a

GAO

United States General Accounting Office

Report to Congressional Requesters

December 2001 2000 CENSUS

Significant Increase in 

Cost Per Housing Unit 

Compared to 1990 

Census

GAO-02-31
Page 1 GAO-02-31 Census Cost Per Housing Unit

December 11, 2001

The Honorable Dan Miller

Chairman

The Honorable William Lacy Clay, Jr.

Ranking Minority Member

Subcommittee on the Census

Committee on Government Reform

House of Representatives

The Honorable Carolyn B. Maloney

House of Representatives

The decennial census is the nation’s most comprehensive and expensive

data-gathering program. From providing the basis for apportioning the

U.S. House of Representatives to providing data used by communities,

businesses, and Americans everywhere, the decennial census provides a

great deal of knowledge about our nation. In a previous report,1 we

estimated that when compared to the 1970 census, the projected full-cycle

cost2

 per housing unit of the 2000 census would quadruple and the total

cost would nearly double the costs of the 1990 census.

According to Census officials, the significant cost increase can be

attributed primarily to the bureau’s attempt to achieve a better quality

census than in 1990. According to preliminary data from the Accuracy and

Coverage Evaluation program, it appears that the 2000 census did reduce

the net undercount for children and minorities compared to the 1990

census. However, due to current, ongoing studies and evaluations of the

2000 census, it is too early to determine the full extent of improvements

compared to the 1990 census.

As agreed with your offices, this report responds to your joint request for

us to (1) update full-cycle costs to reflect the most current information and

 1

2000 Census: Analysis of Fiscal Year 2000 Amended Budget Request

(GAO/AIMD/GGD-99-291, September 22, 1999). In this report, we estimated the cost per

housing unit in fiscal year 1998 dollars to be $13 for 1970, $24 for 1980, $31 for 1990, and

$56 for 2000.

2

Full-cycle cost covers all phases of a decennial census, including planning and

development, the actual count or enumeration, and postenumeration studies. For the 2000

census, this includes a 13-year period from fiscal years 1991 through 2003.

United States General Accounting Office

Washington, DC 20548
Page 2 GAO-02-31 Census Cost Per Housing Unit

(2) analyze bureau data to determine the causes of the significant increase

in cost per housing unit for the 2000 census when compared to the cost of

the 1990 census to assist the bureau in planning for the 2010 census. We

did not assess the quality of the 2000 census in this report. This report is

one of several we will be issuing in the coming months on lessons learned

from the 2000 census that can enhance the planning effort for the 2010

census.

We obtained and analyzed financial data from the U.S. Census Bureau to

develop full-cycle costs of the 1970 through 2000 decennial censuses and

converted all amounts to constant fiscal year 2000 dollars. Cost

information provided by the bureau for the 1990 census was limited,

making it difficult to compare costs with the 2000 census. The more

comprehensive cost data available for the 2000 census should provide a

better baseline for use in budgeting and planning for the 2010 decennial

census. We performed our work in Washington, D.C., and at bureau

headquarters in Suitland, Maryland. Our work was performed from June

2001 through August 2001 in accordance with U.S. generally accepted

government auditing standards, except that we did not audit and therefore

give no assurance as to the reliability of cost information provided by the

bureau. Further details on our scope and methodology are included in

appendix I.

The estimated full-cycle cost of the 2000 decennial census of about

$6.5 billion is nearly double the $3.3 billion reported full-cycle cost of the

1990 decennial census.3

 When full-cycle cost is divided by the number of

American households, the cost per housing unit of the 2000 census was

$56 compared to $32 per housing unit for the 1990 census. The $24

increase was primarily the result of (1) $16 for expanded field data

collection methods, (2) $3 for the extensive use of technology and

contractor support, (3) $2 for more enhanced methods for data content

and products, (4) $2 for increases in marketing, communication, and

 3

The $6.5 billion estimated costs are actual obligations for fiscal years 1991 through 2000

and estimated obligations for fiscal years 2001 through 2003. We have adjusted all costs

throughout this report to constant fiscal year 2000 dollars. While this adjustment removes

the impact of changes in prices of the goods and services purchased by the bureau,

including compensation of employees, it is not designed to measure any changes in the

quality of the 2000 census results. We used the Gross Domestic Product price index to

adjust for inflation for the 1970, 1980, 1990, and 2000 censuses. For fiscal years 2001

through 2003, we deflated cost estimates to constant fiscal year 2000 dollars using factors

from the Congressional Budget Office’s Economic and Budget Outlook, January 2001.

Results in Brief
Page 3 GAO-02-31 Census Cost Per Housing Unit

partnership programs, and (5) $1 for increases in address list compilation

and other census activities. Reasons for the primary areas of cost

increases include the following.

• For the 1990 census, field data collection cost was $16 per housing unit,

while the 2000 census cost doubled to $32 per housing unit. Field data

collection, the most expensive and largest component of costs for both the

1990 and 2000 decennial censuses, is labor-intensive and includes

operations such as nonresponse follow-up, which entails temporary

workers, known as enumerators, visiting millions of American households

that did not return their census questionnaires by mail. The $16 increase

for the 2000 census occurred due to (1) expanded data collection

operations, (2) lower productivity for enumerators who conducted the

nonresponse follow-up operation, and (3) higher logistic support costs.

