By Don McIntosh, Associate editor
The Oregon Legislature passed the largest set of minimum wage increases Oregon has ever seen last month, putting the state on track to have the highest minimum wage in the nation. Under the new law passed by the Democratic majority and signed March 2 by Gov. Kate Brown, the minimum wage will rise by 2022 to $14.75 in the Portland area, $13.50 in Northwest Oregon plus Jackson and Josephine counties, and $12.50 in sparsely populated Eastern and Southern Oregon. At that point even Oregon’s lowest rate — in areas comprising 10 percent of the state’s population — will be higher than any other state’s minimum wage. Oregon’s highest rate will cover not just Portland but all 25 cities within the Metro urban growth boundary, totaling 38 percent of the state population.
The raises will have a big impact on Oregon workers. According to the Oregon Employment Department, a third of the Oregon workforce — 618,000 workers — currently earn less than $13.50 an hour, and 100,000 workers earn exactly the state’s current $9.25 minimum wage. All of those workers can expect raises. The first increase takes place July 1, followed by annual increases until 2022, after which the wage will rise based on the rate of inflation. By 2022, full-time Portland-area minimum wage workers will be earning $11,440 a year more than they do today.
The minimum wage measure, Senate Bill 1532, passed 16-12 in the Senate and 32-26 in the House, but not a single Republican voted for it. The only Democrats to vote against it were state Sen. Betsy Johnson of Clatskanie and state Reps. John Lively of Springfield and Caddy McKeown of Coos Bay.
Increasing the minimum wage has always been broadly popular with the public, but the Oregon Legislature hadn’t voted to increase the minimum wage since 1989. Instead it took union-backed ballot measures — in 1996 and 2002 — to raise the wage. This year, the prospect of two more such measures aimed at the 2016 ballot were a big factor pushing the Legislature to act. One ballot measure proposed to raise the wage to $15 within three years, and the other to $13.50 — while lifting a pre-emption on local jurisdictions going higher than that.
In December, Gov. Brown brought stakeholders including business groups and the Oregon AFL-CIO together for private meetings to work out a compromise measure she would propose to the Legislature. Brown’s proposal had two tiers. Lawmakers later amended it to create three tiers, but resisted other changes that would have watered it down, including proposals for a lower wage for farm workers, tipped workers, and young workers.
In the wake of the Legislature’s passage of SB 1532, both of the ballot measure campaigns announced the suspension of further efforts to gather signatures. Raise the Wage (the coalition behind the $13.50 measure) thanked the governor for leadership on the issue. 15 Now (the coalition behind the $15 measure) was more critical, saying her motive was to undercut and eliminate the grassroots minimum wage movement. But both campaigns also acknowledged the historic significance of the increase.
The bill got national attention. Oregon is the first state to pass a law mandating different minimum wage rates for different parts of the state — an approach that takes into account different costs of living and different kinds of labor markets. Oregon AFL-CIO political director Graham Trainor says his counterparts in Washington and California have been calling to talk about out how they can pull off something similar.
The 2016 legislative session will be remembered for its historic increase in the minimum wage, but lawmakers dealt with many other issues of interest to working people as well.
If there’s a shadow on the minimum wage increase, it’s that much of the additional wages may go right back out of workers’ pockets in the form of rent. The first raises, for example, amount to $86 a month in Portland, but Portland-area rents have risen on average $100 in the past year.
Rents are shooting up in all of Oregon’s urban areas, and Portland rents are going up faster than anywhere else in the United States. But landlords and developers are used to getting their way in the Oregon Legislature. Back in 1999, they got lawmakers to ban “inclusionary zoning” — a tool used by cities in other states to create more affordable housing by mandating that developers make a certain percentage of new units affordable if they want approval to build. Affordable housing advocates, with support from some unions, last year pushed to repeal that ban, but the effort died in the Oregon Senate. They tried again this year, with a proposal to let cities require up to 30 percent of new units be affordable to those making at or below 60 percent of the median family income. What emerged instead was a heavily watered down version. Basically it keeps the ban in place, but creates a narrow exception: Cities may mandate that no more than 20 percent of units be affordable, and only in multi-family housing developments with 20 units or more. And the definition of “affordable” might surprise you — affordable to those making up to 80 percent of the median family income ($58,800). That’s not all: The mandate is only allowed if the city gives developers some incentive or payment, and developers can opt out of the mandate by paying a fee. The measure also allows cities to levy up a construction tax of up to 1 percent for affordable housing, but directs that 85 percent of that go toward incentives for developers. And the Metro regional government is barred from being able to levy that tax.
Housing advocates and unions did help pass another renter protection however: HB 4143, the Renter Protection Bill, bars rent increases in the first year of a month-to-month rental, and requires landlords to give 90 days notice of rent increases.
If cheating people out of wages is against the law, you might not think it would be so hard to get the Oregon Legislature to insist on robust enforcement. But efforts in recent years to crack down on wage theft have failed to win passage.
The good news is that this year, lawmakers are increasing the number of wage and hour investigators by 45 percent. The bad news is: That’s only 3 individuals, bringing the total to 10 to enforce the law for all workers in Oregon. SB 1587 also makes prevailing wage violations a Class C felony, and allows the Oregon Bureau of Labor and Industries to refer cases to district attorneys for prosecution. It also supposedly requires employers to provide pay stubs to workers which itemize pay rates, hours worked, payroll deductions and other standard information. But the law lays out no penalty when employers fail to do so.
Minimum wage SB 1532 raises the wage over seven years to $12.50, $13.50 and $14.75 in different regions.
Unemployment insurance HB 4086 extends benefits an additional six months for workers locked out by their employer in a labor dispute. SB 1544 extends UI benefits for workers in apprenticeship programs.
Wage theft SB 1587 adds three wage and hour investigators, makes certain prevailing wage violations a Class C felony, and requires employers to provide pay stubs and keep payroll records for three years.
Affordable housing HB 4143 prohibits rent increases during the first year of month-to-month tenancies and requires 90-day notice for increases after one year. SB 1533 makes limited exceptions to a ban on inclusionary zoning and ends a state ban on construction excise taxes.
Construction Jobs HB 5203 approves $30 million in bond funding for partial renovation of the Capitol building.
Global warming SB 1547 requires PGE and Pacific Power to end the use of coal to generate Oregon electricity by 2030, and get 50 percent of their electricity from wind and solar by 2040.