April 1, 1977
Page 10114
Mr. MUSKIE. Mr. President, I urge passage of the Supplemental Appropriations Act of 1977, which includes $282.5 million for the Community Services Administration for weather related aid to low income families.
Part of this amount, $82.5 million, would be used to continue the CSA's weatherization program to help insulate and otherwise improve the fuel economy of low income homes. This program is designed to protect low income families from ruinous fuel bills in future winters.
But the remaining $200 million would be used to alleviate the lingering effects of this year's severe winter — more specifically, the enormous fuel bills that thousands of poor families have yet to pay.
The funds would be allocated to States, which in turn would provide eligible families assistance in paying their fuel or utility bills. Payment in most cases would go directly to the utility company or fuel oil dealer involved.
Just because the worst of the winter is over — and the relief of spring is upon us — does not mean that this winter's emergency can be forgotten.
In fact, nothing could be farther from the truth. Funds are needed now for the unpaid fuel bills accumulated this winter.
My Subcommittee on Intergovernmental Relations polled State utility commissions and utility companies recently and found that, typically, utility companies allowed financially strapped customers to accumulate fuel bills over the winter months, rather than discontinue service during severe weather.
This was due both to the independent decisions of companies — and I consider this a constructive exercise of corporate responsibility — and because many State utility commissions ordered temporary bans on service cut-offs.
Now, however, as the weather has warmed up, State utility commissions have relaxed these bans and companies have begun to discontinue service.
At the same time, many thousands of low income families are no more able to pay these accumulated bills than they were 2 months ago.
For example, my subcommittee found that a Wisconsin gas company recently sent out 25,000 disconnect notices to customers in the Milwaukee area, effective April 2, the day after the State commission's disconnect moratorium expires.
And this is just one example of an alarming and growing problem that will overcome the already strained finances of poor families — unless we can provide needed help immediately.
To give you an idea of the dimensions of the problems, let me add some information.
This winter was the coldest in 60 years, 40 percent colder than last year, and it affected States in virtually every section of the country.
Seven Governors declared states of emergency. Natural gas shortages idled over a million workers, and as far south as Dade County, Fla., crop damage ran into the hundreds of millions of dollars.
Nationally, energy consumption was 32 percent higher this winter than last, according to the Library of Congress. In New England, energy consumption was 25 percent higher.
With increased consumption came higher prices, as well.
Fuel oil customers in New England faced a 5 to7 cent-per-gallon increase since last summer, and natural gas prices across the country increased over 7 percent during the winter.
That resulted in a winter fuel bill of almost $1,000 for the average New England family.
In all, the Library of Congress estimates that the total heating bill for the Nation was $8.4 billion this winter, "a 49 percent increase nationwide over last year ... equivalent to an average of more than $139 per housing unit."
However, these financial burdens fall heaviest on those least able to pay. According to the Community Services Administration, energy costs have risen more than four times faster than average welfare payments since 1973. And even before this winter, many poor and elderly persons were paying 60 to 80 percent of their income for shelter and heat.
In order to meet the needs of those who have been unable to shoulder this burden, I and a number of my colleagues in both Houses began work several months ago to secure this supplemental appropriation for the CSA. Our plan is simply to provide the funds through existing authorizations to the CSA, which in turn would allocate the $200 million among the States. The Governor of each State would then be responsible for using the best delivery systems at his disposal to put the financial assistance into the hands of those who most need it.
In order to qualify, individual or family income would have to be within 125 percent of the poverty level. Further, the recipient would have to provide the administering agency with proof of need.
Each eligible household would be limited to a maximum payment of $250. This payment, for fuel, would be made directly to the utility company or fuel oil dealer. Eligible recipients could, however, receive a $50 cash payment for other energy related expenses resulting from this winter's cold.
The formula which has been developed to allocate these funds among the States is designed to target the assistance where it is most needed. It takes into account the severity of this winter's cold in each State, the number of those who need assistance in each State, and the relative cost of buying fuel.
So that my colleagues can see how the $200 million would be divided among the States, I ask that the allocation list by State be printed in the RECORD at this point.
[Table omitted]
Mr. President, earlier this year my Subcommittee on Intergovernmental Relations held hearings on this proposal and heard from Governor Grasso of Connecticut, Governor Carroll of Kentucky, Governor Shapp of Pennsylvania and Lieutenant Governor O'Neil of Massachusetts. These witnesses all supported the assistance proposal.
As Governor Carroll testified:
. . . in time of trouble, it is always the poor who suffer most. Kentucky is no exception. To a family who is just scraping by on a fixed income, unemployment insurance and food stamps, a fuel bill that is double or triple what they normally pay can be back breaking ... Federal programs that provide aid to these needy families don't have contingency clauses for days of subzero
weather and soaring fuel bills. We need a special kind of help — the kind that this committee is considering today.
In an effort to further determine the need for this kind of assistance in other States and how each Governor might administer this program, my Intergovernmental Relations Subcommittee wrote to each Governor. So far, we have received responses from 24 States. Each Governor from whom we received a response strongly endorsed the proposal. And almost all said that the funds were desperately needed in their State. I ask unanimous consent that these responses be printed in the RECORD.
I also ask unanimous consent that the complete text of the study of fuel bills and cutoffs prepared by my Intergovernmental Relations Subcommittee be printed in the RECORD.
Mr. President, this $200 million appropriation represents the best Federal/ State response to the financial disaster that this winter's severe cold has meant to so many people. It comes at the end of the winter, but at a time that it is needed by many of our citizens. I urge my colleagues to lend their support to this worthwhile proposal.
There being no objection, the responses were ordered to be printed in the RECORD, as follows:
[Telegram]
MONTGOMERY, ALA.,
March 9, 1977.
