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LIHEAP: Program and Funding

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The Low- Income Home Energy Assistance Program (LIHEAP): Program and Funding Libby Perl Specialist in Housing Policy August 27, 2009January 13, 2011 Congressional Research Service 7-5700 www.crs.gov RL31865 CRS Report for Congress Prepared for Members and Committees of Congress The Low- Income Home Energy Assistance Program (LIHEAP): Program and Funding Summary The Low Income Home Energy Assistance program (LIHEAP), established in 1981 as part of the Omnibus Budget Reconciliation Act of 1981 (P.L. 97-35), is a block grant program under which the the federal government makes annual grants to states, tribes, and territories to operate home energy energy assistance programs for low-income households. The LIHEAP statute authorizes two types of funds: regular funds, which are allocated to all states using a statutory formula, and emergency contingency funds, which are allocated to one or more states at the discretion of the Administration in cases of emergency as defined by the LIHEAP statute. States may use LIHEAP funds to help households pay for heating and cooling costs, for crisis assistance, weatherization assistance, and services (such as counseling) to reduce the need for energy assistance. According to the most recent data available from the Department of Health and Human Services (HHS), in FY2006, 49.6% of funds went to pay for heating assistance, 3.6% of funds was used for cooling aid, 17.8% of funds went to crisis assistance, and 10.0% was used for weatherization. The LIHEAP statute establishes federal eligibility for households with incomes at or below 150% of poverty or 60% of state median income, whichever is higher, although states may set lower limits. In FY2006, an estimated 34.4 However, in both the FY2009 and FY2010 appropriations acts, Congress gave states the authority to raise their LIHEAP eligibility standards to 75% of state median income. In FY2008, the most recent year for which HHS data are available, an estimated 33.5 million households were eligible for LIHEAP under the federal statutory guidelines. According to HHS, 5.54 million households received heating or winter crisis assistance and approximately 500 600,000 households received cooling assistance that same year. On September 27, 2008, Congress passed a continuing resolution for FY2009, the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act, which the President signed into law on September 30, 2008 (P.L. 110-329). The law appropriated $5.1 billion for LIHEAP in FY2009, exceeding by nearly $2 billion the FY2006 appropriation of approximately $3.2 billion, which previously had been the highest level of funding ever appropriated for the program. Of the $5.1 billion, approximately $4.5 billion was appropriated as regular funds and $590 million as contingency funds. In addition, P.L. 110-329 gave states the discretion to serve households with incomes at or below 75% of state median income in FY2009. In FY2010, the House- and Senate Appropriations Committee-passed appropriations bills (H.R. 3293) would fund LIHEAP at the same levels as FY2009, with $4.5 billion distributed as regular funds and $590 million as contingency funds. H.R. 3293 would also maintain the distribution of regular funds set out in the FY2009 appropriations act, when approximately $840 million was allocated according to the “new” LIHEAP formula and the remainder—approximately $3.67 billion—was distributed according to the proportions of the “old” formula. The amount for LIHEAP in H.R. 3293 exceeds the President’s request of $2.41 billion for LIHEAP regular funds and $790 million for contingency funds. The FY2010 Administration budget also proposed to create a trigger for additional LIHEAP funds to be released when energy prices increase above a certain level; this proposal would have resulted in an estimated $450 million in mandatory spending. Neither version of H.R. 3293 includes the President’s trigger same year. For FY2011, LIHEAP is funded through March 4, 2011, as part of the Continuing Appropriations and Surface Transportation Extensions Act (P.L. 111-322), which was enacted on December 22, 2010, and amends the Continuing Appropriations Act enacted on September 30, 2010 (P.L. 111242). Pursuant to P.L. 111-322 (the CR), HHS is required to obligate to states, tribes, and territories the same amount of LIHEAP regular funds as were obligated during the comparable time period in FY2010 (i.e., through March 4, 2010). States request their share of LIHEAP formula grants quarterly, and may request as much as 100% of their grants in the first quarter of the fiscal year. State allocations under the CR therefore depend on the amount of funds that each state requested in the first two quarters of FY2010, when the total amount appropriated for regular funds was $4.5 billion. On January 13, 2011, HHS issued a press release announcing how funds would be distributed to the states. See column (c) of Table A-1 for this distribution. In FY2010, Congress appropriated $5.1 billion for LIHEAP (P.L. 111-117), the same amount that was appropriated in FY2009. Of this amount, approximately $4.5 billion was appropriated as regular funds and $590 million as emergency contingency funds. The FY2010 appropriation also maintained the distribution of regular funds set out in the FY2009 appropriations act, with approximately $840 million allocated according to the “new” LIHEAP formula and the remainder—approximately $3.67 billion—distributed according to the proportions of the “old” formula. Three distributions of emergency contingency funds were made during FY2010 (see Table A-2). This report describes LIHEAP funding, current issues, legislation, program rules, and eligibility. It will be updated as events warrant. Congressional Research Service The Low- Income Home Energy Assistance Program (LIHEAP): Program and Funding Contents Introduction ................................................................................................................................1 LIHEAP Funding and Recent Developments ...............................................................................1 Proposed FY2010 Funding.........................................1 LIHEAP Funding Under the FY2011 Continuing Resolutions ...............................................1 Proposals to Fund LIHEAP in FY2011 Prior to Enactment of the Continuing Resolutions ........................1 FY2009 LIHEAP Funding.....................................................................................................2 Distribution of LIHEAP Contingency Funds.......3 FY2010 Funding .........................................................................4 FY2009 Contingency Funds..........................................5 Distribution of FY2010 LIHEAP Contingency Funds ..................................................4 LIHEAP Legislation in the 111th Congress....6 Program Rules and Benefits ...............................................................................5 Climate Change Legislation and LIHEAP .........................7 Federal Eligibility Standards and Grantee Responsibility.......................................................7 Kinds of Energy Assistance Available......................5 Program Rules and Benefits ..............................................................8 Use of Funds..........................................6 Federal Eligibility Standards and Grantee Responsibility.......................................................6 Kinds of Energy Assistance Available........................8 Households Served............................................................7 Use of Funds....................................................9 Benefit Levels.....................................................................7 Households Served..................................................9 Funds and Their Distribution..............................................................7 Benefit Levels....................................... 12 Regular Funds................................................................................8 Funds and Their Distribution..................................... 12 Tier I................................................................ 10 Regular Funds............................................................. 12 Tier II ........................................................ 10 Tier I................................................................... 13 Tier III .......................................................... 11 Tier II ................................................................ 13 Contingency Funds ........................................................... 11 Tier III .................................................. 13 Leveraging Incentive and REACH Funds ......................................................................... 11 Contingency Funds ... 14 Other Funds ..................................................................................................................... 12 Leveraging Incentive and REACH Funds ... 14 Legislative History............................................................................ 12 Other Funds ......................................... 14 Tables Table 1. FY2011 Proposed LIHEAP Funding ............................................................................... 12 Legislative History5 Table 2. LIHEAP Heating/Winter Crisis Aid for Select Years..................................................... 11 Table A-1. Net State LIHEAP Formula Grant Funding (Less Tribes) Under the FY2011 Continuing Resolutions (CRs)......................................................................................... 13 Tables Table 1. Proposed FY2010 LIHEAP Funding ....... 18 Table A-2. FY2010 LIHEAP Regular and Contingency Fund Allotments to States, Tribes, and Territories ...............................................................................4 Table 2. LIHEAP Heating/Winter Crisis Aid, Selected Years ......................................... 20 Table A-3. LIHEAP Funding by State FY2006 to FY2010........................................................9 Table 3. LIHEAP Funding by State, FY2006 to FY2009. 23 Table A-4. LIHEAP Funding: FY1982 to FY2011 ............................................................ 14 Table 4. LIHEAP Funding: FY1982 to FY2010................. 26 Appendixes Appendix. Tables Showing LIHEAP Funding Levels................................................................. 16 Congressional Research Service The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding Contacts Author Contact Information ...................................................................................................... 1828 Congressional Research Service The Low- Income Home Energy Assistance Program (LIHEAP): Program and Funding Introduction The Low- Income Home Energy Assistance program (LIHEAP), established by Title XXVI of the Omnibus Budget Reconciliation Act of 1981 (P.L. 97-35), is a block grant program under which the federal government gives states, tribes, and territories annual grants to operate home energy assistance programs for low-income households. The LIHEAP statute provides for two types of program funding: regular funds and contingency funds. (sometimes referred to in this report as “formula funds”) and emergency contingency funds (sometimes referred to in this report as “contingency funds”). Regular funds are allotted to states according to a formula prescribed by the LIHEAP statute. 