• In the 1990 census, technology costs were about $5 per housing unit

compared to about $8 per housing unit for the 2000 census. This $3

increase was due to the development and staffing of a new data capture

system supported by contractors for the 2000 census using new automatic

document scanning technology. This contrasted with the 1990 census, for

which bureau personnel developed and conducted data capture

technology operations in-house and hand keyed more census

questionnaire information.

• For the 1990 census, the data content and products activity cost about $3

per housing unit and, for the 2000 census, costs amounted to about $5 per

housing unit. Data content and products included the redesign of short

and long form census questionnaires and printing and postage costs for a

multiple mailing strategy. About half of the $2 increase was due to

development costs for a more user-friendly design and format for

questionnaires for the 2000 census, including questionnaires in English,

Spanish, and four other languages. For the 1990 census, questionnaires

were only available in English and Spanish. The remaining half of the

increase was due to the use of first-class postage for a multiple mailing

strategy to inform households about the census, which included a

prenotice card, the census questionnaire, and a postnotice card. For the

1990 census, a prenotice card was not used, and the census questionnaire

and the postnotice card were both mailed using third-class postage.

• The last major category of increased costs relates to marketing,

communications, and partnerships, which included census advertising and

promotion and federal partnerships with about 140,000 state, local, and

tribal governments and community groups. For the 1990 census, costs for

this area were less than $1 per housing unit, while the 2000 census costs

amounted to over $3 per housing unit. This increase was due to the bureau

using a contractor to design and conduct a professional advertising
Page 4 GAO-02-31 Census Cost Per Housing Unit

campaign for the 2000 census at a cost of about $1 per housing unit. For

the 1990 census, the bureau relied on free public service advertising. The

bureau used expanded efforts to create partnerships in the 2000 census,

adding about $1 per housing unit for the 2000 census.

In commenting on a draft of this report, the Department of Commerce,

U.S. Census Bureau, concurred with the underlying data as presented in

this report. However, the bureau expressed its concern that our report

identified cost increases without providing an appropriate explanation for

them. The objectives of this review did not include assessing the quality of

the 2000 census. As stated previously, this report is one of several we will

be issuing in the coming months on lessons learned from the 2000 census.

As was done after the 1990 census, we are currently reviewing key

operations of the 2000 census. Our response to the bureau’s specific

comments is included in appendix II.

The bureau performs large surveys and censuses that provide statistics

about the American people and the U.S. economy. The business activities

of the bureau can be divided into four categories: decennial and other

periodic census programs, demographic programs, economic programs,

and reimbursable work programs that are conducted mainly for other

federal agencies. During fiscal year 2000, the bureau conducted the actual

decennial count of U.S. population and housing as of April 1, 2000, which

is its largest and most complex activity. The results of the 2000 decennial

census are used to apportion seats in the U.S. House of Representatives,

draw congressional and state legislative districts, and form the basis for

the distribution of an estimated $200 billion annually of federal program

funds over the next decade to state and local governments.

Since the 1970 census, the bureau has used essentially the same

methodology to count the vast majority of the American population during

the decennial census. The bureau develops an address list of the nation’s

households and mails census forms (questionnaires) to those households

asking the occupants to mail back the completed forms. The bureau hires

temporary census takers, known as enumerators, by the hundreds of

thousands to gather the requested information for each nonresponding

household.4

 4

The bureau refers to this activity as “nonresponse follow-up.”

Background
Page 5 GAO-02-31 Census Cost Per Housing Unit

Over time, because of social and attitudinal changes, the public became

less willing to participate in the decennial census. By 1990, these problems

escalated to the point where the most expensive census up to that time

produced less accurate results than the preceding census. Consequently,

the bureau’s plan for the 2000 census included the above elements but also

included several important innovations to the census process designed to

improve census accuracy. For example, prior to the 2000 census, local and

tribal government officials were given expanded opportunities to review

the bureau’s address list and identify missing addresses for inclusion in the

census. The bureau also implemented the New Construction Program,

which invited local governments to submit addresses for housing units

that had been built subsequent to the completion of the address list in

January 2000. In addition, the 2000 census questionnaires were available

upon request in six languages, and households were given expanded

opportunities to respond to the 2000 census by telephone or via the

Internet. Also, for the 2000 census, the bureau initiated the largest

promotion and outreach effort in its history for a decennial census and

conducted the first-ever paid advertising campaign.

As indicated in table 1, the increase in decennial census full-cycle costs in

recent decades has been dramatic. Expressed in dollars of fiscal year 2000

purchasing power, the full-cycle costs of the decennial census rose from

$920 million for the 1970 census to a current estimate of about $6.5 billion5

for the 2000 census, for an increase of about 600-percent after adjusting

for inflation. The Gross Domestic Product (GDP) price index was used to

adjust for inflation for the 1970, 1980, 1990, and 2000 censuses, while

projections for years 2001 through 2003 were adjusted using factors from

the Congressional Budget Office’s Economic and Budget Outlook, January

2001.

