PACE in Missouri

Background

Missouri passed PACE-enabling legislation in 2010 to allow residential and commercial PACE financing. There are currently four commercial programs operating, and three residential PACE programs including the Missouri Clean Energy District (MCED); YgreneWorks and Missouri Energy Savings Program (MO-ESP); and YgreneWorks and Set the PACE St. Louis.

Active PACE programs

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Missouri PACE clean energy

Missouri Clean Energy District program is launched and open for business. It is a statewide commercial PACE program capable of enrolling every municipality in the state. Missouri Clean Energy Funding LLC, program administrator, and is actively working on getting municipalities to join the program. To date, the following municipalities have joined the program, namely: Branson (Taney County), Charlack (St. Louis County), Cole County, Cooper County, Ferguson (St. Louis County), Galena, Hazelwood (St. Louis County), Hollister (Taney County), Jefferson City (Cole County), Nixa, Olivette (St. Louis County), Ozark and Ozark County, Taney County, and Warrensburg ( Johnson County), West Plains. The process of joining is simple and it does not involve a public hearing since there are no public funds involved. Once a municipality passed an ordinance, it officially joins the Clean Energy Development Board, which has the authority to levy assessments on properties. Property taxes are collected in a single installment on December 31st in Missouri. Financing for the program will be provided through a warehouse model – local and regional banks will offer a line of credit and a separate loan loss reserve fund amounting to 10% of assessments. Bonds will be issued once project reach roughly $5 million. The interest rate is expected to fall between 6.5 and 6.75 percent. The program will acquire lender consent for each project. Minimum size of the project is $5,000, while there is no maximum amount. Some major project eligibility requirements are: • Property must be physically located within the Clean Energy Development Board’s financing district • Must be current on property taxes for the last 3 years with no involuntary liens • The applicant may not request more than 15% of the Assessor’s appraised value of the property • Commercial properties must have a min. 50% occupied or may be appealed to the CEDB for approval • Term will not exceed useful life of improvements or maximum of ten years. For more details, please check out Project Underwriting Guidelines. As the Program Handbook illustrates, there is not a list of specific program requirements, but proposed improvements must be: • Only permanently fixed, new Improvements are eligible for Program financing • They must provide an economic benefit equal to or greater than the cost of the assessments. • They must be installed by a contractor or vender approved by the Board. • The economic benefit of the improvements must be verified by an approved energy auditor, professional engineer or, in certain cases, by documentation provided by the manufacturer. According to Missouri PACE statue (House Bill 1692), “the estimated economic benefit expected from the project during the financing period is equal to or greater than the cost of the project.” Therefore, program staff is going to use the list of state approved auditors and professional engineers to sign off on the projects. As for the outreach efforts, the Missouri Clean Energy District program engaged a lobbying firm, Renew Missouri, and business development program at the University of Missouri to help market the program to municipalities and property owners. Program Documents:  Missouri – PACE Best Practices – Implementing PACE in Missouri, Program Handbook, Underwriting Guidelines,Application. Contact Information: David Pickerill, Principal at MoCEF Phone: (866) 554-4083 Email: [email protected]

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MO-ESP_logo_2-flatMO-ESP (Missouri Energy Savings Program) is an innovative program that uses PACE financing to help St. Louis County homeowners and commercial, industrial and multi-family property owners access affordable, long-term financing for smart energy upgrades to their buildings. PACE (Property Accessed Clean Energy) financing allows home and building owners to finance qualifying energy efficiency and renewable energy improvements through voluntary tax assessment. Property owners pay for the improvements over time and the repayment obligation transfers automatically to the next owner if the property is sold. Similar to a sewer tax assessment, capital provided under the PACE program is secured by a lien on the property, so low-interest capital can be raised from the private sector with no government financing required. PACE financing offers a broad range of benefits to homeowners and commercial building owners as well as energy efficiency/renewable energy contractors.

The St. Louis County Clean Energy Development Board was created by ordinance in 2015 by the St. Louis County Council. The board is a separate political subdivision of the state of Missouri, and directors are appointed by the County Executive of St. Louis County. There are five director positions and they typically serve a three-year term. The Program operates as the Missouri Energy Savings Program. The CEDB sets the policy for the Missouri Energy Savings Program and has contracted with Energy Equity Funding, along with their partners, Rockwood Group and Ygrene Energy Fund as the administrator team to run the Program. While the administrator team provides underwriting and financing for the Program, in addition to administering third-party funded commercial PACE projects, the board oversees all functions of the Program and approves financing through the Program. To learn more and check your eligibility, please visit www.mo-esp.com.

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The City of St. Louis launched an innovative method for property owners to finance clean energy and energy efficiency improvements for their homes or businesses. As part of the City’s sustainability efforts, the Set the PACE St. Louis program enables residential and commercial property owners to finance energy efficiency, water efficiency and renewable energy upgrades with a novel funding mechanism that offers distinct advantages over traditional loans. The program launched on July 2, 2013 and is actively accepting applications.Click here to apply. The three primary objectives of the Property Assessed Clean Energy (PACE) financing program are: (1) encourage energy efficiency in buildings to reduce greenhouse gas emissions, (2) reduce energy costs and promote utility savings for building owners, and (3) foster green jobs and boost local employment opportunities. Some of the many eligible projects include energy efficiency measures, high efficiency lighting, roofs, heating ventilation air conditioning (HVAC) upgrades and controls, boilers, furnaces and water heating systems, as well as renewable energy systems such as solar PV panels and fuel cells. In addition to low interest rates, PACE financing has distinct advantages over traditional loans: • PACE loan stays with the property upon sale, transferring to the new owner • Commercial property owners may pass payments through to tenants • Borrowing capacity is preserved through off-balance–sheet financing Program Documents: PACE Application, List of Eligible Projects, Program Launch Press Release, PACE Brochure, PACE Contractor Flyer.

 

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Show Me PACE has chosen the Missouri Energy Initiative (MEI), a Missouri-based 501(c)3 nonpartisan nonprofit, as the program’s administrator.

More details about Show Me PACE:

  • Nonprofit, low-cost administration structure.
  • Market is open to all building owners, developers and finance providers.
  • Every PACE assessment requires mortgage lender consent and institutional-grade underwriting.
  • The administration is structured to reduce multiple layers of mark-ups from various service providers.

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PACE Municipalities in Missouri

PACE Enabling Legislation in Missouri

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MikePACE in Missouri