Hospitality owners favor lower state minimum wage hike

ST. PAUL, Minn. - Hospitality Industry owners swarmed over the Minnesota State Capitol on Monday lobbying for their version of a minimum wage hike.

Bills in the House and Senate would raise the state minimum as high as $9.50 an hour.

"Hospitality Minnesota" is a coalition of restaurant, lodging, resort and campground owners. About 270 of its members rallied at the Minnesota History Center, then walked or shuttled to the Capitol. They scheduled more than 200 visits to legislator's offices in the Capitol and the State Office Building next door.

"We are not opposed to an increase in the minimum wage," said Dan McElroy, former State Commissioner of Employment and Economic Development, now Executive Director of Hospitality Minnesota. "We think it needs to be done thoughtfully and taking into consideration the environment in our region."

McElroy pointed out that a Department of Labor study found 80,000 Minnesotans receiving minimum wage pay. In Minnesota, 38,000 people work in the food and beverage industry.

Hospitality Minnesota members prefer a "two-tier" minimum wage structure for servers who are paid tips. One tier would be whatever the new minimum wage is for servers who are paid less than $12 an hour including tips. Servers making more than $12 an hour would be paid the current, lower minimum wage.

"We just need to raise the minimum wage in such a way that it does not take thousands of jobs out of the restaurant industry," said David Burley, co-owner of the Highland Grill in St. Paul.

Co-owner Stephanie Shimp added, "We support raising the minimum wage in a thoughtful manner that protects good paying jobs for our servers who are currently on average earning $22 an hour in the metro and $18 outstate."

Owner Doug Sams of the D. Brian Deli in Minneapolis said he worried about the impact on society's newest workers.

"I have 100 employees now and I have given literally hundreds and hundreds of young adults their first job. Most of my openings are entry level jobs. The unintended consequence of an excessive life to the minimum wage is that it will be heads of households who will come in for my entry level jobs."

Sams said inexperienced, younger applicants would be "frozen out" of entry level jobs by the more competent, older workers.

"One of the toughest things that I have in my mind is how am I going to tell these high school kids who work for me, who help rake lawns, mow lawns, collect garbage, do a lot of the just routine things around the resort, how am I going to tell them that I cannot hire them this year?" wondered Paul Bugbee, owner of Bug-Bee Hive Resort in Paynesville.

"We are not saying that the sky is falling," said McElroy. "We are saying that there will be dramatic changes (by raising to $9.50) that are avoidable. Something lower than $9.50 makes sense. Recognize tips. Do not index for inflation."

Two minimum wage hike bills are presently in the House/Senate Conference Committee. Legislators are trying to find agreement to reconcile differences between the House and Senate versions.

President Barack Obama has said he would like the federal minimum wage to rise to $10.10 an hour. Gov. Mark Dayton has said he would sign a bill to raise Minnesota's minimum to $9.50.


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