(The Center Square) – The city of St. Paul is expanding its guaranteed basic income program that provides a monthly stipend to qualified families. Guaranteed basic income is one of several such programs going on in the city.
St. Paul Mayor Melvin Carter said the city would expand the city’s initial GBI with another guaranteed income program that would give 333 low-income families $500 a month for two years. This program would be funded by $4 million from the American Rescue Plan and $1 million from private philanthropy.
St. Paul released data on Sept. 30 on its initial guaranteed income pilot program that was started in November 2020 and gave 150 families $150 a month for an 18-month period.
There are also two St. Paul-based nonprofit organizations offering their own guaranteed income programs, which are funded by private foundations.
Antony Davies, associate professor of economics at Duquesne University, has stated for guaranteed-income programs to be effective, they should replace other safety-net type social programs. Davies questioned how effective another program safety-net type program would be if the guaranteed income programs just stack on top of other government subsidy programs.
A nationwide movement to start guaranteed-income programs is gaining momentum.
“I’m proud of Saint Paul’s leadership in this national movement, and of these research findings which show our work is making a difference,” Carter said.
The program was offered to families already enrolled in CollegeBound Saint Paul, a college savings program for every child born in Saint Paul after Jan. 1, 2020. Each family had to show that they were also “impacted financially” by the COVID-19 pandemic.
The initial data from this program was released in a report in late September from the Mayors for Guaranteed Income, a group of mayors from around the nation who are promoting guaranteed income programs.
The data shows that 55.35% was spent on retail sales and services, 28.05% on food and groceries, and 5.74% on transportation. The program cost $1.4 million, according to MGI.
The nonprofit International Institute for Minnesota has started a guaranteed income project this fall that will give 25 households $750 per month for 12 months, according to a news release. That program will require 12 of the 25 enrolled households be refugee families from Afghanistan.
The nonprofit Springboard for the Arts announced its pilot program would give $500 a month for 25 artists in St. Paul for 18 months starting in April 2021. Private foundations are funding both nonprofit programs.
College Bound and the St. Paul’s mayor’s office did not respond to a request for comment.