HARTFORD HOUSING AUTHORITY
A STRANGE SILENCE GREETS THE MEGASTORE
The Hartford Advocate Reprint
By Dan Levine,
May 16, 2002
Motorists coming off I-84 West at Flatbush Avenue are used to gazing at a grassy meadow at the end of the exit.
The scenery is about to change.
Soon Wal-Mart will be the vanguard in the largest economic-development project to hit Hartford's Behind the Rocks neighborhood in years. A 166,250 square foot Wal-Mart discount store is slated to break ground in July, and when completed, the mega-retailer will be the anchor tenant in a massive retail development on Flatbush Avenue, with at least three other large businesses and two local storefronts -- like a Chinese restaurant.
That no one is complaining speaks to how bleak a retail environment Hartford has become in the last 20 years or so.
Protest can be fierce when Wal-Mart enters a new town. Newspapers feature front-page stories with frightened residents claiming they'll do anything to stop the world's largest retailer from moving into their neighborhood, driving their small, local pharmacies and shoe stores out of businesses in exchange for jobs that pay poverty wages.
"Welcoming Wal-Mart is like drinking anti-freeze," says Al Norman, the guru of a national anti-Wal-Mart movement. "It tastes sweet but it kills you."
Many big-box retailers face that kind of opposition. In January, for instance, the town of Canton's zoning commission voted 6-1 to deny a zone change that would have paved the way for a Target. Similar opposition to sprawl has taken place -- successfully -- in other Connecticut towns like Orange, Old Saybrook, Plainville and Tolland.
While Wal-Mart spokesman Keith Morris points out that dozens of stores spring up without protest, he acknowledges that New Englanders are typically more reticent to receive Wal-Mart than other areas. Two years ago, Wal-Mart faced vocal opposition in Colchester that eventually stopped the retailer from coming to town.
But since news of the Wal-Mart's arrival in Hartford broke in March, no vocal opposition to the development has surfaced, a minor miracle in a town where the jingle of an ice cream truck sparks judicial intervention. So far, Wal-Mart has ridden into town without reaching for its Kevlar vest.
Why the serenity?
Hartford is a special case, development officials say, because there aren't many small retailers for the large store to compete with. City officials say we must face reality and dive in to the big-box retail economy, which matches the low "skill sets" of our residents. Better-paying, light industrial jobs are nice, but at this point are out of reach for Hartford, they argue. A low-paying Wal-Mart job can still be a first step in getting folks into the work force. And since suburbs like West Hartford and Manchester have already smothered downtown retail, they say, there is nothing left for Wal-Mart to kill.
It's as if Hartford politicians, neighborhood leaders and development honchos have heard the anti-Wal-Mart arguments, shrugged their shoulders, and answered with a collective, "Bring it on."
With her union background and confidence to confront authority, Jackie Maldonado would be well-suited to oppose a Wal-Mart development. An activist with Hartford Areas Rally Together for 10 years, Maldonado is concerned about the quality of Wal-Mart jobs, and says she is upset that Hartford's political leadership didn't hold public discussions about the Wal-Mart development before the deal was signed.
But that's the extent of her criticism. "For retail, it's going to be a service to families who need the low prices," she says.
"I'm very happy to have Wal-Mart coming to the neighborhood," echoes Jackie Fongemie, chairwoman of HART's Behind the Rocks problem-solving committee. "One, a lot of residents don't have cars. Two, it will bring jobs to the neighborhood."
And Maldonado adds she is delighted she will no longer have to drive to East Windsor or Cromwell to visit Wal-Mart because, as she puts it, "I'm a Wal-Mart queen."
With net sales of $217.8 billion annually, Wal-Mart officially became the world's largest company this year. It began as an Arkansas discount store, became a regional powerhouse, and now employs more than a million workers at 1,647 discount stores and over 1,000 super centers.
Wal-Mart will open 180 new stores this year, according to Morris. The location on Flatbush Avenue will be Connecticut's 24th.
The mega-retailer's foray here reflects a transition in the company's placement strategy. Wal-Mart has gradually shifted its focus from rural and suburban fixture to urban invader. American cities are the last frontier for Wal-Mart, a company with a profit strategy based on aggressive expansion. New Wal-Marts are up and running in Baltimore, Dallas and Cleveland. "It makes sense from a demographics point of view," says Ira Kalish, a retail analyst with Retail Forward, a consulting firm based in Los Angeles.
