Legislative mistake and a court decision put low-income heating fund in jeopardy

Dec 8, 2011

Michigan lawmakers are debating this week how to help low-income families pay their heating bills. It’s turned into an urgent problem because of federal budget cuts... and a court decision that has tied up millions of dollars. Here’s how it works: there’s a program called the Low-Income Energy Efficiency Fund. If you get your power from DTE or Consumers Energy, you pay into that fund when you pay your energy bills... somewhere between one and two dollars a month. There’s been about $90 million dollars in that fund annually. About $60 million of that goes to help low-income families keep their heat on in the winter. The other $30 million goes toward energy efficiency projects (often to help low-income families weatherize their homes to save energy and money). But... this summer, a court decision changed everything. State Representative Jeff Irwin (D-Ann Arbor) says some of the industries that also have to pay into this home heating fund sued the state. They said that the Michigan Legislature made an error in 2008... and left out language that authorizes the Michigan Public Service Commission to collect this money. “So they brought that suit forward and they won. It turns out, in 2008 the Legislature did leave out some key language. So now you’ve got thousands of families across Michigan facing the loss of heating assistance this winter. And also you have a number of energy efficiency and renewable energy projects across the state in various stages of completion that are also left in the lurch.” Irwin says lawmakers could have put the program back together, but they haven’t. When that court decision came down... the Michigan Public Service Commission canceled the grants it had awarded for energy efficiency projects. Sean Reed is with the Clean Energy Coalition. It’s a non-profit group that was using the low-income funds to help cities in bad financial shape upgrade their energy systems... cities like Detroit, Flint and Benton Harbor. “In some of them they don’t have functioning heating or air conditioning systems in the city hall facilities, which if you’re a municipal employee and you’re trying to get things done, you’re wearing your coat and your hat all day just to stay warm.” Reed says they have a number of projects that were stopped midstream. The Legislature is talking about how to fulfill those contracts. But some Republicans say there’s a bigger problem with the low-income heating fund. Representative Ken Horn (R-Frankenmuth) says low-income heating money should not be used for energy efficiency projects. “And that money was going towards wind energy projects for the Great Lakes, solar panels sitting in warehouses that need to be installed yet, cities are changing out their traffic lights from incandescent to LED.” Michigan lawmakers say they’ll find a way to pay for heating assistance before they go on their winter break next week. But it’s not clear what will happen with the money for energy upgrades.