A 1-percent surtax on newcomers’ multimillion-dollar homes could fund affordable housing in Florida | Opinion

An increasing number of “One Percenters,” with household incomes of $500,000 or more, are moving to Miami. These are not the usual snowbirds escaping the brutal winters of the northeast, but, rather, escapees from high taxes.

We have always welcomed visitors, especially tourists, but the recent trend of the rich and super-rich buying million-dollar condos and mega-mansions on the water has a downside: It exacerbates our already serious affordable housing problem.

Simply put, every “One Percenter” from New York or elsewhere moving here needs someone to clean their house, do their laundry, deliver their Amazon purchases, assist with their shopping and help take care of their kids.

These service workers. likely minorities from low- or moderate-income households, are the same people in our community who have been devastated by COVID-19 and the ongoing recession — and who stand to be displaced as their neighborhoods are turned over for luxury condominiums..

But, where are these workers serving these new, wealthy residents supposed to live, especially since we already are Ground Zero for the nation’s affordable-housing crisis? Although other big cities, such as New York and San Francisco have very high housing costs, their incomes are proportionately higher. Unfortunately, Miami has one of the nation’s highest poverty rates.

I have always preferred a private, rather than government, fix for social problems. However, it’s time for what I call a “1 on 1”tax: a one-time 1-percent surtax on non-resident One Percenters buying real estate valued at $1 million or more. The funds will go into a government affordable-housing fund.

A Wall Streeter moving to Miami making a half a million dollars or more annually should not mind a $10,000 surtax on a new million-dollar condo on the water. After all, it will help provide affordable housing for critical service workers.

Tom Brady and Gisele Bündchen, who just bought a $17 million home on Indian Creek island, should not mind paying a one-time $170,000 surtax to help provide affordable housing for their future staff and service workers. Neither should their future neighbors, Ivanka Trump and Jared Kushner, who recently paid $30 million for a two-acre lot. That would result in a $300,000 surtax.

But, the really big money people coming here are the hedge-fund and other Wall Street wizards such as Ken Griffin, who paid $95 million for four lots on Star Island. The $950,000 from this proposed surtax, pocket change for billionaires, should not make him flinch, since it is going to such a worthy cause.

The pandemic has taught us that Florida cannot live on tourism alone. It has also reminded us that when there is a big problem, especially hurricanes or other catastrophes, those who bear the greatest burden are the most vulnerable — namely, low- and moderate-income people, especially minorities or seniors.

This “1 on 1” surtax will help provide them with safe and decent affordable housing without providing a tax or other burden on existing residents. This is a true example of a win-win that should be immediately adopted here and throughout the Sunshine State.

I cannot think of anyone who would oppose this proposal other than the One Percenters coming to the Magic City to enjoy our beautiful water and weather in the nation’s newest tax haven.

It is time they paid their fair share to help solve a problem they helped to create.

Kenneth H. Thomas, Ph.D., is president of the Miami-based Community Development Fund advisors.