STATE OF
FIRST JUDICIAL DISTRICT COURT
|
NEW MEXICANS FOR FREE ENTERPRISE, THE MARK KIFFIN, MARK C. MILLER, MAURICE ZECK, PEPPERS FOOD & BEVERAGE CO., INC., PRANZO, ZUMA CORPORATION, ROBBIE DAY, JOSEPH HOBACK, and PINON GRILL AT THE HILTON OF Plaintiffs, v. CITY OF Defendant, |
Case No. D-101-CV-2003-00468 |
Memorandum of Amici Curiae Santa Fe Partnership for
Social Justice, Hispanic Roundtable of New Mexico, Somos Un Pueblo Unido, Mexican American Legal Defense & Education
Fund, New Mexico Federation of
Labor, AFL-CIO, National Education
Association-New Mexico, Democratic Party of Santa Fe County, Green Party
of Santa Fe County, Coalition for Equality in New Mexico, Hunger-Poverty Network of Northern New
Mexico, New Mexico Human Needs Coordinating Council, and New Mexico Public
Health Association
|
Jerry Todd Wertheim Jones, Snead, Wertheim &
Wentworth, P.A. Post Office Box 2228 tel. (505) 982-0011 |
|
Counsel for Amici Curiae
TABLE OF CONTENTS
TABLE OF AUTHORITIES............................................................................................................. ii
STATEMENT OF INTEREST OF AMICI....................................................................................... 1
SUMMARY OF ARGUMENT........................................................................................................ 3
ARGUMENT................................................................................................................................... 4
I. Santa Fe’s Living Wage Ordinance Is an Appropriate Measure for
Expanding Access to Family-Supporting Jobs for Working Santa Feans and Fighting
Santa Fe’s Growing Economic Inequality.................. 4
A. In Santa Fe and Many American Communities,
the High Cost of Basic Necessities Is Causing Serious Economic Hardship for the
Working Poor and Their Families..................................... 4
B. The Erosion of the Federal Minimum Wage in
Recent Decades Has Harmed the Working Poor 5
C. In Response, Cities, Counties and States
Are Stepping Forward to Enact Higher Minimum Wages to Help Local Families Meet
Basic Needs.............................................................................. 6
D. After Careful Review and Public Input,
Santa Fe Enacted Its Citywide Living Wage Ordinance with Broad Public Support.......................................................................................................... 9
II. Economic Research Indicates That Minimum Wage Laws Raise Living
Standards for Low-Income Workers Without Risking Job Loss................................................................................................. 12
A. Recent
Economic Research Has Led the Nation’s Leading Economists to Endorse Raising
the Minimum Wage............................................................................................................................... 12
B. Santa Fe
Carefully Considered the Economic Evidence in Fashioning Its Living Wage
Ordinance 14
III. Living Wage Laws Have Been Endorsed as Elements of a Sound and
Just Public Policy by a Broad Array of Civic, Religious, Anti-Poverty,
Immigrants’ Rights, Civil Rights, Labor and Political Groups in New Mexico and
Nationally........................................................................................................................................ 19
CONCLUSION............................................................................................................................. 24
APPENDIX
CASES AND
LEGISLATIVE MATERIALS
29 U.S.C. § 218(a)........................................................................................................................... 7
D.C. Stat. § 32-1001 et seq.............................................................................................................. 8
Mayor & City Council of
Santa Fe Living Wage Ordinance.............................................................................................. passim
BOOKS, ARTICLES, REPORTS AND TESTIMONY
Jared Bernstein, Increasing
the Minimum Wage: Don=t Let the Slowdown Slow
It Down (Economic Policy Institute,
Issue Brief,
Jared Bernstein & John Schmitt, Making Work Pay: The Impact of
the
1996-97 Minimum Wage Increase (Economic
Policy Institute 1998).................................... 13
Heather Boushey, Chauna Brocht, Bethney Gundersen & Jared
Bernstein,
Hardships in
(Economic
Policy Institute 2001)........................................................................................ 5,
6
Samuel Bowles,
Testimony on the Economic Impact of an Increase in the Minimum Wage (Before the
Finance Committee of the
David Card, Using
Regional Variation in Wages to Measure the Effects of
the
Federal Minimum Wage, 46 Indus. & Lab. Rel.
