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Council Votes in Favor of Living Wage Ordinance

San Diego city council last night voted 5 to 4 in favor of a Living Wage Ordinance that would raise the minimum wage for some companies contracted by the city. Critics say the decision sends the wrong

San Diego city council last night voted 5 to 4 in favor of a Living Wage Ordinance that would raise the minimum wage for some companies contracted by the city. Critics say the decision sends the wrong message at a time when the city is in financial crisis. But it was a triumph for dozens of workers’ rights groups that have lobbied for the Ordinance for more than three years. KPBS reporter Alison St John has more.

Demonstrators chanted outside city hall before the council meeting. Dozens of labor groups and church leaders from several denominations gathered to sing songs, cheer and pray, before filing into Golden Hall.

They were there to support the Living Wage Ordinance , a proposal to pay workers contracted by the city a minimum of $12 an hour, or $10 an hour plus $2 an hour for health insurance.

At a time when the city of San Diego has a billion dollar pension deficit and is facing a $50 million shortfall in next year’s budget, the Ordinance was considered by many to be a long shot.

Jesse Knight, President of the San Diego Chamber of Commerce was one of more than two dozen people to testify against it.

Knight : This issue has been billed as business versus labor but this is really about looking at the harsh realities that we as a community are being forced to acknowledge with regard to our current economic crisis -- it is about looking at the facts and making the appropriate fiscal decision.

The City manager’s preliminary estimates suggest the ordinance could cost the city between $3 and $7 million a year. Private business that contract with the city will have to pay their workers more and would pass the costs on to the city.

A pro-labor group, the Center for Policy Initiatives, put the cost to the city at less than $2 million a year. But either way, the opponents pointed out the timing was terrible and adopting the pay increase would send the wrong message to observers watching carefully to see how the city deals with its fiscal mess.

However, more than 50 people signed up to speak for the ordinance. Some business leaders argued the city is rewarding bad employers, and penalizing good ones by contracting with the lowest bidder. They pointed out that the taxpayer has to pick up the tab on social services when low paid employees can’t pay for health care or a decent home for their families.

They said the city managers’ report ignored the positive consequences of the ordinance -- paying people a living wage allows them to spend on goods and services, benefiting the economy.

In the end, Councilwoman Toni Atkins, who championed the issue, said it exposed how people in power have lost touch with those at the bottom of the economic ladder.

Atkins : You know, I know what it like to work in hotels, clean house, pump gas and I’m really glad for those experiences because today it was real clear to me listening to some of the opponents that they don’t know what it’s like to do some of those jobs.

Councilwoman Donna Frye gave examples of the millions the council spends on consultants and their administrative assistants without of batting an eye.

Frye : Another: this is a sub-consultant for clerical at 55 dollars-an-hour. No one has said a word about it, not one word, no one has come down here and said the city is spending too much on hourly salaries.

But the swing vote was Anthony Young. Elected just months ago, to replace Charles Lewis who died unexpectedly, no one was quite sure which way he’s lean.

Young : So I ask myself: is the question an increase to our city budget that is less than 1% worth improving the quality of life of thousands of families and improving the quality of life of the city as a whole and I would have to say yes.

But Young said he reserves the right to rescind the ordinance if future information shows the city simply cannot afford it. The fact that it will not take effect in the next fiscal year and will be phased in over the next three years made it more palatable to the other two councilmembers to support it: Michael Zucchet and Ralph Inzunza.

Mayor Murphy regretted the timing of the decision and said it will send the wrong message to the financial markets that are already concerned about the state of the city’s shaky finances. But he praised the faith community for throwing their passion into the cause.

Speaking from her car on the way home after the vote, Rabbi Lori Cosky, Head of the Interfaith Committee for Worker Justice, predicted the council will come around to the idea in time.

Cosky : Three years from now maybe even the ones who didn’t vote for it will own it, or five years from now when we see that we have treated the workers justly and that the city has regained its strength and vigor, they’ll see that this was a just and fair thing to do and the impact on the city was only for the good.

While labor advocates applaud the council’s move, Ernie Hahn of the I pay One Center formerly the Sports Arena, says the extra labor costs could cripple his business. The real consequences will emerge over the next few years.

Alison St John, KPBS News.

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