Loading...
HomeMy WebLinkAbout05/30/2017 B A K E R S F I E L D Staff: Committee members: Chris Huot, Assistant City Manager Andrae Gonzales, Chair Willie Rivera Ken Weir CORRECTION SPECIAL MEETING OF THE BUDGET AND FINANCE COMMITTEE of the City Council - City of Bakersfield Tuesday, May 30, 2017 10:30 a.m. City Hall South 1501 Truxtun Avenue, Bakersfield, CA 93301 City Council Chambers AGENDA 1. ROLL CALL 2. ADOPT APRIL 27, 2017 AGENDA SUMMARY REPORT 3. PUBLIC STATEMENTS 4. NEW BUSINESS A. Discussion and Committee Recommendation Regarding the PACE Program – Tandy 5. COMMITTEE COMMENTS 6. ADJOURNMENT   B A K E R S F I E L D Committee Members Staff: Chris Huot Councilmember, Andrae Gonzales, Chair Assistant City Manager Councilmember, Willie Rivera Councilmember, Ken Weir SPECIAL MEETING OF THE BUDGET AND FINANCE COMMITTEE Thursday, April 27, 2017 12:00 p.m. City Hall North – Conference Room A 1600 Truxtun Avenue, Bakersfield, CA 93301 The meeting was called to order at 12:00 p.m. 1. ROLL CALL Committee members Present: Councilmember, Andrae Gonzales, Chair Councilmember, Ken Weir Committee members Absent: Councilmember, Willie Riviera City Staff Present: Alan Tandy, City Manager Chris Huot Assistant City Manager Caleb Blaschke, Management Assistant – City Manager’s Office Joshua Rudnick, Deputy City Attorney Nelson Smith, Finance Director Randy McKeegan, Finance Supervisor Additional Attendees Present: Eric Xin, Brown Armstrong Melissa Cabezzas, Brown Armstrong Bryan Gruber, LSL CPA 2. ADOPT MARCH 2, 2017 AGENDA SUMMARY REPORT The Report was adopted as submitted. 3. PUBLIC STATEMENTS There were no public statements. /s/ Chris Huot ____________________________________________ Budget and Finance Committee Meeting Agenda Summary Report - April 27, 2017 Page 2 4.NEW BUSINESS A. Discussion and Committee Recommendation Regarding Auditor Selections Process – Smith Finance Director Smith provided a summarization of the policies for audit reporting practices and selection of an audit services firm memorandum included in the packet. A Request for Proposal (RFP) for auditing services for the annual audit work for Fiscal Year 2016-17 with the option of up to four one year extensions was posted in March 2017, which resulted in 14 firms showing interest, two of which submitted proposals. Mr. Smith provided the following summarization of the two firms: Audit Firm Lance Soil & Lunghard Brown Armstrong Full scope all-inclusive price $58,710 $55,800 Total Staff Hours 610 632 Office Location Brea, Ca Bakersfield, Ca Mr. Bryon Grubert representing Lance Soil & Lunghard CPAs (LSL) provided a verbal synopsis of LSL experience in the auditing of government entities. Mr. Eric Xin representing Brown Armstrong Accountancy Corporation also provided a verbal synopsis of Brown Armstrong’s experience in the auditing of government entities. Ms. Melissa Cabezzas representing Brown Armstrong Accountably Corporation added that their firm has a local office in Bakersfield making them easily accessible. Committee member Weir asked the firms what other cities, those which are comparable in size to the City of Bakersfield, if any, they conduct audits for. He also asked how long Brown Armstrong has served as the City’s auditing firm. Mr. Grubert stated his firm currently audits approximately 60-65 government entities in California including Santa Monica, Pasadena, Shafter, and California City. Mr. Xin stated that his firm audits several cities in the central valley area including but not limited to Fresno, Tulare, and Modesto. Finance Director Smith stated Brown Armstrong has been the City’s auditing firm for approximately 24 years out of the last 26 years; there was a different firm from Visalia in place from July of 2005 to June 2007. When that firm declined to continue doing governmental auditing, the City had to select a new firm. Committee member Weir asked if there were any staff concerns having the same auditing firm in place for so many years. City Manager Tandy stated that although the same auditing firm has been place auditing the City’s financials, the firm assigns a new group of personnel to conduct the audits every 5 years, therefore complying with state law and providing a fresh review of the financials. This provides transparency and ensures a fresh pair of eyes to provide new perspectives regarding the City’s financials. ____________________________________________ Budget and Finance Committee Meeting Agenda Summary Report - April 27, 2017 Page 3 Committee member Weir made a motion to recommend the selection of Brown Armstrong Accountancy Corporation to perform the annual audit work for Fiscal Year 2016-17 with the option of up to four one year extensions to the full City Council for approval. The motion was unanimously approved. Committee Chair Gonzales and Committee Member Weir thanked those representing the auditing firms for the attendance. 5.COMMITTEE COMMENTS There were no Committee comments. 6.ADJOURNMENT The meeting adjourned at 12:22 p.m. ADMINISTRATIVE REPORT DRAFT Budget and Finance Committee ~ May 30, 2017 Administrative Report – Page 1 TO: Budget and Finance Committee APPROVED FROM: Alan Tandy, City Manager CITY ATTORNEY ______________ DATE: May 30, 2017 CITY MANAGER ______________ SUBJECT: Property Assessed Clean Energy (PACE) Programs RECOMMENDATION: City staff has concerns that City participation in Property Assessed Clean Energy (PACE) programs has apparently resulted in unfortunate and unintended outcomes. However, more information is needed prior to a City staff recommendation on this issue. Therefore, City staff seeks the direction of the Committee. BACKGROUND: In 2008, the State of California approved legislation that enables counties and cities to allow PACE programs to provide a mechanism for property owners to fund energy efficiency, water efficiency, and other renewable energy projects. The legislation authorized the creation of assessments districts, whereby commercial and residential property owners could finance the capital costs of these projects and repay the amount financed through an assessment on their property. The assessment is recorded as a lien (in most cases a priority lien) against a property, entered into the County roll, and collected through the property owner’s tax bill as a traditional property assessment. The assessment to repay the project loan amount, plus any application fees and interest, runs with the property until the expiration of the repayment term. In response to State law, some cities and counties began to create, administer, and fund local PACE programs. Concurrently, several statewide PACE programs were developed to provide cities a turnkey PACE option that did not place an administrative burden or financial liability on the cities that participated in them. Since 2010, the City has entered into contracts with five PACE program providers to allow them to operate in Bakersfield, including: PACE Program Provider Contract Executed CaliforniaFIRST March 24, 2010 Figtree April 17, 2013 HERO August 13, 2014 Ygrene Works and Energy Efficient Equity (E3) September 16, 2015 MEETING DATE: AGENDA SECTION: ITEM: Budget and Finance Committee ~ May 30, 2017 Administrative Report – Page 2 A considerable number of projects have been funded and completed. According to data provided by the PACE program providers, it is our understanding that 2,706 projects have been completed in Bakersfield since 2014. Interestingly, only 1,174 projects have funded solar photovoltaic systems and 105 for water efficiency improvements. The balance has included HVAC, lighting, water heaters, windows doors, building envelopes, and other improvements (Attachment B). While those projects are allowed under the PACE program, please note that energy and water efficiency projects were the driving force behind the City’s approval of the said program. Recently, the Association of Realtors has requested City Council consideration to discontinue PACE programs due to various concerns (Attachment C). Conversely, PACE program providers have provided counter arguments and comments (Attachment D). Ultimately, this matter was referred to the Budget and Finance Committee by Councilmember Gonzales on February 15, 2017. City staff and several Councilmembers have since been briefed by the Association of Realtors and representatives of the PACE programs. Both groups represent significant business interests and can present material effectively. Both have lobbied, paid for advertising, and other activities. Based on reviewing various materials and hearing arguments from both sides, City staff believes the most compelling issues include:  Communication was received from Kern County Assessor-Recorder Jon Lifquist regarding participation in PACE programs (Attachment A). City staff believes Mr. Lifquist views are objective, on point, and relay a perspective from a neutral party who is in communication with the impacted property owners.  The Association of Realtors (founded in Bakersfield in 1905) represents an integral part of the local economy. They have, in the vast majority of instances, supported the City and its activities. It should be assumed this issue is significant to the real estate industry in the local economy.  Some evidence has been submitted of undesirable outcomes from PACE projects, including instances where residents did not know a bill was going on their taxes; extremely out of market pricing for improvements; disruptions to real estate transactions; out of market interest costs; and other adverse impacts. While such things can occur in a free market economy, the City’s authorization for PACE programs to exist allows such costs to be placed on the property tax bill. It appears the inclusion of the costs on the property tax bill has been a source of concern.  While the State Legislature has recently improved some of the disclosure requirements and others reform measures are under consideration in the Legislature and Congress, the undesirable outcomes should have never occurred. Also, neither the City nor the State monitors the transactions; therefore, there is no mechanism to limit the reoccurrence of the adverse impacts. However, there is a bill within a Congressional Committee that extends customary federal consumer protective laws to PACE programs (Attachment E). If passed, there is a reasonable chance the law would alleviate some concerns, but the outcome is unknown at this moment.  When PACE programs were authorized, the motivation was alternate energy supplies and water efficiency improvements. Backing in through “energy efficiency,” PACE programs have funded standard roof and air conditioning repairs, doors, windows, and other improvements. It was not the intention of the City that standard home repairs Budget and Finance Committee ~ May 30, 2017 Administrative Report – Page 3 would be placed on property tax bills. The high interest rates of PACE programs make the repairs cost more than alternatives available in the general economy. Please note that these types of homeowner repairs have historically taken place prior to the PACE programs; they will still continue if PACE programs go away.  At the request of the Association of Realtors and the largest PACE provider, a meeting with City staff was held to see if a compromise could be reached between the parties. After lengthy discussions, it was clear the primary problems, in the view of Association of Realtors, are allowed under State law (e.g., priority lien status of the PACE assessments via property taxes). As a result, it does not appear a compromise on these specific issues is possible without amending State law.  PACE programs are inessential to the completion of energy or water efficiency projects. As previously discussed, they report completion of 1,174 solar photovoltaic systems and 105 water efficiency improvements since 2014. According to City records, an average of 3,717 homes have installed solar photovoltaic systems annually over the last four years. Clearly, there are alternatives to install solar photovoltaic systems without the costs going on the tax rolls.  