The debates have begun about whether higher wage guarantees for some of America's most vulnerable and most effected by the pandemic should be part of the government's recovery.  When I write it like that, it seems obvious that a higher min. wage and an elimination of the tipped min. wage ($2.13/hr in TX), need to be included in the US response to this crisis.  It won't happen overnight but it will show that we are committed to putting our hourly workers on a better foundation for the next crisis.  Extending paid sick leave benefits will further ensure that hospitality employees can stay home and not forfeit wages when they are ill.  The gov't should help businesses transition because it is in the public health interest to keep employees in high-touch industries home.  The benefit to the community will be immeasurable.  Increases in payroll and income tax revenues.  Decreases in expenditures on SNAP benefits and other forms of gov't assistance that are used disproportionately by tipped workers.

L'Oca d'Oro will be re-opening its' patio in a newly designed and expanded way in the early spring and we'll be paying a base of atleast $15/hr, along with 2 weeks paid time off and full payment of their Direct Primary Care premium.  We want a healthy staff for when we invite guests back.   We hope that the federal government wants the same.

We can't do it alone.  Since the pandemic began, many Austin restaurants have changed the way they pay their employees with the help of Good Work Austin and RAISE and we've gotten the opportunity to consult with others in Raleigh, New Orleans, Milwaukee, Burlington, Providence and more who are figuring out how to do the same.  They've realized that there is no healthy industry if owners, employees, guests and suppliers are healthy.

Next time you're going to spend money at a restaurant, give them a call first and ask them how they pay their staff just like you would call to see if they have any gluten-free options.  When restaurant owners know that this is an issue that customers are using to weigh where to go on Friday night, we may finally see the last of the tipping points.  Until then, it will be the same rhetoric about lost jobs and thin margins that was used to rail against the 40 hour workweek and defend child labor.

It is with difficulty that I must speak against Item 52, the SAVES resolution which provides much needed assistance for childcare and music venues but not nearly enough to make a meaningful difference to Austin’s locally-owned bars & restaurants.  We are the nation’s and the city’s biggest employer, have been damaged in complex ways by this pandemic and no level of gov’t seems capable of taking the risk and finding the funds to help the independent portion of our sector open & stay open safely.  Public health must be the first priority and business owners should be receiving help from our leaders so that the places where transmission is most likely do not feel financial pressure to pack people in and make our community sicker.  The CDC has recently concluded that eating in dining rooms is the activity that most people who have tested positive for coronavirus have in common.  We must recognize that and decide that no amount of illness is acceptable.

 

Which is to say, this resolution is incomplete.  There is no mention of the potential to include money from 380 agreements or money from Convention Center Operating revenue.  There is no mention of contracts that can be awarded to local businesses, utilities relief, property tax relief, exemption of personal guarantees on rental leases or many of the other items that are a part of EDD’s recommendation based on this summer’s food services recovery focus group.

 

Finally, this resolution needs to be need-based.  Establishments that have not been able to open need to be prioritized.  Establishments that have not received prior assistance.  Please come back to us in two weeks with a fund that will be able to touch the over 1000 bars, restaurants and venues that most need help to get to the other side of this without infecting our employees or guests.  You need only look at the amt of applicants to the small business relief grant to determine the size of the need and to Congress to see what inaction looks like.  Please don’t follow their lead.  Take the chance you took by passing the paid leave ordinance and declaring as a Sanctuary city against the will of the State.

KXAN 9/29/20

STATESMAN 10/1/20

Published in the Austin Business Journal

It’s becoming clear that D.C. will not pass more substantial legislation that is supposed to get small businesses and their employees to the other side of the pandemic. Some businesses will close. Employees who were laid off during the temporary shutdown will not have jobs to return to, assuming they can find a job in their industry at all.

The landscape will be changed forever, not the landscape on the I-35 frontage road between Austin and San Antonio. Those Olive Gardens and Bed, Bath & Beyonds aren’t going anywhere. Most national chains can weather a bad year, even a catastrophic year. That’s the point.

