Walmart says it will take back its threats to pull out of D.C. if Mayor Vincent Gray vetoes a living wage bill passed Wendesday by the D.C. Council.
The Council voted 8-5 to increase the minimum wage to $12.50 for employees of large retailers in the city.
Gray's decision over the bill could determine the fate of Walmart stores in the District. While he has not said what he will do, he sent a letter to the D.C. Council in advance of their vote, urging them to reconsider the bill.
"I've got to look at the full impact of the bill," Gray said. "Everybody has looked at it from the perspective of Walmart but it's bigger than Walmart."
DC Council Passes Living Wage Despite Walmart's Threats
Walmart confirmed after the Wednesday's vote that it will scrap building plans for three D.C. locations if Gray signs the bill into law. "Nothing has changed from our perspective. We will not pursue Skyland, Capitol Gateway and New York Avenue...This was a difficult decision for us...but Council has forced our hand," Walmart's Senior Director of Communications Steven Restivo said in an email.
"I hope Walmart keeps their word and comes to Skyland. Don't use this as an excuse," said Council member Jack Evans during the hearing. "Walmart never wanted to come to Skyland."
Three separate mayors attempted to develop long-neglected Skyland in Southeast D.C., with no success until Walmart agreed to it. Rappaport Development company had planned to pair Walmart with 400 homes and 300,000 square feet of retail and services.
DC Council Approves Higher Wages at Large Retailers
"We've fought for an anchor tenant for the last 10 years," Henry Fonvielle said. "Without your anchor tenant, you can't build a project."
Walmart also said its three stores now under construction in D.C. might be delayed. A spokesperson told News4's Mark Segraves the city "moved the goalpost" by changing the minimum wage.
The company is now considering legal action against the city.
Walmart Threatens to Leave D.C.
But Walmart never testified before the D.C. Council on the proposed living wage, said Council member Vincent Orange.
And, said D.C. Council chair Phil Mendelson, "We change the minimum wage from time to time. ... A person who argues we can't change anything because they relied on it, that's flying in the face of the practice of every jurisdiction in this country, which [that] is the regulatory changes one way or another constantly."
On WAMU Friday, the city’s top planning director warned D.C. will suffer a major economic impact if Walmart cancels the six planned stores.
D.C. Office of Planning Director Harriet Tregoning said currently city residents spend hundreds of millions of dollars in suburban big box stores.
The bill -- known as the Large Retailer Accountability Act (LRAA) -- will require large retailers to pay wages no lower than $12.50 per hour. This would also include subcontractors working on the premises of the stores.
Large retailers are classified in the bill as those that have stores of at least 75,000 square feet and whose parent companies have sales of more than $1 billion annually.
The city's current minimum wage is $8.25, a dollar higher than the national rate.
Council member Mary Cheh said during Wednesday's hearing that she wanted Walmart to know "I don't like being threatened," but said she would vote against the bill.
Council member Yvette Alexander also voted no, saying Walmart stores were supposed to be the anchors of two major developments. "It's going to put development on hold. I'm really disappointed," she said. "And they were promising 600 jobs between the two stores."
The Council assembled around noon Wednesday, with standing room only available in the Council chamber. Most people were present for the vote on the living wage bill, Segraves reported.
During the hearing, Council member David Catania proposed an amendment to make the three Walmart stores already under construction exempt from the proposed living wage.
That amendment was voted down, 10-3, and Catania ultimately voted against the bill.
Catania said he would have voted in favor of the bill if his amendment had passed, giving the bill a crucial nine votes -- which would have prevented Gray from a veto.
A statement issued Wednesday from Gray's office reads: "The Mayor has already indicated his serious concerns over the lost jobs and retail opportunities for District residents that the bill will cause. As he waits for the Council to send the legislation to him, he'll be interested to hear what District residents and employers think."
He also called Walmart's announcement "immensely discouraging."
The company's threat to pull out of the district was an unexpected move, especially for the supporters of the LRAA who were demonstrating outside the Wilson Building on Wednesday morning.
"Particularly since they came to the clergy group a year and a half ago that I am a part of, and said they were going to pay $13 an hour," said Rev. Grayland Hagler, a LRAA supporter. "So either they were lying, or I don’t know what."
Supporters of the act said the fight -- and the risk -- were worth it to for the chance of higher wages.
"I mean, we done worked and worked and worked and worked, and barely get minimum wage half the time," said clergy leader Harold Foster.
The council had voted eight to five in favor of the bill in a preliminary vote, so it had been expected to pass, although there are never any guarantees.
As for a worst-case scenario for the workers: "...[I]f our city council caves into that, then we're going to be caving all along the way, to every single economic interest," Hagler said before the vote. "It's never going to end. We might as well get rid of the city council and let corporations run it."
Walmart released a statement Tuesday that reads in part: "While we will continue to engage with the Council leading up to July 10, we also urge Mayor Gray to veto this discriminatory legislation [LRAA] as it runs counter to every economic development platform his administration has identified as a priority for Washington, D.C."
"The LRAA would clearly inject unforeseen costs into the equation that will create an uneven playing field and change the fiscal health of our planned D.C. stores," the statement continued.
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