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Living Wage Ordinances and Community Benefits Agreements
Southern Echo: Building Power in Marginalized Communities

Living Wage Ordinances and Community Benefits Agreements

Living wage campaigns seek to increase hourly wages for low-skill workers, so that they can maintain a decent standard of living. Since 1994, FACT has funded more than a dozen such campaigns in cities and municipalities around the country. The Center on Policy Initiatives (CPI) launched the San Diego Living Wage campaign along with a number of other local organizations such as ACORN, the San Diego Organizing Project, and the childcare, healthcare, and janitorial workers unions. CPI produced several reports documenting growing economic inequality in San Diego, which bolstered organizing and advocacy and helped to rebut data from opponents of the measure.

The council ultimately passed the measure by a narrow 5 – 4 vote. The ordinance raised the minimum wage for employees of city-contracted companies to $10 per hour for employees who also receive medical benefits (or $12 per hour for employees who do not), and indexes future increases to inflation. The new wages phase in over time and apply only to companies in certain industries — such as janitorial services, landscaping, and security — with city contracts exceeding $25,000. Living Wage friends and foes alike claim that this victory signals a watershed moment in San Diego City politics. Previously considered a conservative stronghold, the passage of the ordinance marks an apparent power shift in city politics.

Living wage campaigns began in Baltimore in 1994 when food bank operators noticed that the people they were serving were full-time employees of city contractors. Today, over 125 jurisdictions around the country have addressed the growing economic disparity in the U.S. by enacting laws to increase wages for full-time, low-income workers to a rate closer to the cost of living. Another motivation behind living-wage campaigns is greater accountability for how tax dollars are spent. Most cities offer huge tax breaks to attract new businesses, which usually include low-wage employers that keep families in poverty. Without sufficient income, they are forced to depend on tax-funded public services for their basic needs.

The most definitive study on living wages, published in 2005 by UCLA and the Los Angeles Alliance for a New Economy (LAANE) and entitled “Examining the Evidence,” found that L.A.’s living-wage ordinance had increased pay for an estimated 10,000 low-income workers with a high school education or less, while resulting in minimal job reductions. Eighty-one percent of L.A. firms affected by the living wage did not eliminate jobs. Most recovered some of the wage increases — which averaged 16 percent — through reductions in employee turnover and absenteeism, and many covered the remaining costs by reducing fringe benefits and overtime, hiring more highly trained workers, reducing their profits, and passing on the costs to the city or to the public.

Living Wage campaigns’ natural allies in reducing poverty are Community Benefits Agreements (CBAs). CBAs ensure that economic development projects that receive taxpayer subsidies create new jobs that pay living wages and benefit the community around the project. The first CBAs were negotiated in California in the late 1990s. In 2004, LAANE spearheaded the largest and most comprehensive CBA ever negotiated, a $500 million agreement between the city of Los Angeles, the airport authority, and a coalition of community organizations, unions, environmentalists, and residents as part of the $9 billion expansion of L.A. Airport. The CBA covered a wide range of environmental, labor, health, noise and accountability issues.

Key elements of the agreement include soundproofing all schools affected by airport noise and increasing funding for soundproofing homes; reducing pollution from diesel vehicles and idling airplanes by more than 90 percent; providing training for airport and aviation-related jobs and giving priority to local, low-income, and special needs residents in hiring for them; more opportunities for local, minority-, and women-owned businesses in the modernization; and provisions for community monitoring of LAX to ensure the agreement's enforcement, and LAX’s accountability to the community.

“We have demonstrated that when communities have a place at the table, economic development works better for everyone,” said Rev. William Smart, senior community organizer with LAANE.

The Wall Street Journal called the agreement “the latest sign of the growing coordination among social groups.” The hugely successful and growing living wage and CBA movements are largely the work of various community-based organizations and coalitions around the country, and are an example of how a coalition of educated leaders, savvy advocacy and research, and empowered communities can make a big impact.

Southern Echo: Building Power in Marginalized Communities

Southern Echo is a grassroots education and leadership organization based in Jackson, Mississippi. Founded in 1989, it provides training and technical and legal assistance to communities of color in Mississippi and 11 states across the southern United States. FACT has funded Southern Echo since 1996 and seen it grow from a small, community-based group into a political powerbroker capable of influencing the dynamics of the state legislature.

Echo first made its mark in redistricting, the process by which states use census data to create voting districts. The party in power draws the boundaries of each district, usually in a way that helps it win elections, and limits the electoral prospects of black candidates. In the early 1990s, with the technical assistance of long-time FACT grantee, the Progressive Technology Project (PTP), Southern Echo and other grassroots organizations led an 18-month campaign to force the state legislature to create majority black districts that could elect candidates to represent their needs and interests. By 1993, the legislature’s Black Caucus held the balance of power on important bills such as appropriations, and the grassroots redistricting coalition was strong enough to defeat efforts by the governor and legislative leaders to dismantle the new districts.

The legislature had similarly excluded blacks from educational opportunities by cutting funds for the predominantly black public school system, which cannot compete with all-white private funded schools. In 1997, the Black Caucus and community groups prodded the legislature to pass the first major public education appropriation in a generation to fund capital improvements, teacher salaries, and technology in poorer school districts. When the governor vetoed the bill and the legislature agreed to cut the appropriation in half, a black committee chair led the fight to override the veto by four votes.

In 2000, state officials sought input from Southern Echo’s coalition of grassroots community educational organizations on how to hold local districts accountable for low performance on standardized tests. The state eventually implemented the working group’s proposals to allow parents and community leaders to participate in evaluating local schools and developing and implementing improvement plans. When the governor again proposed cutting education funding in 2004, Southern Echo developed materials and worked with an alliance of parents, teachers, students, and others to gather signatures to resist the cuts, and most were ultimately rescinded.

On the strength of this new educational alliance, Southern Echo jointly sponsored a four-day conference in November 2004 called “Dismantling the Achievement Gap.” More than 300 stakeholders shared their experiences and discussed the problems and possible solutions in the state education system. Based on analysis and strategies that emerged during the conference, activists from eight southern states are developing a regional approach to educational reform.