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Using the American Community Survey: Benefits and Challenges
children in specific age ranges, leaving it to state agencies to make further allocations to localities. In this instance, the most straightforward method for taking advantage of the ACS would simply be to substitute up-to-date ACS 1-year period estimates for the long-outdated 2000 census long-form-sample estimates in the formula. The ACS 1-year period estimates should have low sampling error for all 50 states and the District of Columbia. For example, estimates of poor school-age children may have a coefficient of variation of less than 8 percent for the smallest states, with about 600,000 people (see Table 2-7a), while the coefficient of variation of these estimates may be only 1 percent for the largest states, with 20 million people. Moreover, the Special Education Grants Program has minimum funding provisions that would moderate year-to-year fluctuations in allocation amounts from the use of annually updated ACS 1-year period estimates in place of the once-a-decade long-form-sample estimates. Should it be deemed desirable to further smooth funding amounts, the Special Education Grants Program could average 2 years of 1-year period estimates or use 3-year period estimates, which should have very low sampling error for all 50 states and the District of Columbia.
Programs like Community Development Block Grants and Home Investment Partnerships, however, provide funds to different types of governmental units, some of which are smaller in population size than the cutoff of 65,000 people or more for ACS 1-year period estimates. For these programs, it will not be possible to take the simple approach outlined above because ACS 1-year period estimates will not be available for all eligible areas. Moreover, while ACS 3-year period estimates may be available for all eligible areas, they may not be sufficiently precise for some of them. For example, should the needed estimates represent a group as small as poor school-age children, then the 3-year period estimates will not have a reasonably small coefficient of variation until the eligible area has a population of at least 80,000 people (see Table 2-7a).7
For such programs as Community Development Block Grants, for which governmental units as small as 50,000 people are eligible for funding, agencies must carefully balance the need for more up-to-date information from using 3-year period estimates against precision requirements that will be better satisfied with 5-year period estimates. For programs for which governmental units must have at least 100,000 people to be eligible for
Table 2-7a should be used only as a very rough guide to expected levels of sampling error for estimates for different size areas from ACS 1-year, 3-year, and 5-year period estimates. The sampling error will differ from that shown in the table for a characteristic that is a different percentage of the population from poor school-age children (as seen in Table 2-8). The sampling error will also depend on the sample size that the ACS achieves in the field for the particular governmental unit.