Poverty in Maine - 2003

Introduction

This report presents a county-by-county picture of poverty in Maine. The Maine Community Action Association contracted with the Margaret Chase Smith Center for Public Policy at the University of Maine to design and conduct a statewide needs assessment as part of the Community Services Block Grant requirements. The intent is to build upon the Maine State Planning Office "Annual Report Card on Poverty in Maine," which looks at indicators statewide, in order to provide a more detailed examination of poverty at the county and local levels. This written report represents a small subset of the data compiled for this project. We also have produced a database with a good deal of additional information at the municipal level, which will be provided to the Community Action Agencies for their use in future needs assessment, planning and evaluation activities.

Methodology and Data Sources

We have prepared this picture of poverty in Maine by using a few sets of data selected for their measurement properties of accuracy, completeness and longitudinal availability, rather than using a larger variety of less thorough datasets. The datasets selected for analysis are from the food stamp and Temporary Assistance to Needy Families (TANF) programs administered by the Department of Human Services, the Low Income Home Energy Assistance Program (LIHEAP) administered by the Maine State Housing Authority (MSHA) through the Community Action Agencies, unemployment data from the Maine Department of Labor, and relevant information from Census 2000. Most of the Census information used here is from the "Long Form" files (dataset SF3), compiled from a sample of those who completed the Census forms.

The datasets used in this report are from slightly different time periods. Most Census information is from the date of the decennial Census (April 2000), but income, poverty level, and work history information in the Census is derived from questions regarding the preceding calendar year (1999). Information about the TANF/food stamp and LIHEAP programs is from the most recent federal fiscal year (October 2001- September 2002). Unemployment rates are an average for January-December, 2002. In this report, discussion of decennial Census information is generally in the present tense, since the Census represents a point in time "snapshot" of population and housing. Information in the other databases is collected and updated at regular time intervals, and is discussed here in the past tense for that reason.

Information that is gathered in program implementation is rarely perfectly suited for outcome measurement or for needs assessment. As policy researchers, we almost always work with information that was collected for a different purpose than the task at hand. In social service programs, such as the food stamp, TANF and LIHEAP programs, information is usually collected to establish individual eligibility, avert fraud, facilitate third-party billing, and count services rendered. Our intent in this project is to use the information not just to document what has been done, but to help estimate what has not been done. To gauge unmet need, participation rates for various benefit and assistance programs can be measured against each other and against other poverty measures from the Census.

In this effort, we have worked interactively with the Community Action Agency directors in order to select, analyze, and portray those poverty indicators that are most useful and relevant to the mission of the CAA programs and the needs of Maine's population. The indicators used here are a subset of standard ones used in the United States in evaluating the extent of poverty and assessing needs. These include income, poverty rate, population demographics, housing, transportation access, employment, and measures of services and benefits aimed at low-income populations.

Report Organization

This report is divided into two sections. First is a description of poverty indicators, along with an overall statewide view of a subset of these indicators. These are presented in a series of maps and charts with accompanying text. The maps and charts allow for county-by-county comparisons of the selected indicators, as well as comparison of the county-level information with that for the state as a whole. The second section provides "poverty profiles" of each county. Each profile includes: a series of tables of poverty indicators, a brief narrative analysis of highlights of those indicators, a map down to the town level for one selected indicator (households in each town receiving LIHEAP assistance in 2001-2002), and a chart of three key indicators for the county compared with statewide totals (households below poverty level, households receiving LIHEAP, households receiving TANF and/or food stamps).

The indicators of poverty used in both sections of this report are divided into four broad areas: People (household types, age distribution, education), Income and Employment (per-capita and household income, household poverty status and employment, unemployment rate), Housing and Transportation (housing costs relative to household income, household access to vehicle), and Benefits and Assistance (TANF/food stamp clients and cases, LIHEAP recipients, households, household characteristics).

Defining Poverty, Poverty Thresholds, and Poverty Guidelines

Poverty is a complex, multidimensional concept. It can be conceived as absolute or relative. Measures can be based on lack of income or on failure to attain capabilities. Poverty can be chronic or temporary. It is sometimes closely associated with inequity, and is often correlated with social exclusion. Broad definitions of poverty might include components such as: household income/consumption (e.g., poverty "lines" or thresholds); human capabilities (e.g., education, child nutrition, low birth-weight babies); access to public services (e.g., schools, transportation, health services, safe water and sanitation facilities); employment and assets (e.g., employment rates, housing). Using non-income measures of poverty can provide a more complete assessment of poverty in its different dimensions, but it complicates analysis since certain groups that would be considered "poor" by some indicators would not be by others.¹

In the United States, the most widely-known and commonly-used poverty indicator is the federal poverty measure.² This income-based measure was officially established in 1969 by the Office of Management and Budget, based on work done during the 1950s by Mollie Orshansky, an analyst with the Social Security Administration. Gross cash income for the household is compared with the appropriate threshold and adjusted for family size, to determine poverty status. There are two slightly different versions of the federal poverty measure: the poverty thresholds, and the poverty guidelines. Both of these are updated annually for price changes using the Consumer Price Index for All Urban Consumers (CPI-U).

