Awards of FY 2006 LIHEAP Leveraging Incentive Grants
THIS CONTAINS INFORMATION ISSUED BY THE U.S. ADMINISTRATION FOR
CHILDREN AND FAMILIES IN LIHEAP INFORMATION MEMORANDUM TRANSMITTAL
NO. LIHEAP-IM-2006-10, DATED 8/24/06
TO: LOW INCOME HOME ENERGY ASSISTANCE PROGRAM (LIHEAP)
GRANTEES AND OTHER INTERESTED PARTIES
SUBJECT: Awards of FY 2006 LIHEAP Leveraging Incentive
Grants
RELATED
REFERENCES: Low Income Home Energy Assistance Act, Title XXVI
of the Omnibus Budget Reconciliation Act of 1981,
Public Law 97-35, as amended; 45 CFR Part 96,
Block Grant Programs -- Final Rule, published May
1, 1995, in the Federal Register (60 FR 21332 et
seq.); and LIHEAP Action Transmittal 2004-7, dated
August 16, 2004, re: applications for FY 2006
leveraging awards.
PURPOSE: To advise grantees of FY 2006 leveraging
incentive grants to be awarded based on countable
leveraging activities carried out during FY 2005.
BACKGROUND: The Augustus F. Hawkins Human Services
Reauthorization Act of 1990 (Public Law 101-501)
amended the LIHEAP statute to establish a
leveraging incentive program to reward grantees
under the Low Income Home Energy Assistance
Program (LIHEAP) that have acquired non-Federal
home energy resources for low-income households.
Leveraging incentive funds are awarded to those
grantees that use their own or other non-Federal
resources to expand the effect of the Federal
LIHEAP dollars. Leveraging activities that took
place in one fiscal year will be used to determine
leveraging incentive grant awards in the following
fiscal year. For example, FY 2006 leveraging
incentive awards are allocated to grantees based
on countable leveraged resources that were
provided to low income households in FY 2005.
The Department of Health and Human Services (HHS)
issued final implementing regulations for the
leveraging incentive program on May 1, 1995
(60 FR 21332). Leveraging requirements in the
regulations are based closely on the leveraging
requirements in section 2607A of the Low Income
Home Energy Assistance Act.
Grantees desiring leveraging incentive funds
must submit an application each year -- the
LIHEAP Leveraging Report -- that delineates the
amount and types of leveraging activities they
carried out during the base period. HHS then
determines whether the reported activities meet
the requirements of the statute and regulations,
and, therefore, are countable under the program
for the purpose of determining allocations of the
incentive funds. In general, we give grantees the
benefit of the doubt where we can.
CONTENT: The FY 2006 appropriations law for HHS and
several other agencies (Public Law 109-149, signed
on December 30, 2005) included funding for LIHEAP
in FY 2006. The conference report on that law
provides that, of the amount appropriated for
LIHEAP for FY 2006, $27.5 million should be set
aside for leveraging incentive grant awards. Of
this amount, the 1994 amendments to the LIHEAP
statute (Public Law 103-252) provide that up to
25% may be set aside for the Residential Energy
Assistance Challenge (REACH) Option Program. The
Department set aside the full 25% allowed for
REACH, leaving $20,625,000 for leveraging awards.
However, the FY 2006 appropriations law required
that a rescission that was applied to the final
appropriations for many federal programs. The
rescission was to be applied proportionately among
the individual budget authorities within each
federal program. Subsequently, a further
reduction was taken for transfer to HHS for
Medicare activities. Therefore, the new amount
available for leveraging awards in FY 2006 is
$20,214,562.
Applications for FY 2006 Leveraging Funds
We received applications for FY 2006 incentive
awards from 35 States, 28 tribes or tribal
organizations, and 1 territory. These 64
applications included claims for 628 separate
leveraging resources/benefits that took place in
FY 2005 with a gross claimed value totaling
$2,072,837,659. The net value of the claimed
resources is $2,072,398,782, after deducting
$438,877 for: (1) the grantees' own funds used to
identify, develop and demonstrate the activities;
(2) costs or charges to low income households to
participate in the activities; and (3) LIHEAP
funds used to identify, develop, and demonstrate
the activities (limited to the higher of $35,000
or 0.08% of a grantee's regular allotment for
State grantees, or to the higher of $100 or 2.0%
of the allotment for Indian tribes/tribal
organizations and territories).
After review by HHS, the claimed value of a
number of resources was eliminated or reduced
because part or all of the resource did not meet
necessary requirements for countability. We also
made a number of adjustments necessitated by
mathematical errors and/or revised information
received from grantees.
Overall, we reduced the claimed value of 11
resources because they are not countable in part
or there were errors in calculations. The value
of 2 resources was increased because of corrected
figures. After making these adjustments, we
approved 598 resources in whole or in part for 64
grantees (35 States, 28 tribes, and 1 territory),
for a gross value of $2,042,173,933 and a net
value of $2,041,735,056 after subtracting
offsetting costs of $438,877. Attachment 2 shows
the number and value of resources claimed by each
applicant, the amount of any adjustments to those
numbers and values made by HHS, and the final
approved number and value of countable resources
as determined by HHS.
