and Food Access,” SSRN, June 22, 2022.
[5] Ramenda Cyrus, “Dollar General Overcharges ‘Hundreds of Thousands’ of Customers, Lawsuit Alleges,” The American Prospect, January 19, 2024.
[6] Jasmine Wu, “Dollar General and Dollar Tree fined $1.2 million for selling expired drugs, NY AG says,” CNBC, August 26, 2019.
[7] Richard Meek, “Judge denies Dollar General suit,” The Daily Star, November 17, 2023.
[8] “Minutes of the Tangipahoa Parish Planning Commission,” Tangipahoa Parish, March 7, 2023.
[9] Richard Meek, “Parish council denies Dollar General application,” The Daily Star, April 1, 2023.
[10] Brian W. Ohm, “Some Modern Day Musings on the Police Power,” The Urban Lawyer, Vol. 47, No. 4 (Fall 2015).
[11] United States Constitution, Amend X.
[12] Rock-Koshkonong Lake District v. DNR, 2013 WI 74.
[13] King v. Town of Chapel Hill, 749 S.E.2d 844.
[14] County of Mendocino, California Municipal Code §8.05.
[15] City of Amarillo, Texas Code of Ordinances §8-5-281 – §8-5-289.
[16] Dorsey Development DG, LLC versus Tangipahoa Parish Council–President Government and Tangipahoa Parish Planning Commission, No. 20230001298, 21st Judicial District Court, Division “D”, November 9, 2023.
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