After nearly three hours of heated debate, the House passed a bill that would raise Kentucky’s minimum wage from $7.25 to $10.10 over a three-year period.
Supporters of House Bill 1, sponsored by House Speaker Greg Stumbo, said the measure would provide a living wage to thousands of Kentuckians working for minimal pay, but critics countered that raising the minimum wage would prove detrimental to the state’s business climate.
The final vote — 54-44, with Reps. Susan Westrom, D-Lexington, and Jim Gooch, D-Providence not voting — came largely along party lines, with some defectors from both sides. Reps. Dwight Butler, R-Harned, C.B. Embry, R-Morgantown, Jim Stewart, R-Flat Lick, and Jill York, R-Grayson, sided with Democrats favoring HB 1 while Reps. Robert Damron, D-Nicholasville, and Fitz Steele, D-Hazard, voted with Republicans against the bill.
Stumbo, D-Prestonsburg, said after the vote he knew some Democrats in his caucus had issues with raising the minimum wage. With an overwhelming majority passing the last minimum wage hike, from $5.85 to $7.25 in 2007, Stumbo said he was confident members of the GOP would tilt the vote in HB 1’s favor.
“We took the vote to the floor on the premise that the members, after hearing a very thorough and heated floor debate, would do the right thing for working women and working families of Kentucky,” he said. “… It’s a shame that they politicized the issue, those that stood in opposition, but that’s their prerogative.”
In his floor speech, Stumbo said passing HB 1 would send a message to low-wage Kentuckians that the American dream is still attainable.
Two-thirds of those working minimum-wage jobs in Kentucky are women, Stumbo said. HB 1 includes a provision guaranteeing pay equity based on gender and would raise the minimum wage 95 cents per year until reaching $10.10 by July 1, 2016. The legislation, as amended Thursday, would not affect businesses with annual gross sales of less than $500,000.
“Somebody living somewhere in Kentucky is going to be able to afford something for that child in their home,” he said. “Somebody’s going to be able to pay the light or heat bill that they couldn’t otherwise do.
“… Somebody’s life will be better because of what you did here today and the course that you set for this state.”
House Minority Leader Jeff Hoover, R-Jamestown, said the proposal would cost jobs, citing a study that showed for every 10 percent increase in the minimum wage, unemployment rates rise 1 percent.
A Legislative Research Commission analysis estimates 13,800 workers would lose their jobs if HB 1 is implemented, Hoover said, adding that Kentucky’s 8.6 percent unemployment rate ranks 44th in the country.
Hoover also cited LRC figures showing local governments would pay $5 million more in wages annually and school districts $4.8 million more in payroll per year once HB 1 is fully implemented.
Rep. Julie Raque Adams, R-Louisville, said local governments may be forced to decide between raising taxes or laying off staff to keep pace with rising payrolls, should HB 1 become law.
“These are taxpayer-funded entities,” she said. “… We need to understand that we’re going to have to look at all of our county clerks, all of our county judge-executives, all of our magistrates, and we’re going to say, ‘We are handing you an unfunded mandate.’”
A minimum wage hike could also cause a “stair-step” effect for other workers’ pay, further increasing personnel costs on businesses, said Rep. Stan Lee, R-Lexington.
Stumbo and other Democrats dismissed Republicans’ concerns. He cited a Center for Economic and Policy Research study that showed modest increases in the minimum wage had little or no effect on joblessness.
Rep. Jim Wayne, D-Louisville, said experts with the American Economic Association have come to the same conclusion.
“If your business plan is so weak that a 95-cents-an-hour increase in the wages of your employee will bankrupt you, my God, go back to business school,” he said. “There’s something wrong with your business plan and your business acumen.”