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SANTA CRUZ – The city council in this seaside community has given preliminary approval to the most generous living-wage ordinance in the nation, a minimum wage of $11 an hour with health benefits – or $12 an hour without benefits. 

The Santa Cruz ordinance covers full-time workers employed either by the city or by a for-profit company that has a contract with the city. Businesses facing hardships or unusual circumstances will be able to appeal for an exemption. 

About 60 municipalities in the United States have passed living-wage ordinances. Minneapolis requires its large contractors to pay employees at least $8.25 an hour. Baltimore requires contractors to pay employees at least $6.50 an hour. 

“This is just fantastic,” said David Werlin, a member of the Santa Cruz Living-wage coalition, which helped draft the ordinance. “This is the highest nominal living wage of any ordinance in the United States.” 

Although the minimum is generous compared with other living wages, it should not have that great an impact in a city where wages have skyrocketed because of the growth of the Silicon Valley that provides most of the jobs for Santa Cruz residents. 

Only two current Santa Cruz city employees, both of whom make $9.74 an hour to set up the Louden Nelson Community Center, make less than the newly mandated minimum living wage. 

Patty Haymond, a city analyst, said the city is not sure how many contract employees would be affected, but she said she had not heard of any opposition from for-profit employers. None protested at Tuesday’s city council meeting. 

Council members said approving the living-wage ordinance was a good first step in helping city employees afford to live in Santa Cruz, where housing prices are extraordinarily high. 

The Housing Opportunity Index released six weeks ago by the National Association of Home Builders placed Santa Cruz as the second least-affordable community in the nation, behind only San Francisco. 

“The economics of living in Santa Cruz is a struggle,” said council member Michael Hernandez. “We really need to strive to have greater benefits for our workers.” 

The council unanimously gave preliminary approval Tuesday to the minimum living wage, which would go into effect Thanksgiving Day if the council gives formal approval when the measure returns Oct. 24 for a second reading.