Legislature(2019 - 2020)GRUENBERG 120

05/09/2019 03:00 PM House STATE AFFAIRS

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Audio Topic
03:05:05 PM Start
03:05:16 PM HR11
03:31:15 PM Presentation(s): Missing and Murdered Indigenous Women
04:18:50 PM HB28
05:04:10 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Heard & Held
-- Public Testimony --
+ Presentation: Missing and Murdered Indigenous TELECONFERENCED
Women by Dept. of Public Safety
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
               HB  28-EQUAL PAY & MINIMUM WAGE ACT                                                                          
4:18:50 PM                                                                                                                    
CO-CHAIR  FIELDS   announced  that  the  final  order  of business   would                                                      
be  HOUSE   BILL  NO.   28,  "An  Act   relating   to  an  annual   report                                                      
concerning    the   payment   of   equal   pay   for   comparable    work;                                                      
increasing   the   minimum   wage;   and  providing    for  an  effective                                                       
4:19:59 PM                                                                                                                    
ANDREW   BEANE,   Vice  President,   Service   Employees    International                                                       
Union   (SEIU)   775,   relayed   that   SEIU   775  is   a  labor   union                                                      
representing   45,000  homecare   and nursing   home  workers  across  the                                                      
states  of  Washington  and  Montana.    He offered   that after  the  $15                                                      
minimum   wage    law  was   passed    at  Seattle-Tacoma     ("Sea-Tac")                                                       
International      Airport   in   2013  and   in  Seattle   in   2014,  he                                                      
directed  an  organization   called  "Working   Washington"   to organize                                                       
airport   and  fast  food   workers  regarding   the   demand  for  a  $15                                                      
minimum wage.                                                                                                                   
MR.   BEANE   began   his   PowerPoint   presentation,     entitled   "$15                                                      
Minimum   Wage   in   Seattle."      Turning    to   slide   2,  entitled                                                       
"Overview   of  Seattle   Minimum   Wage,"   he  said  that  the   Seattle                                                      
minimum  wage  law  was the  first  in  the country   to pass;  there  was                                                      
broad  demand   from  the  public.    There  was  a  faster   phase-in  of                                                      
the  law for  large  employers   - those  with  over  500 employees   - to                                                      
achieve  the  $15  minimum   wage  by  2017  and  a slower   phase-in  for                                                      
smaller employers.                                                                                                              
MR.  BEANE   relayed   the  information   on  slide   3,  entitled   "Dire                                                      
Predictions about the Minimum Wage," which read:                                                                                
         • Tom Douglas, operator of 15 high-end restaurants                                                                     
           in Seattle, predicted that the proposed minimum                                                                      
           wage would cause the city to "lose maybe a                                                                           
           quarter of the restaurants in town."                                                                                 
         • North American Association of Subway Franchises                                                                      
           said,     This   ordinance     means   that   franchises                                                             
           cannot   compete    in  the   Seattle   marketplace   and                                                            
           many   franchise    small  businesses    will   cease   to                                                           
         • Andrew Friedman, proprietor of Liberty Bar, said,                                                                    
           "Local independent businesses will close, many of                                                                    
           your neighbors will be out of work."                                                                                 
MR.  BEANE   described   the  reality   of  what  actually   occurred   as                                                      
shown  on  slide   5,  entitled   "Seattle's   Booming   Economy,"   which                                                      
         • Forbes ranked Seattle #1 "Best Place for                                                                             
           Business" in 2018                                                                                                    
         • Unemployment in Seattle going down                                                                                   
              • In 2019, Seattle unemployment 3.3%, compared                                                                    
                 to 3.8% nationally                                                                                             
         • Economy in Seattle growing                                                                                           
              • From 2014-2019, average annual job growth of                                                                    
                 2.7% and income growth of 4.7%                                                                                 
         • In 2019, Seattle 3rd in the nation for small                                                                         
           business growth                                                                                                      
CO-CHAIR   FIELDS  asked  whether   an  income  growth   of almost   twice                                                      
that of job growth is higher than the national performance.                                                                     
MR. BEANE replied that he didn't know.                                                                                          
REPRESENTATIVE    WOOL  asked   whether   Mr.  Beane   is  implying   that                                                      
Seattle  raising   the  minimum  wage  and  having  a good  economy   is a                                                      
"cause and effect" relationship.                                                                                                
MR.  BEANE  stated  that  he is  not implying   that  but is  saying  that                                                      
a city can raise the minimum wage and have a booming economy.                                                                   
4:24:04 PM                                                                                                                    
MR.   BEANE    commented    on   Seattle's    restaurant    industry    by                                                      
reviewing   slide  6, entitled   "Restaurant   Industry  Growing;   Prices                                                      
Stable," which read:                                                                                                            
         • Seattle Times study of restaurants in 2017-2018                                                                      
              • 652 restaurants opened, 156 closed                                                                              
              • Net gain of 496 restaurants                                                                                     
         • University of Washington longitudinal study of                                                                       
