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Mayor ponders Baltimore minimum wage hike as backers go on offensive

1.12.2017 BALTIMORE, MD- Mayor Catherine E. Pugh joined by U.S. Attorney General Loretta E. Lynch to announce agreement on the Department of Justice Consent Decree concerning practices by the Baltimore Police Department. (The Daily Record/Maximilian Franz)

Baltimore Mayor Catherine Pugh (File photo)

Mayor Catherine Pugh’s decision whether to sign or veto a bill raising Baltimore’s minimum wage to $15 an hour could come as soon as next week.

Anthony McCarthy, a spokesman for Pugh, said Thursday she’s checking-in with executives in nearby counties to get their insight into the proposal as she continues to weigh her decision.

“Within the next week or so we’ll probably make a determination,” McCarthy said.

The bill, passed by the Baltimore City Council on Monday, raises the city’s minimum wage requirement to $15 an hour by 2022. It includes carve-outs allowing businesses with less than 50 employees to phase in the increase through 2026. The minimum wage would also only apply to workers who are at least 21 years old.

While the mayor considers the bill, supporters of the legislation are working to push back on the narrative that it poses a dire threat to the city’s small businesses and economic development. On Thursday, they questioned the costs projected by city finance department’s analysis of the bill and argued the increase would be a boon to the city’s economy.

David Cooper, senior economic analyst with the Economic Policy Institute, said in the boost in wages will result in roughly 24 percent of the city’s workforce receiving a raise, which means the average income of impacted workers will rise on average $4,400 a year in inflation adjusted terms. About 60 percent of those workers, he said, are city residents.

“I think a lot of the opposition to this bill has been based on the premise that somehow Baltimore is different from all these other places that have passed $15 minimum wages,” Cooper said in a conference call with reporters arranged by the Fight for $15 Baltimore Coalition. “And while I would caution against thinking that way, even if you believed that, the truth is this $15 minimum wage bill is different… this is far and away the most business-accommodating $15 minimum wage bill that has passed in any jurisdiction anywhere.”

The city’s Department of Finance has estimated the price tag of the wage increase at $115.8 million in the next seven years. At the same time, the administration is trying to rein in police spending as homicides spike, cover the expense of complying with a Department of Justice consent decree and resolve the city school system’s roughly $130 million budget deficit.

During her campaign for mayor last year Pugh, who took office in December, indicated she would support a minimum wage increase if it landed on her desk. But the mayor, a small business owner who has made economic development in the city’s neighborhoods a priority, has approached the proposal with caution.

As a state senator, Pugh supported attempts to raise the state’s minimum wage. Now, as mayor, Pugh remains more comfortable with the idea of increasing the wage at a state or regional level, according to sources familiar with her thinking. That approach avoids potential calamities associated with turning Baltimore into an island surrounded by wealthier neighbors with lower minimum wage requirements.

Business advocates and the city’s quasi-public economic development corporation continue to advocate for its defeat.

“There is no realistic way to avoid the devastating impact this bill will inflict on Baltimore’s small businesses,” the National Federation of Independent Businesses said in a statement following the council’s passing the bill. “Our hope is that the mayor will hear the concerns of Baltimore’s small employers and put an end to this measure before it is implemented.”

Even if the mayor vetoes the bill it is not entirely clear that decision would stick.

Twelve council members voted for the legislation, which is enough to override a potential veto, and it is unknown if the mayor, who was not endorsed by a single sitting council member, could sway members not to overrule her decision.

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