State Solutions to Consumer Needs

1. State Solutions to Consumer Needs Dalitso S. Sulamoyo, Ph.D Illinois Association of Community Action Agencies

2. What is IACAA? IACAA is an umbrella organization that represents non-governmental and local governmental organizations that were established for the purpose of fighting poverty in their communities.

3. Utility Assistance

4. Utility Bills and Low Income Customers Introduction • Low income customers often pay between 20-30% of their income on home energy bills; Average customer pays between 4-6%

5. Illinois’ Utility Assistance Programs Services Offered • Illinois Home Energy Assistance Program • Percentage of Income Payment Plan • Rate Relief Programs

6. LIHEAP Designed to help low income households with immediate utility needs • The Illinois Low Income Home Energy Assistance Program (LIHEAP) is designed to assist eligible low income households pay for winter and summer energy services.

7. LIHEAP Eligibility Levels • Serves customers at or below 150% of poverty • Family of 1 – $17,505 • Family of 2 - $23,595 • Family of 3 - $29,685 • Family of 4 - $35,775

8. LIHEAP Funding Federal • LIHEAP Block Grant administered by the Department of Commerce and Economic Opportunity. In 2013 the LIHEAP funding was $158 million.

9. LIHEAP Funding State Supplemental • Enacted in Illinois in 1997 • Funded by a rate payer meter charge • Designated to provide additional funds for LIHEAP and Weatherization Programs • About $68 million designated for LIHEAP • About $9 million designated for Weatherization

10. LIHEAP Service Delivery Design Functions and Roles • Illinois Department of Commerce and Economic Opportunity administers the block grant. • Community Action Agencies perform outreach and intake. • Community Action Agencies work with utilities to apply credits.

11. LIHEAP Service Delivery Design Priority Periods • September 1 – persons with disabilities and senior citizens can apply for services • October 1 – Households with children under the ages of 5 can apply • November 1 – Open enrollment period for the general public

12. LIHEAP Service Delivery Design Winter Utility Assistance • LIHEAP assists with a once a year winter benefit payment – roughly $400-$500 • Reconnection Assistance offered for customers who are disconnected • Furnace Assistance – repair or replacement

13. LIHEAP Service Delivery Design Summer Utility Assistance • LIHEAP also assists with a once a year summer benefit payment – $150 • Targets seniors and persons with disabilities

14. PERCENTAGE OF INCOME PAYMENT PLAN (PIPP) • What is A Percentage of Income Payment Plan (PIPP)? • Under the PIPP, participants pay no more than 6% of their income for gas and electric service. They also receive a monthly benefit towards their utility bill and a reduction in overdue payments for every on-time payment they make by the bill due date. • Program is funded with state funding only

15. PIPP Eligibility Levels • 150% of Poverty • All electric or Gas/Electric Combination • Service must be connected • PIPP Participating Utilities Only

16. PIPP Benefits and Obligations • Customer Obligations • Customers must make on-time monthly bill payments or they can be removed from the program after 2 missed payments • Minimum Payment of $10 or 6% of income • Agency • Utilities determine budget billing based on customer monthly averages • Agencies pay the difference between customer payment (6% or $10) and the determined budget bill with state LIHEAP funds up to $1,800/year. • Customer Benefits • If the customer makes on-time payments they will receive a larger benefit than traditional program • If a customer makes on-time payments they will have a portion of their arrearage paid off for them

17. PIPP Service Delivery Design Functions and Roles • Illinois Department of Commerce and Economic Opportunity administers the block grant. • Community Action Agencies perform outreach and intake. • Community Action Agencies work with utilities to apply credits. • Client Intervention • Utilities communicate missed payments to agencies • Agency must make 2 contacts with customer after a missed payment

18. PIPP Service Delivery Design Priority Periods • Program applications are taken September 1 – December 31 • Recertification takes place June - August

19. PIPP Service Delivery Design Benefits • Customers Pay 6% of Income • Maximum Benefit of $150/month or $1,800/year • Arrearage Reduction Potential • Budget Bill

20. Sample Bill – PIPP Customer Benefits

21. PIPP Service Delivery Design Arrearage Reduction Plan • Arrearage Reduction Plan • Statute on the PIPP has an additional meter charge for arrearages. • Participating utilities assess $.08/month on their customers. • Funds are collected by the utilities and they credit their customers’ arrearages • If customers make regular on time payments their arrearages are reduced or eliminated by 1/12 monthly with a cap of $1000 per customer

22. 2013 State-Wide Energy Assistance Results Regular LIHEAP - 384,069 households PIPP – 60,522 households Furnace Assistance - 1,818 households Summer Cooling – 74,280 households

23. Rate Relief Programs • Background of Rate Relief Program • In 2007 a 10 year rate freeze was lifted on Illinois electric utilities • This resulted in significant rate increases on electric utility customers • Commonwealth Edison (ComEd) and Ameren Illinois approached IACAA to operate an assistance program for households in poverty • Program Qualifications • Customers at 0-400% of poverty who could demonstrate a financial hardship were eligible for additional assistance (ComEd program is now 0-250% of poverty : Family of 4 - $58,875) • IACAA’s Role • Distribute funds to agencies and collect reports

24. Rate Relief Results Operated from 2007-2010; Distributed almost $15 million dollars to customers approximately 25,000 customers received an average $600 each 2007 – present; Distributed roughly $30 million to customers. Over 70,000 customers served

25. Q and A?