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62–130 2010

THE FUTURE OF LIHEAP FUNDING: WILL FAMILIES 

GET THE COLD SHOULDER THIS WINTER? 

HEARING 

BEFORE THE

SELECT COMMITTEE ON 

ENERGY INDEPENDENCE 

AND GLOBAL WARMING 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED TENTH CONGRESS 

SECOND SESSION 

SEPTEMBER 25, 2008 

Serial No. 110–50 

( 

Printed for the use of the Select Committee on 

Energy Independence and Global Warming 

globalwarming.house.gov 


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SELECT COMMITTEE ON ENERGY INDEPENDENCE 

AND GLOBAL WARMING 

EDWARD J. MARKEY, Massachusetts, Chairman 

EARL BLUMENAUER, Oregon 

JAY INSLEE, Washington 

JOHN B. LARSON, Connecticut 

HILDA L. SOLIS, California 

STEPHANIE HERSETH SANDLIN, 

South Dakota 

EMANUEL CLEAVER, Missouri 

JOHN J. HALL, New York 

JERRY MCNERNEY, California 

F. JAMES SENSENBRENNER, JR., 

Wisconsin, Ranking Member 

JOHN B. SHADEGG, Arizona 

GREG WALDEN, Oregon 

CANDICE S. MILLER, Michigan 

JOHN SULLIVAN, Oklahoma 

MARSHA BLACKBURN, Tennessee 

PROFESSIONAL STAFF

GERARD J. WALDRON Staff Director 

ALIYA BRODSKY, Chief Clerk 

THOMAS WEIMER, Minority Staff Director 


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C O N T E N T S 

Page 

Hon. Edward J. Markey, a Representative in Congress from the Commonwealth of Massachusetts, opening statement .................................................... 1 

Prepared statement .......................................................................................... 3 

Hon. F. James Sensenbrenner, Jr. a Representative in Congress from the 

State of Wisconsin, prepared statement ............................................................. 6 

Hon. Emanuel Cleaver II, a Representative in Congress from the State of 

Missouri, prepared statement ............................................................................. 8 

WITNESSES

Hon. Deval Patrick, Governor, Commonwealth of Massachusetts ...................... 9 

Prepared statement .......................................................................................... 12 

Answers to submitted questions ...................................................................... 69 

Mark Wolfe, Executive Director, National Energy Assistance Directors’ Association .................................................................................................................... 28 

Prepared statement .......................................................................................... 33 

John Drew, Executive Vice President, Action for Boston Community Development, Inc. .............................................................................................................. 39 

Prepared statement .......................................................................................... 42 

Howard Gruenspecht, Acting Administrator, Energy Information Administration ........................................................................................................................ 50

Prepared statement .......................................................................................... 52 

Answers to submitted questions ...................................................................... 72 

SUBMITTED MATERIALS

Hon. John Shadegg, a Representative in Congress from the state of Arizona, 

a letter from Governor of Arizona, Janet Napolitano, to the honorable 

Michael O. Leavitt, Secretary of Health and Human Services ........................ 22 


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THE FUTURE OF LIHEAP FUNDING: WILL 

FAMILIES GET THE COLD SHOULDER THIS 

WINTER? 

THURSDAY, SEPTEMBER 25, 2008 

HOUSE OF REPRESENTATIVES, 

SELECT COMMITTEE ON ENERGY INDEPENDENCE

AND GLOBAL WARMING, 

Washington, DC. 

The committee met, pursuant to call, at 2:04 p.m., in room 1324, 

Longworth House Office Building, Hon. Edward J. Markey (chairman of the committee) presiding. 

Present: Representatives Markey, Inslee, Solis, Herseth Sandlin, 

Cleaver, Hall, Sensenbrenner, and Shadegg. 

Staff Present: Morgan Gray. 

The CHAIRMAN. This hearing is called to order of the Select Committee on Energy Independence and Global Warming. 

While the debate in Congress over high gas prices has been redhot this summer, families in the Northeast and Midwest have also 

been thinking about how they will cope with the cold weather this 

winter. The prices of home heating fuels have been skyrocketing 

and millions of families will face tough choices during the upcoming months between the purchasing of fuel or purchasing of food. 

The Department of Energy’s projections for home heating prices 

this winter are grim. DOE forecasts that families in the Northeast 

who use heating oil will spend 30 percent more this winter than 

last year, an increase of more than $600. Families using natural 

gas will spend nearly 20 percent more this year. And regardless of 

the region of the country or the home heating fuel, the Department 

of Energy is forecasting that families will experience a substantial 

increase in their heating costs this winter. 

We will be hearing from the Department of Energy later on this 

afternoon. 

American consumers, who have already been getting tipped upside down when they pull up to the gas pump, will now also face 

high energy prices when they return home. Incredibly, this year 

many low-income families will spend even more to heat their 

homes than they have already spent on record gasoline prices. Lowincome families on average spend roughly 15 percent of their income on home energy bills. 

For nearly 30 years, the LIHEAP program, the Low Income 

Home Energy Assistance Program, has helped low-income families 

pay their home energy bills. This program has been a vital safety 

net for millions of Americans. 


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However, under the Bush administration, this program has been 

woefully underfunded. In his budget request this year, President 

Bush proposed cutting total LIHEAP funding by 22 percent, reducing it from $2.57 billion to $2 billion. Indeed, in recent years, 

LIHEAP has generally been funded at less than half of its authorized level of $5.1 billion. As a result, last year LIHEAP was only 

able to provide assistance to about 15 percent of eligible families 

nationwide. 

At a time of record oil prices, the President can’t continue to 

freeze funding for this important heating assistance program. Earlier this week, nearly 100 Members signed a letter requesting that 

LIHEAP receive full funding in any continuing resolution that 

passes the Congress. And yesterday, under the leadership of Speaker Pelosi, the House passed a continuing resolution that would 

massively increase LIHEAP funding, providing a total of $5.1 billion for the program. That is full funding at the authorized level. 

This additional funding could not come at a more important time 

to ensure that families will not be left out in the cold this winter. 

Indeed, the increase in LIHEAP funding over last year’s level that 

is included in the CR would be greater than the total funding level 

for the program in 25 out of the 27 years that the program has existed. 

The House-passed continuing resolution would also expand the 

number of people eligible for LIHEAP assistance, in order to help 

additional families already struggling under the increased costs of 

everything from gas to groceries. 

Governor Patrick, who is our first witness, has given outstanding 

leadership to this program. 

[Prepared statement of Chairman Markey follows:] 


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Many members of this committee are also on the Financial Services Committee and other committees with jurisdiction over this financial bailout that we are going to be deliberating upon later on 

today and tomorrow. And so that is just an unfortunate set of circumstances that have developed—that, as the afternoon goes by, I 

think we will be visited by those members as well. 

[The prepared statements of Mr. Sensenbrenner and Mr. Cleaver 

follow:] 


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But I don’t think it should interfere with hearing from Governor 

Patrick at this time, so that he can be recognized to make his 

statement to the committee. 

We welcome you, sir. We thank you for your great leadership on 

this issue. Whenever you are ready, please begin. 

STATEMENT OF HON. DEVAL PATRICK, GOVERNOR, 

COMMONWEALTH OF MASSACHUSETTS 

Governor PATRICK. Mr. Chairman, thank you. And thanks to you 

and the members of the committee for the opportunity to appear 

today and testify. 

I know, as you mentioned, that the turmoil in the financial markets is dominating your own and the general public’s attention 

today, as well it should. It is certainly on my mind and, I am sure, 

on the mind of every other Governor in the country. Especially 

under those circumstances, I thank you for turning some of your 

attention today to the subject of this hearing, a crisis in the making that has the potential to become a public health threat in Massachusetts, in New England, and in many other parts of the country. I am talking about the crisis of home heating costs that coldweather States expect this winter. Without help, many of our most 

vulnerable citizens will find themselves facing heating bills they 

cannot pay. 

And the challenge is right around the corner. Nighttime temperatures are already dropping into the 40s and 30s this week in New 

England. Unless we prepare, including by fully funding the 

LIHEAP fuel assistance program, my State and others will face 

what some call a slow-motion Katrina. 

