CITY OF DANA POINT AGENDA REPORT

Transcription

1 10/18/16 Page 1 Item #5 CITY OF DANA POINT AGENDA REPORT Reviewed By: DH X CM X CA DATE: OCTOBER 18, 2016 TO: FROM: SUBJECT: CITY MANAGER/CITY COUNCIL MIKE KILLEBREW, ASSISTANT CITY MANAGER CONSIDERATION OF RESOLUTION OF THE CITY OF DANA POINT OF CONSENTING TO THE INCLUSION OF PROPERTIES WITHIN THE TERRITORY OF THE CITY OF DANA POINT IN THE CSCDA OPEN PACE PROGRAM; AND OTHER MATTERS RELATED THERETO. RECOMMENDED ACTION: That the City Council adopt a Resolution entitled: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DANA POINT, CALIFORNIA CONSENTING TO THE INCLUSION OF PROPERTIES WITHIN THE TERRITORY OF THE CITY OF DANA POINT IN THE CSCDA OPEN PACE PROGRAM. DISCUSSION: The California Statewide Communities Development Authority (CSCDA) was created in 1988, under California s Joint Exercise of Powers Act, to provide California s local governments with an effective tool for the timely financing of community-based public benefit projects. CSCDA is the largest Joint Powers Authority in California with over 500 member agencies, including the City of Dana Point, and is sponsored by the League of California Cities and the California State Association of Counties. CSCDA implemented a Property Assessed Clean Energy ( PACE ) program under the provisions of Chapter 29 of Division 7 of the California Streets & Highways Code ( AB 811 ) on behalf of its member counties and cities. AB811 authorized a legislative body to designate an area within which willing private property owners may enter into voluntary contractual assessments to finance the installation of renewable energy, energy efficiency, water efficiency, and seismic improvements, as well as electric vehicle charging infrastructure, in each case affixed to real property (the Improvements ). CSCDA vetted, pre-qualified and appointed companies to administer CSCDA s Open PACE program offers CSCDA members turn-key PACE solutions. The program provides residential and commercial property owners a choice among prequalified PACE program

2 10/18/16 Page 2 Item #5 administrators, which creates competition on terms, service and interest rates. CSCDA s current program administrators include the following: - AllianceNRG Program (consisting of Deutsche Bank Securities Inc., CounterPointe Energy Solutions LLC and Leidos Engineering, LLC); - PACE Funding LLC; and, - Renewable Funding LLC (administering CaliforniaFIRST). CSCDA s Open PACE program offers solutions that save California jurisdictions the time and resources needed to develop standalone PACE programs. To allow CSCDA to offer the program in Dana Point, the City Council must adopt a resolution in the form of the one attached to this report (see Attachment A). PACE is operating in over 250 jurisdictions throughout the state (see Attachment B for list of CSCDA participating jurisdictions). Private property owner participation is voluntary. The improvements must be installed by pre-qualified contractors and must meet Federal and/or State performance standards. The funding comes from debt issued by CSCDA, and that debt is secured by the assessment levied on the owner s property. Under State law, a PACE assessment stays with the property upon transfer of ownership, unlike most private loans which are due and payable on sale of the property. Certain mortgage providers will require the assessment be paid at the time the property is refinanced or sold so that a PACE lien is not in a priority position over the mortgage being offered. As in other special assessment financings, the City is not obligated to repay debt or to pay any delinquent assessments levied on the participating private properties. PACE programs in general have experienced issues since the program was established, and there have been many news reports highlighting those issues. City Staff has met many times over the past 8 years with PACE program administrators, and has watched with interest the evolution of the program. To date Staff has been reluctant to recommend participation in the program, particularly due to what in our opinion was deficient loan disclosure standards and some misleading marketing materials. The industry has matured, and with recently enacted State legislation mandating certain consumer protections (see Attachment C), Staff is ready to recommend implementing the program. CSCDA adopted similar policies prior to the legislation being enacted Note also that the City is a member of CSCDA, and trusts that it has policies and procedures in place to provide effective oversight of their Open Pace program. The Orange County Association of Realtors (OCAR) sent out a letter dated August 1, 2016 announcing their position in regards to PACE programs. Staff asked CSCDA to respond to OCAR s letter. Both are included in Attachment D. CSCDA will be responsible for entering into voluntary contractual assessment agreements with participating property owners, levying the voluntary contractual assessments, issuing bonds to finance the Improvements and taking remedial actions in the event of delinquent assessment payments. The resolution expressly provides that the

