Mayor to Pay Poor Parents And Children to Get Out of Poverty

By on March 30, 2007 @ 10:10 am

March 30, 2007

Mayor Michael Bloomberg unveiled a novel $50-million initiative yesterday that will pay poor New York families cash for taking steps to lift themselves out of poverty by keeping their children in school, staying healthy and earning more.

Under the two-year pilot program, 2,500 families will earn rewards ranging from $50 to $300 for attaining goals such as attending a parent-teacher conference, visiting the dentist or getting job training.

A family would get the money once every two months and could receive $3,000 to $5,000 a year, city officials said.

“We’ll offer cash to families as a way of encouraging parents and young people to take positive actions: to stay in school, to stay healthy and increase their earnings – all key ways to rise out of poverty,” Bloomberg said at a news conference in the Brownsville neighborhood of Brooklyn. He added, “No city or state in America has ever invested in a conditional cash transfer program.”

Rebecca M. Blank, dean of the Gerald R. Ford School of Public Policy at the University of Michigan, praised the approach as “creative.”

“We have not, in this country, done serious testing of these sorts of incentive programs,” she told Newsday. “I’m delighted to see New York City is trying it.”

Bloomberg said the pilot program, called Opportunity NYC, will be funded privately, but said if it proves successful he will seek government support. Of the $50-million cost, $42 million already has been raised, he said.

The Rockefeller Foundation is one of the key sponsors, he said. Others include The Starr Foundation, Robin Hood foundation, the Open Society Institute and American International Group. Bloomberg, a billionaire businessman, said he also contributed personally.

When asked why people should be paid for doing things society believes they ought to do anyway, Bloomberg said, “It is true you should take care of yourself. It’s pretty ridiculous to argue that everybody is doing that,” he said. “If this works, shame on us if we’re not willing to try it.”

Under the pilot program, starting in September, the city will enlist volunteer families from the neighborhoods of Central and East Harlem, Brownsville, East New York, Morris Heights, Mount Hope, East Tremont and Belmont.

To qualify, a family’s annual earnings must not exceed 130 percent of the federal poverty level. For instance, a single parent with two children could earn no more than $20,000 annually, said Linda Gibbs, deputy mayor for health and human services.

The city will seek a total of 5,000 families because half will serve as a control group – and won’t receive cash incentives – in order to gauge the impact of the program, officials said.

Gibbs said a similar conditional cash transfer program in Mexico now known as Oportunidades showed an increase in school enrollment and attendance, among other things.

In Chicago, the nonprofit group Project Match has created an incentive program based on points, which allows individuals to earn rewards such as DVD players and health club memberships.

Blank, of the University of Michigan, said impoverished families overwhelmed with making ends meet “may need a little extra nudge.”

Cash incentives under ‘Opportunity NYC’
Amounts to be given families $50 – $300 for meeting such goals as:

Children’s superior school attendance
Children’s improved test performances
Parental involvement
Keeping regular medical and dental visits

Employment and training
Increased employment and earnings
Participation in job training


Copyright 2007 Newsday Inc.

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