Proposed Reallotment of Fiscal Year 2025 LIHEAP Funds to Eligible Recipients
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The Administration for Children and Families, Office of Community Services (ACF OCS) has issued a preliminary determination that unspent Low Income Home Energy Assistance Program (LIHEAP) funds from fiscal year 2025 are available for reallocation. This includes both FY25 annual LIHEAP funds and FY24 and FY25 funds appropriated under the Infrastructure Investment and Jobs Act (IIJA) that eligible recipients were unable to obligate or carry forward into FY26. The reallotment process allows these unused federal funds to be redistributed to states, territories, federally recognized tribes, and tribal organizations that received direct FY26 LIHEAP awards. This ensures that energy assistance funding intended for low-income households does not go unspent but is redirected to recipients capable of deploying it. Importantly, only direct FY26 LIHEAP award recipients are eligible to apply for these reallocated funds. Subrecipients of those entities — such as local agencies or nonprofits that receive LIHEAP funds through a state or tribe — are explicitly excluded from applying. This restricts the pool of eligible applicants to primary grant holders only.
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Key Changes
- ACF OCS issues preliminary determination that unobligated FY25 LIHEAP annual funds are available for reallotment
- FY24 and FY25 Infrastructure Investment and Jobs Act (IIJA) LIHEAP funds that could not be carried over are included in the reallotment pool
- Eligible applicants restricted exclusively to entities that received direct FY26 LIHEAP awards (states, territories, tribes, tribal organizations)
+ 3 more changes with Pro
Obligations
What this law requires
Only direct FY26 LIHEAP award recipients may apply for reallocated FY25 and IIJA funds; subrecipients and other entities are prohibited from submitting applications
ACF OCS must make a final determination regarding availability of unspent FY25 LIHEAP funds for reallocation based on preliminary determination findings
Eligible recipients must identify and report unobligated or uncarried-forward FY24 and FY25 IIJA appropriated funds that are available for reallocation
Reallocated funds must be distributed only to direct FY26 LIHEAP award recipients, excluding any pass-through or downstream recipients
Applicant entities must demonstrate capability to obligate and deploy reallocated energy assistance funds to eligible low-income households