If the City Council terminates the contracts with the PACE program providers, it only impacts future parties and not those who have had projects completed. RECENT DEVELOPMENTS: The City requested the Association of Realtors to provide full details on complaints that they have received. A document from them was received just as this report was being finalized. It has not yet been fully reviewed by City staff (Attachment F). We have been advised that if the legitimacy of any of the complaints are questioned the names will be provided to City staff for verification purposes. City staff has reviewed some level of information on both State and Federal PACE legislative reform efforts. Also, City staff has received a draft “Participation Agreement” by representatives of the PACE programs as an effort of local reform (Attachment G). Nonetheless, there is no practical mechanism for the City to monitor or check the terms of a Participant Agreement. Whether any of these reform efforts alleviate concerns is unknown at this time. ALTERNATIVES: Possible alternatives for Committee consideration include: A. Recommend the full City Council continue with the PACE programs (status quo). B. Continue with the PACE programs for a set period of time (e.g. 90 to 180 days) to identify if State and/or Federal reforms remedy said concerns. C. Recommend termination of the five PACE programs to the full City Council. D. Send the issue to the full City Council without a Committee recommendation. E. Meet again as a Committee on this issue when more information is assembled. Budget and Finance Committee ~ May 30, 2017 Administrative Report – Page 4 ATTACHMENTS: A. Communication received from Kern County Assessor-Recorder Jon Lifquist B. Projects funded by PACE programs in Bakersfield C. Association of Realtors correspondence D. PACE program provider correspondence E. Pending legislation F. List of complaints G. Participation Agreement Attachment A From:JONATHON LIFQUIST <lifquist@co.kern.ca.us> Sent:Thursday, May 18, 2017 11:36 AM To:AdmMgr Subject:PACE/HERO Participation Mr. Tandy, The Kern County Board of Supervisors is currently reviewing the county's involvement, via property tax assessments in the PACE program, and I have been invited to a few discussions or debates on the issue. Though the county takes the lead role in collecting the PACE assessments, the city of Bakersfield is the largest participant with the highest number of assessments. Though I'm sure you've heard plenty from both sides of the issue, I was asked by one of the participants to forward my opinion about the program. I hope you can find the time to read: While only peripherally involved in the issue of PACE improvements and finance, the Assessor’s Office daily answers a large number of tax bill related questions. Among the most frequent questions we get is: “Why did my tax bill or mortgage payment increase?” The answer is sometimes due to a PACE/HERO assessment added to the yearly property tax bill, an assessment that may double, triple or quadruple the amount due each year. Though these assessments are voluntary, these large increases are an eye opener in a state which passed Proposition 13 largely to eliminate the rapid escalation of property tax bills. From all appearance, the majority of PACE improvements are completed in a competent manner by honest contractors who represent the program with clear and candid disclosure. Unfortunately, this is not always the case, and it is possible to find cases where homeowners have been significantly overcharged. There are also many stories of homeowners who believe that the specifics of the loan, tax lien or fees were misrepresented to them. In the class action suit Loya v. Western Riverside Council of Governments the lawyers for the defense argue that the PACE program is not subject to government oversight in the form of the Truth in Lending Act or The Home Ownership Protection Act. The lawyers also argue that since PACE lenders are not required to determine the borrower's ability to repay, the Consumer Finance Protection Bureau has no say in the process. In short, WRCG lawyers argue that the normal consumer protections for home or consumer loans do not exist for PACE loans. Whether or not this is right, this is true in practice. PACE lenders do not conform to typical loan regulation, but the loans are backed by the government, our local government in the form of property tax liens. This laissez-faire freedom from government control combined with government enforcement on collections seems an awkward mix. The reasoning behind the property tax liens is that PACE improvements are a public good, that energy and water conservation efforts are "necessary to address the issue of global climate change." This might be true, but is incentivizing a program without standard consumer protections through government enforcement of the lien really a public good? Many aspects of the program are laudable, a benefit to some local homeowners and boon local contractors, but if the program is to be backed by local government, shouldn’t local government insist on safeguards and oversight? One major problem with the program is the high rate on the loan itself. The tax lien makes this one of the safest instruments in the world of loans, yet the typical Kern County PACE loan yields over 8% interest for the lender, and high fees, capitalized over the life of the loan, bring the average APR to almost 10% and many are substantially higher (though PACE lenders disclose lower APR’s using non-standard methodology.) Otherwise unqualified borrowers might see this as a reasonable alternative to a consumer credit loan, but PACE lenders are earning consumer credit rates on secured loans, aided and abetted by the County of Kern and other local governments. Maybe the potential downside has been overplayed, foreclosures and tax defaults will never materialize and property owners arguing that they were defrauded will be discredited. But the possibility that problems will persist and possibly get far worse is something that decision makers should consider when deciding whether or not continued participation in the program is truly a public good. Jon Lifquist Kern County Assessor-Recorder lifquist@co.kern.ca.us http://assessor.co.kern.ca.us/ (661) 868-3311 Attachment B SUMMARY of ALL PACE STATS BAKERSFIELD  Year: # of Applications Received: # of Applications Approved: # of Applications Funded: Total Funded Value:  2014 433 196 32 $597,347 2015 3110 1981 897 $18,805,012 2016 3568 2240 1459 $29,997,787 2017 973 612 318 $6,881,985 Total: 8084 5029 2706 $56,282,131 2014 (31)$377,374 2014 (0)$0 2015 (345)$3,807,660 2015 (0)$0 2016 (383)$4,925,566 2016 (3)$77,017 2017 (68)$936,012 2017 (0)$0 Total: (827)$10,046,612 Total: (3)$77,017 2014 (0)$0 2014 (0)$0 2015 (14)$59,646 2015 (0)$0 2016 (10)$59,823 2016 (9)$179,201 2017 (3)$24,696 2017 (1)$15,216 Total: (27) $144,165 Total: (10)$194,417 2014 (7)$101,185 2015 (205)$2,290,554 2014 2016 (189)$2,668,443 2015 2017 (54)$723,087 2016 Total: (455)$5,783,269 2017 (2)$190,214 Total: (2)$190,214 2014 (0)$0 2015 (1915)$2,501,431 2016 (1942)$4,586,876 2014 (0)$0 2017 (484)$812,439 2015 (30)$356,269 Total: (4341)$7,900,746 2016 (60)$955,109 2017 (15)$518,729 Total: (105)$1,830,107 2014 (0)$0 2015 (64)$47,047 2016 (6)$181,847 2017 (38)$172,723 Total: (108)$401,617 2014 (0)$0 2015 (10)$24,568 2016 (7)$15,106 2017 (0)$0 Total: (17)$39,674 2014 (1)$44,250 2015 (340)$7,428,789 2016 (666)$12,951,547 2017 (167)$3,058,289 Total: (1174)$23,482,875 High Efficiency Lighting  High Efficiency Pool Equipment Solar Photovoltaic Systems Multiple Improvements Outdoor/Indoor Water Efficiency Type of Improvement:  Energy Efficiency: Miscellaneous:  Water Efficiency: High Efficiency HVAC Boiler High Efficiency Water Heating Reflective Coating  Building Envelope Windows/Doors/Skylights CALIFORNIA FIRST PACE STATS BAKERSFIELD  Year: # of Applications Received: # of Applications Approved: # of Applications Funded: Total Funded Value:  2014 93 48 28 $492,844 2015 575 206 98 $2,001,164 2016 829 336 234 $5,766,495 2017 207 68 50 $1,380,768 Total: 1704 658 410 $9,641,271 High Efficiency HVAC Indoor Water Efficiency  2014 (27)$324,986 2014 (0)$0 2015 (62)$361,885 2015 (1)$500 2016 (63)$611,751 2016 (1)$550 2017 (2)$12,399 2017 (0)$0 Total: (154)$1,311,021 Total: (2)$1,050 Building Envelope 2014 (7)$101,185 2015 (26)$282,297 2016 (25)$538,267 2017 (9)$176,398 Tota: (67)$1,098,147 Windows/Doors/Skylights 2014 (0)$0 2015 (15)$84,580 2016 (37)$276,441 2017 (6)$52,350 Total: (58)$413,371 High Efficiency Lighting  2014 (0)$0 2015 (1)$1,775 2016 (0)$0 2017 (0)$0 Total: (1)$1,775 Solar Photovoltaic Systems 2014 (0)$0 2015 (87)$1,022,546 2016 (284)$3,564,595 2017(74)$991,684 Total: (445)$5,578,825 Energy Efficiency:Water Efficiency: Type of Improvement:  FIGTREE/DIVIDEND PACE STATS BAKERSFIELD  Year: # of Applications Received: # of Applications Approved: # of Applications Funded: Total Funded Value:  2014 4 1 1 $44,250 2015 NA NA NA NA 2016 3 1 1 $84,000 2017 NA NA NA NA Total: 7 2 2 $128,250 Solar Photovoltaic Systems 2014 (1)$44,250 2015 $0 2016 (1)$84,000 2017 $0 Total: (3)$128,250 Energy Efficiency:Water Efficiency: Miscellaneous:  Type of Improvement:  HERO PACE STATS BAKERSFIELD  Year: # of Applications Received: # of Applications Approved: # of Applications Funded: Total Funded Value:  2014 336 147 3 $60,253 2015 2287 1578 759 $16,017,328 2016 1764 1192 715 $13,685,594 2017 398 263 176 $3,662,656 Total: 4785 3180 1653 $33,425,831 High Efficiency HVAC Outdoor Water Efficiency 2014 (4)$52,388 2014 (0)$0 2015 (265)$3,150,433 2015 (26)$310,163 2016 (234)$2,791,160 2016 (18) $158,362 2017 (57)$781,585 2017 (6)$94,487 Total: (560) $6,775,566 Total: (50) $563,012 High Efficiency Water Heating Indoor Water Efficiency  2014 (0)$0 2014 (0)$0 2015 (14)$59,646 2015 (0)$0 2016 (10)$59,823 2016 (1)$2,207 2017 (3)$24,696 2017 (0)$0 Total: (27) $144,165 Total: (1)$2,207 Building Envelope 2014 (0)$0 2015 (179)$2,008,257 2016 (164)$2,130,176 2017 (44)$533,730 Total: (387) $4,672,163 Windows/Doors/Skylights 2014 (0)$0 2015 (1895)$2,330,316 2016 (1821)$2,460,182 2017 (469)$528,078 Total: (4185) $5,318,576 High Efficiency Lighting  2014 (0)$0 2015 (62)$11,500 2016 (0)$0 2017 (33)$7,389 Total: (95) $18,889 High Efficiency Pool Equipment 2014 (0)$0 2015 (10)$24,568 2016 (7)$15,106 2017 (0)$0 Total: (17) $39,674 Solar Photovoltaic Systems 2014 (0)$0 2015 (246)$6,186,797 2016 (178)$4,539,913 2017 (53)$1,347,818 Total: (477) $12,074,528 Energy Efficiency:Water Efficiency: Type of Improvement:  YGRENE STATS BAKERSFIELD  Year: # of Applications Received: # of Applications Approved: # of Applications Funded: Total Funded Value:  2014 NA NA NA NA 2015 248 197 40 $786,520 2016 968 709 508 $10,435,887 2017 275 233 84 $1,486,895 Total: 1491 1139 632 $12,709,302 High Efficiency HVAC Water Efficiency  2014 (0)$0 2014 (0)$0 2015 (18)$295,342 2015 (3)$45,606 2016 (86)$1,522,655 2016 (40)$793,990 2017 (9)$142,028 2017 (4)$160,690 Total: (113)$1,960,025 Total: (47) $1,000,286 Insulation  2014 (0)$0 2015 (6)$111,172 2016 (31)$771,638 2017 (1)$50,901 Total: (38)$933,711 Windows/Doors 2014 (0)$0 2015 (5)$86,535 2016 (84)$1,850,253 2017 (9)$232,011 Total: (98)$2,168,799 High Efficiency Lighting  2014 (0)$0 2015 (1)$33,772 2016 (6)$181,847 2017 (5)$165,334 Total: (12)$380,953 Solar Photovoltaic Systems 2014 (0)$0 2015 (7)$219,446 2016 (202)$4,737,229 2017(38)$718,785 Total: (247) $5,675,460 Boiler 2014 (0)$0 2015 (0)$0 2016 (3)$77,017 2017 (0)$0 Total: (3)$77,017 Reflective Coating  2014 (0)$0 2015 (0)$0 2016 (9)$179,201 2017 (1)$15,216 Total: (10)$194,417 Energy Efficiency:Water Efficiency: Type of Improvement:  E3 PACE STATS BAKERSFIELD  Year: # of Applications Received: # of Applications Approved: # of Applications Funded: Total Funded Value:  2014 NA NA NA NA 2015 NA NA NA NA 2016 4 2 1 $25,811 2017 93 48 8 $351,666 Total: 97 50 9 $377,477 Building Envelope Outdoor Water Efficiency 2014 2014 2015 2015 2016 2016 2017 (1)$12,959 2017 (3)$73,338 Tota: (1)$12,959 Total: (3)$73,338 Solar Photovoltaic Systems 2014 Multiple Improvements 2015 2014 2016 (1)$25,810 2015 2017(2)$75,155 2016 Total: (3)$100,965 2017 (2)$190,214 Total: (2)$190,214 Energy Efficiency:Water Efficiency: Miscellaneous:  Type of Improvement:  Attachment C http://www.bakersfield.com/opinion/pro-con-on-pace-con-unforeseen-drawbacks-have- surfaced/article_71e15ba8-da0f-5e58-9372-746d501bedde.html Pro-Con on PACE / CON: Unforeseen drawbacks have surfaced By Harold Hanson  Apr 20, 2017 A new trend is sweeping across Kern County, offering people upgrades to their homes with energy-efficient improvements. It goes by several names, but the most common in Bakersfield is HERO — Home Energy Renovation Opportunity. Through the Property Assessed Clean Energy Program, or PACE, homeowners borrow money for the improvements as a property tax assessment that attaches to the property and appears on the homeowner’s property tax bill. The amount borrowed — the PACE loan — is structured as a super-priority lien on the property and it takes precedence over even the first mortgage upon refinancing