Budget allows weatherization increase

May 1, 2001 By    

President Bush’s call for increasing weatherization funding got a boost in Congress as both houses approved fiscal year 2002 budget plans with his request for $1.4 billion for the Low Income Home Energy Assistance Program next year.

Bush didn’t propose a spending increase for the basic program and the House Budget Committee explained that it didn’t approve one because cold weather caused a higher-than-normal demand this past winter. If temperatures return to normal next year, the same money should go further, they reason.

But the budget approved by both houses includes Bush’s request for $1.4 billion over 10 years for the Weatherization Assistance Program, a $120 million increase. The U.S. Department of Energy says it can weatherize 120,000 homes next year with the cash.

Bush also asked Congress for an additional $300 million LIHEAP emergency contingency fund for emergencies such as extreme temperatures, natural disasters or energy price spikes.

The Senate already passed a measure designed to help households deal with recent energy price hikes. The Bankruptcy Abuse Prevention and Consumer Protection Act of 2001 passed with an amendment increasing LIHEAP funding to $3.4 billion, effective this year and running through the following four years. The bill would allow states to increase the state median income level eligible for benefits from 150 percent to 200 percent — but only for the remainder of this fiscal year.

It also would increase weatherization funding from $162 million to $310 million this year and next, rising to $325 million in fiscal year 2003, $400 million in 2004 and $500 million in 2005.

The National Energy Assistance Directors’ Association, which represents state LIHEAP officials, is pressing for the money. It reports that LIHEAP caseloads increased by more than 1 million — 30 percent — over the last winter, from 3.8 million in 1999-2000 to 4.9 million in 2000-01. Without more funds, millions of families could face having their energy shut off, the association warns.

The U.S. Department of Transportation has asked Congress for $21 million – a 10 percent increase – to fund the Hazardous Materials Safety Program that regulates, researches and provides safety programs.

DOT also asked for $14 million for emergency preparedness grants to states to prepare response plans and train emergency response teams dealing with hazardous chemical leaks. The department proposes retaining its $5 million funding level for the Research and Special Programs Administration’s research programs, and bumping by $7 million (to $54 million) money to improve federal pipeline safety efforts. RSPA wants the extra money to deal with new safety standards.

In Brief

Ergonomics not dead yet
Though President Bush signed an order killing the new ergonomics rules, the issue hasn’t gone away. A bipartisan group of senators led by John Breaux (D-LA) introduced legislation that would require the Department of Labor to develop a scaled-down version.

The bill calls for a rule addressing “work-related musculoskeletal disorders and workplace ergonomics hazards” within two years. But unlike the stricken rule, new ones could not deal with injuries occurring outside work, even if aggravated at work.

And Secretary of Labor Elaine Chao issued a statement after that vote: “I am committed to joining with unions, employers, safety professionals and Congress to develop an effective strategy to further reduce (musculoskeletal) injuries.”

Sticker Shock
Consumers considering buying propane-powered equipment may suffer from sticker shock that may drive them to use other fuels.

The Department of Energy released the 2001 average unit cost of propane – about 25 percent higher than the previous year. Manufacturers list the costs on appliances to comply with Federal Trade Commission rules.

The 2001 figures list the representative average unit cost of propane at $11.28 per million Btu – an increase from $8.43 a year ago. In other terms, the new price lists at $1.03 per gallon, an increase from 77 cents.  The figures “may turn people away from propane machines,” warns Eugene Margolis of the department’s Office of General Counsel.

Energy Plan
Senate Democrats have introduced their own energy plan as an alternate to the Republican plan.  The Democrats’ plan, introduced by Sen. Jeff Bingaman (D-NM), focuses more on conservation; the Republicans focused more on production. Yet the proposed benefits for the propane industry don’t vary much in either plan.

“The provision we care most about, the fuel storage incentive, is in the Democrats’ bill,” notes Rick Roldan, chief of the National Propane Gas Association’s Washington office. “We’ve demonstrated broad bipartisan support for that provision, at least on the Senate side.”

Both bills would allow marketers to deduct the value of storage facilities in one year, down from the current seven. Both bills also include a provision allowing a 25-cent per gallon tax deduction.

Bingaman’s bill also would require the Department of Transportation to develop a research program to improve pipeline safety over five years. DOT would get $3 million a year from the Oil Spill Liability Trust Fund for the project.

Heating Help
Businesses hurt by propane price increases got a big step to getting some federal relief when the Senate approved the Small Business and Farm Energy Emergency Relief Act. The bill would provide emergency loans for businesses and farms that can’t pay their bills because of spikes in energy prices – but not for help with indirect costs such as higher inventory or transportation prices.

It would authorize the program for two years and apply retroactively to harm caused by propane price hikes starting last November.

The Congressional Budget Office estimates that the Small Business Administration and U.S. Department of Agriculture would make about 15,000 loans under the program (for all types of energy), totaling about $51 million.

Water Heater Standards
New energy efficiency standards for water heaters and washing machines will go into effect after all.
The Bush administration declared a 60-day delay on implementing standards assigned in the waning days of the Clinton administration, but has since OK’d them. The standards for water heaters will save users of gas-fired units an average of $117 over the life of the product, figuring $12-$13 year in savings. It will take them an average 7.4 years to break even because of higher costs of the equipment.

The Gas Appliance Manufactures Association and the American Gas Association unsuccessfully petitioned the new administration to reconsider the rules.

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