Getting $500 a month from Alexandria with no strings attached is nice, but participants in the city’s guaranteed basic income pilot say things are still tough.
The news comes from a new report and brief on the impact of the first year of the city’s two-year Recurring Income for Success and Equity (ARISE) program.
“Even adding the full $6,000 a year of ARISE income, participants would still be living in poverty in an expensive city,” according to the brief. “Despite this assistance, more than 70% reported experiencing food insecurity in the past month. Few had any meaningful savings, and more than half had credit card or other revolving debt.”
City Council, in late 2022, approved the pilot — giving $500 a month for two years to 170 low-income participants. There were more than 4,100 applicants. The $3 million program is funded by the American Rescue Plan, and additional funding has allowed for an additional five-month extension. That means the participants will receive checks until June 2025.
A few program participants wanted more money.
“[H]aving $1,500 and then your rent being taken care of, then you feel like, okay, the money that I am working for is going towards improving my life versus just surviving and paying the bare minimum,” participant Kristina reported.
For many, the pilot means not having to choose between buying groceries and paying rent.
Participant Andre said that his rent is $2,500 a month, he’s the only adult working in his home, and also pays for a phone bill and two cars.
“Sometime my children ask me something that I can’t really afford it for them,” Andre said. “It’s not easy.”
The participants earn less than half the area median income ($49,850 for one person, $64,050 for a family of three), and the median income for participants is $21,600, according to the brief.
“I am hopeful that the City can also glean lessons from this experiment to better guide how we administer other programs designed to alleviate poverty in the future,” Mayor Justin Wilson said in his monthly newsletter.
According to the city:
In many Alexandria ZIP codes, the annual rent for a one-bedroom apartment is more than $23,520 ($1,960 a month), far exceeding the reported median income of participants. Our interviews and home visits with participants indicate that this disparity between housing costs and income levels creates significant financial strain, often forcing participants to prioritize rent over other essential needs. Many report living in housing units with quality issues such as mold, pests, and inadequate maintenance, which can negatively affect their health and well-being…
One year into ARISE, participants had calmer home lives, fewer difficulties with transportation and childcare, a renewed sense of hope for the future, and improved mental well-being. Interview data also suggest moderate improvements in financial and housing security, along with evidence that ARISE participants were able to invest more in their roles as parents or caregivers. However, Alexandria’s high cost of living continues to be a challenge and might have limited participants’ ability to save enough money to feel financially secure and invest in their futures.
