Reed Disappointed by Partial Release of Emergency Heating Assistance Funding

Press Release

In response to a letter sent on Tuesday by U.S. Senator Jack Reed (D-RI) and 45 Republican and Democratic Senators urging President Bush to release $300 million in emergency funding for the Low-Income Home Energy Assistance Program (LIHEAP), the Bush Administration announced today that it would ignore Congress' bipartisan request and release of only $100 million of the funding. Rhode Island will receive $946,648.

The Administration also announced the release of $493,598 in regular formula LIHEAP funding to Rhode Island.

Reed stated, "This fraction of the $300 million of emergency funding is not sufficient to meet the demands that states are facing. An emergency exists now and the President needs to release the entire amount of emergency funding because seniors and working families are facing large bills due to high heating oil and natural gas prices."

Through October over 21,000 family households in Rhode Island have been shut off for non-payment of heating bills. Unfortunately service has been restored to only 12,900 of those families.

The announcement today continues a cycle of request by Congress and delay by the Bush Administration to support greater funding for LIHEAP.

LIHEAP supports approximately 4.5 million households annually by helping to pay winter heating bills. Nearly half are families with children under 18, senior citizens, persons with disabilities and working poor individuals as the remaining beneficiaries.

This year's high-energy prices coupled with the weak economy are causing a rise in applications. Rhode Island expects 28,000 households will need heating assistance this winter - a 6% increase from last year.

As part of the 2005 Omnibus Appropriation Congress approved $300 million in emergency funding with the expectation that the Bush Administration would recognize the financial pain record high prices for oil, natural gas and propane are causing Americans and release the funding immediately.

In 2003 and 2004, the Bush Administration refused to release emergency funding approved by Congress until well into the winter when many states had already run out of funds and could no longer take applications for heating assistance.

Reed also called on the President to request $3 billion for LIHEAP in his fiscal year 2006 budget.

Following is the text of Tuesday's letter:

We urge you to release the $300 million in emergency Low-Income Home Energy Assistance Program (LIHEAP) funding provided in the fiscal year 2005 Consolidated Appropriations Act. Americans are facing record high prices for oil, natural gas and propane this winter. These increases come on top of soaring energy prices over the past several years. Rising energy prices disproportionately burden low-income Americans who are also struggling to pay for higher food, housing and health care costs.

Record high crude oil prices are driving up the costs of heating oil and propane. Nationally, residential heating oil prices were $1.97 per gallon for the first week of December, an increase of 54.4 cents from same time last year. The average residential propane price nationally was $1.71 per gallon, an increase of 35.6 cents over the average for the same time last year. Retail prices in many states are well above the natural average. In New York, for example, the price of heating oil was $2.14 per gallon, and in Virginia, the price of propane was $1.90 per gallon. Over 20 natural gas utilities across the country are requesting rate increases. Utilities in Iowa, Virginia, Missouri, New Mexico and Wyoming, for example, are requesting or have had approved rate increases above 15 percent. Families are facing an energy emergency that requires an immediate response. Without emergency assistance, these families will face impossible choices this winter: whether to heat their homes or eat; whether to buy prescription drugs or pay their electricity bill; or, whether to pay their rent or mortgage or buy heating oil to stay warm. Unfortunately, these are the real choices that face low-income families, disabled Americans and seniors when energy prices are unaffordable.

The current rise in energy prices, along with energy debt remaining from last winter, are leading to increased disconnections and arrears among consumers as the winter heating season begins, which threatens the well-being of families and seniors. Emergency funding is needed immediately to help low-income families and seniors restore disconnected utility service and to ensure affordable heat for their homes. In Rhode Island, there have been 21,267 accounts shut off for nonpayment through October. Service has been restored to just 12,892 accounts. In Pennsylvania, a total of 160,369 households had their natural gas shut-off through October 2004, and only 86,403 households were reconnected. The total amount of overdue debt owed by Pennsylvania consumers through October 2004, was $524 million -- $23 million more than during the same time period in 2003. In Iowa, the energy burden this winter for LIHEAP households is estimated to be 9.8 percent of total household income, a 50 percent increase over the 2000/2001 winter. In Maine, the state received 3,000 more applications for LIHEAP assistance this year than the same time last year.

Many American families are struggling with unaffordable energy prices. While the Consolidated Appropriations Act increased LIHEAP funding from $1.89 billion in 2004 to $2.18 billion in 2005, LIHEAP will require $2.35 billion in 2005 in order to defray the same portion of home heating costs for the same number of low-income households as it did last year. We hope that you will consider these facts as you decide to release the emergency funds and to develop your fiscal year 2006 budget request.

We believe the winter heating crisis facing low-income Americans warrants the release of emergency LIHEAP assistance. Thank you for your consideration.

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