SUPPLEMENTARY INFORMATION:

Based on a review of FY25 Quarter 3 (Q3) reports and the Carryover and Reallotment Reports (CRR), which include information on unobligated balances, ACF has determined that $2,697,089 of FY25 LIHEAP funds will be available for reallotment for FY26. In addition, $484,019.07 in IIJA funds will be reallotted. The total of the two combined is $3,181,108.07. LIHEAP recipients submitted the FY25 Q3 reports and FY25 CRRs to OCS in accordance with the requirements of 45 CFR 96.81(b).

The LIHEAP statute allows recipients who have funds unobligated at the end of the FY to request permission to carry over up to 10 percent of their full-year allotments to the next FY (42 U.S.C. 8626(b)(2)). Funds in excess of this amount must be returned to the U.S. Department of Health and Human Services and are subject to reallotment under 42 U.S.C. 8626(b)(1).

In accordance with 42 U.S.C. 8626(b)(1)(B), beginning the week of August 25, 2025, ACF began outreach to each of the 35 recipients with unobligated block grant funds above their carryover caps according to their Q3 reports and CRR, and 60 recipients that had IIJA funds about the carryover caps. Using emails and phone calls, ACF informed each recipient of the amount that, according to the recipients' reports, the recipient needed to obligate before September 30, 2025, or would need to return for de-obligation and redistribution to FY26 recipients as part of the reallotment. ACF conducted outreach the week of February 2, 2026, to finalize these reallotment amounts based on Q3 reports and CRR information.

All LIHEAP recipients who receive a portion of these funds will be notified of the final reallotment amount redistributed to them for FY26. This decision will also be published in the Federal Register .

The FY25 LIHEAP funds ACF preliminarily expects to become available for reallotment determination, come from the following recipients in the following amounts:

If funds are reallotted, then they will be allocated in accordance with 42 U.S.C. 8623 and must be treated by LIHEAP recipients that receive them as funds appropriated for FY26. As FY26 funds, they will be subject to all requirements of the LIHEAP statute, including 42 U.S.C. 8626(b)(2), which requires that a recipient obligate at least 90 percent of its total block grant allocation for a FY by the end of the FY for which the funds are appropriated; that is, by September 30, 2026. Furthermore, recipients who receive these funds may use them for any purpose authorized under LIHEAP and must add them to their total LIHEAP funds payable for FY26 to calculate statutory caps on administrative costs, carryover, Assurance 16 activities, and weatherization assistance.

Additionally, all recipients of these funds must (1) ensure that these funds are included in the amounts on Lines 1.1 of their FY26 CRRs; (2) reconcile these funds, to the extent that they received them, on their corresponding FFRs; and (3) record, on their FY26 Household Reports, households that receive benefits at least partly from these funds. State recipients must also ensure that these funds are included in the Grantee Survey sections of their FY26 LIHEAP Performance Data Forms.

Statutory Authority:42 U.S.C. 8626(b).

91 FR 16004