Phoenix has spent almost 85% of its CARES Act funds since receiving a $293 million federal injection last year.
The funds came as part of a $2 trillion stimulus plan known as the Coronavirus, Aid, Relief and Economic Security Act passed by Congress last spring.
Phoenix could receive additional funding under the Biden administration, which is moving forward on finalizing a two-part “rescue plan.”
The city has received an additional $51 million in federal aid to help renters struggling during the pandemic. The City Manager’s Office will present a rollout plan to the City Council next week.
As for last spring’s funding, Phoenix put:
- $90.5 million toward community relief programs, from rental assistance to COVID-19 testing sites.
- $59.2 million toward the city’s pandemic-related expenses, such as retrofitting buildings to equipment to allow telecommuting.
- $143.6 million to backfill projected holes in the city budget as revenue declined in the pandemic.
Phoenix has spent about $245.5 million in total with an additional $8.5 million already committed, Barton said
The council voted in December to allocate its remaining funds to replenish citywide programs and to address shortfalls throughout the year.
Deputy City Manager Jeff Barton estimates that Phoenix will exhaust its CARES Act funds by the end of March, although the city will continue to fund community programs into the summer using its general fund budget.
Here’s a closer look at the city’s spending of the CARES funds.
Small business support
Phoenix has distributed $16.7 million to help small businesses that have been devastated by the coronavirus.
About 2,300 Phoenix businesses, restaurants and concessionaires and 430 artists and arts organizations received funding through various assistance programs, Barton said at a city council meeting on Tuesday.
The council last month allocated an additional $1 million to the program’s original budget after demand for relief exceeded its original estimate. That funding has since been expended.
Councilmember Carlos Garcia voted in favor of the $1 million increase but urged the council to move remaining funds to programs that would directly help residents.
“We should be looking at impact,” Garcia said at the council meeting. “We could add a little bit more to business assistance but I still don’t see it being enough to make a significant impact. It seems like a drop in the bucket.”
Rent, mortgage and utilities assistance
The city has expended $21 million out of $29.5 million to assist residents in paying their rent, utilities and mortgages.
More than 5,400 households received rent support and more than 1,700 received water bill assistance, according to Barton.
Several applications remain in the queue, and Barton expects to exhaust the program’s funds by the end of March.
In December, a federal court judge ordered Phoenix to open up its rent and bill assistance program to undocumented immigrants and other non-U.S. citizens who initially were excluded from the program.
The court ruled that residents without legal U.S. status qualified for the emergency relief provided through the CARES Act.
The council injected an additional $3.3 million into the program following the ruling.
Viri Hernandez, executive director of Poder in Action — which filed suit against the city — said that the additional funding is not enough and that the program was opened to undocumented immigrants too late.
“The city needs to prioritize and create a fund specifically for immigrants and specifically because of the harm that was created when they were initially excluded,” Hernandez said.
Health and COVID-19 testing
Phoenix has allocated $13.4 million to community testing events, such as mobile testing and weekend pop-ups.
The city also funded personal protective equipment for schools and surgical masks for the community.
Arizona has become a global hotspot for coronavirus, with among the highest rates of new cases in the country for most of January.
As coronavirus cases in Arizona spiked, Phoenix City Council voted to reprogram an additional $5.5 million to the program’s original budget.
Other community programs
The city pledged about $21 million to refugees, senior citizens, U.S. veterans, unemployed residents and other groups left vulnerable during the pandemic. The funds will help to improve senior care facilities, ensure veterans have alternate housing options and assist refugees who own small enterprises, among other projects.
About $6.9 million of federal aid was granted to metro-area food banks to help distribute meals across the city, and $3 million was pledged to improving WiFi in public spaces to facilitate smooth distance learning.
The city directed $59.2 million for costs associated with city operations in the pandemic, such as cleaning facilities, personal protective equipment for staff and teleworking.
The remaining $143.6 million of the city’s CARES Act funding was allocated to a public safety salary offset category to backfill the city’s general fund budget.
Cities could not use the federal funding to replace lost revenue, but they could use the money to offset public safety salary costs. Putting a portion of the relief funding toward those salaries freed up space in the city’s general fund budget to continue funding community initiatives.
Phoenix has tapped into the general fund budget to pay for ongoing projects and city operational expenses which will likely extend into the summer, Barton said.
“We use that public safety salary offset to help us end the grant essentially but then to be able to continue those programs with no timeframe,” Barton said.
Under new guidance, the U.S. Treasury has extended the deadline for cities and counties to spend their relief funds to the end of 2021. Any money that remains by the year’s end will be returned to the Treasury.
Barton is confident that Phoenix will close out its grant far before the deadline.
“We will not give a dime to the federal government because it doesn’t benefit the community or the city for us to give this money back,” Barton said.
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