Alaskans largely oppose the Albertsons and Kroger merger

By Jasz Garrett

Juneau’s Fred Meyer store. (Photo credit Jasz Garrett/KINY)

Juneau, Alaska (KINY) – Safeway and Carrs owner Albertsons and Fred Meyer owner Kroger announced this fall that they would sell hundreds of locations – including 14 in Alaska – to meet merger requirements.

U.S. Representative Mary Peltola sent a letter to the Federal Trade Commission (FTC) urging them to block this merger in August of last year.

Since then, Alaska’s Senate delegation, 24 state legislators, and the Anchorage Assembly have also expressed concerns with or opposition to the proposed merger. Rep. Peltola previously held a town hall on the merger in early December.

On Thursday afternoon, Rep. Peltola hosted an event in conjunction with the Alaska Teamsters Union, Local 959 to discuss the merger.

Senator Jesse Kiehl, who represents Juneau, Haines, Skagway, Gustavus, and Klukwan, gave his thoughts during the roundtable discussion.

He referred back to a decision made years ago to consolidate freight and barge service in Southeast. The Alaska Department of Law became involved and negotiated.

“Because the markets here are so small, and because the business is complex, and the fixed costs are large, it was a year and a half, maybe two years before we had the functional monopoly we feared. One small operator with limited sites and limited stock and limited vessels just couldn’t serve, couldn’t compete on par with the big operator,” he said. “You can’t go back and deny a merger later, once it’s happened.”

He added that he thinks Rep. Peltola’s idea to have the FTC visit Alaska to see the reality of everyday life is important. Rep. Peltola said she thinks it’s important for the FTC to understand the different prices Alaskans pay for groceries.

Sen. Kiehl said the impacts on Southeast communities would be widely felt should the merger go through.

“It really is something the FTC ought to deny. And I hope you’ll push in that direction. The impacts of monopoly here in Southeast are so massive economically,” Sen. Kiehl said. “Before I left the Juneau Assembly. I had the free marketeers of the Chamber of Commerce talking to me about could we build another port and subsidize a new entrant with public dollars to the freight business in Southeast? That’s how bad it was for all of them who needed to move supplies and products out. It’s huge.”

Other Alaska Senators and Representatives talked about the complexity of the corporation’s influences across the state.

They expressed concern over the uncertainty of what would happen if stores were sold, especially if it’s a town’s only option.

It was recognized during the discussion that Anchorage serves as a grocery hub for surrounding villages. Overall, it was agreed by the roundtable participants that Alaska’s needs are different than any other state when it comes to groceries.

Senator Löki Gale Tobin, who represents District I, spoke during the roundtable discussion.

“As many know, I represent a district that has a CARRS Safeway. It’s the only grocery and pharmacy that we have in our community, particularly downtown. And I’m very concerned as we hear about these closures and particularly with stores that are close in proximity, that there will be an interest in keeping the stores in town,” she said.

Sen. Tobin added that the merger could potentially push people to leave the community for a place with more accessible resources available.

Rep. Peltola noted the Lower 48 has the advantage of ordering food online, with it sometimes arriving the next day. Alaska does not have that luxury, with many vendors refusing to ship to the state altogether, shipping taking longer, or rural Alaskans not having internet access. She called the merger a statewide issue that could have “cascading effects on distribution”.

Rep. Peltola said that when speaking to the FTC Secretary Chair, she was told there were three options: the denial of the merger, negotiations, or letting the merger go on without any regulation or oversight. She also said her team was denied the opportunity to tour the warehouse, and that the lack of transparency has been concerning.

“This merger is no laughing matter. This is a really serious issue for many people across Alaska,” she said. “We’ve been seeing incredible participation from all over the state.”

Rep. Peltola said another large concern is that as the companies get larger and larger, there will be more challenges in negotiating wages for union members. Additionally, the Alaska Teamsters Union, Local 959 raised concerns on food security and disaster responses.

Rep. Peltola encouraged Alaskans to submit detailed letters to the FTC with their concerns. She said the more in-depth the letters are, the better.