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California’s poverty rate boosted by housing cost

FRESNO (AP) – California has one of the highest poverty rates in the nation after the cost of living is taken into account, according to a survey released Thursday by the Public Policy Institute of California.

The official measure, which looks at income and the number of people in a family, says the state has the 15th highest poverty rate in the country, with 13.3 percent of its residents below the federal threshold.

But when housing costs are included, California shoots to third highest, with 16.1 percent of its residents in poverty, behind only Washington, D.C. and New York, said Deborah Reed, author of “Poverty in California: Moving Beyond the Federal Measure.”



“Making these adjustments gives us a better sense of how many people here are poor, who they are, where they live,” she said.

Reed took data collected by the U.S. Census Bureau, adjusted it for the number of people in a family, then adjusted it again for local fair market rent, according to a formula recommended in a 1995 National Academy of Sciences study.



Failing to consider regional differences can leave needy families unable to access help because the federal poverty line is used to determine who is eligible for aid programs such as food stamps, State Children’s Health Insurance, and Head Start.

Ideally, the official poverty measure would adjust not only for rent, but for other costs that vary greatly according to region, such as transportation, child care, or food, but this study is a first step in recognizing the real face of poverty in California, Reed said.

The difference is felt keenly by families struggling to get by on low or fixed incomes, particularly on the coast, where rents are notoriously high, according to social workers.

One in five residents of the counties with some of the state’s highest rents – Los Angeles, Monterey and San Francisco – live in poverty after the cost of housing is included, Reed found.

In San Francisco, the U.S. Department of Housing and Urban Development estimates rent for a two-bedroom apartment is about $1,775 a month, or $21,300 a year – higher than $19,157, the poverty line for a family of four.

The situation is similar in Los Angeles.

“The demand for housing far exceeds the supply,” said Anita Nelson, CEO of SRO Housing Corp., a nonprofit that refurbishes Skid Row buildings, turning decrepit hotels into safe, affordable homes. The organization has 1,700 filled housing units, and capped their waiting list at 300.

“The need is great, and this population is clearly being overlooked,” Nelson said.

The situation in some of the counties historically held as the poorest, such as Tulare and Kern in the rural San Joaquin Valley, improves a little after rent is taken into account.

In these agricultural areas, the low wages and seasonal jobs offered by farms keep the economy depressed. Although service providers say there is still a shortage of inexpensive housing and great need for food, clothing and other basic necessities, it’s a little easier for working families to get by because rents are cheaper.

Marcy Ramirez, who worked for Catholic Charities in Santa Barbara before transferring to Visalia, in Tulare County, said it was frustrating to see needy clients on the coast disqualified for help because their incomes were too high, even if most of the money was used for housing.

“You’d see people who were paying 75 percent of their income in rent, who had no money left over, so they were still in poverty, but they didn’t qualify for help,” she said.

Some of the long-held assumptions about poverty remain true under this new measure.

Poverty is highest among young children with one in five living in need. There are about twice as many Hispanics and blacks living in poverty, 20 percent, than whites, 9 percent.

The poorest families in the state are those in which adults lack a high school diploma at 41 percent. Next come families headed by single mothers, 37 percent, and foreign-born Hispanics, 27 percent.

On the Net:

Public Policy Institute of California: http://www.ppic.org


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