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Deal is set on minimum wage hike

State accord would raise rate to $8 in '08

The state minimum wage would increase to $8 an hour over the next two years under a deal reached yesterday by legislative negotiators that would provide raises to more than 300,000 workers and would probably give Massachusetts the highest rate in the country in 2008.

The measure would increase the current $6.75 an hour minimum wage by 75 cents on Jan. 1, 2007, and then by 50 cents more the following year. At $8 an hour, the state minimum wage would become the highest in the country, slightly higher than the wage in the states of Washington and Oregon.

The Senate quickly approved the measure yesterday, and it is likely to pass the House next week.

The measure does not trigger future increases by tying, or indexing, the wage to inflation.

Governor Mitt Romney supported linking the minimum wage to inflation during his 2002 campaign for governor, and his spokesman refused yesterday to endorse the current bill. Now weighing a run for president, Romney may face pressure to veto the wage increase to play to probusiness Republicans.

The Legislature, which is controlled by Democrats, would need a two-thirds' majority vote to override a veto .

``The governor supported indexing the minimum wage to inflation, and this bill rejects indexing, and so we will have to look carefully at what sort of increase the Legislature is proposing," Eric Fehrnstrom, Romney's spokesman, said in an e-mail.

The Legislature last voted to raise the minimum wage in 1999, in two steps, from $5.25 to $6 beginning in 2000 and from $6 to $6.75 in 2001.

The measure that emerged yesterday is a compromise. Earlier this year, Senate lawmakers filed legislation that would have increased the minimum wage to $8.25 an hour and would have tied future increases to the cost of living. House lawmakers supported a smaller increase, to $8 an hour over three years, and rejected the push to tie increases to the cost of living.

Jon Hurst -- president of the Retailers Association of Massachusetts, has contended that any minimum wage increases with ties to the cost of living would hurt competition for small businesses, but yesterday he said that this bill was an improvement.

``Certainly the final bill turned out better than earlier versions," he said. ``It gives small businesses a little more lead time and preparation time."

Senator Marc R. Pacheco, Democrat of Taunton and the chief sponsor of the Senate's version, said that he wanted to see the minimum wage tied to inflation, but that delaying the action further would be unfair to workers.

``This is an economic justice issue," Pacheco said. ``To not do this would be a tragedy for so many of these families out there."

The compromise was a fair adjustment, he said, but if the measure passes, lawmakers would need to revisit the issue in 2009.

``Is it perfect? No," he said. ``But at the end of the day, what we're really trying to do is give a wage increase to the lowest-paid workers. These people have been out there for five years without a raise."

State Representative George Peterson Jr., Republican of Grafton whose objection during yesterday's informal session delayed the bill's advancement, said he and other members had preferred a more gradual increase.

``We were willing to go for 50 cents the first year and 75 cents the second year," he said. ``I know it's the same amount of money, but until I talk to [ other House lawmakers] , I didn't feel comfortable letting it go through during an informal session."

On Wednesday, Romney declined to comment on the minimum wage legislation lawmakers were negotiating. He mentioned comments from his 2002 gubernatorial campaign. In July 2002, he was quoted as saying, ``I do not believe that indexing the minimum wage will cost us jobs. I believe it will help us to retain jobs."

Lieutenant Governor Kerry Healey, the Republican nominee for governor, was Romney's running mate in 2002. But yesterday she said that she opposed tying the wage to the cost of living.

``I do not like the idea of indexing," she told the Associated Press. ``I think that that creates a very unpredictable business environment, and it would be particularly detrimental to small businesses."

Eighteen states and the District of Columbia currently have minimum wages that are higher than the $5.15 an hour federal minimum wage, with Washington state the highest at $7.63 and Oregon next at $7.50. Four states -- Washington, Oregon, Florida, and Vermont -- index their minimum wage to the cost of living.

The Legislature's proposal would help about 315,000 low-wage workers in the state, according to the Massachusetts Budget and Policy Center.

Supporters say the increase would benefit the workers and the state, because the money that low-wage workers use to buy common necessities such as food, clothing, and rent would be recycled into the state's economy.

``This is a victory for low-wage workers," said Carl Nilsson, a spokesman for Neighbor to Neighbor, a group that organizes low-income families. ``We're giving a $2,500 raise to hundreds of thousands of low-wage workers."

Last month, Robert J. Haynes, president of the Massachusetts AFL-CIO, threatened to postpone endorsements of legislators unless they passed an amendment that would increase the minimum wage to $8.25 with future increases tied to changes in the cost of living.

Yesterday Haynes said he was ``thrilled with the House and Senate leadership" for moving forward with the bill, even without the indexing provision, but called the House objection ``a stall tactic and political shenanigans at its worst."

Russell Nichols can be reached at rnichols@globe.com.

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