University of Chicago study praises rollout of city's guaranteed income pilot

The funding that was allocated for outreach efforts during Chicago's guaranteed income pilot could be a model for how the city reaches communities in other social service programs, according to a newly published report.

The University of Chicago’s Inclusive Economy Lab recently published the report as part of its research into the yearlong program, the Chicago Resilient Communities pilot, which provided 5,000 city residents with $500 for 12 months with no strings attached. The city’s pilot, which ended in 2023, was funded through federal pandemic relief funds.

The study looked at the administration of the pilot, ranging from the application window to the period once the last checks were distributed to participants.

Misuzu Schexnider, program director for financial security at the university’s Inclusive Economy Lab, said that while organizations are usually contracted to run social services, few of them receive funding explicitly to do outreach efforts.

“You’re just being paid to serve them,” she said. “You’re not actually being paid to locate them, to recruit, to build trust with them. It’s difficult sometimes to be able to serve that population because you’re not explicitly funded for outreach activities.”

During the application window, some people sought in-person assistance programs because they wanted to reach an actual person to ensure the program wasn’t a scam, according to the report.

“Especially folks who are less comfortable with virtual or digital forms of communication or relationship, they needed that in-person touch point to be able to feel that this was a real program,” Schexnider said.

The YWCA Metropolitan Chicago was the lead contractor for the pilot program, according to the report. In total, there were more than 700 in-person events while the application window was open. About 176,000 people applied for 5,000 slots. Participants were chosen through a lottery system, according to the report.

But the short window of time for the program launch — about three weeks — resulted in organizations contracted by the city facing unexpected overtime because they weren't able to add staff as quickly, according to the report.

The report also outlines how the program ensured the additional cash didn’t result in participants losing other social service benefits. The payments were considered gifts by the IRS because GiveDirectly, a nonprofit, was contracted by the city to administer the payments, according to the report.

Chicago’s pilot may have also been the first one to receive an exemption from the the Social Security Administration for Supplemental Security Income and Social Security Disability Insurance, which meant people who receive SSI payments were able to potentially participate in the pilot, said Mary Bogle, a principal research associate at the Urban Institute.

“That’s actually huge,” Bogle said. “I haven’t heard of any pilot doing that.”

Other pilots across the country discouraged people receiving those types of benefits from applying for guaranteed income pilots because of the risk it posed to keeping their long-term benefits, she said.

A second city pilot, rebranded as the Chicago Empowerment Fund, is expected to launch sometime in 2025, according to the city’s proposed budget. The program will again serve 5,000 “low-income families and returning Chicago residents,” and provide $500 for 12 months, but more details about the qualifications weren’t available.

The city’s Department of Family and Support Services did not comment on the second pilot's timeline.

While President-elect Donald Trump has vowed to cut government spending, Bogle said many of the pilots weren’t meant to be permanent because they were funded with temporary funds. Future pilots or more permanent guaranteed income programs would likely have to be funded privately or from municipalities' general funds.

Bogle said she thinks that idea could return again once officials realize that today’s employment market isn’t providing the same opportunities as it did during the country’s manufacturing era.

“I think this idea is going to keep coming back,” Bogle said. “And I think it’s quite possible that one day in the future — and it could be sooner, it could be later — the conclusion will be that a healthy America needs to offer a consumption floor to its citizens in order for everybody to participate and consume goods.”