1 The second type of LIHEAP funding, called contingency funds,1 Contingency funds may be released and allotted to one or more states at the discretion of the the President and the Secretary of Health and Human Services (HHS). The first section of this report describes proposed funding for LIHEAP in FY2010 as well as FY2009 appropriations. It also discusses current issues and legislation related to LIHEAP. The FY2011 and enacted funding in FY2010. The second section of this report discusses LIHEAP rules, including household eligibility and how funds may be used, and presents the most recent data available from HHS regarding household characteristics and benefit levels. Finally, the third section discusses how each category of LIHEAP funds is distributed to states, as well as a breakdown of funds to the states during the last several fiscal years. LIHEAP Funding and Recent Developments Proposed FY2010 Funding In FY2010, both the House-passed version of the Departments of Labor, Health and Human Services, and Education appropriations bill as well as the Senate Appropriations Committeepassed version (H.R. 3293) would provide $5.1 billion for LIHEAP, the same amount that was appropriated in FY2009. Both versions of the bill would also maintain the same division of funds as in FY2009, with $4.51 billion allocated to LIHEAP regular funds and approximately $590 million to emergency contingency funds. H.R. 3293 further specifies that the regular funds would be distributed to the states as they were in FY2009: • Approximately $840 million would be distributed according to the “new” LIHEAP formula. The new formula was enacted in 1984 and allocates funds to states on the basis of the heating and cooling costs of low-income households. For more information about the LIHEAP formula, see the section of this report entitled “Funds and Their Distribution.” • The remaining $3.67 billion would be distributed according to the proportion of funds that states received under the “old” LIHEAP formula, which existed prior to the enactment of the new formula in 1984. The House-passed version of H.R. 3293 would also allow states to raise eligibility guidelines for LIHEAP up to 75% of state median income, a provision that was also included in the FY2009 Appropriations Act. The Senate Appropriations Committee-passed version of the bill does not LIHEAP Funding Under the FY2011 Continuing Resolutions In FY2011, LIHEAP has been funded by a series of continuing resolutions (CRs), each of which funded most government programs at FY2010 levels—in the case of LIHEAP, this means $4.5 billion in regular funds. However, due to language in the CRs, combined with the proposed funding level in the Senate Appropriations Committee-passed bill (S. 3686), as of the date of this report states have not received the exact allocations that they would receive at an appropriation of $4.5 billion. This is explained below. See Table A-1 in the Appendix of this report to see how funds have been distributed pursuant to the CRs. The First Three Continuing Resolutions (Through December 21, 2010) Pursuant to the first three CRs (P.L. 111-242, P.L. 111-290, and P.L. 111-317), which extended funding for most federal programs at FY2010 levels through December 21, 2010, LIHEAP grantees were not able to receive their full allocations of regular funds at the $4.5 billion level. This was due to a standard provision in continuing resolutions that states the following: For those programs that would otherwise have high initial rates of operation or complete distribution of appropriations at the beginning of fiscal year 2011 because of distributions of funding to States, foreign countries, grantees, or others, such high initial rates of operation or 1 See Section 2604(a)-(d) of the Low Income Home Energy Assistance Act (Title XXVI of P.L. 97-35), as amended. The section is codified at 42 U.S.C. § 8623(a)-(d). Congressional Research Service 1 The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding contain this provision. Ordinarily, states may set eligibility for LIHEAP assistance at the greater of 60% of state median income or 150% of poverty. 2 The amount for LIHEAP in the House-passed and Senate Appropriations Committee-passed versions of H.R. 3293 exceed the President’s request for LIHEAP regular and contingency funds by $1.9 billion. The President proposed to provide $2.41 billion for regular funds and $790 million for emergency contingency funds. In addition, H.R. 3293 does not include the President’s proposal for a new LIHEAP trigger whereby additional funds would be released “whenever there is a spike in energy costs.”3 The budget estimated that the trigger would result in mandatory budget authority of $450 million in FY2010. According to HHS budget justifications, funds were to be triggered when certain price benchmarks were met:4 • For oil and natural gas, when quarterly prices are at least 15% higher than in the previous year. Specifically, (1) at a 15% price increase, funds would be distributed by multiplying the percentage change in price by the total amount of the previous year’s block grant funding and then multiplying that result by 20%; (2) at a price increase of 30% or greater, funds would be distributed by multiplying the percentage increase in price by the previous year’s block grant funding level, and then that result would be multiplied by 25%. • For electricity, when quarterly prices are at least 10% higher than in the previous year. The amount of funds released would be the product of the percentage increase in prices multiplied by the previous year’s block grant funding level, with that result multiplied by 10%. Under the proposal, the Secretary would have discretion in distributing funds to the states based on the impact of the price increases and the number of low-income households in each state that use the particular type of fuel at issue. The budget justifications further stated that other factors such as extreme weather or economic conditions could be considered in designing a LIHEAP trigger. Although the FY2010 Budget Resolution (S.Con.Res. 13) gave the House Budget Committee authority to adjust aggregate spending levels and allocations to committees in order to accommodate the creation of a LIHEAP trigger, the resolution also allowed for LIHEAP appropriations to be increased to $5.1 billion in lieu of the trigger. Both versions of H.R. 3293 take the latter approach. See Table 1 for a breakdown of proposed FY2010 funding. FY2009 LIHEAP Funding In FY2009, Congress appropriated $5.1 billion for LIHEAP, the most funding that has ever been provided for the program, as part of the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act (H.R. 2638), which President Bush signed into law on September 30, 2008 (P.L. 110-329). The appropriation exceeded President Bush’s FY2009 budget request by $3.1 billion. The appropriation also nearly doubled the $2.57 billion that Congress had provided 2 42 U.S.C. §8624(b)(2)(B). 3 Office of Management and Budget, A New Era of Responsibility, Renewing America’s Promise, p. 70, http://www.whitehouse.gov/omb/assets/fy2010_new_era/A_New_Era_of_Responsibility2.pdf. 4 U.S. Department of Health and Human Services, Administration for Children and Families, FY2010 Congressional Justification, pp. 32-33, http://www.acf.hhs.gov/programs/olab/budget/2010/sec2b_liheap_2010cj.pdf. Congressional Research Service 2 The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding for the program in FY2008. Previously, the highest level of funding for LIHEAP had been $3.16 billion, appropriated in FY2006. In that year, Congress appropriated an additional $1 billion for LIHEAP on top of the annual appropriation. Of the total amount appropriated in FY2009, $4.51 billion was allocated to LIHEAP regular funds and $590 million to contingency funds. A portion of the regular funds—approximately $840 million—was distributed according to the “new” LIHEAP formula, while the remainder— $3.67 billion—was distributed based on the proportions for the “old” LIHEAP formula. (For more information about the LIHEAP formula, see CRS Report RL33275, The LIHEAP Formula: Legislative History and Current Law, by Libby Perl.) The FY2009 Continuing Appropriations Act further specified that states could use these FY2009 funds to serve households with incomes at or below 75% of state median income at their discretion.5 Ordinarily, states may set eligibility for LIHEAP assistance at the greater of 60% of state median income or 150% of poverty.6 P.L. 110-329 also required HHS to obligate all FY2009 LIHEAP funds, including the contingency funds, within 30 days of enactment of the law. On October 16, 2008, HHS released tables showing how both LIHEAP regular and contingency funds would be distributed to the states, tribes, and territories. In addition, HHS announced that it would distribute FY2009 leveraging incentive and Residential Energy Assistance Challenge (REACH) grants7 on the basis of FY2008 applications submitted by states and tribes. In FY2008, Congress did not authorize funds for leveraging incentive and REACH grants in the appropriations law. When HHS discovered that language to appropriate the funds was missing from the appropriations act, it released to the states the $26.7 million that would otherwise have been distributed as leveraging incentive and REACH grants according to the LIHEAP formula. To see how FY2009 LIHEAP funds were allocated to the states, see Table 3 at the end of this report. 5 HHS annually publishes state median income data in the Federal Register. For FY2009 data, see Federal Register, vol. 73, no. 44, March 5, 2008, p. 11924. 6 42 U.S.C. §8624(b)(2)(B). 7 Since the early 1990s, leveraging incentive and REACH grants have been made to states and tribes according to their ability to obtain non-LIHEAP resources for energy assistance (leveraging incentive grants) and for increasing the energy efficiency of low-income households (REACH grants). These funds are discussed later in this report. Congressional Research Service 3 The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding Table 1. Proposed FY2010 LIHEAP Funding Regular Funds Source of Proposed Funding State Formula Grants Set-Asidesa Contingency Funds LIHEAP “Trigger”b Total $790 million $450 million $3.65 billion President’s request $2.41 billion $27 million leveraging incentive grantsc House-passed H.R. 3293 $4.51 billion not specifiedd $590 million 0 $5.1 billion Senate Appropriations Committee-passed H.R. 3293 $4.51 billion not specified $590 million 0 $5.1 billion Source: Congressional Research Service (CRS), on the basis of the FY2010 budget appendix, the Department of Health and Human Services (HHS) Congressional Budget Justification, and the Departments of Labor, Health and Human Services, and Education appropriations bill, H.R. 3293. a. The LIHEAP statute gives the HHS Secretary authority to set aside up to $300,000 from the regular fund appropriation for training and technical assistance. 42 U.S.C. § 8628a. b. In FY2010, the President’s budget proposed that a trigger mechanism be created whereby funds would be released if energy price increases exceed certain levels. The estimated $450 million additional budget authority under the trigger would be mandatory funding. For more information about the trigger, see the section of this report entitled “Proposed FY2010 Funding.” c. The amount proposed to be set aside for leveraging incentive grants in FY2010 is noted in the HHS Congressional Budget Justification and does not appear in the budget appendix. d. The House Appropriations Committee Report, H.Rept. 111-220, specified that not more than $27 million be used for leveraging incentive grants. Distribution of LIHEAP Contingency Funds FY2009 Contingency Funds In FY2009, Congress appropriated approximately $590 million in LIHEAP contingency funds as part of P.L. 110-329, the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act. The law specified that HHS must obligate the funds to states within 30 days of the law’s enactment (September 30, 2008). On October 16, 2008, HHS announced that it would release the contingency funds to all states, tribes, and territories—of the $590 million, $490 million was released to all states according to the proportion of funds that states received under the old LIHEAP formula, and $100 million was released to seven states where at least 30% of low-income households use heating oil to heat their homes. The seven states received funds according to the proportion of funds they received under the old LIHEAP formula weighted by their share of low-income heating oil users. These seven recipient states were Alaska, Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont. For the amount of contingency funds received by each state in FY2009, see Table 3 at the end of this report. Congressional Research Service 4 The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding LIHEAP Legislation in the 111th Congress Bills that would affect aspects of LIHEAP have been introduced in the 111th Congress. This is not necessarily an exhaustive list of LIHEAP-related legislation. • The LIHEAP Equity Act (H.R. 252), would mandate that no more than 50% of the funding provided for LIHEAP regular funds be made available for heating purposes. • The Home Energy Assistance Targeted for Seniors Act (H.R. 1140) would rename LIHEAP the “Low Income and Senior Home Energy Assistance Act” and make eligible for benefits households with incomes at or below state median income, as long as at least 50% of the household’s income was attributable to persons age 65 and older. (Currently households may not have incomes above 60% of state median income and still be eligible for LIHEAP.) • The Consumer Reasonable Price Protection Act (H.R. 1482) would impose a windfall profits tax on sellers of crude oil and natural gas, with the proceeds going to LIHEAP. The bill would establish a reasonable profits board to determine what constitutes a reasonable profit from the sale of these products. A windfall profits tax would be imposed when profits exceed reasonable profits by 100% or more. • The Federal Price Gouging Prevention Act (H.R. 2129) would make it illegal to charge excessive prices for gasoline and other petroleum distillate products if an “energy emergency” is declared by the President. Specifically, it would be illegal to sell those products at unconscionably excessive prices that indicate the seller is taking unfair advantage of an energy emergency. Penalties imposed for violations of these provisions would be deposited in a Consumer Relief Trust Fund which could be used to provide LIHEAP assistance. Climate Change Legislation and LIHEAP The 111th Congress is likely to consider legislation that would aim to reduce levels of greenhouse gas emissions produced by various industrial processes. This is sometimes referred to as climate change legislation. Among those industries that would likely be targeted by a greenhouse gas reduction policy are power plants that generate electricity, oil refineries, and natural gas suppliers. The details of a plan to regulate greenhouse gases could take different forms, although the primary models that have been discussed are a direct tax on emissions (sometimes referred to as a carbon tax) or a cap-and-trade system in which regulated entities would buy allowances that permit them to emit carbon and other greenhouse gases. Depending on the details of a greenhouse gas reduction plan, energy prices paid by consumers could increase. 