Federal Formula Programs:

Outdated Population Data Used to Allocate Most Funds

HRD-90-145: Published: Sep 27, 1990. Publicly Released: Oct 29, 1990.

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Pursuant to a congressional request, GAO identified federal formula programs that used outdated population data to distribute funds to state and local governments, focusing on: (1) formula programs that used Census Bureau population data to distribute funds; (2) what population data and data sources federal agencies used and were required to use to distribute funds; and (3) whether the Census Bureau provided or could provide more current population data from the decennial census.

GAO found that: (1) in fiscal year 1989, 93 federal formula programs used Census Bureau population data to determine eligibility for or distribute $27.5 billion in funds to state and local governments; (2) of those 93 programs, 48 programs used current population estimates to distribute $10.1 billion, and 45 programs used 1980 decennial census population data to distribute $17.4 billion; (3) 33 programs used the most currently available decennial population data to distribute $16.7 billion, primarily involving urban and rural area populations and populations below the poverty level; (4) 12 programs used state population data from the decennial census to distribute $641.6 million, even though the Census Bureau had more current state population data; (5) the Census Bureau believed that it could develop and provide intercensal poverty data by using statistical modelling procedures, but could not provide intercensal data on urban and rural area populations; and (6) proposed legislation would require agencies to use the most recent population data for distributing federal formula funds, but this legislation would only affect six programs, since the remaining programs already used the latest available data or were required by statute to use the decennial census.

Matter for Congressional Consideration

  1. Status: Closed - Not Implemented

    Comments: During the 103rd Congress, Senator Mack introduced five bills (S. 300, and S. 302 through S. 305) that would have amended authorizing grant program allocations to delete references to the decennial census and replace them with reference to most currently available estimates; and he introduced S. 306 that would require Census to produce annual estimates. No action was taken and no bills are expected to be introduced in the 104th Congress.

    Matter: In its deliberations on how best to distribute federal funds to the states, Congress may wish to consider directing: (1) affected program agencies to study the effects of using incorporated or metropolitan area data rather than urban data to allocate formula funds; and (2) the Census Bureau to study the feasibility of estimating the low-income population data on a more current basis. Depending on the outcome of those efforts, Congress could then consider whether it should amend authorizing statutes to remove requirements that federal agencies use urban and rural population or low-income data from the decennial census to allocate funds and instead require that the funds be distributed using some other basis and data.


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