 5

The $6.5 billion estimated costs are actual obligations for fiscal years 1991 through 2000

and estimated obligations for fiscal years 2001 through 2003.
Page 6 GAO-02-31 Census Cost Per Housing Unit

Table 1: Decennial Census Full-Cycle Costs and Housing Units, 1970 Through 2000

In constant fiscal year 2000 dollars

Census Period

Costs

(dollars in billions)

Housing units

(in millions)

Cost per housing unit

(in dollars)

1970 1964-1973 $0.920 70.7 $13

1980 1974-1983 2.159 90.1 24

1990 1984-1995 3.275 104.0 32

2000 1991-2003 6.553 117.3 56

Source: GAO analysis of unaudited bureau data.

Since census costs depend primarily on the expense of delivering a mail

questionnaire to a housing unit or having an enumerator visit a housing

unit, it is more realistic to relate cost growth to the rise in the number of

housing units rather to population growth. Even when housing units are

vacant and contain no household, there is a cost to ascertaining that fact.

Therefore, the number of housing units is the relevant unit to consider for

cost analysis.

A housing unit may be a house, an apartment, a mobile home, a group of

rooms, or a single room that is occupied (or, if vacant, is intended for

occupancy) as separate living quarters. Separate living quarters are those

in which the occupants live separately from any other individuals in the

building and which have direct access from outside the building or

through a common hall. For vacant units, the criteria of separateness and

direct access are applied to the intended occupants whenever possible. If

that information cannot be obtained, the criteria are applied to the

previous occupants. Both occupied and vacant housing units are included

in the housing unit inventory. Boats, recreational vehicles, vans, tents, and

the like are housing units only if they are occupied as someone’s usual

place of residence. Vacant mobile homes are included provided they are

intended for occupancy on the site where they stand. Vacant mobile

homes on dealers’ lots, at factories, or in storage yards are excluded from

the housing inventory. Also excluded from the housing inventory are

quarters being used entirely for nonresidential purposes, such as stores or

offices, or quarters used for the storage of business supplies or inventory,

machinery, or agricultural products.

The estimated full-cycle costs of the 2000 census do not take into account

all costs of the decennial census. For example, as of September 30, 2000,

about $85 million of costs for estimated claims for unemployment for

temporary workers are not included in the cost per housing unit figures in

this report. Any unemployment claims paid are absorbed by the Federal
Page 7 GAO-02-31 Census Cost Per Housing Unit

Employees Compensation Account in the Unemployment Trust Fund,

administered by the Department of Labor, without reimbursement by the

bureau.6

As shown in figure 1, the cost per housing unit in constant fiscal year 2000

dollars grew from $13 in 1970 to $56 in 2000, a 330-percent increase.

Figure 1: Decennial Census Full-Cycle Cost Per Housing Unit, Fiscal Years 1970

Through 2000 (in Constant Fiscal Year 2000 Dollars)

Source: GAO analysis of unaudited bureau data.

In constant fiscal year 2000 dollars, the estimated full-cycle cost of the

2000 decennial census of about $6.5 billion is nearly double the $3.3 billion

cost of the 1990 decennial census. When full-cycle cost is divided by the

number of American households of 117.3 million in 2000 and 104.0 million

in 1990, the cost per housing unit of the 2000 census of $56 increased 75-

percent compared to the 1990 census cost of $32 per housing unit. Table 2

shows the cost increases in eight broad “frameworks” of effort used by the

bureau in its financial management reports for the 2000 census.

 6

Annual appropriations acts have prohibited the Department of Commerce and the U.S.

Census Bureau from reimbursing the Unemployment Trust Fund for such claims, which

otherwise would be required by law. See appropriations acts covering the 2000 census

cited in 13 U.S.C. 23 note (2000).

Cost Per Housing Unit

for the 2000 Census

Increased

Significantly

13

24

32

56

0

10

20

30

40

50

60 Cost per housing unit

1970 1980 1990 2000 

Decennial census
Page 8 GAO-02-31 Census Cost Per Housing Unit

Table 2: 1990 and 2000 Decennial Census Total Cost and Cost Per Housing Unit

In constant fiscal year 2000 dollars

Framework number and description

1990 census

cost (dollars in

millions)

1990 cost per

housing unit

(dollars)

2000 census

cost (dollars in

millions)

2000 cost per

housing unit

(dollars)

1. Program Development and Management $124 $1.20 $143 $1.22

2. Data Content and Products 272 2.61 579 4.93

3. Field Data Collection and Support Systems 1,680 16.16 3,803 32.43

4. Address List Compilation 318 3.05 390 3.33

5. Automated Data Processing and

Telecommunications Support

487 4.68 877 7.48

6. Testing, Evaluation, and Dress Rehearsal 246 2.37 288 2.45

7. Puerto Rico, Virgin Islands, and Pacific Areas 57 0.55 99 0.84

8. Census Marketing, Communication, and

Partnerships

91 0.88 374 3.19

Total $3,275 $31.50 $6,553 $55.87

Note: Table 2 information is presented according to the framework structure used in the 2000 census.