8 In addition, the effects of such a system could be regressive—that is, lower-income households could pay a larger percentage of their income toward increased energy prices than higher-income households. 9 8 See, for example, Terry Dinan and Diane Lim Rogers, “Distributional Effects of Carbon Allowance Trading: How Government Decisions Determine Winners and Losers,” National Tax Journal, vol. 55, no. 2 (June 2002), pp. 199-221. 9 See Terry Dinan, Trade-Offs in Allocating Allowances for CO2 Emissions, Congressional Budget Office, April 25, 2007, http://www.cbo.gov/ftpdocs/89xx/doc8946/04-25-Cap_Trade.pdf; and Dallas Burtraw, Rich Sweeney, and Margaret Walls, The Incidence of U.S. Climate Policy: Where You Stand Depends on Where You Sit, Resources for the (continued...) Congressional Research Service 5 The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding In the 110th Congress, numerous bills to curb greenhouse gas emissions were introduced. At least four of these bills would have allocated a portion of the proceeds from the sale of allowances to LIHEAP in order to mitigate the effects of price increases on low-income households. These included the Low Carbon Economy Act of 2007 (S. 1766), the Lieberman-Warner Climate Security Act of 2008 (S. 3036), the Investing in Climate Action and Protection Act (H.R. 6186), and the Climate MATTERS Act of 2008 (H.R. 6316). It is possible that climate change legislation in the 111th Congress could also include funds for LIHEAP Income Home Energy Assistance Program (LIHEAP): Program and Funding complete distribution shall not be made, and no grants shall be awarded for such programs funded by this Act that would impinge on final funding prerogatives.2 The provision is meant to ensure that funds for a program that are released under a CR do not exceed the amount that Congress ultimately appropriates for it. Typically, states are eligible to receive their entire LIHEAP formula allocations in the first quarter of the fiscal year if they so choose, qualifying as a “high initial rate of operation” as stipulated in the CR. Further, the Senate Appropriations Committee-passed FY2011 Departments of Labor, Health and Human Services, and Education Appropriations bill (S. 3686) raised the possibility that Congress might appropriate less funding for LIHEAP in FY2011 than it did in FY2010 (S. 3686 would have appropriated $2.7 billion in LIHEAP regular funds). If HHS had released regular fund allocations at the $4.5 billion level, and the appropriation level in the Senate Committee proposal of $2.7 billion had ultimately been enacted, then states would have received higher allocations than the amount to which they would have been entitled under the final appropriation, impinging on “final funding prerogatives.” As a result, due to the difference in the level of formula funding for LIHEAP in FY2010 compared to the amount proposed by the Senate Appropriations Committee bill for FY2011, until mid-December 2010 HHS limited LIHEAP state allocations to 75% of the amount they would have received if the Senate Committee-passed appropriations bill was enacted. 3 On December 10, 2010, due to concerns that states did not have sufficient funds to assist applicants, HHS announced that states could receive 100% of their allocations at this $2.7 billion regular fund level. 4 The Fourth Continuing Resolution Most recently, a fourth CR, the Continuing Appropriations and Surface Transportation Extensions Act (P.L. 111-322), was enacted on December 22, 2010, and increased the amount of LIHEAP regular funds that states may receive for FY2011. P.L. 111-322, which amends P.L. 111-242, is effective through March 4, 2010, and requires that HHS “obligate the same amount during the period covered by this continuing resolution as was obligated for such purpose during the comparable period during fiscal year 2010.”5 The amount that each state receives pursuant to this provision therefore depends on the amount of funding that each state requested in the first two quarters of FY2010 based on a regular fund level of $4.5 billion. On January 12, 2011, HHS announced the distribution of funds under the fourth CR.6 Most states did not receive exactly the amount that was obligated to them in FY2010 because funds had to be prorated to account for three states (California, North Carolina, and Tennessee) that had requested greater percentage allocations in the first quarter of FY2011 than they had in FY2010 and had therefore already received more in FY2011 under the first three CRs than was obligated to them in the first two quarters of FY2010. For example, in FY2010 California requested 25% of its 2 See Section 109 of P.L. 111-242. For state allocations at this rate, see http://www.acf.hhs.gov/programs/ocs/liheap/2011_cr_state_allocations.xls. 4 U.S. Department of Health and Human Services, “HHS Makes Available More Than $670 Million in Additional LIHEAP Funding,” press release, December 10, 2010, http://www.hhs.gov/news/press/2010pres/12/20101210b.html. 5 See Section 162 of P.L. 111-322. 6 U.S. Department of Health and Human Services, “HHS increases total LIHEAP funding available to help low-income families to $3.9 billion,” press release, January 12, 2011, http://www.hhs.gov/news/press/2011pres/01/20110112a.html. 3 Congressional Research Service 2 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding regular fund allocation in the first quarter; in the first quarter of FY2011, it requested 100% of its allocation at $2.7 billion, or $119 million, which exceeded the amount obligated through March 4, 2010 (approximately $100 million). For the distribution of funds to states under the fourth CR, see Table A-1. Proposals to Fund LIHEAP in FY2011 Prior to Enactment of the Continuing Resolutions The President’s budget proposed to provide $2.51 billion for LIHEAP regular funds and $790 million in emergency contingency funds, for a total of $3.3 billion in discretionary spending. While this represented an increase over the President’s FY2010 request for regular and contingency funds (by $100 million), it would have been a decrease from FY2010 funding levels, in which Congress provided a total of $5.1 billion for LIHEAP—$4.51 billion in regular funds and $590 million in contingency funds. However, as in FY2010, the President proposed a new trigger mechanism for releasing LIHEAP funds. According to the budget, additional funds were to be released “in response to energy price spikes as well as changes in the number of households in poverty.”7 The budget estimated that the trigger would have resulted in mandatory budget authority of $2 billion in FY2011. The proposal in the FY2011 budget differed from the FY2010 proposal, which would have triggered increased assistance only in response to energy price increases and did not include an increase in the number of households in poverty as a basis for additional funds to be released. According to HHS budget documents, FY2011 fund releases would have been triggered if certain benchmarks were met:8 • For oil and natural gas, if quarterly prices were at least 15% higher than in the previous year’s quarter in either the third or fourth quarters of the calendar year (from July through September and October through December, respectively). Specifically, (1) at a 15% price increase, funds would have been distributed by multiplying the percentage change in price by the greater of $250 million or 10% of the previous year’s regular fund appropriation; (2) at a price increase of 30% or greater, funds would have been distributed by multiplying the percentage increase in price by the greater of $300 million or 15% of the previous year’s regular fund appropriation. • For electricity, if quarterly prices were at least 10% higher than in the previous year’s quarter for any of the four quarters of the calendar year. The amount of funds released would have been the product of the percentage increase in price multiplied by the greater of $250 million or 10% of the previous year’s regular fund appropriation. • In the case of poverty, if the ratio of the average number of participants in the Supplemental Nutrition Assistance Program (SNAP, formerly known as Food Stamps) to the U.S. population in a fiscal year was at least 30% greater than the 7 U.S. Office of Management and Budget, FY2011 Budget Appendix, February 2010, p. 494, http://www.whitehouse.gov/omb/budget/fy2011/assets/hhs.pdf. 8 U.S. Department of Health and Human Services, Administration for Children and Families, FY2011 Congressional Justification, pp. 31-32, http://www.acf.hhs.gov/programs/olab/budget/2011/LIHEAP.pdf. Congressional Research Service 3 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding ratio of participants for FY2008. The amount of funds released would have been the product of any percentage increase over 30% and $6.25 billion. For example, an increase of 50% would have resulted in the release of $1.25 billion (20% * $6.25 billion). Under the proposal, funds would have been distributed within 30 days of the time when the requirements of the applicable trigger were met unless there were extenuating circumstances.9 In determining how funds would be distributed to states, the Administration would have been required to take into account the price increases or SNAP participation that caused the funds to be released as well as the number of low-income households in each state. In addition, the Administration would have had the discretion to use funds to respond to “extreme heat or cold, energy supply disruptions, or a variety of other energy-related emergencies.”10 The Senate Appropriations Committee proposed to appropriate $3.3 billion for LIHEAP in FY2011. The bill, S. 3686, was reported on August 2, 2010, and would have provided $2.7 billion in regular funds. It would have maintained the proportional split between “old” and “new” formula funds that was implemented in FY2009. Specifically, approximately 20% of regular funds, $505 million, would have been distributed according to the “new” LIHEAP formula. The remaining $2.2 billion would have been distributed according to the proportions of the “old” formula. S. 3686 would have appropriated the same level of funding for emergency contingency funds as was appropriated in FY2009 and FY2010—$590 million. In addition, the Senate Appropriations Committee Report, S.Rept. 111-243, stated that “[t]he Committee recommendation assumes enactment of [the President’s trigger] proposal.” However, neither S. 3686 nor S.Rept. 111-243 contained language to authorize the trigger. The House Appropriations Subcommittee for the Departments of Labor, Health and Human Services, and Education recommended $5.1 billion for LIHEAP in FY2011; however, the specifics of the proposal were not provided. 11 9 Ibid., p. 32. Ibid. 11 See the Subcommittee Summary Table, available on its website at http://appropriations.house.gov/images/stories/pdf/ lhhse/FY2011_LHHS_Summary_Tabel-07.15.2010.pdf. 10 Congressional Research Service 4 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding Table 1. FY2011 Proposed LIHEAP Funding (dollars in millions) Type of Funding LIHEAP Regular Fundsb Leveraging Incentive/ REACH Grants Contingency Funds Total Discretionary Funds LIHEAP “Trigger”e Total FY2011 House Subcommittee Passed Billa FY2011 Senate CommitteePassed Bill: S. 3686 FY2010 Enacted: P.L. 111-117 FY2011 President’s Request 4,510 2,510 — 2,710 27c — not specified 590 790 — 590 5,100 3,300 — 3,300 0 2,000 — f 5,100 5,300 5,100 3,300 27d Sources: The FY2010 Consolidated Appropriations Act (P.L. 111-117), the FY2011 budget appendix, the FY2011 Department of Health and Human Services (HHS) Congressional Budget Justifications, the FY2011 Departments of Labor, Health and Human Services, and Education (LHE) appropriations bill (S. 3686), and the House LHE Appropriations Subcommittee Summary Table. a. As of the date of this report, details about the House Appropriations Subcommittee-passed bill had not been released. b. In addition to the set-aside for Leveraging Incentive and REACH grants, the LIHEAP statute gives the HHS Secretary authority to set aside up to $300,000 from the regular fund appropriation for training and technical assistance. 