In the mid-1990s, the U.S. Bureau of the Census (Census Bureau) began developing and testing a new means of data collection called a "rolling sample" or "continuous measurement" survey that became the American Community Survey (ACS). Implemented nationwide in 2005 and 2006, the ACS currently collects data from a representative sample of about 295,000 housing units a month, totaling about 3.54 million a year (an increase from the 2005 to 2011 sample size of approximately 250,000 housing units monthly, totaling about 3 million annually). The data are aggregated over time to produce large enough samples for reliable estimates, with longer cumulations of data necessary in less populous areas. The Bureau issues one-year estimates for the most populous areas, those with at least 65,000 people; three-year estimates for areas with 20,000 or more people; and five-year estimates for areas from the most populous to those having fewer than 20,000 residents. Although conducted separately from the once-a-decade count of the whole U.S. population, the ACS is considered a part of the decennial census program because it replaced the census long form, which covered a representative sample of housing units every 10 years from 1940 through 2000. In the 2000 census, a set of basic questions on a short form went to most housing units; a sample of units—about 17% overall—received a long form containing the short-form questions and additional questions that collected detailed data on socioeconomic and housing characteristics. The data served myriad governmental, business, and research purposes and were used in program formulas that determined the annual allocation of various federal funds to states and localities. ACS data, which serve the same purposes but are much more current than the long-form estimates were, are used to distribute more than $450 billion a year in funding. Thus, the timeliness and quality of ACS data are important for many reasons, but especially to promote the equitable allocation of scarce public resources. Discussing in 2001 how the ACS evolved, the late Charles H. Alexander of the Census Bureau recalled that in the early 1990s [t]here was renewed Congressional interest in intercensal characteristics data ... and a "continuous measurement" alternative to the census long form was considered as part of the research for Census 2000, starting in 1992. [The] rolling sample design was eventually proposed for this purpose because it provided flexibility in making estimates, as well as the potential for efficient data collection.... "Continuous Measurement" was later renamed the "American Community Survey.... " The proposed ACS was not adopted for Census 2000, but after limited testing during 1996-1998, the ACS methodology was implemented in 36 counties for the years 1999-2001, so that ACS results could be compared to the 2000 census long form data. There was also a large-scale test in 2000, for a state-representative annual sample ... called the Census 2000 Supplementary Survey, of collecting long-form data separately from the census, using the ACS questionnaire. He explained that [f]or the main ACS objective, to replace the census long form as a source of detailed descriptive statistics, we plan to use 5-year ACS cumulations, for a data product similar to traditional long form "summary files". This is the shortest time period for which the ACS sampling error is judged to be reasonably close to that of the census long form. All sizes and types of geographic areas would be included on these 5-year data files.... For individual areas, the most prominently published data will be one-year averages for areas greater than 65,000 population, and 3-year averages for areas greater than 20,000, in addition to the 5-year averages for all areas. The Census Bureau had two main reasons for replacing the long form with the ACS. First was the intention to increase public acceptance of, and response to, the decennial enumeration by decoupling the count of the whole population from the sample-survey part of the census. The Bureau strives, never entirely successfully, to achieve a complete count because it is a constitutional requirement for apportioning seats in the U.S. House of Representatives, and because the data serve many other important national, state, and local purposes. According to a 2008 Government Accountability Office (GAO) report on the projected mail response rate of 69% for the 2010 census, the Bureau calculated that eliminating the long form and moving to a short-form-only census would add one percentage point to the 2000 census initial mail return rate of 65%. The second reason for adopting the ACS was to produce more timely information, which was particularly needed in program formulas used to distribute certain federal funds to states and localities. Detailed socioeconomic and housing data not only were collected just once a decade on the long form, but also were up to three years old by the time the Bureau processed and released them. In 1976, Congress authorized, but did not fund, a mid-decade census that would have provided more current data. The ACS could be viewed as substituting for the never-implemented mid-decade census as well as the long form. Before the ACS became fully operational, in 2005 