The Phoenix City Council approved a $12 million financial assistance program to provide monthly stipends to families for 12 months.

The money comes from the federal American Rescue Plan Act (ARPA). Phoenix received $196 million from ARPA this year and expects another $196 million next year.

The program is expected to provide 1,000 families a monthly stipend each of $1,000 for 12 months with no restrictions on how the money can be spent.

A report to the City Council said:

“Across the country, the pandemic exacerbated structural inequities and disproportionately impacted low-income communities and people of color. Many cities are planning to use ARPA funding to provide a fixed monthly amount to qualified residents to provide a greater financial stability and improve quality of life in their communities.”

During Tuesday’s council meeting, Vice Mayor Carlos Garcia said, “We’ve seen a lot of cities across the country doing this direct assistance. I’m glad that we’ll be joining them and giving money directly to folks. That it’s not just for rent and utilities, but if they do have childcare needs or they do have, you know, have to get medicine-whatever it is. I think people know best what their needs are.”

Councilmen Sal DiCiccio and Jim Waring voted against the program.

The council approved the following proposal based on staff recommendations:

• Provide 1,000-2,000 households a $500-$1,000 stipend for 12 months, beginning January 2022, if not sooner.
• Households must be at or below 80% Area Median Income, which for a family of four is $63,200 (this is considered gross income, or also known as pretax income).

Households that have applied to the Emergency Rental Assistance Program and/or residents of city-owned public housing properties, including residents with Section 8 vouchers, will be chosen via a lottery system.

• Participants will receive monthly funds via a debit card and will be able to purchase items with a few limitations, such as no alcohol, tobacco or lottery ticket purchases. The card will be declined for such purchases.
• Participants must agree to allow general purchasing information to be shared with the city to track and report on the progress of the program, as encouraged by the U.S. Treasury.
• The city is requesting a contract be executed with a firm that has experience administering similar programs.

The city is currently exploring options with vendors as well as with Chase to use the City's Master Custodian Agreement and review whether it is possible for Chase to administer the program.

Based on the first year of results, staff would recommend to continue this program, along with any necessary program changes, with the second allocation of ARPA funds in calendar year 2023.