Senate Republican leaders to review legislation to prevent fraud in LIHEAP
HARRISBURG - Legislation seeking to prevent fraud in the state heating assistance program is being reviewed by Senate Republican leaders, as the bill-voting session enters its final days.
The House unanimously passed a bill in June that would require state officials to verify the income eligibility of recipients of the Low Income Home Energy Assistance Program, set fraud-reporting requirements for program employees and contractors and require a periodic performance audit. The bill cleared a Senate committee two weeks ago.
LIHEAP, which is federally funded and state-administered, seeks to blunt the impact of high energy costs by providing cash grants to help hundreds of thousands of low-income Pennsylvanians pay heating bills during the winter months and receive emergency stipends to fix broken furnaces and deal with other emergencies. The Department of Public Welfare will take new applications for LIHEAP starting Nov. 1.
The LIHEAP fraud bill fits with a much-promoted effort by the Corbett administration to root out fraud in public assistance programs run by the DPW. The agency supports the legislation, said DPW spokeswoman Anne Bale.
The state Office of Inspector General takes a lead role in prosecuting welfare fraud and publishes lists of individuals prosecuted and sentenced for fraudulently receiving benefits.
At the root of this legislation is a 2007 audit by state Auditor General Jack Wagner that found potential fraud and abuse of LIHEAP benefits in six test counties. One glaring case was in Philadelphia where auditors found that 429 applicants received more than $162,000 in benefits using the Social Security numbers of deceased individuals.
More recently, the Legislative Budget and Finance Committee issued a report last June highlighting administrative changes to LIHEAP, including introduction of a computer system that verifies applicants' Social Security numbers and checks federal and state tax information.
More than 30 percent of 2011 applications for heating grants were rejected with household income exceeding limits being a key reason, the report stated. That year, LIHEAP provided $219 million in heating grants and $45 million in crisis benefits with most of this money going directly to fuel vendors and utilities that provide heating to recipients.
The report noted that unpredictable federal funding makes it difficult to run what's basically a part-time seasonal program.
The amount of federal aid a state anticipates it will receive influences the income eligibility limits, the opening and closing dates for the program and seasonal staff needs, the report stated. For example, when Congress provided more aid in 2009 because of a spike in fuel oil prices, Pennsylvania increased income eligibility limits. When federal aid was subsequently reduced, so were eligibility limits.
"While it is a difficult program to manage, due in large part to the uncertainty of funding from year to year, providing needed heating assistance to as many eligible Pennsylvanians as possible is an annual challenge," said DPW Secretary Gary Alexander.
Washington has cut the state's share of LIHEAP aid by $100 million since fiscal 2010-11. Pennsylvania expects to receive $166 million in federal funds this year, Bale said.
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