Primary Source: Would a $15 Minimum Wage in Vt. Hurt the Upper Valley?

  • Valley News political columnist and news editor John Gregg in West Lebanon, N.H., on September 20, 2016. (Valley News - Geoff Hansen) Copyright Valley News. May not be reprinted or used online without permission. Send requests to permission@vnews.com.

Thursday, January 25, 2018

The Vermont Senate Economic Development Committee tonight will hold a public hearing at the Statehouse on a bill to raise the state’s minimum wage to $15 an hour by 2022.

It’s co-sponsored by Upper Valley Sens. Alison Clarkson, D-Woodstock, Dick McCormack, D-Bethel, and Mark MacDonald, D-Williamstown, though Republican Gov. Phil Scott, and some others, have questioned whether it would hurt employers along the Connecticut River Valley.

The current minimum wage in Vermont is $10.50 an hour and it’s now indexed to increase by the inflation rate starting in 2019. Meanwhile, New Hampshire’s minimum wage is tied to the federal level — a paltry $7.25 an hour — and recent efforts by Democrats to raise it have been rejected by Republicans in Concord.

The Vermont bill is a top priority of Senate President Pro Tempore Tim Ashe, the Burlington Progressive who also was elected as a Democrat, though he said in a phone interview on Wednesday that the legislation may be pared back to match the proposed minimum wage for upstate New York, which is slated to reach $12.50 an hour by 2020. Under a multi-tiered system in the Empire State, the minimum wage for companies in New York City with at least 11 employees will be $15 an hour by the end of this year, and will reach that level for all Big Apple employers by the end of 2019.

An economic analysis last fall by Thomas Kavet, Vermont’s state economist, found that a $12.50 minimum wage in 2021 would cost Vermont about 900 jobs but would boost income for low-wage workers by some $55 million, helping to reduce their reliance on state benefits. Going up to $15 an hour in 2022, Kavet estimated, would cost Vermont some 2,830 jobs but boost income for low-wage workers by $240 million.

“I know the pressures along the Connecticut River are real,” Ashe said on Wednesday, but “we did not hear a lot of businesses say they are shutting down and moving across the Connecticut River” when Vermont implemented its recent increase to $10.50 an hour.

“I’m sensitive to the issue, but I am more confident that increasing the economic well-being of tens of thousands of people will pay huge dividends for the state, and give more disposable income to people who will in turn spend it at local general stores and so on,” Ashe said. “In total, I think it will be a win for our economy.”

Not everyone agrees, including Strafford Selectman John Freitag, a former town Democratic chairman who ran for the Vermont House as an independent in 2014. Freitag called in to challenge Ashe’s support for the minimum wage boost when the lawmaker was on Vermont Public Radio last week. In an interview this week, Freitag also noted that small businesses in the Valley already struggle to compete against New Hampshire, given its lack of a sales tax.

“There is a tipping point for businesses to survive or simply for owners to say this is just too much,” Freitag said. “I am concerned that although the intentions are good, this effort may have more negative consequences, especially on our side of the state, than some expect.”

In New Hampshire, state Rep. Andy White, D-Lebanon, said about 8,000 people earn the minimum wage, though thousands more individuals working in part for tips also would be impacted by an increase in the minimum wage in the Granite State. White also acknowledged that many employers in the Upper Valley already “have had to increase the wages they pay simply because of competition.”

Fast-food restaurants in West Lebanon, for instance, have been highlighting jobs paying $10 or $11 an hour.

The hearing runs from 6-8 p.m tonight in Montpelier.

Kuster on the Budget

U.S. Rep. Annie Kuster, D-N.H., toured Dartmouth-Hitchcock Medical Center’s “Moms in Recovery” program on Wednesday as part of her work with a Congressional Bipartisan Heroin Task Force, which she helped found and co-chairs. The DHMC program has treated 122 women with substance misuse problems.

One of the big issues, Kuster said, is helping the women overcome the stigma associated with being a drug user while pregnant. “There’s stigma and judgment about anyone who is suffering from substance misuse, but there’s particular judgment focused on moms with babies because our society wants the baby to be healthy, and what they love about this program is it’s a judgment-free zone. They can come in and be themselves and learn from other people who are going through the same thing.”

Like U.S. Sens. Maggie Hassan and Jeanne Shaheen, D-N.H., Kuster voted earlier this week to end the federal government shutdown in hopes a deal over the Deferred Action for Childhood Arrivals can be reached and that funding can be obtained for community health centers and the opioid crisis.

“I want these negotiations to happen, but I didn’t want our government to be closed for an extended period of time while the negotiations are happening,” Kuster said.

U.S. Sens. Patrick Leahy, D-Vt., and Bernie Sanders, I-Vt., and U.S. Rep. Peter Welch, D-Vt., voted against ending the shutdown.

John Gregg can be reached at jgregg@vnews.com.