Wal-Mart did its homework in Hartford. Before agreeing to come here, the company spoke to some members in the community to gauge just how they would be received, says Harry Freeman, executive director of Hartford's Economic Development Commission. Freeman declined to name who Wal-Mart spoke with.
Freeman says Wal-Mart had to be coaxed into Hartford, and though the company had to be convinced it would make money, the city's mood was a key selling point. "The presentation that I had made to them was that yes, they would be welcomed really with open arms because it is a need that has been identified by the residents," Freeman says. "That was a compelling argument to them."
The company never had anything against urban markets, Wal-Mart spokesman Morris says, but was slow to make the transition because of high real-estate costs. He says the process has been ongoing, but is more noticeable now.
"You're starting to see more of an urban focus on the part of Wal-Mart," says Norman, the Wal-Mart critic. "I think in part it's because they're running out of terrain."
But a retailer like Wal-Mart wasn't always part of the plan for Flatbush Ave. Until 1996, that land was part of the former Charter Oak Terrace housing project. After 1,000 barracks-style housing units were demolished, an outgrowth of Hartford Housing Authority executive director John Wardlaw's "reinvention" of public housing, the land east of the Park River was set aside for 130 suburban-style homes, which were constructed between 1996 and 1998.
A central component of Wardlaw's "reinvention" strategy is breaking the cycle of poverty for public housing residents. So the Housing Authority set aside land west of the Park River for economic development.
In 1999, the Authority issued a call to developers to come up with proposals for a "Light Industrial Park Development." The term "light industrial" generally means manufacturing with little impact on the surrounding environment, or businesses that need high bay storage space. Light industrial jobs generally pay better than Wal-Mart jobs.
Six companies responded to the request, according to Paul Capra, planning and development chief at the Housing Authority. Only one respondent had retail development in mind -- CBL Associates, a Tennessee-based mall developer that will bring in the Wal-Mart.
According to Capra, the other five developers didn't have a "slam-dunk" concept for light industrial, and all wanted subsidies from the city, like tax abatements. CBL didn't, although Wal-Mart will seek a tax-fixing agreement.
"But what really won the day for us in reviewing the developers was the speed which the development could be done," Capra says, referring to CBL's retail proposal. "It was the highest and best use for the number of jobs created... . Retail jobs are the best match for the talent set we have in Hartford." Translation: Wal-Mart jobs fit with Hartford's unskilled labor market.
Politicos share a common refrain when they're asked about the quality of Wal-Mart jobs: Yes, they're not the greatest, but they teach people the basics of holding a job and keeping one.
"For some people, it will be an introduction to a paycheck. For some people, it will be an introduction to colleagues. That's a new experience for some people," city economic development board chairman David Kovacs says. "Do I wish [they] were higher-paying jobs? You bet your butt I do. But frankly a lot of those jobs wouldn't be available to Hartford residents."
The Wal-Mart development will take up much of the Charter Oak Terrace site, but space is still set aside for light industrial growth, Capra says. And an $18 million federally funded Jobs Corps training center will also take up part of the site, situated in back of the other retail tenants.
But some argue that the mantra of Wal-Mart bringing good new jobs to its host communities is a red herring.
"I think it's based on the premise that right now, there are lots of people anxious to work, even at $7 an hour, but can't find jobs," says Thomas Muller, an economist and author of What Happened When Sprawl Mart Came to Town. Maldonado fears the center could become a funnel directing Hartford residents into dead-end jobs.
"Those jobs aren't going to be attractive to everyone, but they will be attractive to some people," says Tom Phillips, president of the Capital Region Workforce Development Board, an umbrella group that deals with employment issues in the Hartford area.
HART's Fongemie and Maldonado are planning neighborhood meetings on the Wal-Mart development over the next few months, where Fongemie hopes residents could persuade Wal-Mart to pay higher wages.
That sounds like wishful thinking. The company studies the prevailing wage in each town it moves into, and then sets its wages at a competitive level, Wal-Mart spokesman Morris says. Morris says he cannot predict the wage rate for the Hartford location, but the average Wal-Mart worker in the Northeast makes $9 an hour and works 30 hours a week, taking home $270 a week before taxes.
