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Wal-Mart Foes Claim Win in Rosemead

Voters oust two council members who backed chain, which still plans to build a store there.

March 10, 2005|Jason Felch | Times Staff Writer

Wal-Mart's efforts to build Supercenters in Los Angeles County suffered a setback this week when voters in Rosemead ousted two council members who supported the project in that community and replaced them with two critics.

Although the results were unlikely to halt construction of the store, experts said it demonstrated the aggressive efforts of labor unions and community groups to challenge Wal-Mart at every turn as the retail giant attempts to expand across California.

The election in the small bedroom community 12 miles east of downtown Los Angeles was widely seen as a key battle in Wal-Mart's efforts to expand in Southern California. Wal-Mart wants to build 40 Supercenters, which combine a regular Wal-Mart store with a discount grocery market, in the state.

Wal-Mart's Supercenters have received a largely warm welcome in outlying communities in the Inland Empire. But unions, some politicians and some neighborhood activists have vigorously fought to keep them out of Los Angeles County.

"Its been slowed to the pace of a snail because they've run into all this opposition," said Jack Kyser, chief economist for the Los Angeles County Economic Development Corp., a nonprofit that has done regional economic studies for Wal-Mart. "It's working, but Wal-Mart is fighting back. It's too rich a market to walk away from."

The Rosemead City Council voted last year to allow Wal-Mart to build a store in the city. Though two anti-Wal-Mart council members were elected Tuesday, a majority on the council is still in favor of the development.

Critics contend that the Supercenters will drive surrounding stores out of business and mean the loss of union jobs at rival supermarkets.

The Los Angeles AFL-CIO donated close to $50,000 to support the opposition candidates in the Rosemead elections, union officials said.

"This victory in Rosemead is really key for us," said Miguel Contreras, secretary-treasurer for the Los Angeles federation.

Two and a half years into the expansion effort, three Supercenters have opened in California, and three more are expected to open this year, said Peter Kanelos, a Wal-Mart spokesman.

Wal-Mart spent close to $40,000 on the Rosemead election, Kanelos said.

Last April, Inglewood voters overwhelmingly defeated a Wal-Mart-funded ballot initiative to approve a Supercenter there. Five months later, the Los Angeles City Council passed an ordinance requiring large retailers to complete an involved economic impact report before development, a move seen as an effort to stymie Wal-Mart from moving into the city.

But Kanelos said the state expansion was progressing.

"The overwhelming majority of communities have accepted our stores," he said. "There are a small handful of communities where organized labor has opposed them."

Similar opposition efforts have sprung up across the country as the Bentonville, Ark.-based company pushes from its rural and suburban focus into markets near major cities.

Some analysts said it was that shift that had fueled some of the opposition efforts.

"There's a philosophical divide reflected in Rosemead's little battle," said Edna Bonacich, a sociology professor at UC Riverside. "Wal-Mart is trying to penetrate the big cities .... They're finding a more sophisticated population, more heavily union, that favors an activist approach and limits on the free market philosophy that Wal-Mart symbolizes."

In approving the project, Rosemead officials said they didn't believe that the Supercenter would hurt surrounding businesses and said the city needed the tax revenues Wal-Mart would bring.

Turnout in the city of 55,000 was 28%, city officials said, up from 11% two years ago.

"It's the biggest in 20 years at least," said Mayor Margaret Clarke, who had voted in favor of the plan and was reelected Tuesday. Clarke said she believed that the Rosemead project would go forward and that the retailer would bring important benefits to the city.

Some experts said Wal-Mart was learning from its battles.

"When they first came into Southern California, they hadn't done their homework," Kyser said. "Now they've understood what they have to do. They've got to convince elected officials that Wal-Mart can be a good neighbor."

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