The 10-20-30 Rule and Persistent Poverty Counties (CRS Report for Congress)
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| Release Date |
Jan. 27, 2017 |
| Report Number |
R44748 |
| Report Type |
Report |
| Authors |
Joseph Dalaker |
| Source Agency |
Congressional Research Service |
Summary:
Anti-poverty interventions that provide resources to local communities, based on the
characteristics of those communities, have been of interest to Congress. One such policy, dubbed
the “10-20-30 rule,” was implemented in the American Recovery and Reinvestment Act of 2009
(ARRA, P.L. 111-5). Title I, Section 105 of ARRA required the Secretary of Agriculture to
allocate at least 10% of funds from three rural development program accounts to persistent
poverty counties; that is, to counties that have had poverty rates of 20% or more for the past 30
years, as measured by the 1980, 1990, and 2000 decennial censuses. One notable characteristic of
this rule is that it did not increase spending for the rural development programs addressed in
ARRA, but rather targeted existing funds differently.
Research has suggested that areas for which the poverty rate (the percentage of the population
that is below poverty) reaches 20% experience systemic problems that are more acute than in
lower-poverty areas. Therefore, policy interventions at the community level (such as applying the
10-20-30 rule to other programs besides those cited in ARRA), and not only at the individual or
family level, could continue to be of interest to Congress.
Poverty rates are computed using data from household surveys. Currently, the only data sources
that provide poverty estimates for all U.S. counties are the American Community Survey (ACS)
and the Small Area Income and Poverty Estimates program (SAIPE); before the mid-1990s, the
decennial census was the only source of county poverty estimates. Therefore, to determine
whether an area is “persistently” poor in a time span that ends after the year 2000, it must first be
decided whether ACS or SAIPE poverty estimates will be used for the later part of that time span.
Lists of persistent poverty counties may differ by roughly 80 to 100 counties in a particular year,
depending on the data source selected to compile the list and the rounding method used for the
poverty rate estimates. When determining the method to be used to compile a list of persistent
poverty counties, the following may be relevant to consider:
Characteristics of interest: SAIPE is suited for poverty or median income alone;
ACS for other topics in addition to poverty and income.
Geographic areas of interest: SAIPE is recommended for counties and school
districts only; ACS produces estimates for other small geographic areas as well.
Reference period of estimate: SAIPE for one year; ACS for a five-year span.
Rounding method for poverty rates: rounding to 20.0% (one decimal place)
yields a shorter list than rounding to 20% (whole number).
Poverty status is not defined for all persons: foster children (unrelated individuals
under age 15), institutionalized persons, and residents of college dormitories are
excluded; the homeless are not targeted by household surveys; and areas with
large numbers of students living off-campus may have high poverty rates.
