Statistical Issues in Allocating Funds by Formula (2003) / Chapter Skim
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6. Data Sources for Estimating Formula Components
6. Data Sources for Estimating Formula Components
Pages 50-58
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From page 50... ...
Specifically, we discuss how data sources for each formula component are determined, which sources are most commonly used, and what considerations are relevant in choosing from among alternative data sources. WHO DETERMINES WHAT DATA SOURCES ARE TO BE USED' For some programs, the original authorizing legislation or various amendments to it are very specific about the form of the allocation formula and data sources for each formula element.
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From page 51... ...
Thus, the Food and Nutrition Service of the U.S. Department of Agriculture was responsible for determining what data sources and procedures should be used to estimate formula components.
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From page 52... ...
. DATA SOURCES A wide variety of data sources are used to estimate formula components for the more than 180 federal formula allocation programs.
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From page 53... ...
Due to their lack of timeliness and the availability of more current estimates from the Census Bureau, decennial census data are now used less as formula inputs.2 The community development block grants program provides an exception; several of the elements in the two alternative formulas use data from the most recent decennial census. Also, Census data are required for metropolitan cities and urban counties for such characteristics as population in poverty, the number of housing units with more than 1.01 persons per room, and the number of housing units built before 1940.
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From page 54... ...
The food grant portion of the school lunch program uses data from the food away from home component of the Bureau of Labor Statistics' consumer price index for annual updates of national average prices for free, reduced price, and paid lunches. The cost factor in the allocation formula for SCHIP is based on Bureau of Labor Statistics data on mean annual wages in the health services industry.
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From page 55... ...
CONSIDERATIONS IN THE SELECTION OF DATA SOURCES As previously indicated, data sources to be used in estimating formula inputs are sometimes specified in the authorizing legislation; sometimes the choice is left to the program agency. In all situations, factors to consider in deciding what data sources to use, relate to data quality and to evaluation of the costs and benefits associated with the use of alternative data sources.
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From page 56... ...
Even if the primary goal of program designers is to arrive at a predetermined allocation, choice of data sources that provide a good conceptual fit may improve the initial and ongoing credibility of the allocation process. · The level of geographic Retail at which data are provided.
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From page 57... ...
Even when data sources created for other purposes are used, there may be significant costs of obtaining data in a suitable format, mapping variable definitions into those needed and evaluating the performance of the inputs. Hence, the potential benefits conferred by improving conceptual fit or other aspects of data quality have to be weighed against the cost of such improvements.
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From page 58... ...
Determining the likely program effects of such changes is much more difficult. The sometimes tenuous links between improved inputs to formulas and attainment of goals for increases in social welfare have implications for how much to invest in developing new or improved data for allocation purposes.
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