|PAUL GLOVER ESSAYS: community
control of food, fuel, housing, health care,
planning, education, finance.
Does Ithaca Need Wal-Mart?
by Paul Glover June 1994
We've got another big decision to make. Wal-Mart is asking the people of Ithaca for permission to build the largest store in Tompkins County within our city. Our choice, conveyed through the Planning Board, should be considered carefully, because it will dramatically affect this community's jobs and wages, traffic, taxes, consumer prices, hospital access, flood control, tourism, air quality, and wildlife.
Several of Ithaca's leaders have reassured us that Ithaca would be a better place to live if Wal-Mart opens here. Ithaca's mayor, Ithaca's daily paper, Ithaca's Planning Department, Ithaca's Board of Zoning Appeals, and numerous enthusiastic shoppers have opened our doors to them. They believe that the city will gain jobs (or lose fewer), that the city and school district will gain revenue (or lose less), that local businesses will survive Wal-Mart by adapting, that consumers will have lower prices and more choices.
The Wal-Mart sponsored Impact Statements, however, (by RKG Associates and Sear-Brown Group), and the experiences and studies of cities elsewhere, give us very different information.
We're told that City Hall will gain $405,000 to $490,000 sales and property tax yearly (less than 2% of the City's 1994 income) if Wal-Mart locates in Ithaca. But the RKG consultants recommend that downtown parking would need to be free to allow the Commons to survive Wal-Mart competition (p.17). Free parking downtown means a loss to the City of at least $865,000 per year ($725,000 downtown parking fees/year lost + $140,000/year cost for downtown parking garage maintenance, staff, and bond payments:
1994 Ithaca City Budget, pp. 50, 58-59, 61).
On this account alone the City would suffer a net loss of at least $375,000- 460,000. Even if just half the downtown parking revenues were lost because of Wal-Mart, to free parking days or shift of shopper parking, the City would lose about $50,000 net.
At the same time, the study Fiscal Impacts of Mall Development (Armstrong, 1989) indicates that each new major shopping mall typically requires a city to hire two more police officers. These officers would cost Ithaca a total of approximately $60,000.
There are plenty other costs not calculated by the EIS. The City itself is already accepting a $250,000 bond burden, to fix the Meadow Street/Elmira Road intersection that the Wal-Mart study says would need widening to handle Wal-Mart traffic (1994 Ithaca City Budget p.63) Additional related upgrades would be expected as traffic rises.
Nor would Wal-Mart property taxes necessarily benefit the Ithaca City School District. About half of the district's state aid is calculated as a ratio of students to equalized property value. Thus, adding a multi-million dollar shopping mall to tax rolls "could have a net negative impact" on District income, according to Gary Lindenbaum, Assistant Supervisor for Business Services of the Ithaca City School District. Yet no one has asked that office for an assessment.
There is an even more serious loss to the city that the study did not calculate, from sales tax not collected because of loss of multiplier sales provided by locally-owned businesses. That is, the more each dollar bounces around town before leaving, the more job creation, sales, and sales tax it generates. Every dollar spent with a locally-owned business gets spent here an estimated 2.3 more times than when spent with a company which takes its profits out of town (ILSR Study, 1980). By this formula, if 25% of the sales diverted directly and indirectly by Wal-Mart are from locally-owned stores, then the sales tax loss would total $182,000 more than RKG estimated (p. 14). This multiplier benefit is lost when Wal-Mart replaces smaller local businesses. The RKG study does not analyse this.
The RKG EIS admits that Wal-Mart would take jobs away by killing businesses here today. "Because there is no obvious source of unmet retail demand by the local population... a greater portion of Wal-Mart's projected sales would need to be captured from existing area stores (p.5)." This is expected to be over $20 million per year (p.10), of which about $7 million are lost by city stores. Mass merchandizers can expect losses between 10% and 33%. Other stores would lose 2%-4% of sales. Downtown businessman Jeff Furman remarks, "The Ithaca Journal quoted the RKG study, saying only 4% of store income would be lost. Four percent is a lot for these struggling small businesses. We're talking about their margin for existing."
