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PACE Legislative update


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August 5, 2010 presentation to Green Energy Ohio, Central Ohio networking group

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PACE Legislative update

  1. 1. PACE Financing Legislative Update Renewable Concepts & Design, LLC August 2010
  2. 2. Overview 2 Rapid Nationwide Adoption of PACE Districts October 2009 – Whitehouse led interagency working group HUD, NEC, CEQ, OMB, DOE, Treasury May 2010 – Release of DOE/ARRA Guidelines and Funds for PACE programs Case Study July 6th, 2010 – Regulators Block State Programs – Fannie Mae, Freddie Mac, Office of Comptroller of Currency (OCC) Current Litigation Legislation Action Renewable Concepts & Design, LLC
  3. 3. Property Assessed Clean Energy (PACE) / July 2010 ME: 2010 MN: 2010 NH: 2010 NY: 2009 OR: 2009 VT: 2009 WI: 2009 NV: 2009 OH: 2009 MD: 2009 IL: 2009 CO: 2008 DC DC: 2010 CA: 2008 VA: 2009 MO: 2010 NC: 2009 NM: 2009 OK: 2009 GA: 2010 TX: 2009 LA: 2009 23 states + DC authorize PACE FL: 2010 (22 states have passed legislation and HI: Existing Authority* HI permits it based on PACE financing authorized existing law)
  4. 4. US DOE Guidelines for PACE 4 Guidelines released on May 7, 2010 Expected Savings to Investment Ratio > 1.0 Term of Assessment should not exceed the useful life of the improvement Mortgage Holder receives notification when liens are placed PACE lien non-acceleration upon property owner’s default Renewable Concepts & Design, LLC
  5. 5. US DOE Guidelines for PACE 5 Continued Assessment should be appropriately sized – improvement value should not exceed 10% of total property value Quality Assurance and Anti-Fraud Measurements Rebates and Tax Credits Participant Education Debt Service Reserve Fund Data Collection – Performance Monitoring Renewable Concepts & Design, LLC
  6. 6. Sonoma County Energy Independence Program (SCEIP) – Case Study 6 SCEIP is our nation’s largest PACE program Operations commenced March 25, 2009 Initial available project capital $100 Million No General Fund contributions Cost neutral to County and City governments Interest rate spread over all program costs Sonoma County’s SCEIP Participants have a LOW delinquency rate Sonoma’s average tax delinquency rate is 3% SCEIP Participants delinquency rate is 1.2% Renewable Concepts & Design, LLC
  7. 7. SCEIP Case Study 7 SCEIP operations through June 30, 2010 Applications total 1,671 Applications approved 1,292 Projects complete and funded 967 Total $ funded $30,372,278 Projects in queue 347 Commercial projects 22 Projects on hold due to FHFA 10 Projects withdrawn due to FHFA 6 Renewable Concepts & Design, LLC
  8. 8. SCEIP Case Study 8 Additional Benefits of PACE: 330 new and maintained jobs per ARRA standards 7.5% increase in construction jobs per State EDD statistics 3 Mega Watts of new clean energy generation – enough for 800 homes 1900 tons of carbon reduction 74% increase in retail sales for energy efficiency products per Home Depot Includes “cool roof”, fuel cell, and other innovative projects Renewable Concepts & Design, LLC
  9. 9. July 6, 2010 Regulators Block PACE financing 9 FHFA Fannie Mae Freddie Mac OCC FDIC Renewable Concepts & Design, LLC
  10. 10. Issues brought forth: 10 States’ rights and legal precedent Ignored Safety and Soundness Guidelines established by White House & DOE Treats PACE like loan vs. assessment Questions Senior Lien Status Claims size and duration exceed typical assessments Questions “community benefit” Results in Red-lining any property in a PACE district Commercial PACE participation also scrutinized Renewable Concepts & Design, LLC
  11. 11. Litigation 11 State of California Filed suit July 14, 2010 California Energy Commission took action on July 28, 2010 to vacate $30 million ARRA grant funding for PACE programs which would have leveraged $370 million in projects. California PUC warned that the FHFA’s actions could jeopardize California’s $3.8 Billion energy efficiency program. City of Babylon, New York Filed suit July 16, 2010 Renewable Concepts & Design, LLC
  12. 12. Current Legislation 12 PACE Assessment Protection Act of 2010 Legislation would require that the underwriting standards of Fannie Mae and Freddie Mac mimic the USDOE guidelines for PACE H.R. 5766 – Introduced by Rep. Mike Thompson, cosponsored by 44 other members Committee on Financial Services Ohio Committee Members – Charles Wilson, Mary Jo Kilroy, Steve Driehaus S. 3642 – Introduced by Sen. Barbara Boxer; cosponsored by Sen. Bennett, Sen. Merkley, Sen. Begich, Sen. Udall, and Sen. Gillibrand Banking, Housing & Urban Affairs committee Ohio Committee Member – Sherrod Brown Renewable Concepts & Design, LLC
  13. 13. For more information: 13 Renewable Concepts & Design, LLC
  14. 14. Renewable Concepts & Design, LLC 14 Thank you for your time and interest. Mary Cunnyngham 614-571-4918 Russ Meeker 614-638-5641 Renewable Concepts & Design, LLC