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VT Approves $6 Million for FY 2014 Heating Help

May 17, 2013 — Following an eventful legislative journey, Vermont Governor Peter Shumlin's request for funding to supplement LIHEAP made it into the budget adopted for Fiscal Year 2014. The legislature approved $6 million, which was the amount the governor requested in his initial budget.

When he unveiled his budget in January, Shumlin proposed raising $17 million by charging a 10 percent tax on "break open" tickets. The tickets are sold at bars and social clubs to raise money for a range of charities in Vermont. Citing a similar tax in Connecticut and Massachusetts, the governor said this new funding stream would go towards low-income heating assistance, weatherization, and renewable energy.

The governor touted his proposal for energy assistance as the "first-ever base budget contribution to LIHEAP" by the state. "Let's recognize the sad fact that Washington is unlikely to fund this critical program adequately," said Shumlin, "and let's do something about it." He said $6 million from the tax would go towards LIHEAP.

Likely, the governor was trying to avoid crises arising from funding in previous years for energy assistance. In October 2012, the Vermont Emergency Board approved $8.8 million to supplement LIHEAP funding. The dollars came from the Weatherization Trust Fund, the Vermont Department of Corrections, and monies allocated to cover federal spending cuts. Another indication of the need for supplemental funding came in February. The governor announced the state's crisis heating program needed an additional $900,000 or it would close March 1, a full month before its scheduled end.

Shumlin's tax proposal immediately came under fire. The Legislative Fiscal Office released a report stating that the tax on "break open" tickets would only generate about $6.5 million. Some lawmakers expressed skepticism it would raise even that much. Other legislators worried the tax would hinder fundraising efforts by charitable organizations.

Following the Fiscal Office report, the Senate Appropriations Committee announced it would move forward with the $6.5 million estimate instead of Shumlin's $17 million. The committee would later reject the option all together. However, while working on the budget, the committee increased supplemental LIHEAP funding to $7.9 million, in order to make the annual heating-assistance benefit in 2014 about $900 per household.

Over in the House, the Natural Resources and Energy Committee cut the $6 million for LIHEAP in early March. The chairman announced his committee was going to let House Appropriations decide the fate of the funding. The House Appropriations Committee ultimately decided to re-insert the $6 million for LIHEAP.

In mid-May, the legislature finalized the budget, including $6 million for energy assistance, after 10 days of negotiations between House and Senate leaders. Following an agreement reached with the governor in early May, the two chambers had to reconcile their competing budget bills and find $10 million in savings to avoid raising any additional taxes. The Senate had appropriated $7.9 million to supplement LIHEAP, while the House had approved $6 million. The Senate agreed to adopt the House figure and put the $1.9 million towards the total savings the chambers needed.

Sources: Media reports