Provide Affordable Housing for Teachers, Healthcare Workers, & First Responders in Exchange
for a 25% Increase in Home Density

Introduction

Florida is said to be facing a severe housing shortage, driven by rapid population growth and an influx of residents, especially in cities like Miami, Orlando, Tampa, and Southwest Florida. The Florida legislature is considering a proposal that will incentivize developers to increase the number of housing units in certain projects by up to 25% if they agree to offer some units at more affordable prices.

This idea stems from growing concerns about housing shortages and affordability across the state, especially in high-demand areas.

Allowing developers to build more units could help meet the demand for less expensive housing, allowing young teachers, healthcare workers, and other essential workers to live closer to their places of work, minimizing traffic density that would otherwise result. In addition, advocates of “workforce housing” argue that this would reduce the number of workers leaving the area for jobs in less expensive municipalities.

Living closer to one’s place of work reduces long commutes and improves overall quality of life. Workforce housing programs aim to bridge the gap between subsidized low-income housing and unaffordable market-rate options, ensuring that essential workers can find stable rental options.

By requiring developers to offer some units at lower prices or with rent restrictions, the state hopes to balance the increased density with the need for affordable housing. The idea is that developers may be more willing to build more units if they are allowed to offset lower-priced units with higher-priced ones, thus maintaining profitability.

The Details

Several bills have been introduced in the legislature to address housing affordability, including those that offer zoning flexibility or density increases in exchange for the construction of affordable units.

1. HB 337 (2024 Session) – Housing Incentive Programs

This bill is one of the most recent legislative efforts in Florida to incentivize affordable housing development. It would allow local governments to offer developers density bonuses in exchange for commitments to provide affordable housing units. The legislation focuses on:

• Cities could offer developers more buildable space or units beyond typical zoning restrictions if they agree to provide affordable units or reduce rents for certain income levels.
• Developers would need to agree to set aside a portion of their units for renters or buyers with incomes below a certain threshold. This could apply to both multi-family and single-family developments.

While the state sets the framework, individual cities and counties would still have flexibility in deciding how to implement these programs based on their unique housing needs.

2. SB 102 (2024 Session) – Affordable Housing Development

This bill also includes provisions for density bonuses, particularly in urbanized or high-demand areas such as South Florida. Under this bill, developers could receive up to a 25% increase in the number of units they are allowed to build in exchange for meeting specific affordable housing criteria. The details of the affordability of these units may include:

• Offering affordable rents for households earning 80% or less of the median area income.
• Commitments to keep these units affordable for 30 years (or more), ensuring long-term affordability.

Key Factors and Challenges

Even if these bills pass, local municipalities would have the flexibility to adopt or reject the incentive programs based on their unique needs and priorities. There’s some debate around whether this could lead to increased housing stock in some areas while failing to do so in others.

The key debate surrounding these bills is how much of the housing stock should be considered affordable and whether developers will truly reduce prices enough to make a significant difference for low- and middle-income residents. The challenge is also whether local governments will be willing to adopt these measures, as many communities worry about overdevelopment and changes to neighborhood character.

Conclusions

While the legislation still has to work through committees and local government input, the final form of the bill could change. However, the overall goal is to address the severe housing crisis in Florida by incentivizing developers to both build more and offer affordable options. Lawmakers have swept money dedicated to affordable housing nearly every year for the last 20 years, which critics say has worsened the problem.

Senate President Kathleen Passidomo has long advocated for legislation to provide more affordable housing for residents and appears to be gaining support for her plans. “Florida needs more affordable employee housing, and we applaud President Passidomo for her leadership,” Chamber President and CEO Mark Wilson said in a released statement. “Florida’s ability to attract and retain the talent necessary to grow from the 16th to the 10th largest global economy relies on the availability of affordable and attainable housing.¹”

This issue is not specific to parts of Florida. There are many examples of plans and options that have been implemented, resulting in improvements in attracting and retaining the types of workers mentioned earlier.

References.

1. Senate President Kathleen Passidomo unveils affordable housing package. Gray Rohrer. January 26, 2023.