October 22, 2008
OPM ENERGY ASSISTANCE PLANS
By: Kevin E. McCarthy, Principal Analyst
You asked for summaries of the energy assistance funding plans recently submitted by the Office of Policy and Management (OPM) to the legislature pursuant to PA 08-1, August Special Session. After an introduction on the act's requirements, we summarize each plan in turn.
OPM ENERGY ASSISTANCE PLANS
The act establishes three new energy assistance programs for seniors, school districts, and certain non-profit organizations. It appropriates to OPM in FY 09 (1) $4 million to provide home heating assistance to seniors age 65 and older who have incomes at or below 100% of the state median household income and are unable to make timely payments on deliverable fuel, electricity, or natural gas bills; (2) $6.5 million for grants to local and regional school districts for school heating assistance; and (3) $3.5 million to provide heating assistance grants to human service and public health nonprofit organizations, including those that contract with the state to provide services. Funding for all of these programs comes from the FY 08 General Fund surplus.
With regard to the senior program, the act (1) specifies that the state median household income must be determined by using the most recent figures published by the Department of Social Services (DSS), (2) requires OPM to determine eligibility criteria and to pay gas and electric utilities and deliverable fuel dealers directly for the home heating assistance provided, and (3) allows OPM to spend up to $500,000 of the $4 million to identify eligible residents and notify them that the energy assistance is available.
With regard to the school district program, the act requires that grants be calculated on a per-pupil basis.
With regard to the non-profit organization program, the act specifically identifies providers of adult day care, residential services to the homeless, and services to domestic violence victims as potential grantees. It requires OPM to determine eligibility requirements, criteria for determining grant amounts, and application procedures. It allows OPM to consult with various state agencies, chief court administrator, and the Children's Trust Fund Council in coordinating grant payments. It allows OPM to transfer funds to these entities for grant payments. It prohibits any grant award from affecting (1) the calculation of rates or fees paid to the organization receiving the grant or (2) any state contract the organization has to provide services.
Under the act, the OPM secretary must submit a plan for allocating grant allocations for each of the programs to the House speaker and the Senate president pro tempore between October 15 and November 30, 2008. No later than five days after receiving the plan, the leaders must refer it to the Appropriations Committee and to the subject matter committees they determine are appropriate. If the committees vote to approve or modify the plan, the Appropriations Committee, in concurrence with the subject matter committees, must advise the secretary and the governor of their action. The committees must act within 30 days of receiving the plan; if they do not, the plan is considered approved.
If the committees disagree with each other, their chairpersons must form a conference committee consisting of three members, including at least one minority party member, from each committee. The conference committee must report to each committee, which must vote to accept or reject, but cannot amend, the report. If any committee rejects the conference report, the original grant allocation plan is considered approved. If the committees approve the report, the Appropriations Committee must advise the governor and the secretary of their approval.
The act establishes a procedure for further review and approval by the governor and the legislature if the committees modify the plan.
Energy Assistance for Seniors
OPM estimates that there are approximately 231,000 households that may meet the act's age and income standards, of whom approximately 179,000 may be eligible for existing energy assistance programs administered by DSS. The income standard is $48,787 for a one-person household, $63,798 for a two-person household, $78,810 for a three-person household, and so on.
OPM's plan proposes that the program provide a one-time $500 grant for heating expenses incurred between November 1, 2008 and May 15, 2009. (Given the $3.5 million appropriation, this means that the program could serve approximately 7,000 households.) The plan proposes that:
1. grant payments be made for the household's primary source of heat at its primary residence;
2. the program be limited to households who pay their heating costs directly (i.e., renters who pay for their heating costs as part of their rent would be ineligible);
3. the applicant be 65 or older as of November 1, 2008,
4. liquid assets above $7,000 ($10,000 in the case of homeowners) be counted as income for purpose of determining eligibility; and
5. that if the household is eligible for DSS-administered energy assistance programs, it exhaust its benefits under these programs before becoming eligible for the new program.
OPM also proposes that Operation Fuel, Inc., a non-profit organization, administer the program. It notes that Operation Fuel has the administrative and programmatic infrastructure to implement the program, minimizing additional administrative costs. Under the plan, intake would be performed at existing fuel bank locations. The plan specifies how Operation Fuel would conduct outreach programs and pay grants to eligible utilities and deliverable fuel vendors. The plan proposes $500,000 for administrative and outreach expenses.
Energy Assistance for School Districts
The plan gives the legislature two options with regard to this program. In the first, eligibility would be limited to local and regional school districts and those magnet schools run by local and regional school districts. Under the second option, magnet schools operated by other entities and the three public academy schools (Gilbert School, Norwich Free Academy, and Woodstock Academy) would also be eligible. As noted above, the act requires that grants be calculated on a per-pupil basis. Under the first option, the per-pupil allocation would be slightly more than $11.94; under the second, it would be slightly more than $11.63. Under both options, the schools in the state vocational-technical system and those operated by the departments of Correction and Children and Families would be ineligible for the grants.
Energy Assistance for Certain Non-profit Organizations
OPM's consultation with the relevant agencies and entities addressed (1) which organizations would be eligible for the grants, (2) how much each organization would receive, and (3) when to make the payments.
Under the plan, eligibility for the program would be limited to those organizations with whom the state has a purchase of services or fee for service contract for public health services or human services as of July 2008. Each agency and entity developed a list of eligible types of services, which is contained in Appendix B of the plan. These include several dozen services, including Department of Developmental Services (DDS) group homes, Department of Mental Health and Addiction Services (DMHAS) residential treatment services, and Department of Children and Families (DCF) case management services.
The plan proposes to allocate the $3.5 million in funding among seven agencies and the Children's Trust Fund. Each recipient's share of the funding would be proportional to the funds they received in FY 09 for private provider cost of living adjustments. Under this formula, the bulk of the funding would go to DDS ($1.6 million), DCF ($749,000), and DMHAS ($514,500). The recipients would pass this funding on to providers based on their share of the total amount of state contracts awarded to the eligible providers. Thus, a provider with a contract equal to 5% of the total contracts awarded to eligible providers would receive 5% of the agency's allocation. Providers would not have to apply for the grants. Instead, each agency (and the Children's Trust Fund) would identify eligible providers and initiate a payment to the providers as determined by the above formula. OPM estimates that all of the grants would be processed and paid within 30 to 60 days of the legislature's approval of the plan.