RKG's study admits as well that "While some area merchants could have absorbed a marginal reduction in sales to new competition in years past, their ability to absorb future sales losses has been weakened by the recession (p.85)."
Wal-Mart claims to create so many jobs by selling so much stuff, that we wouldn't need the jobs lost in the stores that close. The RKG study does not explain this conclusion. But a Massachusetts study says a typical Wal-Mart adds 140 jobs and destroys 230 higher-paying jobs (Donella Meadows, professor, Dartmouth). Another independent study not purchased by Wal-Mart (Humstone Associates, 1993) projected an expected net loss of 200 jobs in St. Albans Vermont, because Wal-Mart sales are less "labor intensive" than small locally-owned businesses: Wal-Mart employs 70 people for every $10 million sales, while small retailers employ 106 people per $10 million sales (Humstone, p.20). Why such different job estimates? The RKG study, for example, does not include the closing of Woolworth's, with dozens of jobs, even though "It can be assumed that a major share of the transfer [of sales] would be borne by Woolworth's and CVS Pharmacy (p.103)." A Wal-Mart in Ithaca would have an impact like the Watertown Wal-Mart (p.76). The Watertown Woolworth's saw a double-digit drop in sales, mostly because of Wal-Mart there (p.xii).
The EIS does not describe the closing of other Commons businesses, or the loss of those jobs that follow from the closing of Woolworth's. Nor does the EIS calculate the net job change resulting from Wal-Mart's "induced development" on Elmira Road, which takes even more business (>$1,000,000 sales) away from downtown.
The EIS quotes business people who have survived the five Wal-Marts which surround Ithaca. Yet these are new Wal-Marts, just one or two years old, which have not had time to do full damage. The famous study by Kenneth Stone (The Impact of Wal-Mart Stores, 1993), shows that business failures accelerate after Wal-Mart has been in town three to five years. "While Wal-Mart may be thriving, the decline in the rest of the stores means that the net effect is a drop in the number of dollars spent in town" (Stone, Mississippi Business Journal 6/88). He adds, "the money a Wal-Mart drains from the community won't come back; it isn't in the hands of local people who might invest it back in the community. Then you lose a sense community loyalty, that small town atmosphere, and you are in danger of becoming a bedroom community. You don't have business and civic leaders; you have transient managers." As the Valley News of Plainfield, New Hampshire says, "Fewer merchandising profits circulate within the community. Wal-Mart profits go to Arkansas. Wal-Mart handles most of its insurance, legal services and banking at its headquarters, too" (6/93).
As if these facts were not ominous enough, the RKG report expects a sudden 10% leap in Wal-Mart sales taken from existing stores, five years later, when it expands to 155,000 square feet. After ten years, Wal-Mart would be taking 17 million dollars per year from businesses here today (p.96). "The Ithaca Wal-Mart will be one of the chain's largest area stores (p.8)," with 45% of the floor area of competitive stores on the Commons. Their parking lot, 50% larger than Wegmans, would be so large that shoppers would walk 560' (one ninth of a mile) from the farthest parking spot to an entrance. To get an idea how big this mall & lot would be, walk around all four Commons blocks (bounded by Aurora, Cayuga Seneca and Green).
There is no analysis of the loss of tourist dollars from this Wal-Mart and related urbanization. People come to Ithaca to visit a small city and big lake, surrounded by forests and waterfalls. They do not come to see waterfalls surrounded by malls. The specialty shops found only in Ithaca contribute to our community's identity, too. Fewer tourists would come here to visit Anytown, USA. What is the effect of this loss on sales taxes?
