SALEM — Few issues that lawmakers face this session have the potential to be as divisive as Oregon’s minimum wage.
Proposals to increase it — and to remove the ban on cities and counties setting their own rates — separate Democrats from Republicans, Portland from the rest of the state, labor unions and human services groups from businesses.
Yet when legislative committees take up the issue in public hearings April 13, it is uncertain how lawmakers will act, even though Democrats have comfortable majorities in both chambers.
The hearings are scheduled just eight days before a deadline for action by the chamber originating a bill, although there are possible bypasses available to leaders.
“There are a bevy of approaches, from lifting the (state) pre-emption to raising it to $15, and everything in between,” House Speaker Tina Kotek, D-Portland, told reporters last month.
Democrats sponsor all the bills except two, which committees propose to link the rate with the federal poverty level.
Oregon has the second highest state rate at $9.25 per hour, the increase automatically linked to inflation and effective at the start of this year. Only Washington state, at $9.47, has a higher state rate. But six states, including California and Massachusetts, are poised to reach or exceed $10 in 2016 or later.
Oregon is among 10 states where lawmakers are talking about raising the rate. But none has passed an increase yet, and the Republican majority in the Washington Senate has blocked a $12 rate passed by the Democratic-controlled House.
The minimum wage is unlike several must-do bills that Democrats have passed and Gov. Kate Brown has signed already, or that at least have advanced.
“At this point, simply because they have put it off for so long, it seems it is not a priority of this Legislature,” said Jim Moore, who teaches politics at Pacific University.
“The Democrats do not seem super-enthusiastic about it. It also plays into the issue of rural economic development — so we do not know how serious they are going to be about this.”
The group 15 Now PDX, part of the larger Fair Shot for All coalition, organized a Capitol rally on Jan. 24, about a week before lawmakers opened their 2015 session.
“We firmly believe $15 is the right number for Oregon,” said Justin Norton-Kertson, a founder. “We certainly would not be unhappy if it passed at $12 or $13. I think it’s safe to say that any increase in the minimum wage is a good thing. It would still be a raise for working people”
But Oregon’s major business groups actively oppose an increase or are neutral.
“We think increasing the minimum wage above what is already the second highest in the nation is going to deter employers from taking a chance on people who might have lower skills or experience,” said Betsy Earls, vice president and counsel for Associated Oregon Industries.
“A minimum-wage job gives people an opportunity to gain skills and experience.”
D.J. Vogt is vice president for governmental affairs at the Oregon Business Association, most of whose members he says already pay more than the minimum wage and would be unaffected by an increase.
Still, he said, most members are opposed, although the association is officially neutral.
“We do not view the proposal for $15 as viable,” he said. “However, we’d probably be pulled into opposition if a $15 proposal were to get (political) legs.”
Oregon is among the 29 states and Washington, D.C., with rates exceeding the federal minimum of $7.25, set back in 2009.
President Barack Obama issued an executive order last year raising the rate for federal workers and contractors to $10.10. But only Congress — now with Republican majorities unlikely to act — can raise the federal minimum.
It’s been more than a quarter century since Oregon lawmakers themselves raised the minimum wage, which went from $3.35 in 1989 to $4.75 in 1991.
Voters passed subsequent increases in 1996, when it rose in stages from $4.75 to $6.50 by 1999, and in 2002, when they linked future increases to the Consumer Price Index.
While two public opinion surveys conducted in December show some similarities, they came to opposite conclusions about where Oregonians stand on the issue.
Both say most Democrats favor an increase to as much as $15 per hour, and most Republicans oppose it. Both say support for an increase is greater in the Portland area, where half the state’s jobs are, than outside it.
But a poll conducted by GBA Strategies of Washington, D.C., for a coalition of Oregon supporters found 54 percent of those sampled in favor and 38 percent opposed.
A poll conducted by DHM Research of Portland found a much closer division, 50 percent opposed and 46 percent in favor.
The sampling sizes and methods differ. The margin of error in the first poll was 3.5 percentage points; in the second, 5 percentage points.
According to the National Conference of State Legislatures, 20 states raised their rates on Jan. 1.
After 20 years as an accountant in “corporate America,” Deborah Field joined with her husband, John, in opening Paperjam Press, a print and design shop in Northeast Portland. They have four employees, down from 10 before the economic downturn, and all are paid more than the minimum wage.
“When employees feel they are compensated fairly at a level that allows them to have a better quality of life and pay their bills, I think you are enhancing their sense of confidence and pride,” said Field, who has not endorsed a specific increase.
“It leads to better performance and a strong sense of happiness and loyalty, so I think it ends up helping your bottom line.”
Field acknowledges that some small-business owners oppose increases in the minimum wage because of the “fear factor.” But she said they get a return in the form of greater spending.
“I know my employees know the importance of supporting the local economy by taking their dollars, spending them in the community and helping small businesses,” she said.
Seattle and San Francisco have raised their minimums to $15, which will be attained in stages over several years.
“That helped open up the discussion in Oregon and created an atmosphere where $15 was a more reasonable demand,” said Norton-Kertson, the 15 Now PDX spokesman.
Multnomah County agreed in December to raise its minimum for its government workers from $11.99 to $15 over the next three years. The Portland City Council voted in February to raise its minimum to $15 for full-time city workers and contractors, although it excludes part-time and seasonal workers, mostly in the Parks Bureau.
Oregon cities and counties, however, cannot set rates for private employers independent of the state.
Even if lawmakers raise Oregon’s minimum to $15, Norton-Kertson said local governments ought to be free to set even higher rates.
“Having that (2001) pre-emption law repealed is important so that Portland is not stopped by the same minimum wage as the rest of the state when the cost of living is so much higher,” he said.
Twenty associations representing business, industry and agriculture have labeled all the proposed minimum-wage increases as one of 11 “job killers” pending before the 2015 session.
The list actually covers 23 bills. But some of them, unlike minimum wage, have advanced past some committees.
“I am not sure if this Legislature will do something about the minimum wage or whether it will end up on the ballot” in 2016, said Earls of Associated Oregon Industries.
“But I think there is a recognition that businesses provide jobs, and I am just hoping that recognition carries all the way through to the end of this session, when things tend to happen fast.
According to a January report on “The High Cost of Low Wages” by the Labor Education and Research Center at the University of Oregon, a minimum-wage increase is among actions that could help reduce the dependence of 197,000 workers on food assistance and other public services provided through state government.
The report classifies up to 400,000 workers in “low-wage work,” defined as paying less than $12 per hour. Most of those jobs are concentrated in five categories: fast-food restaurants, health care support, personal care, retail sales, and buildings and grounds maintenance.
But Earls rebuts arguments by advocates that a minimum-wage increase would reduce income inequality.
“It is a better investment of everybody’s time and money to support workforce training programs that will enable people to gain the skills to move into naturally higher-paying jobs,” she said. “I doubt the minimum wage is ever going to be the place to get over that problem.”
The Oregon Business Plan, endorsed by AOI, the Oregon Business Association and other groups, backs education and training as one way to move Oregonians closer to a 2020 goal of national per-capita income.
Oregon’s most recent minimum-wage increase benefited an estimated 142,000 workers — about 6 percent of the total workforce.
OBA’s Vogt said a minimum-wage increase is not a panacea.
“We are not looking at moving the needle for the entire state’s economy, so we came down as neutral,” he said. “A small increase is not going to wreck the economy. It’s also not going to boost that many people’s quality of life.”
The Capital Bureau is a collaboration between EO Media Group and Pamplin Media Group.