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Home Energy Bill Obligation / Housing Type

In order to be eligible for LIHEAP, most grantees require that an applicant household prove it has an obligation or responsibility to pay its home energy bill, sometimes referred to as having an energy burden. Such obligation is reflected through an active account with a utility or fuel vendor, a current energy bill, and evidence that the household pays the vendor directly.

Most grantees equate this obligation to the household's "vulnerability" to increasing home energy costs, and they consider households that are vulnerable to such costs, especially those that pay their vendors directly, as eligible for LIHEAP.

On the other hand, households with no home energy bill obligation are considered not vulnerable to home energy cost increases and, therefore, ineligible for LIHEAP. Or they may be considered less vulnerable than those who pay for energy bills directly.

Section D of the Tribal Manual provides the following scenarios for consideration when it comes to vulnerability:

  • A household who pays its energy bill directly to a home energy vendor is considered fully vulnerable to the rising cost of home energy and would receive a full LIHEAP benefit.
  • A household who pays for energy through its rent payment is fully vulnerable if the rent is increased due to the rising cost of home energy and would also receive a full LIHEAP benefit.
  • Two separate households living in one house and sharing the costs of the heating bill may each be considered only partially vulnerable and each household would receive ½ the benefit amount. Or, a tribe may consider the household who is named on the bill as fully vulnerable and the other household would not be considered vulnerable or eligible for benefits.

The manual notes that tribes may find various living arrangements similar to the one described above. It is important that the tribe determine in its LIHEAP policy how different types of living arrangement will be handled. It is also important that policies used to determine vulnerability and eligibility are used consistently throughout the program year.

Subsidized Housing

Under Assurance 8, grantees must treat owners and renters equitably. According to Division of Energy Assistance guidance:

"In this section of the law, 'equitably' does not necessarily mean 'equally.' The description in your plan may tell HHS that renters and owners will be treated equally or differently. The problem will be to deal with every household so that the effect of LIHEAP is equitable for all of them. Equitable means fair, given all of the factors that come into play.... One important thing to consider is how responsible the household is for payment of its own energy bills? Is the household vulnerable to or responsible for the cost of heating and cooling?"

Another federal law governs how grantees must handle subsidized housing renters who receive a utility allowance to help pay their energy bills.

This law (Section 927 of the Housing and Community Development Reauthorization Act of 1992) says that subsidized housing households that pay energy bills directly to their energy vendor and who receive federal assistance through utility allowances cannot be excluded from LIHEAP. However, in determining the household's benefit, a state may take into account the amount of the energy allowance provided to the household and reduce the LIHEAP benefit accordingly.

Section D of the Tribal Manual states the following regarding subsidized housing:

"The law states that residents of HUD housing who pay energy bills directly to the home energy vendor and who receive federal assistance through utility allowances cannot be excluded from LIHEAP. This means that even when a HUD renter is receiving an allowance to pay his utility bills and pays the vendor directly, a tribe cannot refuse to provide him a LIHEAP benefit if he is otherwise eligible for LIHEAP. However, in determining the amount of the household's benefit, tribes may take into account the amount of the energy allowance provided to the household and reduce the LIHEAP benefit accordingly.

This law deals only with residents in HUD housing who pay their energy bills directly to energy vendors. The law does not address those households who pay for their home energy through their rent payment. The tribe should be careful, though, in reducing the benefits to HUD residents who pay for their heating costs in their rent payments, since there have been conflicting court decisions concerning the reduction or elimination of LIHEAP benefits to this type of HUD resident."

More background on subsidized housing and LIHEAP is available here.