June 11, 2014 (San Diego). In a vote of three to one, the increase in the minimum wage and five day sick leave was moved from the Economic Development and Intergovernmental Relations Committee to the Full Council, for consideration on June 16. According to Council President Gloria, the June 16 hearing at the full Council is not the final action on this proposal. Whether this will go to a vote of the City Council, or to the voters, will be decided later in the Summer.
The proposal, if approved, will increase the minimum wage to $11.09 in July of 2015, $12.09 on July of 2016 and $13.09 in July of 2017. After that the minimum wage will be indexed to the Consumer Price Index (CPI) every January. Right now there is still discussion of whether to bring this to the voters, or solve it internally.
It was also a standing room only and some people needed to go to the overflow room.
During the May hearing mostly supporters of the initiative were present. At the time business leaders were not ready to have a say. After all, we did not have solid numbers yet. At this point we do. Therefore the business community was present in numbers to talk their opposition.
Lia Smith summarized the issues for the Home Health Care Providers this way: “We represent private pay home care agencies, where Seniors have to pay out of their pocket. And the disabled have to pay for their care out of pocket.” She added that “the raise to $13.09 takes the wage almost five dollars an hour. Which means, after taxes we have to pay almost seven dollars an hour.”
This will inevitably raise the cost of the services they provide making it unaffordable for both Seniors and disabled people on fixed incomes.
Robert Nothoff of Raise San Diego had another take on this. He said that “anybody who works full time isn’t living in poverty. We want to make sure that anybody who is sick, or has a sick child, is able to stay home and take care of themselves without losing a day’s work of pay.” This means that these workers will have issues paying a bill at the end of the month, or rent, or put food on the table.
Northoff also said that while a Bill has been passed by the State Senate with the same result, they want to still “control things locally in case things break down in Sacramento.”
As to the business arguments that it will lead to inflation, Northoff referred to the San Francisco experience and the ten years of evidence. Business made similar arguments in San Francisco, in the end they compromised, but the inflation that was actually experienced was minimal, almost did not register.
During the testimony given to the committee both supporters for the policy and those against it came froth. The Chamber of Commerce made the argument that indeed it would lead to the closure of business, and lack of competitiveness with other cities. It would lead to a bad business environment.
Sean Karafin of The San Diego Taxpayer Association emphasized their study results, that the best route to reduce to reduce poverty is not a wage increase, but rather work force development. This is the same argument that he made in the study he wrote. He also argued strongly that it was best to let the State increases play out before the City on this policy.
The heart of the concerns by business owners was a lack of an even playing field with other cities in the area, and higher costs to do business.
Harry Schwartz of Ace Hardware, downtown. not only asked the city to hold off on implementing this. But he also offered policy alternatives in writing that Council Member David Alvarez was intrigued by, and thankful for. What these proposals are is not clear at this point, but they are now part of the conversation and Alvarez invited other members of the business community to get involved.
For the most part, members of the Home Health Care community were very concerned that this could force them to reduce service, reduce hours, or worst, fire staff.
On the other hand, supporters of the policy, including Richard Barrerra of Secretary \Treasurer of the Central Labor Council, San Diego\Imperial Counties, was very supportive of it. He told the Council that this would expand access to six days to 285,000 San Diegans, increase the wages of 220,000 San Diegans, raise the annual income of affected employees by $3,000 dollars, and finally put more than $660 million into the pockets of low income San Diegans.
This last detail would boost the local tax base and circulate more money in the economy.
Francine Maigue of Lorena Gonzalez’s office also came today to support this policy. She is her District Director.
We also had stories from multiple minimum wage workers that are struggling to make it.
After the hearing was over I asked Barrera about other cities in the County. Barrera said that they are already in talks with both Chula Vista and National City.
Categories: City Hall Politics