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Home My WebLink AboutBackground MaterialsBACKGROUND MATERIALS Resolution M.2, File 11-00878 Resolution Joining Green Corridor Property -Assessment Clean Energy District January 12, 2012 Includes the following: 1. Ygrene Program Synopsis - City of Miami 2. Contract Between Ygrene Florida Energy Fund and the Town of Cutler Bay 3. Florida Statute 163.01 Florida Interlocal Cooperation Act of 1969 — authorizes local governments join together to execute interlocal agreements 4. Florida Statute 163.08 Supplemental Authority. for Improvements to Real Property — authorizes local governments to implement PACE Programs 5. ,Miami Herald Article, "Program will help homeowners pay for energy efficiency," by Perry Stein, October 28, 2011. 6. New York Times article, "Tax Plan to Turn Old Buildings `Green' Finds Favor," by Justin Gillis, September- 19, 2011. 7. Press Release, "Ygrene Makes $100 Million Commitment in White House's Better Buildings Challenge," December 2, 2011. 8. Press Release, "Lykes Bros. EcoAsset Solutions Joins Ygrene Energy Fund to Drive Florida Job Creation," November 9, 2011. 9. PaceNOW, "Property Assessed Clean Energy: Innovation for Financing Energy Efficiency" from http://www.pacenow.or2,-. 10. Pike Research; "PACE Financing Consumer Survey: Consumer Preferences and Attitudes about Property -Assessed Clean Energy Financing Programs," Published 1Q 2011. 11. Rod Dole, "Sonoma County Energy Independence Program," PowerPoint presentation October 17 -18, 2011. • „ Ygrene Program Synopsis L Citv, of Miami 100 B Street, Suite 210 Santa Rosa, CA 95401 p: 877.819.4736 f: 707.579.4617 www.ygrene-energy.com -Company Confidential- Company Confidential TabTaWe , C nt6nL Ygrene Energy Funs! Program Summary Ygrene Process Flow 3 Briefing Documents Contractor Application, Certification & Training 3 4 Financing Overview 6 Indemnification i Insurance 8 Frequently Asked Questions 15 Ygrene Economic Impact Analysis Appendices 1 - Economic Impact Analysis of PACE Programs by ECONorthwest 2 PACE Financing Consumer Survey by Pike Research 3 - Sonoma County Energy Independence Program by Rod Dole 4 Agreement between Ygrene Energy Fund and the Town of Cutler Bay Company Confidential s s YGRENE ENERGY FUND PROGRAM SUMMARY Purpose: To provide a tuni-key program to provide an innovative financing solution for property owners to complete energy savings projects Benefits to Property Owners Save money on their energy bills and increase property value Pre -approved 100% projectfunding • On line easy to use project approval system, no credit check •„ Innovative financiaLstructure for commercial property owners Program Success Example: Sonoma CA, Over 2.5 years $44.2 million in Residential Projects (2,423 projects with avg. disbursement of $18,236) $9.1 million in Commercial Projects (77 projects with avg. disbursement of $118,199) 1 foreclosure -(in early days of program, property wouldn't have qualified under current underwriting procedures) 65 local construction jobs created Benefits to City Local construction jobs and attracts industry solutions No cost to city No city balance sheet exposure or long term capital risk Economic Impact: ✓ $4M in project spending ✓ $10M gross economic output ✓ 60 jobs Benefits to Local Construction Industry Open market - On -going training program through Clean Energy Center Best source of capital to fund EE/RE projects Easy to use system to submit projects and receive payment for services Risk to District No cost or risk to general fund No exposure to project financing, thus no risk to district balance sheet No collection risk Operational risk minimized through contractor certification process Procurement Process Open and competitive process Open to public review Ygrene "teamed" with other potential bidders toofferthe winning -solution Company Confidential Mint ISM WM 01141 MN WINNI AIM iffEt1 LEMNI, Immo_ i own mew ragm *pm 3 iequapijuo3 Aue NJ DiStid&FOrhiatidn:: r Marketing/Outreach • :Prop y :Database.:••• > All Properties FIS Qualified Non -Qualified YGRENE ENERGY FUND PROCESS FLOW Administration/Semaye grene EWEI1GY FUND A • ';31:Experian- Distribution Year V;e&•.i, Contractor Bid Submissions I',e-Year1 Capilalized Interest Tax Yew 111111111111111111 Colelidor Year Assign Caslt Flow & Record Lien Adjust zr c Le civ liftioYgiVaGs,'Lt,Wag. Paid - OK Collection Cycle Not Paid - re e Pays --> Paid Off Sell Certificates ,Rule 14'4 1 1 4 9 CONTRACTOR CERTIFICATION AND TRAINING Based on State or other licensing requirements, Ygrene registers and authorizes all participating contractors. The program is open to all licensed and insured contractors. Ygrene provides and requires both direct and indirect training to ensure that program participants are professional, knowledgeable and qualified to undertake PACE projects. Ygrene will provide ongoing training, oversight and require contractors to exercise a high level of skill and integrity in the .installation of PACE improvements in the District. To this end, participating contractors will be required to (i) insure that roof structures are adequate and appropriate for installation of.roof-mounted photovoltaic systems; (ii) comply with environmentally responsible guidelines for the removal and disposition of CFC's and other greenhouse gases;.(iii) apply best commercially reasonable induistry.standards in the installation of all improvements financed under the program; and (iv) attend training programs designated by Ygrene from time to time. In addition, Ygrene will provide continuous oversight, evaluations, and conflict resolution. Software is being perfected which includes the following capabilities: • Enables all licensed building contractors to apply for participation in the program. • Provides a platform where contractors are able to: - Manage the project submission and approval process - Track the progress of payments due under their contracts • Provides a set of standards to calculate a Savings to Investment Ratio through audit and bid tools. • Provides immediate access to a wide range of data and reports related to the oPeration, status and success of the overall program. Company Confidential FINANCING OVERVIEW Subject.to the award of the program to Ygrerie, completion of necessary due diligence and final approval by Barclays Capital Commitments Committee, the firm will provide a commitment to finance all qualified projects. Standards for qualification are that the project is (i) underwritten and. executed within the District, (ii) that it meets terms and conditions established by Barclays, (iii) and (iii) that it is administered by Ygrene through its national aggregation warehouse facility. Once aggregation levels reach sufficient volume to facilitate access to the bond market, Barclays will serve as senior manager for bond issuance activities. ,Barclays Capital reserves the right to underwrite each PACE financing project and to reject those that may not meet appropriate credit standards for long term financing. The participation of Barclays is also subject to capital market conditions, federal securities laws and adequate bond credit ratings. Ygrene's program provides the following financial model: Ygrene, through Barclay's Capital or alternative sources such as local banks, will provide interim (warehouse) financing for the District, sufficient to;' aggregate adequate assessments to offer Barclays an initial securitization package. Once the assessments are aggregated, Barclays will issue investment grade bonds to be offered to pension funds and other long term investors. Ygrene will form a separate, affiliated company ("Ygrene Funding") to ...provide credit administration and underwriting services for this funding arrangement. Besides providing assessment funding that will respond to virtually any level of demand, the Ygrene-fnancial model funds the administrative, marketing, legal and other costs of operating the District program. Like other financing programs, PACE is subject to market forces and interest rate fluctuations that will require adjustments of rates and terms during operation of the District program to maintain viability. Ygrene's initial target interest rate for property owners participating in the District program is 7.00% ("Program Interest Rate"). This is based on a current estimated cost of funds from Ygrene Funding of 6.50% (the estimated "Funding Rate"). This example results in an interest rate spread of one half of one percent (0.5%) to provide for the operating aril administrative costs of the District program ("Operating Capital"). Ygrene uses the Operating Capital for program administration, marketing, program development, legal and bond counsel, District cost reimbursement, overhead and profit. The actual Funding Rate is estimated to be the on -the -run U.S. Treasury 10-year bond rate plus 3.25%. If the Funding Rate increases, the Program Interest Rate will increase by a like amount to provide adequate Operating Capital. Ygrene will endeavor to keep the Program Interest Rate as low as possible. In addition to the Operating Capital, Ygrene relies on very minor Program fees to fund operations...This fee... structureminimizes up -front costs..for.property..owners...._.A_typical .residential application will pay $420 in fees, $370 of which can be financed through the assessment. Funding for program operations is enhanced by a 3.0% Project Oversight fee charged to Certified Contractors to reimburse the Program for training, lead generation, marketing services, Energy Center meeting space and services, etc. Ygrene will aggregate and accumulate carbon credits that result from PACE projects financed through the Program. A possible future source of Program-: revenue could- result -from the. development of a market for these credits. Company Confidential 4 The Program is available to all privately owned improved property. The financing terms and conditions set forth in these Program Terms are applicable to financings of $250,000.OD or Tess for retrofit projects' in residential -and non-residential properties (including multifamily properties). The District will establish the financing terms and conditions appropriate to larger projects at the time of financing. approval. Low-income applicants are encouraged to apply and may qualify for •assistance with the application fee or audit costs. The aggregate- principal amount of the Program funding attributable to the property cannot exceed 20% of the value of the property (based on just value, appraised value, or market value). fl' Through Willdan Financial Services, YgFene will coordinate ongoing management and verification of assessments throughout the amortization term of the financing. Participating District cities will need to provide a designated representative to sign- financing agreements with property owners. The cities and the District will have oh -going, real time, electronic access to reports related to program results. The District's administrative duties and responsibilities should be minimal and cost recovery'mechanisms are in place. Company Confidential 5 INDEMNIFICATION The contract stafes that Ygrene shall defend, indemnify, and.hold harmless the District, its officers, 'agents and employees, from and against any and all demands, claims, losses, suits, liabilities, causes'of action, judgment or damages, arising out of, related to, or in_any way connected with their performance or non-performance of any provision of this Agreement, including, but not limited to, liabilities arising from contracts between Ygrene and third parties made pursuant to this Agreement. Ibis_ expressly includes all demands, claims, losses, suit.1liabilities, causes of action, judgment or damages, arising out of, related to, or many way connected with the voluntary non -ad valorem assessments constituting a lien of equal dignity to taxes as authorized by the PACE Act. The contract with Ygrene further provides that the Administrator shall indemnify the District and the Members from and against collection risk related to the bonds issued for PACE assessments in the District. In the event of a property tax default by the owners) of any property against which a District. PACE assessment hasbeen recorded, Administrator agrees to purchase 'thetilk lien certificate. These provisions shall survive termination of the Agreement. Florida Statute currently provides that the local government will enter into the financing agreement with the resident as opposed to the District. Therefore, the resident could sue the District and the local government over the terms of the financing agreement. .However, Ygrene has indemnified the cities against this risk. Similarly, if Fannie and Freddie were to sue over the financing agreement, they would likely sue the District and the local government also, since the local government signs the financing agreement. As previously discussed, Ygrene has also indemnified the cities against this risk. We have done the best we can to reduce the risk to the cities. We hope to change the state law this session to provide that the District will sign the financing agreement thereby eliminating the situations described above. According to Ygrene's bond counsel, neither the District nor the member cities have any liability to the bond holders. All sources of capital for the program are private. There is ,eo financial obligation to the District or the member cities. Company Confidential 6 INSURANCE Ygrene has a relationship With Energi Insurance Services; Inc., a subsidiary of Hannover Re, the second largest reinsurance underwriter in the world. Energi's Solar Installation Performance Warranty (SIPW) and Energy Savings Warranty (ESW) programs are targeted to support the growth and, development of the energy efficiency and alternative energy industries through risk mitigation via insurance. The SIPW program provides coverage against lost revenues resulting from a solar contractor's desigmor installation work on commercial properties. The ESW program manages risk to project owners and efficiency contractors by insuring the energy savings guaranteed by the contractors performing the retrofits. Originally designed for large energy service companies (ESCOs), Energi its making this program available to strong commercial contractors that agree to utilize best practices in their construction activities. Energi's programs are available to' larger commercial contractors certified through the District PAGE program, and the company is working to expand the availability to smaller firms. Ygrene will secure, and maintain throughout the duration of the TPA Agreement, insurance of such type and in such amounts as are necessary to protect its interests and the, interests of the District against hazards or risks of loss as specified below. Any insurance maintained by the District shall be in excess of Ygrene's insurance and shall not contribute to Ygrenes insurance. General Liability Insurance shall be written in comprehensive form and shall protect Ygrene and the District against claims arising from injuries to members of the public or damage to property of others arising out of any act or omission to act of Ygrene or any of its agents, employees, consultants, business partners or subcontractors. The limit of liability shall not be less than $1,000,000.00 per occurrence, combined single limit for Bodily Injury Liability and Property Damage Liability. Motor vehicle insurance shall be written in comprehensive form and shall protect Ygrene and the District against claims for injuries to members of the public and/or damages to property of others arising from Ygrene's use of motor vehicles. The limit of liability shall not be less than $500,000.00 per occurrence, combined single limit for Bodily Injury Liability and Property Damage Liability. Ygrene shall provide the District with Certificates of Insurance for all required policies. The Certificates of Insurance shall not only name the types of policies provided, but also shall refer specifically to the TPA Agreement and shall state that such insurance is as required by the TPA Agreement. The District is to be specifically included as an Additional Insured for the liability of the District resulting from operations performed by or on behalf of Ygrene in performance of the TPA Agreement. Ygrene's insurance, including that applicable to the District as an Additional Insured, shall apply on a primary basis and any other insurance maintained by the District shall be in excess of and shall not contribute to Ygrene's insurance. All deductibles or self -insured retentions must be declared to and be approved by the District or its duly authorized representative. Ygrene shall be responsible for the payment of any deductible or self -insured retention in the event of any claim. Company Confidential 7 FREQUENTLY ASKED QUESTIONS Where does the initial financing come from for the assessments? Cutler Bay, through an RFP process, has selected Ygrene Energy Fund Florida to provide funding and administration for the District PACE program. Ygrene will obtain a line of credit from Barclays Capital, or from other sources such as a group of local banks, and will provide all funds necessary to finance project assessments. Once Ygrene has entered into a certain amount of assessments, the loans will be packaged together and sold as bonds. Is the City responsible for its own citizens or is the money pooled for the advantage of citizens District wide? The money is pooled district wide for the property owners that are located within the District. The advantage of pooling the money• is that this will assist in obtaining lower interest rates for the assessments. , Here's my question: Is each City responsible for approving assessments in its own city for the tax rolls? Anything else? 'We expect that the special assessments will, be''pi or the property tax rolls. ; Ygrene will be working with the Property.Appraiser and Tax Collector on this matter. What is the difference between "authorized agent" and "authorized official"? The authorized agent represents the coalition to the District. One authorized official in each city signs up citizens in that city for "contractual assessments". Paragraph 3a. - what are "contractual assessments"? PACE is based on voluntary special assessments that allow the payments for project financing to be included on the propertytax bill as a non -ad valorem assessment. Section 11: what is meant by "Incur debt" ? The District is being created pursuant to Section 163.01, F. S. - Florida Interlocal Cooperation Act. Section 11 simply recites. the powers that the District may have under the Statute. In other words, if the District wanted to incur debt it would have the option to do so. If the District defaults, is city fable? If the actual "District" were to default then the parties to the interlocal agreement would be liable. However, it is unlikely that the District would actually default because the District will have no assets or liabilities. If individual property owners -default on an assessment, there is no liability to the City within which the property is located. Another question from me: What is the legal relation between the District and the company selected to run the program? Cutler Bay will be assigning Ygrene's contract to the District. Ygrene will be the operator of the .District program. .Ygrene will_workfor_the District..._. Paragraph 2.1 District has to be composed of an aggregate population of 500,000, unless agreed to in writing to be a lesses amount. At what point of population is the plan viable? We are working on a number of solutions to this issue, including county -wide district boundaries. Besides economies of scale, the biggest problem is the bond validation - for which the boundaries of .the district must be described. Ygrene believes this issue will be resolved within a few weeks. Company Confidential 8 ff E t t s t Paragraph 2.3 - Initial Term is 5 years with no options. My concern is'that there is nothing in the TPA that extends •Ygrene's financial indemnification after its term ends,. as to the -properties •established during the term for a continuing duty to purchase tax certificates after termination (see Paragraph 11.) Indemnification as it is is not clear. • Ygrene was earlier informed that the cities bore collection risk resulting from defaults. Bond counsel now assures us that the Districts member cities have absolutely no financial . risk associated with -the bonds. Further, we believe that the indemnities survive termination of the agreement. It appears in a reading of the entire agreement that, notwithstanding the Administrator's responsibilities, I do not see how District staff will not be hired to be paid and administer the program (with a municipal liaison and staff member) for the required checks and balances and independence from Ygrene, with associated administrative and legal counsel costs. See 5.2* b and 15 for example. The cities will need to provide a designated representative to sign financing agreements with property owners. The cities and the District will have on -going, real time, electronic access to reports related to program results. The districts administrative duties and responsibilities should be minimal and cost recovery mechanisms are in placd. tom: Paragraph 6.2 - Administrator's Responsibilities is missing - my version jumps from 6.1 incomplete to 6.3. Paragraph 6.2 reads as follows: "Administrator shall require contractors to exercise a high level of skill and integrity in the installation of PACE improvements in the District:` -To this end, participating contractors will be required to (I) insure that roof structures are adequate and appropriate for installation of roof -mounted photovoltaic systems; (ii) comply with Administrator's guidelines for the removal and disposition of CFC's and other greenhouse gases; (iii) apply best commercially reasonable industry standards in the installation of all improvements financed under the program; and (iv) attend training programs designated by Administrator from time to time." Paragraph 6.3 Carbon credits are being given 1 to Ygrene and`1 to the District to be split amongst the District members proportionately as to population or dollar amount of use in each municipality? (What does inter -local say) What is the estimated value of these credits. See page 17 of Exhibit A 5 and 5.4 in particular calling for District Staff. Ygrene will market credits -what is the current market value of these credits? Nothing is less certain or known than the potential value of carbon credits. As things stand currently, they have little or no value. Ygrene believes that, properly certified, managed, and aggregated with other PACE -generated credits, they will have value in the future. Paragraph 8. Termination - financial guarantees may terminate and District holds the bag or solar panel. According to Ygrene's bond counsel, the district has no collection risk for the bonds. It also has no responsibility for the improvements. Ygrene is exploring insurance options for property owners that they -can -employ -and we will recommend mitigating casualty -risks. Company Confidential 9 Paragraph 11. Indemnification: 11.1. I am not aware of the relative financial strength today of Ygrene, but with only a one million dollar insurance policy (see 24 is it one million only per occurrence/what is the aggregate coverage), with the potential multi tens of millions of sales, if not hundreds, is there enough financial strength, escrow or funding of Ygrene (remember Lehman Bros). The indemnification does not relate to the Districts attorney fees if sucked into litigation, if separate legal counsel is sought. Ygrene has .an obligation to provide legal defense against claims for the district and the member cities. Ygrene is administering the program. Barclay"s is providing funding and issuing the bonds. I would leave it to legal counsellor the district and the member cities to weigh in on the potential aggregated risk to the cities from the PACE program. Exhibit A - 1.2 I would like to know who and what is the reserve fund, and what those funds will be allowed to be expended on. The issues of necessary reserve funds, and all other elements of the post=warehouse bond financing, are being developed by Barclays. They relate primarily to the combined elements of the security that -effect bond ratings. Ygrene, in concert with Barclays, has secured warehouse facilities sufficient to :fund the program. According to our bond counsel, neither the district nor the member cities are at risk as a result of the bonds. Section V.1 - Purpose of Program - This expressly'calls for the District to authorize Bonds to provide a source of financing to the program. I thought the Administrator had its own source of private funding?? Section VI 1. mentions Barclay's capital as warehouse lender for long term bonds to initially fund the bonds - I thought these are totally private bonds and there is no Palmetto Bay guarantee -Or liability of individual municipalities or the District for issuance or payment - right? The agreement should expressly say so and have an express indemnification and hold harmless clause by who - Barclay's or Ygrene? According to Ygrene's bond counsel, neither the district nor the member cities have any liability to the bond holders. All sources of capital for the program are private. There is no financial obligation for the district or_the member cities. State PACE law requires that the cities execute the financing agreements with the property owners that authorize the assessments and the priority tax liens. Counsel for the district can explain this in detail. Will the consumer be able to prepay, in whole or in part, the amount of the assessment lien, for whatever reason, with or without penalty? Yes. Under the current contract in the District, assessments may be prepaid at any time without penalty. Will the installed products contain a manufacturer's warranty - for how long and will that be labor and parts, replacement or actual cash value? Installed products will carry offered manufacturer's warranties. If parts and labor are provided in the warranties, they will carry over to the property owners. Contractors will be responsible for defects in materials and workmanship.. Will the installed products, particularly the solar panels, be insurable through windstorm or homeowner's insurance (we are talking mainly Citizens Insurance in PB), and if not what insurance will be available to consumers? •Installed products will be insurable for wind and other casualty loss on the same basis as other property improvements in the area. Ygrene is exploring additional insurance that will cover investors who purchase bonds secured by PACE assessment liens. • Company Confidential 10 1 E e Confirm that the District costs for administration, legal and any employees will be paid from a portion of. the fee/tax collected and no out of pocket to participating municipalities. and Cutler True. Cutler Bay paid the cost for the initial District staff (Cutler Bay Town Manager Bay Town Attorney) by in kind contribution. Ygrene will not look to the District or participating municipalities for any cost reimbursement and has agreed to indemnities in accordance with the contract. Confirm municipal appointees to Directorship of district governing board will not be compensated. R. The District directors will not be compensated to serve on the Board. Who is Ygrene? Ygrene Energy Fund Florida is a Florida limited liability company with headquarters offices in Tampa. The firm- is a joint venture between Eco2Asset Solutions, a wholly owned subsidiary of Florida's Lykes Bros. Inc., and Ygrene Energy Fund, a Delaware corporation headquartered in Santa Rosa, CA. • Formed in 2008, ECO2ASSET SOLUTIONS specializes i�i.sustainability advisory; analysis and management for government, corporations, higher education and large landowners. The company is committed to delivering solutions for these organizations with, a focus on recommending sustainability investments that have cost benefit and return on investment. Ygrene Energy Fund, conceived by businessman, Dennis Hunter, in 2008, offers third party administration and funding resources for PACE programs in jurisdictions throughout the United States. With initial contracts in Sacramento, CA and Miami -Dade County Florida, the company is working to expand the promise of property assessment secured financing in the battle to create jobs, improve floundering local economies and reduce greenhouse gas emissions. How was Ygrene selected to administer the Green Corridor program? The Town of Cutler Bay, on behalf of the district, initiated a legally proper public request for proposals. Ygrene was selected based upon its qualifications, the quality of its program and its funding capabilities. As part of its response to the RFP, Ygrene suggested steaming with other potential bidders to affect a final solution. Company Confidential Can local contractors, lenders and other stakeholders participate in Ygrene PACE programs? Above all else, programs administered by Ygrene are local and inclusive. They start with a commitment from the local political bodies to form a PACE district and complete a judicial validation that insures the program's legal status. Once established, Ygrene engages with local .stakeholders in the following ways: Ygrene trains and certifies all interested andqualified local contractors. Participants have access to administrative and audit software tools, lead management, Ygrenefunded marketing outreach and all other program services. Most importantly, contractors can offer readily available, pre - qualified financing to their customers fdr the full cost of the'installed projects. Property owners who prefer to work. with their local lender are free to do so under Ygrene's inclusive financing programs. Properly underwritten, assessments may be funded by a bank or lending institution of the property owner's choice under term's that are agreedupon between them. 'Ygrene has provided indemnities in connection with its eration of the Green Corridor program. Given that it is a new and relatively small corrfpanl;';,how does it intend .to meet these obligations? • As .the assessments grow, Ygrene will provide a reserve or bond to cover potential litigation costs. Once the program reaches 500 assessments, Ygrene and the District -board will re- evaluate the actual risk and develop additional, mutually agreeable indemnity insurance. • Bond counsels for Ygrene, the City of Sacramento, CA and the Green Corridor District have each determined that there is no direct exposure to the financial assets of the District or its member cities from the program. This includes risk to the general fund or other assets of the members, as well as collection risk associated with ultimate bond issues secured bythe assessment liens. • While it is exceedingly unlikely, should a constitutional challenge to the priority assessment liens authorized by SB7179 prevail, it is equally unlikely that Rreviously approved assessments would be overturned by such adverse constitutional decision. The law is based on more than 100 years of legal precedent, which obviously has not been reversed in all that time. Company Confidential 12 Further, Ygrene believes the risk of litigation to the Green Corridor District is small and that the company is fully, capable of meeting the financial obligations of its indemnities. The following facts support this position: • Ygrene Energy Fund Florida is a joint venture between Eco2Asset Solutions of Tampa and Ygrene Energy Fund of Santa Rosa, CA. While Ygrene provide's the program expertise and funding sources for the program, Eco2Asset, as a wholly owned subsidiary of Lykes Bros. Inc., brings considerable financial strength to the company. no litigation. Sonoma County, CA has been operating two and a half years, providing assessment financing nearly $60 million. It has not had to defend any faults. • Operating programs have experienced the largest program in the country for for more than 1500 projects totaling tax de lawsuits and there have been no Property owners work directly with contractors to complete the projects that are financed by the program. Ygrene acts much like a construction lender, verifying completion of the improvements prior to funding but otherwise,'not.involved in the relationship between contractors and property owners. What assurances doproperty owners have that funded projects will be cost effective? Through Ygrene, the Green Corridor District has implemented the following program elements to help property owners evaluate the cost effectiveness of the energy efficiency and renewable energy components of their projects: • Based upon the results of an on -site energy audit, funded projects must achieve a Savings to Investment Ratio (SIR) of greater than 1. This means that the energy savings potential of the installed components will exceed the cost of the improvements over their useful life. • Ygrene provides commercial and multi -family residential contractors access to insurance that allows them to guarantee that installed components will achieve predictedenergy savings. ((over 20 years? From who?)) • While higher than current residential mortgage rates, Green Corridor District interest rates are low (initial rates of 7.0% or less), repayment terms are long (up to 20 years) and the program will finance 100% of the cost of the improvements. Typical private bank financing might be 4% (?) on a second mortgage with a repayment term of 10 years with no assistance on finding and vetting a bonifide contractor and product. (for example) • The combination of terms is considerably better than anything that is currently available to most homeowners. It is also considerably more attractive than programs offered by solar vendors. ........ • For commercial property owners, Green Corridor District financing solves many of the problems that deter businesses from making energy saving improvements. These problems include competing cash needs, impacts on credit, balance sheet issues, and, for rental properties, the dilemma of tenant -paid utility expenses. 13 Company Confidential Is it true that solar energy components used now are proposed to be obsolete due to technology in less than seven years? This is simply not true. Existing solar panel technology will continue to perform as rated for 35 years or more. What if deterioration of the structures occurs prior to pay-off of the assessment over the 20-year amortization period? While technology will improve and costs will come down, this phenomenon is true for nearly every commodity. Installed systems have value throughout their useful life. Could the technology become obsolete or fall into disrepair,, meaning any benefit could be lost after a number of years? Would the utilization of the program stop being a long -tern benefit and become a tax burden to the property owner? If a property owner installs a 2.5 kW system, it will provide electricity for the home for its lifetime. If the economics of the installation make • sense for thet property owner at the outset, they will only improve over time as inflation acts on the price of electricity. Interest rates are actually very low right now, and ,with the interest charged by the District, plus administrative costs, what is she bei eret to participate in the District to finance the improvements? There are a lot of reasons to use PACE financing. Following are a few: Pre -approval in seconds • Quick, easy underwriting with no credit hassles • 100% financing • Long-term amortization with low annual payments • Administrative and loan costs are much lower than commercial lenders • For commercial property owners, it solves the split incentive and capital competition, problems. Would Lloyds of London or any other insurance company have a first priority lien prior to the District? Lloyds of London has nothing to do with Yarene's program. Ygrene has a relationship with a subsidiary of Hannover. Re, the second largest reinsurance underwriter in the world, to offer insurance to contractors that will allow these contractors to guarantee the energy savings to property owners. Company Confidential 14 s c YGRENE ECONOMIC IMPACT ANALYSIS Ygrene has evaluated the impact that a successful PACE program can have on various municipalities. The •following values reflect these approximated economic and environmental effects on the city of Miami: • 34.7 MW electricity generation from .renewable sources • Over 20,000 tons CO-, emissions avoided • Over 2,500 jobs created • $17.8 million in state and local tax revenue • $27.8 million in federal tax revenue • $447 million in total economic output These values are based on 3.5% penetration of the estimated residential and commercial markets of the city of Miami within the first five years of the program. The two primary sources of data used in this analysis, were the report Economic impact Analysis of Property Assessed Clean Energy Programs (PACEYby ECONorthwest, and the project database for the Sonoma County Energy Independence Program (SCEIP.) The ECONorthwest report, as well as an overview of SCEIP, is included in the appendices. The ECONorthwest report calculates the direct, indirect, and induced impacts associated with a specific amount of PACE spending within a municipality. The IMPLAN economic forecasting model was used to measure the total aggregated effect of PACE purchases both on a local and national level. The entirety of this report is included in the appendices. Company Confidential 15 %,S1K..:Y"n:'%•rlf!f"Sd i{{:£ti?iaF': P'F. iri3f.',i+�:i';�ta?S 7v� zR-"^: hFiami, FL Marl;efAnalysis. Population (2010 Census) 399,457 County Miami -Dade Public Electric Utility Florida Power & Light State RPS None Est. Annual GHG Emissions) 6,351,3'66 mtCO2e Residential Commerciale Occupied Housing Units 69,185 # Buildings i Median Home Value $261,400 Total Area t % Homes with Mortgage 62% 12,105 108,652,304 sq ft E Total Market Market Scenarios (5 years) Market Penetration Residential Commercial Project Total Economic Output # Projects Project Value Residentialy Commercial Project Total, 1.4% (SCEIP) 23,442,983 $ 44,710,561 $ 68,153,544 S 180,397,694 69,185. $ 12,105: $ 81,290.•S 3.5% 2,156,996,441 2,669,955,937 4,826,952,378 7% 150,989,751 186,896,916 337,886,666 894,362,523 Additional Stimulus @ 3.5% Market Penetration (5 years)3 POWER GENERATION (MW) CO2 REDUCTION"(mtco2e) sarrn'�v. Residential • 0 5 10 15 20 25 30 35 40 EST. STATE/LOCAL TAX REVENUE (millions) $5 $ 0 $15 $20 om dal F is -gym' eResrdential r. 0 - 5K 10K 15K JOBS CREATED 20K 25K 0 500 1,000 1,500 2,000 2,500 3,000 1Ernissions based on state mtCO2e per capita value from the World Resources Institutes Climate Analysis Indicator Tool (CAIT) 2Commercial est. based on population, ft2/person multiplier supplied by Pike/CoStar, and avg. building size, of 14,900 ft2 3Charts based on investment multiplier contained in ECONorthwest's report entitled "Economic Impact Analysis of Property Assessed Clean Energy Programs (PACE)" that utilizes the lIviPLAN economic model to estimate total economic impact SCEIP data based on Sonoma County projects from 9/2009 to 5/2011 `and scaled to target market size and makeup Sources: US. • Census Bureau, US Environmental Protection . Agency, `Pike Research,' CoStar Group; .'City-dato.-com, Sonoma County Energy Independence Program (SCEIP),--World Resources Institute, ECONcrthwest Company Confidential © Ygrene Energy Fund 2011 900 College Ave. Santo Rosa, CA 95404 www.ygre.ne-energy.com 16 THIRD PARTY ADMINISTRATION AGREEMENT BETWEEN THE TOWN OF CUTLER BAY AND YGRENE FLORIDA ENERGY FUND LLC THIS AGREEMENT (the "Agreement") is entered into as of the 1j day of 2011 (the "Effective Date"), by and between the Town of Cutler Bay (hereinafter, th "Town") and Ygrene Florida Energy Fund, LLC, a Florida limited liability company with principal offices in Tampa, Florida (hereinafter "Ygrene" or "Administrator"). WHEREAS, section 163.08, Florida Statutes, (the "PACE Act") provides and allows for providing funding and financing for certain clean energyrenewable energy and wind resistant qualifying improvements and .associated programs by local governments ("PACE program"); and WHEREAS, Administrator has proposed to develop and desires to implement and administer programs providing planning, development, financing, marketing, and management for efficient, effective and voluntary PACE programs; and WHEREAS, Town will partner with one or more other local governments to create a separate legal entity under section 163.01(7)(g), Florida Statutes, (the "District") for purposes of offering a PACE program to constituents of the member governments thereof; and WHEREAS, the Town and Administrator are prepared to enter into this Agreement with the understanding that the Town will shortly create and establish the District with one or more other local governments by interlocal agreement and assign this Agreement to the District; and WHEREAS, upon any assinment, all references to the Town herein shall be deemed to refer to and bind the District, unless the context clearly indicates otherwise. NOW, THiK;REFORE, in consideration • of. the foregoing premises, which are hereby incorporated into this Agreement as integral parts hereof and not mere recitals hereto, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Administrator and the Town agree as follows: 2. Scope of Services. 1.1 The Administrator shall undertake activities, furnish professional services, perform tasks, and provide deliverables (the "Services") as the exclusive third party administrator of the PACE prob am for the District, generally as described in the Functions and Responsibilities for Green Corridor PACE District, attached hereto and made a part hereof as Exhibit "A" (the "Proposal"). 1.2 In the event the District wishes to expand or otherwise enhance the PACE program services provided by Administrator under 'the Agreement, and the Administrator determines that it is linable or unwilling to fulfill the requirements of the expanded 'services;- then, the. exclusivity providedin paragraph 1.1 above notwithstanding, the -District-may, without interference with Administrator's rights and obligations under the 1. 2.1 Agreement, engage other vendors for the sole purpose of providing the expanded services. Term/Commencement Date. On the Effective Date, the Administrator will commence implementation of those Services required to (i) assist in the formation of the District; (ii) assist in attracting sufficient District membership that the aggregate population of the District is 500,000 or more; and (iii) assist the District to complete successful bond validation for the District. The following shall be conditions precedent to the commencement of additional services by the Administrator: (i) fonnation of the District; (ii) an aggregate population of at least 500,000 in the District; and (iii) successful bond validation of the District program (the "Commencement Conditions"). Nothwithstanding the foregoing, the Administrator, in its discretion, may agree, in writing, to less than an aggregate population of 500,000 within the District. In the event that the Administrator agrees, in writing, to less than an aggregate population of 500,000 within the District, number (ii) of the Commencement Conditions shall be considered satisfied. 2.2 The Administrator will commence provision of the remainder of the Services within ten calendar days following fulfillment of the Commencement Conditions (the "Commencement Date"). 2.3 The Agreement shall remain in effect for five (5) years from the Commencement Date (the "Initial Term"), and shall automatically renew for successive five (5) year Tennis, unless terminated as provided in Section 8 herein. 2.4 The Parties agree that time is of the essence and each party will cooperatively act to advance completion of the Commencement Conditions. - 3, Consideration. 3.1 As consideration for entering into this agreement, and for its perfoiniance hereunder, Administrator shall be entitled to impose and collect fees and charges in accordance with the Proposal. Such consideration recognizes that Administrator will not receive or collect fees or charges from the District for its services. 4. Sub consultants. 4.1 The Administrator shall be responsible for all payments to any third party subcontractors, service providers or sub consultants that are reasonably related to this Agreement, and shall maintain responsibility for all work related to the Services. 4.2 The District acknowledges and agrees to the Administrator's use of the sub consultants ', submitted in response to the Town's Request for Proposals, authorized pursuant to 'Resolution 10-68. The District acknowledges that Administrator may also use and employ other vendors, underwriters, providers, 'consultants, advisors or counsel in the development and administration of its work product and services over time. Whenever Administrator determines to use such other assistance, it shall notify the District and seek its prior approval in writing, provided, however, such approval shall not be unreasonably withheld. Failure 'by the District to respond to such requests of Administrator, in writing, within 30 business days of submittal, and delineate specific reasons for refusal, shall be deemed approval. This time frame may be extended by mutual agreement of the parties. 4.3 Nothing in this Agreement shall prevent Administrator from performing similar PACE program services in other jurisdictions, either within or outside the State of Florida. 5. District Responsibilities 5.1 Upon acceptance of assignment of this Agreement from the Town, the District shall assume and undertake all of the obligations and responsibilities under the Agreement. 5.2 The District and its constituent local govenunent members ("Members") understand that the Florida law authorizing PACE programs reserves authority and responsibility for establishing the program and executing financing agreements with property owners to local government. Consequently, the District and/or the Members, as appropriate, shall timely take the following actions: a. Authorize and adopt resolutions and/or ordinances required to implement the program; b. Adopt resolutions and approve documents authorizing the Administrator to commence legal proceedings on behalf of the District to validate program related obligations and to engage counsel for the purpose; c. Within a reasonable time following submittal by Administrator, execute documents required by the PACE Act including, but not necessarily limited to, financing agreements; d. Other actions required by the PACE Act and/or financing authorities to be perfomned by the governmental jurisdictions sponsoring the PACE program. 6.. Administrator's Responsibilities 6.1 The Administrator shall exercise the same degree of care, skill and diligence in the performance of the Services as that ordinarily provided by an administrator under similar circumstances. If, at any time during the term of this Agreement, it is determined that the Administrator's' deliverables or services are incorrect, not properly rendered, defective, or fail to conform to the requirements of law, upon written notification on behalf of the District, the Administrator shall at Administrator's sole expense, immediately correct the work. .6.2 Administrator shall require contractors to exercise a high level of skill and integrity in . the installation ._;of. PACE .improvements in the District. To . this end, participating contractors .wi11Tbe, required to (i) insure that roof structures are adequate.... and_.__,.. appropriate for installation of roof -mounted photovoltaic systems; (ii) comply with Administrator's guidelines for the removal and disposition of CFC's .and other greenhouse gases; (iii) apply best commercially reasonable industry standards in the installation of all improvements financed under the program; and (iv) attend training programs designated by Administrator from time to time. 6.3 Administrator shall establish procedures that account for and accrue the carbon credits that result from projects financed under the District PACE program. The Administrator and the District shall equally split the ownership of carbon credits accounted for. and accrued within the District. Therfore, for every 2 carbon credits accounted for and accrued within the District, the District will own one carbon credit and the Administator will own the other carbon credit. 6.4 The Administrator hereby warrants and represents that at all times during the term of this Agreement it shall maintain in good standing all required licenses, certifications and permits required under Federal, State and local laws applicable to and necessary to perform the Services as an independent contractor. 7. Disclosure/Conflict of Interest. 7.1 So long as Administrator fulfills its obligations to provide the Services, District acknowledges and agrees that Administrator, its sub consultants or any other provider, vendor, consultant, underwriter, or third party used or employed by Administrator, is permitted, individually or collectively, to advance without conflict any other PACE program, or assist any other PACE program sponsor, and that there is and shall be no objection by the District to such actions. 7? The Administrator agrees that neither it nor its sub consultants shall represent any persons or entities in any action before the District. 8. Termination. 8.1 Following the Initial Term, either party may notify the other of its intent to terminate the Agreement. In such event, the Agreement will terminate on .the second (2' ) anniversary of the termination notice, at which date Administrator shall cease providing the Services. 8? In the event the District terminates the Agreement under the provisions of paragraph 8.1 above, Administrator shall be entitled to continue to offer the Services during the transition period so long as (i) Administrator does not approve any projects, completion of which will extend beyond the termination date; (ii) Administrator provides for on- going management of assessments related to any projects completed under Administrator's auspices; (iii) Administrator continues to provide all of the Services in a professional manner in accordance with the Agreement; (iv) Administrator continues to. work --good' faith with the District to provide a smooth transition for either the termination ofthe program or transfer to another administrator. 8.3 The District and Administrator acknowledge and agree that, as of the Effective Date, the Commencement Conditions have not been satisfied. The Town and Administrator agree that time is of the essence and each party will diligently and cooperatively act to satisfy the Commencement Conditions and advance Administrator's delivery of the Services within the timeframes and sequences set forth herein. Should the Commencement Conditions not be satisfied within one year following the Effective Date, Administrator may, in its sole discretion, cancel the Agreement by written notice to the District, in which case it shall be mill and void and of no further force or effect. 8.4 In the event that (i) conditions in U.S. financial markets, (ii) changes in PACE law, or (iii) changes in District's authority to provide assessment lien priority render PACE financing infeasible, Administrator may suspend the program for a period of up to six months. Should the Administrator determine at the conclusion of the suspension period that conditions do not warrant resumption of the program Administrator may request from the District an extension of the program suspension for an additional six months. The District may, at its option, grant the extension or cancel the Agreement. • 8.5 A breach of this Agreement shall mean a material failure to comply with any of the provisions of this Agreement. If any party breaches any obligation herein, then, upon receipt of written notice by the non -breaching party, the breaching party shall, within 30 days after receiving written notice of such breach, proceed diligently and in good faith to take all commercially reasonable actions to cure such breach and shall continue to take all such actions until such breach is cured. Unless otherwise provided herein, the parties to this Agreement may proceed at law or in equity to enforce their rights under this Agreement. 9. Nondiscrimination. 9.1 During the tern of this Agreement, Administrator shall not discriminate against any of its employees or applicants for employment, if any, because of their race, age, color, religion, sex, sexual orientation, national origin, marital status, physical or mental disability, or political affiliation and to abide by all Federal and State laws regarding nondiscrimination. 10. Attornev's Fees and Waiver of Jury Trial. 10.1 In the event of any litigation arising out of this Agreement, the prevailing party shall be entitled to recover its attorneys' fees and costs, including the fees and expenses of any paralegals, law clerks and legal assistants, and including fees and expenses charged for representation at both the trial and appellate levels. 10.2 In the event of any litigation arising out of this Agreement, each party hereby knowingly, irrevocably, voluntarily and intentionally waives its right to trial by jury. 11. Indemnification. 11.1 Administrator shall defend, indemnify, and hold harmless the District, its officers, agents and employees, from and against any and all demands, claims, losses, suits, liabilities, causes of action, judgment or damages, arising out of, related to, or in any way connected with Administrator's performance or non-performance of any provision of this Agreement, including, but not limited to, liabilities arising from contracts between the Administrator and third parties made pursuant to this Agreement. In addition, the foregoing obligations shall expressly include all demands, claims, losses, suits, liabilities, causes of action, judgment or damages, arising out of, related to, or in any way connected with the voluntary non -ad valorem assessments constituting a lien of equal dignity to taxes as authorized by the PACE Act. The obligations provided for in this paragraph shall exclude liability resulting from acts of, or, failure to take action by, the District, its officers, agents and employees. The District shall promptly notify the Administrator of any claim giving rise to a right to indemnity and shall fully cooperate with the Administrator in defense of such claims. So long as the Administrator has agreed that the District is entitled to indemnification, the Administrator shall have the right to control the defense of the claim, including, without limitation, the right to designate counsel and to select a single counsel to jointly represent the interests of the District and the Administrator (unless an actual present conflict would preclude joint representation) and including the right to control all negotiations, litigation, arbitration, settlements, compromises, and appeals of the claim. The District shall cooperate in defense of the claim and may, but is not required to, retain at its cost additional separate counsel to participate in or monitor the defense of the claim by Administrator. 11.2 Administrator shall indemnify the District and the Members from and against collection risk related to the bonds issued for PACE assessments in the District. In the event of a property tax default by the owner(s) of any property against which a District PACE assessment has.been recorded, Administrator agrees to purchase the. tax hen certificate. 11.3 Administrator agrees that the indemnification provisions provided for in Section 11.1 above shall extend to any Member of the District. 11.4 The provisions of this section shall survive termination of this Agreement. 12. Notices/Authorized Representatives. 12.1 Any notices required by this Agreement shall be in writing and shall be deemed to have been properly given if transmitted by hand -delivery, by registered or certified mail with postage prepaid return receipt requested, or by a private postal service, addressed to the parties (or their successors) at the following addresses: For the Town: Steven J. Alexander, Town Manager Town of Cutler Bay 10720 Caribbean Boulevard, Suite 105 With a copy to: For the Administrator: Cutler Bay, Florida 33189 Mitchell Bierman, Esq., Town Attorney Weiss Serota Helfinan Pastoriza Cole 8 Boniske, P.L. 2525 Ponce de Leon Blvd. Coral Gables, Florida 33134 Dan Schaefer Ygrene Florida Energy Fund, LLC 400 N Tampa St 2200 Tampa, FL 33602 12.2 Either party may, by notice in writing given to the other, designate any further or different representatives or addresses to which subsequent notices, certificates or other communications shall be sent. Any notice shall be deemed given on the date such notice is delivered by hand. (or confiiiued electronic facsimile transmission) or three (3) days after the date mailed. 12.3 Each party shall be entitled to reasonably rely upon direction or communication received from the above designated representatives or any successor or additional designees. 13. Governing_ Law. 13.1 This Agreement shall be construed in accordance with and governed by the laws of the State of Florida. Venue. for any litigation arising out of this Agreement shall be . exclusively in the proper court in Miami -Dade County, Florida. 14. Entire Agreement/Modification/Amendment. 14.1 This writing contains the entire Agreement of the parties and supersedes any prior oral or written representations. No representations were made or relied upon by either party, other than those that are expressly set forth herein. 14? No agent, employee, or other representative of either party is empowered to modify or amend the terms of this Agreement, unless executed with the same formality as this document. 14.3 Administrator represents that it is authorized to do business in the State of Florida. The execution, delivery and performance of this Agreement by Administrator has been duly authorized, and this Agreement is binding on Administrator and enforceable against Administrator in accordance with its terms. No consent of any other person or entity to such execution, delivery and perfouuance is required. 15. Ownership and Access to Records and Audits. 15.1 The parties acknowledge that all inventions, innovations, improvements, developments, methods, designs, analyses, drawings, reports and all similar or related information (whether patentable or not) which relate directly to PACE District program Services and are conceived, developed or made by Administrator or District, directly for the PACE District program during the term of this Agreement, are deemed to be within the public domain, and subsequently may be used by each party without warranty of any kind. 15.2 All records, books, documents, maps, data, deliverables, papers and financial in±onniation associated with the District PACE program to be administered by Administrator (the "Records") are public records and shall be available to be inspected and copied by the District. In the event of public record requests, all such requests shall be administered and handled by the District as the custodian. 15.3 The District, by its designee, shall, during the teen of this Agreement and for a period of three (3) years from the date of termination of this Agreement, have access to and the right to examine and audit any of the Records. 15.4 After notice and reasonable opportunity to cure, the District may cancel and terminate this Agreement for refusal by the Administrator to comply with the requirements of Chapter 119, Florida Statutes (Public Records). 16. Assignment. 16.1 The parties agree that this Agreement shall be assigned to the District upon the Town and one other local government joining the District. This Agreement shall not be assignable by Administrator unless such assigrunent is first approved, in writing, by the District, or its duly authorized representative, which approval shall not be unreasonably withheld. 17. SeverabiIity. 17.1 In case any one or more of the provisions contained in this Agreement should be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or unpaired thereby. The parties shall endeavor in good faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provision. 18. Independent Contractor. 18.1 The Administrator shall be and remain an independent contractor and not an employee, partner, agent, joint venture or principal of District with respect to all of the acts and services performed by and under the terms .of this Agreement. Accordingly, neither party shall have any authority to represent or bind the other. Further, Adrriinistrator shall not be entitled to the rights and benefits afforded to "District's' eniplbyees, including; but,- not limited to, . disability . or:..unemployment .insurance, . workers' compensation, medical or disability insurance, vacation or sick leave or any other employment benefit. Administrator shall file all tax returns and reports required to be filed by Administrator on the basis that Administrator is an independent contractor, rather than an employee, and Administrator shall indemnify the District for the amount of any employment taxes required to be paid by the District as the result of not withholding employment taxes from the compensation under this Agreement. This Agreement shall not in any way be construed to create a partnership, association or any other kind of joint undertaking, enterprise or venture between the parties. 19. Compliance with Laws. 19.1 The Administrator shall comply with all applicable laws, ordinances, rules, regulations, and lawful orders of public authorities in carrying out Services under this Agreement, and in particular shall obtain all permits from all jurisdictional agencies to perform the Services under this Agreement. 20. Waiver 20.1 The failure of either party to this Agreement to object to or to take affiuhuative action with respect to any conduct of the other which is in violation of the terms of this Agreement shall not be construed as a waiver of the violation or breach, or of any future violation, breach or wrongful conduct. 21. Survival of Provisions 21.1 Any terms or conditions of this Agreement that require acts beyond the date of the term of the Agreement, shall survive termination of the Agreement, shall remain in full force and effect unless and until the teams or conditions are completed and shall be fully enforceable by either party. 22.. Prohibition of Continaencv Fees. 22.1 The Administrator warrants that it has not employed or retained any company or person, other than a bona fide employee working solely for the Administrator, to solicit or secure this Agreement, and that it has not paid or agreed to pay any person(s), company, corporation, individual or firm, other than a bona fide employee working solely for the Administrator, any fee, commission, percentage, gift, or any other consideration, contingent upon or resulting from the award or making of this Agreement, except its attorneys, accountants and consultants. 23. Public Entity Crimes Affidavit 23.1 Administrator shall comply with Section 287.1.33, Florida Statutes (Public Entity Crimes Statute), notification of which is hereby incorporated herein by reference, including execution of any required affidavit. . 24. :.Insurance. 24.1 Administrator shall secure and maintain throughout the duration of this Agreement, insurance of such type and in such amounts necessary to protect its interest and the interest of the District against hazards or risks of loss as specified below. The underwriter of such insurance shall be qualified to do business in Florida, be rated AB or better, and have agents upon whom service of process may be made in the State of Florida. The insurance coverage shall be primary insurance with respect to the District, its officials, employees, agents and volunteers. Any insurance maintained by the District shall be in excess of the Administrator's insurance and shall not contribute to the Administrator's insurance_ The insurance coverage shall include a minimum of the amounts set forth in this Section. 24.2 Comprehensive Automobile and Vehicle Liability Insurance This insurance shall be written in comprehensive fou n and shall protect the Administrator and the District against claims for injuries to members of the public and/or damages to property of others arising from the Administrator's use of motor vehicles. The limit of liability shall not be less than $500,000.00 per occurrence, combined single limit for Bodily Injury Liability and Property Damage Liability. 24.3 General Liability Insurance This insurance shall be written in comprehensive form and shall protect the Administrator and the District against claims arising from injuries to members of the public or damage to property of others arising out of any act or omission to act of the Administrator or any of its agents, employees, consultants, business partners or subcontractors. The limit of liability shall not be less than $1,000,00100 per occurrence, combined single limit for Bodily Injury Liability and Property Damage Liability. 24.4 Certificate of Insurance Administrator shall provide the District with Certificates of Insurance for all required policies. The Certificates of Insurance shall not only name the type of policy(ies) provided, but also shall refer specifically to this Agreement and shall state that such insurance is as required by this Agreement. The District reserves the right to require the Administrator to provide a certified copy of such policies, upon written request by the District. If a policy is due to expire prior to the completion of the term of this Agreement, renewal Certificates of Insurance or policies shall be furnished thirty(30) calendar days prior to the date of their policy expiration. Each policy certificate shall be endorsed with a provision that not less than thirty (30) calendar clays written notice shall be provided to the District before any policy or coverage is cancelled or restricted. Acceptance of the Certificate(s) is subject to approval of the District. 24.5 Additional Insured The District is to be specifically included as an Additional Insured for the liability of the District resulting from operations performed by or on behalf of Administrator in performance of this Agreement. Administrator's insurance, including that applicable to the District as an Additional Insured, shall apply on a primary basis and any other insurance maintained by the District shall be in excess of and shall not contribute to Administrator's insurance. 25. 