Home-Based Businesses - A Zoning Perspective
Do you have a home-based business, or are you thinking about starting one? If so, you're not alone. The Small Business Administration reports that more than half of all U.S. businesses are based out of the owner's home, and it is estimated that 40 million Americans work from home. The reasons are varied: a desire to be your own boss, the result of downsizing or early retirement, minimizing overhead expenses, being tired of the commute, and flexibility to better balance work with other family obligations, such as caring for children or elderly parents. But whatever the reason, this has clearly become a desirable option for a number of people. It has worked very successfully for companies like Amazon, Google, Apple, Hershey's, Mary Kay, and Ford Motor Company - all of which started out as home-based businesses - and maybe it can work for you.
Before you get started, you should look carefully at your local zoning regulations to determine whether your particular home-based business is permitted, what type of approval may be required, and whether any restrictions apply. Some examples of common restrictions applicable to home-based businesses include:
- Limits on the number of employees the home-based business may have;
- Limits on the amount of floor space within the home that can be dedicated to the home business;
- Restrictions on the amount and/or hours of traffic attributable to the home business due to customers or deliveries;
- Restrictions on signage; and
- Restrictions on outdoor visibility of the home business due to storage of equipment or materials or parking of commercial vehicles.
At a minimum, establishing a new home-based business will require a verification by the Zoning Officer that the proposed use complies with the zoning requirements for the zoning district in which the property is located. This can be done by the issuance of either a Certificate of Zoning Compliance or a Zoning Permit. Neither typically requires a meeting with the local zoning commission. Instead, one must simply fill out a short application, setting forth information regarding the location of the property and the nature of the business, and pay a small fee.
However, in some towns and under some circumstances, a more comprehensive review and approval of the new home-based business may be necessary. This is often triggered by the scope or nature of the proposed home-based business. For example, if the business is expected to occupy more than a specified portion of the home; have employees, customers/clients, or frequent deliveries to the home; or involve the outdoor storage of equipment or materials, then the additional review may be required. This more comprehensive review may involve the need to file an application with the local zoning commission for a Site Plan Review or Special Permit/Special Exception. Either of these types of applications will require a meeting with the local zoning commission and, in some instances, a formal pubic hearing. In these events, it is advisable to consult with a Zoning attorney to assist with the specific procedural and legal aspects of the application. A Business attorney can provide guidance on formation, ownership and operating documents, and financing.