Minimum wage increase bill draws cold response at hearing

Colin Bonini

DOVER — A bill to raise the minimum wage by $2 in 50-cent annual increments met an unfavorable public response Wednesday in a hearing before the Senate Labor Committee

At the end of the discussion, Sen. Colin Bonini, R-Dover, motioned to table the bill, but lost the committee vote 3-2 among the committee.

The bill was moved out of committee and released to the Senate floor.

The current minimum wage in Delaware is $8.25. The bill would hike it to $10.25 by 2020.

The legislation calls for increasing the minimum wage by 50 cents per year beginning this year. After 2020, the minimum wage would increase based on cost-of-living adjustments under the federal Social Security Act.

In addition, the bill would require employers to pay an increased minimum wage based on cost-of-living adjustments under the federal Social Security Act in any year in which the federal minimum wage does not increase.

During the public hearing, several business owners, organization leaders, farmers and retailers turned out to offer their opinion on the bill. Of the 19 that offered comments, five were in favor and 14 were against the bill.

Several business said a higher minimum wage would sap their competitiveness, force them to cut staff and reduce employees’ hours.

Curt Fifer of Fifer Orchards in Camden Wyoming spoke out against the bill at the hearing.

“Labor is such a huge part of growing fruits and vegetables,” he said “It’s by far the biggest expense, and we as farmers hire a lot of low-skilled low-wage workers to pick these crops, so when you change the minimum wage it bumps everything up. It affects the farming industry probably worse than any in the state.”

Employing about 160 people, Mr. Fifer said past minimum wage rises have caused serious problems for his family farm.

“We just had an increase in the minimum wage from $7.25 to $8.25 in 2014-15,” he said. “Since our business pays out about 200,000 seasonal hours that increase knocked $200,000 out of our bottom line and we felt it as a business.

“Just like any fruit or vegetable farm in the state, we ship most of our products out, so we compete with farmers from other states. A farm identical to ours in a state with the federal minimum wage of $7.25 is going to have a $3 per hour advantage over us. They’re going to price us out.”

Also speaking against the bill, Sen. Bonini said that the public should try to see it “in context.”

“It’s a tremendously important issue,” he said. “The context to keep in mind is that Delaware’s economy is sputtering at best right now. We have one of the lowest labor force participation rates in the country.

“Our state government, which is a reflection of our economy, is also looking at significant financial difficulties as well. I think it’s critically important when we look at these bills to consider the downstream impacts.”

Speaking in favor of the bill, Sandy Spence with the League of Women Voters of Delaware said that many of the state’s economic ills are the reason the bill must be passed.

“We have so much poverty and low income in this state,” she said. “Reductions in poverty correlate historically with real income increases in minimum wage.

“Also, the thing that really troubles us is declining upward mobility and growing political and economic inequality perpetuate harmful social conditions that underlie civil society.”

Noting that Maryland’s current minimum wage is $9.25 and set to rise to $10.10 in 2018, the bill’s primary sponsor Sen. Robert Marshall, D-Wilmington, said that many of the arguments offered in the public hearing are the same as they’ve always been.

“The business owners expressed the traditional opposition, which I expected,” he said. “Then you had other private citizens representing a variety of other organizations that express support for the bill. They may have been outnumbered but it’s the historical type of argument. That same monolithic voice has been expressing that same public opposition for the past 25 years. It’s all up to debate now.”

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