Helping City Workers Live in the City

"Cities, counties and school districts are starting to offer housing incentives to attract -- rather than force -- their employees to live where they work. These new benefits are particularly prevalent in expensive areas where lower- and middle-income employees are being priced out of the housing market," report Katherine Barrett and Richard Greene.

Fairfax County in Virginia, for example, provides housing in a 270-unit apartment building near county offices to employees. San Antonio is using a different strategy by offering zero-interest loans to workers who want to purchase homes downtown and in the city.

"Although these housing incentives draw more public employees to live where they work, the gains are limited by what the municipalities can afford," note Barrett and Greene. In addition, the demand has far exceeded the supply, they say.