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On the living wage bill, 'people have no idea how damaging this is'

Friday - 7/12/2013, 2:49pm  ET

Following his appearance before the D.C. Council Friday, Deputy Mayor Victor Hoskins and I chatted in more depth about what the living wage bill means for the District's economy.

Even if Mayor Vincent Gray vetoes the bill, as is likely at this point, the District's reputation with the business community is seriously damaged, Hoskins said. Not irreperably, necessarily, but damaged nonetheless.

For example, Hoskins noted during the committee hearing that three retailers, not Wal-Mart, have told him they are "not interested in looking at the District right now." They were before, he said, and now, even if the bill dies, they are not. Could it be Lowe's? Wegmans? He won't say.

Even Wal-Mart, Hoskins said, is not guaranteed to build at Skyland Shopping Center, at Capitol Gateway or on New York Avenue NE if Gray successfully kills the legislation. They may still come back, Hoskins said, but like fixing a damaged relationship, "We're going to have to work for this trust."

"They had removed from their head the barrier that D.C. was a bad place to do business," the deputy mayor said of the retail community. "Then, all of a sudden you get this dash of cold water. It has a chilling effect."

Over the last two-and-a-half years, Hoskins said, the District has "repositioned ourselves." Retailers, he said, want "to meet with us," where just a couple years ago, they avoided even the discussion.

But the city still lacks strong retail "gravity centers" that draw in outside customers and high-end businesses, Hoskins said, and it is very susceptible to competition from neighboring jurisdictions.

The D.C. economy may be strong, he said, but its retail position is not. And it may get weaker over the next several years if the living wage bill is enacted, because existing retailers such as Macy's, Neiman Marcus, Target, Lord & Taylor and Home Depot may decide to leave.

"They have a really important decision to make," Hoskins said. "People have no idea how damaging this is."

© 2013 American City Business Journals, Inc.