The 1990 census information was originally presented in 13 frameworks. We requested and the

bureau provided reclassified cost data on the 1990 census in these eight frameworks to facilitate

comparisons between the 1990 and 2000 censuses.

Source: GAO analysis of unaudited bureau data.

The $24 cost per housing unit increase was primarily the result of

increased costs in four of the eight frameworks: (1) $16 for expanded field

data collection methods, (2) $3 for the extensive use of technology and

contractor support, referred to as automated data processing and

telecommunications support, (3) $2 for more enhanced methods for data

content and products, and (4) $2 for increases in marketing,

communication, and partnership programs. Finally, other areas such as

the compilation of a complete and accurate address list and the testing of

the census design contributed the remaining $1 of the $24 increase in the

2000 census compared to the 1990 census.

Framework 3, Field Data Collection and Support Systems, was the most

expensive and the largest component of census costs, contributing about

$16 or two-thirds of the $24 increase in per housing unit cost of the 2000

census. Field data collection is labor-intensive and includes operations

such as nonresponse follow-up, which entails temporary workers, known

as enumerators, visiting millions of households that did not return census

questionnaires by mail or otherwise respond. As indicated in table 2, the

cost for this framework for the 1990 census was about $1.7 billion, which

accounted for half of the total $32 per housing unit cost. However, for the

2000 census, costs for this framework more than doubled to about

Field Data Collection Was

the Largest Increase in

Costs
Page 9 GAO-02-31 Census Cost Per Housing Unit

$3.8 billion or $32 of the total $56 per housing unit cost. The $16 increase

for the 2000 census occurred due to (1) expanded data collection

operations, (2) lower productivity for enumerators who conducted the

nonresponse follow-up operation, and (3) higher logistic support costs.

First, according to the bureau, expanded data collection operations

contributed about $14 of the $16 increase in field data collection costs. For

example, for the 2000 census, the bureau expanded coverage improvement

programs, which were designed to improve census coverage and accuracy.

For the 2000 census, the coverage improvement program included for the

first time the enumeration of addresses from the update/leave operation

and new construction follow-up. Also, another example of expanded

operations for the 2000 census was the telephone questionnaire assistance

center. For the 1990 census, the telephone questionnaire assistance was

conducted by bureau staff members, who handled over 2 million calls and

worked in six processing centers. For the 2000 census, the telephone

questionnaire assistance center was operated by contractors, who handled

about 6 million calls and operated from 22 nationwide call centers. We

could not analyze each data collection operation and compare the 2000

census to the 1990 census, except for the nonresponse follow-up operation

discussed below, due to incomplete or missing cost and performance data

for the 1990 census.

Second, lower enumerator productivity for the nonresponse follow-up

operation in the 2000 census compared to the 1990 census contributed

about $1 of the $16 increase in costs in the field data collection area.

According to the bureau, enumerator productivity to visit nonresponding

households and complete questionnaires in the 1990 census was 1.56 cases

per hour but dropped by one-third to 1.04 cases per hour in the 2000

census. Productivity is calculated by dividing the total workload (the

number of housing units) by the total number of production hours worked.

For the 1990 census, the bureau had a workload of over 39 million

nonresponding housing units as compared to a workload of about 42

million nonresponding housing units in the 2000 census for a 7-percent

increase. About 25 million production hours for the 1990 census increased

to about 40 million production hours for the 2000 census for a 60-percent

increase. However, according to the bureau officials, the higher

production hours for the 2000 census were due to more quality assurance

procedures, such as crew leader edits and enhanced office checks, plus

more re-interview checks. Information on enumerator productivity rates

by type of local census office, the bureau’s methodology for refining the

productivity data, and factors that could improve the collection and
Page 10 GAO-02-31 Census Cost Per Housing Unit

analysis of productivity data in the future are highlighted in our October

report.7

Third, higher logistical support costs for increases in the number and size

of local census offices, increases in equipment, and increases in temporary

support office workers in the 2000 census compared to the 1990 census

contributed less than $1 of the $16 increase in the field data collection

area. For the 1990 census, there were 458 district offices, which were

increased by 62 to a total of 520 local census offices for the 2000 census.

According to the bureau, the additional 62 local census offices were

necessary to support the increase in workload for the 2000 census. This

14-percent increase in the number of offices resulted in cost increases for

items such as space rental, utilities, equipment, and supply costs. Also,

according to the bureau, the local census offices in 2000 were larger with

more equipment, such as mapping equipment and telecommunications,

when compared to those in 1990. In addition, the bureau asserts that the

2000 census had a higher number of temporary office workers in the local

census offices that were used to support all activities of the 2000 census,

such as address list development. Again, we were unable to independently

analyze the bureau assertions due to the lack of or incomplete cost data

for the 1990 census.

Framework 5, Automated Data Processing and Telecommunications

Support, was the second largest category of costs for both the 1990 and

the 2000 censuses and contributed about $3 of the $24 per housing unit

cost increase for the 2000 census. As indicated in table 2, the cost for this

framework for the 1990 census was about $487 million or almost $5 of the

total $32 per housing unit cost. However, for the 2000 census, the cost for

this framework increased about 80-percent to $877 million or about $8 of

the total $56 per housing unit cost. This $3 increase was due to the

development and staffing of a new data capture system for the 2000 census

using new automatic document scanning technology, which was

supported by contractors. This contrasted with the 1990 census, for which

bureau personnel developed and conducted data capture technology

operations in-house and hand keyed more census questionnaire

information.

 7

2000 Census: Better Productivity Data Needed for Future Planning and Budgeting

(GAO-02-4, October 4, 2001).

Automated Data

Processing and

Telecommunications

Support
Page 11 GAO-02-31 Census Cost Per Housing Unit

During the 1990 census, the bureau developed and built a data capture

system in-house called FACT90. This system consisted of high-speed

cameras to film each form, microfilm processors to develop and process

the film, and a film optical sensing device to capture check box responses

from the forms for computer input. Computer terminals were used to enter

all handwritten data from the paper forms. Automation was limited to the

multiple-choice questions and the bureau keyed 100-percent of the

reported write-in fields. Also, name keying was limited primarily to multiunit surnames for person number one on the questionnaire. Although the

bureau had seven data capture centers in 1990, final data capture

processing was not completed until September 1991.

For the 2000 decennial census, the bureau relied extensively on

contractors to develop a data capture system that used the latest

commercial technology, incorporated a number of internal controls to

improve the accuracy of data processed, and was more timely in

completing census operations. The bureau did not have the expertise to

develop the complex new technology in-house. The technology included

automated equipment to sort questionnaires by categories and optical

character recognition readers to scan approximately 75-percent of

handwritten questions without need for further human intervention. In

addition, optical mark recognition equipment captured 100-percent of the

check box questions on both the long and short form questionnaires.

Internal controls included manual review of a small number of data fields

that contained multiple responses for accuracy as part of the keying

operation before data were transmitted for processing. In addition,

response data were verified and a file was returned to check

questionnaires using a positive checkout system, and there was 100-

percent full name keying of all persons in the household to assist the

bureau in a review for duplicate counts. The four data capture centers

with the new technology allowed for the processing of census data to be

completed by the end of 2000.

Framework 2, Data Content and Products, was the third largest category

of costs for the 2000 census and contributed over $2 of the $24 per housing

unit cost increase for the 2000 census. This area included questionnaire

design of long and short forms, a multiple mailing strategy, and printing

and postage costs. As indicated in table 2, the cost for this framework for

the 1990 census was about $272 million, or less than $3 of the total $32 per

housing unit cost. However, for the 2000 census, costs for this framework

more than doubled to $579 million, or almost $5 of the total $56 per

housing unit cost. The $2 cost increase of the 2000 census was due to the

Data Content and Products

Increased Costs
Page 12 GAO-02-31 Census Cost Per Housing Unit

design of a more user-friendly questionnaire, the availability of a census

questionnaire in other languages, a multiple mailing strategy with higher

printing and postage costs, and the development of a new data retrieval

system to disseminate census 2000 data.

For the 1990 census, questionnaires were “computer-friendly” to assist the

bureau in processing the forms more easily, but some households found

them difficult to understand and complete. For the 2000 census, the

bureau contracted with commercial designers to produce questionnaires

that were simpler and easier to fill out or “respondent-friendly,” thus

making them more likely to be completed and returned. Questionnaires for

the 1990 census were only available in English and Spanish, while for the

2000 census, questionnaires were also available in Chinese, Korean,

Vietnamese, and Tagalog. The availability of the additional language forms

in 2000 and the redesign of the census questionnaire also increased

printing costs over the 1990 census.

In addition, for the 1990 census, the bureau mailed the census

questionnaires and a postnotice card. For the 2000 census, the bureau

developed a multiple mail strategy to inform households about the census.

First, a prenotice card was sent out to alert households of the census and

its benefits with an offer to send a questionnaire in languages other than

English upon request. The census questionnaire then was mailed noting

that “responses were required by law.” Finally, a postnotice card was sent

to households thanking those who participated and reminding others to

complete the forms if they had not already done so. For the 1990 census,

about 180 million items were printed using third-class postage on all

mailings at a cost of about $17 million. For the 2000 census, printing

volume almost doubled to about 340 million items, including additional

language forms, and all mailings used first-class postage at a cost of about

$117 million.

