An effort to boost the wages of some low income workers is set to face a key vote in the City Council today. Proponents want workers at a large city-backed development project in the Bronx to get more than minimum wage. But the developer of the Kingsbridge Armory says that will kill the project.
In New York City, almost a quarter of rank-and-file retail workers earn less than $8 an hour, according to a report from the liberal Fiscal Policy Institute.
One of them is Alex Montas, a 21-year old from the Bronx.
"At first it was okay but then like as the months pass, the time passes, you realize you are working too hard and not getting enough money," Montas says.
Montas is a maintenance worker at a Daffy’s in Midtown. He earns $7.45 cents an hour. That comes out to about $15,000 for a full year’s work, before taxes, and no health insurance.
"Each maintenance is supposed to be doing one floor. Sometimes somebody calls out and you have to do two floors and they want everything to be clean," he says.
Montas has lived his whole life within a few blocks of the former National Guard Armory in Kingsbridge, a section of the northwestern Bronx. A developer wants to turn the armory into a shopping mall. But a coalition of community groups and labor unions has put up a stiff fight, demanding that any retailers that lease space there should pay at least $11.50 an hour, or $10 an hour if benefits are included. They’re calling this a “living wage.”
"People work really hard for a little bit of money, so I mean, you should try to—progress and help things out," he says.
The battle over the Kingsbridge Armory is just the latest chapter in the history of the living wage—the idea that certain employers should pay more than the minimum wage, which is now $7.25 an hour.
Stephanie Luce, an associate professor at U-Mass Amherst, says the modern movement began 15 years ago in Baltimore. That city had redeveloped its waterfront. But food pantries noticed the people who were coming to them had jobs, and still couldn’t make ends meet.
"The mayor and so forth had promised that this would bring jobs to the city and it did in the sense it was bringing jobs but they were low wage retail jobs," Luce says.
More than 140 cities have adopted living wage ordinances. But most of them, including that original one in Baltimore as well as one New York City enacted, apply only to city contractors. They do nothing for retail workers. Which is why people like Ruben Diaz Jr., Bronx Borough President, have targeted the armory project.
"We are sick and tired of leading the nation as the number one county in poverty rates," Diaz says.
The armory developer is getting about $18 million in city and state tax incentives. Diaz is threatening to kill the project—and all of its 1,200 promised jobs—if those jobs don’t pay a living wage.
"Bronxites have been seeing development all over the place and they’re seeing the people who are making a profit, people who are making a good living from developing, don’t live in this borough," he says.
As an example, Diaz points to a new shopping mall that opened in the South Bronx this year, the Gateway Center at Bronx Terminal Market. Its developer is the Manhattan-based Related Companies. It’s the same company that’s trying to renovate the Kingsbridge Armory.
Jesse Masyr is their lawyer.
"They are not 100 percent all the jobs going to be career path jobs. That’s correct. They are entry level jobs the way people enter into the workforce. So a lot of it is first time employees who are hopefully going to advance further on," Masyr says.
Related says it will abandon the project if it’s forced to guarantee 100 percent living wage jobs. Masyr says no national retailer would choose to take space in a mall with that sort of mandate.
"We don’t think that a company is going to change its corporate policy for this one site," he says.
There’s just one comparable project in the country that’s adopted a similar living wage requirement. It’s in Los Angeles. It’s also supposed to be built by the Related Companies. But that project is stalled because of the economy.
David Neumark, an economist at the University of California at Irvine, doubts that retailers would give up on the Kingsbridge armory if they had to guarantee a living wage. But he says companies will respond by hiring fewer, but more qualified, workers.
"They say the reason we are hiring these guys at $7 an hour is that’s what they were worth. It’s a cold thing to say but that’s kind of how labor markets work," Neumark says.
Alex Montas may well qualify for one of those living wage jobs. He’s got a associate’s degree and more than a year’s experience at Daffy’s under his belt.
"It doesn’t have to be exactly $10 an hour, it could be $9, but not minimum wage," he says.
Montas lives with his parents but is trying to save up to continue college. He says he’d love the chance to earn more, and work closer to his house. But he also doesn’t want to sacrifice the project for the sake of higher wages.
"A lot of people want a job right now. It don’t matter if they pay $5 or $6. They just want money," Montas says.
A city council subcommittee is scheduled to vote on the armory this morning.