Three months after halting ARC Greater Twin Cities’ from opening in Burnsville until it could study city policy on thrift stores, the City Council has a new staff report showing the city has 17 second-hand stores — more than any neighboring community.

The question for council members now is whether they want to regulate thrift stores more closely. The issue moves next to the Economic Development Commission on April 10. If the commission proposes action, the Planning Commission would hold a public hearing April 22 and the City Council would vote on the proposal May 7.

Burnsville placed a moratorium on new thrift stores in December after learning that ARC wanted to buy the vacant store formerly occupied by Ultimate Electronics in a cluster of businesses behind the Dakota County Burnhaven Library, on County Road 42 and next door to Burnsville Center.

Council members said at the time that they had no discomfort with ARC but wanted a better handle on how the city should be dealing with thrift stores.

Common perception is that thrift stores locate in marginal retail areas and contribute to their decline, the study found.

But thrift stores are growing in popularity, and their appeal extends beyond low-income households to more affluent ones, according to the study.

Nearby Apple Valley has four thrift stores, Bloomington has nine, Eagan has four, Lakeville has two, and Savage has three, the study found.

The numbers include larger stores — those of more than 5,000 square feet, such as the Salvation Army and Arc, which sell clothes and household goods donated at drive-up drop-off points — and smaller stores, which specialize in a single product line brought in through the front door, like used sporting goods, baby gear or consignment clothes.

Finding that the smaller thrift stores look exactly like other shops, the staff report points out that it’s the donation and processing at the larger stores that can pose a problem.

“Outdoor donation collection areas for thrift stores are unsightly, create outdoor storage issues, illegal dumping and collect debris,” the report found.

Larger thrift stores with drop-offs, donation processing and warehousing of secondhand goods can extend beyond the building to outdoor storage, semi trailer parking, or use of outdoor storage containers, the report found.

“These outdoor activities can be unsightly and interfere with site design and operation of a shopping center when not regulated.”

Burnsville has business licensing requirements for pawn shops, secondhand dealers and precious metal dealers, but it does not have zoning regulations specific to thrift stores.

Should the council decide it would like to regulate thrift stores, the study recommends:

• Adding a definition of a thrift store to the city zoning ordinance and adding provisions to require indoor storage of all drop boxes and bins.

• Drive-through lanes could be forbidden in the front or side of a building and kept in the back, separate from other driving lanes, parking spaces and sidewalks, the report recommends.

• If the council is concerned about more thrift stores opening up next to Burnsville Center, the city could create a new commercial zoning district “which would either prohibit all thrift stores or only those thrift stores in excess of 5,000 square feet.”

In discussing the findings at a recent study session, Council Member Mary Sherry said the study has clarified for her that it’s not the product that determines whether a thrift store is a problem, and not whether the goods are new or used, but whether the store is large or small and has an outdoor donation site.

Mayor Elizabeth Kautz said there is no reason for thrift stores to be held to a lesser standard than other retailers.

“I do not want to see any trailers. I do not want to see garbage,” Kautz said. “I don’t think we want to see any drop off, because right now we are experiencing that, and it does not look very good.”