Guaranteed income pilot program will use lottery to pick 5,000 recipients of $500 monthly checks

With demand for the $500 monthly payments expected to outstrip the $31.5 million in available cash, Chicago will hold a lottery to pick 5,000 participants in what Mayor Lori Lightfoot has touted as the nation’s largest universal basic income program.

Four months after the City Council agreed to use a chunk of federal pandemic relief money to provide the no-strings-attached cash assistance, the year-long test period finally may be getting off the ground.

On Thursday, Lightfoot marked the two-year anniversary of her war on poverty by announcing the city will launch the lottery for the program in April.

Applications can be submitted at chicago.gov/cashpilot. To be eligible, applicants must: live in Chicago; be at least 18 years old; have experienced economic hardship related to COVID-19; and have a household income at or below 250% of the federal poverty level. That’s $55,575 for a family of four.

At the news conference, Lightfoot explained why she is certain the number of applicants will far exceed the money budgeted for the program.

“Today, 18% of our residents live in poverty. And 44% live just on the edge of poverty. One job loss and one medical emergency away from financial peril,” the mayor said.

“Over 200,000 Chicagoans live in extreme poverty. Meaning their income is less than $6,795-a-year — or $13,875-a-year for a family of four. Those are devastating numbers. Imagine that for a moment, and trying to keep a family of four fed, clothed, safe and healthy on roughly $13,800-a-year. It’s virtually impossible.”

Chicago cannot be a “successful thriving city until we address the needs of our residents, our neighbors, and use every tool in our tool kit to help lift them out of economic hardship.”

Ald. Gilbert Villegas (36th), City Council champion for guaranteed basic income, said he has no problem with the lottery, “as long as it’s a fair lottery which encompasses allowing all residents of Chicago the ability to participate in all neighborhoods.”

In fact, Villegas proposed a lottery as part of the guaranteed income ordinance he introduced more than a year ago. He supports such a program “because there are thousands of working families that are having a hard time making ends meet in Chicago, especially during the pandemic,” he said.

“This pandemic did not take into consideration ZIP codes, ethnicities and gender. Once the lottery is available, you’ll see this pandemic has hit everyone equally. I would anticipate that the majority of participants will be from wards that have minority” alderpersons.

What frustrates Villegas is that even though the city will start accepting applications in April, it remains unclear when checks will start arriving.

“I hope there is a sense of urgency to get this money out. It’s just sitting there and people are waiting to be rescued, as the American Rescue Plan has in its name,” said Villegas, who was not invited to Thursday’s announcement — possibly due to his past complaints about the slow pace.

“I brought this program forward in February of last year and had an ordinance ready to go in April. Here we are almost a year later and we’re still talking about it. Let’s do it. I receive calls weekly about when the program is going to start.”

Lightfoot would only say she is “thrilled to get this program up and running.”

“As my team knows, I’m not a patient person. We need to get checks in the hands of folks as quickly as possible,” she said.

“Cash is a simple and powerful way for governments to support residents who are working hard to regain stability and build a better life for themselves and their families.”

Her voice breaking, Lightfoot again cited her own family’s money struggles.

“I want to change the lives of Black and Brown folks. Low-wage workers. Because I come from that. That’s who I am. That’s who my people still are,” she said.

“Regardless of the winds that blow, slings and arrows that come my way, what gives me energy and determination is knowing that people who are growing up in circumstances like mine, some small child — his life is gonna be better because of our shared work. That is a powerful motivating force that keeps me fueled every single day.”

The Department of Family and Support Services has issued two requests for proposals for agencies to “administer and execute outreach for the pilot.”

An advisory group of experts in Chicago and across the country is helping the city with design and implementation. City Hall has also asked the Inclusive Economy Lab at the University of Chicago to evaluate the pilot’s impact on the 5,000 participants.