Broward County, Florida – Broward County is contemplating an investment of up to $20 million for the next fiscal year to stimulate the construction of affordable housing units, using taxpayer funds. This forms part of South Florida’s multi-million dollar attempts to combat the ongoing housing crisis. In a similar move, voters in Palm Beach County recently agreed to allocate $200 million towards boosting affordable housing.
The proposed funds in Broward County would serve as “gap financing,” covering the shortfall between the cost of construction and what developers can raise from borrowing. Local authorities emphasize that such a financial subsidy is crucial to stimulate affordable housing projects that might not otherwise be initiated. It is a widely-adopted model for facilitating affordable housing across the nation, according to county officials.
During a budget workshop last week, the $20 million proposal was discussed with county commissioners, offering a glimpse into the final budget they are expected to approve this fall. Should the budget receive approval, property taxes collected from taxpayers in the coming fiscal year, starting in October, would finance this allocation.
Since 2018, Broward has been actively incentivizing property developers to create housing affordable to those with lower incomes. In the previous fiscal year, the county earmarked $14 million for this purpose, with $12 million already expended. This has resulted in 330 rental apartments in Fort Lauderdale, Lauderhill, and Hollywood, according to Ralph Stone, the Director of the Housing Finance Division in Broward County.
For developers to qualify for this funding, they must commit to maintaining these units as affordable for a minimum of 30 years. The term “affordable” is defined by a formula that factors in household size and income, stipulating that housing expenses should not exceed 30% of one’s earnings, as per Stone.
Commissioner Steve Geller voiced his approval for the new funding initiative, stating that “it will go a long way in solving out affordability crisis.” Geller acknowledged affordable housing as one of the most pressing issues in Broward County, noting that if workers are unable to afford living in the county, they can’t afford to work there either.
A recent study conducted by the Jorge M. Pérez Metropolitan Center at Florida International University revealed that the lack of affordable housing is a significant issue for Broward’s employers trying to attract workers. The survey included responses from 224 employers and was conducted from November through to April.
Dr. Edward Murray, the associate director at the Jorge M. Perez Metropolitan Center at Florida International University, described the findings as indicating a “huge crisis” and a “catastrophe”. No city in Broward County is exempt from the challenge of affordable housing. Hollywood, for example, lacks nearly 17,000 units of affordable housing, which may include condos or rental apartments.
In November, Palm Beach County voters also approved a $200 million bond item earmarked for affordable housing, reflecting a similar urgency to address the housing crisis.
The findings of the survey underline the severity of the problem. As housing prices continue to rise, so does the cost of living in areas like Broward County. This creates a growing disparity between incomes and the cost of living, further emphasizing the urgent need for more affordable housing solutions.