May 1, 2006

With unanimous approval, the Miami Commission April 6 approved Miami Mayor Manny Diaz’s proposal to create Miami’s first Employee Assisted Housing Program. The program, understood also to be an historic first for the South Florida metropolitan area, will provide critical downpayment assistance to municipal employees in the amount of $25,000 towards the purchase of a home in Miami.

Diaz has created the initiative to provide a new incentive for his city’s employees to live where they work. Modeled in part on the efforts of other cities around the country that encourages employees to live in the city where they work so they are closer to their jobs. The program also responds to the dramatic rise in housing costs in recent years in Miami. The local economy has grown. Measures nationally have included downpayment and closing cost assistance, as well as programs to assist city employees with home improvement financing.

The program is anticipated to have a significant local economic impact in Miami. In addition to the shorter commutes with lower associated costs, other benefits include tangible incentives for neighborhood revitalization, and a stronger sense of community ownership from city employees. Employees who currently rent in the city are also eligible. Vested community stakeholders is an important objective of the initiative. Eligible properties include single-family units and condos in Miami with a maximum sales price of $300,000. The employee’s household income may not exceed 150 percent of the area median income adjusted for family size.

‘’Affordable housing is a challenge,’’ said Diaz. ``Particularly, it is a challenge for many of our first responders – police and fire.’’

The rising cost of housing in the Miami metropolis has created an extensive and widely recognized long-distance commuting phenomenon in South Florida. Many firefighters and police commute up to 150 miles or more daily.

The program has been well received by Miami’s first responder community. In response to news of the program Miami Firefighters Union President Edward Pidermann has said, ‘’If it helps even one of my members, it’s a good thing.’’

Funded by Miami’s Affordable Housing Trust and administered by Miami’s Department of Community Development, the Downpayment Assistance Program will initially target as many as 100 employees at a cost of $2.5 million. The loans are termed at 10-years with 0 percent interest and are forgivable if the applicant remains employed by the city.

With this in mind, an objective of the program is that an employee keep the home for at least ten years. If the employee remains employed by the city for those ten years then the downpayment will be forgiven. However, if the home is sold before ten years elapses, the city will receive a share of the profit from the sale of the home. The earlier the sale then the bigger the share of the profit that goes to the city. The higher of the full loan amount or the profit will be due to the city if the home is sold within the first three years. Employees that retire before ten years have elapsed will be treated as employees and will maintain eligibility.

For more information on Miami’s Downpayment Assistance Program for City Employees, contact Lisa Martinez, Director for Policy and Legislation, 3500 Pan American Drive, Miami, FL 33133 Tel: 305-250-5323, or visit the city’s website at www.miamigov.com/communitydevelopment