The Congress established the REACH program to minimize the health and safety risks that result from high energy burdens prevent homelessness as a result of inability to pay energy bills, increase the efficiency of energy usage by low-income families, and target energy assistance to individuals who are most in need. The REACH legislation requires that project plans provide a variety of services and benefits, which may include energy efficiency education, residential energy demand management services, counseling related to energy budget management and payment plans, and negotiations with home energy suppliers on behalf of eligible households. The legislation further requires each state’s plan to describe performance goals for its projects and the indicators the state will use to measure whether each project has achieved its performance goals. OCS’ stated purpose for the REACH projects is to demonstrate the long- term cost-effectiveness of supplementing energy assistance payments with nonmonetary benefits that can increase the ability of eligible households to meet energy costs and achieve energy self-sufficiency. REACH is part of a much larger program, LIHEAP, which primarily provides financial assistance to low-income households for home heating and cooling. REACH projects may target their services to a portion of the population eligible for LIHEAP, such as a geographic area or type of client (households with elderly people, for example). Since fiscal year 1996, REACH funding has ranged from $5.5 million to $6.8 million annually, while the total funding for LIHEAP has ranged from $1.2 billion to $2.1 billion. Over the course of the REACH program, its funding has averaged about one-half of 1 percent of total LIHEAP funds. The legislation establishing REACH provided for funding it from LIHEAP’s incentive program for leveraging nonfederal resources. This incentive program provides additional monies to states that, in the previous year, obtained additional assistance for low-income households’ energy needs from such sources as state funds, utility companies, and private charities. The REACH legislation provides that, for each fiscal year, the Secretary of HHS may allocate up to 25 percent of the funding for this incentive program to the REACH program, and HHS has allocated approximately this amount each year since the REACH program was first funded in fiscal year 1996. Through the REACH program, OCS awards grants to states and to tribes, tribal organizations, and insular areas (generally referred to in this report as “tribal organizations”). OCS issues annual requests for grant proposals and then awards grants on a competitive basis. On average, about one-third of the applicants from fiscal year 1996 through fiscal year 2000 received a REACH grant. OCS’ Division of Community Demonstration Programs manages the REACH program. State and tribal organization grants differ in a few ways. OCS has established a 3-year time frame for states to complete their projects, in part to allow time for states to contract with the community-based organizations that carry out the states’ REACH projects. Tribal projects have a 17-month time frame if the tribal organization carries out the project itself, or a 3-year time frame if the tribal organization chooses to use a community-based organization. Unlike states, tribal organizations are not required to conduct evaluations on the effectiveness of their project approaches, but tribal organizations do submit final reports on their projects to OCS. In addition, OCS has established differing maximum grant amounts for state and tribal grants. According to the director of OCS’ Division of Community Demonstration Programs, these caps on grant amounts reflect the differing amounts that states and tribal organizations receive in their LIHEAP allotments and resulted from focus meetings with tribal representatives held by OCS’ LIHEAP staff prior to the first REACH request for grant proposals. OCS’ annual requests for grant proposals, referred to as program announcements, provide criteria for program eligibility, proposals, selection of projects to fund, and states’ evaluations of their projects. Only states and tribal organizations that receive LIHEAP grants are eligible to participate in REACH, and the households that may receive REACH project services are those eligible for LIHEAP assistance. In its program announcements for fiscal years 1996 through 2000, OCS required states’ and tribal organizations’ proposals for REACH grants to address the following elements:the organizational experience and capability of the community-based or tribal organization(s) conducting the project; project staff skills and responsibilities; state-level management and organization of the project; project theory and design, including the target population and needs to be addressed, activities, expected outcomes, goals, and work plan; budget appropriateness and justification; expected beneficial impact; “holistic” strategies addressing the economic and social barriers to self- sufficiency, and project innovations (required for state proposals only); community empowerment of areas characterized by severe poverty, high unemployment, or other indicators of socioeconomic distress (required for state proposals only); and evaluation of the project. OCS uses the above proposal elements