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“Big Box” Law Passes Assembly

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The California Assembly has passed a law that would make it harder for big retailers like Wal-Mart to build large retail outlets. The new law requires developers to consider the big stores´ affects on taxpayers before they can be built.

Senator Alarcón´s SB 1056 has passed the California State Assembly today by a vote of 42-31. The legislation will go before the full Senate possibly as early as Thursday. Senator Alarcón says, “This is a victory for taxpayers, small business and for workers with good paying jobs. When not properly planned, ´Superstores ´ can kill jobs that pay decent wages at grocery stores, hardware stores and auto shops. I´m hopeful that we´ll soon have full Senate passage and be able to convince the Governor that this legislation not only saves jobs, it saves good jobs.”

Wal-Mart typically pays its employees considerably less than the union jobs it replaces. A U.C. Berkeley study finds Wal-Mart employment policies cost California taxpayers $86 million a year. This is the amount taxpayers spend subsidizing the corporate giant by paying for its employees´ food stamps, welfare or Medi-Cal. Critics argue that Wal-Mart essentially shifts part of its labor costs onto the public.

SB1056 does not ban Wal-Marts or other Big Box retailers. Instead, the proposed bill requires retailers to pay for an independent economic impact report to be conducted prior to the approval of a superstore. SB 1056 defines a Superstore as a store larger than 130,000 square feet, which devotes more than 10% of its sales to groceries and carries over 20,000 stock keeping units.

Often, municipalities who need to balance the entry of the potential sales tax generators with the effects on small businesses and worker´s wages don´t have the needed funds to conduct such reports.

Without a uniform state law, local officials who choose to require such a report could put their city or county at a disadvantage. Without this law, if one municipality were to charge an applicant for approval cost, a superstore business could simply seek to operate at an adjacent city without such a requirement. Without a state-wide law, local sales tax revenue could be shifted away from the cities requiring the report.

Press Release