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Arizona's biggest homeless services program faces $1.5M shortfall

The state’s largest emergency shelter program may soon have to cut services to people experiencing homelessness. 

Central Arizona Shelter Services, known as CASS, serves the Valley and its biggest shelter is near downtown Phoenix. Thanks to an infusion of federal funds related to the pandemic and recovery, CASS was able to increase its beds from 470 to 650. But, now, cuts could be coming.

“We've had a 56% increase in security costs since 2019,” said Lisa Glow, executive director of CASS. 

Between its adult shelter near downtown and its family shelter, the nonprofit is facing a $1.5 million shortfall this year. Not only because of higher operating costs, Glow said, but because they didn’t get any of the $40 million in grants from the state’s homeless shelter and services fund. 

“We wouldn't be here if we had had that support from the state but there was huge competition and, you know, a lot of worthy projects." — Lisa Glow, executive director, CASS

“We wouldn't be here if we had had that support from the state but there was huge competition and, you know, a lot of worthy projects,” she said.

Glow and CASS’s board president, Bill Morlan, recently appeared before the Phoenix City Council asking for more money.

“We have every intention of going out to private funders, private fundraisers, foundations, other municipalities,” Morlan said.

Vice Mayor Debra Stark, whose district includes a family shelter operated by CASS, issued a funding call to other cities.

“If you don’t want the shelters in your jurisdiction then help us, because I am very grateful for what they’re doing in Sunnyslope,” she said.

In the past three years, Phoenix has earmarked $140 million for homeless outreach, services and shelters. Councilmember Kesha Hodge Washington mentioned last year’s court-ordered clean up near downtown, where hundreds of people had been living in tents.

“I think we all can sit here and agree that we pride ourselves in cleaning up the area around "The Zone" making sure we were able to serve more of our unsheltered population and it would be a disservice for us to have to walk that back and not be able to provide service in the scope we have before,” she said.

Councilmembers agreed to increase the city’s contract with CASS, using $169,160 annually from the city’s general fund for potentially five years. But a bigger financial issue beyond homelessness needs to be addressed, warned Councilmember Yassamin Ansari.

“This is, I think, a looming crisis that we all are aware of but maybe the public is not as aware of,” she said.

Phoenix has poured hundreds of millions into various programs, thanks to federal funding through the American Rescue Plan Act, often called ARPA. Those dollars will disappear by the end of this year.  

“And I’m very concerned about what that means for the future of addressing homelessness and so many other amazing programs that our city has been able to start,” Ansari said.

“This is, I think, a looming crisis that we all are aware of but maybe the public is not as aware of." — Yassamin Ansari, Phoenix councilmember

City Manager Jeff Barton said homeless services remain at the top of the ARPA spending list.

“As you know, for the past couple of months, we've been going through regular and reoccurring exercises to reallocate our ARPA funds to ensure that we maximize those dollars, and to ensure that we spend those dollars where they're intended to be spent by priority," Barton said.

Even after getting $400 million in ARPA funds, Phoenix could find itself itself in a situation like CASS: facing a budget shortfall. That’s because the state is changing the way it shares income tax with cities, and Phoenix will get $36 million less in the fiscal year that starts July 1. And, next year, when cities can no longer collect tax on residential rents, Phoenix will be out more than $40 million.

Meanwhile, Glow said CASS is compiling a list of ways to cover its $1.5 million gap.

“So cutting case management, the four case managers, plus client advocates, would reduce our staffing, which would mean those 600 to 650 people would not be staying in all day, they would leave for six to eight hours a day, which is how we used to do things. And there’s some other things, facilities and things we would cut,” she said.

They have until March 30 to come up with the cash.

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