Julie Partain from Bracewell, Collin County’s bond council, gave a presentation on Property Assessed Clean Energy programs during the commissioners' meeting Oct. 19. She explained the program would essentially allow property owners to get a loan that offers a lower cost to construct and install energy efficient improvements to their properties.
The Texas comptroller's website explains that under a PACE arrangement "property owners evaluate measures that achieve energy savings and obtain financing, repaid as an assessment on the building." That assessment then allows property owners access to "low-cost, long-term capital to finance improvements to the property," the site states.
Partain said the program currently extends only to commercial or multifamily residential properties.
“These are not for individual residents,” Partain said. “If you own your own home, you cannot go get a PACE loan to put solar panels on the roof.”
She explained PACE is a tri-party program, meaning property owners, lenders and the county would all enter into agreements with each other, so the county would do an assessment but would not loan any money. If the county establishes the program, Partain said it would need one or more administrators who could find qualified projects, property owners and qualified lenders. The program administrators would also be responsible for drafting required reports and form contracts.
“At the end of the day, though, it is a lien,” she told commissioners. “It has the same priorities as ad valorem taxes, which is what makes it valuable to a lender. Under the terms of your contract with the lenders, they will require you to foreclose on that property for non-payment. That's how they get their security.”
Commissioner Duncan Webb, who introduced the item to the court, said he is aware of three property owners that are interested in the program if it is adopted. He also noted it is a voluntary process with property owners coming to the county to begin the process. Partain said she was not aware of any property owners that have gone into foreclosure from electing to participate in a PACE program.
Commissioners approved a motion to begin the process of creating a Collin County PACE program by a 4-1 vote, with Commissioner Darrell Hale voting against it. Before the program can be formally established, County Administrator Bill Bilyeu said the county will still have to go through a public hearing process.
Hale said he was initially neutral to the idea of the program, but after Commissioner Susan Fletcher said she was in favor of it as long as the county was not picking “winners and losers,” he decided to vote against it.
“The county is putting the PACE program loan ahead of all other mortgages and all other indebtedness on the property, so it in fact is picking winners and losers,” he said. “That’s essentially why I voted against it.”
Hale said he was unsure how he would vote on the establishment of the program in the future, noting he would “see what kind of arguments” came out of future discussions.
“I try to be open-minded on every single one of the votes,” he said.