INSIDE OR OUTSIDE THE CITY
Even some of those who have not wanted an Ithaca Wal-mall have preferred it inside the city because they are afraid that if Wal-Mart located south in the Town of Ithaca or north in Lansing they'd take jobs and taxes away. However, the Town of Ithaca has already told Wal-Mart the largest suitable Town parcel available is only nine acres, far too small for their mall (confirmed in writing by Supervisor
John Whitcomb). Moreover, the city controls a two-lane constriction of Route 13 at its south gate, making major development toward Newfield impractical. Lansing is not suited to Wal-Mart: "It is the intent of [Wal-Mart] to develop a major retail presence in the heart of Tompkins County (p.46 5.0)." "The Elmira Road area received the strongest consideration. The proposed site was the only available parcel [there] that is large enough to support the Wal-Mart Department Store. The location of appropriate sites precluded the assessment of alternative sites (p. 46, 5.2)." In Lansing, all prime land along Route 13 is already taken. There, Wal-Mart would compete head-to-head not only with Pyramid Mall, but with their own Cortland mall. Jamesway and Zayre's have already failed in that market.
Wherever they seek a zoning variance, Wal-Mart has always threatened to locate outside city lines if their permit is not approved. They have never yet cashed in that threat and accepted less than their first choice site. They go elsewhere.
Ten million cars cross the Route 13/Fulton/Clinton intersection every year. Wal-Mart is expected to bring so much more traffic to Route 13 that you'll wait even longer at that intersection even after a new multi-million-dollar bypass (the "One-Way Pair") is built (File FC13FSC.HC9). Also, "With the addition of traffic generated by the proposed development, low levels of service [traffic jams] will result at the intersection of Meadow Street and Elmira Road (v.1 p.35)."
If you're a commuter from south of the city, you'll donate 55 minutes per year to Wal-Mart, by waiting at their new stoplight (v.3 SD13SC.HC9). Add to this longer waits at existing lights. At the south end of the Elmira Road strip, Buttermilk Falls picnickers southbound would face a 24% northbound traffic increase during the next ten years, as they try to turn into the park.
This escalating traffic battle would not only make Route 13 travel slower, but would retard east-west traffic to and from Trumansburg, the Hospital, Cass Park, Treman Marina, Taughhannock Park and the Hangar Theatre. To prevent this danger and bother, each new major traffic generator needs a hard look.
Wal-Mart does not believe in fair enterprise. They cut prices long enough to kill competition, then raise them. Says the Wall Street Journal, "Wal-Mart uses its size and clout to bleed rivals dry" (11/18/93). They've been sued and convicted ($289,000 penalty) for unfair trade practices (WSJ 10/13/93). Wal-Mart's hidden prices, not shown on tags, are the costs already mentioned, to the city, to the environment, and to the community.
Mayor Nichols has emphasized, incorrectly, that the site is not technically a floodplain. About 85% of the acreage is within the 100-year floodplain (v.1, Figure 2). Nichols even claimed (Ithaca Journal 4/6/94) that it was dry during the flood of 1993. This is false, too. Betsy Darlington of the Conservation Advisory Committee took photos of ducks swimming throughout the site at that time. Cornell botanist E. Robert Wesley, hired to study the plants there said, "Most of the site is grassy old fields strongly dominated by reed canary grass. This is a very unusual species composition for an old field and clearly indicates that this is a floodplain (v.1 Appendix E p.2)."
PLANTS & FOREST
Wesley is likewise concerned about the adjacent Negundo Woods. "It is the best remnant of old floodplain forest in the Cayuga Inlet Valley. It contains a number of species [of plants] that are locally rare or scarce as well as some large, old trees, also it is remarkably species-rich" (ibid.). He hopes that contamination by oil and salt from the Wal-Mart parking lots can be prevented. He warns about possible damage from hydrology and surface drainage changes. Even with drainage sumps and vaccuum sweepers collecting parking lot runoff, large amounts of lead, zinc, and other chemical filth are expected to pour into the Inlet (v.1 Appendix H p.3). The EIS does not describe the effect on these woods of the expected 1/3" rise in floodwater which results from paving the site (v.1, p.30, 3.2.1), after packing it with 60,000 cubic feet of fill. Destruction of about 7" of fertile topsoil is not noticed by the EIS (v.1, Appendix C).
