The first dominos are falling. The Alaska Municipal League and Alaska School Districts are pleading for support from lawmakers to help meet the shocking increase in heating oil prices this winter.
Schools, village and city infrastructure, rural utilities, public housing, hospitals, jails, airports, shelters - every facility we depend upon to support our society and our economy will have to find some way to cope with crippling heating oil expenses during the coming winter and for years to come.
Now, I am compelled to add our voice to the chorus.
For almost 20 years, the St. Vincent de Paul Society has been able to help the needy with cash rent and utility assistance payments to keep families from becoming homeless. Last year, we provided about $60,000 to local landlords and utility companies (including heating oil and propane vendors). We leverage our thrift store revenues to make this possible. On average, we spend about $500 per household to prevent homelessness. Even so, in a normal year we must turn away at least one out of three that come to us for help, just for lack of funds.
But, our first obligation is to the 70 families with children who depend on our family shelter. In addition, we are responsible for Smith Hall, a senior apartment complex that houses 25 elder households. We must keep ahead of the oil bill for these buildings. Every penny of available cash flow must first be dedicated to operating expense. What is left over we can gratefully extend to those in need.
In January 2004, we paid $1.39 per gallon for our winter heating oil. In January 2005 we paid $1.79 per gallon.
Today I received a bill for 1,059 gallons at $2.74 per gallon, almost a hundred percent increase in less than two years. If it doesn't get too cold, it will last another two weeks. Annual heating oil expense was about $20,000 in 2004. It will be at least $40,000 this year. There is only one place for us to find the funds to meet this need.
Twenty-thousand dollars more to the oil companies means there may be 40 more homeless families in Juneau this year.
That is 40 families that could face the winter on the street, in their cars or more likely doubling up with friends and relatives in substandard housing, in environments rife with abuse, violence, alcohol and other drugs. This is not just cruel; it is stupid. Social costs grow exponentially with each homeless "event." Our jails and prisons and psychiatric facilities are Alaska's largest homeless shelters. They are not cheap or cost-effective ways to deal with the problem. Children deprived of stable homes have trouble keeping up in school and are less trusting of all adults and the society we represent. We set our own social time bomb.
The phenomenal rise in heating oil cost is not something the local fuel companies can control. They are just one link in the fossil fuel food chain. Another 50 cents per gallon and electric heat may become the more cost effective method of heating our homes anyway.
Like you, I have had to explain our annual "oil money" check to friends and relatives outside. It is far more difficult to explain to low-income Alaskans how their dividend check can shrink more than 50 percent as oil prices increase by 100 percent. Needy Alaskans only know that they depend on the Alaska Permanent Fund dividend as a life preserver to get them through the winter. The poor, whether in bush villages or public housing in our cities do not spend their dividend on Mexican vacations or (sadly) on their children's future. A "very-low income" family of four in Juneau has seen their annual income shrink by 25 percent over the last four years - just from the decline in the dividend. Now the inflation monster, beginning with heating oil and gasoline, will further erode their security.
With God's help, the generosity of our donors and the patronage of our customers, we will meet our obligations. But, as usual the most seriously impacted will be those who can afford it least.
Dan Austin is the general manager of the St. Vincent de Paul Society. He helped found the Juneau Homeless Coalition, has worked for legislators from Anchorage and Fairbanks and has served in the Governor's Office of Management and Budget.