42 U.S.C. § 8628a. c. The amount proposed to be set aside for leveraging incentive grants in FY2011 was noted in the HHS Congressional Budget Justifications and did not appear in the budget appendix. d. P.L. 111-117 specified that not more than $27 million be used for leveraging incentive grants in FY2010. e. In FY2010 and FY2011, the President’s budget proposed that a trigger mechanism be created whereby funds would be released if energy price increases were to exceed certain levels or, as proposed in FY2011, if participation in the Supplemental Nutrition Assistance Program was to increase above a specified level. In each case, the additional budget authority under the trigger would be mandatory funding. f. Regarding the President’s proposed LIHEAP trigger, S.Rept. 111-243 stated that the “Committee recommendation assumes enactment of this proposal.” However, neither S. 3686 nor S.Rept. 111-243 contained language that would authorize the trigger proposal. FY2010 Funding The FY2010 Consolidated Appropriations Act (P.L. 111-117), enacted on December 16, 2009, provided $5.1 billion for LIHEAP, the same amount that was appropriated in FY2009.12 The law also maintained the same division of funds as in FY2009, with $4.51 billion allocated to LIHEAP regular funds and approximately $590 million to emergency contingency funds. However, unlike the FY2009 appropriation, which specified that the contingency funds be released within 30 days of the law’s enactment, under the FY2010 law there was no time frame for releasing the 12 Prior to enactment of P.L. 111-117, LIHEAP was funded under two continuing resolutions (CRs): P.L. 111-68 and P.L. 111-88. Under the two CRs, states were eligible to receive up to 75% of their regular fund allocations at an appropriation of $4.51 billion (the FY2009 level). Congressional Research Service 5 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding contingency funds. Regarding the regular funds, P.L. 111-117 distributed funds to the states in the same way as FY2009, as follows: • Approximately $840 million was distributed according to the “new” LIHEAP formula. The new formula was enacted in 1984 and allocates funds to states on the basis of the heating and cooling costs of low-income households. For more information about the LIHEAP formula, see the section of this report entitled “Funds and Their Distribution” or, for greater detail, see CRS Report RL33275, The LIHEAP Formula: Legislative History and Current Law, by Libby Perl. • The remaining $3.67 billion was distributed according to the proportion of funds that states received under the “old” LIHEAP formula, which existed prior to the enactment of the new formula in 1984. See column (a) of Table A-2, at the end of this report, for the distribution of FY2010 LIHEAP regular funds to the states and tribes. In addition, P.L. 111-117 gave states the authority to raise eligibility guidelines for LIHEAP to 75% of state median income, a provision that was also included in the FY2009 appropriations act. Ordinarily, states may set eligibility for LIHEAP assistance at the greater of 60% of state median income or 150% of poverty.13 The amount for LIHEAP in P.L. 111-117 exceeded the President’s request for LIHEAP regular and contingency funds by $1.9 billion; the President had proposed to provide $2.41 billion for regular funds and $790 million for emergency contingency funds. In addition, P.L. 111-117 did not include the President’s proposal for a new LIHEAP trigger whereby additional funds would have been released “whenever there is a spike in energy costs.”14 The budget estimated that the trigger would have resulted in mandatory budget authority of $450 million in FY2010. Distribution of FY2010 LIHEAP Contingency Funds The FY2010 Consolidated Appropriations Act (P.L. 111-117) provided $590 million for LIHEAP contingency funds, the same amount that was appropriated in FY2009. However, unlike FY2009, where the appropriations act required funds to be released within 30 days of the law’s enactment, FY2010 did not require the release of contingency funds within a certain time frame. The Administration distributed FY2010 contingency funds on two occasions. First, the Administration announced the release of approximately $490 million of the FY2010 contingency funds on January 20, 2010. • Of the total, $450 million was released to all states, tribes, and territories. Each state’s allocation was based on their share of formula funds received in FY2010 weighted by their three-month unemployment rate from September 2009 through November 2009. The allotment to territories was based on their share of formula grants. 13 42 U.S.C. § 8624(b)(2)(B). Office of Management and Budget, A New Era of Responsibility, Renewing America’s Promise, p. 70, http://www.whitehouse.gov/omb/assets/fy2010_new_era/A_New_Era_of_Responsibility2.pdf. 14 Congressional Research Service 6 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding • The remaining $40 million was released to 14 states where the number of heating degree days (HDDs) from November 1, 2009, through January 9, 2010, exceeded the 30-year norm for the same time period by at least 5%. (HDDs measure the extent to which a day’s average temperature falls below 65° Fahrenheit. For example, a day with an average temperature of 50° F results in a measure of 15 heating degree days.) These states then received amounts based on a ratio of the product of total HDDs, the number of households at or below 125% of poverty, and the unemployment rate to the sum of the products for all 14 states. The second contingency fund distribution was announced on September 20, 2010. The remaining funds—approximately $101 million—were distributed to all fifty states, the District of Columbia, and the territories based on the proportions of the “old” LIHEAP formula. Columns (b), (c), and (d) of Table A-2 (at the end of this report) show the amount of funds that states received under each of the contingency fund distributions. Program Rules and Benefits Federal LIHEAP requirements are minimal and leave most important program decisions to the states, the District of Columbia, the territories, and Indian tribes and tribal organizations (collectively referred to as grantees) who receive federal funds. The federal government (HHS) may not dictate how grantees implement “assurances” that they will comply with general federal guidelines. Federal Eligibility Standards and Grantee Responsibility Federal law limits LIHEAP eligibility to households with incomes up to 150% of the federal poverty income guidelines (or, if greater, 60% of the state median income). States may adopt lower income limits, but no household with income below 110% of the poverty guidelines may be considered ineligible. States may separately choose to make eligible for LIHEAP assistance any household of which at least one member is a recipient of Temporary Assistance for Needy Families (TANF), Supplemental Security Income (SSI), Food Stamps, or certain needs-tested veterans’ programs. LIHEAP assistance does not reduce eligibility or benefits under other aid programs. Within these limits, grantees decide which, if any, assistance categories to include, what income limits to use, and whether to impose other eligibility tests. The statute gives priority for aid to households with the greatest energy needs or cost burdens, especially those that include disabled individuals, frail older individuals, or young children. Federal standards require grantees to treat owners and renters “equitably,” to adjust benefits for household income and home energy costs, and to have a system of “crisis intervention” assistance for those in immediate need. The LIHEAP definition of “energy crisis” leaves room for each state to define the term slightly differently, although generally, crisis assistance is provided to households that are in danger of losing their heating or cooling due to problems with equipment, receipt of a utility shutoff notice, or exhaustion of a fuel supply. 1015 Federal rules also require outreach activities, coordination with the Department of Energy’s Weatherization Assistance Program, annual audits and appropriate fiscal controls, and fair hearings for those aggrieved. Grantees decide the mix and dollar range of (...continued) Future, September 2008, http://www.rff.org/RFF/Documents/RFF-DP-08-28.pdf. 10 15 The LIHEAP statute defines an energy crisis as “weather-related and supply shortage emergencies and other household energy-related emergencies.” 42 U.S.C. § 8622(3). For the state definitions of “crisis” see the HHS LIHEAP Networker FY2007 compilation of definitions, available at http://www.liheap.ncat.org/tables/FY2007/ CrisisDef2007.doc.(continued...) Congressional Research Service 67 The Low- Income Home Energy Assistance Program (LIHEAP): Program and Funding Department of Energy’s Weatherization Assistance Program, annual audits and appropriate fiscal controls, and fair hearings for those aggrieved. Grantees decide the mix and dollar range of benefits, choose how benefits are provided, and decide what agencies will administer the program. 1116 Kinds of Energy Assistance Available Funds are available for four types of energy assistance to eligible households: • help paying heating or cooling bills; • low-cost weatherization projects (e.g., window replacement or other homeenergy related repair; limited to 15% of allotment unless a grantee has a waiver for up to 25%); • services to reduce need for energy assistance (e.g., needs assessment, counseling on how to reduce energy consumption; limited to 5% of allotment); and • help with energy-related emergencies (winter or summer crisis aid). Use of Funds The greatest share of LIHEAP funding is used to offset home heating costs. In FY2006, approximately 49.6% of all LIHEAP funds were used to provide heating assistance; all states (including the District of Columbia) provided some heating assistance.1217 Nearly all states also offered crisis assistance, most of which is used for heating needs. In FY2006, 17.8% of LIHEAP funds was used to provide crisis assistance in 48 states. Seven of these 48 states provided summer as well as winter crisis assistance, and one state—Hawaii—provided only summer crisis assistance. 1318 Also in FY2006, 3.6% of funds went for cooling aid (offered by 13 states); 10.0% of total LIHEAP funds was used for weatherization services (provided by 45 states); 7.7% of available funds went for administration and planning purposes (51 states), and 1.2% of the FY2006 funds was used to offer services to reduce the need for energy assistance (provided by 24 states).14 Households Served In FY2006, it is estimated that 5.5 million households received LIHEAP heating or winter crisis assistance. 15 This estimate attempts to remove duplication among households that received both heating and winter crisis assistance; the estimate is derived from the 5.0 million households that received heating assistance and the 1.5 million that received winter or year round crisis assistance in FY2006. The number of households receiving heating or winter crisis assistance in FY2006 increased from FY2005, when an estimated 5.3 million households were served. Shortly after 1119 (...continued) Networker FY2007 compilation of definitions, available at http://www.liheap.ncat.org/tables/FY2007/ CrisisDef2007.doc. 16 Information regarding state LIHEAP program characteristics and contacts is available at http://www.liheap.ncat.org/ sp.htm. 1217 Based on state-reported total LIHEAP obligations for FY2006 of $3.2 billion. U.S. Department of Health and Human Services, Administration for Children and Families, Low Income Home Energy Assistance Program Report to Congress for Fiscal Year 2006, April 22, 2009, p. 16 (hereafterhereinafter, FY2006 LIHEAP Report to Congress). 1318 Ibid., Table C-3, pp. 61-62. 1419 Ibid., p. 16. 15 Ibid., p. 21. Congressional Research Service 78 The Low- Income Home Energy Assistance Program (LIHEAP): Program and Funding Households Served In FY2008, it is estimated that 5.4 million households received LIHEAP heating and/or winter crisis assistance. 20 This estimate attempts to remove duplication among households that received both heating and winter crisis assistance. The number of households receiving heating and/or winter crisis assistance in FY2008 increased from FY2007, when an estimated 5.3 million households were served. Shortly after LIHEAP began, in FY1983, approximately 6.8 million LIHEAP began, in FY1983, approximately 6.8 million households received heating and/or winter crisis assistance. Since that time, the number of households receiving assistance declined generally until FY2000, reaching a low of 3.6 million recipients in FY1999. After FY2000, the number of recipient households began increasing again to the current level. (See Table 32.) The same trend can be seen in the percentage of federally eligible households that receive heating and/or winter crisis assistance. In FY1983, the 6.8 million households that received funds represented represented 31% of federally eligible households. By FY1999, the number of federally eligible households households receiving LIHEAP heating and/or winter crisis assistance had dropped to 12%. In FY2004, 14% of Since FY2003, the percentage of federally eligible households received assistance, which grew to 15% in FY2005, and in FY2006, that number increased to 16%. The number of households receiving cooling assistance reached a high point in FY2002, with 570,000 recipients. However, in FY2006, cooling assistance nearly reached this level, with approximately 519,000 beneficiaries.16 This was an increase over FY2005, when 337,000 households received cooling aid. Also in FY2006, HHS reported that 157,000 households received summer crisis assistance; it is not known to what extent these recipients overlapped with those receiving cooling assistance. In FY2006, nearly 125,000 households received weatherization assistance, up from 104,000 in FY2005.receiving assistance has hovered between 14% and 16%, settling at 16% for the last three fiscal years for which data are available (FY2006 through FY2008). The number of households receiving cooling and/or summer crisis assistance reached a high point of 700,000 recipients in both FY2002 and FY2006. However, in FY2007 and FY2008, cooling/summer crisis assistance nearly reached this level, with approximately 600,000 beneficiaries in each year.21 HHS estimates that of all households receiving LIHEAP heating assistance, about 31% had at least one member 60 years of age or older; about 30% had at least one member with a disability; and some 21% included at least one child five years of age or younger. 