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Poverty in Montana
What is poverty?
The United State has two tools for measuring poverty. Poverty thresholds are used for statistical purposes such as calculating the number of people living in poverty and are issued each year by the Census Bureau.
To calculate poverty thresholds, the federal government estimates the annual amount of cash income minimally required to support families of various sizes. The methodology used in this calculation was established in the mid-1960s and has not been updated in the intervening years. The calculation uses pretax cash income and excludes non-cash benefits such as public housing, Medicaid, and food stamps. The guidelines do not include the costs of health care, child support obligations, fines and fees, home or renter insurance premiums, security deposits, transportation and vehicle maintenance costs, life insurance and other common expenses of daily living.
Poverty guidelines(1) (shown in the table below) are a simplified version of poverty thresholds, and are issued by the Department of Health and Human Services to determine financial eligibility for certain federal programs.(2)
2008 Federal Poverty Guidelines
| Persons in Family Unit |
Yearly income |
Monthly income |
Hourly income |
1 |
$15,600 |
$1,300 |
$7.50 |
2 |
$21,000 |
$1,750 |
$10.09 |
3 |
$26,400 |
$2,200 |
$12.69 |
4 |
$31,800 |
$2,650 |
$15.29 |
5 |
$37,200 |
$3,100 |
$17.88 |
6 |
$42,600 |
$3,550 |
$20.48 |
7 |
$48,000 |
$4,000 |
$23.08 |
8 |
$53,400 |
$4,450 |
$25.67 |
| For each additional person, add |
$5,400 |
$450 |
$2.60 |
Source: aspe.hhs.gov -
The poverty guidelines reflected here display 150% of the federal poverty guidelines, some program eligibility is lower then the 150% threshold. Please contact District 7 HRDC for specific program guidelines for eligibility.
What are the conditions of poverty?
People living in conditions of poverty are unable to meet their basic needs for food, shelter, heat, utilities, clothing, transportation, health and childcare. Many residents living at or above Federal Poverty Level are economically insecure. They must choose which basic needs they will fulfill.
How expensive is it to live here?
Housing is considered unaffordable if it costs more than one-third of the household’s monthly income. A family needs an annual income of $21,840 ($10.50 hourly wage) to afford an average two-bedroom rental unit in Montana. This housing burden puts them at risk for financial crisis. One ordinary, unexpected expense can be catastrophic.
The following lists annual income needed to afford an averaged two-bedroom rental unit.(3)
Big Horn County (earning $11,070, 30% of the Area Median Income of 36,900) can afford rent of no more than $277, while the Fair Market Rent for a two-bedroom unit is $468
Carbon County (earning $13,350, 30% of the Area Median Income of $44,500) can afford rent of no more than $334, while the FMR for a two-bedroom is $491
Stillwater County (earning $17,670, 30% of the Area Median Income of $58,900) can afford rent of no more than $442, while the Fair Market Rent for a two-bedroom unit is $431
Sweet Grass County (earning $13,440, 30% of the Area Median Income of $44,800) can afford rent of no more than $336, while the Fair Market Rent for a two-bedroom unit is $431
Yellowstone County (earning $16,080, 30% of the Area Median Income of $53,600) can afford rent of no more than $402, while the Fair Market Rent for a two-bedroom unit is $561
A minimum wage earner (earning $5.15 per hour) can afford monthly rent of no more than $268. In Montana, a worker earning the Minimum Wage ($5.15 per hour) must work 82 hours per week in order to afford a two-bedroom unit at the area's Fair Market Rent.
An SSI recipient (receiving $564 monthly) can afford monthly rent of no more than $169, while the Fair Market Rent for a one-bedroom unit is $433.(4)
How many people are living in poverty?
Poverty in Montana continues to increase. From 2000 to 2005 the number of people living in poverty according to Federal Poverty Guidelines grew from 32,575 to 50,532. In 2005 there were 131,133 individuals out of 910,651 total population in Montana whose income was below the poverty level.
In 2004:
Big Horn County had 23.1% of the population below the poverty level
Carbon County had 10.2% of the population below the poverty level
Stillwater County had 8.6% of the population below the poverty level
Sweet Grass County had 9.4% of the population below the poverty level
Yellowstone County had 12% of the population below the poverty level
Why are people poor?
There are four types of poverty:
1. People with special needs who have limited or no opportunity for employment because they are severely disabled or elder
2. Individuals who experience long-term poverty due to generational influences, lack of language fluency, or basic life or work skills
3. People who experience unexpected or episodic poverty due to job loss, divorce, domestic violence or a short-term disability
4. People who experience poverty due to inadequate income that doesn’t support their basic needs. This group may be working part-time or working full-time for low wages without benefits.
What is the median income here?
Median Income: Median means half of the population earns more, the other half of the population earns less. (6)
The 2004 median family income is listed for the following counties:(15)
Big Horn County: $36,900
Carbon County: $44,500
Stillwater County: $58,900
Sweet Grass County: $44,800
Yellowstone County: $53,600
Footnotes:
1. Federal Poverty Guidelines, U.S. Department of Health and Human Services http://aspe.hhs.gov/poverty/04poverty.shtml
2. Out of Reach 2004: America’s Housing Wage Climbs, National Low Income Housing Coalition http://www.nlihc.org/oor2004/
3. Out of Reach 2004: America’s Housing Wage climbs
4. Out of Reach 2004: America’s Housing Wage climbs
5. U.S. Census – 2003 Montana Fact Sheet http://www.census.gov/acs/
6. U.S. Census – 2003 Montana Fact Sheet
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Copyright © 2005 District 7 HRDC
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