and 2006, it underwent extensive development and testing, which began in the mid-1990s. The steps that led to full implementation are discussed briefly below. The Bureau's ACS designers decided, while developing a prototype of the survey, that it would have several features in common with the decennial census: survey questionnaires would be mailed to housing units, and completed questionnaires would be returned by mail; responses would be mandatory; and the Bureau would follow up, by telephone and, as necessary, in-person visits, with households that did not fill out and return their questionnaires. Unlike the census, however, the ACS would collect data continuously from independent monthly samples of the population and would aggregate the data over time to produce estimates that would be controlled to population and housing estimates. The designers "initially suggested" an ACS sample size of 500,000 housing units per month, but rejected it as prohibitively expensive and "determined that a monthly sample size of 250,000 would generate an acceptable level of reliability." Limited testing of ACS operations began in 1995 in Rockland County, New York; Brevard County, Florida; Multnomah County, Oregon; and Fulton County, Pennsylvania. In 1996, the Bureau extended testing to areas with varied geographic and demographic characteristics, including Harris County, Texas; Fort Bend County, Texas; Douglas County, Nebraska; Franklin County, Ohio; and Otero County, New Mexico. This testing led to further research into small-area estimation, estimation methods, nonresponse follow-up, weighting in ACS tests, item nonresponse, response rates, and the quality of data for rural areas. In 1998, operational testing expanded to Kershaw County, South Carolina; Richland County, South Carolina; and Broward County (which the Bureau substituted for Brevard County), Florida. Adding the two South Carolina counties enabled the Bureau to compare ACS test data with results from the 1998 dress rehearsal for the 2000 census, which included these counties. Testing was extended in 1999 to 36 counties in 26 states, "selected to represent different combinations of county population size, difficulty of enumeration, and 1990-1995 population growth," as well as "racial and ethnic diversity, migrant or seasonal populations, American Indian reservations, changing economic conditions, and predominant occupation or industry types." In addition, during 1999 and 2001, the 36 counties were test sites for enumerating residents of group quarters (GQs), such as college residence halls, residential treatment centers, skilled nursing facilities, group homes, military barracks, correctional facilities, and workers' dormitories; and facilities for homeless people. These tests, which concentrated on the methodology for visiting group quarters, selecting samples of residents, and conducting interviews, "led to modification of sampling techniques and revisions to data collection methods." Although the primary objective of this testing phase "was to determine the viability of the methodologies utilized, it also generated usable data." Data were released in 1999 on "demographic, social, economic, and housing topics." In 2000, the Bureau undertook a larger-scale test, or demonstration, originally called the "Census 2000 Supplementary Survey," to "assure Congress and other data users" that nationwide implementation of the ACS was feasible and that the rolling sample survey could produce information comparable in quality and reliability to long-form data. The demonstration was conducted in 1,239 of the nation's 3,141 counties, the 36 ACS test counties and 1,203 newly added counties. The number of housing units sampled annually increased from 165,000 in 1999 to 866,000 in 2000. From 2001 through 2004, the Bureau issued 11 reports analyzing various aspects of the demonstration phase. Overall, according to this analysis, the demonstration showed the ACS to be a success and supported proceeding with it, but with certain refinements. The demonstration's "planned tasks were completed on time and within budget, and the data collected met basic Census Bureau quality standards." The ACS "was well-managed, was achieving the desired response rates, and had functional quality control procedures." The ACS and census 2000 long-form estimates of economic characteristics were comparable. The same was true of social characteristics, except for the estimates of disability and ancestry. The analysis recommended further research concerning these discrepancies, and other research to reduce variance in ACS estimates below the county level of geography. Moreover, the analysis found that although the "ACS methodology was sound, its improvement needed to be an ongoing activity." At congressional direction, part of the demonstration involved a test of voluntary versus mandatory compliance with the ACS. The test and its results, which have implications for ACS response rates, survey costs, and data reliability, are discussed later in this report. Full implementation of the housing unit component of the ACS occurred in January 2005, with the survey's expansion to all 3,141 U.S. counties and coverage of approximately 250,000 housing units per month, for a total of about 3 million a year.