2020 Census: How the Count Affects State Budgets
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1 2020 Census: Hw the Cunt Affects State Budgets Andrew Reamer, Research Prfessr Gerge Washingtn Institute f Public Plicy Gerge Washingtn University Natinal Assciatin f State Budget Officers Annual Cnference Oklahma City, Oklahma July 23, 2018 Hw the Census Affects State Budgets Cntext James Madisn s prpsal fr the 1790 Census lives n Census-derived datasets Direct impacts f Census n state budgets State budget frecasting State tax and expenditure limitatins (TELs) Federal financial assistance t states Indirect impacts f Census influence n business decisins, gvernment decisins, demcracy 1
2 Cntext: Rep. Madisn s Prpsal [Cngress] had nw an pprtunity f btaining the mst useful infrmatin fr thse wh shuld hereafter be called upn t legislate fr their cuntry if this bill [Census Act f 1790] was extended s as t embrace sme ther bjects besides the bare enumeratin f the inhabitants; it wuld enable them t adapt the public measures t the particular circumstances f the cmmunity. In rder t knw the varius interests f the United States, it was necessary that the descriptin f the several classes int which the cmmunity was divided, shuld be accurately knwn; n this knwledge the legislature might prceed t make a prper prvisin fr the agricultural, cmmercial and manufacturing interests, but withut it they culd never make their prvisins in due prprtin. Cntext: Rep. Madisn s Prpsal This kind f infrmatin all legislatures had wished fr; but [it] had never been btained in any cuntry. He wished, therefre, t avail himself f the present pprtunity f accmplishing s valuable a purpse. [I]n rder t accmmdate ur laws t the real situatin f ur cnstituents, we ught t be acquainted with that situatin. If the plan was pursued in taking every future census, it wuld give [Cngress] an pprtunity f marking the prgress f the sciety, and distinguishing the grwth f every interest. This wuld furnish grund fr many useful calculatins.... 2
3 Cntext: Census-derived Datasets Gegraphic Classificatins Urban/Rural Areas (Census Bureau) Cre-based Statistical Areas (OMB) Rural-Urban Cmmuting Areas (ERS) Cunty Typlgy Cdes (ERS) Fundatinal Ppulatin Estimates (Census Bureau) Husing Unit Estimates (Census Bureau) American Cmmunity Survey (Census Bureau) Current Ppulatin Survey and supplements (Census Bureau and Bureau f Labr Statistics [BLS]) Cnsumer Expenditure Survey (BLS) Cntext: Census-derived Datasets Ecnmic Indicatrs Cnsumer Price Index (BLS) Persnal Incme (BEA) Per Capita Incme (BEA) Pverty (Census) Lcal Area Unemplyment Statistics (BLS) Reginal Price Parities (BEA) Financial Assistance Prgram-specific Eligibility criteria Median Family Incme (HUD) Index f Medical Underservice (HHS) Allcatin frmulas Small Area Incme and Pverty Estimates (Census fr Department f Educatin) Fair Market Rent (HUD) 3
4 Decennial Rle in Census-derived Data Direct e.g., Urban/Rural designatins, Ppulatin Estimates Husehld survey design/analysis e.g., ACS, CPS Sampling frame Sample design Imputatin Weighting Variance Applicatin f husehld survey data e.g., CPI, Ppulatin Estimates Ppulatin denminatr per capita incme Budget Frecasting All states but VT required t balance budget All states + DC prepare revenue and expenditure frecasts, ften multi-year GFOA recmmends frecasting majr revenues and expenditures several years int future Reliable budget frecasting begins with analysis f a series f Census-derived measures: Ppulatin Persnal incme Inflatin Grss dmestic prduct 4
5 TELs In 2015, 28 state gvernments were limited in ability t raise state gvernment spending (23 states), taxes (three states), r bth (tw states) In all but Illinis, limit determined n basis f change in ne r mre Census-derived indicatrs Ppulatin Persnal incme Per capita incme Inflatin Prjected revenue In FY2016, states received abut $620 billin frm the federal gvernment (state budgets = $2.136B) Of this amunt, $493 billin came frm 17 Censusguided prgrams, the largest being: Medicaid ($361 billin) Highway Planning and Cnstructin ($40 billin) TANF ($17 billin) CHIP ($14 billin) Special Educatin ($12 billin) WIC ($6 billin) Fster Care ($5 billin) LIHEAP ($3 billin) Child and Adult Care Fd ($3 billin) Expect t find many mre small prgrams prviding grants t states 5
6 The accuracy f each state gvernment s 2020 Census cunt will affect its allcatin f federal $ Imprtance f Ppulatin Estimates in calculating Per Capita Incme (PCI) determines each state s Federal Medical Assistance Percentage (FMAP) FMAP used t determine state $ flw cncerning: Traditinal Medicaid (reimbursement) Medicare Part D clawback fr dual eligibles (payment) CHIP (reimbursement) Title IV-E Fster Care (reimbursement) Title IV-E Adptin Assistance (reimbursement) Child Care and Develpment Fund (state match) 6 FMAP prgrams = $286.1 billin in FY2015 FMAP frmula FMAP state = 1 - ((Per capita incme state ) 2 / (Per capita incme U.S.)2 * 0.45) Cmpnents f PCI PCI = State Persnal Incme/Ppulatin Estimate SPI and PE independently calculated PE highly sensitive t decennial cunt Ppulatin Estimate = 2020 cunt plus annual cmpnents f ppulatin change Births Deaths Dmestic migratin Internatinal migratin (frm ACS) 6
7 FMAP minimum = 50 (DC set at 70) 13 states at minimum in FY15 14 states in FY19 Fr states nt at minimum, an undercunt increases PCI relative t US and lwers FMAP FY15 $ lss in FMAP-guided prgrams per persn missed in 2010 Census Median TN ($1,091) Max VT ($2,309) Min UT ($533) Fr state with FMAP > 50, additinal 1% undercunt in 2010 decreases FMAP by pints. FY15 examples: TX > AL >
8 Est. FY15 cst fr 27 states, rank rder: State Millins State Millins State Millins TX $291.9 TN $69.2 IA $38.6 PA $221.8 GA $68.6 SC $37.4 FL $177.8 CO $63.5 AL $36.1 OH $139.1 LA $62.2 MS $30.1 IL $122.2 IN $60.2 KS $29.1 MI $94.3 AZ $56.7 AK $26.5 NC $94.2 OR $44.8 NM $23.1 MO $76.2 KY $42.2 ME $21.8 WI $76.1 OK $42.1 NE $20.3 Census impact n FMAP prgrams ttal ppulatin cunt Census impact n nn-fmap prgrams depends n wh is undercunted Highways state grant frmula variables include ttal ppulatin, urban ppulatin, and median incme Special Educatin grants t states based in part n each state s share f children and children in pverty WIC -- A state s fair share target funding fr fd is its share f infants and children (ages 0-4) at r under 185 percent f pverty Ubiquitus impact f American Cmmunity Survey Madisn s legacy 8
9 Indirect Impacts f Decennial Census n State Budgets Ecnmy business decisins Site lcatin Size f establishment Gds and services ffered Marketing Public Plicy and Prgrams gvernment decisins Plicy and prgram design, e.g., Census Transprtatin Planning Package Amunt f federal and state funds apprpriated Allcatin f federal funds t husehlds, e.g., SNAP, Sectin 8 State aid t lcal areas Prgram evaluatin Demcracy Apprtinment and redistricting 2020 Census: Hw the Cunt Affects State Budgets Andrew Reamer, Research Prfessr Gerge Washingtn Institute f Public Plicy Gerge Washingtn University areamer@gwu.edu (202)
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