energy assistance

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FFY2013 EAP Annual Training Part 2 DOC
Internal Controls Director Crisis
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2012 EAP Annual TrainingInternal Controls
Presentation

• Of 15

Sheldon Klugman Internal Controls
Director Minnesota Department of Commerce August
15, 2012
3
Who are you?

• New hire to the Department of Commerce in April
  2011
• Report to Deputy Commissioner Steve Carlson
• Prior State experience Department of
  Administration Management Analysis Unit
• Prior private sector experience Compliance
  Director Ameriprise Financial (IDS)

4
Who are you?

• New hire to the Department of Commerce in April
  2011
• Report to Deputy Commissioner Steve Carlson
• Prior State experience Department of
  Administration Management Analysis Unit
• Prior private sector experience Compliance
  Director Ameriprise Financial (IDS)

5
What Do You Do?

• Work with Commerce leaders on designing
  strategies for integrating internal controls into
  business functions
• Work with staff members on implementing tactics
  for detecting and preventing control gaps
• Develop corrective action plans when controls
  gaps are identified
• Represent Commerce in state-wide control
  activities such as MMBs Internal Auditors
  Roundtable, MN.ITs Disaster Recovery, and the
  OLAs audit process

6
Why Do You Do It?

• Commissioner Rothmans commitment to highest
  standards of controls and integrity
• Prevent fraud, waste and abuse of State financial
  resources
• Safeguard and prevent misuse of sensitive State
  information
• Protect physical assets
• Comply with laws, regulations and state-wide
  policies
• Receive favorable feedback from OLA
• Maintain a positive reputation for the Department
  

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How Do You Do It?

• Risk Assessments (MMB Controls Assessment)
• Technical consulting
• Training (Information Security Awareness)
• Documentation (policies and procedures)
• Testing (emergency contacts, remote access)
• Process improvement (e.g., penalty collection)

8
Contact Information

• Sheldon Klugman
• Internal Controls Director
• Minnesota Department of Commerce
• Phone [phone]
• Sheldon.Klugman_at_state.mn.us

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• Q A

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FY13 Crisis Program

• Intentions
• Implement FFY13 Crisis policies and procedures
• By (Agenda)
• Spiraling from overview to details
• Explaining why how the change occurred
• Reviewing key concepts needed to understand
  details
• Explaining details of new chapter and eHEAT

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Why FFY13 Crisis Program

• Impetus for changes
• FFY12 there were considerable changes to Crisis
• Driven by funding reduction issues
• Focus became keeping heat on - households have
  heat during the winter to the extent possible
  with limited funding
• Enough changed last year EACA and DOC requested
  JAD to detail and refine Crisis program
• SMEs agreed FFY13 funding likely low again
• OLA, findings, GAO improve program integrity also
  a driver

12
How FFY13 Crisis Program

• Process for development
• October 2011 engaged SME in JAD to adjust FFY12
  Crisis program due to lower funding (SME
  subject matter expert, JAD joint approach to
  development)
• March 2012 EACA recommended Crisis JAD
• May 2012 had 4 days of JADs with 11 SME to
  explore, assess and determine candidate
  specifications.
• During after JAD, grappled with iterated
  concepts
• DOC took SME input and designed Crisis policies -
  the devil was in the details (as always)
• June July continued to iterate with SMEs and
  state staff

13
How FFY13 Crisis Program

• JAD Subject Matter Experts (SME)

• Stacy Draper
• Catherine Fair
• Richard Fuchs
• Mary Heilman
• Marla Lodermeier
• Joan Markon
• Tammy Stauffer
• Judy Steinke
• Pam Wild
• Phil Wold
• Scott Zemke

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How FY13 Crisis Program

• How the conversation went
• Not everyone agrees on everything ever
• Agreed important to reserve Crisis funds
• Guessing game to plan for resource allocation
  (SMEs estimated FY13 apps ranged from 173,500 to
  127,900)
• When JADing new ideas emerged
• Detailed ways to improve verification and
  documentation, particularly use of new eHEAT
  screens
• More details to verify and record DOC SME see
  it as necessary for program integrity
• Attempt was to design effective policies
  technical solutions

15
Policy eHEAT Overview

• High level list of policy changes
• Fundamental change PH first to address
  emergencies
• Allow Crisis for non-heat electric
• Coping with over 20 Crisis delivery mistakes
• 24/7 phone coverage
• Avoid self-supplied biofuel direct payments
• Verification and documentation requirements

