Betty Nordstrom has been worried since she received her energy assistance notice about two weeks ago.
“They said my amount was $554 for heating oil,” she said. “That’s such a low amount when heating oil is $5.19 a gallon.”
This year’s Energy Assistance Grant paid about 100 gallons of fuel, far less than the 500 gallons needed to heat her century-old home during a typical winter.
Nordstrom, 71, lives in the northern woods about 20 miles east of Detroit Lakes, Minnesota. She has diabetes and is in a wheelchair. She gets by on social security benefits.
“It only goes so far. I don’t know what I’m going to do after Christmas this winter. Because that’s how long the heating oil lasts until Christmas,” she said.
Before the pandemic, Nordstrom would have paid $2.50 to $2.90 a gallon for heating oil, according to the Federal Energy Information Agency.
“Hear Worries Every Day”
Nordstrom receives its energy support from the MAHUBE OTWA Community Action Agency, which serves five counties in northern Minnesota.
The agency is hearing from many people who have been surprised by the much lower energy aid grants this year.
“We hear concerns every day, staff here are taking phone calls, people have been sending letters asking for a reset. We’re definitely seeing some frustration with the level of funding,” said Dan Josephson, Director of Energy Programs at MAHUBE OTWA.
Josephson said the average home heating subsidy so far this year is $580. Last year the average was $1,199.
This discrepancy is similar across the country.
“The funding is about half what it was; it’s actually less than half what it was last year. That’s why people are seeing a reduction in those benefits,” said Michael Schmitz, program director for energy assistance at the Minnesota Department of Commerce.
“In the pre-COVID era, we typically received around $116 million in energy assistance every year,” he said. “Under the American Rescue Plan Act, we received an additional $167 million in addition to the annual $116 million that we receive. So we had more than a doubling of funding for last year’s heating season.”
This extra money enabled the state to provide larger individual heating allowances.
The agency also used the cash inflow to pay overdue heating bills for thousands of low-income Minnesotans.
The distribution formula takes into account income, the type of fuel used and other factors.
But the recipe must also be adapted to demand.
125,000 requests for help expected
“Our goal is to neither go out nor leave money on the table,” said Schmitz.
He expects around 125,000 applications for energy subsidies this year.
“Probably in a typical year there is more need than funding is available. We serve between 20% and 25% of the estimated eligible population in the state of Minnesota,” said Schmitz. “So if you take a step back and look at household income census data, we estimate that there are over 500,000 households in the state that could be eligible for programs like energy assistance.”
Schmitz said federal energy aid funding has been static for the past decade, with the exception of last year’s large pandemic-related infusion.
He said the state received $19.7 million in additional federal funding this fall and he hopes Congress will allocate more funding in response to inflated heating bills.
Extra dollars are used for crisis funding when people run out of fuel and have no other options.
Bill Grant is Executive Director of Minnesota’s Community Action Partnership, which represents statewide agencies that distribute much of the energy assistance programs.
“I urge people to apply, even if they feel the grant amount may not be fully enough,” he said. “Because if that made more money available, they might be lining up for extra help.”
Grant said the impact of rising fuel costs is being felt more in rural areas where natural gas is not an option for heating homes.
“With fuel prices higher than before, this will cause problems, especially for people with supplied fuels like propane or heating oil. [because] Typically, these utilities require an upfront payment for a fill,” he said.
Betty Nordstrom ponders where to find the money to fill up her heating oil tank before it’s empty and doesn’t see many options.
“Maybe God will send help,” she said.