 summer months you had to pay the full minimum wage during the school year you could pay a student during vacation periods or during the school year like looking at nights you could pay them the federal wage we didn't change that we just but we made it clear that it was only applicable to secondary school students not the college students it's not summer vacation during summer vacation the department has interpreted to mean that you have to pay full minimum wage which would be 10 70 right now page 3 at the bottom page 2 of ours though that would cause that would cause problems I'm sorry I have a different version but now I have so the section 3 on child care you recall last year the summer study we did on this which is a very extensive summer study was called the minimum wage and benefit cliffs study and there was concern that if you raised low-income workers minimum wage up that they would lose so much in benefits that they would go backwards and what we were told by the Joint Fiscal Office and Deb Brighton that the real problem area in loss of benefits was child care benefits so last year we said that people would stay would be held harmless from an increase in the minimum wage on their child care benefits we had the wisdom in our committee to put the words at the beginning to the extent funds are appropriated because we knew you would put it in anyway even if we didn't so we got in front of you to say that same thing so the idea here was we knew you were going to make the decision on this we wanted to let you know that this was a concern and we did the same language again the difference here is the language is a little looser it has been approved by the the Department of Children and Families Deb Brighton our legislative council to accomplish the same goal a statement of intent that we would like the Appropriations Committee with the added monies in terms of income and save benefits that an increase in the minimum wage will get to the state budget to make sure these people don't go backwards on their child care benefits and so again it's to the appropriate monies for the same the minimum wage adjustment for inflation report we continue to maintain as we did in last year's bill that was vetoed COLA based upon the CPI but we also want to report back prior to the end of 2024 I think it's January 15 2023 into 23 an analysis of other possibilities that for inflation factors or whether there should be an inflation factor that was in last year's bill we continue to struggle with two issues in our committee and they were also things we dealt with last time and we came to the same conclusion was typically employees is there are very strong advocates on both sides of this issue a lot of restaurant owners want to get rid of the five dollars and something they pay altogether or freeze it and not have it float with the increase in the minimum wage right now there's a formula that says a tip minimum wage employee shall get 50% of what our minimum wage is so 50% so if we're at 1078 now they're getting 539 now a lot of tips it's mandatory that if they don't get up to the 1078 that the employer is supposed to make up the difference we don't know there's been apparently one case in the Department of Labor where somebody has had that enforced against them so we don't know how often people complain in fact advocates who would like to see the tip minimum wage disappear and go to 1078 say that people are going to complain and they're also indicating that it leads to increased sexual harassment because people have to be waitresses have to be more accommodating to advances in order to get their tips because they're so dependent upon the tips it's reported by others but not by you correct not by me right now if you're yes some advocates who want to get rid of the who want the tip minimum wage to be the same as the regular minimum wage make that case we decided that it was worthy of a study and I think it is there are states go in a lot of different directions some have one uniform wage some have just used the federal minimum wage 2013 cents that's another approach that people have started to use and that has met with a lot of it when you see I know one restaurants doing that it's met with a lot of resistance from the wait staff and some people like that some people don't it's it's not a straightforward as I think it is I think we could benefit from knowing what this you know the best practices are out there in other states and what our options are we put only if they're legislators I think it's a choice this right now I'm sorry if you're not a state employee right exactly the pain and if you're a legislator you get paid we would have no obviously that's your choice and I think that makes sense we we have one member appointed by the speaker one member appointed by the committee committees actually it's two members appointed by both of those people one of which has to be an expert or represent business and one has to be representing workers and we also threw in there because some members of our committee at a very late stage wanted to get rid of the school exemption that I talked about before and they wanted to say school work students should get paid the full minimum wage year-round and we just said we need to study that because we didn't take much testimony on that same thing with regard to where you have under the definition of secondary school students under 18 years working and all or any part of the school year of regular application periods how does the labor person or maybe