Small, local businesses are not like that. These are vital Austin businesses, the ones that differentiate us from the I-35 frontage road — that put us at the top of national lists and “where to live” articles and bring tourists. They are the businesses that keep us from becoming two cities, one city for the people who live here and one for the people who serve them and teach their kids. Small businesses employ more people per dollar created than larger businesses do and at higher average wages. Good Work Austin businesses advocated for the kinds of benefits, from paid sick leave to a $15 minimum wage, and strict reopening guidelines that make Austin stronger and healthier. All the money that we earn, that our businesses earn, and that our employees earn, stays in Austin. We spend it in Austin. We pay taxes on it to Austin and we don’t get large tax breaks to open here. Instead, we pay the escalating property taxes of our multinational developers as part of our lease agreements, and as all of Travis County is aware those have tripled in some areas since 2015.

This is why, no matter what happens in D.C., regardless of how a state struggling with low oil and gas prices tries to balance budgets (likely cutting social safety nets), now is the time that Austin city leaders must decide if small, locally owned businesses are a part of Austin’s future.

A sliver of good news is that there may be resources that exist to make an impact. There is money sitting idle that is being protected for Austin Convention Center expansion that could be accessed as a combination of grants, loans and forgivable loans. It could be tied to performing jobs with civic benefit like increasing food access or providing space for remote learning and child care. The funds could be used to incentivize the kind of business behavior, such as providing medical benefits and paid sick leave, that keeps Austin healthy. Those dollars could even be replenished, as business returns, through a small fee that could act similarly to the hotel occupancy tax. Hundreds of Austin businesses can be saved and have little impact on future expansion plans. After all, what good is an expanded convention center without Austin restaurants and venues to visit and enjoy?

Understanding the impact of local dollars, a program like the Relief Act at the federal level could support local grants at the community level, and should be a part of any future packages, giving cities and counties the ability and flexibility to target their funding to the businesses who need it most and were left out of previous support.

What we need from city leaders is to be bold and have the backs of our local businesses and the employees that have always broken theirs to serve neighbors and visitors alike. Austin can lead here, focus locally and create a set of priorities that would inform the next decade of policy or we could end up as the biggest rest stop on the way from the Valley to Dallas — which is not a desirable destination for your next convention.

“Tomorrow’s May 1st, are you going to pay rent?” The interviewer asking me this question was hidden by the Skype set-up. The truth was, I didn’t know.  I haven’t been thinking about when bills are due during this shutdown.  What I should have said was, “We’re permitted to be open at 25% so that’s how much rent we’ll pay.” Gov. Abbott continued to provide no guidelines on rent or utilities, so it’s up to us, right?  It’s also up to us to fire our employees who don’t want to risk their health to come back to work.  Many of them will also have to pay for childcare, if they can find it, since there’s no school and no camp.    What am I supposed to tell them?

There are still so many questions.  The SBA can’t tell me how a full-time employee (FTE) is being defined for the purposes of using our PPP loan.  Another restaurant owner told me yesterday that the bank told him, “We wanted to make sure we got the money out to you quickly. That’s why there are still some definitions we don’t have.” It goes without saying that the money isn’t useful if you don’t know how it can be used.

 

L’Oca d’Oro has been five different restaurants in the last seven weeks.  I’ve changed our voicemail message more in the last month than in the previous four years.  Our cooks joke that by the time we get good at our most recent incarnation, it’ll be time to change again.  Telling us to re-open is the easiest way for the government to move on without answering all of the questions that it wasn’t equipped to handle in the first place. But businesses built on social interaction and restaurants built on service and fresh ingredients from local purveyors can’t really open again until there’s a treatment or a cure for this virus.

 

Not only is re-opening now, without a plan, a way of avoiding past questions - what do we do with lost inventory - it will be impossible for the least funded amongst us to make it through a year of exhausting, not breaking even days.  Establishments with robust marketing teams & walk-ins of frozen food and employees making $2.13/hr will thrive, as they have been, even more so with the reduced competition.  And, once some restaurants are open and there’s a line out the door as there have been at drive thru lanes, how will the independent wing of our industry keep up the drumbeat for a Restaurant Stabilization Fund to get us to the other side?

