Mayor has final say on Wal-Mart halting construction of 3 D.C. stores

WASHINGTON – The future of at least three Wal-Mart stores depends on the veto pen of D.C. Mayor Vincent Gray.

The D.C. Council passed a bill 8-5 on Wednesday, which requires large retailers to pay workers at least $12.50 an hour.

Retail giant Wal-Mart says it will pull the plug on three planned stores if the bill becomes law.

“The Council has made its decision, and we made a decision as well, and that’s not to move forward on the stores not under construction and take a real hard look at the ones that are,” says Steven Restivo, the retailer’s director of communications.

Without Gray’s veto, Wal-Mart, which has already started construction on three stores in the District, says it will not pursue the Skyland, Capitol Gateway and New York Avenue locations.

“We have to look at the financial implications on the three stores that are currently under construction and see what our options might be from a legal standpoint regarding those three stores as well,” Restivo says.

The bill would apply to retailers with stores of 75,000 square feet or larger and at least $1 billion in annual corporate sales. No other city has approved a wage measure that targets only large retailers.

The lengthy debate among councilmembers focused on the implication for jobs and the workers who would be collecting paychecks.

Supporters and opponents of the bill packed the council chambers to hear the debate and learn the fate of the bill, with jobs and community values a concern for both sides.

“This legislation is a development killer. This legislation is a jobs killer,” said Councilwoman Yvette Alexander, D-Ward 7.

But other councilmembers argue the District’s economy is improving and that officials can afford to set ground rules for businesses operating here.

“The question is not whether Wal-Mart leaves or stays, it’s about what we do to pay our lowest paid workers a living wage,” said Councilman Vincent Orange, D-At Large.

The bill, which exempts retailers with collective bargaining agreements such as Giant and Safeway, was supported by worker advocates and labor unions who argue major chain stores should have to pay workers enough that they can cover basic necessities. Minimum wage in the District is $8.25 per hour.

A study released earlier this year found that a worker earning minimum wage would need to work more than three jobs or work 132 hours per work to pay rent in the District, the Washington Business Journal reported.

But Wal-Mart and other business groups — including the National Retail Federation — have opposed the bill, calling it arbitrary and discriminatory against select retailers.

“The Large Retailer Accountability Act is a flawed and unwarranted bill and a prime example of why the District is consistently ranked as one of the worst places to do business in the nation. It is also a prime indicator as to why unemployment remains consistently high for District residents even as it improves in surrounding jurisdictions,” the federation said in a statement. “D.C. should welcome business and jobs, not chase them away.”

Gray has said Wal-Mart’s threat to halt three planned stores would set the District back. Before the council’s vote, he asked members to consider whether the bill would promote economic development.

Gray said he hadn’t made up his mind whether he would exercise his veto power and that he would have to review the bill first.

“We worked very hard to bring retail to the District of Columbia. We don’t want to have a chilling effect on people who potentially want to relocate to the District of Columbia,” he said.

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WTOP’s Andrew Mollenbeck and The Associated Press contributed to this report. Follow @mollenbeckWTOP and @WTOP on Twitter.

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