Let me try to dimensionalize the challenge for you. Home heating 

oil is used by nearly 40 percent or 963,000 Massachusetts households. According to our Department of Energy Resources’ regular 

statewide survey of prices, the average price of home heating oil in 

Massachusetts hit a record high of $4.71 a gallon after steadily rising week after week for over a year. 

Now, even after the recent moderating of those prices, prices of 

heating fuels have settled in at roughly $4 a gallon, which is 50 

percent higher than just last year, when the average price was 

$2.70 a gallon. Should the price remain at $4 a gallon through the 

coming heating season, it will take more than $3,200 to heat an average Massachusetts household with oil this winter, up from $1,800 

just two winters ago. Many consider that estimated average to be 

conservative. If a family uses the more commonplace 1,100 gallons 

next winter, which is not unusual as I say, it will cost them over 

$4,000 to heat their home. Again, that compares to $1,800 just two 

winters ago. 

The Massachusetts LIHEAP program is expected to serve almost 

144,000 households this winter. With rising energy costs and level 

funding, our benefits would barely cover half the roughly $1,130 it 

costs to fill a tank of heating oil. At that rate, the benefit would 

run out by the end of this calendar year. 

So I want to thank the House for substantially increasing the 

Federal Funding for the LIHEAP program through the continuing 

resolution passed last night, and for doing so on a broad bipartisan 

basis. 


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The prospect of significantly higher home heating cost this coming winter was sufficiently alarming to me and to my colleagues in 

the legislature that we formed a Winter Energy Costs Task Force. 

In five public hearings across the State, the task force heard compelling testimony about the impact that high heating costs would 

have our most vulnerable citizens, including low-income families 

with children, people with disabilities, and seniors as well. 

I just want to give you a couple of the stories that we learned 

with. One about a senior citizen from Gloucester, not unusual, who 

was living on $790 a month to pay for his housing and medical expenses, and who, beyond that, could not afford the oil needed to 

heat his home. Without an increase in funding for fuel assistance, 

he would be eligible for only so much as to buy two-thirds of one 

tank, which might not even get him to January. He is considering 

a reverse mortgage in order to get by this winter. 

Another example, a director of a community action program in 

Lynn told the story of a woman with three school-aged kids who 

just lost her job. She is collecting $157 each week in unemployment. She doesn’t even have enough to cover her rent of $800 a 

month. Without additional LIHEAP funding, fuel assistance won’t 

be enough to fill her oil tank even once. 

This CAP director who told us that story said that, in 29 years 

of his own service, he has never seen so many folks asking for fuel 

assistance for the first time. 

Now, I do want you to know that Massachusetts is doing everything we can to avoid disaster this winter. Our Department of Public Utilities has recently ordered an increase in the discount given 

to low-income customers on their electric and natural gas bills, 

which will save them between $75 and $300 over the coming winter. We have also expanded programs to help low-income customers 

pay past-due bills. We have appropriated $10 million in State funds in unusually 

tight fiscal times to supplement Federal fuel assistance funding 

this winter as well. And we are working to expand energy-efficiency services provided by utilities this fall to help their customers 

tighten and insulate their homes as well as upgrade their heating 

systems with the help of rebates and low-interest loans. 

These latter measures, by the way, are consistent with the accelerated implementation of what we call the Green Communities Act, 

a comprehensive energy reform legislation, which I know you know 

about, Mr. Chairman, that I signed into law earlier this year. 

In addition, we are going to use the proceeds of the very first 

auction of greenhouse gas emission allowances under the Regional 

Greenhouse Gas Initiative, which took place this morning, to support energy-efficiency efforts. The specific targets of those investments will depend on the recommendations of that Winter Energy 

Costs Task Force I mentioned a moment ago. We will have their 

report shortly on measures we can take to help our fellow citizens 

stay warm and safe this winter. 

But the fact is that we still need you. I very much understand 

and respect the demand for resources that compete for your attention; I really do. Nevertheless, what is at stake is the real possibility that many citizens in the colder regions of this country will 

be at risk of freezing to death without Federal help. 


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So I thank you again for the House action yesterday. And I urgently ask the full Congress to fully fund the Low Income Home 

Energy Assistance Program at the $5.1 billion level now under consideration as part of the continuing resolution. This funding would 

almost double this winter’s expected LIHEAP benefit in Massachusetts, providing enormous help to families across the Commonwealth and, indeed, to families in all of the affected regions. 

I lastly just want to acknowledge that, though essential, this 

funding is a stopgap measure. High energy costs in the Northeast 

are a foreseeable and continuing reality. A dedicated Federal plan 

that includes support for State LIHEAP programs and also for efficiency strategies and renewable energy generation and delivery is 

the big task remaining. And we look forward to working with you 

on that, as well. 

Thank you very much. 

[The statement of Governor Patrick follows:] 


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The CHAIRMAN. Thank you, Governor, very much. 

Let me now turn and recognize the gentleman from Arizona, Mr. 

Shadegg. 

Mr. SHADEGG. Governor, I want to thank you for your appearance here. This is an important topic, and I share many of the concerns you expressed. 

As I listened to you—I am not going to ask questions—but as I 

listened to you, I couldn’t help but think of T. Boone Pickens and 

his argument to us that natural gas is more plentiful in this country and that it is a cleaner fuel. 

I guess that leads me to wondering—and I listened to you describe the program you have to encourage people to put in more efficient fuel heating systems in their homes. Obviously, gaining as 

much savings as we can in energy in this country through efficiency gains, through better insulation, and through the cleaner 

fuels, for example, natural gas, are all a part of this problem. 

LIHEAP has played a key role. 

I am going to suggest or request that a letter from one of your 

colleagues, my Governor, Janet Napolitano, be inserted in the 

record. It is a letter she wrote in September to former Governor 

Mike Leavitt about the inequity. 

I do not know that heat kills as many Americans as cold or is 

as vast a problem, but it is a real problem. We do have people in 

Arizona who die as a result of not having heat in their homes, and 

that is as big a tragedy as somebody dying in your home State of 

the lack of heat. Arizona is, in some ways, blessed by having both 

problems. We have parts of Arizona which are, quite frankly, as 

cold as Massachusetts. So this program is important. 

I guess I would hope for the day when we need this program less 

because we have taken on American energy and brought down the 

price of energy by forging on into the future, as my colleague from 

Massachusetts has pushed us to do for so long. 

So I would request unanimous consent to put that letter in the 

record. 

The CHAIRMAN. Without objection, so ordered. 

[The information follows:] 


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Mr. SHADEGG. I commend you for your work and initiative in this 

area, and I appreciate your testimony. 

With that, I will yield back. 

The CHAIRMAN. Thank you. 

Any comment, Governor? 

Governor PATRICK. Well, I would just say, Congressman, first of 

all, on the point about natural gas, I couldn’t agree with you more. 

In terms of its impact on the environment, it is a lot cleaner than 

the burning of oil or coal for that matter. 

It is a challenge for us, because we are at the end of the pipeline. 

And so we have been working on strategies, some with Canada and 

some with other suppliers, on how safely to deliver liquefied natural gas into the pipeline that affects us in New England. We don’t 

have a solution for that, but we have been working on it. 

And I take your point also about the concerns that are different 

but no less significant in their impact on human beings of extreme 

heat just as extreme cold and not being able to necessarily deal 

with that or respond to it. 

I understand that the LIHEAP program will be up for reauthorization soon, and I suspect that, tough as those issues are, they will 

get worked out there. And we look forward to being part of that 

conversation. 

Mr. SHADEGG. Well, as hot as it is in Arizona and in parts of the 

area, it presents a very real challenge. And, fortunately, I think we 

are going to look at this program and find a little bit greater equity 

in it. But I appreciate your efforts. Thank you. 

Governor PATRICK. Thank you. 

The CHAIRMAN. The gentleman’s time has expired. 

Governor, do you work with other Governors in the region in putting together a strategy to deal with this issue? 

Governor PATRICK. Well, we have worked with Governors in the 

region on two fronts. First of all, we had all of the Governors in 

New England together to discuss common ways or just, really, to 

trade best practices around efficiencies and to help prepare for the 

coming winter. We did that in July. 

And it was following that that we wrote to the President and to 

the congressional leadership, asking for the full funding of LIHEAP 

and the Weatherization Program, precisely the action that you took 

in the continuing resolution. So, again, thank you for that. 

The outcome of the Winter Energy Costs Task Force that I mentioned earlier, the recommendations that will come from that from 

Massachusetts we will share with our colleagues around the region. 

And we have been taking some of their counsel, as well. 

And, finally, I would mention that, just 2 weeks ago, maybe last 

week—I am losing track of time—the New England Governors met 

with the eastern Canadian Premiers, which we do periodically, but 

particularly to talk about how we can begin to economically get renewable energy generated in Canada down into our region. 

The CHAIRMAN. That would really be a huge breakthrough if we 

could accomplish that goal. 

And you put together a joint task force this past summer in anticipation of the higher energy prices. 

Governor PATRICK. That is right. 


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The CHAIRMAN. Could you talk a little bit about that and the lessons that other States might learn from that? 

Governor PATRICK. Well, we will have those recommendations in 

the next week or so, Mr. Chairman. They are due at the end of this 

month to myself, the Speaker and the Senate President. They took 

testimony from around the Commonwealth so that we were getting 

practical and not theoretical insights. 

LIHEAP was a part of that discussion, but not the sole part by 

any means. A lot of interest in how we support efficiency initiatives, including weatherization, including changing out or updating 

inefficient heating systems, that sort of thing, and what resources 

there are for that. 

Some of this is paid for already by an added charge on utility 

bills. And I have used my own, sort of, bully pulpit to encourage 

residents to get those energy audits now before the weather gets 

too cold, so that they can begin to prepare. 

The CHAIRMAN. Thank you, Governor. 

The Chair recognizes the ranking member of the committee, the 

gentleman from Wisconsin, Mr. Sensenbrenner. 

Mr. SENSENBRENNER. Thank you very much, Mr. Chairman. 

First of all, I am sorry I am late, but I was getting my picture 

took with the Judiciary Committee, since I have my bright red tie 

on. That ended up being more important. Sorry, Governor. 

Governor PATRICK. No worries. 

Mr. SENSENBRENNER. Secondly, I have an opening statement 

that I would ask unanimous consent to be included in the record. 

The CHAIRMAN. Without objection, it will be included. 

Mr. SENSENBRENNER. Thirdly, let me say that, while I think the 

LIHEAP program is important, you know, I expressed my concern 

about how the formula operates. You know, the chairman and I 

both represent cold-weather States. Having assistance to low-income people is much more important in cold-weather States than 

it is in places that your constituents, Governor, and mine flee to, 

like Arizona, which get hot upon occasion but doesn’t get cold very 

much. 

And, you know, the LIHEAP program, in my opinion, was designed to help people stay warm when it was cold, not to help people cool down when it was warm. And I guess I can say that I am 

not surprised but I am a little disappointed in seeing the letter 

that is up here from the Governor of Arizona saying that she isn’t 

getting her fair share, when nobody is going to freeze in Arizona 

or in most places in Arizona. 

So having put that marker in and raising the blood pressure of 

the gentleman to my left, I will yield back the balance of my time. 

Mr. SHADEGG. Will the gentleman yield? 

Mr. SENSENBRENNER. Of course I will. 

Mr. SHADEGG. You missed my remarks. Heat kills people. It actually, all kidding aside, heat does kill people. And I am not saying 

that it is as expansive a problem as it is for cold States, nor fortunately does it last as long, but it does kill people. 

And I also pointed out in your absence that there are parts of 

Arizona where cold kills people, where, for example, our Native 

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Mr. SENSENBRENNER. Reclaiming my time, let me say to my colleague from Arizona that I thought I had him on our side on the 

whole debate on global warming. And I am afraid you are falling 

off the wagon. 

And now I will yield back. 

The CHAIRMAN. We haven’t seen that, by the way, in 2 years. 

This is a high point in our final hearing. 

The Chair recognizes the gentlelady from California, Ms. Solis. 

Ms. SOLIS. Thank you, Mr. Chairman. 

And I welcome our guest for being here. 

Governor PATRICK. Thank you. 

Ms. SOLIS. I would also like to submit my statement for the 

record, if I could do that, Mr. Chairman. 

Anyway, I just want to welcome you, Governor, here. I am excited about some of the things you are doing in your State and 

want to know how—— 

The CHAIRMAN. Without objection, so ordered. 

Ms. SOLIS. Thank you. 

Ms. SOLIS. And I would like to know how the Federal Government might help expand some of your State efforts for weatherization in the LIHEAP program. We are very concerned in the State 

of California, in my district, creating opportunities, job opportunities also in weatherization and also other technologies in the form 

of green-collar technologies. 

So, any thoughts on that? 

Governor PATRICK. A couple. 

We have been working in this area of efficiency and alternatives 

for some while now. We have some new legislation, a package of 

legislation that includes something called the Green Communities 

Act, an oceans bill, green jobs initiative, biofuels initiative, which 

are all a part of a comprehensive approach where we are trying 

both to get ahead of the issue on efficiencies and renewables and 

also create new manufacturing jobs, in particular. And we are making some progress. 

I do think that the Weatherization Program, whose funding was 

also substantially increased in the continuing resolution, I alluded 

to it briefly before you came in, but this is enormously important. 

And this is one of those examples of teaching someone to fish rather than just giving them a fish, so that we can leverage those investments at the Federal level with State money, as we are trying 

to do, and some of the subsidies that are already built into utility 

bills, to enable and to show people what strategies are available to 

them, practically help them to move into more efficient insulation, 

updating heating and cooling systems, that sort of thing. 

Ms. SOLIS. We had an initiative here in the Congress, the President actually signed a bill, the energy bill, that included about— 

proposed $125 million to create green-collar jobs. Our thoughts 

were to try to see how we can get that back through the Department of Labor and Energy and through the Workforce Investment 

Act that could go to States like yours. 

Would that be helpful, and how do you see that? 

Governor PATRICK. Absolutely. Absolutely. We have two areas, 

really three, but two I will mention, where our economy is showing 


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particularly sharp growth. One is the life sciences, and the other 

is so-called green tech. 

And the biggest concern, among many, but the biggest concern 

about the long-term future is the availability of a well-trained 

workforce. So we have tried to target more of our limited State dollars in that direction, and we welcome any Federal assistance we 

can get. 

Ms. SOLIS. Great. Okay, thank you. 

I yield back. 

The CHAIRMAN. The gentlelady’s time has expired. 

The Chair recognizes the gentlelady from South Dakota, Ms. 

Herseth Sandlin. 

Ms. HERSETH SANDLIN. Thank you, Mr. Chairman. I don’t have 

any questions for Governor Patrick. 

I thank you for being here and for your testimony and for the 

leadership you are undertaking in the State initiatives that are so 

important in serving our constituents, but also recognizing the importance of the Federal resources to help leverage those funds and 

serve more people. 

So thank you, again, for your time. 

Governor PATRICK. Thank you. 

Ms. HERSETH SANDLIN. Thank you, Mr. Chairman. 

The CHAIRMAN. The Chair recognizes the gentleman from Washington State, Mr. Inslee. 

Mr. INSLEE. Thank you. 

Governor, thanks for your leadership on this issue. 

I wanted to ask you about the relationship between efficiency 

measures, weatherization, and cash reimbursement. I suspect that 

almost probably 90 percent at least of houses, you know, a $1,000 

expenditure to weatherize the home is going to save the resident, 

over 10 years, more than a $1,000 reimbursement for their heating 

costs. 

Governor PATRICK. That is right. 

Mr. INSLEE. In almost every home, including mine, there are still 

a lot of efficiency improvements to make that are cost-effective. 

With that in mind, if you agree with that, what is the best distribution between upfront capital to help reduce those inefficiencies 

and cash reimbursement? Ideally, how would we allocate that 

fund? 

Governor PATRICK. Well, if I can respond to your question, Congressman, and also come back to the ranking member’s comments 

without wading into the debate between you and your colleague 

there, there is a—we appreciate very much the substantial increase 

in both LIHEAP and weatherization funding in the continuing resolution. But it is a stopgap. And there is a broader strategy, which 

we would look forward to working with all of you on, around how 

we move toward a more comprehensive efficiency alternative 

framework for the country. 

