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Rell, Legislators Plan Session On Heating Oil Costs

By CHRISTOPHER KEATING | Capitol Bureau Chief

August 02, 2008

Gov. M. Jodi Rell reached a broad agreement Friday with Democratic legislative leaders to hold a special session to help consumers with skyrocketing heating oil prices expected this winter.

The two sides have agreed to spend the state's $22 million surplus to provide relief to a wide range of individuals and organizations. Rell unveiled a series of proposals Friday on how the money could be spent, but the final details of the legislation will not be settled until the Democratic-controlled legislature meets in caucuses. The 107-member House Democratic caucus is set to meet next week.

"Everyone is in agreement that we need to take all the steps that we can to help folks with energy costs," said Senate President Pro Tem Donald Williams. "We are going to pass some legislation to help the people of Connecticut through what we know is going to be a very tough winter. That's the bottom line. What we want to do is to get it done, and I predict that's what's going to happen."

The expected date for the session is Friday, Aug. 22 — the last working day before some lawmakers leave for the Democratic and Republican national presidential conventions in Denver and MinneapolisSt. Paul.

Williams and a bipartisan group of top leaders met with Rell at the governor's mansion in Hartford's West End Friday as Rell introduced an 11-point plan for relief.

"The sooner we address what we all know will be very tough times for so many people this winter, the better," Rell said. "With the price of heating oil heading toward $5 a gallon, we do not want Connecticut families and senior citizens having to choose between food and fuel this winter."

Many of the precise details were not set Friday because the bill has not been written and the legislature's nonpartisan fiscal office has not yet released its own surplus estimate — which will help determine exactly how much the state can spend. Rell and lawmakers also want to spend federal money from the Low-Income Heating Energy Assistance Program, known as LIHEAP.

Among the various ideas, Rell wants to:

•Provide funding to the nonprofit Operation Fuel to help both lower- and middle-income families. Operation Fuel is an umbrella organization of local fuel banks across the state that helps needy families who are not poor enough to qualify for government assistance. If funding is available, assistance could go to families earning as much as $78,154 annually, which the U.S. Census Bureau cites as the Connecticut median family income for 2006.

•Prevent heating oil dealers from imposing a surcharge on deliveries of less than 100 gallons. Currently, dealers are prevented from imposing an extra charge on deliveries over 150 gallons. As such, a homeowner who calls a dealer and orders 75 gallons could end up paying a surcharge.

•Force the dealers to report to the Department of Consumer Protection on their pre-paid contracts. This is designed to prevent situations similar to this year's collapse of a Waterbury-based company in which consumers complained that they made pre-paid deposits under a locked-in price and then never received the oil.

•Send money to cities and towns to help heat school classrooms.

•Help nonprofit organizations, which provide health and human services, with their heating bills.

•Allow Operation Fuel to receive 50 percent of the money that the state would normally receive from abandoned utility deposits and refunds.

While top leaders said there was a bipartisan agreement on many aspects of fuel aid, Republicans said they will still seek to cut and cap the state's gross receipts tax on gasoline. Since the gross receipts tax is based on the wholesale price, the tax has increased by 18 cents per gallon over the past three years, lawmakers said.

"We can and should provide relief in terms of gasoline taxes," said Senate Republican leader John McKinney of Fairfield. "We're going to continue to try."

Republicans have been blocked in their efforts this year because Democrats say that the state needs the increased money from gasoline taxes to avoid even worse deficits in the current fiscal year. Standing next to McKinney during a press conference in the driveway outside the governor's mansion, House Speaker James Amann blasted the Republican call for cutting the tax.

"It's a dumb idea," Amann said as he stood virtually shoulder-to-shoulder with McKinney. "We have declining revenues at a time when next year we're going to have deficits. ... Casino revenue is down. Corporate revenue is down. Certainly, income tax revenue is down."

McKinney then responded, "There are no dumb ideas, only dumb people with ideas. Right, Jim?"