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Independent businesses say big box study flawed

Thursday, October 7, 2004 by

Flawed analysis led to inadequate policy, says group

The Austin Independent Business Alliance wants the city to adopt new rules regulating big box retail stores. That's one of several recommendations contained in a report on the study commissioned by the city analyzing the economic impact of big box stores. According to the team assembled by the small business group, the city’s study, "Big Box Retail and Austin,” is seriously flawed. The subsequent City Council policy decisions based on that information, the group argues, are surely flawed as well.

The 32-page analysis of the study by economist John Hockenyos takes exception to the data, the assumptions, and the conclusions of the report. The analysis was performed by Dan Houston with Civic Economics, Michael Oden with the UT School of Architecture, and former Council Member Bill Spelman with the LBJ School of Public Affairs at UT. They say the original report contained an exceptionally narrow definition of big box, leaving out several large national retailers. This, in turn, impacts the final calculations about the total market share of big box stores.

"It doesn't even meet the basic common sense test," said LivebaleCity Board Chair Robin Rather. "For example, the study concluded that big box poses no threat to local independent businesses. That's ludicrous." The Hockenyos study did conclude that local retailers, while unable to compete with the low prices offered by chain stores on specific items, frequently found ways to attract customers by offering specialty items or additional services.

The authors of the review argue that establishing design standards for big box stores, as advocated by Council Member Brewster McCracken, will not be sufficient to achieve the desired results. They call for requiring large-scale retail developments to obtain a Conditional Use Permit. That permit, said Spelman, should be dependent upon the results of an economic impact study for each new big box store. "If a big corporation decides to put a store in town and they're not paying their people a living wage…and they're not paying their people health benefits, we know in advance their employees are going to be putting a strain on the city budget for affordable housing, for child care, for public health care," he said. "I think it only makes sense to identify how big that gap is in advance."

Rather was even more critical of the employment practices of certain big box retailers. "Some of these chain retailers are costing you a fortune by not paying their employees enough and then sticking the public with the tab for their wages and health care," she said. "We're asking that these billion dollar retailers carry their own weight. We want the city to ensure that the big box developments add more in tax base than they subtract in tax burdens."

The new report concludes that big box stores can actually be a drain on the city's finances, despite the sales tax and property tax revenues that they generate. That's because the stores strain the city's infrastructure and create additional demands for police, fire, and EMS services, according to Oden. "Other studies presented in our evaluation suggest that big box developments generate higher costs in all of these areas on a square-foot basis. Studies, for instance, have found that the high traffic and zero tolerance policies toward shoplifting generate very high police service costs for large national chain retailers," he said. "We think it's important for the city to require big box retailers to evaluate and address these costs."

Under the Conditional Use Permit proposal, only large-scale national retailers would be required to provide an impact study. Smaller businesses, local businesses, and other low-wage employers would not face the same requirement.

"The biggest reason is studies cost money," said Spelman. But he argued that large national retailers could easily afford to assemble the information required. "We're not talking about years of study here. We're talking about a few weeks of someone in the corporate office who knows very well the standards the corporation is adhering to. They know their wages. They know their benefits. They know how often their people have to go to the doctor. We're not talking about a lot of work here."

County to beef up environmental enforcement

Budget funds five new enforcement positions

Travis County Commissioners are looking to clean up their act — and they are ready to spend a chunk of money to make it happen. Precinct 1 Commissioner Ron Davis, along with other county officials, will announce a new initiative today designed to expand the county’s criminal and civil environmental enforcement services. Officials will outline the program at 10:30 this morning, using an illegal dump site off of Johnny Morris Road as a backdrop.

“As Travis County continues to urbanize and grow in population, the demand for environmental regulation increases,” Davis said in a statement. “The Commissioner’s Court has struggled to address the community’s concerns in these areas and concluded a significant lack of resources currently hinders the county’s ability to adequately enforce existing regulations, and take on new responsibilities.”

Commissioners approved $368,537 in the 2005 budget to finance five new positions, three in the County Attorney’s office and two in the county’s Natural Resources Program. The new positions will be used to enforce federal, state and local environmental regulations.

County officials have targeted four major enforcement areas:

Air Quality – Staff will provide field enforcement and support to satisfy the requirements of the Early Action Compact and the State Implementation Plan as they affect Travis County. Staff will also be charged with compliance with and enforcement of odor regulations at solid waste dumps.

