Mandating Negotiations to Solve the <em>NIMBY</em> Problem: A Creative Regulatory Response

Abstract

The (not in my backyard) syndrome has long frustrated the efforts of policy makers, land use planners, and developers to site locally undesirable but socially beneficial facilities. This paper discusses and evaluates an innovative generation of regulations that employ negotiation strategies to resolve problems. conflicts arise from projects that typically generate widely dispersed benefits while imposing concentrated costs, such as homeless shelters, prisons, airports, sports stadiums, and waste disposal sites. (1) Despite the social desirability of such projects, they often provoke intense local resistance that harnesses the political process to block construction of the proposed facility. Since the mid-1970s, opposition has been particularly fierce in confronting efforts to site waste disposal facilities. (2) Organized and persistent public opposition has scored consistent victories over attempts to construct facilities that are essential to an industrialized society. Noteworthy illustrations include enduring opposition to develop new landfills to meet the demands of expanding urbanization, an alarming inability to build electric power plants that is partially responsible for recent electricity crises in western states, and the Department of Energy's persistent difficulties in locating a permanent site for high-level radioactive waste. (3) For solid and hazardous waste facilities, the siting problem has become so acute that one policy maker has suggested that the NIMBY syndrome is perhaps better characterized as BANANA--build absolutely nothing anywhere near anything. (4) The persistence of disputes represents a failure of the political process. fights are too bitter and divisive for public institutions to deliberate and devise careful legislative and regulatory solutions. Political leaders thus tend to defend the targeted neighborhoods instead of implementing responsible land use policy. To counter this impasse, some states have enacted innovative regulations to help site waste facilities using procedures that bypass the standard political fight. Moving away from traditional siting strategies that relied chiefly on aggressive and combative tactics, (5) these regulations use negotiation strategies to resolve NIBMY problems. Site developers and local community leaders are required to bargain directly with each other. They enter into a structured negotiation process designed to induce agreements that will site regionally needed facilities while addressing local concerns. This paper seeks to understand disputes as a contracting problem where developers and communities struggle to reach an agreement to site a waste facility. It explores the underlying challenges that have motivated policy makers to institute mandated negotiations and examines the early results of their implementation. This approach begins with a simple model and then introduces complexities: the first section characterizes the contracting problem as a simple transaction, and the second identifies the specific contracting difficulties that explain why disputes emerge instead of easy agreements. Regulations that mandate negotiations, discussed in the third section, can then be understood as responses to these particular contracting difficulties, and the final section reviews two case studies to evaluate the preliminary impact of these regulations. The central objective of this paper is to understand how problems emerge and understand the logic that motivates this new generation of siting regulations. Understanding the problem, however, does not necessarily translate into a simple regulatory solution. While this analysis speaks to the efficacy of relying on negotiations as a vehicle to resolve disputes, it also addresses the effectiveness and limitations of employing regulatory solutions. AS A CONTRACTING PROBLEM Underlying a dispute over siting a waste facility is a contracting problem between a developer and a host community. …