Palo Alto joined a regional trend Tuesday when a City Council committee endorsed a minimum wage of $15 per hour starting in 2018.
The proposal, which the Policy and Services Committee unanimously approved, would transform Palo Alto from a city that has no minimum-wage law to one that would have one of the highest minimum-wage requirements in the nation.
If the full City Council goes along with the recommendation, minimum wage in Palo Alto would rise to $11 per hour on Jan. 1, 2016. It would then gradually climb to $15 by 2018 through increments that would be approved annually by the council.
By endorsing the "15 by '18" plateau, Palo Alto is following in the footsteps of its neighbor Mountain View and early adopter Seattle. In Mountain View, the minimum wage was set last year at $10.30 per hour, though more recently that city's council has been talking about adjusting it to $15 over the next three years.
The Palo Alto committee's support for a local minimum-wage ordinance was never in doubt. The city currently has no such law; employers are only bound to the state standard of $9 per hour, which is set to rise to $10 next year. Four council members -- Marc Berman, Pat Burt, Tom DuBois, Cory Wolbach -- penned a memo earlier this year urging an adoption of a local minimum-wage law. The same four members also coincidentally make up the Policy and Services Committee.
About a dozen residents, including clergy members and low-wage earners, made a case for the change early in Tuesday night's meeting and pointed out that eking out a living in Palo Alto is nearly impossible for those earning anything close to the minimum wage.
Qiao Li earns $12.81 per hour as a caretaker to a local senior, but he now believes he will need a second job just to retain his Palo Alto studio. His rent recently jumped from $800 to $1,500 a month, and living in the famously unaffordable city is becoming increasingly challenging.
"It is very, very difficult, and I don't have any quality of life at all," Li told the committee.
Lacey Lutes, who works in Palo Alto as a utilities account representative, said she had to work two minimum-wage jobs while in college to make ends meet.
"At times I had to make tough decisions between picking up another shift and working or studying and doing homework," Lutes said. "I always chose the shifts so that I can eat that night."
The proposal that the committee ultimately rallied around was far more ambitious than the one outlined by staff in a report. The proposed ordinance would have raised minimum wage to $10.30 and adjusted it annually based on the Consumer Price Index. The ordinance would follow similar laws that were adopted last year by Mountain View and Sunnyvale and in 2012 by San Jose.
But the four council members ultimately agreed to go further than this proposal, both in the near- and the long-term. Wolbach offered the most ambitious plan, one that would set the minimum wage at $11.50 in January. His colleagues didn't want to go that far and settled on $11.
Burt and Berman both stressed the importance of giving businesses adequate warning and time to prepare for the new laws.
"I support the minimum-wage increase, but I also think it's vitally important that our business community is informed as is part of the dialogue in terms of the details of it," Berman said. "People are going to have differences of opinion on it and everyone should be heard."
About 30 people attended the Tuesday night hearing, with almost everyone speaking favored a higher minimum wage.
"Find a way to get to $15 per hour sooner rather than later so that the people who are the lowest wage earners in our community can live more sustainably in our community," said Rev. Eileen Altman of First Congregational Church of Palo Alto.
Randall Jones was one of about a dozen members of the public who held up a "We need a path to $15" sign.
"I have a lot of sympathy for small-business owners," Jones said. "I want to point out, there are no retail owners who are living in their cars, no restaurant owners getting food stamps because they're not making enough money to pay for food, no small business owners living in an apartment with another family. Most business owners aren't having to get Medi-Cal to get medical care, or go without any medical care whatsoever."
But the committee agreed that rushing toward a minimum wage wouldn't be fair to local businesses.
"As much as we'd like to see these dollars in the hands of workers sooner, I really think to have a major change to businesses, even a moderate change like this financially, there should be some adequate forewarning," Burt said. "Not all (businesses) are rolling in the dough. I think it's responsible to give them at least a six-month warning."
After Wolbach's proposal to set the minimum wage at $11.50 per hour failed, DuBois made a motion to set it at $11 per hour starting Jan. 1, 2016, with annual adjustments based on the Consumer Price Index. DuBois' proposal also included a goal of $15 per hour by 2018. Staff will return to the committee no later than Oct. 1 to discuss the process for reaching this goal.
DuBois also said he'd like to see Palo Alto's minimum-wage increases considered in conjunction with similar efforts in other cities.
"I see a lot of value to match up with surrounding communities," DuBois said.