 

Now that re-opening is here, though, we need it to work.  The restaurants that are opening are like the groundhog.  If they do it right, we only have two more weeks of shutdown but, if they don’t, we might be looking at many more long weeks of Shutdown Part Deux.  We’re hoping that by voluntarily staying closed, this first Phase will move slowly enough to make Phase II possible In the next two weeks, we will work together with Good Work Austin, an association of small, independent businesses, to develop health protocols with the City that we can all abide by.  It is imperative that we support our local colleagues and police each other because there is no enforcement arm and we have a lot to prove.  The stakes are high and I don’t know how many owners would still have the necessary fight to get through our usual grind if we backslide.

 

Personally, I’m not willing to sacrifice the strides we’ve made towards turning restaurants into food banks and forming GWA to open at 25 or 50% and then potentially lay off my staff again.  So, our employees will all be counseled via zoom with L’Oca d’Oro’s physician.  We’ll make sure we have all the necessary protective equipment and, when we re-open, we’ll take it slowly so we don’t get overwhelmed by the new steps of service and the enhanced cleaning protocol.  We’re going to have to get the messaging to our customers right as well.  We’ll remind them that we have paid sick leave so our guests will know that no worker has to come in when they’re sick.   We need to remind customers  that this isn’t a party yet.  Our staff is in the awkward position of having to tell customers that we can’t serve them.  We’re going to have to learn to be upbeat and gentle with our eyes and our voices behind our masks like the guy at the grocery store who keeps reminding me to walk the other way down the aisle.  We’re going to be dealing with a lot of folks out there like the angry gentleman who phoned to say he would never eat at our restaurant because we were “Chinese Communists” for not re-opening.  Guests like that aren’t going to like a restaurant manager telling them how to behave.

 

L’Oca d’Oro is not staying closed because we fear the virus.  We’re afraid of racing back when there is still so much uncertainty and lack of consensus.  We don’t want to re-open in a world that just wants to get back to normal.  So many owners have seen their employees get turned down for unemployment benefits because they were only making $2.13/hr while chains with $500mil in sales get funding meant for small businesses.  We want to re-open but we want to hear questions like, “is normal really what we’re striving for?”

We missed Pi Day yesterday.  I guess there were some other things going on.

Practically, we are being as diligent about cleaning as we always are.  Staff has been told they can stay home if they want to and we have expanded our Paid Leave benefits for those who have to stay home.  We're promoting our menu ourselves as a takeout option and removing tables from the dining room to create more distance between guests.

Emotionally, this is a roller coaster.  The methods to prevent spread are exponentially more strict than they were four days ago.  While we need to stay open, it also seems irresponsible to tell people that they should come out to dine.  While our friends in the restaurant industry are all talking about how we're going to get through this together, I'm not sure what that means this time because we're not supposed to congregate.  We can't have benefits or fundraisers for the victims because we are the victims and our farms will be as we stop purchasing and our employees who are being cut from shifts and our customers who work in entertainment, retail and other service industries that require in-person contact.

So, while I think we are on top of the situation as it stands now, there is so much uncertainty about how bad and how long.  And there is so little consistent guidance.

It's not time to think about next time or even after but I don't look forward to the anger stage when the virus has passed and folks are dealing with the damage to their small business, their rent payment that they can't afford.  Families and businesses are taught to save for a crisis and to share in times of need. I hope that the powerful and wealthy amongst us will remember that teaching and begin moving us, all of us, to a safer, more secure financial place.

Now more than ever, I know why L'Oca d'Oro is fighting for the city to be allowed to implement the paid sick leave ordinance that L'Oca d'Or and many other businesses helped write. The public needs to know that workers in restaurants can afford to stay home when they are sick.  This can't be left up to industry.  It is a matter of public health which is the government's domain.

It's also very easy to see how eliminating the tipped minimum wage is a piece of this puzzle.  Paid sick leave is based on hourly wages.  Restaurant employees with paid sick leave need to know that what they make while they stay home will be based on a proper wage, not on $2.13/hr.

To the businesses who say they can't afford to implement a paid sick leave policy or raise wages, perhaps there's a short-term gov't incentive or subsidy that could be included in  legislation.  If we can come up with $8billion in a day's notice in disaster relief after the face, then surely we can find some funds for preparedness, to ease business' transition.

