Methodology/Errata

Framework
Graded Outcome Index
Important Notes
Policy Priorities
Additional Policies
Data Sources and Limitations
Timeliness of Data
New and Omitted Measures
Errata

Framework

The 2009-2010 Assets and Opportunity Scorecard provides a picture, from an asset-based perspective, of both policy and performance at the state level. In developing the Scorecard's framework and measures, CFED draws upon its own hands-on experience in technical assistance and strategic policy design as well as the expertise of external advisors.

To present a revealing portrait of each state and the District of Columbia, CFED has compiled 58 outcome measures and 34 policy measures organized into a six-issue area framework: Financial Assets & Income, Businesses & Jobs, Housing & Homeownership, Health Care, Education and Community Investment & Accountability. The first five issue areas contain graded outcome measures and rated policy measures. The Community Investment & Accountability issue area contains four policy measures and no outcome measures.

The group of 34 policy measures includes 12 priority policies and 22 additional policies. The policy priorities are those CFED views as critical for a state to have in order to promote a positive asset environment. They are by no means the only policies that states could or should adopt to expand economic opportunity; however, these 12 reflect key policy solutions in each of the five main issue areas (there are no policy priorities in the Community Investment & Accountability issue area) and provide a starting point for individual states to design a roster of policies to aim to achieve.

Graded Outcome Index

The five main issue areas – Financial Assets & Income, Businesses & Jobs, Housing & Homeownership, Health Care and Education – contain graded outcome measures. (There are no outcome measures in the Community Investment & Accountability issue area.) Each issue area contains between nine and 15 outcome measures that add up to a total of 58.

The outcome measures are primarily numerical data that are relatively straightforward to present, rank and grade. Issue area outcome grades are calculated as follows:

Data are collected for the 58 outcome measures.

Each state is individually ranked in every measure based on the raw data obtained. The state with the most desirable outcome is ranked 1st and the least desirable is ranked 51st. For example, the state with the highest net worth is ranked 1st. Similarly, because a low asset poverty rate is desirable, the state with the lowest asset poverty is ranked 1st. Because of issues of sample size in our source data, data for a small number of the outcome measures are not available for every state. In those instances, the rankings are not out of a total of 51 but of the number of states for which data are available. For example, we have data on asset poverty by race for only 33 states; the state with the least desirable outcome is ranked 33rd.

To calculate the grade for each issue area, the ranks for all of a state's measures in the issue area are added together and averaged (all measures are weighted equally). The lower the average, the better the state's overall performance for that issue area. Once issue area averages are calculated for all of the states, those averages are again ranked (the best rank is 1st, and the worst rank is 51st) and a grade is assigned to each state. The grades are assigned on a curve: states that rank from 1 to 10 earn an A; from 11 to 20 earn a B; from 21 to 36 earn a C; from 37 to 46 earn a D; and from 47 to 51 earn an F.

The overall outcome grade is calculated by adding the ranks for each issue area, re-ranking the states from 1 to 51 and then assigning each state a grade based on the distribution described above. Each issue area is weighted equally in calculating the overall grade.

Important Notes

Missing data were accounted for by shifting the weight of the rank onto the other measures in the issue area. Therefore, a state was not punished due to a lack of data availability. As a result, each of the remaining measures in the index weighed more heavily in the state's grade than they did for a state that had data available for all measures.

When a tie occurred in the data, each state received the same rank, and the next-best performing state was ranked as if the tie had not occurred. For example, if two states had the best score, each was ranked 1st, and the next state was ranked 3rd.

Number of decimal places for measures are limited for presentation purposes. State ranks are based on full number. Two states might therefore have different ranks even though the measures appear to be the same. For complete data, download the 2009-2010 Scorecard data file.

Policy Priorities

The 2009-2010 Scorecard is the second edition to select and highlight a dozen policies as especially important. By highlighting 12 of the 34 policies as policy priorities, the Scorecard puts forth clear recommendations for what state policymakers can and should do to provide financial security and opportunity. States should use these 12 policies as the starting point for a proactive asset policy agenda and pursue those policies that reflect the particular needs of their state. The Scorecard evaluates each state on the strength of its policy priorities, utilizing easy-to-follow policy icons.

The 12 policies are drawn from the five main issue areas in the Scorecard: Financial Assets & Income, Businesses & Jobs, Housing & Homeownership, Health Care and Education. None of these policies alone is the silver bullet, but each is a piece of the assets puzzle. There is no overall policy priority rating for the states, but rather 12 individual ratings for each policy priority.

