We'd like to set the record straight with regards to claims that Wal-Mart is asking for a taxpayer subsidy to build in Cudahy. Those making this claim are wrong and are attempting to scare taxpayers and city officials.
Let us be clear: Wal-Mart will not receive, and is not asking for, any financial subsidy for its development.
It's important to know however, that the City of Cudahy created a tax-increment finance district (TIF) years ago to develop the Iceport site, which failed. The City of Cudahy borrowed over $5 million to invest in this site. The city has spent this money, development has not occurred and because of that, a tax base at the Iceport site does not exist to repay this debt.
We want to be part of the solution. Wal-Mart will indeed pay taxes and will create the property value necessary in the TIF to generate the revenue needed to finally make the Iceport site a success for Cudahy.
Continental Properties has put together a top-notch development that will create the tax base the city needs to repay its debt. At the same time, this plan brings a national discount retailer to the community and includes a state-of-the-art destination sports facility, retail shops and a hotel. All put together by a local, well-respected developer. It doesn't get much better than that.
Close to a month ago, the plan for Cudahy Station appeared to be dead. But following some careful, creative planning, and the persistent, positive support of Cudahy residents, the plan for Cudahy Station has been given new life.
Tonight (Tuesday, June 10), a new plan will be presented to the Cudahy Plan Commission that addresses the concerns that have been raised. A great deal of time and thought has gone into its development, and we are appreciative for the opportunity to present again and answer questions.
The success we've had at Wal-Mart is very real - and it's not only because we save people money, but because we help them live better. We do this in many ways, through jobs, opportunities, community involvement and of course, low prices that help stretch hard-earned dollars in today's economy.
We want to do that in Cudahy.
Please join us for the meeting tonight at 7 p.m. at the Cudahy Municipal Building to see the new elements in the plan and help us bring them to life in Cudahy.
Lisa B. Nelson is senior manager of public affairs for Bentonville, Ark.-based Wal-Mart Stores Inc.
11 Comments
I'd like to respond to Wal-Mart Executive Lisa Nelson's post today on the Milwaukee Biz Blog, in which she claimed Wal-Mart would be good for Cudahy.
Nelson points out that the city is currently in debt and seems to arrogantly imply that the city would be lucky to be saved by Wal-Mart's tax revenue. But the facts are simple: Wal-Mart has a long history of avoiding its full share of state and local taxes. In North Carolina, the state recently handed Wal-Mart a $33 million bill after it ruled the REITs tax scheme, in which the company would essentially pay rent to itself, was illegal. In Illinois, Wal-Mart was recently discovered to have been absurdly claiming that all of its state operations were based out of Florence, Italy, and you guessed it – was paying less taxes because of it.
Last year, the New York Times reported how Wal-Mart stores systematically challenge their property tax assessments to lower their property tax values and drive down their local tax bills. While saving several thousand dollars might help a Wal-Mart Executive's bottom line, it hurts communities across the country that are struggling to pay for roads, school and other valuable public works.
And all of this is in addition the laundry list of problems with Wal-Mart. The company's business model is single-handedly responsible for shipping thousands of Midwestern manufacturing jobs overseas and replacing them with low-wage, low-benefit retail jobs. On top of that, Wal-Mart is continually accused of discriminating against its employees and forcing its associates to work without pay.
By all means, Cudahy should have an honest discussion and decide for itself whether the town wants a Wal-Mart, but it can do without the steady draft of hot air coming from Bentonville. Lisa Nelson may think that Cudahy would be lucky to get a Wal-Mart, but we think that Lisa Nelson would be lucky to be taken seriously by Cudahy.
For more information, visit www.walmartwatch.com.
Eric Bull
Wal-Mart Watch
Ms. Nelson,
Your comments are not only clear and concise, but most welcome in a state whose business climate has consistently ranked in the bottom fifth of the Union.
Under Jim Doyle and the cumulative, weighty burden of 80 years of socialist dominance in state governance, Wisconsin ranks 44th in favorable business climate and 44th in favorable regulatory climate.1 These figures are simply no longer acceptable. Wisconsin now and for the past 10 years has fallen behind not only the national average for per capita income, but all of its neighbors as well.2
These trends should be setting off alarms and panic amongst our local and state elected officials (and our business leadership), but we can see through recent decisions that they remain either delusionally comfortable with the status quo or completely oblivious to the ominous economic disaster awaiting Wisconsin in the immediate future if a bold, new approach is not taken.
