There are many initiatives toward trying to make our world a more livable one. Among them we found PACE (Property Assessed Clean Energy) which can help homeowners to transform their properties into a more efficient and environmental friendly place.
What is PACE?
A Property Assessed Clean Energy (PACE) bond is a bond where the proceeds are provided to commercial and residential property owners to finance energy retrofits (efficiency measures and small renewable energy systems) and who then repay the financing over 20 years via an annual assessment on their property tax bill.
PACE bonds can be issued by municipal financing districts or finance companies and the proceeds can be typically used to retrofit both commercial and residential properties.
In today’s economy, few homeowners and commercial property owners have the upfront capital to invest in retrofitting their homes or buildings to take advantage of the advances in clean energy technologies and the possible cost savings obtained from those improvements. PACE bonds present an innovative, no-taxpayer subsidy approach to financing those individual clean energy projects on a large scale.
How PACE Works: PACE bonds are issued by a municipality or special district and backed by property tax liens on the buildings of owners who voluntarily take PACE loans from the bond pool. The property owner repays the loan over a 20-year period through an increase on their annual property taxes equal to one-twentieth of the loan plus interest. For many home and business owners, the annual energy cost savings they will realize from the retrofitting will exceed the cost of the annual repayment costs, thereby resulting in no net out-of-pocket expense.
PACE financing was named by the Harvard Business Review as one of the “Breakthrough Ideas for 2010.” It has the potential to result in significant job creation for Florida at no cost to taxpayers – only real estate owners who opt-in will pay the cost of the improvements.
The Florida Legislators approved PACE legislation and was signed into law by Governor Crist in May 2010
According to a Study by The Broward County Green Work Force, the evidence suggests that in Broward County there are existing and emerging green job opportunities, particularly for low to moderate income communities. These green jobs are likely to emerge in Energy Efficiency, Solar Technology, and Biomass. Financing programs can play a fundamental role in all three areas. After exploring a number of innovative government sponsored programs used around the country, one distinguished itself in terms of its effectiveness and political viability: PACE financing. Implementing a program in the county should have a substantial impact, particularly working in conjunction with the job training programs already in place. These programs can work together to provide individuals in low to middle income communities a promising path to green jobs.
Miami- Dade and Broward Counties have formally adopted resolutions supporting PACE. We will keep you posted on the implementation and new developments on this important issue.