Why one Silicon Valley city is paying for gas and groceries

Mountain View might be the perfect place to test out a guaranteed income program, which aims to raise the quality of life for its struggling residents.

So when the city begins sending monthly $500 checks to low-income families at the end of this year, officials are hoping to not only help people just getting by, but learn how the local government can better support this demographic.

Nestled in Silicon Valley and home to tech behemoths like Google, Intuit and LinkedIn, as well as NASA’s Ames Research Center, the median household income in the city of 81,000 is a roughly $144,000, according to the U.S. Census Bureau. It’s also home to a growing number of people struggling to make ends meet, including hundreds of people living in RVs and the working poor. People who work full time earning a minimum wage of $17.10 per hour fall into the extremely low-income bracket in Santa Clara County.

Those eligible for this program are families or caregivers with at least one child under age 18 or a woman pregnant at the time of applying, and earn 30% of the area median income or less annually. In Santa Clara County, 30% of the median for a four-person household is $50,500 annually, according to state and county data. The money participants will receive is tax free, according to a city spokesperson.

Because each family may have different needs, the city’s two-year guaranteed income pilot program will have no strings attached to the checks. People can spend the money as they see fit—on food, rent, medication, clothing, medical services or gas. Mayor Lucas Ramirez said he’s hopeful the program helps lift people out of poverty.

While city officials may have high hopes for the ongoing cash payments, some say it might not be enough money to drastically improve the lives of people living on the margins. However, the financial security it could offer is a big help nonetheless.

“I don’t think it’s going to be impactful enough to break the chain of poverty,” María Marroquín, executive director of the Day Worker Center of Mountain View, told San José Spotlight. “Everything is so expensive. Just to live here, pay rent and go buy groceries, it’s just insane,” she said.

Marroquín said the program is a positive step in the right direction because it has no conditions attached and could benefit local shops and businesses. It could offer some financial security to domestic workers and day laborers, who often can’t be sure if they will find stable work each week.

“So just to have the certainty that at the end of the month you’re going to have $500 no matter what, if you work or don’t get work, I believe is really important for the community. No question about it,” she said.

City officials said 658 eligible applications have been received for the basic income pilot program, and 166 of those people will be randomly selected for the program and are expected to start receiving checks in December.

“What we’re hoping to see is that it provides just enough space, enough breathing room, for folks to complete training, to get certified, or get the education or credentialing they need to move upward economically, to get a better job and also to stabilize their family,” Ramirez told San José Spotlight.

Mountain View launched the program last month in conjunction with local nonprofit Community Services Agency of Mountain View, Los Altos and Los Altos Hills.

The program is currently estimated to cost about $2.57 million, with the bulk of the program’s funding coming from the city’s $15 million federal American Rescue Plan Act funds, as well as a $100,000 grant from the Silicon Valley Community Foundation. Some city general funds are also being used to cover the cost, according to city spokesperson Lenka Wright.

About $570,000 of the cost is for administration of the program, with $358,366 going to Community Services Agency and $212,403 going to the Center for Guaranteed Income Research at the University of Pennsylvania as a research partner.

Marroquín said it might be “wishful thinking” to expect $500 per month to be enough to allow people earning very low incomes go back to school or drastically improve their careers in just two years’ time.

“I don’t think it’s going to make a lot of difference for people who can barely eat and barely live in this area,” she said.

Tracking outcomes 

Whatever the impact locally, city officials, working with the Center for Guaranteed Income Research at the University of Pennsylvania, hope to collect data over the two years.

Stanford’s Basic Income Lab will be keeping an eye on Mountain View’s efforts, which adds to a growing list of more than 100 local governments offering direct cash assistance through guaranteed basic income programs around the country.

Sean Kline, associate director of the Stanford lab, said Mountain View’s program could further shift thinking around what a social safety net could look like at the state and federal levels.

“It’s a really important time to be reflecting on new ways we can support those who are struggling the most at a time of growing inflation and a housing crisis. We need to be thinking in bolder terms,” Kline told San José Spotlight. “What do we owe each other? What roles should the government be playing, particularly in times of crisis?”

Kline said after Stockton launched California’s first basic income program in 2019, those participating reported reduced depression and anxiety, diminished feelings of financial scarcity and saw new opportunities for self determination, goal setting and risk taking.

“It’s very hard to think about those kinds of decisions and looking to the horizon when you’re so consumed with the day-to-day necessities,” he said.

While guaranteed income programs may have been considered by some to be a radical idea five years ago, attitudes appear to be changing, in large part because of federal relief offered during the COVID-19 pandemic.

“We saw that providing individuals and families cash was one of the most swift, flexible and respectful ways of supporting people in a time of critical need,” he said.