How Phoenix plans to spend nearly $300 million in federal COVID-19 aid

The Phoenix City Council plans to prioritize small businesses, housing assistance and protection for city employees with COVID-19 aid money the city received from the federal government. 

Phoenix received $293 million from the Coronavirus Relief Fund, part of Congress' $2.1 trillion CARES Act package. 

The city also expects to receive additional money through other CARES grants administered by federal departments, but the $293 million already arrived in the city's coffers and is ready for dispersal. 

There are some strings attached, however.

The city can only spend the money on expenses directly related to COVID-19 and the money must be spent before the end of year — otherwise it goes back to the government.

The Phoenix City Council voted Tuesday on a plan for about half of its coronavirus relief funds to go to community investments and city-specific needs. It's holding onto the rest of the money for potential future expenses through the year.

Here's how the city decided to divvy up the funds:

Business and employee assistance ($14.1 million)

• $5 million in assistance for small businesses.
• $1 million for small businesses at Phoenix Sky Harbor International Airport.
• $6 million  for businesses with fewer than five employees.
• $1 million for restaurant reopening.
• $2.1 million for arts and cultural programs.

Utility, rent and mortgage assistance ($30 million)

• $20 million in utility, rent or mortgage assistance for families impacted by COVID-19.
• $5 million in utility assistance for businesses impacted by COVID-19.

Distance learning and Wi-Fi access ($1 million)

• Wi-Fi for city public housing so children can access online learning. 
• Expenses related to online city services and remote public meeting access.

Mitigation and care for vulnerable populations ($10 million)

• Homelessness and affordable housing strategy, approved by council last month.
• Expenses related to COVID-19 impacts on domestic violence. 

Food delivery ($5 million)

• Provide food to seniors, schools and food banks.

Better health outcomes and community testing ($5 million)

• Ensure broad COVID-19 testing, especially in underserved communities.
• Assist Maricopa County with contact tracing.
• Acquire public health expertise to help the City council make decisions.

City employee COVID-19 tests ($6 million)

• COVID-19 testing for city employees.

PPE, sanitation and cleaning ($20 million)

• Masks, gloves and other personal protective equipment for city employees and customers.
• City facility and public transit sanitation.
• Extra street cleanups. 
• Increased jail or central booking expenses associated with COVID-19.

Medical and public safety measures ($5 million)

• Ambulance costs.
• Police and fire department response and enforcement of COVID-10 orders or illness.
• Parks and Recreation enforcement of park closure or restrictions. 

Payroll expenses ($19 million)

• COVID-19 sick leave for employees.
• Police, fire, emergency management, human services and parks and recreation employee salaries or overtime. 
• Accounting, management and equity oversight of federal funding.

Telework expenses ($15 million)

• Expenses related to city employees working from home.
• Technology expenses related to remote access to city services.
• 911 telemedicine development.

Public facility retrofit ($10 million)

• $6 million to retrofit employee work spaces and public facilities to allow for more social distancing.
• $4 million to retrofit city buses to allow for more social distancing. 

What happens to unallocated money?

The City Council decided not to allocate about $155 million of the city's coronavirus relief funds on Tuesday. 

About $9 million of the unallocated funds will be reserved to replenish some of the community-oriented expenditures — like housing or business assistance — if the need is greater than anticipated. 

The council is holding onto the remainder for now. 

Each month from July through December, the council will meet to determine whether they'd like to use the funds for other expenses. 

Additionally, the council and city staff are holding out hope that the federal government will loosen its guidance on how the funds can be spent. 

The relief funds can only be used to pay for products or services directly related to the coronavirus. But city leaders across the country are asking Congress to allow cities to use the money to balance their budgets as well. 

With the stay-at-home order in place, cities are losing out on an unknown — but likely substantial — amount of sales tax revenue that they rely on to fund services such as libraries, parks and policing.

Service cuts, layoffs or furloughs are expected in Phoenix if the city cannot use the federal funds to fill these revenue gaps. 

Reach the reporter at jessica.boehm@gannett.com or 480-694-1823. Follow her on Twitter @jboehm_NEWS. 

Support local journalism. Subscribe to azcentral.com today.