Oregon Restaurant Association and Small Town Living Wage Efforts Collide

Priority legislation for the Oregon Restaurant Association is a bill (HB 2744) that sets limits on local governments raising the minimum wage. "This bill is troublesome since it unfairly hurts efforts, especially in small towns, to meet the rising cost of living. But so far they have been successful and it is probably no coincidence that every legislator who voted yes on this bill in the House also received campaign contributions from the Restaurant Association PAC.," says Kelley Weigel, co-director of the Scappoose-based Rural Organizing Project. Weigel is also a living wage and campaign finance reform advocate.

The Oregon Restaurant Association spends a lot of money on politics as demonstrated by its number 10 ranking in 2000 contributions. Contributions to candidates last year totaled $259,574 while they gave $306,797 to 1998 candidates. The ORA spent $282,220 on lobbying in 2000 and $395,796 in 1999. Lobbying expenditures for the 2001 legislature won't be known until the end of this year but the 1999 figure reflects spending during the last legislative session. The current Senate with Senators elected in 1998 and 2000 received a total of $67,580. Current members of the Oregon House received $142,943 in Oregon Restaurant Association campaign contributions.

This legislation began as a total pre-emption of the right of local governments to increase the minimum wage in their communities. Five communities in Oregon have passed living wage ordinances and the ORA wants to stop this trend. None of those five living wage ordinances apply to private businesses like restaurants. Rather living wage ordinances apply to wages paid to:

• government workers,
• workers for government contractors, and
• workers at businesses that receive tax dollar subsidies or abatements.

A living wage is higher than the minimum wage and is an estimate of what it really takes to support a family.

HB 2744 has been amended to allow for local living wage ordinances that apply to government workers and employees of local government contractors. But a Senate committee amendment only allows local governments to require companies that receive tax payer funded subsidies or are given tax exemption to pay their workers a living wage if the company has 50 or more employees.

"The number of employees provision is a significant loophole since 80% of Oregon companies (of those with any employees) have fewer than 50 employees," says Jeff Thompson of the Oregon Center for Public Policy. "Any of those 80% of Oregon companies that received tax subsidies could still pay their workers minimum wage." Often those workers can't make ends meet and use government services such as food stamps. Living wage advocates believe that if a company receives taxpayer subsidies it should pay its workers enough to avoid those employees needing to use government services.

The effect of exempting smaller companies from the Senate committee amendment to HB 2744 hits rural Oregon especially hard. "For example, 61% of Baker County workers are employed by businesses with fewer than 50 employees while smaller companies employ only 30% of Multnomah County workers," notes Jeff Thompson of OCPP. Living wage activists, especially those working in small town Oregon, oppose HB 2744. Nevertheless the House passed this legislation and a vote is expected soon in the Oregon Senate.

"I'm not quite sure what the Restaurant Association was trying to solve since none of Oregon's living wage ordinances apply to any restaurants or other private businesses unless they receive tax subsidies. The amendments help restore local control over wages, but in a small community like Ashland only being able to apply higher wage requirements to companies with 50 workers or more if they receive tax benefits is a real problem," says Rich Rhode. Rhode is director of Rogue Valley Oregon Action and a leader in an effort to pass a living wage ordinance in Ashland.

Rural Oregon has fewer living wage jobs than larger cities," says Kelley Weigel. "On one hand the legislature talks about supporting rural economic development with tax subsidies. But if those subsidies go to the typical smaller companies in rural Oregon, HB 2744 would prohibit the community from requiring that those companies pay the higher wages that rural Oregonians desperately need. HB 2744 is telling Oregonians what they can and cannot do and we don't need that anywhere, but especially not in rural Oregon. I hope the voices of Oregonians can be heard over the campaign contributions of the Restaurant Association."