Baltimore should be skeptical of Wal-Mart

May 13, 2010|By Brendan Coyne, Benn Ray and Genny Dill

Recent discussion about living-wage legislation introduced by Councilwoman Mary Pat Clarke and the proposed development at 25th and Howard streets has muddled the issues with comments hostile toward the legislation and dismissive of community concerns about the 25th Street Station project. Whether these comments are purposely misleading or just ill informed remains to be seen — but we do know some facts.

Retail is one of the fastest-growing sectors of the economy, and it will remain so for the foreseeable future. According to the Bureau of Labor Statistics, retail added nearly three-quarters of a million jobs between 1998 and 2008 and is projected to add another 600,000 through 2018. These are not just entry-level, seasonal or second jobs. For an increasing number of people, retail is a career, even if it is not a first choice. Enacting laws that recognize this fact, as Ms. Clarke's does, is simply responding to reality.

Chain retailers will dominate 25th Street Station, the development proposed for the soon-to-be shuttered Anderson Motors site. According to WV Urban Developments LLC, the team led by Rick Walker, Lowe's and Wal-Mart would co-anchor the project, with Wal-Mart employing 200 to 250 people and other businesses adding 500 or so permanent positions. To date, none of the other possible tenants discussed have signed on. The developer's website mentions only Lowe's and Wal-Mart.

Communities and businesses close to the development are justifiably concerned about the nature of these projected 700 to 750 positions. Big-box stores in general — and Wal-Mart in particular — are known job displacers, not necessarily job creators. A 2009 Loyola University Chicago study found that just a couple of years after a Wal-Mart opened on Chicago's west side, about 300 area retail jobs disappeared. Substantial data, testimonies and a tour of decimated small towns across the nation attest to the fact that apprehension about this development is well founded.

With more than $400 billion in net sales last year, Wal-Mart can afford to pay its employees a living wage. Instead, the company's considerable economic power depresses wages while creating a work force dependent on taxpayer-funded social programs. A 2007 University of California, Berkeley Labor Center study found that the opening of one Wal-Mart store decreased wages at nearby stores between 0.5 and 1.5 percent on average. A host of other studies have documented reliance upon safety-net programs by Wal-Mart workers.

While some living-wage opponents argue that such laws hinder businesses and economic development, empirical evidence suggests otherwise. For instance, a 2007 report by the University of New Mexico's Bureau of Business and Economic Research, found that after Santa Fe, N.M., enacted a law similar to the one proposed by Ms. Clarke, the city's economy performed "very well," with declines in unemployment and increases in city tax receipts. A wide range of large retailers operate in Santa Fe, including Wal-Mart and Lowe's.

Given the blight surrounding the Port Covington Wal-Mart, we should all be skeptical about the promises being made for the Anderson site. The eight-year-old development never attracted the promised retailers; even the Wal-Mart owned Sam's Club is shuttered. Mr. Walker stated at a recent meeting of the Charles Village Civic Association that before connecting with Wal-Mart, he was unable to interest Shoppers or Shop Rite in the space. Mr. Walker's early failure to realize the project as he envisioned it cannot be casually dismissed.

Despite statements by Judith Kunst, president of the Greater Remington Improvement Association, no community association officially supports 25th Street Station. The only community organization to take a stance is the Hampden Community Council, which on April 26 voted unanimously to oppose the legislation allowing the development to move forward. The joint task force that has been negotiating with Mr. Walker's team still has a number of concerns that have not been addressed.

The choice presented by Mr. Walker and by Councilwoman Belinda Conaway — between 25th Street Station and a vacant lot — is a false one, despite its ad nauseam repetition. This is the first proposal, and it need not be the last. The site is roughly 11.5 near-contiguous acres not far from downtown. Howard Street cuts through the space; it is a short hop from I-83 and close to several of the city's main travel routes, including Charles Street and North Avenue. This prime city land will attract attention from other developers.

In the several weeks since the formation of our organization, Bmore Local, we've heard community members offer a variety of ideas for the site, from making it into a park to replacing the Wal-Mart with an Asian grocer like H-Mart that would anchor the "Asia Town" discussed from time to time for lower Charles Village.

As proposed, 25th Street Station could lead to a financially devastating suck of local revenue to interests outside our city and state — subsidized by taxpayers. Ms. Clarke's living wage legislation is a reasonable step that addresses one glaring problem that developments like 25th Street Station will create for the communities upon which they are forced.

Brendan Coyne is the president of Bmore Local, Genny Dill is vice-president of the organization and Benn Ray is an at-large board member. They can be reached at bmoreloc@gmail.com.

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