Also, according to the bureau, for the 1990 census, data was disseminated

using CD-ROM and printed copy. For the 2000 census, the bureau

expanded its efforts through a new data retrieval system called the

American FactFinder to disseminate census data. This system is available

to the widest possible array of users through the Internet, Intranets, and all

available intermediaries, including the nearly 1,800 State Data Centers and

affiliates; the 1,400 Federal Depository libraries; and other libraries,

universities, and private organizations.
Page 13 GAO-02-31 Census Cost Per Housing Unit

Framework 8, Marketing, Communication, and Partnerships, was the

fourth largest category of increased cost for the 2000 census, and this area

contributed about $2 of the $24 per housing unit cost increase for the 2000

census. This area included costs for advertising and promotion and

partnerships with state, local, and tribal governments, as well as

community groups. As indicated in table 2, the cost for this framework for

the 1990 census was about $91 million, or less than $1 of the total $32 per

housing unit cost. However, for the 2000 census, costs for this framework

quadrupled to $374 million, or over $3 of the total $56 per housing unit

cost. The $2 cost increase for the 2000 census was the result of expanded

efforts to promote a higher level of responsiveness,8

 particularly for those

segments of the population traditionally most difficult to enumerate. These

efforts included a paid advertising campaign and the involvement of

community partnerships.

For the 1990 census, the bureau marketing effort was limited and it was

considerably expanded for the 2000 census. This included a multifaceted

effort to remind the general population about the census, educate

members of the public who did not understand the purpose of the census

and its significance to their communities, and motivate Americans to

complete their census questionnaires. The main components of the

bureau’s Partnership and Marketing Program for the 2000 census were the

following.

• The bureau used its first-ever paid advertising campaign to generate

awareness about the 2000 census via print, broadcast, and out-of-home

advertising. For the 1990 census, an advertising campaign was conducted

with free advertising of the Ad Council, a nonprofit organization

responsible for administering public service advertising campaigns. Since

the advertising was free to fill available air space, the bureau had no

control over the time of day that its advertising was broadcast, which

included many early morning hours to very small viewing audiences. For

the 2000 decennial census, the bureau expanded its marketing program to

a national audience during prime viewing times and hired a contractor to

 8

The bureau achieved an initial mail response rate of about 64 percent, 3 percentage points

higher than it had anticipated when planning for nonresponse follow-up. However, initial

bureau data on the postcensus mail return rate—which is a more precise indicator of

public cooperation—was 72 percent, a decline of 2 percentage points from the 74-percent

mail return rate the bureau achieved in 1990. (The bureau’s figures are preliminary and

subject to verification upon receipt of final data.) See 2000 Census: Better Productivity

Data Needed for Future Planning and Budgeting (GAO-02-4, October 4, 2001).

Marketing,

Communication, and

Partnerships Increased

Costs
Page 14 GAO-02-31 Census Cost Per Housing Unit

design and conduct a professional advertising campaign at a cost of about

$1 per housing unit.

• The bureau established partnerships with businesses, nongovernmental

organizations, and government entities to help deliver the census message

and obtain a more complete and accurate population count. This activity

was considered important because local organizations knew their

conditions and circumstances better than the bureau. This effort resulted

in bureau partnerships with about 140,000 state, local, and tribal

governments and community groups that added about $1 to the per

housing unit cost to the 2000 census. A recent GAO report contains further

information and best practices on the bureau’s partnership program.9

The remaining frameworks 1, 4, 6, and 7 contributed the remaining $1 of

the $24 per housing unit cost increase for the 2000 census when compared

to the 1990 census. As indicated in table 2, the costs for these four

frameworks for the 1990 census totaled about $745 million or about $7 of

the total $32 per housing unit cost. For the 2000 census, costs for these

four frameworks increased about 23-percent to about $920 million or

about $8 of the total $56 per housing unit cost. The $1 cost increase for the

2000 census was due to increased bureau efforts to compile a complete

and accurate address list and to plan, evaluate, and test aspects of the

census design, including dress rehearsals.

In commenting on a draft of this report, the Department of Commerce,

U.S. Census Bureau, concurred with the underlying data as presented in

this report and provided its perspective on four matters, which we address

below.

First, the bureau stated repeatedly that Census 2000 was enormously

successful and it was disappointed we made no effort to assess the costs

of the 2000 census with respect to the high quality of the data produced in

the face of significant challenges. In this regard, the objectives of this

review did not include assessing the quality of the 2000 census. Our

objectives were to (1) update full-cycle costs to reflect the most current

information and (2) analyze bureau data to determine the causes of the

significant increase in cost per housing unit for the 2000 census when

 9

2000 Census: Review of Partnership Program Highlights Best Practices for Future

Operations (GAO-01-579, August 20, 2001).

Other Framework Costs

Agency Comments

and Our Evaluation
Page 15 GAO-02-31 Census Cost Per Housing Unit

compared to the cost for the 1990 census. Further, the bureau is still

assessing the quality of the 2000 census in its postenumeration review

through fiscal year 2003. As stated in the introduction to this report, this

product is one of several we will be issuing in the coming months on

lessons learned from the 2000 census. As was done after the 1990 census,

we are currently reviewing key operations of the 2000 census.

Second, the bureau stated that we reported the cost increases without

providing appropriate explanation for them. We disagree. Throughout this

review, we repeatedly asked the bureau for explanations and supporting

documentation for the reasons for the cost increases. To the extent data

and explanations were provided for the cost increases, we discussed them

in this report. However, in many instances, particularly with respect to the

1990 census, the bureau was unable to provide us explanations or

documentation at the activity and project level. Our report clearly states

that cost information provided by the bureau for the 1990 census was

limited.

