The New Mexican
Julie Ann Grimm
Instead of hiking the minimum wage in the city limits according to a corresponding increase in a federal statistic, apparently nobody at City Hall did the calculations last year.
That meant that the much trumpeted "living wage" for the city remained at $9.85 when it should have been higher.
"We didn't check it as carefully as we should have," Mayor David Coss said Tuesday. He said he wasn't aware of the problem until The New Mexican asked about it.
"I think that last year we presumed that the [Consumer Price Index] was not rising because of the economic situation when in fact we should have checked more closely because it did go up a little bit. We were focused on the economy and on the city's budget issues."
Last year's shortcoming could also mean businesses feel more of a sting as the wage floor is readjusted for 2012. Although the calendar year has one month to go, indicators are that the year-end Consumer Price Index will show as much as a 3 percent increase, which would trigger a wage hike of about 30 cents in the spring.
When the Santa Fe City Council voted in 2003 to establish a minimum wage of $8.50, the city ordinance came with a built-in timeline for scaled increases.
After the minimum wage rose to $9.50, officials amended rules so that future increases would only happen when there was a corresponding uptick in the Consumer Price Index for the West Region — a statistic compiled by the U.S. Bureau of Labor Statistics.
In 2009, city administrators such as the Finance Department director, attorney and staff in the Economic Development Division looked at year-end averages for the 2008 index, as it applies to urban wage earners as prescribed in the ordinance, and increased the city's minimum wage to $9.85.
The next year, the index dropped by .07 percent. Since the city ordinance only allows for upward adjustments, the wage remained unchanged.
Last year, however, it appears no one evaluated whether the wage should increase. Even though the federal index went up by 1.4 percent, the city did not recalculate the minimum wage.
The City Clerk's Office did not immediately respond to a request for public records made last week that sought information about the decision-making process at the time. Coss said that's likely because it appears few discussions occurred.
"I know I never even asked staff about it," said the mayor, who played a major role in the implementation of the original rules as a city councilor and in the later compromise about increases. "I just presumed that it was flat."
Another question that remains unanswered is whether the city should have increased the wage for this year by the gross increase of 1.4 percent or the net effective increase over the prior year of .07 percent.
Coss said he hopes that in future years, the calculation is based on the simple year-over-year percentage increase in the Consumer Price Index, if there is one.
Jan McClanahan, owner of Santa Fe Discount Tile and Carpet, said she hadn't noticed that the city didn't increase the minimum wage last year and expects she can comply with next year's potential increase for her three part-time employees.
"Financially, store-wise, it would hurt," she said. "But then again, they gotta live, too, and everything else has gone up. You've got to weigh out the both. In order to have good employees and well-fed employees, you've got to pay them. I wish I could pay them more."
McClanahan has also tried to help workers by awarding bonuses when the business has a good month and said she'd rather be able to make those decisions in response to the market.
At Luna Laundry, a south-side business that caters to hotels and other industrial laundry users, several employees will get raises under the new rules. Since most of the overhead for owner Scott Ciener comes in the form of labor costs, however, he knows it will change the bottom line.
"It's hard because it will increase my cost a lot," he said, but noted that for him, a minimum-wage increase can also be good news.
"When a hotel gets hit with that increase and they see it hotelwide and I tell them that I can do your laundry cheaper than you can, and you don't have to pay those employees at all, that gets me customers," he said, adding later that he knew future increases were possible.
"That's part of what everyone in Santa Fe has to deal with," he said.