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Policy eHEAT Overview

• Crisis Reasons Changed
• How and Why SME explored reasons during JAD.
  This expertise helped refine reasons
• Some were combined
• Others renamed for clarity, but are not new
  reasons
• Now serve non-heat electric Crisis households
• Eviction-related not needed b/c of non-heat
  electric
• Less variation in SP use of reasons - more
  consistent

17
Policy eHEAT Overview

• Balancing policy and implementation
• Improving controls implementing efficient
  procedures is a challenging balancing act
• For example, improved verification and
  documentation is required, but improved eHEAT
  functionality makes this less cumbersome
• An improvement the Crisis worksheet has been
  eliminated all information will be entered
  directly into eHEAT

18
Primary Heat First Concept

• Intention
• Illustrate key concepts needed to understand
  policy details
• by
• Explaining Primary Heat first concept
• Explaining key ideas
• Illustrating with pictures

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Primary Heat First Concept

• Primary Heat first Understanding
• PH to address emergencies is key FFY13 change
• There are several ways it could be applied
• Options have been debated extensively
• Believe the selected policy best meets EAP
  intentions and is the most effective and
  efficient
• Essential to understand Primary Heat first to
  learn policies and procedures

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Primary Heat First Concept

• Values
• Keep heat on
• Reserve Crisis funds
• Reduce likelihood of credits
• Treat households fairly
• Consistent procedures
• Efficiency
• Prudence in handling households individual
  situation

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Primary Heat First Concept

• Key Ideas Primary Heat first
• One Crisis event to one vendor
• Maximum of four Crisis events
• Terminology change
• Emergency is defined as any EAP Crisis reason
  new language throughout Crisis chapter
• Crisis means the benefit (no longer EB)

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Primary Heat First Concept

• Primary Heat first Steps
• Process PH as application designates
• PH benefit split to heat electric non-heat
  (i.e. 30)
• Improper manipulation of designations can result
  in a finding
• Then process the emergency - PH payments are
  applied based on how they were designated by the
  HH
• Each event is for a single vendor
• When determining benefit, available Payable PH
  for the vendor
• If PH not enough, Crisis benefit is calculated to
  address the remainder

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Policy eHEAT Overview

• eHEAT Functionality Sneak Peak
• A quick look (not detailed) at 3 new eHEAT
  functions
• New Crisis screens appear when a Crisis reason is
  selected, with details specific to the reason
• New Determine Benefit button uses details to
  calculate Crisis benefit amount
• Can disallow payment scheduling

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Primary Heat First Concept

• FPO New Crisis Screen by Reason Determines
  Benefit

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• Disallow Scheduled Payments

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Primary Heat First Concept

• Illustration of Primary Heat first concept
• Key Codes
• V1 The vendor with whom the HH has the
  emergency
• V2 Other vendor with a PH benefit distribution
  as designated by the application process

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Primary Heat first concept
A. Emergency is more than PH
V1
Emergency 552 PH 400 Crisis ?

• Specifics
• PH payments must be Payable (if Certifiable
  this is an error)
• Enter emergency info on Crisis Event screen
• eHEAT calculates using info and available Payable
  PH
• Notify HH as needed

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Primary Heat first concept
B. Emergency more than V1 PH max Crisis
V1
V2
66

• Specifics
• Keep designation as app processed
• eHEAT calculates
• Work with HH on available payment moves
  (document)
• Notify as needed
• Rescheduling remaining V2 payments is optional
  (use prudence)

PH 150 (V2)
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Primary Heat first concept
C. Emergency vendor has no PH designated or
available
V1
V2
155

• Specifics
• V1 PH gone or no 30 designated
• Work with HH on moves
• eHEAT calculates
• Notify as needed
• Reschedule remaining V2 payments is optional (use
  prudence)

PH 300 (V2)
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Primary Heat first concept
D. Emergency vendor has enough PH
V1
Emergency 332 PH 400 Crisis ?
0

• Specifics
• Enter Crisis event
• 0 event does not count as 1 of 4 events
• Collapse payments to make 332 payment
• Measures how many emergencies addressed by EAP
  funds

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Primary Heat first concept

• Primary Heat First QA

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Crisis Chapter Overview

• New Crisis Chapter
• All new and improved
• Policies reflect decisions
• Chapter Contents
• Crisis Intentions
• Crisis Eligibility Requirements
• Crisis Benefit Determination and Distribution
• Crisis Implementation
• Processing Events by Crisis Reason

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Crisis Chapter Overview

• Crisis Eligibility Requirements (pg 2)
• Requirements for household to receive Crisis
  benefit
• Household requested assistance by submitting a
  bill/disconnect notice/disconnection document or
  by notifying SP of energy emergency
• EAP eligible
• Received a PH benefit that did not resolve the
  emergency

