coordination of liheap with state and utility payment assistance programs neuac conference june 28,...
TRANSCRIPT
Coordination of LIHEAP with State and Utility Payment
Assistance Programs
NEUAC Conference
June 28, 2011
Jackie Berger
Overview
• Introduction
• Coordination Advantages and Disadvantages
• Coordination Models
• HHS Guidance
• Summary and Recommendations
2
COORDINATION ADVANTAGES AND DISADVANTAGES
3
Program CoordinationGeneral Advantages
• Efficiency
• Equity
• Simplicity
• Integrity
4
Program CoordinationEfficiency
• Efficiency: use existing infrastructure– Single application.– One set of intake agencies.– Joint eligibility determination.– Single database.– Reduced administrative burden.
5
Program CoordinationEquity
• Equity: account for different benefit receipt– Total benefit or burden does not vary by
combination of benefits received.– Ensure that those with greatest need receive
greatest benefit.
6
Program CoordinationSimplicity
• Simplicity: one set of standards and procedures– Reduced staff training needs.– Lower probability of errors in eligibility and
benefit determination.– Increased likelihood of client understanding.– Reduced client burden.
7
Program CoordinationIntegrity
• Integrity: use of fiscal assurances– LIHEAP office procedures and accountability systems.– May include systematic checks:
• Validation of applicant and household member information with SSA.
• Income database match (State Directory of New Hires).
• SSA death master file match or state vital statistics database match.
• Match with list of incarcerated individuals in state prisons.
8
Program CoordinationGeneral Disadvantages
• Different goals– Focus on home heating and cooling.– Focus on electric usage.
• State data access– Energy usage data.– Payment compliance data.
9
COORDINATION MODELS
10
Models
11
Linkage
• Payment Assistance Programs Linkage– Two-way referrals
• LIHEAP agencies refer to utility payment program.
• Utility representatives refer to LIHEAP.
– Targeted referrals• Utilities focus LIHEAP referrals to greatest need.
• Local agency staff refer payment-troubled to utility program.
– Enrollment• Utility staff assist with LIHEAP applications.
• LIHEAP agencies enroll applicants in utility programs.
12
Linkage
• Possible utility LIHEAP policy– Penalty for not applying for LIHEAP.
– LIHEAP requirement for program participation.• Advantage: encourage application
• Disadvantage: barriers for some customers
13
Presumptive Eligibility/Automatic Enrollment
• Presumptive eligibility: documentation not required if LIHEAP recipient.
• Automatic enrollment: data transfer to automatically enroll households.
• Advantages– Reduced client burden.
– Reduced administrative costs.
• Disadvantages– Need to follow same program guidelines.
– Loss of detailed information for evaluation (if utility does not obtain eligibility information).
14
Joint Benefit Calculation• Benefits for LIHEAP and ratepayer program are
determined to reach a certain total benefit or target burden.
• Advantages:– Customers who receive LIHEAP do not have higher total
benefit. – Customers who fail to apply for LIHEAP do not have lower
total benefit.
• Disadvantages:– Lack of incentive to apply for LIHEAP.
15
Joint Benefit CalculationNJ Example
Program Parameters
• LIHEAP/Utilities/BPU – Program administered by LIHEAP office.
– LIHEAP/USF application has income and heating fuel.
– LIHEAP office pays LIHEAP grant to utilities (annual credit).
– Utilities furnish information on annual energy bill.
– LIHEAP office computes USF benefit and informs utilities.
– Utilities furnish USF benefit (monthly credit).
– Utilities are reimbursed for USF from SBC fund.
16
Joint Benefit CalculationNJ Example
Benefit Calculation
• Total Benefit = Customer Bill – 3% of Income– Income = $25,000; 3% = $750– Gas Bill = $2,050; Electric Bill=$1,350– Total Gas Benefit = $2,050 - $750 = $1,300– Total Electric Benefit = $1,350 - $750 = $600
• USF Benefit = Total Benefit – LIHEAP– LIHEAP Benefit = $400– USF Benefit = $1,300 + $600 - $400 = $1500– Monthly USF Benefit-$1500/12=$125
17
Joint Benefit CalculationNJ Example
Benefit Payment• LIHEAP – Annual Credit• USF – Fixed Monthly Credit• Example:
– January LIHEAP benefit
– LIHEAP Benefit = $400
– USF Benefit = $125/month
– Benefit payment stream• Jan = $525, Feb = $125, Mar = $125, …, Dec = $125
18
Joint Benefit CalculationNJ Example
19
Gross Electric Bill
USF CreditGross Gas
BillUSF Credit LIHEAP Net Bill
January $125 $50 $325 $75 $400 ($75)
February $140 $50 $315 $75 $330
March $100 $50 $275 $75 $250
April $60 $50 $145 $75 $80
May $60 $50 $85 $75 $20
June $125 $50 $75 $75 $75
July $150 $50 $65 $75 $90
August $175 $50 $70 $75 $120
September $110 $50 $75 $75 $60
October $80 $50 $125 $75 $80
November $80 $50 $225 $75 $180
December $145 $50 $270 $75 $290
Joint Benefit Distribution• Benefits for LIHEAP and ratepayer program are
determined separately.• LIHEAP benefits used to offset cost of utility payment
program.• Advantages:
– Reduced ratepayer cost.– Equitable total benefit.– Constant monthly payment (possible).
• Disadvantages:– Lack of financial incentive to apply for LIHEAP.
