| Releases & Statements
Contact: Frank Sobrino
O: (212) 669-4193 C: (646) 250-4322
For Immediate Release: February 10,
2006
In January 2004, the New York City
Public Advocate’s Office issued a report which found that
the benefit structure designed by New York State for distributing
federal Low Income Home Energy Assistance Program (LIHEAP) funds
to low-income households shortchanges New York City residents.
A review of the current situation reveals that this inequity has
not been addressed and Public Advocate Betsy Gotbaum stands by
the recommendations she made in her prior report.
Every winter, thousands of low-income
New York City residents struggle to stay warm in apartments that
are not properly heated. With limited resources, they are forced
to choose between necessities such as food, medicine, and purchasing
space heaters and the electricity to run them. They risk death
from carbon monoxide poisoning or fire by heating their apartments
with ovens. Yet the New York State Office of Temporary and Disability
Assistance (OTDA) continues to direct the federal funding provided
to help low-income families pay for heat primarily to upstate
households.
New York City is home to 61% of the
state’s population that lives below the poverty level, yet
the Human Resources Administration (HRA) received less than 14%
of the money provided during last year’s heating season
by the federally-funded HEAP program. In fiscal year 2005, New
York State received $235,609,872 in HEAP funding, and distributed
only $32,792,702 to HRA. It’s not that heating assistance
is not needed in New York City; according to the 2005 Mayor’s
Management Report, the Department of Housing Preservation and
Development (HPD) received almost 125,000 heat and hot water complaints
and issued more than 12,800 heat and hot water violations in Fiscal
Year 2005.
When the New York City Rent Guidelines
Board (RGB) establishes allowable rent increases for rent stabilized
apartments, an important factor in its decision is the Price Index
for Operating Costs (PIOC), which is a measure of the change in
costs for operating a rent stabilized apartment building. The
PIOC increased by 5.8% last year and was driven upward primarily
by the 20% increase in fuel costs. Building owners were thus permitted
to raise the rent and pass along the increased cost of fuel to
their tenants, yet low-income tenants did not receive additional
funds to pay the higher rent. While rents have continued to climb
year after year, due in part to the rise in heating costs, the
size of HEAP benefits for tenants has remained essentially flat
and unreasonably low.
Home heating oil costs are expected
to rise another 21% this winter over last, and natural gas costs
are expected to go up by as much as 38%. Despite the spike in
energy costs, Congress elected to approve only $2.1 billion for
heating assistance this year, less than it provided last year.
As a result, the New York State Legislature has recently agreed
to allocate $100 million to make up for the inadequate federal
funding. While these State funds may help meet the needs of homeowners,
they will not increase the benefit amount received by tenants.
When the Rent Guidelines Board sets this year’s rent hikes,
tenants will be sure to feel the impact once again, as high heating
costs are passed along to them.
Primary Recommendations:
• New York State must adjust its HEAP funding formula so
that New York City residents receive an equitable share of federal
heating assistance. OTDA should raise the minimum benefit for
households that pay for heat as a portion of their rent from $40
to $150 per annum, to match the minimum benefit provided to those
who pay for heat directly.
• The Federal Government must provide consistent and adequate
funding for LIHEAP, so that there are funds available, without
State intervention, to ensure all eligible New Yorkers receive
the HEAP benefits they need.
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