Hon. EDMUND S. MUSKIE,
U.S. Senate,
Washington, D.C.
Reference is made to your letter of March 1 concerning funding of a Federal program providing financial assistance to low income families unable to pay high fuel bills. It is my belief that this legislation is needed and I am responding to the questions contained in your letter as follows:
1. There is a need for financial assistance in Alabama for those unable to pay increased fuel bills.
2. These funds are still needed.
3. The community action agencies have been designated as the delivery system to provide such a system.
4. We can provide timely assistance if legislation is enacted and will assume accountability for this program. We are now completing our State plan and have conducted initial training of personnel who will administer this program. Furthermore, we are prepared to set our program in motion upon receipt of these funds.
Sincerely yours,
GEORGE WALLACE.
STATE OF ALASKA,
Juneau,
March 11, 1977.
Hon. EDMUND S. MUSKIE,
U.S. Senate,
Committee on Government Operations,
Washington, D.C.
DEAR SENATOR MUSKIE: It was my understanding that the federal program for emergency financial assistance for low income families unable to pay high fuel bills this winter was to be targeted for those states in the eastern U.S. experiencing unusually severe winter conditions this year.
Alaska has been having a warmer than usual winter this year; however, as you know, our usual winter weather conditions are much colder than what is experienced in the lower 48 states.
Normal Alaskan temperatures combined with very high and continually rising fuel costs inflict serious hardships on poor families in this state year after year.
My administration has, and will continue, to work for a more equitable distribution of federal funds for the energy needs of the poor which would give recognition to the special needs of low income Alaskans who regularly face the effects of extreme and long winters.
We do have an effective delivery system for winterization of homes and emergency bulk fuel loan assistance through Community Services Administration grantees in the State. Emergency fuel assistance funds could be immediately made available to those in need by those same grantees, were such funds available to Alaska. However, because of the "emergency" nature of these fuel assistance funds and because this year Alaska has experienced an unseasonably warm winter, Alaska is not seeking a portion of the special $200 million federal appropriation. It is our desire to see these emergency funds go to help poor families in the eastern and southern states suffering from one of the most difficult winters in their history.
Sincerely,
JAY S. HAMMOND, Governor.
[Telegram]
SACRAMENTO, CALIF.,
March 14,1977.
EDMUND S. MUSKIE,
Chairman, U.S. Senate,
Committee on Governmental Operations,
Subcommittee on Intergovernmental Relations,
Washington, D.C.
The request for funds to assist low income families unable to pay high fuel bills accumulated during the bitter cold winter would not be applicable to California at this time due to unusually dry and moderate temperatures. However we do support this action for areas where the need has been demonstrated. California is in the process of evaluating the high cost of energy due to the severe drought conditions.
STEVEN YBARRA, State of California, Health and Welfare Agency.
STATE OF IDAHO,
Boise,
February 4, 1977.
Hon. EDMUND MUSKIE,
Special Energy Committee,
U.S. Senate, Senate Office Building,
Washington, D.C.
DEAR SENATOR MUSKIE: It was heartening to hear your recently televised statement that there is a possibility that Federal funds will be made available to assist low income people with their fuel needs.
Here in Idaho we are having a colder than usual winter with its attendant problems for persons with low incomes. We can only imagine the hardships faced by persons with limited means as they try to cope with the viciously severe weather being experienced in the eastern sections of our nation. While our public and private agencies are severely strained trying to assist people to secure and maintain fuel supplies we know that some of our fellow Governors and citizens are faced with fuel problems of catastrophic proportions.
We urgently request that you make every effort to make funds available to assist low income people to secure adequate fuel in this severe winter. Such funds should be made available in proportion to need based upon population and severity of weather and be made available as quickly as possible to those States facing the most severe problems.
Sincerely yours,
JOHN V. EVANS, Governor.
OFFICE OF THE GOVERNOR,
Indianapolis, Ind.,
March 7, 1977.
Hon. EDMUND S. MUSKIE,
U.S. Senator,
Washington, D.C.
DEAR SENATOR MUSKIE: The following is in response to your letter of March 1, 1977, regarding Federal Crisis Intervention Legislation to provide financial assistance to low income families to pay high fuel bills accumulated during the bitter cold this winter.
1. Very definitely. The Indiana Office of Community Services Administration has already served more families with Crisis Intervention assistance in December and January than was served in all of the previous year. Present funds have been depleted and other program funds have been diverted to meet the need, with no assurance of replacement funds.
Indiana has 145,384 families (11% of state) at or below the 125% low income level. The following projections have been made:
[Table omitted]
The Indiana Community Action Program Executive Directors have requested $20,000,000 of Emergency Energy Assistance funds to meet the emergency energy needs of low income Hoosiers.
2. The need still exists and will continue during the next 3 to 6 months in order to pay bills in arrears and reestablish credit with fuel suppliers. Many low income families are on deferred payment plans and will continue to pay excess bills each month.
3. Indiana has designated the Office of Community Services Administration to administer this program. A delivery system is in place to cover all 92 counties.
4. Indiana has spent considerable time and energy to provide this form of assistance to our citizens. The delivery system assumes optimal accountability of funds, verification of income and need.
I am confident that Indiana is prepared to insure that this program successfully meets the needs of our low income citizens. Your sponsorship of this legislation is greatly appreciated.
Kindest personal regards,
OTIS R. BOWEN, M.D., Governor.
OFFICE OF THE GOVERNOR,
Des Moines, Iowa,
March. 21, 1977.
Hon. EDMUND S. MUSKIE,
Committee on Government Operations,
Subcommittee on Intergovernmental Relations,
U.S. Senate,
Washington, D.C.