24.6 'Deductibles All deductibles or self -insured retentions must be declared to and be approved by the District or its duly authorized representative. The Administrator shall be responsible for the payment of any deductible or self -insured retention in the event of any claim. Counterparts 25.1 This Agreement may be executed in several counterparts, each of which shall be deemed original and such counterparts shall constitute one and the same instrument. 26. Miscellaneous 26.1 In the event of any conflict or inconsistency between the terns of this Agreement and the teiuis of the Proposal, the terms of this Agreement shall govern. IN WITNESS WHEREOF the parties hereto have executed this Agreement on the day and date first above written. TOWN: TOWN OF CUTLPR—BAY YG ' FLORIDA ENERGY _FUND, LLC. 2005 Ste n J. Alexander, Town Attest: (,.� Town Cleric Approved as to Form and Legal Sufficiency: By: Town Attorney TISTRATOR: Bv: Dennis R. Hunter, Manager Dart M. Schaefer / anager EXHIBIT A THE PROPOSAL - Functions and Responsibilities' for Green Corridor Property Assessment Clean Energy (PACE) District (the "District") Ygrene proposes, in cooperation with Town and/or District to provide PACE administration and financing services to the District in accordance with the following: I. TASK LIST Task 1: Design Localization Task 1.1: PACE Enabling Ordinance via District Interlocal Agreement The first required action item is a procedural ordinance and/or authorizing resolution. Consistent with the Florida law and Section 163.08, Florida Statutes (the "PACE ACT"), Ygrene and its. qualified Connsel ("Counsel") will provide a comprehensive set of documents that include, by way of example, the following components: • • A determination that the establishment of the program would be in the public interest as required by the law. • A statement indicating that the jurisdiction proposes to make voluntary contractual non -ad valorem assessment ("PACE Assessment") financing available to property owners. • An identification of the types of renewable energy sources, wind resistance and energy efficiency improvements ("Qualifying Improvements") that may be financed. • A description of the boundaries (including a map) of the area within which contractual assessments may be offered. • A description of the proposed financing program. • Designation of a date, time and place for the public hearing on the matter, if required. • A statement of assessment underwriting standards that is consistent with HB7179, reflects the legitimate concerns of mortgage lenders and cognizance of the secondary mortgage market, is designed to ensure appropriate capital markets participation, and forms the basis for Florida to demonstrate a PACE financing program that provides a.model for use in other states. • Consultation with the appropriate county officials to ensure arrangements for placing the assessments on the tax roll and all the necessary documentation. • Under the direction of Willdan Financial Services, Barclays Capital and Counsel, development of standard or uniform protocols to create and maintain non -ad valorem assessment rolls, and transfer proceeds to cover debt service and associated program costs. Task 1.2: PACE Report Pursuant to adoption of a procedural ordinance and/or authorizing resolution for the District, Ygrene. will provide a Report that will contain matters sufficient to fulfill legal requirements including: • -'Pi-ogram Jurisdiction: Description, map or diagram indicating • the boundaries where ,PACE assessments can be legally offered. 1 o Draft Financing Agreement: A draft form of financing agreement consistent with the PACE Act and anticipated market acceptance specifying the terms and conditions for a property owner to fund and finance Qualifying Improvements. The final form of financing agreement will be subject to approval and execution by appropriatelDistrict officials -and Counsel. • Policy Statement: Please reference Task 1.3 for a detailed account of what this task entails. a District's PACE Finance Plan: A description of the funding source(s) to be offered through the District for work financed by the voluntary non -ad valorem assessment under the program. Ygrene will rely on Counsel for legal analysis and advice as to the best means and methods to achieve program validity and address legal matters related to the assessments and the bonds to be issued. The Finance Plan may delineate amounts to be advanced based on funds available to the local government from any source, and may include the issuance or sale of bonds, obligations, or other financing arrangements. The Finance Plan shall include a method for determining the interest rate and time period during which affected property owners would pay any assessment. The Finance Plan will provide for the establishment of any necessary reserve fund or funds, and will provide for the apportionment of all or any pordon of the costs incidental to financing, administration, and collection of the assessments among the consenting property owners and other matters necessary to attract funding and financing. ▪ Payment Schedules: Based upon information provided by the District, Ygrene will create and provide payment schedules, to both the District and affected property owners, that identify the amount and timing of payments to be made during the agreed upon term of the assessments based upon the program interest rate. This schedule will be the basis for the assessment installments that will be submitted annually to the appropriate county tax collector for inclusion on property tax bills. • Assessment Applicant Criteria for the Approval/Denial Process: Applicant qualification requirements will be determined based upon the State Law and underwriting guidelines. County Tax Roll Results Report: Ygrene will prepare and periodically update a report on the results of consultations with appropriate county officials concerning arrangements and additional fees, if any, to be charged for placing the PACE assessments on the property tax bills. Task 1.3: PACE Policy Statement Ygrene and Counsel will provide the District with draft policies for use in contractual assessments between the District and property owners for financing of Qualifying Improvements. These policies will be a requirement of the program and must be adopted by the District to be effective. The policy statement will include, but is not limited to, the following: Authorized Officials: The governing body of the District will identify and delegate power to the local official(s), or designee(s), who are authorized to enter into financing agreements with participating property owners. Procedures shall provide, among other requirements, for timely execution of financing agreements. Project Identification: Ygrene will identify the types of properties authorized to be included in the program, i.e. residential, commercial/industrial. Ygrene will provide and propose a comprehensive list of Qualifying Improvements that may be financed through the program. Method for Prioritizing Property Owner Requests: Unless otherwise directed by the District and subject to financial underwriting guidelines, Ygrene will process and prioritize property owner requests for participation -in the program on a first -come, first -served basis, without regard to size of project. or type of r o ert Program Timelines: Ygrene will specify various program timelines, including deadlines for setting up the District program. Additionally, Ygrene will set performance goals for such program components as application processing, approval notification, assessment processing, project funding and other customer service related guidelines. Task 1.4: Program Forms Ygrene will provide a portfolio of program foams (bi-lingual) to be used by residents who wish to participate in the program. These forms will also be provided on the District's website, and may include: • PACE Frequently Asked Questions (FAQ) • Schedule of Fees • List of Qualifying Improvements • Assessment Underwriting Terms • Application & Documentation Checklist • Application Form • Financing Agreement • Truth-ln-Lending Form • FHFA/FNMA/FMAC PACE Status Disclosure Form • Lender Notification (Residential Properties) • Lender Notification and Acknawledgement (Commercial and Industrial Properties) • Project Bid and Contract Faun • Funding Request Checklist • Utility Authorization Form • Closing Checklist Task 1.5: PACE Presentation to District Directors (from 1.2) Once the program elements are completed and approved by the District, Ygrene will assist staff in presenting such information and materials to the District board, will prepare and suggest the related staff report, and participate in the required public hearing. Task 1.6: Update and Amend PACE Report As necessary, in a manner consistent with the PACE Act, and as directed following the public hearing, Y.ene will -make requested changes and/or amendments to program elements. TASK 2: Marketing Task 2.1: Establish a Community Outreach and Participation Plan Ygrene will implement the four -step marketing plan for the District: Step 1: Contractor Certification: Ygrene will train and certify contractors as a prerequisite to their participation in the program, The certification approach utilizes State standards, nationally recognized programs and systems training. Ygrene's training program emphasizes customer service, market outreach, technical expertise and professionalism. Step 2: Property Segmentation: Based on data analysis and statistical modeling, Ygrene can segment District properties into groups based on age, geographic location, assessed value and other attributes. This provides the basis for a District outreach program for each group of properties that utilizes the internet, local media and -local canvassing .with a targeted message. - Step3: Localiied:District 'Website Portal:.. Ygrene's- WebTool :provides options that allow the District to localize the user experience and to• establish a message that is consistent with 3 local political and economic development objectives. Ygrene works with staff prior to setting up and launching the localized Site. Step 4: .Outreach/Energy Centers: Ygrene will open an Outreach/Energy Center that will serve the program needs in the District for education, outreach, customer service, contractor liaison and information resources. Here, property owners can get their questions answered and obtain the necessary forms to apply for the program. District residents can learn how to save energy and money. Contractors can take classes to help them improve their service and increase their businesses. The Outreach/Energy Center will be designed, furnished and staffed by Ygrene to meet the specific needs of the PACE program in the District. Task 2.2: Website Development Ygrene will deliver a localized web portal for the District. The WebTool is designed to be localized, yet still provide national and statewide standardization necessary to ensure uniform legal and financial underwriting. The website components and services may include some of the following components: Video on PACE: A short, educational video on how PACE works Frequently Asked Questions (FAQ) Page (regularly updated) Assessment Calculator: A computerized tool that allows interested residents to input their desired project and determine both the annual assessment payments and the expected energy savings. By modeling different project components, property owners can determine an optimum retrofit and renewable energy profile for their property. Estimate: A computerized tool that allows interested property owners, by entering basic info' ation about their property, to determine the amount of financing they can qualify for under the program. Project Application: Everything necessary to apply for financing under the program. Qualifying Improvements: A description of the project components a property owner can select under the program. Program Forms: All program foiuis are available through the website. They can be completed electronically, or printed and filled out manually: Forms and personal assistance are also available at the Outreach/Energy Center. Authorized • Contractor Bid Request: This on-line tool provides real time information about contractor qualifications, the jobs they are supervising and resources for contacting them and soliciting bids. Project Evaluation: Property owners can report their program experiences with respect to project results, contractor performance, and Administrator performance. Ygrene also provides real-time data for District analysis of jobs, energy and greenhouse gas impacts from the program. Contact Information: Lists phone number(s) and email address(es) for all program personnel and for qualified contractors. Contractor Communication and Coordination: An online tool that allows contractors to monitor current projects and those in the pipeline. Contactor Information: An Outreach/Energy Center resource that provides quick access to specialty subcontractors, when needed; and updates contractors on new tools, training, equipment and developments in the field. "Documents:=Acomprehensive .document management system that allows password protected access --- 'to, all program and 'project documents, at any time, by both Ygrene personnel and authorized District representatives. 4 TASK 3: Contractor Certification and Training Based on State or other licensing requirements, Ygrene registers and authorizes all contractors. Ygrene provides and requires both direct and indirect training to ensure participants are professional, knowledgeable and qualified to undertake PACE projects. Ygrene will provide oversight, evaluations and conflict resolution. This software includes capabilities: • Enables all licensed building contractors to register and participate in the program. • Provides a platform where contractors are able to: - Manage the project submission and approval process - Track the progress of payments due under their contracts • Provides a set of standards to calculate the SIR through audit and bid tools. • Acquires historic energy usage for each property and quantifies energy use reductions once project improvements are completed. o Provides immediate access to a wide range of data and reports related to the operation, status and success of the overall program. participating that program In addition, the following TASK 4: Administration The PACE .administration function includes processing applications, providing customer service and administration, management of assessments and payments, recruitment, training and oversight of the contractors who perform approved energy efficiency, renewable energy and wind resistance work. Task 4.1: Property Owner Applications Ygrene will evaluate applications and process them on a first -come, first -served basis. Ygrene will use an electronic system that will track submitted applications, monitor the status of those applications and verify that assessments, once processed and approved, meet policy guidelines. Ygrene will also timely communicate pre -approval, approval, or denial notifications to applicants. Task 4.2: Qualifying Project and Authorized Contractor Selection Once an application has been submitted, the property owner will coordinate with their contractor of choice to select items from the Qualifying Improvements list that they are interested in installing. Since the District proran, requires compliance with the list of Qualifying Improvements, Y grene's software tools limit funded projects only to Qualifying Improvements authorized by the District. At all steps in the process, personal assistance is available to property owners, at the Outreach/Energy Center, on the phone or via email, to complete applications and select a contractor. Task 4.3: Energy Savings Calculations — Audit Contractors will be equipped with audit tools in order to establish that the Savings to Investment Ratio (SIR) of the proposed project is greater than one. Quantifiable energy reductions may, in some circumstances, result in eligibility for increased assessment allocations for projects. Task 4.4: Owner Bid Approval Following project submittal, Ygrene will monitor project status throughout the bid acceptance process. Once the property owner accepts a project bid, Ygrene prepares and submits the financing agreement. Task 4.5: Assessment Processing Onee'subnutted for funding approval and assessment documentation, the project status willbe updated electronically'and Ygrenewill authorize the property. owner and, the contractorto obtainpemuts and commence construction. 5 Task 4.6: UtiIity Rebate Processing As part of the processing, contractors can review each project and verify whether proposed measures may qualify for utility or other incentives. Ygrene will develop a "utility rebate" guide to assist property owners during the process of choosing qualified measures. If the PACE Assessment is for a measure that qualifies for an incentive/rebate, the applicant will be made aware of the options. Task 4.7: Final Approval Upon project. compl etion, contractors will be required to obtain a final inspecti on from the building department that issued the building permits. Following notification of receipt of the final inspection, and verification that all liens have been released, the Property owner will approve the project and submit for payment and recording of the financing assessment. Taslc 4.8: Record Notices of Assessment for Specific Properties Yarene will coordinate the timely recording of each financing agreement as required by the PACE Act. Task 4.9: Program Status and Reporting Ygrene's WEB tool allows on -demand status and program data updates to the District and other authorized persons on a real time basis. Available information includes: • Website Analytics • Number of calls to 800# Number of assessment applications requested Number of assessment applications filled out/turned in • Number of assessment applications processed • Number of assessment applications approved • Program funding levels and total fund status • Authorized Contractors and Certification Levels Final Inspections • Energy saved through completed projects • Greenhouse Gas reductions achieved through completed Estimated job creation impact of completed projects Task 4.10: Property Owner Services in the District Ygrene will provide dedicated customer service appropriate to property types (residential and/or commercial/industrial) : • Dedicated toll -free property owner infouuation line • Outreach/Energy Center open to public • Collateral materials • On-line WebTool to monitor projects and assist completion • Dedicated property owner service representatives fluent in English and Spanish; Reporting on owner satisfaction 6 TASK 5: Support Ygrene's provides ongoingcustomer service and support, even after projects are completed. Task 5.1: Website Development and Management Ygrene has developed an overall web architecture, WebTool and database and is dedicated to continuing to improve and expand its capability. Ygrene will provide all website maintenance, technical support and updates for ongoing PACE programs. Task 5.2: Ongoing Assessment Tracking and Management Through Willdan Financial Services, Ygrene will coordinate ongoing management and verification of assessments throughout the amortization term of the financing. Task 5.3: Provide Certification, Training and On -going Support for Contractors Ygrene will maintain an updated database of contractors and make training and education programs available within the District to ensure high quality, effective installation of improvements, to share best practices, and to provide a pathway for sidil upgrades. Task 5.4: District Staff and Property Owner Support Provide password protected, on-line access to real-time project data for properly authorized District staff. Provide in -person, telephone and email access to information regarding assessments and annual installments for property owners and program participants. Task 5.5: Status Meetings and Coordination Ygrene will participate in and/or attend appropriate District Board and advisory committee meetings and provide access to an administrative system that provides reports and status on the program's operations for each District participant. I.I. CREATION AND COLLECTION OF NON -AD VALOREM PACE ASSESSMENTS IN FLORIDA Ygrene sub -contractor, Willdan Financial Services ("Willdan"), in consultation with Counsel, will manage the legal and procedural considerations for placing PACE assessments on county property tax rolls. Highly experienced service providers to cities and counties in several states, Willdan and Counsel have the expertise and credentials to oversee this important PACE task on behalf of Ygr-ene and the District. III. PROGRAM TIMELINES Upon execution of the IPA agreement, Ygrene will provide a timeline for estimated completion of the Task List. Actual dates for commencement and completion will be based upon District and Counsel schedules and agreements among the Parties. IV. QUALIFYING IMPROVEMENTS The following list represents improvements that will be Qualifying Improvements"under the District 'PACE Program. -Additional and/or alternative measures may be approved on a case -by -case basis and/or as the listis modified fronitime to time in compliance with State Law or instructions frointhe District:" 7 1. Energy Efficiency a. Air Sealing and Ventilation • Air Filtration • Building Envelope • Duct Leakage and Sealing • Bathroom, ceiling, attic, and whole house fans b. Insulation • Defect Correction • Attic, floor, walls, roof, ducts c. Weather' Stripping d. Home Sealing e. Geothermal Exchange Heat Pumps f. HVAC Systems g. Evaporative Coolers • Cooler must have a separate ducting system from air conditioning and heating ducting system h. Natural gas storage water heater • Energy Star listed i. Tankless water heater j. Solar water heater system k, Reflective insulation or radiant barriers 1. Cool roof m. Windows and glass doors • U value of 0.40 or less and solar heat gain coefficient of 0.40 or less n. Window filming o. Skylights p. Solar tubes q. Additional building openings to provide addition natural light r. Lighting • Energy Star listed (no bulb, only retrofits) s. Pool equipment • Pool circulating pumps 2. Other Non - residential Building Measures The following measures are allowed for commercial and nonresidential buildings, in addition to all applicable energy efficiency measures listed above: a. Occupancy' Sensor Lighting Fixtures • SMART Parking Lot Bi ®Level Fixture • SMART Parlang Garage Bi•Level Fixtures SMART Pathway Lighting 8 • SMART Wall Pack Fixtures b. Task Ambient Office Lighting c. Classroom Lighting d. Refrigerator Case LED Lighting with Occupancy Sensors e. Wireless, daylight lighting controls f. Kitchen Exhaust Variable Air Volume Controls g. Wireless BIVAC Controls & Fault Detection 3. Solar Equipment District funding will be available for photovoltaic and solar thermal equipment. As with efficiency measures, if a rebate is available to the property owner, that amount must be deducted from the financing requested. Eligible solar equipment for both residential.and commercial properties includes: a. Solar thermal hot water systems b. Solar thermal systems for pool heating c. Photovoltaic systems (electricity) d. Emerging technologies — following the Custom Measures Track 4. Wind Resistance Measures Wind hardening measures can be deployed through this Program. The measures described qualify. a. Improving the strength of the roof deck and foundation attachment b. Creating a secondary water barrier to prevent water intrusion. c. Installing wind -resistant shingles or other roofing. d. Installing gable -end bracing. e. Reinforcing roof -to -wall connections. f. Installing storm shutters. g. Installing perimeter -opening protections. h. Raising building elevations. 5. Custom Measures The Custom Measures Track is a process by which [Program Name] staff can evaluate and approve funding for projects that are not "off the shelf' improvements listed in the Qualifying measures. These custom projects may involve large scale industrial or commercial energy efficiency improvements; processing or industrial mechanical systems; and renewable energy generation from sources such as geothermal and fuel cells. The following are examples of custom measures that will be considered for [Program Name] funding: b. Custom Energy Efficiency Measures a. Building energy management controls b. HVAC duct zoning control systems c. Irrigation pumps and controls d. Lighting controls e. Industrial and process equipment motors and controls 7. Custom Energy Generation Measures a. Fuel Cells b. Wind turbine power system c. Natural gas d. Hydrogen fuel e. Other fuel sources (emerging technologies) f. Co e generation (beat and energy) V. DISTRICT UNDERWRITING TERMS Following is a draft of the underwriting terms and disclosure for the District PACE program. In consultation with Counsel, Ygrene will develop the final foilu of this document that will be sighed by all participants as a requirement of the program. In order to apply for financing ("financing" or "funding") under the District PACE Program (the "Program") the property owner (the "Property Owner") must read and accept these District PACE Program Terms (the "Program Terms"). These Program Terms, along with the documents properly owners execute in connection with the Program, including but not limited to the Application, Assessment Agreement, Notice of Assessment. Project Contract, and Escrow Instructions - Project Approval described in "Funding" below (collectively the "Program Documents"), establish the terms of the District PACE Program. Property owners should become familiar with and understand the provisions of the Program Documents. By executing the Program Documents, the property owner agrees to all of the terms of the Program. The District reserves the right to amend these Program Terms from time to time as described in "Changes to the Program Terms; Severability" below. 1. Purpose of the Program The Program is intended to assist property owners in the District in financing the acquisition and installation of energy efficiency, wind resistance and renewable energy improvements (the "Qualifying Improvements"). With the assistance of Counsel, the District will authorize bonds to provide the source of financing for the Program. The bonds and the costs of administering the Program will be paid through special assessments added to the property tax bills paid by the property owners who choose to participate in the Program. There may be other types of financing available to property owners and the District does not guarantee that the Program is the best financing option. Property owners should obtain help in selecting the option that is most appropriate for their particular situation. 2. Summary of the Program Process As discussed in more detail below, in order to receive funding from the Program, property owners must complete the following steps for all property types: a. Determine that they meet the eligibility requirements. (see "Eligibility" below), b. Apply online or'submit a paper application for the Program. (see "Application; Approval or Denial; Application Fee" below). c. Agree -to these Program Terms and pay an application fee as part of the application process. 10 d. Notify any and all lenders holding a security lien of their intent to place a senior lien on the property and, in the case of multi -family residential property of ;more than four units and/or non-residential property, secure the lenders) agreement to do so. e. The Administrator must approve thecompleted application. (see "Application; Approval or Denial; Application Fee" below). f. A Certified Contractor must submit a bid for the installation of Qualifying Improvements on the property. (see "Qualifying Improvements; Certified Contractors; Maximum Funding" below). g. The District will record a Notice of Special Tax Lien against the property at the time of project approval. h. The District will authorize the release of funds to the property owner after project completion. Property owners may choose to assign payment directly to their contractor. (see "Funding Request" below). 1. Be expected to pay the special assessments in the amounts and at the times specified in the Funding Approval. (see "Financing Cost; Interest Rate; Special Assessments" below). The District has contracted with Ygrene Energy Fund to administer the program (the "Administrator"). The District will share information with the Administrator and other third parties as necessary to administer the Program. See "Disclosure of Property Owner Information" below. 3. EligibiIity The Program is available to all privately owned improved property. The financing terms and conditions set forth in these Program Terms are applicable to financings of S250,000.00 or less for retrofit projects in residential and non-residential properties (including multifamily properties of more than 4 units). The financing terms and conditions set forth in these Program Terris are not necessarily applicable to projects of more than S250,000.00. The District will establish the fmancing terms and conditions appropriate to larger projects at the time of financing approval. Low-income applicants are encouraged to apply and may qualify for assistance with the application fee or audit costs. In order to participate in the Program, a property' owner must meet and/or complete the following requirements and steps: a. The property to be improved with the Qualifying Improvements (the "subject property") must be located in the District. b. The subject property may be used for residential or non-residential purposes. If the subject property is used forresidentialpurposes, the property owner is not required to occupy the subject property as a primary residence. c. The property owner must provide written notice of the proposed senior lien to any and all lenders with existing liens on the subject property. Property owners of a non-residential property (including residential property of more than four units) must obtain the .written consent of existing lenders. The forms for these notifications (Lender Notification (Residential) and Lender Notification and Aclmowledgement) are available on-line or from the Administrator and must be submitted to the Administrator prior to project approval. d. All holders of fee simple title to the subject property must sign the Program Documents. Therefore, before submitting an Application, property owners must ensure that all property owners will agree to participate in the Program on the tents set forth in these Program Terms. e. Property owners will be required to participate in appropriate federal, state and District incentive programs, to the extent the subject property and/or the project are eligible for such programs at the time of application. f. The property owner must agree to provide the Administrator with access to the property's utility usage.history and information to enable the Program to monitor energy savings. The Utility Authorization Form is available on-line or from the Administrator for this purpose. Property owners'must be current in the payment of all obligations secured by the subject property, . including loans, property taxes, assessments and tax liens; and have maintained currency for all • 11 such obligations for the past 3 years (or since the current owner(s) took title to the subject property if less than 3 years). The Administrator may review public records and private credit histories, including County real property records, to verify compliance with this requirement. Certain allowances nlay be made for property tax payment delays that do not reflect financial distress. Cases of non-residential property owners who are currently appealing a property tax assessment will be reviewed and eligibility will be determined on a case -by -case basis. h. The value of the property, based on just value (or market value in cases where just value can be shown to uiueasonably underestimate the property value), must be equal to or greater than the sum of (i) the total debt, including mortgages and equity lines of credit, secured by the property, (ii) the principal amount of any Program indebtedness attributable to the property, and (iii) the aggregate principal amount of any fixed assessment liens on the property. i. The aggregate principal amount of the Program funding attributable to the property cannot exceed 20% of the value of the property (based on just value, appraised value, or market value calculated according to a method identified by the Administrator). j. It is critical to the health of the Program that property owners pay their special assessments and other property -related obligations in full on a timely basis. Consequently, the District reserves the right, in its sole discretion, to request supplemental information from owners and to deny applications based on any negative reports. 