Financing options for property improvements has proved to be the limiting factor for homeowners and building owners looking to improve the energy and water efficiency of their property, as well as to mitigate wind damage. Several Florida communities and cities across the U.S. shared similar findings, and now more than 60 local governments in Florida have launched community-based financing programs to address this market barrier.
Property Assessed Clean Energy (PACE) has emerged as the primary method of developing voluntary, community-based finance programs for wind protection, energy efficiency and renewable energy improvements. PACE was created to overcome commonly cited barriers to energy efficiency investments, including:
· High up-front cost barrier to energy efficiency and renewable energy improvements,
· Reluctance of property owners to make investments with long paybacks coupled with uncertainty of how long they will retain ownership of the property, and
· Unease of navigating contractors and viability of efficiency improvements.
Pursuant to the Florida PACE enabling legislation (Fla. Stat. 163.08), a local government may establish a PACE financing program for qualified improvements wherein the local government or a third-party administrator (via an inter-local agreement between multiple Florida governments) provides project financing for the costs of qualified improvements and the property owner repays the costs, with interest, through a special assessment levied on the property. The PACE assessments are repaid over a set term and billed annually on the property tax bill as a non ad valorem assessment.
The City of Orlando is seeking to allow its businesses and residents to voluntarily participate in one or more of these PACE programs for residential and commercial property. To that end, the City of Orlando has engaged with three established PACE Programs, including the Florida Green Finance Authority, Green Corridor PACE, and the Florida PACE Funding Agency. Each of these agencies will handle all significant aspects of the program, including general administration, website creation and updating, energy analysis, contractor training and approval, marketing, levy of assessment, financing and collections. The City is not responsible for any of those activities, but may provide marketing and communications help to assist in the promotion of the program.