Capitalism, dollar stores and the role of the Apopka city council
By Reggie Connell, Editor-in-Chief
Are you a supporter of big government or small government as it applies to capitalism and economics?
Should elected officials stand aside and let businesses and the market pick winners and losers, or should they take an active approach to selecting and regulating the businesses and industries that come to its states, counties? and its cities? Should they try to improve the economy, or stand aside, let it prosper or fail on its own?
These are issues that have been debated repeatedly in the United States Congress, state legislatures, and city councils across the country.
In 2017, I asked the members of the Apopka Town Commission to define their role. This was after Apopka City Commissioner Kyle Becker took on then-mayor Joe Kilsheimer, recreation director David Burgoon and city attorney Cliff Shepard over a written contract for a tennis instructor using the Northwest Recreational Facility courts with whom he disagreed.
It was an interesting and somewhat lively discussion about the role that a commissioner plays (or does not play) in a contract with the town of Apopka and a private citizen, and it ties in with another question raised by Becker during the city council meeting last week.
“I understand that we have yet another dollar-type store to come thanks to the works of the DRC [Developmental Review Committee] process, ”Becker said. “And as for the location, it’s almost directly next to another existing dollar store that we already have on Rock Springs Road.”
Low-cost retailers, or dollar stores as they are commonly referred to, is something Apopkans seem to hate, the marketplace seems to love, and customers seem to patronize. Becker, however, sees a bigger problem at play.
“I wanted to bring it up again because there are some cities across the country that are tackling this problem,” he said. “And I call it a problem because it’s a problem.”
In 2010, there were 20,000 dollar discount stores nationwide. Currently, it stands at over 34,000 according to a study conducted on statista.com. To put that into perspective, there are more dollar stores than McDonald’s and Starbucks combined in the United States. In 2019, Dollar General’s net sales were nearly $ 27.8 billion, while Dollar Tree generated around $ 23.6 billion.
It’s a thriving industry, but it doesn’t stop at these numbers.
“They are very optimistic about their growth model,” Becker said. “Dollar General aims to put a thousand more [stores] in the system alone.
There are currently 12 dollar stores in Apopka and 16-20 in the immediate vicinity, with no obvious end to expansion in sight. But it’s not just store volume, but location that matters to Becker.
“They go to low income neighborhoods… that’s how they make their money,” he said. “People within these communities think they are meeting a need, but the long-term impact, especially from the perspective of healthy food options, all weighs on the fact that it doesn’t necessarily help those communities.
And the trend is doubtful to plateau anytime soon, given who the investors are.
“It’s just going to get sharper because a lot of them, especially Dollar General, have great support from Wall Street… it’s a publicly traded company. Their mission is to make sure their shareholders are happy – and they’re going to want to grow, grow, grow… that’s their model.
It would be easy to dismiss this type of growth, if not applaud it. That’s what capitalism is, and it’s good for the economy. If the consumer doesn’t like what they offer, then a lack of demand is pushing them into bankruptcy without the government interfering with the right of law-abiding businesses to thrive or fail on their own terms. merits. But what’s the line for lawmakers regulating industries and establishments that come into their municipalities? For Becker, it starts with what’s good for the community.
“You would think that 12 [dollar stores] in the town of Apopka – [where] we have about 30 square miles … it might not be that big of a deal, but what usually happens is you have a high concentration of these type of stores – which deters other small ones grocers, other big box retailers that people want because they have more options, more options for fresh produce – it keeps them from going to those areas where you have a high concentration of small priced stores reduced. “
This is one of the reasons Becker called for a more planned approach to business in Apopka.
“During my two terms, I repeatedly advocated for a city-led economic development program. Sadly, we still don’t have one, and this continued proliferation of discount stores is precisely why we need to do something now. We have to go on the offensive and stop being satisfied with what comes our way. Dollar General or Dollar Tree are not expected to dictate our city’s retail and grocery landscape for years to come. “
And with large corporations raking in huge profits for their shareholders, some believe that a certain amount of job creation, community service, and involvement in improving Apopka is appropriate. Becker doesn’t see that kind of surrender with dollar discount stores.
