Adi Talwar

The homeless shelter system's PATH intake center in the Bronx.

The city is proposing a savings program where employed homeless persons who reside in a shelter will be mandated to hand over nearly a third of their earned monthly income. The de Blasio administration says the savings will aid those residents in their eventual transition out of the shelter system.

As part of the proposed Income Savings Plan program, New Yorkers experiencing homelessness and residing in a shelter will be required to deposit a portion of their earned income, generally 30 percent, to a savings account.

The first phase of the program will begin with employed single adult individuals residing in the city’s Department of Homeless Services (DHS) shelters with earned income high enough to make them ineligible for cash assistance.

As the program continues, DHS plans on applying the program to additional populations with earned income such as families with children, a move tentatively scheduled for next year. The savings would be maintained by the Department of Shelter Services (DSS) and would become available once program participants exit the shelter. The savings amount is based on earned income adjusted by how much time the participant spends in the shelter.

“Our goal is to assist New Yorkers with saving in order to more effectively help them plan for the future and get back on their feet, ensuring they can utilize savings from earned employment income to move out of shelter into housing and setting them up for sustainable, long-term stability,” said DSS spokesperson Isaac McGinn in an email statement.

As of August 27th, there are 37,674 adults and 21,279 children, totalling 58,953 persons within the city’s shelter system.

In the 1990s, New York State law required shelter residents (outside of the five boroughs) to pay a portion of their earned income, including income from public benefits, in order to stay in the shelter. In 2010, the law was amended and instead asked residents to voluntarily save a portion of earned income in a savings account. But the de Blasio administration said the voluntary program was ineffective and in 2018 the state gave the approval to have the plan to be mandatory rather than voluntary.

Homelessness advocates feel the Income Savings Program is a worthy effort but doesn’t address the root causes of homelessness.

“The overall takeaway is that people are not homeless because they’re not able to manage their money. They are homeless because they can’t afford rent in New York City,” Coalition for the Homeless policy director Giselle Routhier.

“It is generally another bureaucratic barrier,” she says of the savings program. “It’s certainly preferable to a situation when a person is required to pay rent.”

“I think there are some concerns that we’ll have to monitor once the program goes into effect, the way that they’re describing it, to make sure people are not being harmed by the policy and that they’re able to access their money if they do have an emergency circumstance or when they’re moving out of shelter,” she adds.

Other advocates said saving money was not a priority for homeless New Yorkers when they are fighting on a daily basis for the basics such as food and shelter.

“I think it’s certainly a good idea to help people save money,” said Marc Greenberg, the executive director at Interfaith Assembly on Homelessness and Housing. But homeless people might have less flexibility to save than most New Yorkers. “They’re probably spending a good amount of their money on just surviving. If you are living in a shelter, you’re not able to cook at home. You need to buy from someplace else. If you’re working but you’re not living then you have to spend money on transportation. So I think the concept is a good one, but it needs to be personalized for each individual.”

Greenberg said it would be better to make the program optional, perhaps with an option to have the money invested so it could grow and he added that the program should be coupled with financial literacy workshops.

“The point is you want to help individuals to develop some savings, but you can’t just mandate that a certain amount of their money has to go into savings and you have to help them figure out what their costs of living are and see what fits in their budget. I think that’s the key. It’s not a one size fits all. I think the concept is good and theory, but the real point is to help people develop some savings, but also to help them figure out how to do it without being a hardship to them,” said Greenberg. ” We have to treat them like dignified human beings because they are human beings.”

The city said the program would include information for participants to help navigate their budget. Participants will receive a monthly savings statement detailing the total of their funds and what they owe the following month. Their funds will be held by DSS and made available once they transition out of the shelter system.

But participants who do not deposit the required funds into the savings account are at risk of noncompliance and could lose their shelter services.

“If a participant does not set aside the required savings, DHS will engage with the individual through collaborative case conferencing to discuss program requirements, encourage compliance, and provide assistance or clarification or guidance on the program and/or connect participant to financial counseling as needed. Failure to resolve following engagement by shelter staff can result in referral to rooms for which they can pay rent. Shelter residents will have full due process protections and several touchpoints/ample opportunities to resolve,” in an email to City Limits.

The Income Savings Plan program is expected to be fully implemented 30 days after the public hearing which has been scheduled for Sept 24, 2019 at 2:00 p.m. in the Second Floor Auditorium at 125 Worth Street in Manhattan. You can submit comments to DHS through the NYC rules website at

8 thoughts on “Mixed Feelings About Mandatory Savings for NYC Homeless

  1. It is deeply offensive that the Department of Homeless Services (DHS) has proposed a rule that suggests that homelessness is an individual problem rather than a crisis that needs to be addressed in a systemic way.

    As the article points out, the DHS proposed a rule that would require employed shelter residents to deposit 30% of their income into a fund maintained by DHS. DHS would then return the funds when participants exit the shelter. If a participant fails to make the required deposits while they stay in the shelter, the consequence may be termination of shelter placement (after some minimal due process).