Unlike the outcome measures that rank states relative to one another, for the policy priority measures, states are assessed against an absolute standard for what constitutes strong policy that is specific to each policy priority. For each of the 12 policy priorities, CFED gathered the best available research and guidance from the foremost policy experts in the field to develop key criteria for a strong policy. States are rated based on whether they meet these criteria. Ratings are based on the following scale:

Key

Criteria used to rate state policies vary among the 12 policy priorities and are specific to individual policies. For complete information on these policies, click here.

Additional Policies

For all six issue areas – Financial Assets & Income, Businesses & Jobs, Housing & Homeownership, Health Care, Education and Community Investment & Accountability – the Scorecard provides information on 22 policies in addition to the 12 policy priorities. While the strength of states' additional policies are not evaluated and rated, the Scorecard includes this data to provide a comprehensive picture of state policies that support a positive asset-building and asset-protection environment. For a complete list of these policy measures and additional information on them, click here.

Data Sources and Limitations

With any research endeavor, the data are never completely sufficient. This is also true for the 2009-2010 Assets Opportunity Scorecard. Most of the data are gathered from publicly available sources, such as the U.S. Census Bureau and nonprofit research and policy organizations. Because the Scorecard is driven by what needs to be known about assets and not just by what is readily known, new data were commissioned for the Scorecard. Using data from the Survey of Income and Program Participation (SIPP), Beacon Economics generated estimates of household net worth, asset inequality and asset poverty at the state level. Additionally, Beacon used data from the Current Population Survey (CPS) to rescale the SIPP weights to provide a sample that is representative of demographics at the state level. The rescaling was designed to make the sample of observations present in the SIPP data set consistent with the CPS on the basis of race, gender and broad income status.

In some instances, proxies – indirect means of getting answers to important questions – are used. In generally, these situations arose because no one previously had asked bout or collected data on these issues at the state level.

Policy data for the Scorecard is drawn from research and resources created mainly by policy organizations, academic institutions and think tanks with expertise in the specific issue areas covered in the Scorecard. The particular policies selected for inclusion in the Scorecard – and the criteria for assessing the strength of those policies – were identified through conversations with experts and CFED's own knowledge of asset policies that are promising, proven or effective in helping families build and protect assets. Where information on the state-by-state status of policies was not already documented, CFED consulted with experts and conducted original research using StateNet (a state legislative tracking service), online surveys and telephone interviews.

Timeliness of Data

The Scorecard draws on a wide range of data sources to produce a comprehensive picture of financial security and economic opportunity. Data collection for the outcome measures included in the 2009-2010 Scorecard took place between December 2008 and April 2009, and most of the data reference the 2006-2008 time period.

Some of the outcome measures used in the Scorecard are collected from sources that are updated quarterly or annually (such as foreclosure and unemployment), while others are only available every two to five years (such as net worth and small business ownership by race and gender). In addition, even when data is relatively current in terms of release date, it can reference a time period that is several years in the past. Because of this lag, even though the Scorecard draws on the most recent data available at the time of production, it is inevitable that some of the data becomes out-of-date rather quickly, while other measures reflect long time lags. Both types of data issues limit the Scorecard's ability to reflect recent changes that have taken place in the economy. But such issues do not take away from the power of the Scorecard to tell a story of relative performance compared to every other state during the same time period.

Data collection for the policy measures in the Scorecard took place between February and June, 2009. With a few exceptions, the 12 policy priorities reflect what was adopted as of the end of June, 2009 (the end of most state legislative sessions). Data for the 22 additional policy measures in the Scorecard are collected from external policy experts and organizations and reflect the most recent data available from these sources.

New and Omitted Measures

This edition of the Scorecard has been updated and improved in several significant ways from the 2007-2008 edition. For the first time, the Scorecard incorporates measures on job quality and assesses states on wage and income trends, in acknowledgement of the fact that overall earning potential and job stability are critical elements of savings and asset building. The Scorecard also offers an expanded view of health care by including data on the cost of health insurance and out-of-pocket medical expenses. The Scorecard also includes new data on college debt that describes the financial burden students and families must take on to access the education critical to attaining future income and financial security. In addition to these changes to the outcome measures, the mix of policy priorities and the criteria used to assess the strength of state action have been revisited to reflect the best thinking on what states can and should do to promote economic opportunity. This edition of the Scorecard also describes a number of "innovative policies" that, while not all currently enacted or widely known, are under active consideration by state policymakers. These policies represent some of the most promising and inventive actions states can take to expand economic opportunity.

Errata

All of the materials available for download online are correct. However, the following is a list of errors that were found in Scorecard documents printed before the Scorecard was issued on September 21, 2009.

State Profiles

Policy Briefs

Resource Guides

State Policy Priority Ratings