Portland studies proposal to raise minimum wage to $20

File photo A proposed $20 minimum wage for Portland could help lower income workers.

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A proposal to raise Portland’s minimum wage from $15.50 to $20 per hour over three years is under consideration by the city’s Housing and Economic Development Committee.

The committee was asked by Portland City Council to review the potential wage hike, and make a recommendation for possible council action. The proposal does not include changes for tipped workers who currently earn $7.75 per hour.

The committee met March 18 via Zoom and heard public comment from close to 25 residents and business owners. More comments were posted on the city’s web portal. The majority of residents who spoke supported the increase, while most employers were opposed, though not unsympathetic to the plight of low-wage earners contending with the high cost of living in Portland.

Residents repeatedly cited the difficulty of finding affordable housing in the city and urged the committee to support the wage increase. Bradley Davis quoted statistics from Zillow that claimed the average monthly rent in Portland is $2,500. “People are rent-burdened. What happens when all of the workers leave the city?”

Sophia Thomas echoed the sentiments of many who spoke in favor of the increase, and felt it wasn’t high enough.

“I love living here, but it’s just way too expensive," she said. "It’s a challenge to get by, and I earn a bit more than $20 an hour. With inflation and the price of food, it’s crazy. More disposable income means people could support businesses here. Businesses can’t rely just on cruise ships and tourists.”

Opposition

Small business owners who spoke against the proposal included Steve DiMillo and David Turin, both long-time city restaurateurs. DiMillo said he already pays $18 per hour to dishwashers, “I can’t hire anyone for less,” and added the increase will hurt businesses by driving up prices. “There’s a limit to how much someone will pay for a bowl of chowder and a beer.”

Turin, who said he has a staff of 50 at David’s on Monument Square, lamented that "it is extremely expensive to live in Portland. But raising the minimum wage will actually hurt the economy rather than help it. It will cause more homelessness and more struggles rather than less.”

Turin said he projects the wage increase would add $40,000 to his annual budget.

Inflation

City councilor and committee member Regina Phillips, a co-sponsor of the proposal, said she questions the notion that Portland restaurants would suffer under a wage increase. “Portland restaurants are jam-packed; you can’t get into our restaurants," she said.

Other speakers decried the cost of rents in Portland as one of the contributing factors to recent restaurant closings, and urged the committee to consider rent control for commercial buildings.

Several people opposed to the hike said the increase would amount to 30% but committee member and city councilor Kate Sykes, one of the proposal’s sponsors, said that number was incorrect. “It would be a gradual raise of 9.7% annually which is in line with inflation.”

Sykes also corrected the oft-stated affirmation that the increase would amount to Portland having the highest minimum wage in the country. Sykes said both San Francisco and Seattle “will exceed $20 an hour before we get there. This is designed so that the wage is adequate, not extraordinary.”

The minimum wage for Maine is $14.65 per hour, with a tipped employee minimum wage of $7.33 per hour, but employers are required to ensure that the total of wages and tips reaches $14.65 per hour.

The last adjustment to Portland’s minimum wage was approved by voters in November 2020 and went into effect January 1, 2022. The HEDC reviewed a wage proposal three years ago but made no formal recommendations to the city council.

“The question here is can people who work full-time in Portland afford to live here,” Sykes said. “For many, the answer is no.”

Committee member Sarah Michniewicz said it would be important in future discussions to look at how the change could impact city payroll and the mil rate. Estimates she shared projected an increase to the city’s bottom line of as much $11.5 million by 2028.

The committee took no vote on whether to recommend the wage increase to the city council, which is the next step, but expects to expand discussion and possibly vote at a future meeting. The council can then decide to oppose the hike, advance a referendum to voters, no sooner than November, or possibly to approve the increase by council vote.

City attorney Michael Goldman said it wasn’t entirely clear if the council can vote to amend the existing wage structure without a referendum, prior to Jan. 1, 2027, “But they can put it on the ballot.”