Gov. Brown introduces plan to increase Oregon’s minimum wage | News, Weather, Sports, Breaking News | KATU – http://bit.ly/1Pw3scn
SALEM, Ore. — Oregon’s governor announced a plan Thursday that would increase the state’s minimum wage to $13.50, and bump hourly pay up over $15.50 for workers in the Portland-metro area by 2022.
The plan is still in the preliminary stages, and Gov. Kate Brown will take her plan to lawmakers when the Legislature meets next month.
“The costs of essentials such as food, child care, and rent are rising so fast that wages can’t keep up,” Brown said in a statement.
“For a single parent with two children, to make ends meet, if she is earning a minimum wage, right now she would have to work over 70 hours a week,” she said later during an interview. “So it’s really important that we increase the minimum wage so that our working families can meet their basic rental housing and food necessities.”
Brown said that after months of meetings, her plan is the best compromise that works for most people.
Oregon’s minimum wage is $9.25 an hour, $2 more than the national minimum.
The change would take place over the next six years to give businesses a chance to plan for the increase. It would be a two-tiered system, offering a 15 percent higher minimum wage to workers in the Portland-metro area “where the economy is growing faster and has traditionally been stronger, than in the rest of the state.”
Brown’s plan would raise the minimum wage to $10.25 in 2017, and increase to $13.50 by 2022. Within Portland’s Urban Growth Boundary the wage would reach $15.52. After that time it would go back to the current rate of increase, reflected by the Consumer Price Index.
Raise The Wage Coalition, a group advocating for a minimum pay increase, responded to the announcement by saying their initial impression is positive, however, there are concerns over some points – like how long it would take to make the change.
Both the Portland Business Alliance and the Oregon Business Association blasted Brown’s plan, saying the two-tier system creates too big a divide between the metro area and outside Portland.
The Oregon Restaurant & Lodging Association sent a statement “fervently” opposing the governor’s plan, focusing on the lack of a tip credit provision.
“The Governor’s proposal without inclusion of a tip credit will result in tens of thousands of job losses in our great state,” Jason Brandt, president and CEO of ORLA, said in the statement.
Oregon’s Senate President Peter Courtney and House Speaker Tina Kotek, both Democrats, said they support the governor’s plan. While they said it is not perfect, it is the best way to avoid a bitter election fight over a possible minimum wage initiative in November.
Supporters of raising the state’s minimum wage to $15 an hour rallied on the Capitol steps before they headed into interim committee hearings that will include discussion about the governor’s proposal.
“I applaud the governor for making the effort. We still have to look at it and see what it does,” said Tom Chamberlain, president of Oregon AFL-CIO.
Watch: KATU/PSU’s October Town Hall on the minimum wage
Statements released about today’s announcement:
Gov. Kate Brown:
Governor Brown today announced her plan to increase the minimum wage statewide. The proposal was developed after conversations with stakeholders in both the public and private sectors. Their input was essential to finding Oregon’s path forward to a higher minimum wage. The plan will be brought for debate during the 2016 legislative session next month.
“The costs of essentials such as food, child care, and rent are rising so fast that wages can’t keep up,” said Governor Brown. “Many Oregonians working full-time can’t make ends meet, and that’s not right.”
Recognizing that Oregon businesses need certainty and time to plan, the proposal calls for a two-tiered minimum wage that increases gradually over the next six years, starting in 2017. The plan establishes a higher minimum wage in the Portland metropolitan area, where the economy is growing faster and has traditionally been stronger, than in the rest of the state.
Outside of the Portland Urban Growth Boundary, the wage will be raised to $10.25 in 2017 and increase to $13.50 by 2022. Within Portland’s Urban Growth Boundary, the wage will be set at 15 percent above the statewide minimum wage, increasing to $15.52 by 2022.
After 2022, the minimum wage will return to the current rate of increase, in conjunction with the Consumer Price Index.
