According to Niya Gingerich’s calculations, a change to the city of Edgewater’s minimum wage is on track to save her restaurant $30,000 this year.
That’s because Edgewater did something no other city, county or local government in Colorado dared: It froze the minimum pay of tipped workers for a year. The city has been ramping up to match Denver’s higher minimum wage, which will happen in 2027 when both cities reach $19.84 an hour.
But tipped pay is different. Tipped workers in much of the U.S. can be less than the local minimum as long as their tips can cover the gap (otherwise, employers pay the rest). But a 2025 Colorado law allowed for a wider gap, or tip credit, after hearing from restaurants struggling to survive. Edgewater was the only city to make a change. Instead of a planned $1.67 hourly raise, tipped workers stayed at last year’s tipped minimum wage of $13.50.
Eight months in, has it helped Edgewater Inn?
“Yeah, it absolutely did because I was able to save,” said Gingerich, who bought the restaurant three years ago with her husband.
But the savings only helped the restaurant maintain the status quo. And now Gingerich is concerned about 2027. Edgewater City Council is set to discuss next year’s tipped hourly rate Tuesday. If no change is made this year, the freeze will end and tipped worker pay will return to the old formula, which means an overnight increase of $3.32 an hour to $16.82 on Jan. 1 — a 25% pay raise.
“The system’s broken from every angle. Labor is the biggest (cost) but expenses are up across the board,” said Gingerich, adding that her profit this year isn’t even $30,000. “So unfortunately, there wasn’t even an, ‘Ohhh, this saved us money’ because we were already so tight in 2025. In 2026, all we were doing was just not having another huge hit. We are still just surviving.”
Staying the same is its own type of impact, and other Edgewater restaurant and bar proprietors echoed a similar sentiment. “We didn’t raise prices,” said one. “Higher (tip credit) is better,” said another.
Some yearned for the old days when operating a restaurant was still as hectic as ever and margins were razor thin, and servers were paid a few bucks an hour, literally. That’s still true today in some states, including Kansas, Utah and Texas, which pay the federal tipped-minimum wage of $2.13.
As the cost of living has increased, especially in and around cities like Denver, there’s been support for a higher minimum wage. But along with that, the tipped wage in Colorado grew faster because the difference was a fixed $3.02 less per hour.
It’s a little shocking to some, including David Tremain, who was hired by Gingerich last year. He needed a second job to pay the bills so he returned to a server role, which he hadn’t done since 2021 in Virginia.
When he heard about the pay, he said, “My mouth dropped. I was like, “Are you kidding me?” Because when I worked at Mellow Mushroom (in Virginia), it was $2.13,” Tremain said.
He appreciates the higher wage, in addition to tips. Because the income was better and he felt supported by the restaurant, he quit his other job, which paid less, and went full time at Edgewater Inn Pizza.
“When it comes to things like tipped wages, Colorado does it the best, but I can understand how it could be kind of straining (for employers) as well,” Tremain said. “But at the same time, I can barely afford to live. Yes, I’m making ends meet but there’s no room for savings. I don’t even have health insurance at the moment and I have a busted knee.”
However, he didn’t seem to realize that the tipped wage was frozen this year. He does not want his pay to get cut.
“It’s not a good idea to go backward because that’s how people get pissed. I’m level-headed. I can see both sides. I can see Niya and empathize with her. Most people won’t and they can’t,” he said.
Small-town experiment
The issue really is much more complicated, confusing and extremely local, especially in a city that’s less than a square mile and has a population of 5,000 residents. There’s only 38 licensed restaurants, which includes the food vendors at Edgewater Public Market, according to city officials. In a small city, it’s been an interesting experiment.
One server said that he didn’t even realize his new employer wasn’t in Denver, said Daniel Satogkit, a server at La Mai Thai Kitchen, just across the street from Sloan Lake in Denver. Edgewater’s tipped wage is noticeably less than Denver by $2.77 an hour. The tradeoff so far has been acceptable. He likes the restaurant because he’s Thai, too, and admires the owner and the food. It’s also a good place for where he is in life after 20 years of working at restaurants, mostly in the Denver area.
