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06-10711 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 Chapter 98 of the Saint Paul Administrative Code is hereby amended to include the following new chapter: Chapter 98. Living Wage Sec. 98.01. SHORT TITLE. This Ordinance shall be called the "Saint Paul Living Wage and Responsible Public Spending Ordinance." Sec. 98.02. PURPOSE. Recognizing that the City awards business subsidies and is a major contractor for services, the City enacts this Ordinance to promote the creation and retention of living wages and full time positions, and to increase the wages of service employees and employees whose employers are subsidized by the City ar whose employer enters into a contract with the City in order to improve pubiic health and welfare, promote the economic strength of the City, and reduce the pressure on governmental services and programs. Nothing in this Chapter shall abrogate or modify any rights or obligations specified in Chapter 85 of the Saint Paul Administrative Code. :�i�'� �_�'�`` CouncIl File # 06-1071 Amended 12/27/06 Green Sheet # 3C34613 ORDINANCE CITY OF SAINT PAUL, MiNNESOTA Presented By ��.�. An ordinance adding °"`� � Chapter 98 to the c�t � Saint Paul Administrative Code � '� �� for the purpose of establishing Saint Paul's Living Wage Requirements THE COUNCIL OF THE CITY OF SAINT PAUL DOES ORDAIN Secrion 1 1 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 !(�-jl7/ Sec. 98.03. DEFIIVITIONS. A. `Basic health insurance" means (1) an insurance or self-insured group health plan includina anv federallv anproved self-funded plan established under the Emplovee Retirement Income Securitv Act of 1974 (ERISAI as amended where an employer pays at least seventy-five (75) percent of the premium for individual coverage plus fifty (50) percent of the premium for family coverage; deductibles and out-of- pocket masunums cannot be greater than those allowed by the Internal Revenue Service for Health Reimbursement Arrangements and plan design must meet the minimum required by Health Reimbursement Arrangements and State Law (2) a deductible insurance plan offered by an employer where in-network deductibles do not exceed twenty-five (25) percent for office visits, inpatient care, outpatient caze and/or urgenUemergency care, there is a one thousand five hundred dollars ($1,500.00) out of pocket maYimum for individual and three thousand dollars ($3,000.00) out of pocket maximum for family, and any out-of-network deductible plan's out-of-pocket maximum does not exceed two thousand dollars ($2,000.00) for individual and four thousand dollars ($4,000.00) for family; or (3) an employer offers a health plan not less in value than that provided to first level supervisory employees provided that the benefit costs employers a minimum of seventy-five (75) percent ofthe difference between one hundred ten (110) percent and one hundred thirty (130) percent of the federal poverty level for a family of four (4). � C. "City" means the City of Saint Paul and the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota. "City Contractor" means a for-profit or not-for-profit entity or person that is a party to a City Contract. D. "City Contract" means a contract for services and any amendments thereto between the City and City Contractor not covered by Section 82.07 of the Admimstrative Code with the City valued in the aggregate at $100,000 or more. A City Contract does not include (a) a contract whereby the City Contractor manages City owned land and/or improvements on behalf of the City's parks department and the City Contractor pays a portion of the revenues to the City or (b) a contract whereby the City Contractor provides depository and/or financial services to the City, or (c) a contract whereby the City Contractor provides coniract health care benefits to city employees. Nothing is this Chapter shall abrogate or modify any rights or obligations specified in Chapter 85 of the City's Administrative Code. E. "City Business Subsid}r' means any of the following extended by the City to a recipient with a value of $100,000 or more: (a) a grant, (b) a contribution of personal properiy, (c) a contribution of real property, (d) with respect to a loan given by the City, the present value of the difference in the interest rate given by the City and that rate commercially available to the recipient, (e) any reduction or deferral of any tax, assessment or fee, ( fl any guarantee of any payment under any loan, lease, or other obligation, (g) tax increment financing, (h) the issuance of revenue bonds, (i) tax credits, or (j) other City participation. Conduit bonds and infrastructure are not a City Business Subsidy. 92 93 94 95 96 97 98 99 100 101 102 103 104 105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 128 129 130 131 132 133 134 135 136 137 138 139 140 ��-�02( F "City Business Subsidy Recipient" means a for-profit or not-for-profit entity that receives a City Business Subsidy. G. "City SubcontracY' means a contract for services between a City Contractor and City Subcontractor valued at $100,000 or more to perforxn a portion of the services described in a City Contract. H. "City Subcontractor" means a for-profit or not-for-profit entity or person that is a par[y to a City Subcontract. I. "Job readiness and training services" means services whose purpose and intent is to help individuals establish a stable work history by addressing the social and economic barriers to employability, including training, apprenticeship, and adequate day caze. "Sole source" means a source of products or services