Order Code RL31865
The Low-Income Home Energy Assistance
Program (LIHEAP): Program and Funding
Updated February 27, 2007
Libby Perl
Analyst in Social Legislation
Domestic Social Policy Division

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The Low-Income Home Energy Assistance Program
(LIHEAP): Program and Funding
Summary
The Low-Income Home Energy Assistance program (LIHEAP), established in
1981 (P.L. 97-35), is a block grant program under which the federal government
gives states, territories, and tribes annual grants to operate home energy assistance
programs for low-income households. The LIHEAP statute authorizes two types of
funds: regular funds, which are allocated to all states based on a statutory formula,
and contingency funds, which are allocated to one or more states at the discretion of
the Administration.
For FY2007, Congress appropriated $1.98 billion for regular funds and $181
million for contingency funds (P.L. 110-5), the same amount appropriated in the
Departments of Labor, Health and Human Services, and Education Appropriations
Act for FY2006 (P.L. 109-149). The President’s budget request for FY2008 is
$1.782 billion, of which $1.5 billion would be for regular funds and $282 million for
contingency funds. This is the same amount of funds that the President requested for
FY2007; however, the entire amount in the FY2007 request would have gone to
regular funds.
In FY2006, Congress twice appropriated funds for LIHEAP. First, Congress
appropriated $2.161 billion, of which $1.98 billion was regular funds and $181
million was contingency funds. The funds were appropriated in the Departments of
Labor, Health and Human Services, and Education Appropriations Act (P.L. 109-
149). Congress added $1 billion to LIHEAP on March 20, 2006 (P.L. 109-204). Of
this amount, $500 million was allocated to regular funds and $500 million was
allocated to contingency funds. Thus, a total of $3.161 billion was appropriated for
LIHEAP for FY2006, $2.48 billion for regular funds and $681 million for
contingency funds. This is the most funding that has been appropriated for LIHEAP
in the history of the program.
The Administration has not distributed contingency funds for FY2007 but made
three contingency fund distributions in FY2006. The most recent occurred on
September 12, 2006, when just under $80 million was distributed to 14 states for
winter heating needs. In two previous distributions, the Administration released
$600 million in contingency funds: of this amount, $500 million went to 25 states
on March 24, 2006, and on January 5, 2006, $100 million went to all states, the
District of Columbia, and the territories. Approximately $21 million in contingency
funds remains available from FY2005, and $181 million in FY2007 contingency
funds is available.
In FY2004, the most current year for which data is available, some 5.0 million
households received LIHEAP heating/winter crisis assistance, with an average
benefit of $277, compared with an estimated 4.8 million households in FY2003.
Approximately 308,000 households received cooling aid in FY2004 and 88,000
received summer crisis assistance (compared to 493,000 and 71,000 in FY2003).
The average cooling/summer crisis benefit was $192. This report will be updated as
legislative or program activities warrant.

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Contents
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
FY2008 Proposed LIHEAP Funding . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
FY2007 LIHEAP Funding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
FY2006 LIHEAP Funding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
LIHEAP Contingency Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
LIHEAP Reauthorization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
LIHEAP Legislation in the 110th Congress . . . . . . . . . . . . . . . . . . . . . . 5
Program Rules and Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Federal Eligibility Standards and Grantee Responsibility . . . . . . . . . . . 5
Kinds of Energy Assistance Available . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Use of Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Households Served . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Benefit Levels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Funds and Their Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Regular Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Contingency Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Leveraging Incentive and REACH Funds . . . . . . . . . . . . . . . . . . . . . . 11
Other Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Legislative History . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
List of Tables
Table 1. Final FY2006 and FY2007 LIHEAP Funding
and Proposed FY2008 Funding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Table 2. Recent LIHEAP Funding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Table 3. LIHEAP Heating/Winter Crisis Aid, Selected Years . . . . . . . . . . . . . . . 8
Table 4. LIHEAP Funding by State, FY2004 to FY2007 . . . . . . . . . . . . . . . . . . 13
Table 5. LIHEAP Funding: FY1982 to FY2007 . . . . . . . . . . . . . . . . . . . . . . . . 15

