OAKLAND -- Council members turned aside a business-backed minimum wage hike Tuesday they feared could have been used as a weapon to defeat a more generous labor-backed initiative on the November ballot.

The 5-3 vote underlined the growing momentum across the Bay Area for minimum wage increases to help poorer workers deal with rising prices, especially for housing. It also highlighted the political might of Lift Up Oakland, a coalition backed by the powerful union SEIU Local 1021, which collected more than 30,000 signatures to place on the ballot an across-the-board $12.25 hourly minimum wage in Oakland.

Oakland City Council Chambers were the site of the city’s official installation ceremonies, Monday, Jan. 7, 2013 at City Hall in Oakland, Calif. (D.
Oakland City Council Chambers were the site of the city's official installation ceremonies, Monday, Jan. 7, 2013 at City Hall in Oakland, Calif. (D. Ross Cameron/Staff)

Several council members fear that the measure, which increases the minimum wage from $9 per hour, could harm small businesses and imperil nonprofit service providers whose wages are tied to reimbursements from the state.

But a majority of council members nevertheless have endorsed the proposal, and opponents had failed in recent weeks to rally support for the council to put a competing measure on the ballot.

The proposed ordinance rejected on Tuesday would have incrementally increased the minimum wage to $13.50 by 2018 and exempted certain nonprofits. However, most of its key provisions would have been trumped by the upcoming ballot measure -- a fact that made several council members question whether they were being asked to help business interests fight the more worker-friendly minimum wage hike.


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"I do think that if we do something tonight it will be used as a campaign tactic to defeat the citizens-based initiative, and I am uncomfortable with that," Councilman Dan Kalb said.

The Oakland Metropolitan Chamber of Commerce has not yet decided if it will actively oppose the minimum wage ballot measure, its president, Barbara Leslie, said after the council vote. A recent poll by a pro-business group found more than 70 percent of likely voters supported the measure, which only needs a simple majority to pass.

Council members Pat Kernighan, Larry Reid and Lynette Gibson McElhaney supported the business-backed proposal.

The vote came after testimony from dozens of residents on both sides of the issue. Several speakers said the business-backed plan contained too many loopholes employers could exploit to avoid paying higher minimum wages. Adrianna Carranza, who works at a food stall in the Oakland International Airport, said her employer purposely operates several smaller businesses to get around a wage law that applies to larger businesses at the airport and the Port of Oakland.

"We've been struggling for over two years for jobs we can't live on to support our families and ourselves," she said.

Popular support for minimum wage hikes has surged locally as the economy improved and the cost of living increased.

Berkeley and Richmond both passed minimum wage increases this year. And San Francisco voters will be asked to raise its minimum wage to $15 per hour by 2018.

The hourly minimum wage in Oakland had been set at $8 for six years before a state law pushed it to $9 this month. Under the business-backed plan, it would have nearly doubled to $15 per hour over the next seven years.

Councilwoman Rebecca Kaplan noted the surging support for increasing the minimum wage in voting against the business-backed plan.

"If this had been before us a year ago, it would have been praised as the greatest step forward in worker pay in Oakland in living memory," she said.

Several council members blamed themselves for not taking the initiative on minimum wage and crafting a proposal that would have addressed concerns from small businesses and nonprofits.

But Gary Jimenez, who heads the Lift Up Oakland coalition and is vice president of SEIU Local 1021, said his members were unhappy with minimum wage increases passed by city councils in Berkeley and Richmond and will push for ballot measures in those cities, too.

"We think they took the easy way out of passing something that won't really help workers the way it needs to help them," he said. "It fell way short of what they needed to do."

Contact Matthew Artz at 510-208-6435.