Effective Procedures for Increasing LIHEAP Program Efficiency
THIS CONTAINS INFORMATION ISSUED BY THE U.S. ADMINISTRATION FOR
CHILDREN AND FAMILIES IN LIHEAP ACTION TRANSMITTAL NO. LIHEAP-
AT-2008-11, DATED 8/4/08
TO: LOW INCOME HOME ENERGY ASSISTANCE PROGRAM (LIHEAP)
STATE GRANTEES
SUBJECT: Effective Procedures for Increasing LIHEAP Program
Efficiency
RELATED
REFERENCES: Section 2610 of the Low Income Home Energy
Assistance Act of 1981, Title XXVI of the Omnibus
Budget Reconciliation Act of 1981, Public Law
97-35, as amended
PURPOSE: The purpose of this transmittal is to solicit
State recommendations of effective practices for
increasing LIHEAP program efficiency.
BACKGROUND: Section 2605(b)(3) of the Low-Income Home Energy
Assistance Act of 1981, as amended through
August 1, 1999, ("Statute") limits the amount of
LIHEAP funds that grantees may use for planning
and administrative costs (referred to in this
transmittal for simplicity as "administrative
costs") to 10 percent of funds payable for a
fiscal year. Any costs in excess of this limit
must be paid from non-federal funds.
Neither the LIHEAP statute nor Federal regulations
define LIHEAP administrative costs. Instead,
grantees are to develop their own definitions,
consistent with the statute and regulations. The
Department of Health and Human Services defers to
the State's definition unless it is based on an
interpretation of the statute that is "clearly
erroneous"[45 CFR 96.50(e)].
The last time that OCS addressed LIHEAP
administrative costs was in LIHEAP Information
Memorandum (IM) Transmittal No. LIHEAP-IM-2000-12,
dated March 15, 2000. In that IM we responded to
requests for information on Temporary Assistance
for Needy Families regulations that define
administrative costs and how those regulations
relate to LIHEAP. The IM also provides grantees
previously issued LIHEAP administrative cost
discussions in one place for ready reference.
That IM is located on our web site at:
www.acf.hhs.gov/programs/ocs/liheap/guidance/
special_topics/im00-12.html
OCS has collected State-level data on LIHEAP
administrative costs for many years through the
LIHEAP Grantee Survey. According to the Survey
instructions, States are to indicate the amount of
funds obligated for administrative and planning
costs. The amount is to include (a) all State and
local administrative and planning costs, and (b)
both direct and indirect costs charged as
administrative/planning costs for the program.
CONTENT: The Office of Management Budget (OMB) requires
Federal programs to collect, track, and analyze
data on program efficiency as part of OMB's
Program Assessment Rating Tool. Recently, OCS has
used State-reported LIHEAP administrative cost
data to compute a LIHEAP efficiency measure.
LIHEAP's efficiency measure deals with the number
of LIHEAP assisted households served per $100 of
LIHEAP administrative costs. The measure is
calculated by (1) adding the number of households
receiving each type of LIHEAP assistance, (2)
dividing that amount of LIHEAP administrative
funds, and (3) multiplying that result by 100.
There are a number of limitations in interpreting
the efficiency data, including whether assisted
households are receiving adequate LIHEAP benefits
that result in affordable home energy costs.
Furthermore, LIHEAP assisted households are counted
more than once if they received more than one type
of LIHEAP assistance. One would have to assume
that the percent of households receiving more than
one type of LIHEAP assistance does not change from
year-to-year. This is a dubious assumption which
has led OCS, in part, to propose to OMB that the
States report unduplicated data on the number of
households receiving LHEAP assistance, regardless
of the types of LIHEAP assistance provided to the
household.
OCS's efficiency goal is to increase the efficiency
of the program in serving households. This goal
leads to the question of whether there are
effective practices that State use to increase
LIHEAP program efficiency. Thus, we are requesting
States to provide brief descriptions of practices
that they believe stretch LIHEAP administrative
funds in serving the greatest number of households.
We realize that there are a number of program
design factors that affect States' administrative
costs, such as whether a State is running a
centralized vs. decentralized program, or whether
a State relies on mail-in applications.
OCS will accept written comments from State
grantees that are emailed to Leon Litow by August
29, 2008. An acknowledgment email will be sent to
grantees from which email comments have been
received. A compilation of the written comments
will be distributed in a LIHEAP IM sent to LIHEAP
grantees later this summer.
Thank you for your assistance in this matter.
INQUIRIES TO: Leon Litow, Lead Program Analyst
Division of Energy Assistance
Office of Community Services, ACF
370 L' Enfant Promenade, S.W.
Washington, D.C. 20447
(202) 401-5304
E-mail: llitow@acf.hhs.gov
_____________/s_____________
Josephine B. Robinson
Director
Office of Community Services
