Chamber Questions City of Tucson Priorities

On Tuesday of this week the Tucson City Council met in an afternoon study session to discuss the subject of mandatory paid time off for employees of companies still trying to do business in Tucson.  This discussion follows a pattern promoted by Big Labor across the country.  Expect a companion measure promoting a hike in the minimum wage to $12 or $15 an hour sometime soon.  The same scenario is being played out in various East and West Coast cities (Seattle, Portland, DC and San Francisco, for example) and is now bleeding its way inland.

Both measures are job killers.

The ultimate irony of the Council’s vote on Tuesday to form a stakeholder group to study the mandatory paid time off proposal comes exactly on the same day that the Milken Institute released its annual list of America’s Top Performing Cities.  Of the top 200 cities in the U.S., Tucson ranked #175, a drop of 14 places from the 2014 position of 161.  Key metrics in the study included job growth and wage growth.  We agree that job growth and wage growth are KEY to improving this region.  The reality is that regulating job and wage growth does not work – it drives business away.

And oh yeah, there is that thing called the city budget.  It was only 72 hours earlier than the study session that the Council heard the news from City Manager Mike Ortega that the City of Tucson doesn’t have any money.  With the vast majority of the City’s revenue coming from sales taxes, one would think the Council would be doing everything it can to spur business creation and promote consumer spending.

Bottom line: While a respected national study says Tucson is in a free fall to the bottom in job and wage growth and the city manager is planning cuts in City staff, the Tucson City Council’s response is to form a stakeholder group to discuss making it more expensive and more difficult to create jobs in our city.  To be clear, a number of Council Members expressed concern during the discussion and had some reluctance to forming this stakeholder group, especially in light of the city manager’s need to prioritize the budget woes.  The fact it did vote 6-1 to form the committee is still startling and amazing.   The Chamber commends Ward 6 Council Member Steve Kozachik for standing firm against this measure as the only “no” vote.   Council Member Kozachik noted that the city is in a budget crisis and has much more important things on which to spend its time.  He’s right.

Proposals like mandatory paid time off and huge increases in the minimum wage are certain to be central points in any future discussion about the City annexing more Pima County property.  I can hear it now, “Become a part of the City and let us tell you how to manage your workers and increase your costs.”  And I can only imagine the glee in Marana, Oro Valley, Sahuarita, the unincorporated parts of Pima County and yes, even Phoenix, if the City of Tucson adopts mandatory paid time off, hikes its minimum wage and starts exporting employers.

In the best-selling book, The Coming Jobs War, author Jim Clifton, chairman of Gallup Research concludes, “Cities need to develop a job growth attitude, align their local forces and declare an all-out war.”  He goes on to say, “The jobs war is what should get city leaders up in the morning, what they should work on all day and what should keep them from getting to sleep at night.”

Response from local business owners has been swift.  One prominent local employer with about 100 employees wrote, “I love Tucson so much, but these kind of ideas are the ones that will likely force my hand to pull up stakes in order to leave Tucson someday, especially the $15.00 an hour one.  So sorry to say, but that one would be a deal breaker, as it would kill my company within a matter of months, no doubt!”

The supposed goal of these onerous measures is to help the working poor.  The heavy hand of government telling businesses how to operate doesn’t do that.  Only the creation of jobs will lift the poor out of poverty.  Take for example the hundreds of jobs averaging $60,000 per year with full benefits that Grand Canyon University would have created if not shown the door by Ward 1 Council Member Romero and the rest of the City Council.

The Tucson Metro Chamber will monitor this onerous proposal and take whatever action we believe is appropriate to address it.  Higher wages and job creation are the end goal for EVERYONE involved.  The Tucson region needs to understand how to achieve that goal without the unintended consequence of driving business out of the City.  This measure, if passed as suggested on Tuesday by Ward 1 Council Member Regina Romero in the study session dialogue WILL kill jobs.  Tucson needs more jobs and better jobs and we need them now.

Sincerely,

Michael V. Varney
President & CEO