Fiscal cliff threatens federal aid for home heat

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By CLARKE CANFIELD, Associated Press

PORTLAND, Maine (AP) — Poor and elderly Americans who rely on aid from the federal government to heat their homes stand to get less help this year if Congress and the White House fail to figure out a way to avoid the combination of tax increases and automatic spending cuts known as the fiscal cliff.

If that happens, there'll be an automatic 10 percent reduction in funds from the federal Low Income Home Energy Assistance Program. But the plight of those in the estimated 6.9 million households who rely on the money to keep warm hardly appears to be a priority for lawmakers in Washington, said Faye MacDonald, 70, a Bangor retiree who relies on the federal program to heat her small home.

"I feel like a little drop of water in a big pond that they don't care about," she said.

Congress is in no mood to approve emergency spending for heating aid as in past years, said Mark Wolfe of the National Energy Assistance Directors' Association. Already, states have received less money than initially projected because of the pending fiscal cliff.

"In the past, lawmakers would find a way to attach emergency spending for heating aid onto other bills, but that just won't happen in this Congress," he said.

The program distributes funds to all 50 states, the District of Columbia and U.S. territories for both heating and cooling costs, but it is particularly important in low-income states that rely heavily on heating oil. Though just 6 percent of U.S. homes use oil heat, about half of families in New England use it. Residents there are expected to be especially hard hit this winter, thanks to a combination of high oil prices, forecasts of a harsh winter and the possible cut in federal funds, said Wolfe.

Oil is expected to be the most expensive source of heat this winter in the U.S. at about $2,500 per household, ahead of propane, electricity and natural gas, the energy association estimated.

"It could be very tough for a lot of people in New England this winter," Wolfe said.

Every winter, poor and elderly people on fixed incomes struggle with heating bills that can run into thousands of dollars. Some find themselves forced to cut back on other necessities like food or medicine.

When the price of oil is high, MacDonald said it doesn't take long to burn through her monthly income of about $1,300 from Social Security check and her late husband's pension.

She has qualified for $523 in LIHEAP funding this year, which she hopes will pay the oil bills through January. She usually buys oil 50 gallons at a time. The last delivery, on Dec. 4, cost her $179.50 at $3.60 a gallon.

To make do, MacDonald wears sweatshirts and sweatpants around the house so she can keep the thermostat down. She makes casseroles, soups and other dishes that she says stretch her food dollar. But she has to pay for her medications for blood pressure, cholesterol, diabetes and other ailments, and she can't go without electricity or water, making the LIHEAP funds all the more important. Even paying taxes on time is a question without the money.

"Without it, my taxes would probably be paid in September even though they're due in March," she said.

Nationally, the government has allocated $3.47 billion in home energy assistance to the states for fiscal year 2013. Ninety percent of the money was delivered last month, but the remaining 10 percent, nearly $350 million, could hinge on the outcome of talks in Washington to avoid the fiscal cliff.

About 68 percent of households in Maine heat with oil, according to the U.S. Energy Information Administration. Oil heat is used in about half the homes in New Hampshire, Vermont and Connecticut.

Maine received $34.9 million in LIHEAP funding in mid-November, which represents 90 percent of its expected funding of about $38.5 million.

It does have a contingency plan, though, even if no more heating aid comes. Maine officials said they'll take the portion of LIHEAP funds earmarked for home weatherization projects and reallocate them for heating fuel assistance to ensure that the same number of households receive the same help for heating as initially projected.

"People need to stay warm," said Deborah Turcotte of the Maine State Housing Authority, which administers the funds.

New Hampshire has about $23 million in hand and was told to expect about what it got last year, $26 million. If the funding is cut 10 percent, the additional money New Hampshire might not receive as a result represents about 3,700 households, said Celeste Lovett, the state's fuel assistance program manager.

In Vermont, Richard Moffi of the Department of Children and Families is predicting a 4 to 6 percent growth in caseload over last year to about 28,500 low-income families. If the state gets the federal funding it was promised, he expects to be able to maintain the average heating assistance benefit of about $900.

"This assumes that the fiscal cliff doesn't have an impact on our funding," Moffi said. "We'll just have to wait and see."

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Associated Press writers Andrew Miga in Washington, Norma Love in Concord, N.H., and Wilson Ring in Montpelier, Vt., contributed to this report.

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