Editor’s note: The following is part three of a three-part investigation into Calvert County’s retail future
Prince Frederick, MD – In our first part in this series, we took a look at an outline of the proposed amendments which would affect New Town District. Big box stores are a uniquely American phenomenon — perhaps not so much in the concept of a big box store itself, but certainly in the way that these stores have been able to implant themselves in the American economy.
It’s hard to imagine a world where you can’t shop for groceries and garden supplies at the closest Wal-Mart, Costco, or Target store.
In our second installment, we took a more detailed look at the real effects of big box stores in the U.S. There have been many case studies and a great deal of research into how big box stores affect American communities — in terms of economic activity, but also in terms of cultural and social activity — and we sifted through several different studies.
Nearly every study — regardless of the location, demographic, or trend analyzed within — came to the same conclusion: Big box stores are bad for American economies.
In Calvert County, many residents and business owners have voiced similar sentiments. Introducing a piece of legislation that would allow a big home improvement store to move in will only hurt the local economy, and small business owners in particular. This sentiment has been expressed through previous news articles, on social media platforms, and in various town meetings.
But there is always another side to the story.
2011: The Beginning
Randy Barrett is a third generation resident of Calvert County and grew up in Huntingtown. He and John Gott Jr. are the principals of Bargo, LLC, a local business that focuses on commercial land development. In June 2015, the Calvert County Board of Commissioners voted unanimously to authorize the board president to sign an exclusive negotiating rights agreement (ENRA) with Bargo to develop the land located in the New Town District Planning Area.
Bargo’s active involvement in the Armory Square project began back in 2011, Mr. Barrett told The BayNet. Both he and Mr. Gott were excited to be involved in a commercial development project after the Calvert County Board of County Commissioners (BOCC) worked with Fore Consulting in 2011 to do an analysis on the buying power and economic activity of county residents.
There’s an Unfilled Demand for Retailers
The analysis, Retail Purchasing Power and Space Demand Analysis of Calvert County, Maryland, showed some pretty shocking results about how much economic activity was leaking out of Calvert County:
“Comparing the estimated total levels of retail expenditures by Calvert County residents ($1,044,457,700) with the estimated level of retail sales occurring within the county ($719,333,897) indicates that there is a net ‘loss’ of retail sales spending of approximately $325,124,000 to locations outside of Calvert County.”
Excluding food and beverage stores in the county, which have sales that “exceed the expenditures of county residents by a substantial margin,” the report found that Calvert County “loses” around $460 million in consumer spending each year.
The county has an “unmet demand for approximately 1.6 million square feet of retail space,” meaning that residents travel outside of the county to shop because there aren’t enough retail locations within the county to meet consumer demands.
These numbers also show that the county loses money through a lack of retail property taxes and through low employment numbers:
“If all the unmet demand for retail space were accommodated within Calvert County, an estimated additional $1.9 million in real property tax revenues might be realized… Using sales per paid employee data published by the International Council of Shopping Centers, it is estimated that approximately 2,553 retail jobs are “lost” to other jurisdictions.”
In summation, Barrett told The BayNet, Bargo became involved in the Armory Square project because the county is losing money when residents travel to neighboring towns to shop.
“We’re trying to expand the number of people shopping in Calvert County — not fight over people,” Mr. Barrett explained. “We’re not trying to shut down local businesses. I’m hopeful that we’re going to bring more people, more jobs, to not only our area but the entire community.”
“If you drive through Prince Frederick during peak retail times, like on a Saturday afternoon, the parking lots are empty. People have gone to other towns to shop. The number of people we do not serve here is incredible, and it blows me away how little retail development we’ve had here.”
So what’s the problem? Where are the retailers?
But Barrett says that big box stores can thrive alongside small businesses in Calvert County; the trick to making the relationship work is to bring in more big retailers.
“The retailers pretty much behave like sheep,” Barrett explained. “You have to get the anchor tenants — like Kohl’s or Target — and the other retailers all kind of follow. You have to get the big guys to commit.”
This commitment hasn’t been an easy one.