Rev. 22-37 (1992)............................. 13
David Card & Alan Krueger, Minimum
Wages and Employment: A Case Study of
the
........... Fast-food
Industry in
........... 90 Am. Econ. Rev. No. 5, 1397-1420 (Dec. 2000)............................................................. 13
David Card & Alan Krueger, Myth and Measurement: The New
Economics
of the
Minimum Wage (1995).................................................................................. 12, 13, 14
Jeff
Chapman, Behind the Crystal Ball: A
critique of the Employment Policies Institute’s analysis of minimum wage
proposals (Economic Policy Institute 2003).......................................................................... 18
Jeff Chapman, States Move on Minimum Wage: Federal inaction forces states to
........... raise wage floor to protect low-wage workers (Economic Policy Institute,
........... Issue Brief no. 195,
John Kenneth Galbraith,
The Good Society (1996) ......................................................................... 14
........... Consumer Society (1997).................................................................................................... 22
Karen
Kraut, Scott Klinger & Chuck Collins, Choosing the High Road:
........... Businesses
that Pay a Living Wage & Prosper (Responsible Wealth 2000)........................... 14
J.W.
Mason, Living Wage Junkonomics,
City Limits (May 2002)..................................................... 14
David A. Macpherson, The Effects of the Proposed
........... 2002-03 (Economic Policy
Institute 2003)......................................................................... 5,
6
Robert Pollin, Mark Brenner &
Consequences: Evaluating the
(Univ.
of
Robert Pollin,
Research
Inst., Research Report no. 1, 1999)...................................................................... 13
Robert Pollin, Testimony on Proposed
........... (Before the
William Spriggs & John
Schmitt, “The Minimum Wage” in
Reclaiming
Prosperity: A Blueprint for Progressive Reform (Todd
Schafer &
Jeff Faux eds., 1996)........................................................................................................... 13
State of
Labor Standards Bur., Historical Resume of Minimum Wage
Regulations in
Louis Uchitelle, A Pay
Raise=s Impact, N.Y. Times at D1 (
Jerold Waltman, The Politics of the Minimum Wage (2000)................................................................ 6
OTHER MATERIALS
Association of Community Organizations for Reform Now
(ACORN)
Deuteronomy 24:14–15 .................................................................................................................. 23
General Assembly Union of American Hebrew Congregations, Resolution on
........... Living Wage Campaigns (adopted
Jewish Council for Public Affairs, Resolution on Living Wage and Low-Income
........... Workers (adopted
Rabbi Mordechai Liebling, The Commandment for a Living Wage ................................................... 23
Pope Pius XI,
Encyclical Letter on Christian Marriage (Dec. 31, 1930) ........................................... 23
Social Principles of
the United
STATEMENT OF INTEREST OF AMICI
Amici are a diverse
array of community, religious, civic, labor, immigrants’ rights, civil rights
and advocacy organizations from
The Santa Fe
Partnership for Social Justice is a partnership of local Roman Catholic parishes
and other organizations committed to combating poverty and addressing issues of
social justice in
The Hispanic
Roundtable of New Mexico is a coalition of over 40 Hispanic community organizations
from across
Somos Un Pueblo Unido
is an advocacy group for the rights of the immigrant community in
The Mexican American
Legal Defense & Educational Fund is a national civil rights and legal
advocacy organization dedicated to ensuring that Mexican Americans and members
of all of our nation’s Latino communities have the opportunity to participate
fully in American civic and economic life.
The New Mexico
Federation of Labor, AFL-CIO is the umbrella organization of
The
National Education Association - New Mexico represents more than 6,000 teachers
and educational employees in
The
Democratic Party of Santa Fe County is a political organization that
supports candidates and issues in local, state and national elections. It is affiliated with the state and national
Democratic Party.
The
Green Party of Santa Fe County is a political organization that supports
candidates and issues in local, state and national elections. It is affiliated with the state and national
Green Party.
The
Coalition for Equality in New Mexico is a coalition of sixty-two gay,
lesbian, bisexual, transgender and allied organizations from across
The
Hunger-Poverty Network of Northern New Mexico is an advocacy group that promotes
policies to combat hunger and contribute to the economic well-being of all
persons in northern
The
New Mexico Human Needs Coordinating Council is a statewide organization of
individuals and community groups that advocate for public policies to expand
access to basic support and economic opportunity for all New Mexicans.
The
New Mexico Public Health Association is an organization representing public
health physicians and other public health professionals throughout
As a legal matter, it is not relevant that the Santa Fe Living Wage Ordinance reflects sound and compelling public policy and that the Santa Fe community and the City Council considered extensive public testimony and economic evidence for more than a year before ultimately enacting the law in February 2003. As explained in the City of Santa Fe’s motion for summary judgment, regardless of the policy wisdom of the ordinance or the evidentiary record supporting it, Santa Fe’s living wage law is a legally valid and appropriate exercise of the city’s powers under the constitution and laws of New Mexico and fully complies with all requirements of the state and federal constitutions.