this is someplace else in here how do they know that it doesn't seem to me that's a regular location I think that's an excellent question and I think most people are unaware of this exemption I think for instance and I didn't even know this exemption existed but that's the position of the department so I mean how does the lay person know it from I would you just let the language alone but I think it's a good point I welcome clarification of that and if you want we could put in there excluding summer vacations and make it just clear straightforward clear I think that's the intent of our language I think center raise a good point and we would be if you want to do that we would be happy to do it too I think my committee would be that's what was our intent I will take it back to my committee and maybe we'll have some testimony I'm just saying unless we want to take testimony on it Alan or get a Department of Labor explain how they inform employers of their wage responsibilities they I'm sure they have lots of guidance that they send out but I'm not sure so the timetable that you said was last year's bill on on 2024 the end date so you just simply you're trying to keep the same mandate as the last yes okay you mentioned earlier that the federal minimum wage for tip workers was $2 and something some yes or is that and the federal minimum of seven and a quarter seven twenty five other questions thanks I think I understand the language starting at the bottom of page one if the minimum wage reestablished by the US government is greater I think I understand how comfortable how sure are you that this is protecting the so-called cliff the idea that that you get a raise and there will definitely be some benefits that will go down food stamps will go down as a result of getting an increase in the minimum wage if you're working at the minimum wage but your child care benefits won't go down so it is true that for every dollar we raise the minimum wage minimum wage workers won't receive a total dollar increase in there for each $3 more you earn the benefits reduced a dollar so there's gain but it's it's related and we're not we are that's a federal program yeah and I reference the wrong which I mentioned section 3 that's a silly can't change that well so that no it'll get these people are encouraging to get off from that it's not a cliff it's a small copy yeah actually food stamps are more of a slope than any program because it's for every $3 more you earn the benefit is reduced once you're gaining two bucks a lot of the programs you get up to X percent of the federal poverty level and you're totally off there's no slope it's just a cliff so we can't change food stamp eligibility it's a federally funded benefit but we are on health care I mean can we call this other than something other than wages so that Bobby that I don't know they you know in other words if you get above 300% of federal poverty level we're going to create a slope this is something that has been studied and it can be done it's just the cost it takes to do it but probably the most closely aligned to creating a slope than anything the relationship between tips how's the relationship between tips how does the bill affect the situation when you go out to dinner and there's a quote service charge which the layperson says oh what a nice employer is making sure the waitress gets a tip but in fact there are places where that service charge compensates management for the waitresses that's your intent on page two I bet and section 2 this was a service charge shall not be considered a tip that's the language of concern just want to make sure you you think this does not have loopholes this apparently this is existing practice and it protects it's to protect the weight waiters I think this last year was raised by you and that's why the language in there yeah I'm not sure this is the same as last year yes thank you shall we keep going I don't know how far we got to the study and what the committee is going to do part of the labor will call it and then we have a conversation on page five that's it the only thing definitely on the last page about number two we we give up redeem compensation and reimbursement for members of the committee who are not employees of this but if they should I guess that was anticipating them becoming from private business or from the that sector as opposed because so many of our study committees are composed of people who get paid as part of their normal duty and we don't so we have something we put in or otherwise not compensated by the employer so that it's not a double payment and Damien you know what I'm talking about as a matter of protocol maybe it's good it may not mean that has any relevance here but we don't know who the appointments might be so just to keep it consistent with our normal language around compensation okay that's okay with you yes all right so the major piece that we're getting into and this is what Bobby was talking about that's the the slope or the impact on benefits in this case we're just dealing with the child care because that was based on the analysis seemed to be where people would be the most adversely impacted by this wage increase so other questions of the senator if we could figure out some way to offset that you know if an employer has to raise their wages by a couple bucks and yet the recipient is gonna lose a dollar from some federal program that who's really one nobody because the recipient hasn't really won because they're only getting part of the $1 of the