LIHEAP Clearinghouse News Bulletin - December 2012

A number of studies have lauded the success and cost effectiveness of federal stimulus funding provided to the Weatherization Assistance Program (WAP), according to a recent report by the National Consumer Law Center.

The report details the initial challenges faced by the WAP as it ramped up with vastly increased funding — $5 billion — through American Recovery and Revitalization Act (ARRA). From mid-2009 through September 2012 WAP agencies overcame challenges and weatherized nearly one million homes, largely due to the extra ARRA funds. The success of the program in providing jobs and enhancing the economy in Massachusetts is highlighted, along with snapshots from other states' successful programs, including Washington and Ohio.

The report also focuses on the challenges WAP faces in maintaining an adequate and sustainable funding level for the program post-ARRA. Entering FY 2013, ARRA funds have been spent and the WAP finds itself with its lowest funding in decades — $68 million in DOE WAP funds provided under the FY 2013 Continuing Resolution, which weatherization advocates hope Congress will increase when it finalizes FY 2013 appropriations.

For many states, the money their WAP receives from LIHEAP is the only certainty they have. Historically, WAP has received from 36 to 60 percent of its total funding from LIHEAP under which states are allowed to set aside up to 15 percent, (or up to 25 percent with a waiver), of their LIHEAP grants for weatherization.

Typically, according to LIHEAP Clearinghouse records, nearly half of the states have regularly set aside 15 percent of their LIHEAP funds, and 3-4 states receive a waiver up to 25 percent. Others set aside a flat amount each year amounting to between 5 and 10 percent. Typically 3-4 states provide less than $1 million per year for furnace repair and replacement only and an equal number provide no funding for weatherization.

A few states reduced their set asides during the ARRA years, recognizing that the program had more money than it could spend. However, the amount of weatherization funding from LIHEAP actually increased during that time — even if states reduced their set aside or kept the same percentages — because LIHEAP funding had also increased.

During FY 2012, according to LIHEAP Clearinghouse records, 24 states provided weatherization 15 percent of their grant or higher; 8 provided between 10 and 14 percent, 9 less than 10 percent, and 10 provided none.

For 2013, state LIHEAP plans indicate that 24 grantees intend to set aside 15 percent of their LIHEAP grant; 3 states planned to seek a waiver to exceed 15 percent, and only a couple states were decreasing their set aside from 2012. Of the 10 states that provided zero weatherization funding for 2012, 5 planned to increase their contribution. States may amend their plans and change these amounts throughout their fiscal year, and they must wait until after March 31 to request waivers.

Many state LIHEAP offices have extremely close working relationships with WAP, (at least 32 states administer LIHEAP and WAP through the same office), and are sympathetic to the fiscal hardship the WAP faces this year.

The history of WAP funding from all sources is detailed in annual funding surveys, the latest of which covers 2011.

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States Receive $21 Million in Leveraging Awards; Tribes Receive $4.6 Million

In early October the U.S. Department of Health and Human Services, Division of Energy Assistance, awarded $25.5 million to 35 states and 22 tribes for leveraging activities conducted during FY 2010. Of the total awards, states received $20.9 million and tribes $4.6 million.

States leveraged nearly $3 billion and it was the first time that a single state's leveraged resources totaled over $1 billion — California's total for the year was a record $1.2 billion. The majority of the state's resources are from its mandated low-income rate discounts and energy efficiency programs. Pennsylvania had the second highest leveraging total with $422.6 million and New Jersey was third with $307.6 million.

Pennsylvania and California each netted the highest awards, with Pennsylvania's total topping California's by only $1 — it received $3,060,000 to California's $3,059,999. New Jersey had the third highest award at $2.7 million.

Tribes leveraged resources totaled just over $6 million with the Rosebud Sioux Tribe of South Dakota leveraging the most with resources, just over $1 million. The Choctaw Nation of Oklahoma leveraged the second highest amount, $697,672; Washington's Colville Confederated Tribe had the third highest, $503,000. The Choctaw Nation also received the highest award, $563,308.

It was the first time leveraging awards have been made since June of 2010 when 36 states, 22 tribes and one territory reported over $2.6 billion in leveraging activities conducted during FY 2008 or FY 2009.

Generally leveraging awards are made for activities conducted the fiscal year prior to the award year; however, no funds were appropriated for the leveraging incentive program in FY 2011, so states did not report activities for that year. For more details on how the awards are made, see HHS LIHEAP-IM-2012-8.

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EIA Projects Record Heating Oil Expenditures

The October 2012 report from the Energy Information Administration forecasts average expenditures for households that heat with heating oil to be higher than any previous winter on record. Natural gas expenditures are also projected to increase.

EIA projects average household expenditures for heating oil and natural gas will increase by 19 percent and 15 percent, respectively, this winter (October 1 through March 31) compared with last winter.

The forecast for higher household expenditures primarily reflects a return to roughly normal winter temperatures east of the Rocky Mountains compared with last winter's unusual warmth.

For states with high percentages of heating oil users, prices appear to be holding steady thus far. The Maine Governor's Energy Office on December 18 reported the statewide average heating oil price at $3.64 per gallon for the second week in a row; this compares to $3.59 per gallon for the same period last year. In Massachusetts the December 18 statewide average price was $3.87 per gallon compared to $3.77 one year ago.

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