Unsung Hero: How Utility Assistance Plays a Vital Role in Helping the Poor
A while back I was surprised to learn from an experienced social worker that there are what amount to “fads” in social service as well. At the time, she told me, “utility assistance” — or providing help to low-income individuals and families to keep from having their power or water turned off — was waning in popularity, in part because it was often perceived as a Band-Aid measure, and not a measurable contributor to real change over time. In other words, a person who needs utility assistance today might need it again in the future — which apparently gets construed as a defeat for the system or at the very least an un-sexy way to help somebody in need.
But that turns out to only be part of the picture.
As with virtually anything else, if you dip into the research literature you start to see a bigger picture of what something seemingly so innocuous is tied to. For one thing, maternal depression — which in turn affects child development and things as initially distant-seeming as academic performance and attainment, which affect future income levels, etc.
In fact, when researchers studied just which forms of material hardship were linked to maternal depression, the strongest links were from trouble paying bills and having phones cut off.
Researchers in public health and social work are beginning to look more closely at the forms of material hardship people suffer, and how those are tied to other difficulties including poor physical health.
In New York City, researchers are using a “longitudinal poverty tracker” that follows families over time, allowing them to pay special attention to key forms of material hardship families suffer, including food insecurity, housing hardship, unmet medical needs, utility cut-offs, and financial insecurity, along with income poverty and adult health problems.
In an article entitled “Beyond Income Poverty: Measuring Disadvantage in Terms of Material Hardship,” Kathryn M. Neckerman, Ph.D. and her co-authors suggest that poor individuals and families experience more hardship — and more persistent hardship — than others, especially if they are people of color. The article was published in Academic Pediatrics, the official journal of the American Pediatric Association.
More than half the poor families studied experienced material hardship, according to the study’s authors, Neckerman et al., with blacks and Hispanics experiencing greater rates of disadvantage — even after adjusting for educational attainment and family characteristics. “These results suggest that in addition to addressing income poverty, policymakers should give priority to efforts to reduce material hardship and help families cope with chronic physical or mental illness,” the authors wrote. “The need for these resources extends far above the poverty line.”
Just like with housing, where “cost-burdened” aptly describes families having to spend more than 30 percent of their income on housing, an equivalent burden from utility bells amounts to what’s considered to be “energy poverty.” The Texas Energy Poverty Research Institute (TEPRI), a nonprofit, defines energy poverty as “a condition faced by many Americans in which the personal cost of consumption needed to maintain a healthy lifestyle creates a significant or unnecessary economic burden.”
If you live in a very hot climate — or a very cold one — really, any place but a temperate climate — you’re familiar with how heating and cooling bills spike seasonally, often for a period of multiple months running. While this may not present a real problem to high-earning households, for those below the poverty line the experience can be a crushing burden, or part of the crushing burden they already bear.
While six percent of a family’s income spent on utility bills is considered by experts to be a reasonable and affordable level, for many who live in poverty or deep poverty the figure can be much higher than that. Economist DeAndrea Newman Salvador, quoted in the Atlantic, studied the figures for her own North Carolina and noticed just how “staggeringly high” energy expenditures were for people below the poverty level.
“Citing data from the Department of Health and Human Services, Salvador added that the disparity was particularly prevalent among people who were below 50 percent of the poverty level. She found that many in this group “were spending roughly 35 percent of their income toward home-energy bills.”
Just to clarify, the current federal poverty level is $25,100 for a family of four, so deep poverty — 50 percent of that — is a family of four living on less than $12,550 a year. A staggering 35 percent of that family’s household income spent on utility bills would mean they’re paying, not $753 (the healthier guideline of six percent) but a whopping $4,392.50, or just over $366 a month(!).
And the relationship is a powerful one. “For every 10 percent increase in home energy costs, 840,000 Americans (are) pushed below the poverty line,” according to TEPRI. The most vulnerable of all? Households with young children, the elderly and those with disabilities.
A 2011 study from the National Energy Assistance Directors’ Association found that almost one quarter of Low-Income Home Energy Assistance Program (LIHEAP) recipients kept their homes at unsafe or unhealthy temperatures in the previous year, due to not having enough money to pay their energy bills.
In an effort to quantify the gap between “affordable” home energy bills and “actual” home energy bills, Fisher, Sheehan & Colton (FSC), a law and economics research and consulting firm based in Massachusetts developed a model that estimates the “home energy affordability gap” on a county-by-county basis for the entire country.
As an example, Bexar County — where San Antonio, the nation’s 7th largest city, is located — enjoys approximately 300 days of sunshine a year. For the 126,048 residents (6.65 percent) of the county who live in deep poverty, residents are spending approximately 29.4 percent of their income — or $2,294.63 over the course of a year — on utility bills.
(These figures coincide with those cited by the Home Energy Affordability Gap research, which estimates that households in deep poverty spent approximately 29 percent of their household income on energy bills in 2017.)
Besides climate (whether the place you live is very hot or very cold) and energy prices, what other things are high utility bills tied to? A significant one is the age of the home — which can affect energy efficiency — the level of insulation — even how old the appliances are.
When we had a new door installed a few years back, I remember asking the Lowe’s installer what he was doing — he seemed to be stuffing or packing some material deep into the walls around the door frame. “Insulation,” he replied — “You didn’t have any.” (And then he added that was the case with many of the homes he saw on his visits. Ours was built in 1984.)
(Inspired by TEPRI’s work, I went ahead and created some data maps about average age of housing stock by ZIP Code in San Antonio — and then animated the results to make it more obvious where older homes are in the city, those most likely to be in need of weatherization.)
The federal emphasis on weatherization appears unfortunately to be declining, due to budget cuts. In its heyday, the Weatherization Assistance Program (WAP) served more than seven million households over its more than 40 year existence. Today, help is more likely to come from other resources, including ratepayer-funded energy efficiency programs, according to Kat Friedrich, of the Yale Center for Business and the Environment. Friedrich points out though that those account for only 10 percent of the help provided — the rest comes from, you guessed it, utility assistance (help with actual bills).
There’s a public health aspect to this as well as an economic development angle to it that should not be overlooked. Benefits that weatherization provides include, according to Friedrich:
“On a community level, weatherization programs contribute to public health by reducing unsafe drafts, eliminating carbon monoxide, lowering pollutant levels, and improving energy access. They also reduce mental health issues that can occur due to inadequate winter heating.”
“Weatherization also facilitates economic development by funneling more into community residents’ bank accounts. There is a multiplier effect when households can spend more money locally. The creation of weatherization-related jobs also has a ripple effect that benefits tradespeople, businesses and families. Meanwhile, landlords benefit from improved property values and more satisfied tenants. … Utilities (also benefit from having) less infrastructure to maintain and fewer shutoffs to handle when weatherization improves the housing stock.”
With this many positives— from improved mental and physical health and more disposable income to go back into the local economies for individuals and families, to job creation, improved property values, even greater efficiencies for the utility companies themselves — it’s hard to believe anyone could be against programs that improve energy efficiency for low-income residents. Not addressing this issue, which often comes to light first via a community member needing help with utility assistance, puts families’ safety and well-being at risk.
Editor’s note: Want to read more? This article is part of an informative series on “unpacking poverty.” You can find more here.