Pandemic-era stimulus checks may be gone, but Americans could qualify for $500 monthly payments as another city pilots a guaranteed income program.
City officials in Ann Arbor, Michigan, approved the monthly payments via the Guaranteed Income to Grow Ann Arbor. Through the program, $528 checks go to low-income residents on a monthly basis.
The payments were approved for two years to 100 residents who meet certain criteria.
For one, they need to live in Ann Arbor and be 18 years of age or older. They also must have an income at or below 225 percent of the federal poverty level. The last requirement is that they are entrepreneurs, small business owners or otherwise selling their own goods and services.
The guaranteed income pilot was first proposed by the University of Michigan’s poverty solutions team. While payments began in January of 2024, they will continue until December 2025.
The university is closely tracking how the guaranteed income affects recipients in terms of their business, health and general wellbeing. Recipients will then be compared to a randomly selected group who met the same criteria, but did not receive the payments.
Newsweek has reached out to Ann Arbor officials for comment via email.
Alex Beene, a financial literacy instructor at the University of Tennessee at Martin, told Newsweek that Ann Arbor is likely implementing the guaranteed income pilot based on the success of similar programs in other cities.
“Cities across the country are seeing how guaranteed income programs are changing the lives of those who qualify and lifting them out of poverty,” he said, adding that the added layer of research makes the program especially compelling in Ann Arbor.
Beene continued: “Unique to this particular program is a research component to get feedback on what the program provides and what works and what can be improved. This additional element could help to enhance this particular guaranteed income program and ones like it.”
Cities that have large reserve surpluses from pandemic-era funding are trying to find ways to give the money back to people in their state, Kevin Thompson, a finance expert and the founder and CEO of 9i Capital Group, told Newsweek.
However, he cautioned the selection component to the guaranteed income may anger some business owners.
“Some business owners may see this as picking the winners and losers,” Thompson said. “A random selection does mitigate that risk, but does it truly provide those with legitimate businesses a way to stave off liquidity issues if they are not chosen, and just need a small life line to remain a going concern?”
Thompson added that many of the businesses that did survive the pandemic are also “zombie companies.”
“There has been a rash of bankruptcies this year as pandemic aid has ran its course, and companies are going out of business due to instability,” he concluded.
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