Politics from the Palouse to Puget Sound

Saturday, January 21, 2006

Witness: Wal-Mart 'raises all boats'

From today's Lewiston Tribune:
of the Tribune

PULLMAN -- A new Wal-Mart Supercenter here would tap into an estimated $92 million in retail sales that currently leaves town and also bring more than $700,000 in sales tax revenue back to the city, an expert witness for the world's largest etailer testified Friday.

What's more, said Bill Ried, fewer than 12 percent of the city's current downtown merchants would end up competing with Wal-Mart and national chain stores like ShopKo are already surviving competition with the Moscow Wal-Mart store.

"The common term is that it raises all boats," Ried testified during a day-long hearing triggered by a citizens' group opposed to Wal-Mart's arrival here.

T.V. Reed, spokesman for the Pullman Alliance for Responsible Development (PARD), said during a break in the hearing that despite the testimony of Ried and other Wal-Mart experts, many fiscal, traffic, environmental, safety, and Wal-Mart business practice issues remain.

Ried said he based his fiscal impact conclusions in part on a two-day visit he made last October. He said he toured Pullman's three retail corridors -- downtown, on Grand Avenue and on Bishop Boulevard -- taking into account the various retail outlets.

Downtown, said Ried, he found 83 businesses that offered retail merchandise or services. Of those, he said, a total of 10 appeared they could end up in competition with Wal-Mart at varying levels.

"I was surprised," Ried said of the apparent retail vitality downtown.

According to Washington Department of Revenue reports, said Ried, about $96 million in annual retail sales is spent locally by people living in Pullman. But a town the size of Pullman, said Ried, is probably spending about $188 million.

The difference amounts to the $92 million that's being "leaked" outside the city to places like Moscow, Lewiston and Spokane. Wal-Mart, said Ried, hopes to retrieve those dollars rather than take money away from other retailers in town.

Asked how Wal-Mart can justify building super centers here and in Moscow, Ried said the company is not in the habit of cannibalizing its own. "They will not open a store unless they are confident to make money," he said. "They site their stores to prevent cannibalism."

Members of the Moscow City Council eight miles away are also dealing with the potential construction of a second Wal-Mart Supercenter. Once a Wal-Mart gets established, said Ried, it's common for a super center of the size proposed to do about $70 million in annual sales.

The Pullman hearing stems from PARD's appeal of actions by the City of Pullman that have thus far cleared the way for construction of the 223,000-square-foot store. The super center is designed to include a grocery store, garden center and gasoline station in addition to a retail merchandise outlet.

Under questioning from Wal-Mart attorney John McCullough of Seattle, Ried said the super center would "compliment" Pullman's economy.

That brought a series of questions from attorney Brian McGinn, who represents PARD. "I'm surprised to hear a lot of this for the first time today," McGinn told Ried. Members of PARD have been asking the city for some sort of economic study. But officials said city concerns are only with infrastructure, safety, environmental, and direct public cost questions.

The two-day hearing, before examiner John Montgomery, started last week and included public testimony from people for and against the arrival of Wal-Mart. Montgomery, a Spokane attorney, will make a determination on the appeal, either upholding the city's actions or calling for other action. PARD, Wal-Mart, and the city have the right to appeal Montgomery's decision to the Whitman County Superior Court.

During the morning session of the hearing, much of the testimony swirled around experts for PARD and Wal-Mart disagreeing about traffic studies. Rick Nys, a consultant hired by PARD, said a traffic impact study done by CLC Associates of Spokane (at Wal-Mart's request) was "flawed" and "inadequate."

But Kevin Picanco, representing CLC, defended the study and said his conclusions are all based upon standards set by the City of Pullman and the Washington Department of Transportation, both of which reviewed and signed off on the traffic analysis.

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