What’s in a name? The people in Milpitas, California are wondering what kind of a word game Wal-Mart is playing with them. The city is becoming embroiled in a controversy spawned by Wal-Mart that could easily have been avoided. Wal-Mart decided that its existing discount store in Milpitas, which is 131,725 s.f., was not big enough. So the retailer approached city officials with a plan to add 18,457 s.f. to its existing store on Ranch Drive. According to the Milpitas Post newspaper, Wal-Mart has reached the point where it submitted a draft environmental impact report (DEIR) to the city’s Planning and Neighborhood Services Department on Nov. 5. “It’s a pretty small expansion,” a spokesperson for Wal-Mart told the newspaper. “It will be a Wal-Mart store with a supermarket.” Wal-Mart is not referring to this 150,182 s.f. store as a supercenter, even though the store will have fresh produce, baked goods, a deli and other grocery items. The retailer says that expanded the store would create 85 “additional” jobs, but that is a gross figure, not net, because it fails to calculate the jobs that will be lost elsewhere in the Milpitas trade area. The spokesman also claimed that the “majority” of the new jobs would be full-time workers earning an average of $11.90 an hour — but many of these jobs will be part time positions paying even less. Wal-Mart is deliberately not calling this store a supercenter, and if the expansion happens, the store won’t say “supercenter” on the outside. Part of Wal-Mart’s new branding is to leave off the word “supercenter”. The new Wal-Mart application was approached cautiously by Milpitas Mayor Bob Livengood. The Mayor did not come out and embrace the proposal. He told the Post that he wanted to see more information on the plan before reaching a decision to support it or not. “I’m going to stay open minded until we get more information,” the Mayor said. “I want to be fair to them.” City officials may also be concerned about the impact of another grocery store coming to Milpitas. There already is a Nob Hill, Lucky’s, and Safeway in the city. But the President of the local Lion’s Club was effusive in her praise for Wal-Mart. “There’s going to be a lot of regional business,” said the Lions Club president. But it turns out her vote was for sale — and cheap at that. She admitted to the Post that her Lion’s Club was on the verge of getting a small grant from Wal-Mart. “Right now our club is about to get $1,000 from Milpitas Wal-Mart,” she revealed. Wal-Mart apparently thinks its store expansion should be tied to the fact that the company gives money to the Milpitas Food Pantry, the Parks and Recreation Services, and Milpitas’ School District. If this were the case, zoning projects would be based on who gave the community the most donations. “We’ve been giving since we opened our store in Milpitas in 1994,” the Wal-Mart spokesman said. Some city officials don’t need to be bribed with small donations. The Milpitas Economic Development Manager points out that Wal-Mart is one of the top five sales tax producers in the city.
Now the city has to review the DEIR that Wal-Mart submitted, and go through the California Environmental Quality Review Act (CEQRA) process. The DEIR review will look at such issues as Wal-Mart’s impacts on air quality, land use, biological resources, hazardous materials, water quality and hydrology, noise, public services and utilities, transportation, and the project’s building aesthetics. For the next several weeks, the public has the right to comment on the DEIR. Once the comment period ends, the final EIR will be reviewed by the Milpitas Planning Commission, which has to approve a site development permit, a conditional use permit to allow grocery sales, 24 hour operations, and the sale of liquor. The city has the right to deny the store a permit to remain open all night, and could deny the retailer a liquor license. If Wal-Mart got final approval to build, it would be another year before the building was ready to open for the public. This is not a jobs or revenue project, however. Wal-Mart is saturating the area with stores. There are already 7 Wal-Mart stores within 15 miles of this Milpitas location — none of them supercenters. Wal-Mart has been trying to push supercenters in California, but has run into a Wal of opposition at almost every turn. That could explain, in part, the decision to not call a supercenter a supercenter. The company has smaller stores that are called superstores, and the main feature of a supercenter is the combination of groceries with discount goods. The controversy that will be generated by this store is totally unnecessary, because Wal-Mart has other options it is not pursuing. The retailer could take the existing discount store, and ‘convert’ it into a supercenter without adding one square foot, or seeking one new permit. This is called an “in box conversion,” and the company is doing it in several other locations across the country. Wal-Mart told Wall Street analysts at its recent annual meeting that the company expects to build smaller, more efficient superstores in the future. The hearings, the opposition, the expense of studies — Wal-Mart could have avoided all of this. Readers are urged to email Milpitas Mayor Robert Livengood at [email protected] with the following message: “Dear Mayor Livengood, The proposed expansion of Wal-Mart brings no added value to your local economy. In fact, it will drain more investment from your city, because national chain stores extract local dollars compared to locally-owned businesses, which put most of their money back into the local economy. Don’t be fooled by Wal-Mart’s claim of new jobs. If you want to find where those jobs came from, go to Safeway, or Lucky’s, or any of the smaller merchants that will lose sales when Wal-Mart expands. Most importantly, Wal-Mart does not need this expansion at all, and in fact has taken stores this size — as in Milwaukee — and just converted them from a discount store into a superstore without adding anything to the square footage. This is called an ‘in-box conversion,’ and you should ask Wal-Mart why it needs to build more floor space when the company today is capable of building 70,000 square foot superstores. Unless you insist on something more to scale for Milpitas, you are going to waste more land, and hurt more businesses, just to give Wal-Mart a larger share of the local pie. Tell Wal-Mart to forget their expansion. Let them know that your office wants to spend its time working on real economic development, not economic dislocation.”
