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'Far-reaching change'

Gov. Kate Brown is proposing a two-tiered minimum wage for the state, and Southern Oregon legislators, employees, activists and business owners are coming to grips with what that might look like.

The proposal, which hadn't yet been dropped into the legislative hopper as of Thursday, would begin migrating the nation's second-highest minimum wage of $9.25 to $15.52 within the urban growth boundaries of the Portland area, while the rest of the state would move over time to a $13.50 minimum wage.

If approved, the first increases would take effect next January. Outside the Portland area, the hourly wage would rise to $10.25. Inside the Portland area, the wage would go up to $11.79. After 2022, increases would be indexed to inflation.

"I just found out about it Wednesday night," said state Sen. Alan Bates, D-Medford. "At present, until I see what it looks like, I'm very cautious and haven't committed my vote for it yet."

Bates sees the benefits of the Legislature hammering out a bill during the 2016 session that begins Feb. 1, but he also sees the potential for unintended consequences.

"This is a far-reaching change," said Bates, whose party controls both legislative chambers. "What does it mean to people in Burns, Pendleton and Southern Oregon? We need to get feedback from business owners and propose changes that would help them ease into this thing better."

Jason Houk, an organizer with Southern Oregon Jobs with Justice, thinks separate wage standards will lessen the effectiveness of people who support a minimum-wage hike.

"Personally, I don't think it's very helpful," Houk said. "The schism between $13.50 and $15 campaigns is challenging. It's a problem for organizers, and it's hard to know where to put our energy."

One thing for certain, Houk said, is the need to create jobs and increase the standard of living.

"We need to put money into the hands of the people who will spend it," he said.

Medford resident Rhonda Thompson, who works at Holiday Inn Express in Ashland, said she is curious about what kind of bump would come for workers whose earnings have risen without the help of a minimum-wage boost.

"People working 40 hours a week should be able to afford things," she said.

Thompson started at $11 an hour last May and has been rewarded by her employer with a series of raises that have moved her toward self-sufficiency. She didn't want to disclose her hourly wage, but she no longer qualifies for food stamps, she said.

"I've always wanted to be a real grown-up," said Thompson, whose son graduated from high school last spring. "My mom was on food stamps and welfare her whole life. My mom didn't graduate from high school and neither did I. But I've got two associates degrees from Rogue Community College, and I'm paying my way through SOU, taking two classes a term."

Thompson said her employer didn't cut her hours when the state's new sick-leave law went into effect Jan. 1, but she understands the cost of many things will go up with a higher minimum wage.

Medford resident Cecie Elliot thinks such a move would help offset years where many workers have fallen behind.

"For the Rogue Valley, it would be amazing," Elliott said. "Being able to work a 40-hour week, provide the essentials, be there for your family and even save a little would be a blessing. And I think when you invest in your workers, it comes back to you."

In Elliott's estimation, minimum wages were created to protect workers from exploitation and to set a standard of living. The cost of living has steadily risen during the past 10 to 20 years, without comparable wage improvement.

"It seems silly to say that prices will go up solely because of the minimum wage," she said.

State Rep. Sal Esquivel, R-Medford, has lots of questions about Brown's proposal, but was told members of the Business and Labor Committee would not be allowed to ask questions during a Thursday night hearing.

Esquivel said a jump in the minimum wage would hurt seniors on fixed incomes and lock out youngsters looking for their first job.

"Employers won't be able to hire as generously," he said.

Esquivel is concerned about the impact on full-time employees who lose their link to the Oregon Health Plan when they earn $12.25 an hour.

"Then they'd have to purchase their own insurance, and that's a step backwards," he said. "There's just a lot to think about."

Former Medford City Councilor John Michaels said a higher minimum wage is just the first step in solving income inequity.

"We need to help people with job training and education; otherwise we're just creating an artificial bubble within the area, and people will think they don't need those skills," Michaels said. "When they move on, they're ill-trained for other areas."

The challenge for Sunrise Cafe owner Ed Chun wouldn't simply end with the low-end hourly wages.

"It increases the overall costs of operations," the former Medford City Council member said. "Our cooks and seasoned staff already make more than $13.50. But if my dishwasher, who is just starting out at $10 an hour, began making $13.50, then the others are going to want $16.50. In a sense you have to give false raises to everybody else to make it even across the board. But it's not just the wages, everything has to be factored in. Workers comp is based on wages, payroll taxes go up. It's not just $13.50."

Reach reporter Greg Stiles at 541-776-4463 or business@mailtribune.com. Follow him on Twitter at www.twitter.com/GregMTBusiness and on Facebook at www.facebook.com/greg.stiles.31.

Jason Houk of Ashland, an organizer with Southern Oregon Jobs with Justice, thinks Brown's two-tiered approach will be a challenge for organizers campaigning to raise the minimum wage. Mail Tribune / Jamie Lusch
Workers and labor groups have been calling for a minimum-wage hike for some time. This wage protest was held outside Wendy's in Ashland in December 2013. Mail Tribune file photo