“If There’s One Thing That Causes Poverty, It’s Lack of Money" - Elorza on Guaranteed Income Pilot

“If There’s One Thing That Causes Poverty, It’s Lack of Money" - Elorza on Guaranteed Income Pilot

Providence Mayor Jorge Elorza on Wednesday launched the Providence Guaranteed Income Pilot Program, which will allow 110 Providence residents living at or under 200% of the federal poverty the chance to apply for the opportunity to receive $500 a month for 12 months. 

“If there’s one thing that causes poverty, it’s the lack of money,” said Elorza of the program that is currently funded through private donations — raising questions about its sustainability moving forward. 

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Numerous organizations cite other root causes for poverty, including compassion.com, which states "Cultures have internal and external elements that contribute to the existence of poverty. Some of these conditions are tangible and external, like: lack of shelter; limited access to clean water resources; food insecurity; physical disabilities; lack of access to health care; unemployment; absence of social services; gender discrimination; poor infrastructure; government corruption; and environmental circumstances such as natural disasters, droughts, limited resources or depletion of natural resources."

On Wednesday, Elorza was joined by elected officials and community organizations at Amos House to discuss the guaranteed monthly cash payment given directly to individuals, after the City of Providence received $500,000 from Square CEO Jack Dorsey and other pledged contributions from the United Way of Rhode Island, Rhode Island Foundation, Providence Community Relief Fund and ONE Neighborhood Builders for a total of $1.1 million in cash and in-kind donations to fund the direct cash payments and administrative costs associated with the pilot program.

“[We] see this as a stepping stone for a state-level policy — not just a policy but a reality for every person in this state — that is what we deserve,” said State Senator Tiara Mack, a Brown University graduate who currently works as Youth Organizing Specialist at Planned Parenthood of Southern New England. Mack, a Democrat who represents District 6 in Providence, was first elected to the General Assembly in 2020. 

There will be a lottery open to Providence residents who qualify to apply between August 15 and August 21, with payments expected to begin in October.  

“We’re going to let people on the ground decide where this [money] goes,” said RI Foundation CEO Neil Steinberg. “I think our biggest challenge will be success — if it works, how do we keep it going?”

 

“Investment Not Handout”

In his comments, Elorza called the program an “investment, not a handout” — and said that evidence from other similar programs around the country show that people are more likely to be fully, rather than under, employed due to the added guaranteed income. 

In Rhode Island, employers continue to struggle to hire workers full-time coming out of the pandemic due to a myriad of factors — including unemployment benefits. 

“This is very different than unemployment benefits — this is intended to be additive,” said Elorza. “We’ve seen people are more likely to get full time employment after these types of programs.”

According to Elorza’s office, Providence will also partner with the Center for Guaranteed Income Research, based at the University of Pennsylvania, to build a rigorous and innovative body of research capable of detecting people-level impacts of guaranteed income. 

“Mayors for Guaranteed Income and the Center have published a learning agenda, outlining the questions that will guide the design and study of guaranteed income pilots, and the process by which they will be evaluated. A researcher will be embedded in Providence to support the development and monitoring of the pilot to ensure that it advances the learning agenda and provides valuable data on the effectiveness of the Providence Guaranteed Income pilot program,” says the City of Providence. 

 

Mayoral Candidates on Record

On Wednesday, two candidates in the 2022 Mayor’s race called the program an “interesting” and “compelling” one. 

Brett Smiley, who had previously run for Mayor of Providence, and worked as a top staffer for Elorza, said he believed any discussion of sustainability of such a program needs to take place at the state level.

“Guaranteed Income is a compelling policy idea that is worthy of exploration. We need to look no further than the enhanced benefits paid to Rhode Islanders during the pandemic to see how it might improve the lives of low-income residents and boost our local economy,” said Smiley. “However, given the cost and scale of a sustainable Guaranteed Income program, I believe this is a policy question best left to state and national leaders. As mayor I will remain focused on neighborhood and quality-of-life issues, attracting new businesses to Rhode Island, and making sure the state’s intervention in our schools is successful.”

Gonzalo Cuervo, who has also worked as a top level Democratic staff to elected officials, said he is supportive of the program — and its private funding — for now. 

“Basic income is an interesting concept that many cities across the country are looking at. It’s great that the Mayor secured private funding for this pilot research program,” said Cuervo. “Similar pilots elsewhere have helped participants catch up on overdue bills and provide some breathing room. I look forward to seeing the results and conclusions from this pilot.”

Candidates Nirva LaFortune and Michael Solomon did not respond to request for comment.