Congress might be stalled on raising the nation’s minimum wage, but the District is in the thick of a debate that could raise incomes for low-wage workers around Capitol Hill.
“The train’s left the station,” was the sentiment expressed by D.C. councilmembers Vincent Orange and Tommy Wells during a Monday afternoon hearing on four competing proposals relating to an increase for the city’s $8.25 minimum wage.
Rather than trying to derail the train, as various business interests have thwarted efforts to increase the federal minimum wage, the local business community is asking D.C. to decrease speed and wait for economists to produce studies on how such legislation might affect jobs and investments.
“We ask that the process be approached slowly,” said Barbara Lang, president and CEO of the D.C. Chamber of Commerce. The chamber supports an increase to the minimum wage, but it must be “reasonable” and “not defeat the great gains we have made in the economic landscape,” Lang said.
The city must strike a balance between the interests of the nearly 42 percent of D.C. residents who earn less than $30,000 annually with the city’s pursuit of new business, which has recently resulted in historic revenue increases.
Ed Lazere, executive director of the DC Fiscal Policy Institute, said those gains have come along with a widening gap between high-wage and low-wage workers and a decrease in affordable housing.
“Those trends will continue unless we set trends to reverse them,” he warned.
Momentum for an increase peaked in July, when the council passed legislation that would have required certain large retailers to pay to compensate workers at a rate of $12.50. Mayor Vincent Gray vetoed that bill, a move that cleared the path for Wal-Mart to open six new locations in the city, but also vowed his support for an across-the-board wage increase.
Among the details to be ironed out in the latest push are how much more workers would earn, what the time frame would be for raising the wage and whether the city’s abundance of tipped workers, who currently earn a minimum cash wage of $2.77 from their employers, would see their base pay increase. That last topic was at the forefront of much of the testimony Monday, when the council heard from almost 150 witnesses.
“In many cases, tipped employees earn more than management,” said Marc Barnes, owner of The Park at Fourteenth, a popular nightlife spot. Barnes and other restaurant industry witnesses said the management ensures tipped employees take home at least minimum wage each week, and most take home much more. Increasing the base pay would strain resources and force restaurants to raise prices, they argued.
The most popular proposal, supported by eight of the council’s 13 members, does not include an increase in base pay for tipped workers. It would boost the minimum wage to $10.25 over the course of two years, then tie the rate to cost-of-living increases. It would also increase the standard deduction for District taxpayers and establish a small-business property tax credit to help offset costs.