Stonington - The Plan of Conservation and Development Subcommittee has removed a controversial proposal to consider establishing "village districts" from its just-completed update of the plan after the Economic Development Commission and business leaders expressed opposition.

Under the plan, village districts committees or a consultant would have made recommendations to the Planning and Zoning Commission about the design and many other aspects of new and substantially renovated homes and businesses in downtown Pawcatuck and Mystic.

Under state law, village districts can make recommendations about design, color, materials, landscaping and lighting and are designed to "protect the distinctive character, landscape and historic structures within such districts."

A district also would have the authority to make recommendations about the design, construction and location of roads, maintenance of public views and "other elements that the commission deems appropriate to maintain and protect the character of the village district."

"Village district zoning would be a huge unnecessary policy shift and a colossal impediment to economic activity," wrote Economic Development Commission Chairman Blunt White in a document criticizing various aspects of the draft.

At its meeting on Monday, the subcommittee reviewed several parts of the plan that have been criticized by the Economic Development Commission and agreed to remove the suggestion for village districts.

Instead, the subcommittee will now recommend that the existing Architectural Review Board, which makes recommendations concerning the exterior appearance of only commercial development, be used to guide development in the villages.

Unlike the establishment of a historic district, which property owners in the affected area must approve by a two-thirds vote, a village district could have been implemented by the Planning and Zoning Commission with no vote by residents.

White had said the establishment of a village district would create more regulations and permitting costs for businesses at time when the town wants to attract business and grow its tax base. He said it would particularly impact small businesses.

Lisa Konicki, the executive director of the Greater Westerly-Pawcatuck Area Chamber of Commerce, has said her members are "opposed to anything that puts an additional impediment on doing business in our community."

"A village district designation would stifle Pawcatuck's potential. Many of the buildings along the waterfront are ideally located but have remained undeveloped or neglected for years. It will become even more difficult to attract investors to take on projects once a village district is enacted. If we are to strengthen our grand list, we must take strides to remain business friendly in the POCD and work to be less restrictive," she wrote in an email Tuesday.

The Board of Selectmen is slated to hold a public hearing on Wednesday at 5:30 p.m. at the high school to listen to public comments on the proposed POCD. It can then make recommendations on potential changes to the Planning and Zoning Commission, which will eventually adopt the plan.

j.wojtas@theday.com

Twitter: @joewojtas