two that the employers raise they're losing money maybe on their health care or their childcare so I think we should fix the child care thing and rent subsidy or whatever so that at least everybody wins on this the employer they've got to way to raise this extra money why you think it away from the recipient you know because we cut these other programs and I just worried that it's a road to nowhere because I've heard people here talk about getting all these benefit programs in alignment but I'm guessing the reason it hasn't happened yet is because if you do one throws off the other and then the other gets twisted and so but I actually but because it's so complicated I've heard people say don't allow people to earn more when they show up for work because it'll take away a benefit from them well like a government program benefit and I always think well that means they're valid valuing a government dollar more than a dollar earned which would I think that's problematic positions so I agree with you that it's screwed up but I worry other reason it hasn't happened before us because they don't figured out how to make all the dials and we have study on slopes cliffs etc well it comes if the state does it it's the price tag is huge because you can get it into student assistance where people would earn more and it would reduce the amount of financial aid for college to pay I mean the public housing is another example so it a fuel assistance and the list goes on and on so it can be costly my other question though is from a policy basis people are arguing that wages should be raised to a livable level so that people are not so dependent on these financial benefits I mean that's another argument I've heard for having the wages keep pays more than they have was that I mean if you were to describe the policy basis behind this bill how would you describe it income inequality wage stagnation wage gaps people's taxpayers paying to keep get people to a livable wage or basic needs budget I had a handout but it's probably more than you want of charts showing where we are and stuff but that's the policy behind it and it used to be to like somewhere like in the 1970s where productivity in this country wage earners were keeping getting a fair share of that productivity now there's this big gap where productivity is going way up and the low-income workers are not sharing in the gains and this is one tool I understand what happened to the idea that we would base our inflationary but we we several years ago decided we're not going to talk about minimum wage and we're going to target the minimum wage based upon the rate of inflation many progressive and other causes you know went after the 15 this bill gets to $15 somewhat ahead of where we would have gotten and we just targeted the inflation why didn't we go back and increase you know the inflation or rewrite the inflation factor to make sure if they kept up to some extent more with the cost of living in Vermont which I hope is the problem we're trying to solve and not just trying to say well New York 15 Seattle 15 and this one's 15 so everybody that's got a democratic legislature going 15 right because the argument back then was you vote for this now and you'll never have to vote again on a minimum wage bill so what was this about I believe it was about 10 years ago just before you arrived okay just before the progressive coalition I don't remember being here when there was these well I think you can do this one I know that there was a promise that was the promise made other than a crazy minimum wage that Jerry Morrissey proposed that would have been $50 an hour or something which was a joke I never voted against the minimum wage but not as it was designed to get out a certain senator who was claiming who had a business in Mexico where he wasn't charging Jerry pointed out to him that while he was advocating for a minimum wage in Vermont is Mexican workers were being taken advantage of and so he proposed something like $30 an hour or something it was a pretty gigantic boost that she would really have been sorry if it ever passed other than that I don't think I voted against the minimum wage but we had continually were voting to increase the minimum wage yes so where is the problem what happened well I think it's what I just described is that the cost of living and basic needs budget is just going way up here but why didn't we say okay rather than going after $15 the might have gone to 16 or 17 if we did it that way but seems like this is kind of taking us backwards where next year the proposal and I would be 17 or two years it's a different the next biennium people probably go in on a $17 that the 15 didn't get us there close it's a different way of maybe getting to the same place I I don't know I remember this we had in our law the inflation factor being inflation or five five percent whichever is less that was the inflation factor and somebody from the business community said why don't we just do inflation or five percent whichever is greater because inflation was so low and that was pretty much the the numbers that we came up with it's just more traditional way of doing the minimum wage I've been doing minimum wages first when I do it was three dollars and ten cents yeah so you've been so I think we're setting ourselves up to be continually voting on increase minimum wage which we wanted and I think it makes to avoid continually voting on a minimum wage increase by not going after that inflation factor and saying well this hasn't came