Denver Basic Income Project midterm report shows "significant benefits" for the unhoused

bv Robert Davis

Photo: Acton Crawford/Unsplash

Programs that provide no-strings-attached cash payments can significantly decrease stress levels and increase feelings of hopefulness among unhoused folks, according to the Denver Basic Income Project’s midterm report, which was released on July 19.

The qualitative report captures some of the experiences of program participants in Denver and also sheds light on how they are spending their money and planning for bigger life changes like moving into a new home. It was released one day after Denver Mayor Mike Johnston declared a local state of emergency on homelessness.

A quantitative report on the project is expected to be released in October.

“These preliminary findings confirm our belief that providing basic income to people experiencing homelessness, with trust, dignity, and speed, will improve lives for the better,” said DBIP founder and executive director Mark Donovan.

DBIP was founded in 2020 under the premise of using cash payments to address homelessness in Denver, a problem that has been on the top of many minds in the city. The latest Pulse Poll from the Colorado Health Foundation found that 79% of Denverites think homelessness is either an “extremely serious problem” or a “very serious problem.”

Meanwhile, Denver’s unhoused population has increased by about 43% from around 3,300 in 2017 to nearly 4,800 in 2022, according to federal snapshot data. The city’s unsheltered population has increased by a staggering 141% from 544 to 1,313 over the same period, the data shows.

Program participants will receive payments for 12 consecutive months, although there are three different payment tiers. One group will receive $1,000 per month for the entire 12 months time frame. Another group received a one-time payment of $6,500 and then received $500 per month for the rest of the year. The control group is receiving $50 per month. DBIP participant demographics also mirror the demographics of unhoused folks in Denver, the report adds.

DBIP performed two small pilots of its program in August 2021 and June 2022. The program officially launched in November 2022 and began making payments shortly thereafter, according to the project’s website.

To date, DBIP has distributed around $5 million to 846 individuals and families that are participating, according to the report. Funding for the project has come from the Department of Local Affairs, Dever’s Department of Housing Stability, and nonprofit organizations like the Colorado Trust, Donovan said.

Participants that had bank accounts received their payments through either debit cards or ACH transfers from DBIP, Donovan said. Some participants also received cell phones so they can check their bank balances. Donovan added that DBIP has also provided support to replace lost or stolen cards for participants as well.

Outside of the financial benefits, Colorado Coalition for the Homeless Chief Public Policy Officer Cathy Alderman said the report also found that cash assistance improves the overall health and well-being of people experiencing homelessness. CCH is one of the 19 community-based organizations that has helped connect unhoused folks with DBIP.

Some participants shared testimonies about how DBIP helped them feel less stressed and improved their outlook on life. Others reported spending their money on groceries, transportation, or mending relationships with friends and family. A small portion of participants also used some of the money to do something nice for themselves, according to the report.

“It’s not enough for someone to simply get a home. You can see the weight of hopelessness lift off of these individuals," Alderman said. “People have the opportunity to take a step back and say “What’s the next best move?” instead of only asking “What do I have to do to survive today?”

Going forward, DBIP researchers like Daniel Brisson at Denver University’s Center for Housing and Homelessness Studies said they are paying attention to the potential “benefit cliff” that some participants may face when the program ends later this year. A benefit cliff refers to a sudden or unexpected decrease in income from benefits like DBIP or public programs like Social Security or the Supplemental Nutrition Assistance Program.

DBIP could collect data about potential benefit cliffs during exit interviews with program participants, Brisson said, but that data is not part of the program’s original framework.

“We’d like to sustain this type of programming for as long as possible so we can learn what happens when people don’t face that benefit cliff,” Donovan said. “This is something that has never been done before, and that’s why this kind of research is so valuable.”