$20M for propane shortage consideredPublished 9:25am Tuesday, February 25, 2014
ST. PAUL — A bill introduced Monday to put $20 million into a heating-assistance program for low-income Minnesota residents is set to go to the floor of the state House of Representatives today.
After convening for the 2014 legislative session today, the state House plans to suspend its rules to immediately take up the bill, according to a statement from the Minnesota House DFL caucus.
The urgency is due to a shortage of propane that has affected a large swath of the nation. Fuel prices have skyrocketed during the coldest winter Minnesota has endured in 35 years.
“The safety of Minnesotans is at risk,” said Rep. Joe Atkins, DFL-Inver Grove Heights, who chaired the Monday afternoon House commerce committee hearing that considered the bill. “This is no different than a tornado or a flood or some other emergency that we might face.”
During his testimony to the committee, state Commerce Commissioner Mike Rothman said that his staff received calls as recently as last week from people who said they were running out of propane to heat their houses.
The $20 million would be used to prop up Minnesota’s low-income heating assistance program, which Rothman projected would otherwise run out of money by early March.
The program’s financial crisis resulted from Gov. Mark Dayton’s decision earlier this month to expand the state’s income eligibility for heating assistance, for any fuel, from 50 percent to 60 percent of the state’s median income, Rothman said.
“That added 120,000 more people,” said Rothman, which drained the funds more quickly. Congress allocated $115 million to the program, but Rothman said he doesn’t expect any more federal aid.
In a memo to legislative leaders Friday, Dayton’s chief of staff, Jaime Tincher, said the Democratic governor is asking the Legislature to pass the $20 million in low-income heating assistance on the Legislature’s opening day so that Minnesota residents would not experience a delay in receiving their payments.
An estimated 250,000 Minnesota households use propane to heat their homes, mostly in rural areas where connections to municipal heating infrastructures don’t exist.
“I’m sure all of you have heard from constituents of yours that they are paying very high prices for propane,” said Rep. Joe Radinovich, DFL-Crosby, who authored the bill. “There are a lot of seniors living on fixed incomes in my constituency.” Crosby is about 130 miles north of the Twin Cities.
Average Minnesota residential propane costs peaked at $4.67 gallon at the end of January, compared with $1.60 at the same time last year, said Anne O’Connor, state Department of Commerce spokeswoman.
Since then, the average price has fallen to $3.27 a gallon — or $654 to fill a 200-gallon tank — compared with $1.63 at the same time last year, O’Connor said. Historically, average propane prices hover just above $2, she said.
A late and wet harvest increased demand for the fuel from farmers, who needed to dry an uncommon amount of grain before storage. That depleted national propane supplies. Reserves dropped to their lowest levels ever during the second week of January after frigid temperatures blasted much of the nation. Demand and prices then skyrocketed.