Vince Gray Vetoed the “Living Wage” Bill. What Now?

What the mayor's decision means for Walmart's future in DC, and why there's almost no chance the DC Council will override the veto.

By: Benjamin Freed

Earlier today, DC Mayor Vince Gray vetoed the Large Retailer Accountability Act, a bill that would have required certain big-box stores—i.e., Walmart—to pay their workers starting wages of more than 50 percent above the District's standard minimum wage. While the activists who backed the bill are disappointed with the mayor and are hoping the DC Council overrides the veto, Walmart is quite pleased with the development.

However, just because the so-called "living wage" bill might be on the ropes doesn't mean a bunch of Walmarts are about to sprout up overnight. There are several factors still at play. Here are some answers to a some of the questions raised by Gray's veto.

It seemed like this bill had a lot of popular support. Why did the mayor veto it?

The large retailer act did have plenty of backers, but Gray was never going to be one of them. When Walmart first expressed interest in building its first stores in DC, it did not plan to open six. But Gray personally lobbied the company to settle on six locations, including the long delayed redevelopment of Skyland Town Center in Southeast, near his home. In November 2011, when plans for the stores were unveiled, Gray and Walmart announced that in addition to opening six stores throughout DC, the retailer would also make significant investments in local charities and public assistance programs. And in July, when the DC Council voted on the large retailer bill, Gray sent them a letter warning that it could have a "chilling effect" on development throughout the District.

When will the DC Council attempt to override the veto?

Next Tuesday. The Council approved the bill by an 8-5 tally back on July 10, then broke for its summer recess. Council Chairman Phil Mendelson, who has been one of its strongest supporters, says the attempt to defeat Gray's veto will happen early next week, when the Council gets back in session.

So, will the Council beat back the veto?

Almost certainly not. Overriding a mayoral veto requires a two-thirds majority of the Council, or nine members. Even though that means the wage bill's supporters only need to find one more vote, those that opposed it the first time out are sticking by their vote. Ward 4 Council member Muriel Bowser and Ward 6 Council member Tommy Wells, who are running in next year's mayoral election, are sticking by their opposition, aides to both say. (Both of their wards are also home to future Walmarts.) Same goes for Ward 3's Mary Cheh. Even though Walmart isn't building any stores in Cheh's Northwest DC turf, she remains opposed to a bill targeting certain big-box retailers.

Yvette Alexander, who represents Ward 7, where Walmart is planning to build two stores, was the wage bill's loudest opponent over the summer and put out a lengthy statement today urging her colleagues to sustain the veto.

That leaves David Catania as the other original "no" vote, and while his opposition was finicky—he might have supported the living wage bill if the rest of the Council had supported his school funding plan—the bill cannot be amended during the override process.

As for Walmart, the company spokesman's Steven Restivo says it's possible the override vote might even result in a few more "no" votes. "Given all the criticism the bill received nationally, it would only seem to make sense for some supporters to change their minds," he says.

And where does that leave Walmart?

Walmart already has three of its DC stores under construction—one on Capitol Hill, scheduled to open in late 2013 or the first quarter of 2014; one on upper Georgia Ave., NW, due to open early next year; and one near the Fort Totten Metro station, which will be completed in 2015.

The other three stores are still only at the blueprint stage. There's the Skyland location, which is very important to Gray; one at a planned mixed-use development at the Capitol Gateway complex in Northeast; and another in Northeast at a proposed development bounded by New York Ave. and Bladensburg Rd. However, that last site is was thrown into jeopardy last week when, independent of Walmart, the agreement between the location's owner and developer collapsed. Restivo says that whatever happens there, Walmart is still committed to opening.

Gray claimed that if he had signed the bill, it would have cost the District 4,000 jobs. Where is he getting that number?

We asked Gray's office, which deferred to Deputy Mayor for Planning and Economic Development Victor Hoskins. Hoskins' spokeswoman, Chandra Washington, sent over the following breakdown:
Some of this is a bit of a stretch. The jobs from the three Walmart stores currently under construction are about right, as is the number of jobs at stores that would neighbor them. But the fate of one of the three planned but unbuilt Walmarts is in doubt.

As for Walter Reed and St. Elizabeths, mentioning those locations seems to be more of a reminder of the statement issued by other large retailers after Walmart threatened to pull half its stores over the wage bill. Following Walmart's lead, six stores—Target, The Home Depot, AutoZone, Walgreens, Lowe's, and Macy's—said that if the bill became law, any plans to expand their footprints in DC would have to be "revisited."

But both Walter Reed and St. Elizabeths are a long way from being retail hubs anyway. The city sent out its request for proposals on Walter Reed to qualified developers earlier this year but has not yet made its selection. St. Elizabeths isn't even that far along in its redevelopment process.

Let's get back to the wages, though. With no Large Retailer Accountability Act, what is Walmart going to pay its workers?

That's really up to Walmart and the market, isn't it? Restivo, the Walmart spokesman, says the Bentonville, Arkansas-based company will offer competitive pay when it enters the District. "Our wages and our benefits meet or exceed what's offered by most companies in Washington, DC," he tells Washingtonian.

According to the Bureau of Labor Statistics, the mean hourly wage for a retail salesperson in DC is $13.86, more than a buck higher than the $12.50 level the Large Retailer Accountability Act would have implemented.

Is there any chance DC will raise its minimum wage?

Maybe! Right now, the minimum hourly wage in DC is $8.25 an hour, a full dollar higher than the federal rate, but still pretty lacking in a city where the cost of living continues to go up. But the living wage bill's strongest opponents, like Gray and Alexander, say they want to increase the minimum wage for all workers.

In a statement accompanying his veto, Gray proposed a minimum wage hike. And Wells, who voted against the bill and plans to do so again, is calling to raise it by one dollar a year over the next two years to $10.25.