The plan will be financed by the American Rescue Plan Act, the latest $1.9 trillion federal COVID-19 relief bill that Congress approved last March. The city received $196 million from the relief bill and voted Tuesday to spend $12 million of it on the monthly payments, officially called the Financial Assistance for Phoenix Families Program.
"We’re essentially going to pick 1,000 families to get $1,000 [per month] for 12 months," said Phoenix City Councilmember Carlos Garcia. "People know what their needs are, and I think it’s better for them to decide how to use financial assistance rather than us predetermining it."
Low-income families with children making 80 percent of the area median income or less — 80 percent of the area median income for a family of four is currently $63,200 annually — will be eligible for the program, according to city documents. Families that have previously applied for rental assistance and residents at city-owned public housing will also be eligible. Recipients of the monthly payments will be decided through a lottery system.
The payments will be issued on a debit card that families can use to purchase anything except for alcohol, tobacco, and lottery tickets. The cards will be programmed to decline purchases of those prohibited items, according to Jeanine L'Ecuyer, a spokesperson for Mayor Kate Gallego. Recipients of the payments also won't be able to use the cards to withdraw cash.
Councilmen Sal DiCiccio and Jim Waring cast the two dissenting votes on the program.
The city is aiming to start issuing the payments no later than January 2022, though ideally, it will "get these out to folks before the holidays," Garcia said.
There appears to be some appetite at City Hall to extend the program after the initial 12 months of payments. City staff recommended that the council "continue" the program based on the "first year of results."
"I believe this program is going to be really successful," Garcia said. "Hopefully we can come back to it and add more money to it."
The Phoenix City Council's adoption of the program follows similar moves by local governments across the country. Last May, the L.A. County Board of Supervisors approved a pilot program to issue $1,204 monthly payments to 150 young adults for three years. Chicago officials are currently weighing giving 5,000 low-income households $500 per month after receiving federal COVID-19 relief funds.
Phoenix has historically struggled to get federal pandemic relief money out to people in need. Phoenix New Times recently reported that, as of July 19, the city was still sitting on $32 million in rental assistance funds.
Garcia said that families who think they are eligible for the program should contact the city of Phoenix Human Services Department, though he cautioned that the logistics for the program need to be finalized.
"I would encourage folks, if they have the need now, call that assistance line and start asking for support now," he said. "We will roll out the specifics of who and how they will get selected in the next couple of months."