DEAR ED: I would like to acknowledge your letter of March 1 concerning financial assistance to low income families unable to pay high fuel bills. To answer your specific questions, there is some need for financial assistance to poor and near poor families and individuals in Iowa who were unable to pay increased fuel bills during the past winter. Our Community Action Agencies have been using part of their weatherization funds from the Community Services Administration for this purpose. They have also negotiated with fuel suppliers for installment payments of back bills in cases where families were able to do so.
While some of the needs have been alleviated already, it is still possible to provide meaningful assistance. However, it seems more fair to expand emergency assistance to low income families who have paid their utility bills but were forced to sacrifice in another area.
If provided with federal funds we would rely on my Office for Planning and Programming, in which the State Office of Economic Opportunity is located, to coordinate the effort. This office has been working with the Community Action Agencies on weatherization and the fuel crisis intervention program. It also provides state money for weatherization and has furnished Comprehensive Employment and Training Act enrollees to help with the program. We would expect to continue to use the Community Action Agencies' delivery system with, perhaps, referrals from the county social services departments and area agencies on aging.
We are confident that Iowa can provide this assistance in a manner to assure accountability and timeliness.
Sincerely,
ROBERT D. RAY, Governor.
[Telegrams]
TOPEKA, KANS.,
March 16, 1977.
Senator EDMUND MUSKIE,
Capitol D.C.:
In regard your letter 3-1-77: fuel bill assistance needed for low income Kansas, can be distributed through increase in GA, AFDC, SSI grants within 15 days of notice. Cannot supply verification that funds are spent specifically on fuel bills, more likely increase will replace food money spent on fuel earlier in year.
ROBERT F. BENNETT, Governor of Kansas.
GOVERNOR OFFICE,
Frankfort, Ky.,
March 11, 1977.
Hon. EDMUND S. MUSKIE,
U.S. Senate,
Washington, D.C.
DEAR ED: We appreciate the efforts on the part of you and your colleagues to alleviate some of the problems incurred by our low income citizens as a result of this winter's inclement weather, we are very hopeful that you will be able to secure funding to assist in fuel costs to these families. In response to the specific questions you posed:
1. There is no doubt that a need still exists for financial relief to low income families to compensate for their increased fuel bills.
2. The impact of the high cost of recent fuel bills will mean that low income budgets will be severely restricted for several months if some financial support is not provided. Although the intended benefits of this program would be delayed, provisions of assistance at this time would still be meaningful.
3. Should federal funds be provided, the existing welfare payment systems or offices would be utilized.
4. I have been assured by the department for human resources that they will have the capability of providing this special assistance to active welfare recipients through its regular payment system and in taking applications for non-recipients through its local office structure which is available : in every county in Kentucky.
Please feel free to contact this office if we can be of further assistance in your endeavors.
Sincerely,
JULIAN M. CARROLL, Governor of Kentucky.
AUGUSTA, MAINE,
March 4, 1977.
Senator EDMUND S. MUSKIE,
Capitol One, D.C.:
Your letter of March 1, 1977, to Governor Longley has been forwarded for attention. On item 1, yes, definitely. Item 2, yes, still needed, not too late. Item 3, local community and State resources already in existence, Item 4, most certainly.
DAVID E. SMITH, Commissioner of Human Services.
STATE HOUSE,
Boston, Mass.,
March 7, 1977.
Senator EDMUND S. MUSKIE,
Committee on Government Operations,
Subcommittee on Intergovernmental Relations,
Washington, D.C.:
In response to your question concerning the $200 million emergency appropriation:
1. There is definitely a need for financial assistance to low income families and individuals because of increased fuel bills this winter. The combination of higher energy prices and a colder than average winter has caused hardship for both the poor and the near poor.
2. Funds are still needed: (A) Social service agencies often expended other program money to assist families during the coldest weather and should be reimbursed for these costs. (B) Utility companies and oil retainers have often been reluctant to cut off service during the middle of winter. Unless bills in arrears are paid, many families will now be cut off.
3. Massachusetts will use its existing network of community action agencies and the State welfare department to deliver funds.
4. This network has been in use for a number of years. It is accountable and effective and will be able to ensure a timely delivery of assistance to those most in need. There are already established procedures for handling emergency fuel requests, and this network has been shown to be the most effective system for our State. As an example, the network was able to deliver 300,000 gallons of donated oil to needy households in February.
Sincerely,
MICHAEL S. DUKAKIS, Governor, Commonwealth of Massachusetts.
MARCH 9, 1977.
Senator EDMUND S. MUSKIE,
Committee on Government Operations,
the Senate,
Washington, D.C.
Thank you for your letter regarding the proposal for Federal financial assistance to low income families to help offset their high heating fuel bills. We have clearly defined the need for such assistance in Michigan, estimating that roughly 260,000 households are below the poverty level and budget for their own fuel needs.. The average annual fuel bill this year will be about $100 above last year's total. Financial assistance to these most vulnerable households is still needed and could efficiently be provided through theState Department of Social Services. The relief could most efficiently be provided through direct vendor payments to the utilities, if Congress grants the States that authority. I can assure you that Michigan has an administrative structure geared to channeling this support quickly, effectively, and accountably to those low income households most in need. Again, the scale of the problem, and its national impact dictates that Federal action be taken, and if there is anything that my office can do to assist you in winning congressional approval of the program, please let me know.
WILLIAM G. MILLIKEN, Governor of Michigan.
MARCH 11, 1977.
To: David Johnson.
From: Cindy Warren.
Subject: Fuel Assistance.
I received a telephone call today at 10:00 a.m. from Herman Wells on behalf of Governor Finch (Miss.) concerning the fuel assistance questionnaire. In response to your questions as follows:
1. Yes.
2. No, it's not too late.
3. CSA.
4. Yes he is confident the funds would be used with accountability. Their delivery system is well established.
EXECUTIVE OFFICE,
Jefferson City,
March 9, 1977.
