International Institute is latest to organize guaranteed income pilot project for those in need

Frederick Melo, Pioneer Press
·8 min read

The International Institute of Minnesota has begun an experiment centered on a question gaining national attention. Rather than simply steer new refugees toward a hodge-podge of public services such as food and rental assistance, how quickly would families get on their feet if they were simply issued checks for $750 per month for a year?

In other words, without restrictions on how to spend the money, how would they spend it, and how much would their lives improve?

The institute began enrolling 25 immigrant households — about two-thirds of them recent arrivals from Afghanistan — in its new guaranteed income pilot program in April.

During the COVID-19 pandemic, “we saw how the government responded to help keep people in their homes, and the impact it made in people’s lives,” said Jane Graupman, executive director of the International Institute, which is based in St. Paul. “It’s going to make a dramatic difference.”

The 12-month project, which is backed entirely by philanthropy, is just the latest effort to test the concept of guaranteed income in the Twin Cities. The cities of St. Paul and Minneapolis have both embarked on temporary projects for dozens of families apiece, with the goal in part to prove the efficacy of such programs through scholarly research.

St. Paul Mayor Melvin Carter — co-chair of the national “Mayors for a Guaranteed Income” coalition — recently announced a second phase of the city’s “People’s Prosperity Pilot” guaranteed income project, which will likely get underway in the fall. Dozens of mayors have joined the coalition, which now spans at least 28 pilot projects across the country.

‘I DIDN’T HAVE ANY SHOES’

Andrea Coleman, 41, a single mother of three young children, took part in the first phase of St. Paul’s program, receiving $500 monthly checks for 18 months. Coleman, who had just given birth to her now 2-year-old daughter when the program started in October 2020, had faced the prospect of her first Minnesota winter without cold weather attire.

Back then, she said, “I didn’t have any shoes. I had Crocs,” said Coleman, who had relocated to St. Paul from Gary, Ind., toward the outset of the pandemic to care for her elderly parents. “COVID was out, and I was able to buy masks for the kids. … I was able to buy them toys and a Christmas tree. It made a major difference.”

Critics have cast doubt on whether unrestricted dollars will be spent responsibly, but preliminary results from a municipally-driven project in Stockton, Calif., among other cities, found that some working recipients used the funds to take time off from a low-wage job in order to interview for a higher-wage job, which could raise their quality of life and decrease their need for public assistance.

Other benefits have ranged from the psychological — with recipients feeling less stress knowing they can finally set aside funds for an emergency — to no longer deferring medical care.

Skeptics “do perceive people like, ‘Oh, they’re going to go party with the money,’ ” Coleman acknowledged. “I’m going to say 20 percent of the people would do that — the knuckleheads.”

Part of the impetus for such programs is that the needs of the poor are personal and varied, and can shift from buying a suit for a job interview in one month to affording car repair the next.

“When people come to the U.S., the unimaginable events that have happened in their life — it’s not one thing. It’s often so many things,” Graupman said. “People are living in camps for 20 years, surviving during wars and then escaping — having people track you down, so many things we can’t imagine. And then to come here, and the culture is completely new, the place you’re living is completely new.”

She added: “Most of the people we enroll in this program are working, but just because you’re working doesn’t mean you can pay your rent. We all know the cost of rent has gone up, as has inflation in general.”

ACADEMIC RESEARCH

The results of the International Institute program will be tracked by Kalen Flynn, an assistant professor at the University of Illinois-Chicago’s Jane Addams College of Social Work. Flynn is also a lead investigator with the University of Pennsylvania’s Center for Guaranteed Income Research.

Flynn is also involved with another St. Paul-based guaranteed income program, this one geared toward artists. In April 2021, Springboard for the Arts began issuing $500 in unrestricted monthly support to 25 artists in the Frogtown and Rondo neighborhoods. The monthly checks will be issued over an 18-month period, with 75 percent of the recipients being people of color.

Flynn noted that guaranteed income programs are distinct from universal income efforts in that they’re targeted and often means-tested to benefit vulnerable populations.

“The artists that I work with have really used the guaranteed income for a couple different things, some that are unique to artists, like investing in their own art, showcasing their art or maybe traveling for their art,” Flynn said. “Then there are the kinds of things that are more common for guaranteed income projects, like long-term planning such as setting aside money for retirement, or rent, groceries and other bills.”

“Not having to work within the parameters of a grant, they have the flexibility to pursue their own ideas,” she added. “To some extent, it pushes up against the exclusionary practices of the art world. Not all art has to be shown in a gallery. They’ve been able to showcase in their own communities, which speaks to who gets to consume art.”

In both the refugee and artist populations, recipients she’s interviewed have evidenced a greater sense of stability and personal freedom. Early on, “there was still a sense of the bottom dropping out beneath them, or the other shoe dropping,” Flynn said. “If my car breaks down, it’s almost like a spiral. How do I afford the next impending thing?”

ST. PAUL ENTERS PHASE II

Those findings echo with Kasey Wiedrich, financial capability manager with the city of St. Paul. From October 2020 to this past April, the city’s “People’s Prosperity Guaranteed Income Pilot” project serviced 150 St. Paul families with $500 monthly checks. Families were chosen from among those already participating in CollegeBound St. Paul, the mayor’s effort to connect newborns in the city to college savings accounts.

The city expects research results from the Center for Guaranteed Income Research next year, but Wiedrich said that anecdotally, participants have already noted “feeling like ‘my nose is finally above water and I can breathe.’ ”

“A lot of people were talking about taking care of their infants, or being able to handle medical bills,” Wiedrich added. “Can my family go to the emergency room at 5 p.m. on a Friday, or do we tough it out? One participant talked about going back to school, or taking on job training during the pandemic, taking on things that would have felt too risky without a (financial) cushion.”

Others have mentioned enjoying simple family outings and downtime with family that previously felt out of reach, “like getting cupcakes for a birthday party or going to the zoo,” she said.

Felicia Henderson, 36, a single mother of four kids, said her public assistance barely covers her rent, so the $500 checks provided a badly-needed financial life raft after she lost her job behind a hotel reception desk during the first few months of the pandemic.

“That was very, very scary, very stressful,” said Henderson, who lives in St. Paul’s Battle Creek neighborhood. “(Public assistance) didn’t cover toiletries and baby bills and all the other necessities of life. It helped to keep us afloat and gave a little breathing room.”

FUNDING

When the second phase of the St. Paul program launches, likely this fall, 333 families with newborns or small children will receive $500 checks monthly for two years, as well as a one-time contribution of $1,000 into a college savings account at Bremer Bank. An additional 334 families will have $1,000 deposited into their children’s Bremer college savings accounts, without the monthly checks.

Those families will have their progress surveyed by the Center for Guaranteed Income Research and compared to 333 families whose “College Bound St. Paul” college savings accounts were set up by the city with $50 but no additional boost or monthly benefit.

The Springboard for the Arts effort is backed by the McKnight Foundation and the Bush Foundation, and follows a similar set-up as guaranteed income pilots for artists in Long Beach, Calif., and San Francisco. The International Institute of Minnesota pilot program received funding from the St. Paul and Minnesota Foundation, the Kresge Foundation and anonymous donors.

The St. Paul effort is backed by $4 million in federal American Rescue Plan funding and $1 million from the Bush Foundation and McKnight Foundation. Additional funders are considering investments into College Bound St. Paul accounts, said Wiedrich, though no firm commitments have been made. No city general funds will be used for the program, she said.

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