HomeMy WebLinkAboutHERO/CALIFORNIA First Property Assessed Clean Energy Information Item
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INFORMATION ITEM
TO: HONORABLE CHAIRPERSON AND MEMBERS OF T SA UTILITY
BOARD
FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIES
DATE: SEPTEMBER 28, 2015
SUBJECT: HERO/CALIFORNIAFIRST PROPERTY ASSESSED CLEAN ENERGY
(PACE)PROGRAMS UPDATE
The City of Azusa is currently providing two thoroughly vetted PACE financing options to
Azusa property owners when financing permanently fixed renewable energy, energy and water
efficiency improvements, and electric vehicle charging infrastructure for residential and
commercial buildings within the community.
On July 21, 2008, Assembly Bill (AB) 811 was signed into law authorizing California cities and
counties the ability to allow willing property owners to enter into contractual assessments to
finance the installation of distributed renewable energy generation, as well as energy efficiency
improvements for residential, commercial and industrial property owners. On February 24, 2009,
AB 474 authorized water conservation improvements to be added to the improvements.
Financing these improvements has come to be known as Property Assessed Clean Energy
(PACE) financing.
On October 5, 2011, Senate Bill (SB) 555 was signed into law and amended the Mello-Roos
Community Facilities Act, set forth in sections 53311 through 53368.3 of the California
Government Code and created a second legislative framework for PACE financing. SB 555
allows for the creation of Community Facilities Districts ("CFDs") for the purpose of financing
or refinancing the acquisition, installation, and improvement of energy efficiency, water
conservation, renewable energy and electric vehicle charging infrastructure improvements
permanently affixed to private or publicly-owned real property.
Both the AB 811 and SB 555 legislation frameworks were developed to make renewable energy,
energy efficiency, water conservation and electric vehicle charging infrastructure improvements
more affordable and promote the installation of those improvements. PACE financing allows
residential and commercial property owners to finance 100% of the cost of eligible
improvements, such as solar energy systems, Energy Star windows and doors, and high-
efficiency air conditioning units, and water efficiency through as assessment on the property that
is paid over time through property taxes. Participation in any of these financing programs is
voluntary and only those property owners who wish to participate in these programs will repay
the loan as an assessment or special tax on their property tax bill. It is the responsibility of the
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HERO/CaliforniaFIRST PACE Programs Update
September 28,2015
Page 2
property owners to perform their due diligence and read all contractual documentation regarding
any company they select to provide them financing.
On July 22, 2013, the City of Azusa adopted a resolution authorizing the constituents of the City
to participate in the California HERO Program through the Western Riverside Council of
Governments (WRCOG). The HERO Program enabled property owners to finance permanently
fixed renewable energy, energy and water efficiency improvements, and electric vehicle
charging infrastructure, on their properties.
On March 3, 2015 the Los Angeles Board of Supervisors (BOS) passed a resolution approving
Los Angeles County to become the bond issuer for the Los Angeles County Energy Program
(LACEP). As part of the approval process, the BOS and Los Angeles County Staff wanted
assurance that there were as many viable options available to the constituents throughout Los
Angeles as possible. To accomplish this, the County of Los Angeles went through a very intense
and all-encompassing RFP process and they determined the HERO and CaliforniaFIRST
Programs are the only PACE providers that could qualify under their criteria and are the only
two providers that are registered with CAETFA (The State Reserve Fund).
On April 27, 2015 the City of Azusa adopted a resolution allowing the continuation of the HERO
PACE Program within Azusa when Los Angeles County became the Bond Issuer for all cities
that previously approved the Los Angeles County Energy Program (LACEP) and to allow the
CaliforniaFIRST PACE to provide financing as an additional alternative to the HERO Program.
Based on the current statistics provided by the HERO Program, seven contractors have installed
two water products resulting in about 42,000 gallons of water saved each year, four Solar PV
systems with a combined installed capacity of 18 kW and 108 energy efficiency products
resulting in an estimated annual savings of nearly 320,000 kWh. Since inception, of the total
9,215 properties in Azusa, 185 applications have been submitted for PACE financing through the
HERO Program. Of the submitted applications, 127 have been approved for funding in the
amount of$7,144,280, 83 projects have been approved for a total of$815,467 and 64 projects
have been completed and funded in the amount of$1,312,139.
There are other PACE financing providers, however Staff feels HERO and CaliforniaFIRST
are setting the standards in protecting the consumers from contractors through extensive training
and policing of the contractors. The key components in determining future PACE providers for
the City of Azusa, are the ability to provide consistent funding and processing of projects and
being able to create a standard or meet the existing standards for Consumer Protections.
As a result, Staff is not recommending any additional PACE providers at this time, but will
continue to monitor the PACE marketplace.
Prepared by: Paul Reid,Utility Programs Specialist
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