A 38% Increase in Minimum Wage Passes Into Law
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ALBANY – Hundreds of thousands of New Yorkers will receive a government-mandated raise in January now that the state Senate has overridden Governor Pataki’s veto of a $2 hike in the minimum wage.
The 51-7 vote by the Republican-led Senate assures that the state minimum wage, which matches the federal rate of $5.15 an hour, will gradually increase to $7.15 by January 2007. It will go to $6 as of the New Year and to $6.75 in January 2006.
The Assembly, where Democrats are in the majority, overrode the veto in August.
The Senate’s action, along with routine confirmation of 31 gubernatorial appointments, is the only concrete result so far of a special session that legislative leaders called to tie up the many loose ends of 2004.
Lawmakers said they hoped to find compromises on other outstanding issues – such as expanding Manhattan’s Jacob K. Javits Convention Center, shortening sentences for drug crimes, and overhauling the state budget process – that could be approved before they adjourn this afternoon.
Mr. Pataki, legislative leaders, and their aides said they were close to deals in each of these areas, and planned to continue negotiations late into the night.
Also yesterday, the Senate majority leader, Joseph Bruno of Rensselaer County, said his house has no intention of raising taxes to deal with the financial pressures facing the state – including a deficit of up to $6 billion in the next fiscal year, along with demands for more spending on public schools, Medicaid, and New York City’s transit system.
“We don’t have tax increases on our agenda, now or next year,” Mr. Bruno said. “We don’t intend to raise taxes.”
Alluding to proposals to expand legalized gambling, he said: “We have sources of revenue without raising taxes.”
Mr. Bruno made similar commitments in early 2003 but later supported a plan that balanced the budget with temporary increases in income taxes and sales taxes. When Mr. Pataki vetoed those measures, Mr. Bruno prevailed on all of his fellow Republican senators to override the governor.
With the Senate’s latest override, New York joins 12 other states and the District of Columbia in setting a higher minimum wage than the national rate. The highest currently is $7.17 an hour in the state of Washington, where the minimum increases automatically based on inflation.
Proponents of the hike in New York, including labor-union and anti-poverty activists, said the extra $2 an hour will improve the lives of an estimated 691,000 state residents, including 287,000 from New York City, who currently make less than $7 an hour. They predicted the new law will also indirectly boost the income of another 509,000 New Yorkers currently earning between $7 and $8 an hour.
“It’s a pretty good day for about a million people in the state who will have better food, be able to pay their rent, spend a little time with their children,” the director of the Working Families Party, Dan Cantor, said. “These are family values.”
Business officials blasted the decision, predicting the rising cost of labor will trigger layoffs by small employers across the state.
“It’s especially troublesome, with all the uncertainty and weakness in the economy, that they would impose a $2.8 billion tax on small business – because that’s what this boils down to,” the state director of the National Federation of Independent Business, Mark Alesse, said.
“When businesses see costs are growing out of control in an area, they cut in that area,” Mr. Alesse said. “People are going to lose jobs because of this, and they’re going to be the most vulnerable workers.”
Mr. Cantor, whose party led the lobbying campaign for the wage hikes, rejected those arguments.
“The right wing says this any time there’s any kind of societal improvement,” he said. “To their way of thinking, slavery would produce full employment. … We can’t afford not to pay decent wages. It’s a reflection of what kind of society we are trying to build.”
Mr. Bruno had long resisted the move, saying it would drive up the cost of doing business in New York and hurt the state’s economic competitiveness. But with several of his members facing tough re-election fights, the Senate leader switched positions and allowed the bill to pass his house in July. The move cost Mr. Bruno and some other Republican senators the support of the state Conservative Party. On the other hand, some senators in key races picked up valuable endorsements from labor unions and the Working Families Party.
On Election Day, the Senate Republicans lost at least three seats, including the one belonging to Olga Mendez of East Harlem, the sponsor of the minimum wage bill.
During yesterday’s vote, several Republican senators denied that they were approving the measure for political reasons, insisting they intended only to “do the right thing.”
The vote is making a commitment “not to a political leader, not to labor unions, but to the working men and women of this state,” Senator Nicholas Spano of Westchester, whose own re-election remains too close to call, said.
Mr. Bruno said he continues to hope Congress will approve a similar increase, to shrink or eliminate the difference between the minimum wage in New York and other states. In the meantime, he said, “We think the families that will be the beneficiaries of this deserve to have an increase in their wages.”
Mr. Pataki’s spokesman, Kevin Quinn, said the governor was “disappointed” by the override.
The proposal to expand the Javits Center continued to suffer from its association with a plan to build an adjacent football stadium on the West Side, which faces stiff opposition in the Legislature. Mayor Bloomberg is pushing both projects as part of his plan to redevelop the West Side and win the 2012 Olympic Games for New York City.
Mr. Bruno said his house was ready to approve a “clean” Javits bill, one that is neutral on the stadium issue. People following the debate said the Senate was pushing privately for $350 million to finance similar public-works projects on Long Island and upstate, to match the proposed government subsidy for Javits. Meanwhile, Mr. Bloomberg was pushing for a bill that would make it easier for him to win on the stadium issue.
“The mayor doesn’t want a ‘clean’ bill,” one official following the talks said, speaking on condition of anonymity. “His thinking is, unless both happen, then he’s not going to get the stadium. He would lose momentum if he only gets Javits.”
Mr. Pataki and legislative leaders were also searching for a compromise on budget reform. He had vetoed a proposal from the Legislature, saying it would unduly weaken his control over the budget process. Mr. Bruno has said he is prepared to override that veto if the Legislature and the governor can’t agree on an alternative before next year.
Negotiators were also discussing the Rockefeller-era drug laws, which impose some of the harshest sentences in the country for narcotics crimes. Legislators of both parties support reducing those penalties and allowing nonviolent offenders to receive treatment rather than incarceration, but disagree about how far such changes should go.