The House committee didn’t make many changes to the bill, but this week’s deliberations were occasionally tense as lawmakers argued for protections to prevent the bill from hurting the business community.
The bill, S.23, would raise the minimum wage to $11.50 in 2020, $12.25 in 2021, $13.10 in 2022 and $14.05 in 2023.
The measure seemed to hit a speed bump Tuesday after an analysis found a bill amendment would have forced the state to increase Medicaid spending by as much as $27.9 million over the next five years.
In an effort to minimize wage compression without creating a multimillion-dollar unfunded liability, the bill contains a compromise. It would provide a wage increase next year for Medicaid-funded workers whose pay is within a dollar of the state’s existing $10.79 minimum wage. That way, a home health worker making $11.60 per hour, for example, would still get a pay raise next year when the minimum wage rises to $11.50.
The wage compression provision only applies to 2020, the first year of increase in Medicaid wages. That cuts the unfunded liability in the proposal from $27.9 million over five years to about $875,000 in 2020, according to legislative economists.
The House committee added language to the bill that would create a study committee to examine Medicaid-funded wages before the legislature reconvenes in 2020.
The committee approved the bill by a 7-3 vote, with Rep. Diana González (P/D-Winooski) absent.
House General, Housing and Military Affairs chair Tom Stevens (D-Waterbury) said Friday that the implications of Vermont’s Medicaid pinch are far-reaching and far more serious than he realized. He said other House committees need to get involved because the issue involves more than just worker earnings. The Appropriations, Health Care and Human Services committees each have a policy stake in the state’s treatment of Medicaid.
“What I’m asking for is … a come-to-Jesus moment” about Medicaid spending in Vermont, Stevens said. “This is hopefully a bigger conversation about how to take care of this population along with the people who do it.”
In the meantime, though, the bill to bring Vermont’s minimum wage up to $15 will keep moving. The House Appropriations committee is expected to take it up next. That committee will have to decide how to fill the roughly $875,000 shortage created by the first year of increases to Medicaid workers.
If the bill passes, lawmakers would face another decision next year about further funding wage increases for Medicaid workers.
Correction, April 26, 2019: A previous version of this story contained a percentage error concerning the minimum wage increase.
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Here’s an article citing two new studies that find strong minimum wage laws to be good for overall economic health:
https://www.citylab.com/equity/2019/04/min…
Once again, it looks like good intentions beating out practicality. While a national minimum wage of $15/hour may make sense, a stand alone Vermont $15/ hour minimum wage has many problems as legislators are now just seem to be finding out. Then there is the fact that New Hampshire with its long border on the eastern side of our state has a $7.25/ hour minimum wage.
Vermont currently has one of the highest and most progressive ( minimum wage now tied to cost of living) in the nation. Would be best to let this one be.
P.S. While retired, I have been employed for a number of years in the summer at a state historic site where the wage is far less than $15/hour. Should this legislation pass there will be a need for more state funding or the viability of some of these services not to mention private businesses and their own survival or how many people they can employ will be put in question.
The minimum wage is 10.50 an hour now so probably it will be 15.00 by 2024! Why take so long to raise the wages unless the state is waiting for the Fed wage to catch up! That way the state won’t be to blame for anything.
Actually as of January 1 the Vermont minimum wage went up to $10.78 / hour due to it now being tied to cost of living. It will be increasing more every year from now on and will likely be over $11/ hour next January.
It would be interesting to know if undocumented farm workers in Vermont are receiving the Vermont minimum wage. If so, how is this monitored? My guess is they are not and this might be more of an injustice to be focusing attention on.
No surprise here, $28 million budget deficit? Let’s vote it in and kick it down the road, instead of figuring out where to get the money now before voting for it. When will the people in VT wake up and realize the legislators are not doing the public any good?
A recent article was published that the state of Vermont is the 47th worse state to retire in. So the $15 minimum wage won’t help those on a fixed retired income. The big reason the state is raising the wages is they get a percentage of those wages. Since wages are the biggest expense for any business you will see the cost of goods go up an equal percentage. I think it would be great if my paycheck went up the same percentage as the minimum wage.
Once again the socialist moonbats in Montpelier are pursuing a utopian living wage agenda without considering the economic consequences of their actions. A $15/Hr minimum wage will force smaller businesses to shut down and larger companies to eliminate positions through the use of automation and robotics. We are seeing it already with automated ordering kiosks in McDonald and self service checkouts in large retailers. The long term goal is to process your payment and tab your purchases by reading the Rfid chip already part of merchandise tagging. Hopefully by 2024 we will already have free health care and guaranteed income in place.
If we can just figure out that global warming thing life will be good.
You know who really wins? The taxman.