County, village take small steps toward ensuring that workers can live in the Keys

Thirty years ago, Monroe County was designated one of five Florida Areas of Critical State Concern by the Florida Legislature. In short, the state accused the Florida Keys of irresponsibly handling its growth management issues.

The designation resulted in the Florida Department of Community Affairs requiring every developmental and growth issue to pass through its doors for approval - including any possible legislation for affordable housing.

In local historian Jerry Wilkinson’s “History of North Key Largo,” he stated, “This was supposed to control growth to prevent the Keys from becoming a concrete and asphalt jungle.”

The DCA limited the number of permits allotted for housing in general. Ideals behind the decision were to stop Monroe County’s population from growing exponentially and to prevent the degradation of the land due to an unhealthy abundance of construction.

However, limiting the number of affordable-housing permits limited the number of affordable houses available for the workforce. Because the typical Islamorada employee can’t afford a market-rate home, turnover rates for the workforce became exceedingly high. And limiting employment, in turn, limits production and the success of the economy, according to Dave Boerner, an Islamorada architect and the village’s mayor.

These factors have made affordable housing a convoluted and confusing issue despite its increased importance to Monroe County. It is no longer a situation requiring a quick fix and some Band-Aids.

 Florida State Representative Ron Saunders, speaking at a Lion’s Club luncheon in Key Largo recently, said, “Affordable housing is an oxymoron in the Keys.”

Bruce Horn, who works at the Florida Keys Wild Bird Rehabilitation Center at mile marker 93.6 agreed and said solving the problems with affordable housing was a “long-time coming,” but because Keys officials have a reputation of performing with a “mini-mind,” nothing was done before the situation grew out of proportion. “It’s a real difficult, thorny problem that requires mature management,” said Horn, who owns a deed-restricted affordable house in Islamorada. “You don’t see that in the Keys.”

Horn said his salary was low enough to qualify him for an affordable-housing building permit. According to rules passed by the Islamorada Village Council recently, a moderate-income person -who qualifies for affordable housing - is “one or more natural persons or a family for which the total annual adjusted gross income does not exceed 140 percent of the median annual adjusted gross household income,” which equates to $96,000.

Then in the 1990s, tourism and second-home buyers began flooding the Keys, immediately increasing property and land values. Many Islamorada employees have since been forced to relocate further north where cheaper pastures lurk - that is, Homestead, and even Miami at times. Boerner estimates about 50 percent of the workforce actually lives in the village. The other half travels from other keys or by bus from Homestead to get to work every day. Horn said, “The basic employment infrastructure has been severely impacted by a lack of planning.” Boerner said with all the “catch-22s,” it’s a tough enough feat to build housing in general, much less affordable housing. That, he said, is what the village is aiming to change. “We’re trying to customize for us,” Boerner said. “It’s got to be fair.”

 Identifying the impact

 Velyne Charles works at the Winn-Dixie in Tavernier at mile marker 92. She commutes every day from Florida City, just south of Homestead. “With what I make, I can’t pay half of [renting a house in the Keys],” Charles said. While she can’t afford to live in the Keys on her salary, finding work in Monroe County is easier, and the pay is better than up north, Charles said. To be at work by 8 a.m., she wakes up at 3 a.m. to catch the bus for the ride down the 18-mile Stretch, she said. “I hate the bus, but gas is too expensive.” Charles said she is one of the few people who commute from the mainland and work a morning shift in the Keys. Most of the commuters from Florida City and Homestead work afternoon shifts - and that’s a lot of the employees, she said. Shelby Valles manages human resources and payroll at Holiday Isle Resort and Marina in Islamorada, which has about 200 employees. Valles estimates that about 50 employees commute between Homestead and Islamorada daily.

Rental costs are not the only prices holding back Monroe County employees from moving out of Homestead and into the Keys; buying a home is no cheaper. According to a Forbes.com study titled “The Most Expensive ZIP Codes 2006,” Islamorada was ranked as the 259th most expensive ZIP code in the United States with a 2005 median home sale price of $794,000. There are about 43,000 U.S. ZIP codes. Sagaponack, in the Town of Southampton in Suffolk County on Long Island, N.Y. was ranked No. 1, with a 2005 median home sale price of $2,787,500. Forbes.com ranked the top 500 ZIP codes. Mention of Islamorada to non-Monroe County residents conjures up an image of Millionaire’s Row, and it only makes sense that Home and Garden Television (HGTV) would choose Islamorada as its exotic dream home location.

Since 1997, HGTV has built a dream home every year in a different location. The 2008 dream home - worth more than $2.5 million - is being built just south of Founder’s Park. With million-dollar homes being added to the market at a faster rate than affordable housing, the issue only looks bleaker when the median income in Islamorada is brought to attention - about $61,000, according to Boerner.

Residential obstacles

 “[Getting affordable housing is] like pushing boxes up a 45-degree hill, and they’re loaded,” said Bill Samples, a 25-year veteran fisherman of Key Largo. Samples, who said he thinks getting an affordable-housing building permit is easy as long as you know what you’re doing, bought a piece of vacant property in Key Largo in December of 2003. Although he said he is being considered for a building permit in the upcoming weeks, he calls his attempt to get one a “stalemate.” He had to overcome several obstacles in the process, including lawsuits, county confusion and a change in the Rate of Growth Ordinance or “ROGO” system.