Allocation of Leveraging Incentive Funds
Using the final values of leveraging activities
approved for each grantee, we calculated
leveraging grant award allocations based upon a
formula that is included in Section 96.87(c)(1)
of the LIHEAP regulations (45 CFR 96.87(c)(1)),
as published in a final rule in the Federal
Register on May 1, 1995 (60 FR 21322). (See page
21364 of the regulation and pages 21351-56 of
the preamble for further detail.)
The formula provides that one-half of the
funds, or $10,107,281 based on total available
funds of $20,214,562, is to be distributed based
on the amount of leveraging activities each
grantee carries out as a proportion of the amount
of its regular LIHEAP grant, taking into account
the amount of leveraging activities carried out
by all grantees as a proportion of their regular
grants. Because the leveraging activities took
place in FY 2005, we used allocations for FY 2005
in calculating this portion of the formula. We
included regular block grant allotments and
contingency funds allocated to leveraging
applicants in FY 2005.
The second half of the funds is to be distributed
based on the amount of leveraging activities
carried out by each grantee as a proportion of the
total amount of leveraging activities carried out
by all grantees. The amounts derived under the two
parts of the formula are then added together to
determine the final grant amount, except that no
grantee may receive more than (1) 12% of the
leveraging incentive funds available, or (2) the
lesser of the amount of its regular grant
(including any contingency and/or realloted funds
or twice the amount it leveraged.
The prohibition against receiving more than 12%
of the available leveraging incentive funds
affected only one State grantee this year
(California) limiting its grant award to
$2,425,747.
The prohibition against receiving more in
incentive grant funds than the lesser of twice
the amount leveraged or the amount of the regular
block grant funds affected 10 of the tribal
applicants and 1 territory this year. The tribes
in general do very well under our formula, in most
cases receiving much more in return for each
leveraging dollar invested than the States.
We redistributed the "excess funds" from
the 10 tribes, 1 territory and 1 State on a
proportionate basis to the other grantees.
Attachment 1 shows our calculations, with the last
column showing the amount of the actual leveraging
incentive grant award for each applicant.
Allowable Uses of Leveraging Incentive Funds
Leveraging incentive grant awards are being made
to each grantee in the amount shown in the final
column of Attachment 1, and will be available for
drawdown shortly. They may be obligated for
eligible activities in FY 2006 and/or FY 2007.
Grantees are reminded that the leveraging
incentive funds must be used to maintain or
increase benefits to low income households as a
part of the grantee's LIHEAP program. The incentive
awards may not be used for costs of administration
and planning, but they may be counted in the base
for calculating the grantee's maximum planning and
administrative costs (but these costs must be paid
from other funds, such as regular block grant
funds). Leveraging incentive grants for FY 2006
must be obligated by grantees no later than
September 30, 2007, or the funds will revert to
the Federal government. The leveraging incentive
funds are not subject to the 10% carryover limit
for regular block grant funds, and may not be
added to the base on which the carryover limit for
regular funds is calculated. The leveraging
incentive funds also are not subject to the 15%
limit on use of funds for weatherization activities,
and may not be added to the base on which the
weatherization limit for regular funds is
calculated. Consistent with the block grant
philosophy, grantees are the primary interpreters
in determining what constitutes an "obligation"
under their own financial laws and procedures.
Next Year's Applications for Leveraging Funds
We would like to remind all grantees that the
model plan application for regular LIHEAP block
grant funding includes a place to report
leveraging activities that are coordinated with
LIHEAP. You should include the information in
your plan for FY 2006 that will be necessary for
activities to count for leveraging funds to be
awarded in FY 2007. LIHEAP Leveraging Reports on
leveraging activities carried out in FY 2006 are
due by November 30, 2006 in order to qualify
for FY 2007 leveraging incentive grant funds.
Amendments to FY 2006 plans in order to
incorporate descriptions of FY 2006 leveraging
activities must be submitted no later than
September 30, 2006.
ATTACHMENTS: (1) Calculations of FY 2006 leveraging incentive
grant awards, by grantee.
(2) Listing of grantees submitting Leveraging
Report Forms on FY 2005 activities to qualify
for FY 2006 leveraging incentive grant awards,
including number and value of resources
claimed, adjustments to those claims made by
HHS, and final approved number and value of
resources.
INQUIRIES TO: Nick St. Angelo, Director
Division of Energy Assistance
Office of Community Services, ACF, HHS
370 L'Enfant Promenade, S.W.
Washington, D.C. 20447
Telephone: (202) 401-9351
Fax: (202) 401-5661
E-mail: nstangelo@acf.hhs.gov
_______________/s_____________
Josephine B. Robinson
Director
Office of Community Services