Until we do some of that homework, I couldn’t tell you what the 

tradeoffs exactly would be. But I can tell you that, right now, in 

Massachusetts, where we have a generally older housing stock, efficiency tends to pay back at the rate of about 20 percent a year. 

That is a pretty—so you don’t even have to look out 10 years; you 

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Now, we also have some compounding challenges, which kind of 

comes back to the ranking member’s point, differences in coldweather States than in warm-weather States, I think, and also differences in the cost of heating oil, in particular, and other heating 

sources in the Northeast because we are at the end of the pipeline. 

So the rate of payback is going to be different because the price of 

the commodities is different. 

But you can imagine, and you have, that the return in the long 

run in moving toward efficiency is greater than having to come 

back every year and spend—it is not that we may get away from 

that entirely, at least in the short run, but having to come back 

every year and reappropriate for more straight cash assistance. I 

hope one day we will be able to wean ourselves of that. 

Mr. INSLEE. Well, some of us think it is better to try to do the 

weatherization and insulation and maybe reduce the rate of global 

warming, rather than just wait for your climate to change so that 

you become a problem of heating rather than cooling. 

Governor PATRICK. That is not what I am advocating. 

Mr. INSLEE. Okay, I just wanted to make sure that is the situation. 

Thank you, Governor. 

Governor PATRICK. Thank you. 

The CHAIRMAN. The gentleman’s time has expired. Actually, Governor, in last year’s budget, there was $228 million 

for weatherization. In the continuing resolution yesterday, it was 

increased to $478 million. 

Governor PATRICK. And we very much appreciate it. 

The CHAIRMAN. More than a doubling. And hopefully more innovative programs will flow out of Massachusetts and Wisconsin and 

other States that can help to chart a new course, and Arizona and 

southern California and—— 

[Laughter.] 

Mr. SHADEGG. Mr. Chairman, we need to insulate in Arizona as 

well. 

The CHAIRMAN. I hadn’t finished my question. It was a run-on 

sentence with no period that had yet arrived. 

Some of my happiest memories are at Fort Huachuca, Arizona, 

in the summer of 1969. It didn’t go under 110 any day, and I am 

willing to stipulate the conditions that existed there. 

So we thank you, Governor, very much for being here. Any closing statement you would like to make? 

Governor PATRICK. Just again, you know, I think probably you 

don’t hear from us with thanks as often as you are entitled to or 

you should. And we thank you very much for the support through 

the continuing resolution. And we urge the Senate to act similarly 

and the President to sign the bill. 

The CHAIRMAN. On that subject, we are in total permanent concurrence, hoping the Senate will do the right thing. You know, that 

is something that is the overarching reality of our lives. 

Wonderful to see you again, Governor. Thank you for your great 

testimony. 

Governor PATRICK. Thank you. 

The CHAIRMAN. Appreciate it. 

Our second panel, we would invite them up to the witness panel. 


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On our second panel, we have Mark Wolfe, who is the executive 

director of the National Energy Assistance Directors’ Association, 

representing the State directors of the Low Income Home Energy 

Assistance Program. 

We welcome you, sir. Whenever you are ready, please begin. 

STATEMENTS OF MARK WOLFE, EXECUTIVE DIRECTOR, NATIONAL ENERGY ASSISTANCE DIRECTORS’ ASSOCIATION; 

JOHN DREW, EXECUTIVE VICE PRESIDENT, ACTION FOR 

BOSTON COMMUNITY DEVELOPMENT, INC.; HOWARD 

GRUENSPECHT, ACTING ADMINISTRATOR, ENERGY INFORMATION ADMINISTRATION 

STATEMENT OF MARK WOLFE 

Mr. WOLFE. Thank you. 

First, on behalf of the members of NEADA, I would like to first 

take the opportunity to thank the members of the select committee 

for holding today’s hearing on the importance of higher funding for 

LIHEAP to help low-income families pay their home energy bills 

this winter. 

LIHEAP is the only Federal program that helps families pay 

their home energy bills. There is no comparable program for gasoline, for example. 

The discretionary grant program in fiscal year 2008 only had sufficient funding to meet the energy needs of about 16 percent of the 

Nation’s poorest households. Rising energy prices are placing millions of low-income families at risk of losing access to home energy. 

We are witnessing record arrearages across the country, as families struggle to pay high energy bills and utilities, as well as families struggling to pay delivery fuel bills for heating oil and propane. 

This is followed by high rates of shutoffs, as families lose their ability and access to utility service. 

The good news, actually, the excellent news, of course, is the 

House already nearly doubled funding for LIHEAP to $5.1 billion 

and added $250 million for weatherization. Hopefully, this will lead 

to a policy discussion in the next Congress as to the appropriate 

level of funding for LIHEAP and its place in the social service system in the future, as we continue to cope with high and volatile 

pricing for all forms of home energy. 

And I think, just to give a sense of what this $5.1 billion means: 

In Arizona, it would take us from $9 million last year to $29 million; California, $103 million last year to $225 million; Massachusetts would go from $126 million to $163 million; Wisconsin, from 

$91 million to $130 million; South Dakota, $17 million to $30 million; and Washington State, $45 million to $75 million. 

What this really means at the end of the day, at $2.5 billion, 

which was the amount of money we had last year, it was really 

only enough money to provide a minimally adequate program in 

the cold-weather States and, at best, an emergency program in the 

rest of the country. That is what $2.5 billion bought us. But $5.1 

billion really transforms the program, creating a truly national 

basis for providing home energy assistance across the country for 

both heating and cooling. 


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One of the issues that came up a lot in the last couple of months 

was why were we asking for $5.1 billion. First, winter home heating costs have been increasing rapidly since the end of the last economic recession in 2002. 

One of the tables we prepared, since the last recession ended in 

2002, home energy prices have gone up dramatically. Heating oil 

went from $912, the cost to heat a home during the winter of 2002– 

2003, to an estimated $2,500 during the coming winter heating season, or an increase of about 176 percent. In the coming winter season, prices are expected to go up about 30 percent. Natural gas increased by 69 percent, propane by 105 percent, electricity by 34 

percent, during this period since 2002. 

What is really worrisome to us about this is that energy went 

from a period of being basically affordable, back in 2002 to 2003, 

to an awful lot of Americans. There were many low-income families 

that could afford to pay the average of $681. But with an average 

cost starting to press $1,200, we are finding more and more families that just can’t pay these bills. More families are falling behind 

on the utility and the natural gas and electric bills, and more and 

more arrearages and shutoffs. 

The other issue, of course, is purchasing power of LIHEAP. Without the $5.1 billion, we would have seen a dramatic decrease in the 

purchasing power this winter. In 2006, when LIHEAP funding 

peaked at $3.2 billion, we were able to cover close to half the cost, 

on average, of home heating. It wasn’t terrific; it didn’t meet all the 

needs. But it allowed us to negotiate with utilities, allowed us to 

deal with arrearages, and allowed us to cover significant costs of 

the cost of delivered fuels. 

With the continuing rise in energy costs, last year we were only 

able to cover about 36 percent of the cost of home heating. It was 

definitely not enough. And the kinds of things that happened last 

year that we hope won’t happen this year is we will see fewer people basically suffering. We saw people basically being shut off from 

power. We have had reports in some utility districts of up to 10 

percent of the households being shut off. In some cases, it amounts 

to a small city within a State losing access to electricity and natural gas. 

If you look at the next table, one of the things that concerns us— 

yes, heating oil costs are coming down, and that is terrific. In the 

middle of July, we were looking at upwards of $5 a gallon for home 

heating oil. Now we are in a range of $4. So, in a sense, that 

sounds terrific. But that is still a dollar more a gallon than what 

it was last year at this time. 

And what that really means, to fill up a 275-gallon tank, typical 

tank of heating oil in the Northeast, it is close to $1,000 now. For 

many people, especially elderly, that is more than their entire 

monthly income. The average single person who gets Social Security gets $1,027 a month. That is about the cost of one tank of oil. 

Another indicator of the rising need for energy assistance is the 

increase in arrearages and shutoffs. The National Regulatory Research Institute, for example, in a recent report, found that pastdue gas utility accounts rose from 16.5 percent in 2001 to 21 percent in 2006. Last spring, in a survey we conducted, States reVerDate Mar 15 2010 04:59 Nov 19, 2010 Jkt 062130 PO 00000 Frm 00033 Fmt 6633 Sfmt 6602 E:\HR\OC\A130.XXX A130

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ported that 1.2 million households were cut off from natural gas 

and electric service due to nonpayment of electric bills. 

What I would like to do briefly is give for you a couple of numbers that we have collected in the last 2 months that I think give 

a sense of just how serious this affordability problem is and how 

we think the $5.1 billion will really make a big difference in addressing the need. 

For example, across the country—and, again, we don’t have national statistics on shutoffs, arrearages, how many people are behind in their home heating bills. But the numbers we are getting 

are very, very scary. In Arizona, the Public Service Commission reported that disconnections are up 40 percent over last year. Southern California Edison, for example, has shut off nearly 165,000 of 

its 4.8 million customers in the past 6 months. Xcel Energy in Colorado expects to shut of 72,000 Colorado customers this year because of delinquent bills, a 33 percent increase from 2007. In Massachusetts, for example, at the end of May, Natural Grid reported 

that 115,000 out of 1.2 million electric customers were at least 3 

months behind on their bills. And the numbers continue. 

What I would like to do is just briefly review a survey that we 

conducted in June. We wanted to find out how families were coping 

across all income ranges. And we asked how they were coping with 

high gasoline and home energy bills. Because I believe that some 

of the reason for the increase in arrears and shutoffs is not just 

that home energy bills are going high, it is that families don’t have 

enough money to pay for gasoline. The average family uses about 

800 gallons of gasoline a year. So if gasoline is running about a dollar a gallon higher, that is about $70 more a month than they were 

paying last year at this time. 

We surveyed 500 families across the country in all income 

groups, and what we found was—we weren’t surprised to see that 

poor families, those with incomes of under 150 percent of poverty, 

were responding that they were having trouble of paying their energy bills. What we were worried about and surprised was that 

somewhere between 151 and 250 percent of poverty, basically 

working families, were finding that they were also reporting difficulties in paying these bills. 

We asked the question about whether energy costs had a large 

impact in a household, and, again, families under 150 percent of 

poverty, those making about $35,000 a year, said yes. About 38 

percent reported difficulties paying it, but also about 19 percent of 

the next group up also said the same thing. Basically, families between about $35,000 and $50,000 a year were saying they were 

also struggling with these bills. 

But, of course, the thing that was most worrisome was the next 

one, where we said, well, okay, because of high energy and gas 

costs, did it change your purchasing plans? And we always knew 

that poor families had this problem. In all the previous surveys, 

very poor families always said they had to choose between heating 

and eating. But what we found this time, which is what really 

alarmed us, was families between 150 and 250 percent of poverty 

mainly were saying the same things. 

And these are families that normally we don’t cover in energy assistance programs because we don’t have enough money. And one 


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of the advantages of going to $5.1 billion is the law, in the House 

bill at least, allows us to go to 75 percent of State median income. 

So for families in this next group, between 150 and 250, who are 

saying they are having trouble buying food, medicine, basic necessities, they can also be helped in this program this year. 

The next chart, of course, is a sign of poverty, but, again, it is 

the next group up, also, that is reporting it. We asked them questions, did you close off parts of your home? Did you keep your home 

at an unsafe temperature? Did you leave the home part of the day 

because it was too cold or too hot? And, again, we are seeing families that earn between 150 and 250 percent saying the same thing 

some of the very poorest families in the country are saying. 

And, of course, the next chart is the one that causes most concern. We asked about skipping bill payments and also shutoffs. 

And 29 percent of very poor families said they skipped paying their 

electric bill or utility bill, but 8 percent said they were shut off. But 

also families between 150 and 250 percent of poverty reported some 

of the same exact numbers. 

So what seems to be going on, I think, is a compression across 

incomes, that it is no longer just the families earning less than 

$35,000 a year, I think it is becoming families earning less than 

$45,000 to $50,000 a year who are basically struggling to make 

ends meet. 

What I would like to do is talk just briefly, at this point—you 

were asking some questions about weatherization. And, essentially, 

we don’t think it is an either/or. We don’t think it is either weatherization or home energy assistance. Under the LIHEAP program, 

States are allowed to transfer up to 15 percent of their LIHEAP appropriation to weatherization. And, on average, about 10 percent of 

that is transferred. So if the future is as in the past, then about 

$500 million of the $5.1 billion will also transfer into weatherization programs. 

These are extremely successful programs, but they are not wellfunded. Last year, only about 150,000 homes across the country received weatherization assistance. Weatherization returns about 

$2.72 cents in energy and nonenergy benefits of the life of a weatherized home. It is a terrific investment. It also supports about 

20,000 jobs that come through the program. These are the green 

jobs that we are concerned about. 

And when thinking about green jobs or green-collar jobs, the potential in the low-income community is significant for weatherization. You know, about 25 percent of the families in the United 

States are low-income, and about 40 percent come under the 250 

percent of poverty category. Many of these families can benefit 

from weatherization, and a lot of the jobs are not that highly 

skilled. So it is a great, sort of, entry point into a career for a lot 

of people right out of high school. 

Another point I would like to mention to, sort of, wrap up my testimony, we have been looking a lot at other strategies to weatherize homes. We have been working with the Ford Foundation to 

develop an energy-efficiency mortgage program that would help 

families integrate weatherization and energy efficiency as part of 

their mortgage. And this is a real opportunity, as we look at all 

these subprime mortgages that are in trouble now that need to be 


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refinanced, to also make their homes more energy efficient at the 

same time. 

For families that make less than $50,000 to $60,000 a year, reducing their energy bill by 30 percent makes a very significant difference to their discretionary income. It not just reduces their energy bill, it strengthens their ability to maintain their home. I 

think there is a great opportunity this coming year, as we look at 

how do we help low-income families move to a more stable mortgage, look at making the home energy efficient at the same time. 

It will accomplish two very related goals. 

Thank you. 

[The statement of Mr. Wolfe follows:] 


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The CHAIRMAN. Thank you, Mr. Wolfe, very much. 

Our next witness is Mr. John Drew, who is the executive vice 

president of Action for Boston Community Development, the largest nonprofit agency in New England. He has been a very prominent figure in this whole area of LIHEAP throughout his career, 

a real national expert on the subject. 

Whenever you are ready, Mr. Drew, please begin. 

STATEMENT OF JOHN DREW 

Mr. DREW. Thank you, Mr. Chairman. Thank you for letting me 

come before you today. 

First of all, I want to thank you because you are my congressman, and I want to thank you for everything you have done over 

the years. 

Action for Boston Community Development is a community action agency, one of 900 across the country. What we do is we are 

undergirded by a community service block grant, which we are so 

much grateful to this Congress for continuing that program, because it allows us to do a variety of programs, including Head 

Start, weatherization, our heating assistance program. We also do 

programs for—we run a college, we run high schools. We will do 

anything that we need to do to help people who are poor. 

Mr. Chairman, I just want to make a note that you are my Congressman, and I very much appreciate the hard work you have 

done over many, many years. 

The CHAIRMAN. I thank you. 

Mr. DREW. Really. You have been a true champion. 

The CHAIRMAN. Thank you. 

Mr. DREW. And I also want to note that I am so grateful for the 

Governor of Massachusetts coming here today. I won’t cast anything other than to say this is the first Governor in my time who 

has come before you on LIHEAP, and he has done a heck of a job 

in Massachusetts. 

I mentioned the community service block grant and I mentioned 

community action because they go together. I go back 36 years. I 

know I don’t look it. I go back 36 years, back to the OPEC time, 

when we had that spike with that OPEC where the lines were long. 

And we have had over 36 years of trying to keep this program 

going through the ups and downs, through the period of time when 

we had enough money, we didn’t have enough money. We put together weatherization programs. We put together programs that 

provided for new boilers. We have matured to the point where we 

are actually doing windows and refrigerators and appliances, working with utilities. But I must say from the bottom line is that we 

are dealing with people who do not have enough income to live on. 

I left my office today to take an airplane. Lined up in the corridors in our buildings were people who got there early this morning, had been getting there for quite a while, clutching in their 

hands shutoff notices, payments they can’t make, looking very, very 

scared, bleak, and wondering how they are going to get through the 

winter. 

