An experiment to pay people who were homeless in Denver with no limits on how they could spend the money led to twice as many people in stable housing, according to researchers who released their one-year report Tuesday.
More than 800 people were selected to participate in the Denver Basic Income Project while they were living on the streets, in shelters, on friends’ couches or in vehicles. They were separated into three groups. Group A received $1,000 per month for a year. Group B received $6,500 the first month and $500 for the next 11 months. And group C, the control group, received $50 per month.
About 45% of participants in all three groups were living in a house or apartment that they rented or owned by the study’s 10-month check-in point, according to the research. The number of nights spent in shelters among participants in the first and second groups decreased by half. And participants in those two groups reported an increase in full-time work, while the control group reported decreased full-time employment.
The project also saved tax dollars, according to the report. Researchers tallied an estimated $589,214 in savings on public services, including ambulance rides, visits to hospital emergency departments, jail stays and shelter nights.
The $9.4 million project was funded by a mix of public and private money, including $1.5 million from The Colorado Trust and $2 million from the city of Denver’s pot of federal pandemic relief money. The University of Denver’s Center for Housing and Homelessness Research collected personal stories from the participants and studied the outcomes of the project. (The Colorado Trust funds a reporting position at The Colorado Sun.)
Among the other interesting findings:
- There was no statistical difference in people’s reported use of illegal drugs. On average, people reported using illegal substances somewhere between zero and four times per month, both at the start and the end of the study.
- Stress and anxiety levels reported by participants were slightly higher at the end of the study compared to the start, though researchers speculated that participants likely were worried about the end of payments.
- Parents of kids under 18, however, reported statistically significant improvements in “parental distress” after receiving money for 10 months.
One participant, a mother of two named Anita, is now living with a family member after previously living in her car or outside. She told researchers the monthly payments she received were a “leg up” and that she now relies on the payments for hygiene items, child care expenses, transportation and other bills.
Another participant, a single mom who lives with her parents, said she was able to start a new job, buy a car and enroll in school. She also reported that she was able to make more “happy memories” with her children and is looking into moving into her own housing.
Participants were surveyed at the start of the program, after about three months and after about 10 months. Participation in the surveys dwindled throughout the project, however. About 630 of the 807 enrollees took the initial survey, but only about 70% of the 630 participated in the three-month survey and 60% in the 10-month survey. Participation in the survey was not required to receive the money.
While many enrollees said they were concerned about what would happen to them when the payments stopped, “only two participants mentioned a panic of what they would do when the funds ended,” the study said.
The study, which began in November 2022 with payments to the first group of participants, has been extended for an additional eight months, until September, and organizers are attempting to raise money to extend it further. New funds include another $2 million from the city of Denver.
Researchers said they need more time to understand the relationship between the amount and timing of “guaranteed income” and how it affects people who are homeless.
Mark Donovan, founder and executive director of the Denver Basic Income Project, said his goal is to make the project permanent.
“We believe the first year of the program established a sense of stability for participants, and the second year and beyond is when individuals can experience an even more profound transformation,” he said in an emailed news release. “We aim to persuade policymakers to establish permanent funding streams for programs like ours.”
Of the $9.2 million spent on the program in 2023, $7.1 million went to participants. The rest went to delivery and fund-raising costs.
The average age of participants was 44, with the youngest 18 and the oldest 86. About 34% participants were white, 27% were Black, and 7% were Indigenous or Native American.