Wal-Mart's 'super' study just wasn't worth LAEDC trouble.

WHAT was the LAEDC thinking?

The recent release of a study it did the economic impact of proposed Wal-Mart Supercenters on the L.A. area set off a firestorm in what is already a hot debate over the retail behemoth and its future in the area--awareness of which has been heightened by the opening of a new regular-size Wal-Mart at Fallbrook Center in West Hills last week.

The LAEDC (short for the Los Angeles County Economic Development Corp.), which is a well-respected non-profit organization, came to the conclusion in the study funded by Wal-Mart itself that the building of Supercenters would produce a net increase in jobs. These huge stores that carry groceries in addition to all the other stuff a regular Wal-Mart sells would also provide benefits of lower prices that would offset the lower wages that the stores foster in the grocery industry.

Wow. That's not what we were expecting. Big, bad Wal-Mart might actually do some good?

That's also not what a lot of people wanted to hear, especially those wanting to keep the Supercenters out of the Valley and the rest of L.A.

But whether you like Wal-Mart or not or low prices or not, you gotta really think that it was a mistake for the LAEDC to take on the $65,000 study.

I want to go on record that even though Wal-Mart paid for the study, I do believe it was done in an impartial manner considering LAEDC's fine reputation. But Wal-Mart is just too big and is too much of an economic bully for many people to get past those perceptions to hear anything constructive that might be coming out of the study.

So the LAEDC was in a no-win situation and may have been a little bit naive in taking on the study. It just really wasn't worth the bother. Many people just won't believe that the study wasn't orchestrated by Wal-Mart.

Gregory Freeman, director of policy consulting for the LAEDC and the person who did the study, assured me it was totally above board--and rather routine. It's just one of many that the LAEDC does on a routine basis for clients both public and private who commission them. It's part of the consulting function that the LAEDC performs. There's no pre-set conclusions drawn before a study is performed and no meddling by the client in executing the study, he said.

"If I can't get up and say that this was an independent study, then I've destroyed my credibility," Freeman said.

But he admits that Wal-Mart felt there had been a raft of negative studies on their Supercenters and company officials felt that it was time to look at both the good and the bad of the entrance of Supercenters into Southern California.

"If all the coverage is negative, than even a neutral study is better," Freeman said about Wal-Mart's rationale for commissioning the study.

Freeman said he was surprised by the results--and feels that he may not get the same results in other parts of the country.

The fact that lower prices offered by Wal-Mart would bring annual savings of $1.8 billion for total households in L.A. County is due to the area's enormous population. The study found that if consumers spent all that money it could create 17,300 jobs. That large number, again, is due to the sheer size of our area. You wouldn't find those numbers in Kansas.

Freeman said that any impact that Wal-Mart Supercenters will have on competition in the area will be muted by the fact that the company is rolling out only a few of these stores over an extended period of time.

Besides, you probably will only see Supercenters in the outlying areas of the San Fernando and other valleys. These are big suckers and where's the available land?

We all probably should relax a little bit about this.

Progress on Panorama

My fears that the grandiose plans for Panorama City's revival would never fully be realized are getting allayed somewhat. At least one official act has been undertaken concerning the proposed project which has received much publicity in recent months.

It's got nothing to do with any city action or actual implementation of the plans but it does show that it is being taken seriously outside of the local community. The American Institute of Architects California Council has given its President's Award to the AIA San Fernando Valley chapter for its efforts in forming an Urban Design Assistance Team (UDAT) to come up with a guideline for the area's revitalization.

It's just an award but it gives the Panorama concept some prestige and makes it stand out a little bit in the state. I had feared that like with a lot of things, the much publicized plans would just go on a shelf and never be heard from again. But beyond the recognition in the architectural field, there's some real buzz within city government and economic development circles on the proposed project. A lot of people really want to make this happen. It's good to see such enthusiasm for a project that would put some life into an area that really needs some help.

Business Journal Editor Jason Schaff can be reached at [phone] or at [e-mail].