My experience over the years is that, if we do not intervene, we 

will see experiences of hypothermia. We have seen that. We have 

a woman, 94 years old, who went to bed one night, decided that 


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she couldn’t afford the heat, couldn’t pay the bills, put as many 

blankets on as she could, and unfortunately in the morning she 

didn’t get up. We have children who leave their house to go to 

school and they are not able to think because they have been cold 

all night. 

We have a large Head Start program in the city of Boston. And 

thank you again, Congress, for keeping that and reauthorizing the 

Head Start program. But we have 2,600 children in Boston in preschool, and for many, many of those children, the only heat or the 

major part of the heat, warmth they have that day is when they 

come to the center. Their major caloric intake will be at that center. 

So I was, with great fear and trepidation, going into this summer, with $5 a gallon. All I could think of was the Arctic air is coming. It is going to be icy, it is going to be cold, we are going to have 

ground freezing, we are going to have snow. And what is going to 

happen to all these folks? This is my Katrina. This is my Northeast. 

These people are going to be standing out there with no ability 

to save themselves. They don’t have incomes to be able to buy the 

product that is necessary. They are also trying to struggle to buy 

milk that are increased and to buy products that have increased. 

Their incomes have not gone up at all; they really have been compressed. 

So I am here basically to bear testimony on the part of so many 

people who need this program, whose families—and, as Mark Wolfe 

has said, more and more people are falling into the trap of stagnated wages and not being able to take care of their families. And 

it is an income issue. 

And over the years I have struggled when people have come up 

with a debate, which is we should do more weatherization and less 

of the fuel assistance. And I say fine, fine, let’s get the cost of energy down to the point where people can afford it. You cannot take 

out payments before you can get the energy efficiency and we can 

bring down the oil price from overseas. 

So I think that we not only need both, we have to keep up with 

the income. We, in fact, in our program, we pay the dealers directly. We work with the dealers. We work with the companies. We 

have great relationships and, as a result, have been able to run a 

LIHEAP program. Every LIHEAP household who is eligible also is 

eligible for conservation, for boiler repair, boiler replacement. They 

get discounts from utilities up to 20 percent off their bills. So we 

are leveraging an awful lot through this LIHEAP program. 

The downside is that we are getting more and more people in our 

homeless shelters. And in Massachusetts, in fact, there are 500 or 

600 families in hotels as a result of not being able to maintain a 

household. My concern, going into this winter, is we are going to 

see an epidemic of homelessness. 

So I was coming down here with bags of cement on my back, saying, how are we going to do this? We are going to run out of assistance before Christmas. We are going to be trying to figure out how 

we can keep these families and elders alive. And when I got the 

call that said $5.1 billion has been passed by this House, I just 


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said, ‘‘Oh, my God, this is great.’’ And the Senate has to pass it, 

the President has to sign it. 

And, with that, we will be able in Massachusetts to be able to 

provide heating assistance right through the end of February. 

Think about that. We have so many people who are sitting there 

right now, saying, how am I going to make it? 

Everybody has their following story, but it is true. In my building 

today was Mr. Warren. He comes in, he is 78, and he is looking 

for assistance. And he is working at an elderly program, our foster 

grandparent program. 

I said, ‘‘How are you doing today?’’ And he said, ‘‘Well, my wife 

and I, it is a little tough, but, you know, we are getting by. It is 

going to be a tough winter.’’ I said, yeah. He said, ‘‘Where are you 

going?’’ I said, ‘‘I am going down to testify before a committee in 

Washington about heating assistance.’’ He said, ‘‘What is that all 

about?’’ I said, ‘‘Well, you know, trying to get you some more money 

so you can get through the winter.’’ His wife has these huge bills 

for her disabilities, her medicines. 

He said, ‘‘Would you tell those folks something? I am really concerned. I don’t understand how they can understand they can find 

trillions of dollars for bankers and stuff and they can’t help me get 

through the winter.’’ I said, ‘‘I will pass the story along,’’ which is 

true. And I can appreciate that this committee understands that 

feeling of helplessness, that nobody is really going to be there for 

you. So the $5.1 billion, let’s hope that goes through. Let’s hope we 

have it at the end, let’s hope we have it at the beginning of the 

season, so we can assure people that they will have hope through 

the winter, that they will be able to buy their food, that they will 

be able to buy their medicines, they will be able to live life normally, they will get through the winter. 

Because, right now, what we have, Mr. Chairman, in Massachusetts is 100,000 households way behind in their utility bills. We 

have 20,000 households already shut off. 

The CHAIRMAN. Mr. Drew, thank you. Thank you for your passionate presentation today. We really appreciate it. Thank you. 

Mr. DREW. Thank you. 

[The statement of Mr. Drew follows:] 


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The CHAIRMAN. Now we will move to our final witness. Then we 

will go to questions from our committee members. 

And our final witness is Mr. Howard Gruenspecht. He is the acting administrator of the Energy Information Administration at the 

Department of Energy. Prior to joining EIA, he was a resident 

scholar at Resources for the Future and served as its director of economics. 

We welcome you, sir. Whenever you are ready, please begin. 

STATEMENT OF HOWARD GRUENSPECHT 

Mr. GRUENSPECHT. Mr. Chairman, members of the committee, I 

appreciate the opportunity to appear before you today to discuss 

the short-term energy outlook for the United States, particularly 

for the upcoming winter. 

The Energy Information Administration is the independent statistical and analytical agency within the Department of Energy 

that produces objective, timely and relevant projections and analyses to assist policymakers, help markets function efficiently and 

inform the public. And I notice that Mark Wolfe mentioned many 

of our products. We don’t promote, formulate or take positions on 

policy issues. And our views should not be construed as representing those of the Department or the administration. 

Our most recent short-term energy outlook, released on September 9th before Hurricane Ike hit the Gulf Coast, forecasts that 

residential upcoming heating oil prices during the upcoming heating season of October through March will average 4.13 per gallon, 

an increase of about 25 percent over the previous season. Residential and natural gas prices over the same period are projected to 

average nearly $15 per thousand cubic feet, an increase of about 

17 percent over the previous heating season. Price increases for 

propane and electricity are projected to be about 11 percent and 8 

percent respectively. 

Natural gas is used as the primary heating fuel by a majority of 

U.S. households, while oil is the primary heating fuel for about 7 

percent of U.S. households. But, as the other two witnesses have 

noted, heating oil use is heavily concentrated in the Northeast, 

where it is used by nearly one-third of households. 

Fuel expenditures for individual households are highly dependent on weather conditions, the size and efficiency of individual 

homes and their heating equipment, and thermostat settings. So 

while cross-fuel comparisons of average heating expenditures can 

be misleading because of differences in the extent to which each 

fuel is used in colder and milder areas of the country, the change 

in projected expenditures relative to the prior winter for each heating fuel provides a broad gauge as to expected movements in heating costs. 

Although all of the major heating fuels are expected to register 

sizable increases in total expenditures, heating oil customers are 

likely to be particularly hard hit, with heating fuel expenditures for 

the average household using oil as the primary heating fuel expected to rise by $585 over last winter. The corresponding increases for households heated with natural gas and propane are 

$162 and $217 respectively, while they are $86 for households 

using electricity. 


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Heating oil prices are expected to be significantly higher than 

last winter, primarily because crude oil prices are much higher. 

Higher crude oil prices account for about 68 cents per gallon of the 

projected increase of 85 cents per gallon over the upcoming heating 

season relative to the comparable year ago period. 

Increases in heating oil prices above those due to higher crude 

oil costs largely reflect tighter markets for diesel fuel worldwide. 

Diesel fuel and heating oil are connected, as both products are very 

similar, except for the fact that diesel fuel contains less sulphur 

than heating oil. 

World diesel fuel demand growth is coming both from increasing 

transportation use and increasing use of distillate as a fuel for electricity generation, particularly in developing countries. And there 

are also a number of special circumstances this year. 

Turning to natural gas markets, the factors contributing to higher prices include higher oil prices, low imports of liquefied natural 

gas, and some strength in the spot prices of natural gas in the first 

half of the year that will be reflected in the cost of gas that has 

been stored to be used this upcoming winter. 

