What makes Oregon's minimum wage bill so unique?

In legislation approved Thursday by Oregon lawmakers, the state's minimum wage will soon increase on a tiered system by region. How that plays into a nationwide conversation about minimum wage.

Molly J. Smith/Statesman-Jour­nal/AP
Oregon state Rep. Jennifer Williamson, (D), speaks during a vote to increase the minimum wage, on Thursday in Salem, Ore. The Oregon House of Representatives on Thursday approved landmark legislation that not only raises the state's minimum wage for all workers to the highest level in the country, but does so through an unprecedented three-tiered system that sets different rates by geographic region.

The minimum wage in Oregon is about to get a whole lot higher.

On Thursday, Oregon lawmakers approved legislation that makes the state’s minimum wage the highest in the United States. The state’s Democratic governor, Kate Brown, said in a statement that she intends to sign it into law.

"I started this conversation last fall, bringing stakeholders together to craft a workable proposal; one that gives working families the much-needed wage boost they need, and addresses challenges for businesses and rural economies presented by the two impending ballot measures," Governor Brown said.

The bill is unique to Oregon in that it will implement wage increases by region over the next six years. The state already has one of the highest minimum wages in the nation at $9.25, but by 2022 that would increase to $14.75 in Portland, $13.50 in smaller cities like Salem and Eugene, followed by $12.50 in Oregon’s rural communities.

The increase also reflects the divide in Oregon between rural and urban communities, where the cost of living has soared in Portland even as rural farming communities struggle to make ends meet. Many Republicans in Oregon’s Capitol Building have opposed the increase.

"This enormous increase will force many family farmers to try to find ways to mechanize or transition away from labor-intensive products Oregon is known for, like apples, pears, milk and berries. Unfortunately, some will give up and sell, while others will simply go out of business,” Barry Bushue, president of Oregon Farm Bureau, told The Associated Press.

But Democrats who support the legislation say that while it doesn’t solve all of the inequality issues that Oregon has, it is one small step forward.

"Oregon has always been at the forefront of new ideas in the country. We were the first to actually have a minimum wage," Rep. Paul Holvey, a Democrat from Eugene, told AP. "Trust me, we're not solving all the problems, but we are making a substantial dent in it by pushing up from the bottom some wage equality ... from the huge disparity we have in incomes."

Massachusetts, California, and Vermont all recently hiked their minimum wages above $10, but this legislation will put Oregon’s minimum wage ahead of Massachusetts as the highest in the country. Both Bernie Sanders and Hillary Clinton have made raising the minimum wage pillars of their campaigns for the Democratic presidential nomination, and there has been an ongoing nationwide discussion on the “Fight for 15,” which seeks to raise the minimum wage to $15 or more an hour. In January, 14 states and some cities like Seattle elected to raise their minimum wages as the national conversation of what constitutes a “living wage” continues.

Despite the momentum, however, campaigns to raise the minimum wage have not been successful in every state. Critics of the “Fight for 15” movement have contended that it is too high of a raise too fast for small businesses to handle. A proposal to raise the minimum wage to $15 an hour in Portland, Maine, was rejected in November of 2015.

David Cooper, an economic analyst for the Economic Policy Institute in Washington, D.C., told The Associated Press that while wage increases are generally a good thing, he does have some hesitations about the regional approach included in Oregon’s legislation.

"I think any time you create these sorts of somewhat arbitrary geographic districts, that's when you can create opportunities for some sort of economic disruption," he said. "I would prefer the whole state got to the same wage level but at a slower pace by region so that everyone is held to the same standard."

This report contains material from the Associated Press.

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