and a regular, automatic adjustment for real growth seems preferable to an adjustment that occurs spasmodically. However, the design of government assistance programs must take into account many factors, only one of which is a statistical standard of need. Other considerations, such as funding constraints and competing uses for scarce tax dollars, may dictate that assistance program benefits be set at a level below the statistical poverty thresholds.

RECOMMENDATION 7.1. Agencies responsible for federal assistance programs that use the poverty guidelines derived from the official poverty thresholds (or a multiple) to determine eligibility for benefits and services should consider the use of the panel's proposed measure. In their assessment, agencies should determine whether it may be necessary to modify the measure—for example, through a simpler definition of family resources or by linking eligibility less closely to the poverty thresholds because of possible budgetary constraints—to better serve program objectives.

GOVERNMENT ASSISTANCE PROGRAMS

Overview

In 1994, 70 federal and federal-state programs were providing cash, in-kind benefits, or other types of services to families or individuals who were deemed needy on the basis of an explicit income test.3Table 7-1 summarizes the number and expenditures of these programs in fiscal 1992 (see Burke, 1993, and Appendix D for details).

Of the 70 programs, 27 (39%) have as one of their income eligibility criteria that income be compared with the poverty guidelines or some multiple of them; see Table 7-2. They run the gamut from small programs that spend only a few million dollars a year (e.g., Follow Through and Senior Companions) to two of the largest assistance programs, food stamps and Medicaid. Of these programs, 14 use the poverty guidelines (or a multiple) as the sole criterion of income eligibility; they account for 2 percent of expenditures by all assistance programs. Examples are the Maternal and Child Health Services Block Grant, Legal Services, and Foster Grandparents. The other 13 programs, which account for 56 percent of expenditures by all assistance programs, have several ways of determining income eligibility. For example, School Lunch and School Breakfast accord eligibility to children whose families already participate in AFDC or food stamps, and they also permit other

3  

Assistance programs typically have other requirements for eligibility besides a comparison of income with a need standard: for example, they may provide benefits only to people in certain age categories or have a limit on assets in addition to income or have other restrictions or requirements. Our discussion focuses on programs' definitions of and limits on income.



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