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The Low-Income Home Energy
Assistance Program (LIHEAP):
Program and Funding
Introduction
The Low-Income Home Energy Assistance program (LIHEAP), established in
1981 by Title XXVI of P.L. 97-35, is a block grant program under which the federal
government gives states, territories, and tribes 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. Regular funds
are allotted to states according to methods prescribed by the LIHEAP statute.1 The
second type of LIHEAP funding, called contingency funds, may be released and
allotted to one or more states at the discretion of the President and the Secretary of
Health and Human Services (HHS).
In FY2007, Congress appropriated $1.98 billion in regular funds and $181
million in contingency funds for LIHEAP (P.L. 110-5). These are the same amounts
that were appropriated in the Departments of Labor, Health and Human Services, and
Education Appropriations Act in FY2006 (P.L. 109-149) as reduced by a 1% across-
the-board rescission (P.L. 109-148). In addition to the amounts initially appropriated
for LIHEAP in FY2006, P.L. 109-204 made $1 billion available, $500 million for
regular funds and $500 million for contingency funds.
In FY2004, the most current year for which data could be obtained from the
U.S. Department of Health and Human Services (HHS), an estimated 5.0 million
households received help meeting heating costs (i.e., heating assistance and/or
winter/year-round crisis assistance).2 In FY2004, approximately 308,000 households
received cooling assistance, and 88,000 received summer crisis aid.3 Approximately
112,000 households received weatherization assistance through LIHEAP in FY2004.
Recent Developments
FY2008 Proposed LIHEAP Funding. The President released his FY2008
budget on February 5, 2007. In it, he proposed to provide $1.782 billion for
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).
2 U.S. Department of Health and Human Services, LIHEAP Office.
3 The amount of overlap between households that received cooling aid and summer crisis
aid is not known; thus an estimated number of households that received aid related to
cooling (comparable to those receiving aid with heating costs) is not available.

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CRS-2
LIHEAP. This is the same amount the President proposed for FY2007, but the
breakdown of funds is different. In FY2007, the Administration’s budget requested
that the entire amount be allocated to regular funds, while for FY2008, $1.5 billion
would be allocated to regular funds and $282 million to contingency funds.
FY2007 LIHEAP Funding. For FY2007, Congress appropriated $1.98 billion
in regular funds and $181 million in contingency funds through a year-long
continuing resolution (P.L. 110-5). This is the same amount appropriated for
LIHEAP in the FY2006 Departments of Labor, Health and Human Services, and
Education Appropriations Act (P.L. 109-149) as reduced by a 1% across-the-board
rescission (P.L. 109-148). The total amount appropriated in FY2007 exceeded the
President’s budget request of $1.782 billion by $380 million. The House
Appropriations Committee would have provided $1.93 billion in regular LIHEAP
funds and $181 million in contingency funds in the Departments of Labor, Health
and Human Services, and Education Appropriations Act (H.R. 5647). The Senate
Appropriations Committee would have provided $1.98 billion in regular LIHEAP
funds and $181 million in contingency funds in its version of the spending bill (S.
3708). Prior to enactment of P.L. 110-5 on February 15, 2007, three continuing
resolutions provided funding for LIHEAP.4
FY2006 LIHEAP Funding. Congress appropriated a total of $3.161 billion
to LIHEAP for FY2006 in two separate laws, the most funding that has ever been
appropriated for LIHEAP. The Departments of Labor, Health and Human Services,
and Education Appropriations Act (P.L. 109-149) allocated $2 billion for regular
funds to be distributed to all states, and $183 million as emergency contingency
funds, to be distributed at the discretion of the Secretary of HHS. After a 1% across-
the-board rescission in the Department of Defense Appropriations Act (P.L. 109-
148), these amounts were reduced to $1.98 billion and $181 million.5 Congress made
available an additional $1 billion for LIHEAP on March 20, 2006, $500 million in
regular block grant funds, and $500 million in contingency funds (P.L. 109-204). On
March 24, the Administration distributed the entire $500 million in contingency
funds to 25 states based on average temperature and the energy sources used by low-
income households.
Table 1, below, shows LIHEAP funding for FY2006 and FY2007 and proposed
funding for FY2008.
4 These were P.L. 109-289, P.L. 109-369, and P.L. 109-383.
5 HHS makes proportionate cuts in the individual budget authorities within LIHEAP —
regular funds, contingency funds, Leveraging Incentive and REACH grants, and training and
technical assistance — in order to comply with rescission requests.

