States Struggle to Help Poor Pay Winter Heating Bills

 

Temperatures are dropping and fuel prices are rising, causing states to worry that they won't have enough money to help low-income residents keep their houses warm this winter.

Even before the onset of the harshest winter weather, energy assistance officials in a number of states already are reporting record numbers of people seeking help to pay for their heating bills. States complain that Congress' increase in energy-assistance funds from $1.89 billion in 2004 to $2.18 billion in 2005 isn't enough to meet needs.

An analysis by Richard Kogan at the Center on Budget and Policy Priorities, which focuses on public policies that impact low-income people, found that despite extra federal money, states will have $164 million less than needed to cover an expected 24 percent leap in home heating costs. Adjusting for fuel prices, Kogan said that the 2005 level of funding is the lowest in five years.

In 2004, nearly 5 million households applied for heating assistance through the federally funded and state-administered Low-Income Home Energy Assistance Program (LIHEAP). An initial sampling of states shows that requests for home heating aid could reach an all-time high in 2005, according to Mark Wolfe, executive director of the National Energy Assistance Directors' Association in Washington, D.C.

For example, application requests are up 50 percent in Wisconsin from the same time last year, 22.4 percent in Montana, 33 percent in South Carolina, and 15 percent in Rhode Island, Wolfe said. Nationally, he said he expects the number of households needing assistance to increase 5 percent to 10 percent.

To make do, states have taken a variety of tacks, from scaling back benefit levels to pitching in some of their own money to subsidizing their low-income heating programs through mandatory surcharges on utility bills.

  • Colorado pared back how much money they'll give to eligible families, whose incomes typically hover near the federal poverty line. Recipients will get $220 to help with heating bills this winter. That's $100 less than in 2004. "We serve everyone who comes in the door, and we lower the benefit levels so we can at least provide some assistance to everyone who needs it. It's not like we're going to shut the program and deny people assistance. But the levels of assistance are going to be much lower, and it won't stretch as far," said Glenn Cooper, manager of Colorado's program
  • Montana Gov.-elect Brian Schweitzer (D) told state utility regulators Nov. 30 that he intends to make low-income heating assistance a budget priority next year, according to the Billings Gazette. In Wisconsin, where Democratic Gov. Jim Doyle opened LIHEAP enrollment a month early in anticipation of increased need, the state is kicking in $18.5 million to help keep Badger State residents warm. The governor also will request legislative approval of additional funds in January.
  • In the early 1990s, Wisconsin could help pay for about half of each recipient's average natural gas bill in the winter, but today's contribution of $458 to each LIHEAP recipient will cover only about a quarter of the cost.

Thirty-one states have programs to help the poor pay energy bills that are funded by mandatory charges to energy consumers, according to Energy Outreach Colorado, which focuses on low-income heating issues.

Last year, Colorado lawmakers passed a bill to subsidize the state's heating assistance program through a voluntary 25-cent surcharge on utility bills. But GOP Gov. Bill Owens vetoed the bill because it required utility customers to "opt out" of paying the surcharge and he preferred an "opt in" approach.

States welcome the funding boost from Congress, but maintain that the rise in energy prices has far outpaced the increase in federal funding.

"If it's a cold winter and (energy) prices spike, this is not going to be adequate," Wolfe of the National Energy Assistance Director's Association said. He added that when federal funds are exhausted, the burden of helping to heat low-income households will fall on states' shoulders.

Indeed, a bipartisan group of 17 governors sent a letter to Congress in early October requesting that LIHEAP funding include a larger base grant and $600 million in emergency funding, but their appeal came up a bit short. President Bush approved $300 million in emergency funds that can be released at his discretion to address high energy prices, natural disasters or other crises, something states are hopeful he will do.

Bush hasn't indicated whether or when he plans to release the emergency funds, but a spokesman for the administration said the president has done so in the past. Clarence Carter, director of the Office of Community Services at the U.S. Department of Health and Human Services, said there may be a willingness to use the emergency funds if there's a big spike in fuel prices or a weather-related crisis.

Carter urged states to look to other social-service federal block grants to help pay for LIHEAP. "If indeed a state perceives that it has other energy-related concerns, they have other resources to them available by the federal government to meet the need," he said.

 
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