Property Assessed Clean Energy (PACE) Financing Available to Rochester Hills Businesses
Rochester Hills created a PACE district in partnership with Lean and Green Michigan on June 24, 2013. PACE financing is an innovative tool that promotes renewable energy and energy efficiency projects for commercial, office, industrial, and multi-family properties. Rochester Hills created the district and Lean & Green Michigan administers the PACE program.
Here’s how the program works in Rochester Hills:
- A business seeking to do an energy efficiency or renewable energy project connects with the City and Lean & Green.
- Lean & Green works with the property owner through the application process to ensure that the project meets the requirements for PACE financing, most notably that the project will generate a positive cash flow to the property owner.
- Lean & Green provides the property owner access to a marketplace of private sector financers who are looking to provide PACE funding.
- Once the program requirements are met, the property owner enters into a special assessment agreement with the City for repayment of the PACE loan. The funds are disbursed and the project is completed. The loan is repaid as part of the bi-annual property tax bill unless the property owner enters into a direct repayment agreement with the lender.
- The contractor guarantees the energy savings on all projects over $250,000 in value.
- The positive cash flow requirement means that the property owner will be saving money from day 1.
The City of Rochester Hills does not directly loan money to property owners, and this is not a tax abatement. Rather, it is a way for the City to leverage an innovative private-sector market based approach to saving energy and saving our businesses money. The fact that repayment of PACE loans are tied to special assessments against the property allows lenders to offer longer loan repayment terms than the typical 3-5 year business loan, which can be the difference in making renewable and energy efficiency projects cash-flow positive from day 1.
For more information on the PACE program you can visit www.leanandgreenmi.com; you can contact Rochester Hills Economic Development Manager Pam Valentik at 248.841.2577 or firstname.lastname@example.org, or the Planning Manager at 248.841.2572 or email@example.com; or you can fill out this online form and click submit and Pam will contact you with more information.
What is PACE
Who is on the PACE Team?
PACE FAQ for Local Governments
How a PACE Project Actually Happens
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