Utility Bills Burden the Poor and Can Cause Homelessness

Information by State  Print version

Although the definition of “affordability” includes both rent and utilities, people do not usually think of the impact of utility bills on low-income households. Utilities impose a disproportionate burden on the poor. For single, elderly poor and disabled persons living on Social Security Income (SSI), the average energy burden was 19 percent of SSI. In selected States—Delaware, Illinois, and Vermont—it was nearly 25 percent.

For Aid to Families with Dependent Children (AFDC), the energy burden was, on average, seven times greater than for families at median income. AFDC families paid an average of 26 percent of their income toward energy, while median income families spent an average of less than 4 percent of their income on energy.

See “The Cold Facts: The First Annual Report on the Effect of Home Energy Costs on Low-Income Americans”.

• National Energy Assistance Survey Report
  This abstract provides a summary of the NEADA and NLIEC national survey of 2,161 LIHEAP recipients to collect information on the choices made by households in FY 2003 when faced with high energy bills.
  more... | Abstract | Full Report

The National Energy Assistance Directors’ Association released a study on April 5, 2001, that finds "Millions at Risk for Energy Cutoff". The results of a study showing that as many as 3.6 million families in 18 states, plus the District of Columbia, risk having their energy cut off because of the effects of rapidly increasing energy costs. Some states have moratoria on utility cutoffs during the cold months; some do not. Table 1 of the study has a summary of arrearage and shutoff information.

Utility cutoffs cause homelessness. You can document this in your own communities by following the example of Greg Copeland of the Energy Cents Coalition in St. Paul, Minnesota. “FROM HEATLESS TO HOMELESS” is a study based on research of 1997 St. Paul municipal records on evictions due to condemnation. Energy Cents’ analysis revealed:

• 26 percent of evictions were due to electric and gas termination.
  
• 40 percent of evictions were due to water cutoffs.

The termination of service can threaten the home, health, safety, and perhaps even the life of household members. The extent of the problem can be documented in other communities and can be added to the data on needs in a city’s Consolidated Plan.