American Rescue Plan will provide much needed boost for Arizona
The American Rescue Plan Act, passed by Congress and signed by President Biden last week, is a major victory for Arizonans. A year into the pandemic, this legislation provides much-needed relief to struggling households and lays the foundation for a strong economic recovery for Arizona.
This legislation was long overdue for many Arizonans facing hardship— 1 in 3 households cannot afford usual expenses, 1 in 6 are behind on rent, and 1 in 8 sometimes or often do not have enough to eat. Rates of hardship and income loss are significantly higher among households of color, households with children, and households with lower incomes (prior to the pandemic).
The American Rescue Plan Act is a transformative opportunity to invest in communities so Arizona can come back stronger. It is crucial that this new federal relief be distributed as quickly and as equitably as possible. In addition, the Act includes a clause that penalizes states that pursue net tax cuts or reduce state revenues. New net tax cuts would be a double hit to struggling Arizonans by reducing both long-term general fund revenues and much-needed federal aid.
Elected officials should spend these funds now, and not use them to continue to backfill state agency budgets, as Governor Ducey did with the CARES Act in 2020 to create a budget surplus to enable $600 million in new tax cuts. If the Great Recession taught Arizona anything, it’s that recessions—like the current one—are terrible times to pass more tax cuts to benefit corporations and the wealthy at the expense of struggling families.
Responding to the effects of the COVID-19 pandemic and strengthening our state’s fiscal health can build a future where more Arizonans thrive.