Why a Small New York Town Is Banning New Restaurants

Protectionism takes many forms, but it always leads to the same end: fewer choices for consumers

Skaneateles, a town of 7,000 that rests at the north end of Skaneateles Lake, one of New York State's Finger Lakes, is considering a ban on new restaurants in the city's historic district.

The Auburn Citizen reported last week that the measure would prohibit new sit-down restaurants from opening along Genesee Street, which runs along the lake. That's despite the fact that the waterfront district that would be impacted is composed of approximately 60 buildings that are "predominantly of commercial" nature.

Why the ban? There must be hundreds of restaurants in the area, right? Well, no. Yelp lists no more than a handful of restaurants in the proposed ban area.

But that's probably plenty, according to Mayor Marty Hubbard.

"I think that Skaneateles certainly supports restaurants," Mayor Hubbard said last month before explaining the limits of that support. "We have plenty of restaurants, and we have plenty of area left in the downtown district…where restaurants, in fact, would be approved, and I think it's fair to say that the village very much supports restaurants. It's just this particular area has residents."

One person who won't feel the sting of the ban is Adam Weitsman, whose planned Mexican restaurant within Skaneateles's no-go area has already received the necessary permits to open. Still, Weitsman doesn't love the ban.

Weitsman told the Citizen that "'there's not a lot of variety' among Skaneateles' downtown restaurants when it comes to ethnic food and more affordable dining."

Save for Weitsman's Mexican restaurant, it's safe to assume neither variety nor affordability will improve after the ban.

The Citizen notes the ban was first considered last summer, when the planning board determined that "new restaurant development can destroy the value of one's home investment." (I'm a little bit skeptical.) The board considered that much of the area consists of "owner-occupied condominiums valued over $1 million." Indeed, the Citizen reports residents of those pricey condos generally support the move, while those outside the historic district are generally opposed.

Another worry cited by the city was the potential for "noise and smells," local news outlet LocalSYR.com reported last month.

The rationale for the ban appears to be a familiar mix of protectionism: protecting neighborhood character, protecting existing restaurants from competition, and protecting existing home prices.

This isn't the first restaurant ban I've written about here. For example, in 2013 (and again in 2015) I discussed the absurd ban on the construction of new fast food restaurants in South Los Angeles, a patronizing plan adopted by the city to combat obesity. Two RAND studies concluded the plan did not combat obesity, as everyone from The Atlantic to NPR to the L.A. Times reported.

Neither is the Skaneateles ban unique. For example, Gig Harbor, WA, about an hour's drive from where I live in Seattle, is currently considering a Skaneateles-style ban.

But the proposed Skaneateles ban makes for an interesting juxtaposition against the reasons behind your typical food-truck ban. Consider that prohibitions of food trucks around the country often rest on the (misguided) assumption that brick-and-mortar restaurants are somehow better for a community than are food trucks. (They're not better. Neither are they worse.) But Skaneateles takes that further, presuming that million-dollar condos are better for a community than are brick-and-mortar restaurants. (I wonder if the condo owners will feel the sting down the road when the town suggests two-million-dollar single-family homes are better for the community than are mere million-dollar condos.)

Regardless of the target—restaurants generally, fast-food restaurants specifically, food trucks, or any other food business—a ban like that proposed in Skaneateles or Gig Harbor is a counterproductive, dumb, and potentially illegal measure designed to protect one small subset of the population at the expense of other taxpaying residents and businesses, diners, visitors, and others. Whether or not a problem exists, a ban is really no solution at all.