Measure D: Add It to the Tab

The new minimum wage law, Measure D, will take effect March 11, 2013. The increase in pay to $10 per hour represents a 38 percent increase, when including employer matching payroll taxes.

Back in November, the voters overwhelmingly supported Measure D. Many business owners I have spoken with plan to cover the increase in payroll costs by raising prices, reducing the hours of current employees and, in some case, simply eliminating positions altogether.

Given these circumstances, my suggestion to business owners is that they should consider adding a surcharge to each customer’s bill. This line item should be clearly spelled out, and appropriately called “San Jose Minimum Wage 2012.” This is similar to what is being done today in San Francisco, where a “Healthy San Francisco Surcharge” is added to restaurant bills. This fee goes towards the cost of providing health care to employees as mandated by San Francisco County. When city specific fees—such as Measure D—are clearly stipulated on an invoice, it removes any ambiguity as to why prices are higher in San Jose than in neighboring cities.

It is possible that some voters may have underestimated the negative impact that the passage of Measure D will have on the service industry, and in some cases, on these same voter’s personal pocketbooks. It is my hope that when business owners DO raise their prices, all those that voted for Measure D will continue to support these businesses without a second thought, despite the higher prices attributable to the wage increase. After all, voters should take pride in their affirmative vote, and paying the surcharge allows them to show the strength of their conviction.

It has often been said that there is no better barometer to how people feel than their wallet. If paying 10 cents for a paper bag caused a stir, then a substantially higher surcharge for a minimum wage increase will most certainly create a vigorous debate. As a result of this debate, residents and business owners may decide to repeal Measure D due to the previously unforeseen impact on consumer prices, employment and tax revenues lost to other cities.

Alternatively, we may find ourselves more unified in the belief that increasing the minimum wage was the right thing to do. Either way, my hope is that all business that are impacted will add the minimum wage surcharge to all receipts next month, in the form of a clearly defined line item.

Pierluigi Oliverio is a councilmember for San Jose’s District 6.

19 Comments

  1. Instead of “underestimating” the hypothetical “negative impact” on businesses, perhaps the overwhelming majority of voters who approved Measure D were considering the tens of thousands of low wage workers who can’t afford to make ends meet in this city.  Perhaps the voters were considering the millions in public assistance that’s spent on low wage workers who can’t make it on $8 an hour.

    Instead of sarcastically berating your constituents, Mr. Oliverio,for trying to do the right thing, you should be congratulating them and finding positive ways to support local businesses.

  2. What doesn’t make any sense with me- is that we’re paying a few cents less for a hamburger and fries which aren’t very good for us, but ending up paying large sums through social safety net programs.

    There’s definitely a role for good public policy that helps out workers who are low income- and so in the end there’s no reason that the cost of goods in say that/ or any industry shouldn’t be a true reflection of the actual cost of living.

  3. About that 10 cent bag surcharge, wasn’t one of the reasons given for SJ “needing” this was the extra costs that recycling companies were bearing when the plastic bags were getting stuck in their equipment?  The banning of plastic bags was going to bring down their operating costs right?  So why hasn’t the public seen a reduction in our garbage bill?  Why hasn’t the recycling companies given the public our share of that savings they’re reaping that was laid upon them by the City Council at the expense of the general public?

    • The ordinance began on January 1, 2012, so it’s very likely it hasn’t been in effect long enough to be showing it’s usefulness unless, of course, you can cite a report or some data that proves our garbage bills should be lowered after just one year.

  4. Line items are great for transparency, a staple of the Mercury News and Rufus Mayoral campaign.

    I propose that when SJPD provides crime report receipts (case numbers) to a victim, they can place an asterisk if the issue could have been avoided by a fully staffed and funded PD.

    Hey Pier, can you chat a bit more about the 2/3’s of the City Budget ($1 Billion) that isn’t the General Fund?

    • Got it right.  I suggest in the next city bill to residents you take a page from the IPA and enclose a note stating,  “Sorry if you were a victim of a burglary, car theft, etc.  Because of Measure B were are no longer able to come to your house and investigate your loss.”  Best wishes, San Jose Police Department.

      Because the clown council put this up for a vote we no longer have enough police officers to investigate gang violence, graffiti, burglaries, well most crimes in general.

      But I did spend almost 38K on my free city credit card, thanks for voting for me and all the other council members who spent almost 230K on our free credit cards last year which you all pay for.  I won’t go into our free cars, gas, and cell phones. I will save that for another post.

      Go libraries.

  5. Unintended consequences! My assumption is that those who voted for Measure D, thought that employers were going to raise employees wages and cut their own profit margin! Why do librals live in a ‘utopian’ world and see things through rose colored glasses!? Wake up and get back to reality and start paying more for all services commencing March 11!

    • OK, I’ll get back to reality when you step into it. First things first. Stop patronizing local businesses. Do all of your shopping at Costco, Target, Best Buy. Everything big box; nothing small business; and certainly nothing family owned and operated. Secondly, stop taking yourself and/or your family and friends out to meals in any restaurant here in San Jose. Just stop altogether! Why bother, right? Having meals out that help support our local businesses and thereby the employees working multiple jobs to make ends meet in San Jose don’t deserve it.

