MONTPELIER – On Thursday, the Vermont Senate will hold a vote that will likely override Governor Phil Scott’s veto of S.23, a bill that would raise Vermont’s minimum wage to $12.55 an hour.
The Senate passed the bill in January with a veto-proof majority, but the Vermont House fell seven votes short.
In his veto letter, Scott said fiscal analysis projected job losses, a decrease in employee hours, and increased cost for goods and services if S.23 was enacted. Senate President Pro Tem Tim Ashe (D/P-Chittenden) has taken issue with Scott’s analysis, and said it signals the “Governor’s use of the word ‘affordable’ has no meaning.”
“The idea that $120 million in wages for these 40,000 people over the next two years would not be in their best interest, which the Governor actually claimed in his letter, it’s almost impossible to understand how someone could reach that calculus,” Ashe said.
Ashe believes Scott’s veto isn’t a disagreement with the Legislature, but a battle between Scott and the workers that money would’ve gone to. Scott said the bill has “good intentions,” but views the veto as a necessary protection for rural Vermont’s businesses.
Vermont Secretary of Commerce Lindsay Kurrle elaborated on the Administration’s reasoning.
“They [rural businesses] may already be struggling, and then you throw this on top of them, and it just exacerbates the problem,” Kurrle said. “Then, they ultimately end up cutting hours for workers, so they’re taking home less annually in their paycheck.”
Vermont’s current minimum wage of $10.98 an hour is the 12th highest in the nation. Had S.23 passed, Vermont would’ve jumped to fourth behind Massachusetts, California and Washington.
Last session, Democratic and Progressive legislators pushed for a $15 minimum wage within five years. Ashe felt a $12.55 minimum wage in two years was a reasonable compromise.
“States that have taken measures of a more modest nature like Vermont usually see a slight uptick in employment and an increase in economic activity,” Ashe said. “The facts on the ground are completely at odds with the Governor’s veto letter and the reasons he says he kept these people from getting a pay raise.”
The Scott Administration argued that if the minimum wage was directly correlated to economic prosperity and workforce growth, Vermont would have a stronger economy and larger workforce than neighboring New Hampshire.
“We have to look at it broadly, not just the impact on workers, but our state as a whole from an economic perspective,” Kurrle said. “What does it do to our communities and downtowns? We have to take all those factors in, and we feel like there’s other paths forward.”
When asked what those paths were, Kurrle said workforce development investments like the Vermont Training Program are giving people the opportunity to earn higher wages while making an impact on affordability.
The Vermont Raise the Wage Coalition, a group of advocacy organizations, slammed the veto.
“Gov. Scott’s veto is not only disappointing, but unsupported by the facts as was evident in his veto message that relied on disproven economic myths.”