The old socialist models woven into this state's economic mentality must be tossed on the ash heap of history. They worked well when the state could extort virtually unlimited wealth from the old captains of industry. Those days are over in terms of unlimited private capital available for the state to pilfer and redistribute to pet interest groups. It is admittedly hard to move past an artificially created, unsustainably inflated standard of living/quality of life, but we must face harsh realities; this state and its people must prepare to sacrifice, get lean and efficient, and recreate an abbreviated spending list based on a sustainable economic reality that respects private wealth creation and rejects confiscatory policies aimed at that wealth. We must, at the same time, put an end to nonsense. When a small, but very vocal minority (with help from national fringe organizations) can consistently derail what should be very welcome development and expansion of the business and tax base in local communities, we very much need common sense to speak up and prevail, especially in light of the economic reality alluded to above. Wal-Mart in Cudahy is a perfect example. A Wal-Mart super center employees hundreds of people; it provides competitive pricing and product selection benefiting middle and working class families; and it constructs large, aesthetically pleasing, value-added developments contributing significantly to the local tax base. And, in this instance, Wal-Mart is proposing to step in and provide all these positives where otherwise the public would be left holding the bag on considerable debt with a significant missed opportunity and perhaps a TIF district in serious trouble.
To those who oppose – hey, don't shop at Wal-Mart. In a free country, we let the market place decide which business models succeed and which fail, not self-important government officials who failed Economics 101 or vocal minorities who have nothing productive to do with their time.
Godspeed Wal-Mart in Cudahy, and everywhere else in this state where it makes sense to locate a new super center! In time we may be able to persuade the national business and development community that Wisconsinites have come to their senses and are ready, willing and able to accommodate wealth creation and job growth in this state once again.
Thanks again, Lisa, and good luck in Cudahy.
1 Sources: Moody's Economy.com; Pollina Corporate Real Estate; Pacific Research Institute; Tax Foundation; CFED, Sperling's Best Places.
2 Source: Tax Foundation's State Business Tax Climate Index, available at
http://www.taxfoundation.org/publications/show/22658.html.
It's nice that Wal-Mart is dispatching public affairs people from their National Headquarters to spin their side of the Cudahy discussion but let's be practical here.
-Wal-Mart does pay taxes although you can argue they offset much of that when they offer subpar and overpriced health benefits and force most of their already well underpaid workforce to use BadgerCare.
-Wal-Mart does bring jobs to the area, although that is probably offset by the number of jobs that are lost when numerous competitors are shut down. Due to Wal-Mart's ability to strongarm vendors and force them to take their production overseas (more lost American jobs) they can offer low prices... even if it means you're now buying from China or some other country with no worker pay or health standards.
Those prices, while only slightly lower than competitors drive hardware, grocery, toy and other department stores out of business. The net effect is less jobs and more people that have to take Wal-Mart jobs where they are usually making less money and thus creating a greater tax burden on the state because of less revenue collected from taxpayers who now make less.
-Wal-Mart will be filling an empty lot that Cudahy has failed to develop, however they will be creating many more empty lots from other stores and big box stores going out of business and creating an even greater problem for the city in trying to fill those buildings or having to deal with redevelopment or zoning issues in the future.
One only needs to look at Oshkosh. Wal-Mart existed in a shopping center from 1990 until 2002. Once they added a Supercenter they moved to another location. In doing so, they maintained the lease on the property and would not allow competitors like Best Buy to look at the property so they passed and built in Fond Du Lac instead. Slowly the entire shopping center died off because of the big empty void there. Almost all of the stores left. In turn, the SuperCenter ended up killing grocery stores in the area as well. The nearby Copps Grocery Store announced last month it was closing it doors after being open over 25 years. The Piggly Wiggly on that side of town closed as well. Rex Electronics closed it's large store over there last year, after having to compete with a larger Wal-Mart electronics department.
In other towns Wal-Mart has practically killed all other commerce in the area as small businesses and other big boxes alike faced an insurmountable challenge thanks to Wal-Mart's unprecedented stronghold on vendors and complete lack of ethics in not caring about where the products are made nor the conditions they are made in co-opted with their own lack of reasonable pay and affordable benefits for their American employees.
Cudahy would do itself a favor by following the lead of Chicago and other cities across the country and voting against allowing a corporation that works parasitically to consume all of the shoppers in an area while eating all of their competition and my times integral components of a community in their quest for dominance.
So much for choice. If Cudahy taxpayers and its socialist mayor are dumb enough to want no real estate tax money on their vacant eyesore- so be it. That is the price of stupidity. Iceport incidentally happened because Cudahy government helped fund it, when they should have known the deal was risky because it could not get financing through regular market sources.
Regarding Wal-Mart itself- they have helped consumers throughout the country by making everything they sell more affordable. The anti-Wal-Mart clan is a group of bitter leftists that want to tell us where to shop and what to shop for- only union-made goods at places sold by union employees. If they had their way we would all be driving Vegas and Mavericks to the A&P.