or selling property. The goal of this program is to help homeowners reduce their utility bills by upgrading their homes with energy and water-saving home improvements. Sounds great, right? Who wouldn’t want to see a decline in their energy bills while reducing their carbon footprint and helping the environment? Unfortunately, unforeseen drawbacks to the program have surfaced. In many cases, homeowners have been misinformed as to the exact conditions of the program and have run into serious problems when selling or refinancing their homes. Most disturbing, when homeowners wish to sell their homes they are required to pay in full the HERO loan as well as other liens on the property. In many cases, homeowners find themselves in a negative position and unable to close the sale. Further, Fannie May and Freddie Mac prohibit participation of these types of programs. In spite of this fact many homeowners are not informed about this restriction and by participating in the program put their loans at risk. Bottom line is that HERO is an equity type program versus an ability to repay loan. This is a very dangerous road to follow for the homeowner. There is no evaluation in place that looks at the ability to repay. This is particularly true of homeowners on fixed incomes. The last thing the City of Bakersfield should be is associated with is the foreclosure of a home due to the homeowner’s inability to repay the increased property tax payments. High-interest rates have also plagued the program. There have seen instances where rates have been almost twice the amount of a traditional home equity loan. The high interest rates on these programs cause homeowners to pay more than their original agreed upon price, for improvements such as paint, artificial lawns, air conditioners and windows. Bakersfield Ward 5 Councilman Harold Hanson, the current Vice Mayor. Attachment D Attachment E Appraisal Institute Supports Bill Enhancing Consumer Protections for PACE Loans CHICAGO (April 26, 2017) – The Appraisal Institute joined more than two dozen other real estate organizations Monday in expressing support for federal legislation that would enhance consumer protection requirements for Property Assessed Clean Energy loans, known as PACE loans. The nation’s largest professional association of real estate appraisers, the Appraisal Institute signed a letter to the U.S. Senate and House sponsors of S. 838 and H.R. 1958, the Protecting Americans from Credit Entanglements Act of 2017. Other trade and professional associations signing the letter represent real estate professionals, home builders, and mortgage lenders and servicers. PACE loans are mortgage financing and, the groups say, should be subject to federal consumer protection requirements. The bill would provide these loans the same Truth in Lending Act consumer protections required of other mortgage products, including the Consumer Financial Protection Bureau’s “Ability-to-Repay” and “Know Before You Owe” rules and Home Ownership and Equity Protection Act standards. “PACE loans are – in substance – consumer loans secured by real property and should be subject to federal consumer protection requirements, not dependent on a patchwork of limited or non-existent state/municipal laws that do not adequately protect homeowners,” the letter said. PACE loans were developed to help finance energy-efficient retrofits on real property, such as solar panels and energy-efficient appliances and windows. While PACE program specifics vary by state and municipality, these loans usually are initiated by the private companies approving contractors to make these improvements, with financing from proceeds raised by issuing municipal revenue bonds. The bonds are secured by the payments on the PACE loan obligation; the loan payments are added to the borrower’s property tax bill and then paid through property tax installments – normally over 15 or 20 years. The outstanding PACE loan obligation then runs with the property (not the borrower) going forward. “Although PACE loan obligations have all the attributes of a mortgage product, they are not subject to federal consumer protection requirements – as this alternative financing structure has been misclassified as a tax assessment rather than a loan,” the letter said. “Consequently, a standardized, comprehensive disclosure framework does not exist for PACE loans. Moreover, there are no requirements for an assessment of a borrower’s income, credit history, outstanding credit obligations, or expected monthly payments in connection with PACE products. Instead, PACE financing today is often based on a borrower’s equity in their property and their mortgage and property tax payment history, rather than on their true ability to repay their financial debt.” Besides the Appraisal Institute, the letter was signed by 27 groups: ·American Bankers Association ·American Land Title Association ·Arkansas Land Title Association ·California Association of REALTORS® ·California Bankers Association ·California Credit Union League ·California Land Title Association ·California Mortgage Bankers Association ·Connecticut Mortgage Bankers Association Appraisal Institute Supports Bill Enhancing Consumer Protections for PACE Loans Page 2 ·Credit Union National Association ·Florida Land Title Association ·Housing Policy Council of the Financial Services Roundtable ·Independent Community Bankers of America ·Missouri Land Title Association ·Montana Land Title Association ·Mortgage Bankers Association ·Mortgage Bankers Association of Arkansas ·Mortgage Bankers Association of Florida ·Mortgage Bankers Association of Missouri ·National Association of Federally-Insured Credit Unions ·National Association of Hispanic Real Estate Professionals® ·National Association of Home Builders ·National Association of Real Estate Brokers ·National Association of REALTORS® ·New England Land Title Association ·Real Estate Service Providers Council ·The Realty Alliance. The real estate groups addressed their letter to the bills’ sponsors: Sens. Tom Cotton, R-Ark., John Boozman, R-Ark., and Marco Rubio, R-Fla., and Reps. Brad Sherman, D-Calif., and Edward Royce, R- Calif. S. 838 was referred to the Committee on Banking, Housing, and Urban Affairs on April 5. H.R. 1958 was referred to the House Committee on Financial Services on April 5. Read the real estate organizations’ Senate letter and the House letter. # # # Stay connected with the latest news from the Appraisal Institute on Facebook, Twitter, LinkedIn, YouTube and our blog, Opinions of Value. The Appraisal Institute is a global professional association of real estate appraisers, with nearly 19,000 professionals in almost 60 countries throughout the world. Its mission is to advance professionalism and ethics, global standards, methodologies, and practices through the professional development of property economics worldwide. Organized in 1932, the Appraisal Institute advocates equal opportunity and nondiscrimination in the appraisal profession and conducts its activities in accordance with applicable federal, state and local laws. Individuals of the Appraisal Institute benefit from an array of professional education and advocacy programs, and may hold the prestigious MAI, SRPA, SRA, AI-GRS and AI-RRS designations. Learn more at www.appraisalinstitute.org. Page 1 of 3 April 24, 2017 The Honorable Brad Sherman U.S. House of Representatives 2181 Rayburn House Office Building Washington, DC 20515 The Honorable Edward Royce U.S. House of Representatives 2310 Rayburn House Office Building Washington, DC 20515 Dear Representatives Sherman and Royce: The undersigned trade associations—representing collectively real estate professionals, home builders, and mortgage lenders and servicers—write today to express strong support for your recently introduced legislation, H.R.1958, the Protecting Americans from Credit Entanglements Act of 2017. While energy efficient home improvements can be beneficial for homeowners, we have serious concerns with the Property Assessed Clean Energy (PACE) program construct. Residential PACE loans are—in substance—mortgage financing and should be subject to federal consumer protection requirements. H.R.1958 will rightfully provide these loans the same Truth in Lending Act (TILA) consumer protections required of other mortgage products. As you know, PACE loans were developed to help finance energy efficient retrofits on real property—e.g., solar panels, energy efficient appliances and windows, etc. PACE program specifics vary by state/municipality, but typically these loans are initiated by the private companies approving contractors to make these improvements, with financing from proceeds raised by issuing municipal revenue bonds. The bonds are secured by the payments on the PACE loan obligation; the loan payments are added to the borrower’s property tax bill and then paid through property tax installments—typically over 15 or 20 years. The outstanding PACE loan obligation then runs with the property (not the borrower) going forward. Although PACE loan obligations have all the attributes of a mortgage product, they are not subject to federal consumer protection requirements—as this alternative financing structure has been misclassified as a tax assessment rather than a loan. Consequently, a standardized, comprehensive disclosure framework does not exist for PACE loans. Moreover, there are no requirements for an assessment of a borrower’s income, credit history, outstanding credit obligations, or expected monthly payments in connection with PACE products. Instead, PACE financing today is often based on a borrower’s equity in their property and their mortgage and property tax payment history, rather than on their true ability to repay their financial debt. Moreover, PACE loan interest rates—typically between eight and twelve percent—are exponentially higher than traditional mortgage products and other available financing options, Page 2 of 3 despite the fact that they hold the same priority position as unpaid property taxes. Saleability issues also exist for homes encumbered by a PACE loan,1 and consumers are complaining— through the Wall Street Journal2 and other media—about a lack of real understanding over what their PACE loan terms entail. PACE loan consumer protections currently vary from state-to-state, municipality-to- municipality, and above all they do not treat PACE loans like the mortgage financing products they are. If enacted, H.R.1958 would protect American homeowners by requiring federal TILA- rooted requirements and considerations for PACE loans—including the Consumer Financial Protection Bureau’s “Ability-to-Repay” and “Know Before You Owe” rules, Home Ownership and Equity Protection Act standards, etc. Again, PACE loans are—in substance—consumer loans secured by real property and should be subject to federal consumer protection requirements, not dependent on a patchwork of limited or non-existent state/municipal laws that do not adequately protect homeowners. We appreciate your recognition of the need for straightforward, appropriate protections in this space. Thank you again for your introduction of H.R.1958. We look forward to working with you and other members of Congress to advance this important legislation. Sincerely, American Bankers Association American Land Title Association Appraisal Institute Arkansas Land Title Association California Association of REALTORS® California Bankers Association California Credit Union League California Land Title Association California Mortgage Bankers Association Connecticut Mortgage Bankers Association Credit Union National Association Florida Land Title Association Housing Policy Council of the Financial Services Roundtable Independent Community Bankers of America Missouri Land Title Association 1 Although outstanding PACE loan obligations technically “run with the property,” real estate professionals report that many subsequent purchasers of these homes reject the presence of a PACE loan obligation and insist that the seller extinguish the PACE financing before consummating the purchase. This leaves the original borrowers with a closing table surprise and far less in sale proceeds than they anticipated. The presence of the PACE loan obligation may also negatively impact home values, especially in foreclosure situations. 