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Business and Economic News
The Associated Press and Nina Moini

St. Paul City Council OKs guaranteed income pilot project

The Mayor of St. Paul speaks to the press
St. Paul Mayor Melvin Carter introduces the city's new plan to give a guaranteed income of $500 a month to 150 St. Paul families at a press conference on Sept. 3.
Peter Cox | MPR News file

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The St. Paul City Council has voted unanimously to approve Mayor Melvin Carter’s proposal to guarantee $500 in monthly income to 150 low-income families affected by COVID-19.

The council was poised last week to approve using $300,000 in federal CARES Act funding to launch the pilot program, but decided to wait a week after U.S. Rep Betty McCollum questioned whether the plan would meet legal requirements for spending the coronavirus aid or endanger participants' eligibility for other aid programs.

But Muneer Karcher-Ramos, director of the city's Office of Financial Empowerment, told the council Wednesday his office had confirmed that the plan was allowed, the St. Paul Pioneer Press reported. He also said there would be systems in place to educate families about how it might affect their eligibility for other benefits.

The mayor has said philanthropy will fund most of the $1.5 million, 18-month project, which is aimed at stabilizing the finances of disadvantaged families.

In response to concerns raised by the council related to geographic eligibility which was initially focused on four specific zip codes, program eligibility will be expanded to any low-income St. Paul resident who is the parent or guardian of a CollegeBound Saint Paul beneficiary, and who is experiencing an adverse financial consequence as a result of COVID-19, regardless of address, ward or neighborhood. 

City staff reports nearly one quarter of St. Paul residents have applied for unemployment benefits since the start of COVID-19.

Carter’s plan is shaped after an initiative by the mayor of Stockton, Calif., that has been giving 125 residents $500 per month since 2019. Mayors in at least 25 cities — from Los Angeles to Paterson, New Jersey — are now pledged to support such programs as part of the group Mayors for a Guaranteed Income.