Targeted project bolsters some low-income D.C. families with cash payment
Basic-income/WASHINGTON - The $5,500 arrived in the middle of August with no strings attached. For Zabria Proctor, it was a godsend. The rent was due. The car loan and insurance needed paying. Bills were piling up. The fridge was often close to bare.
The pandemic had cost Proctor her job as a bus driver for special-needs children in Prince George's County. Her husband's work as a car detailer dried up quickly. What little money they had saved soon evaporated as well.
Like millions of low-income American families, the couple were brought to the brink by the economic devastation wrought by the coronavirus. Unlike most of those families, Proctor received at least a temporary lifeline with the cash infusion.
"Psychologically, it was a huge burden off my shoulders," said Proctor, 30, who lives in a one-bedroom apartment in District of Columbia with her husband and two children. "It was a huge sigh of relief to pay down some debt and to not have to say to my son that he can't have a snack because we have to save food for dinner."
The money was not a random act of kindness delivered by a good Samaritan. It was part of an organized effort by four nonprofit groups in the District to create a short-term guaranteed basic income for some of the neediest families in the city. Each household would receive $1,100 a month for five months or a $5,500 lump payment to help with bills, pay for rent and food, or use however they saw fit.
As the pandemic pushed many already struggling families into poverty, the cash payment to the 353 families participating in the Thrive East of the River program was an effort to stabilize them and their community. Now, five months after the money was provided, the organizations involved with the program are beginning to assess its effects.
"We've been really pleased with the results," said Scott Kratz, director of 11th Street Bridge Park, which has coordinated with Martha's Table, Bread for the City and the Far Southeast Family Strengthening Collaborative to raise $3.6 million so far from foundations, individuals and corporations for the project. There will be an additional 47 households enrolled by the end of January, and organizers hope to raise an additional $500,000 to assist more families. According to the Urban Institute, the project appears to be the largest payment of short-term private emergency cash relief ever offered in the United States.
"The immediate impact of putting cash, nonconditional cash, directly in the hands of families that need it has really served its purpose, and that's because the families are going to be in the best position to figure out how to spend the money," Kratz said.
The organizations also administer the program and work with recipients to help them with groceries and accessing benefits such as tax credit applications and health care, including mental health resources. A key component of the project is that recipients are also provided financial counseling and advice on how to make the best use of the funds they've been given.
While some of the recipients have used the money to pay off pressing bills, others are making down payments on a home purchase or starting their own small business, Kratz said. And many have used it to help other community members in need. One woman who received the cash used some of it to regularly make and deliver meals to senior citizens.
"What I find really interesting is that there is a common thread where, yes, the participants are using it for themselves and the immediate needs of their families. But they're also giving back to their broader community," Kratz said. "It's just sort of this remarkable generosity, particularly for folks that don't have a lot."
Andrea Richardson, 31, has not had an easy go of it the past few years. She spent half of 2019 living in a shelter with her daughter, who was 6 at the time. Richardson says she tried to shield her daughter from the reality of their desperate situation.
"She's very resilient and just goes with the flow," Richardson said. "As far as I know, she didn't really see the scope of everything because I just told her we were going to mommy's school at night."
Richardson and her daughter moved into their apartment in December 2019, but before she could find work the virus struck, schools closed and Richardson needed to stay home full time. She received food stamps and Medicaid, and her apartment was partially subsidized. She also worked some odd jobs during the summer, but without a regular income there was no money to pay for any extras.
The $5,500 allowed her to pay off some debt and improve her credit rating. She bought clothes and school supplies for her daughter. Some she has saved. The money gave her something else as well.
"It's been very encouraging during the time when I just felt very down and depressed and not really knowing where to turn to next," Richardson said. "OK, all the world's not crazy. There's still some togetherness. There's still support. There's still people that think about, you know, people like me."
Mary Bogle, principal research associate at the Urban Institute, has been working with Thrive to assess the project's effectiveness.
"The goals have always been to alleviate crisis, stabilize people through the pandemic, and then move folks to economic mobility, which is what the mission of these organizations is in the first place," Bogle said.
As the pandemic has stretched on and worsened in ways that exceeded most expectations, Bogle wonders what long-term effect the $5,500 cash disbursement could have.
"The Great Recession wiped out a lot of the gains we had made in closing the wealth gap between Black and White Americans. And so I think the pandemic story on that issue has yet to be told," she said. "Will there be gains that could last in helping people out of poverty, just from stimulus, et cetera, with something like the $5,500 that Thrive has added? Will we see people actually moving into mobility?"
The answers to those questions remain unknown, but organizers are encouraged by preliminary results and anecdotal data. And a cash transfer without a byzantine list of rules and regulations for how it must be used is a promising approach, its supporters say.
"They did the right thing by letting people make their own choices because people will move themselves out of poverty if you give them a chance to," Bogle said. "I mean, you take away all these gates that we've built into our system to provide so-called help, people find their own way out of poverty."
