St. Paul’s next basic income experiment will send 333 families $12,000, plus money for college

Josh Verges, Pioneer Press
·2 min read
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The City of St. Paul is expanding its guaranteed basic income experiment, giving monthly checks to more families while also making deposits into their children’s college savings accounts.

With the city council’s support, Mayor Melvin Carter launched the People’s Prosperity Guaranteed Income Pilot in November 2020, spending $300,000 in federal coronavirus relief grants and $1.2 million from donors.

That provided $500 a month for 18 months to 150 families from low-income neighborhoods with no strings attached.

Carter announced Wednesday that the next phase, which he’s calling CollegeBound Boost, will send two full years of $500 monthly checks to 333 families with young children. The same families also will get $1,000 added to each of their children’s College Bound St. Paul savings accounts.

Since 2020, every child born in St. Paul or who moves to the city before age 6 has been eligible to receive $50, plus occasional bonuses, in a college savings account earning modest interest. However, a state law that restricts information sharing on the children of unmarried mothers has made it difficult for the city to enroll many of its newborns.

Under the city’s initial basic income program and the new expansion, the families that receive monthly checks are chosen at random among those enrolled in College Bound St. Paul.

The expanded program starts this summer and will be funded with $4 million in coronavirus relief grants plus $1 million from philanthropists, the city said.

The program will be evaluated by University of Michigan professor William Elliott, a prominent researcher of children’s college savings accounts who has worked with the city since the 2020 launch of College Bound St. Paul.

“Guaranteed income helps parents make it through a month. But savings for the future – through savings deposits from the city – gives families tangible hope for their kids’ future,” Elliott said in a statement released by the city. “Both sides of the equation are crucial, and families will benefit immensely.”

Carter said he expects Elliott’s research on the St. Paul initiative will demonstrate that negative tropes about poor people are untrue.

“If we understand that people aren’t poor because they lack character, they’re poor because they lack money, then all the things that we correlate with poverty suddenly aren’t acts of God anymore,” Carter said an at event Wednesday announcing the expansion. “They’re this fungible thing that we can impact just by making sure that people can get to the end of the month.”

Fred Melo contributed to this report.

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