Minimum wage may rise 5%

Business group wants hike delayed because of recession

Bob Quick | The New Mexican

11/13/2008 - 11/14/08

Santa Fe's mandated minimum wage of $9.50 an hour is likely to rise to almost $10 on Jan. 1 — an increase the Santa Fe Chamber of Commerce wants delayed until the economy gets better.

The city last year put off a scheduled hike to $10.50 under a deal that linked future adjustments to the Consumer Price Index and expanded the ordinance to include smaller businesses. The first such adjustment is set to kick in at the start of 2009.

"Right now it's a 5 percent increase," Laura Banish, the city's public information officer, said Thursday. "But we don't have a hard number. We should know by the end of November so people can use it for their budgeting."

Simon Brackley, president of the Santa Fe Chamber of Commerce, is asking the City Council to delay the local wage boost until the national economy gets better.

Whether or not the council agrees, the local wage floor would remain well above the statewide minimum, which is set to rise on Jan. 1 to $7.50 an hour, up a dollar from the current level.

"With higher electric and water rate increases already in effect, we are concerned about job loss if there's a wage increase," Brackley said. "It's very important to keep Santa Feans employed and working."

Brackley said he spoke to one chamber member who employs at lot of young people seasonally. "This increase will force him to close his doors," Brackley said. "I've talked to hotels, and they're very concerned about the national economy and the impact it will have locally."

Ed Ross, owner of the Santa Fe Schlotzsky's Deli, said the higher minimum wage will have a "significant impact" on his business.

"We're already cutting hours to try to adjust to the current situation," he said. "I haven't laid anybody off yet."

Restaurant sales are soft all over Santa Fe, Ross added, and that situation could worsen when wages rise for low-skill jobs.

Carol Oppenheimer of the Living Wage Network, which took the lead in fighting for passage of the city ordinance, said delaying the increase when the economy is weak "would be a big mistake" because it would hurt workers hardest hit by the current recession.

"All we're asking is that workers keep up with inflation," she said.

Testimony during a 2003 court trial involving the city and business groups that opposed the wage mandate indicated that, even with a dollar increase in the minimum, "there would be very little impact" on businesses' bottom lines, Oppenheimer said. "Businesses would not go under."

Oppenheimer also said a resolution introduced at Wednesday's City Council meeting by Mayor David Coss should help move the local economy forward and create more jobs.

Coss proposes that the city invest $400,000 in promoting the city's 400th anniversary, put another $500,000 into energy conservation and alternative energy and act to gain economic benefits from such new city assets as the Santa Fe Community Convention Center, the redeveloped Santa Fe Railyard and Rail Runner Express commuter train service scheduled to start next month.

Coss also wants to adjust the utility-rate structure to encourage conservation and economic development in the hospitality sector, including hotels and restaurants, states the resolution, co-sponsored by City Councilor Rosemary Romero.

The planned minimum-wage adjustment will be based on the U.S. Department of Labor's Consumer Price Index, a measure of the average change over time in prices paid by urban consumers for goods and services. These include food, housing, transportation, fuel, medical care and other expenses.

Santa Fe's minimum wage is linked to the index for the Western region, which includes New Mexico, Colorado, Wyoming, Montana and other states.

Over the past decade, the index has seen increases ranging from a low of 1.6 percent in 1998 to a high of 3.5 percent in 2000 and 2001. The change in this year's CPI is expected to be greater, driven in part by gasoline prices.

The city first adopted a minimum-wage law in 2002. The rules originally applied only to employers with 25 or more workers. But the amendments last year that provided for automatic annual adjustments also widened the law's scope to cover employees of all businesses that require city business licenses.

Contact Bob Quick at 986-3011 or bobquick@sfnewmexican.com.