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Wal-Mart Supercenter Gets Foot in the Door

Rosemead is the first L.A. County city to OK one of the retail giant's stores that sell groceries. Foes still hope to stop the project in court.

September 09, 2004|David Pierson | Times Staff Writer

Wal-Mart on Wednesday won a long-sought foothold in a region fraught with political opposition to its expansion when the city of Rosemead approved the retail giant's plans to build its first Supercenter in Los Angeles County.

The vote came after weeks of debate in the city 12 miles east of downtown Los Angeles as labor leaders, local politicians and community groups tried to persuade the City Council that such a store would depress wages and hurt the economy.

Although Wal-Mart wants to build 40 Supercenters in California over the next four years, opponents have been fighting to keep the stores out of the county. They won a victory in March when Inglewood voters rejected Wal-Mart's proposal for a store that sells discount merchandise and groceries. Last month, the city of Los Angeles adopted an ordinance designed to make it harder for Supercenters to locate there.

But Rosemead officials said they could not afford to pass up the $640,000 that Wal-Mart is projected to add to the city's annual sales tax receipts, which now stand at $3 million.

"It amounts to a victory for Wal-Mart. How sizable is yet to be seen," said Harley Shaiken, a professor at UC Berkeley who has studied the company. "This may be a back door to Los Angeles.... But the anxiety remains."

Rosemead, a middle-class bedroom community where 90% of the 53,000 residents are Asian or Latino, has struggled to attract more businesses and has been without a major grocery store since the local Ralphs closed two weeks ago. A city-sponsored study found that the Supercenter could create 325 to 500 jobs. "It will benefit the city, no doubt about it," said Gary Taylor, a Rosemead councilman for 31 years.

Taylor said he agonized over his vote, but said in the end he believes most residents want the opportunity to shop at Wal-Mart.

"By and large, the majority of people were in favor of Wal-Mart even though they knew it was a tough decision," he said.

Wal-Mart foes said they hope to halt the project in court and bring it before the voters. They threatened to launch recall campaigns against the five City Council members who voted unanimously in favor of the plan shortly before 3 a.m. after listening to dozens of speakers.

The opposition came not just from Rosemead residents but from several prominent Democratic politicians from the area, including county Supervisor Gloria Molina, state Sen. Gloria Romero (D-Los Angeles) and Assemblywoman Judy Chu (D-Monterey Park).

"We are looking at the Wal-Martization of our economy in California," said Romero, who held town hall meetings in Rosemead opposing the Supercenter. "Local governments are essentially behaving like addicts, and Wal-Mart is their crack cocaine. It's a short-term fix."

Romero and others asserted that Wal-Mart Supercenters pay employees less and provide fewer benefits than traditional grocery stores, which are their prime competitors.

Opponents said they feared that the proliferation of Supercenters would put other stores out of business and take with them the higher-paying jobs.

The specter of Wal-Mart's expansion was a key factor in last year's Southern California grocery strike.

About 70,000 grocery workers, who earn an average of $19 an hour, walked picket lines for 4 1/2 months to protest proposed reductions in health benefits that the supermarkets said they needed to hold their own against Wal-Mart.

The strike was settled in February with a two-tier system under which the stores will pay new hires less in wages and benefits than veteran workers.

California's first Supercenter opened this spring in the desert town of La Quinta, and others are expected to open in Hemet and Stockton later this year.

Many of the first communities to get Supercenters have been poorer outlying areas that see the stores as helping to boost their sagging economies and offering more shopping choices -- and jobs -- to residents.

But as the expansion pushed closer to Los Angeles, communities became more resistant.

The election in Inglewood generated national attention, and after their victory Wal-Mart foes focused their attention on Los Angeles.

The city law approved last month states that retailers wanting to build stores larger than 100,000 square feet that devote more than 10% of their sales floor to food and other nontaxable items would have to pay for an economic analysis. The report would forecast whether a proposed store would eliminate jobs, depress wages or harm neighborhood businesses in many parts of the city.

In Rosemead, officials hope to open the Wal-Mart within two years, barring any legal challenges. The firm plans to build a regular Wal-Mart store first and add a grocery section later.

"I would characterize this as a victory for consumers," Peter Kanelos, a Wal-Mart spokesman, said of the Rosemead approval.

"People, regardless of their socioeconomic status, all have one thing in common: They all want to save money."

Despite the Rosemead City Council's unanimous support of the project, officials admit the fight leaves a deeply divided city.

Many residents expressed concerns that the store off Walnut Grove Avenue would cause traffic problems.

"It's going to change the whole character of the city and the way people live and function," said Supervisor Molina, who represents the area and attended Wednesday's marathon meeting.

In some cases, the issue divided families.

Councilman Joe Vasquez said his support for Wal-Mart angered his mother and son, who both worry that the Supercenter would depress wages.

He added, "This is going to divide people for years to come."

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Times staff writer Wendy Thermos contributed to this report.

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