Overlooked Suburbs: The Changing Metropolitan Geography of Poverty in the Western United States

Executive Summary

This report examines trends between 1990 and 2014—18 in the location of populations experiencing poverty, which we define as those with incomes below the federal poverty line, within metropolitan regions in the United States, with a particular focus on the western United States.

We explore how growing suburban poverty is distributed across jurisdictional boundaries that shape governance outcomes, including incorporated and unincorporated suburbs. The size of a suburb and its incorporation status affect its position within local-regional political structures, and smaller suburbs may be overlooked by public, private, and nonprofit organizations in the community development field. Size and incorporation status also affect a suburb’s access to certain federal funds, including the Community Development Block Grant (CDBG) program, a key source of funding for local antipoverty programs. Variation in the distribution of populations experiencing poverty across census regions and metropolitan areas has implications for public and philanthropic spending on social services for low- and moderate-income populations.

In this report, we first discuss average trends in the distribution of poverty across urban and suburban jurisdictions in five census regions. For comparison, we divide metropolitan areas into five geographies—the largest city in a metro area, other principal cities, large suburban cities, small suburban cities, and unincorporated areas. Next, we profile 14 metropolitan areas in the western United States through “data snapshots” showing changes in poverty rates and racial and ethnic demographics. We conclude by discussing the implications of these trends for community development practitioners seeking to promote economic participation and financial stability among low- and moderate-income communities and communities of color.

In the largest metropolitan areas in the western United States, the average share of the population with incomes below the federal poverty line rose in large suburban municipalities with populations over 50,000 and declined in the largest principal cities between 1990 and 2014—18.

• Although poverty rates remained high in the largest cities in the metropolitan area, the greatest share of people experiencing poverty lived in suburbs, with growth on this measure occurring primarily in large incorporated suburbs.

The growth of suburban poverty, primarily in large suburbs, puts the metropolitan areas in the western United States in a favorable position to assist people experiencing poverty, compared with other parts of the country.

• In the largest metropolitan areas in the Midwest, suburban poverty grew primarily in small incorporated suburbs between 1990 and 2014—18.
  • Among small suburbs in the Midwest, poverty rates have grown unevenly. Increasingly, people experiencing poverty are living in small suburbs with poverty rates that exceed those of the metropolitan area and their neighboring suburbs.
• In the largest metropolitan areas in the Northeast, suburban poverty grew slightly in unincorporated suburbs, small suburban cities, and large suburban cities.
  • Among small and large suburban jurisdictions in the Northeast, poverty rates have grown unevenly, with higher- and lower-income people increasingly living in different suburban jurisdictions.
• In the South, suburban poverty grew primarily in unincorporated areas. Unincorporated population centers, governed by counties, may be more underresourced than their surrounding cities.
• In the Pacific West and Mountain West, large incorporated suburbs experienced most of the growth in suburban poverty.
  • With larger tax bases and direct access to federal dollars, suburban cities with populations over 50,000 have a greater ability to muster resources than do smaller municipalities or unincorporated areas.
  • Compared with other parts of the country, there are fewer jurisdictions in the western United States with elevated poverty rates, compared with their metropolitan area and surrounding suburbs.

Although many metropolitan areas in the western United States should be positioned to fare better from a governance perspective than other parts of the country, suburban poverty remains a largely overlooked and underresourced issue.

• Large suburbs should have a greater tax base and capacity for governance than small suburbs. However, where the poverty rates of large suburbs have grown faster than their metropolitan area and their neighbors, there may be a need for assistance from the community development field to better serve low-income populations.
• Small suburbs and unincorporated areas, particularly those whose poverty rates are significantly higher than the metro area and their surrounding suburbs, may face particular challenges serving low-income populations.
• The suburbanization of poverty is less pronounced in some of the smaller metropolitan areas in the western United States. With fewer competing jurisdictions, they may be able to better coordinate efforts to serve low-income populations. At the same time, they may have fewer philanthropic resources than larger metro areas.
• Pockets of suburban poverty in metropolitan areas in the western United States present an area for the community development field to better understand and help raise awareness, particularly in relation to other ongoing trends—such as access to affordable housing, transit, and care infrastructure, climate adaptation and resilience work, and economic recovery from the COVID-19 pandemic—that impact participation by low- and moderate-income populations and communities of color in the regional economy. Reducing barriers to economic participation has implications for the Fed’s full employment mandate and for the resilience of metropolitan regions’ economies.

Introduction

Why the size and incorporation status of suburbs matter for low-income people

In the mid-2000s, the number of residents living below the federal poverty line in suburbs surpassed the number of people experiencing poverty in central cities.i But because the term “suburb” encompasses a wide array of places with very different features, the impact that suburban poverty has on opportunity and access to resources varies widely.

