Build Miami Beach workforce housing ahead of subsidies

Miami Beach wants city employees to live in town. But making that happen could be extremely costly and difficult.

Cities often want their staff to live within their borders. That helps city employees understand the needs of residents, and if they live there workers have a real stake in how well the city does. They also respond faster to emergencies, and they pay taxes and spend paychecks in the city where they work.

It’s so important to some cities to have only residents on the payroll that they mandate it: 10 of the 30 largest US cities have a requirement that those on the city payroll must live in the city. Philadelphia, for example, can’t hire anyone for its staff until they have already lived in Philly for a year.

Miami Beach also wants its staff to be Beach residents, but it has a tremendous problem: the cost of living – especially housing and transportation – is through the roof in the island city that is a vacation magnet for the globe. Best Places website says Miami Beach transportation costs 32% above the national average. Housing costs 60% more.

If Miami Beach required city staff to live in town, it would either have to raise pay substantially so that city workers could match the spending of high-rollers from around the globe who vacation there or it would have very few municipal employees – far below its needs.

As Miami Today’s Kylea Henseler reported last week, only about 200 of the 2,100 Miami Beach employees now live in the city – under 10%. Fewer than 20 members of the police and fire departments live in the city, said Commissioner Micky Steinberg, who is proposing stipends to lure the city’s employees to actually live there.

Ms. Steinberg, who says she’s flexible to ideas that can lure city staff to the Beach, has suggested a $300,000 pilot program to give 100 first responders $250 apiece each month for a year to help them pay more for housing in the city.

To be fair to all city workers, however, that fund should be open to all 2,100 of them. That would cost city taxpayers $6.3 million each year to get city employees to move in and stay there. 

Even if that’s feasible, the city would need just for its employees 1,900 more housing units priced low enough that a $3,000 annual subsidy could be an attractive lure. That could mean doubling the total 2,055 affordable apartments in the city. Where would those units be built, and by whom?

The city now has 43,326 households, according to the US Census. Adding 1,900 municipal employee households would be a 4.4% household increase. But where?  

City code tells the story well: “The city finds that there is a critical shortage of affordable and workforce housing, making residency on Miami Beach by the majority of city resident workers extremely difficult, and creating a shortage of affordable rental units. The resident workforce is leaving the city in search of affordable housing, and new employees are being deterred by the high cost of living. To maintain a sufficient resident workforce in all fields of employment, and to ensure the public safety and general welfare of the residents of the city, resident workforce housing needs must be addressed.”

Addressing those very real needs is admirable. Do it. 

Meanwhile, however, adding city staff to the glut of seekers of affordable housing is likely to intensify the problem. City subsidized employees would get to the front of the line at the expense of those who work in Miami Beach for private employers and also want to live in the city. 

A break for municipal workers, in other words, is likely to come at the expense of other workers as municipal employees bid up the price of extremely tight workforce housing.

Add another practical question: would $250 monthly per municipal employee make enough difference from what they now pay elsewhere to get them to move to the city that employs them? Less commuting time might be a deciding factor.

Ms. Steinberg’s concept is creative. People who live near work are often happier and more committed to their job, so city employee retention could be easier if workers lived there.

But the city can’t mandate that employees live in town without losing most of them. So cash incentives might help. Study is needed on what could work.

But it seems clear that without more workforce housing at reasonable prices, a successful incentive that lures municipal workers to live in Miami Beach would merely displace two other groups from that same housing: visitors and employees of businesses in Miami Beach.

Should the city offer incentives of $6.3 million or more yearly to do that? Vacationers, after all, are the backbone of Miami Beach. And pricing out workers at enterprises within the city could be equally counterproductive.

Miami Beach might better invest $6.3 million a year in more workforce housing of the type the city is proposing at Collins Park for teachers, the Miami City Ballet corps and other local workers.

Housing costs soar when demand rises and supply doesn’t. Subsidizing one group seeking that limited housing tilts the playing field. Adding more housing in that price range and making it available to all seems a better way to achieve the city’s admirable aims.