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Gray Veto Pleases Businesses, Inflames Others

Barrington M. Salmon | , James Wright | 9/18/2013, 8 a.m.
D.C. Mayor Vincent Gray’s veto could keep big-box stores like Target from raising the minimum wage. (Courtesy photo)

Mayor Vincent C. Gray (D) vetoed a living wage bill Thursday that would have required Big Box retailers in the District to pay their employees $12.50 an hour.

The bill, the Large Retailer Accountability Act (LRAA) which passed by an 8-5 vote in the D.C. Council earlier this summer, incensed Wal-Mart officials and elements of the business community, with the D.C. Chamber of Commerce being among the most vocal.

Gray, 70, estimates that as many as 4,000 jobs would be lost in the first few years if the bill had gone into effect.

Barbara Lang, the Chamber’s president and chief executive officer, anticipated the city thriving because of Wal-Mart's presence.

"This is a major victory for the residents of the District of Columbia and the business community," she said. "We're now in a position to be the economic hub for our region and end the retail leakage that has plagued this city too long."

Retail leakage refers to D.C. residents shopping for clothes, goods and services outside of the city. This problem has been bemoaned by Gray and Victor Hoskins, deputy mayor for economic development and planning, as the city loses sales tax revenue to neighboring jurisdictions.

The bill stipulated that retailers with $1 billion or more in sales, or with spaces of 75,000-square-feet or more, would have had to pay employees the $12.50 an hour in combined wages and benefits. Currently, the minimum wage for the District is $8.25 an hour. The higher amount would increase the annual earnings of a full-time worker from $17,000 to $26,000 annually, hardly enough for anyone to live in the District, The Rev. Graylan Scott Hagler and other critics have said.

Justin Danhof, the director of the National Center for Public Policy Research's Free Enterprise Project in Northeast, praised Gray's move.

"Today, Mayor Gray stood up for the workers and residents of his city," Danhof said. "Instead of having to consider traveling outside of the Beltway to purchase groceries, clothes and other necessities, D.C. residents can now shop right in their own backyards and be assisted by their friends and neighbors who have stable jobs that the District so desperately needs." 

Hagler, senior pastor of the Plymouth Congregational Church of Christ in Northwest, strenuously disagrees.

"Unfortunately, the mayor's decision is hardly surprising because this is exactly what Wal-Mart's lobbyists said would happen," said Hagler, 59. "The mayor's office and Wal-Mart have been working together to defeat this bill from the start. If we cannot demand higher wages and good jobs from the nation's and world's corporations, D.C. will not be able to remain a diverse and vibrant city. We strongly urge the city council to override this misguided veto." 

Prior to the vote, Wal-Mart threatened to halt plans to build three of six proposed stores in the city. It’s not clear if the council has the nine votes it needs to override Gray’s veto.

Gray, 70, said while he supports a living wage for D.C. residents, the LRAA is fundamentally flawed. He explained his rationale in a Sept. 12 letter hand-delivered to Council Chair Phil Mendelson.