“You could say that these companies have an economic impact. These companies would like you to think that is the case. But in reality, few jobs are coming and making sense in the communities they serve. I see little to no reinvestment at all. I don’t see any [Apopka Area] Chamber website where they have a representation of the chamber. So I don’t see that they would give back to the community like Publix does, or to other corporate sponsors like AdventHealth. I don’t see the overwhelming economic impact that these stores bring. “
However, he sees the downsides they have in a low income community.
“They target depressed areas. And I think it causes [the areas] being in a constant state of depression because people go to these stores with the belief that they are going to get a better deal on housewares or food, but if you look at the price per unit you can buy a 20-a ounce of ketchup at Dollar General for a dollar, but the unit cost is less in a grocery store.
And then there are health issues when dollar discount stores dominate a community’s buying options.
“Many stores go to places considered food deserts, which means accessibility to fresh food is over a mile from your home. Either they perpetuate it or they make it happen. For the most part, only 5% of Dollar Generals even offer fresh produce. In the state of Florida, we have $ 938 general. They sell, for the most part, high calorie, highly processed foods, and this discourages normal grocers from offering healthier foods in nearby areas.
At the end of his presentation, Becker asked city staff to explore ideas for limiting the acceleration of dollar discount stores in Apopka, as other cities have done.
“I don’t think I’m saying we put a total ban on these types of establishments,” Becker said. “But I think there are smart ways to plan their growth in this region if it is planned – and there is no suggestion that it is not.”
Becker referred to two ideas to limit their growth: grocery store classification distinctions and buffer zones.
“We can further define our classifications of grocers based on their square footage and percentage of food supply to indicate how much fresh food they have available for their customers, then create a certain level of buffer requirements.” . Birmingham [Alabama] has a one mile buffer zone. “
For the most part, city commissioners agreed with Becker’s request to city staff.
“I support it because I think we have enough dollar stores,” said Commissioner Alexander H. Smith. “And as Commissioner Becker said, they don’t reinvest in the community. When we had the family business debate that had been approved to open here, but Dollar General came in and got it under control. They [Dollar General] committed to reinvesting in the community, and none of that happened. Not an iota. “
“The issue too is the legal aspect of this,” said Commissioner Doug Bankson. “Are we allowed to have tampons?” Typically we’ll have grocery stores like Publix or Albertsons competing, but I think it’s a great approach and obviously other cities are doing it.
Apopka City Attorney Michael Rodriquez believes there are ways to regulate dollar stores through both buffer zones and justified restrictions.
“Many cities across the country have imposed distance requirements,” Rodriguez said. “As long as there is a rational basis, this is something that can be defended under zoning.”
“How come cities like Windermere don’t allow stores like this in their community?” Asked Commissioner Diane Velazquez. “And what do they have in their codes to prevent stores like this from entering their community?”
“It depends on how their codes are written and when they are written,” Rodriguez said. “Local governments can justify banning certain uses. The city of Boca Raton does not allow car dealerships. “
“I support what Commissioner Becker is asking… that our staff look into this issue,” Velazquez said. “We can definitely have something in place that says dollar stores can’t be side by side.”
“We will ask the staff to do a thorough study and see what would be the appropriate mechanisms to properly regulate this and not infringe on the property rights that these uses have,” Rodriguez said.
So what is the appropriate action for a municipal government to take in business matters? Becker believes there is a formula that falls somewhere between over and under regulation – that sweet spot called effective governance.
“I’m pro-business and I want to see our community of local small businesses thrive, as well as corporate brands that reinvest in Apopka,” Becker said. “When it comes to exploring regulations, there is no perfect formula for when and how much; However, I firmly believe that it is important to take advantage of long-standing and generally accepted planning practices to establish permitted use classifications, create stacked neighborhoods, or other development requirements to promote a healthy mix of types of businesses in our city. “