Wal-Mart: The D.C. Council has forced our hand
By Alex Barron,
Alex Barron is a regional general manager for Wal-Mart U.S. and is responsible for about 90 stores and 30,000 associates in the D.C. area, including all stores planned for Washington.
For almost three years, Wal-Mart has worked on a plan to bring new stores to Washington, and we are close to opening our first location in the city. Unfortunately, the District may soon adopt legislation that discriminates against business and threatens to undo all that we have accomplished together.
In November 2010, Wal-Mart announced a plan to bring more jobs, shopping options and fresh food choices to Washington residents. Just 12 months later, we increased our investment — from four stores to six and from 1,200 jobs to 1,800 — in an effort to expand access and opportunity to more underserved communities in the city.
During this time, we also engaged in an open dialogue with residents, stakeholders, critics and elected officials. Our goal was to listen, share information about our company, answer questions about our plans and address any concerns.
Residents told us that they wanted good jobs and more affordable grocery options in their neighborhood. We also heard about issues such as local hiring, competitive wages, an inclusive construction process, local products and support for community nonprofits.
Through these conversations, it became clear that most residents thought Wal-Mart could be part of the solution in Washington, a sentiment supported by our polling, which showed that 73 percent of residents were “in favor” of Wal-Mart.
We thought it was important to document what we heard — a Community Partnership Initiative — and share it with the city. At the time, Mayor Vincent C. Gray (D) said that “this agreement represents an unprecedented, citywide commitment from a retailer. . . . Wal-Mart is showing what it means to be a good corporate neighbor, and I encourage other firms interested in doing business in the District of Columbia to show a similar level of commitment to our residents.”
The document was particularly unique because it was voluntary — Wal-Mart was not accepting any tax incentives, even though some of our projects qualified for government assistance. Still, our agreement spelled out our plans to stock local products, allow space for local retailers, provide good jobs, ensure an inclusive construction process, fund transportation measures, create a citywide job-training program and support nonprofits to help fulfill unmet needs throughout the city.
Today, three of our six planned stores are under construction, with the first two expected to open this fall.
But despite the consensus among D.C. stakeholders about the economic value that our stores would bring, some members of the D.C. Council are advancing an eleventh-hour effort to try to undermine our efforts and change the way businesses like Wal-Mart must operate in the city. New legislation — the Large Retailer Accountability Act (LRAA) — would require that a few large employers pay a starting rate that is more than $5 per hour above the minimum wage.
From day one, we have said that this legislation is arbitrary and discriminatory and that it discourages investment in Washington. We have gone to great lengths to have thoughtful conversations with council members about why the LRAA would result in fewer jobs, higher prices and fewer total retail options. Most shopping dollars would stay in the suburbs, unemployment would remain in the double digits in some neighborhoods, and underserved communities would continue to have disproportionate access to affordable groceries.
For months, we have chosen to use hard facts, statistical evidence and common sense — instead of idle threats — to educate the D.C. Council about the negative consequences of the LRAA.
Our stance has been echoed by The Post’s editorial board, residents, small business owners and groups such as the Retail Industry Leaders Association, the National Retail Federation, the D.C. Building Industry Association, the International Council of Shopping Centers, the D.C. Chamber of Commerce, the Greater Washington Board of Trade and the Restaurant Association Metropolitan Washington.
Unfortunately, this diverse chorus of opposition to the LRAA has fallen on deaf ears among council members, and the final reading of the proposal is scheduled for Wednesday.
Like any business, we have a responsibility to our customers, employees and shareholders to reevaluate our options when it looks as if local rules may significantly change. The LRAA would clearly inject unforeseen costs into the equation that would create an uneven playing field and challenge the fiscal health of our planned D.C. stores.
As a result, Wal-Mart will not pursue stores at Skyland, Capitol Gateway or New York Avenue if the LRAA is passed. What’s more, passage would also jeopardize the three stores already under construction, as we would thoroughly review the financial and legal implications of the bill on those projects.
This was a difficult decision and one we arrived at after considerable contemplation.
There is no question that Wal-Mart has surpassed the community-relations efforts of other retailers seeking to come to Washington. In response, some members of the council are fast-tracking a game-changing piece of legislation that challenges our ability to deliver.
While we will continue to engage with the council leading up to Wednesday’s vote, we urge Mayor Gray to veto this discriminatory legislation, as it runs counter to every economic development platform that his administration has identified as a priority for Washington.
Read more: Editorial: Proposed D.C. wage law is a business-buster Henry Jordan: The District’s terrible message to job creators Harold Meyerson: Taking “service” out of the service sector