WASHINGTON — Empty Budweiser beer cans, Arizona iced tea bottles, and other debris litter the ground of a largely vacant strip mall in the Skyland neighborhood, an area federally designated as a "food desert" for its lack of grocery stores.
Skyland is part of the District of Columbia's Ward 7, where a majority of residents are low-income African-Americans and the unemployment rate is 13.9 percent. A few miles away, the affluent, mainly white Ward 3 has numerous grocery stores and a 2.1 percent jobless rate.
Walmart Stores Inc. planned to open a 125,000-square-foot store here, anchoring an ambitious, $200 million residential and commercial development that Mayor Vincent Gray has long crusaded for as a means of turning around not just the neighborhood but the entire depressed area east of the polluted Anacostia River.
It was to be one of six new Walmart stores in the U.S. capital — until now.
The D.C. Council passed a bill requiring nonunionized, big-box retailers such as Walmart to pay workers $12.50 an hour, more than 50 percent higher than other companies.
Now the nation's largest retailer is threatening to abandon three and possibly all six of its D.C. projects, forcing Gray to choose between the city's powerful unions and his dreams of redeveloping Skyland and other poor areas in the city. "It creates wage standards for a handful of employees while exempting two of the largest (employers) in the city, Safeway and Giant," Walmart spokesman Steven Restivo said. "It's discriminatory, arbitrary and discourages investment in D.C."
Walmart said the six D.C. stores would add 1,800 jobs.
Union leader Joslyn Williams, who has lobbied for the bill since 2007, called Walmart's response "outright blackmail." The bill allows retailers to include benefits in the wages, which Williams said provides flexibility.
"They can afford it, and they're worried about other cities saying, 'You come in here, you ought to pay a living wage,' " said Williams, president of the AFL-CIO Metropolitan Washington Council. "But even $12.50 is not enough. It only gets you to $26,000 per year."
Entry-level pay at area grocery chain Giant is close to the District's $8.25 minimum wage, plus negotiated benefits, said Mike Wilson of Respect D.C., a grass-roots coalition supporting the bill. Giant and most other large grocery stores in the D.C. area would be exempt from the higher wages because they are unionized.
If Gray decides to veto the bill, the council isn't likely to have enough votes to overturn it. The council voted, 8-5, to pass the local law.
Council member Yvette Alexander, who represents the Skyland neighborhood and the rest of Ward 7, had opposed the bill because she fears that it would drive retailers away.
"The premise was from a lot of anti-Walmart activists and unions," she said. "I think it was an effort to say, 'Walmart, we don't want you in this District.' "