This week, the Santa Clara County Board of Supervisors approved extending their first-of-its-kind pilot program that provides universal basic income to transition age foster youth. The pilot program, created at the request of Senator Cortese in 2020, has been extended for an additional six months with an added investment of $500,000 from the County.
“Our pilot program in Santa Clara County is yielding clear results and inspiring a growing number of similar direct cash assistance initiatives across the nation. Foster youth in this program are reporting they are able to use these funds to sustain their basic needs and to improve their credit score,” said Senator Cortese. “And with my bill, SB 739, moving forward, we have the opportunity to bring this successful model statewide.”
SB 739, the Universal Basic Income for Transition Age Foster Youth Act, would provide unconditional and direct cash assistance of $1,000 a month to approximately 2,500 youth aging out of the Extended Foster Care Program in California in a pilot program administered by the Department of Social Services over the course of three years. The bill has passed the State Senate and is set to be heard in the Assembly Human Services Committee on June 30th.
A recent report on the County’s pilot program included the following: “When asked open-ended questions about the impact of the funding and plans to maintain their current lifestyle after the pilot ends, respondents reported that the funding has allowed them to cover basic expenses and some savings. Many hope to save enough during the pilot to maintain stability after the pilot ends.”
“For those participating in financial mentorship, they have reported significant increases in their credit scores, a feeling of empowerment to obtain financial resources, and one youth was able to establish and meet a savings goal for a down payment on a house.”
Senator Cortese pointed to other jurisdictions exploring guaranteed basic income as a means to uplift underserved communities, including the newly announced pilot in New York City entitled the “Trust Youth Initiative” – the nation’s first direct cash program for youth experiencing homelessness in which 30-40 young adults experiencing homelessness will receive $1,250 per month for up to 2 years.
There are no fiscal implications associated with receiving this informational report.
REASONS FOR RECOMMENDATION
As part of the Transition-Aged Youth Basic Income Pilot program, Administration prepares quarterly programmatic updates on the pilot to the Children, Seniors and Families Committee (Committee). The County has provided nine months of payments to youth participating in the pilot program. The six-month update survey was offered in March 2021. Financial mentoring has also been provided to participants. Given the pilot program’s guaranteed income structure, participation has been voluntary for both survey responses and financial mentoring. As a result of the voluntary nature, participation has been limited for the surveys and financial mentorship. Of the 72 participants, the participation levels for the surveys and financial mentoring are below:
|September 2020||March 2021|
*completed two sessions or more
When youth were asked about barriers to participation, the response was about the time commitment involved. The financial mentoring provides a flexible schedule around the participant’s availability and the survey has been streamlined to minimize the time needed to complete. The County has also conducted phone and email outreach, with minimal impact to participation.
Administration recommends extending the pilot for an additional six months and providing incentives to participants for responding to the surveys and completing the financial mentoring component. This will increase data available to measure the effectiveness of the pilot and inform future program recommendations, as directed by the Board of Supervisors. The funding needed for a six-month program extension is $500,000 in one-time costs and included as part of the revised recommended budget, which will be considered by Board of Supervisors on Monday, June 14, 2021 (Item No. 14). If the Board approves the recommended budget with this revised recommendation, staff will meet with program participants to announce the extension, incentives, and discuss strategies to make participation as convenient as possible.
At the next quarterly programmatic update to CSFC on August 26, 2021, Administration will provide an update on additional measures taken to increase participation. Since the pilot has occurred during the pandemic, all outreach and interaction has occurred virtually, yet this may change during the six-month extension and have a positive impact on participation.
Highlights from March 2021 Survey
In addition to the baseline survey questions, the March 2021 survey asked additional questions regarding taxes, federal stimulus, financial mentorship, and how the $1,000 per month has affected their life. Of the 25 respondents to the March 2021 survey:
- 60% filed taxes,
o 47% of those who filed taxes said the pilot changed their tax filing by decreasing their refund, resulting in a lost benefit, or required them to seek professional assistance to complete their taxes.
- 52% of respondents received the Stimulus Check for COVID-19 personal or through a member of their family.
When asked open-ended questions about the impact of the funding and plans to maintain their current lifestyle after the pilot ends, respondents reported that the funding has allowed them to cover basic expenses and some savings. Many hope to save enough during the pilot to maintain stability after the pilot ends.