1722 Benefit Levels In FY2006, the constant dollar value of the average LIHEAP heating and winter crisis benefit increased more than thirty dollars from the previous year, FY2005. Measured in constant 1981 dollars (the year in which LIHEAP was enacted), the average LIHEAP benefit per household in FY2006 was $171, up from $140.18 The general trend in the constant dollar value of LIHEAP benefits since the program’s beginning has been a decline. In FY1983, the average heating and winter crisis benefit, measured in constant 1981 dollars, was $209. By FY1998, it had declined to $117, and although the average benefit reached $187 in FY2001, it declined again thereafter, and in FY2005 the average constant dollar benefit was $140. (See Table 3.) LIHEAP also covers a smaller portion of home heating bills than in earlier years. In FY2006, the LIHEAP benefit covered 10% of the combined home heating costs of all households federally eligible for LIHEAP, compared to 23% in 1981.19 (This estimate includes the heating costs of households that were eligible for LIHEAP based on the federal guidelines, but did not receive LIHEAP assistance.) Between FY1990 and FY2006, the percentage of home heating bills covered has ranged between 8% and 15% compared to the 18% to 19% range covered in the 1980s. 16 17 Ibid., p. 20. Ibid., pp. 23. 18 U.S. Department of Health and Human Services, Administration for Children and Families, LIHEAP Home Energy Notebook for Fiscal Year 2006, August 2008, p. 32 (hereinafter FY2006 LIHEAP Home Energy Notebook). 19 Ibid., p. 33. Congressional Research Service 8 The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding The constant dollar value of the cooling and summer crisis benefit, which is available to a more limited number of households in far fewer states, has largely risen in recent years. While the average benefit in 1981 was $129, in the years that followed, the average benefit in constant 1981 dollars declined as low as $57 in FY1983, and $49 in FY1990. However, from FY1990 levels the average benefit grew, and by FY2000 and FY2001, the average benefit had reached $107. After a recent decline in FY2004 and FY2005 when the average cooling or summer crisis benefit had dropped to $91, in FY2006, the average benefit was $105.20 Apart from federal funding levels, a variety of factors help determine to what extent LIHEAP is able to meet its stated goal of assisting low-income households in meeting their home energy needs. 21 These include the following: • the cost of energy for a given household (influenced by energy price fluctuations and variation in kinds of fuels used); • the amount of energy consumed (influenced by severity of the weather, energy efficiency of housing, and expected standards of comfort); and • the number of eligible households (influenced by population size and health of the economy). Table 2. LIHEAP Heating/Winter Crisis Aid, Selected Years Fiscal Years 1983 1990 1993 1998 1999 2000 2001 2002 2003 2004 2005 2006 Households Number receiving aid (millions) 6.8 5.8 5.6 3.9 3.6 3.9 4.8 4.4 4.8 5.0 5.3 5.5 Number federally eligible (millions) 22.2 25.4 28.4 29.1 29.0 29.4 30.4 32.7 34.5 35.4 34.8 34.4 Federally eligible and receiving aid 31% 23% 20% 13% 12% 13% 16% 13% 14% 14% 15% 16% Average benefit (nominal $) $225 $209 $201 $213 $237 $270 $364 $291 $312 $277 $304 $385 Average benefit (constant 1981 $)a $209 $147 $129 $117 $128 $140 $187 $147 $154 $132 $140 $171 Benefit Levels 20 21 Ibid., p. 32. See also CRS Report RS20761, LIHEAP and Residential Energy Costs, by Bernard A. Gelb. Congressional Research Service 9 The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding Fiscal Years 1983 1990 1993 1998 1999 2000 2001 2002 2003 2004 2005 2006 11% 9% 9% 11% 14% 12% NAc 8% 8% 10% LIHEAP Coverage Portion of winter heating bill covered by LIHEAP (for all federally eligible households)b 18% 15% Source: Compiled by the Congressional Research Service (CRS) on the basis of information provided by or included in the U.S. Department of Health and Human Services, Administration for Children and Families, Office of Community Services, Division of Energy Assistance, LIHEAP Home Energy Assistance Notebooks and LIHEAP Reports to Congress for FY1998, FY2000, FY2001, FY2002, FY2003, FY2004, FY2005, and FY2006. a. The constant dollars are based on the 1981 value of the benefit (using the CPI-U index). b. These percentages represent the estimated portion of combined home heating costs for all households federally eligible for LIHEAP that was offset by LIHEAP heating/winter crisis assistance. c. HHS did not make FY2003 data for these trends available.Apart from federal funding levels, a variety of factors help determine to what extent LIHEAP is able to meet its stated goal of assisting low-income households in meeting their home energy needs. These include the following: • the cost of energy for a given household (influenced by energy price fluctuations and variation in kinds of fuels used); • the amount of energy consumed (influenced by severity of the weather, energy efficiency of housing, and expected standards of comfort); and • the number of eligible households (influenced by population size and health of the economy). 20 U.S. Department of Health and Human Services, Administration for Children and Families, LIHEAP Home Energy Notebook for Fiscal Year 2008, May 2010, p. 30 (hereinafter, FY2008 LIHEAP Home Energy Notebook). 21 See the FY2008 LIHEAP Home Energy Notebook, p. 30 and the FY2007 Home Energy Notebook, p. 30. 22 FY2006 LIHEAP Report to Congress, p. 23. Congressional Research Service 9 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding In FY2008, the constant dollar value of the average LIHEAP heating and winter crisis benefit increased by about $12 from the previous year, FY2007. Measured in constant 1981 dollars (the year in which LIHEAP was enacted), the average LIHEAP benefit per household in FY2008 was $151, up from $139.23 However, the general trend in the constant dollar value of LIHEAP benefits since the program’s beginning has been a decline. In FY1983, the average heating and winter crisis benefit, measured in constant 1981 dollars, was $209. By FY1998, it had declined to $117, and although the average benefit reached $187 in FY2001, it generally declined again thereafter, with the exception of $171 in FY2006, when funding was higher than in the immediately preceding and subsequent years. (See Table 2.) LIHEAP also covers a smaller portion of home heating bills than in earlier years. In FY2006 (the most recent year in which data are available), the LIHEAP benefit covered 42% of the heating costs of LIHEAP-recipient households, compared to 54% in 1981.24 Between FY1990 and FY2006, the percentage of home heating bills covered by the average LIHEAP benefit has ranged from 40% to 73%. The constant dollar value of the cooling and summer crisis benefit, which is available to a more limited number of households in far fewer states, has fluctuated over the years. While the average benefit in 1981 was $129, in the years that followed the average benefit in constant 1981 dollars declined as low as $57 in FY1983 and $49 in FY1990. However, the average benefit grew from FY1990 levels, and by FY2000 and FY2001 the average benefit had reached $107. In recent years, between FY2004 and FY2008, the constant dollar value has ranged from $91 (in FY2004 and FY2005) up to $105 in FY2006, and then down to $74 and $72 in FY2007 and FY2008 respectively. 25 23 FY2008 LIHEAP Home Energy Notebook, p. 32. FY2006 LIHEAP Report to Congress, p. 24. 25 For the most recent constant dollar value funding levels, see the FY2008 LIHEAP Home Energy Notebook, p. 32. 24 Congressional Research Service 10 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding Table 2. LIHEAP Heating/Winter Crisis Aid for Select Years Fiscal Years 1983 1990 1993 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 6.8 5.8 5.6 3.9 3.6 3.9 4.8 4.4 4.8 5.0 5.3 5.5 5.3 5.4 Number federally eligible (millions) 22.2 25.4 28.4 29.1 29.0 29.4 30.4 32.7 34.5 35.4 34.8 34.4 33.6 33.5 Federally eligible and receiving aid 31% 23% 20% 13% 12% 13% 16% 13% 14% 14% 15% 16% 16% 16% Households Number receiving aid (millions) Benefit Levels Average benefit (nominal $) $225 $209 $201 $213 $237 $270 $364 $291 $312 $277 $304 $385 $320 $362 Average benefit (constant 1981 $)a $209 $147 $129 $117 $128 $140 $187 $147 $154 $132 $140 $171 $139 $151 LIHEAP household heating expenditures 7.0% as a percentage of income 5.2% 7.1% 5.2% 5.2% 5.2% 7.4% 6.2% 8.6% 8.4% 9.4% 11.2% 6.5% 7.1% Percentage of heating costs offset by LIHEAP benefit 51% 49% —b —b 73% 68% 64% 48% 43% 40% —c —c LIHEAP Coverage 54% 42% Source: Data on the percentage of heating costs offset and the annual heating costs of LIHEAP households for FY1983, FY1990, and FY1993 come from the LIHEAP Reports to Congress for FY1983 through FY2006. Data regarding benefit levels, average heating expenditures, and annual heating expenditures for FY2000 to the present are drawn from the LIHEAP Home Energy Notebooks for FY1998 through FY2008. As of the date of this report, the FY2007 LIHEAP Report to Congress was not yet available. a. The constant dollars are based on the 1981 value of the benefit (using the CPI-U index). b. CRS does not have data for heating costs offset in FY1998 and FY1999. c. HHS has not yet released reports to Congress for FY2006 and FY2007. Congressional Research Service 11 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding Funds and Their Distribution The LIHEAP statute authorizes regular funds appropriations, which are allocated to all states on the basis of a statutory formula, and contingency fund appropriations, which are allocated to one or more states at the discretion of the Administration. The statute also authorizes a smaller amount of funds for incentive grants to states that leverage non-federal resources for their energy assistance programs. Regular Funds Regular funds are distributed to states according to a three-tier formula in the LIHEAP statute and based on the level of funds appropriated in a given fiscal year.2226 The three-tier formula is the result of changes to the LIHEAP statute in 1984 through the Human Services Reauthorization Act (P.L. 98-558). Prior to the changes in P.L. 98-558, LIHEAP allotments to the states were based largely on home heating needs with minimal consideration of cooling costs, and did not provide for the use of updated data, including population and energy costs. The new distribution formula provides that in determining state allotments the Department of Health and Human Services shall use “the most recent satisfactory data available” and consider home energy costs of low-income households (not simply all households, as was previously the case). These changes to the calculation of state allotments mean that some states will receive a smaller percentage share of regular funds, while some will receive a larger share. In order to 22 States are defined to include the District of Columbia. Indian tribes receive funds out of state allotments that are proportionate to their share of LIHEAP-eligible households in the state. Before state allotments are made, the statute provides that at least one-tenth (but not more than one-half) of 1% of the total appropriation must be set aside for energy assistance in American Samoa, Guam, the Northern Mariana Islands, Puerto Rico, and the U.S. Virgin Islands. Congressional Research Service 10 The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding offset the losses to certain states resulting from the formula change, and “prevent severe disruption to programs,”2327 Congress implemented two “hold harmless” provisions in P.L. 98-558 to prevent states from losing too much funding. This resulted in the three-tier current law formula, which is described in more detail below. Tier I The Tier I formula is used to allocate funds when the total LIHEAP regular fund appropriation is less than $1.975 billion. Neither hold harmless provision applies at the Tier I level, and HHS allocates funds according to the allotment percentages used under the pre-1984 formula. The old formula is used because the amount of appropriated funds required to trigger the new formula is $1.975 billion. The LIHEAP statute stipulates that for FY1986 and succeeding years, no state shall receive less money than it would have received in FY1984 had the LIHEAP funding in that year been $1.975 billion. 2428 According to HHS, then, the LIHEAP statute requires use of the old allotment percentages when funding is less than $1.975 billion.25 Until FY2006, funding levels 29 Until FY2006, funding levels 26 States are defined to include the District of Columbia. Indian tribes receive funds out of state allotments that are proportionate to their share of LIHEAP-eligible households in the state. Before state allotments are made, the statute provides that at least one-tenth (but not more than one-half) of 1% of the total appropriation must be set aside for energy assistance in American Samoa, Guam, the Northern Mariana Islands, Puerto Rico, and the U.S. Virgin Islands. 27 Report of the Committee on Energy and Commerce (H.Rept. 98-139, Part 2), to accompany H.R. 2439, May 15, 1984, p. 13. 28 42 U.S.C. § 8623(a)(2)(A). 