Small Towns Reap Big Rewards After Eliminating Parking Minimums

As their name suggests, small developers might be "small," but their benefits could prove to be mighty for Haltom City. Chicago learned this valuable lesson recently, when the City Council passed a major zoning ordinance slashing parking mandates across most of the city. By removing the expensive requirement for a minimum number of parking spaces, the city made it more financially feasible for small developers to undertake projects, especially infill projects. An infill project is reconstruction or redevelopment of buildings on smaller lots in existing urban areas, such as former industrial sites. In short, the process involves resuscitating structures that have been neglected or abandoned.

Lawmakers in Philadelphia, Pennsylvania realized that access to financing frequently prevented small developers from taking on projects in the city. To remedy that, they implemented the Capital Consortium policy, a streamlined process that provides a one-stop, single-application portal for small developers seeking loans for projects. Now, Chicago and Philadelphia are large cities, so to be fair, let's compare apples to apples and talk about some smaller cities that have taken important steps to attract small developers.

Staunton is a small city with population of about 26,000 in the Commonwealth of Virginia. The Historic Staunton Foundation decided to offer free design assistance to small business owners who agreed to restore the façades of their downtown buildings. Now, this might sound insignificant, but it inspired other business owners to jump on the bandwagon as well. The revitalized downtown section of Staunton now boasts five vibrant historic districts. Leaders in the Village of Mount Morris, New York (population 2,847) set up a revitalization program that provided developers with an inventory of all downtown buildings, including information on ownership, rental costs, and physical characteristics of the structures. This effort led to a significant increase in private investment in downtown buildings.

You might be wondering what small developers can do to help Haltom City. According to Haltom United Business Alliance Communications Director Joe Palmer, small developers offer a wide range of benefits for a small municipality such as Haltom City. "Unlike large-scale projects that can drastically alter a city's character, small developers tend to focus on less sizeable and more affordable projects," Palmer said. "Their participation sometimes can help reduce community opposition, making the development process smoother and more predictable. Since small-scale projects are often more in character with the existing neighborhoods, these developers tend to face less vocal opposition than large-scale developments."

Additionally, small developers often lean toward renovating existing properties, which translates to preservation and community revitalization. They are willing and able to convert underutilized properties into well-maintained, small-scale developments. Small developers also have an advantage over larger firms, mainly due to their familiarity with local market dynamics. Essentially, they have the ability and time to do their research. This allows them to better evaluate project pros and cons, and as a result design projects that meet the unique needs of the community.

Despite these benefits, small developers often face challenges with financing and regulations. Palmer said there are several simple steps Haltom City can take to give a boost to small developers, starting with the elimination of restrictive zoning laws, especially parking minimums. "These outdated and unnecessary parking requirements significantly increase development costs, and effectively serve as a deterrent for small developers," Palmer said. "Most importantly, the parking minimums need to be eliminated." Removing parking mandates is a great first step to encourage small developers, especially those who are local and interested in investing in their community, Palmer said. And the benefits of this reform can be realized by any community, large or small.

Another way Haltom City can encourage small developers is to simplify and streamline permitting, a process that Palmer said is often lengthy, complex, and expensive. "There are basic steps our leaders could take to make the permitting process far more user-friendly," Palmer said. "If a small project meets specific criteria, approval is given without making everyone grind through a long public hearing process." Palmer also suggested Haltom City leaders reduce or waive administrative, planning and impact fees for small projects, as they tend to disproportionately affect the finances of small developers.

"They can offer subsidies or tax credits to provide incentive for small developers," Palmer said. "Grants and low-interest loans for little projects can provide a much-needed shot in the arm for small developers. And offering vacant or tax-delinquent lots is a great way to give small developers an affordable path to ownership," he added. City leaders can initiate programs to provide small developers with mentorship, resources, and technical assistance, including training on project management; financing; and navigating local policies. They can host workshops to help small developers understand the process for bidding on city-related development and construction contracts. A city government liaison can help guide small-scale projects through the various steps, ensuring the process flows smoothly and doesn't get hijacked by bureaucratic red tape.