Waste Not, Want Not

by Tom Pelham

Federal budget cuts to programs that help Vermonters are inevitable. Both republicans and democrats agree that cuts are necessary to address severe imbalances in the federal budget, but so far disagree on which programs to cut. However, given the inevitability of fewer federal dollars, Vermonters are best served by state officials who respect this new reality and craft forward looking responses that minimize harm to Vermonters.

A recent Times Argus article entitled “Fuel Aid Money on the Block” highlighted President Obama’s proposed reduction in the Low Income Home Energy Assistance Program (LIHEAP). Richard Moffi, Vermont’s Fuel Assistance Program Chief, employed a common refrain and told the reporter, “At that level, you’re going to see some of the state’s most vulnerable residents begin to have to decide between food, medication or heat.”

Mr. Moffi can do better than conjecture that the “state’s most vulnerable” will be victimized by the President’s proposal. Here’s how.

First, a trip to Mr. Moffi’s website http://dcf.vermont.gov/esd/fuel_assistance finds the notices below, which indicate benefits will be lower, not because of the President’s proposed cutbacks, but because eligibility standards were recently relaxed. With more households in the program, benefits will be smaller. Possibly, Mr. Moffi could recommend these recent expansions in eligibility be moderated. The website reads:

 

“Who is eligible?

Two recent program changes mean more Vermont families may be eligible for Fuel Assistance:

  • The monthly income limits have been increased; and
  • The resource test has been eliminated.”

and

“How much help can I get?

As more families participate in the program, the benefits will be smaller. This means that you should plan to pay a bigger portion of your heating costs this coming winter.”

Secondly and more importantly, Mr. Moffi might seek to influence recent events in the many utility related programs scattered across Vermont state government. For example, in 2009 the budget for Efficiency Vermont (EV), funded by electric ratepayers, was $30.7 million. By 2011, fueled by surcharge increases approved by the Public Service Board, EV’s budget grew by $10 million or 33% to $40.7 million. Simultaneously, one of EV’s signature programs, the promotion of CFL light bulbs, was made obsolete as Congress outlawed the sale of the incandescent light bulb. In the recent report Energy Policy Considerations for a New Economy found here http://finance.vermont.gov/sites/finance/files/pdf/state%20budget/tiger_Energy_final.pdf , it’s well documented that EV does not well serve low income households even though low income households pay their surcharge. Certainly given EV’s recent budget increase, it can afford to collaborate with LIHEAP to avoid disadvantaging the “most vulnerable”.

Another path Mr. Moffi might explore is a recent (7/22/2011) program ordered by the Public Service Board upon the request of AARP. This brand new program institutes a “meter charge” on all CVPS and GMP customers to raise $7.8 million. These revenues will be used to subsidize the electric bills of low income households by up to 25%, the very same households Mr. Moffi believes in harm’s way due to the President’s proposal. Possibly Mr. Moffi can get the right hand of LIHEAP to greet the left hand of the new Public Service Board program with the result that these new revenues help address any LIHEAP shortfall. After all, it’s certain that the vast majority of LIHEAP beneficiaries are also hooked up to the electric grid. For state government to cut LIHEAP subsidizes for fuel oil while simultaneously starting a new program to subsidizes electric bills for the very same population of Vermonters would appear quite silly.

Mr. Moffi’s suggestion that President Obama’s proposal can only result in denying benefits for Vermont’s “most vulnerable” implies that the current construct of state government is perfectly efficient. Yet, across state government there are energy, affordable housing, income redistribution, human service, and economic development programs, to name just a few, that operate in silo’s, substantially walled off from one another. By breaking down these walls to better and more flexibly serve customers of state government, sizable savings can be achieved that can be used to serve our most vulnerable as Washington gets its fiscal house in order.

Tom Pelham of Berlin was Finance Commissioner in the Dean Administration, Tax Commissioner in the Douglas Administration and a former state representative, serving on the Appropriations Committee

2 thoughts on “Waste Not, Want Not

  1. Good piece, Tom. Bureaucracies love silos because they are more easily described, rationalized and defended. That’s why’ thinking outside the silo’ makes so much sense and requires strong leadership to stand up to those whose interests are threatened by such creative opportunities for more effective use of limited tax dollars.

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