Council Approves ‘Living Wage’ Law for City Contracts

Extending a hand to thousands of impoverished workers while tossing the mayor a sharp political challenge, the Los Angeles City Council on Tuesday adopted an ordinance requiring some private firms with city ties to boost the pay and benefits of their bottom-rung service employees.

With the council’s 12-0 vote--two more than needed to override a promised mayoral veto--Los Angeles seems destined to join a small but growing number of American cities that have put so-called living wage ordinances on the books. New York, Baltimore and San Jose are already among those cities that have raised the minimum pay for the employees of municipal contract holders, thanks in large part to the efforts of well-organized union leaders, community activists and clergy.

In Los Angeles, Tuesday’s lopsided vote belied the months-long battle over the bitterly contested measure, which pitted business leaders and Mayor Richard Riordan against council liberals, led by Councilwoman Jackie Goldberg, and the Living Wage Coalition of activists.

The ordinance will apply to holders of city contracts of more than $25,000 and goes farther than its counterparts around the nation by also including companies that receive substantial amounts of city financial aid--at least $100,000 a year or $1 million or more in one-time assistance. Employers must pay their janitors, security guards, gardeners, food service workers and the like at least $7.25 an hour with benefits--including health insurance and 12 paid days off--or $8.50 an hour without benefits.

Although the reach of the ordinance is modest--only about 5,000 workers, less than 0.5% of the work force, will be affected--it is widely viewed by advocates as an important signal that the city is committed to watching out for those who perform public services on its behalf. But opponents say it sends another message--that Los Angeles is hostile to business and unable to compete with neighboring cities to lure job-creating, taxpaying companies in a region only now recovering from a long recession.

“This has been a nine-month-long issue” with at least half a dozen public hearings, three studies and considerable compromises, Goldberg told her colleagues before the vote Tuesday.

“This is really a very simple matter . . . that people who work hard” and whose employers benefit from their city ties “should be able to live on what they earn,” Goldberg said. She was cheered on by a vocal, overflow crowd of activists wearing makeshift badges reading “Do the Right Thing.”

Tinged with election-year maneuvering, the ordinance’s timing will force the mayor to take action on the measure before the April 8 municipal primary, in which he faces a challenge from state Sen. Tom Hayden (D-Los Angeles), an ardent advocate of the living wage legislation.

Once the ordinance reaches his desk, Riordan has 10 days in which to veto, sign or let it become law without his signature. In a news conference later Tuesday, the mayor firmly voiced his resolve to veto the ordinance.

“I share the goal of a living wage for every Angeleno. However, the ordinance passed by the City Council today is a long way to get there. In fact, it undermines the goal,” Riordan said, as Goldberg and some of her aides sat in on the news conference.

“I will veto this ordinance. . . . I disagree with it, and I believe it will hurt those it intends to help,” Riordan said.

The city’s business leaders--who lost last-ditch efforts to modify a measure they believe undermines their efforts to improve the city’s economic climate--were the first to press their case in the brief public hearing before the council vote.

“We are fundamentally and philosophically opposed to what is being considered here,” Carol E. Schatz, president of the Central City Assn. and a leading business lobbyist, told the council.

Toy importer Charlie Woo, representing the Los Angeles Area Chamber of Commerce, said the city still suffers from an image of being unfriendly to business and “this proposal really adds to that perception.” Woo suggested the council take steps to create more entry-level jobs instead.

For emotional punch, however, their testimony was overshadowed by the words of some of the workers who will be helped by the ordinance.

Parking services worker Ricky Lawson read a letter signed by himself and nearly 200 other contract service employees at Los Angeles International Airport, asking the council not to leave them out of the ordinance.

“There are between 1,000 and 2,000 of us at the L.A. Airport that earn low wages and hardly any benefits,” the letter said. “We put our lives on the line on a daily basis to serve you, to protect you from violence, to clean up after you and to take care of your cars. . . . We must work when we are sick and hungry, and we must live in cramped living quarters because we can’t afford decent housing. We must go to churches to ask for food or accept public assistance because we can’t make it on our own.”

The debate also featured a rare council chambers appearance by City Controller Rick Tuttle, who urged the council to adopt the measure and said it would have little or no adverse effect on city finances--a finding also made earlier by the city’s two top fiscal and policy officials, City Administrative Officer Keith Comrie and Chief Legislative Analyst Ronald Deaton. They found the measure would cost up to $21 million when fully phased in, but much of the expense would be borne by contractors or consumers. They estimated it would eliminate at most 200 jobs.

Riordan had sought two amendments, promising not to veto the measure if financial aid recipients were excluded. He also wanted to remove the city’s three semiautonomous departments--Airports, Harbor and Water and Power--because the city attorney’s office contends that the council is not authorized to exert such control over them.

But Goldberg insisted the departments could and should be included, reminding the council that the drive to protect city contract holders’ employees began in response to mass threatened layoffs two years ago, when airport contracts changed hands. About two-thirds of the workers to be covered by the living wage ordinance worked in these three departments, Goldberg said.

Councilman Marvin Braude, who had offered the amendment to exclude the three departments, withdrew it after assurances from the city attorney’s office that there were ways to limit the city’s liability--including having the three department boards adopt policies reflecting the ordinance.

He also castigated the business community--saying it “has not carried its fair share” of efforts to improve the lot of the city’s neediest families.

Councilman Joel Wachs, who shares the mayor’s cost-cutting, business-minded philosophy, drew surprised cheers when he announced his support for the living wage measure. He, too, tore into the business leaders, noting many of them had spearheaded efforts to provide wealthy sports team owners with hefty city subsidies so they would build a sports arena project. Wachs opposed the project as a bad deal for taxpayers.

“The least they can do is pay a living wage,” Wachs said.

There were digs at the mayor, too, including a shot at the multimillionaire Riordan’s TV campaign spot that boasts of his taking only $1 a year in salary.

“I wish we could all work for a dollar a year,” Councilman Mike Hernandez said, “But this ordinance is dealing with reality.”

And Council President John Ferraro and Councilman Hal Bernson, who had planned to vote against the measure, gave Goldberg’s efforts a boost when they left the council chamber before the roll call. The therefore unanimous vote allowed the measure to be adopted on its first reading instead of having to return for another vote a week later.

When the final vote came, the crowd of living wage advocates erupted in joyous shouts, cheers and clapping. Several leaned over the thick rope separating council members from spectators and hugged Goldberg.

In large part, the strong vote was a tribute to the savvy and doggedness of Goldberg, and even a deputy mayor offered grudging congratulations. At a hastily called celebration-cum-news conference outside City Hall after the vote, however, Goldberg passed the credit around.

“A lot of this happened because of you,” Goldberg told jubilant members of the Living Wage Coalition. “You came forward and told your stories, you offered assistance, you worked hard.”