New Mexicans for Free Enter. v. Santa Fe

Decision Date29 November 2005
Docket NumberNo. 25,073.,25,073.
Citation126 P.3d 1149,2006 NMCA 007
PartiesNEW MEXICANS FOR FREE ENTERPRISE, The Santa Fe Chamber of Commerce, Pranzo, Zuma Corporation, Robbie Day, and Santa Fe Hotel Joint Ventures, Plaintiffs-Appellants, v. THE CITY OF SANTA FE, Defendant-Appellee.
CourtNew Mexico Supreme Court

Ellington & Ellington, L.L.C., Kathrin Kinzer-Ellington, T. Glenn Ellington, Santa Fe, for Appellants.

City of Santa Fe, Bruce Thompson, Jones, Snead, Wertheim & Wentworth, P.A., Jerry Todd Wertheim, Santa Fe, Paul, Weiss, Rifkind, Wharton & Garrison LLP, Sidney S. Rosdeitcher, The Brennan Center for Justice, at NYU Law School, Paul K. Sonn, New York, NY, for Appellees.

Rodey, Dickson, Sloan, Akin, & Robb, P.A., Edward Ricco, Jocelyn Drennan, Albuquerque, for Amici Curiae Association of Commerce and Industry et al.

Sanders & Westbrook, P.C., Duff Westbrook, Maureen A. Sanders, Albuquerque, Columbia Law School, Richard Briffault, New York, NY, for Amici Curiae New Mexico Municipal League et al.

Philip B. Davis, Albuquerque, for Amici Curiae Santa Fe Partnership for Social Justice et al.



{1} Plaintiffs New Mexicans for Free Enterprise, the Santa Fe Chamber of Commerce, and several local business owners challenge an ordinance enacted by the City of Santa Fe mandating certain city-based businesses to pay a minimum wage higher than the current state and federal minimum hourly wage. Plaintiffs contend that the ordinance is beyond the power of a home rule municipality to enact and that the state minimum wage law preempts local policymaking in this area. Further, Plaintiffs argue that the ordinance is a taking of private property and that the ordinance's exemption for small businesses violates equal protection guarantees. Finally, Plaintiffs seek to have the ordinance struck down because the City failed to follow its own rules in passing the ordinance and the trial court abused its discretion in regulating discovery for expert testimony at trial. We conclude that a home rule municipality may set a minimum wage higher than that required by the state Minimum Wage Act, NMSA 1978, §§ 50-4-19 to -30 (1955, as amended through 2003), because of the independent powers possessed by municipalities in New Mexico and the absence of any conflict with state law. Unpersuaded by Plaintiffs' other arguments, we therefore affirm the district court's ruling that the minimum wage ordinance is within the power of the City to enact and is otherwise constitutional.


{2} The significant facts in this case are those surrounding the processes by which the City passed the ordinance as well as the particular provisions of the ordinance. In 2002, the City passed the first version of the ordinance setting a minimum wage above that of the federal and state minimum wages for its own workers, contractors doing substantial business with the City, and other businesses directly receiving city benefits. Santa Fe, N.M., Wage Requirements: Minimum Wage Payment Requirements, ch. XXVIII, § 1.5 (2003). The City also established a Living Wage Roundtable that was directed to "explore and develop" an amendment to the 2002 ordinance that would mandate a living wage for the entire city. The Roundtable reviewed a substantial amount of information regarding local wages, cost of living, the daily challenges faced by both workers and employers in Santa Fe, and the costs and benefits of minimum wage requirements. The Roundtable consisted of nine members representing both labor and business management.

{3} The Roundtable presented majority and minority recommendations to the city council, with management members writing the minority report. The majority recommended, among other things, amending the ordinance to impose minimum wage requirements on all employers citywide, except those with fewer than ten employees. The majority also recommended that there be no credits for employer-provided benefits and that tips be excluded from the wage calculation. The minority, on the other hand, recommended further study to determine the potential impact to the Santa Fe economy and unemployment prior to any further action.

{4} The city council then held public hearings on the amended ordinance proposed by the Roundtable majority, and received input from over 150 speakers on both sides of the issue. Several economists provided input on the impact minimum wage increases would have upon the local economy, businesses, and workers. One economist represented to the city council that the federal and state minimum wage has declined significantly in real dollars.

{5} The council and the Roundtable both had information detailing the Santa Fe employment scene, including figures of how many low-wage workers worked in particular businesses. Early versions of the amended ordinance excluded small businesses, which they defined as those employing fewer than ten workers. On the night that the council was to vote on the amendments to the ordinance, the council expanded the small business exemption by requiring compliance by only those businesses with twenty-five or more workers. The councilor making the proposal noted that expanding the exemption for small businesses would approximately cut in half the number of private businesses impacted while reducing the percentage of Santa Fe low-wage workers benefitting from the higher wage from around 75 percent to around 58 percent.

{6} The amendments to the ordinance passed by a vote of seven to one. The ordinance as amended requires for-profit businesses or non-profit entities that are registered or licensed in Santa Fe and that employ twenty-five or more workers (either full-time or part-time) to pay a minimum hourly wage of $8.50. Id. § 1.5(A)(4), (C). This wage increases to $9.50 in 2006 and to $10.50 in 2008; thereafter, the hourly wage is to be increased in tandem with increases in the Consumer Price Index. Id. § 1.5(B). Employers receive an hourly wage credit for employer-provided health care and childcare. Id. § 1.5(B). Tips are included in the wage calculation if the employee customarily receives at least $100 per month in tips. Id. The ordinance made a violation of its terms a misdemeanor and included provisions for enforcement by the city manager as well as by private, civil actions against an employer. Santa Fe, N.M., Wage Requirements: Enforcement; Remedies ch. XXVIII, § 1.8 (2003).

