11 - Expansion of Property Assessed Clean Energy Program

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existing and new customers in addressing an almost universal pent-up demand for needed commercial and industrial property equipment modernization. In order to protect the interests of holders of existing mortgage loans on the property, the PACE Act requires their written consent to the PACE assessment as a condition to obtaining a PACE loan. 6. The Benefits of PACE to Contractors, Engineers, and Manufacturers PACE loans provide attractive sources of financing for water and energy saving retrofits and upgrades, thereby encouraging property owners to make substantial investments in existing commercial and industrial buildings. As a result, PACE will unlock business opportunities for contractors, engineers, and manufacturers throughout the commercial and industrial sectors. 7. Administration of the Local Government PACE Program Under the PACE Act, the establishment and operation of the program are considered to be governmental functions.' The PACE Act further authorizes the Local Government to enter into a contract with a third party to provide administrative services for the PACE program (the "Authorized Representative'. The Local Government will delegate administration of the PACE program to Texas PACE Authority, a qualified, non-profit organization that can administer the program at no cost to the Local Government. The Authorized Representative's role is to serve as an extension of the local government staff to provide oversight of the program to ensure best practices and consumer protections at the lowest possible cost to the property owner in a transparent and ethical manner and to provide education and outreach. The Authorized Representative will be funded by administrative fees paid by the property owners establishing a PACE project, charitable grants or other authorized sources of revenue. The Authorized Representative will not receive compensation or reimbursement from the Local Government. 8. Eligible Lenders The PACE Act does not set criteria for financial institutions or investors to be PACE lenders. The Local Government will follow best practices of other PACE programs and the Texas PACE in a Box model program by recommending that lenders be: IN Any federally insured depository institution such as a bank, savings bank, savings and loan association and federal or state credit union; ■ Any insurance company authorized to conduct business in one or more states; ■ Any registered investment company, registered business development company, or a Small Business Administration small business investment company; ■ Any publicly traded entity; or ■ Any private entity that: o Has a minimum net worth of $5 million; and TX Local Government Code §399.003(b) 4