29 U.S. Department of Health and Human Services, Low Income Home Energy Assistance Program: Report to Congress for FY1987, p. 133. The statutory provision that provides for use of the old formula is 42 U.S.C. § 8623(a)(3). Congressional Research Service 12 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding for LIHEAP only twice exceeded the $1.975 billion level, in FY1985 and FY1986. Thus, from FY1987 through FY2005, states continued to receive the same allotment percentages they received under the previous LIHEAP formula. Tier II For appropriations above $1.975 billion and up to $2.25 billion, the Tier II rate applies, and HHS uses the formula enacted in 1984 to calculate state allotments. Under the Tier II formula, a hold harmless level applies, and no state may receive less funding than it would have received under the Tier I distribution rate as it was in effect for FY1984, assuming a $1.975 billion appropriation.2630 State allotment percentages may be different, however. To ensure that states receive their hold harmless levels of funding, those states that gain the most funding under the new formula must have their percentage share of funds ratably reduced to bring other states up to the hold harmless level. 2731 Tier III The Tier III formula applies to funding levels at or above $2.25 billion. The Tier III rate uses the Tier II methodology to distribute funds, but adds a second hold-harmless requirement, a hold harmless rate. States that would receive less than 1% of a $2.25 billion appropriation must have their funds allocated using the rate that would have been used at a hypothetical $2.14 billion 23 Report of the Committee on Energy and Commerce (H.Rept. 98-139, Part 2), to accompany H.R. 2439, May 15, 1984, p. 13. 24 42 U.S.C. §8623(a)(2)(A). 25 U.S. Department of Health and Human Services, Low Income Home Energy Assistance Program: Report to Congress for FY1987, p. 133. The statutory provision that provides for use of the old formula is 42 U.S.C. §8623(a)(3). 26 Since this language was enacted, Congress further provided that HHS could use regular LIHEAP funds appropriations for Training and Technical Assistance (P.L. 99-425). It also authorized Leveraging Incentive Grants (P.L. 101-501) and the REACH option (P.L. 103-252)—both of which it generally funds out of regular LIHEAP funds. These debits on the regular funds account were not in place for FY1984. Because they affect the level of regular funds available for state grant allotments by a little more than $25 million, it is possible but not certain that HHS would not implement the newer formula before a regular funds appropriation level of approximately $2.0028 billion. 27 42 U.S.C. §8623(a)(3). Congressional Research Service 11 The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding appropriation (if this rate is greater than the calculated rate at $2.25 billion). In both the Tier II and Tier III rates, a state will not be allocated less funds than the state received under the Tier I distribution as it was in effect in FY1984 (had the appropriation level been $1.975 billion). Contingency Funds The statute currently provides an annual authorization of $600 million for LIHEAP contingency funds (contingency funds are authorized indefinitely).2832 Appropriated contingency funds may only be released at the discretion of HHS and may be allocated to one or more states according to their needs. The statute authorizes the appropriation of contingency funds “to meet the additional home energy assistance needs of one or more states arising from a natural disaster or other emergency.” The term “emergency” is defined in the LIHEAP statute to include a natural disaster; a significant home energy supply shortage or disruption; significant increases in the cost of home energy, home energy disconnections, participation in public benefit programs, or unemployment; or an “event meeting such criteria as the [HHS] Secretary may determine to be appropriate.” 30 Since this language was enacted, Congress further provided that HHS could use regular LIHEAP funds appropriations for Training and Technical Assistance (P.L. 99-425). It also authorized Leveraging Incentive Grants (P.L. 101-501) and the REACH option (P.L. 103-252)—both of which it generally funds out of regular LIHEAP funds. These debits on the regular funds account were not in place for FY1984. Because they affect the level of regular funds available for state grant allotments by a little more than $25 million, it is possible but not certain that HHS would not implement the newer formula before a regular funds appropriation level of approximately $2.0028 billion. 31 42 U.S.C. § 8623(a)(3). 32 42 U.S.C. § 8621(e). Congressional Research Service 13 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding Leveraging Incentive and REACH Funds In 1990, P.L. 101-501 amended the program statute to provide a separate funding authorization of $50 million ($30 million if regular funds appropriated are under $1.4 billion) for incentive grants to states that leverage non-federal resources for their LIHEAP programs.2933 Such resources might include negotiated lower energy rates for low-income households or separate state funds. States are awarded incentive funds in a given fiscal year on the basis of a formula that takes into account their previous fiscal year success in securing non-federal resources for their energy assistance program. In 1994 (P.L. 103-252) the statute was further amended to provide that of any incentive funds appropriated, up to 25% may be set aside for the Residential Energy Assistance Challenge Option (REACH). Under the REACH option states may be awarded competitive grants for their efforts to increase efficiency of energy usage among low-income families and to reduce those families’ vulnerability to homelessness and other health and safety risks due to high energy costs. The funding authorization for Leveraging Incentive and REACH grants is separate from regular funds, and the programs were not reauthorized in P.L. 109-58. In practice, however, Congress has funded these initiatives at $22 million to $30 million with dollars set-aside out of annual regular fund appropriations. Other Funds States are allowed to carry over unused funds from a previous fiscal year (limited to 10% of funds awarded a state). A diminishing amount of money may also be available from previously settled claims of price control violation by oil companies. 3034 In addition, the Social Services Block Grant program allows states to transfer up to 10% of funds to provide low-income home energy 28 42 U.S.C. §8621(e). 42 U.S.C. §8621(d). 30 FY2004 LIHEAP Report to Congress, p. 11. For FY2004, $2 million in oil overcharge funds was available to one state. 29 Congressional Research Service 12 The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding assistance, 3135 while the Temporary Assistance for Needy Families program gives states the discretion to use funds for home heating and cooling costs.3236 Legislative History Since it was created by the Low Income Home Energy Assistance Act of 1981 (Title XXVI of P.L. 97-35), the LIHEAP program has been reauthorized or amended seven times. The legislation and some of the significant changes made are briefly discussed in the following paragraphs. In 1984, P.L. 98-558, established a new formula by which regular LIHEAP funds are to be distributed in every year (after FY1985) in which regular appropriations exceed $1.975 billion. This level of funding was exceeded in FY1986 and again in FY2006. In 1986, P.L. 99-425 extended the program with few changes. In 1990, P.L. 101-501 created the Incentive Program for Leveraging Non-Federal Resources and authorized a July to June program year (or forward funding) for LIHEAP to allow state program directors to plan for the fall/winter heating season with knowledge of available money. This program year language was 33 42 U.S.C. § 8621(d). FY2004 LIHEAP Report to Congress, p. 11. For FY2004, $2 million in oil overcharge funds was available to one state. 35 42 U.S.C. § 1397a(d). 36 42 U.S.C. § 604(a)(1). 34 Congressional Research Service 14 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding subsequently removed, although the statute now states that money appropriated in a given fiscal year is to be made available for obligation in the following fiscal year. Congress last provided advance appropriations for LIHEAP in the FY2000 appropriations cycle. In 1993, P.L. 103-43 extended the authorization of LIHEAP for one year but made no other changes. In 1994 (P.L. 103-252) Congress stipulated that LIHEAP benefits and outreach activities target households with the greatest home energy needs (and costs), and it enacted a separate and permanent contingency funding authorization of $600 million for each fiscal year. The 1994 law also established the competitive REACH grant option. In 1998, P.L. 105-285 authorized annual regular funding for each of FY2002-FY2004 at $2 billion and made explicit a wide variety of situations under which HHS is authorized to release LIHEAP contingency funds. In 2005, the Energy Policy Act (P.L. 109-58) reauthorized the program and raised the LIHEAP regular funds authorization level for FY2005 through FY2007 to $5.1 billion. It also explicitly permitted the purchase of renewable fuels as part of providing LIHEAP assistance; required the Department of Energy to report on use of renewable fuels in provision of LIHEAP aid; and required HHS to report (within one year of the legislation’s enactment) on ways that the program could more effectively prevent loss of life due to extreme temperatures. The law also allowed the Secretary of the Interior, when disposing of royalty-in-kind oil and gas taken as payment from lessees using federal land, to grant a preference for the purpose of providing additional resources to support federal low-income energy assistance programs. (Lessees of federal land may pay royalties to the U.S. government in oil and natural gas rather than cash payments.) However, the Government Accountability Office issued a decision determining that the law did not give the Interior Department sufficient authority to grant such a preference. 3337 Because of a provision in 31 32 42 U.S.C. §1397a(d). 42 U.S.C. §604(a)(1). 33 existing law that the Interior Department cannot sell oil and gas obtained as in-kind royalties for less than market price,38 the provision in P.L. 109-58 does not allow a price preference. 37 U.S. Government Accountability Office, Department of Interior—Royalty-in-Kind Oil and Gas Preferences, B307767, November 13, 2006, available at http://www.gao.gov/decisions/appro/307767.pdf. 38 42 U.S.C. § 15902(b)(3)(A). Congressional Research Service 1315 The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding existing law that the Interior Department cannot sell oil and gas obtained as in-kind royalties for less than market price,34 the provision in P.L. 109-58 does not allow a price preference. Table 3. LIHEAP Funding by State, FY2006 to FY2009 (Funding Shown for Each State Does Not Include Distributions to Tribes) (dollars in millions) Total Funds Distributeda (Regular and Contingency) State FY2006 FY2007 Regular Allotment FY2008 Contingency Distributed Total FY2009 Alabama 31.787 22.077 19.090 59.649 4.182 63.832 Alaska 12.839 8.631 11.681 16.333 5.100 21.433 Arizona 14.230 7.856 8.591 26.844 1.882 28.726 Arkansas 23.336 15.749 14.667 36.497 3.213 39.711 California 156.441 94.089 102.250 223.989 22.402 246.391 Colorado 44.806 33.073 41.326 63.474 7.877 71.352 Connecticut 71.106 48.102 65.618 95.783 30.104 125.887 Delaware 10.954 5.727 6.929 17.384 1.364 18.748 District of Columbia 8.165 6.700 7.284 14.653 1.596 16.249 Florida 49.785 27.970 30.406 95.013 6.662 101.675 Georgia 40.026 28.564 24.047 75.141 5.269 80.410 Hawaii 2.567 2.228 2.403 4.652 0.531 5.182 Idaho 14.055 12.275 13.241 25.632 2.924 28.556 Illinois 193.814 119.418 149.216 237.236 28.443 265.679 Indiana 75.327 54.062 67.552 103.602 12.877 116.479 Iowa 52.054 38.319 47.881 67.803 9.127 76.929 Kansas 27.709 19.727 22.083 45.308 4.188 49.496 Kentucky 45.320 32.010 30.588 68.353 6.702 75.055 Louisiana 32.671 22.499 19.651 57.196 4.305 61.502 Maine 43.496 32.487 44.835 47.649 28.644 76.293 Maryland 61.889 33.036 35.913 101.296 7.868 109.164 Massachusetts 126.425 93.757 126.442 162.916 50.499 213.414 Michigan 153.615 112.509 140.589 221.244 26.862 248.106 Minnesota 110.849 81.681 102.063 144.528 19.455 163.982 Mississippi 27.415 17.838 16.448 38.937 3.604 42.541 Missouri 78.220 52.645 59.603 103.541 11.361 114.902 Montana 19.259 12.487 15.602 26.075 2.974 29.049 34 42 U.S.C. §15902(b)(3)(A). Congressional Research Service 14 The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding Total Funds Distributeda (Regular and Contingency) State FY2006 Nebraska FY2007 Regular Allotment FY2008 Contingency Distributed Total FY2009 28.634 18.940 23.660 39.558 4.512 44.070 7.247 4.016 4.366 13.643 0.957 14.599 27.740 18.769 25.635 34.112 13.624 47.737 New Jersey 114.759 79.920 108.707 166.690 19.083 185.773 New Mexico 11.555 9.867 10.711 22.919 2.347 25.266 381.719 261.178 359.046 475.409 62.240 537.649 North Carolina 71.125 45.156 41.629 121.051 9.121 130.172 North Dakota 19.272 13.446 16.426 27.299 3.114 30.413 164.226 105.643 132.004 220.588 25.162 245.750 Oklahoma 26.921 17.517 16.048 44.572 3.521 48.092 Oregon 24.575 25.035 27.010 44.640 6.009 50.650 Pennsylvania 202.324 140.520 191.759 274.925 33.469 308.394 Rhode Island 23.066 15.428 20.816 30.123 8.420 38.544 South Carolina 25.279 17.636 15.266 47.702 3.345 51.047 South Dakota 16.540 10.977 13.715 22.921 2.614 25.536 Tennessee 47.139 33.568 30.985 73.723 6.789 80.512 Texas 84.005 46.545 50.599 158.110 11.086 169.196 Utah 22.848 15.062 18.823 31.646 3.609 35.255 Vermont 20.903 14.162 19.370 25.568 10.587 36.156 Virginia 75.053 40.241 43.746 118.084 9.585 127.668 Washington 39.631 40.443 43.626 71.568 9.634 81.201 