Clean Energy Program Will Set PACE In Falmouth
March 17, 2020 : The Falmouth Enterprise, by Brad Cole
A new funding source will be available for energy-efficiency projects at commercial and industrial properties in Massachusetts.
Representatives from MassDevelopment met with the Falmouth Economic Development and Industrial Corporation at its March 10 meeting to discuss the Property Assessed Clean Energy program, which provides low-cost, long-term funding for energy improvement projects. MassDevelopment asked the EDIC toendorse the program for use in Falmouth.
"It is unique because it is financing that is tied to the property, or runs with the land, rather than more conventional financing that is typically tied to the borrower," said Wendy L. O'Malley, vice president and PACE program manager with MassDevelopment.
PACE funding is repaid through an assessment placed on the property. This assessment would transfer with the sale of the property.
"The project must be funded by energy savings that are identified, which are used as the repayment mechanism," Ms. O'Malley said.
The assessment is billed and collected on the property tax bill.
"The property owner would need to remit both the property tax amount and the PACE assessment to the municipality, which in this case would be Falmouth," Ms. O'Malley said. "Falmouth would only be required to disperse the assessment it has received to MassDevelopment as the program administrator."
She said the program is expected to launch in Massachusetts in "the next couple of months," at which point property owners will be able to apply for funding. EDIC member Susan L. Moran asked if funding would be available for residential properties or municipalities. Ms. O'Malley said the program is aimed at commercial and industrial properties.
"The only entities that are not eligible for this are municipality and government entities, because this is a tax-based financing program," she said.
In addition, the funding is not available for individual homeowners. However, multifamily properties that serve five families or more and nonprofit organizations are eligible. Executive director Michael DiGiano asked if nonprofit organizations exempt from paying property taxes could utilize the program.
"If they are exempt, but then they agree to have a tax bill sent to them, and the municipality agreed to do that, PACE could then be used for financing," Ms. O'Malley said.
Jay Pateakos, vice president of business development with MassDevelopment, said PACE funding could be used for new roofs to accommodate solar panels, new windows, improved HVAC systems or chillers. It is specifically for existing structures, not for new construction, he said. He estimated there could be between five and seven applicants in Falmouth.
The EDIC voted 5-0 to support the program.
"This is just fantastic," Ms. Moran said. "I think it will be a very exciting thing for Massachusetts, and Falmouth as well."