A monumental shift regarding how developers relate to working class New Yorkers was introduced in the City Council this week. Intro. # 251, also known as “The Fair Wages for New Yorkers Act” would amend the administrative code of the city of New York, in relation to requiring the payment of a living wage to employees employed on property developed by recipients of financial assistance for economic development.
The living wage bill proposes that any development project that receives public subsidies pay a living wage to employees, defined as $10.00 per hour plus benefits or $11.50 per hour without benefits. The bill would establish a city-wide standard for all development projects that receive public subsidies worth more than $100,000 in the form of tax credits, discounted land sales, or other benefits.
The Fair Wages for New Yorkers Act was introduced by Council member G. Oliver Koppell and sponsored by Council members Koppell, Palma, Arroyo, Cabrera, Chin, Dromm, Ferrera, James, Mendez, Sanders Jr., Mark-Viverito, Foster and Seabrook (by request of the Bronx Borough President), then referred to the Committee on Contracts, Chaired by Council member Darlene Mealy. The Contracts Committee will hold a public hearing, solicit expert testimony, and receive public comments. The bill will go back to the full council for a vote, then be sent to the Mayor for signing. If the mayor vetoes the bill, it will be sent back to the Council, where it will need 34 votes to override the Mayor’s veto.
Council member Barron said the living wage bill is “very important,” and referenced the Gateway ll project, with 2,300 affordable housing units and 600,000 square feet of new commercial space as an example. “This is where the bill helps,” said Barron, “Any business that receives public subsidies must pay a living wage.”
For Barron, Walmart is a classic example of what not to do. “Walmart,” Barron said, “They are the worst when it comes to paying employees fairly. Walmart has $13 billion in annual profit. Walmart’s CEO makes more that $20 million a year. Yet they want to pay workers $2,000 below the federal poverty level. Business can’t rip off labor by paying minimum or below minimum slave wages.”
Barron said Mayor Bloomberg supports developer’s interests, and is against the bill. Barrons suggested low wage workers pack the hearing “like an invasion of City Hall.” He said workers should demand organization, mobilization, and activism. Barron said “I am tired of developers getting rich off the backs of workers. When they get free money, it is called subsidies. When we get free money, it is called welfare.” The current environment, Barron said, “maximizes profits with slave wages and union busting.”
Council member Barron said the Mayor’s argument that the bill will encourage developers to stop doing business is “Nonsense. Related is one of the richest developers in the country. Will Related go broke or leave the city if they pay a living wage? Only middle and working class people making $58,000 or less can no longer afford to live here.” Barron said companies like Related “will continue to build and develop here because they are making money here.”
Marie Louis, CEO of BUILD said the living wage bill “is an important piece of legislation. It would help to insure that people earn the wages they need to afford to live in the city. If someone is working on a project subsidized by public funds, there should be an obligation for those who benefit from public subsidies to pay people decent living wages.”
“There are too many hardworking New Yorkers earning poverty wages, and for too long, city-subsidized developers have earned profits at the expense of taxpayers and low-wage workers,” said Council Member Al Vann. It is time for these developers to provide public benefits to our city’s communities in return for receiving this taxpayer money. Living wage laws, as enforced in other cities and states, have proven to not only be beneficial for workers, but also for local economies. This law would be a critical tool for lifting New Yorkers out of poverty, and therefore I support it.”
Council member Mealy, Chair of the Contracts Committee, was unavailable for comment.
Just one day before introduction of the living wage bill, the Drum Major Institute hosted a forum entitled, “Using Economic Development to Create Good Jobs.”
Comptroller Liu said “The issue is not all economic development. The issue is specifically about economic development that involves large amounts of public subsidies. In these cases, the public needs a far better understanding of exactly what the city does in deciding who or which private developer gets these huge public subsidies. The public is already demanding an answer. The Comptroller’s office is going to do everything we possible can to answer those questions so that the public can better understand what goes into, and comes out of the EDC (the city’s economic development office). When there is a subsidy for economic development, it is absolutely reasonable for public officials and the public to demand that the jobs created are decent jobs, not just minimum wage jobs.”