Groups push for livable wages

The proposal would require employers receiving city funds to pay livable wage.

Cati Vanden Breul

Some people who work at businesses subsidized by the city of Minneapolis still need food stamps to put dinner on the table.

But that could change.

A coalition of more than 20 labor, faith and community groups is pushing for a living wage ordinance in Minneapolis that would require city contractors or businesses that receive a city subsidy of $100,000 or more to pay their workers a livable wage.

The coalition defines a livable wage as a salary equal to at least 130 percent of the federal poverty level – the level at which families are no longer eligible for food stamps. The amount currently stands at $12 an hour.

“If employees are being paid off the city dime, they should be able to put food on the table without food stamps,” said Ryan Greenwood, executive director of Progressive Minnesota, an organization pushing for the ordinance.

Currently businesses that receive a subsidy of $100,000 from the city for economic development must pay their employees at 110 percent of the federal poverty level.

But this does not include part-time employees or those under contract such as garbage collectors, janitors or parking attendants, Greenwood said.

A livable wage is not guaranteed for eligible employees, either, Greenwood said, because the current policy is not enforceable.

“If you mess up and don’t pay what you’re supposed to, nothing happens,” he said.

If the proposal before the Minneapolis City Council passes, businesses that choose not to comply with the ordinance would be assessed a fine and would be ineligible to work with the city or get city funding in the future, Greenwood said.

Second Ward City Council member Paul Zerby, co-author of the current proposal, said the living wage ordinance is about addressing the inequities between the upper and lower classes of society.

“These people are trying to work and trying to make their way. And if businesses get something from the city, they ought to pay the people who are working for them good wages,” Zerby said.

He said that if the ordinance passes, businesses would be given a year to comply. Those that give employees health insurance benefits would be required to pay their employees only $10 an hour.

The ordinance would apply only to businesses receiving new subsidies, so companies such as the Target store in downtown Minneapolis, which received city funding in the past, would not be required to change its wage policies.

University economics and finance senior Nathan Kopp, a cashier at the downtown Target, said he is in favor of the ordinance even though his wages wouldn’t change.

“If they get public funding, they should be regulated,” he said.

But Todd Klingel, president of the Minneapolis Regional Chamber of Commerce, said a living wage ordinance could hurt economic growth in Minneapolis.

“It’s not an attractor for someone to do business here; they might see the policy and choose to go somewhere else,” Klingel said.

The city could also lose money if contractors increased labor costs and charged more for their services to help pay for the wage increase.

“The costs could come right back to the city,” Klingel said.

But Greenwood said, in theory, Minneapolis would be saving money because employees paid a livable wage don’t have to take advantage of city services for those who fall below the poverty line.

Zerby said Minneapolis has one of the strongest economies in the state, and businesses would still want to invest despite the wage requirement.

The City Council’s Ways & Means/Budget Committee will have a public hearing on the living wage ordinance Oct. 31, and the full council is expected to vote on the proposal in early November, Zerby said.