Dive Brief:
- Columbus, Ohio, is teaming up with community groups on a $2.5 million, two-year pilot that will give direct cash payments to employed residents who earn above the federal poverty level but below the cost of living in the region.
- Up to 200 households will each receive $500 per month. They can spend the money how they choose, but to remain eligible, they must complete one of six programs offering job training, career services or wealth-building guidance.
- “Through this program, we're giving Columbus residents a crucial stepping stone from simply getting by to truly thriving,” said Columbus City Council President Shannon Hardin in a statement on Oct. 31, when the city announced the pilot.
Dive Insight:
Communities across the U.S. have experimented with programs that give people direct cash payments, hoping that it will help them meet everyday needs and improve individual and community outcomes.
Some such pilots have yielded strong outcomes: A July study published by University of Pennsylvania researchers found that a guaranteed income program in Los Angeles had “overwhelmingly positive” results. Compared with a control group, residents who received $1,000 monthly cash payments over a year were more likely to secure full-time work, have healthy behaviors, enroll their children in extracurricular activities and experience positive interactions with neighbors. Recipients of the cash payments also reported using the money to prevent and exit situations of intimate partner violence.
In Columbus, 44% of households are employed in jobs that don’t pay enough to cover the region’s cost of living, Mayor Andrew Ginther said in a statement. The income qualifications for participating in the Columbus pilot vary by how many people are in a household. For example, one individual must make more than the federal poverty level of $15,060 each year but less than the Central Ohio cost of living of $30,084.
Six community partners will administer direct funding assistance to qualifying participants as well as run the mandatory economic mobility programs. One program run by Goodwill Columbus will train individuals to get a Class A commercial driver’s license, which is necessary to operate large trucks. The program also pays students’ license exam fees up to two times each. Another program run by the Columbus Metropolitan Housing Authority and the CMHA’s RISE Center addresses barriers to generational wealth.
Additionally, each participant will receive financial literacy training and a $500 savings account.