Third, the bureau pointed out that any analysis of cost increases must take

into account the fact that the bureau was asked to develop, and to begin to

implement, two different operational designs. Our September 1999 report10

provided information on the Supreme Court decision that prohibited the

bureau from carrying out its plans to use statistical methods. As

mentioned in that report, the bureau did not begin detailed budgeting for a

nonsampling-based census until after the Supreme Court ruling in January

1999. Our work associated with this review showed that the majority of

the cost increases for the 2000 census were not in the planning of two

operational designs but in the execution of the traditional census.

Specifically, we found no evidence that the bureau’s planning for a “dualtrack” census was a significant driver of cost increases of the 2000 census

compared to the 1990 census.

Finally, the bureau noted that it was not appropriate to discuss the cost

increases without acknowledging the substantial achievement in

developing and implementing extensive new census operations. As stated

previously, the objectives of this review did not include evaluating the

quality of new programs implemented as part of Census 2000. Throughout

the report, we mentioned several important innovations to the census

 102000 Census: Analysis of Fiscal Year 2000 Amended Budget Request

(GAO/AIMD/GGD-99-291, September 22, 1999).
Page 16 GAO-02-31 Census Cost Per Housing Unit

process and related costs, including expanded partnership agreements, the

New Construction program, the availability of the census questionnaire in

multiple languages, and expanded mass media efforts including the firstever paid advertising campaign. Also, we have a separate effort under way

to analyze variances from the bureau’s fiscal year 2000 budget and the

reasons that certain obligations and expenditures were different than

planned.

The complete text of the response to our draft report from the Department

of Commerce, U.S. Census Bureau, is presented in appendix II.

We are sending copies of this report to the Chairman and Ranking

Minority Member, Senate Committee on Governmental Affairs, and the

Chairman and Ranking Minority Member, House Committee on

Government Reform and Oversight. We are also sending copies to the

Acting Director of the U.S. Census Bureau, the Secretary of Commerce,

the Director of the Office of Management and Budget, the Secretary of the

Treasury, and other interested parties. This report will also be available on

GAO’s home page at http://www.gao.gov.

If you or your staffs have any questions on this report, please contact me

at (202) 512-9095 or by e-mail at kutzg@gao.gov or Roger R. Stoltz,

Assistant Director, at (202) 512-9408 or by e-mail at stoltzr@gao.gov. Key

contributors to this report were Cindy Brown Barnes and Linda Brigham.

Gregory D. Kutz

Director

Financial Management and Assurance
Appendix I: Objectives, Scope, and

Methodology

Page 17 GAO-02-31 Census Cost Per Housing Unit

The objectives of this report were to (1) update full-cycle costs and

(2) analyze bureau data to determine the causes of the significant increase

in cost per housing unit for the 2000 census when compared to the cost for

the 1990 census. We did not assess the quality of the 2000 census in this

report. To fulfill these objectives, we obtained and analyzed financial data

from the U.S. Census Bureau to develop full-cycle costs of the 1970, 1980,

1990, and 2000 decennial censuses and converted all amounts to constant

fiscal year 2000 dollars1 in order to eliminate the effects of inflation over

time. We then identified components of full-cycle costs to the extent the

bureau was able to provide the data and calculated cost per housing unit.

For the 2000 census, we obtained cost and full-time equivalent

employment information for budget and actual data from unaudited

bureau financial management reports. This information was available in

eight broad “frameworks” of effort that the bureau further divided into 23

activities and, within these activities, further divided into 119 projects.

However, the 1990 census information was originally presented in 13

frameworks. We requested and the bureau provided reclassified cost data

on the 1990 census in these eight frameworks to help facilitate

comparisons between the 1990 and 2000 censuses.

For the 1990 census, the bureau provided very limited cost data by activity

and project, so we decided not to attempt detailed cost comparisons at

that level of detail. We therefore focused on identifying activities or

projects for the 2000 census that, according to the bureau, either did not

exist or had very low costs in the 1990 census. We also used other bureau

information, such as pay rates, employment statistics, and the number of

temporary offices, to supplement our analysis as needed.

We conducted interviews with senior bureau officials and others who

provided us with oral and written evidence. This included an overview of

2000 census operations with comparisons to 1990 census operations,

reasons for the increase in the cost per housing unit, and cost studies and

analyses from the bureau and other independent organizations. We

reviewed and analyzed this information as well as our past reports on

decennial census operations.

 1

We used the GDP price index, an economywide measure, to adjust for inflation for the

1970, 1980, 1990, and 2000 decennial censuses. For fiscal years 2001 through 2003, we

deflated cost estimates to constant fiscal year 2000 dollars using factors from the

Congressional Budget Office’s Economic and Budget Outlook, January 2001.

