GARDEN GROVE : Wage Dispute Stalls Shop Center Plans

A dispute over wages for construction workers has temporarily shelved plans for a 118,000-square-foot Smith Food & Drug Centers Inc. facility and affiliated businesses in Garden Grove.

The five City Council members, acting as the city’s Agency for Community Redevelopment, will try to work out terms and vote on the project on March 24.

The Utah-based company, which operates other stores in Orange County, would be located near Harbor and Garden Grove boulevards, near Mervyn’s department store.

It would pump about $250,000 in sales taxes and more than $100,000 in property taxes into the ailing Garden Grove economy each year, officials said. The “one-stop” center, which would include a food court, drugstore, photo-processing center, 10,000-square-foot video center and discount office supply business, also would provide about 350 jobs, officials said.

A hitch developed in plans after state trade union leaders called on Garden Grove officials to stand by their policy that all workers on redevelopment projects should be paid at the wage prevailing in the community if economically feasible, officials said.

Meeting behind closed doors, officials reportedly discussed whether to waive the prevailing-wage proviso or come up with the difference in construction costs, estimated between $300,000 and $600,000.

The Redevelopment Agency also intends to pay landowners $7 million for the land and sell it back to them for $5.1 million.

Mayor W.E. (Walt) Donovan said the city is making the deal to induce owners to put in the food and business center that he said will benefit residents and the city.

Also, previous plans for the property, which formerly contained a carwash and a recreational vehicle lot, would have been more costly to the city because of heavy relocation costs, he said.

Donovan said Smith Food has its own contractor in an effort to hold down building costs.