In rural Alaska, loss of heating assistance hits hard

As winter approaches, thousands of Alaskans grapple with rising heating bills.

This year, for the first time in nearly a decade, the state won’t step in to help.

More than 9,000 households will see their heating assistance benefits reduced. Another 1,300 will likely be booted entirely from a now-defunct state program designed to keep low-income Alaskans out of the cold.

In 2008, the state was in a different place. 

“Plenty of money in the coffers, the price of oil was high. Home prices for home heating was very high and they wanted to try to offset that,” said Susan Marshall, heating assistance program coordinator for the state. 

The legislature created a heating assistance program to help low-income households cope with high fuel prices, she said. The program was a counterpart to the federal Low Income Home Energy Assistance Program, or LIHEAP and helped cover people whose incomes were too high to qualify for LIHEAP.

And that program was tied directly to the price of oil.

Marshall said she would crunch the numbers.

“So, I would go back and look at the price of a barrel of North Slope crude. Take an average of what the price was,” she said.

When the price of oil was high, more money went into the program.

The state also subsidized the federal heating assistance program, so that the lowest-income Alaskans got money from both to help with heating bills.

But, when oil prices crashed — so did the state’s budget.

The state cut the heating assistance program last year in an effort to trim spending.  

The federal LIHEAP program is still in place, but it only serves the lowest-income Alaskans.  

The loss of state funding to that program will drop payments to those households by 30 percent this year, which means that more than 10,300 households in the state will see their benefits reduced or eliminated entirely this year.

The heating assistance benefits are determined based on what type of fuel the household uses for heat — like wood, coal or natural gas, and how big the home is.

Priority goes to homes with older, disabled or young family members.

The benefits also factor how cold a region gets. 

On average homes in Fairbanks and North Pole received almost twice the amount of heating assistance when compared with homes in Anchorage, according to state data.

While the largest numbers of people were cut in urban areas of the state,  the cuts are hitting especially hard in rural areas, where it’s more expensive to live and fuel prices are still high.

In Dillingham, temperatures have been dropping into the 20s and high teens at night.  

“So basically every day we have some kind of crisis application on the phone, which is typical this time of year,” said Rae Belle Whitcomb, who is director of the Workforce Development Center for the Bristol Bay Native Association.

The association serves 28 out of the 31 villages in their region with federal heating assistance. The program pays for everything from heating oil, to wood, and electric bills.

By the second week of November they’ve had more than 260 applications, about one-third of the more than 700 applications they’ll get in Bristol Bay every year.

Out of that, about 110 homes had incomes that are too high to qualify for the federal program.

Whitcomb said they’ve helped people budget, encouraged them to weatherize, turn down thermostats and dress warmer in their homes.

“What can and does happen sometimes is people will move in together. So there’ll be more families living together because they can’t afford not to,” she said.

Whitcomb said she’s hearing from a lot of people who don’t have the income to make up for the loss of heating assistance.

And a big part of that was the cut to the PFD.

Gov. Bill Walker vetoed about half the amount that was supposed to be paid out.

Alaskans got about $1,000 less than what was projected.

“The double whammy of that was huge,” she said.

The cuts hit harder in rural Alaska because not many people have other sources of income.

“You can’t go down and get a McDonald’s job for $9.75 an hour. There’s not many of those other jobs,” she said. 

Whitcomb said the recent warmer winters have made things easier, but she’s worried this year will be much colder.

To see the number of households affected by cuts to the state’s AKAHP heating assistance program this year, see the graphic below.

Data from the Alaska Department of Health and Social Services Division of Heating Assistance.