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Crisis Chapter Overview

• Crisis Eligibility Requirements (pg 2)
• Requirements to receive Crisis benefit
  (continued)
• Have emergency situation verified documented by
  SP with energy vendor at time Crisis benefit is
  determined
• Be currently living in the dwelling at the time
  Crisis is requested and the benefit is determined
• No redundant heating system with fuel

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Crisis Chapter Overview

• Crisis Eligibility Requirements (pg 2)
• Requirements to receive Crisis benefit
  (continued)
• Have one of the seven Crisis reasons
• Heat Related Shut Off
• Heat Related Disconnection Notice
• Less than 20 in Fuel Tank and Refusal to Deliver
  (RTD)
• Less than One Week Biofuel
• Non-Heat Electric Shut Off
• Non-Heat Electric Disconnection Notice
• Senior Past Due or Current Energy Bill

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Crisis Chapter Overview

• Assurance 16 and Crisis (pg 3)
• A16 integral part of delivering Crisis
• Determining best course to address emergencies -
  essential to work with households on their
  particular needs and preferences
• SP applies program rules based on particular
  situation
• Crisis often requires referral to other resources
  and advocacy
• A16 is used to get CWR protection
• A16 is used to promote household payment
  responsibility
• EAP employs a Coordinated Responsibility Model -
  HHs, vendors, and EAP all have role in assuring
  heat for low-income households during the winter

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Crisis Chapter Overview

• Crisis Benefit Determination Distribution (pg
  4)
• Allowable Crisis expenditures
• Arrearage and current bill
• Delivered fuels or emergency fuel
• Energy-related fees such as pressure tests, leak
  seek, line bleeding, tank setting, tank rental,
  membership, after hours delivery costs,
  reconnection and service deposits
• Removal of load limiters

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Crisis Chapter Overview

• Crisis Benefit Determination Distribution (pg
  4)
• Amount of Crisis Benefit
• Crisis benefit is amount needed to resolve the
  emergency and the current amount due - up to 500
• Available PH funds are applied first before
  calculating Crisis benefit amount
• If the emergency is not resolved after the
  available PH benefit is applied, the HH is
  eligible for a Crisis benefit
• No credit can be generated by a Crisis payment

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Crisis Chapter Overview

• Crisis Benefit Determination Distribution (pg
  4)
• Amount of Crisis Benefit (cont.)
• For delivered fuels, the Crisis benefit amount is
  the amount needed for a minimum delivery plus any
  current balance
• The self-supplied biofuel direct payment amount
  is 250

40
Crisis Chapter Overview

• Crisis Benefit Determination Distribution (pg
  4)
• Distribution Requirements for Crisis Benefit
• Prior to approving Crisis, must verify and
  document
• Available PH payment must be in Payable status
  to be used in the calculation of Crisis (make
  Certifiable payments Payable)
• One Crisis event to one vendor
• Maximum four Crisis events
• When determining Crisis benefit, entered account
  balance must not be older than 7 days
• No direct payments for self-supplied biofuel,
  unless no biofuel vendor available

41
Crisis Chapter Overview

• Crisis Benefit Determination Distribution (pg
  4)
• Distribution Requirements for Crisis Benefit
  (cont)
• Crisis funds can be used to reduce HH balance
  even if payment does not resolve the emergency
• If HH has both heat and non-heat vendor
  emergencies, priority is to maintain or restore
  heat
• Follow Crisis timelines even when PH addresses
  the emergency
• After using pending PH payments to address
  emergency, can reschedule remaining PH if it is
  substantial

42
Crisis Chapter Overview

• Crisis Implementation (pg 6)
• Response timelines
• Life-threatening situation
• HH has no heat or no heat distribution
• Must receive the highest service level within
  18 hours after request
• Not immediately life threatening
• Examples HH is scheduled for a shut-off or has
  less than 20 of the tank fuel capacity
  remaining.
• Must provide assistance within 48 hours after
  request
• Vendor can do crisis fill during regular route if
  HH has enough fuel remaining
• HH member age 60 or older and not shut off or in
  danger of being shut off
• HH unable to pay past due and/or current energy
  bill
• Not subject to 18/48 timeline can be served in
  normal priority/delivery order

Increasing national focus on states meeting
response times. As required by federal law and
the EAP contract.
43
Crisis Chapter Overview

• Crisis Implementation (pg 6)
• 24/7 accessibility Oct 1 to Apr 15
• HHs must be able to access Crisis assistance 24
  hours a day, seven days a week from October 1
  through April 15
• SPs must have a 24-hour emergency number
• SP staff must be available to address a
  life-threatening situation within 18 hours
• Corresponds with health safety heating season
  timeline