{7} In passing the amendments to the ordinance, the council issued legislative findings, including a finding that many workers in Santa Fe earn wages insufficient to support themselves and their families and that the community bore the burden when workers could not meet basic needs such as housing, food, shelter, and health care. Santa Fe, N.M., Wage Requirements: Legislative Findings ch. XXVIII, § 1.2(B), (H) (2003). The council also found that the cost of living in Santa Fe is 18 percent higher than the national average, while average earnings in Santa Fe are 23 percent below the national average. Id. § 1.2(E). In finding that Santa Fe housing is substantially more expensive than in most of New Mexico and that low-wage workers must spend a disproportionate portion of their income for housing in Santa Fe, the city council concluded:

A. The public welfare, health, safety and prosperity of Santa Fe require wages and benefits sufficient to ensure a decent and healthy life for workers and their families.


D. Minimum wage laws promote the general welfare, health, safety and prosperity of Santa Fe by ensuring that workers can better support and care for their families through their own efforts and without financial governmental assistance.


I. It is in the public interest to require certain employers benefiting [sic] from city actions and funding, and from the opportunity to do business in the city, to pay employees a minimum wage, a "living wage[,]" adequate to meet the basic needs of living in Santa Fe.

Id. § 1.2(A), (D), (I)

{8} The City, which is a home rule municipality, recited two bases for the authority to pass the ordinance: (1) the powers given to home rule municipalities by the section of our constitution which we will refer to as the "home rule amendment," N.M. Const. art. X, § 6, and the Municipal Charter Act, NMSA 1978, §§ 3-15-1 to -16 (1965, as amended through 1990); and (2) the police and general welfare powers delegated by the legislature to all municipalities by NMSA 1978, §§ 3-17-1 to -7 (1965, as amended through 2003) and §§ 3-18-1 to -31 (1965, as amended through 2003). Santa Fe, N.M., Wage Requirements: Authority of the City of Santa Fe ch. XXVIII, § 1.3.

{9} Opponents of the ordinance filed suit in district court. The district court granted summary judgment for the City on several of Plaintiffs' claims, including a claim that the Minimum Wage Act preempts the ordinance. The issues remaining for trial were that the ordinance violates (1) the home rule amendment, (2) equal protection guarantees of the New Mexico Constitution, (3) procedural due process, (4) eminent domain principles, and (5) the City's own procedural requirement to conduct a fiscal impact study. After a week-long trial devoted primarily to the eminent domain issue, the district court rejected each of Plaintiffs' claims and held the ordinance to be effective on the date of its decision. Plaintiffs timely appealed. Both the district court and this Court denied Plaintiffs' motions to stay the ordinance during the pendency of this appeal; therefore, Santa Fe employers with more than twenty-five workers are currently required to comply with the ordinance.


{10} Plaintiffs make several arguments, which we categorize into four areas: (1) violation of municipal powers, (2) violation of equal protection and eminent domain principles, (3) illegal rate-making, and (4) procedural errors by the City in enacting the...

To continue reading

Request your trial
30 cases
  • Premier Trust of Nev., Inc. v. City of Albuquerque
    • United States
    • Court of Appeals of New Mexico
    • October 1, 2020
    ...there are New Mexico cases suggesting the opposite. Cf. New Mexicans for Free Enter. v. City of Santa Fe , 2006-NMCA-007, ¶ 53, 138 N.M. 785, 126 P.3d 1149 (observing that a "utility had no vested property right to a particular regulatory rate and even if it did, its contracts were clearly ......
  • SWEPI, LP v. Mora Cnty.
    • United States
    • U.S. District Court — District of New Mexico
    • January 19, 2015
    ...¶ 21, 326, 143 N.M. 320, 176 P.3d 309, 315 (quoting New Mexicans for Free Enter. v. City of Santa Fe, 2006–NMCA–007, ¶ 43, 138 N.M. 785, 126 P.3d 1149, 1166 ). If a county or municipal law conflicts with state law, it must be invalidated. See Bd. of Comm'rs of Rio Arriba Cnty. v. Greacen, 2......
  • Protection & Advocacy System v. Albuquerque, 27,199.
    • United States
    • Court of Appeals of New Mexico
    • August 5, 2008
    ...amendment, the statutes, and an ordinance, which involves a question of law reviewed de novo. NMFE, 2006-NMCA-007, ¶ 11, 138 N.M. 785, 126 P.3d 1149. We construe constitutional amendments and statutes by first looking to the text of the amendment or statute and then turning to other indicat......
  • Cobb v. Gammon
    • United States
    • Court of Appeals of New Mexico
    • October 14, 2016
    ...of action such as negligent misrepresentation. See, e.g. , New Mexicans for Free Enter. v. City of Santa Fe , 2006–NMCA–007, ¶ 71, 138 N.M. 785, 126 P.3d 1149 (stating that " ‘where there is conflicting evidence, the [district] court, as fact[-]finder, resolves all disparities in the testim......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT