‘No strings attached’ money improves mental health and food security for low-income DC families, report says

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Place money in people’s hands without restrictions authorized their to meet their needs, program administrators said, and removed typical levels of bureaucracy and eligibility requirements that can frustrate recipients and hamper the effectiveness of aid efforts.

“I would say that people with less means are going to make even smarter, more thoughtful decisions because they know how to stretch the dollar,” said Scott Kratz, director of 11th Street Bridge Park, one of the nonprofit organizations lucrative who created the program.

Quantitative and qualitative data from the study showed that “participants often struck a thoughtful balance between addressing immediate survival issues like paying rent and longer-term issues like accumulating debt,” said concluded the analysts.

Beneficiaries interviewed for the study, which was released on Thursday, reported lower rates of mental health stressors and food insecurity than people with comparable incomes in the district and nationally.

For Rahgeena Preble, a single mother of two young children who lives in southeast DC, the money arrived last year when she needed it most. She didn’t have a car and had missed a few doctor’s appointments for her children due to unreliable transportation. She also had an unexpected medical bill for herself that she had to put on a credit card.

“It helped tremendously,” said Preble, 26. “I’m very grateful. It’s just amazing when you think about how much they give.

Preble said she elected to take the $5,500 spread over six months. She used it to pay for transport, food and clothing for her children. And she repaid her debt. She also managed to save some of the money for an emergency fund after the payments ended.

“It made everything so much easier for me,” she said. “The money definitely gave us a leg up.”

The THRIVE East of the River program is a partnership of organizations with a long history of meeting the needs of low-income people District residents: Martha’s Table, Bread for the City, Far Southeast Family Strengthening Collaborative, and 11th Street Bridge Park (a river bridge building project). The program raised more than $4 million in private and foundation funding to pay for the relief effort in cash.

Administrators say the results were a success in almost every way. According to the report, a key objective of THRIVE – stabilizing participants hard hit by the crisis – has largely been achieved. Participants in the program applied to the nonprofit organizations that administered it and were selected based on need.

The program “has demonstrated that unconditional money is an extremely effective form of emergency support,” said Scott Kratz, manager of 11th Street Bridge Park.

Before receiving the cash payments, 34% of participants said they sometimes or often did not have enough to eat, according to the study. After receiving the payments, that number dropped to 19%. Sixty percent of recipients said they used their personal savings to meet household needs before receiving the payments. Once the payments were made, 50% said they used their personal savings.

Housing was a big concern for most participants. Fifty-four percent of recipients said they spent “all or most” or “a large part” of their $5,500 on paying rents and mortgages.

Mary Bogle, senior research associate at the Urban Institute, a Washington think tank that conducts economic and social policy research, said the numbers on food and mental health are particularly compelling.

“Here is a more marginalized and distressed population that is doing better mentally than anyone else in the country in a similar income group,” she said. “And on food insecurity, THRIVE participants come close to what people without low income report.”

Kratz and Bogle said they hope the study results will encourage other cities and communities to consider similar cash-disbursement programs to meet the needs of low-income families, even in non-emergency situations.

The City of Richmond launched a smaller, guaranteed pilot program last year that provided 18 recipients with $500 a month for a year. It has since announced plans to increase by 37 recipients after reports “Very positive results for those who participated.”

Bogle and Kratz reject criticism that argues that poor people will make poor decisions with their money if they receive money directly rather than through food stamps or housing vouchers.

“You have to look at the evidence on these things,” Bogle said. “The conclusion of these studies is not, ‘Oh, the low-income people you give benefits to never spend that money on temptations.’ The conclusion of these studies is that they do not spend it [on those goods] no more than you, me or anyone else would.

A study published last year of a $500 guaranteed monthly income program in Stockton, Calif., showed that recipients were more likely to find full-time employment, be happy and stay healthy. According to the study, most of the money distributed was spent on food or other basic necessities. Tobacco or alcohol accounted for less than 1% of purchases tracked.

Bogle and Kratz also said local, state and federal governments should rethink how funding is currently distributed through stipends that subject applicants to significant bureaucracy and ever-changing requirements.

The current way billions of dollars are distributed to those most in need “has so many strings attached to it and you have to jump through so many hurdles,” Kratz said. “There’s something that’s just kind of clean, sleek, and respectful about delivering money directly to families.”

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