Which Chris Coleman did St. Paul elect?

St. Paul Pioneer Press ^ | 1/8/06

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In exit interviews with both Pioneer Press city hall reporter Tim Nelson and the editorial page, outgoing St. Paul Mayor Randy Kelly made the case that he's turning over an economically healthy city to incoming Mayor Chris Coleman. We'd agree. But like any politician who's just been elected, Coleman has promises to keep. The one that's keeping us up at night — and half the St. Paul business community — is the living wage.

St. Paul already has a living wage, but like many around the country it is only advisory and the city can grant exemptions. Advocates are pushing for a more stringent living wage law that would require employers to pay 110 percent of the federal poverty level, 130 percent if they don't provide health insurance. It would apply to anyone who does $100,000 worth of business with the city, but could snare mom-and-pop businesses that are tenants in buildings built with city money, depending on how the ordinance is written and interpreted.

As a City Councilman, Coleman argued strongly for exemptions to the living wage, most notably for Marshall Field's. But as a candidate, he said he supported "the kind of investments that provide the best jobs, that provide a living wage for our citizens." While that's noncommittal, we think it's fair to ask: Which Chris Coleman did St. Paul elect? We've never thought government-set prices on any goods or services — including wages — were a good idea. Numerous studies have shown that artificially high wages kill jobs, especially for low-skilled, low-wage workers, which, ironically, these ordinances are supposed to help. They also cause businesses to raise prices, ultimately passing the higher wage costs on to consumers.

Cities that have implemented modest living wage ordinances have found that they are feel-good measures at best and have little impact. Cleveland passed a living wage law in 2000 and did a three-year assessment in 2004. It found that of Cleveland's 9,500 city employees, fewer than 100 received wage increases. We suspect that if St. Paul had a more stringent living wage, it would have had little or no impact on the contractors hired for Mayor Kelly's Housing 5000 initiative, which used $100 million of city money to leverage more than $1 billion in private investment.

Albuquerque recently defeated a living-wage proposal, apparently having learned the lessons of nearby Santa Fe, which raised the minimum wage to $8.50 an hour and proposes to increase it to $9.50 this year. Santa Fe business owners have cut overtime pay and part-time workers, while vocational services for the disadvantaged and people with disabilities say they can't pay the higher wages. Challenge New Mexico is cutting programs and Heritage Healthcare is threatening to leave Santa Fe because it says it can't afford to pay its workers the proposed $9.50 an hour. Plunkett Research, a high-tech firm that would have paid 80 percent of its workers more than $40,000 a year, well above the minimum wage mandate, decided not to relocate to Santa Fe because of the law. Even the local newspaper, the Santa Fe New Mexican, which had supported the wage law but now counsels caution on the hike to $9.50, moved its production facility outside the city limits.

Closer to home, Minneapolis recently passed a living wage ordinance that requires companies operating with city money to pay workers at least $12.09 an hour. The rumble you'll hear this year are businesses heading for Anoka (and, we hope, Ramsey) County. Some businesses we've spoken to — including nonprofits — have said they doubt they can continue to work in Minneapolis under the new living wage law.

It's not like St. Paul hasn't been down this road before. In 2001 Marshall Field's proposed a 10-month, $22 million remodeling of its 39-year-old downtown St. Paul store. The St. Paul City Council gave Marshall Field's an exemption to the living wage ordinance, as it had other businesses since the law went into effect in 1997.

Then-Councilman Coleman defended the exemption, saying that the Marshall Field's remodeling was "a vote of confidence on the part of the largest retailer (in St. Paul) that will spread to other retailers." Council members Jay Benanav and Dan Bostrom were highly critical of the exemption. Bostrom went so far as to demand proof from Marshall Field's that it was unable to pay a living wage.

So the pertinent question today is this: Which Chris Coleman now sits in the mayor's office? The one who seemed to understand the consequences a strict living wage ordinance would have on every business that receives a city subsidy, or the one who hinted to Progressive Minnesota and other living-wage advocates during the campaign that, if elected, they'd have a friend in the mayor's office?

We'd like to know.