PORTSMOUTH — The city is giving out thousands of remaining gift cards containing pandemic-era financial aid that were purchased three years ago but have gone unused amid investigations into previous distribution processes.
In 2022, city leaders used more than $3 million in federal funding received through the American Rescue Plan Act to purchase $100 and $500 gift cards to be given to seniors and youth impacted by the coronavirus pandemic.
Around 2,000 of the more than 16,000 cards purchased using ARPA funding weren’t distributed, and they’ve sat unused in city offices losing value since then. The gift cards have been at the center of internal investigations from multiple city managers and were reviewed in financial audit conducted last year.
City leaders now have a plan to distribute the remaining 2,003 cards. But instead of pandemic relief, the cards will be targeted to individuals most impacted by negative impacts to the economy like the ongoing “government shutdown, rising inflation, and job losses,” according to the city.
The $100 gift cards were used in the summer of 2022 to incentivize COVID-19 vaccinations among seniors, while the $500 gift cards were directed to qualifying low-income individuals. Another round of $100 gift cards were given to qualifying seniors in 2023.
City officials say the ARPA funding award allows them to target the distribution to residents in need beyond the pandemic. The ARPA funding was received specifically through the State and Local Fiscal Recovery Fund. The city said under that program, local governments are authorized to also address the negative economic impacts of the pandemic, such as job loss, reduced hours, housing and food insecurity.
“Because our gift card distribution is targeted to households that have been demonstrably impacted in those ways, and because the value and form of assistance are designed to respond to that harm in a proportional manner, the program remains wholly consistent with the Treasury guidance and compliant under ARPA,” said city spokesperson Peter Glagola.
But the collective value of the cards has dropped since they were first purchased and activated.
Now the cards are collectively worth an estimated $199,143. The 1,689 cards initially worth $100 are now worth just $37.50, while the 314 cards initially worth $500 are valued at $432.50.
Had they not lost value, the prepaid cards would currently total $325,900.
Despite that, city officials say all funding has met ARPA requirements. Last year, a review of the gift cards and the accounting and procedures used was included in a financial audit conducted by the Brown Edwards firm for fiscal 2023. A draft of the audit report noted no findings.
“The city recognizes that a small portion of ARPA funds distributed through prepaid cards has become unusable over time due to card inactivity. All funding has followed ARPA guidelines,” Glagola said in an email.
ARPA funding was allocated to municipalities across the U.S. in 2021 to provide economic relief and recovery from the pandemic, which could include replacing lost public sector revenue, addressing public health and economic impacts, and providing premium pay to essential workers.
Then in 2023, eligible uses were broadened to provide more flexibility in addressing pandemic impacts, including relief from natural disasters and projects that make investments in water, sewer, broadband or transportation infrastructure. Funds can also be used for any program, project, or service that’s also eligible under U.S. Department of Housing and Urban Development’s Community Development Block Grant program.
The city is also not required to pay back the amount of value lost from the cards, according to Glagola, who said such loss will be “recorded and reconciled through the city’s regular financial oversight process.”
Moving forward, the city will instead activate cards when distributing instead of beforehand.
“We have also strengthened our procedures for using prepaid cards and other time-sensitive funding tools to minimize value loss in future programs,” Glagola said.
Portsmouth has partnered with Hampton-based nonprofit PLANU Inc. to distribute the cards to qualifying Portsmouth residents at a cost of $18,850, which comes from the city’s manager fiscal 2026 budget. Residents must apply online and will receive an amount based on need.
The gift cards and the previous processes used to distribute them were at the center of multiple internal investigations. In November 2022, former City Manager Tonya Chapman said an internal investigation with her staff found that around $80,000 out of more than $3 million in gift cards weren’t securely stored or might not have been properly accounted for under her predecessor, Angel Jones. Chapman also questioned the process used for distributing the cards because the list of residents who received the cards included duplicate names and IDs and not all gift cards were distributed.
Then when Mimi Terry, who was the city’s chief financial officer under Jones, took over after Chapman’s firing in January 2023, Terry later reported all cards were accounted for and properly stored with no money missing.
Since 2022, the city has distributed 88% of the total 16,075 cards purchased. Portsmouth purchased 4,075 cards valued at $500 each and distributed 3,761 of them, according to the city. It purchased 12,000 gift cards worth $100 each and gave them out to 10,311 residents. The city spent $3.24 million total for the cards.
How to apply
To qualify for the current round of gift cards as part of the Community Assistance Program, Portsmouth residents have to provide proof of economic hardship, which can come from unemployment, a limited fixed income or being a recipient of public assistance. Those receiving SNAP or other financial benefits as well as Medicaid or Medicare must provide proof of enrollment. Applications can be completed online by visiting planuinc.com/gift-card-giveaway and submitted via email to planuinc@gmail.com.
Once approved, PLANU will contact residents directly with details about pickup. Qualifying residents will receive amounts based on demonstrated need.
For questions, residents may call 757-561-0315 or visit planuinc.com.
Natalie Anderson, 757-732-1133, natalie.anderson@virginiamedia.com
https://www.pilotonline.com/2025/11/10/portsmouth-gift-cards-relief/
