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Over 600 religious leaders throughout Los Angeles County have formed Clergy and Laity United for Economic Justice (CLUE) to support low wage workers in their fight for dignity and respect. More

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City Council Sends Notice to Big Box Stores
Copley News Service - August 10, 2004
By Alison Shackelford and David Zahniser

A proposal that would create hurdles for building Wal-Mart superstores and other "big-box" retail stores in Los Angeles was approved Tuesday by the City Council, paving the way for a vote Wednesday that is expected to turn the guidelines into law.

The proposed ordinance would restrict construction of the stores in and around areas earmarked for redevelopment, creating "protected" regions that would encompass approximately 60 percent of the city. To obtain a permit to build in these areas, all stores over 100,000 square feet that include full grocery departments would have to hire a consultant to examine not only issues such as potential traffic increases but also the store's economic effect on the surrounding community.

The law would affect Wal-Mart, K-Mart and Target superstores, but not regular Wal-Marts and membership clubs such as Costco and Sam's Club.

Protected regions include the vast majority of the Harbor Area, along with southern and downtown Los Angeles. Westchester, Playa del Rey, Venice, Eagle Rock, portions of West Los Angeles and large swaths of the San Fernando Valley - neighborhoods that haven't been designated to receive government economic assistance - are among the areas where a superstore could be built without a consultant's additional report.

A Wal-Mart currently under construction at 190th Street and Normandie Avenue in Harbor-Gateway falls within a protected area, but would only be subject to the new ordinance if it expanded to become a superstore. Currently, there are no superstores within the Los Angeles city limits.

Mayor James Hahn joined council members Eric Garcetti and Ed Reyes on Tuesday morning to voice his support for the proposed law.

"Sometimes superstores pay lower wages than existing companies, and lower benefits, which creates added burdens on the taxpayers who have to pick up food stamps or health-care costs for workers," Hahn said. "We don't want to ban any stores ... (but) if a superstore is coming into a neighborhood, they're going to have to answer a series of questions indicating whether or not, net, is it going to be a benefit to the community?"

Among other things, the required economic analysis would examine the number of jobs to be created and the level of wages a new store would pay, and compare it to existing jobs and wages likely to be pushed out due to competition. Because superstores sell groceries, Garcetti argued, shoppers are more likely to use them as their sole daily shopping center, draining customers from local strip malls with nail salons, movie-rental stores and pizza shops.

If city officials determined that the negative impacts outweighed the benefits, the chain's application for a building permit would be denied.

Even so, Wal-Mart spokesman Peter Kanelos, who did not attend the meeting, gave the proposed ordinance his guarded support.

"We do not support any attempt to limit competition," Kanelos said, but added, "We view the union's failure to persuade the city to ban Wal-Mart (outright) as a victory for consumers."

The council spent over an hour discussing the proposal, which was strongly supported by labor representatives attending the meeting. The council voted 13-1 in favor of the proposal, with Councilman Bernard Parks opposed and Councilman Greig Smith, who owns stock in Wal-Mart, recusing himself.

Parks argued that his district received a huge financial boost when a Wal-Mart opened in the Baldwin Hills Crenshaw Shopping Plaza. The low-cost chain store opened in a struggling section of the mall that had been vacant for five years, when no other retailer was willing to occupy it, Parks said.

"Five hundred people have jobs there," he said. "Not one of them has a ball and chain on their leg, and they show up for work every day."

Los Angeles joins other local cities in seeking to restrain supercenter construction. Inglewood voters recently rejected a ballot measure that would have allowed Wal-Mart to build a superstore without following the city's permitting process.

But Parks warned that the proposed law would prompt Wal-Mart to open superstores in communities immediately outside Los Angeles, depriving the region 's largest city of tens of millions of dollars in annual sales tax. Wal-mart has already submitted a proposal to open a supercenter in Rosemead, in the San Gabriel Valley.

 

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