A significant part of the locally-owned business community is made up of home-based businesses. Home-based businesses are the ultimate incubator that allows entrepreneurs to develop their company while keeping their first job and allows parents to raise their children while working at the same time.
Home-based businesses have the widest potential in the business world. They can grow as small or as large as their business plan. Most remain in the home, while some evolve into local retail and office. A few have expanded into global corporations. The Coca-Cola Company and Apple Computer both began as home-based businesses.
But what if the local community sends mixed messages about the acceptance of this form of enterprise? Or is openly hostile to it? What is an entrepreneur to do when zoning ordinances are so restrictive as to make it too difficult to function? This is a case study of a new city trying to find its way between forging a specific identity and meeting the needs of its diverse citizenry.
Background: City of Dunwoody, Georgia
The City of Dunwoody was incorporated in 2008 by local referendum. The area was previously part of unincorporated DeKalb County and subject to a county-based legislature and law enforcement. The move to incorporate a local government came from growing conflict with county government over lack of code enforcement. The local citizens routinely organized their own “code enforcement” via neighborhood watch and the homeowners associations were the only thing approaching a local legal structure. The community saw overdevelopment of residential areas and building in violation of the county’s own zoning codes. All with the county government’s blessing and with no input from local citizens. As soon as the opportunity came, incorporation passed by a vote margin of 4-to-1.
Dunwoody reports 46,000 residents, about 54% of which are single-family homeowners. Business taxes make up the majority of the city’s revenue. The last available statistics report 2,500 businesses licensed by the city; over 60% of these are locally owned enterprises. 20% of all business licenses are issued to home-based businesses. A home business license comes with very strict limitations that were copied from DeKalb County’s zoning ordinances on the city’s incorporation.
The State of the Law
The ordinance requires that a home business make no impact on the neighborhood around it. In addition to the usual requirements of “no noise, no smoke”, etc, there can be no signage advertising the business inside, and there can be no in-person customer contact at all.
At first blush, this restriction is a great idea. Who wants to settle into a nice quiet neighborhood and have a retail strip mall pop up in the houses across the street? Or an auto mechanic’s shop next door? But the ordinance doesn’t stop there. “No customer contact” leaves no room for interpretation or exception. So a one-to-one meeting over coffee with a friend who happens to be a customer is forbidden. Retail parties by such companies as Avon, Pampered Chef, Stella and Dot, etc are illegal. It doesn’t take much to cross the line from “protection of neighborhoods” to “prohibiting common residential activity”. Home business owners are also vulnerable to complaints that stem a personality conflict or activist’s agenda, instead of business practices.
During the course of developing city zoning code, a change was made that would allow home businesses that could demonstrate that customer contact would not interfere with the residential neighborhood to file an application for a Special Land Use Permit (SLUP). The application required detailed information about the house in question, the street and a series of three public hearings: two in front of local commissions, one in front of city council. City Hall advised that letters from the immediate neighbors would be helpful. On paper, the SLUP intended to strike a balance between the desire to preserve residential neighborhoods as strictly residential, and allow a home business owner a shot at showing their customers were not a threat to that standard. The change was approved and added to the Zoning Ordinance without a whisper.
In 2011 a Dunwoody homeowner filed the first SLUP application to teach music lessons at home. The application was meticulous: diagrams showed plentiful and discreet private parking, photos and floor plans showed a room for a studio screened from other houses. Every contingency had been planned and many immediate neighbors submitted letters of support for the plan. All public announcements were made through all legal channels. The first round of reviews by city commissions was almost anticlimactic. But the smooth legal process hit a speed bump.
First the orderly process on paper was held up by the city attorney who noticed some inappropriate wording in the ordinance. He decided that the previous hearings were null and void. The applicant had to go through the review process all over again – from the beginning.
Second, local activists, accustomed to mounting loud, organized protests in response to any zoning change by the county, mounted a low-ball campaign against this application. These people had evolved a unilaterally defensive posture against any lifestyle that varies from their own and they are used to their efforts being accepted and encouraged by the city fathers. Interestingly enough, none of the handful of objectors lived on the street of the proposed music lessons, nor did they make any attempt to speak with the applicant about her proposal. At the second public review, they spoke against the proposal with fabricated objections, based around alleged traffic problems and safety of local children, and alleged noise. The applicant’s neighbors were outraged and turned out to the new round of public hearings to defend the application and criticize the opponents’ tactics.
Ultimately, after spending hundreds of dollars and several months of public hearings, news stories, and abuse from community activists, the applicant got her permit to see music students in her home. It was a marginal victory, as the amount of effort it took to achieve the permit was far greater than the effort to see a student in her home. Over the several months since her permit was granted, the neighborhood has remained peaceful and all of the “concerns” stated by those opposed to her SLUP proved false.
The collateral damage was extensive. The homeowners association led by the aforementioned activists lost membership and even some board members. The fragile trust between the local business community and the city government was all but shattered. Not a single home business has made a SLUP application to see clients at home since this incident. All other home businesses that may see customers at home do so under the radar. It is Dunwoody’s own version of “Don’t Ask, Don’t Tell.”
This month, after new Council Members were elected, an amendment was proposed to reduce the length of time, the amount of public hearings, and cost of a customer contact SLUP. The amendment would have allowed customer contact by right with significant limitations to protect neighboring homeowners. The amendment was taken out of the approval process at the outset. To add insult to injury several council members expressed that home business owners were not capable of having even one customer at a time without being a nuisance. Needless to say the home business community was thoroughly offended.
Today, the Dunwoody city council is scheduled for a daylong retreat. One of the items that “may” be informally discussed is the SLUP application process. Priorities for issues will be set at the retreat so no one knows if it will make it to the floor for a hearing or not.
The Dunwoody Chamber of Commerce board convened this week and decided that the home business segment of the business community needs their support and advocacy. They have begun conversations with city hall and are gathering statistics for an independent review of the impact of home businesses in advance of implementing a support program and advocacy statements.
Home business owners – including our music teacher – are going about their business, making a living as they need to. Some of them may be seeing a client or two. They’ll never admit it now.
Adrienne D Duncan
Owner, SDOC Publishing Internet Solutions