2 See e.g., “America’s Fastest-Growing Loan Category Has Eerie Echoes of Subprime Crisis” (available at https://www.wsj.com/articles/americas-fastest-growing-loan-category-has-eerie-echoes-of-subprime-crisis- 1484060984?mod=itp&mod=djemITP_h); and “Renovate America Masked Borrower Debt Woes” (available at https://www.wsj.com/articles/renovate-america-one-of-americas-fastest-growing-lenders-didnt-disclose-it-made-payments-to- some-borrowers-1488969001). Page 3 of 3 Montana Land Title Association Mortgage Bankers Association Mortgage Bankers Association of Arkansas Mortgage Bankers Association of Florida Mortgage Bankers Association of Missouri National Association of Federally-Insured Credit Unions National Association of Hispanic Real Estate Professionals® National Association of Home Builders National Association of Real Estate Brokers National Association of REALTORS® New England Land Title Association Real Estate Service Providers Council The Realty Alliance Attachment F 1 From: Kim Schaefer [mailto:kim@bakersfieldrealtor.org] Sent: Thursday, May 25, 2017 2:23 PM To: Alan Tandy Cc: Steven L. Teglia; Chris Huot; Jimmy Yee; Linda Jay Subject: List of Complaints Alan,   Here is a list of verifiable complaints that I have been able to compile. I am still adding to it as more people are coming  forward. I do expect to add more complaints to the list before Tuesday. I will send you updated copies as we add to this  list. Please let me know if you are looking for anything else that would be helpful.  I have omitted names, addresses and  contact information because homeowners have experienced intimidation from some of the PACE vendors in the past.  There are also a few cases where the homeowner would like to remain anonymous. Thank you.   Sincerely, Kim Schaefer  Government Affairs Director 2300 Bahamas Dr.  Bakersfield, CA 93309  P|661.635.2306 F|661.635.2022  This e‐mail message, together with any attachments, is intended only for the use of the individual or entity to which it is addressed. It may contain information that is  confidential and prohibited from disclosure. If you are not the intended recipient, you are hereby notified that any dissemination or copying of this message or any  attachment is strictly prohibited. If you have received this e‐mail in error, please notify the original sender at (661) 635‐2300 and destroy this e‐mail, along with any  attachments. Thank you. Ad d r e s s I m p r o v e m e n t / L e n d e r / N o t e s Ca s e A HE R O / P a i n t / $ 1 0 , 0 0 0 - B e s t V a l u e H o m e R e m o d e l - M a r k G r e e n . T r i e d t o s e l l h o m e b u t r e c e i v e d n o o f f e r s … h o m e s t i l l o n t h e m a r k e t … s e v e r a l a t t e m p t s t o ge t a h o l d o f H E R O , h a v e b e e n w a i t i n g a m o n t h f o r a c a l l b a c k … i m p r o v e m e n t s a r e f a i l i n g - P a i n t i s p e e l i n g Ca s e B Bo u g h t a g o t w a t e r h e a t e r , n o t a s e f f i c i e n t a s t h e y t h o u g h , h a d s o m e h e a l t h i s s u e s , h a v e n t p a i d m o r t g a g e i n t w o m o n t h s a s o f 5 / 2 0 . T h e y a r e n o t s a v i n g mo n e y o n t h e e n e r g y b i l l . Ca s e C HE R O - $ 2 0 , 0 0 0 w i n d o w s , d o o r s , d o g g y d o o r - T r y i n g t o s e l l t h e h o m e , b u y e r s w o n ' t e v e n c o n s i d e r b u y i n g w i t h t h e l e i n o n t h e h o m e Ca s e D HE R O - $ 2 6 , 0 0 0 i n w i n d o w s Ca s e E YG R E N E 2 4 , 0 0 0 R V P a r k i n g a n d P a t i o Ca s e F HE R O R o o f / $ 2 4 , 0 0 0 I n t e r e s t R a t e 8 . 9 5 f o r 2 0 y e a r s . M i s r e p r e s e n a t i o n a n d p r i c e g o u g i n g . B e h i n d o n h e r m o r t g a g e - p a y m e n t s w e n t u p f r o m 1 1 8 7 . 9 3 t o 16 7 2 . 2 5 - h a s c a n c e r a n d i s o n a f i x e d i n c o m e - t r y i n g t o f i l e b a n k r u p t c y , b u t c a n n o t b e c a u s e s h e i s b e h i n d o n t h e m o r t g a g e p a y m e n t . T h e f a m i l y c a n n o t ev e n b u y g r o c e r i e s a t t h i s p o i n t . Ca s e G HE R O - w a s t r a n s f e r r e d d u r i n g t h e s a l e w i t h o u t k n o w l e d g e o r c o n s e n t - O n e y e a r l a t e r m o n t h l y m o r t g a g e p a y m e n t w e n t u p b y $ 2 0 0 p e r m o n t h . O w n e r ca n n o t a f f o r d . T h i s c a s e i s c u r r e n t l y i n m e d i a t i o n a n d m a y n e e d t o b e h a n d l e d i n c o u r t . Ca s e H HE R O - f o r w i n d o w s w a s t r a n s f e r r e d d u r i n g t h e s a l e w i t h o u t k n o w l e d g e o r c o n s e n t - O n e y e a r l a t e r m o n t h l y m o r t g a g e p a y m e n t w e n t u p b y $ 2 0 0 p e r mo n t h . O w n e r c a n n o t a f f o r d . T h i s c a s e i s c u r r e n t l y i n m e d i a t i o n a n d m a y n e e d t o b e h a n d l e d i n c o u r t . Ca s e I HE R O - $ 3 6 , 6 8 5 f o r H V A C u n i t , n e w d u c t s , e n e r g y e f f i c i e n t w i n d o w s a n d s l i d i n g g l a s s d o o r s . H o m e o w n e r s a r e v e t e r a n s . V A a t t h e t i m e d i d n o t u n d e r s t a n d PA C E w e l l . V e t e r a n s n o w n e e d t o s e l l f o r p e r s o n a l r e a s o n s , b u t w i l l h a v e t o p a y o f f t h e l o a n i n o r d e r t o d o s o . T h e y h a d n o w a y o f a n t i c i p a t i n g t h i s t u r n o f ev e n t s a n d i t h a s c a u s e d a g r e a t d e a l f i n a n c i a l a n d e m o t i o n a l s t r e s s a n d h a r m . Ca s e J HE R O - $ 4 7 , 2 3 4 I n t e r e s t r a t e 1 0 . 5 2 % Ca s e K Pa i n t - B e s t V a l u e H o m e I m p r o v e m e n t s - P r o g r a m M i s r e p r e s e n t a t i o n - s p a n i s h s p e a k i n g - e l d e r l y - c a n n o t a f f o r d m o n t h l y i n c r e a s e i n m o r t g a g e p a y m e n t s Ca s e L YG R E N E - H V A C $ 8 0 0 0 - C o m p l a i n t i s p r i c e g o u g i n g m i s r e p r e s e n a t i o n o f a g o v e r n m e n t p r o g r a m a n d d i d n o t e x p l a i n l i e n s t a t u s . Ca s e M HE R O - $ 3 8 , 2 7 6 . 2 5 H V A C , W i n d o w s , E x t e r i o r D o o r s , P r e - p a y m e n t p e n a l t y o f 5 . 3 % . C o m p l a i n t i s p r i c e g o u g i n g , h i g h f e e s a n d i n t e r e s t . M i s r e p r e s e n t a t i o n o f th e p r o g r a m . Ca s e N HV A C U n i t $ 1 2 , 0 0 0 P r i c e G o u g i n g a n d p r o p e r t y f a i l e d t o s e l l d u e t o a s s e s s m e n t p a y o f f . Ca s e O Se n i o r h o m e o w n e r o n a f i x e d i n c o m e - i s b e i n g f o r c e d t o t r y t o f i n d a r e v e r s e m o r t g a g e i n o r d e r t o s t a y i n h e r h o m e . H e r m o n t h l y m o r t g a g e p a y m e n t we n t u p $ 4 3 5 . 8 6 . S h e w a s m i s l e d . Ca s e P YG R E N E - H V A C - C o m p l a i n t i s p r i c e g o u g i n g m i s r e p r e s e n a t i o n o f a g o v e r n m n e t p r o g r a m Ca s e Q YG R E N E - S h a r p C o n s t r u c t i o n - P e e p h o l e , w i n d o w s , r o o f . M i s r e p r e s e n t a t i o n , w a s t o l d i t w a s g o v e r n m e n t p r o g r a m , e l d e r l y w o m a n t a k e n a d v a n t a g e o f . $3 8 , 2 9 6 . 8 8 Ca s e R HE R O - H o m e o w n e r n e e d e d t o d o a q u i c k s a l e b e c a u s e o f a j o b t r a n s f e r . H o m e o w n e r w a s t o l d t h a t t h e m a n w h o s o l d t h e p r o d u c t t o h e r t h a t t h i s w a s a go v e r n m e n t p r o g r a m a n d t h a t s h e w o u l d n o t h a v e t o p a y a d i m e o u t o f p o c k e t . S h e w a s c o u n t i n g o n t h e $ 1 0 , 0 0 0 i n e q u i t y s h e w o u l d r e c i e v e a s pr o c e e d s f r o m t h e s a l e . I t w a s t h e o n l y m o n e y s h e h a d . S h e w a l k e d a w a y w i t h o n l y a f e w h u n d r e d d o l l a r s t o h e r n a m e . Ca s e S HE R O - P r i c e G o u g i n g - $ 7 8 , 0 0 0 c h a r g e d f o r 2 3 t o n H V A C u n i t s b y O n e H o u r H e a t i n g a n d C o o l i n g . Ca s e T HV A C U n i t $ 8 , 0 0 0 - M i s r e p r e s e n a t i o n - H o m e o w n e r s d i d n o t u n d e r s t a n d t h a t t h i s w a s l i e n i n p r i o r i t y o f t h e i r h o m e , r e c e i v e d a n o t i c e t h a t i m p o r u d a c c o u n t wa s $ 1 7 0 0 s h o r t a n d m o n t h l y m o r t g a g e p a y m e n t s w e n t u p b y $ 1 3 0 . T h i s i s n o t w h a t t h e y w e r e t o l d . T h e y w a n t t o s e l l t o m o v e i n t o a n a d u l t c o m m u n i t y , bu t t h e y c a n n o t b e c a u s e t h e c o s t t o p a y o f f t h e l i e n w i l l l e a v e t h e m w i t h n o t h i n g t o p u t d o w n o n a n e w h o m e . Ca s e U HE R O M o n t h l y m o r t g a g e p a y m e n t s i n c r e a s e d $ 3 7 8 . 2 8 . S t u c c o p a i n t a n d a s t r o t u r f f o r $ 2 8 , 5 1 4 . H o m e o w n e r s c a n n o t s e l l o r a f f o r d t o s t a y i n t h e i r h o m e . Ca s e V HE R O - E m b a r r a s s e d c l i e n t w a s t o l d p a y m e n t s w o u l d b e d e l a y e d a y e a r . H i s i m p o u n d a c c o u n t w a s i n t h e n e g a t i v e . H e w a s m i s l e d . Ca s e W HE R O - A p p r o x i m a t e l y 5 4 , 0 0 0 f o r m u l t i p l e i m p r o v e m e n t s . W a s a p p r o v e d f o r t h e l o a n w h i l e u n e m p l o y e d a n d t h e n h a d t o m o v e t o g e t a n e w j o b ( o i l in d u s t r y ) . H e i s u p s i d e d o w n a n d t h e o n l y o p t i o n i s a s h o r t s a l e . Ca s e Z 14 1 0 9 W e l l i n g t o n h a s b e e n u p f o r s a l e s i n c e A u g u s t , 2 0 1 4 - E x p i r e d o r c a n c e l l e d l i s t i n g 4 t i m e s . H a s b e e n l i s t e d b y a n R E O a g e n t f o r 5 4 d a y s . I t f e l l o u t o f co n t r a c t a n d i s b a c k a c t i v e a g a i n . T h e n e i g h b o r s h a v e b e e n k e e p i n g u p t h e y a r d f o r t h e p a s t t w o y e a r s . Attachment G 1 From:Alan Tandy Sent:Wednesday, May 17, 2017 12:52 PM To:Michelle Cruz Subject:FW: PACE Participation Agreement Attachments:City of Bakersfield - PACE Participation Agreement Draft (1).docx; ATT00001.htm Copy pls  From: Andrae Gonzales [mailto:andraeg3000@gmail.com] Sent: Wednesday, May 17, 2017 10:27 AM To: Alan Tandy; Steven L. Teglia Subject: Fwd: PACE Participation Agreement Sent from my iPhone Begin forwarded message: From: Jeremy Hutman <jhutman@renewfinancial.com> Date: May 16, 2017 at 3:50:36 PM PDT To: andraeg3000@gmail.com, andrae@andraegonzales.com Subject: PACE Participation Agreement Hi Council Member Gonzales, I hope all has been well. I wanted to follow up with you as I have not been in touch since we met several weeks ago. I believe Dustin Reilich already sent you a copy of the draft of a PACE participation agreement. I have attached another copy in case you did not already have it. Our goal is to work with the City and all stakeholders to establish a local PACE policy that ensures PACE providers and participating contractors meet the highest levels of consumer protections. Most importantly, we wanted to make it clear that the PACE programs and contractors are accountable to the City for not meeting standards. We tried to include the details that you felt were most critical to protect consumers, especially clear disclosures, cost caps and strong contractor management. Please confirm that you received the participation agreement and let me know if there are any next steps you recommend. Thanks, Jeremy Jeremy Hutman Regional PACE Director Direct: 510-350-3711 Cell: 240-671-9802 jhutman@renewfinancial.com renewfinancial.com Follow us on Twitter | Facebook | LinkedIn   Participation Agreement for City of Bakersfield Property Assessed Clean Energy Providers     The Property Assessed Clean Energy (PACE) program has been widely promoted in California as  an innovative and alternative form of financing for energy and water saving improvements for  the benefit of property owners and the public. The City of Bakersfield has enabled multiple  PACE programs to offer financing to property owners within its borders.     Requirements described in this Participation Agreement ensure that PACE programs authorized  to operate in the City of Bakersfield maintain the highest levels of consumer protections and  industry best practices and are accountable to the City for non‐compliance. PACE is available for  residential, commercial, industrial, agricultural and non‐profit properties. This Participation  Agreement applies to residential PACE programs, which is limited by state law in California to 1‐ 3 unit residential properties.      Part 1: Eligible Measures    PACE enabling legislation only allows for permanently fixed energy efficiency, renewable  energy, water conservation, electric vehicle infrastructure and seismic improvements. Under  State law, PACE programs may only finance measures within these categories. PACE programs  must provide the City with a list of eligible measures along with specifications for each measure  where such specifications must meet national or state standards (such as U.S. Department of  Energy or California Energy Commission).      