What did Governor Brown's own Department of Finance say about a $13 minimum wage?
"...impact on economy and budget likely to be negative"
"...would lead to slower personal income growth"
"...lead to slower employment growth"
"...negative impact on taxes collected"
Monday, Governor Brown announced a deal with Democratic legislative and labor leaders to raise the minimum wage to $15 as a "matter of economic justice," saying, "it makes sense and will help our entire state do much better for its citizens."
But, California already has some of the nation's HIGHEST taxes and regulatory costs driving small businesses out of the state. That's why the Governor's own Department of Finance issued stern warnings last year when a $13 per-hour minimum wage was proposed in SB 3 (Leno).
Here are excerpts from the March 11, 2015 Department of Finance Bill Analysis:
"In addition to impacts on individuals and California businesses, increasing the minimum wage will result in increased costs to various state entities for paying the higher minimum wage of at least $393.6 million ($129.2 million General Fund) in 2015-16, $959.1 million ($407.8 million General Fund) in 2016-17, and $3.4 billion ($1.2 billion General Fund) in 2017-18."
"Finance notes the net impact of an increased minimum wage on California’s economy and state budget is likely to be negative. For the economy, losses from higher production costs to businesses would be partially offset by the consumption boost from wealthier minimum wage workers, but would overall lead to slower employment growth."
"This would lead to slower personal income growth, and an anticipated negative impact on taxes collected, especially since the tax structure in California is highly progressive and lower income individuals pay little to no income taxes."
"Sales taxes under the provisions of this bill may increase, but they are not anticipated to increase enough to offset lower personal income taxes. Although the state would save some money on lower provision of benefits under some state funded programs, the increased expenses from paying state workers would more than offset those gains."