Davis Is Caught in the Middle as Legislation Awaits His Signature

As Gov. Gray Davis wades into hundreds of measures passed in the final days of the 1999 legislative session, the “big box” bill weighs about as heavy as it gets for a centrist Democrat determined to steer the middle course.

If he signs it, the governor will delight his friends in organized labor and the biggest supermarket chains in California. If he vetoes it, Davis will bring joy to the executives of Costco and Wal-Mart, two titans of the discount retail warehouse business.

Davis, who promised to govern from the middle, finds himself squarely on the spot between divided constituencies, not only on the big box bill but also on many others.

Among them are bills requiring the Highway Patrol and local police to compile racial and ethnic data on motorists they stop, and open to development a “doughnut hole” of prime land in San Bernardino County.

The controversial big box bill, written and rushed through the Democratic Legislature without normal public hearings, would drastically curb, if not prohibit, Wal-Mart and Costco from inserting new, even larger stores into the mega-billion-dollar California grocery business.

Davis has not said what action he will take on the bill (AB 84) by Assemblyman Richard Floyd (D-Wilmington), a longtime ally of labor. But press secretary Michael Bustamante said Friday that Davis believes “policy issues should have the opportunity to be discussed and deliberated.”

The bill would prohibit local and state government agencies from approving retail big box stores larger than 100,000 square feet, if 15,000 square feet is used for the sale of nontaxable groceries or prescription medications.

Key supporters include an organization known as the Joint Labor Management Committee of the Retail Food Industry. Its members include Ralphs, Food 4 Less, Stater Brothers, Safeway, Vons, Pavilions and the United Food and Commercial Workers union, which represents grocery store employees.

Davis received hefty backing from organized labor in his campaign last year. Since taking office, he has sought to broaden his support in the business community, promising to do his best to protect the surging California economy.

Wal-Mart, the nonunion, Arkansas-based pioneer of warehouse retailers, operates 110 general merchandise warehouses and 24 Sam’s Club grocery outlets in California. Costco, of Washington state, operates 88 stores in California.

Stung by passage of the bill, the two retailers have mounted an aggressive campaign aimed at persuading Davis to veto the bill, including full-page ads in newspapers and “consumer education” tables at stores.

Proponents of the bill claim that extraordinary action at the state level is necessary to block the “predatory” practices of the big box industry against existing grocery stores. They assert that warehouse retailers in search of new locations pit one income-hungry city against another in bidding wars with promises of higher tax revenues and jobs. In exchange, they demand special zoning and tax concessions, critics contend.

“Once approved, they then convert or attempt to convert a substantial amount of floor space to nontaxable retail,” said Leslie Goodman, spokeswoman for the labor-supermarket committee. “They will suck the lifeblood out of communities.”

Les Copeland, Wal-Mart’s director of communications, and Sheri Flies, corporate counsel for Costco, called the Floyd bill a “dead of night” assault by the Legislature and a runaround of local government regulators that would backfire for consumers.

“Where competition is limited, consumers will be forced to pay more for their groceries,” Copeland said.

Davis also has been put on the spot by another bill involving an isolated piece of prime property in the city of Redlands. Like the big box issue, the League of California Cities cites the bill (AB 1553) by Assemblyman Thomas Calderon (D-Montebello) as an example of “special interest arm-twisting that undermines public confidence in the Legislature.”

The Calderon measure would effectively strip Redlands of planning authority over 1,000 acres where the owners want to develop commercial and industrial buildings. The so-called “doughnut hole” site is surrounded by the city, but is actually in San Bernardino County.

Supporters of the bill want to give the county planning authority over the land, figuring it would be easier to win approval of county supervisors. The landowners include a firm partly owned by Los Angeles developer Ed Roski Jr., which wants to develop a shopping center on the acreage.

Assemblyman Brett Granlund (R-Yucaipa), a backer of the bill, says the “absolute meat of the issue is that you have the city of Redlands that is tremendously no-growth.”

Davis also finds himself at the center of a bill (SB 78) by Sen. Kevin Murray (D-Culver City) that potentially pits two constituencies against each other--law enforcement and minority community leaders.

The bill would require the California Highway Patrol and police in major cities to collect data on the race and ethnicity of motorists pulled over in traffic stops.

Murray said anecdotal evidence suggests that minorities are stopped in numbers greatly disproportionate to their presence in the driving population.

Citing legislative estimates that the multiyear project could cost more than $8 million a year, some law enforcement departments have objected to the price tag as well as to the time it would take to gather the information.