3 10/18/16 Page 3 Item #5 City will not be responsible for the conduct of any assessment proceedings, the levy of assessments, any required remedial action in the case of delinquencies in assessment payments, or the issuance, sale or administration of any bonds issued in connection with CSCDA Open PACE. ENVIRONMENTAL IMPACT: This action is not considered a project under the California Environmental Quality Act, because the action does not involve any commitment to a specific project which may result in a potentially significant physical impact on the environment, as contemplated by Title 14, California Code of Regulations, Section 15378(b)(4). Therefore no negative environmental impact is noted. NOTIFICATION AND FOLLOW-UP: Secretary of the Board California Statewide Communities Development Authority 1400 K Street Sacramento, CA FISCAL IMPACT: No fiscal impact to the City of Dana Point will be incurred by consenting to the inclusion of properties within the City limits in the CSCDA Open PACE. All CSCDA Open PACE administrative costs are covered through an initial administrative fee included in the property owner s voluntary contractual assessment and an annual administrative fee, which is also collected on the property owner s tax bill. ALTERNATIVE ACTIONS: As determined by Council. ACTION DOCUMENTS: PAGE: A. Resolution consenting to inclusion of Dana Point properties in the CSCDA Open Pace Programs.4 SUPPORTING DOCUMENTS: B. List of CSCDA Participating Jurisdictions 7 C. Residential OPEN Pace Consumer Protection Policies 9 D. Response to Orange County Association of Realtors (OCAR) Letter & Policy Statement Opposing PACE Financing Programs.19 E. CaliforniaFIRST Sample Financing Packet...29

4 10/18/16 Page 4 Item #5 ACTION DOCUMENT A RESOLUTION NO XX A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DANA POINT, CALIFORNIA CONSENTING TO THE INCLUSION OF PROPERTIES WITHIN THE TERRITORY OF THE CITY OF DANA POINT IN THE CSCDA OPEN PACE PROGRAMS; AUTHORIZING THE CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY TO ACCEPT APPLICATIONS FROM PROPERTY OWNERS, CONDUCT CONTRACTUAL ASSESSMENT PROCEEDINGS AND LEVY CONTRACTUAL ASSESSMENTS WITHIN THE TERRITORY OF THE CITY OF DANA POINT; AND AUTHORIZING RELATED ACTIONS. WHEREAS, the California Statewide Communities Development Authority (the Authority ) is a joint exercise of powers authority, the members of which include numerous cities and counties in the State of California, including the City of Dana Point (the City ); and WHEREAS, the Authority is implementing Property Assessed Clean Energy (PACE) programs, which it has designated CSCDA Open PACE, consisting of CSCDA Open PACE programs each administered by a separate program administrator (collectively with any successors, assigns, replacements or additions, the Programs ), to allow the financing or refinancing of renewable energy, energy efficiency, water efficiency and seismic strengthening improvements, electric vehicle charging infrastructure and such other improvements, infrastructure or other work as may be authorized by law from time to time (collectively, the Improvements ) through the levy of contractual assessments pursuant to Chapter 29 of Division 7 of the Streets & Highways Code ( Chapter 29 ) within counties and cities throughout the State of California that consent to the inclusion of properties within their respective territories in the Programs and the issuance of bonds from time to time; and WHEREAS, the program administrators currently active in administering Programs are the AllianceNRG Program (presently consisting of Deutsche Bank Securities Inc., CounterPointe Energy Solutions LLC and Leidos Engineering, LLC), PACE Funding LLC and Renewable Funding LLC, and the Authority will notify the City in advance of any additions or changes; and WHEREAS, Chapter 29 provides that assessments may be levied under its provisions only with the free and willing consent of the owner or owners of each lot or parcel on which an assessment is levied at the time the assessment is levied; and WHEREAS, the City desires to allow the owners of property ( Participating Property Owners ) within its territory to participate in the Programs and to allow the Authority to

