Mayor Kevin Johnson’s task force is proposing that Sacramento’s minimum wage rise to $12.50 during the next five years.
It would be lower than what Los Angeles and San Francisco are planning, and it’s not all of what labor wants. But the higher wage will still help many struggling people, and it’s a better fit for Sacramento.
The plan is set to go before the City Council next month. There will be plenty of impassioned debate, as there was Wednesday evening when it was unveiled and chanting protesters walked out.
But the fact that the broad-based task force of 15 council members, business and labor leaders, and policy experts was able to reach consensus should count for a lot. Johnson calls it a “balanced plan.”
As part of a national movement, labor activists are pushing hard for $15 an hour – which San Francisco will reach by 2018 and Los Angeles by 2020. However, those cities have higher costs of living.
City Councilman Jay Schenirer, co-chairman of the task force, says when cost of living is factored in, Sacramento’s minimum wage would effectively be higher than San Francisco’s.
Council members need to look long and hard at whether that’s good for Sacramento and whether $12.50 is the magic number.
Plus, as we’ve written before, the Legislature approved a new state-earned income tax credit, which will be a more targeted way to help low-wage workers. Qualifying taxpayers could get a credit of as much as $2,653, depending on their income and how many children they have.
Under the task force recommendation, Sacramento’s wage would rise from $9 now to $10 next year – tracking the statewide minimum – then rise to $10.50 in 2017, $11 in 2018, $11.75 in 2019 and $12.50 in 2020. After that, the wage would be pegged to the consumer price index.
Employees under age 18 wouldn’t be covered; nor would adult workers with developmental disabilities.
One of the more controversial proposals would also exempt many restaurant employees. Employers would not have to pay the minimum to workers whose tips and commissions push their total compensation above $15 an hour (the average restaurant worker in California makes $22 in salary and tips). Those under that threshold would still get the minimum; in return, the $12.50 wage would take effect two years sooner for these employers.
This is especially important to local eateries, and it would be a first for a local minimum wage in the state. Jot Condie, the California Restaurant Association’s president who served on the task force, says Sacramento’s plan is a “smarter” compromise than the blanket wage hikes in other cities.
In addition, the task force is working out a grace period – perhaps six months – for small businesses.
Income inequality is a huge issue everywhere. A minimum wage increase is only part of the solution, and can’t come at the price of stalling the broader local economic recovery. And Sacramento’s leaders must redouble efforts to attract employers that pay skilled workers $80,000, $90,000 and more a year.
The task force’s proposal still needs final tweaking, but it is on the right track.