For next winter, the authority also may try a “pilot project,” possibly in the Bath area, that the governor’s office is developing. It would go out to bid for “let’s say 20 million gallons of oil for 2000 recipients,” according to Baldacci’s energy aide Beth Nagusky. Although 2000 people represent only 4 percent of the LIHEAP recipients, the Maine Oil Dealers Association president, Jamie Py, says he expects his members to “resist” this idea, too. He intimates he will accuse state government of being “anti-small business” — a potent threat in an election year.
Oil pressure
The housing authority director and not the board has the power to make decisions on discount or bidding issues, says Raymond Richard, for 40 years head of the Kennebec County Community Action Program. The authority funnels oil money to low-income people through his and 10 other community-action agencies.
The housing authority’s chief attorney, Linda Uhl, responds that even if the law doesn’t put the power to decide such issues in the board’s hands, “basically, it’s always been done that way.”
Over the years, Richard says, he has “raised the issue” of why the agency couldn’t get more for poor people with its oil dollars, but until McCormick took over there was “never any interest whatsoever.” The authority has never been politically pressured to bargain, he suggests.
Instead, the pressure comes from the oil dealers.
At last summer’s hearing, they complained it was unfair for the authority to force a discount on them because they had already bought their oil for the winter. But Py, the oil dealers’ representative, seems opposed to any requirement that his members give discounts or submit to a bidding system for LIHEAP recipients.
“The relationship between customer and dealer is more than price,” he says, suggesting — here, too, he seems to be making a threat — that some dealers might not serve LIHEAP customers if they had to accept discounts or that chaos would result if a winning-bid company got involved in the relationship another dealer had with a customer.
Think about “your grandmother’s relationship with a dealer,” he says. “She might get a delivery on Christmas Eve.” Or she might not.
Could the dealers’ motivation in resisting discounts also be to make more money from the state? “I don’t know anybody who liked the idea” of discounts, Py answers.
McCormick, Richard, and others interested in maximizing the benefit to poor people believe oil dealers have a point when they talk about interference in customer-dealer relationships, especially in rural areas with few dealers available as alternatives.
But the housing authority has a new computer program that former authority director Michael Finnegan believes could make it easier to create “regional aggregations” of LIHEAP recipients for a discount system. Spreading the discount oil among several companies around the state could lessen concerns about the sparsely populated places.
