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An Ordinance Creating a PACE Area and Establishing the Illinois Finance Authority Property Assessed Clean Energy Program for Record Owners of Property that, From Time to Time, May Voluntarily Request the Levy of Special Assessments to Secure the Financing or Refinancing of their PACE Projects; Authorizing Program Administrators to Act Thereunder; Designating the Illinois Finance Authority as the Sole Issuer of Bonds and Notes; and Approving Related Matters.
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Introduction
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The purpose of this agenda item is for the Board to approve an Ordinance that creates a PACE area and establishes the Illinois Finance Authority Property Assessed Clean Energy Program.
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Recommended Action
Adopt the Ordinance.
Prior Board Action
There is no prior Board action associated with this item.
Background
Commercial Property Assessed Clean Energy (C-PACE) is a financing mechanism that allows owners of commercial and certain other properties to finance energy, water, resiliency, and renewable energy projects through long-term, fixed-rate assessment liens on their property. The Illinois Finance Authority (IFA) has been running a C-PACE financing program since 2013.
Any interested municipality may establish the IFA’s C-PACE Program within its boundaries by adopting the enabling PACE Ordinance. Enabling PACE makes this financing available to properties in the Village at no cost to the Village. Currently, eligible properties in Oak Park can participate in C-PACE financing through a Cook County-authorized program. Establishing the IFA PACE Program will not reduce or remove access to the Cook County PACE program. To date, no Oak Park properties have taken advantage of the Cook County program.
C-PACE financing may be used to finance up to the full amount of an eligible project, not to exceed 25% of the value of the property. Eligible improvements include fixtures, products, systems, equipment, devices, and materials intended for energy efficiency, renewable energy, resiliency, water efficiency, and electric vehicle charging. C-PACE financing is non-recourse to the record owner and assignable upon transfer of the property. C-PACE financing does not accelerate upon a default (payment or otherwise), permits terms of up to 40 years, and allows financing of up to 100% of all project and closing costs.
If the IFA PACE Program is established in the Village, the Village will have no risk or liability, operational responsibilities, and there will be no use of Village public funds. Each PACE Project Administrator provides an indemnity with respect to its activities and is required to maintain insurance policies under which the Village would be an additional insured. For each PACE Project completed, the IFA will provide the Village with a summary of the PACE Project and its estimated annual impact on energy and water savings.
Adopting this Ordinance helps achieve Energy Use in Buildings & Housing Goal #4 of the CROP plan: Establish Programs to Support Building Decarbonization. Specifically, action BD01 states, “Conduct a feasibility analysis of establishing an Oak Park Green Bank, Residential PACE program, or other local financing program.” Because the Illinois Finance Authority is the Illinois Climate Bank, residential PACE is not authorized in the State of Illinois, and Commercial PACE can support improvements in multifamily buildings (representing nearly half of Oak Park residential households) staff proposes that adopting this ordinance achieves the intention of goal BD01. Promotion of the program will further achieve BD04: “Implement an outreach and technical assistance program to increase the number of commercial and institutional buildings participating in the Cook County Commercial Property Assessed Clean Energy (C-PACE) program.” This item also relates to the 2026-2027 Village Board Goal of Sustainability and Resilience Priority 1g: Work with large building owners and develop programs to increase energy efficiency and electrification, including increasing compliance with the benchmarking ordinance, evaluating building performance standards, evaluating the adoption of the Illinois Finance Authority’s C-PACE ordinance, and creating incentives and technical assistance programs.”
The Village of Oak Park requires that all buildings over 10,000 square feet benchmark their energy and water usage. Village Staff are increasing outreach to building owners to help them interpret their benchmarking results and point them to resources to improve building performance. The next step from benchmarking is to institute a building performance standard (BPS). Staff are beginning community outreach and the development of a BPS for Village buildings. Once a BPS is enacted, large buildings in the Village will be required to make performance improvements. Having access to financing to support those improvements will be essential to the successful implementation of that policy and long-term emission reductions from Village buildings. The establishment of a BPS aligns with CROP action EE02.
Timing Considerations
There are no specific timing considerations associated with this item.
Financial Impact
There are no costs associated with this item. An IFA PACE Project may result in a fee of $150 paid by the applicant to the PACE Project Administrator to be remitted to the Village to cover administrative costs. The Village may choose to waive this fee.
Operations Impact
Enabling this program does not create a significant operating impact for the Village. The Illinois Finance Authority handles all program administration and financing.
Each PACE project approved under the IFA PACE Program requires the execution of an assessment contract and related assignment agreement by an authorized officer of the municipality, which are listed in the Ordinance as the Village Manager or their designee.
Staff from the Offices of Sustainability and Resilience, Communications, Economic Vitality, and the Department of Development Services will collaborate to promote the availability of C-PACE financing and connect property owners to the appropriate contacts and resources.
DEI Impact
There is no DEI impact associated with this item.
Community Input
There has been no community input given in relation to this item.
Staff Recommendation
Adopt the Ordinance.
Advantages:
• Commercial and other properties in the Village will have access to more financing options for energy, water, and renewable projects.
Disadvantages:
• There are no disadvantages to this action.
Alternatives
Alternative 1:
The Board can reject the Ordinance.
Advantages:
• There are no advantages to this action.
Disadvantages:
• Properties in Oak Park will not have the option of securing financing through the IFA’s C-PACE program.
Anticipated Future Actions
There are no anticipated future actions in relation to this item.
Prepared By: Lindsey Roland Nieratka, Chief Sustainability Officer
Reviewed By: Jack Malec, Assistant to the Village Manager
Approved By: Kevin J. Jackson, Village Manager
Attachment(s):
1. IFA PACE Ordinance
2. Cover Letter to IFA PACE Ordinance
3. Exhibit A - IFA PACE Program Report
4. PACE project examples
5. PACE Presentation