Hon. EDMUND S. MUSKIE,
The United States Senate,
Russell Senate Office Building,
Washington, D.C.
DEAR SENATOR MUSKIE: As Governor of Missouri, I heartily endorse your proposal to appropriate two hundred million dollars for emergency aid to help low income persons pay their heating bills.
Missouri has been especially affected this past winter as it has been one of the coldest winters in the state's history. Consequently, customers of utilities in this state have incurred very large heating bills.
I realize that your proposal is a short term solution to a long term problem, but I feel that your proposal will bring relief to those people most in need. Also, it is unlikely that the combination of factors, the cold winter and the FPC Opinion 770, will occur again, at least in the foreseeable future.
I endorse your proposed appropriation and qualified utility customers in Missouri look forward to benefiting from this appropriation as soon as possible.
Again, thank you for your help.
Sincerely yours,
JOSEPH P. TEASDALE, Governor.
STATE OF NORTH CAROLINA,
Raleigh,
March 16, 1977.
Senator EDMUND S. MUSKIE,
U.S. Senate,
Russell Senate Office Building,
Washington, D.C.
DEAR SENATOR MUSKIE: I appreciate the opportunity to comment on the proposed $200 million appropriation to provide financial assistance to low income families faced with inordinately high winter fuel bills. Our responses to the four questions posed in your letter of March 1 are summarized below.
(1) There is a definite need for an appropriation of this kind. A recent sample survey of local agencies in North Carolina indicated that there were still a considerable number of low income families experiencing difficulties in paying their fuel bills.
(2) The immediate need for these funds has decreased in the past several weeks. However, there is still a residual need as indicated above. I would question whether or not the proposed $200 million could be spent effectively in a limited period of time. A smaller appropriation might be in order or the Congress may wish to appropriate the full amount with the provision that it remain available until expended. This would allow us to respond quickly to any similar emergencies next year.
(3) Fortunately, we have several program delivery systems at our disposal. Seventy-eight of our one hundred counties are served by Community Action Agencies and this year through a state level Economic Opportunity office we expect to be providing low income energy assistance to the other twenty-two counties. These agencies have played an important role in the Federally assisted low income home weatherization program. Each county in the state is also served by a department of social services. Collectively, these agencies have an effective outreach capability and considerable experience in dealing with the needs of lower income families.
(4) I believe we have the capacity to maintain accountability and to deliver these services in both a timely and effective manner. I would urge the Congress to allow states to choose among existing delivery mechanisms in administering this program. I would also suggest that the Congress make every effort to assure that the low income home weatherization program which was authorized by the 94th Congress as part of the Energy Production and Conservation Act be implemented as soon as possible. Swift action on this program will permit us to spend this summer winterizing the homes of low income families. We hope to use this approach to avoid some of the hardships experienced this winter.
Your consideration is greatly appreciated.
JAMES B. HUNT, Jr., Governor.
[Telegram]
Hon. EDMUND S. MUSKIE,
U.S. Senate,
Washington, D.C.
Answers to questions regarding Federal fuel assistance program—
1. Not a great need now in North Dakota some aid would be appreciated.
2. Funds will be needed to offset economic conditions of the poor in light of worsening drought conditions.
3. The Division of Economic Opportunity is in conjunction with CAP's and social services will administer funds.
4. North Dakota State Government will assure both accountability and timeliness. Letter to follow.
ARTHUR L. LINK, Governor of North Dakota.
[Telegram]
Hon. EDMUND MUSKIE,
U.S. Senator,
Committee on Government Operations
Subcommittee on Intergovernmental Relations,
Washington, D.C.
In response to your questions concerning congressional appropriation of $200,000,000 for financial assistance to the poor unable to pay increased fuel bills the following replies are given:
1. There is a definite need in New Mexico for financial assistance to poor and near poor in payment of increased fuel bills this winter. In the previous year, New Mexico community action agencies assisted 4,020 families in payment of utility bills. At least the same number of families are still critically in need of such help.
2. New Mexico's northern counties experienced inclement and harsh weather conditions through late spring months, therefore such assistance is still badly needed.
3. Such funds received by New Mexico would be channeled through the office of the Governor.
4. I am confident that this arrangement would insure accountability and timeliness in the delivery of these vital services. In the event that we are given a short time period within which to expend the funds, it may be necessary to enlist the support of other social services delivery programs to assist in the distribution of such assistance. Dependent on the amount of funding to be allocated to New Mexico, we may be unable to expend the funds within a specified time limit. In this case, provision should be made for funds to be carried over until the need for such assistance increases during the fall and winter months.
The New Mexico State Legislative has displayed a willingness to commit state resources to emergency energy conservation efforts through appropriation of $250,000 for winterization which does not allow for crisis intervention. Funding made available through your legislation would complement the services made available through the legislative appropriation. In order to fully evaluate our role in administering these funds, we would appreciate being advised of the approximate dollar amount that New Mexico would receive.
JERRY APODACA,
Governor, New Mexico.
(Telegram )
Senator EDMUND MUSKIE,
U.S. Senate,
Washington, D.0
Ohio strongly supports your proposal to provide assistance to low income families in meeting the unusually high costs of heating this winter. I urge that you consider raising the proposed amount per family from $250 to $350. This additional amount will cover other emergency assistance such as furnace repair, repair of broken water lines, and associated repairs. Please consider also the plight of our elderly citizens dependent upon social security benefits. This group will also require assistance. Cases have been reported wherein the heating costs alone has exceeded the total funds available to these elderly citizens.
JAMES A. RHODES, Governor of Ohio.
(Mailgram]
Hon. EDMUND S. MUSKIE,
U.S. Senate,
Washington, D.C.
