March 30, 2013

Bill would ban mandated wages, benefits

A bill that would ban local governments from requiring companies to pay higher wages is set to be considered in the Kansas Senate next week.

A bill that would ban local governments from requiring companies to pay higher wages is set to be considered in the Kansas Senate next week.

The bill, HB 2069, would prevent cities, counties and other local governments from mandating that private businesses provide paid or unpaid leave, set mandated minimum pay rates or mandate any benefits – except as required by state or federal laws.

The idea is to prevent local governments from setting their own standards for wages and benefits.

As originally written, the bill sent economic development groups into a tizzy because it could have blocked them from linking financial incentives to employee pay. Economic development agencies typically provide incentives in exchange for the contractual promise of a certain number of jobs averaging a certain wage.

But, according to lawmakers, the bill was amended to specifically exempt economic development groups and address that concern.

As now written, the bill would not affect Wichita businesses, governments or economic development agencies, said Jason Watkins, the Wichita Metro Chamber of Commerce lobbyist.

The bill is actually aimed at the Unified Government of Wyandotte County/Kansas City, which requires that contractors working on publicly funded projects pay the “prevailing wage,” which tends to be higher than actual wages, according to Senate president Susan Wagle, R-Wichita.

Business groups, including the Kansas Chamber of Commerce and the Wichita Chamber, support the bill, saying the state needs to have uniform wage requirements.

In addition, many conservative legislators see the bill as removing the potential for local governments to add costs for business.

“While the issues concerning prevailing wage currently reside in Wyandotte County, this bill is good public policy for the state and even better for taxpayers who are concerned about excessive taxation,” Wagle said in a statement.

Officials for the Unified Government of Wyandotte County/Kansas City argue that requiring higher wages hasn’t hurt economic growth – instead it contributes to it by increasing the amount of money in people’s pockets.

Other local governments oppose the bill, but not because they want to mandate higher wages.

David Corliss, city manager of Lawrence, said the city requires a minimum wage of $12.21 per hour, but only for businesses that seek tax abatements.

Because that arrangement goes through the economic development process, Corliss said, it will be protected under the bill’s economic development exclusion.

Even so, Corliss said, the local government doesn’t like it when the state mandates what it can and can’t do.

“We don’t like the prohibition on our autonomy, even though the only time we’ve exercised it is in relation to economic development,” he said.

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