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Phoenix could buy apartment buildings, shelters to increase housing options

“Go big or go home” is how City Manager Jeff Barton presented some ideas to the Phoenix City Council to address homelessness and the lack of affordable housing.

During Wednesday's council meeting, he suggested using $50 million to buy apartment complexes and offer units to low- and moderate-income residents. 

“The reason it makes sense to acquire existing is because you can’t build it for cheaper,” Barton said.

The money would come from the second payment of federal stimulus funds, part of the American Rescue Plan Act. Phoenix received $198 million last year and expects another $198 million this year. 

Federal rules require ARPA funds be used these ways:

  • Support public health expenditures by funding COVID-19 mitigation efforts.
  • Respond to the public health emergency or its negative impacts on residents and businesses.
  • Respond to workers performing essential work by providing premium pay.
  • To make necessary investments in water, sewer, or broadband infrastructure.

The council already approved $51 million of the expected $198 million to cover premium pay for city employees as well as worker compensation claims related to COVID-19, which leaves approximately $141 million.
During the council meeting, Barton also suggested spending $20 million to buy shelters and transitional housing for people experiencing homelessness. Councilwoman Yassamin Ansari, whose district includes the state’s largest shelter located near downtown, doesn’t think that’s enough.

“Just in the past three months, the number of people outside the Human Services Campus has increased from 200 to 500,” she said.

The preliminary suggestions presented to council include:

  • $50 million: Acquisition of multi-family complexes for affordable and workforce housing. 
  • $20 million: Purchase and operation of shelter/transitional housing for individuals experiencing homelessness, either through hotel conversion or another approach.
  • $10 million: Fund an all-inclusive (acquisition, housing development, rehabilitation, down payment assistance administrative costs) Community Land Trust.
  • $10 million: Provide opportunity for community organizations/nonprofits to access funding for projects related to human services and housing. 
  • $2 million: Continue Landlord Incentive Program and increase incentive payment to $2,000 per executed Housing Assistance Payment contract.
  • $1.5 million: Community-driven planning effort for the Marcos de Niza Public Housing Community to determine redevelopment and revitalization opportunities.

No council member publicly spoke against the housing and shelter ideas. At various times, all members, along with Mayor Kate Gallego, have expressed concern over inadequate housing stock and increased homelessness.
Barton stressed that his presentation was designed to be a starting point for discussions and encouraged council members to continue sharing input with various departments and his office. Based on their feedback, Barton will return to the council with a strategic plan for all the federal dollars. 

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As a senior field correspondent, Christina Estes focuses on stories that impact our economy, your wallet and public policy.