DEAR SENATOR MUSKIE: Thank you for your kind letter. I appreciate your concern for the severe impact that the winter has had, particularly on the poor and those with fixed incomes.
Here in Oklahoma we have already begun moving in the direction which you propose. Three weeks ago, I recommended to the legislature that the monthly state supplemental grant be increased to adult categories of assistance and AFDC households. Hopefully this will help meet some of the financial problems created by rising fuel costs.
In answer to your question, there is a definite need for financial assistance in Oklahoma. Any funds which the Federal Government could provide would give meaningful assistance to those in need. If Federal funds are made available, I am confident that the welfare dept. will use current delivery systems to get the most effective use of the monies, while insuring both timeliness and accountability.
Thank you for your consideration and concern.
Sincerely,
DAVID L. BOREN, Governor, Oklahoma.
[Telegram)
HARRISBURG, PA.
Hon. EDMUND S. MUSKIE,
U.S. Senate,
Capitol One, D.C.:
Responding your March 1st letter regarding financial assistance to low income families unable to pay high fuel bills:
1. There is need in Pennsylvania for financial assistance to poor families unable to pay increased fuel bills.
2. These funds still needed and can be used in meaningful ways.
3. Pennsylvania would use its public assistance system for distribution of these funds.
4. We can provide this assistance in timely manner with full accountability.
MILTON J. SHAPP, Governor.
STATE OF RHODE ISLAND AND PROVIDENCE PLANTATIONS,
Providence, R.I.,
March 15, 1977.
Hon. EDMUND S. MUSKIE,
Chairman,
Subcommittee on Intergovernmental Relations,
Washington, D.C.
DEAR SENATOR MUSKIE: In reply to your letter of March 1, 1977 requesting information to assist you in preparing an informational package for backup documentation on the 200 million dollar appropriation for state governments under the Community Services Administration program, my staff has prepared the following responses:
(1) There is a great need in my state for financial assistance to the poor and near-poor families who are unable to pay fuel bills. Through our Department of Community Affairs, we operate a monumental Crisis Intervention Program to prevent many families from utility and oil shutoffs. We initially received $98,000 from the federal government. Our State legislature appropriated an additional $300,000. We also had a statewide private contribution program called Project HEAT (Heat Emergency Action Team) which accumulated $256.000 and the Division on Aging allocated $37,800 for Crisis Intervention. This is a grand total of $691,800. We prevented about 8,000 shutoffs.
(2) Funds are still needed and it is not too late to provide meaningful assistance. At the writing of this letter, we are not in the grips of a severe cold spell. However, many of these families over the course of the next few weeks are going to be faced with a utility shutoff or an oil shutoff due to the lack of funds. Meanwhile, our Crisis Intervention Program only allowed us to provide enough money to keep the utility on or oil in the tank. It did not allow us to pay back bills. It is not uncommon, as a result of this, that many of these people have enormous back bills ranging from $200 to $500. Because of these back bills, the utility companies will shut off if payment is not forthcoming. This will of course leave them without heat for the balance of the spring and into next winter because they certainly will not be able to accumulate the money they will need to have their utility turned on. Any additional funds will at least allow the families to get out of debt and start over fresh.
(3) Our existing delivery system used our local Community Action Agencies to disburse the money, take care of the intake, and determine the need of the families. Due to the extreme amount of need, our agencies had to forego most of their other activities in order to provide this assistance. The Community Action Agencies were just not equipped to handle the number of families who were in need. We developed a system in Providence that allowed us to utilize our State Welfare Department to assist in qualifying families in need. I believe that our Community Action Agencies and our State Welfare Department would be able to handle this type of program and provide maximum service to those in need.
(4) I can assure you that our system will provide accountability and promptness in disbursing the money because we have been involved in this program for the past four years, and we have demonstrated both accountability and efficient delivery of services to our needy families in Rhode Island. This program has been operated throughthe Department of Community Affairs, Division of Human Resource Development, and any additional information can be obtained through Mr. Frederick C. Williamson, Director, Department of Community Affairs. His telephone number is (401) 277-2850.
Sincerely,
J. JOSEPH GARRAHY, Governor.
[Telegram]
Senator EDMUND MUSKIE,
U.S. Senate,
Capitol One, D.C.
Your March 1, 1977 letter regarding financial assistance for fuel bills of low income families.
Question 1. Need exist particularly if funds could be used to pay the crude bill.
Question 2. Funds still needed and it is still not too late to provide meaningful assistance.
Question 3. Social welfare and community action systems which would assure both accountability and timeliness.
Question 4. Yes.
Gov. RICHARD A. SNELLING,
State of Vermont.
[Mailgram]
Senator EDMUND S. MUSKIE,
Chairman,
Subcommittee on Intergovernmental Relations,
U.S. Senate,
Washington, D.C.
Governor Godwin has asked me to respond on his behalf to your letter of March 1 concerning proposed legislation which would provide financial assistance to low income families to pay high fuel bills accumulated during the winter months. As you know, Virginia was one of the States hard hit by the severe winter.
Although there were funds available in Virginia to provide emergency fuel assistance from several sources, a quick survey has indicated that most of the resources have been depleted. Information provided from community action agencies, State agencies and public utilities indicate that a need exists in Virginia. Some families in need can be readily identified in that they have delinquent fuel or utility accounts. Other families have paid their large fuel bills and are unable to adequately meet their food, housing, insurance, health and other needs.
While funds are needed in Virginia the delay in congressional action will make the program extremely difficult to administer. Certification of need will be especially troublesome.
Should Federal funds become available Virginia will continue to utilize a mechanism which includes local welfare departments, community action agencies, area agencies on aging and other local service providers.
