In January 2017, Montgomery County executive Isiah Leggett vetoed a proposed bill which would have eventually raised the county’s hourly minimum wage to $15. The bill in question was passed by the county council by a narrow margin but struck down after the veto. Following some revision, councilmember Marc Elrich reintroduced a new version of the minimum wage bill this past July.
More recently, Leggett asked the council via memo to amend Elrich’s bill by pushing back its effective date and redefining what it means to be a small employer. In the original, the bill was set to take effect in 2020, and “smaller” employers were defined as those with 25 or less employees. Under Leggett’s version, smaller employers will have until July 1, 2024 to implement the minimum wage, and they include all employers who retain 50 or less employees. Large employers would have until July 1, 2022 to implement this new bill.
Even with all these changes, council members are fairly split between accepting and rejecting the new bill. Proponents of the bill include Senator Richard Madaleno; during a public hearing held last month concerning the new minimum wage bill, a representative of Madaleno stated, “most low wage workers…are major breadwinners for their family…A higher minimum wage would put money in the pockets of millions of low wage workers.” He elaborated, discussing how the economy would be boosted by families that are able to spend this newly earned money.
Also during the public hearing, a Montgomery County resident also pointed out that, as a result of the last minimum wage raise this past July, the county has observed “21,000 more jobs, unemployment rate moving from 4.3% to 2.9%, and businesses thriving.” He argues that another raise would thus serve to further benefit Montgomery County workers.
On the other hand, opponents of the bill have cited a study by Public Financial Management Incorporation (PFM) commissioned by Leggett. This particular study concluded that the economy would be negatively affected by the new bill, with projected job loss of up to 47,000 and an aggregate income loss of $400,000.
While these numbers do seem condemnatory, the PFM later admitted to various calculation and methodological errors. The study also faces criticism from residents who believe it is impossible to simulate a workforce, and several council members themselves have expressed skepticism at the study’s findings. According to Bethesda Magazine, Elrich went so far as to call the job loss number “laughable”.
Taking into account these findings as well as input from the community, Leggett’s most recent provisions slow down the implementation of the bill and address major concerns that residents have with this new law. In response to outcry from small business owners, Leggett proposed a 90-day testing period where employers pay employees 85% of the proposed minimum wage.
Council member Hans Riemer is also staunchly aware of employer concerns, noting that council members “have always been seeking an approach that finds the right balance.” These provisions to the bill may alleviate tensions with small business owners, but could also potentially alienate the original bill’s supporters.
Ultimately, Leggett believes he needs to study the issue further before he can sign the bill to pass this new legislation. There will foreseeably be multiple perspectives on a divisive issue like minimum wage, and as such the bill will likely need to be further discussed and debated before a final decision is reached.
Article by MoCo Student staff writer Michelle Li of Richard Montgomery High School