           food prices in local supermarkets                                                                                    
              • No significant evidence of price increases                                                                      
                 associated with the minimum wage ordinance                                                                     
MR.   BEANE  provided    information    from  slide   7,   entitled   "Job                                                      
Growth in Food Service," which read:                                                                                            
         • Food prep and service make up 66% of low-wage                                                                        
           work in Seattle                                                                                                      
         • Steady   increase     in    Seattle     food    service                                                              
           employment: 27,300 new food service jobs created                                                                     
           in 2018                                                                                                              
MR.  BEANE  added  that  since   the  minimum  wage  was  enacted,   there                                                      
has  been  competition    for  food  service   workers  in  Seattle,   and                                                      
some  of the  other  cities  have  raised  their  wages  to  compete  with                                                      
Seattle.    He  reiterated  that  he  is  not saying   that  these  things                                                      
occurred    because   of   the   minimum   wage   but   that   the   worst                                                      
predictions did not occur.                                                                                                      
MR.  BEANE   reviewed   the  results   of  a  University   of  Washington                                                       
study,   displayed   on  slide  9,  entitled   "Study   1:  Workers   Earn                                                      
More and Keep their Jobs," which read in part as follows:                                                                       
         • University of Washington study of low-wage                                                                           
           workers in Seattle                                                                                                   
              • Workers take home more money                                                                                    
                    • Earnings increases were higher among                                                                      
                       more experienced workers                                                                                 
MR.  BEANE  added   that  an  initial  study   was  done  which  showed  a                                                      
decline  in  workers'   hours  resulting   in them  losing   money;  these                                                      
results   were  reported   in  the  media;  a  subsequent   study   showed                                                      
the  results    to  be  erroneous    and  that   workers   were  actually                                                       
taking  home  more   money  overall.    Earnings   were  higher  for  more                                                      
experienced    workers  who   worked   the  same   hours  but   made  more                                                      
money;  hours  may  have  decreased   for  some  part-time   workers,  but                                                      
they made more money for fewer hours.                                                                                           
CO-CHAIR   FIELDS   asked   about   the  high-profile    study   that  Mr.                                                      
Beane  cited.    Representative    Fields  said  that  he  recalled   that                                                      
it  was   released   prior   to  peer   review.     He   asked  what   the                                                      
methodological flaws were with the study.                                                                                       
MR.   BEANE  responded    that  part   of  the   problem   was   that  the                                                      
researchers   could  only  consider   a small  subset   of the  workforce                                                       
-  about  40 percent   -  because  they  could  only  look  at  a  certain                                                      
size  business  over  time.   When  they  repeated  the  study,  they  had                                                      
a completely different finding.                                                                                                 
REPRESENTATIVE    HOPKINS   asked  what   the  people   who  opposed   the                                                      
minimum  wage  are  now  saying  about  the  impact  on  the  economy  [of                                                      
MR.   BEANE  replied    that  the   restaurant    owners   have  adjusted                                                       
restaurant    management   to   accommodate   the   minimum   wage.     He                                                      
continued with slide 9, which read:                                                                                             
           • Workers are not losing their jobs                                                                                  
                 • Workers experienced no significant decline                                                                   
                    in their likelihood of being employed                                                                       
           • Workers are less likely to job hop                                                                                 
                 • Minimum wage increase was associated with                                                                    
                    an 8% reduction in turnover rates                                                                           
4:29:12 PM                                                                                                                    
MR.  BEANE  described   a  second  study  shown  on  slide  10,  entitled                                                       
"Study 2 Food Service Workers Paid More," which read:                                                                           
      Berkeley study of Seattle food service and restaurant                                                                     
         • Wages increased, especially in businesses without                                                                    
              • Biggest wage gains were in limited-service/                                                                     
                 fast food restaurants                                                                                          
         • Workers are not losing their jobs                                                                                    
              • Employment remained stable, even in fast                                                                        
                 food franchises that predicted disemployment                                                                   
MR.  BEANE  relayed   additional  statistics   from  slide   11, entitled                                                       
"Higher   Minimum   Wages  Improve   Race   and  Gender   Equity,"   which                                                      
         • Before the minimum wage ordinance in Seattle:                                                                        
              • 40% of Black, API and Latino workers made <                                                                     
              $15, compared to 25% of white workers                                                                             
              • 34% of women made < $15, compared to 27% of                                                                     
