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 (http://www.huduser.org/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

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.

                    --------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