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Low-Income Minnesota Residents Struggle to Meet Heating Costs

Posted on: Wednesday, 12 October 2005, 12:00 CDT

By Tim Huber, Pioneer Press, St. Paul, Minn.

Oct. 12--Lucille Olson has no idea how she'll pay her heating bills this winter.

The 75-year-old St. Paul resident couldn't get federal heating assistance last year because her income was too high. Olson applied again this year, but doubts she's eligible, even though most of the $2,100 a month she and her husband receive from pension and Social Security checks is consumed by medical bills and health insurance costs.

"Right now my bank account is zero," Olson said. Yet her latest bill from Xcel Energy was for $450.10 -- well above the $150 a month she budgeted.

Olson is hardly alone. More than 100,000 Minnesota families receive money from the Low-Income Heating Assistance Program every year, but more than 300,000 more families qualify for the funds and fall through the cracks because they don't apply for help.

No one knows for certain how many more, like Olson, make too much money to qualify but still can't keep up with their heating bills.

And that's just figuring on average winter fuel costs. This winter, costs are shaping up to be far worse: Prices of natural gas, propane and heating oil have risen high enough that the typical Minnesota family's bill this winter could jump 40 percent -- to more than $1,000 -- according to the latest estimates. A colder-than-usual winter could mean bigger problems.

The cost increase is expected to put even more stress on the state's already stretched safety net, and people who deal with the poor day in and day out sense that Minnesota is heading for a crisis.

"It's going to be an exceedingly tough winter," said Scott Zemke, operations director at Community Action Partnership of Suburban Hennepin County, where applications for assistance have spiked.

Calls to the Salvation Army's HeatShare assistance program are up 65 percent in the past month, and the story is the same at agencies that distribute state low-income heating assistance program funds for the state.

Last winter, Minnesota distributed nearly $85.9 million in federal heating assistance money to more than 117,600 households, but higher fuel prices combined with even a modest increases in applications for aid could make that amount of funding a drop in the bucket this year.

Minnesota has not yet been told how much money it will receive for the program this year, though Congress is being pushed to increase funding nationwide to $4 billion. Last year, the states received $2.5 billion.

The way Pam Marshall, executive director of the St. Paul-based Energy Cents Coalition, sees it, Minnesota could need an additional $121 million this winter given current energy prices and a 5 percent increase in applications. Marshall believes the state should step in with additional money. "This requires a special session," she said.

Regardless of how much money Minnesota receives, the numbers say hundreds of thousands of Minnesotans fall through the cracks. The Low-Income Heating Assistance Program typically serves about 28 percent of eligible households in Minnesota, which means that better than 300,000 families don't receive help, Marshall said.

Even the assistance that is doled out this winter isn't expected to go terribly far. Grants have ranged between $408 and $445 in the previous four years, but a 40 percent increase in heating costs would push the typical Minnesota household's bill above $1,074 this year.

And then there's people like Olson, who weren't eligible for assistance last year. No one knows for sure how many Minnesotans are facing that situation, but numbers from suburban Hennepin County and Ramsey and Washington counties suggest there are thousands. Community Action Partnership of Suburban Hennepin County rejected 6 percent of applicants, or 480, last year because their incomes were too high. Community Action Partnership for Ramsey and Washington Counties rejected 625, said energy assistance manager Catherine Fair.

"The people who are a little bit over the income guideline, we would not consider them as middle income," Fair said. Instead, most live in poverty despite seemingly decent incomes. Many are senior citizens living on fixed incomes and have big prescription drug costs and medical bills.

Olson said the bulk of her family income goes toward supplemental Medicare insurance and everyday expenses, such as gasoline for her car to drive to the nursing home where her husband, Kenny, is living. Kenny, a retired truck driver, receives a $775 pension from the Teamsters and the couple receives another $1,325 from Social Security. Yet Olson has been forced to go to food banks and is hoping that Xcel Energy accepts the $150 she sent in on her latest bill.

"My husband worked hard all of his life, and I worked hard too," she said. "I don't think it's a fair thing that we can't afford to heat our house."

Olson already has taken what experts say is an important first step: calling her utility. Minnesota's so-called cold weather rule bars utilities from disconnecting low-income customers between Oct. 15 and April 15 -- if they agree to payment plans. Xcel generally extends that protection to all customers who make arrangements.

"Our objective is really just continue the service," said Pat Boland, Xcel's supervisor of personal accounts.

Xcel on Tuesday donated $1 million to Salvation Army's HeatShare program, aimed at providing emergency heating assistance for people like Olson.

The utility is donating a total of $5.2 million to heating assistance, with the bulk of the money going to Minnesota and Colorado, its major states of operation, and the rest being distributed to places where it has smaller operations. "We had to do something," said Xcel Chief Executive Richard Kelly.

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Copyright (c) 2005, Pioneer Press, St. Paul, Minn.

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Source: Saint Paul Pioneer Press (St. Paul, Minn.)

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