St. Paul uses CARES Act money for mayor's guaranteed income program for struggling families

By Evie Fordham FOXBusiness

City has a poverty rate of 20.4%, well above Minnesota’s average.

The City Council of St. Paul, Minn., voted to launch an experimental $1.5 million guaranteed income program for low-income families Wednesday after Mayor Melvin Carter signed onto the group Mayors for a Guaranteed Income.

The program will divert $300,000 in CARES Act funding to give 150 families payments of $500 a month, the Twin Cities Pioneer Press reported. The rest of the 18-month program will be funded by philanthropy, the mayor said, according to the Twin Cities Pioneer Press.

“More than ever before, this economic crisis has pushed families into crisis, struggling to maintain basic necessities for their children,” Carter, a Democrat, wrote on Twitter on Sept. 4. “Our People’s Prosperity Guaranteed Income Pilot Program will support our most vulnerable families while helping build the case for permanent guaranteed income programs at state and federal levels.”

St. Paul Mayor Melvin Carter unveils the Minnesota Timberwolves 2019-20 City Edition uniform at a press conference on Nov. 20, 2019, at Target Center in Minneapolis. (David Sherman/NBAE via Getty Images)

St. Paul has a poverty rate of 20.4%, well above the state’s average, according to Data USA. Other cities launching programs in conjunction with Mayors for a Guaranteed Income include Pittsburgh and Long Beach, Calif.

Also this week, Mayors for a Guaranteed Income announced it added 14 mayors who support such programs to its roster, including Mayors LaToya Cantrell of New Orleans, Jenny Durkan of Seattle, Jim Kenney of Philadelphia and Levar Stoney of Richmond, Va.

The coalition of mayors, which was founded in June, has committed to exploring direct, recurring cash payments to community members and advocating for a similar program nationwide.

“We are living in uncertain times with even greater widening economic disparity as a result of COVID-19,” said Michael Tubbs, the mayor of Stockton, Calif., and founder of Mayors for a Guaranteed Income. “As mayors, our problems may look different from town to town, but we are united in our duty to ensure the economic security of our residents, and it is unacceptable that people who are working two and three jobs can’t afford basic necessities.”

Tubbs, 29, launched a small, 18-month-long guaranteed income experiment in Stockton in early 2019, offering $500 a month to 125 residents to spend however they wanted. There are an estimated 311,000 residents in Stockton. Research data from the pilot suggests most recipients spent the money on things like transportation, utilities, health care and paying off debt. Nearly 40% of tracked spending went to food, according to the University of California Berkeley.

FOX Business’ Megan Henney contributed to this report.

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