Public services and infrastructure that help people participate in the regional economy, such as transit, workforce development, and housing, tend to be governed at the local level by cities and counties. Bigger cities tend to have greater capacity to compete for resources and provide these services. With more people, including low- and moderate-income workers, living outside of the traditional centers of metropolitan regions, the patchwork of cities and counties that govern opportunity and quality of life in the suburbs takes on greater importance. Yet in many places, low-income populations in suburbs are overlooked by the public and philanthropic sectors that engage in community development work, limiting the contribution of these populations to the regional economy.

The governance of suburbs is a critical factor in determining what suburban residence means for low-income people. Two features of local governance are particularly important in whether local governments have the capacity to provide services to low-income residents. The first is the size of the local jurisdiction. A second factor affecting capacity is whether an area is incorporated as a separate jurisdiction or is unincorporated. Lacking a municipal government, unincorporated areas are governed by the county. This affects the lives of low-income suburban residents.

The size of municipal jurisdictions matters for several reasons. Most large jurisdictions have access to a bigger tax base than do smaller jurisdictions. Moreover, cities with populations over 50,000 in a metropolitan region are entitled to directly receive funds from key federal programs that serve low-income populations, including the HOME Investment Partnerships Program and the Community Development Block Grant (CDBG) program.ii iii Jurisdictions below 50,000 people must instead compete with each other to win the attention of county officials charged with distributing funds.iv Research has shown that larger “entitlement” cities were more likely to receive funds from state and federal programs and grants than nonentitlement cities, controlling for race and income, among other factors.v HOME, administered by the federal Department of Housing and Urban Development (HUD), provides funding ($1.35 billion in 2021) for low-income, owner-occupied home rehabilitation and homebuyer assistance; rental housing rehabilitation, acquisition, and construction; and tenant assistance.vi CDBG, also administered by HUD, is a key source of funding ($3.4 billion in 2019) for local programs that encourage economic participation by low- and moderate-income people through neighborhood revitalization, economic development, and job creation.vii Local governments and the community-based organizations they fund use CDBG dollars for the construction and rehabilitation of housing and community facilities and to incorporate renewable energy and energy efficiency into these projects.viii In the event of a federal disaster declaration, HUD allocates special funds through CDBG for recovery efforts.ix

Incorporation status matters because residents in unincorporated areas, lacking municipal government, must rely on counties for services. Although many counties have expansive service capabilities, others remain quite limited.x xi Counties may also face special challenges in addressing poverty. In many suburban counties, leapfrog development and selective incorporation or annexation have left pockets of unincorporated poverty interspersed among more affluent incorporated jurisdictions.xii xiii Local politics and lack of capacity leave some unincorporated areas without basic infrastructure, such as reliable access to clean water.xiv xv Even counties with relatively strong capabilities find it more difficult than bigger cities to address these scattered pockets of unincorporated poverty due to long distances and the low visibility of low-income people.

Additionally, suburbs remain overlooked by nonprofits that serve low-income populations, compounding the challenges of growing poverty and limited public-sector service expenditure.xvi Philanthropic capacity and spending per person experiencing poverty remain disproportionately high in the historically largest cities in metropolitan regions.xvii Spending by philanthropic organizations varies by region, with metro areas in the South and Southwest lacking the historic infrastructure of nonprofits and foundations in other parts of the country.xviii

These features of local governance—jurisdiction size and incorporation status in relation to the suburbanization of poverty—display distinct patterns in different regions of the country.xix In this report, we first compare the governance of suburban poverty across census regions. Next, we present snapshots of the governance of suburban poverty in 14 metropolitan regions in the western United States. We then discuss how patterns of suburban poverty and governance relate to community development policy and practice.

About our research

Research questions

For our analysis of the governance structures that impact low-income populations in metropolitan areas, we asked two questions:

1. What is the distribution of suburban poverty by “geography” or jurisdiction type in a metropolitan region?
2. What is the distribution of suburban poverty within each incorporated suburban geography?

Geographies

To distinguish different types of urban and suburban areas, we divided metro areas into the following geographies:

• Largest city: The first named city in a federally designated metropolitan statistical area (MSA), which is the largest city in an MSA. An MSA is an urbanized area of at least 50,000 people.
• Other principal cities: Up to two other major cities included in the name of an MSA, typically the second- and third-largest cities in a metro area.
• Large suburbs: Additional incorporated places in an MSA with a population over 50,000, the minimum size for direct federal CDBG eligibility.
• Small suburbs: Incorporated places in an MSA with a population below 50,000.
• Unincorporated suburbs: Any unincorporated areas, including census-designated places (CDPs), which are unincorporated population centers, and the remaining unincorporated populations within counties.

Hypothesis

We hypothesized that jurisdictional patterns in the suburbanization of poverty would vary by metropolitan “geography” in different parts of the country, which would have implications for regional governance, the distribution of local services, and capacity for serving low-income populations by the public and nonprofit sectors.