The ROGO system is designed to award building permits to applicants whose plans meet criteria for environmental protection, housing density and structure size, among other things. Permits generally go to applications with the highest scores. An application can earn extra points for building a home that meets the “affordable housing” definition.

Receiving an affordable-housing building permit requires the owner to accept a deed restriction. Specific deed restrictions vary in Islamorada and Monroe County, but generally limit the selling price and the buyer’s income.

Building permits in the Keys also have been delayed by a federal lawsuit filed in 2005 by environmental groups that wanted to limit building on properties that have endangered species habitat. Samples said he was required - along with thousands of others property owners on the list of affected lots - to wait at least another year for consideration. Before the lawsuit held up his permit, Samples said he had to deal with a significant amount of county red tape. Before the incorporation of Marathon and Islamorada, Monroe County was the only permitting authority (outside the cities of Key West and Layton). Now, Keys property owners face building and affordable-housing rules that differ among the municipalities and Monroe County. Once the Keys were designated an Area of Critical State Concern, people wanting to build houses had to compete for a limited number of building permits.

According to Paul Turick, a permitting consultant who owns Paul’s Permits and who built his home with an affordable-housing permit, Islamorada and Monroe County can’t keep up with the demand for building permits.

 Tiffany Stankiewitcz, senior technician of planning in Monroe County’s Middle Keys office, estimated the county granted 12 affordable-housing permits over the last year. She said there were about 56 applications for those permits.

In Islamorada, the recent demand by those willing to accept affordable-housing permit restrictions did not exceed the permit supply. This spring, the village granted all 10 applications it received for permits to build affordable housing. The supply and demand equation could change in the future though. After four years, a property owner whose building permit application has not been approved becomes eligible for “administrative relief.” At that time, the county or city must issue a building permit or purchase the land. The administrative relief process is part of the county and Islamorada’s land development regulations Boerner said the village now has two administrative relief cases. In 2008, there will be 26 permit applications past the four-year deadline, and in 2009 there will be 48. Because permits granted as administrative relief are deducted from the total number of permits available, if too many people line up for administrative relief, permits for building affordable housing could dry up. “In a downward spiral, that would be the worst case scenario,” Boerner said.

Obstacles and objections

The major affordable-housing project the village has undertaken on its own hasn’t yet broken ground. The project site is the former tennis club property called Wet Net at mile marker 81. A lawsuit that began in 2006 has prevented the start of construction, Boerner said. In 2006, after almost two years of negotiations between Islamorada and the property owner, Mile Marker 82.7 Realty Trust, the Monroe County Land Authority bought the four-acre Wet Net site from Bill Fountain of the Realty Trust for about $1.6 million — $3 million below its appraised value. The land authority then turned the land over to the village. The village’s goal is to build 52 housing units priced to be affordable for workers at Wet Net. But four neighboring individuals have sued the village, claiming they are “concerned about density, traffic, parking, buffering and other issues related to a development of that size,” as reported in a Dec. 14, 2006 article in The Reporter. The lawsuit plaintiffs are denying NIMBYism (“not in my backyard”), but they are millionaires, and they believe having affordable housing nearby tarnishes their area, Boerner said. “I’m tired of playing passive with it,” Boerner said. “It’s NIMBYism.” Islamorada village attorney Nina Boniske said Islamorada is planning to build less than the maximum housing density at Wet Net. About 60 units could be built on the site under the current zoning, she said. Assistant village attorney John Quick said the civil suit will have a hearing on September 14 when the village hopes for a summary judgment. “We’re vigorously defending the village,” Quick said. Boniske said, despite the pending suit, the village has the right to begin building whenever it wants. “The village owns the Wet Net; we have a deed; we can build on it,” she said. Legislation, new and old In response to the loss of some of the most-affordable housing in the area, Islamorada’s building regulations were changed to identify mobile home parks as sites for affordable housing.

 In 2004, a number of parks in the Upper Keys served their residents with eviction notices. Park owners hoped to sell land for redevelopment as luxury housing. “Every time you think you have something figured out, there’s a loophole,” Boerner said. The prospect of losing every mobile home park to luxury redevelopment prompted the council to place a moratorium on such redevelopment. The moratorium remains in effect.

One attempt to break the moratorium came in 2005. Residents of Seabreeze Trailer Park, on the ocean across from Founder’s Park, complained to the Village Council about deterioration of the park. Residents claimed that the owner, Joe Wieselberg, was intentionally allowing the park to deteriorate so residents would leave. Wieselberg and his company, Seabreeze Associates, had lobbied for approval to redevelop the 100-unit trailer park into an upscale RV park. Residents said they had offered to buy the park from Wieselberg to save their homes from redevelopment, but he turned them down. Wieselberg said residents never made him an offer.

