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U.S. Department of Housing and Urban Development

PDR-00-01
Special Attention of:
Secretary's Representatives, Community Builders, Economists, Public @amp; Indian Housing Division Directors, Multifamily Hub and Program Center Directors

Issued: March 9, 2000
Expires: Effective until superseded

Cross References:

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Subject: Estimated Median Family Incomes for Fiscal Year 2000

This memorandum transmits median family income (MFI) and income distribution estimates for Fiscal Year 2000 (FY 2000). They are calculated for each metropolitan and nonmetropolitan area using the Fair Market Rent (FMR) area definitions applied in the Section 8 Housing Choice Voucher Program. The estimated median family income for the United States for FY 2000 is $50,200.

The FY 2000 MFI estimates are based on 1990 Census median family income estimates updated to 2000 using a combination of Bureau of Labor Statistics earnings and employment data and Census Divisional P-60 median family income data. Attachment 1 provides an explanation of the methodology used to develop these estimates. Attachment 2 provides median income estimates for States. Attachment 3 provides metropolitan area and nonmetropolitan county estimates of median family incomes. Attachment 4 provides the area definitions used for income limits.

Please note that the use of the HUD median family income estimates and income limits is subject to individual program guidelines covering definitions of income and family, family size, effective dates, and other factors. If you have any questions concerning these matters, please refer them to your Office's economist. Public inquiries may be referred to the HUD USER reference service, whose toll-free number is 1-800-245-2691.

HUD median family income estimates are also available at the Department's World Wide Web site, which provides a menu from which you may select the year and type of data of interest (https://www.huduser.gov/datasets/il.html)

Susan M. Wachter
Assistant Secretary for Policy Development and Research

Previous Editions are Obsolete
Distribution: W-3-1
HUD 21B (3-80)
GPO 871 902

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Attachments

Attachment 1

HUD METHODOLOGY FOR ESTIMATING FY 2000
MEDIAN FAMILY INCOMES
(ECONOMIC AND MARKET ANALYSIS DIVISION,
OFFICE OF ECONOMIC AFFAIRS, PD&R)

FY 2000 HUD estimates of median family income are based on 1990 Census data estimates updated with a combination of local Bureau of Labor Statistics data and Census Divisional data. Separate median family income estimates (MFIs) are calculated for all Metropolitan Statistical Areas (MSAs), Primary Metropolitan Statistical Areas (PMSAs), and nonmetropolitan counties.

The income adjustment factors used to update the 1990 Census-based estimates of MFIs are developed in several steps. Average wage data from the Bureau of Labor Statistics (BLS) were available for 1989 through the end of 1997 at a county level, and were aggregated to the metropolitan area level for multi-county metropolitan areas. Census Divisional level median family and household income estimates were available from the Current Population Report (CPS) March 1990-99 surveys, which measure incomes from mid-1989 through mid-1998. These data were then used to update mid-1989 income estimates from the 1990 Census to the middle of 1998. The mid-1998 estimates were trended forward to mid-FY 2000 using a factor based on past P-60 Series trends. The step-by-step normal procedures as well as the exception procedures used are as follows:

1. Estimate mid-1989 local median family incomes using 1990 Census data. (Current HUD Section 8 Fair Market Rent (FMR) program definitions are used to define metropolitan areas, which are normally the same as Office of Management and Budget metropolitan area definitions.)

2. Calculate the BLS wage change factors for each Census Division for the 1989-97 period as follows:

Census Division BLS Wages (1997) Census Division BLS Employees (1997) Census Division BLS Wages (1989) Census Division BLS Employees (1989)

=

8-year BLS wage increase factor for Census Division

3. Calculate the change in median family and household incomes for the nine Census Divisions for the 1989-1998 period using Census P-60 series data, as follows:

Census Division P-60 MFI (1998) Census Division P-60 MFI (1989)

=

9-year increase factor for Census Division P-60 Median Family Income

4. Compare the BLS and P-60 series Census Divisional factors calculated in steps 2 and 3 to provide a means of adjusting local BLS wage factor changes so that they aggregate to the same change factor as P-60 changes in family incomes plus contain an added year of CPS trending.

9-year increase factor for Census Division P-60 MFI 8-year increase factor for Census Division BLS Wages

=

Ratio of Census Division P-60 MFI to ratio of Census Division BLS wage changes

5. Calculate the 1989-98 increase factors for the individual metropolitan areas and nonmetropolitan counties by applying the Census Divisional index factors from step 4 to local BLS data.

Local BLS Wages (1997) Local BLS Employees (1997) Local BLS Wages (1989) Local BLS Employees (1989)	*	Ratio of Census Division P-60 MFI to Census Division BLS wages	=	9-year income adjustment factor for MSA or County
			=	1989 to mid- 1998 MFI adj. factor

6. Convert 1989-98 step 5 change factor to a 1989-2000 change factor by applying an annual trending figure of 4.0 percent to update the mid-1998 estimate to mid-1999, and applying a 3.0 percent factor (3/4ths of 4.0 percent) to the mid-1999 to April 1, 2000 period. (Use of a trending factor is necessary because of lags in Bureau of Labor Statistics and P-60 Series data availability; the 4.0 percent factor is based on national income change patterns in recent years.)

