Improving Federal Assistance to Families Act
The Improving Federal Assistance to Families Act would overhaul how the federal government measures poverty for program eligibility. It creates a new Regionally Adjusted Poverty Line (RAPL) that is published annually for each state. The RAPL is calculated by adjusting each state’s current poverty thresholds with its Regional Price Parity (RPP), and then poverty rates (the share of households below the threshold) are recomputed using these regionally adjusted thresholds. For each state, the federal agencies would then select the poverty measure (the current poverty line or the Regionally Adjusted Poverty Line) that yields the higher poverty rate and use that index for most administrative purposes, including determining eligibility for many federal programs. There is a carve-out for ACA Premium Tax Credits: states that did not expand Medicaid would have flexibility to use either measure to preserve access to credits. The bill also requires a GAO study on the ALICE threshold (an asset-limited, income-constrained, employed measure) to compare it with the current poverty line and explore potential alignment with federal programs. The act defines several terms (ALICE, poverty line, poverty threshold, Regional Price Parity) and sets phased effective dates: the RAPL framework takes effect one year after enactment, and the state-by-state selection and use for program eligibility takes effect three years after enactment.
Key Points
- 1Establishes a new Regionally Adjusted Poverty Line (RAPL) published annually for each state, to reflect regional costs of living.
- 2RAPL is computed by multiplying the state’s current poverty thresholds by its Regional Price Parity (divided by 100), and then re-estimating poverty rates using these adjusted thresholds.
- 3For each state, the federal government would adopt the poverty measure (RAPL or current poverty line) that yields a higher poverty rate, and use that measure for most federal program eligibility; ACA Premium Tax Credits offer flexibility to use either measure in certain cases (notably in states not expanding Medicaid).
- 4Requires a GAO study within two years to compare ALICE against the current poverty line, assess possible improvements, and consider how ALICE could be incorporated into federal program eligibility.
- 5Defines key terms (ALICE threshold, poverty line, poverty threshold, Regional Price Parity, State) and sets implementation dates: RAPL begins one year after enactment; the state-by-state selection for program eligibility begins three years after enactment.