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What should Indiana's minimum wage be? 3 proposals would change Hoosier incomes

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Posted at 5:32 PM, Jan 04, 2019
and last updated 2019-01-04 18:59:39-05

INDIANAPOLIS — There were not one, not two, but three bills introduced in the Indiana Senate this week that would raise the minimum wage in Indiana.

Democratic Senators Karen Tallian, Eddie Melton and Frank Mrvan have all submitted bills that would raise the minimum wage from the current $7.25 per hour.

Melton’s proposal is initially the most modest of the three. It would increase the minimum wage to $9 per hour after Dec. 31, 2019, then another $0.50 per year until it hits $12 per hour in 2026.

Tallian’s proposal would increase the minimum wage to $11.12 per hour, but it would kick in this July, if passed.

Mrvan’s proposal is the most drastic, with an increase to $15 per hour as soon as July 2020. The minimum wage would then increase annually based on the increases by the Consumer Price Index for the preceding year.

If the growth for the CPI follows the same trend as the last decade, the minimum wage would increase by another 1.7 percent each year.

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The above graphic shows what Indiana's projected minimum wage would be under the three different proposals, and if none of them were adopted. RTV6 Graphic | Matt McKinney

Tallian’s proposal would also eliminate the tip credit for employers to determine minimum wage to a tipped employee. Melton and Mrvan both keep the tip credit in their bills.

“Hoosiers deserve a living wage to afford their rent, put food on the table and take care of their children,” Tallian said. “Over 600,000 Hoosiers would immediately feel the positive effect of an increase in the minimum wage. That is why I’m filing this bill, to support Hoosier workers and their families. If raising the state minimum wage to a living wage will help our families thrive, then I believe it’s an easy decision for the legislature to make this session.”

Elysia Smith, the owner of Irvington Vinyl & Books, said she would support a higher minimum wage, even to $15 per hour.

She said she would likely have to become more involved in the day-to-day operations of the store but feels it would be worth it.

“I think it’s really important to pay employees a living wage,” Smith said. “As a business owner, you get what you give.”

Smith said she already pays her employees at least $10 per hour, and has done so since she took over the store in June.

A living wage is the rate a person must earn to completely support their family.

According to an MIT study, a single parent with one child must earn $22.66 per hour for a living wage in Indiana. A living wage for one adult is $10.70 per hour. The poverty wage for one adult is $5.80.

The Indianapolis Chamber of Commerce doesn’t support a higher minimum wage in Indiana, Chief Policy Officer Mark Fisher said in a statement.

“We’re cautious about mandates that might discourage small businesses from hiring,” Fisher said. “We’re more interested in pursuing solutions — like our free business coaching and microlending programs — and strong economic development programs that create more high-paying jobs and help more homegrown employers hire more Hoosiers at better wages.”

Despite the discussion, the likelihood of any of the three bills becoming law is low, with a Republican supermajority in both chambers.

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