Not all service industry jobs pay so poorly, however. Take Stop & Shop, located on New Park Avenue a few blocks north of the proposed Wal-Mart development. A full-time checkout clerk makes over $13 an hour to start, according to Brian Petronella, spokesman for United Food and Commercial Workers local 919, based in Westport, which represents the deli and meat department workers.
Stop & Shop also pays the entire tab for each worker's health and dental benefits, along with contributing to a defined pension plan, unlike Wal-Mart's benefits package.
The most basic health plan for a single Wal-Mart worker takes $11 from the paycheck every two weeks, Morris says, with the company paying the rest -- not too much of a pay hit for that average associate making $270 a week.
For a single mother raising two kids, though, the income percentage is more drastic. Morris failed to provide figures, but that mother can pay $72 every two weeks for insurance, according to the United Food and Commercial Workers' union- over 10 percent of her income. For a single mother coming off welfare, then, a Wal-Mart job probably wouldn't pay the bills, Phillips says. But for a kid out of high school, it wouldn't be so bad, he says.
If Wal-Mart workers in Hartford wanted to unionize to bring their pay up to the level of Stop & Shop, they probably wouldn't have much luck. Wal-Mart has successfully fought organizing efforts across the country. As of now, no Wal-Mart store is fully unionized.
Asked if Hartford's Economic Development Commission tried to winnow any promises of neutrality from Wal-Mart if workers tried to unionize, Executive Director Freeman says he'll leave those matters up to the National Labor Relations Board, adding that it's not the government's place to interfere in the marketplace.
But Wal-Mart officials, as well as Freeman, point to the UFCW organizing failures as proof that Wal-Mart workers are content.
"There's people who have expressed a lot of concern about Wal-Mart not being unionized but ... we should look at it from the other side," Freeman says. "Why does that occur? Just because someone is or is not unionized doesn't speak to how they treat their employees and continue to treat their employees."
Naturally, the union sees it differently. "Every time our union approaches Wal-Mart employees, [the company flies] out an anti-union squad to squash any activity," the union's Petronella says.
Wal-Mart is currently defending itself against anti-labor charges in front of the National Labor Relations Board in several locations across the country. In Texas, Petronella says the company closed every butcher department in the state after workers in one department successfully unionized. Morris failed to respond to questions regarding his company's labor record.
Petronella says his union will oppose the Hartford location, and will organize contrary voices "soon." The union could be a lonely fighter.
Jobs aside, zoning is usually the most contentious issue Wal-Mart faces in communities it enters. In Hartford, though, the land set aside for Wal-Mart is surrounded by other big-box stores -- Home Depot is a few blocks away on New Park Avenue, which also boasts a Raymour & Flanigan furniture store.
That makes moving in much easier for Wal-Mart, unlike some of its other urban experiences. In New Orleans, Wal-Mart just won a bitter battle to place a store in that city's historic lower garden district. According to company spokesman Morris, the Hartford store will be sufficiently far away from residential neighbors.
Wal-Mart doesn't even need a zoning change to start work on Flatbush Avenue, says Freeman, just a nod from the State Traffic Commission, and city council approval for the tax-fixing agreement, and the project is a go.
When Stop & Shop built its store on the old Royal Typewriter factory site on New Park Avenue in 1994, residents cheered the construction as much-needed economic development. Ironically, the new Wal-Mart could wind up competing with the grocer in the future. Wal-Mart says its Hartford store will not include a supermarket at first. But the developer's site plan leaves expansion room, and the only possible addition would be a grocery, which could bring down area wages.
As for Wal-Mart's effect on retailers besides Stop & Shop, Freeman points to the willingness of other stores to move in right beside Wal-Mart in other towns as proof that the giant does not stifle competition. Names of some of the other retailers will be announced in the coming month.
And frankly, Kovacs and other development officials say that Hartford doesn't fit the mold where a vital retail industry is threatened. Hartford needs a paradigm shift -- the suburbs have already sucked the retail life out of downtown, so Hartford needs to reverse the trend, they say.
"The smaller stores made the decision to leave the city because downtown could not compete with the malls," Kovacs says. "It's a different retail environment now."
That may not be much consolation to Hartford's remaining garages that offer tires or lube jobs, vision centers, camera shops, record and stationery stores, because Wal-Mart offers all of these services. "I wouldn't accept the argument no one is left so no one can get hurt," the author Muller says. "That's a bit of a lame argument."
For now, though, these isolated critical voices are subsumed by Hartford's Wal-Mart fever.
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