LOW-INCOME HOME ENERGY ASSISTANCE PROGRAMS THURSDAY, MARCH 29, 1990 U.S. SENATE, SUBCOMMITTEE ON CHILDREN, OF THE COMMITTEE ON LABOR AND HUMAN RESOURCES, Washington, DC. The subcommittee met, pursuant to notice, at 1:50 p.m., in room SD-430, Dirksen Senate Office Building, Senator Christopher J. Dodd (chairman of the subcommittee) presiding. Present: Senators Dodd, Pell, Adams, and Coats. OPENING STATEMENT OF SENATOR DODD Senator DODD. The subcommittee will come to order. I would like to welcome all of you to our hearings this afternoon concerning the reauthorization of the Low-Income Home Energy Assistance Program. Since its inception in 1979, LIHEAP has been a lifeline to the most disadvantaged people in our country. It is a critically important safety net program which keeps millions of our most vulnerable citizens from freezing during the cold winter months and from exposure to dangerous heat during the summer. LIHEAP recipients truly are the neediest people of the needy: Poor women with dependent children, the frail elderly on fixed incomes, households headed by or containing handicapped persons, the working poor, people in the grips of seemingly permanent poverty. In short, the most impoverished families in our Nation or our society, too often faced with the choice between putting food on the table and heating their homes. We all know that in the current political climate, many Federal programs are in a funding squeeze. Some are in more trouble than others. However, because of the number of years they have been subject to the budget knife, the LIHEAP program has suffered more than its share of funding cuts, despite the fact that so many children, elderly and their families depend on it. In fact, funding for the LIHEAP program has been in a steady decline since 1985, when appropriations peaked at $2.1 billion. Since then, funding has dropped off by one-third, to $1.39 billion in the current fiscal year. A crisis is developing, because of the $700 million drop in LIHEAP funding in the last 4 years. As a result of this decline, (1) benefits to millions of homes have been reduced and nearly half a million have seen them totally disappear. As it is, the current funding only serves 25 percent of eligible households. Participation has consistently been in the 6 to 7 million household range, while roughly 18 million households appear to be eligible to participate in the State implemented programs. Since LIHEAP is a fixed block grant, with the only funding provided by Congress at the commencement of the fiscal year, anything approaching full participation in a given State would cut benefits almost to the level of insignificance, and yet, over twothirds of these households targeted for assistance by Congress are facing these high energy costs without any aid whatsoever. The blow to the actual participating population is one they can hardly bear. This is a population with extremely limited incomes: 60 percent have annual incomes below $6,000 a year; roughly 37 percent are elderly and on fixed incomes; 15 percent are handicapped people. These participating households can often only compensate for the reduced LIHEAP benefits by foregoing some other critical expenditure. Also underscoring the value of the program is the fact that the majority of the participants receive no other form of public benefits, and that a significant percentage are working poor households, struggling just to keep up with inflation. Many LIHEAP eligible households are forced to do without heat at some point during the winter months, when funds are not available. For example, the National Low-Income Energy Consortium reported that 28 percent of all poor or near poor U.S. households go without heat for one or more days, because they are unable to pay their utility bills. And LIHEAP funding has continued to decrease. I note that for the coming fiscal year, President Bush has proposed to cut the LIHEAP program by an additional 25 percent. The LIHEAP program has been designed and redesigned by Congress to target only those in real need, and data provided by the Department of Health and Human Services indicates that those fortunate enough to receive LIHEAP benefits are actually among those with the highest burdens of energy payments. As we approach the 1990's, finding solutions to budget deficit problems, while retaining programs which benefit the truly needy, will not only challenge our creativity, but will serve to define our Nation's social conscience. Clearly, the LIHEAP program serves to define our Nation's social conscience. Over the years, it has been a valuable tool to help millions of needy families meet a basic human need. As we act to reauthorize the low-income home energy assistance program this year, we must rededicate the Federal commitment to this vital program, so that it can meet the needs of million of Americans who depend on it. I will now turn to my colleagues here at the table. Then I am going to ask Senator John Heinz to make his statement. Then we are going to turn to the first witness on our list, so I will ask you, James, to bear with us for a minute while we hear from Senator Coats, Senator Pell and Senator Heinz. Then I will be anxious to hear your remarks, as well. Senator Coats. OPENING STATEMENT OF SENATOR COATS Senator COATS. Thank you, Mr. Chairman. I want to join with you in