Portland will hold public hearing on proposed increase in the minimum wage

Portland City Hall exterior on a rainy day

File photo / Renee Cordes Portland City Hall

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Portland City Council will hold a public hearing on Monday, Aug. 25, on a controversial proposed hike to the city’s minimum wage.

The proposal would increase the minimum wage from $15.50 per hour to $20 per hour within four years.

The meeting is set for 4 p.m. on Monday.

The Council’s four-member Housing and Economic Development Committee recommended that the increase be adopted and phased in over three years. The $20 per hour rate would be reached by 2029.

The effect of the wage hike on the city's payroll — for 2,000-plus employees — is estimated to be between $3.1 and $3.6 million annually for each year of the increases, which would require an additional $10.1 million in property taxes to be collected between 2026 through 2029, according to a report prepared in May by Brendan O’Connell, the city finance director.

The proposal does not include a wage hike for tipped workers who are currently paid an hourly wage of $7.75, but employers are required to ensure that wages and tips combined total $15.50 per hour.

Pious Ali, who chairs the Housing and Economic Development Committee, has put forth an amendment that would exempt employers with 50 or fewer employees.

The statewide hourly minimum wage is $14.65.

Business response

The last city wage hike was approved by voters in November 2020, effective January 2022, and cannot be adjusted within five years except by another referendum. If approved by voters, the increase would become effective January 1, 2026.

The issue of sending the decision directly to voters is of concern to at least one Portland business owner, David Turin, who owns David’s Restaurant in Monument Square.

At a virtual press conference held by Portland’s Regional Chamber on Aug. 20, Turin said that in addition to being opposed to the wage increase, he sees a real downside to taking the question to voters directly.

“Governing by referendum is demonstrably bad,” Turin said. “It puts a lot of people in the voting booth who don’t have the time or ability to fully understand the referendum.

“Council could do this through discussion and vote and pass it without referendum. It’s passing on the responsibility that you took on when you decided to be a city councilor. They’re abdicating their responsibility as a public official by passing it onto the voters.”

Turin said he employs 55 to 65 people, three-quarters of whom are full-time, and predicted that a wage hike would cost his business $40,000 to $50,000 a year.

“Restaurants in Portland are already operating on razor thin margins with inflation and raises that have already happened,” Turin said, adding that labor is his single biggest cost.

“I can’t control my rent, utilities, insurance. The only variable costs I have are labor and food and beverage, and it’s very hard to cut those, with inflation.”

Turin predicted Portland restaurants would be forced to raise costs, which would most likely drive diners to neighboring towns.

He also said businesses will be forced to cut employees, which will increase homelessness. “The lowest level workers will be the first to be cut; the marginalized worker with low skill sets are the first people to be hurt, and they’re already scraping to get by.”

Figures from the Chamber show that 45 hospitality businesses in Portland closed in the past year and a half.

Another participant in the Chamber's virtual press conference was Tamara Gallagher, who runs Growing Tree Childcare in Portland. She said if the wage increase passes, her business would be unable to remain in the city.

Gallagher said her enrollment has already experienced a decrease from 75 children to 50, since 2020, because families can't afford it, and the subsidy programs have a one-year waiting list.

"So we can't go up in our rates; we can't charge families enough to cover those increased costs. Many child care businesses have been closing," Gallagher said. "There's no federal or state funding to help us.

"We're not advocating for non-higher wages, but a $20 minimum wage, means someone already making $20 an hour would have to be paid more. I cannot charge our families more."

Quincy Hentzel, president and CEO of the Chamber, said during the briefing that the hike would mean Portland would have nearly the highest minimum wage in the country, “second only to two towns near Seattle.”

Mainebiz reported on the March 18 public hearing on the proposal held by the HEDC, and that story can be viewed here.

On July 17, the Council’s Finance Committee also held a public hearing on the proposal.

More information

The full agenda for Monday’s meeting which begins at 4 p.m., along with back up documents and the link to view the meeting over Zoom, are on the Council meeting page on the city website.