I am confident that assistance could be provided insuring the accountability of the administering agency. The timeliness of our actions will depend upon the length of time it takes for legislation to be passed and signed by the President as well as the degree of flexibility and practicality present in the legislation and program guidelines. Obviously it will be a relatively simple matter to determine eligibility for those families and individuals who have delinquent fuel or utility accounts on record. We should also consider serving those persons in need who no longer have a fuel problem but rather a housing or health problem aggravated by their attention to their fuel bills. Determining their eligibility may be a long and arduous task.
MAURICE B. ROWE, Secretary of Administration and Finance, Office of the Governor.
[Telegram]
CHARLESTON, W. VA.
Hon. EDMUND MUSKIE,
U.S. Senate,
Washington, D.C.:
Thank you for your letter to discuss plans to appropriate $200,000,000 to assist low income families to pay high fuel bills.
This is a worthwhile undertaking, because almost every family has felt the economic pinch caused by excessive heating costs during the extreme winter weather this year.
In response to your specific questions, I would like to provide the following:
(1) Welfare Commissioner Leon Ginsberg advised that emergency fuel funds were adequate to assist most families with desperate needs through February. More money could be used and applied, but some relief was available to those who sought assistance.
(2) Since heating bills are still being received by our citizens, additional relief would be welcomed, and the Department of Welfare is still receiving requests for emergency assistance.
(3) We would use any additional funds through the Department of Welfare, working in conjunction with community action agencies. I am advised, however, that these agencies serve only 41 of our 55 counties.
(4) There is some question about ability to provide accountable and timely relief through existing welfare mechanisms. Dr. Ginsberg specifically requests that SSI recipients be included in such relief, since no direct assistance is offered to persons in West Virginia by the State.
We would endeavor to obtain such accountability in any special program, and I am sure that this could be done, since funding processes would be different.
GOV. JOHN D. ROCKEFELLER IV,
State of West Virginia.
STATE OF WISCONSIN,
OFFICE OF THE GOVERNOR,
Madison, Wis.,
March 14, 1977.
Hon. EDMUND S. MUSKIE,
U.S. Senate,
Committee on Government Operations,
Subcommittee on Intergovernmental Relations,
Washington, D.C.
DEAR SENATOR MUSKIE: Thank you for your letter of March 1 regarding the congressional proposal to appropriate $200 million for state governments to provide financial assistance to low income families unable to pay high fuel bills accumulated during the bitter cold this winter.
As you will recall, we presented testimony to your committee on February 3 in support of such a program and have worked with Representative David Obey from the 7th Congressional District in Wisconsin to get the proposal introduced in the House of Representatives. We were disappointed, of course, in the outcome of the House Appropriations Committee vote on March 10 and support Mr. Obey's efforts to have the appropriation restored by the full house.
Our response to your specific questions regarding this proposal are as follows:
1. Is there a need in your state for financial assistance to poor and near poor families and individuals who are unable to pay increased fuel bills this winter?
As we indicated in our testimony for your committee, the average cost of all heating fuels in Wisconsin increased 54% between January 1976 and January 1977. In addition, the heating season has been 29% colder this year than previous year resulting in a 29% increase in fuel use for space heating as a result of the bitter cold. Recent statistics suggest that approximately 10,500 Wisconsin households have requested emergency fuel assistance this winter with thousands more crises forestalled by a Public Service Commission moratorium on shutoffs by regulated utilities.
2. Are these funds still needed, or is it too late to provide meaningful assistance?
The above mentioned moratorium expires on April 1, 1977 and we anticipate many more crises with several months of the heating season still ahead in Wisconsin. During the winter of 1976, over 5,000 households were affected by the expiration of that year's moratorium and the increased cold coupled with the 62% increase in the price of natural gas can be expected to significantly increase that number in three weeks when the current order expires.
3. If provided Federal funds, what existing delivery system would your state use to make assistance available to those in need?
In Wisconsin, the state is the grantee for the current Community Services Administration weatherization/emergency fuel assistance programs and has contracts with all of the Community Action Agencies in the state for administration of the program on a statewide basis. We would anticipate continued utilization of that delivery mechanism for the proposed program.
4. Are you confident that your state government could provide this assistance in a manner that assures both accountability and timeliness?
Because the program is already administered on a contractual basis in the state and because we have an existing formula for distribution of funds within the state, we would expect to be able to make the funds available by amendments to our existing contracts as quickly as we receive them.
We held a training program for all Community Action Agencies on February 24, 1977 to acquaint them with the proposed procedures they will be expected to follow to assure both timeliness and accountability if these funds become available.
Thank you again for your concern in this very important matter.
Sincerely,
PATRICK J. LUCEY,
Governor.
FUEL BILLS AND FUEL CUTOFFS
(A survey of the impact of this winter's below normal temperatures on utility customers, by the staff of the Subcommittee on Intergovernmental Relations of the Governmental Affairs Committee, Mar. 21, 1977)
INTRODUCTION
In order to determine the plight of people unable to pay their fuel bills this winter, the staff of the Senate Subcommittee on Intergovernmental Relations surveyed 48 State utility commissions and 46 utility companies in 44 States. The survey was conducted by telephone during the period between February 16 and March 18, 1977.
SUMMARY
In summary, the subcommittee staff found that
1. There is substantial evidence that amounts owed utility companies in unpaid fuel bills have increased dramatically this winter over last;
2. There is evidence that, in many States, utility companies substantially reduced the number of utility consumers cutoff for failure to pay during the height of the winter, but there is a growing indication that cut offs will increase this spring;
3. Twenty-eight States have no regulations or agreements with utility companies which prohibit cutoffs of utilities for failure to pay;
4. Only 11 States have regulations which prohibit utility cutoffs for failure to pay; and
5. Eight States have informal agreements with utility companies which have the effect of limiting cutoffs.
BACKGROUND
This winter's cold has resulted in much higher energy consumption throughout the nation — 23 percent higher than last year. Also, throughout this winter, energy prices have continued their upward spiral.
