Mayor Faulconer vetoes minimum wage ordinance

SAN DIEGO - A decision on whether the City Council will vote to override Mayor Kevin Faulconer's veto of a council-approved ordinance to increase the minimum wage will not be made immediately, Council President Todd Gloria said.

On Friday, Faulconer vetoed the City Council-approved ordinance that would incrementally increase the minimum wage in San Diego to $11.50 and mandate that employers offer five paid sick days to workers each year.

The City Council has 30 days from Friday to consider an override, and Gloria said in a statement the council will consider overriding the veto. Scheduling a vote to override the veto could prove problematic with the council set to begin a four-week recess Friday, and no council meetings scheduled until the second week of September.

Faulconer held a news conference flanked by small business owners who joined him in opposition to the ordinance, approved on a 6-3 vote by the City Council in July.

"Today I'm vetoing the City Council's wage ordinance because we need these and other small businesses to thrive," Faulconer said. "This wage ordinance would make it harder for them to hire and employ San Diegans who need work ... The burden of the council's wage ordinance falls squarely on the shoulders of San Diego's small businesses and the families who they employ."

Faulconer said San Diego's small businesses compete with "restaurants in Poway, stores in Chula Vista and shops in National City that won't face this same increase."

With six council members supporting the wage increase, the mayor's veto will likely fall victim to an override. It would take at least a 6-3 council vote -- two-thirds or more -- to override Faulconer's decision.

"When 38 percent of San Diego workers don't earn enough to make ends meet, something must be done," Gloria said. "That is why the mayor's veto of this reasonable, common-sense measure is disappointing. Thankfully the City Council understands that our working families are struggling, and I believe will act to override this veto."

If none of the council members change their previous votes - Mark Kersey, Scott Sherman and Lori Zapf cast dissenting votes in July -- it could set the stage for a referendum.

Business interests have qualified two referendums over the past year, forcing the council majority to repeal one of its actions and place the other before a public vote -- where it lost.

Gloria originally proposed having residents vote on the minimum wage in November, but the council majority wanted to adopt the wage hike directly.

Former Mayor Jerry Sanders, who now leads the San Diego Regional Chamber of Commerce, commended the mayor's veto of the ordinance, which he said would put San Diego at a competitive disadvantage to nearby cities.

"Mayor Faulconer showed strong leadership in making this decision that protects the San Diego economy, particularly our small businesses and jobs," Sanders said. "We urge City Council to accept the mayor's veto and not override this ordinance which will hurt working families, San Diego consumers and employers."

The organization Rise Up San Diego issued a statement saying the mayor's veto denied "hundreds of thousands of working people access to sick days and a raise," and compared San Diego's ordinance with a similar one passed in San Jose.

"Given the success San Jose has had with its minimum wage ordinance, I and a lot of other San Diego business people are surprised Mayor Faulconer vetoed ours," said businessman Mel Katz. "There's significant proof that the San Jose minimum wage has helped that city's economy -- a similar ordinance could help ours."

There were several people on both sides of the issue at the news conference.
Viviana Lagunas, a senior at San Diego State University who also works part-time as a cashier, said, "We're living in poverty. We have two, three jobs; everyone in the household is working and we still can't make ends meet."

On the other side 10News spoke to Point Loma bookstore owner Ann Kinner, who's already struggling to stay open.

She said, "If my cost for my employee goes up too much more, if my costs for running the business goes up too much more, I may even be in a position of trying to decide, 'What's the point of being in business?'"

Faulconer released this full statement Friday:

“San Diego is at its best when everyone has the opportunity to find employment and pursue the American Dream. I have vetoed City Council Ordinance O-2015-11 REV. because it threatens these opportunities, making it harder for San Diegans to find work.

“Just like our own health, our local economy needs balance and moderation to flourish and prosper. This ordinance weakens San Diego’s ability to create and retain jobs by putting heavier burdens on small businesses compared to nearby cities, permanently tipping the scales to the disadvantage of San Diegans seeking employment.

“The timing and scope of this regulation willfully ignores recent legislation passed at the State Capitol. Local workers are already receiving a pay increase regardless of this ordinance; California workers will see a 25 percent raise over the next three years through a wage bill signed by Governor Brown. The City Council’s proposed ordinance will add an increase on top of that – resulting in a combined 44 percent increase just in San Diego, with annual escalations every year in perpetuity that go well beyond the state’s plan. This ordinance will create new costs unique to San Diego, jeopardizing small businesses and the hard working families they employ.

“The family-owned grocery stores, mom-and-pop restaurants and neighborhood boutiques that San Diegans love will be hardest hit. Some large-scale chains are better equipped to absorb the added expense. It’s the shops owned by our fellow San Diegans – the local success stories that bring our community pride – that are at risk.  Add on top of that the chilling effect this could have on entrepreneurs who want to start a new business in San Diego.

“The City Council’s authority stops at the city limits, but the principles of economics do not. As job creators leave for other cities without anti-business legislation, San Diegans will be deprived of jobs and economic advancement. Unfortunately, the jobs this ordinance seeks to affect could be the first to disappear.

“As Mayor, it is my job to cultivate an atmosphere that creates economic opportunities for all San Diegans. Working families and the small businesses that they power are the backbone of our economy, and City leaders should be doing everything they can to ensure they succeed.

“This ordinance unfairly pits working families and our city against economic realities that will make it even harder for San Diego to thrive. I cannot support putting the brakes on our economy. I believe we can and must work together in unison – workers, businesses and government – to move San Diego forward.”

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