Over 1 Million Americans Could Lose Up to $996 in Benefits—Here’s How the Government Shutdown Just Made It Real
The 2025 U.S. federal government shutdown began on 1 October 2025 after Congress failed to pass full-year appropriations for the fiscal year. As a result, several federal programmes reliant on annual funding—including LIHEAP—have seen planned allocations delayed or suspended.
Over 1 Million Americans Could Lose Up to $996
| Key Fact | Detail / Statistic |
|---|---|
| Estimated at-risk households | Over 1 million U.S. households |
| Maximum benefit potentially lost | Up to $996 per household (for eligible fuel users) |
| Federal funding pending | ~US$3.6 billion in LIHEAP funds at risk due to shutdown |
| Estimated increase in energy costs this winter | ~7.6 % average rise in home-heating costs |
What’s Happening and Why It Matters
Funding Freeze Amid the Government Shutdown
According to the U.S. Department of Health and Human Services (HHS) via reporting, states could miss out on roughly US$3.6 billion in LIHEAP funds if the shutdown persists.
In the state of New York, for example, Governor Kathy Hochul announced that the HEAP programme could not begin its usual early-November intake or benefit delivery without federal funds.
Who Is Impacted and How Much They Could Lose
HEAP (and the broader LIHEAP) programmes help low-income households pay heating and cooling bills, with regular benefits and emergency benefits for households in immediate risk of fuel shut-off or shortage. Eligibility depends on income, household size, age or disability of occupants, and type of fuel used.
In New York last winter, the regular HEAP benefit maxed out at $996 for certain fuel users. (post-journal.com) Nationwide, the shutdown may leave over one million households unable to receive the benefit this season.
Many rely on home-heating oil, propane or kerosene—fuels that typically carry higher costs, especially during winter. A delay of even a few weeks can mean higher bills or colder homes.
Rising Energy Costs Amplify the Risk
The timing of the funding interruption is particularly critical. According to a report by National Energy Assistance Directors Association (NEADA) cited by Time, home-heating bills are projected to rise about 7.6 % this year.
Mark Wolfe, NEADA executive director, said:
“It takes at least four to six weeks to get the money out. … If the shutdown continues, the lives of low-income families … will just become much harder.”
Delayed benefit payments mean some households may face cold indoor temperatures or forced fuel rationing while waiting.
Broader Budget and Policy Context
The lack of funding for the heating assistance programme underscores wider fiscal and policy issues. According to the HHS estimate, the freeze in LIHEAP funding reflects the vulnerability of social-assistance programmes to federal funding gaps.
Experts note that the shutdown highlights the fragility of safety-net programmes when annual appropriations are not secured. Uma Outka, a professor at the University of Kansas specializing in energy and environmental law, commented:
“The skyrocketing demands for rate increases … are threatening higher residential prices, and energy insecurity … is only going to become a bigger problem for low income households.”
States may have limited ability to fill the gap. As Governor Hochul noted:
“With energy costs rising, struggling New Yorkers will be left with stark choices on how to allocate their household budget while trying to stay warm this winter.”
What States Are Doing and What Their Options Are
Some states are preparing contingency plans. For instance, in Massachusetts the LIHEAP programme is restricting most new applications to emergency cases only.
However, state budgets are already under strain, and reallocating funds to cover the heating assistance gap could mean cuts elsewhere. Utilities in some states have been urged to halt service shut-offs until federal funds are restored.
Human and Economic Consequences
The shutdown’s impact on heating and energy assistance has both immediate and cascading effects. For households, missing a one-time benefit of up to $996 can mean choosing between paying for heat and paying for food or medical care. Analysts warn of increased demand at food banks, community services and local shelters as families navigate these trade-offs.
From an economic perspective, delayed payments may also ripple through utility providers and local economies. A large number of unpaid bills may increase pressure on municipal welfare systems.
What You Can Do If You’re Affected
- Contact your state HEAP/LIHEAP office immediately to check the status of your benefit application or payment.
- Maintain records of your fuel use, household income, prior benefit status and any correspondence regarding benefit delays.
- Budget for higher heating costs this winter in case the benefit is delayed or cancelled.
- Explore other local relief programmes or charitable heating-fuel assistance. Local community agencies may have emergency funds even when federal programmes are paused.
- Stay informed about updates from your state’s social-services agency. Some states may offer retroactive payments once funding resumes, but waiting can cause hardship in the meantime.
What Happens Next?
Much depends on when Congress acts to restore full federal funding or passes a continuing resolution that covers the programmes. Until then, the clock is ticking for states to secure funds and get payments out in time for the cold-weather season.
As the temperature drops and payment delays grow, low-income households face higher stakes—and the burden of the shutdown moves from abstract politics into living rooms and utility bills.
