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The Low-Income Home Energy Assistance
Program (LIHEAP): Program and Funding

Libby Perl
Analyst in Housing Policy
May 6, 2009
Congressional Research Service
7-5700
www.crs.gov
RL31865
CRS Report for Congress
P
repared for Members and Committees of Congress
c11173008

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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 as part of the
Omnibus Budget Reconciliation Act of 1981 (P.L. 97-35), is a block grant program under which
the federal government makes annual grants to states, tribes, and territories 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 using a statutory formula, and
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 million households were eligible for LIHEAP
under the federal guidelines. According to HHS, 5.5 million households received heating or
winter crisis assistance and approximately 500,000 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.
For FY2010, the President has proposed to provide $3.2 billion for LIHEAP. In addition,
according to preliminary budget materials, released on February 26, 2009, the Administration
would create a trigger for additional LIHEAP funds to be released when energy prices increase
above a certain level. This trigger is estimated to result in mandatory spending of $329 million in
FY2010. On April 29, 2009, the House and Senate agreed to the FY2010 Budget Resolution
(S.Con.Res. 13). The Resolution assumes funding of $3.2 billion for LIHEAP, but leaves open the
possibility of additional funds for the program.
This report describes LIHEAP funding, current issues, legislation, program rules, and eligibility.
It will be updated as events warrant.

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The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding

Contents
Introduction ................................................................................................................................ 1
LIHEAP Funding and Recent Developments ............................................................................... 1
Proposed FY2010 Funding.................................................................................................... 1
FY2009 LIHEAP Funding..................................................................................................... 2
Distribution of LIHEAP Contingency Funds ......................................................................... 4
FY2009 Contingency Funds ............................................................................................ 4
LIHEAP Legislation in the 111th Congress............................................................................. 4
Climate Change Legislation and LIHEAP ............................................................................. 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................................................................................................................ 7
Benefit Levels....................................................................................................................... 7
Funds and Their Distribution....................................................................................................... 9
Regular Funds....................................................................................................................... 9
Tier I............................................................................................................................. 10
Tier II ........................................................................................................................... 10
Tier III .......................................................................................................................... 11
Contingency Funds ............................................................................................................. 11
Leveraging Incentive and REACH Funds ............................................................................ 11
Other Funds ........................................................................................................................ 12
Legislative History.................................................................................................................... 12

Tables
Table 1. Final FY2006-FY2009 LIHEAP Funding....................................................................... 3
Table 2. LIHEAP Heating/Winter Crisis Aid, Selected Years ....................................................... 9
Table 3. LIHEAP Funding by State, FY2006 to FY2009............................................................ 13
Table 4. LIHEAP Funding: FY1982 to FY2009......................................................................... 15

Contacts
Author Contact Information ...................................................................................................... 17

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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 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. 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, 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).
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
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
On February 26, 2009, President Obama released his FY2010 budget. Although the budget
appendix was not released on that date, the budget included some details regarding the
Administration’s proposal for LIHEAP funding in FY2010. The Administration proposed to fund
LIHEAP at $3.2 billion, although it did not specify whether the entire amount would be for
regular funds or if a portion would be allocated to contingency funds. In addition, the budget
proposed to create a new mechanism for releasing LIHEAP funds—a trigger whereby additional
funds would be released “whenever there is a spike in energy costs.”2 The budget proposal
estimated that the trigger would result in mandatory spending of $329 million in FY2010.3
The FY2010 Budget Resolution (S.Con.Res. 13), which was agreed to by the House and Senate
on April 29, 2009, assumes the same level of funding for LIHEAP that was proposed by the
President—$3.2 billion. In addition, S.Con.Res. 13 creates a reserve fund for LIHEAP that allows
the House or Senate Budget Committees to adjust aggregate spending levels if additional funding
were to be approved for the program.4 Specifically, the House Budget Committee may adjust the
aggregate spending levels and allocations to committees in order to accommodate the creation of

