Wal-Mart has learned the hard way not to pick a fight with Hercules. On December 15, 2008, Sprawl-Busters reported that the city of Hercules, California had flexed its muscles and pinned the giant Wal-Mart corporation to the mat. It took more than two years to win the match. On December 2, 2006, Sprawl-Busters first noted that the city council in Hercules had voted to use its eminent domain powers to acquire a parcel of land owned by Wal-Mart. Residents opposed to Wal-Mart applauded the move, but the retailer’s response at the time was, “Eminent domain is not supposed to be used as a popularity contest.” The city ruled that Wal-Mart’s property was economically “blighted” because of the lack of activity there. The city said Wal-Mart’s plans to build a supercenter did not conform to a 64,000 s.f. store size limit at the so-called Bayside Marketplace. In late 2005, Wal-Mart purchased the Bayside Marketplace to build a superstore, but this set off a public explosion of opposition from residents who argued that the project clashed with the Central Hercules Plan, which calls for a pedestrian-oriented waterfront development. In September, 2006, the city reaffirmed the Hercules Redevelopment Agency’s authority to invoke eminent domain in a part of the city known as “the Dynamite Area,” and extended this power for 12 years. But Wal-Mart argued that the Hercules Redevelopment Authority’s power to invoke eminent domain in this case had expired. The city council argued that its action was a “resolution of necessity,” which allowed the Hercules Redevelopment Agency to initiate an eminent domain action without a further council vote within six months. The city would have paid Wal-Mart the fair market value for the property. Wal-Mart’s suit against Hercules was filed Nov. 7, 2006 in Contra Costa Superior Court in Martinez. On June 18, 2007, Sprawl-Busters noted that a Contra Costa judge invalidated the Hercules ordinance that was used to justify the city’s eminent domain action. The city charged that Wal-Mart had shown bad faith by filing application after application for a store that would exceed the size limit under a 2003 development agreement with the previous owner of the tract. The parcel remained fallow, leading to a finding of economic blight by the city. Wal-Mart’s most recent application last year was for a 99,000 s.f. store, shrunk from the 140,000 s.f. size of two earlier applications. The city said the size limit for the Dynamite Area parcel (named after a former dynamite plant there) was 64,000 s.f., but Wal-Mart said a 168,000 s.f. store was allowed on the roughly 17 acre parcel. Wal-Mart brought its case on the grounds that the city’s eminent domain power had expired, and that the property was not physically and economically blighted. Contra Costa Superior Court Judge Judith Craddick agreed that Hercules had not made the case that the property was blighted — but she did not address the issue of the expiration of eminent domain power. “We’re pleased with the judge’s decision confirming that the city’s ordinance was not valid,” a Wal-Mart spokesman said at the time. “We’re looking forward to working with the city to complete the application process and bring a very distinctive new store to the community.” But things never got back on track for the retailer’s superstore in Hercules, and the West County Times reports in December of 2008 that Wal-Mart had dropped its plans altogether, and put its 17 acre site up for sale. Despite winning in court, Wal-Mart never filed another application in Hercules. A company spokesman said last December that Hercules customers are already well served by Wal-Mart stores in nearby Richmond and Martinez. The company hired a private broker to sell the site. This week, roughly four months after the land went on the market, the city of Hercules has agreed to buy the land — without having to invoke eminent domain powers. Wal-Mart is reportedly selling the land for $13.85 million. Hercules Mayor Joe Eddy McDonald announced the deal after an executive session of the City Council. Steve Kirby of the Friends of Hercules, who opposed the superstore, said the city acquisition of the property was a good next step. “From the beginning, the city had a plan for this area,” Kirby told the Bay Area News, “but the developer did not come in within that framework.” Kirby now hopes that the city “can find developers and plan it just the way they want it, and make it fit in with the walkable, people-friendly community.” In other words, create a project that the city can live with.
Eminent domain is a powerful tool. The municipal police power that allows a community to take property for a public purpose has been a controversial move — whether used to promote development, or to stop it. In more cases than not, cities and towns have used eminent domain powers to promote a big box store, but in a few cases, the method been used to stop development. Even though Wal-Mart succeeded in getting the court to overturn the eminent domain ruling by the city, Wal-Mart never filed another application in Hercules. “Ultimately, we decided we could serve our Hercules customers through our Richmond and Martinez stores,” Wal-Mart admitted. “We are very happy to be able to provide them with a shopping experience, close to their city if not in their city, that allows them to save money so they can live better.” Wal-Mart would provide no further insight into its decision, other than saying “a number of factors” came into play. Steve Kirby of the Friends of Hercules, told the West County News, “A city should be able to determine some land uses and make a master plan. The arrogance, the audacity of Wal-Mart to come and say, ‘We’ll ignore that and build a 150,000-square-foot-store.'” Wal-Mart told city officials that it considered the municipal size limit on stores to be merely a guideline. The company started off with a 147,000 s.f. store, dropped it to 142,000 s.f. and finally to 99,000 s.f. When Hercules decided last year to invoke eminent domain powers against Wal-Mart, it was like placing a stick of dynamite in the center of the retailer’s expensive plans. None of this court activity would have happened if the retailer had not set flame to fuse in Hercules by proposing a project so huge that it blew up in its face. Rather than fit in, Wal-Mart in essence detonated its own plan. Wal-Mart knows that people consider its stores to be enormously similar to one another, so the company is now claiming at every turn that its project in any given town will be “very distinctive,” by which they mean it will have a different skin than the several thousand box stores they have created as their legacy. Rather than work with the city, Wal-Mart chose a confrontational approach, which led to a courtroom, not a ribbon-cutting. Readers are urged to email Hercules Mayor Joe Eddy McDonald at [email protected] with the following message: “Dear Mayor McDonald, I am thrilled to hear that the city has reached an agreement to buy the Wal-Mart parcel, officially ending the company’s quest to build a superstore in Hercules. Even its final plan at 99,000 s.f. did not fit into your land use plan, and the retailer could have spared the city and themselves a great deal of time and money if they had shown some respect for the city’s plans in the first place. The city was right to stand up for its residents, and against sprawl. Some people think it is a Herculean feat to stand up to a big corporation like Wal-Mart. Hercules has literally accomplished its own Herculean effort, and demonstrated that small towns can beat large corporations. Wal-Mart tried to muscle its way into Hercules, but you stopped them cold.”
