Eleven dollars per hour probably isn't the type of wage that would allow anyone to afford a living in Palo Alto, but the City Council agreed on Monday night that it's a great place to start.
By a unanimous vote, an enthusiastic council approved an ordinance to institute a local minimum wage of $11 an hour, effective Jan. 1, 2016. For Palo Alto, which has never had a local minimum wage, this move is a significant first step in a multiyear march toward a $15-per-hour wage. The council agreed that this should be the city's goal, possibly as part of a coordinated effort with neighboring cities.
The council's vote places Palo Alto in the midst of a regional movement to raise the minimum wage, with Mountain View and Sunnyvale passing their own minimum-wage ordinances last October and San Jose adopting its minimum wage in 2013 through a voter initiative. It also goes further than the other ordinances. Mountain View, Sunnyvale and San Jose currently have a minimum wage of $10.30 an hour, with future increases tied to the consumer price index (CPI).
Without local minimum-wage requirements, cities are subject to the state standard, which is set to rise from $9 to to $10 an hour on Jan. 1, 2016.
In adopting the minimum wage, council members acknowledged its limitations. A person earning $11 an hour is unlikely to afford housing within 15 miles of the city, much less within Palo Alto, said Councilman Marc Berman.
"It's something that might allow them to move a little closer and commute not as far. It's something that will make their quality of life a little bit better. But it isn't something that will drastically change the way people live," Berman said.
Councilman Tom DuBois said his position on the minimum wage is "simple." Palo Alto is an expensive place and the minimum wage hasn't kept up with the rising cost of living here. He called $11 an hour a "reasonable compromise."
"We don't want to hurt businesses by moving too far, too fast," DuBois said.
The push toward the minimum-wage ordinance proceeded with little resistance. Like in prior discussions of the topic, most speakers at Monday's meeting spoke in favor of the change.
Business owners, however, were less thrilled. While the Chamber of Commerce has not taken an official position on the new law, the council heard Monday from a handful of critics from the restaurant industry.
Nancy Coupal, owner of Coupa Cafe, made the point that in the restaurant business, wages don't tell the full story. Tipped employees, she said, often earn more than managers, she said. She also said she doesn't think anyone in Palo Alto currently pays minimum wage.
"You can't get anybody," Coupal said. "It's hard enough to get staff to come here because there's nowhere to park and it's too expensive to live here."
Michael Ekwall, owner of the California Avenue restaurant La Bodeguita de Medio, also urged the council to take tipping into consideration. The city's minimum-wage ordinance would be better, he said, if the council considered total compensation, rather than just wage.
Ekwall told the council that his staff of 40 includes 15 employees who earn minimum wage, though their total compensation is more like $22 an hour.
"The more money we have to pay our minimum-wage earners, the less we have for other staff members who don't receive tips," Ekwall said.
But most of the speakers at Monday's meeting focused on the effect that the higher wage would have on local workers. Many urged the council to move ahead with the recommendation of its Policy and Services Committee and to pursue the "$15 by '18" goal. Meghan Fraley noted that Palo Alto is one of the most affluent places in the world and called the proposed increase "conservative."
"It's fundamentally a moral imperative that hard-working families can earn something close to a living wage," Fraley said.
Palo Alto resident Carol Lamont recalled her jobs in day care and as a waitress, gardener, house cleaner and clerk. She said she took the jobs "just to survive with my little baby" and had to choose between paying the rent, paying a phone bill, transportation costs, phone, utilities and food."
Often, the household was without electricity, she said. "We need to do better for ourselves and the people who work for us," Lamont said. "We need to pay $15-an-hour minimum wage now."
Larry Moody, a member of the East Palo Alto City Council, said he was speaking "on behalf of the hundreds and thousands of East Palo Alto residents who work in Palo Alto and commute every day" when he urged the council to move forward with the ordinance.
"Many of the residents who work in this community are from East Palo Alto. All they want is an opportunity to have hope," Moody said. "The hope that they can work hard, earn a wage that allows them to raise their sons and daughters in the community; the hope that the employers they're working with believe in them enough to help them."
The council agreed to further refine the ordinance in the months to come and directed its Policy and Services Committee to consider possible exceptions to the minimum-wage requirements. This would include, but not limited to, tipped employees and teens who get hired for seasonal jobs.
The committee will also chart the city's path toward a $15 wage in 2018, which may or may not look like the paths taken by neighboring cities. In June, Mountain View Mayor John McAlister and Sunnyvale Mayor Jim Griffith co-signed a letter to Palo Alto Mayor Karen Holman that advocated a "joint approach to reaching $15 per hour."
The council generally supported looking beyond the city borders in considering further changes. Councilman Cory Wolbach said he supports an approach where Palo Alto doesn't mimic other cities but seeks to coordinate with them.
Councilman Greg Scharff agreed, saying "I think it's important to think regionally and be on same page."