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Table 1. Final FY2006 and FY2007 LIHEAP Funding and
Proposed FY2008 Funding
Regular
State formula
Set-asides
Contingency
Total
grants
($300,000 for technical
assistance, which is permanently
authorized in the statute)
Final FY2006 Appropriationa
P.L. 109-149
$1.98 billion
— $27.225 million —
$181 million
$2.161
leveraging incentive fund
billion
P.L. 109-204b
$500 million
None
$500 million
$1.0
billion
Total
$2.48 billion
— $27.225 million —
$681 million
$3.161
leveraging incentive fund
billion
Final FY2007 Appropriation
P.L. 110-5
$1.98 billion
— $27.225 million —
$181 million
$2.161
leveraging incentive fund
billion
FY2008 Proposed Funding
President’s
$1.50 billion
— $27.225 million —
$282 million
$1.782
Request
leveraging incentive fund
billion
(this amount is assumed in
Administration budget
documents)
Source: Congressional Research Service based on P.L. 109-148, P.L. 109-149, P.L. 109-171, P.L.
109-204, P.L. 110-5, and the U.S. Department of Health and Human Services (HHS), Administration
for Children and Families (ACF) FY2008 Justification of Estimates for Appropriations Committees.
a. Under the Department of Defense Appropriations Act (P.L. 109-148), discretionary spending in
FY2006 was reduced by 1% through an across-the-board rescission. The amounts in P.L. 109-
149 include the rescission.
b. The funds made available for FY2006 in P.L. 109-204 were originally appropriated for FY2007 in
the Deficit Reduction Act of 2005, P.L. 109-171. Congress shifted the funds to FY2006 in P.L.
109-204.
LIHEAP Contingency Funds. The Administration has not yet released
contingency funds in FY2007. Currently just under $21 million in contingency funds
from the FY2005 appropriations law (P.L. 108-447) remains available until
expended. In addition, Congress appropriated $181 million in contingency funds for
FY2007 in its year-long continuing resolution (P.L. 110-5).
The Administration released contingency funds on three occasions in FY2006.
In its first distribution, on January 5, 2006, the Administration released $100 million.
The funds were disbursed to all states, the District of Columbia, and the territories
using the regular block grant allocation, weighted by the percentage of low-income
households in each state that use natural gas, heating oil, and propane for heat. On

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CRS-4
March 24, 2006, the Administration released an additional $500 million in
contingency funds to 25 states. To receive funds, states must have experienced an
average winter temperature of 40 degrees Fahrenheit or lower, and at least 60% of
low-income households in the state must have used natural gas, heating oil, or
propane to heat their homes. The Administration then distributed funds to those
states that met these threshold requirements using the percentage of low-income
households heating their homes with natural gas, heating oil, and propane, the
percentage of funds received under the block grant allocation, and average
temperature. The third distribution of funds occurred on September 12, 2006, when
the Administration released $80 million to 14 states to help pay heating costs for the
upcoming winter. States were eligible if they experienced an average temperature of
47 degrees Fahrenheit or lower between October 5, 2005, and March 31, 2006, and
at least 15% of low-income households used heating oil as their primary heating
source. (For a breakdown of funds, see Table 5.)
Table 2, below, shows recent federal funding levels for LIHEAP, including the
amount of contingency funds released.
Table 2. Recent LIHEAP Funding
(dollars in millions; sums may not equal totals due to rounding)
Fiscal
Funds appropriated
Contingency funds
Total funds
year
distributeda
distributedb
Regularc
Contingency
To
To
Subtotal
Subtotal
Total
all
some
(to all
states
states
states)
2002
1,700
300
0
100
100
1,700
1,800
2003
1,788
0
200
0
200
1,988
1,988
2004
1,789
99
40
59
99
1,829
1,889
2005
1,885
298
250
27.25
277.25
2,135c
2,162c
2006
2,480
681
100
580
680
2,580
3,160
2007
1,980
181
0
0
0
1,980
1,980
Source: Tables prepared by the Congressional Research Service (CRS).
a. The amount of contingency funds appropriated in a fiscal year may differ from the amount of
contingency funds that are distributed in that fiscal year for two reasons: First, the LIHEAP
statute gives the Administration discretion to release (or not release) any of the available
contingency funding. Further, these funds, as directed by the Congress in its appropriations
language, may be available for release in one or more years.
b. Regular funds, all of which are included in both of the Total Funds Distributed columns, include
all regular funding distributed by formula to the states, the tribes, and the District of Columbia,
as well as set-asides for the territories, leveraging incentive grants, REACH grants, and technical
assistance (with total set-asides of approximately $30 million). The “Subtotal to all states”
column includes all regular funds plus any contingency funds that were distributed to all states;
the “Total” column includes all regular funds plus any contingency funds that were distributed
to one or more states.
c. Regular LIHEAP funds are made available to states on a quarterly basis (October, January, April,
and July). However, states may specify what percentage of their total allotment they wish to
receive in each quarter, and many states receive all, or the great majority of, their LIHEAP funds
in the first two quarterly disbursements.

