D.C. Defends Paying People to Live Near Work
After I expressed skepticism (shared by Matt Yglesias) about the value of the Office of Planning's $200,000 pilot program to match employer grants of up to $6,000 for people who move close to where they work or close to transit, the Office of Planning sent over some reasons why it's a good idea. Here's what they said:
- Live Near Your Work programs exist throughout the country. Two programs we researched include John Hopkins along with 17 other employers in Baltimore, Maryland and the University of Chicago in Illinois...Similarly, the state of Maryland is also offering special mortgage products for the counties affected by BRAC base expansions.
- Over two thirds of jobs in the District are held by non-D.C. residents. Some employers have informed us that anywhere from 73% to 96% of their employees live outside the District.
- Housing close to work often can be more expensive than farther away, depending upon the locations. However, living farther away from work, particularly outside of D.C., can double or triple a household’s transportation costs. This depends on how much they drive and how many cars they own to serve the household’s daily needs. Unfortunately, no mortgage lending products take into account a household’s potential transportation cost savings and allow the buyer to afford more when the home is close to the buyer’s employer, or otherwise reduces their transportation costs.
- Some D.C. employers subsidize employee parking upwards of $10,000 over a five year period. LNYW is an alternative that can provide longer lasting benefits to both the employer and the employee.
- LNYW is one of the first programs of its kind offered by the District that asks participating private employers to contribute and leverage its dollars toward assisting an employee in the purchase of a home. The other existing home-buying assistance programs in the District, such as the Home Purchase Assistance Program, use only local or federal funds.
- Finally, the program is a pilot because we want to examine who benefited from the program and how they benefitted. The intent is to collect information on the 30-60 households and how this program affected their commutes and transportation costs. The program would only be continued and expanded if the study is able to measure the program’s benefits and resources are available.
OK, all fair points, especially if D.C. can get employers to use funds they might otherwise spend on parking subsidies. But my main takeaway is that this is less of a "live near your work" program than a "live in the District" program–because D.C. benefits exponentially more from having someone move here from Maryland or Virginia than it benefits from having someone move from one part of the District to another. It's basically like the $5,000 homebuyer tax credit, except not just for first-timers, funded through OP's capital budget instead of a straight federal tax credit*, and also matched by the private sector.
Here's the thing: Living in the District is already attractive. By and large, the problem is affordability, not motivation, and $12,000 is a drop in the bucket when it comes to buying a half million dollar house (the people to whom it would matter most are likely renters anyway). The best way to get people to live near where they work is to help create affordable housing, and the best way to get people to live near transit is to make transit an excellent service. The places where affordability isn't as much of a problem–say, around the new Department of Homeland Security headquarters at St. Elizabeths–$12,000 might make the difference between buying a house or not. But the bigger obstacles are crime, schools, walkability, and public spaces that people find essential to their quality of life.
Anyway, I'm open minded, and will be interested to see the results.
* Corrected from "locally-funded," which is not precisely the same thing as capital funding, which comes from a variety of sources.