Spot zoning refers to when a piece of property or groups of property have special zoning laws applied to them that differ from the zoning laws surrounding them. The practice of spot zoning can be very controversial and may be illegal. Some types of spot zoning actually can be necessary, such as granting waivers for existing businesses when new zoning laws come into force or when a business might be needed in a residential area. However, spot zoning also can involve corruption where an individual receives special treatment that may harm surrounding areas or impede competition. For example, a large supermarket could persuade a local government to rezone a plot in a residential only neighborhood for building a new store, and this would reduce the value of the homes near the supermarket, increase noise, and allow the supermarket a virtual monopoly in the neighborhood.
The laws on spot zoning vary greatly by state and locality. Some areas may allow spot zoning broadly while others may condone most uses of spot zoning. For example, in New York, spot zoning is not allowed to benefit one individual or set of individuals unless it benefits the comprehensive plan for the area. Also, local governments must be careful when spot zoning not to trigger equal protection scrutiny for racial discrimination, as occurs with zoning more broadly.
[Last updated in May of 2022 by the Wex Definitions Team]