Bill Text: IL SB1700 | 2017-2018 | 100th General Assembly | Engrossed

Bill Title: Creates the Property Assessed Clean Energy Act. Provides that a local unit of government may establish a property assessed clean energy program. Provides that, to finance or refinance one or more energy projects on the property covered by the program, a local unit of government may impose an assessment pursuant to the terms of an assessment contract with the record owner of the property to be assessed. Provides that a local unit of government may issue bonds to finance energy projects under a property assessed clean energy program. Contains other provisions. Effective immediately.

Spectrum: Moderate Partisan Bill (Democrat 4-1)

Status: (Engrossed) 2017-05-31 - Rule 19(a) / Re-referred to Rules Committee [SB1700 Detail]

Download: Illinois-2017-SB1700-Engrossed.html

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1 AN ACT concerning revenue.
2 Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
4 Section 5. If and only if House Bill 2831 of the 100th
5General Assembly becomes law as engrossed, then the Property
6Assessed Clean Energy Act is amended by changing Sections 5 and
725 as follows:
8 (10000HB2831eng, Sec. 5)
9 Sec. 5. Definitions. As used in this Act:
10 "Alternative energy improvement" means the installation or
11upgrade of electrical wiring, outlets, or charging stations to
12charge a motor vehicle that is fully or partially powered by
14 "Assessment contract" means a voluntary written contract
15between the local unit of government and record owner governing
16the terms and conditions of financing and assessment under a
18 "PACE area" means an area within the jurisdictional
19boundaries of a local unit of government created by an
20ordinance or resolution of the local unit of government to
21provide financing for energy projects under a property assessed
22clean energy program. A local unit of government may create
23more than one PACE area under the program, and PACE areas may

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1be separate, overlapping, or coterminous.
2 "Energy efficiency improvement" means equipment, devices,
3or materials intended to decrease energy consumption or promote
4a more efficient use of electricity, natural gas, propane, or
5other forms of energy on property, including, but not limited
6to, all of the following:
7 (1) insulation in walls, roofs, floors, foundations,
8 or heating and cooling distribution systems;
9 (2) storm windows and doors, multi-glazed windows and
10 doors, heat-absorbing or heat-reflective glazed and coated
11 window and door systems, and additional glazing,
12 reductions in glass area, and other window and door system
13 modifications that reduce energy consumption;
14 (3) automated energy control systems;
15 (4) high efficiency heating, ventilating, or
16 air-conditioning and distribution system modifications or
17 replacements;
18 (5) caulking, weather-stripping, and air sealing;
19 (6) replacement or modification of lighting fixtures
20 to reduce the energy use of the lighting system;
21 (7) energy controls or recovery systems;
22 (8) day lighting systems; and
23 (9) any other installation or modification of
24 equipment, devices, or materials approved as a utility
25 cost-savings measure by the governing body.
26 "Energy project" means the installation or modification of

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1an alternative energy improvement, energy efficiency
2improvement, or water use improvement, or the acquisition,
3installation, or improvement of a renewable energy system that
4is or will be affixed to new or a stabilized existing property
5(not new construction).
6 "Governing body" means the county board or board of county
7commissioners of a county, the city council of a city, or the
8board of trustees of a village.
9 "Local unit of government" means a county, city, or
11 "Person" means an individual, firm, partnership,
12association, corporation, limited liability company,
13unincorporated joint venture, trust, or any other type of
14entity that is recognized by law and has the title to or
15interest in property. "Person" does not include a local unit of
16government or a homeowner's or condominium association.
17 "Program administrator" means a for-profit entity or
18not-for profit entity that will administer a program on behalf
19of or at the discretion of the local unit of government. It or
20its affiliates, consultants, or advisors shall have done
21business as a program administrator or capital provider for a
22minimum of 18 months and shall be responsible for arranging
23capital for the acquisition of bonds issued by the local unit
24of government to finance energy projects.
25 "Property" means privately-owned commercial, industrial,
26non-residential agricultural, or multi-family (of 5 or more

