Prospect of more Wal-Marts sparks debate in Montgomery County

October 29, 2011

Montgomery County, long cool to the lure of Wal-Mart, might be falling for the mega-retailer — and not everyone approves.

Plans to bring the retailer to Rockville Pike and Aspen Hill and to expandits store in Germantown have resurrected debate over the chain’s place in a county that has long seen itself as a beacon of progressive politics and a friend of organized labor.

But Montgomery has changed dramatically in the decade since Wal-Mart last sought to build in the county and ended up with just the store in Germantown, not the four it wanted.

The prosperity that for years insulated Montgomery from hard choices has given way to a tougher economic, and political, reality, reflected in this summer’s fractious contract talks with government employee unions and this month’s remarkable retreat on an antiwar resolution.

Now comes Wal-Mart, the nation’s largest private employer, with a promise of new jobs and low prices to a community that may not be able to be as choosy as it once was.

County officials are wrestling with how far they should go to limit the retailer and what effect those efforts could have on other developments. They are weighing a controversial bill that would require all big-box stores, including Wal-Mart, to meet with community groups and try to agree on subjects ranging from wages and benefits to traffic and environmental issues.

The legislation, which is scheduled to be discussed at a County Council hearing Tuesday, is already stirring anger among commercial interests. According to three county officials, the Westfield Group, which owns the site of a Costco planned for Wheaton, halted prep work last week, citing the bill as the cause.

Catharine C. Dickey, a national spokeswoman for Westfield, would neither confirm nor deny the action. But council member George Leventhal (D-At Large) said a regional Westfield executive, Clive Mackenzie, told him at a meeting Thursday that the site workers are now “standing around smoking cigarettes.”

A changing Montgomery

The county’s lower-income population has been growing for decades. But the country’s economic troubles have put more strain on the county’s finances just as residents’ needs are rising.

Adjusted for inflation, Montgomery saw a drop in median household income in the past decade, according to census data, a striking turnabout for a jurisdiction long ranked among the wealthiest in the nation.

There are 5,500 fewer jobs in the county compared with a decade ago, according to federal labor statistics. County officials are worried that some of the county’s 45,000 federal jobs could be lost in the continuing push to cut the federal deficit.

Many county officials question Wal-Mart’s employment policies and history of drying up unionized stores and other local businesses. This month, Wal-Mart announced that it would no longer provide health care to part-time workers, rolling back a recent expansion of benefits.

But how the council will channel its unease into legislation is unclear. The bill, introduced by the council’s president, Valerie Ervin (D-Silver Spring), may push the potential new Wal-Mart stores out of Montgomery, said local developers involved with the plans.

Modeled after legislation being considered in the District, the bill would change how Montgomery handles big-box stores.

Currently, a developer typically has its plans scrutinized by the government. In addition to fulfilling environmental and other zoning requirements, the developer sometimes must meet with community members. Depending on the size of the project, the government can compel the developer to provide public benefits, such as an environmentally friendly design or affordable housing.

The legislation would ensure that the public has a direct role in big-box developments. It would require store officials to sit down with “recognized civic associations” and sign, or make a good-faith effort to create, a legally enforceable community benefits agreement that could establish, for example, a living wage.

In a statement in response to the bill, Wal-Mart says Montgomery should not create “arbitrary and discriminatory hurdles.”

Ervin’s bill fits in with the image of a Montgomery proud of its progressivism. The retailer’s longtime foe, United Food & Commercial Workers Union Local 400, has worked with Ervin on the legislation since July, after many months of discussion.

Tom McNutt, the union president, said in a statement that with the bill, Montgomery will “improve — not damage — the local economy and quality of life.” Supporters agree, pointing to successes with the agreements nationwide.

The first major agreement was completed in 2001 in Los Angeles. There, local groups pledged support for a development near Staples Center in return for, among other things, at least 100 affordable housing units.

But critics point to the vague definition of “recognized civic associations” and to controversial agreements in New York. Neighborhood groups are sometimes left out of the discussion, as was the case at Yankees Stadium in 2006. The Yankees, city council members and the Bronx borough president agreed to a deal that, among other things, eliminated more than 20 acres of nearby parks.

Other critics say the bill is too broad, targeting all big-box stores larger than 75,000 square feet. It’s already led to the apparent delay of the Wheaton Costco project.

Nevertheless, the bill’s intent to support local businesses and retail unions led a majority of council members to back the legislation. But almost immediately, it became radioactive, with blowback from big business and several chambers of commerce, which said mandating additional negotiations would discourage economic growth.

Council member Craig Rice (D-Upcounty), a co-sponsor whose district includes the Germantown Wal-Mart, says he now regrets supporting the bill. Wal-Mart already is a good community partner, Rice said.

“The reality is sometimes we sign on to something saying, ‘Hey, this message makes sense,’ and realize it might not be necessary,” he said.

A juggling act

The recent dust-up over the council’s peace resolution was a striking example of the quandary facing legislators as they try to juggle the interests of liberal interest groups, businesses and ordinary residents.

Working with the Peace Action Montgomery group, Ervin introduced a nonbinding peace resolution. A majority of the council initially supported it, but state lawmakers and the Bethesda-based defense contracting giant Lockheed Martin urged the council to abandon the measure. After Rice and Leventhal privately expressed regrets supporting the bill, Ervin withdrew it.

A few weeks earlier, Ervin had come in for criticism from a different quarter, a union upset by the council president’s contact with a prospective Wal-Mart partner.

The Lee Development Group, which owns the Aspen Hill site eyed by Wal-Mart, met with Ervin about possible changes to the zoning, which does not permit retail. Ervin suspected that Wal-Mart was the retailer in mind, but she nonetheless scheduled a Sept. 28 meeting with the firm and Planning Board Chairman Francoise Carrier to discuss the possibility of a zoning change.

The UFCW Local 1994 Municipal County Government Employee Organization started an online petition, alleging that Ervin was “fighting” for the Wal-Mart.

Local 1994 President Gino Renne objected to her participation in the meeting, and in an interview last week, Renne said Ervin shouldn’t be involved with a development venture that may involve Wal-Mart.

Ervin, a former union leader, dismissed the petition and said that although she has problems with the retailer, she isn’t going to ignore a developer’s zoning request. She said that if Wal-Mart comes to Aspen Hill, her bill will address community concerns.

‘A difficult situation’

Meanwhile, other legislators who don’t want to look like Wal-Mart fans are working on amendments and counterproposals to Ervin’s bill.

The bill “puts us in a difficult situation,” said Leventhal, who opposes the legislation and Wal-Mart. “If you vote against it, it appears that you are welcoming Wal-Mart.”

The Germantown Wal-Mart — a 149,435-square-foot behemoth that is still smaller than an average supercenter — provides a slice of what may come.

Outside, the surface parking lot is packed. Inside, it’s more sneakers and sweats than shoes and slacks.

Stephanie Frazier, an unemployed single mother who moved to Germantown in August, recently was shopping there with her sister-in-law, Kim. In their cart were eggs, unassembled furniture and a box of Cap’n Crunch’s Crunch Berries.

Frazier shops at Wal-Mart because the clothes are inexpensive. “It’s good that they have this one for people who have lower incomes,” she said.

But Frazier wants the store to have more groceries. She may get her wish: Wal-Mart says it is asking the county to approve a 10 percent expansion to do just that.

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