Testimony In Favor of County Bill 28-17 - County Minimum Wage

September 26, 2017

The Board of Directors of the Woman’s Democratic Club of Montgomery County strongly supports increasing the Montgomery County hourly minimum wage to $15 by July 1, 2020 (with specified exemptions), as proposed by Bill 28-17. We urge you to vote in favor of this bill. No one who works full time in Montgomery County should have to raise a family in poverty.

We support the bill’s slower phase in until July 1, 2022, for employers who employ 25 or fewer employees, have IRS 501(c)(3) tax-exempt status, and provide “home health services” or “home or community-based services.” We also support the requirement for annual adjustments based on the Consumer Price Index for Urban Wage Earners and Clerical Workers starting July 1, 2023, and the provision for a “safety valve” suspension of the annual wage increase, based on an impact analysis of the minimum wage on the local economy.

We do not support County Executive Leggett’s proposal to change the definition of “small business” to 50 or fewer employers and to extend the timeline for implementation to July 1, 2022, for large employers and July 1, 2024, for small employers and nonprofits. We do not object to establishing a period after initial employment during which an employee may be paid 85 percent of the County minimum wage. However, we are concerned that a 90-day period may result in adversely affecting seasonal workers or incentivizing some employers to limit their employment period to avoid paying the full County minimum wage. We support establishing a separate “opportunity” wage for workers under 20 years of age for the first 6 months of employment, set at 85 percent of the County (not the State) minimum wage.

Like so many others, WDC was deeply disappointed by the flawed study by Public Financial Management, Inc. that in addition to calculation errors, failed to adequately evaluate the economic benefits that would accrue to the County’s minimum wage workers and the economic impact of these benefits.

A job should lift families out of poverty, not keep them in it. Even with this increase, minimum wage workers will fall short of what is needed to cover the cost of basics in high cost Montgomery County – estimated in 2017 to be nearly $20 per hour. With fewer workers covered by unions, government must step in to support and protect working families. That is why Montgomery County must take the lead and join a growing number of other jurisdictions, including the District of Columbia, that have already increased their hourly minimum wage to $15.

An estimated 88,000 workers will be affected by this bill. Many are female-headed and minority households. We believe this Bill will help reduce the dependence of the County’s low-wage workers on the County’s social safety-net programs, which are supported by County taxpayer dollars that indirectly subsidize businesses that pay low wages. This increase will benefit our overall economy because it will put more money into the hands of low-wage workers who spend most of their income on basic necessities, often at local businesses. Studies have also documented that increased starting wages can have a significant impact on life-time earnings – narrowing the income gap among groups.

We hope that for all of these reasons, the Woman’s Democratic Club can count on your vote in support of Bill 28-17.

Respectfully,

Fran Rothstein | President