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Mayor LaToya Cantrell’s administration has launched a new, privately funded program to provide monthly cash payments to a small group of New Orleans teenagers and young adults, part of a national pilot aimed at building a case for a guaranteed income.
The program selected 125 residents ages 16 to 24, and at the end of April began paying each $350 per month for 10 months. Cantrell said the program is aimed at getting “much-needed, unrestricted cash in people’s pockets at a time where we know our people need it the most.”
The administration announced the program last year after receiving a $500,000 grant from Mayors for a Guaranteed Income, an advocacy group backed by Twitter co-founder Jack Dorsey. The payments will come in the form of Mastercard debit cards issued by Mobility Capital Finance, a financial company focused on increasing banking access to those who lack it.
Program participants were randomly selected by the Center for Guaranteed Income Research at the University of Pennsylvania, from lists submitted by 10 community organizations that were asked to identify young people who are not in school and not employed, administration officials said.
Josh Cox, the administration’s director for strategic initiatives, said New Orleans was home to 7,000 such individuals, known in policy circles as “opportunity youth,” before the coronavirus pandemic.
“The pandemic only exacerbated that, as lots of schools had a tough time reaching out to kids through virtual and remote learning,” Cox said in a recent interview. “We decided that it made perfect sense to try to use this as a means of connecting those young people who have been disconnected from work and school.”
The program funded by Mayors for a Guaranteed Income is one of two basic income programs New Orleans is launching with Mastercard and Mobility Capital Finance. Last month, Cantrell signed a separate agreement with those companies for $200 per month to another 125 people over four months.
These cards will go to young people and senior citizens, and also allow access to New Orleans recreation centers. The administration has provided fewer details about this program, but a spokesperson said Mastercard is sponsoring it. There are two months of payments remaining.
New Orleans is one of more than 60 cities participating in pilot programs through Mayors for a Guaranteed Income, in part to learn the effects of guaranteed income policies.
The administration was to supposed hire a research fellow under the terms of an agreement that Cantrell signed last year, but administration officials said in a recent interview that Mayors for a Guaranteed Income allowed an exception in the case of New Orleans. Instead of hiring a single researcher, community organizations with existing relationships with participants will conduct periodic surveys, which will then be sent to the Center for Guaranteed Income Research.
“We explained how important relationships are in New Orleans, and [Mayors for a Guaranteed Income] approved us taking a different tack, using our community-based partners for referrals for that actual touch point with young people,” Cox said.
The payments will total $437,500, and the remaining money will be given to the referral organizations, the United Way for providing financial counseling to the program participants and to Forward Together New Orleans, which will receive a 1.4% fee for serving as a fiscal agent.