Initiative 77

Initiative 77 was a Washington, D.C. voter-approved ballot initiative to phase out the minimum wage exemption for tipped employees.  On June 19, 2018, the measure was passed by a more than 10% margin.  In October 2018, the initiative was repealed by the Council of the District of Columbia before it was enacted. 

Background
In June 2016, the Council of the District of Columbia voted to raise the standard minimum wage to $15 per hour and the tipped minimum wage to $5 per hour by 2020.  As of 2018, the minimum wage for the so-called tipped professions is $3.33 per hour, and $12.50 for everyone else in Washington, D.C. Implementation of Initiative 77 would gradually phase out a lower wage rate earned by bartenders, nail stylists, barbers, bellhops, delivery drivers, restaurant wait staff, and other tipped workers until it equals the regular minimum wage in 2026. 

Support and opposition
The Restaurant Opportunities Center United, a New York-based nonprofit group, led the effort to remove the exemption.  The National Restaurant Association and others bankrolled a "Save Our Tips" campaign to keep the existing exemption. 

The Washington Post, Mayor Muriel Bowser, many restaurant owners, and a majority of the Council opposed the initiative. 

Vote
On June 19, 2018, in a primary election, the voters of D.C. approved the measure with about 55% of the vote. 

Implementation
Following the passing of the initiative, it went to the United States Congress for a 30-day review.  Some members of the D.C. council opposed the measure and suggested overturning the initiative altogether. 

Implementation of the initiative would bring the District of Columbia to the same standard set by California, Oregon, Washington, Alaska, Nevada, Montana, and Minnesota, which do not have a separate tipped minimum wage. 

Repeal 
On July 10, 2018, seven members of the 13-member D.C. City Council introduced a bill designed to repeal Initiative 77 titled “Tipped Wage Workers Fairness Amendment Act of 2018.":  Jack Evans (D-Ward 2);
Brandon Todd (D-Ward 4); Kenyan McDuffie (D-Ward 5); Vincent Gray (D-Ward 7); Trayon White (D-Ward 8); Anita Bonds (D-At Large).  Council members Mary M. Cheh (D-Ward 3) and Elissa Silverman (I-At Large) oppose the bill, and Brianne K. Nadeau (D-Ward 1) said she was leaning against it.  If adopted, the bill would overturn the scheduled wage increases for tipped employees under Initiative 77.  Proponents of the initiative pointed out that the Initiative received more popular support than all of the Councilmembers who faced re-election. 

In a report by the consumer advocacy group Public Citizen, it was found that D.C. politicians who received more campaign donations from the restaurant industry were also the ones more likely to oppose Initiative 77 and to support repeal.  Mayor Muriel Bowser accepted over $65,000, Jack Evans received $44,920, and Councilmembers Vincent Gray, Phil Mendelson, Kenyan McDuffie, and Brandon Todd all took thousands of dollars in campaign contributions from Initiative 77 opponents.  Mary Cheh, the only D.C. Councilmember to support Initiative 77 before the vote, received $1,000 and she was also the only council member to propose an alternative to repeal. 

Council member Mary Cheh proposed a compromise to phase in the wage increase over 15 years instead of eight, giving businesses more time both to adjust and to intervene, if needed.  Restaurant Opportunities Centers United has endorsed Cheh's compromise; however, Restaurant Association of Metropolitan Washington seeks full repeal and no compromise. 

On September 17, 2018, the D.C. council held hearings about the initiative. 

On October 16, 2018, the council approved, with an 8 to 5 vote, permanent legislation to repeal and replace the initiative with the "Tipped Wage Workers Fairness Amendment Act".  Earlier, the council had approved 90-day emergency legislation overriding the initiative on October 2, 2018.  The repeal resets the 2018 D.C. minimum wage for all tipped employees back to $3.89 per hour, and it includes provisions to address wage theft and sexual harassment in the restaurant industry.  The repeal went into effect on December 13, 2018. 

U.S. Congressional action 
On July 11, 2018, congressman Mark Meadows (R-N.C.) and Gary Palmer (R-Ala.), members of the Republican Freedom Caucus, introduced an amendment to the U.S. government spending bill for 2019 to overturn Initiative 77.  Congress has the ability to pass bills that oppose local citizen initiatives or block their funding, but only in Washington, DC.  Several D.C. Council members spoke out against the Congress amendment, including several of those supporting the repeal effort.  In a written statement, Del. Eleanor Holmes Norton, the District's nonvoting representative in Congress said “Representatives Meadows and Palmer are up to their old tricks again by abusing congressional authority over the District to try to undemocratically impose their views on our residents.  Initiative 77 on tipped wages is a local issue that should be decided solely by D.C.”

Appeal 
An attempt to revive the initiative is being litigated in the courts. 

See also 
 Minimum wage in the United States
 Tipped minimum wage
 Initiatives and referendums in the District of Columbia

References 

Category:2018 in Washington, D.C.
Category:Politics of Washington, D.C.
Category:2018 ballot measures