Special Subcommittee on Energy


Minutes of the<MeetNo1> 1st Meeting

of the 2016 Interim


<MeetMDY1> June 17, 2016


Call to Order and Roll Call

The<MeetNo2> 1st meeting of the Special Subcommittee on Energy was held on<Day> Friday,<MeetMDY2> June 17, 2016, at<MeetTime> 10:00 AM, in<Room> Room 131 of the Capitol Annex. Senator Jared Carpenter, Chair, called the meeting to order, and the secretary called the roll.


Present were:


Members:<Members> Senator Jared Carpenter, Co-Chair; Senators Ernie Harris, Dorsey Ridley, Brandon Smith, and Robin L. Webb; Representatives Rocky Adkins, Hubert Collins, Tim Couch, Will Coursey, Jim Gooch Jr., Jerry T. Miller, Sannie Overly, Tom Riner, John Short, Kevin Sinnette, Fitz Steele, and Jeff Taylor.


Guests: Elizabeth Caywood, Internal Policy Analyst IV, Office of the Commissioner, Department for Community Based Services, Cabinet for Health and Family Services; Todd Trapp, Branch Manager, Policy Development Branch, Division of Family Support, Department for Community Based Services, Cabinet for Health and Family Services, Roger McCann, Executive Director, Community Action Kentucky and Cathy Hinko, Metropolitan Housing Coalition.


LRC Staff: D. Todd Littlefield, Stefan Kasacavage, and Susan Spoonamore, Committee Assistant.


Presentation and Public Hearing on the Low Income Home Energy Assistance Program (LIHEAP) Block Grant Application – FY 17

Elizabeth Caywood, Internal Policy Analyst IV, Office of the Commissioner, Department for Community Based Services (DCBS), Cabinet for Health and Family Service, Todd Trapp, Policy Development Branch, Division of Family Support, Department for Community Based Services, Cabinet for Health and Family Services and Roger McCann, Executive Director, Community Action Kentucky.


Ms. Caywood gave an overview of the Low Income Home Energy Assistance Program (LIHEAP) Block Grant Application. She explained that LIHEAP offers assistance for low-income individuals and family a safety net for their heating and cooling costs and energy conservation measures. Most of the low-income households pay the highest proportion of their income for home energy. Community Action Agencies are the designated agencies to distribute the federal funds for LIHEAP. The program is 100 percent federally funded with no state match requirement. It is anticipated for FY 2017, the award will be approximately $30 million of which ninety percent is used for direct benefits to Kentucky citizens. The DCBS contracts with Community Action of Kentucky, Inc. (CAK) to provide administrative training, monitoring and technical support through subcontracts with the twenty-three agencies of Kentucky’s Community Action Network. She said that $25,000 is retained by DCBS for preventative assistance to provide families with an energy payment if the payment will prevent the removal of a child from the home or assist in returning a child to their home. Approximately $30,000 is available to design and initiate leveraging activities to help increase the resources available to eligible households to reduce their residential energy costs for consumption. The Cabinet for Health and Family Services (CHFS) plans to transfer exactly fifteen percent of the LIHEAP allocation to the Kentucky Housing Corporation (KHC) for the weatherization program. Community Action agencies retain a small percentage of their individual allocations to provide budget counseling, assist with energy vendors and develop utility plans to promote the self-sufficiency of the household served. Ms. Caywood said that ten percent of the award that is left is used for combined administrative activities and that includes the DCBS and federal contract monitoring, CAK, and KHC.


Todd Trapp explained that LIHEAP serves households whose incomes are at or below 130 percent of the federal poverty level. For a household of one, the monthly income cannot exceed $1,287 or for a household of four, the income cannot exceed $2,633 per month. There are two types of payment assistance benefits, the subsidy component and the crisis component. Benefits are available in all of Kentucky’s 120 counties through their Community Action Agency. From November 2015 through April 2016, the weatherization program served 894 homes.


Roger McCann, Executive Director, Community Action Kentucky, Frankfort. Mr. McCann said that CAK represents twenty-three community action agencies across the state. Each agency is operated by a board of local elected officials and representatives from the low-income in that area. The intent of the programs is to provide stability to the vulnerable families and to help reduce the effects of poverty. In order to get out of poverty a person needs to have a job, so CAK assists in getting them job training so they can become self-sufficient. Mr. McCann noted that 81,941 households across the state received a subsidy benefit for a total of $11,339 million. He said the crisis component was extended through the end of April because of surplus funds. The number of households receiving crisis benefits was 79,216 which totaled $23,617 million in benefits. The weatherization program is handled by the Kentucky Housing Corporation who provides allocations to the different Community Action agencies.


Chairman Carpenter agreed that people who have to spend a disproportionate share of their income on utilities will forego other necessities such as medications and food.


Cathy Hinko, Metropolitan Housing Coalition, which is a research policy analysis and advocacy organization focused on fair and affordable housing. Ms. Hinko stated that she spoke to the committee last year with concerns about LIHEAP and the way it was being unfairly administered for areas like Louisville whose utilities are metered. This year Louisville returned $500,000 unspent crisis money. Last year Louisville returned approximately $300,000. There are concerns that the returned money may violate Title VI of the Civil Rights Act of 1964. In part, she stated that public funds may not be spent in any fashion which encourages, entrenches, subsidizes or results in racial (color or national origin) discrimination. Ms. Hinko said that the poverty rate in Louisville for African Americans is thirty percent and the poverty rate for white families is eleven percent. Ms. Hinko asked that the Special Subcommittee on Energy recommend a quarterly report from the cabinet on their progress to achieve parity and their progress on redesigning the program so that it is fair. As a final note, she was told that there would not be a cooling program this year.


In regards to the cooling component, Ms. Caywood said that there are no funds for this year.


In response to Rep. Miller’s question about returning unused crisis funds, Mr. McCann said the program is operated on reimbursement. Any funds that are unrequested remain in the pot. The unspent money will be used toward next year’s funding of the subsidy component. Mr. Trapp stated that there is a limit on what can be carried forward from one federal fiscal year to another fiscal year. The money needs to be spent in the given fiscal year because the cabinet is limited to carrying forward ten percent.


In response to Representative Overly, Ms. Caywood said that the cabinet would be happy to provide staff with quarterly updates.


In response to Representative Taylor, Ms. Caywood said that the cabinet is reaching out to other states on how to improve the waiting time for funding. There are some bulk fuel vendors who do go out and they can provide a limited quality assurance measure for the cabinet.


The Proposed Findings of Fact were adopted, by unanimous voice vote, upon motion by Representative Collins and second by Senator Ridley. (A copy of the Findings of Fact can be found in the committee’s meeting folder in the LRC Library.


There being no further business, the meeting was adjourned.