Belmont grapples with minimum wage

Councilwoman Davina Hurt said she typically favored letting the free market determine wages and prices, but said it was time for the city to act on behalf of low-wage earners, who she noted have faced difficulties staying in the city with the area’s rising cost of living.

“The market’s motivations are not always on par with humanistic needs,” she said. “This is where government is helpful, this is where government can stay strong and hold a baseline.”

Following the council’s February meeting, Hurt and Mayor Charles Stone formed a subcommittee aimed at examining a local minimum wage, holding community meetings in the summer and fall to gauge its effect on business owners and residents. They have also looked at a local minimum wage ordinance the San Mateo City Council passed last year, which phases in a two-step wage increase for all businesses, regardless of size, with the minimum hitting $12 Jan. 1, 2017, then $13.50 the following year and $15 by 2019.

Up for review Tuesday were three options for accelerating the state’s process for increasing the minimum wage for local workers to $15 an hour, slated to rise incrementally until it reaches $15 an hour for all workers Jan. 1, 2023. The state's next rise is slated for Jan. 1, when companies with more than 26 employees will pay a minimum of $11 an hour, and those with 25 or fewer will pay $10.50. City Manager Greg Scoles presented one option including a proposed minimum wage bump to $15 an hour by 2020 and two others charting out an increase to $15 an hour by 2021, with adjustments by the consumer price index in subsequent years.

Though Councilman Warren Lieberman acknowledged the challenges many families face in the region face to make ends meet, he expressed concerns about the policy’s potential negative effects on small business owners and emphasized the need for more information on how many residents and business owners might be affected by such a policy before the council makes a decision.

“We have no clue what is going to happen,” he said, adding that increasing the minimum wage for those who are the heads of households would have a much different effect than it would on those who are not reliant on the income they make from minimum wage jobs. “All of that tells me that I want to try to act as carefully as we can.”

Lieberman suggested officials look at other ways a local minimum wage could be structured to mitigate the effects it could have on small businesses that may be unable to survive with the change. He suggested applying a local ordinance to larger businesses or putting in provisions to review wage increases once the city’s minimum wage reaches $15 an hour instead of deciding on a timeline too far in advance.

Loring De Martini, owner of the Van’s Restaurant, wasn’t convinced diners would pay the price increase restaurant owners would need to implement to be able to afford paying higher wages for their employees. He predicted the city’s consumers, including those whose wages might increase under a local minimum wage, would pay more for goods and services, which could offset any wage increases they might see under a local minimum wage.

“The people of Belmont are going to pay and pay dearly,” he said.

Because servers at some restaurants may make minimum wage supplemented by tips, restaurant owners have expressed concerns about a local ordinance disproportionately affecting wages at their businesses. Combined with the fact that California state law does not currently make provisions for a tip credit allowing restaurant owners to pay those earning tips below minimum wage if their hourly wages combined with tips bring them over the minimum, the change has been viewed as a potential burden for restaurant owners.

Stone did have concerns about how higher prices in the city might affect Belmont business owners, and said he hoped other nearby cities like Redwood City, which reviewed a local minimum wage at its Sept. 25 City Council meeting, would join San Mateo in enacting a local minimum wage so there would be fewer price inconsistencies across cities in the county.

Michelle Buzbee, an 18-year-old Belmont resident, urged the council to consider the tough choices those making minimum wage are faced with given the high cost of living in the area. She said she has moved three times in the past year to stay in an area she calls home, weighing the high costs of rent and transportation against the wages she’s earned at a hardware store to support herself and her studies at community college.

“Please hold yourself accountable to your communities, and realize that people living on minimum wage are struggling at the expense of their health and needs,” she said. “It’s not getting any cheaper and the wage is just staying stagnant.”

Stone said he was supportive of making increases even faster than the three timelines proposed to boost the wages of those making the minimum as soon as possible, but was willing to find a compromise to mitigate the effects of small business owners.

“I’m starting from a compromise position because I recognize this is going to be difficult for small businesses to absorb,” he said. “But on something like this that affects the folks that are hanging on by a thread, I’m compelled to act.”

The council is set to review the ordinance again at its Nov. 14 meeting.

anna@smdailyjournal.com

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