         • In states with low minimum wages, the gender pay                                                                     
           gap is 25% wider                                                                                                     
MR.  BEANE   gave  examples   of  the  gender  pay  gap   in two   states:                                                      
Wyoming  has  a  minimum  wage  of  $7.25  and  a  woman  makes  $.64  for                                                      
every  $1  a man  makes;  New  York  has  a  minimum  wage  of  $15  and a                                                      
woman makes $.89 for every $1 a man makes.                                                                                      
MR.   BEANE   continued   by   discussing    the   relationship    between                                                      
minimum   wage  and  the   economy.    He  mentioned    the  "middle-out"                                                       
theory   of  economics,   which  maintains   that   if  low-wage   workers                                                      
have  more  money,   they  will  spend  it  in  local  businesses   which,                                                      
in  turn,   spurs  the   economy.    He   reviewed   the  information   on                                                      
slide   12,   entitled    "Higher   Minimum    Wages   Improve   Economic                                                       
Equality and Prosperity," which read:                                                                                           
      Higher minimum wages:                                                                                                     
         • Increase consumer spending and spur investment in                                                                    
           the economy                                                                                                          
              • Low-wage workers are more likely than others                                                                    
                 to spend extra earnings immediately on                                                                         
                 previously unaffordable goods and services                                                                     
              • A $2.55 increase in federal minimum wage                                                                        
                    • Increase earnings of low-wage workers                                                                     
                       by $40 billion                                                                                           
                    • Increase economic activity by $25                                                                         
                    • Generate 100,000 new jobs                                                                                 
         • Reduce income inequality                                                                                             
              • For each $1 increase in minimum wages, 0.3%                                                                     
                 of income redistributed from top to bottom                                                                     
MR.  BEANE   referred   to  slide   13,  entitled   "Cities   and   States                                                      
Adopting   $15  Minimum  Wage,"   to point   out the  cities   and  states                                                      
that  have   passed  a  $15  minimum   wage  since   Seattle   passed  the                                                      
minimum   wage.     He  added   that  there   is  now  proposed    federal                                                      
legislation   to  enact  a  $15  minimum   wage.    It is  believed   that                                                      
there  are  about   21  million  workers   on  a  path  to  having  a  $15                                                      
minimum   wage.    The  cities   are:    Flagstaff,   Arizona;   Belmont,                                                       
Cupertino,   El  Cerrito,   Los  Angeles,   Mountain   View,   Palo  Alto,                                                      
Redwood,   Richmond,   San   Francisco,   San  Jose,   San  Mateo,   Santa                                                      
Clara,  and  Sunnyvale   -  in  California;   Minneapolis   and  St.  Paul                                                      
in  Minnesota;   Greensboro,    New  York  City,   and  Syracuse   in  New                                                      
York;  Greensboro,   North   Carolina;   Portland,  Oregon;   Pittsburgh,                                                       
Pennsylvania;     and    SeaTac,    Washington.        The   states    are                                                      
California,   Massachusetts,   New  Jersey,  New  York,  and  Washington,                                                       
MR.  BEANE  pointed   out  the  companies  that  have   seen  the  minimum                                                      
wage  as  a  positive  development,   as  shown  on  slide  14,  entitled                                                       
"Companies Adopting $15/Hour Minimum Wage," which read:                                                                         
         • Ben & Jerry's: $16.92                                                                                                
         • J.P. Morgan Chase & Co: $16.40                                                                                       
         • Aetna: $16                                                                                                           
         • Amazon: $15 for 350,000 full-time, part-time,                                                                        
           temporary and seasonal employees                                                                                     
         • Charter Communications: $15                                                                                          
         • Costco: $15 for 245,000 employees in U.S. and                                                                        
         • Facebook: $15 for contractors                                                                                        
         • Nationwide Mutual Insurance: $15                                                                                     
         • University of California: $15                                                                                        
         • Walt Disney theme parks: $15                                                                                         
CO-CHAIR    KREISS-TOMKINS    asked    which   of   the   listed    states                                                      
currently have an effective $15 minimum wage.                                                                                   
MR.  BEANE   expressed   his   belief  that   every   state  [listed]   is                                                      
phasing it in gradually.                                                                                                        
REPRESENTATIVE    WOOL  stated   that   he  supports   a  higher   minimum                                                      
wage  in theory.    He suggested   that  many  of the  states  and  cities                                                      
that   have  adopted   the  minimum   wage   are  places   in  which   the                                                      
economies   are  booming.    The  companies   listed  [on  slide  14]  can                                                      
well  afford  it.    He  mentioned   that  small  businesses   or  regions                                                      
with  depressed  economies   - "middle   America"  -  may not  be able  to                                                      
absorb the payroll increase.                                                                                                    
4:35:09 PM                                                                                                                    
MR.  BEANE  responded   that  in  Seattle,   the  small  businesses   were                                                      
given   more  time   to  adjust.     He  mentioned    a  study   in  South                                                      