Nonetheless, amici ― a diverse array of community, religious, civic, labor, immigrants’ rights, civil rights and advocacy organizations concerned about the well-being of low-income Santa Feans ― submit this memorandum to underscore the that living wage ordinance does, in fact, reflect sound and compelling public policy and is supported by far more than the mere “rational basis” required by law.
Low-income working families in
For these and other reasons, across the nation, a broad array of civic, religious, anti-poverty, immigrants’ rights, civil rights, labor and political groups have endorsed living wage laws as elements of a sound and just public policy. The twelve groups submitting this amicus memorandum are representative of the more than 1,500 local residents and major civic groups in Santa Fe and across New Mexico that came together to support Santa Fe’s decision to enact a living wage ordinance to help local working families help themselves.
I.
In recent years,
A. In
In
The crisis of the
working poor is even more pronounced in
Yet average wages in
B. The Erosion of the
Federal Minimum Wage in Recent Decades Has Harmed the Working Poor
A
significant part of the problem is the federal minimum wage. Starting in the mid-1970’s, Congress began to
allow the real value of the federal minimum wage to erode substantially. If the 1968 federal minimum wage of $1.60 per
hour had been updated to keep pace with inflation, it would be worth approximately
$8.45 per hour today in 2003 dollars.[7] Instead it stands at just $5.15 per hour — 39%
less than its real value in 1968. As a
consequence, a full-time minimum wage worker earns just $10,712 per year
― not nearly enough to meet basic needs for even one person, let alone
any children, particularly in a community as expensive as
Faced with the eroding value of the minimum wage and lack of action at the federal level, in recent years, cities, counties and states across the nation have stepped forward to enact higher minimum wages to help local families meet basic needs.
For nearly a
century, federal, state and local governments in the
Especially in recent decades as Congress has allowed the real value of the federal minimum wage to erode, state and local governments have increasingly found themselves forced to step in to ensure more adequate wage protections to help poor families support themselves. Over that period, twelve states have raised their minimum wages above the federal level.[10] And at the local level, cities and counties have increasingly chosen to exercise their regulatory authority to adopt local laws providing greater wage protections for low-wage workers. To date, more than one hundred cities and counties have enacted laws establishing wage standards higher than the current federal minimum wage of $5.15 per hour.[11]
The laws comprising this recent generation of local-level wage regulation have generally been labeled “living wage” laws in order to communicate that the higher wage levels required ― typically from $8.00 to $12.00 per hour ― are closer (though still not enough) to the pay that full-time workers need in order to support themselves and one or two children at a subsistence level.
This recent generation of municipal-level living wage laws has taken a variety of approaches in extending wage requirements to different categories of employers. Many cities have focused on firms that receive significant taxpayer-funded benefits ― for example, city service contracts, city economic development subsidies, the opportunity to lease city property, or the benefits of operating concessions at city-controlled facilities such as stadiums, convention centers, or airports. Cities have enacted legislation requiring that, in exchange for these significant publicly subsidized benefits, employers must pay their workers a living wage.
Other cities have extended local wage laws more broadly to cover most or all private employers in the city. These broader wage ordinances offer a way to help more struggling families. Yet because coverage is not linked to city contracts ― where the city’s purchasing costs may rise somewhat because of the wage requirement ― they do not involve new costs for cash-strapped city budgets.
Various cities
across the
In recent years,
more and more cities that began by enacting living wage laws for city
contractors have gone on to explore broader wage laws. This approach has proven particularly
attractive to cities like
D. After Careful Review and Public Input,
Recognizing the consensus among Santa Feans that something had to be done to address the widening economic inequality in their community, the Santa Fe City Council began a nearly two-year process of crafting a living wage ordinance tailored to local needs.