that is the only viable market option for the City. K. "Tenant" means the initial for-profit or not-for-profit entity or person that leases from a City Business Subsidy Recipient space in the specific location for which the City Business Subsidy was provided, or if there is more than one such initial entity or person then it means the entity or person that leases the greatest amount of space and any entity or person that leases space of 15,000 ar more square feet. L. "Tenant Subcontactor" means a person, other than an employee of a Tenant, who performs services at the specific location for which the City Business Subsidy was provided under a contract between that person or that person's employer and a Tenant. Sec. 98.04. . LIVING WAGE/JOB CREATION AND RETENTION A. PAYMENT OF LIVING WAGE City Contract; Citv Subcontract. Any City Contract, or City Subcontract must require City Contractors and City Subcontractars to pay an hourly wage that is at least the living wage for the duration of the contract to each employee who is working pursuant to the City Contract or City Subcontract or who is employed in the specific location for which the City Contract or City Subcontract is intended to benefit. 2. Citv Business Subsidv. Any City Business Subsidy Recipient and Tenant must agree to pay an hourly rate that is at least the living wage to each employee who is employed in the location for which the City Business Subsidy was provided and a Tenant must pay at least a living wage to each Tenant Subcontractor for the longer of the following: (a) the duration of the City Business Subsidy Agreement, or (b) three years. 141 142 143 144 145 146 147 148 149 150 151 152 153 154 155 156 157 158 159 160 161 162 163 164 165 166 167 168 169 170 171 172 173 174 175 176 177 178 179 180 181 182 183 184 185 186 187 188 189 B. CALCULATION OF LIVING WAGE Ol� - l0�/ The living wage shall be a wage level equivalent to at least 130 percent of the federal pover[y levei for a family of four. For employers that provide employees basic health insurance, the living wage shall be a wage level equivalent to at least 110 percent of the federal poverty level for a family of four. The living wage shall be based on the then current federal poverry level and shall be adjusted within one week after the federal government adjusts the rate. C. JOB CREATION AND RETENTION A City Business Subsidy Recipient must enter into a City Business Subsidy agreement with the City that includes: (1) a description ofthe subsidy; (2) a statement of the public purpose for the subsidy; (3) goals for the number of jobs created and/or retained; and (4) wage goals for any jobs created and/or retained. D. APPROVAL OF CITX CONTRACT AND CITY BUSINESS SUBSIDY All City Contracts and City Business Subsidies must be approved by the Saint Paul City Council and/or the Board of Commissioners of the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota by a resolution approving a budget or the City Contract or City Business Subsidy. E. EXEMPTIONS 1. Entities. The following entities are exempt from the living wage requirement: a. any incorporated entity, organized far profit, that falls within the definition of a small business under Minnesota Statute 645.445; b. any 501 (c) entity which falls under the criteria laid out in Minnesota Statute 645.445, subdivision 2; c. a recipient of a City Contract, City Business Subsidy or City Subcontract that contains an express provision that the purpose of the contract or subsidy is job readiness and training services and that the recipient is exempt from the living wage requirement; d. any recipient of a City Contract, City Business Subsidy or City Subcontract for whom the City Council determines that application of the living wage reyuirement would conflict with a state or federallaw or program requirement; e. any recipient of a City Contract, City Business Subsidy or City Subcontract which is bound by a collective bargaining agreement for the period of the contract or the subsidy; 190 191 192 193 194 195 196 197 198 199 200 201 202 203 204 205 206 207 208 209 210 211 212 213 214 215 216 217 218 219 220 221 222 223 224 225 226 227 228 229 230 231 232 233 234 235 236 237 238 239 240 �l� - l�7/ any recipient that is an intermediary, such as a community development corporation, community investment group, or community bank, which serves as a pass-through agency for the granting of assistance; g. 501 (c) enrities that aze sole source providers of product or service. 2. Em l�oyees. a. A recipient of a City Contract, City Subcontract, or City Business Subsidy and a Tenant may request and obtain exemptions from the living wage requirements for the following types of employees: 1. Temporary internships or similaz posirions that are intended to provide cazeer exposure to new entrants to the workforce, lasting no more than 12 consecutive months; 2. Individuals who are placed with the employer as the result of a job readiness or job training program or who are participants in an employment program that provides work opporiunities for those with serious mental and physical barriers to employment or similar employer sponsored work opportunity program for individuals with serious mental and physical barriers to employment; 3. Seasonal, part-time or temporary employees whose employment does not reduce or offset the work of permanent employees, on the conditions that (a) no more than ten percent (10%) of such seasonal, part-time or temporary employees can be exempted, and (b) that the City Contractor, City Subcontractor or City Business Subsidy Recipient is not intending to