Senate President Peter Courtney:
“I don’t like making public policy through the initiative process. That’s what will happen if the Legislature doesn’t act. This proposal doesn’t make everybody happy. It’s a compromise. It provides a needed increase for low-wage workers. It recognizes the differences between the economy in Portland and rest of the state. It keeps pre-emption. It phases in over a longer period of time. It can help us avoid a bitter, divisive battle over the ballot measures. Now we have to see if we can get the votes for it.”
House Speaker Tina Kotek:
“Today, Governor Brown released a plan for a minimum wage increase that forges a middle ground based on input from both sides of this issue, and I appreciate her leadership.
“Her plan recognizes that the economic reality in the Portland-metro area, where the cost of living is high and rising fast, is different from many communities across the state. The plan also addresses the business need for a predictable phase-in.
“Oregon should be a state where if you work full-time, you don’t live in poverty. The Governor’s proposal would take a significant step forward in meeting that goal. While I personally would support getting to a higher minimum wage faster, many families will be helped by this proposal.
“I can support this proposal because I believe the legislature has an opportunity help thousands of Oregonians by taking action on this important issue in 2016.”
Portland Business Alliance:
The business representatives of the Governor’s work group on minimum wage believe the Governor’s proposal is a missed opportunity to move forward with a plan that works for all of Oregon. However, we remain hopeful a minimum wage that will work for both rural and urban Oregon can be salvaged in the Legislature.
For two months, at the governor’s request, employers came to the table in a sincere effort to negotiate a reasonable minimum wage increase that would be passed by the Oregon Legislature in February, and result in the withdrawal of potential ballot measures in November 2016.
From the beginning, we had principles we thought should be incorporated in any minimum wage increase:
It must work for all of Oregon;
It should phase in on a reasonable schedule that protects against potential job losses;
It should ensure minimum wage policy continues to be set at the state, not local, level; and
It should include an opportunity for training programs for youth and other populations starting in their careers.
The plan Governor Brown announced today does not adequately incorporate these principles.
Throughout our discussions, we offered several options to raise the wage statewide, and we expressed a willingness to accept a higher rate in the Portland area recognizing the additional costs of living in an urban area. Our proposals would have given Oregon one of the highest minimum wages in the country, if not the highest. While we were prepared to accept a phased-in increase, the plan proposed by the Governor, in our view, creates too large a divide between Portland and the rest of Oregon. It ignores the need for a gateway wage for teenagers and first time workers, unduly burdens small business and puts Oregon farmers and other traded-sector employers at an extreme competitive disadvantage in the worldwide marketplaces.
We look forward to working with legislators to express our concerns and continue our efforts to build a minimum wage plan that will work for all of Oregon.
Eugene Area Chamber of Commerce
Northwest Grocery Association
Oregon Business Association
Oregon Health Care Association
Oregon Association of Nurseries
Portland Business Alliance
Raise the Wage Coalition:
Today, Governor Kate Brown announced a proposed plan for legislation that would create a two-tiered minimum wage that increases gradually over the next six years, starting in 2017. Under the Governor’s proposal, outside of the Portland Urban Growth Boundary, the wage would be raised to $10.25 in 2017 and increase to $13.50 by 2022. Within Portland’s Urban Growth Boundary, the wage would be set at 15 percent above the statewide minimum wage, increasing to $15.52 by 2022.
In response to the proposal, the Raise the Wage coalition issued the following statement from coalition members Andrea Miller, executive director of Causa, and Tom Chamberlain, president of Oregon AFL-CIO:
“Last summer, labor and community groups launched the Raise the Wage campaign around a single, fundamental principle: that regardless of where they work, every Oregonian should be paid a wage that allows them to afford the basics. No one who works full-time should be forced to live in poverty.
We remain hopeful that legislators will enact a solution in the February session that meets this core principle and today’s leadership by the governor is a good sign that our elected leaders are serious about working to achieve that goal.
