Developers that come to Austin wanting incentives from the City will have to pay workers a minimum wage of $11 an hour. City leaders made that decision after much debate Thursday night.
"Finally landmark legislation got passed that will protect workers on projects when those projects are receiving millions in taxpayer subsidies," said Greg Casar with Workers Defense Project, a labor advocate group.
The 1,000-room JW Marriott hotel being built downtown is sure to bring many visitors to Austin once it's finished. That's why city leaders agreed to a deal in 2011 to waive $3.8 million in fees if the developer of the hotel, White Lodging, paid construction workers a certain wage. Earlier this year, the City retracted that deal after staff determined that the developer, White Lodging, was not holding up its end of the bargain. White Lodging has since filed a law suit against the City of Austin.
This new policy is meant to prevent any future confusion over such wage rates. Thursday, in a 6-1 vote, council members passed the policy that requires developers that get incentives from the city pay all employees a living wage of a minimum of $11 an hour. Workers with more skills are eligible to earn a higher prevailing wage.
"Developers or companies were coming in and having 11th hour negotiations," said Casar. "This policy now sets the expectation up front that if a company is going to be receiving millions in taxpayer investment, that company is expected to invest in the community by making good jobs for construction workers."
But, some fear the decision could have a negative impact on Austin. Mayor Lee Leffingwell voted against the policy over concerns it could cost the city jobs. Roger Falk with the Travis County Taxpayers Union believes that giving incentives to developers isn't good for taxpayers. "Those fees would normally be funds that would come in to the city that we're having to offset with funds from homeowners. We believe that the City of Austin has no business telling private business how much they should be paying their employees and conversely they shouldn't be giving them incentives either."