City to Review Minimum Wage Impact Studies Before Deciding Whether to Press On with Planned Raises

Two consulting firms, hired by the city, will present to City Council in February

Published : Wednesday, January 23, 2019 | 5:34 AM

Seven months after Pasadena’s Minimum Wage Ordinance raised wages to $13.25 per hour, the City will soon be looking at two studies which will examine the law’s local impact.

The pay hike was the third phase of an Ordinance which became effective in July of 2016 and which could raise the City’s minimum wage each year until it hits $15 per hour by 2020.

The Ordinance calls for a Year Three analysis before moving into the fourth and fifth pay raises. 2019 is the third year of the law.

According to Mayor Terry Tornek, the City has hired two separate consulting firms to prepare studies examining the effects the Ordinance has wrought so far. Their conclusions are to be presented in February.

“We had a five-year schedule when we implemented the law,” said Tornek in an interview Tuesday. The pause to study the Ordinance’s economic impact was built into the plan “to prevent some catastrophic financial disaster.”

Tornek added that he “didn’t want to prejudge the study,” but noted that the law was having a significant impact on some groups in the City.

“It’s obviously impacted those workers who are now making more money, and have more money to spend,” Tornek continued, adding, “It’s impacted local restaurants, and some non-profits, who have not been able to hire as many workers.”

The City itself has also been directly affected, said Tornek. Pasadena was not able to hire as many youth summer workers in 2018. Asked if that would change in 2019 with the City’s increased tax revenue, Tornek said, “That’s a budgetary decision further down the line.”

As Vice Mayor John Kennedy pointed out when the Ordinance was implemented, “It is extremely difficult to afford to live in the city of Pasadena.”

“Property values are just going up exponentially and so there has to be some kind of balance,” he continued, “People need to have a livable wage and businesses need to be able to stay in business. They’re in business to make money.

The wage increase has been applauded by proponents who see the increases as an opportunity for low-income workers to earn a better living in a city where living costs are high.

But employers have called the Ordinance a challenging burden which has led to higher prices and fewer hires. No sector has been affected more than Pasadena’s restaurants, whose owners say the higher-than-the-State’s increases puts them at a competitive disadvantage.

Pasadena Chamber of Commerce President and CEO Paul Little said he wants to see Pasadena’s minimum wage law dialed back to be in step with State of California’s timetable, $15-per-hour by 2022.

“Our preference would be to have the City align with what the state’s doing for lots of reasons. Slower ramp up is less immediate impacts,” Little said earlier. “Our folks who have businesses in multiple jurisdictions will be dealing with one set of regulations.”

Labor advocates are equally dedicated to seeing Pasadena press forward with the Ordinance’s proposed schedule.

“We want to make sure we move forward on the path towards $15 an hour,” said local labor activist Pablo Alvarado. “We want this to be the city of raises, not just the City of Roses.”

Alvarado said he join in a planned 100-vehicle “Pasadena Workers Justice Parade” this Saturday, January 26, in support of the minimum wage ordinance. Following a rally at 500 North Lake Avenue, the parade would travel first to City Hall, and then through Old Pasadena on Colorado Blvd.

“The message will get there,” said Alvarado. “We will be reaching out to City leaders as well.”