Economy

How Years Of Welfare Politics Is Leaving Thousands To Freeze This Winter

CREDIT: AP Photo/Robert F. Bukaty

As winter sets in around the country, thousands of the nation’s poor are struggling to keep the heat on thanks to intentional underfunding of a key federal progam.

Pennsylvania saw an 11 percent increase in applications for heating assistance but granted benefits to just 1 percent more households than last season. There are more than 24,000 households in the state going without normal utility service at the start of the coldest months, a 14-year high.

And in Idaho, state officials expect to assist at least 2,000 fewer households than last year after a streamlined process and more generous per-household benefits drained the state’s allotment of funds. The state “still has crisis funding available for individuals who have a crisis situation” later in the year, program administrator Kristin Matthews said in an email. But in the meantime, the state is encouraging low-income households left out in the cold to seek help from charities.

In both cases, the increase in people going without heating assistance for the winter reflects an unnecessary strain placed on the Low-Income Home Energy Assistance Program (LIHEAP) by Congress.

Precise eligibility rules for LIHEAP vary from state to state, but the law authorizing the program says that anyone with an income up to 150 percent of the federal poverty line is eligible as far as Congress is concerned. States may set that upper bound at 60 percent of the state median income if that amount is larger. No state can deny eligibility for benefits to households earning less than 110 percent of the federal poverty line.

But because Congress never puts enough money into LIHEAP to actually deliver on the ambitions of the program, plenty of people who are eligible for the aid go without it every year. Federal funding for the program has fallen by about a third since 2010 when it was an already-insufficient $5.1 billion, the Center on Budget and Policy Priorities’ David Reich said in an interview.

“It’s pretty clear that the LIHEAP appropriation [approved by Congress] has never come close to being able to serve all those eligible,” said Reich.

Programs like food stamps that are designed to automatically appropriate all funds necessary to serve eligible applicants are a relative rarity. Even the auto-funded food stamps system fails to reach everyone it should, because of how many people never apply for help they’re legally entitled to. But the under-enrollment problem is far more acute in most anti-poverty systems run by the government because lawmakers leave them in a state of perpetual under-funding.

Indeed, LIHEAP program has never served even one out of three households who are eligible under the federal legislative language, according to a Congressional Research Service report from December. The program managed to reach 31 percent of those federally eligible in 1983, the second year of LIHEAP’s existence. That share dipped all the way to 14 percent by 2000, before rebounding to right around 20 percent over the past few years of data.

That means that for every five homes Congress said it wants to help keep the heat on, four go without the intended aid.

“This situation is not uncommon in the federal budget world,” said Reich. “The childcare assistance programs are another example, and housing assistance is another. It’s not uncommon. Because it’s an appropriated program, it competes for funding annually with everything else in the non-defense appropriated world.”

Maintaining LIHEAP’s 2010 funding level would have added $1.7 billion in federal spending – less than one eighth of one percent of the $1.1 trillion in spending approved in December’s budget deal. Congress not only declined to spend that money – it actually intensified the crunch facing LIHEAP money through a related policy tweak in how eligibility for food stamps interacts with LIHEAP participation.

The decision to cut LIHEAP funding since the 2010 rebound in the program’s reach is especially cruel given what’s happened to fuel prices in recent years. Oil and natural gas prices have fallen significantly over the past two years, and the Energy Information Administration forecasts that it’ll be anywhere from 3 percent to 25 percent cheaper to heat homes this winter compared to last year, depending on the source of a household’s heat.

While falling energy prices help blunt the impact of the cuts, they also mean Congress could have reached a dramatically higher share of those in need by simply leaving the program out of the misguided anti-debt fervor that took over the federal government with the rise of the Tea Party.

“Hopefully the need has come down. But the reality is that LIHEAP has never served more than a fraction of those eligible by the federal standards,” Reich said. “And certainly another way that the program could respond to lower fuel costs is to serve more people, to get that fraction up a little bit.”

Instead, appropriators have forced administrators in Idaho, Pennsylvania, and elsehwere to choose who gets help and who goes without. Those workers make painful decision about how to allocate scarce resources in hopes of ensuring that the very neediest people are first in line. But the line is too long for everyone to get the help they’re meant to under U.S. law.

Such actions may represent the best outcome possible under the constraints Congress places on the people who administer the program, Reich said, while stressing that there isn’t really a right answer here.

“I would think the good government approach is to try to strike a balance between helping as many people as possible and helping people with the most urgent need,” he said. “But these are difficult choices. Usually the federal funding is pretty inadequate to take care of everybody who is eligible.”