PORTLAND, Maine — With a preliminary plan in mind, Mayor Michael Brennan and members of his Minimum Wage Advisory Committee want residents, business owners and workers to share opinions next month about increasing the $7.50-per-hour minimum wage in the city.
Brennan, who first convened the committee of business and labor leaders and academics in April, last week said he would like to have the City Council consider a measure to raise the minimum wage in September.
The initial increase would be to $9.50 per hour, effective Jan. 1, 2015. Ultimately, Brennan wants to see the wage rise to $10.68 per hour by Jan. 1, 2017. After the increase to $10.68 per hour, the mayor envisions tying future annual increases to the rate of inflation.
The $7.50 wage is state-mandated, along with a $3.75 minimum wage for workers earning at least $30 a month in tips. Brennan said he supports a city minimum wage without exemptions for tipped workers or nonprofit agencies.
Any ordinance introduced to the council also will get public hearings when reviewed by the committee and the full council.
For the first time, the committee on July 16 heard from someone who could directly benefit from a city-mandated wage increase, although she currently works outside the city.
Katie Ferreira, who works at the Goodwill store in South Portland, said a recent pay increase has helped her economically, but living in Portland remains expensive.
“[Nine dollars and 50 cents] is about what I make, it has made me more comfortable,” Ferreira said. “I can start making a dent in things like my student loans, I can start paying my medical bills.”
Ferreira said she shares an apartment with two roommates, and her student debt is about $15,000. She said her job is “honestly the first job I’ve worked at I completely enjoy.”
She said she is fortunate to have a relatively low amount of student debt and to be able to use public transportation to get to work.
“I feel like I have it easy in a lot of ways and I try and put myself in the shoes of a lot of people who have children,” Ferreira said.
A minimum wage that eliminates the lower “service employees” wage worried Greg Dugal, president of the Maine Restaurant Association. Dugal argued restaurants operate on very narrow profit margins, while workers relying on tips can make a good living.
“People who work as wait staff in the city are not poverty-stricken, that is for sure,” Dugal said.
He also expressed concern about a ripple effect of increased wages for those now making what would become a minimum wage.
“There is an effect all the way up to $15,” Dugal said.
Last month, DiMillo’s On the Water owner Steve DiMillo estimated it would cost him $145,000 annually to pay the increased tip wage if the city minimum is increased to $10.10 per hour.
DiMillo said half his employees rely on tips and earn as much as $27 per hour as servers and $15 per hour in support positions, such as busing tables or assisting bartenders.
Maine Women’s Lobby Executive Director Eliza Townsend and Drew Joy of the Southern Maine Workers Center said eliminating the tip wage would benefit some of the most vulnerable workers in the city.
“I am not a big fan of the minimum tip wage at all,” Townsend said, citing a recent briefing by the Washington, D.C.-based Economic Policy Institute reporting almost 13 percent of workers relying on tips are living at or below the poverty level. Women comprise 66 percent of workers relying on tip wages.
Drew Joy, chairman of the city-based Southern Maine Workers’ Center, said there is no oversight to ensure people earning the service wage actually make up the difference in tips.
“Restaurant workers are among the most exploited workers,” Joy said.
By creating a local minimum wage, Portland would join San Francisco; Santa Fe; Seattle; Cambridge, Massachusetts; and Burlington, Vermont, among other cities which mandate a minimum or “living” wage for private businesses or companies doing municipal business.
Brennan has supported establishing a minimum wage amounting to between 50 percent and 60 percent of the city median wage, which estimates place between $15.50 and $17 per hour.
He also said he keeps advice from University of Southern Maine professor Charles Colgan in mind.
“Do it in a way so your economy does not become an outlier,” Brennan said.
The Aug. 20 location for the 5:30 p.m. meeting is not set, but it will likely be at the Portland Public Library main branch or in Room 24 of City Hall.