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Community Benefits Agreement for Wal-Mart?

Suddenly, without warning and little fanfare, the issue of a CBA has hit the radar of many local officials and interested residents.

For many others, the questions now become: What is a CBA (Community Benefits Agreement), and what does it have to do with a proposed Wal-Mart in Pagosa Springs?

First of all, there is no single firm definition for a CBA other than it is a contract between a developer and local governments or community groups (or both) stipulating certain conditions for mitigating economic issues, as well as providing amenities for communities. As such, CBAs include language addressing issues specific to a particular community’s concerns.

For instance, a CBA for a community where unemployment is high and residents with jobs work for low wages, without benefits, might stipulate a certain percentage of local hiring, with those jobs paying a livable wage, as well as providing health care and other benefits. A CBA could address environmental concerns (including a mandate for green construction), providing parks, open space or recreational facilities, investment in schools and job training programs, or funding for community organizations or programs. Indeed, the stipulations set forth in a CBA are nearly limitless.

As an example, after Wal-Mart announced its intention to expand its presence in the metropolitan Washington, D.C. area, the company agreed to a CBA that (among many other things) prohibited stores from selling guns and ammunition.

When SUN staff initially raised the issue of a CBA at a July 10 meeting, the question involved proposed assurances that, should Wal-Mart fail at its Pagosa Springs location and the facility become vacant, the building would be immediately turned over to the town.

In September 2010, Kroger closed its City Market location in downtown Pagosa Springs, and several businesses located in the shopping center adjacent to the store (those retail and restaurant spaces also owned by the corporation) also closed or moved. The four spaces remain vacant, the property unsold.

“The downtown City Market building is a blight on our community, there’s no doubt about it,” Pagosa Springs Community Development Corporation Board Member Mark Weiler said, advocating for a CBA discussion. “I’d like to encourage the planning commission to encourage Wal-Mart to enter into an open, honest, full-range Community Benefits Agreement with the Pagosa Springs Community Development Corporation.”

Later in the meeting, town planning commission member Cameron Parker thanked PSCDC board member Muriel Eason for providing a sample of a CBA that might be used in negotiations with Wal-Mart. While stating that he thought Eason’s document was overly restrictive, Parker went on to say, “I think there’s a lot of good things in the agreement … so I think there’s something in the agreement that both the town and the applicant can come up with something fair.”

However, commission member Cappy White was more explicit, placing into a motion (for a further design review scheduled for Tuesday, Aug. 14, at 5:15 p.m. in the Ross Aragon Community Center), among several conditions, “Discussion of a Community Benefits Agreement after the representatives from Wal-Mart hold a meeting with the CDC … some sort of commitment to some sort of percentage for local contractors.”

As of press time Wednesday, a CBA discussion between the PSCDC and Wal-Mart representatives had not been scheduled. The next PSCDC meeting is scheduled for Aug. 6 at 3 p.m. at the Quality Inn and Suites (formerly The Pagosa Lodge).

Typically, a CBA is developed by a coalition of community organizations, environmental groups, faith-based organizations and other interested parties. Whether or not a grass-roots CBA is hammered out and negotiated by the PSCDC remains to be seen. So far (given the recent interest in a CBA with Wal-Mart), no single group, entity or individual has stepped up to draft that agreement.

Nonetheless, in the ongoing controversy that has surrounded the location of a Wal-Mart store in Pagosa Springs, what is certain is that the issue of a CBA and what that could mean in future discussions has suddenly become a hot topic. Whether or not those discussions gather momentum as a CBA is built from the ground up, or if the matter falls flat and work is swept under the rug, the outcome could be determined during the next several months. During a three-and-a-half-hour meeting of the Pagosa Springs Planning Commission, Board of Adjustments and Design Review Board held last week, the issue of a Community Benefits Agreement was raised several times in response to Wal-Mart’s proposal to build a store in town.

Following a question by SUN staff regarding the consideration of a CBA, Weiler followed up by saying that both the CDC and the Chamber of Commerce had been working with local businesses to respond to the potential effects of a Wal-Mart.

“As far as a Community Benefits Agreement,” Weiler said, “a year ago, it was not on my horizon. It is now, however. And I think that’s a wonderful dialogue to have. And an entity that’s within the community, that is challenged with the development within the community is the Pagosa Springs Community Development Corporation. I, for one, would like to encourage the planning commission, as well as the town council, to ask Wal-Mart what their best practice has been in America so that we can have an idea of what they’ve done to mitigate the impacts they have on a community and enter into a discussion about a Community Benefits Agreement.”

Responding to Weiler’s remarks, supporters of Wal-Mart might say those impacts would be to the community’s benefit. Mostly trumpeting the potential for the creation of numerous jobs paying better than many local employers, supporters add that those new jobs will also provide benefits — something usually not offered by many local employers.

Supporters also point to increased sales tax revenues, convenience for local consumers (as well as drawing in customers from surrounding communities), healthy competition for existing businesses (with the theory being that prices would decline) and stanching the flow of dollars now being spent in Durango or Farmington.

For supporters, a CBA is largely redundant since benefits appear to be self-evident.

However, opponents of the development point to the assumption that most of the jobs created will pay sub-standard wages, placing an additional burden on local social service agencies as those workers seek to supplement meager incomes.

Opponents also claim that increased competition brought by Wal-Mart is a fixed game, asserting that the corporate giant’s policy of purchasing bulk product from foreign countries gives Wal-Mart a wholesale purchasing advantage mostly unavailable to small, local retailers. Secondly, opponents highlight Wal-Mart’s pricing policy that, buoyed by a large pool of capital, allows the company to sustain losses on some items priced below market in order to undercut competition and attract customers to the store for other, higher-priced products.

For opponents (and others), a CBA could be a meaningful, if minimal, response to perceived negative impacts brought by Wal-Mart. Even some supporters have said that it is time for the county and town to investigate a CBA for Wal-Mart and other large-scale developments.

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