West Virginia 24.543 18.621 20.157 40.584 4.435 45.019 Wisconsin 99.837 73.525 91.872 130.096 17.512 147.608 Wyoming 8.987 5.932 7.415 12.640 1.442 14.081 Subtotal 3,096 2,108 2,559 4,428.898 582.230 5,011.128 Tribesb 32.897 23.201 27.983 47.403 7.434 54.837 3.456 2.788 3.014 6.070 0.664 6.734 27.225 27.225 —f 27.000 — 27.000 Training/Tech. Asst.e 0.297 0.297 0.292 0.300 — 0.300 Total 3,160 2,161 2,591 4,509.672 590.328 5,100 Nevada New Hampshire New York Ohio Territoriesc Leveraging/REACHd Source: Compiled by the Congressional Research Service (CRS) using U.S. Department of Health and Human Services (HHS) data. a. The totals shown in these columns include regular fund allocations to states (net of the direct awards to tribes) and any contingency funds awarded to the state in that year. Congressional Research Service 15 The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding b. This funding is made directly available to or for tribes but is reserved out of a given state’s allotment amount. As prescribed in the statute, the tribal set-aside from a state gross allotment is based on tribal households in that state. c. The statute provides that HHS must set-aside not less then one-tenth of 1% and not more than one-half of 1% for use in the territories (American Samoa, Guam, Puerto Rico, Northern Mariana Islands, and the U.S. Virgin Islands). d Income Home Energy Assistance Program (LIHEAP): Program and Funding Appendix. Tables Showing LIHEAP Funding Levels In this Appendix are four tables that show how LIHEAP funds have been distributed to the states, tribes, and territories during the last several fiscal years, as well as historical funding levels from the time the program was created to the present. Table A-1 shows how LIHEAP regular funds have been distributed thus far under a series of FY2011 Continuing Resolutions (CRs). The table shows net funding to the states, which means that funds provided to tribes (if any) within each state are not included in the total. Instead, a separate row at the end of the table shows the total amount of funds distributed to all tribes that choose to receive LIHEAP funds separately. This is due to the fact that HHS did not provide a separate breakout of tribal funding by state for the two FY2011 LIHEAP distributions shown in columns (b) and (c). For a more comprehensive discussion of FY2011 funding levels, see the section of this report entitled “LIHEAP Funding Under the FY2011 Continuing Resolutions.” • Column (a) of Table A-1 shows the amount of regular funds that states received in FY2010 for comparison purposes. • Column (b) shows the amount of funds that states received under the first three Continuing Resolutions (P.L. 111-242, P.L. 111-290, and P.L. 111-317). Initially, states were eligible to receive up to 75% of their allocation at a total funding level of $2.7 billion. However, in mid-December HHS allowed states to receive 100% of their allocation at $2.7 billion if they chose. Column (b) shows this latter funding level. • The fourth Continuing Resolution (P.L. 111-322) directs that HHS obligate to states the same amount of funds that were obligated in FY2010 through the date of the CR. So the amounts states receive depend on the percentage that each requested during the first two quarters of FY2010. Column (c) shows the amounts that HHS distributed to states under the terms of the fourth CR. Table A-2 provides a specific breakdown of LIHEAP funds distributed in FY2010. • In column (a), the first number shows the total amount of regular funds distributed to each state and the tribes within the state, while the second number, in parenthesis and italics, breaks out the amount set aside for tribes within each state. Tribes may operate their own LIHEAP programs if they wish. Their allotments are taken from the state’s award of LIHEAP regular and contingency funds based on the number of LIHEAP-eligible households in the tribe. Not all states have funds set aside for tribes. • Columns (b) and (c) show the two January 2010 contingency fund distributions of $450 million and $40 million; in columns (b) and (c), tribal funds are not broken out separately because HHS did not make the separate breakdowns available. • In column (d), the first number shows the total amount of contingency funds distributed to states and tribes in January 2010 ($490 million), while the second number, in parenthesis and italics, breaks out the total amount of contingency funds (from both January distributions) set aside for tribes in each state. Congressional Research Service 16 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding • Column (e) shows the total amount of contingency funds distributed to states and tribes in September 2010—approximately $101 million. As of the date of this report, HHS had not released a breakdown of funds between states and tribes. • Column (f) shows total funds, regular and contingency, distributed to the states in FY2010. • Finally, allocations to the territories are in the next-to-last row, after the states. Table A-3 shows the total amount of LIHEAP regular and contingency funds distributed to each state from FY2006 through FY2010; the totals include funds distributed to tribes within the states. Table A-4 provides historic funding levels for LIHEAP from the time the program was initially funded, in FY1982, through FY2011. The table shows authorization levels for LIHEAP regular funds, Administration budget requests for both regular and contingency funds, the total amount of regular and contingency funds appropriated in each fiscal year, and the total amount of contingency funds distributed. Congressional Research Service 17 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding Table A-1. Net State LIHEAP Formula Grant Funding (Less Tribes) Under the FY2011 Continuing Resolutions (CRs) (dollars in millions) FY2010 Formula Funding: $4.5 Billion (a) FY2011 Formula Funding Under the First Three CRs: $2.7 Billion (b) FY2011 Formula Funding Under the Fourth CR: Based on Obligations Through 3/4/10 (c) Alabama 58.394 18.471 51.908 Alaska 16.293 4.196 13.670 Arizona 31.171 4.903 15.393 Arkansas 35.773 15.692 35.333 California 201.024 118.597 118.597 Colorado 64.257 31.488 50.773 Connecticut 96.942 38.795 95.749 Delaware 15.189 7.839 13.502 District of Columbia 13.992 8.108 13.820 Florida 110.326 62.470 98.071 Georgia 87.252 49.405 86.178 Hawaii 6.023 0.981 3.026 Idaho 25.632 8.912 22.785 Illinois 232.865 135.916 229.999 Indiana 104.144 40.034 82.290 Iowa 67.803 36.483 66.968 Kansas 41.678 26.248 41.165 Kentucky 57.742 30.478 57.032 Louisiana 51.870 32.018 46.109 Maine 52.324 28.668 51.680 Maryland 82.002 41.074 76.943 Massachusetts 175.454 100.529 173.294 Michigan 232.323 84.245 183.570 Minnesota 144.528 86.408 142.749 Mississippi 39.586 22.250 39.098 Missouri 95.257 32.703 70.563 Montana 26.075 12.844 25.754 Nebraska 39.533 20.603 39.046 Nevada 15.841 9.967 15.646 New Hampshire 34.112 19.768 33.692 177.196 109.542 175.015 State New Jersey Congressional Research Service 18 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding FY2010 Formula Funding: $4.5 Billion (a) FY2011 Formula Funding Under the First Three CRs: $2.7 Billion (b) FY2011 Formula Funding Under the Fourth CR: Based on Obligations Through 3/4/10 (c) 20.575 11.923 20.322 New York 479.270 276.595 473.102 North Carolina 107.395 72.422 72.422 North Dakota 27.299 15.595 26.963 223.108 99.575 110.181 Oklahoma 43.484 26.064 38.692 Oregon 44.640 23.876 44.091 Pennsylvania 282.279 135.631 267.652 Rhode Island 29.582 12.857 29.217 South Carolina 47.311 16.289 23.364 South Dakota 22.921 11.955 22.187 Tennessee 72.092 40.787 40.787 Texas 183.593 98.181 181.333 Utah 31.596 10.962 28.086 Vermont 25.568 14.372 22.728 100.856 22.936 75.707 Washington 71.568 42.784 70.687 West Virginia 38.884 18.026 38.405 Wisconsin 130.096 77.780 128.494 Wyoming 12.527 6.490 12.372 4,427.245 2,220.418 3,896.213 49.057 30.085 48.776 6.070 3.633 5.573 4,482.372 2,254.136 3,950.562 State New Mexico Ohio Virginia Subtotal to states Tribes Territories Total Source: Funding levels for FY2010 and under the Continuing Resolutions for FY2011 are from the U.S. Department of Health and Human Services (HHS), Administration for Children and Families. Congressional Research Service 19 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding Table A-2. FY2010 LIHEAP Regular and Contingency Fund Allotments to States,Tribes, and Territories (dollars in millions) Contingency Funds Regular Funds Total State & Tribal Regular Fund Allotments $4.48 Billion (tribal set-aside, if any)b (a) State January 2010: Two Contingency Fund Distributions to States & Tribes (tribes not broken out separately) January 2010: Breakdown of State & Tribal Contingency Funds September 2010: State & Tribal Contingency Fundsa $450 Millionc (b) $40 Milliond (c) $490 Million (tribal set-aside, if any) (d) $101 Millione (e) 2.639 Alabama 58.799 (0.340) 6.714 Alaska 25.308 (9.025) Arizona 33.729 (2.558) Arkansas 35.773 California 202.749 9.353 (0.064) 0.865 69.016 2.322 2.322 (0.828) 0.552 28.182 3.275 3.275 (0.248) 0.418 37.422 0.660 40.000 4.639 234.215 Colorado 2.825 0.743 3.568 26.827 26.827 64.257 4.800 4.800 1.617 70.675 Connecticut 96.942 8.793 8.793 2.110 107.845 Delaware 15.189 1.378 1.378 0.280 16.847 District of Columbia 13.992 1.747 1.747 0.328 16.067 1.368 129.014 Florida 110.354 Georgia (1.720) Total Funds Distributed $5.073 Billion (f) 13.307 3.985 17.292 87.252 9.404 4.354 13.758 1.082 102.091 Hawaii 6.023 0.456 0.456 0.109 6.589 Idaho 26.939 2.587 2.587 0.631 30.158 Illinois 232.865 26.837 26.837 5.840 265.542 Indiana 104.151 10.780 10.780 2.644 117.575 4.848 4.848 1.874 74.524 0.861 46.262 Iowa 67.803 Kansas 41.757 Kentucky (0.028) (0.228) (1.307) (0.007) (0.079) (0.004) (0.126) (0.001) 2.941 0.703 3.644 57.742 6.716 1.998 8.714 1.376 67.832 Louisiana 51.870 3.985 2.314 6.299 0.884 59.054 Maine 54.309 1.367 60.428 Maryland 82.002 1.616 90.005 (1.985) 4.752 4.752 6.388 6.388 (0.007) (0.174) Massachusetts 175.524 (0.070) 16.857 16.857 (0.007) 4.221 196.602 Michigan 233.524 (1.202) 37.379 37.379 (0.192) 5.545 276.447 Minnesota 144.528 11.567 11.567 3.995 160.089 Mississippi 39.661 0.741 46.650 Missouri 95.257 2.333 107.145 (0.075) Congressional Research Service 4.021 9.555 2.228 6.248 9.555 (0.012) 20 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding Contingency Funds Regular Funds Total State & Tribal Regular Fund Allotments $4.48 Billion (tribal set-aside, if any)b (a) State January 2010: Two Contingency Fund Distributions to States & Tribes (tribes not broken out separately) January 2010: Breakdown of State & Tribal Contingency Funds September 2010: State & Tribal Contingency Fundsa $450 Millionc (b) $490 Million (tribal set-aside, if any) (d) $101 Millione (e) Montana 31.598 (5.524) 2.192 Nebraska 39.573 (0.040) 2.027 Nevada 15.841 2.181 New Hampshire 34.112 New Jersey 177.196 New Mexico 22.355 New York $40 Milliond (c) Total Funds Distributed $5.073 Billion (f) 2.192 (0.383) 0.740 34.530 2.393 (0.002) 0.927 42.893 2.181 0.196 18.218 2.512 2.512 0.799 37.423 18.341 18.341 3.918 199.455 (1.780) 1.861 1.861 (0.148) 0.524 24.739 479.526 (0.255) 45.029 45.029 (0.024) 12.794 537.348 North Carolina 109.339 (1.945) 12.601 15.893 (0.283) 1.907 127.139 North Dakota 34.325 (7.026) 1.538 1.538 (0.315) 0.804 36.668 24.760 24.760 5.166 253.035 Ohio 223.108 Oklahoma 47.902 (4.336) 3.578 Oregon 45.355 (0.715) 0.367 3.292 0.915 4.493 (0.414) 0.795 53.190 5.421 5.421 (0.085) 1.254 52.029 26.206 26.206 6.872 315.357 4.084 4.084 0.695 34.444 0.687 56.232 0.653 29.989 Pennsylvania 282.279 Rhode Island 29.666 South Carolina 47.311 South Dakota 27.878 Tennessee 72.092 8.001 3.412 11.413 1.394 84.899 Texas 183.593 16.065 10.873 26.938 2.276 212.807 Utah 32.094 0.752 35.003 Vermont Virginia (0.084) 6.058 (4.957) (0.499) 2.176 1.458 (0.012) 8.234 1.458 (0.259) 2.158 2.158 25.568 1.773 1.773 0.599 27.941 100.856 7.103 7.103 1.968 109.927 7.324 7.324 2.062 83.989 Washington 74.603 West Virginia 38.884 3.568 3.568 0.911 43.363 Wisconsin 130.096 11.522 11.522 3.596 145.214 Wyoming 12.850 (0.210) 0.974 0.974 (0.219) 0.301 14.124 4,476.302 (48.800) 449.391 40.000 489.391 (4.367) 100.542 5,066.234 6.070 0.609 — 0.609 0.136 6.816 4,482.372 450.000 40.000 490.000 100.678 5,073.050 Subtotal to States and Tribes Territories Total (3.035) (0.034) Congressional Research Service (0.298) 21 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding Source: Compiled by the Congressional Research Service (CRS) using U.S. Department of Health and Human Services (HHS) data. a. As of the date of this report, CRS had not received a breakout of tribal emergency contingency funds. b. Tribes may operate their own LIHEAP programs if they wish. Their allotments are taken from the state’s award of LIHEAP regular and contingency funds based on the number of LIHEAP-eligible household in the tribe. In columns (a) and (d) of this table, the first number represents the total amount of regular or contingency funds awarded to each state, including any amounts for tribes, while the number in parenthesis is the total amount allotted to a tribe or tribes within the state. c. In January 2010, HHS awarded $450 million in contingency funds to all states, tribes, and territories based on their share of FY2010 formula grants weighted by the unemployment rate. d. In January 2010, HHS awarded $40 million in contingency funds to 14 states where the number of heating degree days (HDDs) from November 1, 2009, through January 9, 2010, exceeded the 30-year