This column originally appeared in Business Life.
Time and time again, California lawmakers pass legislation with complete disregard of the unintended consequences for local businesses and residents. A recent case perfectly demonstrates the problems created as a result.
In California, local service providers are contracted with the state to provide services to individuals with developmental disabilities. These are critical services for people who need support to live full and independent lives. Last year, the bill which raised California’s minimum wage included a provision to adjust reimbursement rates for these service providers to meet the increased state minimum wage.
But local elected officials made no provision to adjust rates based on increased local wage ordinances.
Assembly Bill 279 by Assemblymember Chris Holden will help local service providers cover their costs until the state minimum wage catches up with local minimum wages, when reimbursement rates will be adjusted under state law. Without AB 279, service providers are at risk of closure. The bill is critical to our neighbors with developmental disabilities, and VICA wholeheartedly supports the bill.
But we’re also frustrated with our elected officials who create these problems in the first place, and then expect someone else to pick up the pieces. AB 279 is an attempt to clean up the mess local elected officials created, and we’re going to pay for it with our tax dollars.
Without cleaning up this mess, service providers will have to shut their doors, leading to a shortage of services available to people with disabilities in the state. That means people with developmental disabilities – adults and children who are among the most vulnerable in our state – will pay the price.
The headaches created by these ill-considered actions must be dealt with by someone. This time, service providers for people with developmental disabilities have been left to pick up the pieces. Clearly that is unacceptable, and it’s become a problem state legislators are trying to fix.
The headache usually falls on our local business owners, who are left scrambling to cover increased costs. Lawmakers blithely fail to consider where business owners may recoup their costs. But business owners, in contrast to local service providers, can raise their prices. They can leave the state. They can lay people off or reduce hours. None of these are positive for Los Angeles or California, but they help keep the business viable. The non-profits helping people with disabilities can’t do any of these things. All they can do is keep hanging on until finally they are forced to shut their doors.
The case of the local increase in minimum wage is one example of legislators and local elected officials failing to consider the impacts of their actions, or just not caring. Legislators must realize the immense consequences that the laws they make have on the people that elected them. Failing to fully evaluate all of the implications is irresponsible.
AB 279 is critical in relieving the hardship experienced by those who need developmental services, and we urge lawmakers to support it. But we should also use this experience as a cautionary tale of what happens when our leaders don’t consider the consequences of their actions.