This combination of higher prices and increased consumption has caused utility bills for residential consumers to skyrocket. The Congressional Research Service of the Library of Congress estimates, in fact, that U.S. consumers will spend $8.4 billion more to keep warm this winter than last — an average increase of $139 per household.
Such dramatic increases in fuel bills have inevitably led to an increase in the number of families and individuals unable to pay them.
THE STUDY
As was indicated above, this staff study is based on data collected from two sources — State utility commissions and utility companies. The survey of State commissions was conducted first, during the week of February 16-23. In this survey the subcommittee staff tried to collect information about commission rules and regulations on utility cutoffs as well as information about the number of cutoffs and the amount owed utility companies this winter. While the State commissions were able to provide information about their own rules and regulations, they had little information about the number of cutoffs and the amounts owed utilities.
To collect this additional data, the subcommittee staff began a telephone survey of large utility companies. An effort was made to contact at least one such company in each State. Data from 46 companies in 44 States are included in the study.
For the purpose of this study the subcommittee staff was only able to contact a limited number of electric and gas utilities. And while this staff survey does not represent a scientific sample of the gas and electric utility companies, it does include sufficient information to draw conclusions about broad trends.
Further, it is important to note that this survey only includes information about residences heating with natural gas and electricity. It does not include information about homes heated by other fuels such as coal and fuel oil. Because these fuels are often distributed by small dealers, the staff concluded it would be difficult to ascertain reliable data about them. In all, more than one-fourth of the homes in the nation are heated by fuels other than gas and electricity, mostly number 2 fuel oil.
The poor rely even less on natural gas and electricity for home heating than do more affluent segments of the population. According to statistics compiled by the Washington Center for Metropolitan Studies, 54% of the poor use natural gas for home heating, 8% use electricity, 23% use fuel oil including kerosene, 9% use bottled gas, and 9% use other fuels or none. (The different fuels add to more than 100% because some households use more than one fuel for heating.)
All of this means that this study represents only a portion of the problem that resulted this winter.
THE SURVEY OF STATE UTILITY COMMISSIONS
State governments have broad powers to regulate the activities of utility companies. Through State utility commissions, almost every aspect of utility activity is scrutinized and controlled.
The staff began its efforts to determine the effects of this winter's severe cold on utility customers by surveying the State utility commissions with the questionnaire below. The staff was able to obtain a response from States with its telephone survey. However, as mentioned before, the State commissions were in general unable to answer questions about amounts owed utility companies and the number of cutoffs made by utilities this winter. So, only questions 1 and 2a, b and c are treated in this part of the study.
THE QUESTIONNAIRE
(1) Has your commission ordered a moratorium on utility disconnects for failure to pay bills this winter?
(2) If yes, (a) When was it first put into effect?
(b) When will it expire?
(c) Has any such action ever been taken previously in your State?
(d) How many consumers have been affected by the order (that would have had their utilities cut off otherwise)?
(e) How much money is owed to the utilities because of this order?
(f) What percentage of consumers in your State use fuels whose suppliers are not covered by your commission?
STATES WITH NO REGULATIONS AGAINST UTILITY CUTOFFS
The following twenty-eight States reported that they have no regulations prohibiting utility cutoffs—
Arizona, Arkansas, Colorado, Delaware, Florida, Idaho, Iowa, Indiana, Kansas, Louisiana, Michigan, Missouri, New Hampshire, Nevada, New York, North Carolina, North Dakota, Oregon, Rhode Island, South Carolina, Tennessee, Texas, Utah, Vermont, Washington, West Virginia.
While these States have no moratorium regulations, seven — Idaho, South Carolina, Vermont, Maryland, New Hampshire, West Virginia and Texas — indicated that utilities must give notice or contact the Welfare Department before cutting off service. This barrier serves as a cushion and gives some consumers the opportunity to take advantage of programs designed to assist those unable to pay their bills.
Michigan prohibits cutoffs for families with illness.
Three of these twenty-eight State commissions — Tennessee, Iowa and Indiana — said that utilities in the States were attempting to help people faced with enormous fuel bills by allowing them to pay out their accounts over an extended period. While no other specific information was collected, there is evidence that this practice exists in many other States.
Two State commissions, Missouri and West Virginia indicated that at the time the study was conducted they were considering regulations which would prohibit utility cutoffs for failure to pay bills.
STATES WITH REGULATIONS PROHIBITING CUTOFFS
Alabama, Illinois, Mississippi (only a resolution urging no cutoffs), New Jersey, Wisconsin, Ohio and Pennsylvania have taken action this winter to prohibit fuel cutoffs this winter. Four other States, Oklahoma, Maine, Minnesota and South Dakota have had rules which prevent cutoffs under certain circumstances existing before this winter.
Typical of those States which acted this winter to prohibit cutoffs, is the short duration of the moratorium periods. In Illinois, the moratorium lasted 15 days, from February 1 to February 15 and has since been replaced by a voluntary program. In Alabama, the moratorium ran from January 18 to February 15. Mississippi's action, which was in the form of a resolution urging utilities not to be cut off covered only the month of February. New Jersey's regulation was put in plan January 31 and was in effect until March 1. Ohio's runs from January 23 to the end of March. Wisconsin's regulation covers the period between November 30 and April 1. Only Pennsylvania has regulations which will stay in effect until removed by the Commission. The Pennsylvania rule took effect January 18, 1977.
Those States which are relying on regulations put in place before this winter, have more general prohibitions on disconnects which do not expire. Oklahoma, for example, prohibits cutoffs when the temperature is below 10 degrees or on weekends. Minnesota prohibits cutoffs at temperatures below zero. South Dakota, simply prohibits cutoffs during the winter months.