norm by at least 5%. These states then received amounts based on the ratio of the product of total HDDs, the number of households at or below 125% of poverty, and the unemployment rate to the sum of the products for all 14 states. e. In September 2010, HHS awarded $101 million to all states, tribes, and territories based on the proportions of the “old” LIHEAP formula. Congressional Research Service 22 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding Table A-3. LIHEAP Funding by State FY2006 to FY2010 (dollars in millions) State (includes tribal allotments) Total Funds Distributeda (regular and contingency) FY2006 FY2007 FY2008 FY2009 FY2010 Alabama 31.972 22.205 19.221 64.274 69.016 Alaska 18.473 12.454 16.856 30.928 28.182 Arizona 15.399 8.551 9.296 31.084 37.422 Arkansas 23.336 15.749 14.667 39.711 40.000 California 157.626 94.855 103.117 248.487 234.215 Colorado 44.842 33.073 41.326 71.352 70.675 Connecticut 71.106 48.102 65.618 125.887 107.845 Delaware 10.954 5.727 6.929 18.748 16.847 8.165 6.700 7.284 16.249 16.067 Florida 49.798 27.977 30.414 101.701 129.014 Georgia 40.026 28.564 24.047 80.410 102.091 Hawaii 2.567 2.228 2.403 5.182 6.589 Idaho 14.772 12.901 13.916 30.012 30.158 Illinois 193.814 119.418 149.216 265.679 265.542 Indiana 75.336 54.069 67.561 116.487 117.575 Iowa 52.054 38.319 47.881 76.929 74.524 Kansas 27.722 19.746 22.137 49.541 46.262 Kentucky 45.320 32.010 30.588 75.055 67.832 Louisiana 32.671 22.499 19.651 61.502 59.054 Maine 45.146 33.719 46.536 79.187 60.428 Maryland 61.889 33.036 35.913 109.164 90.005 Massachusetts 126.476 93.795 126.492 213.500 196.602 Michigan 154.671 113.377 141.667 249.416 276.447 Minnesota 110.849 81.681 102.063 163.982 160.089 Mississippi 27.467 17.871 16.479 42.622 46.650 Missouri 78.220 52.645 59.603 114.902 107.145 Montana 22.789 15.132 18.907 35.202 34.530 Nebraska 28.643 18.950 23.679 44.086 42.893 7.247 4.016 4.366 14.599 18.218 27.740 18.769 25.635 47.737 37.423 New Jersey 115.046 80.120 108.707 185.773 199.455 New Mexico 12.491 10.705 11.638 27.451 24.739 District of Columbia Nevada New Hampshire Congressional Research Service 23 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding State (includes tribal allotments) Total Funds Distributeda (regular and contingency) FY2006 FY2007 FY2008 FY2009 FY2010 382.251 261.604 359.628 538.243 537.348 North Carolina 72.413 45.974 42.383 132.528 127.139 North Dakota 24.680 16.438 20.539 38.240 36.668 164.226 105.643 132.004 245.750 253.035 Oklahoma 29.543 19.282 17.668 52.878 53.190 Oregon 25.116 25.633 27.650 51.460 52.029 Pennsylvania 202.324 140.520 191.759 308.394 315.357 Rhode Island 23.131 15.471 20.875 38.653 34.444 South Carolina 25.279 17.636 15.266 51.047 56.232 South Dakota 20.117 13.350 16.681 31.058 29.989 Tennessee 47.139 33.568 30.985 80.512 84.899 Texas 84.005 46.545 50.599 169.196 212.807 Utah 23.285 15.369 19.204 35.755 35.003 Vermont 20.903 14.162 19.370 36.156 27.941 Virginia 75.053 40.241 43.746 127.668 109.927 Washington 41.226 42.163 45.481 84.645 83.989 West Virginia 24.543 18.621 20.157 45.019 43.363 Wisconsin 99.837 73.525 91.872 147.608 145.214 Wyoming 9.284 6.153 7.689 14.315 14.124 3,128.981 2,130.860 2,587.373 5,065.966 5,066.234 3.456 2.788 3.014 6.734 6.816 Leveraging/REACHc 27.225 27.225 —d 27.000 27.000 Training/tech. asst.e 0.297 0.297 0.292 0.300 0.300 Total 3,160 2,161 2,591 5,100 5,100.350 New York Ohio Subtotal to states and tribes Territoriesb Source: Compiled by the Congressional Research Service (CRS) using U.S. Department of Health and Human Services (HHS) data. a. The totals shown in these columns include regular fund allocations to states and tribes, and any contingency funds awarded to states and tribes in that year. b. The statute provides that HHS must set aside not less then one-tenth of 1% and not more than one-half of 1% for use in the territories (American Samoa, Guam, Puerto Rico, Northern Mariana Islands, and the U.S. Virgin Islands). c. The statute provides a separate funding authorization for competitive grants under the leveraging incentive program (designed to encourage states to increase non-federal support for energy assistance). It also provides that up to 25% of any leveraging funds made available may be reserved for competitive REACH grants (for state efforts to increase efficient use of energy among low-income households and to reduce their vulnerability to homelessness and other problems due to high energy costs). Congress has in recent years stipulated that a certain portion of the LIHEAP regular funds be set aside for leveraging grants and, of this amount, HHS has reserved 25% for REACH grants. Congressional Research Service 24 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding d. The FY2008 Consolidated Appropriations Act (P.L. 110-161) did not specify funds for leveraging incentive and REACH grants. e. The statute provides that HHS may reserve up to $300,000 for making grants or entering into contracts with states, public agencies, or private nonprofits that provide training and technical assistance related to achieving the purposes of the LIHEAP program. f. The FY2008 Appropriations Act (P.L. 110-161) did not specify funds for leveraging incentive and REACH grants. Table Congressional Research Service 25 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding Table A-4. LIHEAP Funding: FY1982 to FY2010FY2011 (dollars in thousands) Regular FundsaFunds Contingency Fundsa Fiscal Year Authorized President’s Request Authorized Appropriated President’s Request Appropriated Distributed Total Distributed 1982 1,400875,000 1,875400,000 1,875,000 — — — 1,875,000 1983 1,300875,000 1,875300,000 1,975,000 — — — 1,975,000 1984 1,300875,000 1,875300,000 2,075,000 — — — 2,075,000 1985 1,875,000 2,1402,140,000 1,875,000 2,100,000 — — — 2,100,000 1986 2,097,765 2,275,000275,000 2,097,765 2,100,000 — — — 2,100,000 1987 2,097,642 2,050,000050,000 2,097,642 1,825,000 — — — 1,825,000 1988 1,237,000 2,1322,132,000 1,237,000 1,531,840 — — — 1,531,840 1989 1,187,000 2,2182,218,000 1,187,000 1,383,200 — — — 1,383,200 1990 1,100,000 2,3072,307,000 1,100,000 1,443,000 — — — 1,443,000 1991 1,050,000 2,1502,150,000 1,050,000 1,415,055 NAb 195,180 195,180 1,610,235 1992 925,000 2,2302,230,000 925,000 1,500,000 100,000 300,000 0 1,500,000 1993 ssanc 1,065,000 ssanb 1,346,030 0 595,200 0 1,346,030 1994 ssanc 1,507,408 ssanb 1,437,402 0 600,000 300,000 1,737,402 1995 1,475,000 2,0002,000,000 1,475,000 1,319,202 d 600,000 100,000 1,419,202 1996 1,319,204 2,000,0002,000,000 1,319,204 900,000 e 180,000 180,000 1,080,000 1997 12,000,000 21,000,000 1,000,000 300,000 420,000 215,000 1,215,000 1998 12,000,000 21,000,000 1,000,000 300,000 300,000 160,000 1,160,000 1999 12,000,000 21,000,000 1,100,000 300,000 300,000 175,299 1,275,299 2000 ssanc 1,100,000 ssanb 1,100,000 300,000 900,000 744,350c 1,844350c Congressional Research Service 16 The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding Regular Fundsa Contingency Fundsa Fiscal Year President’s Request Authorized Appropriated Appropriated Distributed Total Distributed 2001 1,100,000 ssanb 1,400,000 600,000 455,650 1,855,650 1,800,000 2002 1,400,000 2,000,000 1,700,000 300,000 100,000d 2003 1,400,000 2,000,000 1,788,300e 0 200,000f 1,988,300 2004 1,700,000 2,000,000 1,789,380 99,410 99,410 1,888,790 2005 1,900,500g,h 5,100,000 1,884,799 297,600 277,250 2,162,050 2006 1,800,000g 5,100,000 2,480,000 681,000 679,960 3,160,000 2007 1,782,000 5,100,000 1,980,000 181,000 181,000 2,161,000 2008 1,500,000 —i 1,980,000 590,328 610,678j 2,590,678 2009 1,700,000 —i 4,509,672 590,328 590,328 5,100,000 2010 2,410,000k — —350f 1,844350f 2001 ssanc 1,100,000 1,400,000 300,000 600,000g 455,650h 1,855,650 2002 2,000,000 1,400,000 1,700,000 300,000 300,000 100,000i 1,800,000 300,000 0 200,000k 1,988,300 2003 2,000,000 1,400,000 1,788,300j 2004 2,000,000 1,700,000 1,789,380 300,000 99,410 99,410 1,888,790 2005 5,100,000 1,900,500l,m 1,884,799 200,000 297,600 277,250 2,162,050 2006 5,100,000 1,800,000l 2,480,000 200,000 681,000 679,960 3,160,000 2007 5,100,000 1,782,000 1,980,000 0 181,000 181,000 2,161,000 2008 —n 1,500,000 1,980,000 282,000 590,328 610,678o 2,590,678 2009 —n 1,700,000 4,509,672 300,000 590,328 590,328 5,100,000 2010 —n 2,410,000p 4,509,672 790,000 590,328 590,678 5,100,350 2011 — 2,510,000q — 790,000 — — — Source: Prepared by the Congressional Research Service (CRS) on the basis of HHS data. a. Amounts listed under the Regular Funds heading are for regular funding only. In 1994, Congress enacted a permanent $600 million annual authorization for contingency funding. As shown, however, before this authorization contingency funds were sometimes made available. b. Such sums as necessary. c. President Clinton released $400 million of these FY2000 contingency funds in late September 2000 making it effectively available to states in FY2001. d. These funds were distributed out of the total FY2002 contingency appropriation (P.L. 107-116). With the end of FY2002, the remaining $200 million of these contingency funds expired. e. The final FY2003 appropriations act (P.L. 108-7) included $1.688 billion in new regular funds and converted into regular funds $100 million of remaining contingency funds originally appropriated in FY2001 (P.L. 10720). f. These funds were distributed out of contingency dollars appropriated as part of the FY2001 supplemental (P.L. 107-20). That law provided that the funds were “available until expended.” Congress subsequently converted some of these dollars into regular funds (see tablenote). g. Of the amounts requested by the President in FY2005 and FY2006, $500,000 was to be set aside for a national evaluation. h. Congressional Research Service 26 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding b. Congress first allocated emergency contingency funds in January of 1991 due to the price of home heating oil (P.L. 101-517). Funds were not requested in the President’s budget until FY1992. c. Such sums as necessary. d. The President’s FY1995 request would have made the unallocated contingency funds that were appropriated in FY1994 (P.L. 103-112) available until expended. e. The President’s FY1996 request would have made the unallocated contingency funds that were appropriated in FY1995 (P.L. 103-333) available until expended. f. The Administration released $400 million of the FY2000 contingency funds in late September 2000, making them effectively available to states in FY2001. g. The initial contingency fund appropriation for FY2001was $300 million (P.L. 106-554). The Administration released the entire amount by December 30, 2000. On July 24, 2001, the 2001 Supplemental Appropriations Act (P.L. 107-20) provided an additional $300 million in contingency funds. h. The distributed contingency funds in FY2001 included the $300 million appropriated in P.L. 106-554 and the amount remaining from FY2000 (approximately $156 million). The $300 million that was appropriated as part of P.L. 107-20 was made available until expended; a portion was distributed in FY2003 and the remainder was converted to regular funds that same year. i. The FY2002 contingency funds were distributed out of the total FY2002 contingency appropriation (P.L. 107-116). With the end of FY2002, the remainder of the contingency funds expired ($200 million). j. The FY2003 appropriations act (P.L. 108-7) included $1.688 billion in new regular funds and converted into regular funds $100 million of remaining contingency funds originally appropriated in FY2001 (P.L. 107-20). k. FY2003 contingency funds were distributed out of contingency dollars appropriated as part of the FY2001 supplemental (P.L. 107-20). l. Of the amounts requested by the President in FY2005 and FY2006, $500,000 was to be set aside for a national evaluation. m. In FY2005, the President’s initial budget request for LIHEAP regular funds was $1,800,000,500. However, on November 14, 2004, the President submitted a budget amendment to Congress, requesting $1,900,000,500 for LIHEAP regular funds. i n. LIHEAP has not been unauthorizedauthorized in FY2008, FY2009, and FY2010. o and FY2009. j. Of the contingency funds distributed in FY2008, $20 million came from funds appropriated in the FY2005 Departments of Labor, Health and Human Services, and Education Appropriations Act (P.L. 108-447). Contingency funds in P.L. 108-447 were made available until expended. kp. In FY2010, the President proposed that a mechanism be created whereby additional LIHEAP funds would be released when energy price increases reached certain levels. This “trigger” is estimated to result in ; the proposal was not adopted by Congress. The Administration estimated that this “trigger” would have resulted in mandatory budget authority of $450 million. This amountestimate is not included in proposed funding for regular funds. Congressional Research Service 17 The Low-the table. q. In FY2011, the President again proposed a trigger to release additional LIHEAP funds. In addition to proposing that funds be released when energy prices increase, the FY2011 proposal would release funds when participation in SNAP (formerly known as Food Stamps) increases above a certain level. The Administration estimates that this trigger would result in mandatory budget authority of $2 billion. This estimate is not included in the table. Congressional Research Service 27 The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding Author Contact Information Libby Perl Specialist in Housing Policy eperl@crs.loc.gov, 7-7806 Congressional Research Service 1828