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Q&A: What does guaranteed income mean for Ann Arbor?

Guaranteed income programs are popping up across the country, including the University of Michigan’s hometown of Ann Arbor. But what are these programs, who is eligible to participate, and how does guaranteed income address poverty and inequality?

Led by Poverty Solutions at the University of Michigan, Guaranteed Income to Grow Ann Arbor (GIG A2) is a two-year guaranteed income pilot to provide monthly payments of $528 to 100 entrepreneurs with low and very low incomes in Ann Arbor. The City of Ann Arbor selected U-M to implement the pilot and study its effects, and GIG A2 is accepting applications in October. 

Kristin Seefeldt

“This guaranteed income pilot is about celebrating residents who do much to strengthen our community but are still struggling to make ends meet,” said Kristin Seefeldt, associate director of Poverty Solutions, in an official announcement of the program. “Pilot participants are vital to the success of the research study, which will allow other communities across the country to learn from Ann Arbor’s approach to guaranteed income.” 

Here, the three U-M faculty researchers leading the pilot program discuss the idea behind guaranteed income and the GIG A2 pilot program goals.

Kristin Seefeldt is an associate professor of social work at the U-M School of Social Work, with a courtesy appointment at U-M’s Gerald R. Ford School of Public Policy. Seefeldt is also the principal investigator for GIG A2.

William Lopez

William Lopez is a clinical assistant professor of health behavior and health education at the U-M School of Public Health and Faculty Associate in the Latina/o Studies Program. Lopez is also a co-principal investigator for GIG A2 and a senior advisor at Poverty Solutions.

Rebeccah Sokol is an assistant professor of social work at the U-M School of Social Work. Sokol is also an adjunct assistant professor of health behavior and health education at the U-M School of Public Health and a co-principal investigator for GIG A2.

What is guaranteed income?

Sokol: Guaranteed income is a cash transfer program that provides regular, unconditional, and unrestricted funds to individuals or households. Recipients can spend the money however they would like without requiring that they perform specific activities—like working or going to school—to remain eligible.

Rebeccah Sokol

Rebeccah Sokol

Guaranteed income is always unconditional. Recipients do not need to perform specific behaviors to continue receiving funds. The program may, however, focus on certain people. For example, a guaranteed income program may focus on people who earn an income below a certain threshold. 

In Guaranteed Income to Grow Ann Arbor, we are implementing a guaranteed income program that is focused on entrepreneurs in Ann Arbor who qualify as low-income earners. We are not requiring, however, that these individuals continue working to continue receiving their monthly guaranteed income payments.

What do these types of programs seek to achieve and how do they benefit individuals within (and maybe outside) of the program? 

Seefeldt: These programs seek to provide people with a stable and dependable income. We know that many people who work lower-paying jobs also experience great variability in their scheduled hours week-to-week. This means that their pay varies as well, making it difficult to plan and manage finances. Having a reliable source of income, and one that can be flexibly used, may help mitigate some of the stress associated with unstable pay and lower the likelihood of experiencing hardships such as food and housing insecurity.

There could be a number of positive spillover effects of guaranteed income to the larger community, including for people not receiving payments. The payment may be used to help support extended family and friend networks. Many recipients will use the money to purchase goods and services, which is important to keeping the economy going.

Lopez: It’s also critical to remember that guaranteed income programs are fundamentally community health programs. Individuals and their families often know best what is needed to keep them healthy and happy. Unrestricted income allows them to spend that money on things like meals, medicines, fuel, child care, or even socializing. We often think of health interventions as interventions that specifically increase access to medications or to medical care, but there are many other aspects of our lives that actually keep us healthy. For members of marginalized communities, maintaining their health often requires navigating government systems working against them; and there are rarely, if ever, government programs to support maintaining one’s health in this way. For example, families who accrued debt while incarcerated may be able to pay down debt, or those who need a lawyer to fight deportation may be able to afford to hire one.  Unrestricted cash allows families to prioritize these aspects as they see fit.  

Where else in the U.S. are guaranteed income programs happening?

Seefeldt: Currently more than 100 cities have run—or are in the process of running—guaranteed income pilots. There are guaranteed income pilots planned and happening in communities across the United States, including Flint, Michigan; Stockton, California; Philadelphia, Pennsylvania; and New Orleans, Louisiana. 

Lopez: Importantly, guaranteed income programs are not just—nor primarily—an academic idea. There is a growing movement throughout the country for more cities to embrace guaranteed income programs as a means of addressing economic disparities and the harms to health and well-being that often accompany poverty. Guaranteed income is rooted in the simple idea that every human being deserves to have their basic needs met, no matter what, and that unrestricted income empowers individuals and families to decide how to meet these needs. 

What are some of the questions you’ve grappled with so far in designing the study? 

Seefeldt: One issue that continually comes up is how to design a pilot that isn’t overly bureaucratic. A common complaint about many social service programs in the U.S. is that they require applicants and recipients to jump through many hoops in order to receive a benefit. Some refer to this practice as “administrative burden.” We don’t want the GIG A2 application process to be overly burdensome; we don’t want anyone to be deterred from applying because the application seems daunting and requires too many forms of documentation.

On the other hand, we have a responsibility to make sure that the funds for this pilot are spent in an ethical and responsible manner. Part of doing so means making sure that the pilot is serving those whom it was intended to serve and being accountable to the federal government to make sure that taxpayer dollars go toward their intended use. Thus, we are requiring that applicants provide some documentation to support their application.