One emergency away
By Lori Adler, reporter
Affordable housing is a key factor to keeping families from becoming homeless. Many in the Northwoods are operating on a budget that is just one emergency away from putting them out on the street.
It is recommended by financial experts that housing costs should never exceed 30% of a family’s total budget. This allows for a little money to be put aside in case of an emergency, such as an unexpected medical bill or car repair. However, many families simply do not have the luxury of savings because all their income is tied up in family expenses.
The government agency HUD (Housing and Urban Development) lists fair market rental rates for housing in Oneida County. According to HUD, a one-bedroom unit averages $697 per month, while a two-bedroom unit will cost $872 per month on average. In order to remain within the 30% rule, this means the renter of a one-bedroom unit must earn at least $13.41 per hour or $16.77 per hour for a two-bedroom unit.
These suggested hourly wages are higher than what many area workers receive. And while a two-parent household could potentially have two workers, when children are involved, it often does not make sense for both parents to work due to the high cost of childcare.
This situation is what leads many to seek government assistance. However, the income levels used by government agencies to determine qualification for assistance programs are considered outdated by some.
According to a historical document from the Social Security Administration (SSA), the federal poverty thresholds were first created by an SSA economist in 1963. At that time, food was considered to be 30% of a family’s budget, and using USDA pricing, the economist established the poverty thresholds at three times the food costs for a family, depending upon family size. Though housing and other expenses now outweigh food in a family’s budget, these guidelines are still used, updated for cost-of-living increases each year. In addition, these guidelines make no adjustments for location, except for increases for Hawaii and Alaska.
While many agencies use 150%-200% of the federal poverty thresholds (or their own slight variations) as the determining factor for assistance, several other guidelines have been established in an attempt to more accurately represent what a family needs to survive.
For example, the 2019 Federal poverty level for a family of four (not living in Hawaii or Alaska) is an annual income of $25,750 or less. If only one of the four household members is working, that equates to a full-time job earning $12.38 per hour.
Massachusetts Institute of Technology (MIT) has come up with a living wage calculator that they feel is more accurate. The calculator is based upon location (down to the county level) as well as the composition of the household (number of adults and children) and how many of the adults are working.
The MIT calculator figured the living wage for a household of two adults and two children with one adult working in Oneida County to be $49,275 annually or $23.69 per hour. The Living Wage calculations use only basic expenses such as housing, food, transportation and medical to determine the necessary income levels.
Though the MIT calculator may appear to be more accurate to some, this measure still does not allow for any type of savings for unplanned expenses, leaving many families just one emergency away from a dire situation.