LA passed a $30 minimum wage ahead of the Olympics. Now special interests plan to take their cases to voters

When the Los Angeles City Council passed an ordinance earlier this year creating a $30 minimum hourly wage for hotel and airport workers by 2028, the long-debated move seemed like a done deal.

Instead, it kicked off a series of competing ballot propositions that city officials are warning could derail city finances and plans for the upcoming Olympic Games.

It started when a business group backed by Delta and United Airlines launched a referendum to repeal the wage increase, gathering tens of thousands of signatures that are currently being verified. In the meantime, the wage increase has not gone into effect.

The hotel workers union Unite Here Local 11 responded with its own raft of proposals, including raising the minimum wage citywide and requiring Angelenos to vote on building new hotels and event center developments.

Now, a coalition of business interests has upped the ante, filing a ballot proposition to repeal the city business tax, which brings in hundreds of millions of dollars to a city already in fiscal crisis.

The ballot propositions still have a number of steps to go through before actually reaching voters. In the meantime, City Councilmember Tim McOsker said his colleagues and Mayor Karen Bass need to intervene to find a resolution.

"We have very significant interest groups with political power in the city of Los Angeles who are choosing to go to the ballot box, and they are playing a game of brinksmanship," he said. " Everybody just needs to put their weapons down."

How could these ballot propositions affect the city?

The ballot propositions put forward by union and business groups in recent months could upend and delay L.A. at an exceedingly precarious time.

The city is juggling a budget crisis, recovery from January's wildfires and the ongoing presence of masked immigration agents on its streets. Now, the Olympics is less than three years away, and L.A. will be on the hook if the Games go over budget.

The Los Angeles Cost of Living Relief Initiative — the proposition introduced by business groups to repeal the city business tax — would eliminate a gross receipt tax that brought in more than $700 million last year. Bass said that if passed, it would lead to cuts to city services.

"Ironically, these cuts would impact several specific areas that impact businesses throughout the city," she said in a statement.

The L.A. Area Chamber of Commerce, which is supporting the proposition, told LAist it was partly in response to the City Council boosting the minimum wage for tourism workers.

"Our decision to support repeal at this moment has everything to do with the breakdown between City Hall and the business community," a Chamber of Commerce representative said in a statement.

City officials have also criticized the ballot proposition from Unite Here requiring Angelenos to vote on new hotel and event infrastructure. It claims that voter approval for such projects is necessary because "stadium development projects in other cities have rarely benefited those cities to the extent promised by developers."

Paul Krekorian, who is overseeing Olympic Games planning for the city, said that if the referendum were to pass, it would require expensive special elections to get small projects off the ground.

"The proposed measure would make vital projects essential for our city and these Games potentially impossible to complete," he said in a statement.

What do the players behind the propositions say?

It's unclear whether a compromise can be brokered outside of the ballot box.

Kurt Petersen, co-president of Unite Here Local 11, told LAist he doesn't think a deal with the business community is possible. He said the union turned to ballot propositions partly in response to the prolonged battle at City Hall to pass a higher minimum wage for tourism workers.

" We compromised a lot in that legislation many, many times," he said. "And then we got to the end and we thought we had a deal, and then the industry betrayed us and the city by trying to put that initiative on a referendum."

Rosanna Maietta, CEO of the American Hotel & Lodging Association, which is backing that referendum, told LAist that hotels are facing a number of economic challenges, including reduced tourism, and that $30 an hour by 2028 was "too high, too fast."

"The business community has felt largely ignored by the City Council," she said.

Councilmember Hugo Soto-Martínez, who voted for the ordinance and used to work as a Unite Here organizer, disagreed.

"I think what they're really saying is, 'We didn't get what we wanted,'" he said. "And that is true, you know. They didn't get what they wanted."

Councilmember Monica Rodriguez was one of three council members who voted against raising the minimum wage for tourism workers.

" We've seen an absence of balanced policymaking," she told LAist. " So now we see this War of the Roses."

A familiar but confusing strategy

Ballot propositions have a long and colorful history in California, and this isn't the first time they've become the forum for a policy showdown.

Mindy Romero, who directs the Center for Inclusive Democracy at USC, said that state propositions have been used as leverage to force legislative discussions, and that appeared to be what's happening in Los Angeles.

" When you have that many ballot issues with so many kind of clustered around a similar topic...the voter confusion level could be high," she said. "I would imagine that probably we're gonna see a lot of conversations and maybe some deals made."

Mark Baldassare with the Public Policy Institute of California said voters like to weigh in directly on issues through ballot propositions, but when they're confronted with competing or overwhelming proposals, they tend to vote no.

" They want to feel like they're making a decision in which there's been some discussions and there's some consensus ideally," he said. "And in the real world, it doesn't always happen that way."