The City of Phoenix decided a vibrant arts district would be a nifty idea to revitalize its downtown core. Too often, cities are tempted to achieve such a goal by taxpayer subsidies, eminent domain, tax hikes, or draconian zoning requirements. Instead, Phoenix decided to try a different approach --deregulation.
The City is proposing an arts, culture and small business overlay that eases zoning restrictions and increases the number of activities that no longer need a special permit in a small area near downtown. New businesses such as art galleries, bookstores, and restaurants will be allowed to operate without special permission. Restrictions on alcohol sales, musical entertainment, and outdoor dining will be relaxed. The City also will make it easier to rehabilitate existing structures.
The City's action is a rare win-win. A shaky neighborhood will be revitalized. Small businesses will flourish. Phoenix will have its own version of SoHo. City tax revenues, depleted by recession and tax giveaways, will grow. And less regulation, not more, will be the reason for progress.
The plan is not perfect. Here as elsewhere, the City is ratcheting up restrictions on street vendors, thereby limiting an important avenue of entrepreneurship. The expanded list of permissible enterprises is still too limited. Worst of all, the relaxed rules apply only to a single neighborhood.
But expansion of private enterprise and property rights is always good news, even if it occurs in baby steps. And when the new arts district succeeds, it will provide an important lesson to local planners throughout Arizona: the best way to create growth and opportunity is freedom.
Clint Bolick is the director of the Goldwater Institute's Scharf-Norton Center for Constitutional Litigation.
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