- The Washington Times - Tuesday, June 7, 2016

D.C. officials, business owners and labor unions reached an agreement Tuesday to raise the District’s minimum wage to $15 an hour, but some business advocacy groups said the legislation will likely kill jobs or force companies to move to Virginia.

Under the agreement, the minimum wage — currently $10.50 per hour and scheduled to rise to $11.50 on July 1 — will increase to $15 by 2020. The wage will be linked to inflation and rise automatically after that. The minimum wage for tipped workers — currently $2.77 an hour — will grow to $5 per hour by 2022, with automatic increases linked to inflation thereafter.

The District joins several other U.S. cities, including Seattle and Los Angeles, that are gradually increasing the minimum wage to $15 an hour. San Francisco will be the first to do so when its hourly minimum rises to $15 on July 1, 2018. New York and California also plan to raise their minimum wages to $15 an hour by 2020 and 2021, respectively.

“I see how much it costs to live in Washington, D.C., and that cost is only going up,” D.C. Mayor Muriel Bowser said Tuesday, promising to sign the legislation when it reaches her desk. “Even at $15, it’s tough to be able to afford to live in Washington, D.C.”

But criticism of the legislation came from an unexpected quarter: House Speaker Paul D. Ryan, who made an appearance Tuesday at the District’s low-income Anacostia neighborhood in Southeast to announce an anti-poverty plan.

“I think that will actually do more harm than good in so many instances because what it does is it prices entry-level jobs away from people,” said Mr. Ryan, Wisconsin Republican. “There are far better ways of helping economic growth.”

Still, the District’s minimum wage legislation represents a compromise among business owners concerned about costs, labor unions advocating for workers and city leaders seeking a balance.

The bill originally put forward by Ms. Bowser called for raising the minimum wage to $15 an hour by 2020 and the tipped minimum to $7.50 by 2022. Input from various stakeholders allowed council member Vincent Orange, at-large Democrat and chairman of the committee that oversees pay rates, to tweak the legislation to its present form. Some local restaurant owners complained that the tipped-wage jump to $7.50 per hour would cost them jobs and severely cut into their already slim profit margins.

The legislation will undergo the normal 30-day congressional review period, said Lindsey Walton, chief spokeswoman for council Chairman Phil Mendelson, at-large Democrat. Ms. Walton said she didn’t have any indication as to whether Congress would strike down the measure.

General studies on the effects of increasing the minimum wage have produced widely varied results. Conservative researchers have concluded that wage increases produce higher prices, fewer jobs and a shrinking economy, and progressive researchers assert that they lift low-wage earners out of poverty and increase their buying power, thereby improving the economy.

Some business advocacy groups expressed displeasure over the District’s minimum wage plan, saying D.C. businesses are likely to move to Virginia, where the minimum wage is $7.25 an hour.

“D.C. can either have the same number of opportunities it has in the service industry right now or it can have a $15 minimum wage, but it can’t have both,” said Michael Saltsman, research director for the Employment Policies Institute.

Conservative nonprofit AR Squared sent out a scathing email blast just hours after Ms. Bowser and the D.C. Council announced the deal.

“Today’s vote that was orchestrated by big labor and the D.C. City Council is a blow to hard working employees and employers across the District,” said Jeremy Adler, communications director for AR Squared. “Because of this dramatic hike in the minimum wage, low-income workers are going to have fewer opportunities as D.C. businesses will be forced to cut back and eliminate jobs.”

But a coalition of city business owners, including Busboys and Poets restaurateur Andy Shallal, supported the $15 minimum wage measure.

“A $15 minimum wage represents a better and more sustainable way to do business,” said Mr. Shallal, who also serves as director of the mayor’s D.C. Workforce Investment Council. “It will not only provide a more livable wage to all D.C. workers but also will create a windfall for businesses that will benefit directly from the added money circulating in the community — the proverbial rising tide lifting all boats.”

Michael Lastoria, CEO and founder of the local chain &pizza, said a successful company is built on the backs of employees who are treated fairly.

“I’m all for raising the minimum wage,” Mr. Lastoria said. “The success of our company can be directly attributed to our employees feeling appreciated, engaged and supported. It’s a simple but critical concept: Allow your staff to thrive, and your company will thrive.”

Gina Schaefer, who owns several Ace Hardware stores in the District, said raising pay will help local businesses even if their payroll costs initially go up.

“Raising pay at the bottom is good for the bottom line. When you pay your employees a living wage, you are showing them that you value their work, and in return they work hard, stay with us and help us grow our customer base,” Ms. Schaefer said.

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