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Computations for the 2007 Annual Update of the HHS Poverty Guidelines for the 48 Contiguous States and the District of Columbia

Persons in family or household
Poverty thresholds for 2005 — published Aug. 2006a/
Column 2 multiplied by 1.032 price inflatorb/
Difference between successive Column 3 entries
Average difference in Column 4c/
January 2007 poverty guidelines
1 $9,973 $10,292     $10,210
      $2,871 $3,480  
2 12,755 13,163     13,690
      2,912 3,480  
3 15,577 16,075     17,170
      4,535 3,480  
4 19,971 20,610     20,650d/
      3,759 3,480  
5 23,613 24,369     24,130
      3,168 3,480  
6 26,683 27,537     27,610
      3,680 3,480  
7 30,249 31,217     31,090
      3,469 3,480  
8 33,610 34,686     34,570

a/  Column 2 entries are weighted average poverty thresholds from U.S. Census Bureau, Current Population Reports, Series P60-231, Income, Poverty, and Health Insurance Coverage in the United States:  2005, Washington, D.C., U.S. Government Printing Office, August 2006, p. 45.

b/  Price inflation calculated from Table 1A of U.S. Department of Labor, Consumer Price Index press release (USDL-07-0074), January 18, 2007.  (The Consumer Price Index (CPI-U) for all items was 195.3 for calendar year 2005 and 201.6 for calendar year 2006, an increase of 3.2 percent.)

c/  The arithmetic average of Column 4 entries, rounded to the nearest multiple of $20.

d/  Obtained by multiplying the average poverty threshold for a family of four persons for 2005 ($19,971, from Column 2) by the price increase factor from 2005 to 2006 (1.032) and rounding the result upward to the nearest whole multiple of $50.  All other entries in Column 6 are obtained by successive addition or subtraction of the average difference ($3,480) to the size–4 2007 guideline entry ($20,650).

For Alaska and Hawaii, where the cost of living is traditionally believed to be significantly higher than in other states, scaling factors of 1.25 and 1.15, respectively, are applied to the 2007 guideline for a family or household of four for the 48 contiguous states, and the results (if not already a multiple of $10) are rounded upward to the nearest whole multiple of $10.  (These scaling factors were based on Office of Economic Opportunity administrative practice for these two states only beginning in the 1966-1970 period.)  These scaling factors are applied to the average difference for the 48 contiguous states (Column 5) to obtain average differences for Alaska and Hawaii for deriving guidelines for other family or household sizes; these average differences for Alaska and Hawaii are rounded to the nearest multiple of $10.  For families or households with more than 8 persons, add the following amount for each additional person: $3,480 (48 contiguous states and the District of Columbia); $4,350 (Alaska); $4,000 (Hawaii).