4. Initial Application; Approval or Denial; Application Fee. All property owners interested in applying to the Program must submit the Initial Application Documents listed below along with a S50 application fee (applications submitted on behalf of prperty owners by approved contractors, multi -family residential properties of more than four units and commercial/industrial projects are exempt from application fees). At the time of application, property owners must agree to the Program Terms. Project applications for larger financing amounts or building types not covered by these Programm Terms will receive an administrative point of contact from the Administrator, who will assist in the process. a. Initial Application Documents i. Application Form, either submitted online or printed and signed ii. Lender notification a For residential properties of 4 units or less, proof of mailing of the Residential Lender Notification fore. For residential properties with more than 4 units and for non-residential properties, properly executed Lender Notification and Acknowledgement form from existing lender(s). b. Upon receipt of the Application documents and underwriting, by the Administrator, applicants tvihl receive either a Notice of Approval or a Notice of Denial. c. Upon receipt of a Notice of Approval, applicants must obtain Residential Lender Notification forms or Lender Notification and Acknowledgement forms, available either on-line or from the Administrator, and submit them to their lender(s). Property owners will be required to provide to the Administrator with Proof of Mailing for Lender Notification and Acknowledgement foiuis. d. Upon receipt of a Notice of Approval, applicants can proceed to submit their proposed project for approval (See "Project Approval" below). e. Should an application be denied, the notice will include recommend remedial action that may be available to the applicant. -5. QuaIifying Improvements; Certified Contractors; Maximum Funding. The following general provisions apply to all projects submitted for funding under the Program: 'a. Program financing may only be used to finance those.improvernents that are described in the list of Qualifying improvements: Property owners are responsible to ensure that improvements 12 installed on their property qualify under the program. Contractor/installer agreements will be required to address performance and other system -related issues to assist property owners. b. The Program is a financing program only. Neither the District nor the Administrator is responsible for installation of the Qualifying Improvements or their performance. c. The Qualifying Improvements must be installed by contractors who meet the eligibility criteria set forth for the specific category of work being financed, and who are listed on the Certified Contractors list that may be obtained on-line or from the Administrator. If property owners choose to work with a contractor that is either not a Certified Contractor or who fails to become a Certified Contractor, they will not be eligible for Program financing. d. For a proposed project to qualify for funding, the Certified Contractor must submit evidence that the project fulfills the requirement of providing a savings -to -investment ratio (SIR) of at least one. This means that the energy cost savings attributable to the installation of the Qualifying Improvements must equal the funded cost of those improvements over their useful life. e. Maximum Funding. The Program requires a minimum funding request of S2,500. The Program will. approve maximum funding requests in an amount equal to the lesser of (i) maximum amount allowed under FL law for the property or (ii) the final cost of installing the Qualifying Improvements (including allowable fees) less any federal, state, District and Utility rebates, plus the additional items identified in "Financing Cost; Interest Rate" below. The funding limits are per property per financing request. The Program will not provide financing for any costs in excess of the maximum amounts allowed under FL law. Participants are invited to submit projects that may exceed the basic ratio of cost vs. fair value, based upon the savings -to - investment ratio achieved by the Qualifying Improvements. Such projects may require alternative legal and financial processing. 6. Project Approval. Upon receipt of a Notice of Approval of a Program application and following notification and/or request for lender aclanow ledgement (approval), the property owner may select a contractor and proceed to apply for project funding. Following are the steps required to obtain authorization for funding under the Program: a. Select a contractor from the Certified Contractor List. This list is available on-line and/or from the Administrator. Applicants may wish to obtain bids and advice from more than one Certified Contractor. b. Work with Certified Contractor(s) to determine the scope and cost of your project, analyze its energy and savings and financial benefits to confirm a SIR of at least one, and verify that the proposed work qualifies for funding under the Program. Once Qualifying Improvements are selected, obtain a formal bid from one or more Certified Contractors. c. Following review of the project bid(s) select a Certified Contractor to complete the approval process with. the Program Administrator. Even if the project requires using more than one Certified Contractor for various aspects of the work (i.e. — retrofit and solar), applicants must select a Iead contractor to process the project. d. Upon review of the proposed project and the bid(s) submitted for the work, the Administrator will issue either a Project Approval Letter or a Project Denial Letter. This communication will be provided by email unless directed otherwise by the applicant. e. Once the project is approved, applicants will be required to execute the Assessment Agreement. This is the contract that authorizes the Administrator and the District to place the assessment on the property that will secure the project financing. The assessment must be in place prior to commencement of construction. f. Once the assessment is recorded, applicants will receive a Notice to Proceed. Upon receipt of this notice, 'applicants -can sign construction contracts and authorize commencement of the project. If construction begins prior to receipt of a Notice to Proceed, applicants run the risk •of not qualifying for Program funding. .- 13 g. If the project is denied, the Project Denial Letter will outline remedial action that may be available to the applicant. 7. Funding a. Once the Certified Contractor has completed installation of the Qualifying Improvements, property owners must submit a funding request and the project verification documents listed below in order to receive funding from the Program. The Administrator will review the funding request and the project verification documents, and produce final Program forms. The final Program forms will be transmitted via email, or by mail if so directed by the property owner. All required forms must be returned to the Administrator prior to funding. The project verification documents and final Program fowls are listed below. i. A final sign -off on the building permit for the project from the authorized building official in the appropriate District participating jurisdiction. ii. Final invoices and lien releases from all Certified Contractors (including any sub- contractors) who worked on the project. iii. An executed Project Approval signed and notarized by all property owners. By executing the Project Approval, owners aline}: their property to the Special Tax District, agree to pay the special assessments in specified amounts for the period specified in the Project Approval, consent to recordation of a Notice of Special Tax Lien against the subject property, and release the Administrator and the District from any liability associated with installation of the Qualifying Improvements or their performance. iv. Utility Authorization to Release information. v. Assignment of Right to Receive Financing Proceeds form if the payment is to be assigned to someone other than the property owner. vi. Settlement Statement vii. Truth -in -Lending Disclosure Statement viii.FETA/FNMA FMAC Status Disclosure Form b. If the documents listed above are not submitted to the .Administrator within 7 calendar days after transmittal of the final Program forms, the funding request will expire. In that event, an updated funding request will be required. If the interest rate has changed between the date of the original funding request and any subsequent updated funding request, the interest rate will be reset (See "Financing Costs; Interest Rate below). c. Upon completion'of a final project audit, the Administratorwill make a final determination of eligibility of the project and calculation .of the final assessment details. Upon acceptance by the property owner, the Administrator and the District will amend the recorded tax lien as appropriate and approve issuance of checks as directed by the property owner d. In the event a property owner cancels financing after submitting a request for funding, all expenses incurred by the Program for recording tax liens, preparing bond documents and removing tax liens will be the responsibility of the property owner. S. Financing Costs; Interest Rate. a. In order to receive funding, property owners agree to pay special assessments in an amount equal to (i) the principal amount received from the Program, (ii) interest on the principal amount received from the Program and (iii) initial and on -going administrative expenses. The District expects to levy special assessments on the owner's property tax bill, although it may bill separately for the Program installments. • b. Principal. This is the total of all financed project costs. These may include costs associated with implementing the project such as permits, audit expenses, application fees and capitalizedinterest (see "Capitalized Interest" below). Interest Rate .The rate of interest charged on the amount funded will be fixed for the -full termpf the assessment. The rate will be determined on the date of submission of a valid funding request. 14 Property owners can monitor interest rates on the Program website or by contacting the Administrator. d. Capitalized Interest. Because of administrative delays involved in placing the special tax assessments on County tax rolls; the payments may not appear on property tax bills in the first year. In this case the first tax year's tax installment may be added to the assessment. This will be itemized on the Settlement Statement. 9. Repayment Terms; Special Assessments; Foreclosure Terms. a. Repayment Terms. Following recordation of the Notice of Assessment, the property owner will be obligated to pay the special assessments specified in the Project Approval and the Notice of Assessment. b. Special Assessments and Foreclosure. A property owner must pay the taxes associated with the agreed -upon special assessment regardless of personal financial circumstances, the condition of the property, or the performance of the Qualifying Improvements. Property owners should not apply for financing if they are not certain they can meet the assessment obligations. The failure to pay property taxes in full or in part will result in financial repercussions including penalties, interest and possibly foreclosure. If property owners use an escrow account to pay their property taxes, they must notify the escrow company of the special tax payments. In such cases, property owners will need to increase monthly payments to the escrow account by an amount equivalent to the annual special assessments, divided by 12 months. 10. CompIiance with Existing Mortgages. Recordation of the Notice of Assessment will establish a continuing Iien as security for the obligation to pay the special assessments. The lien securing the obligation to pay special assessments will be senior to all private Iiens, including existing mortgage(s). Many mortgage and loan documents limit the ability of a property owner to place senior liens upon property without the consent of the lender, or authorize the lender to obligate borrowers to prepay the senior obligation. Recently, the Federal Housing Finance Agency has issued policy guidelines that question the validity and assessment status of PACE assessments. Program participants should confirm with their lender(s) that participation in the Program does not adversely impact their rights with respect to any existing loan documents. For residential projects, the Program requires property owners to notify their lenders prior to a funding request, to provide the Administrator with a copy of the letter and proof of mailing and to certify that the lender has not objected to the property participating.in.the Proms ant. For non-residential projects and residential properties containing more than 4 -units, property owners must notify the lender and receive written consent for the priority assessment lien from the lender prior to submitting a funding request. The Administrator provides required forms for lender notification and consent, but ultimate responsibility for addressin_ issues with existing lenders remains with property owners. 11. Transfer or Resale of the Subject Property. If Program participants sell their property prior to the end of the agreed -upon special tax period; the new owner will assume the special tax obligation. Ownership of any Qualifying Trnprovements on the subject property will transfer to the new owner at the close of escrow. Qualifying Improvements financed through the Program may not be removed from the property. Program participants agree to make all legally required disclosures regarding the existence of the special tax lien on the property in connection with any sale. 12. Rebates and Taxes. Participation in this Program does not reduce rebates available through federal, state, utility sponsored •and .District rebate programs. • More information on available programs can be found on-line or through Certified Contractors and other vendors. Participants should. consult with their tax advisors with respect -to the state and federal tax benefits and consequences of participating in the Prob am. 15 Neither the District nor the Administrator is responsible for the tax considerations of participating in the Program. 13. Changes in State and Federal Law. The District's ability to continue to. finance the Program is subject to a variety of state and federal laws. If those laws or the judicial interpretation thereof changes after a property owner applies for the Program, but before the District fulfills the funding request, the District may be unable to fulfill the request. In such event, the District shall have no liability as a result of. any such change in law or judicial interpretation. 14. Changes in Program Terms; Severability. The District reserves the right to change the Program Tenns at any time without notice. However; no such change will affect a participant's obligation to pay special assessments as set forth in the Project Approval. Participation in the Program will be subject to the Program Terms in effect from time to time, VI. FINANCIAL MODEL 1. Barclay's Capital: Ygrene and Barclay's Capital ("Barclays") have agreed that Barclays will provide interim (warehouse) financing and long term (bond) financing for the District program. Ygrene will form an affiliated corporation ("Ygrene Funding") to provide credit administration and underwriting services for this funding agreement. Besides providing assessment funding that will respond to virtnally any level of demand; the Barclay's agreement finances the administrative, marketing, legal and other costs of operating PACE programs. Like other financing programs, PACE is subject to market forces and interest rate fluctuations that will require adjustments of rates and terms during operation of the Program to maintain viability. Operating Capital: Ygrene's initial target interest rate for property owners participating in the District program is 7.00% ("Program Interest Rate"). This is based on a current estimated cost of funds from Ygrene Funding of 6.50% ( the estimated "Funding Rate"). This example results in an,interest rate spread of one half of one percent (0.5%) to provide for the operating and administrative costs of the District program (`Operating Capital"). Ygrene uses the Operating Capital for program administration, marketing and program development, legal and bond counsel, District cost reimbursement, overhead and profit. The actual Funding Rate is calculated as the on -the -run U.S. Treasury 10-year bond rate plus 3.25%. If the Funding Rate increases, the Program Interest Rate will increase by a like amount to provide adequate Operating Capital. Ygrene will endeavor to keep the Program Interest Rate as low as possible. 3. Fee Schedule: = In addition to-4.he Operating Capital, Ygrene relies on Program fees to fund operations. This fee structure minimizes up -front costs for property owners. 16 Residential property fees: Fee Description Amount Collected Initial application: $ 50.00 with application Processing & Underwriting: $ 125.00 at disbursement Energy audit: S 50.00 at disbursement Jurisdiction cost recovery: $ 100.00 at disbursement Recording & Disbursement: S 95.00 at disbursement Insurance: TBD i'13D CommerciaUlndustrial property fees: Fee Description Amount Collected Initial application: Waived IVIA Processing & Underwriting: S 250.00 at disbursement Energy Audit: TBD at disbursement Jurisdiction cost recovery: $ 100.00 at disbursement Recording & Disbursement: $ 250.00 at disbursement Insurance: TBD TBD This fee schedule is subject to change and must be approved by the District prior to the Commencement Date. Fees for energy audits are paid directly to contractors, are included in the project cost, and on commercial/industrial properties will be priced on a case -by -case basis. Insurance fees and methods of collection are under review and must be approved by the District prior to the Commencement Date. Of the fees listed, only the residential application fee is collected directly from property owners. The fee is waived when a Certified Contractor submits the application on a property owner's behalf. The remaining fees are paid through the assessment funding. In the event either the District or its constituent members enacts fees or other charges that have the effect of increasing Administrator's costs for providing the Services, Administrator may increase the fee provided for in this schedule to offset the increased costs. 4. Contractor Training & Administration: Funding for program operations is enhanced by. a 3.0% Project Oversight fee charged to Certified Contractors to reimburse the Program for training, lead generation, marketing services, Energy Center meeting space and services, etc. 5. Carbon Credits/Offsets 17grene will aggregate and accumulate carbon credits that result from PACE projects financed through the Program. A possible future source of Program revenue could result from the development of a market for these credits. 17 VII. PROGRAM FORMS Following is a partial list of forms and documents that may be required for the establishment, operation, administration, financing and reporting for the District PACE Program. These forms are maintained through a document Management program that allows ongoing, password -protected access for authorized District representatives. Forms will be added, edited and deleted as necessary for the operation of the District prob am. Interlocal Agreement Task List Program Report PACE Frequently Asked Questions Schedule of Fees List of Qualifying Improvements Assessment Underwriting Terms Application & Documentation Checldist Application Form. Financing Agreement Truth in Lending Form FHFA/FNMAJFMAC PACE Status Disclosure Fonn Lender Notification (Residential) Lender Notification and Ackznowledgement (Commercial & Industrial) Project Bid & Contract Form Funding Request Checklist Utility Authorization Form Closing- Checklist Utility Authorization Form Closing Checklist Notice of Assessment Assessment Agreement FL Assessment Underwriting Tenns Underwriting Policy Project Submission Checklist Project Approval Letter Project Denial Letter Notice to Proceed Draw Request Foiui Lien Release Form Change Order Request Form Final Building Permit Checklist Assignment of Right to Receive Financing Proceeds Wire Request Form Escrow Instructions Appraisal Report Project Energy Savings Calculations & CO2e Reductions SIR Report Form _ 18 Statutes & Constitution : View Statutes : online sunshine 11u}.1.r/ VY V!' VS' . 1Gv.J L(1L1..13.LLJ, Jlu tu�v.�� ia,uv The 2011 Florida Statutes Select Year: 2011 Title XI COUNTY ORGANIZATION AND INTERGOVERNMENTAL RELATIONS Chapter 163 INTERGOVERNMENTAL PROGRAMS View Entire Chapter 163.01 Florida Interlocal Cooperation Act of 1969.— (1) This section shall be known and may be cited as the "Florida Interlocal Cooperation Act of 1969." (2) It is the-purpose.of this section to permit local governmental units to make the most efficient use of their powers by enabling them to cooperate with other localities on a basis of mutual advantage and thereby to provide services and facilities in a manner and pursuant to forms of governmental organization that will accord best with geographic, economic, population, and other factors influencing the needs and development of local communities. (3) As used in this section: (a) "Interlocal agreement" means an agreement entered into pursuant to this section. (b) "Public agency" means a political subdivision, agency, or officer of this state or of any state of the United States, including, but not limited to, state government, county, city, school district, single and multipurpose special district, single and multipurpose public authority, metropolitan or consolidated government, a separate legal entity or administrative entity created under subsection (7), an independently elected county officer, any agency of the United States Government, a federally recognized Native American tribe, and any similar entity of any other state of the United States. (c) "State" means a state of the United States. (d) "Electric project" means: 1. Any plant, works; system; facilities, and real property and personal property of any nature whatsoever, together with all parts thereof and appurtenances thereto, which is located within or without the state and which is used or useful in the generation, production, transmission, purchase, sale, exchange, or interchange of electric capacity and energy, including facilities and property for the acquisition, extraction, conversion, transportation, storage, reprocessing, or disposal of fuel and other materials of any kind for any such purposes. 2. Any interest in, or right to, the use, services, output, or capacity of any such plant, works, system, or facilities. 3. Any study to determine the feasibility or costs of any of the foregoing, including, but not limited to, engineering, legal, financial, and other services necessary or appropriate to determine the legality and financial and engineering feasibility of any project referred to in subparagraph 1. or subparagraph 2. (e) "Person" means: 1. Any natural person; 2. The'United States; any state; any municipality, political subdivision, or municipal corporation .or ursuant'to the laws of the United States or any state, or any board,. created b �, p corporation, or other . . entity or body declared by or pursuant to the taws of the United States or any state to be a department, agency, or instrumentality thereof; 1 of 19 12/16/2011 10: 07 AM statutes & Lonst1AIUon : view JCaiuieL, : Vill111G 1.1miu,ic 3. Any corporation, not -for -profit corporation, firm, partnership, cooperative association, electric cooperative, or business trust of any nature whatsoever which is organized and existing under the laws of the United States or any state; or 4. Any foreign country; any political subdivision or governmental unit of a foreign country; or any corporation, not -for -profit corporation, firm, partnership, cooperative association, electric cooperative, or business trust of any nature whatsoever which is organized and existing underthe laws of a foreign country or of a political subdivision or governmental unit thereof. (f) "Electric utility" has the same meaning as in s. 361.11(2). (g) "Foreign public utility" means any person whose principal location or principal place of business is not located within this state; who owns, maintains, or operates facilities for the generation, transmission, or distribution of electrical energy; and who supplies electricity to retail or wholesale customers, or both, on a continuous, reliable, and dependable basis. "Foreign public utility" also means any affiliate or subsidiary of such person, the business of which is limited to the generation or transmission; or both, of electrical energy and activities reasonably incidental thereto. (h) "Local government liability pool" means a reciprocal insurer as defined in s. 629.021 or any self-insurance program created pursuant to s. 768.28(16), formed and controlled by counties or municipalities of this state to provide liability insurance coverage for counties, municipalities, or other public agencies of this state, which pool may contract with other parties for the purpose of providing claims administration, processing, accounting, and other administrative facilities. (4) A public agency of this state may exercise jointly with any other public agency of the state, of any other state, or of the United States Government any power, privilege, or authority which such agencies share in common and which each might exercise separately. (5) A joint exercise of power pursuant to this section shall be made by contract in the form of an interlocal agreement, which may provide for: (a) The purpose of such interlocal agreement or the power to be exercised and the method by which the purpose will be accomplished or the manner in which the power will be exercised. (b) The duration of the interlocal agreement and the method by which it may be rescinded or terminated by any participating public agency prior to the stated date of termination. (c) The precise organization, composition, and nature of any separate legal or administrative entity created thereby with the powers designated thereto, if such entity may be legally created. (d) The manner in which the parties to an intertocal agreement will provide from their treasuries the financial support for the purpose set forth in the interlocal agreement; payments of public funds that may be made to defray the cost of such purpose; advances of public funds that may be made for the purposes set forth in the interlocal agreements and repayment thereof; and the personnel, equipment, or property of one or more of the parties to the agreement that may be used in lieu of other contributions or advances. (e) The manner in which funds may be paid to and disbursed by any separate legal or administrative entity created pursuant to the interlocal agreement. (f) A method or formula for equitably providing for and allocating and financing the capital and operating costs, including payments to reserve funds authorized by law and payments of principal and interest on obligations. The method or formula shall be established by the participating parties to the interlocal agreement on a ratio of full valuation of real property, on the basis of the amount of services rendered or to be rendered or benefits received or conferred or::to be received .or conferred, or on% any other equitable basis, including the levying of taxes or assessments to pay such costs on the entire area serviced by the parties to the interlocal agreement, subject to such limitations as may be contained in 2 of 19 12/16/2011 10:07 AIV Statutes � .. Lonsntutton :view statutes : unime awunine • the constitution and statutes of this state. (g) The manner of employing, engaging, compensating, transferring, or discharging necessary personnel, subject to the provisions of applicable civil service and merit systems. (h) The fixing and collecting•of charges, rates, rents, or fees, where appropriate, and the making and promulgation of necessary rules and regulations and their enforcement by or with the assistance of the participating parties to the interlocat agreement. (i) The manner in which purchases shall be made and contracts entered into. (j) The acquisition, ownership, custody, operation, maintenance, lease, or sale of real or personal property. (k) The disposition, diversion, or distribution of any property acquired through the execution of such interlocal agreement. (l) The manner in which, after the completion of the purpose of the interlocal agreement, any surplus money.shatt be returned in proportion to the contributions made by the participating parties. (m) The acceptance of gifts, grants, assistance funds, or bequests. (n) The making of claims for federal or state aid payable to the individual or several participants on account of the execution of the interlocal agreement. (o) The manner of responding for any liabilities that might be incurred through performance of the interlocal agreement and insuring against any such liability. (p) The adjudication of disputes or disagreements, the effects of failure of participating parties to pay their shares of the costs and expenses, and the rights of the other participants in such cases. (q) The manner in which strict accountability of all funds shall be provided for and the manner in which reports, including an annual independent audit, of all receipts and disbursements shall be prepared and presented to each participating party to the interlocat agreement. (r) Any other necessary and proper matters agreed upon by the participating public agencies. (6) An interlocal agreement may provide for one or more parties to the agreement to administer or execute the agreement. One or more parties to the agreement may agree to provide all or a part of the services set forth in the agreement in the manner provided in the agreement. The parties may provide for the mutual exchange of services without payment of any contribution other than such services. The parties may provide for the use or maintenance of facilities or equipment of another party on a cost -reimbursement basis. (7)(a) An interlocal agreement may provide for a separate legal or administrative entity to administer or execute the agreement, which may be a commission, board, or council constituted pursuant to the agreement. (b) A separate legal or administrative entity created by an interlocal agreement shall possess the common power specified in the agreement and may exercise it in the manner or according to the method provided in the agreement. The entity may, in addition to its other powers, be authorized in its own name to make and enter into contracts; to employ agencies or employees; to acquire, construct, manage, maintain, or operate buildings, works, or improvements; to acquire, hold, or dispose of property; and to incur debts, liabilities, or obligations which do not constitute the debts, liabilities, or obligations of any of the parties to the agreement. (c) No separate legal or administrative entity created by an...interlocal.agreement shall possess the, power or authority to levy ariy type of tax within the boundaries of any governmental unit participating in the interlocal agreement; to issue any type of bond in its own name,'oi in'any-way to obligate financially a governmental unit participating in the interlocal agreement. However, any separate legal entity, the 'Membership of which consists only of electric utilities as defined in s. 361.11(2) and which is created for 3of19 12/16/2011 10: 07 AM ltatutes d: l..ollsL1UA1u11 . VIGN1' JL4LULUJ . vluu c �uUJiuu� the purpose of exercising the powers granted by part II of chapter 361, the Joint Power Act, may, for the purpose of financing or refinancing the costs of an electric project, exercise all powers in connection with the authorization, issuance, and sale of bonds as are conferred by parts I, II, and III of chapter 159 or part II of chapter 166, or both. Any such entity may also issue bond anticipation notes, as provided by s. 215.43-1, in connection with the authorization, issuance, and sale of such bonds. All of the privileges, benefits, powers, and terms of parts I, II, and III of chapter-159 and part II of chapter 166, notwithstanding any limitations provided above, shall be fully applicable to such entity. In addition, the governing body of such legal entity may also authorize bonds to be issued and sold from time to time and delegate, to such officer, official, or agent of such legal entity as the governing body of such legal entity shall select, the power to determine the time; manner of sale, public or private; maturities; rate or rates of interest, which may be fixed or may vary at such time or times and in accordance with a specified formula or method of determination; and other terms and conditions as may be deemed appropriateby the officer, official, or agent so designated by the governing body of such legal entity. However, the amounts and maturities of -such bonds and the interest rate or.rates on such bonds shall be within the limits prescribed by the governing body of such legal entity in its resolution delegating to such officer, official, or agent the power to authorize the issuance and sale of such bonds. Bonds issued pursuant to this section may be validated as provided in chapter 75 and paragraph (15)(f). However, the complaint in any action to validate such bonds shall be filed only in the Circuit Court for Leon County. The notice required to be published by s. 75.06 shall be published only in Leon County, and the complaint and order of the circuit court shalt be served only on the State Attorney of the Second Judicial Circuit and on the state