Beginning today, an innovative energy-smart finance program for homeowners – called Property Assessed Clean Energy or PACE – has a chance for revival. Over the next 60 days (until March 26th, 2012), a broad bipartisan coalition of business leaders, environmentalists, property owners and federal, state, and local policymakers will finally have a chance to make their voices heard and explain to federal regulators why PACE makes economic and environmental sense.
The PACE Saga
PACE programs, run by towns or counties, enable property owners to finance the initial cost of energy efficiency improvements or small scale renewable energy projects and pay them off in small increments that are added to property taxes over an extended period of up to 20 years. Participation in PACE programs is entirely voluntary and from the start, homeowners can save more on their energy bills than the cost of the payments thanks to the clean energy projects. Improvements financeable under PACE can include better insulation, more efficient windows, more efficient heating and cooling systems, and solar panels.
Because of the economic and environmental benefits PACE could provide, PACE programs were supported by wide range of stakeholders: from labor unions to Fortune 500 companies and environmental groups. Starting in 2008, over 27 states and the District of Columbia passed PACE enabling legislation and a large number of municipalities in those states started or were preparing to launch PACE programs locally.
However, nearly all existing PACE programs were halted in July 2010, when the Federal Housing Finance Agency (FHFA) and the Office of the Comptroller of the Currency issued instructions to Fannie Mae, Freddie Mac and the national banks that effectively froze PACE financing programs nationwide. The result was millions of dollars in federal stimulus funds in limbo, thousands of jobs implementing the projects left on the drawing board, and economic development plans and climate change goals across the country on hold. Lawsuits and proposed legislation followed, in addition to widespread frustration that the regulators had failed to consider the full range of implications of their actions. You can read about the status of the lawsuits at my colleague Kit Kennedy’s blog.
As described in more detail in Kit’s post today, a court order has forced FHFA to post an “advanced notice of proposed rulemaking.” FHFA now must turn back the clock on their rulemaking and provide public notice in the Federal Register of their intent to propose a rule on PACE and allow the public 60 days to comment and provide their perspectives on PACE.
NRDC, together with PACENow and a broad bi-partisan coalition, are now working hard to ensure that PACE’s supporters make their voices heard and that FHFA properly considers them. The regulators’ initial July 2010 attack on PACE was a backdoor surprise attack. Now, the chance to submit comments on the FHFA’s position on PACE could breathe new life into an important vehicle for jobs, the economy, and the environment.
Go to PACENow for more information about how to comment and be a part of PACE’s revival, and see the FHFA’s Federal Register posting for information on how to submit comments. Please make your voice heard to revive PACE!