Gas Station Blight: Is A Needs Test A Solution For Your Area

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Abandoned gas stations can blight a neighborhood for years

This month marks the 100th anniversary since the first modern gas station opened in the USA.   Today there’s nearly 153,000 stations nationwide, but they’re closing at the alarming rate of 2500 per year!

A substantial number of the closures are due to the proliferation of  the combination gas station, convenience store and even service bays.  These businesses are usually part of regional or national chains which can negotiate unbranded gasoline purchases at a price far lower than independent stations, many of which must purchase branded gas.

Cheap gasoline is then used to attract customers from nearby branded stations, many of which are independently owned.  Once the independents are forced out of business the lack of competition allows prices to rise to former levels or even higher.  At least one study showed that preventing this sort of predatory pricing led to cheaper gasoline.

Now an even greater threat has emerged in the form of the hypermart.  A typical station sells a million gallons of gasoline per year.  A hypermart can sell three- to twelve-million gallons annually.  These stations are usually associated with larger supermarkets or big-box retail.  The gas is sold very close to cost to draw customers into the store where the real profits are made.  Hypermarts are even more effective at driving independent stations to bankruptcy.

Hypermarts have also generated another concern.  The emissions from dispensing such  large volumes of gasoline at one location may threaten public health.  In fact, the California Air Resources Board recommends at least a 300-foot separation between sensitive uses and hypermart gas stations because of an increased cancer risk.  In their School Siting Guidelines, the U.S. Environmental Protection Agency recommended screening potential school sites for gas stations within 1,000 feet.

So where does all this leave us with regard to public policy and gas stations.  Well, competition is certainly good, but predatory pricing is not.  And it’s certainly convenient to get gas and other goods at one location.  But if the end result is:

  • trading dozens of nearby stations for a few distant hypermarts; then
  • gas prices eventually rise to what we paid at the now closed independent stations; which now
  • blight our neighborhoods,

then maybe more careful planning is required.

National Search for Best Practices

About a year ago the Howard County (MD) Independent Business Association commissioned CEDS to research options for accommodating the need for new stations without jeopardizing established businesses.  The Association is made up of independent stations owners who were being hammered by hypermarts and mega-convenience stores.

Our first step was to review online zoning ordinances for Maryland counties and municipalities for existing practices.  Our report did show one promising approach used by Charles County.  Next we sent a request to the 33 states with statewide planning agencies.  We asked about needs test or other innovative approaches for guiding new gas stations to locations where public benefits would be at a maximum with minimum negative effects.  Our report from this survey contained some interesting concepts.  Finally, we sent a request for information to convenience store associations  in 24 states.

Proposed Howard County Needs Test

All this research led us right back to Charles County, MD and the needs test contained in their motor fuel special exception-zoning regulations.  However, the proposed Howard County needs test (ZRA 145) differs in several ways that produce more consistent and accurate results.  The data needed to run the test is readily available.  Here’s the gist of the test.

  1. It is assumed that in a County like Howard with a very large population (287,085) that the supply of gas stations countywide matches the demand for gasoline countywide;
  2. Since gas stations vary in size we used fueling positions, which is another way of saying pump handles (usually two for each fuel dispenser);

    Fueling Position

    Usually there’s one fueling position (pump handle) on each side of a gasoline dispenser.

  3. We actually counted all of the 722 fueling positions at all 69 gas stations operating in Howard County;
  4. We then divided countywide gasoline sales by fueling positions which came out to 162,133 gallons sold per year (gpy) per position;
  5. We also divided countywide gasoline sales by countywide resident plus employee population which yielded 198 gpy per person;

The preceding calculations told us how many fueling positions are needed to accommodate a given resident-employee population.  Here’s how we used these figures to assess the need for a new station.

  1. Marketing experts say a typical gas station draws customers from up to 1.5-miles away;
  2. We identify all the existing stations within 1.5 miles of the location of a proposed station, count the number of existing fueling positions at those stations, and multiply by 162,133 gpy per position to determine the existing Supply;
  3. Next we determine the resident plus employee population within 1.5-miles and multiply by 198 gpy per person to get the current Demand; and
  4. If Demand exceeds Supply then a new station would generally be needed.

Other Zoning Requirements Must Be Updated 

From our review of Maryland ordinances and the feedback from state planning officials, there’s a clear need to update setback, buffering and other zoning requirements.  The few zoning ordinances which address gas stations were written in the days when the typical enterprise consisted of four- to six-pumps, a 1500-square foot service building, and operated mostly 7 AM to 9 PM.  A modern convenience store-gas station operates 24/7, can have a 5,000-square-foot building and ten pumps.  The following safeguards plus the needs test will guide new stations to sites where benefits will be provided with minimal negative effects.

  • Given the findings of the California Air Resources Board, higher capacity stations should be located a minimum of 300-feet from residences, schools, day-care centers, hospitals, and other sensitive uses;
  • Stations should utilize modern well-shaded, LED lighting to prevent light trespass into neighboring properties;
  • Landscaping and other buffering should be designed to achieve 100% visual opacity from any nearby residential areas;
  • New stations should be designed not to add traffic to residential streets; and
  • New larger stations should also be directed to commercial areas as opposed to those dominated by residential uses or even mixed commercial-residential uses.

How CEDS Can Help

If a gas station needs test or the other zoning recommendation are right for your area, then CEDS can help you win implementation.  Also, if you’re concerned about a proposed gas station we can help you ensure it has minimal impact on you and your neighbors.  We’ve assembled a team of experts on every aspect of gas stations which will make winning the adoption of zoning changes or defeating a fatally flawed proposal far easier.  Just give us a call at 410-654-3021 or drop a line to us at Help@ceds.org   For further detail on how we can help visit the CEDS Convenience Stores & Gas Stations webpage.

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About Richard Klein

President of Community & Environmental Defense Services (ceds.org)
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