When the minimum wage hike became official Jan. 1, most local businesses took a wait-and-see approach when asked how they would respond to the sudden increase in employee wages. Some did raise their prices a bit, more or less across the board. Then there were the 7-Eleven franchises in the Aberdeen and Hoquiam area, which immediately added a 25 cent surcharge to every purchase. That surcharge was removed due to heavy pressure by local consumers and long talks with 7-Eleven’s corporate leadership.

One month into the minimum wage hike, local 7-Eleven franchise owner Roger St. George is still working with the 7-Eleven corporate office in Dallas, Tex. to come up with a plan to lessen the impact to his and other local franchise owners’ bottom line.

“I’m still working with corporate,” said St. George. “It’s a very lengthy process to determine the marketplace and the prices out there.”

Duffy’s Restaurant, an Aberdeen institution for more than 70 years, has had to make some minor adjustments, but as with most local businesses the jury is still out as to the long-term effects of the jump in minimum wage.

“We’ve raised prices, just a little bit, trying to cover it,” said owner Ralph Larson, whose son, Paul, is the general management of the family restaurant. “It’s about all we can do.”

Seafood processors provide a lot of jobs in the county, particularly during their peak season from late in April through the Dungeness crab season in the winter. Ocean Gold in Westport employs up to 400 people at the peak of the season, according to their website. Pacific Seafood currently is advertising job openings at its Aberdeen shellfish farm and Washington Crab Producers Westport crab facility, and employs thousands of people at several locations in the state, up and down the West Coast and beyond.

When asked how the minimum wage increase could impact such a large-scale employer of manual and seasonal laborers, Susan Chambers, Deputy Director of the West Coast Seafood Processors Association, provided the following statement:

“West Coast Seafood Processors Association officials said it (increase in minimum wage) is, of course, a big concern. It could drive up work force costs and increase overall production costs. Ironically, the long-term effect could lead to increased job loss as a company may choose to invest in more automation to increase their efficiency and lower production costs.”

Doug Morrill owns several businesses in Ocean Shores including the Ocean Shores Pharmacy and Breezy Beach Clothing on Chance A La Mer. He, like most small business owners, was reluctant to talk about the impacts of the minimum wage hike, but did note his starting pay meets the new minimum state requirement.

State Senator’s bill gets hearing

State Sen. Michael Baumgartner, R-Spokane, has introduced three bills regarding the state’s month-old $11 minimum wage, most significantly one that would lower the minimum wage to $9.53 in all counties except King.

Baumgartner’s bill would provide for incremental state-mandated 50-cent annual raises through January of 2020, when it peaks at the same $13.50 as drafted into I-1433, the citizen initiative that was passed last fall.

According to the bill summary, the bill would delay the provisions of I-1433 for two years in all counties with a population less than 1.5 million. Employers in the 38 counties that are subject to the delay will pay the minimum wage of $9.53 per hour; the amount that was set to be implemented on Jan. 1 if I-1433 did not pass. Beginning on Jan. 1, 2019, these employers will move to the new phased-in minimum wage schedule, starting at $11 per hour, and will be required to pay mandatory sick leave. If passed, the provisions of the bill would be retroactive for Jan. 1, 2017.

The bill was heard last week in the Senate Committee on Commerce, Labor & Sports. Two companion bills also dealing with the state’s minimum wage and authored by Baumgartner were also heard. Senate Bill 5532 would allow nonprofit employers to pay a slightly lower minimum wage; Senate Bill 5541 deals with the minimum wage for employees less than 18 years old.

“I’m sure even the people in King County would agree that their economy is more vibrant than the rest of the state,” said Baumgartner at Thursday’s hearing. “Sen. (Jim) Hargrove used to talk about the two Washingtons: the one of the Peninsula and Eastern Washington, where people are really struggling, versus Snohomish, King and Pierce counties.” It was pointed out early in the testimony that all Eastern Washington counties voted against the initiative, as did Lewis, Wahkiakum and Cowlitz counties west of the Cascades.

Baumgartner noted, “While somebody in King County may not be easily able to reach across and choose a business across the border, that is a very big reality when you work in the Spokane Valley. These are real people losing their jobs and employment because of this initiative. The attempt here is to try to give some people some ramp-up time but allow King to have their initiative.”

Before the hearing, Baumgartner said he had a meeting with early education leaders and “other people that deal with the lower rung of the social safety net” and others who have expressed their concerns about the economic impact of the minimum wage as established by I-1433. “They have pointed out the cost of the initiative and are here to lobby on backfill from the state budget. If you were to ask the (Senate) Ways and Means Chair he would tell you there are a lot of people who want increases to their budgets to pay for increases in minimum wage and the effects of this initiative,” adding with no little sarcasm, “Fortunately, we have so much money in the budget that that will be easy to do and nobody will have to worry about these issues.”

Because the initiative that created the current statewide minimum wage standards was passed less than two years ago, all three of Baumgartner’s bills require a two-thirds majority vote in both the House and Senate to pass.

“During the two-year period after an initiative is passed by voters, it would take a two-thirds vote in the House and two-thirds in the Senate to amend the initiative,” explained Brian Zylstra, spokesman for the State Secretary of State’s Office. “After the two-year period, the House and Senate could amend the initiative with a simple majority.”

At Thursday’s hearing, Baumgartner reminded the committee of an action taken by the Senate in 2016 regarding the class size initiative. “We realized the state couldn’t pay for it and mustered up the two-thirds majority vote to delay that initiative,” he said. “This is a moderation of that approach to the cost of the minimum wage initiative. What we’re attempted to do is add a delay, but do it for outside King County.”