LA County approves PACE financing to make solar and other energy-efficiency renovations affordable for homeowners. The program is expected to create 5,200 jobs in LA and save homeowners over $1 billion.
The Los Angeles County Board of Supervisors has voted in favor of residential Property Assessed Clean Energy (PACE) financing. The financing mechanism will be allowed for homeowners in cities within the county that have passed resolutions authorizing it. Forty-two LA County cities will launch the program this month.
PACE programs provide financing to make energy- and water-efficiency renovations affordable for homeowners by providing long-term, competitive financing through an assessment on their property tax bill — which means the interest is tax-deductible. Property owners are able to repay the loan over 5, 10, 15, or 20 years. This financing mechanism relies on a partnership with public agencies and is cost-neutral to participating jurisdictions.
After a partial hiatus, PACE programs have been coming back, in particular in California. HERO, a branded version of PACE, is the largest provider of residential PACE financing in both California and the nation. The HERO Program has been adopted by over 147 California cities, including Anaheim, Fresno, San Jose, San Diego, Santa Ana, and Riverside.
The programs are credited with bringing not only solar and other opportunities to homeowners but also economic benefits to the areas where they’re adopted.
“HERO has proved to be a highly effective tool for jurisdictions throughout California looking not only to encourage investments in water- and energy-efficiency, but also as an engine for creating high-quality local jobs,” said Los Angeles County Supervisor Don Knabe.
Cities under the purview of the San Gabriel Council of Governments and the South Bay Cities Council of Governments will begin offering PACE to residents in May, through the HERO program.
“After seeing HERO’s strong track record in other cities around the state, we are eager to get the program up and running for our residents,” said James C. Ledford Jr., Mayor of the City of Palmdale. “We anticipate this program will help us to create jobs and to support our efforts to meet mandated greenhouse gas reduction goals.”
As HERO expands in California, evidence is growing that it is generating meaningful economic activity. The program is expected to create 5,200 jobs in LA and save homeowners over $1 billion.
“HERO is gaining momentum throughout California, and we’re seeing that it is making a big impact in terms of job creation and economic stimulus,” said Renovate America CEO JP McNeill. Renovate America provides funding and administers HERO for participating jurisdictions. “HERO has a strong track record where it is already active, and we’re excited to be providing the program in Los Angeles County.”
PACE can come with more than one option. A growing number of California jurisdictions are partnering with multiple PACE providers to increase the financing choices available to consumers.
HERO has been financing residential projects in California since 2011. It is the largest PACE program in California, financing 95% of all residential PACE projects in the state with a total of $200 million financed to date.
The state’s home improvement industry has seen a significant boost in activity directly related to the program. Solar is among the most popular upgrades, which also include HVAC systems, energy-saving windows, doors, roofing, and insulation.
“This program will help our communities save energy and water, create local jobs, and enjoy immediate improvements in our homes,” said Dan Medina, South Bay Cities Council of Government Chairman and Gardena City Councilman. “It’s one of those rare win-win-win programs; we’re excited to get started with HERO.”
All jurisdictions in California can now offer the HERO program in their communities simply by adopting a resolution through the city council or board of supervisors. There are no costs to the city or county; HERO provides all funding and administration of the program.