Issues & Insights

Lifting Zoning Restrictions Would Get Americans Back To Work During The COVID-19 Crisis

As the country grappled with the coronavirus pandemic, widespread shutdowns forced businesses to close – some permanently. With so many businesses closing at once, Americans were left searching for a way to make enough money to get by.

As social distancing and working from home became the new normal, many jobless Americans turned to home-based businesses to put food on the table for their families. The good news for aspiring entrepreneurs is that the internet gives many the option to put their home spaces to productive use. Well, it would be good news if the government would just get out of the way.

A maze of vague zoning regulations and onerous permitting requirements prevent many from starting businesses out of their own homes. From Nashville to San Diego, these restrictions have destroyed home businesses ranging from private tutoring lessons to music production to tax services. Some cities even prevent home-based entrepreneurs from employing other remote workers ― an absurd restriction in the best of times and even worse when workplace social distancing is necessary.

Fairfax County crushed the online clothes-selling business of Virginia mother and entrepreneur, Marietta Grundlehner. She ran afoul of the county’s home-business restrictions by storing products in her own house. Nonsensically, the county’s zoning laws would have allowed her to manufacture the clothing in her home – a much more disruptive practice – but evidently, keeping the clothes in her own house was a step too far. Unfortunately, shutting down productive and harmless businesses such as Grundlehner’s is a routine activity for many localities.

These restrictions hit small home businesses much harder than large companies, which are better able to shoulder the costs of zoning compliance and overhead. And because these restrictions often prevent home businesses from starting up in the first place, it is impossible to calculate their full cost. Even when viruses aren’t shutting down traditional workplaces, banning home businesses needlessly blocks families from feeding and caring for their own children.

Work flexibility and the relatively inexpensive start-up costs of home-based businesses often attract single parents and low-income individuals, only for them to find their livelihood deemed illegal, and their business shut down. That is what happened to Phoenix resident Kim O’ Neil, whose home-based medical billing service was closed by the city despite having no visiting customers or on-site employees.

The internet has made home businesses more popular in recent years; however, they are far from a phenomenon of the modern age. Indeed, using a home for business purposes is a timeless property right that pre-exists even the founding of this nation. Before the Industrial Revolution, operating a business out of the home was the norm. The government should not burden that longstanding property right with senseless and harmful zoning ordinances that cripple entrepreneurship and prevent people from making a living during a crisis like the coronavirus epidemic.

Proponents of banning, or requiring expensive permits, to operate home businesses insist that the restrictions are necessary to limit noise and traffic and to preserve the character of neighborhoods. But most localities already have nuisance ordinances in place that prevent the potentially adverse effects of home businesses and allow people harmed by truly disruptive neighbors to seek compensation. Proposed reforms that would allow home businesses to survive also demand that those businesses be secondary to the property’s use as a home. In other words, lifting harmful home business restrictions will not turn neighborhood homes into gas stations or mechanic shops. But it could give your neighbor a better shot at getting to work and helping save our economy.

An entrepreneurial spirit is one of the defining characteristics of American culture. When problems arise, entrepreneurs such as George Washington Carver and Steve Jobs step up to the plate to devise solutions. Entrepreneur-run home businesses already fill an essential role in addressing unemployment, with more than 50% of existing home businesses employing at least 10 staff members. The COVID-19 crisis left many people suddenly unemployed, creating an even higher demand for such solutions. As a result, state lawmakers face significant pressure to promote job creation and get people back to work. An excellent place to start would be uncapping the potential of home businesses by lifting the innumerable, counterproductive obstacles to home-based entrepreneurship and letting people pursue their American Dream.

Joshua Polk is an attorney at the Pacific Legal Foundation, which litigates nationwide to achieve court victories enforcing the Constitution’s guarantee of individual liberty and, amid the current pandemic, restoring freedoms necessary to rebuild America.

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2 comments

  • Actually, most zoning regulations allow and even encourage home occupations. If readers look up ‘home occupations’ in the zoning ordinance of the community they live in, they should find that home occupations are allowed, often without any permit. Home occupations typically restrict those that are noisy, emit odors, generate traffic, have employees in the home (creating traffic and parking problems) or store materials (usually this only applies to outside storage where it can be seen). The article’s mention of home businesses with at least 10 employees makes me wonder – if those people were coming on a daily basis to the residence next door to his house, how happy would he be?

    • Hi Ben, thanks for your comment. I do not mean to suggest that all local jurisdictions prohibit home-based businesses; however, home occupation restrictions are more common than you might think. As I mentioned in the article, nuisance ordinances already prevent many of the potential negative externalities of HBBs (and they do it with a reduced risk of meddlesome neighbors and bad faith actors – also more common than you might think). Many HBB employees work remotely, and I would not be opposed to my neighbors running HBBs so long as they are not unreasonably disrupting the use and enjoyment of my own property (the common standard for nuisance).

      I recommend that you and other readers follow some of the links I included with the article to get a full picture of why particularly onerous zoning restrictions and criminal penalties are rarely the answer. You can also look into the Goldwater Institute’s work on the issue. Christina Sandefur has given a lot of attention to the matter, and I think she also makes a compelling case for reducing/eliminating HBB restrictions.

      Again, thanks for the comment.

      Best,

      JP

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