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North Carolina: Asheville Expands 'Living Wage' Rules
Asheville Citizen Times
Joel Burgess

March 23, 2011
View the Original Article

Many contractors doing business with the city will now have to pay employees a “living wage,” making it one of only two cities in the state to set standards higher than the minimum wage for private businesses.

The City Council voted 4-2 Tuesday to require businesses with city contracts between $30,000 and $90,000 to pay employees a minimum of $9.85 an hour with health insurance benefits or $11.35 without benefits.

Voting yes were Vice Mayor Brownie Newman and council members Cecil Bothwell, Esther Manheimer and Gordon Smith. Councilmen Jan Davis and Bill Russell voted no.

The federal and state minimum wage is $7.25.

The rule would apply only to businesses working through the city's “general services” division, which includes contracts such as mowing or parking garage security. Construction workers, surveyors and other “professional service” contractors are not subject to the rule.

Living wage advocates said Wednesday that city residents should be proud that full-time contract employees will be paid enough to live without public or private assistance.

“It's just to meet your basic needs. We're not talking about luxuries. We're talking about being able to put a roof over your head and food on your table,” said Vicki Meath, director of the nonprofit Just Economics.

The living wage comes from U.S. Department of Housing and Urban Development rent figures for Buncombe County. It is calculated so people do not have to spend more than a third of monthly income on rent. Locally, the number was based on a one-bedroom apartment renting for $560 a month for one person.

The rule is an extension of a 2007 ordinance when the council voted to ensure that city employees were paid a living wage. The new rule does not include businesses with a current contract.

Durham is the only other city in the state to pay a living wage to employees and contractors, according to the nonprofit National Employment Law Project. Among counties, Durham is the only one to have a living wage rule, but that applies only to county employees, living wage advocates said.

Extending the measure to contactors is important because most municipal employees already meet living-wage standards, said NELP spokesman Paul Sonn.

“The main focus has been on privatized, outsourced labor,” Sonn said.

The majority of council members said the new rule closes a loophole in the city's living wage ordinance.

“If we contract below the living wage, we are really playing a shell game. We are pretending to be a living-wage employer, but we are doing some low-wage work on the side,” Bothwell said.

Russell, though, said the rule interferes unnecessarily with market forces.

“The lesson I learned in economics is supply and demand, and regarding labor, this goes against one of the basic rules I've learned,” the councilman said.

City staff did not know exactly how many contractors would be affected by the change, but Lauren Bradley, Asheville director of administrative services, said research showed there should be only a 1 percent increase in cost for the local government.

With its vote, the council said it wanted to revisit the rule annually and to look at increasing its reach to affect contracts of more than $90,000.