Expansion of Our Direct Investment Program with City of Sacramento
Guaranteed basic income program grows from 100 to 180 families
The Sacramento City Council approved an allocation of funding to expand United Way’s Direct Investment Program on June 21, allowing us to grow the number of families the program serves from 100 to 180.
The city is allocating $750,000 in funding from its American Rescue Plan dollars for the program, providing 80 new families with $500 in unconditional guaranteed income every month for one year. United Way’s current program is providing 100 families with $300 a month for two years.
“We are excited to partner with the City of Sacramento to expand our Direct Investment Program to more community members,” said Dr. Dawnté Early, president and CEO, United Way California Capital Region. “At United Way we’re committed to ending poverty for local families and what we know through our work and our relationships with community is that poverty is a policy choice. To truly end poverty, we must have meaningful policy changes at the local, state and federal level. The City of Sacramento is making the choice to address poverty directly by giving community members the money they need to meet their basic needs – housing, food cost and childcare for example. We are hopeful that this program can provide some relief to families in need during these difficult economic times.”
United Way’s Direct Investment Program is the first guaranteed income program launched in the California Capital Region. The program decreases income volatility, helps residents remain housed, pays for childcare, buys food and increases savings. 86% of current participants indicate they cannot pay cash or cash equivalent for an unexpected $400 expense. 72% of participants are women and people of color, and 1 out of 3 participants is working multiple jobs. The average participant would need two and a half full-time minimum-wage jobs to meet the Real Coast Measure for a household size of four, according to United Ways of California.
One participant said, “The money gave me the opportunity to pay out some of my bills, help me catch up on my rent and put extra food on the table for my kids.”
We launched our Direct Investment Program in July 2021 as part of a nationwide trend offering guaranteed income, particularly for communities historically undervalued and underinvested. Funding for the program came from a portion of the $10 million gift United Way California Capital Region received from renowned philanthropist MacKenzie Scott in December 2020. The program is one of our initiatives focusing on leveraging United Way’s access to financial capital in order to redress historical inequities in the region. Rather than mandating social workers, conditional services or specific direction, the program creates an environment where families come together to empower themselves and are trusted to improve their lives in their own way.
Unrestricted payments are given monthly to eligible program participants. Families have access to an online platform to set their own goals and share their experiences and unique expertise with other participants. Once approved for funds, the additional income is guaranteed and unconditional. Even if a participant begins earning more, funds are a commitment, as economic mobility is a primary goal of the program. We work with a third-party academic institution to measure impacts on income volatility, housing stability, employment, family dynamics and parenting, stress and coping, and household food security.
“We know that other basic income programs have been very successful in improving the financial stability of households currently living on economic margins,” said Mayor Darrell Steinberg. “We are putting dollars directly into the hands of our residents and empowering them to decide how best to use it.”
The program aims to invest in 1,000 families by 2025.