Residents of North Elba, New York spent five years trying to stop Wal-Mart from erecting an 80,000-square-foot store within their town. The town’s planning board rejected the retailer’s plans in January 1996, citing several reasons including the fact that "the project will likely result in a large amount of impacted retail space (83,000 to 114,000 square feet), which could take up to 14 years to refill, over 20,000 square feet of which could become chronically vacant. These potential impacts would have a significant unmitigatable adverse impact on the character and culture of the community by resulting in vacant storefronts, a loss of ‘critical mass’ in existing downtown areas, and an adverse psychological, visual and economic climate."
Theplanning board was sued by Wal-Mart, which claimed its decision was unsubstantiated, arbitrary and capricious. Wal-Mart argued that the rejection of its proposal was based on impermissible considerations, including the economic impact of the development. A New York appellate court upheld the planning board, finding that although its decision"refers to the economic effect the proposed store would be expected to have upon other local businesses, it does so in the context of assessing the probability and extent of the change it would work upon the overall character of the community, as a result of an increased vacancy rate among commercial properties in the downtown area—an entirely proper avenue of inquiry. . ."
The ordeal prompted the community to enact a size cap ordinance limiting single retail stores to 40,000 square feet and capping shopping centers at 68,000 square feet.
Enactedin February 1998, North Elba’s retail size cap was part of a larger law that amended various parts of the Town Land Use Code. The relevant portion is excerpted here.
Section 12. Part V Section 17 (D) of said local law is hereby amended by adding a new subparagraph (22), to read as follows:
(22) Retail Trade Uses; Grouped Retail Business Uses.
A.An individual Retail Trade use shall not exceed 40,000 square feet of floor area, whether in one building or more than one building.
B.A Grouped Retail Business Use shall not exceed a total of 68,000 square feet of floor area, in all buildings which constitute the use.
C.For the purpose of the size limits set forth in clauses A and B, floor area shall include floor area or floor space of any sort within a building as well as exterior space used for sale or storage of merchandise.