City to pilot cash assistance program with input from university’s inclusive economics lab

In response to the lingering economic effects of the COVID-19 pandemic, Mayor Lori Lightfoot recently announced the launch of the Chicago Resilient Communities Pilot program, which will provide 5,000 low-income Chicago residents with $500 per month for an entire year. Applications for the program began in April and closed on Friday, May 13, and recipients will be selected through a lottery system. Basically, unlike other cash assistance programs, there will be no qualifications on how individuals can spend this money – they are free to use it for whatever purpose they wish.

The pilot program has very few eligibility requirements. Applicants must live in the city of Chicago, be over the age of 18, have a household income below 2.5 times the federal poverty level, and demonstrate that they have experienced adverse economic effects as a result of the pandemic. According to the mayor’s office, one of the main goals of the program for Lightfoot is to ensure that it is implemented in a “fair and effective” manner. The city enlisted the help of an advisory group of experts and nonprofits, one of which is the UChicago Inclusive Economy Lab.

The Inclusive Economy Lab is a division of the Urban Lab at UChicago. In an interview with Brown, Program Director Misuzu Schexnider explained that the pandemic created the conditions for a cash assistance program to be possible. COVID-19 “has made the Chicago government more cash-friendly and led to the expansion of the Workplace Tax Credit, which has had a direct impact on reducing child poverty,” said Schexnider said.

“The Inclusive Economy Lab has a long history of partnering with Chicago Public Schools, with Chicago Colleges, and with the Department of Family and Support Services, which is why Mayor Lightfoot reached out to us directly about ‘a partnership,’ she said.

The lab will assess the impact of the pilot program by collecting expenditure data from program beneficiaries and analyzing the demographic characteristics of participants. Schexnider said the lab will conduct surveys six months after final payment and track longer-term results for 10 to 15 years. “We want to do research that is really useful to people in the field. Instead of just doing research for research’s sake, we really try to do policy research, which means asking questions that are of interest to our partners,” Schexnider said.

Schexnider also mentioned that the foundation for the program was laid by the Chicago Resilient Families Initiative Task Force, which conducted a test program two years ago. This task force found that investing additional federal dollars in local government budgets had a direct impact on citizens. These findings led Mayor Lightfoot to include additional provisions in her budget for future programs.

Schexnider explained that the Resilient Communities pilot program would act as a “meta-analysis of the impact of direct cash payments to struggling families.” Although New York has a program that provides direct cash transfers of $1,250 per month to homeless people aged 18-24 (developed by Chapin Hall of the University of Chicago) and a network of mayors from several States is advocating for guaranteed income for all state citizens through “Mayors for Guaranteed Income,” Chicago’s upcoming cash assistance program is the largest in the United States outside of Los Angeles. The size of the Chicago program will allow for rigorous assessment of the effects of direct cash payments to residents.

Critics of cash assistance projects argue that such programs can increase dependence on the city government. However, Schexnider was quick to counter this idea. “The Resilient Communities program is designed to level the playing field because we all experience addiction, but some people are lucky because their support networks are much more reliable…Chicagoans should be hugely excited about the initiative because it has the potential to change the way municipal governments improve the well-being of their citizens.

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