attorney of each circuit in which a public agency participating in the electric project ties. Notice of such proceedings shall be published in the manner and at the time required by s. 75.06 in Leon County and in each county in which any portion of any public agency participating in the electric project ties. (d) Notwithstanding the provisions of paragraph (c), any separate legal entity created pursuant to this section and controlled by the municipalities or counties of this state or by one or more municipality and one or more county of this state, the membership of which consists or is to consist of municipalities only, counties only, or one or more municipality and one or more county, may, for the purpose of financing or refinancing any capital projects, exercise all powers in connection with the authorization, issuance, and sale of bonds. Notwithstanding anylimitations provided in this section, all of the privileges, benefits, powers, and terms of part I of chapter 125, part II of chapter 166, and part I of chapter 159 shall be fully applicable to such entity. Bonds issued by such entity shall be deemed issued on behalf of the counties or municipalities which enter into loan agreements with such entity as provided in this paragraph. Any loan agreement executed pursuant to a program of such entity shall be governed by the provisions of part I of chapter 159 or, in the case of counties, part I of chapter 125, or in the case of municipalities and charter counties, part II of chapter 166. Proceeds of bonds issued by such entity may be loaned to counties or municipalities of this state or a combination of municipalities and counties, whether or not such counties or municipalities are also members of the entity issuing the bonds. The issuance of bonds by such entity to fund a loan program to make loans to municipalities or counties or a combination of municipalities and counties with one another for capital projects to be identified subsequent to the issuance of the bonds to fund such loan programs is deemed to be a paramount public purpose. Any entity so created may also -issue bond anticipation notes, as provided by s. 215.431, in connection with the authorization, issuance, -and sale of such bonds. In addition, the governing body of such legal entity may also authorize bonds to be issued and sold from `time to time and may -delegate, to such officer, official, or,agent of such legal entity.. :... • as -the governing body of such legal entity may select, the power to determine the time; manner of sale, public or private; maturities; rate or rates of interest, which may be fixed or may vary at such time or 4 of 19 12/16/2011 10:07 AM Jtamtes Q. L.on$ULU1IU1 . view JLQLU!Z, . V111111,- Jw1311l1, times and in accordance with a specified formula or method of determination; and other terms and conditions as may be deemed appropriate by the officer, official, or agent so designated by the governing body of such legal entity. However, the amounts and maturities of such bonds and the interest rate or rates of such bonds shall be within the limits prescribed by the governing body of such legal entity and its resolution delegating to such officer, official,. or agentthe power to authorize the issuance and sale of such bonds. A local government self-insurance fund established under this section may financialty guarantee bonds or bond anticipation notes issued or loans made under this subsection. Bonds issued pursuant to this paragraph may be validated as provided in chapter 75. The complaint in any action to validate such bonds shall be filed only in the Circuit Court for Leon County. The notice required to be published by s. 75.06 shall be published only in Leon County, and the complaint and order of the circuit court shall be served only on the State Attorney of the Second Judicial Circuit and on the state attorney of each circuit in each county where the public agencies which were initially a party to the agreement are located. Notice of such proceedings shall be published in the manner and the time required by s. 75.06 in Leon County and in each county where the public agencies which were initially a party to the agreement are located. Obligations of any county or municipatity pursuant to a loan agreement as described in this paragraph may be validated as provided in chapter 75. (e)1. Notwithstanding the provisions of paragraph (c), any separate legal entity, created pursuant to the provisions of this section and controlled by counties or municipalities of this state, the membership of which consists or is to consist only of public agencies of this state, may, for the purpose of financing the provision or acquisition of liability or property coverage contracts for or from one or more local government liability or property pools to provide liability or property coverage for counties, municipalities, or other public agencies of this state, exercise all powers in connection with the authorization, issuance, and sale of bonds. All of the privileges, benefits, powers, and terms of s. 125.01 relating to counties and s. 166.021 relating to municipalities shall be fully applicable to such entity and such entity shall be considered a unit of local government for all of the privileges, benefits, powers, and terms of part I of chapter 159. Bonds issued by such entity shall be deemed issued on behalf of counties, municipalities, or public agencies which enter into loan agreements with such entity as provided in this paragraph. Proceeds of bonds issued by such entity may be loaned to counties, municipalities, or other public agencies of this state, whether or not such counties, municipalities, or other public agencies are also members of the entity issuing the bonds, and such counties, municipalities, or other public agencies may in turn deposit such loan proceeds with a separate local government liability or property pool for purposes of providing or acquiring tiability or property coverage contracts. 2. Counties or municipalities of this state are authorized pursuant to this section, in addition to the authority provided by s. 125.01, part II of chapter 166, and other applicable taw, to issue bonds for the purpose of acquiring liability coverage contracts from a local government liability pool. Any individual county or municipality may, by entering into interlocat agreements with other counties, municipalities, or public agencies of this state, issue bonds on behalf of itself and other counties, municipalities, or other public agencies, for purposes of acquiring a liability coverage contract or contracts from a local government liability pool. Counties, municipalities, or other public agencies are also authorized to enter into loan agreements with any entity created pursuant to subparagraph 1., or with any county or municipality issuing bonds pursuant to this subparagraph, for thepurpose of obtaining bond proceeds with which to acquire liability coverage contracts from a local government liability pool. No county, municipality, or other public agency shall at any time have more';than one loan.. agreement outstanding for 'the purpose of obtaining bond proceeds with which to acquire liability coverage contracts from a local government liability 'pool. -Obligations of any county, municipality, or other public agency of.this state 5 of 19 12/16/2011 10: 07 AIv Jtatutes 6 l UllSulullvll . vlcw JLALutc . viuiir JULJuuA pursuant to a loan agreement as described above may be validated as provided in chapter 75. Prior to the issuance of any bonds pursuant to subparagraph 1. or this subparagraph for the purpose of acquiring liability coverage contracts from a local government liability pool, the reciprocal insurer or the manager of any self-insurance program shall demonstrate to the satisfaction of the Office of Insurance Regulation of the Financial Services Commission that excess liability coverage for counties, municipalities, or other public agencies is reasonably unobtainable in the amounts provided by such pool or that the liability coverage obtained through acquiring contracts from a local government liability pool, after taking into account costs of issuance of bonds and any other administrative fees, is less expensive to counties, municipalities, or special districts than similar commercial coverage then reasonably available. 3. Any entity created pursuant to this section or any county or municipality may also issue bond anticipation notes, as provided by s. 215.431, in connection with the authorization, issuance, and sale of such bonds. In addition, the governing body of such legal entity or the governing body of such county or municipality may also authorize bonds to be issued and sold from time to time and may delegate, to such officer, official, or agent of such legal entity as the governing body of such legal entity may select, the power to determine the time; manner of sale, public or private; maturities; rate or rates of interest, which may be fixed or may vary at such time or times and in accordance with a specified formula or method of determination; and other terms and conditions as may be deemed appropriate by the officer, official, or agent so designated by the governing body of such legal entity. However, the amounts and maturities of such bonds and the interest rate or rates of such bonds shall be within the limits prescribed by the governing body of such legal entity and its resolution delegating to such officer, official, or agent the power to authorize the issuance and sate of such bonds. Any series of bonds issued pursuant to this paragraph for liability coverage shall mature no later than 7 years following the date of issuance. A series of bonds issued pursuant to this paragraph for property coverage shall mature no later than 30 years following the date of issuance. 4. Bonds issued pursuant to subparagraph 1. may be validated as provided in chapter 75. The complaint in any action to validate such bonds shall be filed only in the Circuit Court for Leon County. The notice required to be published by s. 75.06 shall be published in Leon County and in each county which is an owner of the entity issuing the bonds, or in which a member of the entity is located, and the complaint - and order of the circuit court shall beserved only on the State Attorney of the Second Judicial Circuit and on the state attorney of each circuit in each county or municipality which is an owner of the entity issuing the bonds or in which a member of the entity is located. 5. Bonds issued pursuant to subparagraph 2. may be validated as provided in chapter 75. The complaint in any action to validate such bonds shall be filed in the circuit court of the county or municipality which wilt issue the bonds. The notice required to be published by s. 75.06 shall be published only in the county where the complaint is filed, and the complaint and order of the circuit court shall be served only on the state attorney of the circuit in the county or municipality which will issue the bonds. 6. The participation by any county, municipality, or other public agency of this state in a local government liability pool shall not be deemed a waiver of immunity to the extent of liability coverage, nor shall any contract entered regarding such a local government liability pool be required to contain any provision for waiver. - (f) Notwithstanding anything to the contrary, any separate .legal entity, created pursuant to the --provisions of this section, wholly owned by the municipabties or counties ofthis state, the membership of which consists or is to-ainist only of municipalities or counties of this state, may exercise the right -and power of eminent domain, including the procedural powers under chapters .73-and 74, if such right and power is granted to such entity by the intertocal agreement creating the entity. - 6 of 19 12/16/2011 10: 07 A1V salutes Q l oriSL1luuo11 : view )L4LULCS . v1u111c JtA1J1ll1R (g)1. Notwithstanding any other provisions of this section, any separate legal entity created under this , section, the membership of which is limited to municipalities and counties of the state, and which may include a special district in addition to a municipality or county or both, may acquire, own, construct, improve, operate, and manage public facilities, or finance facilities on behalf of any person, relating to a governmental function or purpose, including, but.not limited to, wastewater facilities, water or alternative water supply facilities, and water reuse facilities, which may serve populations within or outside of the members of the entity. Notwithstanding s. 367.171(7), any separate legal entity created under this paragraph is not subject to Public Service Commission jurisdiction. The separate legal entity may not provide utility services within the service area of an existing utility system unless it has received the consent of the utility. 2. For purposes of this paragraph, the term: a. "Host government" means the governing body of the county, if the Largest number of equivalent residential connections currently served by a system of the utility is located in the unincorporated area, or the governing body of a municipality, if.the largest number of equivalent residential connections currently served by a system of the utility is located within that municipality's boundaries. b. "Separate legal entity" means any entity created by interlocat agreement the membership of which is limited to two or more special districts, municipalities, or counties of the state, but which entity is legally separate and apart from•any of its member governments. c. "System" means a water or wastewater facility or group of such facilities owned by one entity or affiliate entities. d. "Utility" means a water or wastewater utility and includes every person, separate legal entity, lessee, trustee, or receiver owning, operating, managing, or controlling a system, or proposing construction of a system, who is providing, or proposes to provide, water or wastewater service to the public for compensation. 3. A separate legal entity that seeks to acquire any utility shalt notify the host government in writing by certified mail about the contemplated acquisition not less than 30 days before any proposed transfer of ownership, use, or possession of any utility assets by such separate Legal entity. The potential acquisition notice shall be provided to the legislative head of the governing body of the host government and to its chief administrative officer and shall provide the name and address of a contact person for the separate Legal entity and information identified in s. 367.071(4)(a) concerning the contemplated acquisition. 4.a. Within 30 days following receipt of the notice, the host government may adopt a resolution to become a member of the separate legal entity, adopt a resolution to approve the utility acquisition, or adopt a resolution to prohibit the utility acquisition by the separate legal entity if the host government determines that the proposed acquisition is not in the public interest. A resolution adopted by the host government which prohibits the acquisition may include conditions that would make the proposal acceptable to the host government. b. If a host government adopts a membership resolution, the separate legal entity shall accept the host government as a member on the same basis as its existing members before any transfer of ownership, use, or possession of the utility or the utility facilities. If a host government adopts a resolution to approve the utility acquisition, the separate legal entity may complete the acquisition. If a host government adopts a prohibition resolution, the separate legal entity may not acquire the utility within that host government's territory without -the specific consent of the host government by future resolution. If a host government does not adopt -a -prohibition resolution or an approval resolution, the separate legal entity'may proceed to acquire the utility after the 30-day notice period without further notice. 5. After the acquisition or construction of any utility systems by a separate legal entity created under. 7of19 12/16/2011 10:07 AM Statutes &. Constitution :view atatutes : this paragraph, revenues or any other income may not be transferred or paid to a member of a separate legal entity, or to any other special district, county, or municipality, from user fees or other charges or revenues generated from customers that are not physically located within the jurisdictional or service delivery boundaries of the member, special district, county, or municipality receiving the transfer or payment. Any transfer or paymentto a member, special district,.or_other local government must be solely from user fees or other charges or revenues generated from customers that are physically located within the jurisdictional or service delivery boundaries of the member, special district, or local government receiving the transfer of payment. 6. This section is an alternative provision otherwise provided by law as authorized in s. 4, Art. VIII of the State Constitution for any transfer of power as a result of an acquisition of a utility by a separate legal entity from a municipality, county, or special district. 7. The entity may finance or refinance the acquisition, construction, expansion, and improvement of such facilities relating to a governmental function or purpose through the issuance of its bonds, notes, or other obligations under this section or as otherwise authorized by law. The entity has all the powers provided by the intertocal agreement under which it is created or which are necessary to finance, own, operate, or manage the public facility, including, without limitation, the power to establish rates, charges, and fees for products or services provided by it, the power to levy special assessments, the power to sell or finance all or a portion of such facility, and the power to contract with a public or private entity to manage and operate such facilities or to provide or receive facilities, services, or products. Except as may be limited by the intertocal agreement under which the entity is created, all of the privileges, benefits, powers, and terms of s. 125.01, relating to counties, and s. 166.021, relating to municipalities, are fully applicable to the entity. However, neither the entity nor any of its members on behalf of the entity may exercise the power of eminent domain over the facilities or property of any existing water or wastewater plant utility system, nor may the entity acquire title to any water or wastewater plant utility facilities, other facilities, or property which was acquired by the use of eminent domain after the effective date of this act. Bonds, notes, and other obligations issued by the entity are issued on behalf of the public agencies that are members of the entity. 8. Any entity created under this section may also issue bond anticipation notes in connection with the authorization, issuance,.and sate of.bonds. The bonds may be issued as serial bonds or as term bonds or both. Any entity may issue capital appreciation bonds or variable rate bonds. Any bonds, notes, or other obligations must be authorized by resolution of the governing body of the entity and bear the date or dates; mature at the time or times, not exceeding 40 years from their respective dates; bear interest at the rate or rates; be payable at the time or times; be in the denomination; be in the form; carry the registration privileges; be executed in the manner; be payable from the sources and in the medium or payment and at the place; and be subject to the terms of redemption, including redemption prior to maturity, as the resolution may provide. If any officer whose signature, or a facsimile of whose signature, appears on any bonds, notes, or other obligations ceases to be an officer before the delivery of the bonds, notes, or other obligations, the signature or facsimile is valid and sufficient for all purposes as if he or she had remained in office until the delivery. The bonds, notes, or other obligations may be sold at public or private sale for such price as the governing body of the entity shall determine. Pending preparation of the definitive bonds, the entity may issue interim certificates, which shall be exchanged for the definitive bonds. The bonds maybe secured by a form of credit enhancement, if any, as the entity deems appropriate. The bonds may be secured by an indenture of trust or trustagreement.,In addition, the governing bodyof the legal entity may delegate, to an officer, official, or agent=of the legal entity as the — governing body of the legal entity may select, the power to determine the time; manner of sale, public or 8 of 19 12/16/2011 10:07 AN Jtatutes d uonsU UL O❑ : view JtaLutes . viuuic pwiwuiic r.,, "`o private; maturities; rate of interest, which may be fixed or may vary at the time and in accordance with a specified formula or method of determination; and other terms and conditions as may be deemed appropriate by the officer, official, or agent so designated by the governing body of the legal entity. However, the amount and maturity of the bonds, notes, or other obligations and the interest rate of the bonds, notes, or other•obligations must be within the limits prescribed by the governing body of the legal entity and its resolution delegating to an officer, official, or agent the power to authorize the issuance and sate of the bonds, notes, or other obligations. 9. Bonds, notes, or other obligations issued under this paragraph may be validated as provided in chapter 75. The complaint in any action to validate the bonds, notes, or other obligations must be filed only in the Circuit Court for Leon County. The notice required to be published by s. 75.06 must be published in Leon County and in each county that is a member of the entity issuing the bonds, notes, or other obligations, or in which a member of the entity is located, and the complaint and order of the circuit court must be served only on the State Attorney of the Second Judicial Circuit and on the state attorney of each circuit in each county -that is a member of the entity issuing the bonds, notes, or other obligations or in which a member of the entity is located. Section 75.04(2) does not apply to a complaint for validation brought by the legal entity. 10. The accomplishment of the authorized purposes of a legal entity created under this paragraph is in all respects for the benefit of the people of the state, for the increase of their commerce and prosperity, and for the improvement of their health and living conditions. Since the legal entity will perform essential governmental functions in accomplishing its purposes, the legal entity is not required to pay any taxes or assessments of any kind whatsoever upon any property acquired or used by it for such purposes or upon any revenues at any time received by it. The bonds, notes, and other obligations of an entity, their transfer, and the income therefrom, including any profits made on the sale thereof, are at all times free from taxation of any kind by the state or by any political subdivision or other agency or instrumentality thereof. The exemption granted in this subparagraph is not applicable to any tax imposed by chapter 220 on interest, income, or profits on debt obligations owned by corporations. (h)1. Notwithstanding the provisions of paragraph (c), any separate Legal entity consisting of an alliance, as defined in s. 395.106(2)(a), created pursuant to this paragraph and controlled by and whose members consist of eligible entities comprised of special districts created pursuant to a special act and having the authority to own or operate one or more hospitals licensed in this state or hospitals licensed in this state that are owned, operated, or funded by a county or municipality, for the purpose of providing property insurance coverage as defined in s. 395.106(2)(b), for such eligible entities, may exercise all powers under this subsection in connection with borrowing funds for such purposes, including, without limitation, the authorization, issuance, and sale of bonds, notes, or other obligations of indebtedness. Borrowed funds, including, but not limited to, bonds issued by such alliance shall be deemed issued on behalf of such eligible entities that enter into loan agreements with such separate legal entity as provided in this paragraph. 2. Any such separate legal entity shall have all the powers that are provided by the interlocal agreement under which the entity is created or that are necessary to finance, operate, or manage the altiance's property insurance coverage program. Proceeds of bonds, notes, or other obligations issued by such an entity may be loaned to any one or more eligible entities. Such eligible entities are authorized to 'enter into loan agreements with any separate legal entity created pursuant to this paragraph for the purpose of obtaining moneys with which to finance property insurance coverage or claims Obligations of any eligible entity pursuant to a loan agreement as described in this paragraph may be validated as "` provided in chapter 75. 9 of 19 12/16/2011 10:07 AIV. JtatUteS Q. LOIISUJ1ULIUU : V1GVV JLCILULOJ . 11111111C JLLL1J111111. 3. Any bonds, notes, or other obligations to be issued or incurred by a separate legal entity created pursuant to this paragraph shall be authorized by resolution of the governing body of such entity and bear the date or dates; mature at the time or times, not exceeding 30 years from their respective dates; bear interest at the rate or rates, which may be fixed or vary at such time or times and in accordance with a specified formula or method ofrdetermination; be payable at the time or times; be in the denomination; be in the form; carry the registration privileges; be executed in the manner; be payable from the sources and in the medium of payment and at the place; and be subject to redemption, including redemption prior to maturity, as the resolution may provide. The bonds, notes, or other obligations may be sold at public or private sale for such price as the governing body of the separate legal entity shall determine. The bonds may be secured by such credit enhancement, if any, as the governing body of the separate legal entity deems appropriate. The bonds may be secured by an indenture of trust or trust agreement. In addition, the governing body of the separate legal entity may delegate, to such officer or official of such entity as the governing body may select, the power to determine the time; manner of sale, public or private; maturities; rate or rates of interest, which may be fixed or may vary at such time or times and in accordance with a specified formula or method of determination; and other terms and conditions as may be deemed appropriate by the officer or official so designated by the governing body of such separate legal entity. However, the amounts and maturities of such bonds, the interest rate or rates, and the purchase price of such bonds shall be within the limits prescribed by the governing body of such separate legal entity in its resolution delegating to such officer or official the power to authorize the issuance and sale of such bonds. 4. Bonds issued pursuant to this paragraph may be validated as provided in chapter 75. The complaint in any action to validate such bonds shall be filed only in the Circuit Court for Leon County. The notice required to be published by s. 75.06 shall be published in Leon County and in each county in which an eligible entity that is a member of an alliance is located. The complaint and order of the circuit court shall be served only on the State Attorney of the Second Judicial Circuit and on the state attorney of each circuit in each county in which an eligible entity receiving bond proceeds is located. 5. The accomplishment of the authorized purposes of a separate legal entity created under this paragraph is deemed in all respects for the benefit, increase of the commerce and prosperity, and improvement of the. health and living conditions ofthe people of this state. Inasmuch as the separate legal entity performs essential public functions in accomplishing its purposes, the separate legal entity is not required to pay any taxes or assessments of any kind upon any property acquired or used by the entity for such purposes or upon any revenues at any time received by the entity. The bonds, notes, and other obligations of such separate legal entity, the transfer of and income from such bonds, notes, and other obligations, including any profits made on the sale of such bonds, notes, and other obligations, are at all times free from taxation of any kind of the state or by any political subdivision or other agency or instrumentality of the state. The exemption granted in this paragraph does not apply to any tax imposed by chapter 220 on interest, income, or profits on debt obligations owned by corporations. 