Gov. Blagojevich Calls on Utilities to Halt Administrative Reconnection Fees and Deposits for LIHEAP customers as Natural Gas Prices Expected to Skyrocket this Winter

CHICAGO - In preparation for skyrocketing energy prices during the upcoming winter months, Governor Rod R. Blagojevich today called on the Illinois utility companies to help maximize the effectiveness of the Low Income Heating Energy Assistance Program (LIHEAP) by waiving administrative re-connection fees and security deposits for LIHEAP customers. 

 

"We will all feel the impact of Hurricane Katrina this winter when we open our heating bills, but our elderly and families living on fixed income will surely be hit the hardest," said Gov. Blagojevich.  "That's why our LIHEAP program will be more important than ever this winter.  We helped 311,000 households last year, and our goal is to maximize the benefits of LIHEAP funds so we can meet the need again this year.  I'm asking Illinois utility companies to play a role by waiving administrative fees for LIHEAP customers so that every dollar of every grant is going to pay actual heating costs." 

 

In a letter sent to the utility companies today, Governor Blagojevich stated that the U.S. Energy Information Administration reported in its "Short-Term Energy Outlook" that the projected increase in home heating expenditures this winter will be "69 percent to 77 percent for natural gas in the Midwest."  The high heating expenses will affect millions and will hit hundreds of thousands of low-income families in Illinois especially hard.

 

In the past, LIHEAP funds have been used first to cover utilities' administrative re-connection fees and security deposits, which can cost more than $400.  The Governor is asking utilities to waive such fees so that grant funds go directly to cover actual usage charges, allowing the state to help more households cover heating costs.  

 

"Due the extraordinary increase in energy costs this winter, and our need to make LIHEAP resources stretch as far as possible, I request that your company waive re-connection charges and security deposits for families receiving LIHEAP.  Working together, we can ensure that our most vulnerable citizens will stay safe and warm this winter," the Governor wrote to utility CEOs.

 

Through LIHEAP, a state- and federally-funded energy assistance program run by the Illinois Department of Healthcare and Family Services (HFS), heating bill payments are made available to households with incomes of up to 150 percent of the federal poverty level.  Governor Blagojevich made LIHEAP funding available on September 1, 2005 to vulnerable households and those currently without home heating due to service disconnections to meet their winter heating needs.  

 

"The Governor is doing everything he can to make sure families stay out of the cold this winter and now is the time for utilities to step up to the plate and put an end to these needless reconnection fees," said Barry Maram, Director of the Illinois Department of Healthcare and Family Services.  "In the wake of Hurricane Katrina, high energy prices are going to affect each and every one of us this winter and we must be prepared as a state to do all we can to help the most vulnerable and struggling households."

 

On September 1, 2005, the Governor sent a letter to the Illinois Congressional Delegation urging them to protect critical LIHEAP funding during upcoming budget negotiations.  The U.S. House Appropriations Committee has only approved $2.006 billion in regular funds and no emergency contingency funding for the fiscal year 2006 LIHEAP program.  The Senate Labor-HHS-Education Appropriations Committee has proposed program funding at $1.883 billion for the regular program and $300 million for the emergency contingency fund.  This is less than the $2.18 billion in funding approved for last year's program, which also included an additional $297 million in emergency funds. This budget shortfall, if approved by Congress, could have a disastrous impact on vulnerable households including seniors, young families and those with health problems worsened by cold weather.

 

Through LIHEAP, a single-person household can qualify with a monthly income of up to $1,196, a two-person household up to $1,604, and a family of four can earn up to $2,420.  Benefits are paid directly to the household's appropriate utility.  The energy grant applications are processed through a network of 35 Local Administering Agencies around the state.  These agencies accept applications on a first-come, first-serve basis from vulnerable households beginning September 1 and all income-eligible households on November 1, 2006.  The winter heating program is expected to reach 300,000 households this winter with an estimated $150 million in state and federal funding.