Santa Fe Implements New Wage Ordinance to Combat Housing Affordability Crisis

Fri Nov 28 2025 01:09:33 GMT+0200 (Eastern European Standard Time)

Santa Fe becomes the first U.S. city to link minimum wage increases to housing affordability, addressing a growing crisis where high rents threaten the local culture and diversity.

In an innovative move to tackle its housing affordability crisis, Santa Fe has introduced an ordinance that ties minimum wage increases directly to consumer prices and fair market rent. Set to raise the minimum wage to $17.50 by 2027, the initiative aims to help approximately 20% of the city's workforce while acknowledging the broader issues of housing supply and the needs of non-working low-income individuals. This policy reflects a commitment to preserving the city's unique cultural diversity amidst economic challenges.

SANTA FE, N.M. (AP) — Known as The City Different, Santa Fe has a rich history of cultural blending that officials are now striving to protect amid rising housing costs. In a groundbreaking measure, the city will become the first in the United States to directly link minimum wage increases to housing affordability. This progressive ordinance aims to mitigate high rents by adjusting wage increases based on the cost of living and fair market rental prices.

Mayor Alan Webber reaffirmed the city's commitment to its workforce, stating, The purpose is to make a serious difference in assuring that people who work here can live here. Santa Fe’s history and culture reflect the diversity of our people, which we are trying to preserve. The aim of this ordinance is not just to raise wages but also to ensure that the city’s unique social fabric remains intact.

As the nation faces skyrocketing rents and affordability issues, Santa Fe is responding proactively. Many households are feeling the squeeze of housing expenses, which have worsened post-pandemic.

Understanding the Ordinance

Santa Fe’s minimum wage is set to rise to $17.50 by 2027. While wage increases have historically been linked solely to consumer prices, the new ordinance will utilize a blended formula that includes both the Consumer Price Index and fair market rent data, reflecting the real-world challenges workers face.

Incorporating a 5% cap on wage increases will help address economic volatility, ensuring minimum wages will not decrease even in years when prices drop. Since the city adopted a living wage policy in 2002, addressing median housing prices has become increasingly urgent.

Beneficiaries of the New Law

Approximately 9,000 workers, approximately 20% of Santa Fe's workforce, will see wage increases as a result of this ordinance. Residents like Diego Ortiz, a construction worker and father, express a need for better economic stability to support their families. "If we can earn a good wage, we can cover our rent, bills, and perhaps even buy a house," he shared.

Efforts to boost wages, while crucial, must also consider diverse groups affected by housing issues, such as seniors and disabled individuals who may not benefit from the wage increases.

Additional Strategies

Experts caution that raising wages alone won't solve the city's housing shortage. In response, Santa Fe is also focused on increasing housing supply through new development projects and affordable housing funding initiatives, including a mansion tax aimed at upscale property sales. Mayor Webber emphasizes the city's need to tackle housing issues comprehensively: Can the people who work here afford to live here? Can we keep Santa Fe diverse? This question resonates deeply with residents as they move forward amidst economic pressures.