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CRS-5
LIHEAP Reauthorization. Authorization for LIHEAP expires at the end of
FY2007 (P.L.109-58). The program has never been unauthorized, and it is
anticipated that the 110th Congress will reauthorize the program. Committees with
jurisdiction over LIHEAP are the Senate Health, Education, Labor, and Pensions
Committee and the House Education and Labor Committee.
LIHEAP Legislation in the 110th Congress. Early in the first session of
the 110th Congress, two bills have been introduced that would affect LIHEAP. H.R.
153, the LIHEAP Equity Act of 2007, would mandate that no more than 50% of the
funding provided under LIHEAP could be made available for heating purposes. The
second bill, S. 669, the LIHEAP Emergency Reform Act, concerns contingency
funds. The bill would allow a state governor to apply to the Secretary of Health and
Human Services for certification that there is an emergency in his or her state (as
defined by the LIHEAP statute) and for an allotment of contingency funds in
response to the emergency.
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.6 Federal rules also
6 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
(continued...)

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CRS-6
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
benefits, choose how benefits are provided, and decide what agencies will administer
the program.7
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
home-energy 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 majority of LIHEAP funding is used to offset home
heating costs. In FY2003, the most recent year in which data regarding total spending
is available, approximately 72% of all LIHEAP funds were used to provide heating
assistance or crisis aid related primarily to heating needs; all states (including the
District of Columbia) provided some heating assistance, and nearly all also offered
crisis aid related to heating needs. In that same year, 3.5% of funds were used for
cooling/summer crisis aid; just 15 states offered cooling assistance and only six
offered summer crisis aid. Also in FY2003 10.5% of total LIHEAP funds were used
for weatherization services (provided by 46 states); 8.2% of available funds were
used for administration and planning purposes (51 states), and 1% of the FY2003
funds were used to offer services to reduce the need for energy assistance (provided
by 21 states).8
Households Served. Since the LIHEAP program began in the early 1980s,
both the percentage of eligible households served and the absolute number of
households receiving heating/winter crisis assistance have generally declined.
However, in FY2003 and FY2004 both figures increased somewhat, to 4.8 million
and 5.0 million recipients. (See Table 3 below.) The number of households
receiving cooling assistance reached its high point in FY2002, with more than half
a million recipients. However, in FY2003 and FY2004, the number of recipients fell
below that number.
6 (...continued)
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].
7 Information regarding state LIHEAP program characteristics and contacts is available at
[http://www.liheap.ncat.org/sp.htm].
8 Based on state-reported total LIHEAP expenditures for FY2003 (including federal and any
supplemental non-federal funding) of $2.112 billion. LIHEAP Report to Congress for
FY2003, p. 14.

