Minimum Wage

A group of business leaders submitted paperwork on Wednesday for a ballot measure that would repeal Los Angeles’ gross receipts tax, delivering some financial relief to local employers but also punching an $800-million hole in the city budget.

The proposed measure, called the “Los Angeles Cost of Living Relief Initiative,” would strip away a tax imposed on a vast array of businesses: entertainment companies, child care providers, law firms, accountants, healthcare businesses, nightclubs, delivery companies and many others, according to the group that submitted it.

Backers said that repealing a tax long reviled by the business community would help address the city’s economic woes, creating jobs, allowing businesses to stay in the city and making the economy “more affordable for all Angelenos.”

“This initiative is the result of the business community uniting to fight the anti-job climate at City Hall,” said Nella McOsker, president and CEO of the Central City Assn., a downtown-based business group.

McOsker, one of five business leaders who signed the ballot proposal, said city officials have “ignored the pleas of small- and medium-sized businesses for years.” As a result, scores of restaurants and other establishments, including the Mayan Theater, are closing, she said.

The filing of the ballot proposal immediately set off alarms at City Hall, where officials recently signed off on a plan to lay off hundreds of city workers in an attempt to balance this year’s budget. The city’s business tax generates more than $800 million annually for the general fund — the part of the budget that pays for police patrols, firefighters, paramedic response and other core services.

“Public safety is almost exclusively paid for by the general fund,” said City Administrative Officer Matt Szabo, in an email to The Times. “This measure is an assault on public safety. Proponents of this measure will be directly responsible for cutting police or fire staffing in half if it passes.”

McOsker, asked about L.A.’s financial woes, said the city had a $1-billion shortfall this year and still succeeded in balancing the budget. She is the daughter of City Councilmember Tim McOsker, who sits on the five-member budget committee.

The proposed measure is backed by executives and board members with various groups, including the Los Angeles Area Chamber of Commerce, the Greater San Fernando Valley Chamber of Commerce and VICA, the Valley Industry and Commerce Assn.

VICA president Stuart Waldman said the city’s economy has faltered amid a spate of increased taxes, higher city fees and new regulations. The most recent, he said, is the ordinance hiking the minimum wage for hotel employees and workers at Los Angeles International Airport to $30 per hour by 2028, which was approved by the City Council over objections from business leaders.

“We’re usually playing defense,” said Waldman, who also signed the ballot proposal. “We’ve decided the time has come to play offense.”

The business tax proposal is part of a larger ballot battle being waged this year between businesses and organized labor.

Last month, a group of airlines and hotel industry organizations turned in about 140,000 signatures for a proposed ballot measure aimed at overturning the newly approved hotel and LAX minimum wage. L.A. County election officials are currently verifying those signatures.

Unite Here Local 11, which represents hotel employees, responded with its own package of countermeasures. One would require a citywide election on the construction or expansion of hotels, sports stadiums, concert halls and other venues. Another would hike the minimum wage for all workers in the city, raising it to the level of hotel and airport employees.

Two other measures from Unite Here take aim at companies that pay their CEOs more than a hundred times their median employee in L.A., either by forcing them to pay higher business taxes or by placing limitations on their use of city property.

The ongoing ballot battle is “escalating in ways that are reckless and disconnected from the real work of running a city,” said Councilmember Katy Yaroslavsky, who heads the council’s budget committee. Yaroslavsky, in a statement, said the fight is “unproductive and needs to stop.”

“We just closed a billion-dollar budget gap, and basic services are already severely strained,” she said. “You don’t fix that by removing one of our largest revenue sources with no plan to replace it. We have to fix what is broken and that requires working together to offer real solutions.”

Josué Marcus, spokesperson for the Los Angeles City Clerk, said proponents of the latest ballot measure would need to gather about 140,000 valid signatures for it to qualify. The next city election is in June 2026. McOsker, for her part, said she believes that state law sets a lower threshold — only 44,000 — for measures that result in the elimination of taxes.

Industry leaders have long decried L.A.’s business tax, which is levied not on profits but on the gross receipts that are brought in — even where an enterprise suffers financial losses.

Former Mayor Eric Garcetti argued for eliminating the tax more than a decade ago, saying it puts the city’s economy at a competitive disadvantage. Once in office, he only managed to scale it back, amid concerns that an outright repeal would trigger cuts to city services.

Organizers of the latest proposal said it would not rescind business taxes on the sale of cannabis or medical marijuana, which were separately approved by voters.

SACRAMENTO — In a largely courteous gathering of half a dozen of California’s top gubernatorial candidates, four Democrats and two Republicans agreed that despite the state boasting one of the world’s largest economies, too many of its residents are suffering because of the affordability crisis in the state.

Their strategies on how to improve the state’s economy, however, largely embraced the divergent views of their respective political parties as they discussed housing costs, high-speed rail, tariffs, climate change and homelessness on Wednesday evening at the first bipartisan event in the 2026 race to replace termed-out Gov. Gavin Newsom.

“Californians are innovators. They are builders, they are designers, they are creators, and that is the reason that we have the fourth largest economy in the world,” said former Rep. Katie Porter, a Democrat from Irvine. “But businesses and workers are being held back by the same thing. It is too expensive to do things here. It is too expensive to raise a family. It is too expensive to run a business.”

Conservative commentator Steve Hilton, a Republican, argued that state leaders need to end the “stranglehold” of unions, lawyers and climate change activists on California policy.

“I’ve been traveling this state. Everywhere I go, it’s the same story, this heartbreaking word that I get from every business I meet, every family is in such a struggle in California,” he said, with a raspy voice that he explained immediately upon taking the stage was caused by a sore throat.

At the forum were former Rep. Katie Porter, top row from left, Riverside County Sheriff Chad Bianco and former legislative leader Toni Atkins; former Los Angeles Mayor Antonio Villaraigosa, bottom row from left, Lt. Gov. Eleni Kounalakis and conservative commentator Steve Hilton.

(Allen J. Schaben / Los Angeles Times)

The candidates spoke to about 800 people at a California Chamber of Commerce dinner during the 80-minute panel at the convention center in Sacramento. The chamber’s decision on whom to invite to the forum was based on which ones were leaders in public opinion surveys and fundraising. Making the cut were former Senate President Pro Tem Toni Atkins, Riverside County Sheriff Chad Bianco, Hilton, Lt. Gov. Eleni Kounalakis, Porter and former Los Angeles Mayor Antonio Villaraigosa. Former U.S. Health and Human Services Secretary Xavier Becerra was also invited to participate in the forum but had a scheduling conflict.

The sharpest exchange of the evening was between Kounalakis, a Democrat, and Bianco, a Republican.

After the candidates were asked about President Trump’s erratic tariff policies, Kounalakis cited her experience working for her father’s real estate company as she criticized Bianco for arguing for a wait-and-see approach toward the president’s undulating plans.

“You’re not a businessman, you’re a government employee,” she said to Bianco. “You’ve got a pension, you’re going to do just fine. Small businesses are suffering from this, and it’s only going to get worse, and it’s driven, by the way, it is driven by Donald Trump’s vindictiveness toward countries he doesn’t like, countries he wants to annex, or states he doesn’t like, people he doesn’t like. This is hurting California, hurting our people, and it’s only going to make things worse, until we can get him out of the White House.”

Bianco countered that Kounalakis and the other Democratic gubernatorial candidates are directly responsible for the economic woes facing Californians because they have an “unquenchable thirst” for money to fund their liberal agenda.

“I just feel like I’m in ‘The Twilight Zone.’ I have a billionaire telling me that my 32 years of public service is OK for my retirement,” he said. “It’s taxes and regulations that are driving every single thing in California up. We pay the highest taxes, we pay the highest gas, we pay the highest housing, we pay the highest energy.”

The Democrats onstage, though largely agreeing about policy, sought to differentiate themselves. The sharpest divide was about whether to raise the minimum wage. On Monday, labor advocates in Los Angeles proposed raising it in Los Angeles County.

Atkins reflected most of her fellow Democrats’ views, saying that while she wanted to see higher wages for workers, “now is not the time.” Villaraigosa said that while he believes in a higher minimum wage, “we can’t just keep raising the minimum wage.”

Kounalakis, though, said not increasing the minimum wage would be inhumane.

“I think we should be working for that number, yes, I do,” she said. “You want to throw poor people under the bus.”

California’s high cost of living is a pressing concern among the state’s voters, and the issue is expected to play a major role in the 2026 governor’s race.

Nearly half feel worse off now compared with last year, and more than half felt less hopeful about their economic well-being, according to a poll released in May by the UC Berkeley Institute of Governmental Studies that was co-sponsored by The Times.

Nearly exactly a year before the gubernatorial primary next year, the event was the first time Democratic and Republican candidates have shared a stage. It was also the first time GOP candidates Bianco and Hilton have appeared together.

Although the state’s leftward electoral tilt makes it challenging for a Republican to win the race — Californians last elected GOP politicians to statewide office in 2006 — Bianco and Hilton are battling to win one of the top two spots in next year’s primary election.

The pair expressed similar views about broadly ending liberal policies, such as stopping the state’s high-speed rail project and reducing environmental restrictions such as the state’s climate-change efforts that they argue have increased costs while having no meaningful effect on the consumption of fossil fuels.

A crucial question is whether Trump, whom both Bianco and Hilton fully support, will eventually endorse one of the Republican candidates.

The gubernatorial candidates, some of whom have been running more than a year, have largely focused on fundraising since entering the race. But the contest to replace Newsom is growing more public and heated, as seen at last weekend’s California Democratic Party convention. Several of the party’s candidates scurried around the Anaheim convention center, trying to curry favor with the state’s most liberal activists while also drawing contrasts with their rivals.

But the Democratic field is partially frozen as former Vice President Kamala Harris weighs entering the race, a decision she is expected to make by the end of the summer. Harris’ name did not come up during the forum.

There were a handful of light moments.

Porter expressed a common concern among the state’s residents when they talk about the cost of living in the state.

“What really keeps me up at night, why I’m running for governor, is whether my children are going to be able to afford to live here, whether they’re going to ever get off my couch and have their own home,” she said.

A coalition of airlines, hotels and concession companies at Los Angeles International Airport filed paperwork Thursday to force a citywide vote on a new ordinance hiking the minimum wage of hotel and airport workers to $30 per hour by 2028.

The group, known as the L.A. Alliance for Tourism, Jobs and Progress, is hoping to persuade voters to repeal the ordinance. But first, the alliance would need to gather about 93,000 signatures within 30 days to qualify the measure for the ballot in an upcoming election.

Phil Singer, a spokesperson for the alliance, said the wage increase “threatens revenue Los Angeles urgently needs” — and its standing as the host of the 2028 Olympic and Paralympic Games.

“Small businesses will be forced to shut down, workers will lose their jobs, and the economic fallout will stretch across the city,” Singer said in an email. “We’re fighting for all of it: the city’s future, the jobs that sustain our communities, and the millions of guests the tourism industry proudly serves year after year.”

The new ballot measure campaign comes just two days after Mayor Karen Bass signed the minimum wage legislation into law.

The wage ordinance has been hotly opposed by an array of L.A. business organizations, which argue that it increases wages in the tourism industry too much and too quickly. However, it was welcomed by unions representing hotel and airport employees, which have supported many of the politicians who backed the measure.

The alliance’s campaign committee has received major funding from Delta Airlines, United Airlines and the American Hotel & Lodging Assn., Singer said. The group’s petition, submitted to the city clerk’s office, was signed by five businesspeople, including Greg Plummer, operator of an LAX concession company; Mark Beccaria, a partner with the Hotel Angeleno on L.A.’s Westside; and Alec Mesropian, advocacy manager with the organization known as BizFed.

The alliance is targeting a law that’s slated to push the hourly minimum wage to $22.50 on July 1 for housekeepers, parking attendants and hotel restaurant workers, as well as LAX skycaps, baggage handlers and concession employees. The wage would jump to $25 in 2026 and $27.50 in 2027.

The wage increase was spearheaded by Unite Here Local 11, the hotel and restaurant worker union, and by Service Employees International Union United Service Workers West, which represents private-sector airport workers.

Kurt Petersen, co-president of Unite Here Local 11, called the business group’s proposal “shameful” and promised his union’s members would go “toe to toe out on the streets” with the alliance’s signature gatherers.

“The hotel industry’s greed is limitless,” Petersen said. “They would rather spend millions getting them to sign this petition than pay their workers enough to live in Los Angeles. It’s shameful, but we’re confident that Angelenos will see through their deceptions and stand with workers.”

Under the city’s laws, hotel and airport workers have minimum wages that are higher than those who are employed by other industries.

The hotel minimum wage, approved by the council in 2014, is currently $20.32 per hour. The minimum wage for private-sector employees at LAX is $25.23 per hour, which includes a $5.95 hourly healthcare payment.

For nearly everyone else in L.A., the hourly minimum wage is $17.28, 78 cents higher than the state’s. The federal minimum wage is $7.25 per hour.

Backers of the airport and hotel minimum wage hikes say they will help some of the region’s lowest paid workers cover the rising cost of rent and food, while also giving them more disposable income to spend locally, delivering a boost to the region’s economy.

Detractors say it will undermine efforts by L.A.’s tourism industry to recover from the decline in business that was sparked by the outbreak of COVID-19 five years ago. They contend the ordinance will lead to layoffs, while also chilling development of new hotels.

The ordinance also requires airport and hotel businesses to provide an hourly healthcare payment — on top of the minimum wage — that starts at $7.65 in July and is expected to go up each year. (Hotels will be exempted from that requirement until 2026.)

Once the healthcare requirement is included, some businesses will be required to pay their workers an additional 60% over a three-year period, opponents of the wage increase say.

When Los Angeles City Council members took up a plan to hike the wages of tourism workers this week, they received some carefully worded advice from city lawyers: Don’t vote on this yet.

Senior Assistant City Atty. Michael J. Dundas advised them on Wednesday — deep into their meeting — that his office had not yet conducted a final legal review of the flurry of last-minute changes they requested earlier in the day.

Dundas recommended that the council delay its vote for two days to comply with the Ralph M. Brown Act, the state’s open meeting law.

“We advise that the posted agenda for today’s meeting provides insufficient notice under the Brown Act for first consideration and adoption of an ordinance to increase the wages and health benefits for hotel and airport workers,” Dundas wrote.

The council pressed ahead anyway, voting 12-3 to increase the minimum wage of those workers to $30 per hour by 2028, despite objections from business groups, hotel owners and airport businesses.

Then, on Friday, the council conducted a do-over vote, taking up the rewritten wage measure at a special noon meeting — one called only the day before. The result was the same, with the measure passing again, 12-3.

Some in the hotel industry questioned why Council President Marqueece Harris-Dawson, who runs the meetings, insisted on moving forward Wednesday, even after the lawyers’ warning.

Jackie Filla, president and chief executive of the Hotel Assn. of Los Angeles, said the decision to proceed Wednesday gave a political boost to Unite Here Local 11, which represents hotel workers. The union had already scheduled an election for Thursday for its members to vote on whether to increase their dues.

By approving the $30 per hour minimum wage on Wednesday, the council gave the union a potent selling point for the proposed dues increase, Filla said.

“It looks like it was in Unite Here’s financial interest to have that timing,” she said.

Councilmember Monica Rodriguez, who opposed the wage increases, was more blunt.

“It was clear that Marqueece intended to be as helpful as possible” to Unite Here Local 11, “even if it meant violating the Brown Act,” she said.

Harris-Dawson spokesperson Rhonda Mitchell declined to say why her boss pushed for a wage vote on Wednesday after receiving the legal advice about the Brown Act. That law requires local governments to take additional public comment if a legislative proposal has changed substantially during a meeting.

Mitchell, in a text message, said Harris-Dawson scheduled the new wage vote for Friday because of a mistake by city lawyers.

“The item was re-agendized because of a clerical error on the City Attorney’s part — and this is the correction,” she said.

Mitchell did not provide details on the error. However, the wording on the two meeting agendas is indeed different.

Wednesday’s agenda called for the council to ask city lawyers to “prepare and present” amendments to the wage laws. Friday’s agenda called for the council to “present and adopt” the proposed changes.

Maria Hernandez, a spokesperson for Unite Here Local 11, said in an email that her union does not control the City Council’s schedule. The union’s vote on higher dues involved not just its L.A. members but also thousands of workers in Orange County and Arizona, Hernandez said.

“The timing of LA City Council votes is not up to us (sadly!) — in fact we were expecting a vote more than a year ago — nor would the precise timing be salient to our members,” she said.

Hernandez said Unite Here Local 11 members voted “overwhelmingly” on Thursday to increase their dues, allowing the union to double the size of its strike fund and pay for “an army of organizers” for the next round of labor talks. She did not disclose the size of the dues increase.

Dundas’ memo, written on behalf of City Atty. Hydee Feldstein Soto, was submitted late in Wednesday’s deliberations, after council members requested a number of changes to the minimum wage ordinance. At one point, they took a recess so their lawyers could work on the changes.

By the time the lawyers emerged with the new language, Dundas’ memo was pinned to the public bulletin board in the council chamber, where spectators quickly snapped screenshots.

The Los Angeles City Council voted Wednesday to approve a sweeping package of minimum wage increases for workers in the tourism industry, despite objections from business leaders who warned that the region is already facing a slowdown in international travel.

The proposal, billed by labor leaders as the highest minimum wage in the country, would require hotels with more than 60 rooms, as well as companies doing business at Los Angeles International Airport, to pay their workers $30 per hour by 2028.

That translates to a 48% hike in the minimum wage for hotel employees over three years. Airport workers would see a 56% increase.

On top of that, hotels and airport businesses would be required to provide $8.35 per hour for their workers’ health care by July 2026.

The package of increases was approved on a 12-3 vote, with Councilmembers John Lee, Traci Park and Monica Rodriguez opposed. Because the tally was not unanimous, a second vote will be required next week.

Rodriguez, who represents the northeast San Fernando Valley, told her colleagues that the proposal would cause hotels and airport businesses to cut back on staffing, resulting in job losses. The same thing is happening at City Hall, with elected officials considering staff cuts to cover the cost of employee raises, she said.

“We are right now facing 1,600 imminent layoffs because the revenue is just not matching our expenditures,” Rodriguez said. “The same will happen in the private sector.”

Councilmember Hugo Soto-Martínez, standing before a crowded of unionized workers after the vote, celebrated their victory.

“It’s been way too long, but finally, today, this building is working for the people, not the corporations,” said Soto-Martínez, a former organizer with the hotel and restaurant union Unite Here Local 11.

Hotel owners, business groups and airport concession companies predicted the wage increases will deal a fresh blow to an industry that never fully recovered from the COVID pandemic. They pointed to the recent drop-off in tourism from Canada and elsewhere that followed President Trump’s trade war and tightening of the U.S. border.

Adam Burke, president and chief executive of the Los Angeles Tourism and Convention Board, said Canada, France, Germany, Ireland, the Netherlands and the United Kingdom — nations that send a large number of visitors to Los Angeles — have issued formal advisories about visiting the U.S.

“The 2025 outlook is not encouraging,” Burke said.

Several hotel owners have warned that the higher wage will spur them to scale back their restaurant operations. A few flatly stated that hotel companies would steer clear of future investments in the city, which has long served as a global tourism destination.

Jackie Filla, president and chief executive of the Hotel Association of Los Angeles, said she believes that hotels will close restaurants or other small businesses on their premises — and in some cases, shut down entirely.

In the short term, she said, some will tear up their “room block” agreements, which set aside rooms for the 2028 Olympic and Paralympic Games.

“I don’t think anybody wants to do this,” Filla said. “Hotels are excited to host guests. They’re excited to be participating in the Olympics. But they can’t go into it losing money.”

Jessica Durrum, a policy director with the Los Angeles Alliance for a New Economy, a pro-union advocacy group, said business leaders also issued dire warnings about the economy when previous wage increases were approved — only to be proven wrong. Durrum, who is in charge of her group’s Tourism Workers Rising campaign, told the council that a higher wage would only benefit the region.

“People with more money in their pockets — they spend it,” she said.

Wednesday’s vote delivered a huge victory to Unite Here Local 11, a potent political force at City Hall. The union is known for knocking on doors for favored candidates, spending six figures in some cases to get them elected.

Unite Here Local 11 had billed the proposal as an “Olympic wage,” one that would ensure that its members have enough money to keep up with inflation. The union, working with airport workers represented by Service Employees International Union-United Service Workers West, also said that corporations should not be the only ones to benefit from the Olympic Games in 2028.

Workers from both of those unions testified about their struggles to pay for rising household costs, including rent, food and fuel. Some pleaded for better health care, while others spoke about having to work multiple jobs to support their families.

“We need these wages. Please do what’s right,” said Jovan Houston, a customer service agent at LAX. “Do this for workers. Do this for single families. Do this for parents like myself.”

Sonia Ceron, 38, a dishwasher at airline catering company Flying Food Group, said she has a second job cleaning houses in Beverly Hills for about 32 hours a week. Ceron lives in a small studio apartment in Inglewood, which has been difficult for her 12-year-old daughter.

“My daughter, like every kid, wants to have her own room, to be able to call her friends and have her privacy. Right now, that’s impossible,” Ceron said.

L.A.’s political leaders have enacted a number of wage laws over the last few decades. The hotel minimum wage, approved by the council in 2014, currently stands at $20.32 per hour. The minimum wage for private-sector employees at LAX is $25.23 per hour, once the required $5.95 hourly healthcare payment is included.

For nearly everyone else in L.A., the hourly minimum wage is $17.28, 78 cents higher than the state’s.

Perched high above the Cahuenga Pass, the 24-story Hilton Los Angeles Universal City Hotel is positioned to be a prime gathering spot for visitors arriving for the 2028 Summer Olympic and Paralympic Games.

Sun Hill Properties Inc., which manages the 495-room hotel, has already signed a “room block” agreement with the LA28 organizing committee, reserving hundreds of rooms for Olympics fans. The City Council recently approved a plan to let the Hilton add a second, 18-story tower, which would open just in time for the Olympics.

Now, the future of the $250-million expansion is in doubt. On Wednesday, the Los Angeles City Council is set to vote on a requirement that hotels with 60 or more rooms pay their workers at least $30 per hour by 2028, along with a new $8.35 per hour healthcare payment.

If the council approves the proposal without significant changes, Sun Hill “absolutely will be pulling out of the room block for the Olympics,” said Mark Davis, the company’s president and chief executive. The hotel’s investors will also kill the 395-room expansion, he said.

“Our board was very adamant that if [council members] go forward with this nonsense, that it’s dead,” Davis said. “They’re going to move the project somewhere else.”

The council voted 12-3 last year to instruct City Atty. Hydee Feldstein Soto to draft the package of minimum wage hikes, which would apply not just to hotels but also private companies at Los Angeles International Airport, such as airlines and concessions. The minimum wage would be the highest in the country, according to Unite Here Local 11, the hotel and restaurant workers union, which has championed the proposal.

Mark Davis, president and CEO of Sun Hill Properties, said a proposal to hike L.A.’s minimum wage for hotel workers would kill a plan for a new 18-story hotel tower unless it is reworked.

(Marcus Ubungen / Los Angeles Times)

Backers of the higher wage say L.A.’s tourism workers are struggling to pay for food and rent, and deserve to benefit financially from the Olympics just as much as private corporations. They dismiss the hospitality industry’s dire warnings, including the notion that increased wages will scuttle the development of new hotels.

City Councilmember Hugo Soto-Martínez said the Sheraton Universal Hotel, a nearby competitor of the Hilton, has already been paying a higher wage to its unionized workforce. The real threat to the development of new hotels, he said, is higher interest rates and the economic uncertainty surrounding President Trump’s trade policies.

“So, I just don’t buy it,” said Soto-Martínez, a former hotel union organizer, as he referred to Davis’ warning.

Under the city’s proposal, the hotel and airport minimum wage would reach $22.50 on July 1. It would jump to $25 in July 2026, $27.50 in July 2027 and $30 in July 2028. On top of those increases, the $8.35 per hour healthcare payment would go into effect on Jan. 1.

Business groups point out that two hotels have closed in the past year — Four Points by Sheraton next to LAX and Mama Shelter in Hollywood, for a loss of 270 jobs. They say Trump’s trade wars are driving down tourist activity from other nations, with visitors from Canada especially lagging.

Once the increases are in effect, business leaders say, hotels with on-site dining won’t be able to compete with non-hotel restaurants, which will have a much lower minimum wage.

Jon Bortz, chairman and chief executive of the Pebblebrook Hotel Trust, said his company is already looking at scaling back restaurant operations at two of its Southern California properties — the Kimpton Hotel Palomar and the W Los Angeles West Beverly Hills, both in Westwood near UCLA.

The Palomar will likely offset the cost of the higher minimum wage by converting its restaurant into a self-service breakfast operation, while the W will probably close at least one of its two restaurants, Bortz said. “We have to change the business model of these properties to have any hope of surviving,” he added.

Bortz said the proposed wage hikes, along with other hotel regulations approved by the City Council in recent years, have spurred Pebblebrook to look to other markets for new hotel projects.

“Frankly, the [L.A.] market, from a broad-based buyer perspective, has been crossed off the map by investors,” he said.

Hotels in other parts of L.A. are considering similar reductions. An executive with Lightstone Group, which owns the 727-room Moxy + AC Hotels near the Convention Center, told City Council members last year that the minimum wage proposal would likely result in the closure of Level 8, a collection of restaurants on the hotel’s eighth floor.

Mark Beccaria, a partner with the Hotel Angeleno near the 405 Freeway, said in a separate letter to city leaders that he would have to shutter not just the hotel’s restaurant but also its valet parking, eliminating 39 jobs.

“Common sense says you cannot raise wages over 50% in a year when revenues are down,” he said.

Kurt Petersen, co-president of Unite Here Local 11, accused the hotels of fear-mongering, saying they are misrepresenting the potential impact of the planned wage hikes. Hotel owners, he said, “act like the sky is falling every time they have to share profits with their workers.”

“This ‘Chicken Little’ stuff has got to end. Every single time, hotels cry poverty, and then a day later, they’re doing fine. It’s always the same routine,” Petersen said. “What’s not falling is rent and healthcare. What’s not sustainable is workers not earning enough to live in Los Angeles.”

The hospitality industry issued similar warnings a decade ago — when the council approved the current hotel minimum wage — only to see tourism flourish in the years that immediately followed, said Víctor Sánchez, executive director of the L.A. Alliance for a New Economy, a pro-labor advocacy group that produced a report on that phenomenon.

In Long Beach, where residents voted to raise the hotel minimum wage last year, revenue per available room was up 15.7% in March compared with the same month the prior year, said Sánchez, citing data from the real estate group CoStar.

L.A.’s political leaders have enacted a number of wage laws over the last few decades. The hotel minimum wage, approved by the council in 2014, is currently $20.32 per hour. The minimum wage for private-sector employees at LAX is $25.23 per hour, once the required $5.95 hourly healthcare payment is included. Then there’s the minimum wage for nearly everyone else in L.A., which is $17.28 per hour — 78 cents higher than the state’s.

The hourly minimum wage for hotel and airport workers was already slated to go up this year, as part of regularly scheduled increases in the city’s wage laws. Once the council showed interest in the much larger increases, business leaders began warning that hotel developers would take their business elsewhere.

Few were as dramatic as Davis, who told council members that their proposal, as drafted, would “likely kill” the Universal City Hilton’s 395-room expansion.

Davis, whose company has hotels in Simi Valley, Colorado Springs, Colo., and the greater Denver area, said his board instructed him last year to look at acquiring property outside of California, in markets that “make more sense financially for an investment of $250 million.”

“The owners investing this money, they have to look at the numbers,” he said in an interview. “Any project survives only by its numbers.”

The Universal City Hilton already pays most of its workers more than $25 per hour, while also offering healthcare coverage, Davis said. If those health plans have a financial value lower than the $8.35 per hour, the company will need to make up the difference, he said.

Davis said he, too, is looking at scaling back restaurant operations, which would likely require layoffs.

At one point, Davis’ project drew support from the city’s political leaders.

The Universal City Hilton reached an agreement early on with construction trade unions, promising to pay a higher prevailing wage to the estimated 1,000 construction workers who would work on the new tower.

In August, the council voted unanimously to seek an economic analysis that would determine whether the city should provide taxpayer assistance to the project. The analysis, requested by Councilmembers Nithya Raman and Soto-Martínez, would have explored whether to allow the hotel to keep a share of the tax revenues generated by the new tower.

Raman, whose district includes a portion of Universal City, did not respond to questions from The Times about the project — or the potential impact of the higher tourism wage.

In recent days, the Hotel Assn. of Los Angeles has been appealing directly to Mayor Karen Bass, purchasing digital ads that ask her to intervene on the minimum wage issue.

Bass, in an interview earlier this year, said she wants hotel workers to “make a decent living” while also ensuring that their employers “are able to survive.”

“We have to make sure that we can address both — that we can address the needs of the workers without crippling the industry,” she said.