Section 2-408 of the City Code requires, for specific service contracts, that contractors pay employees the living wage rates approved by the City Commission for any given year. The current rates, approved by the City Commission on September 14, 2022, are as follows:

• $15.61 per hour without health care benefits; or
• $12.26 per hour with health care benefits of at least $3.35 per hour.

The City Code stipulates that the living wage rates may be adjusted annually for inflation by the City Commission. Typically, rate increases are considered by the City Commission during annual budget discussions, as any increase will have a budgetary impact because contract rates are adjusted to compensate for the increased wage requirement.

As is customary, on March 27, 2023, the Mayor and City Commission approved a referral to the Finance and Economic Resiliency Committee for a discussion and recommendation to the City Commission on any increases to the current living wage rates that the City Commission may want to consider for the calendar year beginning January 1, 2024. The referral was considered by the Finance and Economic Resiliency Committee on July 28, 2023.

As background information, the living wage rates for local entities that enforce a living wage requirement are listed in the table below.  

As stipulated in the City Code, living wage rate increases may not exceed the local area's corresponding Consumer Price Index ("CPI") or the cost of living (COLA) adjustment approved for unclassified staff. The CPI increase for the local area for the preceding year (January -  December 2023) was approximately 9.9 % for the overall CPI and 3.4 % for the medical services CPI. On September 28, 2022, the Mayor and Commission approved a COLA increase of three percent (3%) effective April 10, 2023. 

Despite any increase in the CPI index, the City Code stipulates that the increase to the living wage rates may not exceed the COLA increase approved for unclassified employees. Therefore, any living wage increase recommended in the current budget cycle is capped at 3%.  

To assist the Committee with determining the recommended increase, if any, to the living wage rates for the subsequent calendar year, the Administration calculated the fiscal impact of each 1% increase (up to 3%) to the living wage rates. See the table below. 

¹Based on current contract usage.

The FY 23/24 fiscal impact of adopting a 3% living wage increase is approximately $486,282.68 annually.

On July 28, 2023, after discussion, the Finance and Economic Resiliency Committee approved a recommendation to the City Commission to increase the living wage rates by three (3) percent (%) for the calendar year beginning January 1, 2024. 

If approved by the Mayor and City Commission, the living wage rates of no less than $12.63 per hour with health care benefits of at least $3.45 per hour or $16.08 per hour without health care benefits will become effective on January 1, 2024.

The Administration recommends that the Mayor and City Commission adopt the Resolution accepting the recommendation of the Finance and Economic Resiliency Committee, approved at its July 28, 2023, meeting, to increase the living wage rates to no less than $12.63 per hour with health care benefits or at least $3.45 per hour, or no less than $16.08 per hour without health care benefits, effective January 1, 2024. The Resolution also delegates authority to the City Manager, or designee, to amend any contract, as needed, to implement the increase to the living wage rates.