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Cuomo's minimum wage hike plan draws mixed reviews

Posted by Karen DeWitt on

Governor Cuomo has spent the days leading up to this joint State of the State and budget message rolling out a number of new programs and proposals, including an anti-poverty agenda that includes raising the minimum wage, and tax cuts for small businesses.

Cuomo says as part of his budget, he’ll include a new phased in increase of the minimum wage to $10.50 an hour by the end of 2016. In New York City, the rate would rise to $11.50 an hour. The governor says New York City is arguably “the most expensive market” in the U.S.

“So it makes sense, to me, to have a two tiered minimum wage,” Cuomo said.

Advocates for raising the minimum wage say that’s not enough, and a more accurate minimum wage that people could actually live on would be closer to $15 an hour. Karen Scharff, with Citizen Action, is  also a leader of the Working Families Party. She says the governor actually promised a stronger proposal to the Party last spring when Cuomo sought, and won, endorsement for re-election.

“The governor’s proposal is really a missed opportunity to go farther,” Scharff said.

Scharff’s group also backed New York City Mayor Bill de Blasio’s request that cities be allowed to set their own minimum wage. The governor’s plan would keep those decisions under state control. He says allowing localities to set their own wage would be “chaotic.”

“You could have a race to the bottom, or you could have a race to the top,” the governor said.

Cuomo and lawmakers already agreed to a gradual increase in the minimum wage, in 2013, which would raise the minimum wage to $9.00 an hour  by the end of this year.

Greg Biryla, with the pro business group Unshackle Upstate, says it makes more sense to see how businesses cope with that increase first, before raising the minimum wage even higher.

“Let the current one take place first to see what kind of impact it’s had on growth,” said Biryla, who says tax cuts for businesses would be better for overall job creation.

Governor Cuomo is proposing a phase in of a tax cut for small businesses. It would reduce the rate of the corporate tax from 6.5% to 2.5%. But Biryla says most of the state’s small businesses pay their taxes as income tax, so could not take advantage of the change.

Cuomo now has to contend with a Republican dominated Senate, who in the past has opposed a wage increase. The governor is putting the plan directly into his budget proposal, instead of a stand alone bill, making it harder for the GOP to reject the measure if it’s part of a larger spending plan.

Scharff says Cuomo does not need to deal with any opposition in the legislature at all. She says he has the power to convene a wage board and simply increase the minimum wage that way.

Cuomo will outline the minimum wage increase and other proposals in his budget address on Wednesday.

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