utilize such labor to avoid the requirements of this ordinance. F. ENFORCEMENT 1. Any recipient of a City Contract or City Subcontract that fails to meet the living wage requirements of this Ordinance at any time during the duration of the contract, and any City Business Subsidy Recipient that fails to meet the living wage or wage goals and other requirements of this Ordinance at any time during the duration of the subsidy, shall (a) not be eligible for a City Business Subsidy or City Contract in the next contract cycle or the next calendar year; and (b) shall repay to the city an amount determined as follows: the entire value of the contract or subsidy if compliance is less than 50% of the requirement, one-half of the value of the contract or subsidy if compliance is 50% or mare but less than 80% of the requirement, and proportionate to the value of the contract or subsidy if compliance is 80% or more but less than 100% of the requirement. 2. No City Contractor, City Subcontractor City Business Subsidy Recipient or Tenant shall discharge, demote, harass, or otherwise take adverse action against any individual because such individual seeks enforcement of the living wage requirement or testifies, assists, or participates in any manner in an investigation, hearing, or other proceeding to enforce this Ordinance. 3. No City Contractor, City Subcontractor City Business Subsidy Recipient or Tenant shall split or subdivide a contract or subsidy, pay an employee through a third party, or treat an employee as a subcontractor or independent contractor to avoid payment of a living wage. 241 242 243 244 245 246 247 248 249 250 251 252 253 254 255 256 257 258 259 260 261 262 263 DCo �D�( 4. This Ordinance shall be enforced by the Deparnnent of Planning and Economic Development, or its successor agency, with respect to a City Business Subsidy, which shall propose regulations for Council approval as are necessary to implement and administer compliance with the City Business Subsidy. This Ordinance shall be enforced by the Office of Financial Services or its successor agency, with respect to a City Contract, which shall propose regulations for Council approval as are necessary to unplement and administer compliance with the City Contract. Enforcement shall include but not be 1'united to receiving, investigating and attempting to resolve complaints by employees and Tenant Subcontractors. Any recipient of a City Contract or City Business Subsidy or City Subcontract or Tenant shall provide written notice to its employees that they may be covered by the terms of this Ordinance as specified in section 98.04 (A) and shall also provide its employees a written copy of this Ordinance. Sec. 98.05. APPLICATION. This Ordinance shall apply to any City Contract, City Subcontract or City Business Subsidy executed afterthe effective date ofthis Ordinance. 264 Sec. 98.06 SEVERABILITY. 265 266 267 268 269 270 271 272 273 274 275 276 277 278 279 280 281 If any provision or application of this Ordinance is declued illegal, invalid, or inoperative, in whole or in part, by any court of competent }urisdiction, the remaining provisions and portions thereof and applications not declazed illegal, invalid, ar inoperative shall remain in force or effect. Sec. 98.07. WAIVER FOR CITY BUSINESS SUBSIDY. A. PRIOR TO EXECUTION OF CITY BUSINESS SUBSIDY AGREEMENT The requirements of this Ordinance may be waived in whole or in part by the City Council or HRA Board of Commissioners priar to the execution of a City Contract or City Business Subsidy agreement after a public hearing, consideration of both advantages and disadvantages of a waiver, and upon a finding of a compelling public purpose. B. AFTER EXECUTION OF CITY BUSINESS SUBSIDY AGREEMENT 282 Any City Business Subsidy Recipient who can demonstrate that it will suffer an economic 283 hardship due to the occurrence of significant unfareseen circumstances beyond the control of the 284 City Business Subsidy Recigient that have occurred subsequent to the City Business Subsidy 285 agreement may request a waiver from the requirements of this Act and such waiver may be given 286 by the City Council or HRA Board of Commissioners. 0 2g� 288 289 290 291 292 Section 2 0�-�07� This Ordinance adding Administrative Code Chapter 98 shall become effective thirty (30) days after passage, approval and publication as provided in the City Charter, Section 6.11. ; ':;� �'��=�-; � f � ��� ''�>'� e ����T Benanav Bosh Harris Adopted by Council: Date Yeas Adoption Certified by Council Secretary C/ By: � Approved by a Date 0 7 By: Requested by Department oE By: Form Approv b By: Form Approved by Mayar for Submission to Council � 06 -ia � l � Green Sheet Green Sheet Green Sheet Green Sheet Green Sheet Green Sheet � co -��il Contact Person 8 Phone: Councilmember Helgen 2G6-8650 Must Be on Council Agen� 22-NOV-O6 Doc.Type: ORDINANCE E-0ocumentRequired: Y DocumentContact: JenniferDunn Contact Phone: 266-8650 ,��� I Green Sheet NO: 3034613 � � Deoartment SentToPerson InitiallDate � 0 iConnN Assign I 1 ouncil �De artmentD'vec[or Number Z �h Clerk � For Routing 3 Order 4 � 5 Total # of Signature Pages _(Clip All Locations for AMion Requested: An ordinance adding Chapter 98 to the Saint Paul Administrative Code for the purpose of establishing Saint Paul's Living Wage Requirements. Recommendations: Appro�e (A) or Reject (R): Planning Commission C1B Committee Ciul Service Commission 1. Has this persoNfirtn ewr wodced under a corrtract for this department? Yes No 2. Has this personlfirtn e�er been a city employee? Yes No 3. Does this persoNfirm possess a skill rwt rwrmally possessed by any current ciry employee? Yes No Explain all yes answers on separete sheet and attach to green sheet Initiating Problem, Issues, Opportunity (Who, What, When, Where, Why): AdvanqgeslfApproved: Disadvantapes IfApproved: Disadvanta5les If Not Approved: loql Amount of Transaction: Funding Source: Financial Information: (Explain) CosURevenue Budgeted: Activiry Number: November 15, 2006 4: f 1 PM Paqe 1 Substitute — 12 Council File # 06-1071 Ordinance # 3034613 Green Sheet # ORDINANCE CITY OF SAINT PATL, MIlVNESOTA � J Presented By Referred To Committee Date : An ordinance adding Chapter 98 to the Saint Paul Administrative Code for the purpose of establishing Saint Paul's Living Wage Requirements THE COUNCIL OF THE CITY OF SAINT PAUL DOES ORDAIN Section 1 Chapter 98 of the Saint Paul Administrative Code is hereby amended to include the following new chapter: Chapter 98. Living Wage Sec. 98.01. SHORT TITLE. This Ordinance shall be called the "Saint Paul Living Wage and Responsible Public Spending Ordinance." Sec. 98.02. PURPOSE. Recognizing that the City awazds business subsidies and is a major contractor for services, the City enacts this Ordinance to promote the creation and retention of living wages and full time positions, and to increase the wages of service employees and employees whose employers are subsidized by the City or whose empioyer enters into a contract with the City in order to improve public health and welfare, promote the economic strength of the City, and reduce the pressure on governmental services and programs. Nothing in this Chapter shall abrogate or modify any rights or obligations specified in Chapter 85 of the Saint Paul Administrative Code. Sec. 98.03. DEFIlVITIONS. A. `Basic health insurance" means (1) an insurance or self-insured group health plan where an employer pays at least seventy-five (75) percent of the premium for individual coverage plus fifty (50) percent of the premium for family coverage; deductibles and out-of-pocket maYimums cannot be greater than those allowed by �to t0'"� 1 the Intemal Revenue Service for Health Reimbursement Arrangements and plan design must meet the miniinum requized by Health Reunbursement Arrangements and State L,aw (2) a deductible insurance plan offered by an employer where in- network deductibles do not exceed twenty-five (25) percent for office visits, inpatient caze, outpatient caze and/or urgent/emergency care, there is a one thousand five hundred dollazs ($1,500.00) out of pocket masimum for individual and three thousand doilazs ($3,000.00) out of pocket masimum for family, and any out-of-network deductible plan's out-of-pocket maximum does not exceed two thousand dollazs ($2,000.00) for individual and four thousand dollazs ($4,000.00) for family; or (3) an employer offers a health plan not less in value than that provided to first level supervisory employees provided that the benefit costs employers a minimum of seventy-five (75) percent of the difference between one hundred ten (110) percent and one hundred thirty (130) percent of the federal poverry level for a family of four (4). B. "City" means the City of Saint Paul and the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota. C. "City Contractor" means a for-profit or not-for-profit entity or person that is a party to a City Contract. D. "City ContracY' means a contract for services and any amendments thereto between the City and City Contractor not covered by Section 82.07 of the Administrative Code with the City valued in the aggregate at $100,000 or more. A City Contract does not include (a) a contract whereby the City Contractor manages City owned land and/or improvements on behalf of the City's parks department and the City Contractor pays a portion of the revenues to the City or (b) a contract whereby the City Contractor provides depository and/or financial services to the City, or (c) a contract whereby the City Contractor provides contract health care benefits to city employees. Nothing is this Chapter sha11 abrogate or modify any rights or obligations specified in Chapter 85 of the City's Administrative Code. E. "City Business Subsidy" means any of the following extended by the City to a recipient with a value of $100,000 or more: (a) a grant, (b) a contribution of personal property, (c) a contribution of real properry, (d) with respect to a loan given by the City, the present value of the difference in the interest rate given by the City and that rate commercially available to the recipient, (e) any reduction or deferral of any tax, assessment or fee, (fl any guarantee of any payment under any loan, lease, or other obligafion, (g) tas increment financing, (h) the issuance of revenue bonds, (i) tax credits, or (j) other City participation. Conduit bonds and infi•astructure are not a City Business Subsidy. F. "City Business Subsidy RecipienY' means a for-profit or not-for-profit entity that receives a City Business Subsidy. G. "City SubcontracY' means a contract for services between a City Contractor and City Subcontractor valued at $100,000 or more to perform a portion of the services described in a City Contract. H. "City Subcontractor" means a for-profit or not-for-profit entity or person that is a - 2 - party to a City Subcontract. C� lo't � I. "Job readiness and traiuiug services" means services whose purpose and intent is to help individuals establish a stable work history by addressing the social and economic barriers to employability, including trainiug, apprenticeship, and adequate day caze. "Sole source" means a source of products or services that is the