Decreasing homelessness and financial instability with unconditional cash transfers

What is the agency priority?

The COVID-19 pandemic created significant economic impacts for many families, such as job loss, reduction in income, and increased risk of homelessness.¹ In response, the U.S. Department of the Treasury administered the Coronavirus State and Local Fiscal Recovery Funds (SLFRF) program, authorized by the American Rescue Plan Act, which delivered $350 billion to state, territorial, local, and Tribal governments across the country.² The SLFRF program funding aims to address the unique needs of local communities and create a strong national economy. One county recipient allocated $10 million in SLFRF funding to administer an unconditional cash transfer program with the goals of increasing economic security and well-being, and preventing homelessness.³

What did we evaluate?

The county program used a lottery to allocate a one-time unconditional payment of $4,000 to 2,250 eligible applicants identified as individuals at risk of homelessness, low-income families, and seniors living in areas disproportionately affected by the pandemic. Other localities in the United States are beginning to adopt similar programs.⁴ Although the literature on the effects in high income countries is just emerging, there is suggestive evidence that these programs decrease material hardship and homelessness for very low income populations.^5,6

How did the evaluation work?

Analysis plan forthcoming.

What did we learn?

This evaluation is currently being implemented and is part of our American Rescue Plan portfolio. Results forthcoming (2025).

Notes:

1. U.S. Department of the Treasury “State and Local Fiscal Recovery Funds”.
2. Ibid.
3. Ibid.
4. Kline, Sean. 2022. “Basic Income and Local Government: A Guide to Municipal Pilots.” Stanford Basic Income Lab.
5. Pilkauskas, Natasha V., et al. “The COVID Cash Transfer Study: The impacts of a one‐time unconditional cash transfer on the well‐being of families receiving SNAP in twelve states.” Journal of Policy Analysis and Management 42.3 (2023): 771-795.
6. Dwyer, Ryan, et al. “Unconditional cash transfers reduce homelessness.” Proceedings of the National Academy of Sciences 120.36 (2023): e2222103120.