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Tourists eat at a McDonald's on the main street in Banff National Park on Monday, February 25, 2013.

Chris Bolin/The Globe and Mail

Score one for free enterprise in the Rocky Mountain resort town of Banff, where debate has been bubbling for years about whether more chain stores and restaurants should be allowed. Banff town council voted 5-1 on Monday to kill a bylaw amendment that would have set quotas on so-called "formula" retailers in Canada's oldest national park.

"Should municipal government get in the way of who should and should not be able to open a business in this community?" Mayor Karen Sorensen said after the hour-long debate and vote on bylaw 314. "Those of us who voted against bylaw 314, we all spoke to the risk of not knowing the unintended consequences of making this decision."

While other tourist towns – including Qualicum Beach, B.C., and Lunenburg, N.S. – have taken steps to strictly regulate the types of businesses permitted either by size, character or signage, the majority of councillors in Banff worried that setting quotas would reduce the rental pool for landlords or scare away potential retailers.

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The community has previously banned big-box stores and already has rules in place about building heights and signage. It's also five years into reviewing its land-use rules, so the issue could come back at some point in some fashion. Right now, about 75 per cent of Banff businesses are considered "local or unique." But its main strip is also home to Starbucks, Lululemon, Roots and McDonald's, and some of the 8,200 residents worried it was turning into a strip mall.

Despite the concerns, community surveys have shown that 80 per cent of visitors like the business mix, and many international visitors don't even know when they're in a chain retailer, according to Ms. Sorensen.

"The bottom line: Locals and visitors shop at the formula-based businesses. Full stop. They shop there a lot," she said. Besides, she added, operating a chain or franchise isn't a guarantee of success. Since 2008, five formula restaurants opened in Banff, while four chain retailers closed.

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