CHICAGO – A proposal to impose a “living wage” on large retailers operating in Chicago has Target and Wal-Mart threatening to leave the city, reports the Chicago Sun-Times.

“The saber-rattling is intensifying as the clock winds down toward a July 26 showdown vote on plans to make Chicago the nation's first major city to establish a ‘living wage’ for stores with at least 90,000 square feet of space operated by retailers with $1 billion in sales,” writes the newspaper, noting that the retailers would be required to pay employees at least $10 an hour and $3 in benefits by July 1, 2010.

In protest of the ordinance, Wal-Mart has threatened to abandon its plans to open at least 20 new stores in Chicago if its city council approves the measure, while Target says it will put plans to build three new stores in Chicago’s South Side area "on hold" and possibly close existing stores located in the city.

According to ProgressiveGrocer.com, support for the ordinance “appears to remain strong in the council, whose supporters contend that urban markets have become so attractive to big retailers that the measure's provisions would not prevent them from opening stores in the city.” Chicago Mayor Richard Daley is opposed to the ordinance.