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Wednesday, June 1, 2005

Firms Seek Revision In Living Wage

By Laura Banish
Journal Staff Writer
    Hundreds of people in Santa Fe County could lose their home health care services because of the city of Santa Fe's "living wage" ordinance, according to two local home health care providers who are asking the city for an exemption to the city-mandated minimum wage.
    Businesses with 25 or more employees must pay workers at least $8.50 per hour. The only exemption is nonprofit organizations whose primary source of funds comes from Medicaid waivers.
    The two home health care providers, which are for-profit businesses, would like to see the word "nonprofit" struck from the ordinance so the exemption includes all businesses that receive their primary source of funds from Medicaid. The two companies say for-profit providers account for 90 percent of home health care services in Santa Fe County.
    Representatives from Heritage Home Healthcare and Professional Home Health Care said they are losing between 7 cents and 39 cents per hour at the living wage hourly rate of $8.50 and will lose between $1.43 and $1.69 per hour once the living wage rate rises to $9.50 per hour in January 2006.
    Heritage Home Healthcare president Lee Trainor told the city Finance Committee on Tuesday that he is ready to tell the state in August that his company will no longer be able to provide home health care services such as bathing and food preparation to roughly 200 patients if the exemption is not approved.
    "We've been busting our butts to keep these patients cared for so they can continue living in their homes, but we just can't continue to do it if something doesn't give," Trainor said later.
    Professional Home Health Care director of operations Kevin Enslin said his company would also have to discontinue home care services to a similar number of people. His company anticipates losing $67,600 per month once the living wage increases in 2006.
    The Finance Committee postponed making a recommendation on the proposed amendment, which was brought forward by Councilor David Pfeffer, until the next meeting. The issue is slated for a public hearing at the July 13 City Council meeting.
    In other city finance news, the gross receipts tax shortfall caused by a change in state law is not bouncing back as city officials had hoped, finance director Kathryn Raveling said. The city saw a 14.6 percent drop in gross receipts tax collections in March from January sales because of inaccurate reporting after the tax was removed from foods and some medical payments.
    The good news, according to Raveling, is that after some back payments were collected, the 14.6 percent deficit was improved to a 10 percent deficit. The bad news is that April returns for the month of February showed a 0.87 percent decrease instead of the 0.21 percent increase originally calculated, and May returns for the month of March showed an increase of 1.17 percent as opposed to the 4.79 percent that was expected.
    Despite the shortfalls, the city looks like it will meet its 2004/2005 budget, she said, which was based on an average gross receipts collection of 2.5 percent. Currently, the city is averaging 3.055 percent for the fiscal year with two months left.
    The Finance Committee also recommended denial of a proposal to re-examine the city's policy on short-term rentals. City law says homes in residential neighborhoods cannot be rented for fewer than 30 days, but the law is widely violated, and enforcement is done on a complaint basis.