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June 25, 2019

ATTORNEY GENERAL RAOUL OPPOSES CHANGES TO CALCULATION OF FEDERAL POVERTY THRESHOLD

Raoul & 20 Attorneys General Argue Changes Could Deprive Millions of Critical Aid

Chicago — Illinois Attorney General Kwame Raoul and New York Attorney General Letitia James led a multistate coalition of 21 attorneys general in submitting a comment letter to the federal Office of Management and Budget (OMB), opposing a proposal to change the way the federal poverty threshold is calculated. According to the attorneys general, an adjustment could result in millions of Americans becoming ineligible for, or entitled to less government-funded benefits.

A wide range of federal and state programs, including those that provide food stamps and health care assistance, rely on federal poverty guidelines to set eligibility standards. The guidelines are derived from the official poverty thresholds produced by the U.S. Census Bureau. In their comments, Raoul and the attorneys general argue that OMB’s proposal to alter the way the poverty thresholds are updated over time could result in denying millions of people the assistance they deserve.

“Federal poverty guidelines help states provide vital services to families in need,” Raoul said. “This arbitrary change will have the worst impact on low-income residents and will succeed only in continuing to trap them in a cycle of poverty.”

On May 7, the OMB announced that it would consider lowering the measure of inflation that is used when adjusting the federal poverty threshold. According to Raoul and the attorneys general, while the current formula is outdated and does not accurately reflect the spending patterns of people living close to the poverty threshold, a change the OMB is considering could only worsen flaws in the existing methodology. Additionally, Raoul and the attorneys general argue that OMB has not provided any evidence or reasoning to support lowering the measure of inflation.

For the purposes of calculating the federal poverty threshold, OMB defines inflation as a rise in the general level of prices and represents a decline in the purchasing power of money. In the comments, Raoul and the attorneys general highlight research that shows low-income populations experience inflation at rates higher than other populations, and argue that lowering the measure of inflation will lower the poverty threshold and reduce the number of people who are deemed to be living in poverty and who are therefore eligible for federal benefits.

Joining Raoul and James in submitting the comments were the attorneys general of California, Connecticut, Delaware, the District of Columbia, Hawaii, Kentucky, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, North Carolina, Oregon, Rhode Island, Vermont, Virginia, and Washington.

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