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1units) real property located within the local unit of
2government, but does not include property owned by a local unit
3of government or a homeowner's or condominium association.
4 "Property assessed clean energy program" or "program"
5means a program as described in Section 10.
6 "Record owner" means the person who is the titleholder or
7owner of the beneficial interest in property.
8 "Renewable energy resource" includes energy and its
9associated renewable energy credit or renewable energy credits
10from wind energy, solar thermal energy, photovoltaic cells and
11panels, biodiesel, anaerobic digestion, and hydropower that
12does not involve new construction or significant expansion of
13hydropower dams. For purposes of this Act, landfill gas
14produced in the State is considered a renewable energy
15resource. The term "renewable energy resources" does not
16include the incineration or burning of any solid material.
17 "Renewable energy system" means a fixture, product,
18device, or interacting group of fixtures, products, or devices
19on the customer's side of the meter that use one or more
20renewable energy resources to generate electricity.
21 "Water use improvement" means any fixture, product,
22system, device, or interacting group thereof for or serving any
23property that has the effect of conserving water resources
24through improved water management or efficiency.
25(Source: 10000HB2831eng.)

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1 (10000HB2831eng, Sec. 25)
2 Sec. 25. Contracts with record owners of property.
3 (a) After creation of a program and PACE area, a record
4owner of property within the PACE area may apply with the local
5unit of government or its program administrator for funding to
6finance an energy project.
7 (b) A local unit of government may impose an assessment
8under a property assessed clean energy program only pursuant to
9the terms of a recorded assessment contract with the record
10owner of the property to be assessed.
11 (c) Before entering into an assessment contract with a
12record owner under a program, the local unit of government
13shall verify all of the following:
14 (1) that the property is within the PACE area;
15 (2) that there are no delinquent taxes, special
16 assessments, or water or sewer charges on the property;
17 (3) that there are no delinquent assessments on the
18 property under a property assessed clean energy program;
19 (4) there are no involuntary liens on the property,
20 including, but not limited to, construction or mechanics
21 liens, lis pendens or judgments against the record owner,
22 environmental proceedings, or eminent domain proceedings;
23 (5) that no notices of default or other evidence of
24 property-based debt delinquency have been recorded and not
25 cured;
26 (6) that the record owner is current on all mortgage

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1 debt on the property, the record owner has not filed for
2 bankruptcy in the last 2 years, and the property is not an
3 asset to a current bankruptcy.
4 (7) all work requiring a license under any applicable
5 law to make a qualifying improvement shall be performed by
6 a registered contractor that has agreed to adhere to a set
7 of terms and conditions through a process established by
8 the local unit of government.
9 (8) the contractors to be used have signed a written
10 acknowledgement that the local unit of government will not
11 authorize final payment to the contractor until the local
12 unit of government has received written confirmation from
13 the record owner that the improvement was properly
14 installed and is operating as intended; provided, however,
15 that the contractor retains all legal rights and remedies
16 in the event there is a disagreement with the owner;
17 (9) that the amount of the assessment in relation to
18 the greater of the assessed value of the property or the
19 appraised value of the property, as determined by a
20 licensed appraiser, does not exceed 25%; and
21 (10) a requirement that an assessment of the existing
22 water or energy use or and a modeling of expected monetary
23 savings has have been conducted for any proposed project.
24 (d) At least 30 days before entering into an agreement with
25the local unit of government, the record owner shall provide to
26the holders or loan servicers of any existing mortgages

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1encumbering or otherwise secured by the property a notice of
2the record owner's intent to enter into an assessment contract
3with the local unit of government, together with the maximum
4principal amount to be financed and the maximum annual
5assessment necessary to repay that amount, along with a request
6that the holders or loan servicers of any existing mortgages
7consent to the record owner subjecting the property to the
8program. A verified copy or other proof of those notices and
9the written consent of the existing mortgage holder for the
10record owner to enter into the assessment contract and
11acknowledging that the existing mortgage will be subordinate to
12the financing and assessment agreement and that the local unit
13of government can foreclose the property if the assessment is
14not paid shall be provided to the local unit of government.
15 (e) A provision in any agreement between a local unit of
16government and a public or private power or energy provider or
17other utility provider is not enforceable to limit or prohibit
18any local unit of government from exercising its authority
19under this Section.
20 (f) The record owner has signed a certification that the
21local unit of government has complied with the provisions of
22this Section, which shall be conclusive evidence as to
23compliance with these provisions, but shall not relieve any
24contractor, or local unit of government, from any potential
26 (g) This Section is additional and supplemental to county

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1and municipal home rule authority and not in derogation of such
2authority or limitation upon such authority.
3(Source: 10000HB2831eng.)