Although an evaluation of the initial guaranteed basic income pilot won’t be available until next year, St. Paul Mayor Melvin Carter announced last week he plans to distribute a second wave of $500 monthly cash payments to low-income families.
Mayor Jacob Frey announced Minneapolis will begin a similar guaranteed basic income pilot later this year.
Select St. Paul families will be enrolled in the program, which will be funded using money from the American Rescue Plan. In addition to guaranteed income, the program also offers payments to college savings plans.
The first wave of payments, called the People’s Prosperity Pilot, gave $500 monthly payments to 150 St. Paul families for a year and a half.
Even though there’s no concrete data to weigh the effectiveness of the guaranteed basic income program, Carter said he was “convinced to double down on the initiative” based on anecdotal evidence of how the payments made a difference in the lives of families, the Star Tribune reported.
“The goal is to give people more flexibility to address the changing needs of their families,” Carter said in a speech to the Midwest Asset Building Conference, according to the Star Tribune.
“St. Paul saw record murder rates last year and can’t keep its roads paved but is wasting money extending a program without any data to tell us if it’s working. Minnesota taxpayers give St. Paul tens of millions of dollars in local government aid only for them to waste it on bike paths and these far-left welfare program experiments,” Rep. Mary Franson told Alpha News.
The second round of checks will be funded with $4 million from the city’s allocation from the federal American Rescue Plan Act and $1 million from philanthropic donors. The program has no reporting or work requirements, according to a statement on the city’s website.
“Giving people money with no strings attached and no work requirement is a bad idea. In fact, it’s quite pathetic and offensive to the people he’s trying to help. There’s dignity in work. When you work, you gain an inherent sense of pride, no matter what you do,” said Andrew Brehm, a longtime St. Paul resident and local attorney. “Good paying jobs and education transform lives not a government check.”
St. Paul, one of the first cities in the country to launch a guaranteed income program, will give 333 families — more than double the number of families who participated in the initial round — monthly cash payouts for the next two years.
Brehm said he believes Carter has good intentions but no interest in doing his duties as mayor.
“He’s distracted from doing his job. The people of St. Paul have suffered a great deal. He needs to devote energy to what he was elected to do,” Brehm said.
The idea of guaranteed income picked up steam in 2020 as more families faced financial hardship at the onset of the pandemic.
“There’s no question the inner city poor are struggling right now. But money with no strings attached encourages government dependency. It’s like a drug. You get hooked,” Brehm said.
Brehm said the city has other options to offer opportunity. He said the focus should be on delivering people out of poverty permanently.
The city of St. Paul is collaborating with researchers from the University of Minnesota and the University of Pennsylvania to study the effects of guaranteed income.
While Carter admitted cities will not be able to indefinitely fund or sustain guaranteed income programs, he and Minneapolis Mayor Jacob Frey, members of Mayors for a Guaranteed Income, hope to make a case for policy at the federal level.
The second round of funding must be approved by the city council. The city did not have a fireworks display on the Fourth of July in an attempt to save money.