Dakota,   which  is  a  struggling   rural  economy,   and  there  was  no                                                      
net decrease in employment after raising the minimum wage.                                                                      
REPRESENTATIVE    HOPKINS   suggested   that  the  impacts   to  roadside                                                       
restaurants   could   be  looked   at  in  northern   New  York,   because                                                      
that region can be quite rural.                                                                                                 
CO-CHAIR  FIELDS   added  that  there  are rural  regions   of California                                                       
that   are    demographically     like   Alaska    in   terms    of   high                                                      
unemployment and low wages.                                                                                                     
MR.  BEANE   offered   three  stories   depicting   people   whose   lives                                                      
were  impacted  by  the  minimum  wage  law,  shown  on  slide  15,  which                                                      
      Erin,  barista  for  Compass  Group:  Erin  lives  30  minutes                                                            
      outside  Seattle   to  afford   rent  and  struggled   to  pay                                                            
      bills.  Since   the  minimum   wage  increase,   she  can  pay                                                            
      bills and afford occasional date nights.                                                                                  
      Anthony,  print   shop  attendant  at  Starbucks   HQ:  Before                                                            
      the  minimum  wage  ordinance,   he  moved  in with  a  friend                                                            
      to  avoid   homelessness.    Now   he  can   afford   his  own                                                            
      Darryl,  home  care  worker:  "Now  I have  more  food  at the                                                            
      end  of the  month,  and  I'm  not  trying  to  stretch  those                                                            
      groceries   for  a  week  and  a  half.  I'm  feeding   myself                                                            
REPRESENTATIVE   STORY   referred  to  the  chart  on  slide  2, entitled                                                       
"Seattle's    Minimum   Wage,"    and   pointed   out   that   the   small                                                      
employers   are  in   a  phase-in   period;  and   the  study   Mr.  Beane                                                      
cited   included   the  large   employers,    which   have  had   the  $15                                                      
minimum   wage   since   2018.    She   asked   for  citations    for  the                                                      
studies that Mr. Beane referenced and the sample sizes.                                                                         
MR.   BEANE   said  that   he   could  provide    the  citations.      The                                                      
University   of Washington   study  was  performed  in  October  2018  and                                                      
the  Berkeley  study  was  performed  in  June  2017.   At that  time  the                                                      
minimum wages were approaching $15 or slightly less.                                                                            
REPRESENTATIVE    STORY  asked   for  confirmation   that   the  study  of                                                      
large  employers   runs  from  January   to  October  2018  when  the  $15                                                      
minimum  wage   was in  effect.    The  rest  of  the  chart  [2015-2017]                                                       
shows the phase-in of the wage increase.                                                                                        
MR. BEANE concurred.                                                                                                            
REPRESENTATIVE    WOOL  asked  Mr.  Beane  if  he  has  seen  restaurants                                                       
moving   away   from   tipping   in   response   to   the   minimum   wage                                                      
increase  -  in other  words  -  informing  the  public  that  they  don't                                                      
except  tips,   but there   is a  percentage   increase   in the  cost  of                                                      
the  meal  due  to  paying   higher  wages.    He  said   that  there  has                                                      
already been a trend in that direction.                                                                                         
MR.  BEANE  mentioned   that  many  of  the  restaurants   that  moved  in                                                      
that  direction   are going   back  to tipping   due to  competition   for                                                      
service  industry   employees;   the employees   wanted  tipping   because                                                      
they  made   more  money.     He  maintained   that  the  job   market  in                                                      
Seattle is very tight.                                                                                                          
REPRESENTATIVE    WOOL  offered  that  eliminating   tipping   only  works                                                      
if all the restaurants participate.                                                                                             
CO-CHAIR   FIELDS  stated  that  in  Alaska,  tipped   employees  are  not                                                      
exempt  from  the  minimum  wage;  Alaska   has  a $10  minimum  wage  and                                                      
employees   earn  tips   in  addition.    He  asked   whether   there  are                                                      
other  states   who  have  adopted   a  $15  minimum   wage  that  do  not                                                      
exempt tipped employees from the minimum wage.                                                                                  
MR.  BEANE  answered   yes,  California  and  Washington.     In Seattle,                                                       
an  employer  must  pay  the  state  minimum   wage  of  $13.50  and  "can                                                      
tip  above  it  to  [$15]."    He  confirmed   for  Representative    Wool                                                      
that  of  the  states  and  cities  [with   the $15  minimum   wage]  some                                                      
have  tipped   employee   exemptions.     He  added  that  generally   the                                                      
states  on  the  West  Coast  do not  have  the  exemptions,   and  states                                                      
on the East Coast do.                                                                                                           
4:41:13 PM                                                                                                                    
ANNA  GODOEY,   Research   Economist,   Center  on  Wage  and  Employment                                                       
(CWED),    University    of   California,    Berkeley,    presented    key                                                      
findings   from  two  recent   studies  with  the  use  of  a  PowerPoint                                                       
presentation,    entitled   "Downstream    effects   of   higher   minimum                                                      
wages."    She  referred  to  slide  2  and  relayed  that  in  the  U.S.,                                                      
there  is  substantial   variation   in  state  and  local  minimum   wage                                                      
policies,   especially   in  the  past   20  years;  there   has  been  an                                                      
