SANTA FE, N.M.
Santa Fe, long known as “The City Different,” is pioneering a novel approach to its affordability crisis: it is becoming the first city in the United States to directly tie its minimum wage to the cost of housing.
The new ordinance, approved by the city council, aims to prevent the cultural erosion that occurs when workers are priced out of the city. Starting in 2027, the city’s minimum wage will be calculated using a unique blended formula: half based on the traditional Consumer Price Index and half on fair market rental data, with a 5% annual cap.
“The purpose is to make a serious difference in assuring that people who work here can live here,” said Mayor Alan Webber. He described the policy as a defense of the city’s diversity, which is threatened by median rents far above other New Mexico markets.
The move comes as rising housing costs squeeze households nationwide. The policy is designed to help the approximately 9,000 workers—about 20% of the city’s workforce—who earn minimum wage. For people like Diego Ortiz, a 42-year-old construction worker and lifelong Santa Fe resident, the change could be transformative.
“If there’s economic stability where we can get a good wage… then we’re going to be able to pay our rent, pay our bills,” Ortiz said, explaining the constant stress of choosing between rent and groceries.
While experts hail the wage increase as a crucial step, they caution that it doesn’t solve affordability for all vulnerable groups, such as seniors and people with disabilities who are not in the workforce. Nonetheless, Santa Fe’s “City Different” experiment is being watched as a potential model for other cities grappling with similar crises.
By James Kisoo