20
Joint Benefit Distribution
Poverty Level Natural Gas Heating Electric Heating Electric Non-heating
<=50% 5%-8% 7%-13% 2%-5%
51% - 100% 7%-10% 11%-16% 4%-6%
100% - 150% 9%-10% 15%-17% 6%-7%
21
Pennsylvania Public Utility CommissionEnergy Burden Targets
Joint Benefit Distribution
22
Percent of Income (PIPP) Illustration
Poverty Level
Customer Payment
Example
Annual Income
Payment Calculation
Monthly Payment
Minimum $25 $0 Minimum $25
0% - 50% 8% $10,000 .08*$10,000/12 $67
51% - 100% 9% $15,000 .09*$15,000/12 $113
101% - 150% 10% $25,000 .10*$25,000/12 $208
Joint Benefit Distribution
23
Gross Utility Bill
PIPP Payment
Subsidy
January $325 $113 $212
February $315 $113 $202
March $275 $113 $162
April $145 $113 $32
May $85 $113 ($28)
June $75 $113 ($38)
July $65 $113 ($48)
August $70 $113 ($43)
September $75 $113 ($38)
October $125 $113 $12
November $225 $113 $112
December $270 $113 $157
No LIHEAP Grant
Gross Bill $2,050
Net Bill $1,356
Total Subsidy $694
Joint Benefit Distribution
24
Gross Electric
Bill
PIPP Payment
LIHEAPNet
Payment
January $325 $113 $400.00 $0
February $315 $113 $0
March $275 $113 $0
April $145 $113 $61
May $85 $113 $113
June $75 $113 $113
July $65 $113 $113
August $70 $113 $113
September $75 $113 $113
October $125 $113 $113
November $225 $113 $113
December $270 $113 $113
LIHEAP Grant Applied to Bill
Targeted Burden 9%
Gross Bill $2,050
Net Utility Bill $1,356
Total Utility Subsidy $694
LIHEAP Grant $400
Net Customer Bill $956
Net Customer Burden 6%
Joint Benefit Distribution
25
Gross Electric
Bill
PIPP Payment
LIHEAP SubsidyNet
Subsidy
January $325 $113.00 $400.00 $212 $0
February $315 $113.00 $202 $14
March $275 $113.00 $162 $162
April $145 $113.00 $32 $32
May $85 $113.00 ($28) ($28)
June $75 $113.00 ($38) ($38)
July $65 $113.00 ($48) ($48)
August $70 $113.00 ($43) ($43)
September $75 $113.00 ($38) ($38)
October $125 $113.00 $12 $12
November $225 $113.00 $112 $112
December $270 $113.00 $157 $157
LIHEAP Grant Applied to Subsidy
Targeted Burden 9%
Gross Bill $2,050
Net Utility Bill $1,356
Total Utility Subsidy $694
LIHEAP Grant $400
Net Utility Subsidy $294
Net Customer Burden 9%
Joint Benefit Distribution
26
PA Low-Income Bill Payment Assistance Programs Program Participant Survey Research
“What do you feel are the benefits of the program?”Utility 1 Utility 2 Utility 3 Utility 4
Lower energy bills 48% 33% 30% 50%
Even payments 29% 22% 41% 14%
Maintaining service 9% 20% 16% 11%
Reduced arrearages 14% 15% 16% 7%
Don’t know 9% 2% 9% 10%Source: APPRISE surveys with low-income bill payment assistance program participants in PA utility programs.
Funds Transfer
• Ratepayer funds combined with LIHEAP funds.
• Total funding used to determine one benefit.
• Advantages– Equitable total benefit.– One program to administer.– One program for client to understand and apply for.
• Disadvantages– Potential loss of utility specific information.– Loss of fuel/use specific benefit targeting.
27
HHS GUIDANCE JULY 2010 INFORMATION MEMORANDUM
28
Memo Purpose
• Concern that LIHEAP funds used in PIPPs or other vendor assistance programs are not administered in accordance with LIHEAP statutory or regulatory requirements.
• Clarify ways that LIHEAP funds may be coordinated with vendor energy assistance programs, and continue to be governed by the LIHEAP statute and regulations.
29
Coordination Requirements
• The State must ensure that LIHEAP funds continue to be governed by the LIHEAP statute, regulations and State plan.
• The coordination must be described in the State’s LIHEAP plan.
• The LIHEAP client should be informed of how his LIHEAP benefit will be applied to his bill under the PIPP program.
30
Coordination Requirements
• Must be described in State Plan:– If LIHEAP is applied to the client’s bill
incrementally, over a period of time, and represented to the client as the “PIPP” discount.
– When LIHEAP funds are applied to a LIHEAP client’s utility arrearage amount under the PIPP program.
31
Coordination Requirements
• The utility does not have independent authority to use LIHEAP for any other customer or purpose.
• Subtracting LIHEAP from the client’s energy bill to calculate the PIPP discount appears to be using LIHEAP as a resource and creates an inequity or adverse treatment for PIPP participants. HHS will question the practice and ask for a grantee’s legal opinion supporting this practice and its compliance with the LIHEAP statute.
32
SUMMARY AND RECOMMENDATIONS
33
Summary
• Coordination has implications for:– Equity– Monthly bill variation– LIHEAP application incentive– Administrative process– Information availability
• All issues should be considered when determining whether and how to coordinate.
34
Contact Information
Jackie Berger, Ph.D.President and Co-Founder
APPRISE32 Nassau Street, Suite 200
Princeton, NJ 08542609-252-8009
35