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This overview will describe the calculation at the Moderate Income level. Calculations at the Low and Very Low Income levels use the same general procedure.

**Step One**: Look up the 4-person **income limit** (PDF
— Excel)
for the area in the income limits table. If the area is in a
metropolitan area, the metropolitan area (MA) code in the block
group data record will tell you which income limit record to select
from the income limits table. If the block group area is not in a
metropolitan area, the combination of state and county codes in the
block group data record determine which income limit to
use.

**Step Two**: Adjust the 4-person income limit based on
the block group area's average family size and average
non-family-household size.

The 4-person income limit is increased 8% for each person above 4 and reduced by 10% for each person less than 4. For example, the 3-person limit is 90% of the 4-person limit and the 6-person limit is 116% of the 4-person limit.

Average family size is calculated using two data items from table P9 in SF3: P009003 (family population) divided by P009004 number of family households). Average non-family household size is calculated from three items: P009017 (population of non-family households) divided by the sum of P009018 and P009021 (these are the variables for male and female non family householders). For purposes of calculating size adjustment to the 4-person income limit, all fractions should be rounded up. For example, if average family size calculates as 5.1 persons, round up to 6 persons; if average non-family household size calculates as 1.1 persons, round up to 2 persons.

**Step Three**: Estimate the number of families below the
size-adjusted family income limit for the block group
area.

Determine which group in SF3 table P76 contains the size-adjusted family income limit for the block group. Assume that limit is $32,000. This income falls in the range covered by item P076007 ($30,000 to $34,999). The number of Moderate Income families is 40% (($32,000-$30,000)/ ($34,999-$30,000)) of P076007, plus the sum of the families with incomes in groups below $30,000 (items P076002 through P076006).

**Step Four**: Calculate the number of persons in Moderate
Income families. Multiply the number of families by average family
size calculated to one decimal place. For example, if average family
size is 3.1 and if the estimate of Moderate Income families from
Step Three is 128, the number of persons would be 397.

**Step Five**: Estimate the number of non-family
households below the size-adjusted non-family household income limit
for the block group area.

Determine which group in SF3 table P79 contains the size-adjusted non-family household income limit for the block group. Assume that limit is $18,500. This income falls in the range covered by item P079004 ($15,000 to $19,999). The number of Moderate Income non-family households is 70% (($18,500-$15,000)/ ($19,999-$15,000)) of P079004, plus the sum of the families with incomes in groups below $15,000 (items P079002 and P079003).

**Step Six**: Calculate the number of persons in Moderate
Income non-family households. Multiply the number of non-family
households by average non-family household size calculated to one
decimal place. For example, if average family size is 1.9 and if the
estimate of Moderate Income non-family households from Step Five is
38, the number of persons would be 72.

**Step Seven**: Sum the population of Moderate Income
families and non-family households. This is total Moderate Income
population for the block group area.

Source: "http://www.hud.gov/offices/cpd/systems/census/lowmod/calculation.cfm".