Oakland is experimenting with a new method to keep rising housing costs from pushing people out of the city or onto the street, adding to a growing list of innovative Bay Area test projects that experts hope will help ease the region’s homelessness crisis in the years to come.
Oakland’s “shallow subsidy” program will help 200 low-income households pay their rent for a year and a half by sending money every month directly to their landlords. It’s a novel approach that builds off a swelling interest in cash assistance programs ranging from universal basic income experiments to one-time homelessness prevention grants. If it works, city leaders hope someday to expand the idea and turn it into a long-term, tax-payer-funded staple of the region’s housing toolbox.
“This is the type of rapid intervention that can stabilize families, keep them from losing their housing and allow them to build their income to a moment of self-sufficiency,” Oakland Mayor Libby Schaaf said during a news conference.
Faced with a lack of affordable housing, a shortage of federal housing vouchers, and an overwhelming number of people living on the street, cities throughout the Bay Area are looking for creative ways to fill the gap between what people earn and what they have to pay in rent in one of the priciest markets in the nation. Many, including Oakland, San Francisco, South San Francisco, Santa Clara County and Marin County, are testing “basic income” programs that provide monthly cash stipends with no strings attached that can be used however families see fit.
Other homelessness prevention models provide one-time emergency grants to households facing a financial crisis. Oakland, for example, launched its “Keep Oakland Housed” program in 2018. Santa Clara County recently set a goal to expand its prevention system to 2,500 households by 2025.
Oakland’s latest experiment builds off those initiatives by sending average payments of $726 a month directly to participants’ landlords. The $3.4 million program is funded by donations from Salesforce CEO Mark Benioff and his wife, Lynne Benioff, the Crankstart Foundation and others. The first payments went to landlords in July.
The program targets people statistically shown to have a particularly high risk of becoming homeless — people who have been homeless in the past, who are spending more than 50% of their income on rent, who make 30% or less of the area median income, and who are from Oakland neighborhoods with high rates of gentrification and limited access to quality education, healthy food, healthcare and other resources.
The UCSF Benioff Homelessness and Housing Initiative will evaluate the program to determine if people who received subsidies were more likely to remain housed than those who did not. Part of what they’re attempting to prove is that it only takes a little bit of money to make a big difference.
Traditional housing vouchers generally use federal funds to pay for most of someone’s rent, guaranteeing that a recipient won’t spend more than 30% of their income on rent. But those vouchers are scarce. Nationwide, only about one in four households that qualify for a voucher receive one, said Dr. Margot Kushel, professor of medicine and director of the UCSF initiative. Many other people in need don’t meet the strict eligibility requirements. And even if someone does score a voucher, it can be tough to find a landlord willing to accept it.
Now, Oakland leaders are trying to determine if they can help more people and spread thin resources farther by offering smaller subsidies. The new pilot program is attempting to ensure participants don’t spend more than 50% of their income on rent.
“They’re trying to noodle around if we can’t get full subsidies for everybody, does a partial subsidy help?” Kushel said. “A full subsidy would be better, but is a partial subsidy enough?”
If the answer turns out to be yes, Oakland leaders hope to turn this small-scale, donation-based experiment into full-fledged, tax-payer-funded public policy.
A recent report by Alameda County identified 920 Oakland families most in need of this type of ongoing subsidy. To help them all would cost $10 million a year.
But the 200-family pilot is a good first step, Kushel said.
Ray Bramson, chief operating officer of Santa Clara County-based Destination: Home, agrees. We need basic income and other long-term subsidy programs that acknowledge the challenges low-income families are facing won’t go away after a one-time grant, he said.
“It’s exciting,” Bramson said. “I think this is a good time for us to be thinking about how we can get more support for families that are struggling. I think there are a lot of challenges ahead, but there’s also tremendous support at the federal and state level, and at the local levels.”