In 2002,
Persuaded that it made sense to extend the ordinance to ask more of Santa Fe’s private employers to pay a living wage, the City Council enacted a resolution accompanying the initial living wage ordinance in February 2002 establishing a “Living Wage Roundtable,” which it charged with the responsibility to “explore and develop a proposed amendment to the city code that would require a citywide living wage.”[15]
The Living Wage
Roundtable began a six-month process of extensive research, assessment and
public input, which led to the crafting, introduction and enactment of the
citywide living wage ordinance in February 2003. The Roundtable, which was composed of members
of the City Council and representatives of local businesses and workers, spent months
reviewing economic data and investigating policy options. Based on that review, the Roundtable issued a
Majority Report recommending that the initial living wage be extended to apply
as well to all larger businesses operating in
In January 2003,
the City Council introduced legislation for a new, extended living wage
ordinance based on the recommendations contained in the Roundtable’s Majority
Report. The City Council and
representatives of all segments of the
Sensitive to the concerns of small businesses and other
economically fragile employers, the Council carefully crafted and refined the
proposal so as to exempt firms with fewer than 25 workers, persons employed by
family members, certain Medicaid-funded healthcare providers for the elderly
and disabled, and certain employees such as work-study students. See
And to enable the City to monitor the impact of the
living wage ordinance, determine whether it results in any unforeseen problems,
and assess whether any changes or improvements may be appropriate, the City Council
amended the ordinance to provide for a review and evaluation process.[16] By requiring the collection of data on
On February 27,
the City Council voted seven-to-one to enact the new living wage
ordinance. When it takes effect on
Informing
Over the past decade, a mounting body of empirical economic research has found that increases in the minimum wage — even increases adopted during recessionary periods such as 1990 and 1991 — have resulted in no discernable job losses. This research began with the pioneering work of David Card and Alan Krueger, who are recognized internationally as the top economists doing statistical studies of labor markets. Card and Krueger’s 1995 book, Myth and Measurement: The New Economics of the Minimum Wage (Princeton University Press), and their related research has clarified researchers’ understanding of the degree to which minimum wage increases lead employers to cut jobs.
For their research, Card was awarded the John Bates
Clark award from the American Economics Association in 1995 ― the
so-called “junior Nobel Prize” in economics ― as the outstanding
Card and Krueger
examined the impact on fast food jobs ― one of the nation’s most low-wage
and price sensitive industries ― when
Such research has
prompted many leading American economists to adjust their analyses of the
economics of the minimum wage. For
example, Nobel laureate Robert Solow of the
Massachusetts Institute of Technology explains, “The main thing about the
research is that the evidence of job loss is weak. And the fact that the evidence is weak
suggests that the impact on jobs is small.”[20] In the words of Richard Freeman of
This body of research has demonstrated that employer demand for low-wage labor is less price-sensitive than some economists had previously believed. Economists are continuing to assess how the higher labor costs associated with raising the minimum wage are absorbed. A portion of the labor costs appear to be passed on in the form of slightly higher consumer prices for services supplied by low-wage workers ― for example, restaurant meals and hotel rooms[23] ― while some of the costs appear to come out of modestly trimmed employer profit margins.[24]
B.
In
the course of fashioning its living wage ordinance,
Among others, the City
Council was advised by Dr. Samuel Bowles of the Santa Fe Institute, Dr. Robert Pollin of the
Dr. Samuel
Bowles. Dr. Bowles, the Director
of the Economics Program at the Santa Fe Institute and an emeritus professor of
economics who has taught at
Dr. Bowles confirmed that David Card and Alan Krueger
are recognized internationally as the top economists doing statistical studies
of labor markets, and that their minimum wage research has persuaded the
nation’s leading economists that the job loss effects of minimum wage increases
are very modest. Based on Card and
Krueger’s research, Dr. Bowles projected that:
(1) the proposed Santa Fe living wage was unlikely to result in job
losses; (2) hotels and restaurants in the city would be the businesses
affected most by a living wage requirement, since they employ the largest concentrations
of low-wage workers; (3) the increased labor costs that would result from the
minimum wage would instead likely be accommodated by modest increases in the
prices charged by affected businesses; and (4) the modest price increases
would be unlikely to result in a loss of customers, most of whom are
out-of-town tourists whose decisions whether to visit Santa Fe and to patronize
local hotels and restaurants are unlikely to be affected much by marginal price
changes.
Dr. Robert Pollin. Dr. Robert Pollin,
professor of economics at the
Dr. Pollin found that the
minimum wage workers who would be helped by the proposed ordinance would be
overwhelmingly (89%) adults, predominantly (57%) Hispanic, and mostly living in
families where the low-wage worker contributes a significant share (60% on
average) of the family’s income. He
found that 60% of
As for the impact on affected businesses, Dr. Pollin concluded that (1) the research by Card and Krueger and other economic literature indicate that employers would be unlikely to cut jobs in response to a private sector living wage in Santa Fe; (2) that the industries likely to see the most significant cost increases would be hotels and restaurants in light of the concentrations of low-wage workers in those sectors; (3) that most restaurants and hotels cater to a consumer base of out-of-town tourists and can reasonably pass on much of the increased cost in the form of modest price increases without risk of losing business; and (4) that few affected businesses can be expected to relocate outside of Santa Fe to avoid the living wage, because those employing significant numbers of low-wage workers are overwhelmingly concentrated in the hotel, restaurant and other serv