Business Alliance Study Questions Big Box Benefits

Business Alliance Study Questions Big Box Benefits
Originally published online at News8Austin.com on October 6, 2004

Big Box stores that feature lower prices are everywhere. Now a new study shows those low costs come at a price to many local governments and residents in the form of tax dollars.

The study was done by the Austin Independent Business Alliance, which says Big Box retailers pay their employees low wages and force the public to make up the difference.

"Big Boxes do tend to offer lower prices on consumer basics, but they also suppress the growth of diverse local retailers. Second, big boxes can generate direct and indirect cost on local governments and jurisdictions that exceed the taxes and fees that they pay to local governments," Michael Oden, of The University of Texas School Architecture, said.

"There is a gap between the amount of money that a retailer will be able to bring into a city, county government, to school districts through taxes and fees and the amount they are taking out in the form of city services. If that gap gets wide enough we are talking about county and all local governments paying in virtue of that retailer being where they are," William Spelman, of UT's LBJ School, said.

The Austin Independent Business Alliance study challenges a study done by the City of Austin this last summer.

The city's study found Big Boxes don't have a negative affect on the local economy.