welcoming our guests here today. I am especially pleased to see a fellow Hoosier, Larry Kleeman, from Tell City, IN. Welcome to all of you. I read with interest an article in the February 20, 1989 Washington Post which focused on the importance of the program which we are addressing here today. Its author noted that, for people who do not have money, a blast of winter stretches the lifeline very tight, skyrocketing fuel bills breaking skimpy budgets, old furnaces expire, children sleep in their clothes. Mr. Chairman, for many of these families, heat is a luxury they cannot afford. No family should have to choose between heat and food, yet this is a choice that is being forced on some families with children and the elderly. The low-income energy assistance program is one of those small, yet vital programs to help poor families meet essential needs, but it a program that has suffered the effects of an intractable Federal budget deficit. Federal LIHEAP funding has been declining steadily, from $1.83 billion in fiscal year 1987 to the current $1.393 billion. As a result, less than 30 percent of those who deserve assistance receive it. Mr. Chairman, we have a very full agenda today and it is important to hear what the experts and the families have to say, but let me add that I think it is unfortunate that the administration has proposed to further cut this program. The President's budget request of $1.05 billion is unacceptable. If those cuts were enacted, Indiana, which currently spends approximately $44 million per year for this type of aid, would have an appropriation of approximately $27.9 million. This represents a 54percent reduction since 1984 and would, according to our Governor, place upon our State the impossible choice between severely cutting benefits and reducing the number of households served. Mr. Chairman, I ask unanimous consent that a letter from the Hon. Governor Evan Bayh be placed in the record. Senator DODD. Without objection, it is so ordered. [The letter referred to follows:] LETTER FROM GOVERNOR EVAN BAYH OFFICE OF THE GOVERNOR Indianapolis, IN, March 26, 1990. The Honorable DAN COATS U.S. Senate SR-411 Russell Senate Office Bldg. Washington, DC. DEAR DAN: I am writing with respect to the FY 1991 Low-Income Home Energy Assistance Program Block Grant (LIHEAP) reauthorization and appropriation. I am very concerned that Indiana will be in a position of turning away numbers of low income, elderly and disabled households who seek our assistance next winter if the Administration's budget request of $1.05 billion is passed. As I am sure you know, Indiana has been blessed with relatively mild winters recently. However, we cannot be assured that this trend will continue. The last two years Indiana has operated a steady LIHEAP program, spending approximately $44 million per year. If the Administration's proposed $1.05 billion appropriation is enacted, Indiana will have an appropriation of approximately $27.9 million, a 54-percent reduction since 1984, placing our State with a difficult decision to severely cut benefits or reduce the number of households served. I urge your support of a $1.8 billion LIHEAP appropriation. We stand ready to provide whatever information you require to answer question regarding Indiana's administration of the LIHEAP Block Grant. Thank you in advance for your time, consideration, and support. EVAN BAYH Senator COATS. It is my sincere hope that the Appropriations Committee will consider this program very carefully and very thoughtfully and, in the end, do what is right for those families who so desperately need our help. Thank you. Senator DODD. Thank you very much, Senator Coats. OPENING STATEMENT OF SENATOR PELL Senator PELL. Thank you, Mr. Chairman. I want to thank you very much, indeed, for holding these hearings. Your efforts are appreciated by all of us, particularly in Rhode Island, where we have many of the same problems that face you in Connecticut, and we really need home heating assistance. I am also very thankful for the presence here of Mr. Buster Douglas, who is the world's champion boxer and I am very glad indeed to have met him. As the Chairman of the Subcommittee on Education, I am concerned with what he has done with student athletes and I know the importance of having good examples for student athletes to follow. Mr. Douglas is setting an important example here today with his work on behalf of those who need help. Also, in case I am no longer here, I thank Ms. Ruth Kavanagh, of Warwick, Rhode Island, for coming all the way from Rhode Island to tell her story today. It was not an easy winter in our State, nor your State, Mr. Chairman. Even now, it is still pretty cold. People who rely on Federal heating funds are often independent people, older citizens like Ms. Kavanagh. They are people who live on a budget, who need just a little amount of help to get by, when heating bills are a little bit more than were anticipated. So, we thank all of you who are here in this room and I thank you, Mr. Chairman. Senator DODD. Thank you very much. We are joined here today by Senator Heinz of Pennsylvania. We thank you, Senator Heinz. We are spending almost all of our day together. We chaired a hearing this morning on the Securities Subcommittee and I am delighted you can be here this afternoon before this subcommittee Senator Heinz. |