in its criteria for selecting which projects to fund. OCS convenes panels to review and score the grant proposals against the criteria; state and tribal organization proposals are assessed separately. Factors in addition to the scoring may be used in making selections, such as geographic distribution and OCS’ past experiences with the applicants. States’ evaluations of their projects are to address how effectively each project was implemented, and whether and why the expected results and goals were or were not achieved. OCS requires states to use third-party evaluators to conduct the evaluations. Such evaluators are individuals or firms that are organizationally distinct from the state agency or community-based organizations involved in the REACH project. Through the end of fiscal year 2000, OCS had awarded $30 million in REACH grants to states and tribal organizations for 54 projects (29 state and 25 tribal projects) to address the home heating and cooling needs of low-income households using a variety of approaches. The most commonly used approaches have been energy efficiency education, home energy audits, home weatherization, and budget counseling, while innovative approaches have included forming consumer cooperatives for energy purchasing and using solar and/or wind power. Several projects have included activities not directly related to home energy—for example, job skill or employment development services and financial assistance toward overdue rent or mortgage payments. After its REACH grant period is over, a state or tribal organization may wish to continue using the approaches tested in the REACH project. Some activities could be replicated in a state’s or tribal organization’s LIHEAP program, if the state or tribal organization chose to do so. OCS has awarded REACH grants for 29 state and 25 tribal projects. Table 1 below shows REACH grant funding and numbers of grants by year and type of grant (state or tribal organization). In addition to the grant funding shown in the table, HHS has provided a total of $1.1 million to states for their costs in administering the grants, overseeing the community-based organizations that carry out REACH projects, and contracting for the third- party evaluations. (Tribal organizations have not received such funding because, to date, the tribal organizations have chosen to carry out their REACH projects themselves and are not required to contract for third- party evaluations.) Including both the grant funding and administrative funding for states, HHS provided $31 million in REACH program funds in fiscal years 1996 through 2000. Tables 2 and 3 below list the grant awards made to states and tribal organizations, respectively, in fiscal years 1996 through 2000. Four states—Michigan, Nebraska, Oregon, and Pennsylvania—have received more than one grant, for separate projects. Similarly, five tribal organizations and one insular area have received more than one grant. State grants ranged in amount from $166,667 to $1.6 million and averaged $931,108. Tribal organization grants ranged in amount from $50,000 to $199,276 and averaged $118,051. The activities conducted under the demonstration grants have varied. Almost all of the REACH projects included multiple activities and addressed more than one of the following areas: reducing energy use for home heating and cooling by increasing efficiency; helping clients pay for energy bills through budget planning, consumer education, consumer cooperatives, and other methods; reducing the use of other utilities (water and electric lighting); and providing social services not directly related to home heating and cooling needs. Appendix I provides further details about the types of activities included in REACH project plans and the number of projects conducting each type of activity. The most common project activity has been energy efficiency education, which was included in 45 of 53 projects. This education has been provided through group workshops for the projects’ clients or through in-home counseling of individual households. Some grantees have also developed energy educational materials, such as pamphlets or videos, some of which were designed for children. Other activities aimed at reducing energy use have included home energy audits and weatherization. Home energy audits were used by 25 REACH projects, often in conjunction with weatherization of the home or education in how to reduce energy use. In a home energy audit, a detailed inspection of the home is carried out to identify repair and weatherization needs and practices of the household that result in inefficient energy use. For example, doors and windows are inspected for drafts, attics for insulation needs, and furnaces for maintenance needs. Families may be advised of energy-saving practices such as turning down their thermostats at night or using fans to reduce the need for air conditioning. Twenty REACH projects have provided home weatherization work by construction contractors. While the Department of Energy’s (DOE) Weatherization Assistance Program helps many low-income families, some homes need repairs that exceed the per-house dollar limit of the DOE program. The REACH projects that included weatherization typically went beyond the services provided by the DOE program or served clients who had not been addressed by the DOE program.