December 19, 2024
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THE COLD REALITY Resourcefulness aside, Mainers struggle with rising energy costs as aid is overdue

WASHINGTON – Dolly Jordan of Milbridge turns her furnace down low at night and pulls on extra blankets to help stay warm. Sometimes she has to get up in the night and turn the furnace up to “toast up” the house, but she always turns it back to low before returning to bed.

“That’s the way I keep going through the winter,” Jordan said in a telephone interview this week. “But I just feel sorry for the other people.”

Jordan’s story is not so different from those of thousands of other Mainers who struggle to conserve fuel and still heat their homes through the winter. They are resourceful and find a way to get by, and besides, there is always someone worse off.

But this year a combination of high oil prices and a federal budget battle threatens to leave many in the cold.

“It’s going to be hard, and if they don’t get the help they need, some people, old or young, aren’t going to make it,” Jordan said.

State administrators of the federal Low-Income Home Energy Assistance Program, or LIHEAP, are also worried.

“I am very concerned about what is going to happen in three weeks,” said Jim Baillargeon, director of energy and housing services at the Aroostook County Action Program.

Baillargeon works at one of 11 community action agencies across the state that process applications for the energy assistance program. He said his agency is processing about 60 applications a day.

“The phones are wild,” Baillargeon said in a phone interview.

Congress has yet to approve money for the program for fiscal year 2008, which began on Oct. 1. President Bush vetoed a bill that contained $2.4 billion for the program a month ago and the House failed to get the votes necessary for an override. Meanwhile, the program is operating at 75 percent of the funding level from last year until the new budget is approved.

LIHEAP was created in the 1970s in the face of the country’s first major energy crisis.

The federal government pays for the program in two ways. One portion of money is distributed to states based on a formula that takes into account the low-income population, the climate and energy costs. Another portion is set aside in an emergency fund to be distributed by the president at his discretion. The emergency funds can be released at any time, and often cold-weather states such as Maine receive a much greater proportion of the money.

Statewide, about 50,000 people are expected to receive a one-time federal benefit to help pay for their heating oil, according the Maine State Housing Authority, which distributes the money.

The 11 community action agencies pay participating oil dealers directly on behalf of the recipients. The oil is purchased at a bulk rate, about 7 cents a gallon cheaper than market price. The purchasing power of the benefit depends on the market price on the day participants order oil from the dealer.

Families whose incomes are less than 150 percent of the federal poverty level are eligible. If the family has members over age 60 or under age 2, the eligibility cutoff is 170 percent of the federal poverty level. For a family of four without young children or seniors, the qualifying household income limit this year would be $30,975.

Dan Simpson, spokesman for the state housing authority, said average benefits have varied in recent years from $479 to $685, based on federal policy changes. If the current level remains the same, the average annual benefit would be $579.

“As of last week, we’ve spent $13.2 million on oil so far,” Simpson said in a phone interview this week. He said the state has distributed the funds, which make up about half of what is available, to nearly 23,000 people so far. He said agencies now are processing 12,000 more applications.

But this year’s $579 average benefit is not going very far.

Jamie Py, president of the Maine Oil Dealers Association, said the average family uses about 850 gallons of heating oil a year, which at current prices would cost $2,700.

Mainers buy about 400 million gallons of heating oil each year, which at current prices is more than $1 billion, Py said.

Sen. Olympia Snowe, R-Maine, has been working with the rest of the Maine congressional delegation to increase funding for the program.

Snowe said of the $2.4 billion Congress has proposed, $450 million would be set aside for the emergency fund. Even though that is a $250 million increase in emergency funds over last year, Snowe and her colleague, Sen. Susan Collins, R-Maine, have joined more than 20 other senators in requesting another $1 billion in emergency funding.

“Listen, we could use far more than that,” Snowe said in an interview. “The need is probably a $5 billion need, given where we are today. With the historic increase there’s not just a burden; it’s a crisis.”

Home heating oil in Maine is 40 percent more expensive this week than it was during the same week in 2004, according to prices listed by the Maine Energy Resources Council. The state average is currently $3.18 a gallon.

Collins said she was not optimistic that oil prices would begin to fall over the winter.

“The cost is imposing a tremendous hardship,” she said in an interview. “It’s always difficult for low-income people, particularly elderly people on limited incomes, to afford home heating oil during the peak season, but this year is much worse.”

Collins and Snowe, along with Democratic Reps. Tom Allen and Michael Michaud, also have been pressuring the president to release the final $20 million left in last year’s budget for emergency heating aid funds.

Snowe said she had not heard back from the White House Office of Management and Budget. On Tuesday, Snowe, Collins and other senators from cold-weather states asked for a meeting with Jim Nussle, director of the OMB.

Sean Kevelighan, spokesman for the office, said in an e-mail statement that the request for the release of the $20 million is being reviewed. He noted that $131 million in emergency funds were released in September with Maine receiving $7.2 million.

If the remaining $20 million is released, Maine would receive about $1 million, according to Snowe.

But even if the remaining funds are released, Baillargeon said, it would result in only a $21 increase in the benefit per person.

“It’s a good thing to do to push the point, but it’s just not going to fix things,” Baillargeon said. “It’s frustrating.”

More than being frustrated with the political bickering that has held up the budget process, many Mainers are upset about the high fuel prices and their powerlessness to deal with them.

Gov. John Baldacci came to visit the delegation in Washington last week to discuss several ways to address the high energy costs, including legislation to increase oversight in the energy futures market to help stabilize crude oil prices.

A congressional report last year indicated that the presence of unregulated transactions on the crude oil futures market very probably resulted in inflation of $20 to $25 per barrel.

The report, by the Permanent Subcommittee on Investigations of the Senate Homeland Security and Governmental Affairs Committee, said large purchases of crude oil futures contracts by speculators have created an additional demand for oil, driving up the price.

Collins, the committee’s ranking Republican member, heard testimony from energy market officials during a hearing Tuesday. She said last week that she hopes to place this type of trading under the oversight of the U.S. Commodity Futures Trading Commission to help stabilize the price of oil.

The report said that despite record U.S. oil inventories, crude oil rose from a range of $25 to $30 a barrel in 2000 to $60 to $75 a barrel in 2006. In 2007, oil has risen above $90 a barrel.

“From what we are being told by the Government Accountability Office and the committee’s report, 50 cents to $1 per gallon of the cost of heating oil might be attributed to excessive speculation on the market,” Py said in a phone interview. “We’re trying to look out for our customers, and what we are being told is that this practice is driving up costs.”

Meanwhile, the agencies that distribute the home heating aid are being forced to cut back on staff.

The Aroostook County Action Program has already laid off one worker and has plans to lay off others. The Penquis program, which serves Penobscot, Piscataquis and Knox counties and fields more than 200 calls a day, had planned to lay off staff members but has decided to hold out a little longer to help process the requests.

“Having to lay off some staff is a huge concern a lot of … agencies have,” said Jennifer Giosia, spokeswoman for Penquis. “We aren’t sure if we will. We had originally planned to, but because we have so many applications to process, we won’t yet.”

And the longer it takes the agencies to process applications, the longer eligible families remain without assistance.

There is “nothing else we can do except hope and pray that this will turn around so that we can get through this winter,” Jordan said.


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