AJR 40, as amended, Mullin. Federal poverty level measurement.
This measure would urge the federal government to take steps to reform the outdated and inadequate Official Poverty Measure to better reflect poverty and the unmet needs demonstrated by the Supplemental Poverty Measure.
Fiscal committee: no.
P1 1WHEREAS, The Official Poverty Measure is determined by
2the United States Census Bureau and is instrumental in determining
P1 1an individual’s eligibility for a number of government programs,
2including the Supplemental Nutrition Assistance Program;
3Medicaid; School Lunch Program; Women, Infants, and Children;
4Housing Assistance; and others; and
5WHEREAS, The method we use today was developed in the
61964 by Mollie Orshanksy of the Social Security Administration,
7and that method used before-tax cash income to determine a
8family’s resources, which was then compared to a poverty
9threshold; and
10WHEREAS, In determining this poverty threshold, Orshanksy
11used a food plan developed by the federal Department of
12Agriculture that was designed for “temporary or emergency use
13when funds are low,” and then multiplied the cost of the plan by
14three because, at the time, a family typically used about a third of
15their income on food; and
16WHEREAS, Other than minor changes, the method has remained
17the same over time, despite significant economic and governmental
18changes, including the introduction of Medicare and Medicaid,
19the shift from a manufacturing to a service economy, welfare
20reform of the 1990’s, and the general stagnation of wages; and
21WHEREAS, The Official Poverty Measure is a one-size-fits-all
22policy that leads to a distorted perception of poverty and an
23inefficient allocation of resources to fight poverty; and
24WHEREAS, The Official Poverty Measure has failed to
25accurately measure poverty because it has not kept up with the
26changes to our economy and social science research; and
27WHEREAS, The Official Poverty Measure does not take into
28account that families no longer spend one-third of their income on
29food; they currently spend between 5 to 10 percent; and
30WHEREAS, The Official Poverty Measure does not account
31for noncash transfers, such as the Supplemental Nutrition
32Assistance Program or Medicaid, as income; and
33WHEREAS, The Official Poverty Measure does not account
34for variations in cost-of-living in different regions of our country;
35and
36WHEREAS, Low-income working families in California are
37especially disadvantaged by the Official Poverty Measure due to
38our state’s high cost of living, which results in the denial of
39federally funded assistance to families living above the federal
40poverty line, but who are unable to meet their basic needs; and
P3 1WHEREAS, The Official Poverty Measure does not account
2for the increase in child care expenses due to the rise in the
3workforce participation of both parents; and
4WHEREAS, The Official Poverty Measure does not account
5for variations in health care coverage and out-of-pocket medical
6costs; and
7WHEREAS, Historically, there has been widespread agreement
8among analysts, advocates, and policymakers that the Official
9Poverty Measure is inadequate, leading to a 1990 Congressional
10appropriation that was made for an independent scientific study
11on a new calculation method; and
12WHEREAS, This study was performed by The National
13Academy of Sciences, which established the Panel on Poverty and
14Family Assistance. The panel released a report in 1995 entitled
15“Measuring Poverty: A New Approach,” which established
16guidelines for creating a new method; and
17WHEREAS, Fifteen years later, in 2010, the Interagency
18Technical Working Group on Developing a Supplemental Poverty
19Measure and the Census Bureau and the Bureau of Labor developed
20an alternative poverty measure known as the Supplemental Poverty
21Measure; and
22WHEREAS, The Supplemental Poverty Measure was designed
23to take into account changes in the United States economy over
24time, cost-of-living variations in different parts of the country, and
25the changing role of government; and
26WHEREAS, The Supplemental Poverty Measure more
27accurately measures poverty by using a basic set of goods that
28includes food, clothing, shelter, and utilities, adjusted to reflect
29the needs of different family types and to account for geographic
30differences in living costs to establish what is known as a poverty
31threshold; and
32WHEREAS, The Supplemental Poverty Measure defines family
33resources as the value of cash income from all sources, plus the
34value of noncash benefits, including nutrition assistance, subsidized
35housing, home energy assistance, tax credits, and other benefits
36that are available to buy the basic bundle of goods, minus the
37necessary expenses for critical goods and services not included in
38the thresholds; and
39WHEREAS, Necessary expenses include income taxes, Social
40Security payroll taxes, childcare and other work related expenses,
P4 1child support payments, and contributions toward the cost of
2medical care and health insurance premiums or out-of-pocket
3medical costs; and
4WHEREAS, The Supplemental Poverty Measure offers a more
5accurate measure of poverty than the general Official Poverty
6Measure; and
7WHEREAS, The use of the Official Poverty Measure can have
8a detrimental effect on policies to combat poverty because it results
9in less efficient and less accurately targeted policies and
10expenditures; and
11WHEREAS, It is vital that we implement a fair poverty measure
12that allows us to efficiently allocate resources and focus on regions
13and populations that need help the most; and
14WHEREAS, Given the numerous inadequacies of the Official
15Poverty Measure as a tool to accurately target and efficiently
16allocate antipoverty resources, the Supplemental Poverty Measure
17should supplant the Official Poverty Measure for administrative
18purposes in determining financial eligibility for programs intended
19to reduce poverty; now, therefore, be it
20Resolved by the Assembly and the Senate of the State of
21California, jointly, That the Legislature of California urges the
22President and the Congress of the United States to take steps to
23reform the outdated and inadequate Official Poverty Measure to
24better reflect poverty and the unmet needs demonstrated by the
25Supplemental Poverty Measure; and be it further
26Resolved, That the Chief Clerk of the Assembly transmit copies
27of this resolution to the President and the Vice President of the
28United States, to the Speaker of the House of Representatives, to
29the Majority Leader of the Senate, and to each Senator and
30Representative from California in the Congress of the United
31States, to the Governor of California, and to the author of this
32resolution.
O
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