The field is the Great Horned Owl's supermarket. Five species of hawk and four more species of owl depend on these acres for food (v.1, Appendix D). Cornell bird expert William Evans names 41 more species of birds, including pheasants, bluebirds, warblers, kingbirds, catbirds and towhees, which rely on this land directly or indirectly for feeding, resting or nesting. The Negundo Woods mentioned above are "a significantly important stopover for neotropical migrant songbirds and hosts a wealth of breeding birds each year" (ibid.). He says that the western field is not important for nesting because of the "commotion" on Route 13, 1,000 feet away, but believes the damage to Negundo Woods nests, 300 feet from Wal-Mart, would be "avoidable." Were you evicted from your home tomorrow, or your house burnt down, a Cornell expert might declare it of 'no significant impact.'
Indeed, you can hire experts like football players, to push for you want to prove. RKG Associates, which produced this Environmental and Fiscal Impact study of Wal-Mart, has produced other Wal-Mart studies, all of which feature presumed Wal-Mart benefits. They provide "part of a comprehensive review" of the plan, which purports to be objective. However, they reveal their bias throughout. Good effects are "expected," bad effects "can be mitigated" or "avoided."
When describing aesthetics, they present computer images of the store, most of them hidden behind bushes. They think Wal-Mart would look good where the field was. They proclaim the store would be a model of the "integrity and orderliness consistent with Wal-Mart purpose" (v.1, p. 41). Even so, there would be only four tiny shrub beds in Wal-Mart's asphalt ocean (v.1, Fig. 8).
The study reassures us as well that "the proposed development is not expected to cause a significant increase in number of pedestrians..." (v. 1, p. 36). No mention is made of the effect on Route 13 bicycle travel, which is already dangerous. The study identifies Buttermilk Falls as a "noise receptor" but doesn't tell us how loud traffic will sound in the Park (v.1, p.28). Likewise, they merely assert there will be "no significant impact" on air quality (v.1, p.31), but have not studied it.
RKG Associates has been described by Al Norman (coordinator of the successful Greenfield, Massachusetts, opposition to Wal-Mart) as a "barnacle on the whale," one of several firms which thrives by studying mall proposals. Why should be expect them to condemn the damage Wal-Mart does? Without malls, there would be nothing for them to be paid to study.
Many people in Ithaca believe that anybody who has money and land should have the freedom to do anything they want with them. They believe the freedom of the rich to invest as they please is the cornerstone of our Republic, the source of all wealth, and the most precious of freedoms. Some believe that what is good for Wal-Mart is good for Ithaca.
Yet, laws have long restrained the free market from abusing other freedoms perhaps even more important, as by prohibiting child labor or slavery, challenging unsafe labor conditions, banning hazardous products, stopping false advertising, limiting pollution of water and air, penalizing union-busting, and preventing monopoly restraint of trade.
While Wal-Mart is not more evil than most corporations, they are big enough to have power over many lives. So when they are bad, they are very bad. They sell goods made by Asian children (NBC Dateline, 12/92). They prohibit dating between employees (NYT 7/14/93). Although the USA' s wealthiest retail employer, they oppose health care reform (Atlanta Const. 11/1/93). They've been targeted by AIDS activists (Publisher's Weekly 6/29/92), and by unions (national picket by UF&CW: NYT 5/3/93). They had to be forced by a federal court to declare themselves an equal employment opportunity and affirmative action employer (NYT 4/20/93).
Thus in Ithaca, New York, the law properly gives the people who live here more rights than corporations, to determine the uses of land. Within public limits, beneficial and socially-responsible enterprises can thrive.
Wal-Mart's request for 24 acres of Ithaca wetland is another of many opportunities for Ithacans to decide what kind of job base we prefer, what kind of community we value, and how we want to live. There are fine alternatives which build prosperity with local creativity, in the spirit of the Farmer's Market and Sciencenter. This decision is our responsibility, and now is our time to make it.
POSTSCRIPT: The Stop Wal-Mart campaigned brought enough pressure on the city's planning board that they voted for an extremely restrictive Wal-Mart site plan. Wal-Mart went away for 9 years. In 1996, City Hall prevailed, with an even bigger Target Store, at 200,000 square feet.