44
Crisis Chapter Overview

• Crisis Implementation (pg 6)
• Process to reduce ineligible Crisis deliveries
• SPs had issues with tanks being over 20
• Process intended to reduce the delivery of fuel
  when HH reporting energy emergency mistakenly has
  more than 20 fuel in tank
• There is leeway for fuel delivery if delivery
  truck goes out and HH tank is between 20 and 30
  full

45
Crisis Chapter Overview

• Crisis Implementation (pg 6-7)
• Process to reduce ineligible Crisis deliveries
  (cont.)
• When SP gets call from HH reporting less than 20
  fuel, SP must
• Tell HH to make every effort to get an accurate
  tank reading. Suggest friend or neighbor read
  gauge if HH is unable to do so themselves.
• Confirm with energy vendor the HH tank size, date
  amount of HHs last fuel delivery to assess
  reasonableness of delivery need
• Notify both HH energy vendor that if fuel truck
  goes out tank is over 30
• No fuel will be put into the tank
• Trip charge will be put on HH account
• SP will use HH Crisis funds to pay vendor trip
  charge
• If delivery to HH with tank over 30, funds
  recovery process occurs

46
Crisis Chapter Overview

• Crisis Implementation (pg 7)
• Verification and Documentation
• HH Crisis event must be entered into eHEAT
• Each Crisis event makes a payment to one vendor
• HH needing Crisis assistance with two energy
  vendors requires two Crisis events
• HH allowed four Crisis events per program year

47
Crisis Chapter Overview

• Crisis Implementation (pg 7)
• Verification and Documentation (continued)
• SP must document energy vendor verification of
  Crisis. Following must be entered in eHEAT for
  each Crisis event
• Crisis reason
• Current balance owed
• Date of verification with energy vendor
• How verified with energy vendor (phone, fax, etc)
  
• Name of verifying energy vendor employee (if
  applicable)

48
Crisis Chapter Overview

• Crisis Implementation (pg 7)
• Verification and Documentation (cont.)
• Also, Crisis-related documentation should be
  saved in HH file (if not saved in eHEAT)
  including
• Copy of bill, disconnect notice or disconnection
  document
• Reasonable Payment Worksheet (for seniors only)
• Energy vendor Crisis verification documents, such
  as
• Copy of email
• Printout from portal
• Copy of fax
• Delivery ticket

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Crisis Policy eHEAT by Reason

• Processing Events by Crisis Reason (pg 7-10)
• eHEAT screens by Crisis reason
• Specific fields for each reason

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Crisis Policy eHEAT by Reason

• Heat Related Shut Off (pg 8)
• This is a life-threatening no-heat situation and
  the threat to life must be removed within 18
  hours of HH request (when funds are available)
• Verification Requirements. The following
  information must be verified with the energy
  vendor and entered into eHEAT
• Energy account balance
• Fees not included in energy account balance, if
  any
• Date shut off

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Crisis Policy eHEAT by Reason

• New Crisis Benefit Screens Walkthrough

One event for one vendor
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• Heat Related Shut Off

Failed Payment Plan
12/17/12 From Fred Smith (GasCo) Sent Dec. 17,
2012 114 PM To SP App processor Subject HH
11111111  Confirmed 326 arrearage amount
Disconnection date was 10/2/12 - JM

• Specifics
• PH Payments must be Payable
• Enter Emergency Info
• eHEAT calculates using info available Payable
  PH when Determine Benefit
• Current balance and fees are added together do
  not double enter

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Crisis Policy eHEAT by Reason

• Heat Related Disconnection Notice (pg 8)
• HH has a notice of energy disconnection
• Includes heat-related electric disconnection
  notices
• Verification Requirements. The following
  information must be verified with the energy
  vendor and entered into eHEAT
• Energy account balance
• Fees not included in energy account balance, if
  any
• Scheduled disconnection date

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• Heat Related Disconnection Notice

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Crisis Policy eHEAT by Reason

• Less than 20 in Fuel Tank and RTD (pg 8)
• HH has insufficient PH funds for a delivery, has
  less than 20 of fuel tank capacity in their tank
  and is on a cash basis with energy vendor
• An empty fuel tank is a life-threatening no-heat
  situation and requires threat to life be removed
  within 18 hours of HH request
• Pre-Delivery Verification Requirements - verify
  with the household
• Percentage of fuel remaining in tank
• Household is unable to pay

56
Crisis Policy eHEAT by Reason

• Less than 20 in Fuel Tank and RTD (cont.)
• Pre-Delivery Verification Requirements verify
  with energy vendor