Part 2: Eligible Contractors    Only contractors with an active license through the Contractors State License Board (CSLB) are  eligible to participate in the PACE program. All contractors will be subject to CSLB bonding and  insurance requirements, along with marketing standards.       Part 3: Disclosures    The consumer obligation to repay voluntary contractual assessments created by the PACE  program may be misunderstood by homeowners. Prior to a homeowner signing any financing  documents, PACE providers must provide a two‐part disclosure process to ensure thorough  homeowner understanding of the terms contained in a PACE assessment contract:     1. Written disclosures in accordance with AB 2693 (Dababneh 2016). PACE programs must  plainly disclose to homeowners the terms of the financing:   a. The amount financed, fees and capitalized interest included  b. The repayment process and schedule  c. The payment amounts  d. A term that does not exceed the useful life of the majority of the improvements,  e. The effective rate of interest charged (APR)  f. A rate of interest that is fixed (not variable),   g. Payment schedule that fully amortizes the amount financed  h. The nature of the lien created upon recordation  i. The specific improvements to be installed  j. The 3‐day right to cancel the financing  k. FHFA policy toward PACE.    2. A live call by the PACE Administrator, without the contractor’s participation, to confirm  the terms of the financing. The call must be recorded.     Per AB 2693 the disclosures must be the following (or substantially equivalent):     Financing Estimate and Disclosure    Notice to Property Owner: You have the right to request that a hard copy of this document  be provided to you before and after reviewing and signing. The financing arrangement  described below will result in an assessment against your property which will be collected  along with your property taxes and will result in a lien on your property. You should read and  review the terms carefully, and if necessary, consult with a tax professional or attorney.    Customer Service Toll‐Free telephone number and email:  In the event you have a consumer complaint, questions about your financing obligations  related to the contractual assessment or your contractual rights under the terms of this  contract, you can contact either this toll‐free telephone number or email address provided  below and receive a response within 24 hours or one business day.  Toll‐Free telephone number: ___________  Customer service email address: ___________    Products and Costs  Product costs (including labor/installation)          $________  Description  1.  2.  3.    Financing Costs   Application fees and costs      $________  Prepaid Interest                        $________  Other Costs                               $________  Total Amount Financed           $________    Annual Percentage Rate (APR)                                                         ______%  Simple Interest Rate                                                                           ______%  Total Annual Principal, Interest, and Administrative Fees        $______    Note: If your property taxes are paid through an impound account, your mortgage lender  may apportion the amount and add it to your monthly payment.    See “Other Important Considerations” below    Total Amount you will have paid over the life of the financing       $________    Other Costs  Appraisal Fees                               $________  Bond related costs                       $________  Annual Administrative fees        $________  Estimated closing costs               $________  Credit Reporting Fees                  $________  Recording Fees                             $________    Total Financing Costs and Closing Costs         $________  Estimated Cash (out of pocket) to close         $________    Other Terms  Prepayment fee         ◻ No              ◻ Yes ______    Additional Information About These Financing  Comparisons [Use this information to compare to other financing options]    Over the term of the financing  $________ Principal you will have paid off.  $________ Amount of interest you have paid.  $________ Amount of financing and other costs you will have paid.  $________ Total you will have paid.    Annual Percentage Rate ______%  Total Interest Paid (as a percentage of all the payments you have made) ______%    Other Important Considerations  I understand that I may be required to pay off the remaining balance of this obligation by the  mortgage lender refinancing my home. If I sell my home, the buyer or their mortgage lender  may require me to pay off the balance of this obligation as a condition of sale.  _____ _______________  _____ [Borrower initials]    Monthly Mortgage Payments  Your payments will be added to your property tax bill. Whether you pay your property taxes  through your mortgage payment, using an impound account, or if you pay them directly to  the tax collector, you will need to save an estimated $_______ for your first tax installment. If  you pay your taxes through an impound account you should notify your mortgage lender, so  that your monthly mortgage payment can be adjusted by your mortgage lender to cover your  increased property tax bill.  _____ _______________  _____ [Borrower initials]    Tax Benefits: Consult your tax adviser regarding tax credits, credits and deductions, tax  deductibility, and other tax benefits available. Making an appropriate application for the  benefit is your responsibility.  _____ _______________  _____ [Borrower initials]    Statutory Penalties: If your property tax payment is late, the amount due will be subject to a  10% penalty, late fees, and 1.5% per month interest penalty as established by state law, and  your property may be subject to foreclosure.  _____ _______________  _____ [Borrower initials]    Three Day Right to Cancel  You, the property owner, may cancel the contract at any time on or before midnight on the  third business day after the date of the transaction to enter into the agreement without any  penalty or obligation. To cancel this transaction, you may mail or deliver a signed and dated  copy of the contract with notice of cancellation to:  ___________ [name of business] at  ___________ [address]    You may also cancel the contract by sending notification of cancellation by email to the  following email address: _________________[email address of business].  _____ _______________  _____ [Borrower initials]    Confirmation of Receipt  This confirms the receipt of the information in this form. You do not have to accept this  financing just because you acknowledge that you have received or signed this form, and it is  NOT a contract.    __________________________  [Property Owner Signature ‐ Date]    __________________________  [Property Owner Signature ‐ Date]      Part 4: Project Cost     PACE programs must allow – and in fact encourage – homeowners to seek multiple bids for  projects. Even with the ability to compare bids, homeowners may be subject to overcharging by  contractors. To prevent overcharging:     1. PACE providers must follow the statewide best practice of placing caps on the cost of  individual measures. If a measure is above a certain price per applicable unit, the  contractor must provide justification to the PACE provider for the additional expense.   2. PACE programs may not share with contractors the maximum financing amount for  which a homeowner has been approved, unless the homeowner has given the Provider  permission to do so.        Part 5: Underwriting    PACE programs must participate in the State PACE Loss Reserve Program administered by the  California State Treasurer’s Office. The California Treasurer’s Office sets PACE underwriting  standards through this program. PACE programs must provide evidence to the City of their  participation in the program annually or within six weeks of the request of the City.     PACE programs must also include in their underwriting criteria a consideration of a  homeowner’s income and debt obligations in order to determine if the homeowner is able to  meet the PACE obligation.    In accordance with State law, PACE programs may not allow a homeowner to use PACE if the  owner’s participation would result in the total amount of all annual property taxes and  assessments exceed five percent (5%) of the property’s market value, as determined at the  time of approval of the owner’s contractual assessment.      Part 6: Tax Treatment    On June 10, 2016 the IRS provided the following guidance on PACE:     There are popular loan programs that finance energy saving improvements through  government‐approved programs. You sign up for a home energy system loan and use the  proceeds to make energy improvements to your home. In some programs, the loan is secured by  a lien on your home and appears as a special assessment or special tax on your real estate  property tax bill over the period of the loan. The payments on these loans may appear to be  deductible real estate taxes; however, they're not deductible real estate taxes. Assessments or  taxes associated with a specific improvement benefitting one home aren't deductible. However,  the interest portion of your payment may be deductible as home mortgage interest. Refer to  Publication 936, Home Mortgage Interest Deduction, to see whether you might qualify for a  home mortgage interest expense deduction. Program administrators and contractor shall only  refer tax‐related questions to a tax professional.     PACE programs and their participating contractors are prohibited from indicating to a  homeowner that the entire PACE payment is tax deductible. They must instead refer all tax‐ related questions to a tax professional.      Part 7: Dispute Resolution    PACE program must receive, manage, track and timely address inquiries and complaints from  homeowners. The PACE program must also establish a due process system to evaluate  contractor complaints, and have a process to suspend and/or terminate contractors who  violate PACE program policies.    Part 8: Contractor Conduct    PACE programs must prohibit practices that are or could appear to be unfair, deceptive,  abusive, and/or misleading, that violate laws or regulations, that provide tax advice, that are  inappropriate, incomplete or are inconsistent with the PACE program’s purpose. PACE  programs must require that all participating contractors sign a code of conduct that clearly  outlines a prohibition of these practices along with steps for penalizing a contractor and their  staff for misrepresenting the PACE program or any other form of non‐compliance, including  aggressive marketing tactics. The penalties must range from re‐training to being expelled  permanently from the PACE program.     Part 9: Reporting    PACE programs must provide the City with aggregate program data on a quarterly basis. This  shall include fields related to number of projects, energy and water savings and economic  impact. Because of data privacy requirements and commitments, PACE programs shall not be  required to provide details of individual projects unless each project is anonymized (i.e.  individual project‐level data shall not contain personally identifiable information).    Documents Presented At The Budget and Finance Committee May 30, 2017 Meeting Tu e s d a y ,   Ma y   30 ,   20 1 7 • Th e  re a l  is s u e  be f o r e  th e    Co m m i t t e e ‐ st a t e d  si m p l y • Is  it  in  th e  be s t  in t e r e s t s  of  yo u r  co n s t i t u e n t s  to  continue to  al l o w  pl a c e m e n t  of  PA C E  ch a r g e s  on  th e  pr o p e r t y  tax bills? • In  20 0 8 ,  th e  St a t e  of  Ca l i f o r n i a  en a b l e s  Ci t i e s  to  pa r t i c i p a t e  in  PA C E  programs • Cl e a n  en e r g y  im p r o v e m e n t s  ar e  al l o w e d  to  be  pl a c e d  on  pr o p e r t y  tax bills as a  pr i o r i t y  li e n ! • Ba k e r s f i e l d  ha s  au t h o r i z e d  fi v e  PA C E  pr o v i d e r s  to  op e r a t e .  Na m e s  and contract  ap p r o v a l  da t e s  ar e : PA C E  Pr o g r a m  Pr o v i d e r   Da t e  En t e r e d  In t o  Co n t r a c t Ca l i f o r n i a F I R S T Ma r c h  24 ,  20 1 0 Fi g t r e e Ap r i l  17 ,  20 1 3 HE R O Au g u s t  13 ,  20 1 4 Yg r e n e  Wo r k s  an d   Se p t e m b e r  16 ,  20 1 5 En e r g y  Ef f i c i e n t  Eq u i t y  (E 3 ) • PA C E  Pr o v i d e r s  re p o r t  th a t  si n c e  20 1 4 ,  a to t a l  of  2, 7 0 6  pr o j e c t s  ha v e  be e n  completed.   