What is initiative 101 and who is behind it?

Initiative 101 is an initiative proposed and funded by two of the nations wealthiest and
most politically active labor unions, the Service Employee International Union (SEIU) and
AFL-CIO. It is part of a broader national push to dramatically increase the minimum
wage. Their initiative would place a dramatic minimum wage hike in the Colorado
Constitution, increasing the minimum wage by 44% for most entry-level workers, and
70% for servers, bartenders and other tipped employees by 2020. Wages would
continue to rise through cost of living increases year over year.

How does Colorados current minimum wage stack-up

to the rest of the nation?
Colorado has raised its minimum wage in the last 10 years by more than almost any
other state, giving it one of the highest minimum wages in the country. In 2006,
Colorado voters approved an immediate minimum wage increase and a permanent
requirement that the minimum wage increase by ination every year thereafter. The
2006 minimum wage boost has increased the minimum wage by more than 61% in the
10 years since, making it one of the highest and one of the few that escalates
automatically every year.

How much would initiative 101 increase the minimum

wage over-and-above the 2006 law?
Dramatically nearly 50%. Initiative 101 would increase the minimum wage by an
additional 44% over the next four years, on top of the 61% increase that has occurred in
the last 10 years. The increase is even more dramatic for tipped employees raising the
minimum wage by 70% for those employees.

Proposed minimum wage increases in other states give

flexibility, for example, to small businesses in rural
areas where the cost of living and cost of doing
business is much different than a larger business in a
large urban and suburban area. Does Initiative 101 give

any flexibility for rural areas or small businesses?

No. One of the most draconian aspects of Initiative 101 is that it would make a small
business in the San Luis Valley, the Western Slope or the Eastern Plains pay the same
wage structure to new workers as it would for large and cash-rich businesses in
communities like Boulder, Aspen, Cherry Hills and the high-end Denver suburbs. The
National Federation of Independent Business says Initiative 101 will have a
disproportionate impact on small, rural and family-owned businesses because they
typically operate on smaller prot margins and do not have the capacity to absorb a
44% 70% increase in the minimum wage like larger businesses with larger prots.

If this initiative passes, next year cant we correct the

correct the cost of living disparity that hurts rural
communities relative to larger, higher-income
communities?
No. Because Initiative 101 is a constitutional amendment, if passed, it cannot be
changed by the legislature. Theoretically, voters could approve another constitutional
amendment amending this constitutional amendment, but that hasnt happened in
Colorado since Prohibition.

If this initiative passes, cant we correct the

tipped-wage issue at the legislature?
No. Because Initiative 101 is a constitutional amendment, if passed, it cannot be
changed without a vote of the people.

How would the initiative impact restaurants and other

businesses whose employees earn a significant share of
their pay from tips?
Restaurants especially small, family-owned operations in rural areas will feel the
brunt of Initiative 101 more directly than any sector. The minimum wage for tipped
employees, like servers or bartenders, will increase by 70% under Initiative 101. This
increase is larger than the 44% increase for non-tipped employees because the tip
credit of $3.02 or the amount less from the current minimum wage that tipped
employees can be paid will not change.

Is there room for a compromise?

The Colorado Restaurant Association met with proponents prior to the ballot language

deadline in March and asked if they would consider a compromise, even if only on the
tipped wage. Their response was no. In fact, the proponents stated that they would
prefer the minimum wage to be $15 per hour and eliminate the tip credit altogether.
All state deadlines have passed to introduce alternative ballot language for this election.

Have there been studies done on the impact of such a

large minimum wage hike?
Yes, multiple studies both locally and nationally have demonstrated signicant negative
economic impacts by such a large increase. A recent independent study found that
Initiative 101 would reduce Colorado employment by 90,000 jobs by 2022 and depress
wages in the state by $3.9 billion annually. It would have an even more outsized impact
on teenage employment, reducing it by 10,500 jobs by 2022, depriving many young
Coloradans of early job opportunities and the ability to save for college. Nationally, the
non-partisan Congressional Budget Oce found a smaller increase in the federal
minimum wage to $10.10 per hour would have the eect of killing 500,000 jobs
across the country.

I pay my employees more than the minimum wage

currently. How will this measure affect my business?
The job losses incurred as a result of Initiative 101 will have wide-ranging impacts
across the economy, in addition to the $3.9 billion in reduced wages felt by Colorado
consumers. Many businesses will be forced to raise prices to cover their increased labor
costs costs that will be borne by many businesses who currently pay more than the
minimum wage. Additionally, with entry-level workers making $12/hour there will be
pressure to raise wages for all employees, causing increased labor costs for many
businesses that currently pay more than the minimum wage.

What has happened in other states where this has been

proposed and is there a real shot at beating it?
Minimum wage increases passed at the ballot box in four states in 2014, but all were for
much smaller increases than the one proposed by Initiative 101. Initial research shows
that Colorado voters have signicant concerns about the measure and that it remains
eminently beatable. In 2006, the last time a minimum wage measure was on the ballot
in Colorado it barely passed, 53% - 47%. However, this year the choice before voters is
much dierent than 2006. Rather than deciding between keeping the minimum wage

stagnant and increasing it, voters will decide between the current annual increase and
raising the minimum wage to the point where signicant job losses are suered as a
result.

Who is for and who is against Initiative 101?

The proponents and funders of the measure are largely national labor unions and
liberal special interest groups who are targeting Colorados ballot as part of a broader
national political eort. Opponents include the Colorado Association of Commerce and
Industry, the National Federation of Independent Businesses, the Colorado Restaurant
Association, the Tavern League and a growing list of small and family-owned businesses
that would feel the brunt of the negative consequences of such a large increase in such
a short time.