A long road home: As housing program stagnates, Hilton Head workers bear consequences
In 1980, Lois Liptak arrived on Hilton Head Island as a young nurse to work at the hospital.
She soon encountered a troubling Catch-22, she said. Wages were lower here than up North, but housing costs were higher because it was a destination island.
“[The hospital said], ‘Oh, you live in a resort, what do you expect?’” Liptak said. “When it comes to payment, you live in the South, it pays less. When it comes to renting a place, we charge more because we’re a resort.”
The nurses could not afford to live by themselves, Liptak said.
Forty years later, Liptak, now a medical masseuse who owns her own body contouring practice and lives on the South End, says that while the population has skyrocketed, the housing situation has not improved. Liptak, who is legally blind, gets to work, appointments and the grocery story with rides from Palmetto Breeze, but the heavy congestion slows down her commute and makes it more dangerous for her to cross the street.
Liptak said Hilton Head needs more affordable housing and robust public transportation. But she is also seriously concerned about the pressure that development is placing on the island.
“How much structure can you possibly put on this place?” she asked. “We’ve got a lot of stuff on this island that we never had before. I’m all for progress, but I think we’re also in the situation of progressing to the point where there’s so much traffic, it’s horrendous.”
It’s a dilemma the town’s leadership is reckoning with as it attempts to chart a path forward for its nascent workforce housing program, under the interwoven pressures of a growing population, worker shortage and commitment to preserving the island’s luxury aesthetic.
Over the past month, town council has heard two updates on its workforce housing initiative. During the first one, April 19, council members learned that the initiative — for which staff originally proposed eight strategies to increase the supply of affordable housing in the area — had not received any applications from developers or property owners. Town staff clarified that several developers had inquired about both initiatives, however.
To some on council, that the workforce housing program had made little progress in the five months since it was approved was evidence of the council’s drift from the ambitions of the early proposals and the insufficiency of the current ones. The current program offers developers extra density if they agree to build workforce housing. It also permits conversion of vacant commercial property into workforce housing.
“We talk,” said Ward 3 council member David Ames at the April 19 meeting, “but we don’t make a serious commitment.”
Other council members said Hilton Head might not be the place for workforce housing after all, or at least not to the scale necessary to fill the need. Some were hesitant about other workforce housing strategies, including participation in a regional housing trust fund, and said the town needed to do a better job marketing its density bonus and commercial conversion programs.
Mayor John McCann, long a critic of using public money for workforce housing, proposed a referendum this November asking voters whether they should be taxed more to subsidize workforce housing on the island. He said he would put the idea on the council’s May 4 agenda.
But at Monday’s workshop, several council members, including Alex Brown (Ward 1), Glenn Stanford (Ward 6) and Tamara Becker (Ward 4), said they were skeptical of a referendum.
“I am very dubious of a tax referendum on this island to provide workforce housing because of the immediate screams of outrage that I’ve heard from citizens,” Stanford said. “I haven’t heard a single citizen that favors that. ... I think we’ll be successful here with public/private partnerships.”
Council seemed to come to a consensus that town staff, council, developers and consultants needed a business plan that charts a path forward.
In the meantime, the town indicated it would workto recruit developers to the current programs. Shawn Colin, the town manager’s senior adviser, presented a marketing strategy for the initiatives, including hosting virtual conferences and posting on social media.
“There’s a general awareness of the programs we’ve adopted, but not enough education has been done to understand the different nuances,” Colin said.
As the town leaders find themselves at a crossroads, it’s the island’s workforce that feels the effects of the affordable housing drought most. At the end of the work day, those who cannot afford to live on the island await a long trip home.
A high price to pay
Beaufort County’s accommodations and food services industry employs more workers than any other industry in the region, according to 2020 Department of Employment and Workforce data. But the accommodations industry also has the lowest average annual wage, $25,012, of all industries in the area.
The town’s own workforce housing needs assessment, completed in 2018, estimated median rent on the island to be $1,114, and that 40% of all Hilton Head households — 36.8% of homeowners and 49.4% of renters — were cost-burdened, spending 30% or more of their monthly income on housing.
“When individuals and families spend a disproportionately high share of their income on housing, there can be too little left over for other necessities, including food, health care, transportation and clothing,” the study noted.
Renting off-island is cheaper, but not by much. Housing and Urban Development estimates residents in Beaufort County need about $1,056 a month in 2021 to rent a basic one bedroom and pay utilities. A hospitality worker in the county making the $25,000 average annual wage would be “severely cost burdened,” having to put more than 50% of their income toward housing costs.
Simply put, the average hospitality worker cannot comfortably afford to live on Hilton Head Island — or even in the county. This has consequences for the local economy.
Ryan Larson, spokesperson for Southeastern Entertainment Restaurant Group (SERG), said many workers are leaving Hilton Head for more affordable housing and well-paying jobs in Bluffton — further squeezing the island’s workforce while building up the growing riverside town.
“Obviously, if there’s that option where employees could make the same, if not more, money in Bluffton and not have the commute, then obviously I think that’s going to be their first choice,” Larson said.
