Real Estate

Miami Beach Admits It's Failed to Create Affordable Housing, Debates Lower Goals

A Miami Herald series earlier this year showed that Miami Beach's luxury hotels — built for real-estate magnates, international billionaires, pro athletes, and reality stars — are staffed by low-earning housekeepers who can't afford rent on the Beach and are forced to spend hours riding buses every day. The state minimum wage, capped at $8.15 per hour, has not kept up with the city's luxury-level rents, and living a humane distance from work is virtually impossible.

In 2011, Miami Beach passed a comprehensive plan that set targets to build housing for the poor by 2020. The city was supposed to build a whopping 16,000 affordable-housing units on the barrier island in nine years. But given how expensive land in Miami Beach has become and that the deadline is now less than three years away, it's clear the city won't meet that goal. In the six years since passing the plan, the city has not come close to hitting its benchmarks. Rents have instead ballooned.

So in response, the city will vote today on whether to kick the can down the road another ten years and aim to build fewer units in that timeframe: only 6,800 by 2030. City documents don't say how many of the originally targeted 16,000 apartments have been built. But in exchange for taking an extra ten years to complete a watered-down version of its affordable-housing plan, the city wants to pass extra zoning incentives to try to entice developers to build apartment complexes for low- and middle-income people.

"Due to limitations in floor area and the high cost of land, the city feels that the 6,800 number can be achieved with the proposed modifications to the Comprehensive Plan and Land Development Regulations," reads the proposed ordinance, sponsored by Commissioner John Elizabeth Alemán.

But given how those same incentives have worked in other cities, lower- and middle-class Beach residents likely won't feel much optimism. The Miami Herald noted in March that the Florida Legislature has squandered $1.3 billion in state housing funds on small, unrelated purchases since the Great Recession, a figure that ought to give everyone who pays rent in Miami a migraine.

Even still, Miami Beach is only now playing catchup to other cities that have been experimenting with similar zoning rules for more than a decade. And there's evidence to show the new rules the Beach wants to implement might also end up being toothless.

According to the Herald, only two affordable complexes exist in Miami Beach, and one hasn't even opened yet. The Barclay Plaza Apartments on Park Avenue targets educators, public safety personnel, and municipal workers making less than $72,500 per year. The second site isn't even being built for workers: It's a complex near Collins Park that's pitched as an affordable space for "artists." (The city has also passed ordinances that look to build affordable units atop city parking garages.)

In addition to amending the plan to budget for fewer units, the city commission will also vote on three new incentive plans to try to help developers turn a profit on affordable complexes. In the first ordinance, Alemán proposes letting developers build much denser buildings than local zoning codes allow — but only if those buildings are priced to house low-earning or workforce tenants. If developers are able to build more units on a certain plot of land, they could theoretically make up the difference in rent or mortgage payments they'd lose if they were to build a standard number of luxury units.

"The density increase allows the City to provide an 80 percent density increase beyond the underlying allowable density to be used only for workforce or affordable units," the ordinance notes. "Additional requirements and restrictions may also be placed within the Land Development Regulations."

Alemán's second ordinance would create incentives for developers to create affordable homes for the elderly. Firms building affordable housing for seniors could build smaller units, a minimum of 400 square feet per space, as opposed to the 550 currently mandated for new buildings. Likewise, homes for seniors would not be required to create any new parking spaces.

Her third ordinance would lay out rules by which the city and landlords can offer "workforce housing." Workforce units would also be a minimum of 400 square feet, and Alemán's ordinance would require the city to set price controls on apartments. "Workforce" tenants would be defined as people making 140 percent of the Miami-Dade County median income, which is currently only $44,000. (That translates to anyone earning less than roughly $61,000.) Workforce complexes would be required to offer affordable units for a minimum of 20 years; after that, they can convert into offering full-priced homes.

But all three zoning-variance packages are voluntary and require developers to submit affordable-housing designs on their own. And therein lies the issue that has plagued the city for decades: Land in Miami Beach is extremely expensive and hard to come by, and developers have found it financially prudent to market condos and apartments to the jet set. The same is increasingly true of downtown Miami and Brickell.

Any new affordable housing in Miami Beach would be a welcome change. But the city commission has stopped short of requiring new buildings to provide affordable units outright, something the Miami-Dade County Commission nearly did last year before that body's developer-tied cadre of old-fart Republicans worried the idea would somehow lead to communism.

“Social engineering is very dangerous,” Miami-Dade Commissioner Javier Souto blabbered when the county commission debated that plan last year, according to the Herald. “This is like handling explosives. You make a mistake, you blow your head off.” Absolutely none of that was true, and similar laws like the one Souto opposed have been implemented in other cities or states without society folding in upon itself.

But after a serious outcry from local developers and wealthy residents in places such as Aventura, the county commission backed off from implementing a plan with actual teeth. Instead, the county and smaller municipalities are now trying to "incentivize" developers to build affordable units, using plans endorsed in a study this week by the National Apartment Association and National Multifamily Housing Council, two trade groups for private landlords. But there's also some evidence that those incentives aren't all that powerful in similar cities.

New York City, the prototype for every other ultra-dense, ultra-expensive American city, has been trying out similar incentive packages in its zoning codes for at least a decade. And city officials have claimed they don't push developers hard enough: New York adopted a nearly identical plan under Mayor Michael Bloomberg in 2005. But from that year through 2013, the inclusionary zoning was found to have been responsible for just 2 percent of the total apartments built in the city in that time period.

Under New York's plan, builders were given extra zoning variances in exchange for choosing to make at least 20 percent of their apartments affordable. Even four years ago, New York officials such as Brooklyn City Council Member Brad Lander and then-public advocate Bill de Blasio (now the city's embattled mayor) argued the voluntary plans weren't working and asked for strict, mandatory affordability requirements. So have scores of advocacy groups such as the nonprofit Association for Neighborhood and Housing Development.

Likewise, Los Angeles, which is mired in its own affordability crisis, found in January that incentive packages were responsible for just 329 new units in six years from 2008 to 2014, according to a report from the Los Angeles City Controller's Office.

Studies have shown that mandatory affordable-housing laws work to create more units than voluntary plans do but are difficult for local municipalities to enact without state or federal subsidies, which certainly won't come from the Scott or Trump administrations. (Economists also worry that without government subsidies, mandatory-housing laws act like taxes on developers and would lead to fewer complexes being built.) Cities including San Francisco, Seattle, and Portland are all moving toward affordable-housing requirements after unsatisfactory experiments with the voluntary kind.

Other housing advocates say increasing minimum wages and improving public transit could alleviate a solid chunk of cities' cost of living. To Miami Beach's credit, the city tried to raise its minimum wage to $13.31 per hour, but Gov. Rick Scott teamed up with Florida's largest corporations to sue to keep the city's wages down.
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Jerry Iannelli is a former staff writer for Miami New Times from 2015 to March 2020. He graduated with honors from Temple University. He then earned a master's degree in journalism from Columbia University.