6. The participation by any eligible entity in an alliance or a separate legal entity created pursuant to this paragraph may not be deemed a waiver of immunity to the extent of liability or any other coverage, and a contract entered regarding such alliance is not required to contain any provision for waiver. (8) If the purpose set forth in an interlocal agreement is the:acquisition, construction, or operation of a revenue -producing facility, the agreement may provide for the repayment or return to the parties of all -or any part of •the .contributions', payments, or advances made by the parties pursuant to subsection (5) and for payment to the parties of any sum derived from the revenues of such facility `Payments, -- -. repayrnents, or returns shall be made at any time and in the manner specified in the agreement and may 10 of 19 12/16/2011 10:07 ATV Jtatlttes a. uonstitutiof : view �t�!uWS : viuI1ic Jw1S1II]1c be made at any time on or prior to the rescission or termination of the agreement or completion of the purposes of the agreement. (9)(a) All of the privileges and immunities from liability; exemptions from taws, ordinances, and rules; and pensions and relief, disability, workers' compensation, and other benefits which apply to the activity of officers, agents, or employees of any public agents or employees of any public agency when performing their respective functions within the territorial limits for their respective agencies shall apply to the same degree and extent to the performance of such functions and duties of such officers, agents, or employees extraterritorialty.under the provisions of any such interlocal agreement. (b) An interlocal agreement does not relieve a public agency of any obligation or responsibility imposed upon it by taw except to the extent of actual and timely performance thereof by one or more of the parties to the agreement or any legal or administrative entity created by the agreement, in which case the performance may be offered in satisfaction of the obligation or responsibility. (c) All of the privileges and immunities from liability and exemptions from laws, ordinances, and rules which apply to the municipalities and counties of this state apply to the same degree and extent to any separate legal entity, created pursuant to the provisions of this section, wholly owned by the municipalities or counties of this state, the membership of which consists or is to consist only of municipalities or counties of this state, unless the interlocal agreement creating such entity provides to the contrary. Alt of the privileges and immunities from liability; exemptions from taws, ordinances, and rules; and pension and relief, disability, and worker's compensation, and other benefits which apply to the activity of officers, agents, employees, or employees of agents of counties and municipalities of; this state which are parties to an interlocal'agreement creating a separate legal entity pursuant to the provisions of this section shall apply to the same degree and extent to the officers, agents, or employees of such entity unless the interlocal agreement creating such entity provides to the contrary. (10)(a) A public agency entering into an interlocal agreement may appropriate funds and sell, give, or otherwise supply any party designated to operate the joint or cooperative undertaking such personnel, services, facilities, property, franchises, or funds thereof as may be within its legal power to furnish. (b) A public agency entering into an interlocal agreement may receive grants-in-aid or other assistance funds from the United States Government or this state for use in carrying out the purposes of the interlocal agreement. (11) Prior to its effectiveness, an interlocal agreement and subsequent amendments thereto shalt be filed with the clerk of the circuit court of each county where a party to the agreement is located. However, if the parties to the agreement are located in multiple counties and the agreement under subsection (7) provides for a separate legal entity or administrative entity to administer the agreement, the interlocal agreement and any amendments thereto may be filed with the clerk of the circuit court in the county where the legal or administrative entity maintains its principal place of business. (12) Any public agency entering into an agreement pursuant to this section may appropriate funds and may sell, lease, give, or otherwise supply the administrative joint board or other legal or administrative entity created to operate the joint or cooperative undertaking by providing such personnel or services therefor as may be within its legal power to furnish. (13) The powers and authority granted by this section shall be in addition and supplemental to those granted by any other general, local, or special law. Nothing contained herein shall be deemed to interfere_ with the application of any other law. (14) This section is'intended to authorize the entry into contracts for the performance of service functions -of public agencies, but shall not be deemed to authorize the delegation of the contiutional'oi statutory duties of state, county, or city officers. ._ 11 of 19 12/16/2011 10: 07 AM Statutes & (onstitunon :view aiawies : vuuue �wis,iu,c (15) Notwithstanding any other provision of this section or of any other taw except s. 361.14, any public agency of this state which is an electric utility, or any separate legal entity created pursuant to the provisions of this section, the membership of which consists only of electric utilities, and which exercises or proposes to exercise the powers granted by part II of chapter 361, the Joint Power Act, may exercise any 'or all of the following powers: (a) Any such public agency or legal entity, or both, may plan, finance, acquire, construct, reconstruct, own, lease, operate, maintain, repair, improve, extend, or otherwise participate jointly in one or more electric projects, which are proposed, existing, or under construction and which are located or to be located within or without this state, with any one or more of the following: 1. Any such legal entity; 2. One or more electric utilities; 3. One or more foreign public utilities; or 4. Any other person, if the right to full possession and to all of the use, services, output, and capacity of any such electric project during the original estimated useful life thereof is vested, subject to creditors' rights, in any one or more of such legal entities, electric utilities, or foreign public utilities, or in any combination thereof. Any such public agency or legal entity, or both, may act as agent or designate one or more persons, whether or not participating in an electric project, to act as its agent in connection with the planning, design, engineering, licensing, acquisition, construction, completion, management, control, operation, maintenance, repair, renewal, addition, replacement, improvement, modification, insuring, decommissioning, cleanup, retirement, or disposal, or all of the foregoing, of such, electric project or electric projects. (b)1. In any case in which any such public agency or legal entity, or both, participate in an electric project with any one or more of the following: a. Any such legal entity; b. One or more electric utilities; c. One or more foreign public utilities; or d. Any other person, and if the right to full possession and to all of the use, services, output, and capacity of any such electric project during the original estimated useful life thereof is vested, subject to creditors' rights, in any one or more of such legal entities, electric utilities, or foreign public utilities, or in any combination thereof, such public agency or legal entity, or both, may enter into an agreement or agreements with respect to such electric project with the other person or persons participating therein, and such legal entity may enter into an agreement or agreements with one or more public agencies who are parties to the intertocal agreement creating such legal entity. Any such agreement may be for such period, including, but not limited to, an unspecified period, and may contain such other terms, conditions, and provisions, consistent with the provisions of this section, as the parties thereto shall determine. In connection with entry into and performance pursuant to any such agreement, with the selection of any person or persons with which any such public agency or legal entity, or both, may enter into any such agreement, and with the selection of any electric project to which such agreement may relate, no such public agency or Legal entity •shall be required to comply with any general, local, or..specia_ l.statute,__including, but not limitedto, the ;provisions 'of s: 287:055, or with any charter provision of -any public agency, •which would otherwise require public bidding, competitive negotiation, or both. 2. Any such agreement may include, but need not be limited to, any or all of the following: 12 of 19 12/16/2011 10:07 A1v Statutes 'Si:Constitution : View Statutes : ,viume sunsnme a. Provisions defining what constitutes a default thereunder and providing for the rights and remedies of the parties thereto upon the occurrence of such a default, including, without limitation, the right to discontinue the delivery of products or services to a defaulting party and requirements that the remaining parties_not.in..default.who_are entitled to receive products or services from the same electric project may be required to pay for and use or otherwise dispose of, .on a proportionate or other basis, all or some portion of the products and services which were to be purchased by the defaulting party. b. Provisions granting one or more of the parties the option to purchase the interest or interests of one or more other parties in the electric project upon such occurrences, and at such times and pursuant to such terms and conditions, as the parties may agree, notwithstanding the limitations on options in the provisions of any taw to the contrary. c. Provisions setting forth restraints on alienation of the interests of the parties in the electric project. d. Provisions for the planning, design, engineering, licensing, acquisition, construction, completion, management, control, operation, maintenance, repair, -renewal, addition, replacement, improvement, modification, insuring, decommissioning, cleanup, retirement, or disposal, or all of the foregoing of such electric project by any one or more of the parties to such agreement, which party or parties may be designated in or pursuant to such agreement as agent or agents on behalf of itself and one or more of the other parties thereto or by such other means as may be determined by the parties thereto. e. Provisions for a method or methods of determining and allocating among or between the parties the costs of planning, design, engineering, licensing, acquisition, construction, completion, management, control, operation, maintenance, repair, renewal, addition, replacement, improvement, modification, insuring, decommissioning, cleanup, retirement, or disposal, or all of the foregoing with respect to such electric project. f. Provisions that any such public agency or legal entity, or both, will not rescind, terminate, or amend any contract or agreement relating to such electric project without the consent of one or more persons with which such public agency or legal entity, or both, have entered into an agreement pursuant to this section or without the consent of one or more persons with whom any such public agency or legal entity, or both, have made a covenant or who are third -party beneficiaries of any such covenant. g. Provisions whereby any such public agency or legal entity, or both, are obligated to pay for the products and services of such electric project and the support of such electric project, including, without limitation, those activities set forth in sub -subparagraph d., without setoff or counterclaim and irrespective of whether such products or services are furnished, made available, or delivered to such public agency or legal entity, or both, or whether any electric project contemplated by such contract or agreement is completed, operable, or operating, and notwithstanding suspension, interruption, interference, reduction, or curtailment of the products and services of such electric project and notwithstanding the quality, or failure, of performance of any one or more of the activities set forth in sub -subparagraph d. with respect to such electric project. h. Provisions that in the event of the failure or refusal of any such public agency or legal entity, or both, to perform punctually any specified covenant or obligation contained in or undertaken pursuant to any such agreement, any one or more parties to such agreement or any one or more persons who have been designated in such agreement as third -party beneficiaries of such covenantor obligation may ,.. enforce the performance'of such public agency or legal entity by an action at taw or in equity, including, but not limited to, specific performance or mandamus. i. Provisions obligating any such public agency or legal entity, or both, to indemnify, including, without limitation, indemnification against the imposition or collection of local, state, or federal taxes 13 of19 12/16/2011 10:07 AM Statutes .7, Constitution : View' •Statutes : Unlme �unsmne ILI}J.// W h• N.1l:v.JL(1Ll..lt.aui Jlu �u��.Ji aaa and interest or penalties related thereto, or payments made in lieu thereof, to hold harmless, or to waive claims or rights for recovery, including claims or rights for recovery based on sole negligence, gross negligence, any other type of negligence, or any other act or omission, intentional or otherwise, against one ormore of the other parties to such agreement. Such provisions may define the class or classes of persons for whose acts,-intentional•or•otherwise, a party shall•not be responsible; and all of such provisions may be upon such terms and conditions as the parties thereto shall determine. j. Provisions obligating any such public agency or legal entity, or both, not to dissolve until alt. principal and interest payments for all bonds and other evidences of indebtedness issued by such public. agency or legal entity, or both, have been paid or otherwise provided for and until all contractual obligations and duties of such public agency or legal entity have been fully performed or discharged, or both. k. Provisions obligating any such public agency or legal entity, or both, to establish, levy, and collect rents, rates, and other charges for the products and services provided by such legal entity or provided by the electric or other integrated utility system of -such public agency, which rents, rates, and other charges shall be at least sufficient to meet the operation and maintenance expenses of such electric or integrated utility system; to comply with all covenants pertaining thereto contained in, and all other provisions of, any resolution, trust indenture, or other security agreement relating to any bonds or other evidences of indebtedness issued or to be issued by any such public agency or legal entity; to generate funds sufficient to fulfill the terms of all other contracts and agreements made by such public agency or legal entity, or both; and to pay all other amounts payable from or constituting a lien or charge on the revenues derived from the products and services of such legal entity or constituting a lien or charge on the revenues of the electric or other integrated utility system of such public agency. 1. Provisions obligating such legal entity to enforce the covenants and obligations of each such public agency with which such legal entity has entered into a contract or agreement with respect to such electric project. m. Provisions obligating such legal entity not to permit any such public agency to withdraw from such legal entity until all contractual obligations and duties of such legal entity and of each such public agency with which it has entered into a contract or agreement with respect to such electric project have been fully performed, discharged, or both. n. Provisions obligating each such public agency which has entered into a contract or agreement with such legal entity with respect to an electric project not to withdraw from, or cause or participate in the dissolution of, such legal entity until all duties and obligations of such legal entity and of each such public agency arising from all contracts and agreements entered into by such public agency or legal entity, or both, have been fully performed, discharged, or both. o. Provisions obligating each such public agency which has entered into a contract or agreement with such legal entity or which has entered into a contract or agreement with any other person or persons with respect to such electric project to maintain its electric or other integrated utility system in good repair and operating condition until all duties and obligations of each such public agency and of each such legal entity arising out of all contracts and agreements with respect to such electric project entered into by each such public agency or legal entity, or both, have been fully performed, discharged, or both. 3. All actions taken by an agent designated in accordance with the provisions of any such agreement may, if so provided in the agreement, be made binding upon such public agency or legal entity, or both, without further action or approval by such public agency or legal entity, or both. Any agent or._agents designated in any such agreement shall be governed by the taws and rules applicable to such agent as a separate entity and not by any laws or rules which may be applicable to any of the other participating 14 of 19 12/16/2011 10:07 AM Statutes & Constitution : view tamtes : onune swiswliir llLLmi./ / VY VP V1 s.u..uw.n u.u....... �.... parties and not otherwise applicable to the agent. (c) Any such legal entity may acquire services, output, capacity, energy, or any combination thereof only from: 1. An electric project in which it has an ownership interest; or 2. Any other source: a. To the extent of replacing the services, output, capacity, energy, or combination thereof of its share of an electric project when the output or capacity of such electric project is reduced or unavailable; or b. At any time and in any amount for resale to any of its members as necessary to meet their retail load requirements. However, under sub -subparagraph 2.b., such legal entity may not purchase wholesale power for resale to any of its members from any electric utility as a result of any legal proceeding commenced by the legal entity or any of its members after January 1, 1982, before any state or federal court or administrative body, to the extent that such purchase or proceeding would involuntarily expand the responsibility of the electric utility to provide such wholesale power. (d) Any such legal entity may sell services, output, capacity, energy, or any combination thereof only to: 1. Its members to meet their retail load requirements; 2. Other electric utilities or foreign public utilities which have ownership interests in, or contractual arrangements which impose on such electric utilities or foreign public utilities obligations which are the economic equivalents of ownership interests in, the electric project from which such services, output, capacity, energy, or combination thereof is to be acquired; 3. Any other electric utility or foreign public utility to dispose of services, output, capacity, energy, or any combination thereof that is surplus to the requirements of such legal entity: a. If such surplus results from default by one or more of the members of such legal entity under a contract or contracts for the purchase of such services, output, capacity, energy, or combination thereof; and b. If the revenues from such contract or contracts are pledged as security for payment of bonds or other evidences of indebtedness issued by such legal entity or if such revenues are required by such legal entity to meet its obligations under any contract or agreement entered into by such legal entity pursuant to paragraph (b); 4. Any other electric utility or foreign public utility for a period not to exceed 5 years from the later to occur of the date of commercial operation of, or the date of acquisition by such legal entity of any ownership interest in or right to acquire services, output, capacity, energy, or any combination thereof from, the electric project from which such services, output, capacity, energy, or combination thereof is to be acquired, if: a. One or more members of such legal entity have contracted to purchase such services, output, capacity, energy, or combination thereof from such legal entity commencing upon the expiration of such period; and b. Such services, output, capacity, energy, or combination thereof, if acquired commencing at an earlier time, could have been reasonably predicted to create a surplus or surpluses in the electric system or systems of such member or 'members during such period, when added to•services, output, capacity, energy, or any combination thereof available to such member or members during such period from facilities owned by such member or members or pursuant to one or more then -existing firm contractual 15of19 12/16/2011 10:07 AM tatutes uonstitutioii : vieNvuuuLes . vwu1c outuuiuc obligations which are not terminable prior to the end of such period without payment of a penalty, or both; or 5. Any combination of the above. Nothing contained in this paragraph shalt prevent such legal entity from selling the output of its ownership interest in any such electric project to any electric, utility or foreign public utility as emergency, scheduled maintenance, or economy interchange service. (e) All obligations and covenants of any such public agency or legal entity, or both, contained in any contract or agreement, which contract or agreement and obligations and covenants are authorized, permitted, or contemplated by this section, shall be the legal, valid, and binding obligations and covenants of the public agency or legal entity undertaking such obligations or making such covenants; and each such obligation or covenant shall be enforceable in accordance with its terms. (f) When contract payments by any such public agency contracting with any such legal entity or revenues of any such public agency contracting with any other person or persons with respect to an electric project are to be pledged as security for the payment of bonds or other evidences of indebtedness sought to be validated, the complaint for validation may make parties defendant to such action, in addition to the state and the taxpayers, property owners, and citizens of the county in which the complaint for validation is filed, including nonresidents owning property or subject to taxation therein: 1. Every public agency the contract payments of which are to be so pledged. 2. Any other person contracting with such public agency or legal entity, or both, in any manner relating to such electric project, and particularly with relation to any ownership or operation of any electric project; the supplying of electrical energy to such public agency or legal entity, or both; or the taking or purchase of electrical energy from the electric project. 3. The taxpayers, property owners, and citizens of each county or municipality in which each such public agency is located, including nonresidents owning property or subject to taxation therein, and the holders of any outstanding debt obligations of any such public agency or legal entity. Alt such parties who are made defendants and over whom the court acquires jurisdiction in such validation proceedings shall be required to show cause, if any exists, why such contract or agreement and the terms and conditions thereof should not be inquired into • by the court, the validity of the terms thereof determined, and the matters and conditions which are imposed on the parties to such contract or agreement and all such undertakings thereof adjudicated to be valid and binding on the.parties thereto. Notice of such proceedings shall be included in the notice of validation hearing required to be issued and published pursuant to the provisions of paragraph (7)(c); and a copy of the complaint in such proceedings, together with a copy of such notice, shall be served on each party defendant referred to in subparagraphs 1. and 2. who is made a defendant and over whom the court acquires jurisdiction in such validation proceedings. Any person resident of this state or any person not a resident of, or located within,. this state, whether or not authorized to transact business in this state, who contracts with any such public agency or legal entity, or both, in any manner relating to such electric project, may intervene in the validation proceedings at or before the time set for the validation hearing and assert any ground or objection to the validity and binding effect of such contract or agreement on his or her own behalf and on behalf ofany such public agency and of all citizens, residents, and property owners of the state. No appeal may be taken by any person who was not a party of record in:such proceedings at, the time the judgment appealed from was rendered. An adjudication as .tothe validity of any such contract or agreement -from which no appeal has- been taken within the time permitted by law from the date of entry of the judgment of validation or, if an -appeal is filed, which is confirmed on appeal shall be forever conclusive and binding 16 of 19 12/16/2011 1.0:07 Alv Statutes K. Constitution :view, Statutes : twine sunsnme W \9' VA' .1tu1,.It. ,,,,., upon such legal entity and all such parties who are made defendants and over whom the court acquires jurisdiction in such validation proceedings. (g) Each such public agency or legal entity, or both, which contracts with any other person or persons with respect to the ownership or operation of any electric project, and each such public agency which contracts with any legal entity for the support of, or supply of, power from an electric project, is authorized to pledge to such other person or persons or such legal entity, or -both, for the benefit of such electric project all or any portion of the revenues derived or to be derived: 1. In the case of any such public agency, from the ownership and operation of its electric or other integrated utility system; and 2. In the case of a legal entity, from the provision of products and services by it; and to pledge to such other person or persons or such legal entity, or both, for the benefit of such electric project any securities, contract rights, and other property. Each such legal entity is also authorized to pledge to, or for the benefit of, the holders of any bonds, notes, or other evidences of indebtedness issued by such legal entity, as security for the payment thereof, any revenues, securities, contract rights, or other property. Any such pledge shall specify the priority and ranking of such pledge in respect of other pledges, if any, of the same revenues, securities, contract rights, or other property by such public agency or legal entity. Any pledge of revenues, securities, contract rights, or other property made by any such public agency or legal entity, or both, pursuant to this section shall be valid and binding from the date the pledge is made. The revenues, securities, contract rights, or other property so pledged and then held or thereafter received by such public agency or legal entity, or any fiduciary, or such other person or persons shall immediately be subject to the lien of the pledge without any physical delivery thereof or further act; and the lien of the pledge shalt be valid and binding as against all parties having claims of any kind in tort, in contract, or otherwise against the public agency or legal entity making such pledge, without regard to whether such parties have notice thereof. The resolution, trust indenture, security agreement, or other instrument by which a pledge is created need not be filed or recorded in any manner. (h) Any such legal entity is authorized and empowered to sue and be sued in its own name. In the event that any such public agency or legal entity enters into a contract or an agreement with respect to an electric project located in another state, or owns an interest in an electric project located in another state, an action against such public agency or legal entity may be brought in the federal or state courts located in such state. (i) The provisions of this subsection shall be liberally construed to effect the purposes hereof. The powers conferred by the provisions of this subsection shall be in addition and supplementary to the powers conferred by the other provisions of this section, by any other general, local, or special law, or by any charter of any public agency. When the exercise of any power conferred on any public agency or any legal entity by the provisions of this subsection would conflict with any limitation or requirement upon such public agency or such legal entity contained in the other provisions of this section, in any other general, local, or special taw, except s. 361.14, or in the charter of such public agency, such limitation or requirement shalt be superseded by the provisions of this subsection for the purposes of the exercise of such power pursuant to the provisions of this subsection. (j) While any bonds or other evidences of indebtedness issued by any such public agency or any such legal entity pursuant to the authority granted by paragraph (7)(c) or other applicable law remain -" outstanding, or while any.such public agency or any such legal entity has any undischarged duties or • obligations under any contract or agreement, including, but hot limited to, obligations to any operator or joint owner of any electric project, the powers, duties, or existence of such public agency or such legal 17 of 19 12/16/2011 10:07 AN statutes Q t—onsutuuUi1 : view J Let utc . viuiiic �u auui entity or of its officers, employees, or agents shall not be diminished, impaired, or affected in any manner which will affect materially and adversely the interests and rights of the owners of such bonds or other evidences of indebtedness or the persons to whom such duties or obligations are owed under such contract or agreement. The provisions of this subsection shall be for the benefit of the state, each such public agency, each such legal entity, every owner off the bonds of each such Legal entity or public agency, and every other person to whom such public agency or such legal entity owes a duty or is obligated by contract or agreement; and, upon and after the earlier of the execution and delivery by any public agency or legal entity, pursuant to this section, of any contract or agreement to any person with respect to an electric project, or the issuance of such bonds or other evidences of indebtedness, the provisions of this subsection shall constitute an irrevocable contract by the state with the owners of the bonds or other evidences of indebtedness issued by such public agency or legal entity and with the other person or persons to whom any such public agency or legal entity owes a duty or is obligated by any such contract or agreement. (k) •The limitations on waiver in theprovisions of s. 768.28 or any other law to the contrary notwithstanding, the Legislature, in accordance with s. 13, Art. X of the State Constitution, hereby declares that any such legal entity or any public agency of this state that participates in any electric project waives its sovereign immunity to: 1. All other persons participating therein; and 2. Any person in any manner contracting with a legal entity of which any such public agency is a member, with relation to: a. Ownership, operation, or any other activity set forth in sub -subparagraph (b)2.d. with relation to any electric project; or b. The supplying or purchasing of services, output, capacity, energy, or any combination thereof. (l) Notwithstanding the definition of "electric project" contained in paragraph (3)(d), or any other provision of this subsection or of part II of chapter 361 limiting the parties which may participate jointly in electric projects, any public agency of this state which is an electric utility, or any separate legal entity created pursuant to the provisions of this section, the membership of which consists only of electric utilities, and which exercises or proposes to exercise the powers granted by part II of chapter 361, may exercise any or all of the powers provided in this subsection jointly with any other person with respect to the acquisition, extraction, conversion, use, transportation, storage, reprocessing, disposal, or any combination thereof of any primary fuel or source thereof, as well as any other materials resulting therefrom, only when such primary fuel or source thereof is to be used for the generation of electrical energy in one or more electric projects by such legal entity, any member thereof, or any combination thereof; and, in connection therewith, any such public agency or Legal entity shall be deemed to have all the additional powers, privileges, and rights provided in this subsection. (m) In the event that any public agency or any such legal entity, or both, should receive, in connection with its joint ownership or right to the services, output, capacity, or energy of an electric project, as defined in paragraph (3)(d), any material which is designated by the person supplying such material as proprietary confidential business information or which a court of competent jurisdiction has designated as confidential or secret shall be kept confidential and shall be exempt from the provisions of s. 119.07(1). As used in this paragraph, "proprietary confidentialbusiness information" includes, but is not limited to, trade'secrets;'internal auditing controls and reports of internal auditors; security measures, systems, or procedures;' information concerning bids or other.:contractuat data, the disclosure of which . would impair the efforts of the utility to contract for services on favorable terms; employee personnel information unrelated to compensation, duties, qualifications,. or -responsibilities; and formulas, patterns, 18 of 19 12/16/2011 10:07 ANi Statutes L;onSt1tUt1 Un : V]CW JtatuLes i. V1U111C JU11J11u Lc devices, combinations of devices, contract costs, or other information the disclosure of which would injure the affected entity in the marketplace. (16)(a) All of the additional powers and authority granted by chapter 82-53, Laws of Florida, to a public agency as defined in paragraph (3)(b), a legal entity created pursuant to the provisions of this section, or both, respecting agreements for participation in electric projects shall apply to any agreement in existence as of March 25, 1982, as welt as to any such agreement entered into thereafter; but no additional limitation provided in chapter 82-53 upon any power or authority of any such public agency or - legal entity, or both, respecting agreements for participation in electric projects shall apply to any such agreement entered into prior to March 25, 1982. (b) Chapter 82-53, Laws of Florida, shall be deemed to be enacted for the purpose of further implementing the provisions of s. 10(d), Art. VII of the State Constitution, as amended. (17) In any agreement entered into pursuant to this section, any public agency or separate legal entity created by interlocal agreement may, in its discretion, grant, sell, donate, dedicate, lease or otherwise convey, title, easements or use rights in real _property,.including tax -reverted real property, title to which is in such public agency or separate legal entity, to any other public agency or separate legal entity created by intertocal agreement. Any public agency or separate legal entity created by interlocal agreement is authorized to grant such interests in real property or use rights without consideration when in its discretion it is determined to be in the public interest. Real property and interests in real property granted or conveyed to such public agency or separate legal entity shall be for the public purposes contemplated in the interlocal agreement and may be made subject to the condition that in the event that said real property or interest in real property is not so used, or if used and subsequently its use for such purpose is abandoned, the interest granted shall cease as to such public agency or separate legal entity and shall automatically revert to the granting public agency or separate legal entity. History.-ss. 1, 2, ch. 69-42; ss. 11, 18, 35, ch. 69-106; s. 1, ch. 79-24; ss. 1, 2, ch. 79-31; s. 61, ch. 79-40; s. 68, ch. 81-259; ss. 1, 7, 8, ch. 82-53; s. 45, ch. 83-217; s. 21, ch. 85-55; s. 1, ch. 87-9; s. 6, ch. 87-237; s. 46, ch. 88-130; ss. 33, 34, ch. 90-360; s. 83, ch. 91-45; s. 11, ch. 93-51; s. 896, ch. 95-147; s. 45, ch. 96-406; s. 19, ch. 97-236; s. 61, ch. 99-2; s. 23, ch. 99-251; s. 1, ch. 2001-201; s. 72, ch. 2002-295; s. 156, ch. 2003-261; s. 10, ch. 2004-5; s. 1, ch. 2004-336; s. 6, ch. 2006-218; s. 1, ch. 2006-220; s. 1, ch. 2007-1; s. 1, ch. 2007-90; s. 1, ch. 2008-43. Copyright © 1995-2011 The Florida Legislature Privacy Statement • Contact Us 19 of 19 12/16/2011 10:07 AM tatutes & . onsmuuon : vltvv. ,tatacs . viuuic �wioiu w Select Year: 2011 The 2011 Florida Statutes Title XI COUNTY ORGANIZATION AND INTERGOVERNMENTAL RELATIONS Chapter 163 INTERGOVERNMENTAL PROGRAMS View Entire Chapter 163.08 Supplemental authority for improvements to real property.