AGENDA ITEM #7
June 11,2013
Public Hearing
MEMORANDUM
June 7, 2013
TO:
FROM:
SUBJECT:
County Council
Amanda Mihill, Legislative Attorney
~
Public Hearing:
Bill 11-13, Commercial Property Assessed Clean Energy
Program - Established
Bill 11-13, Commercial Property Assessed Clean Energy Program - Established, sponsored by
Councilmember Berliner, was introduced on April 23, 2013. A Transportation, Infrastructure,
Energy and Environment Committee worksession is tentatively scheduled for July 8, 2013 at
9:30 a.m.
Bill 11-13 would establish a Commercial Property Assessed Clean Energy Program to assist
qualifYing commercial property owners to make energy improvements and establish a revolving
loan fund to provide property owners loans under the Program.
This packet contains:
Bil1ll-13
Legislative Request Report
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Bill No.
11-13
Concerning: Commercial
Property
Assessed Clean Energy Program ­
Established
Revised:
4/11/2013
Draft No. 1
Introduced:
April 23, 2013
Expires:
October 23, 2014
Enacted: _ _ _ _ _ _ _ _ __
Executive: _ _ _ _ _ _ _ __
Effective: _ _ _ _ _ _ _ _ __
Sunset Date:
_--:-_----:~----
Ch. _ _, Laws of Mont. Co. _ __
COUNTY COUNCIL
FOR MONTGOMERY COUNTY, MARYLAND
By: Councilmember Berliner
AN
ACT to:
(1) establish a Commercial Property Assessed Clean Energy Program to assist qualif)ring
commercial property owners to make energy improvements;
(2)
establish a revolving loan fund to provide property owners loans under the Program; and
(3) generally amend the environmental sustainability law.
By adding
Montgomery County Code
Chapter 18A, Environmental Sustainability
Article 5
Sections 18A-33, 18A-34, 18A-35, 18A-36, 18A-37, and 18A-38
Boldface
Underlining
[Single boldface brackets]
Double underlining
[[Double boldface bracketsD
* * *
Heading or defined term.
Added to existing law by original bill.
Deletedfrom existing law by original bill.
Added by amendment.
Deletedfrom existing law or the bill by amendment.
Existing law unaffected by bill.
The County Council for Montgomery County, Maryland approves the following Act:
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BILL No. 11-13
Sec. 1.
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Article 5 of Chapter 18A (Sections 18A-33, 18A-34, 18A-35,
18A-36, 18A-37, and 18A-38) is added as follows:
Article 5. Commercial Property Assessed Clean Ener2Y Program
18A-33. Definitions.
In this Section, the following words have the meanings indicated:
Commercial or industrial property
means any real property other than
residential dwelling with less than five dwelling units.
Commercial Property Assessed Clean Energy Program
or
Program
means
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program that facilitates energy improvements and requires repayment through
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surcharge on the owner's property tax bill.
Department
means the Department of Environmental Protection.
Director
means the Director of the Department or the Director's designee.
Eligible cost
means the net cost of buying or installing an energy
improvement, including any part, component, or accessory necessary to
operate the improvement or device, less any amount received from
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public or
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private program because the improvement or device is or will be made or
installed.
Energy improvement
means:
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ill
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renovation or retrofitting of qualifying commercial real property to
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reduce energy consumption; or
the installation of
renewable energy system to servIce qualifying
commercial real property.
Qualifying commercial real property
means any commercial or industrial
property, regardless of ownership, that meets the qualifications established for
the Commercial Property Assessed Clean Energy Program.
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18A-34. Commercial Property Assessed Clean Enern Program established.
The Director must create and administer
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Commercial Property Assessed
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Bill No. 11-13
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Clean Energy Program.
18A-35. Eligibility; use of funds.
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The Director may loan funds to an owner of
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qualifying commercial
real property to fund eligible costs to make an energy improvement on
the property,
!!p
to the maximum loan amount set
Qy
regulation.
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Eligibility.
To be eligible for
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loan under this Program,
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property
owner must:
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have an energy audit or renewable energy system feasibility
analysis on the qualifying commercial real property that assesses
the expected energy cost savings of the energy improvement over
the useful life of the improvement;
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provide 30 days' written notice to any existing mortgage holder
of the property of the owner's intent to finance the energy
improvement under the Program;
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obtain the consent of any existing mortgage holder for the loan;
and
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agree to repay the loan amount borrowed through the County tax
bill for that property, as required
Qy
Section 18A-36.
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Use gffundsfor an energy improvement.
ill
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A person may borrow funds for eligible costs to make an energy
improvement.