uptick   in  the  number   of  states  that   have  implemented    minimum                                                      
wages   well    above   the   federal    level   of   $7.25    per   hour.                                                      
Researchers   have  examined  the  effect  of  minimum  wage  policies  on                                                      
labor  demand   and  whether  employers   respond   to the  higher   wages                                                      
by  hiring  fewer  workers  or  cutting  back  hours.    She  stated  that                                                      
the  studies   she  will   present  move   beyond   the  narrow  economic                                                       
outcomes  to  look  at the  downstream   effects  of  minimum  wages:   1)                                                      
the  effects  of  the  minimum  wage  on  suicides;  and  2)  the  effects                                                      
of the minimum wage on parental labor supply and child poverty.                                                                 
MS.  GODOEY  turned   to slide   3 to  cite  the  first  study,  entitled                                                       
"Can  Economic   Policies   Reduce  Deaths   of  Despair."     She  stated                                                      
that   the   first   study   was  prompted    by   troubling   trends   in                                                      
mortality   of  less  educated  Americans.     For  the first   time  in a                                                      
hundred   years,  life  expectancy   of  Americans   was  declining,   and                                                      
the  decline   was  driven  primarily   by  the  increased  deaths   rates                                                      
from  alcohol,   drugs,  and  suicide.    The  increase   was  especially                                                       
large   among   Americans   without   a  college   degree.     The   study                                                      
sought  to  determine   whether  economic   policies   aimed  at low-wage                                                       
workers  could   make  a difference;   one  of  the  policies  considered                                                       
was minimum wage.                                                                                                               
MS.  GODOEY  moved  on  to slide   4 and  relayed  that  the  researchers                                                       
used  data   from  the  Centers   for  Disease  Control   and  Prevention                                                       
(CDC)  on  all  deaths   from  1999   through  2015.    They   found  that                                                      
neither   policy  -  earned   income   tax  credit   (EITC)  nor   minimum                                                      
wage  -  had any  effect   on drug-related   deaths;   however,  economic                                                       
policies   significantly   affected   the  number  of  deaths   from  non-                                                      
drug suicides.                                                                                                                  
MS.  GODOEY  referred   to  the  graphs  on  slide  5,  which  summarized                                                       
the  key findings:    the  number  of  suicides  among  Americans   with a                                                      
high  school   education   or  less   changed   about  the   time  of  the                                                      
policy  changes.    She  explained   that  the graph  on  the  right  side                                                      
of  slide  5  shows  the  effects   of  a  10  percent  increase   in  the                                                      
minimum   wage;  in  the year   when  the  minimum  wage  increased,   the                                                      
number   of  suicides   dropped   significantly.      She  mentioned   the                                                      
concern   for   spurious   correlations:      in   states   with   booming                                                      
economies   that  implement    higher  minimum   wages,   it  may  be  the                                                      
booming   economy  that  is  correlated   with  improved   mental   health                                                      
and  not  the  policy.    She   pointed  out  from   the  graph,  that  is                                                      
unlikely,   due   to  the   suddenness   of   the  decrease   in   suicide                                                      
rates.   The  trend  in  the graph  indicates   that  it is  the economic                                                       
policy driving the reduction in suicides.                                                                                       
4:45:54 PM                                                                                                                    
MS.  GODOEY  referred   to slide  6  and  stated  that  on average,   a 10                                                      
percent  increase   in  minimum  wage  reduced   the number   of suicides                                                       
by  3.6  percent   among  adults   without  college   degrees;   over  the                                                      
study   period,  that   corresponds   to  a  reduction   in  suicides   of                                                      
about 480 lives per year.                                                                                                       
MS.  GODOEY   turned   to  slide  7  to   introduce   the  second   study,                                                      
entitled   "Parental   Labor   Supply:     Evidence   From  Minimum   Wage                                                      
Changes."     This  study   analyzed  the   impact  of  minimum   wage  on                                                      
families   with  young  children.    She  said   that  the  stereotypical                                                       
minimum   wage   worker   is  a   teenager   who   works   part-time   for                                                      
spending    money;    however,    the   minimum    wage    workforce    is                                                      
remarkably   diverse.    Many minimum   wage  workers  have  children  and                                                      
are  working   to  support  their   families.    The  estimate   used  for                                                      
the  study  is that  around  30  percent  of  minimum  wage  workers  have                                                      
minor   children.      Parents   with  children    face   very  different                                                       
circumstances   and  barriers   than  adult  without   children,  such  as                                                      
the  cost  of childcare.     She added  that  the  researchers   used  the                                                      
current population survey, which is the labor force survey.                                                                     
MS.  GODOEY  moved  on  to slide  8  to relay   the key  findings   of the                                                      
study,  which  are:   higher  minimum   wages  increased  the  employment                                                       
rates   of  parents   and  the   hours  worked;   higher   minimum   wages                                                      
reduced   the  probability   that  low  income  families   would   receive                                                      
income  from   public  assistance   or  welfare.    She  maintained   that                                                      
the  findings   suggest  that   higher  minimum   wages  play  a  role  in                                                      
shifting   the  poorest   families   off   cash  welfare   and   into  the                                                      
labor   force.    For   single   mothers,   the  greatest   effects   were                                                      
among  mothers   of  preschool   age  children  suggesting    that  higher                                                      