— (1)(a) In chapter 2008-227, Laws of Florida, the Legislature amended the energy goal of the state comprehensive plan to provide, in part, that the state shall reduce its energy requirements through enhanced conservation and efficiency measures in all end -use sectors and reduce atmospheric carbon dioxide by promoting an increased use of renewable energy resources. That act also declared it the public policy of the state to play a leading role in developing and instituting energy management programs that promote energy conservation, energy security, and the reduction of greenhouse gases. In addition to establishing policies to promote the use of renewable energy, the Legislature provided for a schedule of increases in energy performance of buildings subject to the Florida Energy Efficiency Code for Building Construction. In chapter 2008-191, Laws of Florida, the Legislature adopted new energy conservation and greenhouse gas reduction comprehensive planning requirements for local governments. In the 2008 general election, the voters of this state approved a constitutional amendment authorizing the Legislature, by general taw, to prohibit consideration of any change or improvement made for the purpose of improving a property's resistance to wind damage or the installation of a renewable energy source device in the determination of the assessed value of residential real property. (b) The Legislature finds that all energy -consuming -improved properties that are not using energy conservation strategies contribute to the burden affecting all improved property resulting from fossil fuel energy production. Improved property that has been retrofitted with energy -related qualifying improvements receives the special benefit of alleviating the property's burden from energy consumption. All improved properties not protected from wind damage by wind resistance qualifying improvements contribute to the burden affecting all improved property resulting from potential wind damage. Improved property that has been retrofitted with wind resistance qualifying improvements receives the special benefit of reducing the property's burden from potential wind damage. Further, the installation and operation of qualifying improvements not only benefit the affected properties for which the improvements are made, but also assist in fulfilling the goals of the state's energy and hurricane mitigation policies. In order to make qualifying improvements more affordable and assist property owners who wish to undertake such improvements, the Legislature finds that there is a compelling state interest in enabling property owners to voluntarily finance such improvements with local government assistance. (c) The Legislature determines that the actions authorized under this section, including, but not limited to, the financing'of qualifying improvements through the execution of financing agreements and the related imposition 'of voluntary assessments are reasonable and necessary to serve and achieve a compelling state interest and are necessary for the prosperity and welfare of the state and its. property owners and inhabitants. (2) As used in this section, the term: 1 of 4 12/16/2011 10:07 AN Statutes d: Constitution :View Statutes : online sunshine nt[p:iiwww.ieEi.state.u.usIsiatutesiuwex.uut ri},p_,uuue—Ltspiay_3in.. (a) "Local government" means a county, a municipality, or a dependent special district as defined in s. 189.403. (b) "Qualifying improvement" includes any: 1. Energy conservation'and efficiency improvement, which is a measure to reduce' consumption through' conservation or a more efficient use of electricity, natural gas, propane, or other forms of energy on the property, including, but not limited to, air sealing; installation of insulation; installation of energy -efficient heating, cooling, or ventilation systems; building modifications to increase the use of daylight; replacement of windows; installation of energy controls or energy recovery systems; installation of electric vehicle charging equipment; and installation of efficient lighting equipment. 2. Renewable energy improvement, which is the installation of any system in which the electrical, mechanical, or thermal energy is produced from a method that uses one or more of the following fuels or energy sources: hydrogen, solar energy, geothermal energy, bioenergy, and wind energy. 3. Wind resistance improvement, which includes, but is not limited to: a. Improving the strength of the roof deck attachment; b. Creating a secondary water barrier to prevent water intrusion; c. Installing wind -resistant shingles; d. Installing gable -end bracing; P. Reinforcing roof -to -wall connections; f. Installing storm shutters; or g. Installing opening protections. (3) A local government may levy non -ad valorem assessments to fund qualifying improvements. (4) Subject to local government ordinance or resolution, a property owner may apply to the local government for funding to finance a qualifying improvement and enter into a financing agreement with the local government. Costs incurred by the local government for such purpose may be collected as a non -ad valorem assessment. A non -ad valorem assessment shall be collected pursuant to s. 197.3632 and, notwithstanding s. 197.3632(8)(a), shall not be subject to discount for early payment. However, the notice and adoption requirements of s. 197.3632(4) do not apply if this section is used and complied with, and the intent resolution, publication of notice, and mailed notices to the property appraiser, tax collector, and Department of Revenue required by s. 197.3632(3)(a) may be provided on or before August 15 in conjunction with any non -ad valorem assessment authorized by this section, if the property appraiser, tax collector, and local government agree. (5) Pursuant to this section or as otherwise provided by law or pursuant to a local government's home rule power, a local government may enter into a partnership with one or more local governments for the purpose of providing and financing qualifying improvements. (6) A qualifying improvement program may be administered by a for -profit entity or a not -for -profit organization on behalf of and at the discretion of the local government. (7) A local government may incur debt for the purpose of providing such improvements, payable from revenues received from the improved property, or any other available revenue source authorized by law. (8) A local government may enter into a financing agreement only with the record owner of the affected property. Any financing agreement entered into pursuant to this section or a summary rriernorandurri of such agreement shall be recorded in the public records of the county within which the 'property is located by the sponsoring unit of local government within 5 days after execution of the agreements The:recorded agreement shall, provide constructive notice that the assessment to be levied on the -property constitutes a lien of equal dignity to county taxes and assessments from the date of recordation. 2 of 4 12/ 16/2011 10:07 AM Statute-s uonsntution :view statutes : unitne urisnirie / V1. V1' YV.I A AYY_••••••••• •.• "Y' ••-•••. (9) Before entering into a financing agreement, the local government shall reasonably determine that all property taxes and any other assessments levied on the same bill as property taxes are paid and have not been delinquent for the preceding 3 years or the property owner's period of ownership, whichever is less; that there are no involuntary hens, including, but not limited to, construction liens on the property; that no notices of default or other evidence of property -based debt delinquency have been recorded during the preceding 3 years or the property owner's period of ownership, whichever is less; and that the property owner is current on all mortgage debt on the property. (10) A qualifying improvement shall be affixed to a building or facility that is part of the property and shall constitute an improvement to the building or facility or a fixture attached to the building or facility. An agreement between a local government and a qualifying property owner may not cover wind -resistance improvements in buildings or facilities under new construction or construction for which a certificate of occupancy or similar evidence of substantial completion of new construction or improvement has not been issued. (11) Any work requiring a license under any applicable law to make a qualifying improvement shall be performed by a contractor properly certified or registered pursuant to part I or part II of chapter 489. (12)(a) Without the consent of the holders or loan servicers of any mortgage encumbering or otherwise secured by the property, the total amount of any non -ad valorem assessment for a property under this section may not exceed 20 percent of the just value of the property as determined by the county property appraiser. (b) Notwithstanding paragraph (a), a non -ad valorem assessment for a qualifying improvement defined in subparagraph (2)(b)1. or subparagraph (2)(b)2. that is supported by an energy audit is not subject to the limits in this subsection if the audit demonstrates that the annual energy savings from the qualified improvement equals or exceeds the annual repayment amount of the non -ad valorem assessment. (13) At least 30 clays before entering into a financing agreement, the property owner shall provide to the holders or loan servicers of any existing mortgages encumbering or otherwise secured by the property a notice of the owner's intent to enter into a financing agreement together with the maximum principal amount to be financed and the maximum annual assessment necessary to repay that amount. A verified copy or other proof of such notice shalt be provided to the local government. A provision in any agreement between a mortgagee or other lienholder and a property owner, or otherwise now or hereafter binding upon a property owner, which allows for acceleration of payment of the mortgage, note, or lien or other unilateral modification solely as a result of entering into a financing agreement as provided for in this section is not enforceable. This subsection does not limit the authority of the holder or loan servicer to increase the required monthly escrow by an amount necessary to annually pay the qualifying improvement assessment. (14) At or before the time a purchaser executes a contract for the sale and purchase of any property for which a non -ad valorem assessment has been levied under this section and has an unpaid balance due, the seller shall give the prospective purchaser a written disclosure statement in the following form, which shall be set forth in the contract or in a separate writing: QUALIFYING IMPROVEMENTS FOR ENERGY EFFICIENCY, RENEWABLE ENERGY, OR WIND 'RESISTANCE: —The property being purchased is located withinthe jurisdiction_ of a local government that has placed an assessment on the property pursuant to s. -163.08, Florida Statutes. The assessment is for a qualifying improvementto the property relating to energy efficiency, renewable energy, or 'wind resistance;'and is not based on thevalue of property. ,You are encouraged to contact the county 3 of4 12/16/2011 10:07 AM ,statutes a Uonsttturnon : view : unttne 'unstuue Vi' 11' OltALLLALV6, u............. ....YY_., .. ,� ..1.....J _......... property appraiser's office to learn more about this and other assessments that may be provided by law. (15) A provision in any agreement between a local government and a public or private power or energy provider or other utility provider is not enforceable to limit or prohibit any local government from exercising its authority under this section. (16) This section is additional and supplemental to county and municipal home rule authority and not in derogation of such authority or a limitation upon such authority. History.—s. 1, ch. 2010-139. Copyright O 1995-2011 The Florida Legislature • Privacy Statement • Contact Us 4 of 4 12/16/2011 10: 07 AM r1 V�1 at11 \N 111 lll.l}l 11V1114v v1'11t.1J puy tvl vli f-tel amlicrc Posted on Sat, Oct. 08, 2011 Program will help homeowners pay for energy efficiency BY PERRY STEIN pstein(a�MiamiHerald.com It's no secret that owners of homes and businesses can save money on electricity by installing new windows, more efficient air conditioners, and other household improvements. The trouble is coming up with the cash. But anew partnership between a national consortium of five private businesses and six South Florida cities promises to offer low -interest financing to help property owners make these upgrades, provided that the improvements will pay for themselves in reduced power bills. The consortium, set up by British music and airline tycoon Sir Richard Branson, will invest $550 million in South Florida, which will be the first of two U.S. markets for the venture. The consortium says its investment will cut energy bills and produce thousands of jobs, as workers will be needed to install the upgrades. The cities Cutler Bay, Palmetto Bay, Pinecrest, South Miami, Coral Gables and the city of Miami — are starting to sign deals with the consortium now, and the first upgrade projects could start in early2012. "This is a very bold program," said Cutler Bay Mayor Ed MacDougall, whose town is taking the lead on the project. "We're reducing the amount of energy we consume and someone has to start somewhere. This is an opportunity where municipalities can ban together for a common cause." The five companies include Barclay, the largest U.K.-based bank; defense and technology conglomerate Lockheed Martin; energy finance start-up firm Ygrene; Energi Insurance Services; and Germany's Hannover Re, which is also the third largest reinsurance firm in the world. Carbon War. Room, a nonprofit group started by Branson, who is best known for founding Virgin Records and Virgin Airways, came up with the idea and brought the other players to the table. Here's how the program will work: First, at the request of a property owner, Ygrene sends a specialist to perform an "energy audit" of the property, evaluating what improvements are needed and how much money could be saved if these upgrades are made. If the cost of the upgrades up to a 20-year period is -less than the energy savings, then the property:.►s_el_igible.for .the program. Nexf, the customer agrees to the financing arrangement, whereby they will repay the money each year as a surcharge on their local tax bill. 1 of 3 12/12/2011 12:51 PM 1 y51 U111 VV 111 flvlr 1at/alauvrr ♦a...0 ruJ ay. ....... .7J ..��.—.—. _J Then, local contractors will install the upgrades. Lockheed Martin will compete to be the contractor in some of the larger commercial projects. Finally, Ygrene pays the contractor and the property owner begins repaying the debt. "The idea is to use businesses and markets to address climate change," said Murat Armbruster, senior advisor for the Carbon War Room. "We realized that any one company trying to address this problem doesn't have the full ability to address the problem." The companies bring their financial resources and special expertise while the cities ensure the debts are repaid by collecting them as a surcharge on the property owner's tax bill rather than an ordinary loan payment. If the property is sold, the lien stays with the property and is passed on to the next owner. Miami -Dade is the big start-up area for Carbon War Room's project. The same consortium will be operating concurrently in Sacramento with $100 million. If successful, the consortium could expand to other cities throughout the nation and in South Florida, including Broward County. The project relies on some novel arrangements between the companies and cities, which are made possible under a 2010 state law called the Property Assessed Clean Energy Act, or PACE. It allows local municipalities to finance energy upgrades through property assessments. Of the six participating cities, Cutler Bay and South Miami have officially signed on; the others are expected to follow suit in coming weeks. Cutler Bay's Mayor MacDougall said that his town was looking to get involved with a PACE program and sent out a request for proposals of interested parties looking to work with them. Ygrene responded and Cutler Bay staff helped assemble the first cities in the Green Corridor District based on what made geographical and economic sense. The cities will sign agreements with one another and form the Green Corridor District, a separate legal entity that, under the PACE law, allows them to work together to finance these energy -efficient projects. Each city will have one representative sit on the Green Corridor board, and would act as a check on the consortium to ensure that Ygrene is administrating the program effectively. Chad Friedman, a lawyer with the law firm Weiss Serota Helfman Pastoriza Cole & Boniske, which represents many municipalities in the area, will serve as the district's attorney. Cities have used special assessment districts in the past to pay for community improvements like street lights, not individual projects opted into by property owners. By law, residential properties can only spend 10 percent of their home's market value on energy upgrades through PACE financing. The average home value in the Green Corridor district is about $238,000, which means the average _homeowner can spend a maximum of $23,'800-on upgrades like -solar panels, hurricane windows and new hot water heaters. For -commercial properties, contractors will offer a warranty to ensure that the owners actually see the expected savings in their utility bills. Energi, an insurance underwriter, will back that warranty and Hannover Re would then back those insurance contracts. 2 of 3 12/12/2011 12:51 PM Program will help homeowners pay for energy eihclency: 1 U/Ua/Lu11... ntrp://www.rmarmneratu.euuuzvi ii iv/Ow v pr,liu .L ow�iv aiif wi.. "If you are going to borrow money, ours will be the cheapest by far, period," said Dan Schaefer, president of Ygrene Energy Fund, adding that the interest rates would typically hover around 6 to 7 percent. "It just depends on the market." Mortgage finance agencies Fannie Mae and Freddie Mac, however, have concerns about the PACE legislation, which has been passed in 27 states. The two big mortgage backers — which guarantee half the nation's $11 trillion in mortgages = are unhappy about the tax -like legal status of the consortium's loans. The reason: in the event the borrower defaults, taxing authorities get paid before the mortgage holder. Until disputes with Fannie and Freddie are settled, Branson's Carbon War Room has said its consortium will only focus on retrofitting commercial properties. Ygrene, however, has said it would finance residential projects, promising to cover costs of any future legal issues. The Fannie Mae dispute is one of the reasons the consortium is starting its work in Florida and California. In these states, Schaefer said, there are strong PACE laws which say that property owners only have to notify their lenders, not get approval, if they want to finance through PACE. Controversy aside, environmental groups and advocates have lauded the consortium as a game -changer that would alleviate a reliance on federal dollars for expensive energy efficient projects and would bring much needed jobs to the area. Susan Glickman, a consultant for the Natural Resources Defense Council, said that renewable energy creates more jobs than any other source of energy. For every $4 million in PACE spending, $10 million dollars flows through the economy and 60 new jobs are created, according to an April 2011 study by ECONorthwest. Based on these projections, Branson's consortium would pump more than $1 billion into the economy and create more than 8,000 jobs. "It's a brilliant model," Glickman said. Efficient energy "is very local and will put the very people to work in Florida who have been laid off due to the poor economy and lack of construction." Ygrene Energy will also open an energy center in Miami -Dade that would operate the Green Corridor program. The building would be equipped with an educational center where people can host events, talk and learn about renewable energy. As the consortium expands, Ygrene hopes to open additional energy centers. "It will be a place where you can come and learn about this because I don't think anyone wakes up and says `jeez I want to retrofit my property today," Schaefer said. © 2011 Miami Herald Media Company. AM Rights Reserved. http://www.miamiherald.com 3 of 3 12/12/2011 12:51 PM Tax Plan to Turn Old Buildings `Green' Finds Favor - NYTimes.corn' http://www.nytimes.conv-ul1iuw zuinusinessienergy-env lronnienui.ax.:, tttr ark i(nne5 Reprints This copy is for your personal, noncommercial use only. You can order presentation -ready copies for distribution to your colleagues, clients or -customers here or use the "Reprints" tool that appears next to any article. Visit www.nytreprints.com for samples and additional information. Order a reprint of this article now. September 19, 2011 r dendants Tax Plan to Turn Old Buildings Green' Finds Favor By JUSTIN GILLIS A business consortium that includes Lockheed Martin and Barclays bank plans to invest as much as $650 million over the next few years to slash the energy consumption of buildings in the Miami and Sacramento areas. It is the most ambitious effort yet to jump-start a national market for energy upgrades that many people believe could eventually be worth billions. Focusing mainly on commercial property at first, the group plans to exploit a new tax arrangement that allows properly owners to upgrade their buildings at no upfront cost, typically cutting their energy use and their utility bills by a third. The building owners would pay for the upgrades over five to 20 years through surcharges on their propel ly-tax bills, but that would be less than the savings. The consortium is led by a company called Ygrene Energy Fund of Santa Rosa, Calif., which has already won an exclusive contract to manage a retrofit program for a half -dozen communities in the Miami area, with the city expected to join in a few weeks. It is in the late stages of completing a contract with Sacramento, and is seeking deals in other cities. State and city officials are optimistic they may have found a way to tackle one of the nation's biggest energy problems — waste in older buildings — without new money from Washington. If enough building owners sign on, private capital would be put to work paying for retrofit projects that promise to save local businesses money while creating thousands of new construction jobs. "We are so used to reaching our hand out and saying, `Washington, we need this,' and `Tallahassee, give us that,' " said Edward MacDougall, the mayor of Cutler Bay, Fla., a Miami suburb that took the lead in setting up the deal in that region. "This is really a home-grown mechanism where we don't need to do that." The'consortium-was`put together by the Carbon War Rooin;.a_ nonprofit environmentalgroup -based`in Washingtoii-set up by Richard Branson, the British entrepreneur and billionaire, to • tackle the world's climate and energy problems in cost -saving ways. With :the United. States 1 of 4 12/12/2011 12:52 PM Tax Plan to Turn Old Buildings `.GreenFinds Favor - NY'1 imes.com http://www.nynmes.com/•%u1 i/uvi�u/nusmessienergy-environnienvrax... government nearly paralyzed on climate policy, he said, his group is seeking a way forward. "We see this as the first of hopefully many, many, many projects, and a big step in the right direction," Mr. Branson said in an interview last weekend in New York. In the past three years, half the states have passed legislation permitting energy retrofits financed by property -tax surcharges, and hundreds of cities and counties are considering such programs. While the situation poses some risks, and programs aimed specifically at homeowners have run into a snag, many jurisdictions are moving forward with plans to focus on commercial properties. Environmental groups have lauded the trend as one of the most exciting developments in years regarding climate change. They point out that wide use of such programs could cut emissions of heat -trapping carbon dioxide from power plants by reducing electricity demand. "It's a big deal," said James D. Marston, head of energy programs for the Environmental Defense Fund, a group that has worked with Carbon War Room in developing the approach. Over the long haul, he said, "we're talking about tens of billions of dollars in investments, and energy savings that are 10 times that amount. If you do this correctly, you would be able to shut down a third of the coal plants in the country." While that may take a while, there seems to be little question that the new approach could draw substantial private capital into the market for energy upgrades, which have historically been difficult for many midsize and smaller businesses to finance. As envisioned for Miami and Sacramento, the plans will work like this: Ygrene and its partners will gain exclusive rights for five years to offer this type of energy upgrade to businesses in a particular community. They will-inarketthe plan aggressively, helping propel Ly owners figure out what kinds of upgrades make sense for them. Lockheed Martin is expected to do the engineering work on many larger projects. The retrofits might include new windows and doors, insulation, and more efficient lights and mechanical systems. In some cases, solar panels or other renewable power might be included. For factories, the retrofits might include new motors or other gear. Short-term loans provided by Barclays Capital will be used to pay for the upgrades. Contractors Will offer a warranty that the utility savings they have promised will actually materialize, -and an insurance underwriter, Energi, of Peabody, Mass., will back up that warranty. Those insurance contracts, in turn, will be backed by Hannover Re, one of the world's largest reinsurance companies. 2 of4 12/12/2011 12:52 PM Tax Plan to Turn Old Buildings `Green' Finds Favor-NYTimes.com http://www.nytimes.com/20] 1/09/20/business/energy-environment/tax... As projects are completed, the upgrade loans, typically carrying interest rates of 7 percent, will be bundled into long-term bonds resembling those routinely issued by governmental taxing districts. Barclays will market the bonds. Retirement funds have expressed interest in buying these bonds, which will be repaid by tax surcharges on each property that undergoes a retrofit. Perhaps the most serious risk is that fly-by-night contractors will be drawn to the new pot of money, pushing energy retrofits that are too costly or work poorly. "Contractors are cowboys," said Dennis Hunter, chairman of Ygrene. He promised close scrutiny of the ones selected for the Miami and Sacramento programs. Ygrene is one of about a dozen start-up companies around the country pursuing such deals. The company appears to have substantial momentum, but some of its competitors have already stumbled, telling property owners they qualified for retrofits but then failing to deliver the necessary short-term financing. Still, many people are optimistic this approach will get off the ground. "This is a game -changer," said John D. Kinney, whose company, Clean Fund of San Rafael, Calif., has raised $250 million to invest in such projects. The company just used the technique to help finance a large solar installation at a development called Sonoma Mountain Village in Rohnert Park, Calif. Experts point out that, with modern techniques and equipment, a retrofit can typically cut a building's energy use so much that the project pays for itself in as little as five years. The most famous recent example was the refurbishment of the Empire State Building, which cut energy use by nearly 4o percent; turning it into one of New York's greenest buildings. The new financing approach is called Property Assessed Clean Energy, or PACE. For decades, cities and counties have created special taxing districts to finance improvements that benefit private property, such as street lights or sewers. Bonds are issued to pay for the projects, then repaid with surcharges on tax bills. If an owner sells, the surcharge stays with the property. Several years ago, the city of Berkeley, Calif., hit on the idea of using that approach to finance energy upgrades on private homes. The idea took off, and 25 states and the District of Columbia -soon passed PACE legislation. One of the most successful programs to ;date has been - in Sonoma County, Calif., where retrofit projects exceeding $50 million: have been financed.. While the initial .focus was on homeowners, those programs slowed last year when an arm of 'the federal government that oversees the mortgage market took a hostile stance toward such 3 of 4 12/12/2011 12:52 PM Tax Plan to Turn Old Buildings `Green Finds Favor - NYTimes.com ;http: //www.nytimes.corry U11/u9/ uitusinessienergy-env1ronmenurax... projects on residential property, on the grounds that they add risk to mortgages. In most states, a lien associated with a retrofit project would have to be paid ahead of the mortgage if the properly went into foreclosure. A legal and political battle is under way to try to force the Federal Housing Finance Agency to reverse its stand. So far, it appears that PACE programs for commercial properties pose fewer legal complications. 4 of 4 12/12/2011 12:52 PM Ygrene Makes S10O Million Conrn trnent in White Nouse's better t5U'1... nap:// w wW:pi imuns.et!eNcluillLy.uviivpt./ ,c—o rgl PRIM -THIS Ygrene Makes $100 Million Commitment in White House's Better Buildings Challenge Company joins select group of energy efficiency financing leaders to create thousands of jobs WASHINGTON, Dec. 2, 2011 /PRNewswire/ -- Ygrene Energy Fund, a leading provider of energy efficiency programs for local governments, today announced it has been selected by the Department of Energy as a financial ally in support of the White House's Better Buildings Challenge. Ygrene joins the ranks of top tier financing leaders, cities and companies committed to energy efficiency that will save billions in energy costs and spur job creation. (Logo: http://photos.prnewswire.com/prnh/20111109/LA03200LOGO) The Better Buildings Challenge, part of the President's Better Building Initiative, aims to increase energy efficiency in buildings by 20 percent over the next decade and reduce energy costs for American businesses by nearly $40 billion. To achieve these ambitious targets, Ygrene has committed to unlock a minimum of $100 million in commercial building energy efficiency improvements over the next 12 months. Together, the .retrofit projects will result in .at least $250 million in economic activity and create more than 1,500 jobs. "The Better Buildings Challenge brings together.a community of decision makers with the power to finance and implement deep energy savings in the near -term. Together, we'll make investing in energy efficiency simple and affordable for all sizes of businesses," said Dennis Hunter, Ygrene CEO: "Ygrene offers local governments a secure and efficient financing pathway to achieve their clean energy goals at no cost to them." Ygrene partners with cities and counties to deploy its no -cost Property Assessed Clean Energy (PACE) programs funded with readily available private capital. Ygrene's financing solutions enable property owners to make energy efficiency and renewable energy upgrades, repayable over the' long term via property -taxes. Gaining traction nationwide, the Ygrene model is currently in -development`with"the City 'of Sacramento, a Better Buildings 'Challenge Community Partner, as well as Member communities of the Green Corridor Districtin Southern Florida. "Sacramento is committed to reducing energy use by 20 percent by 2020 in more than 12 million 1 of 2 12/12/2011 12:51 PM Ygrene Makes $100 Million Commitment in White House's Better Hull._. ntip://www.prinunis.cucKautht.y.ciniuptiepi.:cmil c—o:,i,uc—, square feet of building space, and Ygrene's streamlined approach plays a critical role in achieving this vision," said Sacramento Mayor Kevin Johnson. "By partnering with Ygrene, Sacramento is able'to tap private funds needed to stimulate and scale commercial building retrofits, while creating valuable green jobs." About Ygrene Energy Fund Ygrene Energy Fund, headquartered in Santa Rosa, California, is the leading developer and administrator of Property Assessed Clean Energy (PACE) financing programs in the US. PACE is an innovative structure enabling business and residential property owners to finance energy savings improvements. Assembled by the Carbon War Room, Ygrene leads "The Commercial PACE Consortium" a coalition, of leading financial, energy efficiency and climate change organizations to deliver no -cost, turnkey PACE financing on behalf of municipal governments. Founding members include Barclay's Capital, Lockheed Martin, and Energi. Learn more at www.ygrene.•us. SOURCE Ygrene Energy Fund Back to top RELATED LINKS http://www.ygrene.us Find this article at: http://www. prnewswi re. com/news-releases/ygrene-makes-100-mi Ilion-commitment-i n-white-houses-better-bui Idi ngs-challenge- 134894043.html?TC=CrowdFactory_Twitter&cf from=http%3A%2F%2Fvww.prnewswire.com%2Fnews-releases%2Fygrene-makes- 100-milli on-commitment-i n-white-houses-better-bui Idi ngs-challenge-134894043. html&cf_synd_id=32TnvCc Eli Check the box to include the list of links referenced in the article. 2 of 2 12/12/2011 12:51 PM Lykes=Bros.' EcoAsset Solutions Joins Ygrene Energy Fund to Drive Fi... http://www.esrwu-e.convpress_rereaStsr.»