Residents in Beaver Dam,Wisconsin were stunned to learn that their local officials had been secretly working on a massive infusion of public tax dollars for a plan that would annex land and rezone it in order to bring a Wal-Mart distribution center. The latest Wal-Mart corporate welfare plan involves $6.18 million in tax subsidies to pave the way for the richest retailer in the world. According to the Milwaukee Journal Sentinel, local officials negotiated the deal in secret over a period of 11 months. A formal complaint has been filed with the Dodge County district attorney, alleging that the City Council violated state open meetings laws. A group called Citizens for Open Government (COG) has hired a law firm to try and overturn the welfare deal and bring the public into the process.
“The City Council needs to understand that they should conduct their meetings openly,” said Chuck Sena, a memeber of COG. The Wal-Mart plan is to construct a 1.2 million square foot distribution center in Beaver Dam. Similar proposals elsewhere in the nation have stirred local opposition, and often involed tax subsidies. The Beaver Dam City Council has already voted to annex 400 acres of land for the project to make this deal happen. The Council has also inked an agreement with Wal-Mart, without citizen involvement, that calls for the following breaks for Wal-Mart: the city will spend $800,000 on infrastructure improvements for water, sewer and fire service; the city will even subsidize payment for the land by giving the company $1.38 million, plus another $4 million over the next 20 years. The total cost of the land is $5.5 million, so the city is essentially giving Wal-Mart the land at taxpayer’s expense. Wal-Mart has to commit to creating 450 jobs by 2008. Once the distribution center is up and running, it will feed merchandise to regional Wal-Mart supercenters, which will in turn destroy jobs at other merchants, whose tax dollars helped subsidize the Beaver Dam giveaway to Wal-Mart. The Mayor of Beaver Dam admitted to the newpaper that the city’s deal with the retailer was “pretty much an accomplished deed right now.” The council is scheduled to vote on rezoning the property in February. Madison attorney Christa Westerber, whose firm has been hired by COG, told the Journal, “It boggles my mind that the City of Beaver Dam, by their own admission, could work for 14 months on this and the citizens not know about it until Month 11.”
Unfortunately, this corporate welfare mentality is a pattern in the development of Wal-Mart distribution centers. Many local officials, enticed by the prospect of warehouse jobs, offer a candy store full of giveaways for Wal-Mart — a company which made more than $6 billion in profits last year. Although Wal-Mart can easily afford to buy land and build its own warehouses, public officials throw public subsidies at the company. Smaller businesses in Beaver Dam receive no such incentives, but end up helping to pay for the welfare that helps Wal-Mart put competitors out of business. For other egregious examples of tax gifts to Wal-Mart, search this database by the words “corporate welfare.”