SERG employs 1,200 restaurant workers across Hilton Head Island and Bluffton. Larson said 60% of them now live off-island — “a complete reversal” of the proportion four or five years ago. The average SERG team member makes $15.20 an hour, according to the company’s website, just over double the federal minimum wage of $7.25 (South Carolina does not have a minimum wage law of its own).
Larson declined to comment on SERG’s starting wage.
Hilton Head Island, which was once entirely populated by the Gullah people — African American descendants of slaves — has seen development take off over the past several decades as the area has become a destination for retirees and well-to-do families.
That’s played out in new ways in the past year with the pandemic’s work-from-home flexibility, as many families have made Hilton Head their permanent residence. Real estate agents report buyers competing for homes as inventory plummets and prices skyrocket. That’s made the island even less affordable for working families.
“The more and more that land becomes very scarce, the more and more that we approve developments that are not for people who are working on Hilton Head, the more and more chance [land won’t be available for] those working families ... who want to make Hilton Head their home,” Brown said at the April 19 meeting.
In Jasper County, the cost of living is much lower. Residents there can expect to pay about $813 a month to rent a basic one-bedroom and pay utilities, HUD data shows.
“It’s cheaper to find a space for my mobile home in Ridgeland,” said Ana Zacarias, whose husband and son commute 1 1/2 hours each way to work on Hilton Head. “In Hilton Head, it’s more expensive, but the jobs are over there. The car, tires, gas, time — it’s more expensive.”
Long commutes
Two years ago, 16 families at a mobile home park on Hilton Head were displaced when the owner of the seven-acre lot sold it to a developer. The residents at Spanish Grove Trailer Park — 14 of whom owned their trailers but rented the land — were given six weeks’ notice to move.
Zacarias was one of the displaced residents.
“We didn’t have enough money to pay for the land, to move the house, to find a place to stay while we were moving the mobile home,” she said. “It was a very difficult, stressful time.”
One homeowner, Jeannette Galvez-Martinez, estimated moving her trailer to another location on the island cost $12,000.
The Deep Well Project, Community Foundation of the Lowcountry and other nonprofits provided donations and no-interest loans to help the 14 families who owned their homes move. In the end, 10 stayed on the island, one moved to Bluffton and three moved to Jasper County.
Galvez-Martinez now lives on Gum Tree Road and pays $600 to lease her lot per month. She said she has friends who want to live on Hilton Head, but can’t afford it, so they live in Ridgeland and Savannah, where rent is cheaper.
They must commute hours each day for work. Some, Galvez-Martinez said, do not have driver’s licenses and commute knowing they could get pulled over at any second and face serious trouble.
Undocumented immigrants can face especially severe consequences if they drive. An arrest for driving without a license, while not itself a deportable offense, can lead to a deportation if immigration officials are notified. Like most states, South Carolina does not offer driver’s licenses to unauthorized immigrants.
The Pew Research Center estimated there were 10,000 undocumented immigrants in the Hilton Head-Bluffton-Beaufort metropolitan area in 2016. But the estimate comes with a 5,000-person margin of error.
“If they get pulled over by the police, they may have to leave. They’re going to have some trouble,” Galvez-Martinez said in Spanish. “It’s not easy.”
Galvez-Martinez, who works at Whole Foods, believes the solution to Hilton Head’s workforce shortage crisis is better public transportation. Without it, she said, people continue to drive without licenses to get to work.
“I am an American citizen, but the people who are illegal, I believe they are forgotten,” she said. “Others think [undocumented people] can be stepped on.”
What is decent housing?
Whichever approach the town takes to funding workforce housing on the island, that housing’s appearance and function is sure to be contentious.
The cornerstone of any affordable housing project is that it provides safe and decent accommodations to its residents. But what qualifies as safe and decent is often up for debate, especially when it comes to mobile homes.
Critics of mobile homes say they disrupt the aesthetics of the island and are an outdated and unsanitary form of housing. Their defenders say they don’t necessarily have to be outdated, unsanitary or ugly, and that they can provide a reliable source of income to landowners who rent out their property.
Defending mobile homes at the April 19 meeting, council member Brown said, “If we’re looking for a product that works and a price point that works — that’s something that works.”
Becker, the Ward 4 council member, has been more hesitant, saying she believed mobile homes and efficiency units were appropriate in certain circumstances, but not all, and that the island should collaborate with Habitat for Humanity more frequently to help people become homeowners.
“We want these folks who are our workforce not just to come onto the island and clean the dirt out of our corners, cut our grass, make sure that our laundry gets picked up and all the rest,” Becker said at the May 3 meeting. “That’s not all we want these people to do. We want these folks who we are trying to get onto the island to become a part of our community, to build a life here on Hilton Head Island and to give back.”
Council members have also suggested tiny homes — houses 400 square feet or less that have been championed by affordable housing and environmental advocates — as a quick and cost-effective option for workforce housing. But those, too, have faced criticism for not being the most effective use of land and a zoning nightmare.
For people like Zacarias and Galvez-Martinez, mobile homes have been just fine. Zacarias said she would love to move back to Hilton Head Island, where her husband has worked for 14 years.
If only, she says, the rent weren’t so high, and the space available for a mobile home so limited.
This story was originally published May 3, 2021 at 7:00 AM.
