SUBJECT:

PURPOSE:

Albany, New York
Tuesday, February 14, 2006
10:00 AM
New York State Museum
Cultural Education Center
Museum Theatre
Madison Avenue
Albany, New York

On February 1, 2006, the Assembly Standing Committees on Energy, Social Services, and Aging convened a hearing that elicited testimony from all pertinent stakeholders in regard to the disbursement of $100 million in additional State funding recently appropriated by the Legislature for the HEAP program. Witnesses representing local social services districts, advocates for low-income households, and experts on energy assistance programs testified to the overwhelming increase in HEAP applications attributable to the dramatic rise in fuel costs this winter. They also provided evidence that local governments and non-profit charitable organizations are in desperate need of additional funding to meet this increased need.

While the majority of witnesses emphasized the importance of distributing the $100 million as quickly as possible to local districts, the Office of Temporary and Disability Assistance (OTDA), the lead agency responsible for administering HEAP, did not provide clear assurance that all funds would be released in a timely manner or that the agency was committed to full expenditure of those funds. Therefore, the Committees seek to obtain further clarification from OTDA to provide a more complete explanation regarding the means through which the State will distribute the additional $100 million appropriation and the changes that will be made to the administration of HEAP at the State and local levels.

Under the Governor's appropriation language, which Constitutional limitations prevent the Legislature from modifying, eligibility is cut off on April 15th, more than a full month earlier than last year's program. It is unclear from OTDA's February 1 testimony whether the State would be willing to agree to amend this cut off date to allow households in need of energy assistance additional time to submit an application for HEAP benefits. In addition, there is a concern that some families who may be eligible for either a regular, emergency or second emergency HEAP benefit may not know of the availability of HEAP grants or the process involved in applying.

According to some of the testimony that was presented on February 1, low-income households in the Northeast pay on average between 10-29% of their total income to cover home energy costs, while those with incomes at or above the State's median income pay only 3-4% on average for household energy. In addition, estimates for winter 2005-06 prices relative to winter 2004-05 from the U.S. Department of Energy predict a 27.7% increase in the price of natural gas, a 25.7% increase in heating oil prices, and a 13% increase in the price of propane. Furthermore, as previously stated in the initial hearing notice, home heating oil prices in New York State are up 21 percent from last year's prices and 60 percent from two years ago. While natural gas prices have also risen in a similar fashion, HEAP grant awards have remained flat. At the same time, HEAP applications in New York State have increased dramatically. The number of regular benefits granted to homeowners or renters who filed applications has risen to 183,148 this year, from 76,632 during the same period last year.

There remains a serious concern that the current structure of the HEAP program is not adequate to meet the significant increase in demand for energy assistance this winter. The Executive's $50 million deficiency appropriation language which also binds the Legislature's $50 million addition for HEAP, would allow for increased base grant amounts and more than a single emergency grant per household. However, it appears based on the testimony submitted by OTDA on February 1, that the State will not exercise its power to increase base grant amounts, despite the crisis situation facing thousands of New York families and the urgent need to raise the base grant amount to provide real energy relief to families.

This hearing will provide an opportunity for OTDA to respond to the escalating demand for energy assistance amongst New York's low-income population. In order for the HEAP program to be an effective source of assistance to vulnerable families, it is essential that the $100 million appropriation in additional State funds be distributed promptly and expended in full during the 2005-06 winter season.

Below is a list of subjects to which invited witnesses may direct their testimony. Those invited to present pertinent testimony to the Committee at the above hearing should complete and return the reply form as soon as possible. It is important that the reply form be fully completed and returned so that persons may be notified in the event of emergency postponement or cancellation.

Oral testimony will be limited to 10 minutes' duration. Ten copies of any prepared testimony should be submitted at the hearing registration desk. The Committee would appreciate advance receipt of prepared statements.

In order to meet the needs of those who may have a disability, the Assembly, in accordance with its policy of non-discrimination on the basis of disability, as well as the 1990 Americans with Disabilities Act (ADA), has made its facilities and services available to all individuals with disabilities. For individuals with disabilities, accommodations will be provided, upon reasonable request, to afford such individuals access and admission to Assembly facilities and activities.

SELECTED ISSUES TO WHICH WITNESSES MAY DIRECT THEIR TESTIMONY:

1. How will OTDA ensure that the full $100 million appropriation in State funds for HEAP will be distributed to local districts and expended within the 2005-06 winter season?

2. Would OTDA be willing to agree to an amendment to extend the cut off date for HEAP past the current April 15, 2006 deadline? What closing date would ensure that needy seniors and families receive the support required to avert energy crisis?

3. Why is OTDA planning to limit the expansion of HEAP only to provide an additional emergency benefit to households that qualify? Could this be a problem for households in need of additional energy assistance due to the narrow eligibility criteria for obtaining even an initial emergency HEAP grant, and beyond that, an additional emergency HEAP grant? How will OTDA inform eligible households of the opportunity to apply for an additional emergency HEAP grant?

4. Would OTDA consider increasing the base grant amount for regular HEAP benefits? If not, please provide a valid explanation given the exorbitant rise in the cost of energy this winter.

PUBLIC HEARING REPLY FORM

Those invited to present testimony at the public hearing on The Implementation and Effectiveness of New York's Low-Income Home Energy Assistance Program (HEAP) are requested to complete this reply form as soon as possible and mail it to:

Jill Poklemba
Legislative Analyst
Assembly Committee on Social Services
Room 520 - Capitol
Albany, New York 12248
Email: poklemJ@assembly.state.ny.us
Phone: (518) 455-4371
Fax: (518) 455-4693

I will address my remarks to the following subjects:

I will require assistance and/or handicapped accessibility information. Please specify the type of assistance required: