ITEM 3.5: CITY LIVING WAGE
POLICY 3-3
Revisions to Council Policy 3-3, Relating to Living Wage Setting the Methodology of Annual Rate Adjustments
Matt Loesch, Director of Public Works
Background
• 1998 - City’s Living Wage was established
• 1999-2013 - Multiple revisions providing
clarification of intent and application,
liquidated damages, and Labor Peace
• 2008 - City Council adopted Airport Living
Wage Ordinance (ALWO)
• 2010 - ALWO amended wage adjustment
methodology to utilize Consumer Price
Index
2 Current
City Living Wage
Annual
Adjustment
Methodology
• Annual adjustment methodology requires
changes in:
• Historically the Geographic Accessor Factor
requires use of private, third-party data
• Discrepancies and inconsistencies when
compared to City Departments data
Federal Poverty Income + Geographic Accessor = San Jose Living Wage Rate Standard for Family of 3 Factor
3 Analysis
California Living
Wage/ Minimum
Compensation
Policies
• Approximately 21 cities and counties
in California have living wage or
minimum compensation policies
• City of San José is the highest at
$26.73, Ventura lowest at $15.43 hour
• All cities and counties, including City’s
ALWO, annual adjustment based on
Consumer Price Index
4 Consumer Price
Index
CPI-U / CPI-W
CPI- U (Local Geographic)
• Introduced 1978
• Covers 93% of U.S Population (professionals, self-employed, retirees, urban wage earners)
• Most commonly cited inflation measure
• Broader, more representative measure of inflation
• Airport Living Wage Ordinance
CPI-W (National Only)
• Introduced 1919
• Covers 29% of population (households with 50% income from clerical or wage jobs or one household member employed 37+ weeks annually
• More focused on working-class households, more weigh on transportation, food, and housing
• Used for Social Security COLA
5 Recommendation
Adopt a resolution approving revisions to City
Council Policy 3-3 and repealing Resolution
No. 76911 setting the methodology for
annual adjustments for the City’s Living
Wage rate to align with the City’s Airport
Living Wage rate methodology for the City’s
new Living Wage rate, effective July 1, 2026.
6 Matt Loesch, Director of Public Works
Q & A
7