Memorandum

City of Lawrence

City Manager’s Office

TO:	Toni Wheeler, City Attorney
CC:	Diane Stoddard, Interim City Manager
FROM:	Eileen Horn, Sustainability Coordinator
DATE:	October 30, 2015
RE:	2016 Legislative Priorities Statement, PACE energy efficiency programs

Background

In the fall of 2014, the City of Lawrence Sustainability Advisory Board identified Property Assessed Clean Energy Programs as an innovative new tool to support energy efficiency retrofits in our community.  Property Assessed Clean Energy (PACE) programs support energy efficiency improvements to residential and commercial properties – reducing citizens’ energy bills and helping the City achieve our climate change mitigation goals.

PACE is a financing tool that presents property owners an opportunity to borrow money, with little to no upfront cost to install renewable energy and energy efficiency conservation measures (i.e. heating and cooling systems, lighting retrofits, solar panels, etc). PACE creates Energy Efficiency and Renewable Energy assessments that are tied to the property and repaid through the home or business owner’s property taxes. This setup assures the funding body that their upfront investment will be recovered through monthly property tax payments of the owner. When implemented properly, PACE results in a net positive cash flow for property owners, is tax neutral with no exposure to a city’s general fund, and promotes local job growth.

24 states have adopted PACE-enabling legislation, including neighboring states of Colorado, Missouri, and Arkansas.  This legislation enables local governments in these states to establish PACE programs and impose an assessment on the property to repay the energy efficiency project costs.

Kansas State Representative Boog Highberger introduced PACE-enabling legislation for Kansas at the end of the 2015 session, but the bill didn’t advance out of committee.  HB 2350, can be found here:  http://www.kslegislature.org/li/b2015_16/measures/documents/hb2350_00_0000.pdf

Recommendation

The Sustainability Advisory Board recommends that support of PACE-enabling legislation be included in the City Commission’s Legislative Priority Statement for 2016.  SAB believes that a PACE program in the City of Lawrence could provide reduced energy bills for citizens while helping the City achieve our greenhouse gas reduction goals.