A City Club of Tacoma Program

$15 Local Minimum Wage, $12 or $0 Rise

Richard Smaby

The City Club of Tacoma sponsored a program on 15 Now’s Proposition 1 Initiative and Tacoma City Council’s Proposition 1B Initiative Measure. Lyz Kurnitz-Thurlow, 1st Vice President of The League of Women Voters of Tacoma, moderated the program and explained the details on the ballot.

Liz Thurlow-Kurnitz (1st Vice President of the League of Women Voters)

Voters will see on their ballot two parts. First they will have to choose whether they want any minimum wage at all. Then they need to say which minimum wage option they would prefer: $15 starting right away but exempting businesses with less than $300,000 in revenue, or $12 phased in over three years. It is important to choose which option you prefer, because if the first question passes, then the votes on which option to use will be tallied and the majority of those votes decides which option wins.

Ashley Gross (KPLU's business reporter)

The movement for $15 per hour minimum wage has popped up in a very short amount of time. It has grown out of concern over the widening income gap. It is also the result of labor unions going this route to raise the minimum wage, rather than through collective bargaining. It also comes from the federal government not raising the minimum wage since 2009. The federal minimum wage is stuck at $7.25 with no inflation rider. Many states have their own minimum wage. Ours is the highest in the country right now with California and Massachusetts set to overtake us next year with their cost of living increases.

Cities have been acting on their own. Seatac raised its minimum wage recently to $15 in transportation and hospitality industries. Seattle, Los Angeles, and San Francisco have voted to raise their minimum wage to $15 per hour in a series of stages. Proposition1 (15 Now's proposal) would create a minimum wage of $15 in one step, but only on businesses over a certain size. Proposition 1B (Tacoma City Council's counter-proposal) would create a minimum wage in phases reaching $12 in 2018. The City of Tacoma incurs a moral obligation, not a legal one. The city cannot be sued. Seatac does not commit resources for enforcing its ordinance. Cities make up the difference in cost of living with their own minimum wage on top of the state minimum wage. Cities all over the country are writing and adopting minimum wage ordinances.

The New York Times has an excellent article on this economic experiment.

David Boe (Owner of Boe Architects, not speaking as a member of Tacoma City Council)

This is not an issue of what the rate should be. It is a question of business related economics. Raising the minimum wage, when added to B&O tax, sales tax, and property tax makes it very expensive to run a business in Tacoma.

And it doesn't just hurt businesses grossing over 300,000 dollars annually. Smaller businesses have to plan for the possibility that they could exceed the threshold during a given fiscal year and so pay their employees $15 an hour just in case.

We are not Seattle or Seatac. We have 14,000 minimum wage workers working in Tacoma, but only about 5,000 of them live in Tacoma. It benefits workers who live outside of Tacoma much more, because they have a lower cost of living. And they will spend their extra income where they live, outside of Tacoma, so their gain will not benefit Tacoma's economy. We need a state minimum wage not a bunch of local minimums.

There is no money to enforce a minimum wage ordinance. There could be eight city hires costing approximately $800,000. Where would that money come from? Raid the General Fund?

Monique Valenzuela Trudnowski (Co-Owner Adriatic Grill)

If you want to help people of color, consider the history. Since1971 the unemployment rate for black males over 21 years old has never been lower than 30% and has risen as high as 50%. The reason is that as a business owner, I cannot afford to pay $15 an hour for an entry level job. In fact, it is very hard to give them an entry level job at $9.47 an hour. Washington State has the highest minimum wage in the country. Throwing more money at the problem is not the solution. Why are other states that have a lower minimum wage doing OK?

Twenty one years ago I was a mother of two on welfare with food stamps taking a bus to work, as a busser in a restaurant. My solution was not to ask for more money from the state, but to improve my skills, to show that I had more worth to my employer, and to get a promotion.

The Davis-Bacon Act establishing a minimum wage was enacted as a racist policy to prevent non-unionized black, Asian, and Hispanic workers from taking white workers jobs.

Minimum wage jobs are entry level jobs for unskilled workers, not a permanent situation. They are a place to learn a work ethic and then move on to a better paying job. If we give entry level workers $15 an hour, how do we incentivize them to do better?

I hired a young mother 19 years old. She came to me after [sic] college. She had a baby. She had state assistance for childcare and tuition at TCC. I could not pay her above minimum wage, because the state would cut off those benefits. She was going to school to better herself. She was with me for 4 years, got her degree, and left. She now works for Regis Blue Shield. That is the model that works.

Every dollar I make I put back in my business. Good business owners in Tacoma will be penalized, if you vote yes for a rise in minimum wage.

If we raise unskilled workers' wage, they will not be encouraged to better themselves and more skilled and productive workers will end up being paid less than their relative fair value.

Max Highland (15 Now)

The cost of living has continued to go up and the minimum wage has not. The question is not how many people are being paid minimum wage in the city, but how many people are being paid less than they need to survive. When people don't make a living wage, not only do they suffer, but it creates a drain on social services. While there are a few thousand people who make $9.47 per hour, there are a great many more people who make less than $15. The University of Washington did a study that shows that in order to live in Pierce County you need to make $17 to $18 per hour in order to survive without relying on social services and not be one paycheck away from poverty and medical debt and bankruptcy. $15 is a compromise.

$15 per hour minimum wage will create a short term burden on small businesses. But what is really creating a burden right now for small businesses in our city is that people shop at stores like Walmart instead of small businesses because they don’t have enough money to shop anywhere else. Where higher minimum wages have been enacted around the country, we see that small businesses have fared well, employment statistics have fared well, and families have fared well.

We hear that minimum wage workers are teenagers or it’s their first job. But that is not how things have panned out, especially after the downturn in the economy and the false recovery.

It has also been said that this will be the highest minimum wage in the country. But it won’t even be the highest in the state when Seatac does its inflation adjustment in January.

Minimum wage is a local issue, since cost of living varies from community to community.

The federal and state courts will handle laws suits for wage claims. Wage theft is a state and federal crime.