Written testimony of David L. Fox
on behalf of the
Campaign for Home Energy Assistance
before the
House Appropriations Subcommittee on Labor, Health & Human Services, and Education
May 23, 2003

I want to thank you, Mr. Chairman, for the opportunity to present testimony regarding funding for the Low Income Home Energy Assistance Program, or LIHEAP. I am David L. Fox, communications director for the Campaign for Home Energy Assistance, a broad-based coalition of consumer activists, utilities and other advocates for LIHEAP.

Now that temperatures across the country have warmed and heavy clothing has been stored away until the next cold-weather season, thoughts of utility bills have begun to fade. But in the halls of Congress, the debate over energy assistance may become increasingly heated.

One issue you and your colleagues must face is whether to provide a needed increase in funding for the Low Income Home Energy Assistance Program at a time when greater demands for defense and homeland security spending may result in domestic spending cuts.

As your discussions move forward, you may find it helpful to know that LIHEAP enjoys tremendous support in every region of the United States. A poll conducted in August 2002 by the Campaign for Home Energy Assistance found that 89 percent of those surveyed were in favor of LIHEAP. And by a 72-to-16 percent margin, Americans opposed setting the program aside in favor of the defense budget.

LIHEAP was created to ensure that families living at or below the poverty level are not without heat during the winter’s coldest months or without some form of cooling during deadly, summer heat waves — so that they are not forced to choose between paying their energy bills and paying for other essentials.

The program works well. LIHEAP provides help when help is needed most. It keeps people in their homes. It keeps them alive.

For more than 25 years, LIHEAP has provided states with grants to help citizens in need who, through no fault of their own, are unable to pay their utility bills in the coldest and hottest months.

Typical of those receiving assistance is a 66-year-old Philadelphia retiree who huddled under blankets one bitter November night to stay warm after he fell $225 behind on his utility bill and his power was shut off. Within 24 hours, the former school custodian had applied for and received a LIHEAP grant that paid the delinquent bill. His heat was back on the next day.

As effective as the program can be, however, it has been underfunded from the very beginning, and states are forced to turn away thousands of qualified applicants when their programs run out of money each year.

This past year, LIHEAP and the nearly 5 million households it served have been pummeled by a “perfect storm” — a combination of higher energy bills, colder weather and, for many individuals, economic calamity.

In addition, senior citizens, people with disabilities and low-income families often carry a higher energy burden than most American households, spending up to 20 percent of their income on home energy bills. For these people, home energy costs have become unaffordable.

The federal Energy Information Administration’s Short Term Energy Outlook states that heating oil expenditures were up 60 percent this past winter, taking into account both price increases and increased consumption as a result of the cold weather.

The Campaign for Home Energy Assistance was encouraged earlier this year when 51 U.S. senators signed a letter urging the Senate Budget Committee to fund LIHEAP at $3.0 billion in Fiscal Year 2004. We were equally encouraged when more than 130 members of the House of Representatives urged the House Appropriations Committee to fund the program at $3.4 billion for FY 2004. That compares with roughly $1.8 billion in the current fiscal year.

We also were heartened in April of this year, when the House overwhelmingly approved an energy bill that would reauthorize at $3.4 billion per year through FY 2006.

The Campaign for Home Energy Assistance applauds these legislative commitments to the program. But good intentions are no guarantee of an increase in funding, and LIHEAP faces a critical need.

A sizable percentage of the American public — and the number grows by the day — need the short-term relief LIHEAP provides. Yet the National Energy Assistance Directors’ Association has estimated that, with an appropriation of $1.8 billion plus the release of $200 million in emergency money this year, the states have been able to help only 17 percent of the U.S. households that were eligible for assistance.

The Campaign also supports the restoration of contingency funding and advance funding for FY 2005.

Advance funding would enable the states to plan for demand and count on money being available even if Congress fails to pass all 13 appropriations bills before the FY 2005 fiscal year begins. It would prevent the hand-to-mouth operation of state programs that occurs whenever government is funded through a series of continuing resolutions.

This is particularly important for “fast-spending” programs, like LIHEAP, which use up the bulk of their appropriations in the first few months of the fiscal year. Their demand is greatest during the winter months, but they can only spend what they get from the federal government, and that money just trickles in under continuing resolutions. Advance funding eliminates that problem.

Demand for assistance through LIHEAP is likely to remain high and continue to grow during the next fiscal year given the current level of unemployment, slow economic growth and the remaining high energy burden faced by low-income households.

Funding the program adequately and providing advanced funding for FY 2005 so that fewer Americans are turned away when the need help makes sense. And it’s the right thing to do.

I thank you, Mr. Chairman, and the members of your Subcommittee for the opportunity to express the Campaign’s views regarding a program that helps millions of Americans each year. We stand ready to provide further assistance or answer any additional questions you might have.