LANSING, Mich. - Michigan Gov. Rick Snyder signed legislation Tuesday to raise the state's minimum wage by 25 per cent gradually over the next four years to $9.25 an hour, as Republicans controlling the state government moved to head off a November ballot measure that could have raised pay even more.
The House and Senate passed the bill Tuesday, one day before a group of labour and community organizers planned to submit hundreds of thousands of petition signatures calling for a Michigan ballot initiative to raise the minimum wage to $10.10 an hour.
The current hourly minimum wage is $7.40.
The higher rate is supported by President Barack Obama and national Democrats, who have made the minimum wage a signature issue this election year. Snyder is up for re-election this year, as are many Michigan state legislators.
Michigan is the first state with a Republican-led legislature to raise its minimum wage this year, according to the National Conference of State Legislatures. Connecticut, Delaware, Hawaii, Maryland, Minnesota and West Virginia have raised their minimum wages, as well as the District of Columbia. Vermont's legislature has passed an increase but it has yet to be signed by the governor.
"This was a great exercise in bipartisanship and both chambers working together in close partnership, coming up with an agreement and executing on that," Snyder said. "It's good for the hard-working people of Michigan."
The Michigan Restaurant Association, National Federation of Independent Business and other business groups have said a wage increase would cut into businesses' profits, which could cause closures and layoffs. The Republican governor said the measure is "economically sound."
Senate Majority Leader Randy Richardville, R-Monroe, said he introduced the bill to repeal and replace the law that the ballot initiative aims to amend. It is unclear if the new law could prevent the $10.10 measure from appearing on the November ballot.
"We'll just have to see how that process flows," Snyder said when asked by The Associated Press.
The Michigan House voted 76-34 and the Senate 24-12 for the bill. Roughly half the Republicans in the Legislature voted for it, along with most Democrats. Some Democrats said they voted no because the bill silences voters who signed the wage petition.
Richardville said "everybody gave a little and everybody got a little." It was a difficult compromise for many in both parties to support, Rep. Jeff Farrington, R-Utica, said.
"I'm going to do this with a heavy heart because I don't believe government has a place adjusting wage in our society," Rep. Peter Pettalia, R-Presque Isle, said. "I step up and support this bill because the alternative is terrible. The proposals that are in front of us outside of Senate Bill 934 will lose many more jobs in northern Michigan."
The legislation includes a provision requiring the minimum wage to grow annually with inflation by up to 3.5 per cent starting in 2019. It also would increase the wage for workers who get tips to 38 per cent of the minimum wage, from $2.65 currently, to $3.52.
Senate Minority Leader Gretchen Whitmer, D-East Lansing, and House Minority Leader Tim Greimel, D-Auburn Hills, said the ballot drive led to the legislative action.
"We know this is the only Republican conservative Legislature to consider an increase in the minimum wage, and that's a direct result of our work on the campaign," said Danielle Atkinson, a representative for Raise Michigan, which is leading the ballot drive.
Raise Michigan will still turn in signatures Wednesday because organizers feel an obligation to roughly 300,000 people who signed the petition, Atkinson said. The issue could end up in courts because Michigan is in "uncharted territory," she said, contending she has never seen a legislature repeal a law about which citizens are petitioning the government.
Raising the minimum wage was set to be a hot topic in Snyder's race against Democratic governor candidate Mark Schauer. The bill is very similar to Schauers' proposal from November to raise the wage to $9.25 over three years and tie it to inflation.
Associated Press correspondent David Eggert contributed to this report.
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