DC Mayor Vince Gray issued his anticipated veto today of a bill that would require many of the city's largest retail stores to pay their workers a "living wage" of more than 50 percent above the minimum wage. The bill, formally titled the Large Retailer Accountability Act, was introduced earlier this year as Walmart started building the first of its six planned stores in the District, and was seen as more targeted against the world's largest retailer more than any other company.
In vetoing the measure, Gray sets up a final showdown next week when the DC Council gets back from its summer recess. Council chairman Phil Mendelson's office says he will schedule an override vote for next Tuesday. Before breaking in July, the Council passed the wage bill on an 8-5 vote. An override would need only one more supporter.
“I am vetoing this legislation precisely because I believe in providing a living wage to as many District residents as possible—and this bill is not a true living-wage measure,” Gray said in a press release. "While the intentions of its supporters were good, this bill is simply a woefully inadequate and flawed vehicle for achieving the goal we all share.”
As written, the bill requires an hourly wage of at least $12.50 at stores at least 75,000 square feet large and operated by companies that gross at least $1 billion in annual revenue. (Stores where workers have collective bargaining agreements, such as Giant and Safeway supermarkets, would be exempt.) The District's minimum wage is $8.25 an hour.
Walmart balked at the bill, and upon the legislation's passage said it would cancel its plans on three DC locations at which construction has not yet started. The company also waged a heavy publicity campaign in the two months since the Council voted, inundating reporters with emails about why Gray should strike down the bill. Not surprisingly, Walmart is quite pleased with the mayor's decision.
"Mayor Gray has chosen jobs, economic development and common sense over special interests—and that’s good news for D.C. residents," Walmart spokesman Steven Restivo writes in an email. "Now that this discriminatory legislation is behind us, we will move forward on our first stores in our nation’s capital."
In a letter to Mendelson accompanying the veto, Gray writes that the large retailer bill could have cost the District as many as 4,000 jobs, and that the brunt of the effect would be felt most deeply in wards 5, 7, and 8, where unemployment is at its highest.
"At a time when the District's economy is starting to feel the impact of federal budget cuts, when we are seeing significant public-sector job losses, when our once-falling unemployment rate has stalled well above the national average ... the District cannot make a reasonable, responsible, or moral case that we don't need the jobs these retailers would bring," Gray writes.
The bill's passage also prompted reaction from other companies, including Macy's and Target, which said they would reconsider expanding their footprints if the large retailer bill became law.
Backers of the legislation are disappointed in the mayor's decision.
“The Mayor’s office and Walmart have been working together to defeat this bill from the start," the Rev. Graylan Hagler, a pastor who has been leading the bill's supporters, said in a statement released by the activist group Respect DC. “If we cannot demand higher wages and good jobs from the nation’s and world’s largest corporations DC will not be able to remain a diverse and vibrant city." During a recent rally in support of the legislation, Hagler referred to Bentonville, Arkansas-based Walmart as an "ittle bitty cracker corporation."
But even if the original count stands and Gray's veto is not overridden, the debate over how much DC businesses should pay their hourly employees might not be over. In his letter to Mendelson, Gray writes that he is interested in raising the minimum wage for all workers.
"The bill is not a true living-wage bill, because it would raise the minimum wage only for a small fraction of the District's workforce," Gray writes. "Instead of these arbitrary and partial attempts at insisting on living wages for only certain workers and certain sectors, I propose that we raise the minimum wage for all District residents—regardless of who employs them, when their employer begins operating in the District, or whether or not their jobs are unionized."
Restivo, the Walmart spokesman, did not return requests for comment on Gray's proposal.