The Astoria City Council has begun defining the types of chain restaurants and hotels it could restrict to protect independent businesses.
A growing number of cities have been enacting prohibitions to prevent the spread of formula businesses that can squeeze out smaller competitors and drive up rent. Formula businesses include standardized services, merchandise, signage, decor, architecture, uniforms and other aspects that make them similar to other locations.
Mayor Bruce Jones, who broached the idea of restrictions, recounted a previous discussion where he mentioned that failure is easier to define than success.
“‘Failure,’ I said, ‘Would be coming over the hill from (Astoria) Crest Motel and seeing a big Olive Garden sign, an Applebee’s sign,’” he said. “And then, you know, you’re not in Astoria anymore. You’re in any one of the thousand anonymous suburbs in America.”
City Planner Barbara Fryer has been researching how different communities approach prohibitions.
“They’re pretty much throughout the country — the Midwest not so much — but the rest of the country, pretty much,” Fryer said. “A lot of California communities, especially coastal communities, regulate these businesses.”
Cannon Beach prohibits restaurants with standardized arrangements, without a specified number of locations. Bainbridge Island, Washington, prohibits formulaic fast food and takeout restaurants with disposable containers. Bristol, Rhode Island, bars formula restaurants larger than 2,500 square feet from downtown. Port Townsend, Washington, restricts formula businesses to a single highway commercial zone and to no more than 3,000 square feet.
Astoria cannot prohibit businesses based on ownership. City Manger Brett Estes brought up the issue of ownership groups like Texas-based Landry’s Inc., which owns chains like Joe’s Crab Shack, but also unique operations like Portland City Grill. Fryer brought up Provenance Hotels, a hospitality company that owns unique operations like Hotel Lucia in Portland.
City Councilor Tom Brownson said such chains with unique operations should be allowed. Councilor Jessamyn West argued that such ownership groups are no different than a corporation, with money flowing up to shareholders.
“That’s not that different than the Fairfield or the Marriott,” West said, referencing a controversial hotel proposal in Astoria. “It’s just the buildings look different.”
Fryer reminded West that ownership and where the money goes are not land use decisions. West said it is still a consideration for her.
Sarah Lu Heath, executive director of the Astoria Downtown Historic District Association, said there are situations in which global chains opening a new outpost in Astoria could be beneficial. Selina, a global chain of unique hotels started in Central America, recently leased the Commodore Hotel, one of its North American locations.
City councilors struggled over how to regulate regional chains such as McMenamins, a Portland-based company with more than 60 locations around the Pacific Northwest, usually in repurposed, existing buildings; and Burgerville, a fast-food chain based in Vancouver, Washington, with fewer than 50 locations.
Fryer pointed out that despite the unique locations, McMenamins shares similar menus, uniforms and other formulaic characteristics. “You know you’re in a McMenamins when you’re in a McMenamins,” she said. “It does have that standardized feel.”
City Councilor Joan Herman wanted a lower number of allowable locations, worried that chains of even McMenamins’ size could squeeze out smaller competitors. Jones thought the cap on the number of locations, along with requirements of dissimilarity, would solve most issues.
Councilors ultimately moved toward defining formula businesses as those with at least 12 U.S. locations sharing at least two formulaic similarities, or any chain with 75 or more locations. The prohibitions would be limited to restaurants and lodging.
Councilors also reached a consensus on capping the number of drive-thru formula restaurants such as McDonald’s, Burger King, KFC, Subway and Dairy Queen to the current number. Such restaurants could transfer their licenses to other chains upon closing.
City staff will propose a draft amendment to the Planning Commission, which would send a recommendation to the City Council for approval. Jones stressed that the city wants a thriving local economy that maintains its unique characteristics.
“We’re not anti-business,” Jones said. “We’re pro local businesses and pro those types of businesses that we’ve seen be successful in town that are consistent with the community’s feel and appearance.”