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Poorest place in US? McAllen, Texas, and here's why

It's a top 10 list no one wants to be on: a new Census brief named the McAllen, Texas, metro area the poorest in the nation.

Roughly a third of the residents in this Mexican border area in the Rio Grande Valley live below the poverty line, in spite of a healthcare industry that continued to add jobs during the recession and a retail sector buoyed by Mexican shoppers who cross the border to buy American name-brand clothes.

The poor have migrated from urban centers and into the sprawling suburbs, which makes McAllen and its surrounding environs a textbook example of how poverty is evolving in America. The geographic dispersion of not only citizens but the jobs that could reverse their financial misfortunes vexes policymakers and challenges an already strained social services safety net.

Poverty used to be an urban scourge, but no more. A report released last month flagged the rust belt city of Reading, Pa., as the poorest in the nation, but neither its 88,000 residents nor surrounding population density are large enough for inclusion in the new research, which looks at metro areas of half a million people or more. If Reading is the traditional face of poverty, greater McAllen,  with a population of 741,000, is the 21st-century version.

The rate of poverty in the suburbs grew by 53 percent over the past decade, twice as fast as it did in cities, according to Elizabeth Kneebone, senior research associate at the Brookings Institution's Metropolitan Policy Program.

The McAllen-Edinburg-Mission Metropolitan Statistical Area had a poverty rate of 44.4 percent among foreign-born, suburban-dwelling residents in 2009. It's worth noting that this figure actually dropped by 5.7 percentage points from a decade earlier, but the total is still high enough to push greater McAllen's overall poverty rate past other struggling population centers like Fresno and El Paso (Nos. 2 and 3 on the Census list, with poverty rates around 25 percent, compared with 33 percent for McAllen).

A paper published in August by the Brookings Metropolitan Policy Program notes that McAllen is one of a handful of metro areas "in states along the southwestern border which have received a large influx of poor Mexican immigrants." Elsewhere, the paper suggests that the settlement patterns of these new arrivals — who establish residency in the suburbs rather than urban centers — contribute to growth of poverty in these outlying areas rather than in cities.

McAllen policymakers say a lack of education is another hurdle to prosperity. "Only 62 percent of people in the metro area are graduating from high school," says Teclo Garcia, government affairs director for the city of McAllen. "The county has… a lot of immigrants to the county that are new, are underachieving in the education areas," he said.

The local school district just launched an initiative to distribute iPads to 25,000 students to make its future workforce more attractive to employers. "We're trying to start moving even the poor students to be technology ready," Garcia said.

Poor people — whether foreign or native-born — who live in suburbs face a distinct set of challenges. "The safety net has typically been more robust and more built-up in urban communities," said Kneebone. "The suburban safety net is stretched much thinner."

This is the case in greater McAllen, where the city contributes to programs that offer job-training, healthcare and housing assistance to low-income residents elsewhere in the county. 

Kneebone says the lack of public transit in outlying municipalities makes it hard for poor people to access these services, even when they are available. Applying for food stamps, for instance, or visiting a doctor that accepts Medicaid might entail a time-consuming, expensive bus ride.

Although providing social services to a far-flung population is hard, furnishing them with jobs that can lift them out of poverty is even harder. "The best way out of poverty is a job, but you need to be able to connect to those job opportunities in the first place," Kneebone said. Since people living below the poverty line may not have money for a reliable car, jobs either need to be located near where they live or be accessible via public transportation.

For McAllen, this means its Economic Development Corporation sometimes helps companies establish a business presence outside its borders. "We help locate literally tens of thousands of jobs outside our city limits," Garcia said. "If it doesn't work out and a nearby city does, we work to locate them there. We think that's still more valuable than letting them go to another region, or another country."

Click below for a report on Reading, Pa., America's most poverty-stricken small city:

U.S. Census shows Reading, Pa., is America's most poverty stricken city. WCUA's Stacey Stauffer reports.