minimum   wages   allow   these  women   to   overcome   the  barrier   of                                                      
childcare costs.                                                                                                                
MS.   GODOEY   continued    by  saying   that   the   increases    in  the                                                      
employment    wages    of   parents    have   significant    effects    on                                                      
children.     For   children   whose   mothers   did  not   have   college                                                      
educations,   a  10  percent   increase   in  the  minimum  wage   reduced                                                      
poverty  by  just  under  6 percent;   for children   of single  mothers,                                                       
the   reduction   was   11   percent;   for   preschool    age  children,                                                       
poverty   was down   9.7 percent.     She  maintained   that  the  results                                                      
are   important    because    they   are   so   well   established    with                                                      
literature   linking  childhood   poverty  to  worse  outcomes.   For  low                                                      
income  families,   raising  family   incomes  has  been  found  to  raise                                                      
[children's]    test  scores,   improved   health,   and   even  improved                                                       
economic    self-sufficiency      among    women.       She   said    that                                                      
additionally    there  is  evidence   suggesting   that   children   whose                                                      
parents   are   on   welfare    themselves   have   a   higher   risk   of                                                      
receiving    public   assistance    as   adults.      She   offered   that                                                      
findings   that  higher   minimum   wages  reduce   welfare  receipt   and                                                      
child  poverty   point  to  the   potential   dynamic  effect   of  higher                                                      
minimum  wages;  increasing   wages  today  could  have  a  future  payoff                                                      
of    improved     educational     outcomes     and    economic     health                                                      
MS.  GODOEY   concluded   that   the  two  studies,   as  well   as  other                                                      
studies    ongoing    across    the   country,    point    to   important                                                       
downstream   effects   of minimum   wages  that  go  well  beyond   narrow                                                      
economic outcomes like employment and wages.                                                                                    
4:49:43 PM                                                                                                                    
CO-CHAIR  FIELDS   asked  Ms. Godoey   to specify  the  welfare  programs                                                       
to which she referred.                                                                                                          
MS.  GODOEY  answered   that  the  programs  were  Temporary   Assistance                                                       
for  Needy   Families   (TANF)  and   Aid  to  Families   with  Dependent                                                       
Children (AFDC).                                                                                                                
CO-CHAIR  FIELDS   asked  for a  scenario  that  includes  a  region  most                                                      
demographically     analogous   to   Alaska   that   has   implemented   a                                                      
higher minimum wage.                                                                                                            
MS.  GODOEY  replied  that  she  didn't   have  a good  answer;  however,                                                       
she  mentioned  that  she  has  information  on  other  states  and  would                                                      
provide it to the committee.                                                                                                    
REPRESENTATIVE     STORY   asked   about   the   sample   sizes   in   the                                                      
MS.  GODOEY   responded   that  for  the  mortality   study,   the  sample                                                      
consisted   of   all  U.S.   deaths   from  1999-2017    minus   the  four                                                      
states  that  do  not provide  education   data  on the  death  records  -                                                      
46  states  plus  Washington,  D.C.    For the  "Parental   Labor  Supply"                                                      
paper,   the  study  population    was  from  the   labor  force   survey;                                                      
therefore,    the  sample   size   is   large   -  in  the   hundreds   of                                                      
thousands.    The  sample  of  parents  with  high  school   education  or                                                      
less  since   1980  consisted   of  280,000  observations;    eliminating                                                       
anyone  earning   $15  per  hour  measured   in  2016  dollars,  resulted                                                       
in 125,000 observations.                                                                                                        
REPRESENTATIVE     STORY   asked   for   the   standard   error   of   the                                                      
MS.  GODOEY   answered   that   she  could  provide   that   information;                                                       
however,   she  offered   that  all   the  effects   that  she  discussed                                                       
were significant at the 5 percent level or better.                                                                              
4:53:53 PM                                                                                                                    
REPRESENTATIVE    GERAN  TARR,   Alaska   State  Legislature,    as  prime                                                      
sponsor   of  HB  28,  presented   the  proposed   legislation   with  the                                                      
use  of   a  PowerPoint   presentation,    entitled   "House   Bill  28  -                                                      
Equal   Pay  &  Minimum   Wage."    She  referred   to   slide  2  of  the                                                      
presentation,   entitled   "Top  5  Myths  About   Minimum  Wage,"   which                                                      
         head2right Myth 1 - History of Minimum Wage                                                                            
         head2right Myth 2 - Who is the Minimum Wage Worker?                                                                    
         head2right Myth 3 - Increasing Wages Harms the Economy                                                                 
         head2right Myth 4  Has to be One Size Fits All                                                                         
         head2right Myth 5  Leads to Job Loss                                                                                   
         head2right Moving towards evolution of a system                                                                        
REPRESENTATIVE    TARR  turned   to  slide  3,  entitled   "2019   Minimum                                                      
Wage in Alaska," which read:                                                                                                    
         head2right 2014 Ballot Initiative raised minimum wage from                                                             
           $7.75 to $8.75 on January 1, 2015, then again to                                                                     
