Minneapolis living wage measure moves forward

Categories: Minneapolis

The ways and means committee of the Minneapolis City Council voted to toughen up the city's living wage ordinance this afternoon. The measure passed 4-2, with council members Barret Lane and Dan Niziolek in opposition.

Under the new ordinance companies that contract with the city to provide services or that receive financial subsidies from the city will be required to pay 130 percent of the federal poverty level. In current dollars that works out to $12.09 per hour--or just over $25,000 a year. If the company provides health insurance, the wage requirement drops to 110 percent of the poverty level, or $10.23 an hour.

The ordinance will come before the full council for a vote on Friday, but passage is already assured. Nine council members have signed on as co-sponsors of the bill, a veto-proof margin.

There are some loopholes in the measure, however. Small businesses and nonprofit groups that bring in less than $1 million in revenue annually or have fewer than 20 employees aren't subject to the wage strictures. Nor are nonprofit groups that provide health and social services to poor people or organizations that run job-training programs. In addition, companies can be granted a waiver from the salary requirements if a simple majority of the city council votes in favor of it.

Perhaps the most noteworthy aspect of the living wage ordinance is that it has a credible enforcement mechanism. Companies that are found to violate the law will be penalized 20 percent of their contracts. Additionally, the offending organization will be barred from reapplying for municipal contracts for one year.

The chief concern expressed at today's public hearing was that the policy would isolate Minneapolis, causing businesses to flea to surrounding municipalities in order to avoid paying higher wages. City council president Paul Ostrow brought up the smoking ban as a well-intentioned effort that has had an adverse financial impact on the city by driving bar patrons to St. Paul and other surrounding municipalities.

"The city of Minneapolis can not go it alone on these matters," he told the council. "It has to be regional."

Progress on passing a similar measure in St. Paul has stalled pending the outcome of the current mayoral race. Ryan Greenwood, executive director of Progressive Minnesota and co-chair of the Yes! Living Wage Coalition, which has spearheaded the effort, says that Mayor Randy Kelly wanted too many loopholes written into the ordinance before he would endorse it, such as exempting part-time and seasonal workers. "It became clear to us that to get something through him we were going to have to leave too many workers behind," says Greenwood.

He notes that mayoral challenger Chris Coleman has fully endorsed the living wage effort, as have a majority of the city council members. The coalition hopes to re-galvanize efforts in St. Paul after the November election.


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