A RECENT PAY RAISE turned out to be the breaking point — ultimately leaving her cold and in tears.
A single mother, her pay went up at the jewelry distributor where she’s worked nearly five years as a customer service agent. That should have been a welcome development, since she and her 9-year-old son struggle on yearly income of about $18,000.
But her share of the rent in a subsidized apartment in South Providence is based on her income, so her rent also went up. To handle that, she stopped paying her $180 monthly gas bill — which she was already finding unmanageable.
This did not mean that her heat went off immediately. Rhode Island has a moratorium against utility shutoffs during the winter. But the moratorium ended April 15, and on May 4, the New England Gas Company turned off her service for nonpayment of a $1700 bill.
"I’ve been so cold," says the 29-year-old woman, whose name is being withheld by the Phoenix, since she fears she’ll be evicted if her landlord learns she’s not maintaining utility service. She suffers from asthma, a condition particularly troublesome when she’s cold. Her apartment in late spring (this May was the fourth coldest on record) was more forbidding than it had been during the winter. She and her son have been staying some nights with her mother, a problematic arrangement, since the mother lives in a housing complex for the elderly, where the rules discourage visitors, and of course, the boy misses his own space and toys. Hers is one of more than 1260 stories of gas shutoffs since the moratorium ended.
If this year follows the pattern of last year, the gas company will dispatch shutoff crews to households at the rate of 1200 to 2000 a month. That means more than 11,000 Rhode Island households will have lost natural gas service between now and the coming winter.
It’s a cumbersome process, and not just for the residents. In business as an energy provider, New England Gas also expends considerable effort as an energy depriver. The company works first to get slow-paying, under-paying, and non-paying households to ante up. As a last resort, it sends out the shutoff crews.
Not illogically, the target householders sometimes don’t let the company inside. So, unless there’s meter access from the outside, workers are forced to dig through the pavement of street, down to the gas line, to which they attach a valve to shut off service, a process the company estimates costs $700 each time. And since most utility service is restored eventually, the process has to be done again in reverse, with crews returning to homes to which they have access, or, excavating the streets to reach the valves they buried in the shutoff phase.
There is nothing new about this. The utility shutoff cycle is as regular as the changing seasons, although it’s likely most Rhode Islanders are unaware of the sheer number of households that lose gas service for some period during the spring, summer and fall — the kind of numbers that would might make headlines after a hurricane, but that go unnoticed when they occur as individual financial crises. The affected families aren’t in danger of freezing during this warmer period. But they do lose hot water and perhaps use of their kitchen stoves, and there’s discomfort and the emotional stress from worry, shame and the anger that come with living without a basic service.
Also part of the routine is an on-going effort put an end to this off-and-on-and-off-again melodrama. The latest chapter is now playing out at the State House in the form of an elaborate proposed bill scheduled for introduction this week.
The draft bill calls for 11,000 of the state’s poorest households to enroll in a three-year test program, in which much of their heating costs would be subsidized, allowing them to pay just four percent of their annual income for heat.
Customers also would be required to pay $10 a month toward past-due bills, or a total of $360 after three years. The subsidy program then would pay half of the remainder, with energy companies (and ultimately, their customers) swallowing the rest as bad debt. New surcharges on heating energy could raise nearly $8.8 million a year to fund the program.
But just as this has been a surprisingly chilly spring for Rhode Islanders, the new plan — even before its scheduled introduction — is getting an unexpectedly frosty reception.
THE THEORY BEHIND the latest proposal is this: it costs about the same to heat a poor family’s home as it does a middle class house, but a low-income householder can’t afford the full price tag.
For example, the gas company estimates a "typical" house that heats with gas and uses that fuel for hot water and cooking may spend $1451 in a year. It’s an annoying, but manageable, bill for a median income household earning $44,050 — three percent of annual income. But it’s a crisis for a home such as the South Providence customer service representative, equivalent to eight percent of her $18,000 annual income.
None of this involves advanced mathematics. So what’s the hold-up? Money, of course.
A similar plan died in 2003 when consumer advocates proposed tapping gas and electric bills with an extra one percent surcharge, to raise about $11.7 million. The state Public Utilities Commission, which itself had proposed the study that gave rise to the plan, rejected it out of hand.
Hoping to find a different solution this past winter, Governor Donald L. Carcieri asked the Reverend John E. Holt, who heads the Rhode Island State Council of Churches, to chair a broad-based committee to develop a new plan. Holt filed his report this spring with Carcieri and state Senate President Joseph A. Montalbano. The Senate, in turn, assigned a key public policy expert, Kenneth Payne, to draft a bill that now runs 25 pages.
What’s new this time is not the theory — asking the poor to pay just a portion of their income for heat. The fresh ideas involve the sources of the money and the somewhat changed scope of the program.
Previous anti-shutoff plans had been aimed at both gas and electric customers, because those energy sources are subject to state regulatory control, unlike oil heat. In fact, warm-weather shutoffs for non-payment of electricity reach almost the same level as those for gas. But the Holt group decided to focus just on heat, so the new plan concentrates on natural gas and a small number of households that heat with electricity, and for the first times, brings homes with oil-fired furnaces into the picture.
In an interview, Holt says compromises had to be made by committee members, because the utility representatives, consumer representatives, social reformers and others had strong and often hard to reconcile views and goals.
"Everybody felt like they kissed the pig a little," the clergyman says. "Nobody got 100 percent . . . everybody had to give a little bit."
But as it turned out, no one kissed the pig squarely on the lips.
The Holt committee identified only one source of new money, a proposed 1.25 percent surcharge on home heating oil. Holt figures that could cost householders $20 to $24 yearly. Even so, the Oil Heat Institute of Rhode Island, representing about 30 major dealers, didn’t sign the committee’s report. Meanwhile, the Holt group punted on the touchy issue of finding other funds, stating only, "The General Assembly will have to identify other revenue to fund the program."
As a result, the fund-raising chores fell in the lap of Senate policy analyst Payne, a veteran behind-the-scenes government operative who once headed the Rhode Island League of Cities and Towns, served as an aide to former US Senator Claiborne Pell and has a doctorate in planning from the University of Massachusetts.
Payne went for advice to the gas company, which had helped shoot down the previous program two years ago because of the bite it proposed to put on its customers, especially big commercial users.
Christopher J. Medici, a gas company spokesman, says in a recent interview that the utility’s position is that it already is doing its part: the company contributes nearly $2 million in various low-income assistance programs. And of course, it also writes off unpaid bills in the form of $10 million to $11 million worth of bad debt, which the PUC allows the company to charge back to customers in the form of higher utility rates.
But Medici says the company seriously wants to reduce the shutoff problem and is willing to do what its oil heat competitors are being asked to do: ask customers pay an extra $24 dollars a year. The gas company suggested to Payne a $2 per month, per-customer fee, which Payne estimates could raise about $6 million. (About $250,000 also would be raised in a small assessment on an electricity fund, covering the electric heat group.)
There is one stipulation to gas company’s support, Medici says: the oil industry’s participation. "If oil is out," he says, "I think the gas company probably is not going to be able to support that either."
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Issue Date: June 10 - 16, 2005
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