Clearly, the needs of Maine are very different from the needs of Florida, or even Connecticut. Florida, undoubtedly, is a lot warmer than Maine, but Florida also has about 12 times more low-income households than Maine. Connecticut and Maine both have a lot of cold weather, but Maine is a much more rural State than Connecticut. Even though all three of these states are heavy users of fuel oil for heating, the different circumstances of each state require that they negotiate different pricing arrangements with vendorsnegotiating this type of energy for low-income families requires different approaches. The small, local vendors in Maine, by contrast, are less able to offer discounted prices.
States have wide flexibility to adjust their programs to account for such local differences.
For example, Massachusetts and Connecticut have very sophisticated pricing mechanisms that allow them to pay a fixed rate over the price of fuel oil in the harbor, thus realizing substantial savings for their clients. Minnesota negotiates specific discount rates with each of its fuel vendors. The number of States that receive funds, the amount released, and the distribution among States depends on the nature of the emergency situation. These price increases affected all States, but primarily those in the Northeast that have the largest proportion of fuel oil users. Half of this funding was allocated based on the normal block grant formula and half based on the block grant formula weighted by household use of these three fuels.