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CRS-7
States reported that in FY2004, approximately 4.6 million households received
assistance with heating payments; 308,000 received cooling aid; approximately 1.1
million received winter/year-round crisis aid; 88,000 received summer crisis aid; and
112,000 received weatherization assistance. Because many households may receive
more than one kind of LIHEAP assistance, a total, unduplicated number of
households assisted is not available. However, these data are used to estimate that
some 5.0 million households received heating assistance or heat-related crisis aid in
FY2004.9
The Census Bureau’s 2003 Annual Social and Economic Supplement indicates
that among all households receiving LIHEAP heating assistance, about 36% had at
least one member 60 years of age or older; about 48% had at least one disabled
member; and some 23% included at least one child five years of age or younger.
These same census data showed that a minority of households receiving LIHEAP
heating assistance also received other kinds of federal aid: an estimated 12%
received TANF; 24% received SSI; and 26% lived in rent-subsidized or public
housing.10
Benefit Levels. The constant dollar value of LIHEAP heating/winter crisis
benefits declined from the program’s beginning until FY1998 — in FY1983, the
average benefit was $209 dollars, and by FY1998 it was $117. Although the value
of benefits went up from FY1999 through FY2001, in FY2004 the average constant
dollar benefit was down to $132. In nominal dollars, the average heating/winter
crisis benefit fell from $312 in FY2003 to $277 in FY2004. The average nominal
cooling/summer crisis benefit, which is available to a more limited number of
households in far fewer states, had largely risen until FY2002, when it fell sharply
to $145 from $211 in FY2001. In FY2003, this benefit stayed approximately the
same, at $148, and in FY2004 it increased to $192.11
9 Department of Health and Human Services, LIHEAP Office.
10 LIHEAP Report to Congress, FY2003., pp. 19-21.
11 Department of Health and Human Services, FY2004 LIHEAP Home Energy Notebook, p.
30. In constant (1981 dollars) the average cooling/summer crisis benefit was worth $57 in
FY1983, $107 in both FY2000 and FY2001, $70 in FY2002, $80 in FY2003, and $91 in
FY2004.

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Table 3. LIHEAP Heating/Winter Crisis Aid, Selected Years

Fiscal year
1983
1990
1993
1998
1999
2000
2001
2002
2003
2004
Households
Number receiving
6.8
5.8
5.6
3.9
3.6
3.9
4.8
4.4
4.8
5.0
aid (in millions)
Number federally
22.2
25.4
28.4
29.1
29.0
29.4
30.4
32.7
34.5
35.4
eligible (in millions)
Federally eligible
31%
23%
20%
13%
12%
13%
16%
13%
14%
14%
and receiving aid
Benefit Levels
Average benefit
$225
$209
$201
$213
$237
$270
$364
$291
$312
$277
(nominal dollars)
Average benefit
$209
$147
$129
$117
$128
$140
$187
$147
$154
$132
(constant 1981
dollars)a
Costs Offset
Portion of winter
18%
15%
11%
9%
9%
11%
14%
12%
NAc
8%
heating bill covered
by LIHEAP (for all
federally eligible
households)b
Portion of
Before receiving LIHEAP benefit
household income
8.3%
4.5%
4.7%
3.4%
3.3%
3.3%
4.7%
3.6%
4.9%
4.8%
required for home
heating (for
After receiving LIHEAP benefit
LIHEAP-recipient
households)
2.6%
2.0%
2.4%
1.3%
1.1%
1.0%
1.7%
1.3%
NAc
2.7%
Source: Table compiled by Congressional Research Service (CRS) based on 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 for FY1998, FY2000, FY2001, FY2002, FY2003, and FY2004.
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.
The LIHEAP benefit now covers a smaller portion of home heating bills than
in earlier years, 8% in FY2004 compared to 18% in FY1983. And while the portion
of household income required for home heating by LIHEAP-recipient households
before receiving the LIHEAP benefit is less than when the program began, the
portion of a recipient household’s budget required for home heating after receiving
the LIHEAP benefit is slightly more in FY2004 than it was in FY1983 (2.7%
compared to 2.6%). In recent years, leading up to FY2004, the percentage of a
household’s budget required to pay for heating post-benefit had been in the single
digits. (See Table 3.)

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CRS-9
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.12 These include
! 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).
Funds and Their Distribution
The LIHEAP statute authorizes regular funds appropriations, which are
allocated to all states based on a statutory formula, and contingency fund
appropriations, which are allocated to one or more states at the discretion of the
Administration. It 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.13 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.14
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 offset the losses to
certain states resulting from the formula change, and “prevent severe disruption to
12 See also CRS Report RS20761, LIHEAP and Residential Energy Costs, by Bernard Gelb.
13 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.
14 For more information on the history of the LIHEAP formula, see CRS Report RL33275,
Low-Income Home Energy Assistance Program (LIHEAP) Allocation Rates: Legislative
History and Current Law, by Julie Whittaker and Libby Perl.