Happy Birthday L'Oca d'Oro. Below is the toast from our event last night:

I want to thank all of you who came out tonight and I want to thank all the folks who contributed to the evening, the many donors to the silent auction, Banner distilling, Susto Mezcal & Goodnight Loving Vodka for making Eva & Elena’s amazing cocktails possible and Chefs Michael Fojtasek, Fermin Nunez, Sarah Heard & Nathan Lemley & Mari Soto.  If you haven’t been to Olamaie, Suerte, Foreign & Domestic under new management, or Sweet Ritual, you need to make that happen.  

Speaking to you today, I’m so grateful that we have formed relationships with friends and colleagues who support each other and who we can celebrate with, because you can not successfully run a small business in America today on your own. I saw firsthand over this last year, in court and at the Capitol, the forces lined up against us – the larger corporations, their trade associations who claim to speak for all business and the politicians who are friendly to their cause. What has kept us willing and able to do business in a way that is healthy for us, our employees and our community is the idea of Good Work Austin.

GWA started as a group of businesses working with City Council to write a paid leave ordinance that would be a progressive benefit for workers and not overly burdensome on business. We continued to work together recognizing that to achieve bigger goals, we would need to formalize this association.  Good Work Austin is now a 501c3 and by the end of the year we will have completed a unique website complete with support and resources for businesses looking to eliminate waste, source locally, reduce utilities consumption, transition to Open Books management and One Fair wage. All of this in ways that will be helpful to their businesses’ culture and their bottom line.  GWA will provide inexpensive access to direct primary care and a cost sharing community as well as mental health & wellness benefits with Capital Area Counseling, based on a system that HAAM has already set up for Central TX musicians. GWA will advocate for rewards and incentives for its members to create upward pressure on the folks who are doing the bare minimum to support their workers and our community and for legislation to level the playing field.  Finally, GWA will aggressively promote its members and help to educate consumers about our values and the benefit that GWA businesses provide to Austin. 

In 5 years, we imagine Good Works in Dallas, Houston & San Antonio changing the way Texas does business, and, what’s maybe even more important, ensuring that no small business has to face this struggle alone. 

Thank you again and Happy Birthday to my best friend and business partner, Fiore & L’Oca d’Oro!

"It’s not hard to see why organic food is expensive. Farmers have to price the organic carrots to reflect the cost of production in a world designed for them to fail. In the checkout aisle, we wince. A consensus is reached: Organic carrots are a noble idea but not a practical one to feed our growing population.

And yet, these ingredients could be a lot more practical and affordable if they received more than a sliver of research and development investment. From 1996 to 2018, funding for public organic plant breeding totaled $27.5 million. I’m reminded of a multinational seed company executive who once boasted that his company invested a million dollars a day in corn seed research. A million dollars a day! In 27 days he would blow through 22 years of public organic seed investment.

Imagine the advances an organic vegetable breeder could make with a fraction of that."

Here is a link to Barber, chef at Blue Hill in New York and Future of Food Genius. This is the "race" issue of climate change, health care, job growth, immigration. You name it. The way we treat our food supply - mechanize it, homogenize it and sell it to the highest bidder so we can have the cheapest commodities on the shelves and the highest profits on Wall Street touches so many of our "hot button" topics.

Can we talk about immigration and undocumented immigrants without talking about who makes up the agriculture work force? Can we talk about pollution without talking about the thinning of top soil, drainage of fertilizers and feces, methane produced by overcrowded feedlots? Can we talk about health care without discussing food that lacks nutritional value because it's been grown in over-fertilized soil? Can we talk about jobs and rural america without talking about the lack of subsidies available for family farmers to grow organically and sell locally?

Can we talk about anti-trust laws or money in politics without discussing that the biggest pesticide companies are allowed to become the biggest seed companies? This is not just the way it's always been. This is recent and we can do better.

We were lucky to participate in yesterday's hearing before the State Affairs Committee. Below is my testimony which I hope starts to get at why this is not just an issue regarding paid sick leave but about business' ethical responsibility and the role of city government.

"Good morning Madam Chair Huffman and members of the committee. My name is Adam Orman, owner of L’Oca d’Oro an Italian restaurant in Austin that has been open for three years. I am here today to testify against SB15.

