April 02, 2020

In storm’s wake, search goes on for disaster funds

WASHINGTON — The Department of Housing and Urban Development said it cannot offer any other emergency funding other than Thursday’s early release of $28 million to help with the ice-storm wreckage — unless Congress provides HUD with an emergency appropriation.

At the same time, however, the Small Business Administration is considering whether Maine’s utilities would be eligible for disaster loans, which, if approved, would greatly defray the estimated $30 million in expenses already incurred by the utilities.

The search for federal disaster dollars has continued despite Vice President Al Gore’s announcement Thursday that the $28 million in HUD funding would be released immediately. State officials were glad to have the money on hand, but most of those funds — known as community development block grants — had already been targeted to local projects.

A HUD spokesman said the state could put the money toward Central Maine Power Co. and Bangor Hydro-Electric Co. Without such assistance, the two utilities will most likely pass off the exorbitant costs from the storms on to their customers through higher rates.

But giving the HUD money to the utilities would mean forgoing the other local projects for which the grants were intended. “It’s an eligible cost, and the state and localities need to decide whether they want to spend the money on [the utilities] or on any other needs,” said Dan Egner, HUD spokesman.

But Maine’s congressional delegation is working to head off that dilemma.

Pointing to the extra funding provided for relief from last year’s Midwest flooding, U.S. Sen. Susan Collins would “likely” support a congressional funding plan to provide extra dollars for Maine and other states ravaged by the ice storms, said spokeswoman Felicia Knight.

In the months following last year’s floods, Congress approved a similar bill that gave Minnesota and the Dakotas extra funding, some of which went to their local utilities to pay for rebuilding transmission facilities.

But that money did not arrive to the states until long after the floods, and got bogged down in partisan fights over unrelated amendments to the bill. The SBA option would get money to the utilities much quicker.

“It looks like a good possibility,” said Doug Dunbar, spokesman for Rep. John Baldacci, a member of the House Small Business Committee. “There is some hope in that regard.”

Dunbar said the SBA could make a decision next week on the eligibility of the utilities to receive the disaster loans, which are typically administered at a 4-percent interest rate.

Baldacci, Collins, Sen. Olympia Snowe and Rep. Tom Allen are all looking at other options for federal funding, including a possible disaster funding bill, Dunbar said. “This delegation would do whatever it could to find those resources.”

Meanwhile, in Augusta, House Speaker Elizabeth H. Mitchell Friday announced that she would seek to include funding in the supplemental budget to help cover the cost of restoring the storm-damaged power transmission system. Electric utility ratepayers should not have to shoulder the full cost of restoring the state’s power transmission system and should not be concerned about a large rate increase, she said.

“Many homeowners have contacted me greatly concerned that their electric utility rates will increase as a result of the storm. That’s not right. People whose lives are disrupted and struggling with personal hardships should not have to worry now about a rate increase,” Mitchell said.

The speaker noted that the full cost of the storm’s impact will not be known for some time, however she pledged that the Legislature would would act quickly as soon as the costs are known. Legislation to help ratepayers could be considered as an emergency act so that it takes effect immediately.

“The Legislature will work with the utility companies and federal officials to explore every possible funding source. I do not believe the full cost should be passed on to consumers as a rate increase,” said Mitchell.

“The utility companies and line workers have done a heroic job of restoring power as quickly as possible. Their first priority has been to do whatever it takes to restore power and then worry later about the finances. At a time when the state has a sizable budget surplus, there’s no reason state funds cannot help offset a portion of this cost,” the speaker concluded.

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