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CRS-10
programs,”15 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.16
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.17 According to HHS, then, the
LIHEAP statute requires use of the old allotment percentages when funding is less
than $1.975 billion.18 Until FY2006, funding levels 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.19 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.20
15 Report of the Committee on Energy and Commerce (H.Rept. 98-139, Part 2), to
accompany H.R. 2439, May 15, 1984, p. 13.
16 For more information on the percentage share of funds a state would receive at various
levels of funding, see CRS Report RS21605, Low-Income Home Energy Assistance Program
(LIHEAP): Estimated Allocations, by Libby Perl.
17 42 U.S.C. §8623(a)(2)(A).
18 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).
19 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.
20 42 U.S.C. §8623(a)(3).

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CRS-11
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 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).21 Appropriated contingency funds may only be released at the
discretion of HHS and may be allocated to one or more states based on 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.”
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.22 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 based
on 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
21 42 U.S.C. §8621(e).
22 42 U.S.C. §8621(d).

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CRS-12
by oil companies.23 Finally states have the authority to transfer funds to LIHEAP
from certain other federal block grants (including TANF).
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 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.
Finally, 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; 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; and allowed the
Secretary of the Interior, when disposing of in-kind oil and gas royalties taken from
oil and gas leases, to grant a preference for the purpose of providing additional
resources to support federal low-income energy assistance programs.
23 LIHEAP Report to Congress, FY2003, p. 11. For FY2002, $3.3 million in oil overcharge
funds was available to two states.

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CRS-13
Table 4. LIHEAP Funding by State, FY2004 to FY2007
(dollars in millions)
Total funds distributeda
Regular
Contingency
State
(regular and contingency)
allotment Distributedb
Total
FY2004
FY2005
FY2006
FY2007
Alabama
$15.4
$19.9
$31.787 $16.673

—
$16.673
Alaska 7.5
10.1
12.839
7.418

—
7.418
Arizona
6.9
7.7
14.230 7.448

—
7.448
Arkansas
11.8
13.5
23.336 12.796

—
12.796
California 82.4
91.7
156.441
89.199

—
89.199
Colorado
28.9
32.4
44.806 31.334

—
31.334
Connecticut
40.2
46.8
71.106 40.920

—
40.920
Delaware
5.3
6.2
10.954 5.431

—
5.431
District of Columbia
6.2
6.7
8.165
6.355
—
6.355
Florida
24.5
29.6
49.785 26.527

—
26.527
Georgia
19.4
22.5
40.026 20.979

—
20.979
Hawaii
1.9
2.2
2.567 2.113

—
2.113
Idaho
11.1
12.2
14.055 11.642

—
11.642
Illinois
104.5
117.2
193.814 113.259

—
113.259
Indiana
47.3
53.9
75.327 51.272

—
51.272
Iowa
33.5
38.9
52.054 36.343

—
36.343
Kansas
15.4
17.4
27.709 16.675

—
16.675
Kentucky
24.6
28.1
45.320 26.686

—
26.686
Louisiana 15.8
29.8
32.671
17.144

—
17.144
Maine
25.1
30.6
43.496 25.541

—
25.541
Maryland
30.8
34.2
61.889 31.332

—
31.332
Massachusetts
80.4
91.9
126.425 81.820

—
81.820
Michigan
105.0
112.5
153.615 106.543

—
106.543
Minnesota
71.5
84.0
110.849 77.469

—
77.469
Mississippi
13.2
27.4
27.415 14.350

—
14.350
Missouri
41.7
48.1
78.220 45.240

—
45.240
Montana
11.2
12.8
19.259 11.843

—
11.843
Nebraska
16.6
19.0
28.634 17.961

—
17.961
Nevada
3.5
4.0
7.247 3.809

—
3.809
New Hampshire
15.2
18.3
27.740
15.493
—
15.493
New Jersey
74.5
83.9
114.759
75.798
—
75.798
New Mexico
8.7
9.9
11.555
9.358
—
9.358
New York
243.4
277.9
381.719
247.980
—
247.980
North Carolina
33.6
40.6
71.125
36.319
—
36.319
North Dakota
12.4
14.0
19.272
12.753
—
12.753
Ohio
98.4
104.7
164.226 100.195