Its still a free country and if Wal-Mart doesn't end up in Cudahy they will find a another site, and the customers will follow.
Are there people that believe Walmart is an evil corporation that kills communities off like meek lambs to slaughter. Has our education system truly sunk so low that we are turning out this mentality of forever helpless to do what we feel is right with our dollars? Really?
Walmart is successful because people shop there. Period. If you do not like the store; don't shop there. If they leave because no one shops, YMCA can buy the building and set up shop or someone else.
Really? Open a Walmart and Cudahy will float off into Lake Michigan? All the residents will move to St Francis? Must we continue to embarrass ourselves is a more pertinent question to ask.
Incredible. Wal-Mart is an asset to any town? History will show that Wal-Mart is a corporate leech and represents everything that is WRONG about America. It thrives on corporate welfare. Guess who pays for the health care of Wal-Mart's employees? The rest of us!!!!!!!
It's a shame that the people that post on here to defend Wal-Mart refuse to have an honest dialogue about the situation and refer to calling people opposed to the idea "socialists" or "bitter leftists that want to tell us where to shop and what to shop for- only union-made goods at places sold by union employees".
It's been proven in town after town that Wal-Marts do hurt communities. Competition is not a bad thing but free market economics is weighted towards those with more political influence and few corporations in the world have the influence that Wal-Mart does.
When a Wal-Mart opens up, sure you can make a case that they bring an instant influx of jobs and tax dollars to an otherwise unoccupied location. But use logic and you see that there is a seriously damaging expense to achieve this.
When other businesses are forced out of business you're only putting more workers out of work and putting more of a burden on the taxpayers in a community. Because there are less taxes collected, communities have to levy new taxes or fees in order to make up the lost share. The result is less in your pocket.
I would venture to say that when more people are out of work it hurts the pro-free market capitalists in the community just as much as it hurts those out of work in a roundabout way because of the amount of the tax burden they now have to pick up. Remember, these burdens are not picked up by corporations, who in most cases receive large breaks to get into a community.
In Wal-Mart's case they not only pass the buck by expanding unemployment rolls but they pass the buck by asking their workers to go onto government healthcare rolls like Medical Assistance or Badgercare. Other states have actually sued them for doing this.
When there are more people requiring Government Health Care, that means you, the free-market capitalist need to spend more of your tax money to cover the assistance these people now need and deserve.
And for the lots that will be vacated by those other stores going out of business... is Wal-Mart going to build a Wal-Mart in the location of that old Hardware store? Are they going to also build in the location of that Toy Store or Grocery Store that went out of business? Nope.
Unlike what Bob Johnson's post suggests the YMCA or some other business will not open up a store in the dead space left behind by one of Wal-Mart's victims. It's proven that these locations stay vacant and become a burden for the community leaders who cannot find anyone to develop the properties. Wauwautosa actually set up fees for big box stores that come into a community that pay for the property to be razed when there are no buyers for it. This is a direct response to the vacant unfilled lots left in Wal-Mart's wake (read the article on that here: http://www.jsonline.com/story/index.aspx?id=752033)
If people were willing to be honest about capitalism they would see that there are flaws in the system rather than railing against people that point such flaws our and become the evil boogeymen (unions, "socialists" or "leftists" as they call them) to declare the enemy of the American market system.
The main flaw is that free market capitalism encourages greed and without fair government regulation (all but eliminated today) consumers, workers, citizens and tax bases are set up to be ripped off.
The irony of the argument for Wal-Mart is that we should be encouraging more business to come to Cudahy. The problem is some are incredibly disingenuous when they refuse to talk specifically about how bringing in one business could kill four or five and then you've netted -4 or -5 businesses just for the one you brought in.
People say that it is up to the people to decide where to shop and this is true, but they also elected officials whom they knew were in charge of zoning and any TIF funds that might need to be allocated. If those elected officials vote down Wal-Mart then it will be the voice of the shoppers that was heard, regardless of how free-marketeers despise free thought and a working-for-their-constituents, efficient government.
Bad news for the socialists- Cudahy came to its senses and Wal-Mart has tentative approval to build. It must have been about the governmental greed for more tax money.
I stand by my comments about the anti-Wal-Mart crowd. Here is the definition of socialism- a theory or system of social organization that advocates the vesting of the ownership and control of the means of production and distribution, of capital, land, etc., in the community as a whole. Yeah, I'm a capitalist (this is the Small Business Times after all), please be honest and admit what you are.