up so finding a formula that takes into account the minimum the basic needs I'm making sure that the minimum wage stand was that part of the reason we have this study yeah but I say I don't I just the way it's going to work I won't be here when you have the 14th vote on minimum wage in the next five years well but I would I would guarantee you that this is going to be everybody and you'll have a minimum wage vote if you don't deal with something like this I think it was it it may not have been the right factor it may may have been too slow whatever and I realize it's hard to step back now with three weeks to trust but I would hope that we could at least avoid these continuing debates I would say one thing just to put it a little bit in concrete perspective that last year I think it's gotten worse that to reach $15 on your existing law you'd have to wait till 2034 I'm not Michael I'm not even arguing against the $15 I'm just saying I'm hoping that you will find a way to make it 17 to make it 18 so I have a certain Westman and then Alice you know I hear all the stuff about me the pressure this creates on the budget did you take any testimony I've got childcare on providers that this is going to on the side of the wages that they have done I had one child care provider that tells me that per kid it's $40 of the extra they're going to have to make up my mental health agency is going to for us to maintain that is going to increase my home health agency we took testimony from all the same people we took both in the summer study committee in last year's bill and we did an analysis that showed that even in the school districts that every step of the way there was very little immediate impact and and most of the areas you talked about there was likely to be no impact into 2024 so we did all that and we have an analysis both from the joint fiscal office last year and also in the summer study in a lot of depth asked to that and it's surprisingly less than you would think I'm not saying it's non-existent but it's pretty small that isn't what I heard from you are addressing it no you are you are pressing it for the subsidy in the fee scale kids two pieces one of which is the cost of labor that's what number two I think as I read it was attempting to do to to offset the estimated increase of the cost of child care resulting from the increase in minimum wage required in this act so I think that is the only provider that is specifically addressed here in terms impact other questions and then maybe we can go into so yes so with regard to when the report happens 2023 and say so get the report say the legislature is in a very conservative event that year this is okay we're just going to ignore that report so then is it true then that the that the wage employee will then be at $15 now without any chance of an increase if the legislature did nothing the existing CPI would kick it would that's spelled out someplace it's an existing law right now that that will kick in it right right right that's the default yeah okay that's good to know any other questions otherwise we'll visit Dennis going to testify that in terms of the analysis that was undertaken by George so for the record I've never written on a consultant to the giant fiscal office and if you have maybe five minutes I can take you through this picture first it will sort of explain why the section two in the bill okay so this is just an example of one of the families in the basic needs budget this is a two-parent family two working parents two children the children are six and four the six year old goes to school full day but needs childcare after school the four year old gets pre-k but otherwise has children full-time and so across the bottom is a household at different wage levels so this the numbers across the bottom would be their total wages then the height of the bar represents the total resources that they have available to them to meet their basic needs so the blue dark blue part the bottom part is what they end up with as their after-tax income this year that goes up the bottom wedge that goes up smoothly then on top of that you have monthly benefits which are mostly in this case Medicaid going into the exchange health care also fuel assistance and let's see then the other ones that we have are food stamps which is a fairly big one to stand on its own and it's all federal then after that the blue color is tax credits and that shows significantly the EITC at the low end yes and then the top part is child care subsidy and I've also included in that purple color on the top pre-k which is why it continues up at the high income because pre-k goes to everybody no matter what income and so then if you look at the bottom where I've shown a little arrow on the bottom minimum wage current law and then if it were $15 an hour in the same year and then you look at what's happening at that income range and their net resources are actually dipping down in that income range and it's what exists now it's not caused by the minimum wage change we have this issue where before people are really making ends meet if they earn another dollar they can lose more than a dollar and it's a combination of everything however if you just visually take off that part you can see that the family if they didn't need child care even though they're losing other benefits they continue to increase the light blue if you take off that purple in the very top that's that's what we're trying to fix and ideally we would fix the whole benefits system so that the