How guaranteed income advocates strive to turn cash assistance into policy after COVID-relief funds dried up

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Guaranteed income advocates hope to transform pandemic-era cash assistance programs into permanent government policy now that federal COVID-19 relief funds are expiring.

In a report published Aug. 12 titled “Right on Time: How Cash Helps Families Move Through Life’s Transitions,“ Economic Security Project (ESP) researchers Shafeka Hashash, Maya Tellman, and Rayan Semery-Palumbo made the case for institutionalizing “no-strings-attached” cash assistance.

The push comes as city leaders across the nation face a financial cliff. Dozens of municipal mayors are scrambling to maintain local cash-handout experiments as the federal pandemic aid that funded them nears its final spending deadline.

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Under federal law, local governments had until Dec. 31, 2024, to legally obligate their American Rescue Plan Act (ARPA) funds, and most obligated funds must be fully spent by Dec. 31, 2026. In the Chicago suburb of Evanston, Illinois, municipal officials recently announced an expansion of the city’s guaranteed income program using the remainder of previously allocated ARPA funds before the spending clock runs out.

Evanston is one of more than 100 U.S. municipalities that have launched universal basic income-style pilots since 2018. While many early experiments relied on a blend of private philanthropic dollars and emergency federal stimulus, those coffers are rapidly hitting zero. The looming shortfalls are driving local officials to find alternative avenues to make cash handouts permanent — mirroring recent tax-funded budget maneuvers in neighboring Cook County, Illinois.

The report’s authors build their case by citing “a wealth of data collected from over 250 cash and guaranteed-income pilots across 40 states and the District of Columbia,” claiming the findings prove that direct cash transfers are a “legitimate policy tool.”

They pointed to the COVID-19 pandemic as a prime model, calling direct government checks an example of “large-scale transfers” that reached “households at speed and scale.”

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However, rather than pushing immediate, universal cash handouts nationwide, the authors suggest a tactical shift: tying direct payments to specific life events. Cash assistance works best during periods of personal or financial hardship, they argued, writing that “cash does its strongest work in moments of transition.”

The report highlights life events such as having a child, housing relocation, or post-incarceration reentry. “In work disruption, job loss, or transition, cash is most effective when it bridges short gaps, giving people time to make strategic decisions rather than hurried ones,” the authors wrote.

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They also argued that tying cash to major life changes makes the programs easier to sell to skeptical voters: “Cash delivered at a moment of transition borrows a political logic that the public already accepts,” the report states. “Social Security proves that Americans will accept large-scale benefits when they are legible as earned — a worker paid in, a worker is owed. Unemployment insurance and paid family and medical leave extend that same contributory logic, but add a second condition: the benefit is only triggered by a verified, bounded disruption — a layoff, a birth — not simply by status or tenure.”

The broader campaign for direct payments includes Mayors for a Guaranteed Income, led by former Stockton, California, Mayor Michael Tubbs. Tubbs, who launched one of the nation’s early municipal cash experiments in Stockton, has long argued that federal tax dollars should fund income supplements to help lower-income Americans keep up with rising inflation, rent, and groceries, claiming it’s a viable policy to tackle affordability.

Advocates now face the challenge of turning these pilot initiatives into permanent taxpayer-backed line items. ESP authors contend that it is more practical for lawmakers to integrate cash checks into existing social safety net programs during “transitions” rather than trying to launch an “open-ended, widespread cash program all at once.”

“Each of these moments, from the less visible cases, such as aging out of foster care or leaving an abusive relationship, to the more commonplace, such as attending college and seeking new employment, already commands public funds and public understanding,” the authors wrote.

They further urged lawmakers to repurpose existing taxpayer budgets: “A natural place to start in seeking public funding is with dollars already committed.”

“Many transitions sit within existing public streams, such as Temporary Assistance for Needy Families (TANF), child welfare or workforce budgets, restrictive higher-education access funding, or disaster relief, to name a few, that may be redirected toward direct cash rather than requiring new appropriations,” the report continues.

State affiliates are already moving forward. Economic Security California, an ESP arm, is laying groundwork for state-funded guaranteed income programs. California currently leads the country in pilot programs, hosting more than 60 cash initiatives to date.

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To sustain these efforts, ESP recommends that local and state governments look beyond donor funding and establish dedicated revenue streams from local taxes.

Founded in 2016, ESP originally launched with more than “100 entrepreneurs, activists, researchers, and philanthropists” advocating for direct cash payments.

Fox News Digital reached out to the Economic Security Project for comment but did not receive a response by press time.

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