American businesses and state and local governments would lose access to up-to-date demographic and economic data under a provision in the proposed House budget version that would abolish the American Community Survey.
The ACS was created in the late 1990s by the Census Bureau to collect the demographic data historically collected on the long form used during the decennial censuses. The survey was fully implemented in 2005.The ACS, which is mandatory, is sent to 3 million households annually and is used to provide more up-to-date data than that collected once a decade at the time of the Census.
Many of the demographic questions on the ACS have been included at the request of Congress and federal agencies. These questions provide information that is used in the allocation of nearly $400 billion in federal and state funding and also help the federal government to target federal programs and funding to areas of need. Failure to return the ACS can result in fine of up to $5,000.
Rep. Daniel Webster (R-Fla.), the author of the legislation that would abolish the ACS, criticizes the survey for invading people’s privacy by requiring them to answer questions about their commutes to work, whether they need assistance with various life tasks, among others. He is quoted as saying, “We need to ask ourselves whether this survey is worth $2.4 billion.”
Last year, Rep. Ted Poe (R-Texas) introduced H.R. 190, which sought to make responding to the ACS voluntary. Many statisticians and other data users had expressed concern about making this form voluntary because a lower response rate on the ACS would have required costly in-person follow up by Census Bureau staff to get the required data.
In addition, it may eventually have required the Census Bureau to bring back the long-form census (which went to about 17 percent of the population or one in six households) for the 2020 decennial census. The full implementation of the ACS in 2005 led to the 2010 decennial census becoming a short form that contained only 10 questions since the demographic data is collected on the ACS.
County governments are among the stakeholders that will be hit hardest if this program is abolished. The data from the ACS is used primarily in the distribution of federal funds, and in this era of scarce resources it is imperative that that data is accurate and up-to-date. Also, counties use this data for their own internal purposes, such as planning, assessing the makeup of their communities, housing needs, commuting patterns, school, curriculum and classroom needs, educational levels, and other data that help to determine their community and economic development needs.
An article in the May 10 Business Week outlined how curtailing the ACS would hit the business community hard also. The article cited the Chamber of Commerce, which relies on the data for information such as household spending, per capita income and population estimates. Businesses also rely heavily on the data to help make decisions about where to build new stores and hire new employees, and to get valuable insights on consumer spending habits. Another business executive has said that without accurate economic and demographic data such as that collected on the ACS, businesses “would be flying blind” when trying to make decisions and possibly lose much more than funding the surveys would cost.
Andrew Reamer, a professor at the George Washington Institute of Public Policy, said the “the loss of the American Community Survey will cause chaos and inefficiency in the operations of business and government in the U.S.
Many conservative organizations have come out in support of the continuation of the ACS. Bloomberg Business Week reports that economists at conservative think tanks Cato Institute, American Enterprise Institute (AEI) and the Heritage Foundation all expressed support for the data-gathering surveys since they rely heavily on the statistics they produce to study the economy. “Those agencies are essential,” said Phillip Swagel, an economist and non-resident scholar at AEI. “The data they provide really tell us what’s going on in the economy.”
Political strategists have stated that they believe that this piece of legislation may become a bargaining point once the new spending bill goes to the Senate. They believe that the House will agree to continue to fund the American Community Survey in exchange for making responses voluntary.