Colder than normal temperatures during the first 4 months of 

the year contributed to a substantial year-over-year decline in inventories of gas. 

The good news is that, taken together, robust domestic production of natural gas and limited consumption growth in electric 

power this summer due to relatively mild summer temperatures allowed for rebuilding of natural gas storage inventories. And, by the 

end of August, we actually were ahead of the 5-year average for the 

first time since February. 

We will be updating these forecasts for the October edition of the 

‘‘Short-Term Energy Outlook,’’ which will also include an expanded 

discussion of the upcoming heating season. 

That concludes my statement, Mr. Chairman, and I would be 

happy to answer any questions that you or the other members may 

have. 

[The statement of Mr. Gruenspecht follows:] 


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The CHAIRMAN. I thank you very much. 

And now we will turn and have the members of our committee 

ask questions. 

I recognize the gentlelady from California, Ms. Solis. 

Ms. SOLIS. Thank you, Mr. Chairman. 

All of you have given us some interesting insight, including the 

Governor. 

But I wanted to just ask our last witness who spoke if you could 

shed some light on the recent effect that we saw in some Midwestern States with respect to Ike, Hurricane Ike, where we saw 

some shortages in Tennessee and, you know we saw a tremendous 

spike up in demand there. Obviously, we may see more of that happen as we see more hurricanes hitting our areas where our major 

producers of crude and the refineries are found. 

Can you shed any light on that? 

Mr. GRUENSPECHT. I can shed a little bit of light on it. 

Clearly, the two hurricanes that hit the gulf, one Louisiana, the 

other Texas, which are both big areas for importing crude oil and 

big areas for refinery production, had an impact. Although refinery 

capacity is really returning, really—in today’s report, for the first 

time, the amount of refinery capacity out is under a million barrels 

a day of capacity. It had been up above, well above 3 billion barrels 

a day out at the peak. So there has been progress in bringing 

things back. 

But the areas that are served either from crude oil that comes 

through the gulf, because some of the crude oil that is used in the 

Midwest comes through the gulf and is shipped up to the Midwest 

by pipeline, or by products that are produced in the gulf—and that 

has affected most of the south Atlantic States; Tennessee, North 

Carolina, Georgia has had some issues—those are the areas that 

have seen the most severe impacts. We have seen prices in those 

areas falling in recent days. 

Just yesterday, we put out a report on inventories that, sort of, 

looks at the last week. The last week was a tough week, in that 

production was severely impacted by Hurricane Ike. We do see the 

situation improving. There may be some spot outages, mostly of 

gasoline. Fortunately the distillate market has done better. The 

diesel fuel and heating market has not seen those outages. But gasoline is a little tight. 

Ms. SOLIS. I guess, for me, I really have some concerns when we 

have discussions and debate about increasing more drilling along 

the southern part of our country here, and how rapid that infrastructure will go up, and how many times in each season will we 

find ourselves in a similar situation, that natural recourses like 

hurricanes and others are still going dampen our ability to be able 

to get those products to market into that part of the country. 

And shouldn’t we be thinking about other alternative types of 

fuels? And some of you have mentioned that; I know the Governor 

did in his presentation. But it just hits home again that somehow 

we continue to be so reliant on the old way of doing things, and 

we are not really looking at projecting what is currently happening 

with the current state of our country. 

And I want to thank Mr. Drew for coming all the way up from 

Boston, Massachusetts, because the program you talk about is very 


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similar to one in my district that provides services actually through 

Veterans. And they have veterans who are employed who come 

back that are either disabled, that get these jobs in the LIHEAP 

program, do weatherization in California. 

Our temperatures are a lot different, but we also have very 

needy families as well. We always find that there is a backlog of 

families that need to have this assistance and not enough money. 

And the Community Development Block Grant Program has suffered tremendously under this administration, And we need to find 

other ways of infusing dollars. 

And I am wondering if maybe programs like, for example, HUD, 

Department of Energy, and even EPA could somehow better collaborate with the Community Development Block Grant Programs 

when we look at weatherization or trying to help restructure our 

old buildings, even for landlords in some of our public housing. Because I am very concerned that, when we talk about, for example, 

even removing lead paint in old buildings, at the same time these 

same housing structures are maybe built in the 1930s or 1920s and 

could use some other forms of assistance. 

But we are not talking to each other, so it may not be another 

10 years before the department of HUD or someone else go out 

there, and that we are piecemealing, we are just putting a little 

Band-Aid on a much far greater program. I mean, disease that we 

see in housing and with our poor stock of housing in areas like 

southern California. 

What are your thoughts on that? 

Mr. DREW. I have spent a lot of time over these years trying to 

take the silos and put them together as best we can. And we do 

a certain amount of work, we have done work with the Department 

of Energy. And the things we run into, for example, are asbestos 

removal. 

Ms. SOLIS. Or lead. 

Mr. DREW. And you get in, and all of a sudden you have regulations and other things you have to deal with. 

So any time we are dealing with trying to get something done in 

a household, we have to be well aware of all of the other rules and 

regulations. So we do, as best we can, try to pull together resources, working with city hall, CDBG black grant. We try to put 

something together with DOE. But I would not want to say to you 

that we feel comfortable that we are maximizing our resources and 

target them as directly as we can. 

Ms. SOLIS. Thank you. Thank you very much. 

The CHAIRMAN. The gentlelady’s time has expired. 

The Chair recognizes the gentlelady from South Dakota. 

Ms. HERSETH SANDLIN. Thank you, Mr. Chairman. 

I represent the State of South Dakota. I also have the honor of 

representing nine sovereign Sioux tribes within their reservation 

boundaries, primarily within the State of South Dakota. 

You know, our temperatures—we have drastic ranges of temperatures. And even without a wind chill, we can be many degree 

below zero. And then when you add the wind chill, we have had 

record temperatures anywhere from negative-40 to negative-70 

below zero. 


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So a couple of years ago—and, actually, even, I think, last year— 

we had reports from one of the tribes that I represent that people 

in very rural outlying areas were burning clothing in order to stay 

alive and warm, because we are dealing with severe poverty in 

many of these areas, as well. 

And I guess my first question would go to you, Mr. Wolfe. I have 

had some discussions with the Rosebud Sioux Tribe about how they 

didn’t get leveraging incentives last year because there was language omitted in the fiscal year 2008 budget. And so if you could 

talk a little bit more about the LIHEAP leveraging incentive and, 

as well, the Residential Energy Assistance Challenge option. Because, again, I am wondering if other States or communities are 

experiencing the same problem because of that omitted language. 

And then, in general, could you just discuss whether you think 

tribes face particular challenges with regard to energy assistance 

for their members, especially in more rural areas? 

Mr. WOLFE. Yes, I would be glad to. 

There was an omission in the fiscal year 2008 appropriation for 

LIHEAP, so leveraging wasn’t funded, nor were reach grants. For 

some States, this created a problem, because leveraging funds are 

the funds they use often to fund their discretionary activities, to 

provide supplemental energy assistance. 

Leveraging is also targeted, weighted toward small-population 

States. So where large States receive about 1 percent—I mean, it 

doesn’t pay a lot. Leveraging, on average, pays only about 1 or 2 

percent of the total amount of money that is raised outside of 

LIHEAP. But for small-population States, it can go to 3 percent, 

which can be quite significant. It can be $100,000, $200,000. So we 

heard from a number of States that really was a problem and they 

had to cutback services. 

REACH is really the demonstration grant part of LIHEAP. We 

don’t really have a dedicated research budget in LIHEAP other 

than the REACH grants. And this was the first year since it was 

started that we didn’t have funding. Again, it seemed to be an 

omission in the law. 

And HHS decided—they had to go ahead and reallocate those 

funds, I think it was in June. Because we thought maybe they 

could wait, but they said they couldn’t wait for a fix in the law. 

So the seven or eight demonstration grants that would have been 

given out weren’t given out. And they are multiyear and they do 

make a difference to the local agencies that use them, because they 

are really designed to create new approaches to funding energy assistance. 

And then lastly, your question on tribes. It is different in each 

State. In some States the tribes act as basically sovereign nations, 

so they receive funds directly from HHS. In other States, they receive funds through the States. The State acts as the grantee. 

