City approves new avenue for business property owners to finance improvements

In a recent move, the Cameron City Council adopted resolutions which makes businesses and nonprofit property owners in Cameron eligible to participate in a 100 percent financing program for property improvements which address energy efficiencies. 

In 2013, Texas passed legislation giving property owners access to a new form of financing for building energy and water upgrades. Commercial Property Assessed Clean Energy (TX-PACE) is a new public/private partnership program that allows Texas building owners to finance energy and water efficiency upgrades. 

TX-PACE allows property owners to access financing to undertake qualifying energy and water efficiency and clean energy improvements on their buildings and repay the investment through an assessment on their property. Like a sidewalk or sewer assessment, capital provided under TX-PACE financing is secured by a lien on the owner’s property and paid back over time. 

Like other special assessments, TX-PACE is a non-accelerating senior lien secured by the property. The repayment obligation transfers automatically to the next owner if the property is sold and in the event of default, only the payments in arrears come due. This arrangement spreads the cost of water efficiency and clean energy improvements – such as energy efficient boilers, upgraded insulation, new windows, or solar installations – over the expected life of the measure. Because the payment is tied to the property, TX-PACE projects are seen as less risky than typical loans, and low interest capital can be raised from the private sector with no government financing required. 

TX-PACE is a proven and effective tool to attract private capital into the clean energy and energy/water efficiency market. It is available to commercial, industrial, and nonprofit properties, and to multifamily properties with five or more units.

It is important to note that accessing this program is entirely at the discretion and choice of the property owner.  Projects go through a thorough review to ensure that the improvement planned will have positive cashflow results (i.e. reducing energy and water consumption monthly produces a net positive cashflow for the business or nonprofit).

“Looking around Cameron, there are wonderful buildings, which, with improvements would be lovely new businesses,” Ginger Watkins, Executive Director of the Cameron Industrial Foundation said.  “The TX-PACE program is a tool that can help make those improvements financially feasible.”

So what kinds of things can you do with TX-PACE Financing?  

The following list of long-standing, proven energy efficiency technologies is intended as a reference list. Even if not included on this list, Texas PACE Authority will review proposed technologies and accept them if they meet statutory requirements. Those include high efficiency lighting; heating, ventilation and air conditioning (HVAC) upgrades; new automated building and HVAC controls; variable speed drives (VSDs) on motors fans and pumps; high efficiency chillers; high efficiency boilers and furnaces; high efficiency hot water heating systems; combustion and burner upgrades; fuel switching; water conservation measures; low flow water fixtures; irrigation improvements that decrease water consumption; heat recovery and steam traps; building enclosure/envelope improvements; and building automation (energy management) systems.

“We are really excited about this program,” Watkins said. “The potential for owners of business or non-profit properties in Cameron to make improvements in the energy efficiencies of their buildings is tremendous.  Add to this program a Cameron Business and Commercial District Façade Grant, historic tax credits (depending on the building), and, if investing capital gains the tax credits from the designated Opportunity Zone program; then you can really see dollars stretch.”  

“Be watching for an announcement of workshops which will discuss these programs,” Cameron Chamber Director Melanie Reed said. “In the meantime, feel free to contact either me or Ginger Watkins.  Either one of us would be happy to talk with you about these programs.”

Detailed information on the TX-PACE program please contact Charlene Heydinger, President of the Texas PACE Authority at charlene.heydinger@keeppace.org.