• Minimum delivery
• Account balance
• Fees not included in balance
• Last delivery date
• Amount of last delivery
• Tank size
• Estimated fuel remaining
• Refusal to deliver
• Annual consumption
• If the tank is empty (the empty tank check box
  must be selected in eHEAT)

Reason for the Pre-Delivery Verification Verifyin
g this information helps ensure the delivery is
needed and reduces ineligible Crisis deliveries
57
Crisis Policy eHEAT by Reason

• Less than 20 in Fuel Tank and RTD (cont.)
• Post-Delivery Verification Requirements
• After every Crisis delivery SP must obtain from
  energy vendor verified delivery details
• Verification can occur before or after payment is
  made
• Proof of delivery can be a delivery ticket,
  email, phone call or fax
• Ensures the Crisis delivery was completed and met
  the 20 rule

58
Crisis Policy eHEAT by Reason

• Less than 20 in Fuel Tank and RTD (cont.)
• Post-Delivery Verification Requirements
  (continued)
• The information confirmed and entered into eHEAT
  includes the
• Percentage of fuel in tank before fuel delivery
• Date delivered
• Number of gallons delivered
• Price per gallon
• Dollar amount of delivery

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• Less than 20 in Fuel Tank and RTD

Propane Oil Company

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Crisis Policy eHEAT by Reason

• Less than One Week Biofuel (pg 9)
• Based on SP HH reasonable estimate of less than
  1 week of fuel left
• Avoid Crisis Payments for Self-Supplied Biofuel
• Crisis payments for biofuel must go to a biofuel
  vendor when possible
• SP must maintain relationships and agreements
  with the biofuel vendors in their service area
• Self-supplied biofuel direct payments only when
  no vendor available
• SP must document there is no biofuel vendor
  available in the eHEAT Crisis or Completion
  screen notes

Reason for this new policy Direct payments are
one of the highest risks in the program
requires documentation direct payments will be
monitored more closely
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Crisis Policy eHEAT by Reason

• Less than One Week Biofuel (cont.)
• Pre-Delivery Verification Requirements.
• Must verify with household and enter into eHEAT
• Number of days of biofuel remaining
• Must verify with biofuel vendor and enter into
  eHEAT
• Type of biofuel
• Minimum delivery
• Last delivery date
• Amount of biofuel last delivered
• Annual consumption (units)

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Crisis Policy eHEAT by Reason

• Less than One Week Biofuel (cont.)
• Post-Delivery Verification Requirements
• After every Crisis delivery the SP must obtain
  verified delivery details from energy vendors or
  households with direct payments. Verification can
  occur before or after payment is made. The
  following must be confirmed
• Date delivered
• Amount of biofuel delivered
• Dollar amount of delivery
• For energy vendors, proof of delivery can be in
  the form of a delivery ticket, email, phone call
  or fax. Households with direct payments must send
  a copy of their receipt.

63

• Less than One Week Biofuel

Corn Wood Company

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Crisis Policy eHEAT by Reason

• Non-Heat Electric Shut Off (pg 10)
• HHs non-heat related electricity is currently
  shut off
• Verification Requirements. Verify with energy
  vendor and enter into eHEAT
• Energy account balance
• Fees not included in energy account balance, if
  any
• Date shut off

65

• Non-Heat Electric Shut Off

66
Crisis Policy eHEAT by Reason

• Non-Heat Electric Disconnection Notice (pg 10)
• HH has notice of non-heat related electric
  disconnection
• Verification Requirements. Verify with energy
  vendor and enter into eHEAT
• Energy account balance
• Fees not included in energy account balance, if
  any
• Scheduled disconnection date

67

• Non-Heat Electric Disconnection Notice

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Crisis Policy eHEAT by Reason

• Senior Past Due or Current Energy Bill (pg 10)
• At least one HH member age 60 or older
• HH has a past-due and/or current bill and is
  unable to pay as determined by the RPW
• Unable to pay means the RPW indicates HHs
  available funds are less than past-due and/or
  current bill
• Verification Requirements
• Must verify with household and enter into eHEAT
• Unable to pay using the RPW
• Must verify with energy vendor and enter into
  eHEAT
• Energy account balance

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• Senior Past Due or Current Energy Bill

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Policy eHEAT Overview

• Others
• A Crisis event may get 0 Crisis benefit (if PH
  addresses the emergency) doesnt count toward
  the four events
• New Application question HHD indicates emergency
• New eHEAT checkbox indicates emergencies and is
  searchable
• Crisis letter may need change - will work with
  SME
• When PH is used to address Crisis, SP collapses
  schedules and sends payments as needed

71
Crisis Policy Procedure

• QA