The county already has a few notable big box stores: Walmart, Giant Food, and Safeway are already here, and each one is actually among the top five private sector employers in the county. But the current population of Calvert County, and the expected growth patterns, don’t meet the requirements that most newer big box stores want to see.
The median household income in Calvert County is $95,425 as of 2015, according to the Maryland DOC. U.S. Census data from 2010 shows that the population of Calvert County is slightly over 88,000; the projected population in 2020 is expected to be around 95,000. Even though the county doesn’t meet the technical requirements of most national retailers, it’s still a substantial amount of business that’s being taken to other communities.
“We’re losing $465 million a year,” said Barrett. “That’s $1.3 million a day that we spend in other jurisdictions. Our local businesses are suffering now because all of their customers are shopping in other commercial centers.”
Why the Hesitation From Residents?
Reactions to the Armory Square project have been mixed. Many residents believe that there isn’t enough economic activity within the county to support big box stores without causing some harm to local small businesses — perhaps not in the near future, but in the long run.
This hesitation isn’t something that Barrett denies.
“The text amendments in themselves, as they’re advertised, they scare people a bit,” Barrett explained.
“There’s a lot of confusion at first because the text amendments aren’t easy to understand. When we explain to people what the plans really entail, then they’re much more receptive. We have two sketch plans [links can be found here and here] and a transportation analysis that make it easier to understand the project — but we’ve talked to people who had no idea there were any published plans.”
The idea of a huge business moving into Calvert County is scary — there’s no doubt about that.
The local community doesn’t want to lose its uniqueness and doesn’t want to be dominated or defined by a big commercial shopping plaza. But still, as the county’s analysis noted, Calvert residents have an unmet demand for retail space. If this space were filled, the county would bring in an additional $1.9 million in property taxes and there would be 2,553 retail jobs created.
As far as employment goes, small businesses aren’t the only ones that have trouble with employee retention. In fact, nearly six out of 10 businesses in the U.S. struggle to retain employees steadily, and over half of the American workforce admits that they’d leave their current job if something slightly better popped up. Employment rates simply aren’t measured easily anymore, and that makes it harder to connect a big box store’s opening to a decrease in local employment.
Conclusion
The big question here is, will a big box store really ruin the community of Calvert County if it’s allowed inside?
For many Americans, these national chain stores represent convenience and they represent consistency: you always know what to expect from the products you buy there. For others, these stores provide all of the essential items needed for day-to-day living without asking that consumers spend a small fortune on items that they simply can’t afford.
Yes, purchasing non-GMO maple granola cereal and dairy-free, vegan-friendly, organic coconut milk sounds great. But for many American families living from paycheck-to-paycheck, for the parents who calculate a grocery bill down to the last cent before even stepping foot in the store, it’s hard to rationalize spending extra money on “fancy food” when that means that there will be less food.
Forbes reported in 2014 that around 48 million Americans benefit from the Supplemental Nutrition Assistance Plan (SNAP). Around 80% of the U.S. population shops at Wal-Mart, and 75% of these shoppers say that the low prices of Wal-Mart (and other big box stores) are the primary reason for shopping there.
Mark Pothier, writing for the Boston Globe, echoed this sentiment:
“Lately, I’ve been making a beeline for the cereal aisle to fill my cart with Kashi Golean Crunch. It’s sweet and nutritious — essentially a perfect food. On my last Walmart visit, Crunch was selling for $2.84, $1.45 less than at the nearby Stop & Shop. That’s $75.40 in yearly savings if I eat a boxful a week. It’s money I can put in the bank, apply to bills, spend at a downtown Plymouth shop owned by mom and pop, or hand over to another massive corporation I frequent, like Target.”
Truthfully, we haven’t exactly answered the question we’ve posed. The economic landscape of Calvert County has remained stagnant while others have changed, so the effects of any major commercial additions will be completely unique to Calvert. Right now, it’s time for you to sound off and let us know your thoughts.
To weigh in on the big box debate, contact The BayNet at news@thebaynet.com