Can $3,700 cash payments prevent homelessness among young adults in Baltimore?

A New York-based nonprofit that gives young adults one-time cash payments to help keep them stably housed is expanding in Baltimore.

Point Source Youth partners with local groups that work with young adults to create housing action plans for 18- to 25-year-olds at risk of becoming homeless. Then Point Source Youth pays to carry them out.

A pilot of the housing program in seven other states enrolled more than 300 participants and distributed an average payment of about $3,700 per person.

Direct cash transfers kept nearly 93% of those participants from accessing homeless services such as shelters for six months, according to a research paper published this year by the Johns Hopkins Bloomberg School of Public Health.

The model is based on other programs that provide direct aid to low-income communities, such as the Cherry Hill Baby Bonus initiative. The efforts in Baltimore coincide with the harsh effects of inflation, leading more people to seek emergency shelter services for the first time, city data shows.

Stagnating wages and competition over the existing supply of homes have contributed to the problem, according to the Hopkins researchers, making young people more susceptible to stress, discomfort and poor health outcomes.

Failing to curb homelessness among young people means funneling more taxpayer money into healthcare, policing and other social systems that fray during times of desperation, Point Source Youth cofounder Larry Cohen said.

A former healthcare technology executive, Cohen said his aim is for the nonprofit’s direct cash payments to be as disruptive to young people as combination therapies were to the spread of HIV.

“Nothing else, by definition, solves the problem,” Cohen said about the group’s approach. “No one says, ‘I’m being evicted tomorrow. I need a case manager.’”

Cohen acknowledged it’s an expensive idea. Eventually, the organization wants state governments to foot the bill — another tough potential sell.

Danielle Meister, assistant secretary of homelessness solutions for the Maryland Department of Housing and Community Development, said there is no similar resource available in Maryland for young people on the verge of homelessness.

One challenge, Meister said, will be supporting Point Source Youth without cutting other state-backed programs and services.

“There’s not a lot of funding in general,” she said, but “there’s definitely a desire to see a program like this launch.”

Cohen cofounded Point Source Youth about 11 years ago, inspired by his and his brother’s own experiences as children who didn’t feel supported at home or school.

Cohen said his brother, Glenn, left home at 18 when he refused to attend college and had no place to turn. That fueled his experiences with drugs and addiction; he died of an overdose in 2022.

After finding trusted mentors who motivated him to attend college, Cohen spent the first years of his career advocating for HIV/AIDS treatment.

He said he saw firsthand how research-informed decisions could save lives and created Point Source Youth to serve as the safe haven his brother never had.

The organization eventually landed on the idea of providing direct cash assistance and decided two years ago to shift almost all its resources that way. He compared it to programs of guaranteed income payments for low-income families.

In Baltimore, Point Source Youth has teamed with a group called Thread, which pairs high school students with adult mentors. Thread cofounder Sarah Hemminger said the two organizations complement each other by centering young people in their mission.

Thread will help identify young people at risk of being unhoused, starting with 50 this first year, and will collaborate with Point Source Youth to develop individual housing plans and determine how much cash is needed.

Point Source Youth provides the cash and can help troubleshoot problems on the ground but otherwise doesn’t dictate how the money should be spent.

“There’s something about explicitly saying ‘I trust you are competent to make good decisions in your life,” Hemminger said. “It builds their confidence and sense of self while also building their skills.”

The Bloomberg paper found that young people most often used the money to cover their immediate housing needs, such as rent, transportation and utilities. A smaller portion of the money went toward cellphone bills, debt payments, savings, child care and food.

Ibriana Dorsey, who works for Point Source Youth as a consultant for the Baltimore project and is completing her associate degree at Baltimore City Community College, said she’s using her own experiences with housing insecurity to advocate for others.

“When I was looking for an apartment, I wish someone who related to me on this level was in that room speaking up for me,” Dorsey said. “I’m fighting in their corner.”