Energy Assistance Program Begins Today, Available Funds Will Fall Short of Need.

Today, Community Action Agencies around the state will begin taking applications from elderly and disabled persons for the Energy Assistance Program. Other people in low-income households can begin applying on November 18th. The program is available for households with incomes at or below 125% of the federal poverty level, which for a family of four translates to an annual income of just $22,625. The average household benefit is roughly $250 for the entire heating season.

The program is funded through the federal Low-Income Home Energy Assistance Program (LIHEAP), and provides assistance on a first come first serve basis to low-income households. Currently, the state of Indiana does not use any of its dollars for the heating assistance and weatherization program.

President Bush has proposed a funding level of $1.4 billion for the program in fiscal year 2003. The Senate has proposed $1.7 billion for LIHEAP, while the House has yet to set a budget amount. That translates to $36 million under the Bush proposal or $43 million under the Senate proposal for Indiana. Two years ago Indiana received a record $68 million in LIHEAP funding thanks in part to Indiana’s Congressional delegation. However, even at record levels, the need for assistance far exceeded available funds.

In addition to the lack of federal funds and no state funds, additional funds that were available the past two years from the Lilly Endowment through the Help 2000 and Help 2001 program are no longer available because the endowment chose not to renew the program.

The Low-Income Energy Assistance Alliance finds the current funding situation alarming! According to some natural gas utilities, natural gas prices are projected to increase twenty to forty percent over last year, while the state has experienced record job loss, leaving many more families in need of assistance to cover winter heating bills. According to Ed Gerardot, Executive Director of the Indiana Community Action Association: “With federal funds shrinking, demand for assistance increasing, and the likelihood of a colder winter on the horizon, federal assistance dollars will fall far short of the need.”

The winter moratorium on disconnections only covers those households that are current on their bills and who have applied for and qualified for the Energy Assistance Program. The moratorium does not include or protect those households that heat with bulk fuels. Families that have lost their jobs in the second half of this year may not qualify for assistance because they may have exceeded income requirements for the year even though they desperately need help now. A last resort for many low-income households will be their township trustee’s office.

“The significant decrease in federal funding levels, increasing layoffs around the state and a large number of older homes needing weatherization all point to the need for a supplemental funding mechanism to the Federal program. As a percentage of their income, low-income households pay four to five times as much for home energy needs compared to non-low-income households,” said Dave Menzer of the Citizens Action Coalition, another Alliance member.

The Alliance believes long-term solutions for heating assistance need to focus on promoting and developing funding for energy efficiency measures. The surest way to ensure that weatherization programs receive adequate funding on a consistent basis is by means of a Public Benefits Charge, a small charge on all customers’ bills dedicated to weatherizing low-income households. Moreover, Public Benefits Funds could be used to address arrearage problems and shortfalls in heating assistance funds. Indeed, funds of this nature are in place in a number of states to deliver energy efficiency programs to all income groups. Consistently, these programs yield more savings and other benefits to customers than they cost.

“By weatherizing homes and installing more efficient furnaces all Indiana households could drastically cut their energy costs and reduce the likelihood that they would need assistance in the future,” concluded Gerardot.

The Low-Income Energy Assistance Alliance includes the Indiana Community Action Association, Catholic Charities, the Indianapolis Urban League, AARP, United Senior Action, Indiana Coalition on Housing and Homeless Issues, Indianapolis Resource Center for Independent Living, Organization for a New East Side, Citizens Action Coalition of IN and others.

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