New year raises minimum wages

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Farm groups fail to derail increases, vow to continue effort

By MITCH LIES

Capital Press

On Jan. 1, Oregon and Washington once again will increase their minimum hourly wages.

In Oregon, the wage will jump from $8.50 to $8.80.

In Washington, the wage will increase from $8.67 to $9.04.

The two states have by far the highest minimum wages in the country. And with both states annually adjusting the wage, there appears no ceiling to the ever-increasing minimum.

Except in 2010, when the wage stayed flat for a year, the minimum in both states has increased annually since voters adopted provisions calling for the annual adjustment.

Voters in Washington enacted the provision in 1998. In Oregon, voters approved it in 2002.

The annual increase could have a devastating effect on some Northwest farm operations this year as they struggle in the wake of the Great Recession, farm groups say.

"It becomes a competitive disadvantage for Oregon to have these higher wages when we are competing against other states and other nations," said Shawn Cleave, an associate director of government affairs for the Oregon Farm Bureau.

"Potato processors don't pay more for Washington-grown potatoes than Idaho-grown potatoes," said Scott Dilley, associate director of government relations with the Washington Farm Bureau. "So you have growers in Washington with a greater input cost than growers in Idaho.

"It creates a competitive disadvantage for growers in our state," Dilley said.

Idaho farmers pay their workers a minimum of $7.25 an hour, which is the federal minimum.

Only eight states have minimums of $8 or more, including California, which has an $8 minimum. Illinois, at $8.35, has the third highest minimum.

Critics argue the high minimum wage is prompting farmers to reduce their workforce, particularly when it comes to hiring unskilled workers. Farmers can't afford to pay $9 an hour to teach a worker a skill, critics say.

Critics also object to tying the annual wage increase to the Consumer Price Index, which measures inflation based on changes in prices and salaries in major U.S. cities. The index is not reflective of the financial picture in rural Oregon and Washington, they say.

These arguments and others have formed the basis of legislation brought by the Northwest Farm Bureaus and other business groups in recent years. But none of the bills have made it through their respective legislatures.

The Washington Farm Bureau, in 2011, backed passage of a bill that would allow employers to pay a training wage as a worker learned a skill. It died in committee, Dilley said.

The Washington Farm Bureau also in recent years sought passage of a bill to limit the annual wage increase if the state's unemployment rate was high. That, too, died.

In Oregon, the Farm Bureau sought to establish a tax credit for natural resource industries for the difference between the federal and state minimums -- a bill that also failed to gain traction.

In both states, the Farm Bureaus have sought, unsuccessfully, to repeal the annual adjustments altogether.

Coercing lawmakers to back legislation that takes aim at the minimum wage is difficult, Cleave said.

"I just don't see a huge interest among elected officials to try and develop a solution that works for employees and employers," Cleave said.

"We have a bipartisan group of legislators sympathetic to our argument," Cleave said. "But getting legislative traction is going to take a lot of work."

The hope, Cleave said, is lawmakers eventually will understand that the annual adjustment is unsustainable for farm operations, particularly in light of the disparity between Oregon and Washington wages and that paid in other states.

"I think we can get there," Cleave said. "But it isn't something that is going to happen over just one session."

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