Monroe County commissioners can make all the plans and promises they want to alleviate the affordability crisis in the Florida Keys, as the rental market only continues to rise and workers struggle to stay.
But the five-member panel doesn’t have the authority to grab just any budget line and switch it to a workforce housing fund.
The latest idea: spend $25 million in surplus revenue the Monroe County Tourist Development Council raked in between 2020-2022 to house workers in the service and hospitality industries.
“We could really make a difference and build some workforce housing,” said County Commissioner Michelle Lincoln, of Marathon.
Lincoln believes it’s the right move for the Keys.
“We’re not taking money out of the budget for advertising,” Lincoln said. “And it’s not asking for any more money. We’re not asking to increase a penny sales tax.”
The agenda for Wednesday’s Board of County Commissioners meeting, scheduled to start at 9 a.m. at the Marathon Government Center, once again included the TDC surplus.
The commission was set to take a vote on whether to lobby state lawmakers to craft a way for Monroe to use the surplus for something that’s not on the books.
“We’re asking the state if we could use that to fund workforce housing that especially benefits people in the service and hospitality industries,” Lincoln said.
Long-term rentals in the Keys have become harder to find, let alone afford on average local wages.
Fair market rents for 2024 determined by the U.S. Department of Housing and Urban Development for Monroe County are $1,556 for a studio, $1,730 for a one-bedroom apartment and $2,139 for a two-bedroom.
But in reality, a studio apartment in Key West can easily run more than $2,000 per month and a 646-square-foot one-bedroom at Ocean Walk apartments was starting at $2,781 per month at press time, while a room in a two-bedroom apartment, with a shared bathroom, on Duval Street was listed for $1,500 on Craigslist.
Lincoln is on the Florida Association of Counties, which she said will likely take a vote on the TDC tax surplus spending option idea in November.
Florida law restricts how counties spend the TDC tax money. Elected officials can’t just tap into it for any project, such as rental housing designed to stick to fair market rates or reserved for people with lower than average incomes.
“We have to follow the state statute language as it’s written,” TDC director Stacey Mitchell told the Keys Weekly on Oct. 17.
The Keys scored that bonus $25 million from unprecedented tourism numbers for fiscal years ending in 2021 and 2022. It’s from the total four-cent “bed tax” collected on every dollar spent at hotels and lodging establishments across the 120-mile island chain.
The excess in TDC tax collections ran far over its forecasted budget due to the equally unprecedented number of tourists who poured into the Keys when the COVID-19 pandemic prompted other states, cities and countries to enforce shutdowns as part of safety measures.
Florida was one of the few top destination spots that remained open during a long stretch of the first 18 months of the pandemic.
“We had zero competition,” Mitchell said.
The TDC, an advisory committee for the county commission, uses bed tax revenues to advertise the Keys, promote the largest events and for large building projects that boost tourism.
Commissioners have essentially frozen the line item for special public facilities capital projects.
“They voted to defer accepting applications for the use of these surplus funds until after the 2024 legislative session,” Mitchell said.
At the Oct. 18 meeting, the agenda item that listed the 2024 legislative priorities included the TDC surplus idea.
In a report by Lisa Tennyson, the county director of legislative affairs, 10 major Keys issues made the priority list, including, “Support legislation to expand the eligible uses for Tourist Development Tax-generated funds to include affordable/workforce housing for tourism sectors’ workers.”
It’s tagged as “tourism workforce housing,” in the report.
“We’re not sure if the entire state’s going to be behind us,” Lincoln said. “We’re definitely ready to stand alone on this one.”
Many urgent goals in 2024
The TDC surplus is one of three legislative priorities related to the housing crisis that county staff has compiled, including supporting local governments’ efforts to alleviate housing costs.
The report recommends the county support legislation to enable local governments to offer property tax relief for landlords who “voluntarily rent affordably.”
A property tax break could save long-term rentals from turning into vacation rentals.
But Monroe County’s top priority remains environmental protection, namely to secure $25 million through the Florida Keys Stewardship Act: $20 million for water quality projects and $5 million for land acquisition.
“The county utilizes its share of Stewardship funding for the canal restoration program,” according to the staff report.
The priority list also includes funding for raising roads, addressing marine issues such as mooring fields and removing derelict vessels, and protecting the Rate of Growth Ordinance from possible state preemption.
Most of Monroe’s legislative goals are incremental “and focused on issues that are built upon over several sessions, such as our water quality and land acquisition needs, the importance of wind insurance affordability, and protection of grandfathered vacation rental regulations,” the report states.
A longshot: reducing wind insurance costs
The soaring cost of wind insurance is another piece of the Keyswide affordability crisis. Wind and flood insurance costs are a perennial issue but county staff says this year there’s even more urgency.
Most wind insurance policies in the Keys are through the state-backed Citizens Property Insurance Company, known as the insurer of last resort.
“Thanks to the spiraling property insurance crisis, Citizens’ policy numbers have soared past $1.4 million because it is the default insurer for policy holders from the private sector insurance companies that have failed or left the state,” the report says.
“Lawmakers continue to pressure Citizens to shed policies by forcing insureds into take-out companies with higher premiums, and by limiting eligibility,” according to the report. “Preserving affordable wind insurance requires regular advocacy with Citizens, legislators, and the Office of Insurance Regulation to oppose efforts to increase premiums, eliminate the cap on annual increases, reduce coverage, and reduce eligibility.
“To make matters worse, recent state legislation now requires flood insurance to be carried by all Citizens’ policy holders – even for homes not at risk for flood,” according to the report.
Florida lawmakers passed significant insurance legislation this past year and county staff says it’s unlikely they’ll revisit the issue in any type of comprehensive way.
“Nevertheless, we will work with our delegation and with Monroe’s insurance advocacy group, FIRM (Fair Insurance Rates in Monroe), to press for some reforms that may help to reduce costs,” the report says.
The 2024 Florida Legislature’s session begins Jan. 9 and ends March 8.
