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Bills and Rates

Five federal sources of support for paying utility bills

The devastation the COVID-19 pandemic has wrought, both physically and economically, will be with us long after most Americans get vaccinated and the death toll and hospitalizations subside. While public power’s immediate concern has been the safety of our workers and customers, looking ahead, public power must also address concerns about the millions of Americans falling further and further behind on their utility bills.

Over the past year, Congress has enacted a number of new programs and beefed up existing ones that can help. There are five programs public power utilities can point customers to, with some restrictions and stipulations to be mindful of for each.

One of the most well-known resources is the Low Income Home Energy Assistance Program. Early in 2020, as part of the Coronavirus Aid, Relief, and Economic Security, or CARES, Act, Congress appropriated $900 million for LIHEAP in addition to the $3.74 billion already appropriated for the year. In December, Congress appropriated another $3.75 billion for fiscal year 2021. One of the challenges for LIHEAP has been getting customers to seek out assistance, and the National Energy Assistance Directors’ Association suggests that public power utilities work with their local community action agency to identify likely eligible households and conduct targeted outreach to those households. The American Public Power Association is also working with Congress to secure additional funding so that LIHEAP will have the resources needed when more families do seek assistance.

Also included in the CARES Act was a $150 billion Coronavirus Relief Fund to be distributed to states and local governments. One of the approved uses is economic assistance for COVID-19-related hardships, including the inability to pay utility bills. APPA secured guidance from the Department of the Treasury outlining that public power utility customers could benefit from CRF-funded utility assistance programs. While most CRF funds are spoken for at this point, Congress is likely to consider giving the program another cash infusion this year.

The CARES Act also made available $5 billion in supplemental Community Development Block Grant coronavirus grants. One use for these grants is emergency payments for residents, including for utilities. Many public power customers are benefiting from several such programs established throughout the country. However, an underlying CDBG rule has the Department of Housing and Urban Development taking the position that a public power utility customer cannot benefit from such a program unless the customer’s public power utility is clearly distinct — or at least has separate finances — from the granting city or county. APPA is working to resolve this issue.

Congress has also taken steps to help cash-strapped small businesses by creating the Paycheck Protection Program. Congress has appropriated nearly $1 trillion for the program. While forgivable PPP loans are primarily intended to be spent on wages, up to 40% can go to fixed costs, including mortgages, rent, and utility payments. The hurdle for public power here is making sure that small business customers are aware of the program and use the proceeds to pay their utility bills.

Finally, a new program approved by Congress could also help public power utility customers. The Consolidated Appropriations Act created a $25 billion Emergency Rental Assistance program, the proceeds of which are intended to be used for rent and utility assistance to residential customers who rent their homes. The Treasury Department is distributing these funds to states and to requesting cities and counties with a population of more than 200,000. It is likely that the bulk of funding will go to rent, not energy, needs. However, APPA has strongly encouraged its members to reach out to eligible cities and counties and to state LIHEAP and housing agencies with the best estimate of the number of renters in their service territory who are behind on energy bills. We also suggest that utilities identify a list of renters who are behind and inform these customers that funding is available and provide them with information on how to access applications and who to contact at local agencies to sign up for help.

None of these is a silver bullet that will solve all their problems, but each of these solutions can offer some relief to public power customers. By helping our customers most in need, we can help our communities as a whole recover and move forward.

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