5 10/18/16 Page 5 Item #5 conduct assessment proceedings under Chapter 29 within its territory and to issue bonds to finance or refinance Improvements; and WHEREAS, the territory within which assessments may be levied for the Programs shall include all of the territory within the City of Dana Point official boundaries; and WHEREAS, the Authority will conduct all assessment proceedings under Chapter 29 for the Programs and issue any bonds issued in connection with the Programs; and WHEREAS, the City will not be responsible for the conduct of any assessment proceedings; the levy of assessments; any required remedial action in the case of delinquencies in such assessment payments; or the issuance, sale or administration of any bonds issued in connection with the Programs; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Dana Point as follows: Section 1. This City Council hereby finds and declares that properties in the territory of the City of Dana Point will benefit from the availability of the Programs within the territory of the City and, pursuant thereto, the conduct of special assessment proceedings by the Authority pursuant to Chapter 29 and the issuance of bonds to finance or refinance Improvements. Section 2. In connection with the Programs, the City hereby consents to the conduct of special assessment proceedings by the Authority pursuant to Chapter 29 on any property within the territory of the City and the issuance of bonds to finance or refinance Improvements; provided, that (1) The Participating Property Owners, who shall be the legal owners of such property, execute a contract pursuant to Chapter 29 and comply with other applicable provisions of California law in order to accomplish the valid levy of assessments; and (2) The City will not be responsible for the conduct of any assessment proceedings; the levy of assessments; any required remedial action in the case of delinquencies in such assessment payments; or the issuance, sale or administration of any bonds issued in connection with the Programs. Section 3. The appropriate officials and staff of the City are hereby authorized and directed to make applications for the Programs available to all property owners who wish to finance or refinance Improvements; provided, that the Authority shall be responsible for providing such applications and related materials at its own expense. The following staff persons, together with any other staff persons chosen by the City Manager of the City from time to time, are hereby designated as the contact persons for the Authority in connection with the Programs: Administrative Services Director.

6 10/18/16 Page 6 Item #5 Section 4. The appropriate officials and staff of the City are hereby authorized and directed to execute and deliver such certificates, requisitions, agreements and related documents as are reasonably required by the Authority to implement the Programs. Section 5. The City Council hereby finds that adoption of this Resolution is not a project under the California Environmental Quality Act, because the Resolution does not involve any commitment to a specific project which may result in a potentially significant physical impact on the environment, as contemplated by Title 14, California Code of Regulations, Section 15378(b)(4). Section 6. This Resolution shall take effect immediately upon its adoption. The City Clerk is hereby authorized and directed to transmit a certified copy of this resolution to the Secretary of the Authority at: Secretary of the Board, California Statewide Communities Development Authority, 1400 K Street, Sacramento, CA PASSED, APPROVED AND ADOPTED this 18th day of October, ATTEST: KATHY M. WARD, CITY CLERK JOHN A. TOMLINSON, MAYOR STATE OF CALIFORNIA ) COUNTY OF ORANGE ) ss. CITY OF DANA POINT ) I, Kathy M. Ward, City Clerk of the City of Dana Point, do hereby certify that the foregoing Resolution No XX was duly adopted and passed at a regular meeting of the City Council on the 18th day of October, 2016, by the following roll-call vote, to wit: AYES: NOES: ABSENT: ABSTAIN: KATHY M. WARD, CITY CLERK

7 10/18/16 Page 7 Item #5 SUPPORTING DOCUMENT B CSCDA OPEN PACE PARTICIPANTS Adelanto Albany Arcata Azusa Barstow Belmont Belvedere Benicia Berkeley Big Bear Lake Brisbane Buena Park Burlingame Campbell Carlsbad Chico Chino Chino Hills Citrus Heights Claremont Clovis Colma Colton Concord Corcoran Danville Dinuba El Cajon El Centro El Cerrito El Monte Escondido Eureka Fairfax Fontana Foster City Fremont Glendale Hanford Hayward Hercules Hesperia Highland Imperial Imperial Beach Ione La Mesa La Verne Lafayette Laguna Hills Lancaster Larkspur Lemoore Lindsay Lodi Los Angeles Los Banos Madera Manteca Mill Valley Montclair Moraga Moreno Valley Mt Shasta Napa National City Novato Oakland Oceanside Ontario Orland Oroville Pacifica Palm Desert Palmdale Paradise Piedmont Pinole Placerville Porterville Portola Valley Poway Rancho Cucamonga Rancho Mirage Redlands Redwood City Rialto Richmond Sacramento San Anselmo San Carlos San Diego San Jacinto San Mateo

8 10/18/16 Page 8 Item #5 City s Continued San Rafael San Ramon Santa Monica Sausalito Selma South Lake Tahoe Stanton Thousand Oaks Tiburon Tracy Tulare Ukiah Union City Vallejo West Hollywood Yreka Yuba City Counties Alameda Butte El Dorado Humboldt Kern Madera Marin Mono Monterey Napa Riverside Sacramento San Bernardino San Diego San Mateo Yuba

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