The passing of Mayor Lori Lightfoot’s 2022 budget Wednesday sealed the deal on Chicago’s first experiment with guaranteed basic income for low-income residents. In her remarks after the budget passed, Lightfoot said the money is intended to help keep working families afloat as the city continues its pandemic recovery.
“Having extra income consistently for some time can make the difference for the working poor who are living on the cusp of financial ruin,” Lightfoot said. “That’s why $35 million of the $157 million that we’re investing in family assistance programs will fund the largest pilot program in the country, providing $500 a month to 5000 families with cash assistance to lift them up out of poverty.”
Similar guaranteed income programs have been tested in smaller cities in recent years, including Gary, Indiana and Stockton, California. Los Angeles also recently announced its own basic income pilot for 3000 households.
Ald. Gilbert Villegas (36th Ward) spearheaded an effort to start a basic income earlier this year. His committee introduced an ordinance in April.
“The way that we envisioned, what we learned from the hearings is that in Stockton, California, these types of programs really uplifted families and quite frankly allowed some families, the head of the household, to find a better job,” Villegas said.
Ald. Villegas says the details are still being worked out for the city’s program as to who will be eligible. The ordinance his committee put forth in April outlined eligibility requirements that he recommends for the city’s program as well.
Among the requirements:
• to be a Chicago resident who is enrolled City Colleges or has a dependent: (a) who is enrolled in Chicago Public Schools or City Colleges or (b) who is not yet the minimum age to attend Chicago Public Schools;
• to have experienced a COVID-19 Impact at the time of application;
• to have an income at or below 300% of the federal poverty guidelines; and
• to not be employees of or elected officials of the City of Chicago or the State of Illinois.
Estrada’s organization Metropolitan Family Services serves over 100,000 people, 92% of whom make less than $35,000 annually, which is considered poverty level for a family of six. He says COVID’s financial wallop hit low-income households, especially Black and Latino households, the hardest.
“The need is great in the Latino community, certainly in other communities as well ... Latinos have been the most disproportionately impacted in terms of losing their jobs,” said Estrada.
Villegas draws upon his own upbringing in Chicago to buttress his support for guaranteed income programs.
“My dad died when I was 8 years old and my mom had to raise two boys in the Lathrop Homes … and my mom worked and she was able to benefit from a program called Social Security survival death benefits, which gave her a stipend of $800 a month until we were 18,” Villegas said. “It allowed her to work with dignity. It allowed her to pay for child care. It allowed her to make sure that we had food and clothing, but it also allowed … the ability to for us to move out and try to get to a safer neighborhood. So that safety net was huge.”
Estrada says that even though $500 might not seem like much to some households, it can allow those struggling financially to stabilize their lives.
“Let’s say you’re at the poverty level, right? You’re a family of four, you’re at $26,500. You’re struggling in this city. You’re struggling to pay the rent and the bills,” Estrada said. “But let’s say we make it, we figure out how to make it on that low amount of money, but then your car breaks down and where are you going to get that money? This guaranteed income will allow you to pay that bill that repair.”
He adds that offering this money as straight cash, rather than directing it to specific uses, means families can decide how best to use it for their particular situations. It also means the recipients can redirect the time spent tracking down assistance in piecemeal fashion to improving their circumstances long-term.
“People have to wait in line to get food. People have to wait in line to apply for rental assistance. They have to wait in line to apply for other types of assistance like utilities here,” he said. “Now it’s guaranteed and you give them back their time and their dignity.”