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 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.
3 Ibid., p. 124.
4 For more information about reserve funds in budget resolutions, see CRS Report RL33122, Congressional Budget
Resolutions: Revisions and Adjustments
, by Robert Keith.
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The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding

a LIHEAP trigger to respond to increased energy prices. However, any trigger would have to be
deficit neutral to satisfy the pay-as-you-go rule.5 Alternatively, in lieu of the trigger, S.Con.Res.
13 allows for LIHEAP appropriations to be increased to $5.1 billion. Specifically, the House and
Senate Budget Committees may adjust aggregate spending levels, discretionary spending limits,
and the allocations to their respective appropriations committees to allow for an additional
appropriation of $1.9 billion for LIHEAP.
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
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 (see Table 1).
Of the total amount appropriated in FY2009, $4.51 billion was allocated to LIHEAP regular
funds. The appropriations law further specified the way in which these regular funds were to be
distributed:
• 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.”
• 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.
Approximately $590 million of the total $5.1 billion appropriation was allocated to contingency
funds, the same amount that Congress appropriated in FY2008.
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.6 Ordinarily, states may set eligibility for LIHEAP assistance at the greater of 60% of
state median income or 150% of poverty.7
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

5 For more information on pay-as-you-go rules, see CRS Report RL34300, Pay-As-You-Go Procedures for Budget
Enforcement
, by Robert Keith.
6 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.
7 42 U.S.C. §8624(b)(2)(B).
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The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding

incentive and Residential Energy Assistance Challenge (REACH) grants8 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.
Table 1. Final FY2006-FY2009 LIHEAP Funding
Regular Funds
Contingency
Funds
Fiscal
Year
Public Laws
Total
State
Set-Asides
Formula
(Approx. $300,000 for technical

Grants
assistance, which is permanently
authorized in the statute)
P.L. 109-149a
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
FY2006
billion
Total 2.48
billion —27.225
million—
681 million
3.161
leveraging incentive fund
billion
FY2007
P.L. 110-5
1.98 billion
—27.225 million—
181 million
2.161
leveraging incentive fund
billion
FY2008
P.L. 110-161c 1.98
billion Not
specifiedd 590
million
2.57
billion
FY2009
P.L. 110-329
4.51 billion Not
specifiedd
590 million 5.1
billion
Source: Congressional Research Service on the basis of P.L. 109-148, P.L. 109-149, P.L. 109-171, P.L. 109-204,
P.L. 110-5, P.L. 110-161, and P.L. 110-329.
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 original y 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.
c. Amounts for Department of Labor, Health and Human Services, and Education programs were subject to a
1.747% rescission. See P.L. 110-161, Division G, Section 528. Amounts in this table represent the amounts
available after the rescission.
d. The FY2008 Consolidated Appropriations Act did not authorize funds for leveraging incentive grants. As a
result, funds that would otherwise have been awarded as leveraging incentive grants were distributed to the
states as part of LIHEAP regular funds. In FY2009, HHS determined that it would award $27 million in
leveraging incentive grants on the basis of FY2008 applications.

8 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.
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The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding

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.
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.
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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.9 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.10
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.
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.

9 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.
10 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
Future, September 2008, http://www.rff.org/RFF/Documents/RFF-DP-08-28.pdf.
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The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding

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.11 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
benefits, choose how benefits are provided, and decide what agencies will administer the
program.12
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 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.13 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.14 Also in FY2006, 3.6% of funds went for cooling aid (offered by 13 states); 10.0% of

11 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.
12 Information regarding state LIHEAP program characteristics and contacts is available at http://www.liheap.ncat.org/
sp.htm.
13 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 (hereafter FY2006 LIHEAP Report to Congress).
14 Ibid., Table C-3, pp. 61-62.
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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).15
Households Served
In FY2006, it is estimated that 5.5 million households received LIHEAP heating or winter crisis
assistance.16 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
LIHEAP began, in FY1983, approximately 6.8 million households received heating 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 3.)
The same trend can be seen in the percentage of federally eligible households that receive heating
or winter crisis assistance. In FY1983, the 6.8 million households that received funds represented
31% of federally eligible households. By FY1999, the number of federally eligible households
receiving LIHEAP heating or winter crisis assistance had dropped to 12%. In FY2004, 14% 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.17 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.
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.18
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

15 Ibid., p. 16.
16 Ibid., p. 21.
17 Ibid., p. 20.
18 Ibid., pp. 23.
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FY2006 was $171, up from $140.19 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 1981.20 (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.
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 $105.21
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.22 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).

