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By BRETT WILKISON
THE PRESS DEMOCRAT
Two Sonoma County officials are headed to Washington, D.C. today to lobby for a county program that helps finance home and commercial energy retrofits.
Supervisor Shirlee Zane, who represents the Santa Rosa area, and Rod Dole, the county’s auditor-controller-treasurer-tax collector, plan to spend two days speaking with federal representatives about the county’s Energy Independence Program.
The 16-month-old effort was restarted last week after being suspended to new applications July 6 when a federal agency said such programs — authorized in 22 states — were too risky for the government-backed mortgage holders Fannie Mae and Freddie Mac.
The programs, known as Property Assessed Clean Energy, or PACE, depend on repayment of retrofit money through property tax liens that take priority over a mortgage if a homeowner defaults.
The Federal Housing Finance Agency said the arrangement presented significant risk to the mortgage giants and directed them to tighten their underwriting standards for new mortgages tied to PACE programs.
But county officials say no local PACE participants have defaulted on their mortgage, and that the actual money at stake in any such case isn’t that much. In a foreclosure on a home with $10,000 worth of energy improvements, for example, the county would seek only back taxes — $500, plus interest, for each year of unmade payments — and not the full amount of the project debt, according to officials.
“We plan to educate them about the facts and the safeguards we have in place here in Sonoma County,” said Dole.
So far, meetings have been set up with staff of the Senate Banking Committee and Senator Barbara Boxer’s office. Dole also said he hopes to meet with Rep. Mike Thompson, D-St. Helena.
Thompson last week introduced legislation that would force Fannie Mae and Freddie Mac to adopt underwriting standards that would accommodate retrofit programs and prevent the mortgage giants from discriminating against communities with such programs. The bill has been referred to the House Financial Services Committee.
As part of their pitch, Dole said he and Zane also plan to make the case that the county’s PACE program, and others like it across the nation, have created hundreds of jobs and spurred investment in energy efficiency.
In Sonoma County, about $30 million has been loaned for more than 1,000 residential and commercial projects, including window and door upgrades, renewable power systems and water-saving projects.
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One wonders how many BTUs will be burned on this outing to Washington. What’s wrong with email, telephone, video conferencing? They needed to travel to Washington to talk about saving a program to save energy?!
I guess such decisions are easier when it’s other people’s money being spent.
Sorry, its hard not to be sarcastic when one sees behavior so contrary to the public’s interest.
Lenders are correct in their concern. On default the PACE loan gets paid first and will need to be paid by the lender. Also with PACE loan the payments will be calculated into a buyers debt ratio meaning they can borrow less. This will degrade property value due to a smaller buyer pool.
If the county wants to get into the money lending business they need to play by the same rules as everyone else.
This idea should be rejected by Fannie Mae and Freddie Mac as is no more than a way around the normal lien process.
If the amount is so small, then why doesnt the county just give the loans unsecured with no lien placed at all?
you can only assume the feds have other priorities to allow this to happen…the question is: are those in our best interest? …but with all the secrecy who can make a call?
The SCEIP program is a rare breed, because of the diversity that exists in its vast range of community supporters.
Sonoma County is lucky to have Shirlee Zane representing it’s residents in DC.