Living Wage Ordinance – Minneapolis

Date: 21 Nov 2008 | posted in: equity | 0 Facebooktwittergoogle_plusredditpinterestmail

In March 1997 the city council unanimously passed a living wage policy requiring businesses benefiting from $100,000 or more in city assistance in one year to pay employees a living wage. The wage will be defined and indexed as 110%of the federal poverty level for a family of four. Recipients of such assistance must also set a goal that 60% of new jobs will be held by city residents. Additional provisions prohibit privatization of services currently performed by city employees that would result in lower wages, and preferences for assistance to union-friendly businesses.

The Minneapolis Community Development Agency filed a 2003 report that establishes the 2003 Minneapolis Living Wage at $9.73 per hour. Here is a link to the Staff Report: 2003 Living Wage.

According to a 2001 Living Wage and Job Linkage Status Report released in July 2002 by the Minneapolis Community Development Agency(MCDA), 82 percent of the 1,274 employees reported on during the year earned wages at or greater than the living wage of $9.33 per hour (2001 level). Nearly 40 businesses participating in Minneapolis’ Living Wage and Job Linkage programs reported on their 2001 hiring activities.



Resolved that The City Council of The City of Minneapolis adopt the following Living Wage Policy:

Preamble:The following recommendations are made in order to assure that whenever Minneapolis invests public funds in economic development projects, those projects create the greatest number of living wage jobs possible for Minneapolis residents. In addition to these specific recommendations, City policy makers must keep the critical need for living wage jabs before them whenever they consider investing public dollars in development projects.

  1. City economic development assistance should require the creation or retention of full time jobs with a living wage –
    1. Except when any of the following conditions are met:
      1. the cumulative assistance package totals less than $100,000 In any one fiscal year; or
      2. the business receiving the assistance is a small business as defined by Minnesota Statute 645.445; or
      3. the recipient is an intermediary, such as a community development corporation or community bank, which serves as a pass-through agency for the granting of assistance.
    2. Assistance in excess of $100,000 in any one fiscal year will trigger Bis provision. For the purpose of this provision, assistance should be broadly defined as:
      1. land sales at less than a fair market price when the amount of the reduction in the sate price below the fair market price exceeds the assistance trigger;
      2. loans (staff will return with administrative guidelines on how loans will be treated under this policy);
      3. bonds excluding conduit bonds (which are subject to existing job linkage requirements
      4. grants; and
      5. City tax incentives

    City economic development assistance relating to projects in which the primary objective is job creation/retention will be more clearly defined in administrative guideiines.

  2. Projects whose only public assistance is site remediation, investigation, and assembly will be reviewed according to Principle Number 6 of this resolution and will be exempt from monitoring and sanctions requirements.
  3. Assistance packages above $100,000 to non-exempted businesses will have to create or retain a fixed ratio of jobs per $100,000. Administrative guidelines will provide suggested ratios by specific job creation or retention program.
  4. A living wage will be defined and indexed as 110% of the federal poverty level for a family of four. Staff are directed to retum to the Council/Minneapalis Community Development Agency Board of Commissioners with recommendations on whether the living wage should be defined as 100% of the federal poverty level for a family of four for businesses that provide employer-paid basic health insurance coverage that meets administrative guidelines.
  5. The Minneapolis Community Development Agency (MCDA) and the Minneapolis Employment and Training Program (METP) shall work with assisted businesses to establish a goal that 60% of new jobs created will be held by City residents. These jobs should be advertised to the entire community including low- income people through community sponsored organizations and/or job linkage programs.
  6. The City of Minneapolis will focus its job creation and retention assistance at businesses which demonstrate a clear and ongoing commitment to the community by providing living wage jobs to their employees and to residents where applicable by giving priority to these businesses over businesses which have not traditionally paid living wages.
  7. All other things being equal and to the extent legally possible, the City of Minneapolis will give preferential status for job creation and retention assistance to businesses that engage in responsible labor relations. Responsible labor relations are defined as neutrality on union organizing, providing a complete and accurate list of names and addresses of employees, reasonable access to employees and ~acilities during non-working periods, voluntary recognition based on a card check demonstrating that a union represents a majority of employees in a bargaining unit, and binding arbitration on the first contract.
  8. The City of Minneapolis, working through the MCDA, will impose sanctions for non-compliance with these requirements,
  9. The MCDA and the METP will report on compliance with these requirements, as a part of the annual job linkage report to the City Council.
  10. Work presently being performed by City employees may not be contracted out unless the contractors pay employees performing that work a living wage or the current City wage and benefits, whichever is higher.
  11. To the extent legally possible, City contracts awarded for service wilI, within four years, beginning in 1997, be awarded to contractors who pay at a minimum a living wage for employees performing that contract service,
  12. The Minneapolis City Council shall direct their purchasing staff to develop by August 1997 policies and practices for contracting and purchasing of goods and services to encourage the creation of living wage jobs.
  13. The City of Minneapolis acknowledges the need for job readiness services for some City residents who face serious social and economic barriers to employability. Many of these residents need to establish a stable work history before they are able to move on to living wage jobs. The City of Minneapolis exempts organizations whose primary mission is to provide job readiness and training services, and whose primary purpose of requesting funding is to provide those services.
  14. The City of Minneapolis will work with the Metropolitan Council and other appropriate state and regional agencies and the legislature to promote common standards consistent along these guidelines for job creation and retention assistance by public development agencies throughout the region.
  15. Although our primary focus is on the creation of living wage jobs where public assistance is received, Minneapolis cannot achieve its economic development goals without a trained and work-ready workforce and adequate day care. Minneapolis will commit to assist area businesses to obtain trained and work-ready employees and to facilitate access to child care.
  16. Administrative guidelines should be developed by the MCDA staff and brought before the MCDA Board of Commissioners for review and adoption. These guidelines should explain in detail how each of the policy recommendations will be implemented.
  17. Because job readiness is a primary challenge to the success of any wage initiative, and because it is of importance to the residents of Minneapolis as well as to businesses that develop here, the Minneapolis City Council directs the METP to report annually on current job readiness, training and apprenticeship activities.
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