only viable market option for the City. K. "TenanY' means the initial for-profit or not-for-profit entity or person that leases from a City Business Subsidy Recipient space in the specific location for wluch the City Business Subsidy was provided, or if there is more than one such initial enfity or person then it means the entity or person that leases the greatest amount of space and any entity or person that leases space of 15,000 or more square feet. L. "Tenant Subcontactor" means a person, other than an employee of a Tenant, who performs services at the specific location for which the City Business Subsidy was provided under a contract between that person or that person's employer and a Tenant. Sec. 98.04. . LIVING WAGE/JOB CREATION AND RETENTION A. PAYMENT OF LIVING WAGE Citv Contract; Citp Subcontract. Any City Contract, or City Subcontract must require City Contractors and City Subcontractors to pay an hourly wage that is at least the living wage for the duration of the contract to each employee who is working pursuant to the City Contract or City Subcontract or who is employed in the specific location for which the City Contract or City Subcontract is intended to benefit. 2. Citv Business Subsidy. Any City Business Subsidy Recipient and Tenant must agree to pay an hourly rate that is at least the living wage to each employee who is employed in the location for which the City Business Subsidy was provided and a Tenant must pay at least a living wage to each Tenant Subcontractor for the longer of the following. (a) the duration of the City Business Subsidy Agreement, or (b) three years. B. CALCULATION OF LIVING WAGE The living wage shall be a wage level equivalent to at least 130 percent of the federal poverly level for a family of four. For employers that provide employees basic health insurance, the living wage shall be a wage level equivalent to at least 110 percent of the federal poverry level for a family of four. The living wage shall be based on the then current federal poveriy level and shall be adjusted within one week after the federal government adjusts the rate. - 3 - federal poverty level for a family of four. The living wage shall be based on the then�� ` current federal poverty level and shall be adjusted within one week after the federal government adjusts the rate. C. JOB CREATION AND RETENTION A City Business Subsidy Recipient must enter into a City Business Subsidy agreement with the City that includes: (1) a description ofthe subsidy; (2) a statement of the public purpose for the subsidy; (3) goals for the number of jobs created and/or retained; and (4) wage goals for any jobs created and/or retained. D. APPROVAL OF CITY CONTRACT AND CITY BUSINESS SUBSIDY All City Contracts and City Business Subsidies must be approved by the Saint Paul City Council and/or the Board of Commissioners of the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota by a resolution approving a budget or the City Contract or City Business Subsidy. E. EXEMPTIONS 1. Entities. The following entities are exempt from the living wage requirement: a. any incorporated entity, organized for profit, that falls within the definition of a small business under Minnesota Statute 645.445; b. any 501 (c) entity which falls under the criteria laid out in Minnesota Statute 645.445, subdivision 2; c. a recipient of a City Contract, City Business Subsidy ar City Subcontract that contains an express provision that the purpose of the contract or subsidy is job readiness and training services and that the recipient is exempt from the living wage requirement; d. any recipient of a City Contract, City Business Subsidy or City Subcontract for whom the City Council determines that application of the living wage requirement would conflict with a state or federal law or program requirement; e. any recipient of a City Contract, City Business Subsidy or City Subcontract which is bound by a collective bargaining agreement for the period of the contract or the subsidy; f. any recipient that is an intermediary, such as a community development corporation, community investment group, or community bank, which serves as a pass-through agency for the granting of assistance; g. 501 (c) entities that are sole source providers of product or service. - 4 - 2. No City Contractor, City Subcontractor City Business Sub�y�ec pi�n" or Tenant shall dischazge, demote, harass, or otherwise take adverse action against any individual because such individual seeks enforcement of the living wage requirement or testifies, assists, or participates in any manner in an investigation, hearing, or other proceeding to enfarce this Ordinance. 3. No City Contractor, City Subcontractor City Business Subsidy Recipient or Tenant shall split or subdivide a contract or subsidy, pay an employee through a third pariy, or treat an employee as a subcontractor or independent contractor to avoid payment of a living wage. 4. This Ordinance sha11 be enforced by the Department of Planning and Economic Development, or its successor agency, with respect to a City Business Subsidy, which shall propose regulations far Council approval as aze necessary to implement and administer compliance with the City Business Subsidy. This Ordinance shall be enforced by the Office of Financial Services or its successor agency, with respect to a City Contract, which shall propose regulations for Council approval as aze necessaxy to unplement and administer compliance with the City Contract. Enforcement sha11 include but not be limited to receiving, investigating and attempring to resolve complaints by employees and Tenant Subcontractors. 