A Universal Basic Income Project in Denver Had Surprising Results

By: Stephanie Bontorin | Published: Jun 19, 2024

The Denver Basic Income Project was launched to improve the lives of people experiencing homelessness in the city. The pilot program sent direct cash payments to over 800 people in Colorado.

With the first results in, proponents of the plan say that 45% of participants secured housing, while more than $590,000 of taxpayer money was saved in public service costs.

How Did The Project First Begin?

In the fall of 2022, the Denver basic income pilot first began. The program was created to combat the rising instances of homelessness in the Mile High City.

A man wearing a dark jacket and blue jeans lays on the side of the sidewalk

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Despite frigid winters, the number of people experiencing homelessness was rising substantially. Many people attribute the issues to the rising cost of living felt nationwide.

Cash Payments, No Strings Attached

Although critics of the plan had reservations, hanging out cash to over 800 people in the city allowed almost 400 participants to secure safe housing. The rules of the measure were clear; anyone receiving funds was allowed to spend the cash on whatever they wanted.

A faceless person hands over hundreds of dollars in cash to another person

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After a year of payments of $1,000 a month, 45% of the recipients were able to secure their own house or apartment.

Several Unintended Benefits of the Program

One unintended benefit of the program is that it saves taxpayers hundreds of thousands of dollars. While many people might say that handing out cash to the homeless wastes taxpayer money, the reality is that it saves resources and cash in the long run.

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A year after the pilot program took off, emergency visits, jail stays, and nights spent in temporary shelters were down considerably. When people have access to regular medical care and adequate shelter, they are far less likely to be arrested or need emergency services, which cost much more. The total savings to the city are $589,214.

The Program Gave Funds in Different Ways

The funds were given out in different ways, and the results of the alternate methods will be tracked to see what is most effective.

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The participants were divided into different groups. One group received $1,000 per month for a year; another group was given $6,500 upfront, followed by $500 per month; a third group received $50 a month as a control group.

Who Funded the Project?

The funding groups include the city of Denver, the Colorado Trust, and a generous anonymous foundation.

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To date, more than $9.4 million has been handed out to participants with the hopes of ending homelessness.


Universal Basic Income Is a Popular Strategy To Reduce Poverty

Programs like Universal Basic Income (UBI) have been used in several cities to reduce poverty and instances of homelessness.

A small blue tent sits on a side walk next to a large red building

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Compared to more directed programs like SNAP or Medicaid, UBI allows participants to spend money exactly where they need it. Perhaps they have outstanding medical bills or past due rent; cash in hand easily resolves these issues so that people can move forward.


Participants Also Found Stable Long-Term Jobs

Aside from being able to afford housing and paying down outstanding debts, keeping people on the streets, many program participants were also able to secure long-term employment.

A female employee is pictured standing at the self-checkout area

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A small step into financial stability can butterfly effect a person’s life. Nick Pacheco, a participant engagement coordinator, said at a press conference that the basic income project puts low-income families on “an equal playing field.”


Freedom From Poverty Can Improve the Lives of Many

Pacheco also remarked that the project results in “freedom from poverty not being able to reach your goals.”

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Many participants in the program were behind on bills or could not pay rent. A little bit of extra funds is all that is needed to allow someone to return to work or expand their education.


Money Can Buy Happiness

Participants in the program experienced improved mental health and reported spending more time with their family and friends. The Mayo Clinic produced a study to show the importance of spending time with loved ones as a way to benefit mental health.

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Someone experiencing homelessness and unable to properly clean or feed themselves is more likely to retreat from their circle of family and friends out of shame and embarrassment instead of leaning on them more. UBI offers participants enough money to rent a room and share the dignity of regular life.


Financial Stress Becomes Alleviated Immediately

One of the biggest issues facing many people today is the intense strain of financial stress. Regular bills like groceries, rent, and medical care have skyrocketed in recent years, causing many to feel like they need to choose between their basic needs.

Young couple is stressed as they go over bills at the kitchen table

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Instead, initiatives like UBI allow people to spend a bit on every aspect of their lives and improve their overall well-being. After paying debtors, many participants reported raising their credit scores, which allowed them to take out a new credit card or rent an apartment on their own.


Other States Are Following Denver's Lead

Cities in California and New Mexico have also proposed legislature to introduce UBI programs.

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Teri Olle, the director for Economic Security California, said “People are really seeing the power of those pilots and the power of giving people money and trusting them.” The program’s do not immediately solve the homeless crisis, but it’s proving an excellent way to start.