  6. Line Item isn’t too bad of an idea… although some better suggestions for the actual name of this line item:
    “Feed My Family”
    “We don’t runaway with the profits”
    “Robin Hood Surcharge”

    Also, will this same sort of accountability be a line item when Measure B is overturned? Or, will it all just be swept under the rug and ignored?

  7. Perhaps, if time and money is to be spent on a campaign initiative, then we can float one to reallocate the City revenue from Special/Capital to General Fund.

    It’s absolutely ridiculous that 2/3’s of the taxpayer’s money is not spent on core services.  The perpetual funding of unnecessary things, from golf courses all the way to SJC (and in between) costs about $750 million.  So while Rufus cries of fiscal emergency, you do not adequately pay for Police/Fire/Streets/Sewer services.  You blame employees pay and benefits.  But, you do not ever, even once tell your constituents that that these pet projects are fully funded- in your eyes they are untouchable.  Shame on you City Council and so-called leaders… Shame!

    I have no problem with the airport, the golf courses, the Hayes mansion and all that extraneous mess being short-sold or foreclosed on. If you elected clowns are serious about fiscal responsibility then you’d have done it already!

  8. Is there any chance that Measure D will be rescinded?

    Trying to stir up trouble or rooting for Measure D to be a failure is counterproductive.  It makes you look small.

    • Stand talk, Sir Randall when Measure B is overturned and cost the cities millions.  But then the money is going to Chucks lawyer friends so no worries.

  9. Pier,

    I think you have sunk to a new low on this idea. Do you really think it is necessary to add a “line item” with no other purpose than to stir up bad feelings about some kid trying to work? That seems pretty petty on your part. You can’t have it both ways with the voters; the same voters that you said gave an overwhelming mandate for pension issues is the same voters who approved raising the minimum wage. Are you saying that these voters were educated in one issue but not the other? Pier, you seem like someone who has really forgotten your often trumpeted humble beginnings as a paper boy and bartender. Forget about your idea of printing on every receipt a reminder of the evil kid who just took money out of your pocket, or do you really have a desire to vilify them too?

    • observation makes a GREAT POINT here.

      I only wanted to add that I don’t think we can afford to write off minimum wage jobs anymore as simply a sector that offers transitional jobs for teenagers. Increasingly working families are depending on these jobs.

      The Bureau of Labor Statistics estimates that 7-out-of-10 growth occupations over the next decade will be low-wage fields. And these jobs are not being done by teenagers. Across the country, the median age of fast-food workers is over 28, and women—who make up 2/3rds of the industry—are over 32, according to the BLS.

  10. Because college students shouldn’t have to use public transportation or share an apartment with 5 other room-mates and learn how to respect people in small spaces, or learn how to budget their money by eating meals cooked in the home that are basic and not the ultimate expression of culinary finesse.  Vote yes on Measure D.  What a mess.

    Increased prices result in less revenue for the business which means less taxes for the city duh.

    Less business means businesses close which means less revenue for the city.  Duh.

    I recommend that all service industry owners switch their employees to independent contractor status.

    • (begin quote)
      Because college students shouldn’t have to use public transportation or share an apartment with 5 other room-mates and learn how to respect people in small spaces, or learn how to budget their money by eating meals cooked in the home that are basic and not the ultimate expression of culinary finesse.
      (end quote)

      No, it is because doing all that is not sufficient at $8/hour. The floor has become too low. Prices have risen and the minimum wage needs to raise with them. The fact that the it raises the minimum wage each year with inflation is one of the best aspects of Measure D. That should be the case with the federal minimum wage as well.

      The minimum wage should result in a single person being able to maintain a roof over their head and being able to buy food (fast food) every day. I’m not suggesting the minimum wage should support a family of five. Someone who wants that needs to keep looking for a better job. But the wage floor should be just that, a wage floor. Floors support people and allow them to stand up, and protect them from the dangers beneath.

      As I said in another post, not everyone who works for the minimum wage is without skill or of bad character. I have an honorable discharge from the United States Navy where I worked as a sonar technician on submarines. I also have a CompTIA A+ Certification, an industry standard credential verifying that I know how to fix a desktop computer. I’m also in college on the Post 9/11 GI Bill, which pays 60% of my tuition (I was in the USN for 18 months after 9/11) and a housing assistance payment, but only while I’m actually taking classes (typically not enough courses are offered over the summer for example).

      I take public transit because I don’t know to drive (I didn’t learn in high school) and I can’t afford a car anyway.

      I have two roommates and I still struggle to make rent when I’m not getting the GI Bill housing assistance. I’ve applied to Best Buy etc. (BB hires computer techs), but as I said, jobs aren’t falling off trees right now.

      So, we need to fix the floor, it is too low, that’s why we voted for Measure D.

      By the way, it is illegal to put people on independent contractor status if they do not genuinely qualify for that status. So if you did that you are making yourself vulnerable to a lawsuit as well as direct action from the IRS etc.