ECONOMIST DISCUSSES WAL-MART’S IMPACT ON COMMUNITIES IN SOLEDAD, CA

Speaker: Wal-Mart impact negative [The Californian]

Kenneth Stone, an economist who has done research on the impact of Wal-Mart in communities across the country for more than 20 years, warned an audience at the National Steinbeck Center in Salinas Monday about the negative long-term impact the retail giant could have in Soledad.

Based on his studies conducted in California, Iowa and Mississippi, Stone told about 25 people in attendance that a new Wal-Mart may help a few businesses but there is no guarantee city sales-tax revenues will increase. In fact, he said, sometimes the sales taxes decrease.

“I’m trying to educate people on both sides of the equation,” he said. “A new Wal-Mart may help a few firms but it will probably hurt a lot more in the long run.”

Stone spoke in Salinas as part of a two-day visit which includes a presentation in Soledad at 7 p.m. today at the Soledad YMCA, and a stop at the Salinas City Council meeting at 4 p.m. He is addressing concerns of whether a 215,000-square-foot Super Wal-Mart should be built in Soledad.

Stone said Wal-Mart has established its super stores in bigger markets - cities of more than 50,000. But now the retailer is looking at smaller, rural markets such as Soledad with a population of 27,701.

Stone said studies in three states have shown that the total retail sales in the host town increased initially as Wal-Mart keeps more people at home to shop, and draws customers from the surrounding area.

But as time goes on these stores and other big- box retailers establish too many stores too close together, shrinking the “retail pie” for host communities.

In the first year, the percentage of total retail sales for the states studied increased by 5.5 percent but by the fifth year it was down to a negative 1.5 percent, Stone said.

Kevin Loscotoff, senior manager for public affairs and government relations at Wal-Mart, questioned Stone’s knowledge of the community in Soledad, because he lives in Iowa.

“We are interested to hear what he has to say,” Loscotoff said, but added that he wouldn’t be able to attend any of Stone’s presentations.

“But we continue to hear an overwhelmingly support for Wal-Mart and we’ve heard many positive things from the residents.”

Posted by Tony Calero on Tuesday, August 05, 2008

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