WASHINGTON – Consumer advocates are sounding the alarm over a wide-ranging proposal from the Office of Management and Budget (OMB) to change how decisions about federal funding are made. The result of these changes would subject all federal funding, including for basic programs like energy assistance, to a political litmus test and additional bureaucratic hurdles and red tape.
Advocates warn the proposed changes would cause widespread confusion for program administrators and service disruptions for families most in need, especially in programs like the federal Low Income Home Energy Assistance Program (LIHEAP) which helps low-income families afford utilities during extreme heat and cold.
“This proposal risks harming the health and safety of the Black and Brown families and people with disabilities, who are at the greatest risk of energy insecurity and serious, even fatal, health complications from the lack of heating and cooling,” said Olivia Wein, senior attorney at the National Consumer Law Center. “We urge the OMB to reject these proposed revisions due to clear errors in procedure and potential harms to people in need.”
NCLC filed comments noting that the proposal would dramatically limit the reach of life-saving assistance to high-need households through LIHEAP and the Department of Energy’s low-income Weatherization Assistance Program (WAP) — creating financial instability for families already struggling to make ends meet.
LIHEAP is a long-standing federal program that receives an annual appropriation from Congress to address low-income household energy affordability. It is designed to mitigate health and safety harms from the lack of heat in the winter and cooling in the summer. Federal data reports nearly twice the rate of energy insecurity for Black and Hispanic households compared to all U.S. households. The proposal would hinder the ability of LIHEAP to address this uneven energy insecurity landscape in part because it purports to ban any federally funded efforts at racial equity or inclusion and prohibit tools used to identify and challenge discriminatory conduct.
In over half the states, the same agency that administers LIHEAP administers the Department of Energy’s low-income Weatherization program. The proposed changes could cost low-income households access to both programs and significantly disrupt the functioning of state agencies that administer the distribution of the funds.
Programs like LIHEAP are time sensitive. States rely on the ability to prepare winter heating assistance grants at the start of the new fiscal year on October 1. Adding processes that slow down the processing of state, territory, and Tribal LIHEAP program applications will have a ripple effect, advocates warn and lead to increasing and protracted delays, likely resulting in many families not receiving timely assistance.
The proposal affects over $1 trillion in annual Federal grants and cooperative agreements across 41 agencies. All of these grants would now be subject to review for conformity with the president’s political agenda, regardless of the Congressional intent in appropriating the funds or the language of the enabling statute. Despite the predictable impact on governments and nonprofits across the country, OMB has failed to quantify the impacts on the States, Tribes, territories, community action agencies, and the other nonprofits involved in administering federal programs. Parties were only given 45 days to comment, which advocates insist is inadequate time to analyze the full impact of these sweeping changes.
A few of the impacted programs NCLC works on include those designed to help low-income households recover from natural disasters, provide emergency low-income water assistance, provide rental and other housing assistance, and enhance broadband affordability. The recently enacted 21st Century ROAD to Housing Act, and its provisions authorizing funding to help advance and sustain affordable homeownership, is also at risk.
Consumer advocates are also concerned that the proposal could impact the ability of legal services offices across the country, including ones located in rural areas, to meet the needs of the low-income communities they serve.
“The proposed rules will create a cloud of uncertainty surrounding federal grants and a bottleneck that will slow down the release of funds for all programs, not just those identified as promoting diversity, equity, inclusion, and accessibility, or other programs disfavored by the current administration,” said Odette Williamson, director of Racial Justice Advocacy at NCLC. “This is simply unworkable and will disproportionately harm families of color, including those that rely on LIHEAP to keep heat on in the winter and run life-saving air conditioning in the summer.”
Related Resources
Support NCLC
Please support NCLC's work to advance consumer rights and economic justice with a tax-deductible contribution today!
Donate