People like you who are interested in strengthening the resilience of our region
Let’s Get The
Program Back On Track
The Property-Assessed Clean Energy (PACE) model is a financing structure that enables local governments to raise money through the issuance of bonds, state grants or other sources of capital to fund energy efficiency and renewable energy projects. From this fund loans for renewable energy installations are then made to property owners for 15-20 year terms at very low interest making the pay-back of the system more affordable. The property owners that benefit from the improvement repay the bond through property assessments, which are secured by a property lien and paid as an addition to the property tax bill.
The program cost is born only by those property owners who voluntarily choose to attach the cost of their energy improvements to their property tax bill. When the home is sold the new owner simply inherits both the remaining repayment obligation and the financed energy improvements.
BENEFITS OF PACE TO MASSACHUSETS
Energy efficiency offers a "trifecta" of benefits to Massachusetts by putting our hard-hit construction and building industries back-to-work with green jobs, by mitigating our the carbon footprint of our communities and by delivering improved health and comfort to our homeowners. The PACE program is among the top ten measures sited by many groups nation-wide as one that can help build the economy without adding to the deficit.
Benefits to Homeowners:
Benefits to Cities and Towns:
Benefits to Our Economy:
The implementation of PACE:
PACE, adopted by over 22 states took a big step backwards when in 2010 Fannie Mae and Freddie Mac came out against the financing plan as it would put them in second place for repayment should there be a default on a home mortgage. This is because PACE loans are tied to the property as a tax lien and taxes owed to a city are recovered before the mortgage holder when in default. So Fannie Mae and Freddie Mac set up a policy where they would not loan to any property involved in a PACE program. As Fannie Mae and Freddie Mac buy/hold almost 80% of all US mortgages, this policy stopped all PACE programs in the country dead in their tracks.
Our Vermont neighbors have recently passed new legislation that works around and solves the issues Fannie Mae and Freddie Mac have with PACE financing. Vermont even took their plan beyond the financing of renewable energy projects to include energy efficiency measures to homes. The link below will lead you more details of the PACE program and how it works in Vermont: http://www.veic.org/resourcelibrary/PACE.aspx
CALL TO ACTION
Take a moment to email your local representatives asking them to look at the solutions passed by Vermont and move forward on this most important economic development, job producing, energy producing and carbon reducing legislation.
GAILANNE CARIDDI (1st Berkshire District)
PAUL MARK (2nd District)
CHRISTOPHER N. SPERANZO (3rd Berkshire District)
WILLIAM “SMITTY” PIGNATELLI (4th Berkshire District)
Benjamin Brackett Downing (Berkshire, Hampshire & Franklin)
Northern Berkshire Transition (NBT)
NBT’s mission is to inspire, encourage, connect with our community by creating and supporting initiatives that rebuild and strength our resilience to survive social, environmental
and economic difficulties, and reduce CO2 emissions.
& Facebook: Northern Berkshire Transition
Jay, this sounds great! But what if someone were to do the retrofitting to their home and then sell it before 15-20 years pass?
Maine's PACE financing approach to work around FannieMae's objections to these loans.
While this solves some issues, by making the PACE loans subordinate to the mortgage loan, these loans could compromise their municipal bond rating. It all depends on the origination of the funds use for the PACE program and the liability the town/city may incure in the process.
Below are the details of the Maine proposal.