           $9.75 per hour on January 1, 2016                                                                                    
           head2right Added an annual inflation adjustment to remain                                                            
              $1.00 higher than federal minimum wage                                                                            
           head2right Tips do not count toward minimum wage                                                                     
         head2right Passed by 69% of the vote                                                                                   
REPRESENTATIVE    TARR  added   that  the  minimum   wage   in  Alaska  is                                                      
annually   adjusted  with  inflation:    the  2017  wage  was  $9.80;  the                                                      
2018  wage  was  $9.84;  and  the  2019  wage  was  $9.89.    She  offered                                                      
that  one  of  the  challenges   of  a down   economy  is  that  the  wage                                                      
adjustments   may  not be  at the  same  rate  as increases   in the  cost                                                      
of food, housing, and health care.                                                                                              
REPRESENTATIVE   TARR  moved  to  slide  4, entitled   "Myth  1 -  History                                                      
of Minimum Wage," which read:                                                                                                   
         head2right 1938  President Roosevelt signs the Fair Labor                                                              
           Standards Act establishing minimum wage of 25                                                                        
           cents an hour to maintain a                                                                                          
                 "minimum standard of living necessary for                                                                      
                 health, efficiency, and general well-being."                                                                   
REPRESENTATIVE    TARR  continued   with   slide  5,  entitled   "Minimum                                                       
Wage  Increases   Over  the  Years,"   to  point  out  that   even  though                                                      
wages  have  increased   over  the  years   from  1938-2009,   when  wages                                                      
are   adjusted   to  2014   dollars,    buying   power   has  not   always                                                      
increased;    in   other   words,    wages   have   not   kept   up   with                                                      
inflation,   as shown  on  the graph  on  slide  6,  entitled  "Wages  and                                                      
REPRESENTATIVE   TARR  moved  on  to  slide  7,  entitled  "Myth  2  - Who                                                      
is  the Minimum   Wage Worker?"    She  relayed  the  information   on the                                                      
slide:     People   think   that   the   minimum   wage   worker   is  the                                                      
teenager   who lives  at  home  and  works  part-time   after  school  for                                                      
extra   spending   money.    The  reality   is  that   the  minimum   wage                                                      
worker's   average   age  is  35;   88  percent   are  20  or   older;  36                                                      
percent  are  40  or  older;  56  percent   are women;   28  percent  have                                                      
children;   and   on  average,   minimum   wage  workers   earn   half  of                                                      
their family's total income.                                                                                                    
REPRESENTATIVE    TARR  referred   to the  information    in  the  sponsor                                                      
statement    to    relay   that    the   Massachusetts     Institute    of                                                      
Technology   (MIT)   performed   a study   to  establish   what  a  living                                                      
wage  is  for Alaska.    The  study  indicated   that  a living  wage  for                                                      
one  individual   is  $12.89  [per  hour],   which  is  $3 over  Alaska's                                                       
minimum  wage.    For  one  adult  and  one  child,  the  living  wage  is                                                      
$27.49,    which   she   maintained    demonstrates     the   significant                                                       
disparity between earnings and financial needs.                                                                                 
REPRESENTATIVE    TARR   turned   to   slide  8,   entitled   "Myth   3  -                                                      
Raising Wages Hurts the Economy," which read:                                                                                   
   head2right 18 other states increased minimum wages in 2019                                                                   
   head2right Eighteen states began the new year with higher minimum                                                            
         head2right Eight states (Alaska,   Florida,     Minnesota,                                                             
           Montana, New Jersey, Ohio, South Dakota and                                                                          
           Vermont) automatically increased their rates                                                                         
           based on the cost of living                                                                                          
         head2right 10 states (Arizona,   Arkansas,     California,                                                             
           Colorado, Maine, Massachusetts Missouri, New                                                                         
           York, Rhode Island and Washington) increased                                                                         
           their     rates     due    to    previously      approved                                                            
           legislation or ballot initiatives.                                                                                   
         head2right Other states that will see rate increases during                                                            
           the 2019 calendar year include D.C., Delaware,                                                                       
           Michigan and Oregon (NCSL)                                                                                           
REPRESENTATIVE    TARR  referred   to a  National   Conference   of  State                                                      
Legislatures    (NCSL)  report,   included   in  the  committee    packet,                                                      
which   further   details   the  minimum   wage   laws   enacted   in  the                                                      
various   states.    She  pointed  out  that   most  of  the  states  that                                                      
raised   their  minimum   wages   did  it  gradually   over   time.    She                                                      
mentioned   that  Missouri  passed   a minimum   wage  ballot  initiative                                                       
last  fall;   it  currently   has  a  minimum  wage   of  $8.60  and  will                                                      
increase   it to  $12  effective  1/1/23.    She  also  cited  Michigan's                                                       
minimum   wage  -  currently   at   $9.25  -  to  undergo   a  multi-year                                                       
increase   resulting  in  $12.05   by 2030.    She  added  that  the  cost                                                      
of living in both states is less than Alaska.                                                                                   
REPRESENTATIVE    TARR   stated   that  there   are   13  states   with  a                                                      