But before we take a position on the specific proposal unveiled today, we need to look closely at whether or not it will have the impact that low-wage workers are waiting for. A quick review shows that it has some positive elements like a higher wage for some high-cost areas but it does not include lifting pre-emption and it lengthens the time frame significantly, which is a concern.
The key question that we will use to evaluate any proposal that comes forward this session is: will it give half-a-million minimum wage workers across our state the real opportunity to support themselves and their families?
As we work with legislators and workers alike to answer that question in the coming days, we will continue to gather signatures for Initiative Petition 58. Our ballot measure increases Oregon’s minimum wage to $13.50 by 2018 and allows local governments to set a higher wage and we know it meets the principles that we stand for.
The bottom line is that half a million Oregonians are waiting for a raise, and it’s time to make that happen in 2016.”
Portland Mayor Charlie Hales:
“Gov. Brown has taken a bold step in ensuring economic opportunity for all Portlanders, and all Oregonians.
The Portland City Council last year raised the minimum wage for City workers, and we saw the tremendous impact it made. People like Kadra, a refugee from Somalia who’s worked for the City for eight years, was able to afford school athletics fees so she didn’t have to choose which of her children could play sports.
When I was growing up in D.C., my mom was a kindergarten teacher and my dad put himself through college driving a taxi cab; we lived a middle-class lifestyle. Those days are gone. Now, with rising costs of living, it’s harder to pay rent, buy a house, put kids in sports; it’s harder just to make ends meet for people who work those jobs.
That’s most clear in Portland, and so Gov. Brown’s plan sets Portland’s minimum wage and tiered increases 15 percent above the rest of the state, reaching $15.52 by 2022.
Gov. Brown is working to help individuals and families in Portland and across the state to live outside low-wage conditions. We thank her for her leadership.”
Oregon Restaurant & Lodging Association:
With Governor Kate Brown’s release today of a proposed dual-region minimum wage increase plan, Oregon Restaurant & Lodging Association (ORLA) is very concerned over the significant likelihood of job losses and economic instability for small businesses throughout the state. The graduated rate increase proposal, which would take effect January 2017 and top out at $15.52 for Portland and $13.50 for the rest of the state, does not include a tip credit provision that 43 other states use to calculate wages for tipped employees.
“The Governor’s proposal without inclusion of a tip credit will result in tens of thousands of job losses in our great state,” said Jason Brandt, President & CEO of ORLA. “At $13.50, it is estimated that Oregon job losses will total 55,000 according to Economics International1, a consulting firm based in Portland specializing in economics and finance, as a result of this flawed policy.” Brandt goes on to say, “That equates to a reduction in wages and salaries of $6.2 billion which will have significant impacts on Oregon’s income tax revenues.”
The comprehensive study confirms that reduced employment rates increase poverty in the state. While it is clear that Governor Brown is trying to improve the well being of Oregonians facing tough times, this proposal will not solve the challenges of poverty. “With an additional 55,000 Oregonians out of work due to this faulty proposal, the very people our Governor intends to help won’t have enough money for food, child care, and rent because they won’t have jobs. For those that do have jobs at the newly established rate, they will experience increased prices for all of these essentials,” added Brandt.
ORLA has proposed a tip credit at the current minimum wage rate of $9.25, meaning that any minimum wage increase at $13.50 or $15 would result in restaurant and lodging workers making the new minimum wage rate through a combination of hourly pay and tip income.
If Oregon lawmakers pass a $13.50 minimum wage without a tip credit, it will mark a sad day for Oregonians who need jobs the most. The Governor’s proposal is far from a solution. The solution is more jobs for Oregonians, not job cuts.
For more information on ORLA’s solution to protect hospitality jobs, review the Tip Credit sheet developed to help educate Oregon’s elected officials available at OregonRLA.org/tipcredit. The white paper, “Impacts of Increasing Oregon’s Minimum Wage,” produced by Economics International Corp., is also available on ORLA’s website at http://bit.ly/EICpaper.
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