Monthly Archives: November 2012

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The Bond Buyer
Monday, October 29, 2012LOS ANGELES – A program that allows property owners to finance energy efficiency and water conservation projects with the aid of municipal bond financing took another step forward when San Diego approved competing program administrators.

The San Diego City Council passed a resolution last week opting into the Property Assessed Clean Energy, or PACE, program administered by Figtree Energy Resources Co. for the California Enterprise Development Authority. A month earlier, the city council approved a resolution to opt into the CaliforniaFIRST program, operated by the California Statewide Communities Development Authority and administered by Renewable Funding.

“We will be first jurisdiction that has opted into more than one program,” said Cord Bailey, a spokesman for San Diego Mayor Jerry Sanders. “The goal is to increase competition to try to drive down the cost and to provide the widest selection of products for property owners.”
Originally conceived in Berkeley, Calif., in October 2008 as a way to help homeowners pay the up-front costs of installing energy efficient technologies, the PACE program stalled in July 2010 when the Federal Housing Finance Agency, which regulates Fannie Mae and Freddie Mac, ordered the government-sponsored enterprises not to underwrite mortgages for homes with PACE loans. FHFA was concerned because the PACE liens are senior to the mortgage, so the PACE lender would be paid ahead of the bank, or Fannie or Freddie, in the case of foreclosure.

PACE liens are added to the property owner’s tax bill and stay with the property if it is sold.

It’s unanimous!  San Diego City Councilmember David Alvarez (also Chair of the city’s Natural Resources and Culture Committee) moves approval of the job-creating economic development stimulus FIGTREE will be providing for San Diegans via PACE (Property Assessed Clean Energy) financing for commercial property owners.  PACE allows property owners to fund cost-cutting renewable energy and energy efficiency and water conservation improvements for their buildings and repay them for terms of up to 20 years via their property tax bills.  FIGTREE uses 100% private funds to finance the projects, which create much-needed jobs for contractors, plumbers and other professionals in San Diego’s renewable energy, energy efficiency and water efficiency sectors.

Hear Councilmember Alvarez’s remarks here.

 

 

Not all PACE providers are created equal.   FIGTREE CEO Mahesh Shah outlines the value-add FIGTREE brings to San Diego’s Commercial PACE marketplace.  FIGTREE is the only PACE provider in California to have successfully issued multi-jurisdictional bonds to fund commercial PACE projects with 100% private monies.  Because FIGTREE pools multiple PACE projects into bond offerings, the company can accept PACE projects that are much lower than the $50,000 minimum project value of other PACE providers.   In San Diego, a bastion for small business, contractors can fund PACE deals starting at $5,000 up into the millions of dollars, as long as the project cost doesn’t exceed 20% of an improved property’s assessed value.

See FIGTREE CEO Mahesh Shah’s remarks to the San Diego City Council here.