'Every challenge creates an opportunity': Miami-Dade budget tries to turn housing crisis into 'win-win-win'
As it does every year, Miami-Dade County is in the midst of setting a budget for the coming fiscal year. But unlike other years, the county is facing a housing affordability crisis that is consistently ranked as the deepest crisis in the nation.
Reacting to this, Miami-Dade Mayor Daniella Levine Cava has proposed a 2022-2023 budget that includes about $500 million in housing programs, including $85 million in new strategic funding to address the crisis.
A new plan announced by the mayor is called the HOMES plan, with each letter standing for a different pillar. About 13,000 new housing units for low and middle income residents are currently in the planning, pre-construction or currently under construction, according to the county’s Housing Affordability Tracker.
Ahead of a community event tonight, Mayor Levine Cava spoke with WLRN’s Danny Rivero about the proposed budget and what it hopes to accomplish for the housing crisis.
In April, the county declared an emergency over the sharply increased cost of housing, an increase brought about in part by the migration of work-from-home employees to the region during the COVID-19 pandemic.
Levine Cava argued this situation could be an "opportunity" for the area. "Truly, it is potentially a win-win-win," she said. "We have more residents that have flocked here, more businesses that have established here and are growing, and more momentum and resources to solve the problem."
And she defended a 1% property tax decrease - which will not lower tax bills for many due to the increase in property values - as "historic".
The in-person budget event with Mayor Levine Cava is being held tonight - Sept. 13 - at the Roberto Alonso Community Center in Miami Lakes, at 6pm. The address is: 16500 NW 87th Avenue. The final county budget is expected to be voted on at a September 20 county commission meeting.
The following interview has been lightly edited for clarity.
RIVERO: When it comes to actually building and developing more affordable housing, what incentives or other programs are in your budget that would help get new projects started or help finish projects that are currently right now under construction?
LEVINE-CAVA: We often have developers who maybe have a property, they've got a design, maybe they've got some money. They're waiting for federal subsidy or state subsidy, and it takes a while to come. The prices have gone up, the supply chain issues, the labor and so on. And so they're sitting there with a project that can't be completed, and we need that housing desperately. So that's why we created the Building Blocks Fund. So there would be the final financing in place.
One of the programs that you're proposing in the new budget would incentivize landlords to bring down rental rates for people in the middle income brackets - for people like firefighters, teachers and prosecutors - by actually putting some money into the landlords' own hands. Now, some opponents say that the proposal is misguided, largely because it's not going to people in the lowest income brackets who are most in need of assistance. How do you respond to that criticism?
It is really important that we help people throughout the income spectrum who are here contributing. There are workers and you know what? They're leaving because they cannot find a place that they can afford to live.
So we are saying to landlords, your units are too expensive for this category of worker, please take our subsidy, make a three-year commitment and bring down the cost of your rent. And we're very excited. It is an innovative approach. It's a pilot and the specific program we're calling it WHIP – Workforce Housing Incentive Program. And we have landlords who've said we will bring down the price, we will open our doors.
You mentioned that this is a pilot program. I'm not aware of other similar programs in other parts of the country. But in effect, what's being proposed here is that the county government fill in the gap to help people pay the rent because the rates are so high.
Is there a risk in doing that of actually propping up the high rental market and keeping the market high?
Well, this is – these are units that could be rented at market rate. There's no lack of demand for these units. So we think it's a real contribution that these landlords are making. All of this will be by contract. The landlords have to apply. They have to demonstrate that they have the units that they're not gouging, that their prices are going down. It will be monitored and they would have to forfeit their subsidy. And we would take back our money if they violated the terms.
You're proposing to use federal dollars to extend emergency rental assistance to struggling renters. And your administration actually has considerable experience in this area during the COVID-19 pandemic. So, what have you learned in the past about how to best make a program like this work moving forward?
The Emergency Rental Assistance Program, or ERAP federal program that started in the middle of the pandemic, has been a lifeline for so many. 23,000 households avoided eviction. We've used $123 million in this federal program.
We've paid the bills for our landlords. Right? They have to pay their bills. We've gotten them the money to pay their bills, and we've stopped our really tragic dislocation and eviction. As soon as we learned about the money, we'd had the eviction moratorium that was based on health reasons and conforming to CDC guidelines, and I'm the sheriff, so it really put me in a great position to be able to control how evictions would unfurl.
Now, part of the HOMES program expands ERAP to people to a slightly higher income level. So that is the innovation. We already know how to use this program. We already know how to be effective in preventing evictions. It was only allowed in the federal program to go to 80% of our area median income. And with this HOMES program, we are moving to 140% of area median income. That would be for a family of four, $136,000. And that is our workforce guideline. And so we're saying: We have money for the lower end. Let's go up to 140% on eviction prevention, and we're very excited about expanding.
You're also proposing mortgage and utility assistance for homeowners who are struggling to keep up with the bills. What would this program look like if it's approved?
Basically, people who are already in their homes, maybe they're on fixed incomes and the price of just staying in their homes is going up. And we don't want those people to lose their homes to face foreclosure. Many of these are going to be elderly or veterans or disabled.
We have mapped the people who are eligible. We know who they are. We plan to go to them directly and offer this assistance if they qualify.
How much has the migration patterns of people moving to Miami-Dade County from other parts of the country impacted how you and your administration think of potential solutions for this housing crisis that we're facing?
Every challenge creates an opportunity. So the challenge of having more people competing for limited availability of housing that can be within reach just creates more momentum for solving the problem, because it's affecting a greater percentage of our population. And we also have more wealth in our community that can be tapped to help solve the problem.
Truly, it is potentially a win-win-win. We have more residents that have flocked here, more businesses that have established here and are growing, and more momentum and resources to solve the problem.
The County Commission agreed to your proposal to reduce the property tax rate by 1%, which is something. But because the property values have increased so much, it seems not very likely that families will be paying less in property taxes. It's just that technically the rate has been reduced by 1%. Why not reduce the rate by some level where families will actually be paying less in taxes?
A [historic] tax break – the first in ten years, lowest millage rate since 1982 – is really not insignificant, even though it might not show up as a lot right now. If it weren't done, then their taxes are continuing to rise. So over time, a 1% tax cut is significant. And, the problem with a lower tax rate is that it's not sustainable. We are looking possibly at a recession.
The housing values – we don't think they'll go down, but we don't think that's necessarily going to continue to grow as it has done. And we are growing as a community. We have to pay for basic services. And looking ahead, it would not be responsible to cut further at this time.
Update: Our final Conversations with Cava event is now happening tomorrow, September 13, at the Roberto Alonso Community Center.— Daniella Levine Cava (@MayorDaniella) September 12, 2022
Join me at 6:00pm to learn more about our proposed County budget. We want to hear from you! pic.twitter.com/yJPI3rKLv6