 Recently, the Monroe County Commission followed Islamorada, imposing a new six-month moratorium on trailer-park redevelopment. The moratorium stops the county from issuing permits and accepting applications for redevelopment or conversion of mobile-home parks. A previous freeze on redevelopment of the parks ended in May 2006. That year-long moratorium spawned an ordinance that requires 30 percent of any redeveloped park to be affordable housing.

Setting affordable prices

As for building an affordable house, requirements are extensive, especially considering the recent move by the village to implement new rules regarding deed restrictions. Islamorada recently defined and revised rules for deed restrictions placed on housing that is built with an affordable-housing building permit. Deed restrictions recorded before 2007 are not affected by the changes, however. The older deed restrictions have a cap on the allowable monthly rent or mortgage payment as a way to keep the housing available to lower-income workers. The restrictions remain in effect for 20 years from the date the deed is recorded and then expire. But Islamorada’s previous deed restrictions did not limit how much such housing could be resold for. In theory, people with substantial savings could make large down payments and qualify for mortgages that meet the monthly limit, but sale prices could rise above what most people consider affordable. Restrictions enacted this January cap selling prices of “affordable” housing, based on number of bedrooms. The deed restrictions last, in effect, forever.

For a one-bedroom unit, the maximum sale price is now $228,750. A two-bedroom is capped at $259,250, and a three-bedroom is capped at $289,750. Another rule required that affordable housing be built at a lower density than allowed for market-rate housing. Boerner gave an example of a site at which the area available for building might be reduced by 2,000 square feet for each unit. Now, however, Islamorada has eliminated the density reduction and actually increased the allowable density to double that of market-rate housing. The change allows for more units per site, but Boerner said this doesn’t affect buffer or setback requirements. Now, while a maximum of six market-rate homes are allowed per acre, the number is extended to 12 units per acre for affordable housing. Boerner said he even aims to have a higher capacity, as the city of Marathon allows 20 units of affordable housing per acre.

Encouraging worker housing

Most recently, Islamorada gave initial approval to a so-called “inclusionary zoning” ordinance that would require any new project or redevelopment to build housing for employees. Boerner said this legislation aims to make it possible for about 70 percent of the workforce to live in Islamorada. The ordinance includes three possible scenarios for employee housing, with the choice up to village officials. The preferred option is for housing on site, which would allow a business to collect rent. Onsite housing benefits businesses because it can reduce employee turnover, officials said. If a business can’t build on its property, deputy village manager Ed Koconis said, he would ask the owner to buy more property on which to build workforce housing. He said he would be hard pressed to make any exceptions, even if a business claims the new project won’t impact the economy or require new employees. Last month, Koconis told The Reporter, “I’m not going to make [avoiding onsite housing] easy on someone. It will be a burden on [the business] to prove they can’t fit the housing.” The last option, Boerner said, is the least desirable. Business owners who redevelop and can’t provide any worker housing would be required to pay a fee to the village that would be equivalent to the cost of the required housing or land. “The last thing we want is money or land,” Boerner said. By passing this ordinance, “government can enable, but government can’t do.”

Steve Kurutz, owner of the Drop Anchor Resort and Marina, is considering expanding his resort. He said he believes parts of Islamorada’s rules on worker housing will change. Although the ordinance would require him to build housing, he said, “All hoteliers realize the need for affordable housing to a point.”

 One project underway

After several years of deliberation and discussion, Islamorada has begun work at Wood’s Corner, a corner parcel across from Coral Shores High School near mile marker 90. Wood’s Corner is slated to hold 16 affordable housing units, expected to be completed around the end of the year, according to Deb Gillis, chair of the Village Affordable Housing Advisory Committee. Rick Casey, Middle Keys Community Land Trust administrator, said about 30 people have applied for housing at the site. Advertising for the project will begin in the next several weeks. “Projects similar to this have had certainly greater than 100 to 200 applications,” Casey said. “Over 495 income-eligible homeowners are within 10 miles of the Wood’s Corners.” Eight of the 16 units are reserved for low-income residents. The low-income definition depends on number of people in a family, but Casey said the income limit is generally under $50,000 a year. The other eight units are reserved for moderate-income families - which also depends on the number of family members, ranging from $50,000 to $80,000 a year. Units for low-income families will sell for $130,000. The homes for moderate-income families will sell for $190,000, Casey said. The main differences in the units are sliding-glass doors and decks off the backs of the homes with the higher selling prices.

David deHaas of deHaas Consulting and Design also has proposed converting the Islamorada Motel at mile marker 88 on Plantation Key to affordable housing units. In a presentation on the project slated to go to the Village Council Thursday, deHaas proposes replacing the 13 motel units with 13 affordable housing units and one market-rate unit. Boerner said he’s pleased with the progress the village has made on affordable housing issues.

 In 2003, a report by DCA suggested that Islamorada needed to build more affordable housing faster. Boerner said the council may finally counter the belief that “The Village of Idiots” — a derisive term applied to the council — can’t solve affordable housing problems, Boerner said. “We’re breaking new ground here,” he said. “I’m happy with what we’re doing.”