Portland will not begin enforcing a new minimum wage ordinance approved by 62 percent of voters until January 2022, Mayor Kate Snyder announced Tuesday.

While the ordinance gradually increases the city’s minimum wage from $12 an hour to $15 an hour starting in 2022, it also includes a provision that requires time-and-a-half pay during a declared emergency. That hazard pay provision was widely expected to take effect in December – 30 days after passage of the referendum – because of the ongoing state of emergency triggered by the coronavirus pandemic.

Snyder’s brief announcement came after she and city councilors met with their attorney, Danielle West-Chuhta, behind closed doors for about an hour.

“We were advised in executive session about legal implications and risks for various options for moving forward,” Snyder said. “Ultimately the council advised staff to enforce the minimum wage ordinance under the plain language which indicates it will take place in January 2022.”

People First Portland, the group that backed the proposal and three other successful ballot questions, dismissed the mayor’s announcement.

Volunteer Leo Hilton said the campaign will continue to tell workers they should begin earning hazard pay next month because of the civil emergency declared by Gov. Janet Mills. He warned that employers who follow the city’s advice might be forced to pay back wages – a reference to the city’s existing minimum wage ordinance, enacted in 2016, which allows a worker to sue their employer for wage violations.

“The language of the ordinance and the will of the people are clear,” Hilton said in a written statement. “Over 25,000 Portland residents voted for an increased minimum wage with hazard pay of $18 an hour going into effect on December 3rd. Nothing has changed with the council’s declaration tonight.

“By making this statement tonight, as COVID cases are spiking across the state, the council is turning their back on our essential workers.”

Snyder said the council also would examine on Monday other initiatives approved by voters, including  “A Green New Deal for Portland,” a ban on the use of facial recognition technology that includes enforcement measures and an act to protect tenants that includes rent control. The rent control ordinance requires landlords to roll back rents to June levels, for example.

The attorney for People First Portland had said on Monday that the city’s interpretation of the minimum wage ordinance flies in the face of the organizers’ intent. It also runs contrary to what voters were told would happen if it was approved. Summary language placed on the ballot by city councilors cited an example in which the emergency wage would be $18 an hour under the state’s current minimum of $12 an hour.

Benjamin Gaines, an attorney who advised People First Portland, wrote to the council on Monday in response to a Press Herald article about the city attorney reviewing the emergency wage provision. Gaines reiterated that the group’s intent was for the provision to take effect in December, citing media coverage and comments from opponents and proponents alike running up to the election. Any attempt to delay implementation until 2022 would be “absurd or illogical,” he said.

“People First Portland is not aware of any public account of the measure indicating that it would have the effect of temporarily repealing the city’s minimum wage until 2022,” he said. “Given the overwhelming consistency of statements both for and against the measure’s passing, no court would be likely to support such a reading. The city should, therefore, take appropriate steps to effectuate the will of its people.”

As many as 23,500 Portland workers could eventually see a wage increase under the new ordinance, including 14,000 workers making less than $15 an hour, according to the Maine Center for Economic Policy, a left-leaning research and advocacy group.

It is not clear how many workers would be qualified to received hazard pay this winter. The provision would effectively create a temporary $18 minimum wage for workers who are required to report to Portland workplaces during the emergency. It would not apply to those who work remotely.

Gaines could not be reached after the meeting Tuesday for an interview about how People First Portland planned to respond to Snyder’s announcement.

The council’s announcement comes amid a flood of concerns from local businesses and nonprofits that are urging the council to delay or eliminate the hazard pay provision, which is believed to be unique in the United States.

Business owners large and small, as well as some nonprofit groups serving people with mental illness and addiction, expressed concern to city councilors in emails Tuesday. Several said they already pay above the state minimum wage because it’s the right thing to do and it’s necessary to retain good workers. But they’re struggling to keep their doors open during the pandemic and would have to make tough decisions if the emergency wage kicks in next month.

The Portland Community Chamber of Commerce is surveying its members about the impact of the minimum wage law. Chamber CEO Quincy Hentzel said that of the 320 business owners who had responded as of noon Tuesday, 88 percent said the emergency wage would have a “negative” or “extremely negative” impact on their business or organization.

“When asked what changes they would be forced to make to operations to absorb the increased cost, 70 percent said they would need to reduce staff or staff hours. Thirty-six percent said they would need to reduce their hours of operations,” Hentzel said. “Overwhelmingly, businesses mentioned the following drastic measures they would need to take to stay open: either close their store temporarily or permanently; move out of Portland or stop providing services in Portland; reduce or cut employee benefits; increase the cost of goods sold.”

The emergency provision is even facing opposition from Betsy Sweet, a progressive activist who unsuccessfully sought the Democratic nomination for governor and U.S. Senate. Sweet, a lobbyist, wrote to the council on behalf of the Behavioral Health Collaborative, which includes the Opportunity Alliance, Spurwink, Shalom House and Sweetser, Inc., among others.

Sweet said most of their funding comes from state and federal grants, which they may be able to increase over time through advocacy so they can cover the gradual increase to a $15-an-hour minimum wage. But she said providers would be unable to pay the emergency wage in December, since it falls in the middle of the fiscal year.

“For just one of our agencies alone, the annual price tag of an $18/hour minimum wage is well over a million dollars – the rest are working on their numbers,” Sweet wrote. “This will force us to cut services, and serve fewer people at a time when substance abuse and mental health services are needed as never before.”

While the agencies don’t oppose the minimum wage increase, they need time to increase the reimbursements so they can survive, Sweet said.

Mike Alfiero, owner of Harbor Fish Market, said in an email to councilors Tuesday that he has been paying his workers $15 an hour since 2017 and offers other benefits, including 401k, medical insurance and paid time off. That type of pay and benefit package is necessary to retain employees in Portland, he said. But the pandemic has reduced sales by 30 percent through October – a trend he expects will continue through April 2021.

The emergency wage provision will likely force him to increase prices, cut hours, reduce benefits, lay people off or close during emergencies, he said.

“The fact that this passed during a pandemic, and that our business community is about to suffer further is egregious in nature,” Alfiero said. “We know that the cost of living in Portland has gone up, specifically housing cost. It should not fall on the shoulders of small Portland businesses to solve the issue, especially during a pandemic. I know that most of you did not support the referendum, and I hope you can help us deal with this.”

David Barber, of Tyson Foods, said the emergency wage was a “game-changer.” And he wondered if voters were too focused on the presidential and U.S. Senate races to give careful consideration to the referendum questions and their impact. He also urged councilors to consider changes to the referendum process.

Barber also urged councilors to “delay or eliminate” the emergency wage – something that cannot be done by the council for at least five years, unless it’s through another referendum or a legal challenge.

“I have talked with a few Portland residents and heard that they didn’t realize the time-and-half penalty in the measure,” Barber said. “With the intense focus on the Senate and presidential races, getting the message about this devastating measure was going to be a challenge. Changing the referendum process in the city is also something that needs attention.”

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