Uncovering JAPA

Regional Planning Can Help With Environmental Impacts of Warehouses

In "Planning Matters: Institutional Perspectives on Warehousing Development and Mitigating Its Negative Impacts," Journal of the American Planning Association (Vol. 85, No. 4), author Quan Yuan confirms the assumption that permissive zoning regulations can lead to the disproportionate concentration of environmental impacts related to warehouses.

Yuan studied the effects of the warehousing industry in various municipalities in the Los Angeles metropolitan statistical area and argues that planning practice plays a key role in warehousing location choice. This is a timely project, given the proliferation of warehouse facilities, driven in no small part by the expansion of e-commerce.

While warehousing falls under the same zoning classification as industrial use, its growing presence in deindustrialized regions requires new land use strategies.

Warehousing's Growing Footprint Challenges Planners

As Yuan shows in his investigation, e-commerce leaves a significant footprint, which he analyzes in two ways.

One is the somewhat obvious impact of warehousing on land use patterns, as the ever-expanding building footprints of modern warehousing facilities encroach on greenfield land. Unlike facilities before 2000, contemporary warehouses use automation and need significantly more space. Suburban or exurban municipalities can offer the large parcels — above 10 acres — that the warehousing industry prefers, leading to the concentration of warehousing in certain municipalities.

The other type of impact, harder to quantify, is the environmental footprint associated with intensifying freight and warehouse operations. To mitigate such environmental impacts, Yuan proposes that municipalities should reach "[a] consensus on regulating warehousing-related externalities at the regional level."

This table outlines some of the tools planners can use to regulate and mitigate excessive warehousing development.

Table 6, warehousing JAPA article, Vol 85, No 4: Potential effective planning practices for preventing excessive warehousing development.

Table 6: Potential effective planning practices for preventing excessive warehousing development from "Planning Matters: Institutional Perspectives on Warehousing Development and Mitigating Its Negative Impacts," Journal of the American Planning Association (Vol. 85, No. 4).

Warehousing's Impact and Potential Regulations

Through interviews, a review of local regulations, and a comparative study of municipalities in Southern California, Yuan identifies several other factors that contribute to the spatial concentration of warehousing.

Warehousing developers make locational choices that maximize profits. Thus, land costs, labor costs, and tax incentives will factor prominently in these decisions. The increasing relevance of sales tax is of note. Because online commerce associated with fulfillment centers is subject to sales taxes, tax rates also influence warehousing locations.

Yuan's qualitative research supports the view that despite being an important source of tax revenue and employment, warehouse facilities exact a significant environmental cost at the local level.

Yuan's recommendations offer a useful, practical blueprint for interregional cooperation that municipalities can use to regulate warehousing development and minimize environmental externalities. Furthermore, the author's recommendations for preventing the concentration of warehousing-related environmental damage have implications for environmental justice, as most of the pollution cost is borne by low-income communities.

However, the competition between locations has historically, especially in times of economic contraction, led to a race to the bottom among municipalities seeking to expand their tax base.

Under what conditions might the proposed interregional cooperation between municipalities work not only to regulate development but also to prevent strategic, opportunistic behavior of local governments competing to create incentives for development?

Photo: Forklift and warehouse shelves (CC0 Public Domain).

About the Author
Elena Ion is a Master in Urban Planning candidate at Harvard University.

March 19, 2020

By Elena Ion