A program meant to help Summit County residents get financing for energy efficiency improvements to their homes is “stalled” and unlikely to move forward.
California-based private lender Renovate America was the lending partner working with the Development Finance Authority of Summit County to finance the program.
Renovate America filed for bankruptcy protection after tighter regulations and lawsuits chased it out of the business of assessments for energy improvement financing, The Wall Street Journal reported in December 2020.
Bloomberg reported last April that Renovate America was facing more than 50 lawsuits when it declared bankruptcy, including a class action brought by homeowners in Los Angeles County, which ended its PACE program in May 2020, citing “increasing criticism and concern” over consumer protections.
“Residential PACE has met some — it has struggled to gain traction, I guess that's the safest way to put it,” said Brian Nelsen, chief of staff to Summit County Executive Ilene Shapiro. “There have been a number of consumer issues in other states that have made us — us being the administration at the county and others — become a little more uncomfortable with the whole residential PACE side of this and the way it's currently been delivered.”
Nelsen said that if there were a local partner for a future residential financing program, the county “would be more likely to move forward with it.”
“But at this point, it's stalled, and I'm not sure it's gonna actually get implemented here in Summit County,” he said.
How residential PACE was designed to operate
The program was meant to allow residents to apply for financing, either through Renovate America or local contractors, for projects like roofing, windows and doors, HVAC and furnace or insulation upgrades.
Property owners would have financed the upfront costs of energy improvements by making a voluntary assessment on their tax bill and paying back the costs over time. Renovate America said it would provide 100% financing using private dollars, with no taxpayer or ratepayer money used.
PACE financing has previously been used for commercial projects in the county, including the Cascade Plaza project in Akron, a Crystal Clinic facility in Bath Township and the Akron Rubber Development Laboratory in Barberton.
The Development Finance Authority of Summit County continues to offer PACE financing for businesses, nonprofits and governments to fund energy improvements, like lighting upgrades and roof and window replacements, financed through voluntary special assessments on properties.
Before using PACE, a community has to create or be part of an Energy Special Improvement District. DFA, in collaboration with Summit County, is the administrator of the Akron-Summit County ESID. The member communities are Akron, Barberton, Bath Township, Boston Heights, Copley Township, Coventry Township, Cuyahoga Falls, Fairlawn, Green, Hudson, Lakemore, Macedonia, Mogadore, New Franklin, Northfield Center Township, Norton, Richfield village, Springfield Township, Stow, Tallmadge and Twinsburg.
How commercial, residential approaches differ
Nelsen said there’s a key difference between the commercial program and a potential residential one.
“Most commercial entities that enter into this have finance and legal professionals that work for them. When you look at the residential side, particularly when you look at senior citizens, not so much the case,” he said.
“The number of times that there have been reports in other states of somebody signing up for something they don't still even with all the disclosures fully understand what they're signing up for, then the tax bill comes. They don't know what it is. Their children, caretakers, whoever are asking them why their tax bill went through the roof," Nelsen said.
"It's a problem. And it's one of those that I don't care how good the financial disclosures are, it can still happen, and it's still a tough situation,” he said.
“I think that's really, in a nutshell, the stumbling block that we haven’t been able to get over that hurdle to feel comfortable with pushing that program out.”
This article originally appeared on Akron Beacon Journal: Summit County home energy improvement program 'stalled'