5. Any recipient of a City Contract ar City Business Subsidy or City Subcontract or Tenant shall provide written notice to its employees that they may be covered by the terms of this Ordinance as specified in section 98.04 (A) and sha11 also provide its employees a written copy of this Ordinance. Sec. 98.05. APPLICATION. This Ordinance shall apply to any City Contract, City Subcontract or City Business Subsidy executed after the effective date of this Ordinance. Sec. 98.06 SEVERABILITY. If any provision or application of this Ordinance is declared illegal, invalid, or inoperative, in whole or in part, by any court of competent jurisdiction, the remaining provisions and portions thereof and applications not declared illegal, invalid, or inoperative sha11 remain in force or effect. Sec. 98.07. WAIVER FOR CITY BUSINESS SUBSIDY. A. PRIOR TO EXECUTION OF CITY BUSINESS SUBSIDY AGREEMENT The requirements of this Ordinance may be waived in whole or in part by the City Council or HRA Board of Coxnxnissioners prior to the execution of a City Contract or City Business Subsidy agreement after a public hearing, consideration of both advantages and disadvantages of a waiver, and upon a fmding of a compelling public purpose. B. AFTER EXECUTION OF CITY BUSINESS SUBSIDY AGREEMENT - 6 - Any City Business Subsidy Recipient who can demonstrate that it wili suffer an economic �� �� hazdslup due to the occurrence of significant unforeseen circusnstances beyond the control of the City Business Subsidy Recipient that have occurred subsequent to the City Business Subsidy agreement may request a waiver from the requirements of this Act and such waiver may be given by the City Council or I�RA Boazd of Commissioners. Secrion 2 This Ordinance adding Admiuistrative Code Chapter 98 shall become effecrive tliirty (30) days after passage, approval and publication as provided in the City Charter, Section 6.11. Adopted by AdoptionCc..._.__,,, _„_ ............... BY . Approved by Mayor: Date B Approved by Mayor for Submission to Council By . — 7 — CouncIl File # ��—/a�� 3034613 Green Sheet # CITY O SAIN,T UL, MINNESOTA �� � a 3 Presented By Referred To An ordinance adding Chapter 98 to the Saint Paul Administrative Code for the purpose of establishing Saint PauPs Living Wage Requirements THE COUNCIL OF THE CITY OF SAINT PAUL DOES ORDAIN Section 1 Chapter 98 of the Saint Paul Administrative Code is hereby amended to include the following new chapter: Chapter 98. Living Wage Sec. 98.01. SHORT TITLE. This Ordinance shall be called the "Saint Paul Living Wage and Responsible Public Spending Ordinance." Sec. 98.02. PURPOSE. Recognizing that the City awazds business subsidies and is a major contractor for services, the City enacts this Ordinance to promote the creation and retention of living wages and full time positions, and to increase the wages of service employees and employees whose employers are subsidized by the City or whose employer enters into a contract with the City in order to improve public health and welfare, promote the economic strength of the City, and reduce the pressure on governmental services and programs. Nothing in this Chapter shall abrogate or modify any rights or obligations specified in Chapter 85 of the Saint Paul Administrafive Code. Sec. 98.03. DEFIIVITIONS. A. "Basic health insurance" means (1) an insurance plan where an employer pays at least eighty (80) percent of the premium for individual coverage or the individual contribution plus fifiy (50) percent of the difFerence between the individual rate and the dependent care rate far family coverage; deductibles and out-of-pocket t�l�-�a 7/ maxunums cannot be greater than those allowed by the Internal Revenue Service for Health Reimbursement Arrangements and plan design must meet the iniuimum required by Health Reimbursement Arrangements and State Law (2) a deductible insurance plan offered by an employer where in-network deductibles do not exceed twenry-five (25) percent for office visits, inpatient caze, outpatient care and/or urgenUemergency caze, there is a one thousand five hundred dollazs ($1,500.00) out of pocket maximum for individual and three thousand dollazs ($3,000.00) out of pocket maximum for family, and any out-of-network deducrible plan's out-of-pocket ma�mum does not exceed two thousand dollazs ($2,000.00) for individual and four thousand dollars ($4,000.00) for family; or (3) an employer offers a health plan not less in value than that provided to first levei supervisory employees provided that the benefit costs employers a m;r,imum of seventy-five (75) percent of the difference between one hundred ten (i 10) percent and one hundred thirty (130) percent of the federal poverry levei for a family of four (4). B. "City" means the City of Saint Paul and the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota. C. "City Contractor" means a for-profit or not-for-profit entity or person that is a party to a City Contract. D. "City Contract° means a contract for services and any amendments thereto beriveen the City and City Contractor not covered by Section 82.07 of the Administrative Code with the City valued in the aggregate at $100,000 or more. A City Contract does not include (a) a contract whereby the City Contractor manages City owned land and/or unprovements on behalf of the City's parks department and the City Contractor pays a portion of the revenues to the City or (b) a contract whereby the City Contractor provides depository and/or financial services to the City, or (c) a contract whereby the City Contractor provides contract health caze benefits to