The Washtenaw County board of commissioners has taken another step towards creating a countywide Property Assessed Clean Energy (PACE) program by approving a notice of intent to form a PACE program.
The action took place at the board’s Jan. 8, 2014 meeting. An initial vote had been taken on Dec. 4, 2013, following about an hour of debate.
The goal of PACE is to help owners of commercial (not residential) properties pay for energy improvements by securing financing from commercial lenders and repaying the loan through voluntary special assessments.
The county’s proposal entails joining the Lean & Green Michigan coalition and contracting with Levin Energy Partners to manage the PACE program. Andy Levin, who’s spearheading the PACE program statewide through Lean & Green, attended the Dec. 4 meeting to answer questions. State Sen. Rebekah Warren also spoke briefly during public commentary on Dec. 4 to support the initiative. She was instrumental in passing the state enabling legislation to allow such programs in Michigan.
The law firm of Miller, Canfield, Paddock & Stone would act as legal counsel. Several other counties are part of Lean & Green, according to the group’s website. Other partners listed on the site include the Southeast Michigan Regional Energy Office, which was co-founded by county commissioner Conan Smith. Smith is married to Warren.
The county’s PACE program would differ from the one set up by the city of Ann Arbor, which created a loan loss pool to reduce interest rates for participating property owners by covering a portion of delinquent or defaulted payments. Washtenaw County does not plan to set up its own loan loss reserve, and no county funds would be used for the program, according to Levin.
However, a reserve fund is mentioned in documentation that describes the program:
8. Reserve Fund
In the event Washtenaw County decides to issue bonds to provide financing for a PACE Program, Washtenaw County can determine at that time to fund a bond reserve account from any legally available funds, including funds from the proceeds of bonds.
By participating in LAGM [Lean & Green Michigan], Washtenaw County assists its constituent property owners in taking advantage of any and all appropriate loan loss reserve and gap financing programs of the Michigan Economic Development Corporation (“MEDC”). Such financing mechanism can similarly be used to finance a reserve fund.
On Dec. 4, the board set a public hearing on this issue for the meeting on Jan. 22, 2014. The board would also need to take another vote to actually create the PACE district. A date for that action has not been set.
This brief was filed from the boardroom of the county administration building at 220 N. Main St. in Ann Arbor, where the board of commissioners holds its meetings. A more detailed report will follow: [link]