• Poverty thresholds: This is the statistical version of the poverty measure, and is issued by the Census Bureau. It is used in calculating the number of persons and households in poverty in the United States or in states and regions. The Census poverty threshold uses separate figures for aged and non-aged, one-person and two-person households. In this report, when we refer to households or individuals as being below or above poverty, we are using the Census poverty thresholds.
    
• Poverty guidelines: This is the administrative version of the poverty measure, and is issued by the Department of Health and Human Services (HHS). The poverty guidelines are a simplification of the poverty thresholds, and are used in determining financial eligibility for many federally-funded programs. The poverty guidelines do not make a distinction between elderly and non-elderly households as do the Census poverty thresholds. Some programs use a percentage multiple of the guidelines in determining eligibility, such as 125%, 150%, or 185%. A major reason for having poverty guidelines distinct from thresholds is that thresholds for a given year are not published in final form until late summer of the following calendar year. Poverty guidelines are sometimes loosely referred to as the "federal poverty level."

Some examples of federal programs that use poverty guidelines in determining eligibility are:

• In HHS: Community Services Block Grant, Head Start, Low Income Home Energy Assistance Program (LIHEAP), Children's Health Insurance Program
• In the Department of Agriculture: Food Stamps, Special Supplemental Nutrition Program for Women, Infants, and Children (WIC), the National School Lunch and School Breakfast programs
• In the Department of Energy: Weatherization Assistance
• In the Department of Labor: Job Corps, Senior Community Service Employment Program, National Farmworker Jobs Program
• In the Legal Services Corporation: Legal services for the poor

Some relatively recent provisions of Medicaid use the poverty guidelines, but the rest of that program (accounting for roughly three-quarters of Medicaid eligibility determinations) does not. A number of the major means-tested programs do not use the poverty guidelines in determining eligibility, including Temporary Assistance for Needy Families (TANF) (and its predecessor, Aid to Families with Dependent Children, AFDC), Supplemental Security Income (SSI), the Earned Income Tax Credit (EIC) program, the Department of Housing and Urban Development's means-tested housing assistance programs, and the Social Services Block Grant. Some state and local governments have chosen to use the federal poverty guidelines in some of their own programs and activities, as have some private companies in determining eligibility for their services to low-income people.

A number of the Census indicators in this report examine differences between households or individuals below and above the poverty threshold. Information on poverty in the Census is derived from a sample of the population, with figures projected for the general population. Poverty status at the household level is determined based overall household income reported by respondents (from all cash sources, including wages, self-employment, "social welfare" cash benefits, interest and dividends, pensions, etc.), adjusted for household size and age. Poverty on the individual level is defined as any individual living in a household that is below poverty.

The federal poverty measure has come under a good deal of criticism, and there are ongoing efforts to modify the way the measure is calculated to make it more relevant and meaningful. Changes in federal policy, regional differences, and changing levels or patterns of consumption by American households have not been incorporated into the federal poverty measure. In terms of policy, changes in the tax code (e.g., increased payroll and income taxes) have changed the amount of available income for households; in-kind benefits (e.g., food stamps, housing assistance) are not included in calculations of household resources. Regional variations in the cost of living, especially housing costs, are not considered when determining a household's consumption needs. Costs of childcare, medical care, and health insurance are ignored.

Several important studies and reports have suggested ways in which the federal poverty measure can be revised. The Bureau of the Census has issued a series of reports on experimental measures of poverty, so progress toward modifying the federal poverty measure is being made. However, for now, program planning and evaluation and policy studies will continue to rely on the existing federal poverty thresholds and guidelines.³

Endnotes

1. Renata Lok-Dessallien, "Review of Poverty Concepts and Indicators" and "Poverty Profiles: Interpreting the Data." United Nations Development Program, Social Development and Poverty Elimination Division (SEPED). (n.d.) http://www.undp.org/poverty/publications/pov_red/
     
2. Information here on the federal poverty threshold and on programs using and not using the federal poverty guidelines is from the excellent University of Wisconsin Institute for Research on Poverty website, in the "Frequently Asked Questions" section (http://www.ssc.wisc.edu/irp/faqs). The U.S. Department of Health and Human Services definitions and annual updates of poverty guidelines may be found at: http://aspe.hhs.gov/poverty
     
3. A useful summary of a 1999 conference evaluating the federal poverty measure may be found in a paper by Thomas Corbett, "Poverty: Improving the Measure After Thirty Years: A Conference," which is available on the University of Wisconsin Institute for Research on Poverty website. http://www.ssc.wisc.edu/irp/povmeas/corbetttxt.htm Links to the Census Bureau's reports on experimental poverty measures may be found at: http://www.census.gov/hhes/poverty/povmeas/reports.html