On March 24th, Sprawl-Busters reported that a Wal-Mart supercenter was headed towards a key vote by the Planning Commission in Galt, California.
Like most cities, local officials in Galt see Wal-Mart as a jobs and revenue proposition — but they have no hard evidence that really looks at the economics of what happens when Wal-Mart comes to town. In the case of Galt, a new Wal-Mart will result is just a shifting of market share from existing merchants to the giant retailer. Many residents in Galt seem to understand that — but not city leaders.
Galt’s retail area is perhaps best known for the Galt Market, which began as a farmer’s market at the old Sacramento County Fairgrounds in the 1950’s, and today is an expansive open-air collection of over 400 vendors covering ten acres of great deals.
As the city says, “the Galt Market is an inviting place to spend a relaxed day, looking for bargains, having some good food and taking home fresh produce for dinner. There is truly nothing like it anywhere else, as it’s over three quarters of a million annual customers can testify.” In this context, a suburban sprawl Wal-Mart makes no sense at all. It is incompatible with the ‘nothing like its anywhere else’ character of Galt.
On September 18, 2007, Sprawl-Busters reported that the City Council in Galt was reviewing a proposed zoning ordinance that would ban any retail stores larger than 140,000 s.f., if it had more than 10% of its interior retail space devoted to non-taxable goods, like groceries.
The proposed law in Galt also would require stores between 100,000 to 139,999 s.f. to apply for a conditional use permit. Developers would also have to produce impact studies on the project’s effect on crime, urban decay, the economy and the project’s general compatibility within a neighborhood.
In late September of 2007, the city’s Planning Commission approved by a vote of 4-1 the proposed big box ordinance, which officials said would apply to the proposed Wal-Mart supercenter in Galt. The commission lowered the size limit for certain stores to 120,000 s.f. that devote 10% of their floor space to selling groceries, or non-taxable goods. The Lodi News said the supercenter has 19% of grocery space, but usually a supercenter has 35% to 45% grocery space.
On their way out of the Planning Commission in 2007, a Wal-Mart spokesman told the News, “We weren’t expecting this outcome today. Our current application would be out of compliance with this ordinance. The recommendation would prevent us from building a store identical to the ones we have in Elk Grove and Lodi. We are looking forward to the City Council further reviewing and listening to the public comment. We will have to regroup with our team.”
Planning Commissioner Eugene Davenport told the newspaper two years ago that he didn’t trust companies like Wal-Mart. “It’s unacceptable that we are letting these corporations come in and tell us what they are going to do,” he said. “It is our job to protect the citizens of Galt with smart planning.”
Within weeks after the Planning Commission vote, the Galt City Council voted 4-1 to adopt the big box ordinance. But Wal-Mart was not deterred. Two and a half years later, Wal-Mart was back before the Galt Planning Commission.
The Planning Commission had to review Wal-Mart’s Conditional Use Permit, Final Environmental Impact Report, Compliance with the Big Box Ordinance, and appeal of the Community Development Director’s Notice of Decision on Site Plan and Design Review. The staff analysis of the project looks like it was written by Wal-Mart.
This project violates one of the key provisions of Galt’s General Plan: “Local-Serving Commercial — The City should pursue locally-oriented commercial uses and prioritize those uses that are underserved in Galt. The City should also expand upon the existing base of local-serving retail and service establishments as population increases create additional market demand.” Incredibly, planning staff concluded that “The proposed project would expand and provide new retail options in close proximity to local consumers by providing daytime and nighttime shopping opportunities.”
Staff also concluded that Galt is “underserved by retail options” despite the easy access to other Wal-Mart stores in the area. This project is also only 60 feet from the nearest residential home. A 12 foot sound wall has to be erected to buffer nearby homes from the noise of this project.
In Galt, projects also have to show a positive fiscal balance for the city, and staff concluded that Wal-Mart would generate $497,624 annually in revenues from property and sales taxes, and cost only $37,890 in city costs. Staff says the project will create another “$230,000 per year in sales tax revenue that is ear marked for police services only.” But the city failed to examine the fiscal impacts of other stores closing, and falling sales tax revenues.
The city’s General Plan also says that “smart growth principles… shall be incorporated into development project proposals.” Staff could not find any smart growth principles, so instead praised the project’s use of “ozone friendly refrigerants” and “energy-efficient HVAC units.”
Finally, developments in Galt are supposed to be “compatible with neighboring uses.” The planning staff found that “impacts related to cumulative traffic and cumulative
aesthetics would remain significant and unavoidable.” In other words, neighbors will just have to live with those negative impacts.
This past week, a crowd of 200 people showed up for the Wal-Mart hearing. The Planning Commission voted 4-1 to approve the 133,000 s.f. Wal-Mart proposal. But the Planning Commission’s vote will lead to an appeal — not to a ribbon cutting. It is expected that an appeal will be filed soon to force the matter to the Galt City Council. In a small concession to the neighbors, the Commission voted to cut back the operating hours for the store to 6 a.m. to 11 p.m.
The Commission’s vote was influenced by the ‘voodoo economics’ of Wal-Mart. One Commissioner told the Lodi News that although the Wal-Mart plan was not perfect, that Galt needs the added revenue. Another Commissioner said it was critical to keep sales tax revenue from leaving Galt and going to other cities.
Residents repeated their position that they wanted a store no bigger than 100,000-square-foot store, which was supported by one Commissioner. “I’m not going to approve this at 130,000 square feet. There is no city infrastructure to support it,” the Commissioner said.
This case now moves to the Galt City Council for a final decision. Economics are likely to play a major role in their decision too.
In terms of impact on other stores, the city’s planning staff report found that “At worst, $6.5 million in food store sales will be diverted away from existing primary market area retailers… the Project would not result in adverse impacts to retailers because although some stores would experience reduced sales in the short-term, these stores are expected to achieve stabilized sales within three years.” But this is just wishful thinking. An independent assessment of this store’s impact has not been done.
Readers are urged to email Galt Mayor Randy Shelton at [email protected] with the following message: “Dear Mayor Shelton, Please remember the people who live near the Wal-Mart project before the city council votes on the latest Wal-Mart plan. This project is way too big, and in its suburban layout is incompatible with the character and built environment in your distinctive city. Wal-Mart is trying to game your Big Box ordinance by building as big as they can. But as you have told voters, “We need to… bring responsible Smart Growth” to Galt. Your residents have lots of places to find big box stores nearby, but there is only one Galt Market. Keep your city unique, and keep the Wal-Mart’s out. This project is too close to nearby houses, needs a massive wall to block noise, and is not an example of smart growth. It will harm locally-serving retail uses. One independent study of Wal-Mart has concluded that for every one Wal-Mart superstore that opens, two grocery stores will close. Before you start counting your future revenues from this project, remember that it’s the net revenues you need to calculate — not the gross revenue. Wal-Mart is a form of retail musical chairs. It moves money from existing cash registers to its own stores. That is economic displacement, not economic development. This project is also inconsistent with your General Plan in many areas. Shrink the store to below 100,000 s.f. and let Wal-Mart fit Galt, not the reverse.”