Watch CBS News

Here's How People Receiving 'Free Money' In Stockton Are Spending It

STOCKTON (CBS13) — An experimental program in Stockton that gives low-income recipients $500 a month with no strings attached is now releasing some data to show how some of that money is being spent.

According to the first tracked spending data released by Stockton Economic Empowerment Demonstration (SEED), 40% went to food, 25% to merchandise and 12% to pay utility bills.

Stockton Mayor Michael Tubbs calls it a free money success story.

"For me, the data illustrates a couple things, mainly that our hypotheses going in were correct," Tubbs said. "Folks are using the money how we all would use the money because they're not aliens, they're our neighbors, it's a representative sample of us."

READ: Testing The Impact Of Universal Basic Income In Stockton

Not all the money given to participants is tracked. Forty percent of recipients transferred the free money from their debit card where the money is first delivered, to other accounts that are not traced. The purchases that are made off the debit cards are not detailed in the data.

Sukhi Samra is the SEED program director

"So unfortunately, the data isn't that granular, so the data is collected on the prepaid debit card so we get broad spending categories, such as food, such as transportation," Samra said.

READ MORE: Why Aren't People Signing Up For Free Money In Stockton?

The data does track who is getting basic income payments. It shows 43% are working full or part-time, 20% are disabled, and not working, and only 2% are listed as unemployed.

"This notion that there is bunch of people who don't want to work, who just want the government to provide for them, is just not true," Tubbs said. "If we made all of our political decisions off data our world would look radically different."

The free money program lasts 18 months for 125 residents who were selected at random in low-income neighborhoods.

Mayor Tubbs said other cities looking at Stockton as a model for a program like this include Chicago and Newark.

View CBS News In
CBS News App Open
Chrome Safari Continue
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.