As to Robert Poole's comment about the fallout from Wal-Mart- by his logic we would not be able to buy anything from other than the big three automakers, otherwise we are displacing jobs by buying Toyotas and Hondas. Nothing in his world would improve because we would be protecting his sacred cows at the cost of innovation, cost savings, and choice.
As to the free market capitalism encouraging greed, well your socialist ideals instill sloth and indifference. I haven't heard of many medical or technological breakthroughs coming out of the old USSR or Cuba.
Finally, who made the anti-Wal-Mart crowd the arbiter of where we shop and what we shop for? Who chooses who the arbiters are? A committee, government employees, politicians? That would be the definition of socialism.
Bill Marsh proves my point by going back to the name calling and labeling.
First, the USSR and Cuba were COMMUNIST. That means they were under authoritarian control. To confuse this as pure socialism is a right wing lie at best. There are socialist countries (see: Sweden) that are far from Communist.
Second the Automaker analogy is a false one. The Japanese Automakers make many of their vehicles right here in the United States and Toyota has been a better employer than any of the big three as of late. When the Japanese workers make cars they have the benefit of fair wages and health/environmental regulations that places like China do not implement to protect their workers. Your analogy is obviously set up to lie to people who do not know the difference.
3. Nobody is inhibiting your choice to shop at Wal-Mart but Governments decide zoning and permits and if a community decides against allowing a business to move in, they bring their protest to their elected officials who are supposed to act on behalf of them. That is not socialism that is REPRESENTATIVE DEMOCRACY. Unfortunately too many Bill Marshes exist out there because they don't seem to understand the definition of the word not the concepts in which our republic was founded upon.
BTW all these free trader, pro-corporate welfare commenters can take heart that it was them and their zeal for deregulating industry that is putting the economy in the tank. From Enron to the Mortgage Crisis all the way to the incredible outsourcing of jobs made easier due to free trade agreements the American public has taken a pounding from hardcore pro-corporation greed mongers.
And of course their response to make things better? Cut social programs for poor and middle class people that need it most when their jobs and homes are being taken away and cut taxes only for the rich so that the poor and middle class have to make up the tax burden created by letting rich people off scott free and by letting corporations dodge their tax burdens all the while Republicans run up greater debt than anytime in history.
Sounds like these guys really know what they're doing with the economy... Oh wait.. they don't.
Sorry to come back to this blog so late. Rain issues. Robert, I strongly encourage you to do more research. Many of the communities that Wal-Mart has left did not have new tenants for old Wal-Mart buildings due to decline in the community and/or zoning difficulties. Decline not caused by Wal-Mart but changes in the communities themselves. Indeed Wal-Marts have brought back many communities due to the symbiotic businesses that grow around anchored commercial districts.
For example, Wal-Mart closed a building in Mukwonago not long ago to move to a Super Center in Mukwonago, not far from their old site. The building is now leased fully to two tenants. Growing communities attract good business.
I will not say that Wal-Mart is an angel business. They have all the strengths and flaws of any large corporation. No more or less. If they did not fill a nitch, they would disappear like Treasure Islands (that's going back a ways) and Gimbels.
As to union versus nonunion. Very few department stores, if any, are union. Should we stop shopping at Kohl's or Target or Boston Store? Unions are falling out of favor with grocery chains as well.
I hope this helps. Letting the market decide is not always ideal but almost always the best method for deciding who comes and goes. In your own admission, regulations can be set in place to elivate future concerns.
People in America need to realize jus what got America in this shape..."cheap" yes so-call cheap items from a foreign land.
quote*Wal-Mart firmly believes in local procurement. We recognize that by purchasing quality products, we can generate more job opportunities, support local manufacturing and boost economic development. Over 95% of the merchandise in our stores in China is sourced locally. We have established partnerships with nearly 20,000 suppliers in China. *end quote!
Now! if there be 182 country's making items for the world to buy and they have only 5% of the pie in China...duh! This company makes the nice people of China support their currency(yuan) by keeping it in their country working for the people there.... but with the "yuan" going up in value and the US dollar going down...all the foreign items that the American consumer buys thinking it is cheap has went up in price.
People...its all about the currency and to keep a currency strong you got to keep it floating around the country you live in so it can work for you. For the past 12 years all them US dollars are being shipped overseas to a foreign bank and with the American worker not making anything for the foreigner to buy the "we the people" have to turn to the "second" largest employer in America(Uncle Sam) to sell "we the people" debt in order to get all them dollars back!
50 years ago a foreigner would had given their left nut for a US dollar or a Hershey's chocolate bar and today the same foreigner has got Uncle Sam and the American consumer by both all the while Hershey is moving the chocolate factory to Mexico. Wake up! America and think "MADE IN AMERICA."