Starting in the fall of 2017, Austin City Council reached out to ask if we wanted to be involved in the creation of a Paid Sick Leave ordinance.  We attended several meetings with over two dozen businesses where we had the opportunity to comment on all aspects of the proposal. It was explained to us in detail and, when there were drafts released, we received them via email along with phone calls from Council members to follow up as to our concerns.

We were honored to be a part of this successful process and there was ample evidence that any business that wanted to be involved would not have been excluded. This seems like a model for how local business regulation should be enacted.  

Functionally, the ordinance imposes no administrative burden.  Between me and our bookkeeper, we were able to easily implement a tool that tracks accrual of sick days that requires no further adjustments.  Our employees call in sick instead of trying to come to work. They go see doctors which is a requirement for receiving sick pay after a certain threshold.  This keeps our other employees healthy and is, as a restaurant, obviously in the interest of public health. If all of our employees used all of their sick days, it would represent less than ½ of 1% of our net sales and, trust me, this is not because we are awash in cash.  And, finally, over the life of our business we continue to add employees.

Senators, I believe it is a privilege to own a business in this great state that provides so much to make running my business efficient.  I hear from my wife all the time that no one made me open a restaurant. Because of that, we, as business owners need to recognize that we need to act in ways that sustain and grow not just our businesses but the health of our communities.  Restaurants are permitted to pay $2.13/hr and are not required to offer anything in the way of Health Benefits. Paid Sick Leave should be the bare minimum of benefits offered to keep our employees healthy which in turn keeps our communities healthy.  

If other municipalities decide that this is not a necessary regulation for all businesses, so be it.  But, Austin, through an open & inclusive process should be allowed to implement the Paid Sick Leave ordinance that was voted on by the democratically elected City Council last year.

Thank you Senators.  "

Transcript of our testimony in Congress on the Raise the Wage Act, 2/13/19:

Thank you members of Congress for your work on the Raise the Wage Act and for giving us an opportunity to tell our stories.

My business partner and I opened L’Oca d’Oro, a full-service Italian restaurant in Austin, TX three years ago. In Austin, the sub-minimum wage is still $2.13/hr.  It was never our intention to be known as much for our labor practices as for our meatballs, but, as former restaurant employees, my partner and I knew from the beginning that we did not want to be a part of the restaurant industry’s race to the bottom, where owners pay as little as they can for their food and for their staff. Instead, we decided that we would start all of our employees at a higher hourly rate than the Federal Minimum wage and include a 20% service charge on all checks that is distributed to the entire staff. This approach allows us to stand out in a crowded labor market; professionalize the jobs of traditionally tipped employees like servers, hosts and backwaiters; create a positive, team-oriented culture; and, as employers, we can determine how much our employees earn rather than leaving their income up to the whims of customer tips.    

To make this work, we have had to become activists in a way we never imagined.  We have had to educate ourselves, our employees and consumers about the exploitive history of tipping.  With greater control of more of our business’ revenue, we are able to provide access to Direct Primary Care and a Medical Cost Sharing Community so our employees have health care benefits.  We have partnered with a local domestic abuse non-profit to lead staff trainings to prevent workplace harassment. We worked closely with Austin’s City Council and other local businesses and nonprofits to craft a paid sick leave ordinance.  With other local businesses, we are forming a trade association called Good Work Austin that will provide resources to other businesses that want to transition to One Fair Wage, provide health care or hire for diversity. We have also helped City Council write an incentive package for small businesses that are guaranteeing a living wage, providing benefits, or reaching other progressive employer standards.

Our customers are attracted to L’Oca d’Oro by how we run our business. Since they don’t have to rely on tips, our employees are inspired to stay with us instead of jumping to the next new hot spot, and they enthusiastically support our model to their guests.  We pay One Fair Wage and we are thriving.

As things currently stand, we can only be competitive with other businesses that are spending a fraction of what we spend by being excellent, a standard that all restaurants should be held to.

The change in the law last year that allows restaurants to pool tips if they pay over the federal minimum wage was a tremendous step in the right direction. It makes it much easier to convince other operators that a new model of restaurant compensation is in their best interest.  But,  to create a truly level playing field, we need Washington to eliminate the tipped minimum wage once and for all.

Thank you.

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