things didn't fade out at the same time and so that they kept going longer and so that that phase out schedule each one made sense but a lot of these are federal that child care one although it is federal we fund more than that amounts we have much more flexibility and continuing to fund it and change the rules so the idea was to do those two things that are mentioned in the bill one is to recognize that the cost of child care would go because child care workers many of them are paid less than what would be the $15 minimum wage and the second is we would try to make it so that people who hadn't increased their income equal to the increase in the minimum wage would not lose would not go on this downslope so essentially what we'd be doing is we take that sliding fee scale where the subsidy phases out and it has income brackets just like our income tax when we want to avoid bracket creep we index the income brackets by the CPI in this case we index the subsidy brackets for the child care thing the minimum wage the change the minimum wage so that where you're seeing that slope down or about 45,000 and so forth right you just move it it will still slope down but you'll move it over so that you're filling this in slice by slice the next year it move over a little bit more next year it move over a little bit more we wouldn't solve the problem completely but we would slice by slice we'd solve it and I remember a few years ago when we were presented this and the issue and so what's the answer and the answer was it was so daunting to think that we could completely fill that in that we can come up with it but anyway this is a way to do it so at the same time that the minimum wage is increasing and you know people are reaching these stages we're also getting more money from income tax from these people because more income and we're also getting savings from other programs so in for 2020 this would be a half of a year because this would take place January 1st so we're estimating that the cost would be that $800,000 but we also estimate that we get 1.3 million dollars in increased revenue and savings from other programs not to say that it would all be directed to this but we would have that coming in so we could cover the cost but that's the issue is how we can target that money or you know how to make it appropriation links to this and then we forget all the way to 2024 and in 2024 dollars the cost would be 11 million 11.1 million over current law and that the increased revenue and savings would be 18.3 I haven't done calculations for the interim years but last year when we did it it was the first year was the most difficult one and then you know that revenue increased faster than the cost and last year we were writing this we knew that our base and child care was a bit high remember and we knew that and therefore we wrote it in such a way that we knew that that money was there in the base and it was because caseload was down and it gave us the capability within the appropriation to to absorb that first year as you're saying before the off setting revenues materialized I don't think we're quite in the same place this year but that's what we'll have to figure out relative to last year was easier because of that because of that base and we knew the money was there because this year we still had that 2.5 million in the base and about 25% of it would have and we also but we did but that was simply the increase of particular area but yes that's true and we put it into infant and toddler rates and we brought their rates up to 18 rates and that helped us to carry you know but we still have rates for school age and preschool that are 2008 rates well we have another proposal to address that but I'm just saying in terms of funding that relationship between minimum wage and the child care last year was we were in a different spot so to speak so okay thank you other questions so yeah well really a question it being an employer I'd hate to have to pay my employee $2.00 $3.00 more an hour and still not have them get up to the line and then have them actually lose a buck or two from their services yeah I if you're really going to help people let's help them and and straighten out both sides of it the employer should be paying more but we shouldn't be cutting cutting it off in there we should be taking the extra money and building that in but not just for one notch at a time to take like 14 15 years to get to the end if you only get one line a year I think there's 14 or something and by the time you got to the end you'd have another sag up above me just a matter of where the sag occurs at the higher income well the cost of living keeps going up and the cost of child care and everything else so we do have to address the commitment is to address the most pressing impact on the child care subsidy for lower income working families and last year as I said it was easy because we knew we had the child care appropriation to accommodate that protection so David unless we have further questions of that we have and we have a whole hour for vets home yeah I meet with them now you probably have to leave them for about 15 20 minutes well then why don't we take the break but I hate to have them so they're going to have an hour and 15 minutes or half of time huh okay I'm just wondering if how people want to do it I know people have gotten sometimes appointments that are booked during the break do you want to break come back on this at 3 30 which means we're going to be pushing the vets home later in the