Ann Arbor, Michigan is trying out a new approach to help local entrepreneurs. The program, known as Guaranteed Income to Grow Ann Arbor, gives low- and moderate-income residents $528 a month without any conditions attached.
This pilot program began distributing monthly payments in January and will run through the end of 2025. Participants qualify if their income is at or below 225% of the federal poverty line.
The goal is to see if these payments can help entrepreneurs and small business owners achieve their business dreams. People involved in side hustles, independent contracting, or creative arts who meet the income criteria are also eligible.
Ann Arbor GBI Pilot Could Help Low-Income Entrepreneurs Build Their Businesses
Ann Arbor, already known for its thriving tech and small business sectors, is taking a significant step with its Guaranteed Income to Grow program.
With nearly half of Michigan’s startups based in Ann Arbor, the city is a fitting location for this initiative.
Funding for this pilot comes from various sources. The city is utilizing $1.6 million from the 2021 American Rescue Plan Act. This act, meant to aid economic recovery during the pandemic, has often been used for basic income programs.
The Ann Arbor Area Community Foundation also added money, while the University of Michigan will cover researchers’ salaries.
The program involves 200 participants in a randomized trial. Out of these, 100 individuals will receive payments, and the other 100 will serve as a control group.
All participants will provide feedback through surveys conducted by University of Michigan researchers.
Other cities are launching similar programs targeting specific groups. In Atlanta, a program focuses on low-income Black women. Meanwhile, Denver’s initiative supports people experiencing homelessness, and new mothers benefit from Flint, Michigan’s program.
Moreover, after seeing positive outcomes, Chicago has reinstated its program, giving $500 a month to low-income residents.
Despite these initiatives, not everyone supports GBI programs. Some Republican lawmakers argue against them.
For instance, the GBI program in Harris County, Texas, is currently under scrutiny. Attorney General Ken Paxton claims the program is unconstitutional, delaying payments for 1,928 families.
Additionally, legislators in Iowa, Arizona, and South Dakota have also attempted to ban such programs. They label them as socialist efforts that might promote dependency on government aid.
This landscape shows the varied responses to GBI initiatives across different regions. While Ann Arbor’s program could potentially uplift local business owners, it also faces challenges similar to those seen elsewhere.
