States, Community Groups Sweating Over LIHEAP Cuts

The White House's plan to cut more than $2.5 billion from a program that helps poor people pay for heating and cooling bills may leave millions out of luck, advocates say.
by | February 16, 2011
 

Kathy Tobin spends her days coordinating a program that provides low-income Boston-area residents with aid to help reduce their heating bills. Now, as the region has been hit with one of the most intense winters on record, that funding is being exhausted more quickly than it has in the past.

Tobin, who works for an organization called Action for Boston Community Development, Inc., says the maximum aid a family can receive is $515 for the entire season, even though it costs more than $800 to fill a home heating tank just once.

When residents call her office once they've exhausted their benefits, Tobin and her staff try to provide hope that more funding is in the pipeline, but they also offer more practical advice, like how to identify signs of hypothermia.

Given the situation in her city, Tobin is perplexed at the the White House's decision to propose slashing the budget for the Low Income Home Energy Assistance Program, which provides funding for the program her organization administers."We're having the most brutal, coldest and snowiest winter ever in an economy where people are in trouble," Tobin tells Governing. "The need has never been greater." Advocates for LIHEAP say the proposed cut is a mistake and could be dangerous or even deadly for low-income Americans.

Under the president's budget, funding for LIHEAP would be reduced from $5.1 billion to $2.57 billion in the 2012 fiscal year, a move that White House officials called a difficult choice. “This is a very hard cut,” budget director Jack Lew said at a Monday press conference. “This is a cut that has real impact."

LIHEAP helps low-income residents pay for a portion of their home heating and cooling bills by providing federal aid to state governments, based on their weather and low-income population. States run their own programs to distribute the aid, often relying on community action agencies, non-profits or localities to administer the programs.

In 2010, the 50 states and D.C. received an average of $96.3 million in LIHEAP funds. The largest recipient, New York state, received nearly $524.3 million.Generally, households that benefit from LIHEAP save about $385 on their energy bills annually, based on the most recent statistics available from the Department of Health and Human Services.

View a map of 2010 LIHEAP funding by state. The article continues below the map.

View 2010 LIHEAP Funding in a full screen map

The proposed cut, which would return LIHEAP funding to approximately its 2008 level, is one of the most controversial measures in the president's budget. And it has left politicians -- especially those in cold states -- up in arms.

"Failing to provide basic energy assistance for our low-income families, the millions of Americans seeking work, and middle-income Americans may threaten our economic recovery,” Republican Sens. Olympia Snowe and Susan Collins of Maine wrote in a letter to Lew last week.

Vermont's congressional delegation made a similar plea. Sen. Bernie Sanders said in a statement that he would do everything in his power "to make sure that the budget is not balanced on the backs of the weak, the vulnerable, the sick or the old who can’t afford to heat their homes in the winter."

Lew defended the cuts by arguing that in 2008, the program was funded at $2.5 billion, before a spike in energy prices. When those costs increased, LIHEAP funding was doubled. "We’re now at a price level that's close to where we were before that increase,” Lew said. “Looking at our fiscal challenges, we can’t just straight-line the program at $5 billion. So we have gone back to the level it was at when prices were roughly the same.”

But the National Energy Assistance Directors' Association, which represents state officials that administer LIHEAP programs, says the cut will mean millions of Americans will be left out in the cold.

The organization reports that LIHEAP currently serves 8.9 million people, and in 2008, it served 5.7 million. A return to 2008 funding levels means nearly 3.2 million people -- the difference between those numbers -- could lose their aid (see their math here). That's particularly troubling, since many beneficiaries would keep their homes at unhealthy temperatures in lieu of that help, according to the association.

Meanwhile, the proposed cuts come at a time of record demand. In 2008, 5.8 million sought assistance through LIHEAP programs. In 2010, 8.3 million sought aid, and this year, the association is projecting 8.9 million applications.

States are already anticipating the effect the cuts could have. The energy assistance program in Florida is projected to aid about 250,000 households this year and is entirely funded by federal LIHEAP money with no state contribution, officials there told Governing. If federal cuts come, the state government is unlikely to fill in the gaps.

The Florida program serves about 23 to 26 percent of people who are eligible; that figure could fall to 16 percent if the cuts come. "It's going to be drastic for us," said Paula Lemmo, community program manager with Florida's Department of Community Affairs.

Lew conceded that the program has "done an enormous amount of good for an enormous number of people." But, he added, “It was never meant to be an entitlement program. It was meant to be a grant program that the states administered.”

Tobin, of Boston, said she doesn't know why LIHEAP is being targeted, but if the cuts are made, residents are the ones who will suffer. She expects some people may have to make difficult choices such as whether to forgo meals or medicine for warmth.

"They're very worried and they're very concerned," Tobin says. "What do I do? We give them hope, but that's all I can give them right now."

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