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Tue, Feb 06, 2001 EST
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Soaring Energy Costs Taking a Toll on Hospital, Churches and Other Services
By Dee-Ann Durbin   Associated Press
LANSING, Mich. — Soaring energy bills are eating deeply into the budgets of schools, hospitals, churches and homeless shelters across the country, forcing them to look for increasingly hard-to-find ways to tighten their belts.

"It will come out of the hides, so to speak, of the kids," says Don Tharpe of the Association of School Business Officials. Unlike businesses, he notes, schools can't raise the prices on their product to make up for higher costs.

Many hospitals need to pass their heating costs along to patients, although that's not always possible because hospitals get fixed reimbursements from Medicaid and Medicare for many patients, said George Quinn, a spokesman for the Wisconsin Health and Hospital Association.

"If your costs go above what you budgeted, you aren't able to recoup that from government payers, so there will be some passing along to patients who can pay," he said. "It has to come from somewhere."

Gas companies blame the prices they are charging on the cost of wholesale natural gas, which has quadrupled over the last year. High demand intensified by cold weather has contributed to the problem. The leap in natural gas prices coupled with a shortage of hydroelectric power in the Northwest also has contributed to California's energy crisis.

The high price of energy doesn't leave much to go around for anyone.

"Just today, someone told me a chair broke, but we're not going to go out and buy another chair. We just can't be spending money on things like that," said David Williams, operations director at the Michigan Humane Society, whose cost to keep animal shelters warm is approaching $4,600 a month.

There are blankets on the pews for worshippers at Dimondale United Methodist Church near Lansing. Like many churches, Dimondale heats the sanctuary only for services. But it still pays $600 per month for heat, Pastor Lillian French said.

"That's $600 out of an already tight ministry," she said.

Lansing's Sparrow Hospital will spend an estimated $140,805 on January's heating bill, up from $32,940 in January 2000, spokeswoman Lorri Rishar said.

The hospital has few ways to trim that bill, Rishar says. Specialized areas such as nurseries must be kept at higher temperatures, for example.

So far, the hospital is absorbing the cost with emergency funds and hasn't had to pass it along to patients, Rishar says.

"We're just hoping it warms up the rest of the winter," she added.

Abbott Northwestern Hospital in Minneapolis paid $71,000 for natural gas heat last January, said Bob Hallman, maintenance manager for the 580-bed hospital. This January, he said, the hospital switched to its backup oil heating system and saved about $120,000 — but will still pay nearly $140,000 for heat.

"I don't know that anybody saw it coming. I certainly didn't budget for these types of dollars," Hallman said.

Schools also need to maintain a warm environment.

Just north of the Colorado-New Mexico state line, Trinidad's School District 1 says it may have to cut student programs. This winter's heating bills are $25,000 to $30,000 higher per month than the budget for the 1,600-student district allowed, Superintendent David VanSant said.

Many homeless shelters in Massachusetts are limiting food and other basic provisions because heating costs are so high, said Philip Mangano, executive director of the 75-member Massachusetts Housing and Shelter Alliance.

Heat just isn't one of the things that can be sacrificed, Mangano said.

"For very vulnerable people, the feeling of safety and security is often tied up with the notion of warmth," he said. "Keeping the environment warm for the temporarily lodged is a very important part of the service that's provided."

Sister Connie Driscoll knows that all too well. She leads the Chicago Task Force on Homelessness and runs a shelter for 120 women and children on the city's South Side. She has paid a fixed price for heat under an agreement with her local parish, but already has been warned that the price will skyrocket when she renegotiates this summer.

"We're all sitting on pins and needles wondering what's going to hit us," she said.

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