Voters Approve Props To Immediately Boost Minimum Wage And Divert Tax Revenue For Infrastructure
San Diego voters overwhelmingly supported two propositions on Tuesday’s ballot. Prop I, which immediately raises the minimum wage to $10.50/hour, received 63.22% of votes; 64.6% of voters supported Prop H, which calls for setting aside a portion of the city’s sales tax revenue and pension savings to improve infrastructure.
The new San Diego wage law could potentially raise the city's minimum wage beyond the state’s new minimum wage law, which will raise the minimum wage from $10/hour to $15/hour by 2022, reports the San Diego Union-Tribune. SD's minimum wage will go to $11.50/hour on Jan. 1, 2017, then will escalate in step with the federal price index beginning Jan. 1, 2019. The measure also mandates 40 hours of paid sick leave annually. The state law allows the governor to suspend scheduled minimum wage increases during economic downturns, but SD’s new wage law does not.
The minimum wage measure was opposed by business groups, as well as SD Republican Mayor Kevin Faulconer (pictured above), who vetoed the initial effort to put the measure on the ballot. All six city council Democrats overrode the mayor’s veto, a move applauded by organized labor. SD’s chamber of commerce collected enough signatures on a petition to place the initiative on Tuesday’s ballot, hoping voters would reject it.
Opponents say the higher wage floor, which will raise costs for the city’s employers above employers in nearby cities, will eliminate many entry-level jobs. Supporters contend the minimum wage boost will benefit businesses by increasing spending and is needed to provide workers a livable base wage. A large body of research by academic institutions suggests the impact of California’s minimum wage law overall puts the state in uncharted territory, noted the San Diego Union-Tribune article.
Passage of Prop H will divert 50% of growth in certain tax revenue sources to a fund, beginning in 2018 and running through 2043, setting aside an estimated $3B for repair of streets, sidewalks, public buildings and other hard public assets. Even so, city officials say this still falls short of the funding needed to cover SD’s backlog and projected future infrastructure needs during this period, reports the Union-Tribune. The city council can suspend this measure for a year at a time with a two-thirds vote during times of fiscal need, according to an analysis by the city attorney.
Supporters, including Republican Councilmember Mark Kersey (snapped here during an interview with University of San Diego journalism student Juwan Armstrong) and the build industry, say Prop H forces the city to view development and maintenance of buildings and infrastructure as a core function of local government. Opponents contend the measure doesn’t raise enough money to solve the city’s infrastructure woes and may deprive city government of funds for more urgent needs. [SDUT]
