Saying it would offer relief to New Hampshire's working families, Gov. John Lynch signed a bill into law yesterday raising the state minimum wage - the lowest in New England - for the first time in a decade.

"Many of our families are working hard just to get by. They are struggling to pay for gas, rent, child care and groceries. The cost of all these things has increased significantly in the last 10 years, but New Hampshire's minimum wage has not," Lynch said.

The rate will increase in two steps from $5.15 per hour to $6.50 on Sept. 1 and to $7.25 the following Sept. 1. The last increase was in 1997.

A University of New Hampshire study said roughly 26,500 New Hampshire workers are expected to benefit from the increase, most of them women, parents or older adults.

"Having been here for each of the 10 years we did nothing to adjust the minimum wage, it's been a huge satisfaction to see the New Hampshire Legislature do the right thing," said Sen. Peter Burling, one of the sponsors.

Currently, New Hampshire's minimum is the same as the federal rate. Congress is considering a similar increase but so far has not adopted it.

New Hampshire will still be lower than its neighbors. Maine's $6.75 minimum wage goes up to $7 Oct. 1. Vermont's minimum wage, tied to inflation, rose from $7.25 to $7.53 on Jan. 1.

The New Hampshire Lodging and Restaurant Association tried to have lawmakers freeze the rate paid to employees who get tips. Association President Michelline Dufort stressed that the industry was not opposed to the minimum wage increase for other workers, including cooks and dishwashers.

The association wanted to freeze the base hourly wage at $2.38 for tipped workers. Under the new law, they will get 45 percent of the minimum wage.

Once the minimum hits $7.25, New Hampshire's tipped rate will be $3.26 - still lower than most surrounding states.

Supporters pointed to last year's study by the University of New Hampshire Office of Economic Initiatives and the North Country Council that concluded that a livable wage for a single person in New Hampshire is $10.42 per hour. A livable wage for a family of four - with both parents working - would be $11.69 per hour for each parent.

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By NORMA LOVE

The Associated Press