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April 19, 2005

Report: State losing billions
due to outdated federal poverty measure

Full Report

California will lose more than $2.1 billion in federal funding this year and next because the government uses an outdated measure of poverty, according to a new report by San Francisco State University economics professor Michael J. Potepan and Aimee Durfee of the National Economic Development and Law Center in Oakland.

The report was produced for the California Senate through a program of the Center for California Studies at Sacramento State. Potepan and Durfee will present their findings at 1 p.m., Thursday, April 21 at the Senate Office of Research at 1020 N Street, Suite 200 in Sacramento.

The researchers say California is among 23 states, including Florida and Texas, that are under-funded because of the poverty measure used by the government. Among other problems, the report notes, the official measure doesn’t take into account regional or state differences in housing and other costs.

The Census Bureau has developed a different poverty measure that the researchers say is more accurate. That measure would designate 1.8 million additional Californians as living in poverty – an average of 6.25 million a year in 1999-2002.

The authors will also discuss what the affected states might do to correct the problem and how California might measure poverty more accurately on its own.

The report is also available as a link at www.csus.edu/calst/Government_Affairs/faculty_fellows_reports.html. The Center for California Studies is at (916) 278-6906.

Media assistance is available by contacting Sacramento State Public Affairs at (916) 278-6156 or Greg deGiere, Senate Office of Research, at (916) 651-1820. Media planning to attend the briefing should RSVP to Ginny Dale at ginny.daley@sen.ca.gov.

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