—
100.195
Oklahoma
13.0
14.7
26.921 13.991

—
13.991
Oregon
21.8
25.0
24.575 23.614

—
23.614
Pennsylvania
130.9
145.5
202.324 133.273

—
133.273
Rhode Island
13.2
15.1
23.066
13.435
—
13.435
South Carolina
12.3
14.6
25.279
13.318
—
13.318
South Dakota
9.6
11.6
16.540
10.410
—
10.410

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CRS-14
Total funds distributeda
Regular
Contingency
State
(regular and contingency)
allotment Distributedb
Total
FY2004
FY2005
FY2006
FY2007
Tennessee
24.9
28.3
47.139 27.033

—
27.033
Texas
40.7
46.2
84.005 44.144

—
44.144
Utah
14.0
14.7
22.848 14.233

—
14.233
Vermont
11.4
13.8
20.903 11.613

—
11.613
Virginia
37.5
41.7
75.053 38.166

—
38.166
Washington
35.4
39.9
39.631 38.355

—
38.355
West Virginia
17.4
18.5
24.543
17.660
—
17.660
Wisconsin
64.3
75.3
99.837 69.773

—
69.773
Wyoming
5.2
5.9
8.987 5.558

—
5.558
Subtotal
$1,840
$2,111
$3,096
$1,929
—
$1,929
Tribesc
19.0
20.1
32.897
21.280
—
21.280
Territoriesd
2.5
2.9
3.456
2.644
—
2.644
Leveraging/REACHe
27.3
27.3
27.225
27.225
—
27.225
Training/Tech. Asst.f
0.3
0.3
.297
.297
—
.297
Total
$1,889
$2,162
$3,160
$1,980
—
$1,980
Source: Table compiled by the Congressional Research Service (CRS) based on 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.
b. No contingency funds have been distributed in FY2007.
c. 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.
d. 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).
e. 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). The 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.
f. 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.

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CRS-15
Table 5. LIHEAP Funding: FY1982 to FY2007
(dollars in thousands)
Regular Fundsa
Contingency Fundsa
Fiscal
Total
Year
Distributed
President’s
Request
Authorized
Appropriated
Appropriated
Distributed
1982
$1,400,000
$1,875,000
$1,875,000
—
—
$1,875,000
1983
1,300,000
1,875,000
1,975,000
—
—
1,975,000
1984
1,300,000
1,875,000
2,075,000
—
—
2,075,000
1985
1,875,000
2,140,000
2,100,000
—
—
2,100,000
1986
2,097,765
2,275,000
2,100,000
—
—
2,100,000
1987
2,097,642
2,050,000
1,825,000
—
—
1,825,000
1988
1,237,000
2,132,000
1,531,840
—
—
1,531,840
1989
1,187,000
2,218,000
1,383,200
—
—
1,383,200
1990
1,100,000
2,307,000
1,443,000
—
—
1,443,000
1991
1,050,000
2,150,000
1,415,055
195,180
195,180
1,610,235
1992
1,025,000
2,230,000
1,500,000
300,000
0
1,500,000
1993
1,065,000
ssanb
1,346,030
595,200
0
1,346,030
1994
1,507,408
ssanb
1,437,402
600,000
300,000
1,737,402
1995
1,475,000
2,000,000
1,319,202
600,000
100,000
1,419,202
1996
1,319,204
2,000,000
900,000
180,000
180,000
1,080,000
1997
1,000,000
2,000,000
1,000,000
420,000
215,000
1,215,000
1998
1,000,000
2,000,000
1,000,000
300,000
160,000
1,160,000
1999
1,300,000
2,000,000
1,100,000
300,000
175,299
1,275,299
2000
1,400,000
ssanb
1,100,000
900,000
744,350c
1,844350c
2001
1,400,000
ssanb
1,400,000
600,000
455,650
1,855,650
2002
1,400,000
2,000,000
1,700,000
300,000
100,000d
1,800,000
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
1,800,500g
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
—
1,980,000
Source: Table prepared by the Congressional Research Service (CRS) based on 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 Sept. 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. 107-20).
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 e).
g. Of this amount, the President requested that $500,000 be set aside for a national evaluation.

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