Utility assistance demand is high in Iowa as inflation pressure meets cold weather

CEDAR RAPIDS — Cold temperatures and snow have already made their way to Iowa this month, and local and state organizations know the demand for utility assistance will be high as a cold winter meets inflation pressure.

Across the United States, many households are set to spend the most they have in the last 25 years on heating costs.

The expenditures forecast is the result of higher fuel prices combined with higher heating demand due to predicted colder weather this winter, according to the U.S. Energy Information Administration’s annual winter fuels outlook. Russia’s invasion of Ukraine has made the market even tighter.

U.S. households could face an average power bill of $1,359 for this winter, the highest since at least 1997, according to the administration’s data.

J’Nae Peterman, Waypoint’s director of housing services, said Linn County, like the rest of the country, is seeing a housing crisis.

“The majority of our community — renters or homeowners — are struggling,” Peterman said. “Staying current on bills is a struggle, especially during the holiday season. People are trying their best to do things with their families for holidays so people risk sacrificing making a payment. This winter, it’s going to be tough for families to maintain their budgets.”

Waypoint doesn’t directly provide utility assistance, but it does connect clients to other organizations — like the Hawkeye Area Community Action Program, or HACAP — that do. However, Waypoint knows the need is there for utility assistance based on the number of people in its housing services program, which connects individuals to a housing resource or helps find additional employment. Waypoint serves Linn, Benton and Jones counties.

“We went from serving 3,000 to 13,000 in our housing services program in the last two years,” Peterman said.

HACAP, which serves Benton, Dubuque, Delaware, Iowa, Jackson, Johnson, Jones, Linn and Washington counties, does provide direct utility assistance. The number of households seeking assistance has increased in recent years.

In 2020, 7,781 households applied for the energy assistance program. Last year, that number was 11,922. So far this year — as of early November — almost 4,000 households had applied. Last winter, HACAP provided $11 million in energy assistance in Eastern Iowa.

The energy assistance program is designed to help low-income families meet the cost of home heating and pays a portion of residential heating costs for eligible households. In most cases, benefits come in the form of a credit applied to the utility company’s heating bill.

Individuals needing assistance can apply directly at HACAP’s website at hacap.org/energyconservation. There are also paper applications available.

“The pandemic was really a time marker for a lot of things and all of our services have seen an increased need all around,” said Chris Ackman, the communications and volunteer manager for the organization. “Now we have the inflation issue. The moral of the story is: it hasn’t gotten easier for lower-income families. It’s only gotten harder or, at best, continued to be difficult.”

Energy assistance is also available at the state and federal levels through the Iowa Department of Human Rights. Bill Marquess, the energy assistance bureau chief, said his department is anticipating a heightened need this winter.

“We’re looking at another rough winter,” Marquess said. “It’s going to be an expensive one.”

The Low-Income Home Energy Assistance Program is a federally-funded program that provides a one-time payment to the heating utility and is distributed at the state level. Applying to the program also grants a moratorium protection to the applicant, preventing a utility disconnection during the winter.

Marquess said that so far this year, the need is on par with last year, when about 80,000 households in Iowa were assisted.

“I think inflation has been a huge factor in this. Households are having to be more judicious where they are putting their limited income. They’re having to choose between buying food and medicine and there’s not enough to go around,” Marquess said. “We’re still seeing the impact from the pandemic as well and climate change is a reality, too. We go from summer, straight to winter without much of a fall and that’s impacting the time frame.”

The department's normal funding to help with energy assistance is typically around $55 million. However, for the last two years it had American Rescue Plan Act funding of $78 million, which allowed the department to provide supplemental payments to everyone who received assistance. It also increased the crisis limits for furnace repairs.

This year, the department has about $50 million, plus about $1 million from the bipartisan infrastructure law, and about $9 million from the Emergency Security Supplemental Appropriations Act.

All applications and eligibility are done through local community action agencies, which can be found on the Iowa Department of Human Rights website at humanrights.iowa.gov.

“We try to make it as easy as possible to get everything taken care of,” Marquess said. “Payments are issued through the community action agencies as well to the utility.”

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