Indy nonprofits gave families $500 a month. Here’s how it went.

The eastside Indianapolis groups chose 15 families to test a universal basic income program for a year and a half.

Indy nonprofits gave families $500 a month. Here’s how it went.
Indy nonprofits gave families $500 a month. Here’s how it went.

By Claire Rafford

See original post here.

Janeceia Harris, a 29-year-old single mom of three young and energetic kids, was going through a rough time.

Her car’s transmission had broken down. For two months, she had to Uber to her job at the airport. On top of all that, she was in the midst of trying to move because she couldn’t afford her rent. 

But a year and a half ago, Harris got a bit of a break. Along with 14 other Indianapolis residents, she was selected for a universal basic income pilot through her local community center that would give her $500 a month, no strings attached. 

When the first $500 hit her account, Harris immediately paid her electric bill, so her lights wouldn’t turn off. 

“I was going through a lot,” she said. “It came right on time.” 

The universal basic income program was funded through a partnership between three Indianapolis nonprofits: Southeast Community ServicesEdna Martin Christian Center and John Boner Neighborhood Centers. Participants received a total of 18 monthly payments from October 2022 to this March. 

The program represented an effort to experiment with giving money directly to Indianapolis families, rather than providing them with assistance through programming or donations. Though participants got their last check two months ago, the basic income program was such a success that the centers are hoping to do it again. 

“As much as we want to train people and get them into higher paying jobs, there’s only so much we can impact a living wage or systemic issues,” said Peggy Frame, executive director of Southeast Community Services.  “But if we get cash in people’s hands, it’s going to improve the quality of their life.”

What is universal basic income?

In 2020, John Boner and other eastside organizations formed the Eastside Economic Mobility District, which aims to provide economic resources to families and communities. 

Universal basic income, which provides recurring payments directly to people without requirements for spending, was one of the first programs they explored as a way to support eastside families, said Elizabeth Nash, head of the economic mobility district for John Boner.

The idea has been floated as a solution to poverty in the U.S. for decades. Recently, universal basic income became part of the national conversation after presidential candidate Andrew Yang campaigned on giving every American a basic income of $1,000 a month

The popularity of basic income programs is growing — and not just in Indianapolis. The city of Gary in northwest Indiana completed a citywide guaranteed income program in 2022 on a larger scale. For a year, 125 participants received $500 a month, partially funded by Mayors for a Guaranteed Income, a national organization that advocates for and implements guaranteed income pilot programs.

Money with no strings attached

The 15 recipients of the money were randomly chosen from a group of people who were involved with one of the three community centers. 

They were all women and many were single mothers. Each center selected five participants, and the $500 was distributed to families through a debit account each month. Participants were also required to attend quarterly meetings with the other recipients of the money and meet with their financial counselors monthly.

“We as a culture expect things to be very transactional,” said Maggie Goeglein, chief operating officer at Edna Martin Christian Center. “Even if it’s a matter of capturing data or information and exchange, it is very rare for us to be able to just provide and not have additional strings attached in some way.”

When inflation started to skyrocket in mid 2021, the cost of everyday items such as gas, groceries and clothing increased substantially in a short period of time. Inflation tends to disproportionately impact low-income Black and Latino households, according to a report from the Federal Reserve Bank of Dallas. To add to the stress, the government’s COVID-19 relief payments were long gone, leaving some people struggling to make ends meet. 

“It was still a challenging financial time for so many people, and this came in and provided a little bit longer of a runway,” Nash said.

Creating a safety net

Daywanda Dunn, another recipient, said that the guaranteed income program couldn’t have come at a better time. Last spring, the 32-year-old home health aide got in a bad car crash and was seriously injured. Dunn’s car was totaled and she couldn’t work for nearly six months.

“It really was a crutch for me around that time,” she said. 

When Dunn got her first payment in fall 2022, she happened to be behind on rent and at risk of getting evicted. She used that first $500 to catch up. In the months that followed, she felt increasingly grateful for the funds, which helped keep her and her 10-year-old daughter afloat while she was out of work. 

By the end of the program, nearly three-fourths of the participants were primarily spending their monthly $500 to help cover rent or housing costs. That’s not surprising, given that rent on affordable apartments in Indianapolis increased by 4% last year, according to Axios Indianapolis. 

Part of the aim of the basic income pilot was to help people living from paycheck to paycheck improve their overall financial health, said Frame of Southeast Community Services. 

2019 report from Washington, D.C.-based economic equity nonprofit Prosperity Now found that 40% of American households don’t have a basic level of savings, meaning that should they lose their job or miss a paycheck, they wouldn’t be able to make ends meet. 

“This is one way that we could really impact and help create a safety net for people to have on their own to have some agency over what they make decisions on,” Frame said.

That safety net helped Harris pay to get her car fixed, but it also provided a cushion when her mother got cancer. Harris lost her job at the airport last year because she was visiting her mom in the hospital. The extra income allowed her to pay her bills and rent until she got a new job. 

But the money wasn’t just for emergencies — it was also designed to help people improve their quality of life. Harris used the extra cash to buy summer clothes for her kids — 11-year-old Aaden, 8-year-old Curtrell and 3-year-old Kenzi — and groceries, since Harris said her sons “eat like grown men.” 

“Knowing that you don’t have to pay it back, or (the money) just would be here when you actually need it,” said Harris, “it was just a lot of help.”

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