Except as provided
in
(c)(3), funds must be loaned only for an
energy improvement for which the energy cost savings of the
energy improvement over the useful life of the improvement
exceed the costs of the improvement.
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ill
Funds may be loaned for an energy improvement that does not
meet the cost criteria in (c)(2) if that improvement is part of
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BILL
No. 11-13
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package of improvements financed under the Program that
cumulatively meets that criteria.
(4)
Funds may be loaned only for an energy improvement that is
permanently fixed to!! qualifYing commercial real property.
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Disclosure to property owner.
The Director must disclose the following
to !! property owner:
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any cost or risk associated with participating in the Program,
including any risk related to the failure of the property owner to
P!!Y
the loan and;
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the interest rate of the loan, including any fees charged to
administer the Program, and any risk associated with variable
interest rate financing.
W
Ability to rescind.
The Director must notifY !! property owner that the
owner may rescind any financing agreement entered into under this
Article no later than
J
business days after the agreement is made.
18A-36. Repayment of funds; lien.
(ill
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The owner of qualifYing commercial real property must agree to repay
the loan amount borrowed through the County property tax bill for that
property.
®
i£)
If the property owner sells the property, the seller must disclose that the
buyer must continue to repay the loan through the property tax bill.
The loan amount and any accrued interest constitute !! first lien on the
real property to which the loan applies until paid. The loan amount and
accrued interest are collectable
by
suit or tax sale like all other real
property taxes, to the extent allowed
by
State law.
If
the property owner
does not
P!!Y
the loan and accrued interest as required, the property may
be certified to the Department of Finance and the lien may be sold at the
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BILL No.
11-13
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tax sale conducted
J2y
the County.
18A-37. Regulations.
The Executive must adopt regulations under Method
Program, including:
ill
to administer the
!ill
(Q)
(£}
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lending standards and priorities;
minimum and maximum loan amounts;
interest rates, terms, and conditions;
application procedures, including necessary supporting documentations;
criteria for adequate security;
procedures to refer applicants to other sources of funds, and to
cooperate with other public and private sources of funds;
ill
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(g}
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procedures to ask the Director to reconsider any denial of
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loan or any
decision on interest rates, terms, and conditions;
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(h)
procedures for nonpayment or default;
procedures and requirements for post-installation inspection;
disclosure requirements for real estate transactions; and
criteria for loan disbursement.
ill
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(k)
18A-38. Revolving loan fund.
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Definitions.
In
this Section, the following words have the meanings
indicated:
Department
means the Department ofFinance.
Revolving loan fund
or
Fund
means the special, nonlapsing fund to
finance the Commercial Property Assessed Clean Energy Program
established under this Article.
(Q)
The Fund consists of:
ill
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money appropriated in the County budget for the Program;
money received from any public or private source;
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BILL
No. 11-13
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interest and investment earnings on the Fund;
repayments and prepayments of principal and interest on loans
made from the Fund; and
any other available funds to support the Program.
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The Department must:
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disburse funds and collect payments for
Program; and
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loan made under the
m
Approved:
maintain loan records and provide an annual report to the
Department of Environmental Protection.
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Nancy Navarro, President, County Council
Date
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Approved:
121
Isiah Leggett, County Executive
Date
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This is a correct copy o/Council action.
123
Linda M. Lauer, Clerk of the Council
Date
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LEGISLATIVE REQUEST REPORT
Bill 11-13
Commercial Property Assessed Clean Energy Program
-
Established
DESCRIPTION:
Bill 11-13 would establish a Commercial Property Assessed Clean
Energy Program to assist qualifying commercial property owners to
make energy improvements and establish a revolving loan fund to
provide property owners loans under the Program.
Making energy efficiency improvements to commercial buildings can
be a cost-effective way to reduce greenhouse gas emissions.
However, the lack of accessible financing options is a barrier to many
property owners and may prevent them from making these energy
efficiency improvements
To establish a program to provide property owners with a financing
option to make energy efficiency improvements to their commercial
property, thereby reducing energy costs and greenhouse gas
emissions.
Departments of Environmental Protection, Finance, and Permitting
Services.
To be requested.
To be requested.
To be requested.
To be researched.
Amanda Mihill, Legislative Attorney, 240.777.7815
To be researched.
PROBLEM:
GOALS AND
OBJECTIVES:
COORDINATION:
FISCAL IMPACT:
ECONOMIC
IMPACT:
EVALUATION:
EXPERIENCE
ELSEWHERE:
SOURCE OF
INFORMATION:
APPLICATION
WITHIN
MUNICIPALITIES:
PENALTIES:
N/A
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