Mitchell-Lama Co-op Escapes a Heating Bill Nightmare

After what Goldfinger describes as a simple application process, residents were soon receiving discounted oil, a total grant that was equivalent to roughly a $30,000 savings.

“Heating is never a line item off the budget,” says Goldfinger, explaining how the heating grant directly affected residents. “Our cooperators here are basically low-income residents and you need to be low-income to live here. Because of the energy we’ve been consuming for the past two years, especially the winter of 2013, we had to have an equity increase in order to pay our fuel consumption bills.”

The grant Contello Towers 2 received was the result of a partnership between CITGO, a wholly owned subsidiary of a Venezuelan state-owned oil company, and Citizens Energy, a charitable arm of an energy company founded and chaired by Joseph P. Kennedy II, the son of Senator Robert Kennedy and a former democratic representative for Massachusetts.

Citizens Energy signed a supply agreement with Venezuela in 1979 with Kennedy then contracting hundreds of retailers to deliver heavily discounted oil to needy families across Massachusetts. The program spread nationally with local partners, including the Urban Homesteading Assistance Board in New York.

The program offers grants of 50 gallons of heating oil per apartment to eligible buildings. Co-ops under the umbrella of the Housing Development Fund Corporation qualify – as do many co-ops in the Mitchell-Lama program.

The grants require a commitment from building management to return up to 67.5 percent of oil savings as rent credits to residents and reinvest the remainder of savings in energy-efficient building upgrades.

Citizens Energy offers several grant programs for heating oil depending on the recipient — for single-family homes and for entire multi-unit buildings. Applications can be made via several partner agencies across the country or directly with Citizens Energy.

Residents at Contello Towers 2, a co-op constructed and managed under the Mitchell-Lama program that caters to moderate- and middle-income families, saw instant financial benefits from the CITGO/Citizens Energy grant.

The building had been hit hard by heating bills during past winters and residents with limited means were feeling financial pressure. One of the first agenda items for New Bedford Management Corp. when it was appointed property manager last January was to apply for the grant.

“Those winters meant our board had to make a fuel and energy pass-along to residents of anywhere between $50 and $60 per month per apartment,” says Goldfinger. “That left many people quite strapped and struggling to pay the rent. With this grant they may have got back up to $150 per unit. This is a big savings to many of them. Believe me — they need the money.”