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Estimating the Value of Federal Housing Assistance for the Supplemental Poverty Measure: Eliminating the Public Housing Adjustment

Working Paper Number SEHSD-WP2017-38
Trudi Renwick
Component ID: #ti1317115354

Introduction

In 2009, the Office of Management and Budget’s Chief Statistician formed an Interagency Technical Working Group (ITWG) on Developing a Supplemental Poverty Measure. In March 2010, the ITWG issued a series of suggestions to the Census Bureau and BLS on how to develop a new Supplemental Poverty Measure (Observations from the Interagency Technical Working Group on Developing a Supplemental Poverty Measure). Their suggestions drew on the recommendations of the 1995 report of National Academy of Sciences (NAS) Panel on Poverty and Family Assistance and the extensive research on poverty measurement conducted over the past 15 years, at the Census Bureau and elsewhere. The ITWG suggested that the resource measure include the value of nonmedical in-kind benefits, including the value of housing assistance.

This paper describes the methodology currently used by the Census Bureau to estimate the value of housing assistance in order to add this value to the resource estimate used in the Supplemental Poverty Measure (SPM).  The paper then presents an evaluation of the impact of a small change to this methodology, the elimination of the public housing adjustment, on SPM poverty rate estimates and the aggregate value of housing subsidies. Unless noted elsewhere, this paper uses data from the 2016 CPS ASEC, that was data collected in February, March and April of 2016 with a reference period of calendar year 2015.

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