The billionaire tech boss gave the money to the “Mayors for a Guaranteed Income” group, which will start basic income pilots in 30 cities across the country.
The group is led by mayor Michael Tubbs of Stockton, California, who has created a similar programme in his city.
He established the group earlier this year to help other civic leaders establish their own versions.
Basic-income programmes give a set amount of money on a regular basis to residents to help alleviate poverty.
The Twitter CEO’s donation will give all 30 cities $500,000 to help fund their schemes.
Participants in Stockton’s scheme get paid $500 a month, but each city can structure theirs how they see fit.
“Thank you Mayor and to all the Mayors of @mayorsforagi for these universal basic income pilots! I hope they inform federal policy in the future,” tweeted Mr Dorsey.
The new donation came on top of $3m that Mr Dorsey had already given to the group.
Mr Tubbs said the money was crucial as the economic impact of the pandemic continues to hit communities.
“So many of our constituents were in food lines for Thanksgiving,” said Mr Tubbs.
“We have people calling our offices asking how they’re going to pay for their water bill or their utilities or folks who are terrified about eviction moratoriums expiring.”
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