“My experience is that restaurants having to pay almost $20 an hour for servers is hurting them a lot,” he said. “It makes us have fewer servers (and) more workload. I have to bus my own tables, make my own drinks and I’m here by myself. That’s how it’s been in my last couple of jobs. You’re expected to do everything.”
Satogkit said he felt burnt out at his last job in downtown Denver. After one of the bartenders quit and he had to fill in and instead of working 36 hours a week, he was putting in 60.
“I left because not only were we understaffed, but downtown is tough,” he said. “You have to pay for parking and commuting is a nightmare.”
City Council member Hannah Gay Keao, who voted against the freeze last year because she supports cost of living raises for the lowest-paid workers, hasn’t heard from many restaurant owners — or workers. She said she’ll sometimes casually ask employees when she’s dining out. But it can be weird, she said, “to speak candidly if your boss is looking over your shoulders.”
“The majority of our restaurants are independently owned here. And a lot of owners and workers talk about how it’s like being part of a family where they work,” she said. “We are not able to eliminate the tip wage entirely but I think even if we were, I don’t know if Edgewater going at it alone makes sense. I’m in favor of nationally eliminating the tipped wage because it’s rooted in racism. It’s an exploitative wage structure.”
She put together a worksheet to help fellow council members consider alternatives to the current tip credit. City Council is now considering a policy to keep the tipped wage at 70% to 75% of the local minimum wage, which is pegged to inflation. Right now, tipped workers make 74% of minimum wage. If it returns to old $3.02 tip credit, tipped workers would make 84.9% of minimum wage. But to make the two the same will probably take a new state law.
“We’re not Denver and we’re not Boulder and part of that is we’re really, really small,” Gay Keao said. “But in Edgewater, we can’t control the local economy here. It’s very much a part of the greater Denver metro local economy. … I’m in favor of something that is the easiest and does not cut workers’ wages, and allows them to increase each year. But I’m OK doing something that is below keeping it at $3.02. I’m in favor of moving toward a tip wage as a percentage of the topline minimum wage.”
Either way, the minimum tipped pay is expected to go up next year.
And restaurant owners are speaking out again.
When a reporter walked into Rupert’s at the Edge last week, general manager Jeff Anema was penning a letter to City Council to ask to keep the tipped minimum frozen. It’d been helpful to have “the year off,” he said.
But, he added, “It leaves restaurants with the choice of smaller staff, which means less people have a job, which is counterproductive to the whole concept of more people making a livable wage and it’s slapping a Band-Aid on the wrong wound. A server is making $40 an hour while my kitchen is still at the $20-hour range.”
Paying the kitchen crew more than minimum wage helps retain the back-of-the-house team, who don’t get tips and can’t participate in a shared tip pool unless they interact with customers. Labor is a big expense, but it’s also not the only cost that continues to rise every year.
“The tipped minimum wage freeze hasn’t had a major impact on our day-to-day operations,” Orrapan Botthaisong, owner of La Mai Thai Kitchen, said in an email. “For us, the bigger challenge as a small restaurant is the overall increase in operating costs. Food, supplies, rent, insurance and labor all continue to rise.”
And Edgewater Inn is considering adding a dreaded service fee — something Gingerich has avoided. But she’s seen other restaurateurs with service fees in Denver succeed.
“They saw it coming because they have money to have high-powered people look at this stuff ahead of time. We were all going, ‘What? Why would you do that?’” she said. “I feel like you’re rewarded in this industry. It’s part of the hospitality. You’re encouraged to go above and beyond and be exceptional. But now you’re just guaranteed 20%. I don’t want to do it but we’re going to be forced to.”
What it seems to be coming down to for this community is that it is a very local issue — down to the walls of a business itself. Tremain, the Edgewater Inn server, doesn’t view himself as the best person to speak on behalf of wait staff. That might be one of the other long-term employees, like one of the bartenders, who learned he had cancer several months ago. Gingerich set up a GoFundMe.
“Personally,” Tremain said, “I don’t want (Niya) in pain either because she’s done so much for the community and for us. To see her hurting hurts me as well.”