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Phoenix commits $70.5 million to affordable housing, homeless services

Phoenix just received $198 million from the federal government and $70.5 million will address homelessness and affordable housing. 

The funding comes from the city’s second installment of COVID-19 stimulus funds, formally known as the American Rescue Plan Act.

The largest chunk — $26 million — will support leasing a hotel, buying a hotel and operating small emergency shelters — all in partnership with nonprofits offering help for things like health care and employment. 

When it comes to new shelters, Mayor Kate Gallego said people in Phoenix deserve priority, “I think as we cite facilities, if we can show to our neighbors that it’s making – lessening impacts on their neighborhoods that will only help get more support.” 

On Tuesday, the council also earmarked $16 million to keep a new shelter at 28th and Washington streets open for two years, in partnership with Maricopa County.

“The Washington Street shelter was a perfect example of the city and the county coming together, instead of pointing fingers at one another,” said Jeff Barton, city manager. “We all have to work together to solve this because it’s not a Phoenix only problem, so we’ll continue those conversations as well.”

The $70.5 million is expected to be used this way:


  • $12,000,000 Affordable Housing Program Pending federal guidance, continue to explore possible ways to create and preserve more affordable housing by providing gap financing to developers.
  • $5,000,000 Community Land Trust Program Pending federal guidance, continue to explore funding an all-inclusive (acquisition, housing development, rehabilitation, down payment assistance and administrative costs) Community Land Trust. 

Human Services

  • $4,000,000 Landlord Incentive Program Continue Landlord Incentive Program with $2,000 incentive payment as executed by Housing Assistance Payment contract. Human Services 
  • $26,500,000 Homelessness Projects Proposal includes three major components: lease of hotel operated by a nonprofit for bridge housing, includes wraparound services; Purchase hotel for long-term housing, including wraparound services; operate pocket emergency shelter in partnership with a nonprofit, including wraparound services.
  • $16,000,000 Heat Response/Temporary Shelter Provide temporary shelter and wraparound services for people experiencing homelessness. This program will partner with Maricopa County to enter into a lease agreement for a building and begin by providing critical heat relief and additional wraparound services for up to 200 people this summer and continue the program for at least two additional years.
  •  $6,000,000 St. Vincent de Paul Transitional Housing Project Provide funding to St. Vincent de Paul to build 100 new transitional housing beds for people experiencing homelessness in the city of Phoenix. The facility will include wraparound services to remove barriers to end homelessness. Maricopa County is matching funding for capital costs.
  •  $1,000,000 Homeless Youth Reunification Program Connect youth experiencing homelessness with housing and social support needs. The program will allow youth to be reconnected with family/friends, pay for housing deposits and other move-in needs and unexpected barriers that prevent youth from exiting homelessness. 

A breakdown of how Phoenix has spent American Rescue Plan Act funds on vulnerable populations is  available on the city's website

Since COVID-19, city leaders have prioritized using local and federal dollars to expand community outreach for people experiencing homelessness, supporting nonprofits that specialize in vulnerable populations and providing financial incentives to landlords and developers to accept low-income tenants and build housing for lower-income residents.

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