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LivingWages & Communities: Smarter Economic Development. LvwerThan Expected Costs Firms Targeted by Economic Development Agencies Already Paid Higher Wages Several administrators commented that because their business subsidy programs already aimed to recruit firms paying better than average wages, the living wage law did not change their way of oper- ating but rather formalized a pre-existing policy preference. As a consequence, only two cities identi- fied businesses that they sought to recruit with taxpayer subsidies where the employer had to raise some workers' pay in order to meet the living wage standard: • Duluth reported that in 2000, a health maintenance organization recruited with a public subsidy package raised wages for 9 5 workers in order to meet the ciry's living wage standard. " • Toledo reported that in 2000, a telephone answering company seeking a public subsidy raised pay for 25 employees in order to meet the ciry's living wage �i r.i71i �i ti .�' • However, Minneapolis, Warren, 1'psi�aEiti and Ypsilanti Township reported that all jobs at busi- nesses targeted by their economic development programs —chiefly fiims in the industrial and technology sectors—alreadypaid a living wage and thus no wage adjustments were required by firms recruited with subsidy awards." For the majoriry of the localities, living wage laws did not require changes in the operation of their business subsidy programs because the programs already targeted for recruitment firms that paid living wages. Living Wage Laws Increased Public Confidence in Business Subsidy Programs Some cities indicated that their living wage policies actually boosted public acceptance of local business subsidy programs. They found that residents who questioned the value of providing taxpayer subsidies to business were less hostile to an economic development program that guarantees that the jobs creat- ed pay at least a livin� wage. According to a San Antonio economic dEVelopment agent, the �iving wage law has "helped eliminate the controversy associated with [the economic development] program [because] ... groups hostile to incentives in the past aren't as hostile with the living wage component."" A I,os Angeles administrator who negotiated with the developer of the Staples Stadium development project echoed this sentiment by noting that project's acceptance of the living A wage requirement "aided the developer in getting communiry <�:��nn."' In fact, according t� a San Antonio Living Wage Laws Helped Focus Business Subsidy Programs Administrators report that livin� wage laws can help focus business subsidy programs by prioritizing high-wage job creation. For example, the economic development director of Duluth recounted that in the 197Q's, when Duluth had one of the highest unem- ployment rates in the country, the ciry used tax dollars to attract any jobs it could, regardless of the wage level. However, with a more moderate unem- economic development agent, the living wage [aw has "helped eliminate the controversy associated with [the economic development] program [because] . . groups hostile to incentives in th� past aren't as hostile �+ric� t�e living wage component:' � I