city employees. Nothing is this Chapter sha11 abrogate or modify any rights or obligations specified in Chapter 85 of the City's Administrative Code. E. "City Business Subsidy" means any of the following extended by the City to a recipient with a value of $100,000 or more: (a) a grant, (b) a contribution of personal properry, (c) a contribution of real properry, (d) with respect to a loan given by the City, the present value of the difference in the interest rate given by the City and that rate commercially available to the recipient, (e) any reduction or defenal of any ta��, assessment or fee, ( fl any guarantee of any payment under any loan, lease, or other obligation, (g) tax increment financing, (h) the issuance of zevenue bonds, (i) tas credits, or (j) other City participation. Conduit bonds and infrastructure are not a City Business Subsidy. F. "City Business Subsidy RecipienY' means a for-profit or not-for-profit entity that receives a City Business Subsidy. G. "City SubcontracY' means a contract for services between a City Contractor and City Subcontractor valued at $100,000 or more to perform a portion of the services described in a City Contract. ocd-�c� H. "City Subcontractor" means a for-profit or not-for-profit entity or person that is a parry to a City Subcontract. I. "Job readiness and training services" means services whose purpose and intent is to help individuals with serious mental and physical barriers to employment establish a stable work history by addressing the social and econoxnic barriers to employability, inciuding iraiuiug, apprenticeship, and adequate day care. "Sole source" means a source of products or services that is the only viable market option for the City. K. "TenanY' means the initial for-profit or not-for-profit entity or person that leases from a City Business Subsidy Recipient space in the specific location for which the City Business Subsidy was provided, or if there is more than one such initial entity or person then it means the entity or person that leases the greatest amount of space and any entity or person that leases space of 25,000 or more square feet. L. "Tenant Subcontactor" means a person, other than an employee of a Tenant, who performs services at the specific location for which the City Business Subsidy was provided under a contract between that person or that person's employer and a Tenant. Sec. 98.04. . LIVING WAGE/JOB CREATION AND RETENTION A. PAXMENT OF LIVING WAGE Cit�Contract; Citv Subcontract. Any City Contract, or City Subcontract must require City Contractors and City Subcontractors to pay an hourly wage that is at least the living wage for the duration of the contract to each employee who is working pursuant to the City Contract or City Subcontract or who is employed in the specific locarion for which the City Contract or City Subcontract is intended to benefit. 2. Cit�Business Subsidv. Any Ciry Business Subsidy Recipient and Tenant must agree to pay an hourly rate that is at least the living wage to each employee who is employed in the location for which the City Business Subsidy was provided and a Tenant must pay at least a living wage to each Tenant Subcontractor for the longer of the following: (a) the dura6on of the City Business Subsidy Agreement, or (b) three years. B. CALCULATION OF LIVING WAGE The living wage sha11 be a wage level equivalent to at least 130 percent of the federal poverty level for a family of four. For employers that provide employees basic health insurance, the living wage shall be a wage level equivalent to at least 110 percent of the fedexal poverty level for a family of four. The living wage sha11 be based on the then current federal poverry level and shall be adjusted within one week after the federal government adjusts the rate. 16 - io7/ C. JOB CREATION AND RETENTION A City Business Subsidy Recipient must enter into a City Business Subsidy agreement with the City that includes: (1) a description of the subsidy; (2) a statement of the public purpose for the subsidy; (3) goais for the number of jobs created and/or retained; and (4) wage goals for any jobs created and/or retained. D. APPROVAL OF CITY CONTRACT AND CITY BUSINESS SUBSIDY All City Contracts and City Business Subsidies must be approved by the Saint Paul City Council and/or the Boazd of Comxnissioners of the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota by a resolution approving a budget or the City Contract or City Business Subsidy. E. EXEMPTIONS 1. Entities. The following entities aze exempt from the living wage requirement: a. any incorporated entity, organized for profit, that falls within the definition of a sma11 business under Minnesota Statute 645.445; b. any 501 (c) entity which fa11s under the criteria laid out in Minnesota Statute 645.445, subdivision 2; c. a recipient of a City Contract, City Business Subsidy or City Subcontract that contains an express provision that the purpose of the contract or subsidy is job readiness and training services and that the recipient is exempt from the living wage requirement; d. any recipient of a City Contract, City Business Subsidy or City Subcontract for whom the City Council deternunes that application of the living wage requirement would conflict with a state or federallaw or program requirement; e. any recipient of a City Contract, City Business Subsidy or City Subcontract which is bound by a collective bargauung agreement for the period of the contract or the subsidy; f. any recipient that is an intermediary, such as a community development corporation, community inveshnent group, or community bank, which serves as a pass-through agency far the granting of assistance; g. 501 (c) entities that are sole source providers of product or service. 