I have looked at the numbers, and, frankly, the allocation for 

tribes, in many cases, they are just very, very small, especially in 

light of the poverty on some of the reservations. 

Ms. HERSETH SANDLIN. Does it differ? And when you describe— 

what have you seen in the disparities of what tribes get if they are 

getting the direct allocation versus what they end up getting if they 


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have to go in terms of the block grant through the States? Is there 

a discrepancy you have seen in that analysis? 

Mr. WOLFE. Some States have told me that, if they go under the 

block grant, the tribe will receive more money. 

Ms. HERSETH SANDLIN. Some States have told you that. Have 

you verified that? 

Mr. WOLFE. I haven’t done any research on it. But they have said 

they have offered—they have talked to the tribes about going as 

part of the block grant and then give them a higher allocation. But 

they said that many tribes would prefer to stay as sovereign nations for the purposes of dealing with HHS. 

I think that, because tribes overall don’t receive that much 

money from the program, this is something worth looking at. 

Ms. HERSETH SANDLIN. Thank you. 

Before my time expires, just one other quick question for Mr. 

Gruenspecht. 

The CHAIRMAN. Our problem is this. There are 12 minutes left 

to go on the House floor, and the gentlelady only has 30 seconds 

left. 

Ms. HERSETH SANDLIN. Yes. 

The CHAIRMAN. So I would like to be able to recognize the other 

two—— 

Ms. HERSETH SANDLIN. Just a question on propane, because 

many people I represent rely on propane, the recipients of propane 

for heating fuel. 

Mr. Gruenspecht, could you just discuss the price trends for propane in recent months and years, and what families who rely on 

propane can expect this winter? 

Mr. GRUENSPECHT. Yeah. Let me quickly try to flip to that. 

I think propane is not as tough a situation as heating oil; probably is the second toughest situation. So for propane, nationally we 

would expect a 13 percent increase in expenditures. And I am trying to think whether you are in the West or the Midwest. 

Ms. HERSETH SANDLIN. Both. 

Mr. GRUENSPECHT. Probably both. You are a big State. In the 

Midwest, 11.4 percent increase in expenditures for propane. 

The CHAIRMAN. The gentlelady’s time has expired. 

The Chair recognizes—we will divide it into 3 minutes apiece— 

the gentleman from New York, Mr. Hall. 

Mr. HALL. Thank you. 

I will submit my statement for the record and just ask two questions, if you could answer me, starting with Mr. Drew. Even with 

the $5.1 billion appropriation, is it possible or even likely that more 

contingency funds will be needed this year? 

Mr. DREW. I hope not. I hope not. Just quickly, we could use—— 

Mr. HALL. That is fine. That is quick enough. Thank you. 

Mr. Gruenspecht. 

Mr. GRUENSPECHT. That would be a policy question, so I would 

pass that to Mr. Wolfe. 

Mr. HALL. Mr. Wolfe? 

Mr. WOLFE. Well, using EIA’s data, no, $5.1 billion won’t be 

enough. If you look at the Northeast, low-income families paid $14 

billion for heating oil last year. This year it is going to be in the 

range of $17 billion. If the additional money was just part of the 


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heating oil, they would use it all up. So it is quite likely that we 

will need more money. But, again, you know, in a practical sense, $5.1 billion is an enormous increase. So it is sort of half a dozen of one, six of another. 

Mr. HALL. Okay, thank you. 

The second thing is the administration, in their bill, tried to kill 

the weatherization assistance program, and we restored that today 

in the House bill. 

Do you have a suggestion as to how we can better coordinate 

LIHEAP, low-income heating assistance, with weatherization expenditures in order to maximize effectiveness? 

Mr. WOLFE. I think we have a terrific partnership now in most 

States. State agencies work very closely together, in many States 

in the same office. The problem is there is just not enough money 

in weatherization. That is the real bottom-line problem. 

Mr. HALL. Do the other gentlemen concur? I guess you concur. 

Mr. DREW. In Massachusetts we have a deregulation, so we are 

doing more weatherization through utility companies. That doubled 

our weatherization. 

Mr. HALL. That is good. Thank you. 

I yield back. 

The CHAIRMAN. The gentleman from Missouri, Mr. Cleaver, is 

recognized. 

Mr. CLEAVER. Thank you, Mr. Chairman. 

Let me apologize, first of all, for not being here. I am on what 

is essentially the Banking Committee, and we have been at it all 

day yesterday and today. I apologize. But I came over even though 

that committee is still going, because I—but I think Mr. Hall asked 

the primary question that I was going to ask. 

I will throw a softball; anybody can hit it. I would imagine Mr. 

Drew has already swung at it before. 

But we are going to have to do a rescue program. We are going 

to have to do it—have to. Do you think that the current level of 

funding for LIHEAP will allow those who are struggling to have 

any level of appreciation for a rescue program of Wall Street? 

Mr. DREW. I don’t know if they will have an appreciation. They 

are trying to live by themselves. I did mention that there was a 

person who said, ‘‘I don’t understand how they can spend trillions 

of dollars and not help me get through the winter.’’ They are making a direct connection between the two. 

Mr. WOLFE. No, I don’t think so. When you look at incomes for 

families making less than $50,000 a year, they are living paycheck 

to paycheck. Across the board, the last 5 years, between higher 

health-care costs and now higher energy costs and higher rental 

costs, they just don’t have any resources. So when you talk about 

a $700 billion bailout, the number is so enormous. The average 

family only saves $300 a year now. 

I think that LIHEAP helps, I mean, certainly helps take some of 

the edge off of this. But the magnitude of the bailout versus—you 

know, LIHEAP is what? Less than 1 percent of the total bailout 

amount. It is hard to get your hands around the bailout numbers, 

I think. 

Mr. CLEAVER. It is less than that? 

Mr. WOLFE. Yes, it is less than 1 percent. 


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Mr. CLEAVER. Thank you, Mr. Chair. 

The CHAIRMAN. The gentleman’s time has expired. 

We are going to give each one of you 30 seconds to tell us, in 

summary, what you want us to remember. There are four roll-calls 

on the House floor. You have 30 seconds to have something ring 

through our brains for the rest of this session and winter, in terms 

of this program. 

We will start with you, Mr. Wolfe. 

Mr. WOLFE. I would say a fully funded LIHEAP and weatherization program working together will make the difference between 

families not being able to afford access to electricity, natural gas 

and heating oil and being able to afford it. 

The CHAIRMAN. Mr. Gruenspecht. 

Mr. GRUENSPECHT. We need to work with the States throughout 

the winter. And we have a State heating oil and propane program. 

We will be tracking the prices on a weekly basis. 

I think there are other improvements we need to make. In particular, this year we have had a lot of exports of distillate fuel. It 

took us a while to catch up with that. That is something that I 

think a better data program would be helpful, in tracking movements of products. 

The CHAIRMAN. And you have the final word, Mr. Drew. 

Mr. DREW. Well, I, first of all, thank you. And what we are talking about is money that is filling a hole in the face of poverty. I 

am glad that it is happening, but I think I want to think about an 

overall anti-poverty effort, I hope, in the new administration. 

I would like to just end today, because I know you are busy, but 

we know that to end the cycle of crisis that drags the hardworking 

families and retirees into a path of economic insecurity, your climate and protection act, H.R. 6186, is the best proposal. We have 

considered devoting significant investments to making low-income 

communities and housing sustainable and affordable. It is fair, 

does not waste resources or give away to polluters or energy vendors. It is consistent with the fair climate change principle. The 

community action has developed, with the National Community Action Foundation, Friends of the Earth, Public Citizen, the National 

Consumer Law Center. And, with your permission, I would like to 

submit these as part of my testimony. 

And I wish very much to thank you very much. 

The CHAIRMAN. I thank you, Mr. Drew. And I gave you an extra 

30 seconds because of the obvious wisdom that you were bringing 

to the committee. [Laughter.] 

I have a group of questions which I did not get a chance to ask 

on this round, and we are going to submit it to you in writing. And 

we would appreciate the answers in writing from you in a timely 

fashion. 

We thank you each for coming here today. 

With that, this hearing is adjourned. Thank you. 

[Whereupon, at 3:18 p.m., the committee was adjourned.] 


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