>uc-Lyxes-tiros-r,coAsser... The Corporate Sociat ke_nonsit ility Nsxrwrire Follow us on: CSR Press Release Lykes Bros.' EcoAsset Solutions Joins Ygrene Energy Fund to Drive Florida Job Creation Florida -based business could create thousands of local jobs through commercial and residential building energy improvements Submitted by: Ygrene Energy Fund Categories: Community Development, Renewable & Alternative Energy Posted: Nov 09, 2011 — 10:28 AM EST MIAMI, Nov. 09 /CSRwire/ - /PRNewswire/ - Ygrene Energy Fund, a leading provider of energy retrofit programs for local governments, today announced it has partnered with Tampa -based sustainability consultancy EcoAsset Soiutions to market Ygrene Energy Fund Florida, LLC (Ygrene Florida). Using an innovative financing model to enable building energy improvements, Ygrene Florida will partner with Florida's local governments to reduce energy costs in businesses and homes, stimulate local economies and create thousands of jobs. EcoAsset Solutions, a wholly —owned subsidiary of Lykes Bros. Inc.,•has proven experience in the design and management of long-term sustainability programs for state and local governments. Together with Ygrene Energy Fund, EcoAsset will contribute its resources to Ygrene Florida to drive program implementation by local governments as well as property owner participation. "Ygrene Florida provides.an immediate, sustainable source of private capital to finance property upgrades with no cost to the local government. It's one of the most potent tools within our reach to strengthen the state's economy. Florida needs this," said John Wakefield, president and COO of EcoAsset Solutions. "By implementing Ygrene Florida's.unique model, we anticipate creating thousands of jobs throughout the state over the next five years." Ygrene Florida's turnkey energy efficiency program provides ready private capital to property owners who choose to improve the energy use of their commercial or residential building. The funding for eligible building improvements —.including a range of energy efficiency retrofits,. renewable energy installations as well as wind hardening improvements— is repaid via annual non ad valorem assessments on the property tax bill amortized over as much as 15 to 20 years. The savings resulting from the property improvements exceed the overall costs of the improvements. Ygrene Florida has appointed Joseph Spector as director of operations to lead program implementation and marketing in Miami. Spector joins Ygrene Florida from senior management positions at Briggs & Stratton Corporation, a global manufacturer and distributor of power products and engines. He was responsible for the establishment of Briggs & Stratton operations in Mexico and Brazil, and most recently served as the managing director of Latin American operations in Miami. "The Ygrene funding model cuts through layers of red tape and provides a fast, efficient approval process for local contractors to execute projects in unprecedented numbers," said Spector. "Businesses and homeowners will benefit from lower utility costs, higher property values and increased cash flow. Furthermore, governments unlock enormous job potential while accelerating smart city development and protecting their financial outlook." About Ygrene Energy Fund Florida Ygrene Energy Fund Florida, headquartered in Tampa, is the leading developer and administrator of Property Assessed Clean •'"Energy (PACE) financing programs throughout the state. PACE is an innovative structure enabling property owners to finance ' eriergy savings`imp"rovements.`Assembled by the Carbon War Room, Ygrene leads "The PACE Commercial Consortium" a coalition of leading financial, energy efficiency and climate change organizations to deliver no -cost, turnkey PACE financing on behalf of • municipal governments."Founding members include Barclay's Capital, Lockheed Martin and Energi. Learn more at www.ygrene.us. About EcoAsset Solutions 1 of2 12/12/2011 12: 51 PM Lykes Bros.' EcoAsset Solutions Joins Ygrene hner' Fund to Drive Pi... nttp://www.csrw1re.L;p111/pleS_l cicascsf UJ-Ly1S.cs-DI us :�curisscr... EcoAsset Solutions is an award -winning leader in providing Sustainability Management outsourcing services for the public and private sector. The, company's aim is to be the trusted strategic service partner for organizations that are trying to design, implement and drive a sustainability agenda that improves competitiveness, grows revenue, and eliminates resource waste to improve profit margins. EcoAsset's mission is to provide solutions that prove the value of our client's sustainability investments. The company is a wholly —owned subsidiary of Lykes Bros. Inc., a fifth generation family -owned company with over one hundred years of experience and financial stability in managing large scale natural resources. For more information, please contact: Beth Ross Antenna Group for Ygrene Phone: +1-415-977-1950 2 of 2 12/ 12/2011 12: 51 PM PACE-One-Page-Pritnerl .jpg (JPEG Image, 2549x3300 pixels) - Scale... http://pacenow.orgibloJwp-contenvupioaasirH� n-vne-rake-rrmieri.jpe Property Assessed_ Clean Energy fnavaekkr far Financing Energy Efficiency PACE is Property Assessed Clean Energy, a bipartisan, local government initiative that allows property owners to finance energy efficiency and renewable energy projects for their homes and commercial buildings, simply and with no government subsidies. PACE is Voluntary. interested owners opt -in. to receive financing that is repaid through an assessment on their property taxes for up to 20 years. This spreads the cost of energy improvements — weather -sealing, better insulation, more efficient• heating and. cooling systems, .solar installations, etc. — over the expected life of the improvements and allows the repayment obligation to transfer automatically to the next property owner if the building is sold (along with the benefits of the improvements). Why PACE? PACE solves two key barriers that hinder adoption of energy efficiency and small-scale renewable energy. Long-term financing eliminates the upfront cost barrier and assessments that transfer to a new owner upon sale ensure that current and future owners pay fairly for improvements that remain with the property. Unlike state or utility sponsored programs that seem distant and bureaucratic, PACE programs provide a way for local communities to sponsor programs that meet their individual needs. State. Government Majority when PACE Legislation Passed Republican ivixjority / Democratic Majority How PACE Works PACE uses the same kind of land -secured financing districts that American cities and towns have relied on for over 100 years to pay for improvements in the public interest. Over 37,000 land secured districts already exist and are a safe and familiar tool of municipal finance for street paving, parks, open space, water and sewer systems, street lighting, and seismic strengthening, among others. PACENow is an independent advocacy group for property assessed clean energy, a private capital market solution to financing energy efficiency and renewable energy projects that does not require government subsidies or taxes. Contact PACENow's Executive Director, David Gabrielson, at: david.pacenowagmail.com - • http://www.pacenow.org PACE is Unique • Creates permanent jobs - nationwide and across a range of skills. • Uses private capital for funding — requires NO taxes or government subsidies. • Voluntary — only opt -in participants receive benefits and agree to pay assessments. • Promotes energy security - without federal regulation or taxes that drive up energy costs. • Saves money and increases value — efficiency and renewable projects make buildings more valuable. • No upfront cost - PACE financing spreads costs over the life of improvements. • Assessment can transfer on sale - new owner benefits from improvements that stay with the property. • , Avoids costly power plants — difficult to site. • Improves air quality — makes communities healthier. What They're Saying? "PACE is a no -cost to taxpayers, no -mandate, consumer opt - in approach that brings clean energy technology to homeowners and businesses. PACE will help create jobs for Floridians at .a critical time when we are working to get Florida's economy back on track." Adam Hasner (R-FL) former Majority Leader, FL House of Representatives "PACE is already creating economic opportunity, energy savings, and environmental benefits through the retrofit of residential and commercial building stock." Gov Bill Ritter (D-CO) "A New York City PACE program providing property owners with the upfront capital to make energy efficiency retrofits will create jobs and reduce energy costs for residents and businesses." Mayor Michael Bloomberg (I -NYC) "1 am honored to be one of our nation's first Mayors to support PACE. San Diego plans to derive strong long .term advantages through PACE .programs and we urge the rest of our nation, on a bipartisan basis, to join us." Mayor Jerry Sanders (R-Son Diego) "With PACE, we are providing homeowners and business owners with powerful tools to take control of their energy use and create jobs at the same time" Gov Arnold Schwarzenegger (R-CA).._,...... 1 of 1 )2/16/2011 10:54 AM -APPENDIX TWO - PACE Financing Consumer Survey by Pike Research This survey, conducted by Pike Research in the first quarter of 2011, demonstrates the interest level of single-family homeowners in PACE financing. In addition, the survey breaks the responders down based on various factors and identifies the level of interest associated with specific energy -efficiency improvements. Key findings of the survey include: • 74% show some level of interest in a PACE program • 42% either "very interested" or "extremely interested" • Those with electric bills over $200 showed a significantly higher level of interest than those spending less on electricity • Solar panels and tankless water heaters were the most popular improvements, with each showing up on 63% of responses by interested homeowners • Additional financial liability and confusion over ,the PACE process were the two most popular reasons for a lack of interest. Company Confidential -APPENDIX THREE - Sonoma County Energy Independence Program by Rod Dole The Sonoma County Energy Independence Program is the most successful PACE program in the country. To date, the program has disbursed over $47 million to finance more than 2,500 residential and commercial projects within Sonoma County, CA. Rod Dole, currently the co-chairman of the Ygrene Energy Fund, served as Auditor, Controller, Treasurer and Tax Collector for Sonoma County until his retirement in the spring of 2011. In 2009, he led the team that developed and implemented the Sonoma County Energy Independence Program. He is widely considered the preeminent authority on PACE financing in the country and has testified before the US House Ways and Means Committee on the subject. The following is his latest presentation on the Sonoma County Energy Independence Program. v Company Confidential Brant ,Paves Research Analyst C nt ghee&ack President PikeResearch PACE Financing Consumer Survey Section 1 EXECUTIVE SUMMARY 1.1 introduction As efforts to curb energy demand turn to the residential sector, enabling homeowners to invest in energy saving home improvements has become an increasingly hot topic among regulators, activists and industry players. Willingness to invest in energy efficiency home improvements is often deterred by high costs and a reluctance to invest in projects with long payback periods when the average homeowner moves every five to seven years. In an effort to assuage these concerns, local and state governments began offering innovative financing.plans known.Property Assessed Clean Energy (PACE) programs. Under a PACE financing program, the cost of energy efficiency home improvements is paid back in the homeowner's annual property taxes via a special assessment on the home. Under such a program, a homeowner could install solar panels or additional insulation with little or no upfront costs and repayment plans of 15 to 20 years. In the event of a transfer of ownership, remaining payments would be made by the new owner because the assessment is tied to the property. This financing approach helps alleviate concerns about upfront costs and return on investment. As a result, numerous municipal governments began taking steps to make PACE programs available to their homeowners. By March 2010, 16 states had PACE -enabling legislation in place. Figure 1.1 States with PACE -Enabled Legislation: March 2010 Lawns Irnpa�r NQFns States T hat have approved.legisiation allcrwmtj rnunicipl6 to.set up FACE: pros}rams anti; It es.that are fauncninz� th in t rcskw •P3!rn n1) Cs.'J {;Ot174 I'i'I;✓ S �t ti:Ulitl (Source: PACENOW.org) On July 6, 2010, the Federal Housing Finance Agency (FHFA) released a statement urging state and local governments to put PACE programs on pause citing "unusual and difficult_ . . risk- management challenges for lenders, servicers and mortgage securities investors". The inspiration for this -statement has been -attributed to the concerns of government IkeResearch PACE Financing Consumer Survey mortgage -finance agencies Fannie Mae and Freddie Mac, who are regulated by the FHFA. -These agencies; -which guarantee more than half of. U.S. mortgages, took issue with the PACE loan's senior position to that of the mortgage. This dictates that in the event of default or foreclosure, the PACE loan would be repaid before a first mortgage, creating added risk for mortgage lenders like themselves. Since the FHFA's statement, a number of active PACE programs have gone dormant. However, efforts to revitalize PACE programs are gaining momentum. The state of California, the Natural Resources Defense Council, and a handful of communities which had PACE programs in place have filed lawsuits against the FHFA citing Fannie Mae and Freddie Mac's refusal to accept loans with PACE financing as illegal. Alternatives to PACE have also begun to take shape including the Federal Housing Authority's new program PowerSaver, which insures private lenders to offer loans of up to $25,000 for energy saving home improvements. Unlike PACE, a PowerSaver loan must be paid in full in .the . event of a transfer of ownership. In light of the roadblocks created by the FHFA, Fannie Mae and Freddie Mac, consumer .interest in such programs may seem less pertinent. However, recent developments in the campaign to reinstate PACE programs and President Obama's directive to enable energy efficiency measures makes consumer attitudes towards financing models like PACE highly relevant. This whitepaper examines the results of the Pike Research consumer survey related specifically to PACE financing programs. Within the nationally representative and • demographically balanced sample of 1,042 consumers, 669 were single family homeowners. This group of respondents was asked a series of questions dealing with attitudes and preferences toward the concept of PACE financing. 1.2 Key Findings 42% of single family homeowners were either "extremely" or "very" interested in PACE financing. This is significantly more than the quarter of single family homeowners who were either "not very" or "not at all" interested in the concept. Single family homeowners spending less ,than $200 per month on electricity showed significantly less interest in PACE programs than those spending more than $200. Within the group of respondents spending the least on electricity (less than $100), only 39% indicated interest in PACE versus 62% of those spending more than $200. • Solar panels and tankless water heaters were the most popular energy efficiency improvement options, each being chosen by 63% of PACE intenders. • The most popular reason for a lack of interest in a PACE financing program, by a wide margin, was the additional financial liability associated with the home improvement. • • e esearch PACE Financing Consumer Survey Section 2 PACE FINANCING PROGRAMS 2.1 Overall Interest in PACE Financing Programs Since PACE financing programs are only available to homeowners, questions regarding the concept were only asked to respondents owning single family homes. To introduce these respondents to the concept, the following description was provided: "Some local and state governments are considering a new financial tool called Property Assessed Clean Energy (PACE) financing. PACE programs provide low-cost financing to. homeowners to make energy efficiency improvements for their home including insulation, energy efficient heating and cooling, high -efficiency hot water heaters, and small renewable energy systems such as solar panels or small wind turbines. PACE programs require no upfront investment, and homeowners pay them back over 20 years via an annual assessment on their property tax bills. If you sell your home before the loan is repaid, it is transferred to the new homeowner." Based on this description, the survey asked respondents to provide their level of interest in this approach for financing energy efficiency and renewable energy home improvements. Chart 2.1 above shows that 42% of single family homeowners were either "extremely" or "very" interested in PACE financing. This is significantly more than the quarter of single family homeowners who were either "not very" or "not at all" interested in the concept. Chart 2.1 Interest in PACE Financing Program (Base: Single Family Home Owners) Not at all interested 11% Not very interested 14% Somewhat_ interested/ somewhat disinterested, 32% Extremely interested 16% Very interested 26% n=669 (Source: Pike Research) e esea rc PACE Financing Consumer Survey 2.2 Interest in PACE Financing by Demographic Segment In an .effort to reveal trends between interest in PACE financing and demographic traits, responses to this question were sorted based on the following respondent characteristics: • Education • Income • Gender • Age group Chart 2.2 below shows "extremely" or "very" interested responses based on this segmentation analysis. This analysis yielded few significant findings. Differences in education revealed inconsistent results and levels of interest were similar across income and gender segments. Across age groups, older homeowners tended to be Tess interested in PACE financing. However, this trend did not apply to the youngest age group (under 30) as they showed slightly Tess interest than .homeowners between the ages of 30 and 64. Chart 2.2 Interest in PACE Financing by Demographic Segment (Base: Single Family Home Owners) 0 cc a w 15 Extremely interested im Very interested TOTAL Less than high school High school graduate Techschool/some college 2 year college degree 4 year college degree Graduate school Less than $35K o $35K to $75K More than $75K a aa Female Male Under 30 30-44 45-64 65 or older 1 42% 5°l - i 36% 46% 47% 1 35% 42% 43% 55% 0% 10% 20% 30% 40% 50% 60% n=667 (Source: Pike Research) PikeResearch PACE Financing Consumer Survey 2.3 Interest in PACE Financing by Behavioral Segment In addition to demographic segmentation, percentages of "extremely" and "very" interested responses were calculated based on the respondents' monthly electric bill and inclination to adopt new technologies. As illustrated in Chart 2.3 .below, this breakdown of the respondent base provides some more distinct trends in PACE financing interest. There is a strong correlation between monthly spending on electricity and interest in a PACE program. Single family homeowners spending less than $200 per month on electricity showed significantly less interest in PACE programs than those spending more than $200. Within the group of respondents spending the least on electricity (less than $100), only 39% indicated interest in PACE versus 62% of those spending more than $200. This is an intuitive trend since PACE financing offers homeowners the opportunity to cut their electricity usage without a large upfront investment. The disparity • between- interest levels across this behavioral characteristic is.greater than other energy efficiency concepts covered in Pike Research's consumer survey such as demand response (DR) programs. This suggests that owners of high energy demanding homes are more drawn to energy efficiency measures that they can own, control and add to their home's value. This analysis also revealed that homeowners who identified themselves as early adopters of technology had significantly greater interest in PACE programs than the average homeowner. Over two-thirds (69%) of the "tech early adopter" segment expressed interest in the concept versus 43% interested among all homeowners. This behavioral segment is a strong target market for many energy efficiency -enabling concepts. Chart 2.3 Interest in PACE Financing by Behavioral Segment (Baser Single Family Home Owners) V — W 0 5 E Extremely interested Very interested TOTAL Less than $100 $100to $200 $200to $300 More than $300 Tech early adopters 0% 20% 40% 60% 80% n=669 (Source: Pike Research) ikeResearch PACE Financing Consumer Survey 2.4 Preferred Home Energy Efficiency, improvements Respondents who established an interest in PACE financing (PACE intenders) were then asked to identify specific energy saving home improvements that they would consider implementing if they participated in a PACE program. Respondents were able to select multiple energy efficiency improvements. As shown in Chart 2.4 below, solar panels and tankless water heaters were the most popular selections, each being chosen by 63% of PACE intenders. High efficiency air conditioners/evaporative coolers and insulation were close behind with each option selected by 58% of homeowners interested in PACE. Among the top six options chosen, four were higher efficiency appliances indicating that consumers view appliance replacement as one of the more effective methods to reduce energy consumption. The least 'chosen. options were high efficiency pool pumps and wood/pellet stoves, with 12% and 15% respectively. Notably, small wind turbines were selected by only 37% of PACE intenders suggesting that wind power still trails solar power in consumer preference by a significant margin. Chart 2.4 Preferred Home Energy Efficiency Improvements with PACE Financing (Base: Respondents Interested in PACE Programs — Multiple Responses Accepted) Tankless hot water heater Solar panels :ZdTW High efficiency air conditionerlevaporative cooler a Insulation Solar hot water heater High efficiencyfumace Storm windows Airsealing/duct sealing Insulating exterior doors Programmable thermostats Reflective roof shingles Small wind turbine Insulating shutters Wood/pellet stove=::ati 15% High efficiency pool pump x 12% Other 4% 0% 10% 20% 30% 40% 50% 60% 70% n=285 23% 51% 48% 48% "« 47% 46% 41% 40% 37% 63% 63% 58% 58% (Source: Pike Research) m e esea rc _y PACE Financing Consumer Survey 2.5 Reasons for Lack of Interest in PACE Financing Program Turning our attention to the homeowners who were not interested in PACE financing, Pike Research asked these respondents why the concept did appeal to them. Multiple responses were accepted for this question. Chart 2.5 below shows summarizes the results. The most popular reason for a lack of interest in a PACE financing program by a wide margin was the additional financial liability associated with the home improvement. A majority (56%) chose this option demonstrating an existing perception among many consumers that the cost of energy efficiency improvements is higher than the potential electricity cost savings. A lack of understanding how the PACE program would work was cited second most (30%) by homeowners uninterested in the concept. A slightly smaller percentage (19%) stated that their home was already very energy efficient. Few respondents cited • a 'lack of - interest in the improvements themselves — 9% were uninterested in renewable energy improvements and only 4% were uninterested in energy efficiency improvements. Chart 2.5 Reasons for Lack of Interest in PACE Financing Program (Base: Respondents Not Interested in PACE Program — Multiple Responses Accepted) I would not want to take on the additional financial liability I don't really understand how the PACE program would work My home is already very energy efficient Other I am not interested in renewable energy improvements such as solar panels or small wind turbines I am not the owner of my home I am not interested in making energy efficiency improvements to my home 19% • 4% 30% 56% 0% 10% 20% 30% 40% 50% 60% n=384 (Source: Pike Research) NkeResearch PACE Financing Consumer Survey Section 3 SUMMARY AND CONCLUSIONS While the future of PACE financing programs remains uncertain, the results of Pike Research's consumer survey indicate that interest in the concept is strong among consumers. These findings illustrate that a clear market opportunity exists for energy efficiency home improvement financing programs such as PACE. In the absence of PACE, this opportunity is likely to inspire similar programs that help overcome the financial barriers faced by homeowners seeking to make their homes more energy efficient. A solution to concerns about achieving a fair return on investment for energy efficiency upgrades remains a challenge for these programs. The PACE solution of tying the loan to the property and not the owner through tax assessments faces serious viability challenges since this is the element of the program that raised concerns at the FHFA. However, eliminating this aspect of PACE financing may result in a weaker level of consumer interest than the results of this survey indicate. Manufacturers of energy efficient appliances such as water heaters, air conditioners and furnaces are likely to benefit from financing programs such as PACE, according to the survey's results. A majority of PACE intenders stated that they would consider using PACE.funds to invest in tankless or solar hot water heaters; high efficiency air conditioners or evaporative coolers. A near majority (48%) indicated an interest in high efficiency furnaces. With such high levels of interest in using PACE programs to finance energy efficient appliances, suppliers of these products are prime candidates to support and participate in the creation of similar financing plans. Providers of residential solar systems also fall in this category given that 63% of PACE intenders would consider using the financing for a solar panel installation. Adoption of energy efficiency home improvements suffers due to the large capital investments required. This situation is worsened when poor economic conditions lead to an overall decrease in consumer spending. Of the single family homeowners who were not interested in PACE financing, 56% stated that they were unwilling to take on the additional financial liability that an energy -saving home improvement would require. While low cost financing programs like PACE help to alleviate these concerns, economic recovery is required before many consumers consider these types of investments. As the global economy slowly recovers and the appeal of energy efficiency improvements grow, availability of attractive financing will be a key component to the market's development. e e ch PACE Financing Consumer Survey Section 4 TABLE OF CONTENTS Section 1 1 Executive Summary 1 1.1 Introduction 1 1.2 Key Findings 2 Section 2 3 PACE Financing Programs 3 2.1 Overall Interest in PACE Financing Programs 3 2.2 Interest in PACE Financing by Demographic Segment 4 2.3 Interest in PACE'Financing by Behavioral Segment 5 2.4 Preferred Home Energy Efficiency Improvements 6 2.5 Reasons for Lack of Interest in PACE Financing Program 7 Section 3 8 Summary and Conclusions 8 Section 4 9 Table of Contents 9 Section 5 10 Table of Charts and Figures 10 Section 6 11 Scope of Study 11 Survey Methodology 11 0 eR�:) esewrch PACE Financing Consumer Survey Section 5 TABLE OF CHARTS AND FIGURES Chart 2.1 Interest in PACE Financing Program 3 Chart 2.2 Interest in PACE Financing by Demographic Segment 4 Chart 2.3 Interest in PACE Financing by Behavioral Segment 5 Chart 2.4 Preferred Home Energy Efficiency Improvements with PACE Financing 6 Chart 2.5 Reasons for Lack of Interest in PACE Financing Program 7 Figure 1.1 States with PACE -Enabled Legislation: March 2010 1 ' e esea rc PACE Financing Consumer Survey Section 6 SCOPE OF STUDY Pike Research has prepared this report to provide participants involved in the renewable energy and energy efficiency markets with a study of consumer demand for PACE financing and energy -saving home improvements. One of the major objectives of the report is to impartially assess levels of consumer interest in PACE financing, renewable energy and energy efficiency retrofits. Pike Research also provides an evaluation of key attitudes and behaviors that are relevant to this market. Great care was taken in constructing a survey questionnaire that would yield the most accurate and unbiased results possible. However, it should be noted that consumers often have difficulty providing survey responses that will accurately predict their purchase behavior for products that have not yet been introduced in the market. SURVEY METHODOLOGY Pike Research conducted a web -based survey of 1,042 U.S. consumers using a structured online questionnaire. The survey invitation was sent to a nationally -representative and demographically - balanced sample of consumers who are members of a large online panel. Respondents were offered a chance to win prizes in exchange for their participation. The margin of error for these survey results is +/- 3 percent with a 95 percent confidence interval. tireResewrc. - PACE Financing Consumer Survey Published 1Q 2011 ©2010 Pike Research LLC 1320 Pearl Street, Suite 300 Boulder, CO 80302 USA Tel: +1 303.997.7609 http://www.pikeresearch.com This publication is provided by Pike Research LLC ("Pike"). This publication may be used only as expressly permitted by license from Pike and may not otherwise be reproduced, recorded, photocopied, distributed, displayed, modified, extracted, accessed or used without the express written permission of Pike. Notwithstanding the foregoing, Pike makes no claim to any Government data and other data obtained from public sources found in this publication (whether or not the owners of such data are noted - in this publication). If you do not have a license from Pike covering this publication, please refrain from accessing or using -this -publication. Please contact Pike to obtain a license to this publication. ENERGY INDEPENDENCE 4 4ovz,4,1,A energy Upgrade" CAI IFOFZNIA October 17-18, 2011 Rod Dole Sonoma County Auditor -Controller -Treasurer -Tax Collector and Energy Independence Program Administrator (Retired) -vtgitmcliviov±,fi iwshieteo-Aizrivit:tr0'itzstetiv0v'AtVeZtllit. ws Pit*, 44•00=4Noci Program Updates - Operating for 29 months. Began operations on March 25,2009 - $51.5 Million growing •$1-1.5 M per month - $85 M Applications - 592 new jobs created - Over 1500 residential and 43 commercial properties improved - Recognized nationally — Congressional recognition - Created a technology tool library and industry workmanship standards - Working closely with property owners, leaders and media to resolve conflict - Huge support from the community, media and businesses - Resolving individual property refinance and sale problems Opportunity - Creating a "How to" manual for replication in other jurisdictions - Long term financing is proceeding - Creating a new "Energy Improvement Plan" culture for property owners $4,500,000 $4,000,000 $3,500,000 $3,000,000 $2,500,000 $2,000,000 $1 500,000 $1000,000 '$5Q0,000 Monthly Program Growth Net Bonded by.._Month _..._ ._ No \;"• ,CC ‘ `moo O 52 a; 2009-2010 2010-2011 `—' 2011-2012 yoK,,,,IFIF $5 $4 tn $3c 0 $ 2 $o Disbursements by Month •c\Q-' •62' 4 .)• .(c-• cc\ ,cc• \>E6 'QC (-429 C"'" 2009-2010 -R-2010-2011 ENERGY INDEPENDENCE ® Commercial interest in energy costs reduction • 592 job years created ® Local economic stimulation • Saving local resources Over 1400 tons of carbon reduction Property Values Increasn '4NSICIV* 44%* Commercial Retrofit Projects funded by SCEIP March 2009-March 2011 30 388% cn 25 15.7 20 a. "5 1 5 s— a) 10 Z 0 - co 10.4% 10.4% 7.5% • 3iyo 4.5% 3% 1 5% . ) %„ 0,(• ° 445 tcc, .C• •(• . 0 ..Ar zip $4.> 0 ° •). CP C.3k— ,(6 \C\ : : e • ,§ • • ,:ssk` .`. • ‹. +ZP 0 r_ E Commercial Project Type toiculture NtIrsIglitulttirt e.pr i; ET 2rimrk!,.iltaqr Success Factors • Collaboration to facilitate energy independence in the current building inventory • Five key facilitation components: upgrade- Must be the legal owner(s) of property • Must be current on mortgage(s) Must be current on property taxes Legal owner must not have had a bankruptcy (last three years) Payment is made to Property Owner, not Contractor There must be no involuntary liens on the property improvement cost must not exceed 10% of the market value of the property LTV 100% or less (Could be lower for your Program) Annual payment of property taxes AND assessment cannot exceed 5% of the market value of the property Title reflects assessment There is no acceleration of lien on foreclosures 10/11 Delinquent accounts: 3% - 1% 8 6 EIIIIIIIJI1III1ZIIIIITIrIIIZIIIZII 4 3 2 1 -.. i'1 • —1111.11. 1St Install FYE —40"-- Regular Prop Tax —Cl— PACE 09/10 % --6— PACE 10/11 % Foreclosures: None! A ("' i1es- PAC '..,AuUuFItv States 101 F 1.11)