2. Emplo�. b6-�o7/ a. A recipient of a City Contract, City Subcontract, or City Business Subsidy and a Tenant may request and obtain exemptions from the living wage requirements for the following types of employees: l. Temporary internships or similaz positions that aze intended to provide career exposure to new entrants to the workforce, lasting no mare than 12 consecutive months; 2. Individuals who aze placed with the employer as the result of a job readiness or job traiuiug program or who are participants in an employment program that provides work opportunities for those with serious mental and physical barriers to employment or similaz employer sponsored work opportunity program for individuals with serious mental and physical barriers to employment; 3. Seasonal, part-time or temporazy employees whose employment does not reduce or offset the work of permanent employees, on the conditions that (a) no more than ten percent (10%) of the contract amount is for the employment of such seasonal, part-tnne or temporary workers, and (b) that the City Contractor, City Subcontractor or City Business Subsidy Recipient is not intending to utilize such labor to avoid the requirements of this ordinance. F. ENFORCEMENT Any recipient of a City Contract or City Subcontract that fails to meet the living wage requirements of this Ordinance at any tnne during the duration of the contract, and any City Business Subsidy Recipient that fails to meet the living wage or wage goals and other requuements of tYus Ordinance at any time during the duration of the subsidy, shall (a) not be eligible for a City Business Subsidy or City Contract in the next contract cycle or the next calendar yeaz; and (b) shall repay to the city an amount determined as follows: the entire value of the contract or subsidy if compliance is less than 50% of the requirement, one-half of the value of the contract or subsidy if compliance is 50% or more but less than 80% of the requirement, and proportionate to the value of the contract or subsidy if compliance is 80% or more but less than 100% of the requirement. D� -/o � l 2. No City Contractor, City Subcontractor City Business Subsidy Recipient or Tenant shall dischazge, demote, harass, or otherwise take adverse acrion against any individual because such individual seeks enforcement of the living wage requirement or testifies, assists, or participates in any manner in an investigation, hearing, or other proceeding to enforce this Ordinance. 3. No CiTy Contractor, City Subcontractor City Business Subsidy Recipient or Tenant shall split or subdivide a contract or subsidy, pay an employee tUrough a third parry, or treat an employee as a subcontractor or independent contractor to avoid payment of a living wage. 4. This Ordinance shall be enforced by the Department of Plauning and Economic Development, or its successor agency, with respect to a City Business Subsidy, which shall propose regulations far Council approval as are necessary to implement and administer compliance with the City Business Subsidy. This Ordinance sha11 be enforced by the Office of Financial Services or its successor agency, with respect to a City Contract, which shall propose regulations for Council approval as aze necessary to unplement and administer compliance with the City Contract. Enforcement shall include but not be limited to receiving, investigating and aitempting to resolve complaints by employees and Tenant Subcontractors. Any recipient of a City Contract or City Business Subsidy or City Subcontract or Tenant shall provide written nofice to its employees that they may be covered by the terms of this Ordinance as specified in section 98.04 (A) and sha11 also provide its employees a written copy of this Ordinance. Sec. 98.05. APPLICATION. This Ordinance shall apply to any City Contract, City Subcontract or City Business Subsidy executed after the effective date of this Ordinance. E.`I���:�IZi.y �►�L : : : �I ffll_'� If any provision or application of this Ordinance is declared illegal, invalid, or inoperative, in whole or in part, by any court of competent jurisdiction, the remaining provisions and portions thereof and applications not declared illegal, invalid, or inoperative shall remain in force or effect. Sec. 98.07. WAIVER FOR CITY BUSINESS SUBSIDY. A. PRIOR TO EXECUTION OF CITY BUSIlVESS SUBSIDY AGREEMENT The requirements of this Ordinance may be waived in whole or in part by the City Councii or HRA Board of Coxnmissioners prior to the execution of a City Contract or City Business Subsidy agreement after a public hearing, consideration of both advantages and disadvantages of a waiver, and upon a finding of a compelling public purpose. B. AFTER EXECUTION OF CITY BUSINESS SUBSIDY AGREEMENT Any City Business Subsidy Recipient who can demonstrate that it will sufFer an economic a 6 � � D 7� hardship due to the occurrence of significant unforeseen circumstances beyond the control of the City Business Subsidy Recipient that have occurted subsequent to the City Business Subsidy agreement may request a waiver from the requirements of this Act and such waiver may be given by the City Council or HRA Board of Commissioners. Section 2 This Ordinance adding Administrative Code Chapter 98 shall become effective tivrty (30) days after passage, approval and publication as provided in the City Charter, Section 6.11. by Department of. Adopted by Council: Date Adoption Certified by Cou¢cil Secretary B Approved by Mayor: Date By: