Question 4, which would give Maine the third highest minimum wage in the country, simply goes too far, too fast and will hurt Maine’s restaurant industry most of all.

While we all can agree that the minimum wage should increase, the elimination of the tip credit in this referendum will change Maine’s critically acclaimed restaurant industry forever. The tip credit allows for restaurateurs to pay half of the prevailing minimum wage (now $3.75 per hour) to servers who generally make much more than the remaining $3.75 to achieve the current minimum wage, or exceed it.

The National Restaurant Association estimates that servers make $14 per hour nationwide. In Maine, restaurateurs who testified in front of the Labor Committee on similar legislation two years ago produced payroll records that showed servers made between $18 and $30 per hour.

There are only seven states that don’t have tip credit and the last one, Minnesota, eliminated it back in 1984. This is not the time to experiment with a fragile but growing industry here in Maine.

Restaurants margins are notoriously thin and may only result in 3- 5 percent to the bottom line. In an average restaurant in Maine, that would be $24,000 to $30,000 per year. The first year of this proposed increase based on the elimination of the tip credit will cost the average restaurant $19,000, severely reducing profits. This does not even include the potential adjustment in wages based on the proposed increase for employees in the $9-$12 dollar per hour range.

Potentially this could cost a restaurant $34,000 per year to comply, quickly wiping out any bottom line.

Contrary to what proponents say, restaurants will not be able to absorb these costs. Who will pay? Employees suffering reductions in hours and/or benefits or maybe even job eliminations, seniors on fixed incomes who will find potential increases of 25 to 50 percent on menu items, servers who will receive reduced pay as Maine residents discount their gratuities, and small business entrepreneur restaurateurs who will no longer be able to turn a profit and, in worst case scenarios, will go out of business.

Ask a server you know how they like the current system and you will see for yourself.

Maine’s restaurant industry, which generated $2.5 billion in sales in 2015, has been a bright and shining star in the Maine economy, when there have been few. To destroy an industry by forcing it to give its highest paid employees a 260 percent raise is a very short-sighted approach that may alter your restaurant experience for the foreseeable future, assuming it survives.

Yes, let’s raise the minimum wage to a reasonable and sustainable level, but Question 4 simply goes too far, too fast.

Greg Dugal is director of government affairs for the Maine Restaurant Association, and treasurer of Maine People for Maine Jobs. He can be reached at [email protected]