San Jose’s City Council may weaken an ordinance that guarantees a living wage to anyone working for a private tenant of a city-owned property. The 16-year-old living wage policy requires commercial and other private tenants on city leases to pay above the minimum wage, at least $15.78 an hour with benefits or $17.03 without.
But a motion going before the City Council on Tuesday wants to exempt lessees without direct service contracts with the city, arguing that the change actually clarifies the existing policy. The policy states that the living wage standard applies to service and labor contracts that “provide for the furnishing of services or labor to the city,” as opposed to the purchase of goods or leasing property.
That means Starbucks and other retailers looking to fill up kiosk space near the San Jose McEnery Convention Center could get away with paying minimum wage instead.
“If the city required tenants leasing city property to pay a base wage more than 50 percent above San Jose’s minimum wage of $10.15 an hour, it is highly unlikely that existing or new retail tenants would accept this condition because they would not be able to remain cost-competitive in the market,” Director of Public Works David Sykes and Director of Economic Development Kim Walesh state in a city memo. “An outcome could be empty spaces or pressure to convert the spaces to office uses, which would be less beneficial to downtown.”
Councilman Don Rocha says he wouldn’t be opposed to offering discounted lease rates in exchange for continuing the living wage standard for private employees working on city property. He’s taken aback, however, by the city asking for a policy change without having come back with more information about the topic.
Councilman Ash Kalra agreed that changing the policy so dramatically merits further discussion.
“I understand the desire to remove ambiguities,” Kalra writes in a memo. “However, the current living wage policy is quite clear.”
Sure, employers will have to pay more under current rules, he adds. But the city should work with them to figure out how to honor a municipal law in place since 1998 that mimics policies in other major cities, including Los Angeles and San Francisco.
“As we exit the recession and we see the retail space in downtown and around the city begin to become increasingly occupied, it is a good time to capitalize on city assets by ensuring that we are helping to create jobs that allow employees to support families,” Kalra writes.
More from the San Jose City Council agenda for January 28, 2014:
• An audit of city employee travel expenses shows that quite a few people need a lesson in efficiency.
• Council seats for districts 1, 3, 5, 7 and 9 and the mayoral slot are up for grabs this election season. A vote from the council will allow the City Clerk to coordinate the elections through the Santa Clara County Registrar of Voters.
• The city will pay Renne Sloan law firm $975,000 to implement the council’s directives related to labor relations and pension reform.
• Dan Corson, a sculptor and artist, will land a $410,000 check from the city for creating public art installations involving light displays around downtown.
• In the 2012-13 fiscal year, the city oversaw issuance of more than $569.2 million of new or refunding debt. The outstanding debt portfolio, according to an annual review, is greater than $5.4 billion.
• The city’s revising the rulebook when it comes to cardrooms, which may soon be allowed to host charity events. Other changes include civilianizing gambling enforcement and shifting some permitting responsibilities back to the state.
WHAT: City Council meets
WHEN: 1:30pm Tuesday
WHERE: City Hall, 200 E. Santa Clara St., San Jose
INFO: City Clerk, 408.535.1260