Implementing entities authorized to issue bonds
'''''Note: The Federal Housing Financing Agency (FHFA) issued a [http://www.fhfa.gov/webfiles/15884/PACESTMT7610.pdf statement] in July 2010 concerning the senior lien status associated with most PACE programs. In response to the FHFA statement, most local PACE programs have been suspended until further clarification is provided. '''''
Property-Assessed Clean Energy (PACE) financing effectively allows property owners to borrow money to pay for energy improvements. The amount borrowed is typically repaid via a special assessment on the property over a period of years. Missouri has authorized certain local governments to establish such programs, as described below. (Not all local jurisdictions in Missouri offer PACE financing. Contact your local government to find out if it has established a PACE financing program.)
In July 2010 the Missouri legislature enacted the "Property Assessed Clean Energy Act." The act allows municipalities (county, city, or incorporated town or village) to create Clean Energy Development Boards, which in turn are permitted to develop local PACE programs to finance energy efficiency improvements or renewable energy improvements. A clean energy development board may be created by an individual municipality or by multiple municipalities working together. In January 2011, [http://dsireusa.org/incentives/incentive.cfm?Incentive_Code=MO112F&re=1&... Jefferson City] became the first city in Missouri to adopt the PACE ordinance. The enabling legislation also permits the Missouri Environmental Improvement and Energy Resources Authority (EIERA), the financing arm of the Missouri Department of Natural Resources (DNR), to develop administrative rules to implement and guide local programs. Cole County adopted a [http://www.dsireusa.org/documents/Incentives/ColeCounty02_28_2011Minutes... similar PACE ordinance] in February 2011.
The law is in general very broad and permissive in terms of how local governments may define their programs. Many details of local programs are left up to local governments, or perhaps will be addressed in EIERA regulations. Notably, local governments may develop programs that support both energy efficiency and renewable energy improvements, both of which are likewise defined very broadly. Energy efficiency improvements include but are not limited to HVAC measures, building and equipment insulation, energy recovery systems, energy controls, caulking and weatherstripping, efficient lighting, daylighting, and certain windows and doors. Renewable energy improvements include but are not limited to solar photovoltaics (PV), solar thermal, wind, biomass, and geothermal energy systems.
Improvements must have a positive economic benefit over the term of the financing contract and contracts are limited to 20 years in length. Programs may offer PACE financing support for eligible improvements on any privately- or publicly-owned property. In order to participate in a program, property owners will enter into a special assessment contract with a clean energy development board where the property owner agrees to pay a special assessment in exchange for financing of a qualified improvement. The special assessment constitutes a lien on the property in question and will be collected in the same manner and with the same priority as ad valorem property taxes.
Clean energy development boards are invested with a variety of powers. As follows the general PACE model, the board is permitted to enter into assessment contracts with property owners and levy and collect special assessments under an assessment contract. A clean energy development board is also permitted to issue bonds or borrow money from any other private or public source. A board may also specify application and qualification criteria necessary to administer a program, including minimum energy efficiency standards, energy audits, and post-installation verification requirements.