    The proposed rule is described as a way to “help . . . employed individuals get back on their feet and exit shelter by budgeting for and developing savings while in shelter.” However, this statement shows that the DHS proposal is rooted in a misguided belief that the problems faced by shelter residents stem from people’s failure to be responsible and to uplift themselves. This is a distraction from the real systemic causes of homelessness.

    Rather than focusing on individual behavior and imposing a system of consequences that will most certainly worsen the lives of the most vulnerable New Yorkers, the City of New York should be making serious commitments to tackling the housing crisis. More than 60,000 people sleep in a shelter each night in New York City, according to the Coalition for the Homeless. The City needs to address these numbers by building enough housing targeting the neediest New Yorkers. As stated in the Coalition for the Homeless’s August 2019 report, Mayor de Blasio’s much-touted housing plan has exacerbated homelessness. Mayor de Blasio used limited resources to subsidize the building of expensive apartments, creating or preserving 60,000 apartments with rents above $1,700 per month, while setting aside just 15,000 apartments for homeless households. These are not nearly enough for people who are the most neediest – people who cannot afford to spend $800 per month on rent, if that much. The proposed rule is unworkable as well, because for many people, saving 30% of their income will mean not taking care of other basic needs.

    The housing crisis will not be solved by individuals saving a little here and there. DHS and the City of New York should be ashamed for rolling out a rule that reflects a belief that it is up to individual actors to overcome the housing crisis in this city. The de Blasio administration must pay attention to the neediest New Yorkers by building adequate housing at the lowest rent levels and by building housing specifically for homeless individuals.

  2. De Blasio’s NYC allows real estate brokers and landlords to DEMAND that renters EARN 40X RENT a year AND cheapest rent for a 300 sq ft studio is around $1600 in areas far from public transportation-the minimum wage for those requirements would be $64,000. But minimum wage is less than half that! The number one issue with homelessness is affordable housing and the city’s greed!

    Make the city affordable, reduce the greedy real estate practices, reduce your CORPORATE WELFARE in the form of “tax breaks” before you start blaming the disenfranchised homeless.

  3. The city should stop taxing the landlord’s thus creating higher rents if I was a landlord and the city taxed me I would do the same thing and raise my rents.

  4. This proposal inherently blames low-income people of color for historic and systemic conditions. It is offensive and misguided. New York City desperately needs subsidized housing, not yet another way to punish poor people or make them feel like criminals. Families will lose their shelter if they can’t save this amount? Sounds punitive, not helpful. Will social workers come around and ask what families spend their money on, and whether they have a fancy tv or nice perfume, too (as was documented in the 1990’s)? Poor folks can’t enjoy anything, can they? Do more, and do better, NYC. This plan is despicable.

  5. Pingback: Mixed Feelings About Mandatory Savings for NYC Homeless | MIDTOWN SOUTH COMMUNITY COUNCIL

  6. This saving plan program is a joke. The NYC city agencies can’t even balance their own financial books but they have the nerve to present a plan to sanction homeless employed DHS clients to save 30% of their income. This would be an ideal plan if we had an abundance of low income housing in NYC which we don’t. This proposed income sanction is racist and offensive to the predominantly black and brown population in NYC DHS shelters. People of color are not responsible for the systematic racist policies establish to keep them in these situations. Most of the time these clients are already in low income jobs and spend most of their money on food, transportation, and repairing their credit. Even with the Fare Fairs initiatives it is still a big financial hit on the poor to pay for transportation. Fare Fairs enrollment is already low due to the city’s poor campaigning. Most landlords will not accept you if your credit score is not between 600 to 800 therefore even if homeless individuals saved 30% of their income, they won’t qualify for most of NYC housing opportunities due to poor credit. Our taxes pay for these shelters regardless if we reside in them or not therefore the DHS working homeless clients needs to have final say in DHS policies when it comes to how they save their income and DHS shelter rules. Homeless employed individuals are already paying to be in the shelters through income taxes taken out if their paychecks every pay period. Most shelter clients can’t even retain their jobs due to the poor quality of life issues in these shelters which usually leads them down the path to mental illness and substance abuse issues. These policies makers are not qualified for the position they hold and Mayor Bill de Blasio is to blame because he was the one who appointed them. If you look at how De Blasio selected these unqualified individuals into office you will see it is similar to how Trump appointed his political cabinet and agencies members. They both appointed their friends, family members, and mostly unqualified Whyte men. This is what happens when you have inexperienced individuals running the most important political offices in the city and country. 60,000 homeless may seem like a large number but we are living in a city that is over 1 million in population therefore these homeless and affordable housing issue can be fixed because we are in one of the richest city in the world.

  7. I totally agree with the savings plan. It is an essential way to begin the transition from spending to saving. It’s a tool that a lot of people who were never taught how to save will find useful and also brings awareness into their spending habits. I know rents are high in NYC; I am aware of that myself being a resident, but if I didn’t know how to save just a little at a time; I’d have nothing. Let’s not criticize the program and make a success from it and begin to move forward in a productive way.

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