Finance Highlights 2006 1206 - Laserfiche WebLink

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~'- 'John Jermanis January 8, 2004 The cost of implementation for the Port of Oakland can be seen in part through a July 2003 study titled "Living Wage Implementation at the Port of Oakland, One Year Status Report" that was completed by the East Bay Alliance for a Sustainable Economy. The report indicates that the Port of Oakland, in order to effectively monitor and implement the living wage law, created a full-time "Sustainable Wage Specialist" position in May 2003. The Sustainable Wage Specialist position is responsible for monitoring and enforcing the living wage law and prevailing wage regulations. Enforcement in the first year was done through a framework created by the Port that included aself-evaluation checklist, living wage compliance checklists, self-certification statement forms, and notice programs for tenants at the airport. Although these tools are in place, the Port has experienced serious gaps in the monitoring of firms. The database of covered businesses is substantially incomplete due in part to the non-cooperation of some covered businesses. The report recommended that the Port begin to complete proactive measures to gain further compliance with the living wage law, including site visits and employee interviews. The recent adoption of a living wage law in Sacramento helps to illustrate the potential administrative cost of this legislation. In December 2003, Sacramento passed a living wage law that will require a minimum wage for 2004 of $9.00 per hour for employees with health benefits and $10.50 per hour for employees without health benefits. Furthermore, the wage floor will rise by $.SO per hour in both 2005 and 2006. The ordinance will apply to companies with 2S or more full-time employees on contracts worth a minimum of $100,000. Nonprofit companies with 100 or fewer employees are exempt. The ordinance also exempts professional service contracts, Emergency service providers, and student internships. It applies to all full-time City employees but exempts seasonal municipal workers. City special project manager Michael Medema estimated that the cost for administration will be approximately $100,000 per year. Finally, an unknown administrative cost to jurisdictions with living wage laws are the potential legal costs incurred defending or enforcing the ordinance. For example, the City of Hayward in November 2003 stepped in as a party to aclass-action lawsuit against Cintas Corporation in order to defend the constitutionality of Hayward's living wage law. The costs for the City of Hayward to participate in this lawsuit are unknown.