Supervisors in Tulare County, California, voted this week to give residents access to Renovate America’s HERO Property Assessed Clean Energy (PACE) financing for home energy and efficiency improvements. The vote was the latest in a string of local legislative victories for both HERO and PACE, and showed momentum for the innovative financing mechanism growing in California and beyond.
“We’re excited that the Tulare County Board of Supervisors voted to make HERO financing available to their citizens and local contractors,” said Blair McNeill, Vice President of Market Development at Renovate America. “With HERO, a broad range of homeowners in Tulare County will now be able to access energy-saving home improvements, while benefiting from consumer safeguards that go well beyond those found with other types of home-improvement financing.”
HERO, the largest form of PACE financing in the United States, empowers homeowners to make energy efficiency, water saving and renewable energy home improvements and to pay for them at a fixed interest rate over time through an additional line item on their property taxes. In Florida, HERO can also be used to finance wind-resistant improvements to make homes more resilient in the face of hurricanes and tropical storms. HERO financing payments may have tax benefits, and many property owners who use HERO to finance home improvements see immediate savings on their utility bills.
The vote by Tulare County supervisors to allow HERO to be offered in unincorporated portions of that county came as supervisors in neighboring Kern County voted 4-0 to give HERO a six-month extension to operate there. It also came a day after commissioners in Collier County, Florida, gave final approval to HERO in that county’s unincorporated region, which followed similar moves earlier this year by commissioners in Hillsborough and Pasco counties – also in Florida – and supervisors in California’s Amador and Glenn counties. Last month, city councilmembers in Santa Rosa, California, voted to give their residents access to HERO, as did the city of Columbia, Missouri.
PACE financing has also been gaining momentum nationwide. In May, Colorado Gov. John Hickenlooper signed legislation that moved his state a step closer to being able to offer residential PACE financing, and several other states are seriously considering PACE legislation. Also earlier this year, the city councils of Cupertino, Sunnyvale and Santa Barbara, California, voted to give their residents access to PACE financing.
PACE has bipartisan appeal – and is also supported by groups as varied as the National Association of Manufacturers and the Natural Resources Defense Council – because it offers a free-market approach to advancing public-policy objectives. PACE effectively expands access to credit to help property owners improve or repair their properties with efficient products, while creating and sustaining local jobs at no cost to public budgets.
Interest rates as low as 2.99% and industry-leading consumer safeguards serve to set HERO apart from other residential PACE programs. HERO’s Contractor Quality Rating system helps ensure homeowners are working with contractors who have good performance records – as well as being licensed, bonded, or insured – a service not offered by other payment options. To help homeowners easily understand their financing terms before they finalize their contracts, all residential PACE providers in California must provide homeowners with written disclosures modeled on the federal “Know-Before-You-Owe” forms for mortgage lending. HERO also requires a live phone call with a HERO representative to confirm understanding of not just financing terms and household budget implications, but also that utility savings may not meet expectations set by the contractor. In addition, HERO contractors must have an active license and be in good standing with relevant state licensing boards – as well as maintain insurance and an ability to meet bonding requirements. If there are homeowner complaints, PACE providers proactively work with contractors to resolve them.
About Renovate America
Renovate America offers a tech-enabled financing platform for home improvement and commercial retrofits that empowers communities to modernize and make their housing stock more efficient, while giving small businesses the tools they need to grow. In addition to financing home improvements through an unsecured lending product, Benji, Renovate America offers communities HERO financing. HERO is the leading residential Property Assessed Clean Energy (PACE) program in the U.S. and has been used by over 100,000 homes to make energy and efficiency improvements. It is estimated that HERO is on track to save billions of dollars in energy and water bills, and has created over 20,000 local trade jobs that cannot be offshored or automated. Renovate America has built the world’s largest green bond platform, with a volume of originations that enables securitization of HERO PACE bonds multiple times a year, attracting international investment to meet U.S. clean-energy objectives.