19 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).
20 Ibid., p. 33.
21 Ibid., p. 32.
22 See also CRS Report RS20761, LIHEAP and Residential Energy Costs, by Bernard A. Gelb.
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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%
Benefit Levels
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
LIHEAP Coverage
Portion of winter
heating bill covered by
LIHEAP (for all
18% 15% 11% 9% 9% 11% 14% 12% NAc 8% 8% 10%
federally eligible
households)b
Source: Table compiled by 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 dol ars 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.
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.23 The three-tier formula is the

23 States are defined to include the District of Columbia. Indian tribes receive funds out of state allotments that are
(continued...)
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The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding

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
offset the losses to certain states resulting from the formula change, and “prevent severe
disruption to programs,”24 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.25 According to HHS, then, the LIHEAP statute requires use of the old
allotment percentages when funding is less than $1.975 billion.26 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.27 State allotment percentages may be different, however. To ensure that states

(...continued)
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.
24 Report of the Committee on Energy and Commerce (H.Rept. 98-139, Part 2), to accompany H.R. 2439, May 15,
1984, p. 13.
25 42 U.S.C. §8623(a)(2)(A).
26 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).
27 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.
(continued...)
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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.28
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).29 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.”
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.30 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.

(...continued)
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.
28 42 U.S.C. §8623(a)(3).
29 42 U.S.C. §8621(e).
30 42 U.S.C. §8621(d).
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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.31 In addition, the Social Services Block Grant
program allows states to transfer up to 10% of funds to provide low-income home energy
assistance,32 while the Temporary Assistance for Needy Families program gives states the
discretion to use funds for home heating and cooling costs.33
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.
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

31 FY2004 LIHEAP Report to Congress, p. 11. For FY2004, $2 million in oil overcharge funds was available to one
state.
32 42 U.S.C. §1397a(d).
33 42 U.S.C. §604(a)(1).
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The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding

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.34 Because of a provision in
existing law that the Interior Department cannot sell oil and gas obtained as in-kind royalties for
less than market price,35 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
Contingency
(Regular and Contingency)
Allotment
Distributed
Total
State
FY2006
FY2007
FY2008
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
8.165 6.700 7.284 14.653 1.596 16.249
Columbia
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
Hawai
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

34 U.S. Government Accountability Office, Department of Interior—Royalty-in-Kind Oil and Gas Preferences, B-
307767, November 13, 2006, available at http://www.gao.gov/decisions/appro/307767.pdf.
35 42 U.S.C. §15902(b)(3)(A).
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Total Funds Distributeda
Regular
Contingency
(Regular and Contingency)
Allotment
Distributed
Total
State
FY2006
FY2007
FY2008
FY2009
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
Nebraska
28.634 18.940 23.660 39.558 4.512 44.070
Nevada 7.247
4.016
4.366
13.643
0.957
14.599
New
Hampshire
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
New
York
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
Ohio
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
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Total Funds Distributeda
Regular
Contingency
(Regular and Contingency)
Allotment
Distributed
Total
State
FY2006
FY2007
FY2008
FY2009
Tribesb
32.897 23.201 27.983 47.403 7.434 54.837
Territoriesc
3.456 2.788 3.014 6.070 0.664 6.734
Leveraging/REACHd 27.225 27.225 —f 27.000
— 27.000
Training/Tech.
0.297 0.297 0.292 0.300 —
0.300
Asst.e
Total
3,160 2,161 2,591 4,509.672
590.328
5,100
Source: Table 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 al ocations to states (net of the direct awards to
tribes) and any contingency funds awarded to the state in that year.
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. 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.
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 4. LIHEAP Funding: FY1982 to FY2009
(dollars in thousands)
Regular Fundsa
Contingency Fundsa
Fiscal
President’s
Total
Year
Request Authorized
Appropriated
Appropriated
Distributed
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
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Regular Fundsa
Contingency Fundsa
Fiscal
President’s
Total
Year
Request Authorized
Appropriated
Appropriated
Distributed
Distributed
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 925,000 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 1,000,000 2,000,000 1,100,000 300,000 175,299 1,275,299
2000 1,100,000 ssanb
1,100,000 900,000
744,350c 1,844350c
2001 1,100,000 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 1,900,500g,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
Source: Table 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. 107-
20).
f.
These funds were distributed out of contingency dol ars 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.
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h. 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.
LIHEAP is unauthorized in FY2008 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.

Author Contact Information

Libby Perl

Analyst in Housing Policy
eperl@crs.loc.gov, 7-7806




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