A proposal to ease restrictions on "big-box" superstores in the city of Sacramento moved forward Tuesday and is now headed for what will likely be a politically charged debate before the City Council.
In a split decision, the council's Law and Legislation Committee voted to move a proposed repeal of the city's big-box ordinance to the full City Council. The committee voted to make no recommendation on the proposal, although city development officials have recommended easing the restrictions.
Councilmen Jay Schenirer and Allen Warren voted in support of forwarding the plan to the council for an August debate. Councilmen Steve Cohn and Darrell Fong opposed the motion, seeking to delay the matter until a similar law proposed at the Capitol is resolved.
Building-industry advocates have long sought to overturn an ordinance passed by the City Council in 2006 that requires complicated economic impact studies and wage analyses for proposed superstores larger than 90,000 square feet with more than 10 percent of space dedicated to groceries. Those advocates describe the ordinance as a de facto ban, noting that no superstores have been built within the city limits since the regulation was adopted.
In a staff report presented to the Law and Legislation Committee, city development officials said the restrictions are "ineffective because they place Sacramento at a competitive disadvantage with surrounding jurisdictions."
"The unintended consequence of the ordinance has been to push superstores to neighboring jurisdictions resulting in a leakage of sales tax revenue," officials wrote in the report. Staff members cited three Walmarts that have opened just outside city limits since June 2009.
The proposed change has upset influential labor leaders, who have been at odds with retail giant Wal-Mart for years over the wages and benefits it pays to its nonunion workforce. Competition from Wal-Mart and other nonunion stores also has been putting pressure on union grocers such as Safeway and Raley's.
Wal-Mart spokeswoman Delia Garcia said the chain has no plans to build additional stores in Sacramento.
Leaders of unions representing food workers and other labor groups asked the Law and Legislation Committee to delay taking action on the ordinance until the future of the proposed state law is decided.
Assembly Bill 667 by Assemblyman Roger Hernández, D-West Covina, would require economic impact studies for big-box stores proposed in former redevelopment zones and enterprise zones, or for projects receiving more than $100,000 in public subsidies. Gov. Jerry Brown vetoed a similar bill in 2011.
James Araby, executive director of the Western States Council of the United Food and Commercial Workers, said the city risked having "to redo a lot" if the state law is passed after the local big-box ordinance is repealed. He also voiced support for economic impact studies of big-box stores, asking, "Why would cities want to take away tools of analysis?"
Fong and Cohn agreed that the council vote should be delayed, but their motion was denied.
"I would like to not make a habit of waiting on the state for anything," Schenirer said, who added he expects the city to oppose AB 667.
Even if the ordinance is repealed, proposed big-box stores would still need conditional use permits issued by the planning commission.
"By repealing this ordinance, you make it so the city has the opportunity to look at these projects on a case-by-case process," said Joshua Wood, executive director of Region Builders, a building industry advocacy group.
Region Builders was joined in supporting the proposed changes by business groups, including the Sacramento Metro Chamber of Commerce.
Even as the new ordinance was explored at City Hall in recent months, some council members sought to distance themselves from the volatile issue by refusing to comment publicly on the changes. Schenirer acknowledged the sensitive nature of the debate Tuesday.
"This will be a political decision in some ways by the council," he said.