yes, exactly. in places where the min wages is over the federal, it is almost always because the cost of living is so much.
like DC, or San Fransisco. try to find somewhere to stay in DC for less than $900/month, i dare you.
or how about this... im hourly, $18/hr, about 36-38 hours per week. now take out taxes (i usually figure it at about 25% for all of it), child support $440/mo, and the company health plan im forced to get ( due to custody and paperwork from the state) at $220/mo, im left with what someone making $10/hour would get. conversely, it costs me more than minimum wage in my area just to cover taxes, child support and health insurance for my son. Don't leave much left over.