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Friday, April 1, 2011

The Low Income Home Energy Assistance Program (LIHEAP): Program and Funding

Libby Perl
Specialist in Housing Policy

The Low Income Home Energy Assistance program (LIHEAP), established in 1981 as part of the Omnibus Budget Reconciliation Act (P.L. 97-35), is a block grant program under which the federal government makes annual grants to states, tribes, and territories to operate home energy assistance programs for low-income households. The LIHEAP statute authorizes two types of funds: regular funds (sometimes referred to as formula funds), which are allocated to all states using a statutory formula, and emergency contingency funds, which are allocated to one or more states at the discretion of the Administration in cases of emergency as defined by the LIHEAP statute.

States may use LIHEAP funds to help households pay for heating and cooling costs, for crisis assistance, weatherization assistance, and services (such as counseling) to reduce the need for energy assistance. According to the most recent data available from the Department of Health and Human Services (HHS), in FY2007, 52.8% of funds went to pay for heating assistance, 3.4% was used for cooling aid, 17.9% of funds went to crisis assistance, and 10.1% was used for weatherization. The LIHEAP statute establishes federal eligibility for households with incomes at or below 150% of poverty or 60% of state median income, whichever is higher, although states may set lower limits. However, in both the FY2009 and FY2010 appropriations acts, Congress gave states the authority to raise their LIHEAP eligibility standards to 75% of state median income. In FY2008, the most recent year for which HHS data are available, an estimated 33.5 million households were eligible for LIHEAP under the federal statutory guidelines. According to HHS, 5.4 million households received heating or winter crisis assistance and approximately 600,000 households received cooling assistance that same year.

As of the date of this report, LIHEAP is funded through April 8, 2011, as part of a sixth continuing resolution (CR) for FY2011 (P.L. 112-6), which was signed by the President on March 18, 2011, and amends the Continuing Appropriations Act enacted on September 30, 2010 (P.L. 111-242). Pursuant to an earlier CR, the Continuing Appropriations and Surface Transportation Extensions Act (P.L. 111-322), the provisions of which amended the first CR and remain in effect, HHS is required to obligate to states, tribes, and territories the same amounts of LIHEAP regular funds that were obligated during the time period covered by the CR (through April 8) in FY2010. States request their share of LIHEAP formula grants quarterly, and may request as much as 100% of their grants in the first quarter of the fiscal year. State allocations under the CR are therefore based on how each state elected to receive their funds during the time period covered by the CR in FY2010, when the total amount appropriated for regular funds was $4.5 billion. For example, if a state requested all of their LIHEAP funding during the first two quarters of FY2010, then they would receive all of their FY2011 formula grant funding under the provisions of the CR.

On January 13, 2011, HHS issued a press release announcing how formula funds would be distributed through that date, and on January 24, 2011, it announced the distribution of $200 million in emergency contingency funds to all states, tribes, and territories. See columns (a) and (b) of Table A-1 for these distributions.

This report describes LIHEAP funding, program rules, and eligibility.

Date of Report: March 23, 2011
Number of Pages: 33
Order Number: RL31865
Price: $29.95

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