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County Council Approves Increasing Minimum Wage to $15 by 2020, Critics Say Move is Too Much, Too So

The Montgomery County Council yesterday approved Bill 12-16 that will gradually increase the County minimum wage to $15 per hour by 2020. Five amendments to the original bill were approved before the Council voted 5-4 to approve the amended bill, making Montgomery one of the first jurisdictions in the nation to approve a $15 per hour minimum wage.

Five members of the all-Democratic County Council pushed Bill 12-16 through despite an existing plan to raise the minimum wage in Montgomery County from the current $10.75 an hour to $11.50 per hour on July 20, 2017.

The new Bill, which was sponsored by Councilmember At-Large Marc Elrich, calls for the increase of the County minimum wage incrementally beyond the $11.50 per hour minimum, effective July 1, 2017. The new Bill 12-16 will extend the incremental increases set in County law to go up to $15 per hour effective July 1, 2020, for employers with 26 or more employees. Under the bill’s transition provisions, the County minimum wage for these employers would increase to $12.50 in 2018, $13.75 in 2019 and $15.00 in 2020.

The new Bill will also require, beginning in 2021, annual adjustments to the minimum wage by the annual average increase, if any, in the Consumer Price Index for urban wage earners and clerical workers for the previous calendar year.

Councilmembers Tom Hucker (District 5 – Takoma Park/Burtonsville), George Leventhal (At-Large), Nancy Navarro (District 4 – Olney/Wheaton) and Hans Riemer (At-Large) were co-sponsors of Bill 12-16, and all five voted to approve the amended bill. Councilmembers Roger Berliner (District 1 – Bethesda/Poolesville), Nancy Floreen (At-Large), Sidney Katz (District 3 – Rockville/Gaithersburg) and Craig Rice (District 2 – Germantown/Clarksburg/Damascus) voted against the amended bill.

The County Council had an opportunity to pause and conduct an economic study of the impact that increasing the minimum wage would have on the County. Prior to the vote on the amended bill, the Council considered a proposal to conduct a study and delay voting on a Bill 12-16 until after the study was completed.

However, the same five Councilmembers that pushed the Bill through voted against conducting an economic study on the impact of the actions. The proposal to conduct the study was defeated by a 5-4 vote with Councilmembers Elrich, Hucker, Leventhal, Navarro and Riemer voting against conducting the study. Councilmembers Berliner, Floreen, Katz and Rice supported conducting a study.

The bill now goes to County Executive Ike Leggett for his signature. Bill 12-16 is not quite set in stone yet; there is still a chance the Leggett might veto the bill as constituted. The County Council must pass a bill by a 6-3 margin to avoid the possibility of a County Executive veto.

However, after Leggett raised concerns about the way Bill 12-16 was constructed in November, Elrich and the other supporters introduced amendments to the bill to help sway Leggett’s support for the final bill.

Among the amendments approved was one proposed by Councilmembers Elrich and Leventhal that changes the minimum wage schedule for businesses employers with 25 or fewer employees so that they reach $15 per hour two years later than larger employers. The phase-in schedule for those the smaller businesses employers will be $12 per hour effective July 1, 2018; $12.75 per hour on July 1, 2019; $13.50 per hour on July 1, 2020; $14.25 per hour on July 1, 2021; and $15 per hour on July 1, 2022.

Another amendment proposed by Councilmembers Elrich and Leventhal and approved would give the County Executive the ability to stop pause implementation of a scheduled increase if economic conditions worsen. The conditions that could trigger a pause are: if total private employment for Montgomery County decreases decreased by 1.5 percent over the period from April 1 to June 30 of the previous year; total private employment for Montgomery County decreased by 2.0 percent over the period from Jan. 1 to June 30 of the previous year; the Gross Domestic Product of the United States experiences negative growth for the preceding two quarters: