City May Weaken Living Wage Policy

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

Jennifer Wadsworth is the former news editor for San Jose Inside and Metro Silicon Valley. Follow her on Twitter at @jennwadsworth.


  1. The City expends a great deal of effort and tax dollars making sure employees are paid above market wages.
    It’d be nice to see them expend one tenth as much effort making sure those employees are legally allowed to work in this country.

  2. D Wall, I will vote fOR YOU. Thanks for giving us the rear facts!  Most idiots don’t vote or drink Chucks cool aid.  It is sad that to few who vote do it on mailers, instead of studying the real facts.  But this is the ‘Chuck way, because he knowns most voters don’t can and will not read the ballot issues.  Sam will hope one the same.

  3. Jenn W;

    The January 28th City Council Agenda has a couple of tasty tidbits omitted in your report that is germane for today’s discussion.

    Item 3.8: Actions Related to the Agreements for Temporary Staffing Services for Building Inspectors, Plan Review, and related Services.

    Item 3.8 is directly related to; Item 2.10 (which you addressed in your report): Agreement with Renne Sloan Holtzman & Sakai LLP for Legal Services and Adoption of Appropriation Ordinance Amendments in the General Fund for Fiscal Reform Plan Legal Services which in any parlance is called, “the ongoing foreseeable and exceptionally egregious costs of Measure B.”

    This is the same foundational action already seen at the San José / Santa Clara Water Pollution Control Plant (WPCP). First at WPCP there was a similar request for “Temporary services” to address the need to replace; WPCP Plant Operators, Mechanics and Industrial Electricians. After the city spent “millions” in “Temporary employment contracts” to address this fiasco, Mayor Reed led the charge to amend the Municipal Code to allow for the “Reclassification” of the aforementioned employee job classes to be able to pay these employees more because, like the Police Department, employees at WPCP were leaving in droves and the “Temporary services contracts” had “no end in sight.” Other “Reclassification” scenarios at WPCP are in progress. 

    This conduct by Mayor Reed and Council is nothing more than a scam designed “to skirt and try to control the out-of-control-costs the Measure B.” The “Reclassification mechanism” is an attempt to restore pay and benefits before the entire city organization collapses. Now we see the Director of PBCE “hanging-around” for another month past his retirement date and the need to give PBCE a $3 Million dollar “Line-of-credit” so to speak, to line up some “Temporary employees” to perform tasks “at higher rates” than city employees with benefits prior to the Measure B imposed thievery.

    The juiciest of the tidbits not mentioned in your report can be found on
    Item 9.1: Review and Discussion of the Long-Range Property Management Plan (herein “Plan”).

      This “Plan” is an attempt to dispose of properties by the Successor Agency of the former Redevelopment Agency. This “Plan” is worse than a “Fire sale.” It is basically a “Give away” property scam to the “highest bidder” of properties identified to be disposed of to meet state obligations pertaining to dissolution of RDAs by Governor Brown. This “Plan” is a ninety-eight (98) page report that should damn any Mayoral candidate on Council Who voted to buy these properties in the first place) from ever being elected.

      A couple examples contained in the “Plan.”

      The amalgam of eight (8) properties into one (1) property is across the street from city hall. These properties were purchased and assembled together for the intent of a “Symphony Hall” at a cost of $11 Million and significant “Change.”  The top bid tendered to the city is
    $4, 250,000. Do the math to see the cost the taxpayers will lose if Council agrees to this offer. READ this REPORT!

      Another example, discussed publically for some time are the properties purchased and assembled for the accursed “Baseball Stadium.”  Cost to purchase and assemble the properties is a little shy of $25 Million. The first and second “Option Agreements” to sell the land to Mr. Lew Wolff, a very little shy of $7 Million. Again, do the math and READ THE REPORT! By the way, the “Option” expires on November this year.

      This “Plan” is fraught with other excessive and extreme losses of taxpayer monies VOTED on by several existing Council members.

      Jenn W- the SJ Inside should conduct an exposé on Item 9.1 alone. Of course, the “Temporary Staffing Services issue” is also very ripe indeed.

    David S. Wall

    • Mr. Wall , as always, you have a great understanding of the underbelly of this shady city. Once again thank you for sharing your knowledge.  I know you are running for mayor but maybe you should run for Liccardo’s seat as well.

      It is a disgrace that this city spends $1.4 million at a drop of a hat for lawyer fees and art projects.  Then as Mr. Wall points out, the city is willing to discount city property for a loss of millions of dollars.  All while we see parks crumble, libraries remain dark, fire fighters responses times clime and homicides/burglaries continue.

      We need change. We need to vote.

  4. > It is sad that to few who vote do it on mailers, instead of studying the real facts.

    One of the fundamental problems with elections is that it is virtually impossible for almost anyone to get a grasp of “the real facts”.

    People like Rich Robinson and Peter Allen (so-called “political consultants”) are paid far more than they’re worth to substitute sappy, ridiculous “narratives” for “real facts”.

    Has Rich ever given us any “real facts” on High Speed Rail (a synonym for Stupid High Speed Rail)?

    Has Peter ever given us any “real facts” on Rooftop Solar (a synonym for Stupid Rooftop Solar)?

  5. Oh boy, a 68 page report on the relatively minor offenses of employee travel, and most if not all, did not seem to represent attempted fraud. 

    Interesting that there is not one mention of mayor, council and Figone travel to Ireland.  Or why it was even necessary?  And I am not aware of carpooling being mandatory in terms of travelling to an event in another City, and claiming a mileage reimbursement.  The 24 employees that drove to Modesto, are certainly free to do so.  The City doesn’t pay the employee’s insurance deductible so why should employees risk their own insurance driving their co-workers to events?  That seems reasonable. 

    And are City vehicles even available to this type of travel?  In most cases, City vehicles are in dreadful condition, or with the electric vehicles, not capable of driving over 100 miles.

    And heaven forbid that someone actually drove to SoCal instead of having flown.

    Meanwhile, the Council gave away $600,000 to a charter school, and will give away $200,000 to another one.

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