For those participating in financial mentorship, they have reported significant increases in their credit scores, a feeling of empowerment to obtain financial resources, and one youth was able to establish and meet a savings goal for a down payment on a house. Much of this was achieved based on the support from the volunteer financial mentor who not only provided insight, but provided as a safe space of non-judgment to discuss how to reverse previous financial missteps that have created hardships.
Given the low response rate, it is not possible to draw strong conclusions from the survey data regarding the impacts of the basic income payments.
Utilization of Prepaid Debit Cards
In February 2021, only two participants withdrew the full $1,000 on the 15th when the funds became available. There were also only two instances of participants utilizing the cards for a cash advance. However, in March 2021, the number of $1,000 withdrawals on the 15th increased to nine participants and eight instances of the cards being utilized for a cash advance. Data was not available at the time of this report for April 2021, so the August CSFC report will include additional information on the utilization of the prepaid debit cards. Transfers to savings accounts remained small but steady during the two months.
At the August 13, 2019 Board of Supervisors meeting (Item No. 14), the Board approved a referral from Supervisor Cortese requesting that Administration and County Counsel return to the Board, through the Children, Seniors, and Families Committee (CSFC), with options for implementing a basic income pilot program under which young people transitioning out of the foster care system would receive unconditional cash payments.
At the December 3, 2019 Children, Seniors, and Families meeting (Item No. 8), the Offices of the County Executive and County Counsel provided a report with options for implementing a basic income pilot program for current and/or former foster youth.
At the April 21, 2020 Board of Supervisors meeting (Item No. 21), the Board provided direction to Administration to report to the Board with a proposed budget allocation for the implementation of a Pilot Program from June 2020 through May 2021 that is responsive to the current needs of County foster youth during and after the COVID-19 public health emergency to serve all youth aging out of foster care who are over 21 years old and up to 24 years old in Santa Clara County with a basic income of $1,000 dollars per month; that Administration engage in partnerships with service providers experienced in mentoring and assisting transition-age foster youth; and, that Administration continue efforts to seek public private partnerships and private foundation funding. The Board also directed Administration to report to the Board with an explicit and robust evaluation component of the recommended Pilot Program prior to implementation, including financial implications and determining factors of those designated as foster youth.
At the May 12, 2020 Board of Supervisors meeting (Item No. 19), the Board approved recommendations relating to implementing a Transition-Age Youth Basic Income Pilot Program for former foster youth. This action provided for a $1,000 per month basic income for one year to 72 former foster youth who meet the following eligibility criteria:
- Born between January 1, 1996 and April 29, 1996;
- Santa Clara County dependency case between age 16-21;
- Currently residing in Santa Clara County; and
- Consent to intake process, which includes information to process the basic monthly income.
At the August 25, 2020 Board of Supervisors meeting (Item No. 20), the Board held a referral to Administration at the request of Supervisor Simitian to June 2021. The referral requested Administration to report to the Board with options to expand the Universal Basic Income pilot program to include additional Transition-Aged Youth.
On October 22, 2020, the first programmatic update was presented to the Children, Seniors and Families Committee regarding the Transition-Aged Youth Basic Income Pilot. The update included information pertaining to activity after approval of the pilot program on May 12, 2020 (Item No. 19). This included information regarding:
- Recruitment efforts;
- Prepaid Debit Cards through Community Financial Resources;
- Financial Mentorship with MyPath and Excite Credit Union;
- Baseline Survey;
- Fundraising Efforts; and
- Next Steps.
At the November 10, 2020 Board of Supervisors meeting (Item No. 13.k.), Supervisors Chavez and Ellenberg requested Administration report to the Board on a date uncertain with the feasibility of enrolling youth in the Transition-Aged Youth Basic Income Pilot program on a rolling basis rather than static periods.
On February 25, 2021 (Item No. 12), the Committee received the second programmatic update. The programmatic update included a response to the feasibility of enrolling youth in the Transition-Aged Youth Basic Income Pilot program on a rolling basis rather than static periods. Chairperson Chavez requested that Administration report to the Board of Supervisors during the Fiscal Year 2021-2022 Budget process relating to options to continue and expand the program.
CONSEQUENCES OF NEGATIVE ACTION
The Committee would not receive this report relating to the Basic Income Pilot program for transition-aged former foster youth.