South San Francisco sees success with guaranteed income program

Nagales said the money was used as expected and provided social and economic benefits and reduced stress. Data released by the city on Thursday showed that of the 160 residents, 82% of participants spent part of the money on food, while 87% spent it on rent. About 57% used it for utilities, 21% for clothes, 8% for transportation, 5% for education, 3% for insurance and 2% for medical costs.

The vice mayor said the program helped people put time and resources toward ways to better themselves, noting a participant was working multiple jobs, and the program funds allowed her to quit a job and go to night school for a higher paying job she now works at.

“I think that speaks volumes to the program that it gives the person an opportunity and gives them financial security so anxiety goes down,” Nagales said.

The Guaranteed Income Pilot Program launched in October 2021 and had the city provide $500 per month to 160 South San Francisco residents over a year in one of the first attempts to give low-income residents unrestricted funds. Guaranteed income programs pay residents unconditionally, without work requirements or other restrictions often associated with welfare systems. The city started the program to help residents facing economic fallout from the pandemic and who were worried about making it through the next day.

Recipients, who have already been chosen, were selected via a tiered lottery system from nearly 800 applicants, with priority given to foster youth transitioning out of care, single heads of households and those in the city’s lowest-income neighborhoods. The city paid for the program through federal pandemic relief funds and funds from San Mateo County and the Silicon Valley Community Foundation. The YMCA Community Resource Center in South San Francisco administered the program.

“The South San Francisco GIPP was launched in response to unprecedented economic turmoil from the pandemic faced by residents. Our City Council felt this was an important step to helping our residents with a critical, timely, and effective safety net,” South San Francisco Mayor Flor Nicolas said in a press release.

All 160 spots were filled by people earning at most $38,400 per person or $54,800 for a family of four. About 49% were single heads of households with children in the home, 39% were residents of South San Francisco’s lowest-income census tracts, 4.4% were formerly youth in foster care, and 82% did not have $400 or more in savings for an emergency.

Nagales said the program also helped people start a bank account to handle their finances and offered volunteer financial program literacy. Based on survey questions, Nagales said around two-thirds of people in the program plan to keep their bank account open. However, he noted there was still a lot more work to be done to try and break the cycle of poverty because 56% did not have an immediate plan to replace the income. The City Council will discuss later this year what to do with the remaining federal pandemic relief funds and if some of it can go toward a new program. The Vice Mayor hopes to get additional funding help from the county and other agencies.

The San Mateo County Board of Supervisors is also interested in a guaranteed income program. In January, it established a subcommittee to study ending poverty, with one of its goals being a guaranteed income program.