STATES WITH INFORMAL AGREEMENTS WITH UTILITY COMMISSIONS
Eight States, California, Georgia, Kentucky, Massachusetts, Montana, Virginia, Connecticut and New Mexico have, as was characterized by the Montana Commission—"Gentlemen's Agreements"—not to cut off service during the cold months.
The Massachusetts example is fairly typical. In Massachusetts, no actual rules against cutoffs have been made. But, the utility companies have "promised" not to turn off residential users. This promise notwithstanding, the Commission reported that the utilities "retain the rights to threaten."
None of the States with these informal agreements with utility companies indicated that they monitored the activities of the companies in this regard.
(Attached is a company by company breakdown of the information provided the subcommittee by each utility company responding with substantive information to the subcommittee's telephone survey.)
THE SURVEY OF UTILITY COMPANIES — AMOUNT OWED
The subcommittee staff found that utility companies in 28 States are owed more this winter than last. The average increase in these 28 States was found to be 34.12%. In some States, Illinois for example, the increase was relatively minor — 3.39%. But in others, the increase in amounts owed is dramatic. In Ohio, Pennsylvania and Utah the increase is approximately 41%. In Louisiana the increase is 57% and in Kansas, the utility company is owed 72% more this winter than last.
The staff found that eight States had the amounts owed decreased. In general, these decreases were small; averaging only 3.32%. The largest decrease in amounts owed was found in the Idaho utility company which had a decrease of 4.1%.
The staff found four States which reported that accounts receivable were the same this winter as last.
No figures were available from 12 States which were contacted by the staff.
From this information the staff has concluded that amounts people owe for fuel bills are much higher this winter than last, particularly in those States which experienced colder than normal temperatures this winter. Reinforcing this conclusion is the fact that of those eight States that reported to the subcommittee that their accounts receivable had decreased, six — Arizona, Montana, North Dakota, Oregon, South Dakota and Idaho — had above normal temperatures for most of this winter. Another of the eight, Illinois, attributes its decrease in accounts receivable to a widespread and sophisticated media program urging customers to take advantage of the company's deferred payment program.
It is further important to note that this survey, made in late February and early March, reflects only information available to the companies at that time. This means that most companies provided the subcommittee staff with accounts receivable information through the month of December. As a result the figures represent a period which preceded the most severe impact of the cold this winter, which occurred in late December and throughout January. Several company representatives predicted accounts receivable for many utility companies included in the survey would increase dramatically when figures become available for the months of January and February.
DISCONNECTS THIS WINTER
As the second part of this survey of utility companies, the staff sought to determine the number of customers disconnected from service this winter for failure to pay as compared to the number of customers disconnected last winter. The staff found that in 15 States the number of customers disconnected this winter had decreased compared to last winter. In these States, disconnects have decreased almost 37% from last year.
In some of the States, Alabama for example, with a decrease of 3%, the reduction this winter over last has been slight. But in others like Pennsylvania where disconnects have dropped almost 60% this winter, the reductions have been dramatic
In four of these States, Alabama, Illinois, Oklahoma and Pennsylvania — this reduction is attributed to State utility commission regulations prohibiting cutoffs for at least part of the winter. Two other States — Oregon and Washington — report fewer cutoffs this winter because the weather this winter has been warmer than it was last winter.
The staff found that in 11 States disconnects for failure to pay have increased this winter over last. Disconnects have increased an average of 22.6% in these States.
At the low end, North Carolina reports an increase in disconnects of 11%. But in Montana, the utility company reported an increase of 48.5% (the utility company in Florida supplied the State commission with no hard data).
Important to note, however, is that in two of these States, California and Montana, the weather has been relatively warmer this winter than last. And the New York utility reported that its disconnects had increased this winter primarily because of a new liberalized payment program. Under that plan, customers are allowed to pay small amounts on outstanding bills, but are immediately cut off if they pay nothing. The result of this new program has been an increase in the number of disconnects. Further, in at least one State, Vermont, while the percentage increase in disconnects is significant at 38%, this percentage represents only 23 more actual disconnects this winter than last.
Twelve States reported that the number of their disconnects is about the same this winter as last.
This information from utility commissions, though mixed, indicated that in several States, utility companies have reduced the number of those disconnected for failure to pay. However, in recent days, the staff has found increasing information that this trend may not continue and that, in fact, utility companies may soon increase the number of cutoffs of those so far unable to pay their fuel bills this winter.
Most recently the staff has gathered the following:
The Wisconsin Gas Company of Milwaukee has sent out 25,000 disconnect notices effective April 2, the day after the State's moratorium on cutoffs expires. According to company officials, this 25,000 is only part of the 58,000 customers in the Milwaukee area behind in their payments, representing over $7 million in outstanding bills.
The Washington Gas Light Company in Washington, D.C. told the subcommittee that through the winter no customers had been cutoff for failure to pay. But, that for the month of February, 40,000 customers were eligible for cutoff (compared to 35,000 in February 1976) and that while the company had not decided when to begin to cut these customers off, according to a company spokesman, it is simply a matter of time;
A Columbus Gas Company representative in Ohio told the subcommittee that beginning April 1, the company would resume disconnecting those unable to pay. While no specific figures were available from the company, the spokesman said disconnects would be increased over last year;
On April 1, the Valley Gas Company of Rhode Island will begin disconnecting customers who have not paid so far this winter. According to a company spokesman, the number of cutoffs will probably be triple the number of cutoffs last year.
A representative of the Pennslyvania Utility Commission told the subcommittee that while the cutoff moratorium is still in effect in the State, as soon as it is lifted, cutoffs will begin and many thousands of customers are likely to be affected.
This information was collected March 18,1977, and does not appear in the charts appended to the study.