afternoon I'm getting picked up by the shuttle 425 well why don't we shorten the break time and come back about 20 after and dick if you're a little bit late but well I know what you're it really would be nice to have some mechanisms so that would be nice to go on yeah every year and it's somehow the basis of right and you know what they adjusted factors to be but that's not what we have okay so 20 minutes if you could be back we don't have the pro tem here in your way in case we do what is the problem with putting a book on the floor because they don't want you to step on it I'm not going to step on it over there if you want I can put it here both you and Diane Snelling had to always go over there to get the book I don't know why you can't leave it somewhere right around there yeah we couldn't hopefully you're over I'm not getting keep us I'm just saying it's been going on for years committee we have two things left one is to finish the discussion on the minimum wage and whether we want to vote on it today or not the pro tem is not here and he needs to be when we vote we do have Damian lemon amendment that makes it clear that if someone's appointed who is getting paid as part of their job they don't get the per diem which is just more of a technical we have in our area if we agree to the language that the house about the economic development has it is making it clear that our intent is to recognize the cliff impact on the child care benefit both on providers I know that they took a lot of testimony and I think you know the concern and I think we need to be very conscious and I think this gets back to some extent what Bobby was talking about but many many services are funded by state government and I'm talking about nurse you know as senator Westman said DNA but also our nursing homes and they want to get medicaid or where they are providing a personal service it could be use services for example I don't know but if we are basically saying that we want this wage to move up then those of us who sit around this table have to recognize that those costs are going to come back and have to be recognized and we have experienced it in some extent with with the contract negotiations with our personal care providers where the budget found accommodation to address those salary increases and I think that's one of the concerns is that we understand the collateral impacts are way beyond the child care program and it is going to put pressure and an obligation on the other hand I know that we've had this circular discussion many people are concerned that low wages externalized costs of the government programs and the and that government are providing benefits that are at a level greater than they need to be now maybe when we get into the full return of this and the analysis that's done by joint fiscal and staff the return back either in terms of avoided savings on benefit programs or additional revenue that might come in in the form of taxes Car keys? I guess so You want me to embarrass that? Nobody would want my car Kitty borrowed it but she must have gotten back Well it's a stick shift and she hasn't driven one for a long time but I think she made it well it is old and it's dirty too she told me was quite in need of care I don't care all I do is want to key and turn it on and go down the road so my only point is yeah getting back to the wage is that we need to understand what those collateral impacts on the other hand we can say as a state of Vermont we have an obligation to pay people a decent wage and the extent to which we have had people work in these programs What? Nicolapses Well or we're going to have to we've been providing extraordinary relief So oh boy we're getting killed on the House bill H-57 To amend what? The wage bill? To do what Bobby? To do what? Well if we're only bothered out of here maybe we could fix it so it would be a little bit more palatable Well the big problem is if you want to expand protection here in advance the more money you have to advance before the revenues and those service reductions kick in that's so I think what we were talking about last year was a half year cost was 800,000 with an 800,000 total close to that so that's what we're deciding on right now we're not appropriating it this is just language and this creates an expenditure that we have to address when we build the budget Knowing what our fiscal situation is at this point to extend beyond this right now I don't see how we can do it I'm just saying we're going to have to recognize those costs out in the future years because like nursing homes are going to have to meet those higher costs and that's going to have to be recognized in the rates that they're paid and we don't do a direct appropriation that way to them in the same way we do for childcare So I'm not going to sit without the pro tem here I'm going to just hold off a vote on this Further testimony We can pass out for people's consideration it's the technical change relative to the compensation for who's going to be on that study committee and we will defer a final action until tomorrow and I know that we're running against a clock that's going to be 20 after you said and so we have on the schedule and you have to So I'm going to at this point we will just move on from minimum wage people have more questions or concerns I think we know that this is a complicated issue and one that I don't want to pass out right now simply to give people more time to consider and to have the pro tem here as well when we do the roll call on it