Living Wages at the Airport and Port of San Francisco

The Benefits and the Costs

Purpose of this report

San Francisco’s proposed living wage ordinance would require covered employers to pay their workers a minimum of $11 per hour plus health benefits or a cash equivalent. The covered employers are basically those who have more than five employees and who either have contracts with the city or lease property from the city.

This report constitutes the second of two installments of a comprehensive analysis of the proposed ordinance. The first part, released in June 1999 (and available on the web at discussed the needs of San Francisco’s workers and examined the costs and benefits of raising pay for employees of service contractors and home care workers. This second part discusses the costs and benefits of raising pay for employees of property contractors.

Most Living Wage ordinances that are in effect in the U.S. cover only employees who work for municipal service contractors. San Francisco’s ordinance is more expansive in that it would also cover employees of private employers who are located on cityowned property. These employers are themselves tenants who have a rent or lease contract with the city or are subcontractors of such tenants. City agencies refer to these contracts as property contracts, as opposed to the service contracts that we analyzed in our first report.

The main purpose of this report is to estimate the costs and benefits of the proposed Living Wage Ordinance to the tenants of the City of San Francisco. Almost all the workers who are covered by the property contract sections of the living wage ordinance are employed at two sites: San Francisco International Airport and Port of San Francisco. For this reason we focus our analysis entirely on these two properties.

San Francisco is only the second city, after Los Angeles’ additions in 1998, to include property contracts in a living wage ordinance. The San Francisco ordinance calls for workers to be paid a minimum of $11 per hour, plus health benefits or a cash equivalent. The present report is the first comprehensive study of living wage impacts on a municipality’s property contracts