Santa Clara County explores universal basic income for former foster youth

Santa Clara County Supervisors are looking into providing a universal basic income for young adults aging out of the county’s foster care system. If approved, it would mark the latest in a growing number of experiments testing whether no-strings-attached cash payments can improve the health and well-being of at-risk people.

The framework of the pilot program is still under development, but it could mean that the roughly 58 young adults aging out of the foster youth system each year would be eligible for between $1,000 and $2,000 in monthly payments from the county. The money would be granted without any restrictions on how to spend it, and would likely last for one or two years.

If approved next year, the county’s pilot would follow several recent experiments with universal basic income (UBI) programs, in which recipients get unrestricted cash payments from a nonprofit or government agency. A $500 monthly income program launched in Stockton in February, and the research arm of Mountain View-based Y Combinator is also planning to test a UBI program that would provide $1,000 in monthly payments to 1,000 participants across two states.

One of the most well-publicized basic income experiments took place in Finland in 2017 and 2018, in which 2,000 employed Finns received 560 euros a month with no spending restrictions. While the recipients were not more likely to find work during the trial — a key component of the program — they reported feeling less stressed, more financially secure and “more confident in one’s own future,” according to the government’s report.

Though referred to as a “universal” program, Santa Clara County’s basic income pilot would take a narrow aim at young adults coming out of the foster youth system, who are suddenly faced with losing access to a robust network of support services.

Studies have found that children in foster care are often subject to poverty, trauma, substance abuse and mental health issues, and struggle to be self-sufficient in early adulthood, according to county staff. A 2006 Bay Area study found foster care “alumni” are at heightened risk of homelessness, unemployment, incarceration and dependence on welfare.

County Supervisor Dave Cortese, who proposed exploring a UBI pilot in August, said such a program could be a “potentially transformative intervention” for adults coming out of foster care. It would also be a pretty big divergence from what the county has already done, which is provide funding for specific services and uses.

“It’s not prescribed to housing, it’s not prescribed specifically to health care deductibles or medical costs or registration for school or groceries,” Cortese said at the August meeting. “It is the idea that, much like the few UBI pilots that are out there, it is a much more fungible or flexible fund.”

County supervisors unanimously agreed at the time to have staff explore the idea. Supervisor Joe Simitian said he believes there is an ongoing struggle to support foster youth in the county and across the state going back at least 20 years, and that well-intentioned legislation has done little to move the needle.

“Here we are 20 years later and frankly, these kids are still not having the level of success that they can and should have after they come through our system. What we are doing now does not work,” Simitian said. “I think it behooves us to ask ourselves are there different or better ways we can address the needs of these kids.”

Who will benefit?

At a committee meeting last week, county staff laid out a menu of options for how the county’s basic income program could look, including the size of the payments, the duration and, most importantly, which foster youth and former foster youth should get the money.

County staff recommended that, while Stockton residents might get a big boost from $500 each month, a more appropriate basic income in the Bay Area should land somewhere between $1,000 and $2,000. The money could be based on income eligibility requirements, and could be provided over the course of 18 months or two years.

The basic income program could hit a snag if, by accepting the county’s money, former foster youth are no longer eligible for other government benefits including Medi-Cal, CalWORKs, CalFresh or General Assistance. It could also create problems for recipients who immigrated to the country and are seeking U.S. citizenship.

County staff suggested that the sweet spot would be to provide money to “transition age youth” ages 21 to 24, who are eligible for fewer services than younger adults. The vast majority of those who are between the ages of 18-20 are still eligible for “extended foster care” services including housing support, social workers, stipends and financial help for college tuition.

While the two members on the committee — Cortese and Supervisor Cindy Chavez — made no strong commitments at the Dec. 3 meeting, they both agreed that there should be no “control” group of former foster youth who don’t receive money. Chavez argued the county has plenty of data showing the challenges that foster youth face, and that there’s no point in “disadvantaging or traumatizing anyone,” while Cortese said the county shouldn’t be the business of picking winners and losers for the sake of testing a pilot program.

“I understand that an experiment that would maybe hold some more statistical validity would be to sort of split the population and have the ‘haves’ and the ‘have-nots,’ but I don’t think that’s us,” Cortese said. “I don’t think we should do that, even though it might give us a finer set of data points.”

Sparky Harlan, CEO of the Bill Wilson Center, told the Voice that she believes that the UBI already has a proven track record and would be a great idea for foster youth, particularly in reducing homelessness — which is a major problem that is most acute in people ages 21 and 22 when they’re making the transition into adulthood. She agreed that people ages 21 to 24 would be the ideal population, as young adults up to age 21 are still technically in foster care.

The Bill Wilson Center offers a range of services to children and young adults, including counseling, homeless support services, transitional housing and provides temporary housing in Mountain View for foster youth.

Harlan said she believes the basic income program would help former foster youth learn how to manage money and make financial decisions on their own, rather than receiving assistance through highly prescriptive grant programs. She pointed to one example where the state decides what car repairs are worth making, based on the value of the car, which completely takes the decision out of the hands of the recipient.

“The state should not be telling them the car should be worth a certain amount,” she said. “That’s a decision we make, as an adult, to weigh whether we should or shouldn’t. Sometimes it’s a good decision, sometimes it’s not, but we make the decision ourselves.”

Though the details of the pilot are still being worked on, Harlan said she feared the basic income program’s scope will end up too narrow, leaving out people who could use the money the most. Children placed in homes that are “permanent” on paper, but unstable in reality, exit the foster care system on their 18th birthday and are no longer eligible for services. Many of them end up on the street and don’t appear eligible for the county’s pilot UBI program.

“Often times when they turn 18 they become homeless,” Harlan said. “That’s the population that could really use this income even more.”

The committee is tentatively scheduled to get a second review of the pilot program in March before it returns to the Board of Supervisors for a vote in April, in time for the 2020-21 budget process. A $1,000 basic income program would cost an estimated $700,000 each year.

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Kevin Forestieri writes for the Mountain View Voice, the sister publication of PaloAltoOnline.com.

Kevin Forestieri writes for the Mountain View Voice, the sister publication of PaloAltoOnline.com.

Kevin Forestieri writes for the Mountain View Voice, the sister publication of PaloAltoOnline.com.

Kevin Forestieri writes for the Mountain View Voice, the sister publication of PaloAltoOnline.com.

Kevin Forestieri writes for the Mountain View Voice, the sister publication of PaloAltoOnline.com.