The state legislature passed urgency measure AB 811 in July 2008 which authorized county, regional and statewide agencies to develop large-scale sustainable energy financing programs. The idea is to spread the overhead and financing costs over a much larger market area, making the retrofit work more feasible. Alameda County was one of 14 counties to adopt the measure and all cities in the county are eligible to participate. Under the program, Pleasanton property owners, including businesses that own their own buildings, can borrow money from the program to install energy efficient improvements, such as lighting efficiency retrofits, heating and air conditioning system efficiency improvements, solar photovoltaic electrical systems and possibly weatherization and insulation improvements. Those who participate can have the cost of those improvements financed through "contractual assessments" on their property for up to 20 years in order to repay the loans.
The city of Pleasanton has a wealth of experience with assessment-type financings such as these, including financing a majority of the public infrastructure that supported the development of Stoneridge Mall, Hacienda Business Park and other business parks in the city. The benefit of the CaliforniaFIRST program for a property owner is that only those who choose to participate in the program will have assessments imposed on their property. In today's economic environment, there may be few attractive options for property owners to finance renewable energy, energy efficient, and water efficient improvements. Even if financing can be obtained, most commercial loans must be paid in full if the homeowner sells the property. Under this new program, the life of the repayment option -- or assessment -- transfers with the property upon sale. The property owner can choose to pay off the assessment at any time.
Operations Director Smith said the CaliforniaFIRST program has an added advantage in that it not only provides incentives for homeowners to move forward on making their homes more energy efficient, but it also offers opportunities for the construction industry, where the unemployment rate in California now hovers above the 22 percent mark. In fact, the state legislature eyed the possibility of greater numbers of construction jobs when it voted to create CaliforniaFIRST. All of the costs of setting up the program and promoting it will be paid by stimulus funds from Alameda County so that there is no cost to the city of Pleasanton or to homeowners to sign up for the program. There's currently a 7 percent interest rate on the tax assessment financing and it's unclear at this time if the added assessment will be considered an added value to the property itself and thus be tax deductible. Still, it's a far less expensive way of financing major expenditures for the home to make it more efficient with the added benefit of reduced utility bills once the solar roof or other energy saving devices and materials are installed. Smith told the council that this is a "win-win" program for residents, the city and the construction trade. We agree.