Typical Type of Letter
Re: Support for adopting PACE (Property Assessed Clean Energy) in Houston
Thank for your service to the City of Houston in your role as Councilmember. Your responsibilities are both numerous and significant discerning among the many issues that come before you for consideration.
I am writing you in support of the City of Houston adopting the PACE program as made available by Texas House Bill 3187 which will allow commercial property owners in Houston to gain access to a powerful financing tool already in use by many cities and counties across 29 states. Several local governments in Texas are considering making PACE available in their areas with two having already done so, Travis County (Austin) and Willacy County in the Lower Rio Grande Valley.
We also encourage you to name the nonprofit, Texas PACE Authority as “the Administrator” for your program. An outside Administrator can streamline the application process, determine if projects comply with the legal requirements of the PACE statute, and ensure the filing of the assessment with the local taxing authority. Having a single Administrator for all programs throughout the state will provide a professional and consistent platform.
Without using any public money, PACE allows a property owner the opportunity to obtain long term fixed rate 100% financing to make improvements to increase their property’s energy efficiency, water conservation, renewable energy and most importantly lower their operational cost resulting in an immediate increase in their cash flow. PACE provides access to increased energy efficiency, improved quality of the local commercial building stock, increased property valuations and economic development by increasing the number of jobs in our city.
PACE is the most significant new development I have seen in my 35 year real estate career. It is a real game changer for a city, helping local property owners, engineers, contractors, lenders truly providing a win-win-win-win situation.
It is a powerful financing tool because:
1) It allows the property owner to repay the loan via an additional line item added to their property’s annual tax bill
2) It connects the financing of the improvement to the actual property vs to the owner thus allowing the financing tenor to match the useful life of the improvement
3) Provides financing that will be fixed rate and cannot be accelerated by the lenders
4) With 100%, long term financing it frees up an owner’s cash for other uses
5) It enables a property owner to do all construction projects that improve energy efficiency together now, receiving the benefits of lower utility bills immediately while paying back the funds over a much longer time period typically 20 years. I personally experienced the economic limitations while redeveloping the Esperson Buildings. We had numerous projects we had to delay and spread out over many years because we could only justify spending so much money each year. Had PACE been available back then we would have gladly used it to accomplish so much more.
6) It provides better security to the lender by directing the loan repayment through the property tax assessment.
By increasing the number of energy and water conservation projects being completed in the private sector within the city, PACE also extends the useful life of existing power generation and public water resources.
PACE will further enhance Houston’s image as not only the energy production capital of the world but also the energy conservation capital of the world.
It improves the quality of our local inventory of commercial real estate and thus the long term tax valuation for the city thereby ensuring that during the next economic downturn Houston’s buildings will be less susceptible to the problems of urban blight that have afflicted other cities and not only hurting tax valuations but all the people in our city.
This is an opportunity that reaches across the political aisle benefiting: big property owners, small tenants, business owners, environmentalists and business, energy providers and users as well as the City itself.
PACE Houston is an independent private company that will work within the City of Houston and the Texas PACE Authority’s guidelines to provide strategic advice to property owners and assist them in developing their PACE Project.
Pace Houston and C-C Development, Inc
100% Financing for Energy Improvements