PACE in Minnesota

Background

Minnesota passed PACE-enabling legislation in 2010, which enabled multiple PACE programs to begin operating in the state. There are currently two active commercial PACE programs.

Active PACE programs

 Residential           1466123363_tick_16 Commercial

Minnesota PACE SRDCPACE is a financing tool used to assist businesses (including agri-business) and non-profits (including churches) with improvements that substantially increase energy efficiency. PACE allows property owners to make these fixture improvements without the up-front capital outlay. Costs for the improvements are paid back through a special assessment on their taxes. The increase in property taxes is offset by the decrease in energy costs so that the property owner sees no change in the bottom line.

The key points to note:

  • Total loan amount is tied to property value (20% of the EMV)
  • Loan size ranges from $5,000-100,000 (no match requirement).  Loan size cannot be greater than 20% of the property’s assessed value.
  • Loan amount based on projected energy savings (determined by an energy audit)
  • Must be a 1:1 savings ratio (meaning—the business sees no change in net operating costs or better yet—a reduction in operating costs!)
  • Must be located in the Rural Minnesota Energy Board region
  • 1% origination fee
  • 4% minimum interest rate

Feel free to SHARE the brochure. Contact information: please email or call Robin Weis, the Economic Development Director of the Southwest Regional Development Commission at 507-836-1638.

 Residential           1466123363_tick_16 Commercial

MinnPACE, a division of the Saint Paul Port Authority, is proud to be the State of Minnesota’s largest provider of PACE financing for commercial building owners investing in energy efficiency upgrades and renewable energy projects.  Since the program’s inception in 2013, MinnPACE has established joint powers agreements with 31 counties and 20 cities across the state (as of February 7, 2016). An additional 20 joint powers agreements are in pending status and we expect these numbers to grow as we have the authority to work with any city or county in Minnesota.

 

Click here for a list of cities and counties working with MinnPACE.

 

Qualifying Investments:

  • Energy efficiency upgrades: HVAC, lighting, motors, compressed air, new manufacturing equipment and more
  • Renewable energy investments: solar, wind and geothermal

Qualifying Industries:

  • Industrial/manufacturing
  • Multi-family housing (5+ units)
  • Agriculture
  • Nonprofits
  • Places of worship

Program Benefits:

  • Property owners are able to invest in energy efficiency and/or renewable energy upgrades with no upfront costs
  • Utility savings exceed payment obligations, making investments cash positive for property owners and tenants
  • Payments are rolled into a special tax assessment made payable twice per year as part of the building owner’s property taxes
  • The program is tax neutral with financial exposure for cities or counties
  • Energy saving investments promote local jobs

For More Information:

– or –

PACE Municipalities in Minnesota

PACE Enabling Legislation in Minnesota

Next step…

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MikePACE in Minnesota