(Step 5 adj. factor) * 1.04 * 1.03 = 1989 to mid-FY 2000 adjustment factor)

7. Calculate median family incomes for FY 2000 by multiplying the step 1 Census estimate of median family income by the income adjustment factor derived in Step 6.

1990 Census Median Family Income * Step 6 factor = FY 2000 MFI est.

8. For American Housing Survey areas, compare the MFI estimates from step 7 with median family income estimates based on post-1989 American Housing Survey (AHS) estimates of median family income updated to 2000. Past analysis shows that there is 95 percent likelihood that the true local median family income is within 6 percent of the AHS-based estimate. For areas where an AHS-based estimate differs by more than 6 percent from the Census-based estimate, local MFI estimates are increased or decreased so that they are within 6 percent of the AHS-based estimate.

9. Compare the 2000 MFI estimate with the 1999 MFI estimate. If the 1999 estimate is higher, set the 2000 estimate at the 1999 level. (This policy is applied except when estimates are revised with decennial Census data, and serves to minimize disruption in program activities due to temporary decreases in income estimates.)

In addition to the above procedures, constraints are placed on annual changes in the Census Divisional and BLS change factors based on past experience. These guidelines constrain increases for a small number of areas with unusually high increases.

Attachment 2

FY 2000 MEDIAN FAMILY INCOMES FOR STATES,
METROPOLITAN AND NONMETROPOLITAN PORTIONS OF STATES

 --------FY 2000---------- ---------1989---------- TOTAL METRO NONMETRO TOTAL METRO NONMETRO ALABAMA 44300 47900 37100 28688 31005 24084 ALASKA 53900 59200 50100 46580 50109 44045 ARIZONA 47800 50000 32900 32177 33536 23997 ARKANSAS 37600 43600 32500 25395 29425 22208 CALIFORNIA 55400 56100 37000 40558 40969 29946 COLORADO 54900 57700 42300 35929 37461 28257 CONNECTICUT 66000 67200 55200 49198 49512 43591 DELAWARE 61400 65100 44600 40251 42237 31112 DIST. OF COLUMBIA 58500 58500 0 36255 36255 0 FLORIDA 47300 48200 37100 32211 32761 25874 GEORGIA 50600 57100 38700 33529 37551 26690 HAWAII 57700 60800 50900 43176 45313 37990 IDAHO 43700 49600 39600 29472 32220 27799 ILLINOIS 60300 64200 43600 38663 40964 29693 INDIANA 51500 54000 46000 34082 35664 30800 IOWA 49100 55100 45300 31658 35618 29303 KANSAS 50100 59100 41100 32965 38356 28067 KENTUCKY 42200 51200 34600 27028 32411 22542 LOUISIANA 38100 41000 30500 26313 28246 21177 MAINE 39800 45200 37600 32421 36629 30719 MARYLAND 66900 68400 50500 45033 45988 33695 MASSACHUSETTS 58600 59300 48000 44366 44728 37765 MICHIGAN 55400 59300 41500 36651 39033 27893 MINNESOTA 57900 65600 44300 36915 41398 28933 MISSISSIPPI 38100 45400 34400 24447 29496 21994 MISSOURI 48600 55600 37400 31837 36252 24324 MONTANA 39900 43900 37800 28042 30207 26977 NEBRASKA 50400 59300 42600 31634 36639 27623 NEVADA 53600 53600 53500 35837 35891 35577 NEW HAMPSHIRE 53600 58600 46800 41628 45429 36623 NEW JERSEY 66600 66600 0 47589 47589 0 NEW MEXICO 40800 47600 32600 27623 31550 23165 NEW YORK 56100 57600 40300 39740 40635 31472 NORTH CAROLINA 48000 52200 40100 31548 34083 27206 NORTH DAKOTA 43000 49100 38900 28707 32677 26194 OHIO 51900 53700 45300 34350 35392 30562 OKLAHOMA 39300 43600 33300 28553 31805 24139 OREGON 46000 50000 37500 32336 34637 27616 PENNSYLVANIA 47100 48900 38200 34856 36147 28934 RHODE ISLAND 50200 50100 51900 39172 39078 40639 SOUTH CAROLINA 45000 46900 40300 30797 32349 26904 SOUTH DAKOTA 43500 50100 40600 27601 32338 25547 TENNESSEE 47600 51700 40200 29546 32092 24937 TEXAS 47600 50400 34700 31553 33231 24585 UTAH 49400 51900 41000 33245 34322 30183 VERMONT 43000 52200 40000 34779 41968 32453 VIRGINIA 56900 63000 39800 38208 42000 28301 WASHINGTON 53400 56600 38600 36794 38495 29671 WEST VIRGINIA 35100 41500 30600 25602 29882 22654 WISCONSIN 54300 58400 46700 35081 37659 30290 WYOMING 44700 44300 44900 32215 32529 32096 UNITED STATES 50200 53900 37400 35224 37617 27255  

NOTE: DEFINITIONS OF METROPOLITAN AREAS ARE CURRENT AS OF OCTOBER 1999

Fiscal Year 2000 Income Limits