Local zoning decisions provide the most efficient method of resolving property disputes and implementing voter-approved Master Plans.
Our New Hampshire state statutes explicitly affirm that “Planning, zoning and related regulations have been and should continue to be the responsibility of municipal government.” (RSA 672:1)
Town land-use ordinances have recently come under attack, however, and are blamed as the source of New Hampshire’s continued housing crisis.
To correct what has been inaccurately termed “regulatory overreach” from municipal planning and zoning boards, bills were enacted in 2025 and 2026 to replace local decisions with state-level mandates.
These state bills are undoubtedly well-intended. But in their efforts to solve the housing crisis with “deregulation,” lawmakers have ignored important lessons about the efficient regulation of externalities, as explained in every economics text.
No one objects to individuals owning property for personal use.
But “spillover effects” from private activities do occur.
These externalities can be significant: air, water, noise, and light pollution; noxious by-products and run-off from industrial or agricultural activity; encroachment on town forests, designated wildlife corridors and aquifers; increased traffic and concomitant safety risks; adult-oriented shops near schools; overshadowing of property; commercial growth impinging existing or prospective historic districts; crowing roosters; barking dogs; and increased taxpayer costs for roads, infrastructure and law enforcement.
Should property rights disputes arising between owners be resolved locally – or through state mandates?
Solutions to private arguments would ideally emerge through Coasian negotiation. Disputants would efficiently bargain together to settle an externality. But after the 100th call to police for “noise levels” at parties, the high transaction costs of settling recurring arguments may make local ordinances a “second-best” solution.
People differ – and so do resources, economies, and topographies.
Regulatory solutions are best constrained by the preferences of property owners at the local level. For some towns, livestock operations “smell like money!” For others, a pleasant, odor-free community is prized – and the externality is regulated with legal rights (ordinances) favoring that outcome. Parking space regulations will optimally vary by town. Towns with roads lacking shoulders will create parking ordinances to facilitate snow plowing operations during winter, etc.
Libertarian economist Murray Rothbard, despite his bluster about ‘strict liability,’ did recognize the subjectivity of externality disputes. He wrote, “No one would maintain that [a] man has the right to live as if in a ‘sound-proofed’ room; only excessive noise, however vague the concept, can be actionable.” (emphasis added pp. 152-153) In short, one’s Constitutional Rights are guaranteed – just not above 90 decibels. Note his admission – that private activity is not unlimited in the presence of other people and that liability involves subjective value judgments rather than hard metrics.
The free market system routinely “encroaches” on individual rights. A private-sector apartment owner may resolve disputes by limiting pool-use hours, enacting no-pets rules, and so forth in rental agreements. That’s what local towns do.
Some lawmakers have publicly disparaged local ordinances regulating commerce, open space, and historic districts in New Hampshire towns – calling them a “patchwork” of arbitrary “obstacles” to housing affordability.
The reality is that municipal ordinances are carefully developed based on a master plan approved by voters. Town rules are regularly revisited and reviewed during frequent evening hearings held by planning board and zoning board of adjustment members. These elected unpaid volunteers listen to multiple sides of legal disputes at town hall meetings. Variances and waivers are approved to reflect local preferences for development and optimally resolve disagreements over legal rights and property lines.
Lawmakers who claim statewide zoning mandates “safeguard landowners against local government overreach” forget Ronald Coase’s main insight: externality disputes involve neutral parties who disagree on ambiguously defined legal rights – not “good guy versus bad guy” situations.
While enabling legislation such as HB 1010 (2026) is welcomed and I will support it, several bills have done significant harm to efficient local control.
HB 631, for example, became law in 2025. It mandates that all New Hampshire towns allow multi-family residential developments within commercial zones.
A second bill, HB 1588, just signed by Governor Ayotte, authorizes these mixed-use zones, “as a matter of right.”
These two statutes effectively destroy the essential purpose of town master plans.
Commercial zones are established to manage business growth to limit potential spillovers to residential areas and other uses. Private firms interested in locating in a town will likely do so gradually, not instantly or within 12 months of a master plan’s approval by voters.
When state-level mandates force towns to place housing in areas reserved for long-term commercial expansion, it deprives them of space explicitly established for that purpose. Designated zones embody the framework of a local master plan. Otherwise, what is the point of having one?
Even attorney Charles Gardner, a housing expert at George Mason who frequently testifies against local zoning ordinances, admits that a “common problem might be how to set aside land for industrial growth…Planners will have to work through consent-based models, identifying landowners who see value in shifting to industrial use and appropriate buffer zones.”
‘Consent-based models’? Those are called master plans. Notice how attorney Gardner circles back to a local solution.
Local control is not a perfect system, but it is the best method we have for ensuring transparency, accountability and participation in land-use decisions. Decentralized zoning also comports with Tiebout’s well-known model of government competition for efficient provision of public services.
Pam Brown is an NH House rep from Rockingham #14
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