higher  minimum   wage  than  Alaska;  some  have  bigger  economies   and                                                      
have   a  higher   cost   of  living;   however,   some   do  not.     She                                                      
mentioned   that  Arizona   and  Maine  have  $11  minimum  wages;   these                                                      
two states are like Alaska in cost of living.                                                                                   
4:59:29 PM                                                                                                                    
REPRESENTATIVE   TARR  referred   to slide  10,  entitled  "Myth  4  - Has                                                      
to be One Size Fits All," which read:                                                                                           
   head2right Current Alaska Law has many exemptions                                                                            
   head2right Alaska Wage and Hour Act requirements do not apply to                                                             
      any individual employed as follows:                                                                                       
         head2right In agriculture                                                                                              
         head2right In domestic service (babysitting) in a private                                                              
         head2right Youth under age 18 employed part-time for not                                                               
           more than 30 hours a week                                                                                            
         head2right A person licensed and employed by a guide or                                                                
           master guide                                                                                                         
REPRESENTATIVE    TARR  moved   on  to  slide  11,  entitled   "Myth   5 -                                                      
Leads  to  Job Loss,"  and  cited  an  article,  entitled   "Argument  for                                                      
and  Against  the  $15 Minimum   Wage for  Health  Care  Workers"   [by J.                                                      
Paul  Leigh,   PhD,  American  Journal   of  Public  Health,   2019],  not                                                      
included   in the  committee   packet.    She  offered   that  the  health                                                      
care  industry   is  the   fastest  growing   industry   in  Alaska,   but                                                      
workers  tend  to  be  lower  wage  employees.    In  addressing  Myth  5,                                                      
she  relayed  the  research   findings  summarized   on  slide  11,  which                                                      
   head2right Research does not support this                                                                                    
   head2right Could be that fewer new jobs, but employees in those                                                              
      jobs are paid more                                                                                                        
   head2right Research on health care workers accounted for this and                                                            
     showed that increasing wages would lead to a reduction                                                                     
      in poverty rates of 27%, not 50%                                                                                          
   head2right Demonstrating the difference between all workers                                                                  
      getting $15.00 and a reduced workforce getting $15.00                                                                     
REPRESENTATIVE   TARR  turned  to  slide  12,  entitled  "Evolution   of a                                                      
System," which read:                                                                                                            
         head2right Workers work full-time, but still qualify for                                                               
         head2right Workers depend on government funded programs for                                                            
           healthcare, childcare, and food                                                                                      
      With Living Wages                                                                                                         
         head2right Workers work full-time and can afford to purchase                                                           
           healthcare, childcare, and food                                                                                      
      Researchers estimate that if the federal minimum wage                                                                     
      were raised from $7.25 to $10.10 per hour would save                                                                      
      $4.6 billion in food stamps                                                                                               
REPRESENTATIVE    TARR  mentioned   the  economic   inefficiency   of  the                                                      
transfer   of  money   considering   the   cost  of  administering    such                                                      
programs.     She  stated   that  the  average   monthly   case  load  for                                                      
food  stamps   in  Alaska   for  FY   18  was  41,945;   for  the   Women,                                                      
Infants,   and  Children  (WIC)   program,  the  case  load   was  17,092;                                                      
11,358  individuals   participated   in  breastfeeding   counseling;   the                                                      
WIC   Farmers'    Market    Nutrition    Program    (FMNP)   had    10,000                                                      
participants;   and   there  were  203,000   Medicaid  recipients.     She                                                      
explained    that    all   these   programs    are   income-based;     she                                                      
advocated   for  a  system   that  supports   "the   dignity  that   comes                                                      
from people being paid a good wage for their hard work."                                                                        
CO-CHAIR  FIELDS   posed  the questions:    Has  anyone  modeled   impacts                                                      
on  state   budgets   of   higher  wages   and   reduced   dependence   on                                                      
welfare and is such modeling possible?                                                                                          
[HB 28 was held over.]                                                                                                          

Document Name Date/Time Subjects
HB028 Version A 4.11.19.PDF HSTA 5/9/2019 3:00:00 PM
HB 28
HB028 Sponsor Statement 4.11.19.pdf HSTA 5/9/2019 3:00:00 PM
HB 28
HB028 Sectional Analysis 4.11.19.pdf HSTA 5/9/2019 3:00:00 PM
HB 28
HB028 Supporting Document - Letter of Support 1.28.19.pdf HSTA 5/9/2019 3:00:00 PM
HB 28
HB028 Supporting Document - Letter of Support 1.22.19.pdf HSTA 5/9/2019 3:00:00 PM
HB 28
HB028 Fiscal Note DOLWD-LMI 4.27.19.pdf HSTA 5/9/2019 3:00:00 PM
HB 28
HB028 Fiscal Note DOLWD-WH 4.26.19.pdf HSTA 5/9/2019 3:00:00 PM
HB 28
HB028 Fiscal Note OOG-HRC 4.26.19.pdf HSTA 5/9/2019 3:00:00 PM
HB 28
HR011 Sponsor Statement 5.9.19.pdf HSTA 5/9/2019 3:00:00 PM
HR 11
HB028 Supporting Document - Anna Godoy Guest Presentation 5.9.19.pdf HSTA 5/9/2019 3:00:00 PM
HB 28
HB028 Supporting Document NCSL Minimum Wage Summary 5.10.19.pdf HSTA 5/9/2019 3:00:00 PM
HB 28
HB028 PowerPoint Presentation 5.10.19.pdf HSTA 5/9/2019 3:00:00 PM
HB 28
HB028 Supporting Document - Andrew Beane Guest Presentation 5.9.19.pdf HSTA 5/9/2019 3:00:00 PM
HB 28
HR011 ver M 5.8.19.PDF HSTA 5/9/2019 3:00:00 PM
HR 11
HR011 Supporting Document-City of Kake resolution 5.8.19.pdf HSTA 5/9/2019 3:00:00 PM
HR 11
HR011 Supporting Document-OVK resolution 5.8.19.pdf HSTA 5/9/2019 3:00:00 PM
HR 11
HR011 Fiscal Note 5.13.19.pdf HSTA 5/9/2019 3:00:00 PM
HR 11