Water quality – Staff will provide primary inspection and follow up on unlawful discharges to waters of the state and support of the Texas Pollution Discharge Elimination System program. Staff will monitor industrial and construction sites, and will provide septic inspections.

Solid Waste – Program staff duties will include state permit enforcement of solid waste facilities, including landfills, sludge application sites, and compost facilities. Special emphasis will be placed on prosecuting illegal dumpers.

Texas Commission on Environmental Quality Permitting, Monitoring and Follow-up – County staff will provide more systematic and thorough review of state actions that affect Travis County.

In case of rain, the announcement will be moved to the Precinct One Satellite Office at 9301 Johnny Morris Road.

Austin Energy honored . . . Austin Energy, the city's electric utility, has won the Green Power Program of the Year award at the fourth annual Green Power Leadership Awards conference. The federal Environmental Protection Agency, the U.S. Department of Energy and the Center for Resource Solutions hosted the conference. The utility was recognized, in part, because Austin Energy led the country in sales of renewable energy for the second year in a row – providing 300 businesses and more than 7,000 residential customers with electricity through the Green Choice program . . . Historic ordinance hearing postponed . . . A hearing on proposed amendments to the city’s ordinance governing designation of and tax abatements for historic structures that was scheduled for last night has been postponed to next Tuesday. Historic Preservation Task Force Chair Betty Baker told In Fact Daily that the hearing was postponed because of improper posting . . . Chamber names PR director . . . The Greater Austin Chamber has named Amanda Lawson Director of Public Relations. The name should be a familiar one, since Lawson has spent the last four years as a reporter for KVUE-TV.. . . City Council today . . . This week's agenda is fairly light compared to what the Council has faced in recent weeks. Austin Energy will be seeking authorization to fund $1 million worth of the educational and recreational opportunities for children as well as neighborhood improvements for the Holly Street neighborhood. Austin Chronicle reporter Mike Clark- Madison is seeking an appointment as Austin's representative to the Central Texas Library System. The purpose of the group is to strengthen public library services and increase access to information. The Council will also be asked to authorize a $125,000 professional services agreement with Colette Holt and Associates in Chicago. Holt is expected to assist the city in conducting a series of studies relating to minority and women-owned businesses . . . Zoning cases . . . The Council will once again consider four cases within the West University area of the C entral Austin Combined Neighborhood Plan. Representatives of developers and neighborhoods have been working to resolve some difficult issues on these properties this week. The Council will not be considering eight zoning cases in the Rainey Street neighborhood which will likely be postponed for two or three weeks . . . The Council is scheduled to hold three public hearings at 6pm. Irma Arrieta is appealing a decision by the Zoning and Platting Commission to deny a Conditional Use Permit for day care services on West William Cannon. The ZAP had initially granted the permit but after hearing from a citizen who signed up but did not get to speak, the commission decided to reconsider the matter. After hearing from concerned neighbors, the commission voted unanimously not to grant the permit. Consultant Jim Bennett is representing the applicant, who wants to expand her current day care business and add a circular driveway . . . Susana Almanza and Sylvia Herrera of PODER are objecting to administrative waivers and Planning Commission approval for a new parking lot for Austin Community College. The 370 parking spaces will serve ACC’s Eastview campus at 3401 Webberville Road. Melton West is once again on the agenda asking the Council to overturn a Planning Commission decision to deny a compatibility height waiver for his West Sixth Street condo. West and a neighbor have been discussing possible sale of the condo to the neighbor. If the two have reached agreement, there will be no need for the Council to make a decision. The public hearing on this matter was held and closed on June 17 . . . There are also 11 routine annexation hearings, which should be brief . . . Looking for more debate action? . . If neither President George Bush nor challenger John Kerry suits you, you might be interested in today's debate at the University of Texas. Libertarian Party presidential candidate Michael Badnarik and Green Party candidate David Cobb will debate the issues beginning at 1130am on the West Mall, between the Main building and Guadalupe St. The Chicano Culture room on the fourth floor of the Texas Student Union building has been reserved for post-debate interviews or for the debate itself in case of bad weather . . . Left out . . . A story about a forum for local legislative candidates which ran yesterday listed the names of several sponsoring organizations. But the name of one sponsor, Education Austin, did not make it into the article. In Fact Daily regrets the error. The teachers' union has endorsed Democrats Mark Strama for Representative District 50 and Kelly White for Representative District 48.

Copyright 2004 In Fact Daily

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