Data sources, methodology, and downloading the data

We used decennial demographic data from the 1990, 2000, and 2010 U.S. census and five-year estimates for 2014—18 from the Census Bureau’s American Community Survey to build a dataset organized by our geographies. To compare different parts of the country, we averaged data for the five largest metropolitan areas in the Northeast, South, Midwest, Mountain West, and Pacific West census regions. We then repeated this analysis for 14 metropolitan areas in the western United States.

For more detail about our methodology, definitions, and data sources, see the Methodological Appendix (pdf, 7.29 mb).

Read the full report (pdf, 7.29 mb). You may also jump to a section in the PDF or download the data from the brief using the following links.

• Trends in the Distribution of Poverty in U.S. Census Regions
• Data Snapshots: Select Metropolitan Areas in the Western United States
  • Boise, Idaho
  • Honolulu, Hawaii
  • Las Vegas, Nevada
  • Los Angeles, California
  • Phoenix, Arizona
  • Portland, Oregon
  • Riverside, California
  • Sacramento, California
  • Salt Lake City, Utah
  • San Diego, California
  • San Francisco, California
  • San Jose, California
  • Seattle, Washington
  • Tucson, Arizona
• Policy and Practice Discussion
• Works Cited
• Methodological Appendix

Download the data (zip, 1.14 mb) for the figures in the report.

The views expressed in this report are those of the authors and do not necessarily reflect the views of the Federal Reserve Bank of San Francisco or the Federal Reserve System.

Acknowledgments

We would like to thank Laura Choi and Bina Shrimali at the SF Fed for their comments on this report. Helpful comments were provided by participants and discussants at the 2020 UC Berkeley Data for Housing workshop, the 2020 American Collegiate Schools of Planning conference, and the Fed System Community Development Research seminar.

End Notes

i. Kneebone, Elizabeth. 2017. “The Changing Geography of U.S. Poverty.” Testimony before the House Ways and Means Committee, Subcommittee on Human Resources, February 15, 2017.

ii. Jaroscak, Joseph V. 2021. “Community Development Block Grants: Funding and Allocation Processes.” Congressional Research Service. [Report].

iii. Jones, Katie. 2021. “An Overview of the HOME Investment Partnerships Program.” Congressional Research Service. [Report].

iv. Jaroscak, Joseph V., Robert Day Dilger, and Julie M. Lawhorn. 2020. “Block Grants: Perspectives and Controversies.” Congressional Research Service. [Report].

v. Craw, Michael. 2010. “Deciding to Provide: Local Decisions on Providing Social Welfare.” American Journal of Political Science 54 (4): 916.

vi. Jones, 2021.

vii. Jaroscak, 2021.

viii. HUD. n.d. “Community Development Block Grants/Entitlement Grants.”

ix. HUD. n.d. “Community Development Block Grant Program Entitlement Fact Sheet.”

x. Lobao, Linda, P. Wilner Jeanty, Mark Partridge, and David Kraybill. 2012. “Poverty and Place across the United States: Do County Governments Matter to the Distribution of Economic Disparities?” International Regional Science Review 35 (2): 158—87.

xi. Miller, David Y., and Raymond W. Cox III. 2014. Governing the Metropolitan Region: America’s New Frontier. London and New York: Routledge. pp. 153—57.

xii. Anderson, Michelle Wilde. 2010. “Cities Inside Out: Race, Poverty, and Exclusion at the Urban Fringe.” UCLA Law Review 55: 1095—160.

xiii. Durst, Noah J. 2014. “Municipal Annexation and the Selective Underbounding of Colonias in Texas’ Lower Rio Grande Valley.” Environment and Planning A 46 (7): 1699–715.

xiv. London, Jonathan, Amanda Fencl, Sara Watterson, Jennifer Jarin, Alfonso Aranda, Aaron King,
Camille Pannu, Phoebe Seaton, Laurel Firestone, Mia Dawson, and Peter Nguyen. 2018. “The Struggle for Water Justice in California’s San Joaquin Valley: A Focus on Disadvantaged Unincorporated Communities.” UC Davis Center for Regional Change. [Report].

xv. Pannu, Camille. 2012. “Drinking Water and Exclusion: A Case Study from California’s Central Valley.” California Law Review 100: 223—67.

xvi. Cytron, Naomi, and Sarah Frankfurth. 2019. “A Way Forward: Addressing Mobile Segregation in the Bay Area.” Federal Reserve Bank of San Francisco Community Development Blog.

xvii. Allard, Scott W. 2017. Places in Need: The Changing Geography of Poverty. New York: Russel Sage. pp. 132—41.

xviii. Reckhow, Sarah, and Margaret Weir. 2011. “Building a Stronger Regional Safety Net: Philanthropy’s Role.” Brookings Metropolitan Opportunity Series.

xix. Mattiuzzi, Elizabeth, and Margaret Weir. 2019. “Governing the New Geography of Poverty in Metropolitan America.” Urban Affairs Review 1—46. doi: 10.1177/1078087419834075.