LISSA’S: Wal-Mart Profits from Taxpayers

When Wal-Mart comes to town, consumers often pay more than they save. Not only does Wal-Mart ask taxpayers to subsidize the building of its giant retail stores, Wal-Mart pays its workers so little they regularly are forced to use emergency rooms and public services—at taxpayer expense.

First, the company usually asks for massive public tax subsidies and exemptions to build one of its big-box stores. Over the past 20 years, taxpayers have contributed at least $1 billion in subsidies to Wal-Mart stores and distribution centers, as well as to developers of shopping centers anchored by Wal-Mart stores, according to Good Jobs First, a nonprofit research group.
A 2001 study commissioned by the city of Barnstable, Mass., found big-box retailers such as Wal-Mart annually depleted the town's revenues by $794 per 1,000 square feet due to higher road maintenance costs and greater demand for public safety services.

Elected officials in Cathedral City, Calif., gave Wal-Mart $1.8 million in tax rebates 10 years ago. Last year, when the city finally began getting its full $800,000 in annual sales taxes from the two stores, Wal-Mart decided to close them in 2005 and build a new supercenter in nearby Palm Desert. Cathedral City officials learned Wal-Mart was moving out after reading about it in the newspaper—at a time when the city already had a $3 million deficit.

Next, Wal-Mart makes taxpayers pick up the health care tab for its employees. While 66 percent of workers at large U.S. firms get health coverage on the job, fewer than half of Wal-Mart workers do, an October 2003 AFL-CIO report finds. As a result, Wal-Mart workers are forced to use emergency rooms and public services for their health care needs.

The average Wal-Mart costs taxpayers an estimated $108,000 a year for its workers' children who are enrolled in state children's health insurance programs, according to Everyday Low Wages: The Hidden Price We All Pay for Wal-Mart.

California taxpayers pay $86 million annually for such public programs as health care and subsidized housing that low-wage Wal-Mart workers rely on, according to an August 2004 report from the Institute for Labor and Employment at the University of California, Berkeley.
A growing list of states—Arkansas, Georgia, Tennessee, Washington, Massachusetts, Wisconsin, West Virginia and Connecticut—report Wal-Mart as the 1 beneficiary or among the top corporate beneficiaries of its public health program for children's health care. Currently, 12 states have introduced legislation to require states to disclose which employers are shifting health care costs to taxpayers and another 27 have, or plan to introduce, such legislation. Championed by members of the National Labor Caucus of State Legislators, the legislation is designed to help measure the costs to state health care programs when large and profitable employers such as Wal-Mart skimp on coverage.

Wal-Mart has a health plan. But because few workers can afford it on the wages Wal-Mart pays, the company instead encourages its workers to apply for public assistance.

Recognizing the huge costs taxpayers bear when Wal-Mart moves into an area, communities have begun standing up to the giant retailer. In Franklin, Wis., a coalition of union, consumer and environmental activists in July 2004 won passage of a size ordinance covering retail stores that stopped development of a proposed 184,000-square-foot Wal-Mart supercenter selling groceries as well as other goods. In Los Angeles, activists won passage of a city ordinance in August 2004 requiring retailers such as Wal-Mart to pay for economic analyses showing whether proposed supercenters would eliminate community jobs, depress wages or harm neighborhood businesses.

"They are not good neighbors. Their low-wage jobs have no health care," says Cathedral City Mayor Pro Tem Greg Pettis. He advises other local leaders letting Wal-Marts in their community is "the biggest mistake" they can make with public money.

source aflcio.org