Of  th o s e ,  1, 1 7 4  ar e  fo r  so l a r  en e r g y  an d  10 5  ar e  fo r  dr o u g h t  re l a t e d  pr o j e c t s .   The  re m a i n i n g  ba l a n c e  is  fo r  ro o f  re p l a c e m e n t s ,  ai r  co n d i t i o n i n g ,  do o r s ,  windows and  re l a t e d .  As s o c i a t i o n o f R e a l t o r s ( f o u n d e d i n B a k e r s f i e l d s i n c e 1 9 0 5 ) h a s a p p r o a c h e d th e C i t y r e q u e s t i n g t h a t t h e c o n t r a c t s w i t h t h e P A C E p r o v i d e r s b e te r m i n a t e d . T h e r e h a v e b e e n s i m i l a r r e q u e s t s a t t h e s t a t e a n d f e d e r a l l e v e l fo r r e f o r m s i n r e g a r d s t o P A C E – i t i s n o t l i m i t e d t o B a k e r s f i e l d .  Al l e g a t i o n s i n c l u d e : ( s e e E x h i b i t C i n p a c k e t )  Cu s t o m e r s w h o d i d n o t u n d e r s t a n d t h e i r p r o p e r t y t a x b i l l w a s g o i n g u p t h u s ex p e r i e n c i n g h a r d s h i p s .  Ou t o f m a r k e t c o s t s f o r i m p r o v e m e n t s  Ou t o f m a r k e t i n t e r e s t r a t e s  Di s r u p t i o n s o f r e a l e s t a t e t r a n s a c t i o n s d u e t o t h e p r i o r i t y l i e n s t a t u s o f P A C E l o a n s .  St a n d a r d h o m e i m p r o v e m e n t s – r o o f s , a i r c o n d i t i o n i n g , e t c . d o n o t b e l o n g o n t h e t a x bi l l . P r i o r t o P A C E t h e y w e r e r o u t i n e l y d o n e i n t h e f r e e m a r k e t p l a c e .  PA C E p r o v i d e r s c o u n t e r w i t h ( s e e E x h i b i t D i n p a c k e t ) :  Th e y c r e a t e j o b s  Th e y i m p r o v e e n e r g y e f f i c i e n c y  Di s c l o s u r e l a w s h a v e i m p r o v e d  Ad d i t i o n a l d i s c l o s u r e s l a w s a n d a p p l i c a t i o n o f f e d e r a l c o n s u m e r p r o t e c t i o n s t a n d a r d s ar e u n d e r c o n s i d e r a t i o n i n t h e L e g i s l a t u r e a n d C o n g r e s s .  PA C E P r o v i d e r s a r e w i l l i n g t o e n t e r i n t o a “ P a r t i c i p a t i o n A g r e e m e n t ” w i t h t h e C i t y .  Bo t h , t h e A s s o c i a t i o n o f R e a l t o r s a n d P A C E P r o v i d e r s , h a v e pr o v i d e d n u m e r o u s m a t e r i a l s t o t h e C i t y . M o s t a r e i n at t a c h m e n t s t o t h e a g e n d a . B o t h h a v e a d v e r t i s e d , s e n t em a i l s a n d r e l a t e d .  Th e t w o p a r t i e s m e t w i t h C i t y s t a f f i n a n e f f o r t t o r e a c h a n a c c o m m o d a t i o n . T h a t w a s n o t s u c c e s s f u l .  In t h e o p i n i o n o f s t a f f , p e r h a p s t h e m o s t m e a n i n g f u l co m m u n i c a t i o n o f a l l c a m e f r o m K e r n C o u n t y A s s e s s o r ‐ Re c o r d e r J o n L i f q u i s t w h o s e i n c o m e i s n o t d e p e n d e n t o n th i s d e b a t e a n d w h o h a s d i r e c t c o n t a c t w i t h t h e i m p a c t e d pr o p e r t y o w n e r s .  No r e c o m m e n d a t i o n i s b e i n g m a d e t o d a y  St a f f d o e s b e l i e v e t h a t t h e r e i s s u b s t a n t i a l e v i d e n c e o f ne g a t i v e u n i n t e n d e d c o n s e q u e n c e s h a v i n g o c c u r r e d a s a re s u l t o f C i t y a l l o w a n c e o f t h e P A C E p r o g r a m .  It a p p e a r s a l l o f t h e c o m p l a i n t s a r e a b o u t t w o o f t h e fi v e p r o v i d e r s .  Pr e d o m i n a n t t y p e s o f i m p r o v e m e n t s a p p e a r t o b e HV A C , p a i n t , a n d w i n d o w s a n d d o o r s .  Th e f u t u r e o u t c o m e o f r e f o r m s a t t h e s t a t e a n d f e d e r a l l e v e l ar e u n k n o w n . Ad d r e s s I m p r o v e m e n t /  Le n d e r /  No t e s   Ca s e A H E R O / P a i n t / $ 1 0 , 0 0 0 ‐Be s t V a l u e H o m e R e m o d e l ‐ Ma r k G r e e n . T r i e d t o s e l l h o m e b u t r e c e i v e d n o o f f e r s … h o m e s t i l l o n t h e m a r k e t …s e v e r a l a t t e m p t s t o g e t a h o l d o f H E R O , h a v e b e e n w a i t i n g a m o n t h f o r a c a l l ba c k … i m p r o v e m e n t s a r e f a i l i n g ‐ Pa i n t i s p e e l i n g Ca s e B H E R O ‐Bo u g h t a h o t w a t e r h e a t e r , n o t a s e f f i c i e n t a s t h e y t h o u g h , h a d s o m e h e a l t h i s s u es , h a v e n ' t p a i d m o r t g a g e i n t w o m o n t h sa s o f 5 / 2 0 . T h e y a r e n o t s a v i n g m o n ey o n t h e e n e r g y b i l l . Ca s e C H E R O ‐ $2 0 , 0 0 0 w i n d o w s , d o o r s , d o g g y d o o r ‐Tr y i n g t o s e l l t h e h o m e , b u y e r s w o n ' t e v e n c o n s i d e r b u y i n g w i t h t h e l i e n o n t h e h o m e Ca s e D H E R O ‐ $2 6 , 0 0 0 i n w i n d o w s Ca s e E Y G R E N E 2 4 , 0 0 0 R V P a r k i n g a n d P a t i o m i s l e d r e g a r d i n g h o w t h e p a y m e n t s w o ul d b e m a d e , t h e y h a d d i f f i c u l t y i n r e f i n a n c i n g a n d h a d t o p a y t h e l i e n o f f i n o r d e r t o r e f i n a n c e Ca s e F H E R O R o o f / $ 2 4 , 0 0 0 I n t e r e s t R a t e 8 . 9 5 f o r 2 0 y e a r s . M i s r e p r e s e n t a t i o n a n d p r i c e g o u g i n g . B e h i n d o n h e r m o r t g a g e ‐ pa y m e n t s w e n t u p f r o m 1 1 8 7 . 9 3 t o 1 6 7 2 . 2 5 ‐ ha s c a n c e r a n d i s o n a f i x e d i n c o m e ‐tryingtofile ba n k r u p t c y , b u t c a n n o t b e c a u s e s h e i s b e h i n d o n t h e m o r t g a g e p a ym e n t . T h e f a m i l y c a n n o t e v e n b u y g r o c e r i e s a t t h i s p o i n t . Ca s e G H E R O ‐ wa s t r a n s f e r r e d d u r i n g t h e s a l e w i t h o u t k n o w l e d g e o r c o n s e n t ‐ On e y e a r l a t e r m o n t h l y m o r t g a g e p a y m e n t w e n t u p b y $ 2 0 0 p e r m o n t h . O w n e r c a n n o t a f f o r d . T h i s c a s e i s c u r r e n t l y i n m e d i a t i o n a n d m a y ne e d t o b e h a n d l e d i n c o u r t . Ca s e H H E R O ‐ fo r w i n d o w s w a s t r a n s f e r r e d d u r i n g t h e s a l e w i t h o u t k n o w l e d g e o r c o n s e n t ‐ On e y e a r l a t e r m o n t h l y m o r t g a g e p a y m e n t w e n t u p b y $ 2 0 0 p e r m o n t h . O w n e r c a n n o t a f f o r d . T h i s c a s e i s c u r r e n t l y i n me d i a t i o n a n d m a y n e e d t o b e h a n d l e d i n c o u r t . Ca s e I H E R O ‐ $3 6 , 6 8 5 f o r H V A C u n i t , n e w d u c t s , e n e r g y e f f i c i e n t w i n d o w s a n d s l i d i n g g l a s s d o o r s . H o m e o w n e r s a r e v e t e r a n s . V A a t t h e t i m e d i d n o t u n d e r s t a n d P A C E w e l l.Veteransnowneedtosellforpersonal re a s o n s , b u t w i l l h a v e t o p a y o f f t h e l o a n i n o r d e r t o d o s o . T h e y h a d n o w a y o f a n t i c i p a t i n g t h i s t u r n o f e v e n t s a n d i t h a s c a u s e d a g r e a t d e a l f i n a n c i a l a n d e mo t i o n a l s t r e s s a n d h a r m . Ca s e J H E R O ‐$4 7 , 2 3 4 I n t e r e s t r a t e 1 0 . 5 2 % Ca s e K H E R O P a i n t ‐ Be s t V a l u e H o m e I m p r o v e m e n t s ‐ Pr o g r a m M i s r e p r e s e n t a t i o n ‐ Sp a n i s h s p e a k i n g ‐ el d e r l y ‐ ca n n o t a f f o r d m o n t h l y i n c r e a s e i n m o r t g a g e p a y m e n t s Ca s e L Y G R E N E ‐ HV A C $ 8 0 0 0 ‐ Co m p l a i n t i s p r i c e g o u g i n g m i s r e p r e s e n t a t i o n o f a g o v e r n m e n t p r o g r a m a n d d i d n o t e x p l a i n l i e n s t a t u s . Ca s e M H E R O ‐ $3 8 , 2 7 6 . 2 5 H V A C , W i n d o w s , E x t e r i o r D o o r s , P r e ‐pa y m e n t p e n a l t y o f 5 . 3 % . C o m p l a i n t i s p r i c e g o u g i n g , h i g h f e e s a n d i n t e r e s t . M i s r e p r e s e n t a t i o n o f t h e p r o g r a m . Ca s e N H V A C U n i t $ 1 2 , 0 0 0 P r i c e G o u g i n g a n d p r o p e r t y f a i l e d t o s e l l d u e t o a s s e s s m e n t p a y o f f . Ca s e P Y G R E N E ‐ HV A C ‐ Co m p l a i n t i s p r i c e g o u g i n g m i s r e p r e s e n t a t i o n o f a g o v e r n m e n t p r o g r a m Ca s e Q Y G R E N E ‐Sh a r p C o n s t r u c t i o n ‐ Pe e p h o l e , w i n d o w s , r o o f . M i s r e p r e s e n t a t i o n , w a s t o l d i t w a s g o v e r n m e n t p r o g r a m , e l d e r l y w o m a n t a k e n a d v a n t a g e o f . $ 3 8 , 2 9 6 . 8 8 S e n i o r h o m e o w n e r o n a fixedincome‐isbeing fo r c e d t o t r y t o f i n d a r e v e r s e m o r t g a g e i n o r d e r t o s t a y i n h e r h o m e. H e r m o n t h l y m o r t g a g e p a y m e n t w e n t u p $ 4 3 5 . 8 6 . S h e w a s m i s l e d . Ca s e R H E R O ‐ Ho m e o w n e r n e e d e d t o d o a q u i c k s a l e b e c a u s e o f a j o b t r a n s f e r . H o m e o w n e r w a s t o ld t h a t t h e m a n w h o s o l d t h e p r o d u c t t o h e r t h a t t h i s w a s a g o v e r n m e n t p r o g r a mandthatshewouldnothavetopaya di m e o u t o f p o c k e t . S h e w a s c o u n t i n g o n t h e $ 1 0 , 0 0 0 i n e q u i t y s h e w o u l d r e c e i v e a s p r o c e e d s f r o m t h e s a l e . I t w a s t h e o n l y m o n e y s h e h a d . S h e w a l k e d a w a y w i t h o n l y a f e w h u n d r e d d o l l a r s t o h e r n a m e . Ca s e S H E R O ‐ Pr i c e G o u g i n g ‐ $7 8 , 0 0 0 c h a r g e d f o r 2 3 t o n H V A C u n i t s b y O n e H o u r H e a t i n g a n d C o o l i n g . Ca s e T H V A C U n i t $ 8 , 0 0 0 ‐ Mi s r e p r e s e n t a t i o n ‐ Ho m e o w n e r s d i d n o t u n d e r s t a n d t h a t t h i s w a s l i e n i n p r i o r i t y o f t h e i r h o m e , r ec e i v e d a n o t i c e t h a t i m p l o r e d a c c o u n t w a s $ 1 7 0 0 s h o r t a n d m o n t h l y m o r t g a g epayments we n t u p b y $ 1 3 0 . T h i s i s n o t w h a t t h e y w e r e t o l d . T h e y w a n t t o s e l l t o m o v e i n t o a n a d u l t c o m m u n i t y , b u t t h e y c a n n o t b e c a u s e t h e c o s t t o p a y o f f t h e l i e n w i l l l ea v e t h e m w i t h n o t h i n g t o p u t d o w n o n a n e w h o m e . Ca s e U H E R O M o n t h l y m o r t g a g e p a y m e n t s i n c r e a s e d $ 3 7 8 . 2 8 . S t u c c o p a i n t a n d As t r o T u r f f o r $ 2 8 , 5 1 4 . H o m e o w n e r s c a n n o t s e l l o r a f f o r d t o s t a y i n t h e i r h o m e. Ca s e V H E R O ‐ Em b a r r a s s e d c l i e n t w a s t o l d p a y m e n t s w o u l d b e d e l a y e d a y e a r. H i s i m p o u n d a c c o u n t w a s i n t h e n e g a t i v e . H e w a s m i s l e d . Ca s e W H E R O ‐ Ap p r o x i m a t e l y 5 4 , 0 0 0 f o r m u l t i p l e i m p r o v e m e n t s . W a s a p p r o v e d f o r t h e l o a n wh i l e u n e m p l o y e d a n d t h e n h a d t o m o v e t o g e t a n e w j o b ( o i l i n d u s t r y ) . H e i s u p sidedownandtheonlyoptionisashort sa l e . Ca s e Z H E R O ‐ 14 1 0 9 W e l l i n g t o n h a s b e e n u p f o r s a l e s i n c e A u g u s t , 2 0 1 4 ‐ Ex p i r e d o r c a n c e l l e d l i s t i n g 4 t i m e s . L o o k s l i k e t h e f o l l o w i n g w a s d o n e i n 2 0 1 6 : R 4 8 i n s u l a t i o n T w o Z o n e d A C u n i t s S o l a r S y s t e m V a r i a b l e s p e e d po o l p u m p . I t w a s a l s o a s h o r t s a l e t h a t f a i l e d b e f o r e i t w e n t i n t o f o r e c l o s u r e . A n n u a l a s s e s s m e n t i s $ 3 9 2 2 . 5 2 . T o t a l o f s p e c i a l a s s e s s m e n t s p e r y e a r i s $7 8 2 7 . 5 2 . I f i t ' s a 1 0 y e a r c o n t r a c t t h e y s p e n t $ 3 9 , 2 2 5 . I n Ja n u a r y o f 2 0 1 6 , t h e y h a d a v a l u e a s s e s s m e n t r e d u c t i o n o f $ 1 4 2 , 2 0 5 . D r o p p e d f ro m $ 4 7 4 , 2 0 5 t o $ 3 3 2 , 0 0 0 . T h i s i s t h e s a m e y e a r t h e y s u p p o s e d l y h a d a 1 0 % e q ui t y p o s i t i o n o n a m o r t g a g e b a l a n c e o f $ 2 9 8 , 3 0 0 . T h e y al s o s h o w a 2 n d o f $ 1 0 , 0 0 0 . W o u l d h a v e p u t m a x a v a i l a b l e e q u i t y a r o u n d $ 3 3 , 2 00 . H e r o L i t e r a l l y s u c k e d u p e v e r y p e n n y a n d t h e n s o m e o f e q u i t y a t t h e t i m e . H om e o w n e r s l o s t h o u s e j u s t a f e w m o n t h s l a t e r . I t d i d no t s e l l a t a u c t i o n f o r m i n i m u m b i d o f $ 3 2 9 , 2 9 7 . S o n o w i s l i s t e d f o r $ 2 7 4 , 9 0 0 . an d h a s n o t s o l d . T h e n e i g h b o r s h a v e b e e n k e e p i n g u p t h e y a r d f o r t h e p a s t t w oy e a r s . HE R O W i n d o w s / R o o f $ 1 9 , 5 0 0 T w o t r a n s a c t i o n s . H o m e o w n e r p u r c h a s e d w i n d o w s o n a 5 y e a r t e r m . S h e t h e n p u r c h a s e d t h e r o o f a n d d i d n o t u n d e r s t a n d t h a t w a s g roupedintothefirstcontractwitha5year te r m . H e r m o n t h l y m o r t g a g e p a y m e n t h a s g o n e u p f r o m $ 1 1 0 0 t o $ 2 0 1 0 . S h e s a i d s h e w a s m i s l e d . S h e a l s o n o t e s t h a t t o m a k e a d d i t i o n a l p a y m e n t s o n t h e l o a n i t ha s t o b e a m i n i m u m o f $ 2 0 0 0 o r H E R O w o n ' t ac c e p t t h e a d d i t i o n a l p a y m e n t . HE R O S o l a r ‐ Mi s r e p r e s e n t a t i o n b y a n o u t o f t o w n c o n t r a c t o r . I t t o o k m o n t h s t o c o m p l e t e t h e w o r k p r o p e r l y t o b e g i n e n e r g y s a v i n g s . E v e r y t h i n g s e e m e d o k a y t h e f i r s t year,butthenthehomeownersmortgage co m p a n y s o l d t h e i r m o r t g a g e a n d t h e m o n t h l y m o r t g a g e p a y m e n t w e n t u p b y $ 5 0 0 p e r m o n t h i n s t e a d o f b e i n g a b l e t o p a y a t t h e e n d o f t h e y e a r w i t h t h e p r o p e r t y ta x e s . T h e y b e l i e v e t h e y w e r e l i e d t o . T h e y w e r e to l d t h a t t h e l i e n i s a s s u m a b l e . T h e y w e r e t o l d t h a t t h e y c o u l d m a k e a d d i t i o n al p a y m e n t s , b u t a r e n o w b e i n g t o l d t h a t t h e r e i s m i n i m u m p a y m e n t o f $ 5 0 0 0 o r HE R O w o n ' t a c c e p t t h e p a y m e n t . HE R O ‐ Wi n d o w s / W a t e r H e a t e r . H o m e o w n e r w a s n o t a b l e t o r e f i n a n c e b e c a u s e o f t h e H E R O l i e n . 1. Re c o m m e n d t h e f u l l C i t y C o u n c i l c o n t i n u e w i t h t h e P A C E pr o g r a m s a s i s . 2. Re c o m m e n d t h e P A C E p r o g r a m s c o n t i n u e f o r a s e t p e r i o d o f ti m e ( s u c h a s 9 0 – 1 8 0 d a y s ) t o i d e n t i f y i f s t a t e a n d / o r f e d e r a l re f o r m s r e m e d y t h e i s s u e s / c o n c e r n s r a i s e d . 3. Re c o m m e n d t e r m i n a t i o n o f t h e f i v e P A C E p r o g r a m s t o t h e fu l l C i t y C o u n c i l . 4. Se n d t h e i s s u e t o t h e f u l l C i t y C o u n c i l w i t h o u t a C o m m i t t e e re c o m m e n d a t i o n . 5. Mee t a g a i n a s a C o m m i t t e e o n t h i s i s s u e w h e n m o r e in f o r m a t i o n i s a s s e m b l e d . OFFICE OF THE CITY MANAGER MEMORANDUM May 30, 2017 TO: Budget and Finance Committee FROM: Chris Huot, Assistant City Manager CH SUBJECT: Item 4 A – Additional Public Comments Since the May 30th Budget and Finance packet was compiled and distributed, several pieces of correspondence and information have been received by the City Manager’s Office. These documents have been compiled and enclosed for your reference. In addition, City staff received an updated copy of Attachment F, which was e- mailed to Committee members on May 26, 2017 and is also provided herein. From:Alan Tandy To:Chris Huot; Christopher Gerry Subject:FW: Update from Renovate America Date:Friday, May 26, 2017 8:48:55 AM Another for tuesday From: Steven L. Teglia Sent: Friday, May 26, 2017 8:48 AM To: Dustin Reilich Cc: Alan Tandy; Andrew Heglund Subject: RE: Update from Renovate America Thanks for the update information Dustin. Steven L. Teglia Assistant City Manager City of Bakersfield (661) 326-3747 www.bakersfieldcity.us From: Dustin Reilich [mailto:dreilich@renovateamerica.com] Sent: Wednesday, May 24, 2017 6:52 PM To: Steven L. Teglia Subject: Update from Renovate America Steven, I wanted to reach out to share a series of actions we have publicly announced today. Please let me know if you have questions or comments. We are thoroughly committed to providing a strong Public-Private Partnership which puts the Homeowner at the center. Renovate America has implemented a series of changes to its home improvement financing platform to better support homeowners’ interests and to create a sustainable Property Assessed Clean Energy (PACE) industry. Among these changes are new consumer-friendly systems and tools, leadership re-alignments, and policy development for one of the most successful public-private partnership models for home improvement financing in the nation (PACE). The changes include: The development of an industry-first, data-driven Contractor Quality Rating system that has resulted in the suspension of more than 80 contractor firms – representing 10% of contractors regularly using Renovate America financing – and strengthening offerings for high-quality contractors. The hiring, after a nationwide search, of new Chief Financial Officer Paige Wisdom. Wisdom served as Chief Enterprise Risk Officer and EVP at Freddie Mac from 2010 to 2015, and is a board member of Morgan Stanley Bank NA. Wisdom served as CFO for key business units at Bank of America and has held leadership positions with Bank One Corporation/J.P. Morgan, and UBS/Swiss Bank. Most recently, she was CFO at Exeter Finance Corp, a specialty auto finance company. The appointment of new Chief Lending Officer and EVP Patrick Moore to bring best practices from the consumer financial services industry and lead all customer contact, credit-related processes, and lending strategy for Renovate America, including HERO, Benji, and Contractor Lending. Moore co-developed Benji, the company’s new unsecured home improvement credit product, slated for nationwide deployment this year. Moore served as COO of Genesis Financial Solutions, COO of Toyota F.S.B., and as Capital One’s Vice President of Customer Management. The realignment of the home improvement contractor network under EVP of Business & Client Development Greg Memo, whose responsibilities already included strategic partnerships with national accounts, manufacturing and distributor partners. The alignment of all marketing functions under SVP of Marketing Dan Stevenson, with a strong emphasis on digital strategy and the company’s new homeowner-facing online marketplace, RenovateAmerica.com. Efforts to develop a more robust legislative and regulatory framework for PACE at the state and federal levels, and to work with regional government bond-issuing entities to strengthen oversight. And other internal improvements to processes and products. Renovate America is also making the decision to fund future expansion and growth from profitability, thereby reducing dependency on outside capital and maintaining and increasing the privately held company’s value over the long run. These steps to improve the experience for its primary customer – homeowners – result in a temporary contraction of the company’s revenue base. Accordingly, the company is reducing its headcount from 640 to 532 employees. Renovate America continues to lead the PACE industry with operations in California, Missouri, and Florida, will deliver Benji financing through home improvement contractors in all 50 states by Q3 2017, and is building national interest in RenovateAmerica.com as a digital property connecting homeowners with information, tools, financing options, and quality contractors. Please let me know if you have any questions. Thanks Dustin Dustin Reilich | Senior Director – Municipal Development Cel:(949)237-0965 | 855-HERO-411 I 16620 W Bernardo Dr. San Diego, CA 92127 Renovate America, Inc. I Confidentiality Statement: The information in this message may be privileged and/or confidential and protected from disclosure. If the reader of this message is not the intended recipient, you are hereby notified that any dissemination, distribution or copy of this communication is strictly prohibited. If you have received this communication in error, please notify us immediately by replying to this message and deleting the material from any computer. Thank you. Kern County Taxpayers Association 1401 19th Street, Ste 200, Bakersfield, CA 93301 (661)322-2973 1 Documents/2017/Communications/PACE Program April 16, 2017 Supervisor Zack Scrivner and Members of the Board of Supervisors County of Kern 1115 Truxtun Avenue Bakersfield, CA 93301 Mayor Karen Goh and City Council Members City of Bakersfield 1600 Truxtun Avenue Bakersfield, CA 93301 RE: Kern Tax Position Concerning PACE Chairman Scrivner and Mayor Goh: KernTax has established a robust set of guideposts regarding taxes, fees and other governmental assessments that are obligations of our taxpayers. It is in alignment with our principles that any requirement that subordinates the first lien (i.e., the mortgage) is placed (as an obligation) in the same cash flow position as any tax. KernTax views any government collection of funds through any financial conduit to be taxation, be it clearly identified as a tax, a fee for government service or a fixed rate structure. If it is excessive or not appropriate, KernTax must, by charter, educate, expedite resolution and ensure fair representation and treatment. We do not seek subsidies; we are looking for fair a return to our local citizens from all regulatory bodies and their agents for levied taxes, or fees. KernTax cannot support the assignment of a tax-like burden levied for the benefit of private parties, in this case homeowners and environmentally driven contractors (even if established through negotiation). This assignment of responsibility while it may be fair in the context of payment for services should be relegated to other equally appropriate transactions and not levied as if determined through legislation or regulatory fiat. A reasoned person could argue that lenders will be less inclined to enter into financial terms where risk of subordination of their rights are high in the event of failure to pay the note payable. One could alter the question and ask would the city or county support such a program if it subordinated the taxes? The logical answer is no; the taxes are levied by duly approved taxing actions for the benefit of the public good. Kern County Taxpayers Association 1401 19th Street, Ste 200, Bakersfield, CA 93301 (661)322-2973 2 Documents/2017/Communications/PACE Program The notion that single private transactions have the same benefit is hard to assess on a specific installation basis. Cost-benefit analysis would have to presume a reasonable return in the same vein as utility capital expenditures. However, this is no regulated market where the general community is assured that the individual home improvement transactions are justly priced when risk of a poor financial transaction is assigned to a tax-like position as opposed to a lender’s assessment of a home improvement loan as a second lien. Will we see more synthetic tax-like structures for whatever the state and lobbyists want but haven’t money or legislative will to tax? KernTax cannot ignore this issue and take our rightly guided positions concerning generally assigned taxes which we oppose without proper review and knowing consent. We believe that efforts to mitigate the problems created by the well-meaning PACE program yield some improvement but potential price gouging, gold plating, bankruptcy conflicts, taxations issues, foreclosure issues would not exist if the PACE program did not create them. This synthetic financing instrument created as policy without consideration to normal home buying practices allows a person who otherwise could not and arguably should not borrow to buy environmentally desired installations to obligate themselves and future purchasers to a non-market payment structure that may have been priced far above reasonable market prices had the installation been subject to a review for home improvement. Over priced home improvements will lower resell values and lead to more foreclosures and the gradual de-gentrification of neighborhoods as homes go on the market and remain unsellable due to the PACE burden. If the program is to remain in place and since this has regulatory overtones, we advocate for a regulated model with truth in lending with mandated open book deals (at cost plus 12%) with a posted price comparison for similar projects done without PACE money or require three competitive bids with a signoff from the first lien holder. We also believe the taxing agency should be obligated to hold the first lien holder and their assigns harmless and not pass the obligation on to others. Respectfully, Michael Turnipseed Executive Director     From:Alan Tandy To:Chris Huot; Christopher Gerry Subject:FW: Keep HERO in Kern County Date:Friday, May 26, 2017 10:41:13 AM For late packet From: Shane Ellis [mailto:sellis@sunfinitysolar.com] Sent: Friday, May 26, 2017 10:41 AM To: Alan Tandy Subject: Keep HERO in Kern County Dear City Manager Alan Tandy, These homeowners are loosing their homes because they are not paying their bills. Same reason if they purchased a home they couldn't afford. PACE is the only way about 80% of Bakersfield home owners can get qualified for Solar/Windows to lower their energy bills & increase their equity. The realtors hate PACE because they have to sell the home and it takes a couple more steps. Homeowners can take out the equity on their home to pay it off if needed. If PG&E is behind then I will protest as well! Regards, Shane Ellis sellis@sunfinitysolar.com From:Alan Tandy To:Christopher Gerry; Chris Huot Subject:FW: Keep HERO in Kern County Date:Tuesday, May 30, 2017 7:50:47 AM     From: James Parsons [mailto:cparsons3@bak.rr.com] Sent: Sunday, May 28, 2017 1:02 PM To: Alan Tandy Subject: Keep HERO in Kern County Dear City Manager Alan Tandy, The Hero program was something I'd never heard of before. When it was explained to me by our A/C company when our A/C went out, I was thrilled as I did not have to fork out $30,000 up front for a whole new system, now I make those two payments a year and I couldn't be more happy that I didn't have to drain my savings right before summer for a new A/C system. We have recommended this programme to most of our Neighbours, and will continue to do so as we have not had any negative experiences at all with hero. Regards, James Parsons cparsons3@bak.rr.com Ad d r e s s I m p r o v e m e n t / L e n d e r / N o t e s Ca s e A H E R O / P a i n t / $ 1 0 , 0 0 0 - B e s t V a l u e H o m e R e m o d e l - M a r k G r e e n . T r i e d t o s e l l h o m e b u t r e c e i v e d n o o f f e r s … h o m e s t i l l o n t h e m a rk e t … s e v e r a l a t t e m p t s t o g e t a h o l d o f H E R O , h a v e b e e n w a i t i n g a m o n t h f o r a c a l l ba c k … i m p r o v e m e n t s a r e f a i l i n g - P a i n t i s p e e l i n g Ca s e B H E R O - B o u g h t a h o t w a t e r h e a t e r , n o t a s e f f i c i e n t a s t h e y t h o u g h , h a d s o m e h e a l t h i s s u e s , h a v e n t p a i d m o r t g a g e i n t w o m o n t hs a s o f 5 / 2 0 . T h e y a r e n o t s a v i n g m o n e y o n t h e e n e r g y b i l l . Ca s e C H E R O - $ 2 0 , 0 0 0 w i n d o w s , d o o r s , d o g g y d o o r - T r y i n g t o s e l l t h e h o m e , b u y e r s w o n ' t e v e n c o n s i d e r b u y i n g w i t h t h e l e i n o n t h e h o m e Ca s e D H E R O - $ 2 6 , 0 0 0 i n w i n d o w s Ca s e E Y G R E N E 2 4 , 0 0 0 R V P a r k i n g a n d P a t i o m i s l e d r e g a r d i n g h o w t h e p a y m e n t s w o u l d b e m a d e , t h e y h a d d i f f i c u l t y i n r e f i n a n c i n g a nd h a d t o p a y t h e l i e n o f f i n o r d e r t o r e f i n a n c e Ca s e F H E R O R o o f / $ 2 4 , 0 0 0 I n t e r e s t R a t e 8 . 9 5 f o r 2 0 y e a r s . M i s r e p r e s e n a t i o n a n d p r i c e g o u g i n g . B e h i n d o n h e r m o r t g a g e - p a y m e n t s w e n t u p f r o m 1 1 8 7 . 9 3 t o 1 6 7 2 . 2 5 - h a s c a n c e r a n d i s o n a f i x e d i n c o m e - t r y i n g t o f i l e b a n k r u p t c y , bu t c a n n o t b e c a u s e s h e i s b e h i n d o n t h e m o r t g a g e p a y m e n t . T h e f a m i l y c a n n o t e v e n b u y g r o c e r i e s a t t h i s p o i n t . Ca s e G H E R O - w a s t r a n s f e r r e d d u r i n g t h e s a l e w i t h o u t k n o w l e d g e o r c o n s e n t - O n e y e a r l a t e r m o n t h l y m o r t g a g e p a y m e n t w e n t u p b y $ 20 0 p e r m o n t h . O w n e r c a n n o t a f f o r d . T h i s c a s e i s c u r r e n t l y i n m e d i a t i o n a n d m a y n e e d t o b e ha n d l e d i n c o u r t . Ca s e H H E R O - f o r w i n d o w s w a s t r a n s f e r r e d d u r i n g t h e s a l e w i t h o u t k n o w l e d g e o r c o n s e n t - O n e y e a r l a t e r m o n t h l y m o r t g a g e p a y m e n t we n t u p b y $ 2 0 0 p e r m o n t h . O w n e r c a n n o t a f f o r d . T h i s c a s e i s c u r r e n t l y i n m e d i a t i o n a n d m a y ne e d t o b e h a n d l e d i n c o u r t . Ca s e I H E R O - $ 3 6 , 6 8 5 f o r H V A C u n i t , n e w d u c t s , e n e r g y e f f i c i e n t w i n d o w s a n d s l i d i n g g l a s s d o o r s . H o m e o w n e r s a r e v e t e r a n s . V A a t t h e t i m e d i d n o t u n d e r s t a n d P A C E w e l l . V e t e r a n s n o w n e e d t o s e l l f o r p e r s o n a l r e a s o n s , b u t w i l l ha v e t o p a y o f f t h e l o a n i n o r d e r t o d o s o . T h e y h a d n o w a y o f a n t i c i p a t i n g t h i s t u r n o f e v e n t s a n d i t h a s c a u s e d a g r e a t d e a l fi n a n c i a l a n d e m o t i o n a l s t r e s s a n d h a r m . Ca s e J H E R O - $ 4 7 , 2 3 4 I n t e r e s t r a t e 1 0 . 5 2 % Ca s e K H E R O P a i n t - B e s t V a l u e H o m e I m p r o v e m e n t s - P r o g r a m M i s r e p r e s e n t a t i o n - s p a n i s h s p e a k i n g - e l d e r l y - c a n n o t a f f o r d m o n t h l y i n cr e a s e i n m o r t g a g e p a y m e n t s Ca s e L Y G R E N E - H V A C $ 8 0 0 0 - C o m p l a i n t i s p r i c e g o u g i n g m i s r e p r e s e n a t i o n o f a g o v e r n m e n t p r o g r a m a n d d i d n o t e x p l a i n l i e n s t a t u s . Ca s e M H E R O - $ 3 8 , 2 7 6 . 2 5 H V A C , W i n d o w s , E x t e r i o r D o o r s , P r e - p a y m e n t p e n a l t y o f 5 . 3 % . C o m p l a i n t i s p r i c e g o u g i n g , h i g h f e e s a n d i n te r e s t . M i s r e p r e s e n t a t i o n o f t h e p r o g r a m . Ca s e N H V A C U n i t $ 1 2 , 0 0 0 P r i c e G o u g i n g a n d p r o p e r t y f a i l e d t o s e l l d u e t o a s s e s s m e n t p a y o f f . Ca s e P Y G R E N E - H V A C - C o m p l a i n t i s p r i c e g o u g i n g m i s r e p r e s e n a t i o n o f a g o v e r n m n e t p r o g r a m Ca s e Q Y G R E N E - S h a r p C o n s t r u c t i o n - P e e p h o l e , w i n d o w s , r o o f . M i s r e p r e s e n t a t i o n , w a s t o l d i t w a s g o v e r n m e n t p r o g r a m , e l d e r l y w o m a n t a k e n a d v a n t a g e o f . $ 3 8 , 2 9 6 . 8 8 S e n i o r h o m e o w n e r o n a f i x e d i n c o m e - i s b e i n g f o r c e d t o t r y to f i n d a r e v e r s e m o r t g a g e i n o r d e r t o s t a y i n h e r h o m e . H e r m o n t h l y m o r t g a g e p a y m e n t w e n t u p $ 4 3 5 . 8 6 . S h e w a s m i s l e d . Ca s e R H E R O - H o m e o w n e r n e e d e d t o d o a q u i c k s a l e b e c a u s e o f a j o b t r a n s f e r . H o m e o w n e r w a s t o l d t h a t t h e m a n w h o s o l d t h e p r o d u c t t o h e r t h a t t h i s w a s a g o v e r n m e n t p r o g r a m a n d t h a t s h e w o u l d n o t h a v e t o p a y a d i m e ou t o f p o c k e t . S h e w a s c o u n t i n g o n t h e $ 1 0 , 0 0 0 i n e q u i t y s h e w o u l d r e c i e v e a s p r o c e e d s f r o m t h e s a l e . I t w a s t h e o n l y m o n e y s h e h a d . S h e w a l k e d a w a y w i t h o n l y a f e w h u n d r e d d o l l a r s t o h e r n a m e . Ca s e S H E R O - P r i c e G o u g i n g - $ 7 8 , 0 0 0 c h a r g e d f o r 2 3 t o n H V A C u n i t s b y O n e H o u r H e a t i n g a n d C o o l i n g . Ca s e T H V A C U n i t $ 8 , 0 0 0 - M i s r e p r e s e n a t i o n - H o m e o w n e r s d i d n o t u n d e r s t a n d t h a t t h i s w a s l i e n i n p r i o r i t y o f t h e i r h o m e , r e c e i v e d a n o t i c e t h a t i m p o r u d a c c o u n t w a s $ 1 7 0 0 s h o r t a n d m o n t h l y m o r t g a g e p a y m e n t s w e n t u p b y $ 1 3 0 . Th i s i s n o t w h a t t h e y w e r e t o l d . T h e y w a n t t o s e l l t o m o v e i n t o a n a d u l t c o m m u n i t y , b u t t h e y c a n n o t b e c a u s e t h e c o s t t o p a y o f f th e l i e n w i l l l e a v e t h e m w i t h n o t h i n g t o p u t d o w n o n a n e w h o m e . Ca s e U H E R O M o n t h l y m o r t g a g e p a y m e n t s i n c r e a s e d $ 3 7 8 . 2 8 . S t u c c o p a i n t a n d a s t r o t u r f f o r $ 2 8 , 5 1 4 . H o m e o w n e r s c a n n o t s e l l o r a f f o r d t o s t a y i n t h e i r h o m e . Ca s e V H E R O - E m b a r r a s s e d c l i e n t w a s t o l d p a y m e n t s w o u l d b e d e l a y e d a y e a r . H i s i m p o u n d a c c o u n t w a s i n t h e n e g a t i v e . H e w a s m i s l ed . Ca s e W H E R O - A p p r o x i m a t e l y 5 4 , 0 0 0 f o r m u l t i p l e i m p r o v e m e n t s . W a s a p p r o v e d f o r t h e l o a n w h i l e u n e m p l o y e d a n d t h e n h a d t o m o v e t o ge t a n e w j o b ( o i l i n d u s t r y ) . H e i s u p s i d e d o w n a n d t h e o n l y o p t i o n i s a s h o r t s a l e . Ca s e Z H E R O - 1 4 1 0 9 W e l l i n g t o n h a s b e e n u p f o r s a l e s i n c e A u g u s t , 2 0 1 4 - E x p i r e d o r c a n c e l l e d l i s t i n g 4 t i m e s . L o o k s l i k e t h e f ol l o w i n g w a s d o n e i n 2 0 1 6 : R 4 8 i n s u l a t i o n T w o Z o n e d A C u n i t s S o l a r S y s t e m V a r i a b l e s p e e d p o o l p u m p . I t wa s a l s o a s h o r t s a l e t h a t f a i l e d b e f o r e i t w e n t i n t o f o r e c l o s u r e . A n n u a l a s s e s s m e n t i s $ 3 9 2 2 . 5 2 . T o t a l o f s p e c i a l a s s e s s m e n t s pe r y e a r i s $ 7 8 2 7 . 5 2 . I f i t ' s a 1 0 y e a r c o n t r a c t t h e y s p e n t $ 3 9 , 2 2 5 . I n J a n u a r y o f 2 0 1 6 , t h e y h a d a va l u e a s s e s s m e n t r e d u c t i o n o f $ 1 4 2 , 2 0 5 . D r o p p e d f r o m $ 4 7 4 , 2 0 5 t o $ 3 3 2 , 0 0 0 . T h i s i s t h e s a m e y e a r t h e y s u p p o s e d l y h a d a 1 0 % e q u it y p o s i t i o n o n a m o r t g a g e b a l a n c e o f $ 2 9 8 , 3 0 0 . T h e y a l s o s h o w a 2 n d o f $ 1 0 , 0 0 0 . W o u l d ha v e p u t m a x a v a i l a b l e e q u i t y a r o u n d $ 3 3 , 2 0 0 . H e r o L i t e r a l l y s u c k e d u p e v e r y p e n n y a n d t h e n s o m e o f e q u i t y a t t h e t i m e . H o m e o w n er s l o s t h o u s e j u s t a f e w m o n t h s l a t e r . I t d i d n o t s e l l a t a u c t i o n f o r m i n i m u m b i d o f $3 2 9 , 2 9 7 . S o n o w i s l i s t e d f o r $ 2 7 4 , 9 0 0 . a n d h a s n o t s o l d . T h e n e i g h b o r s h a v e b e e n k e e p i n g u p t h e y a r d f o r t h e p a s t t w o y e a r s . HE R O W i n d o w s / R o o f $ 1 9 , 5 0 0 T w o t r a n s a c t i o n s . H o m e o w n e r p u r c h a s e d w i n d o w s o n a 5 y e a r t e r m . S h e t h e n p u r c h a s e d t h e r o o f a n d d i d no t u n d e r s t a n d t h a t w a s g r o u p e d i n t o t h e f i r s t c o n t r a c t w i t h a 5 y e a r t e r m . H e r mo n t h l y m o r t g a g e p a y m e n t h a s g o n e u p f r o m $ 1 1 0 0 t o $ 2 0 1 0 . S h e s a i d s h e w a s m i s l e d . S h e a l s o n o t e s t h a t t o m a k e a d d i t i o n a l p a y m e nt s o n t h e l o a n i t h a s t o b e a m i n i m u m o f $ 2 0 0 0 o r H E R O w o n ' t a c c e p t t h e a d d i t i o n a l pa y m e n t . HE R O S o l a r - M i s r e p r e s e n t a t i o n b y a n o u t o f t o w n c o n t r a c t o r . I t t o o k m o n t h s t o c o m p l e t e t h e w o r k p r o p e r l y t o b e g i n e n e r g y s a v i n g s. E v e r y t h i n g s e e m e d o k a y t h e f i r s t y e a r , b u t t h e n t h e h o m e o w n e r s m o r t g a g e c o m p a n y so l d t h e i r m o r t g a g e a a n d t h e m o n t h l y m o r t g a g e p a y m e n t w e n t u p b y $ 5 0 0 p e r m o n t h i n s t e a d o f b e i n g a b l e t o p a y a t t h e e n d o f t h e ye a r w i t h t h e p r o p e r t y t a x e s . T h e y b e l i e v e t h e y w e r e l i e d t o . T h e y w e r e t o l d t h a t t h e li e n i s a s s u m a b l e . T h e y w e r e t o l d t h a t t h e y c o u l d m a k e a d d i t i o n a l p a y m e n t s , b u t a r e n o w b e i n g t o l d t h a t t h e r e i s m i n i m u m p a y m e n t o f $ 5 0 0 0 o r H E R O w o n ' t a c c e p t t h e p a y m e n t . HE R O - W i n d o w s / W a t e r H e a t e r . H o m o w n e r w a s n o t a b l e t o r e f i n a n c e b e c a u s e o f t h e H E R O l i e n . The following documents were provided by the Bakersfield Association of Realtors Letters In Support Of Repealing General Information Local Media Third Party Opposition Frequently Asked Questions The following documents were provided by the PACE Providers The following documents were provided by individuals who attended the meeting