Investing in Families with Solutions that Work

Investing in Families with Solutions that Work

Fifty-percent of Americans have less than $400 in their bank accounts, putting them one emergency expense from a devastating financial crisis. In Alexandria and south Arlington, more than 30% of families are unable to cover basic needs.

When we ask people about the biggest challenges they face, trouble affording the high cost of living in our region is at the top of the list. For example, the City of Alexandria’s Housing Department calculates that a resident needs to earn more than $37/hour to afford a one-bedroom apartment. Low-wage jobs in childcare, food service, home health care, and construction do not provide enough income to support a family. This means low-income families must rely on a combination of employment income, public benefits, and community supports to survive. 

How can we help our neighbors secure a more stable future? Since 2017, more than 100 local communities across the United States, including Arlington and Alexandria, implemented innovative guaranteed income pilots to provide extra support to households on the financial edge. These programs have yielded remarkable results for participants and their communities. Research shows that programs that give parents cash increase employment, parental involvement, and physical and mental well-being, among other findings.

For example, in Arlington’s recently completed pilot called Arlington’s Guarantee, income from employment increased by 36% for 200 families that received the monthly recurring $500, compared to only a 9% increase over the same period for the comparison group. Families report being able to search for better jobs, pay for transportation, and pursue job training with the added slack in their budget.

Alexandria’s guaranteed income pilot, ARISE, is approaching its first anniversary. Since February 2023, 170 randomly selected low-income households are receiving $500 per month for 24 months. The program concludes in 2025 and is already having a substantial impact. 

One participant, a single mother, shared: “I use the money from ARISE to buy healthy foods, clothes, and shoes for my kids.” Another, a single father, noted: “Now I can finally take classes and upgrade my career, so life can get even better.” More than 4,000 Alexandrians earning less than 50% AMI (or $64,000 annually for a family of 3) applied to participate in ARISE, demonstrating the overwhelming need for assistance. 

Efforts like Arlington’s Guarantee and ARISE demonstrate the power of cash in the hands of parents. This was also demonstrated by the expanded federal Child Tax of Credit (CTC) of 2021, which reduced poverty by a whopping 46% before being allowed to lapse in 2022. 

Innovative strategies like these are needed to tackle persistent child poverty in Virginia now. For example, a state Child Tax Credit that provides a $500 refund for every child under the age of 18 in households making up to $100,000 in adjusted gross income would help more than 1 million children in over 640,000 Virginia families. It would reduce childhood hunger, improve test scores for students, and improve infant and maternal health. 

Fourteen states have implemented a state-based Child Tax Credits. Lawmakers are turning to Child Tax Credits as a powerful tool to put more cash in families’ pockets to help put food on the table, buy school clothes, and navigate rising costs. According to a recent statewide poll by Public Policy Polling, 68% of Virginia voters support creating a state Child Tax Credit. And, it has bi-partisan support. Clearly, this is not only a good policy but also a popular proposal. 

Northern Virginia is an economic engine for the state and one of the most prosperous regions in the country. However, many residents do not share in this prosperity. Child Tax Credits are one of the many ways to close the gap and help families invest in themselves and their future. 

Heather Peeler is President & CEO of ACT for Alexandria and Jennifer Owens is President & CEO, Arlington Community Foundation