STAND. COM. REP. NO. 2813

Honolulu, Hawaii

RE:    S.B. No. 2609

       S.D. 1

Honorable Donna Mercado Kim

President of the Senate

Twenty-Seventh State Legislature

Regular Session of 2014

State of Hawaii

Madam:

     Your Committee on Ways and Means, to which was referred S.B. No. 2609 entitled:

"A BILL FOR AN ACT RELATING TO MINIMUM WAGE,"

begs leave to report as follows:

     The purpose and intent of this measure is to increase the minimum wage in Hawaii to reflect increases in the cost of living and to provide workers with additional income.

Specifically, this measure:

(1)  Increases the minimum hourly wage to:

(A)  $8.20 starting January 1, 2015;

(B)  $9.15 starting January 1, 2016; and

(C)  $10.10 starting January 1, 2017;

(2)  Repeals the tip credit; and

(3)  Requires the Department of Labor and Industrial Relations to annually increase the minimum hourly wage, based upon the Honolulu region consumer price index for urban wage earners and clerical workers.

     Your Committee received written comments in support of this measure from the Department of Human Services, the Department of Labor and Industrial Relations, a Kauai County Council Member, University of Hawaii Professional Assembly, Progressive Democrats of Hawaii, IP Xpert of Honolulu, UNITE HERE Local 5, Hawaii State Commission on the Status of Women, Democratic Party of Hawaii, SAG-AFTRA, United Public Workers Hawaii, Boilermakers L-627, Hawaii Alliance for Retired Americans, Hawaii Appleseed Center for Law and Economic Justice, League of Women Voters of Hawaii, Community Alliance on Prisons, The Pacific Alliance to Stop Slavery, Dr. Martin Luther King Jr. Coalition Hawaii, National Association of Social Workers, Sailors Union of the Pacific, Partners in Care, Pride at Work Hawaii, Hawaii Catholic Conference, and seventy-eight individuals.  Written comments in opposition were received from Keoki's Paradise, Island Princess in Honolulu, Big City Diner, Hawaii Food Industry Association, TS Restaurants Hawaii, National Federation of Independent Business Hawaii, Hula Grill Maui, Duke's Beach House Maui, The Chamber of Commerce of Hawaii, Gyotaku Japanese Restaurants, and Times Supermarket.  The Executive Office of Early Learning, Chamber of Commerce for Persons with Disabilities Hawaii, Duke's Waikiki, and HealthyPacific.org submitted written comments on this measure.

Your Committee finds that the hourly minimum wage in Hawaii has not increased since 2007.  Since that time, the cost of living has risen steadily, while worker purchasing power has continued to diminish.  In Hawaii, the cost of living is higher than that of much of the rest of the nation, which compels many individuals to work two or more jobs to maintain a basic standard of living.  Your Committee believes that providing minimum wage workers with a higher hourly pay will further the economic recovery of Hawaii and help lift Hawaii's working poor out of poverty.

     Your Committee has amended this measure by:

(1)  Deleting the proposed repeal of the tip credit and changing the existing tip credit and tip credit deactivation trigger amounts to unspecified sums;

(2)  Deleting language that increases the hourly minimum wage rate, starting January 1, 2018, based upon the Honolulu region consumer price index for urban wage earners and clerical workers;

(3)  Changing the effective date to July 1, 2050, to facilitate further discussion on the measure; and

(4)  Making technical nonsubstantive amendments for the purposes of style, clarity, and consistency.

     As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2609, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 2609, S.D. 1.

Respectfully submitted on behalf of the members of the Committee on Ways and Means,

____________________________

DAVID Y. IGE, Chair