earnings for up to two jobs. A possibility for obtaining after-tax income would be to ask for net pay after deductions for Social Security and payroll taxes. A drawback is that such monthly pay information probably would not reflect the EITC. Another alternative would be for the Food and Nutrition Service, with guidance from the Census Bureau, to provide schools with a simple formula for calculating payroll and net income taxes from information on gross earnings and family composition. The specifications could indicate an income level above which it would not be necessary to estimate taxes; in other words, there should be no need to go through the calculation for families clearly above the thresholds.

For child care costs and child support payments, it seems fairly straightforward to ask families if they pay for child care or child support and their typical monthly costs. The flat deduction for commuting and other work-related expenses would not require asking families for any added information. With regard to in-kind benefits, it would not be necessary to ask about food stamp income, because food stamp families are automatically eligible.12 Families could be asked if they receive housing assistance, although the value of such assistance is difficult to determine, and it might be wise, for administrative ease, to ignore this source of income.13 Finally, rather than asking families about last month's out-of-pocket medical costs, which might not be representative of their annual costs, it might be easier simply to ask whether they have public or private health insurance. The Food and Nutrition Service, with guidance from the Census Bureau, could provide schools with a formula for assigning average out-of-pocket expenses to applicants on the basis of their family composition (including ages of family members) and insurance coverage.

The process just described for determining disposable income would be more involved than the current process for determining gross money income. However, we think that a "cookbook" (which might be computerized) could be developed for state and local agencies that would provide a reasonably straightforward way to calculate disposable income with acceptable accuracy with only a few added questions being asked of applicants.

An alternative approach would be to develop a "menu" of poverty thresholds for different types of families—such as working families with and without child care expenses and with and without health insurance coverage—that are appropriate to compare with a gross money income definition of family resources. For example, the threshold for a working family of two adults and


However, programs that rely solely on comparing income with the poverty guidelines to determine eligibility and do not accord automatic eligibility to welfare families would need to ask about food stamps and, perhaps, other sources of in-kind income.


In fact, many public housing recipients are also receiving food stamps or AFDC and hence would not need to be queried about income. Data from the 1991 American Housing Survey showed that 54 percent of renters receiving housing assistance also received food stamps (Nelson and Redburn, 1994: Table 1).

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