Appendix I: Objectives, Scope, and

Methodology
Appendix I: Objectives, Scope, and

Methodology

Page 18 GAO-02-31 Census Cost Per Housing Unit

We performed our work in Washington, D.C., and at bureau headquarters

in Suitland, Maryland. Our work was performed from June through August

2001 in accordance with U.S. generally accepted government auditing

standards, except that we did not audit and therefore give no assurance as

to the reliability of cost information provided by the bureau.

On November 7, 2001, we received comments from the Department of

Commerce, U.S. Census Bureau, on a draft of this report. The bureau’s

comments are discussed in the “Agency Comments and Our Evaluation”

section and are reprinted in appendix II.
Appendix II: Comments From the Department

of Commerce, U.S. Census Bureau

Page 19 GAO-02-31 Census Cost Per Housing Unit

Appendix II: Comments From the

Department of Commerce, U.S. Census

Bureau
Appendix II: Comments From the Department

of Commerce, U.S. Census Bureau

Page 20 GAO-02-31 Census Cost Per Housing Unit

See comment 1.

See comment 2.

See comment 1.

See comment 1.
Appendix II: Comments From the Department

of Commerce, U.S. Census Bureau

Page 21 GAO-02-31 Census Cost Per Housing Unit

See comment 3.

See comment 1.
Appendix II: Comments From the Department

of Commerce, U.S. Census Bureau

Page 22 GAO-02-31 Census Cost Per Housing Unit

See comment 5.

See comment 4.
Appendix II: Comments From the Department

of Commerce, U.S. Census Bureau

Page 23 GAO-02-31 Census Cost Per Housing Unit

See comment 6.

See comment 5.
Appendix II: Comments From the Department

of Commerce, U.S. Census Bureau

Page 24 GAO-02-31 Census Cost Per Housing Unit

The following are GAO’s comments on the letter dated November 7, 2001,

from the Department of Commerce, U.S. Census Bureau.

1. See the “Agency Comments and Our Evaluation” section of this report.

2. The full-cycle cost of the 2000 census was nearly double the full-cycle

cost of the 1990 census. On a cost-per-housing-unit basis, the increase

was 75 percent, which is accurately stated in the text of our report. We

have modified the heading referred to in the bureau’s comments to

reflect that the 75-percent increase was significant. Also, we disagree

with the bureau’s assertion that the increased cost per housing unit

observed in the 2000 census must be discussed in the context of the

bureau’s ability to reverse a decades-long trend in declining response

rates, which reflects an increase in cooperation from the public. We

have modified the report to reflect that preliminary data on the

postcensus mail return rate, a more precise indicator of public

cooperation than the initial mail response rate, declined from 74

percent for the 1990 census to 72 percent for the 2000 census.

3. The changes in field operation staffing described by the bureau in its

comments on field data collection activities for the 2000 census, as

well as other changes, may have had a significant impact on the quality

of the 2000 census results. However, as stated in our report, we did not

assess the quality of the 2000 census. Also, we did not have sufficient

information to adjust the cost per housing unit in the 2000 census for

such changes in quality. In addition, as stated in footnote 3, we

adjusted all costs in the report to constant fiscal year 2000 dollars

using the Gross Domestic Product price index. This index reflects

changes in the compensation paid to all federal workers, which

increased from 1990 to 2000 at about the same rate as the wages paid

for field operation staff. Thus, these wage increases cannot be viewed

as a major reason for the increase in the cost per housing unit for the

2000 census.

4. Our report does not imply that much of the increased costs attributed

to the bureau’s technological innovations occurred because of

increased reliance on private contractors. Further, the scope of our

work did not include determining whether the use of contractors was

appropriate for these activities. We reiterate that this report responds

to our congressional clients’ request for information on the costs of the

2000 census and does not and was not intended to provide qualitative

information on the results of the census. We are not suggesting that the

GAO Comments
Appendix II: Comments From the Department

of Commerce, U.S. Census Bureau

Page 25 GAO-02-31 Census Cost Per Housing Unit

bureau refrain from using external contractors to assist in exploring

the possibility of expanding software development activities to inhouse operations, particularly as these activities become more

complex. The concern discussed in our October 2000 report1

 was the

lack of effective and mature software and system development

processes, not whether such activities were done by contractors or inhouse.

5. This report provided information on the significant cost drivers for the

2000 census as compared to the 1990 census, in accordance with our

requesters’ needs. As stated in the “Agency Comments and Our

Evaluation” section of this report, we are conducting a review of key

operations of the 2000 census. Thus, the scope of this report did not

include an assessment of the effect of the redesign of the questionnaire

and the availability of questionnaires and language assistance guides in

many languages. Likewise, while the report refers to the increased cost

of marketing, communication, and partnership programs, the link

between response rates and these programs was not within the scope

of our review.

6. We agree that estimates for worker’s compensation claims and

litigation are included in the $6.5 billion of full-cycle cost to the extent

that these costs are reflected in the fiscal year 2002 and 2003 budgets

and have modified the report accordingly.

 1

2000 Census: Headquarters Processing System Status and Risks (GAO-01-1, October 17,

2000).

(192033)
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