May 10, 2017, Introduced by Senator BOOHER and referred to the Committee on Local Government.
A bill to amend 2010 PA 270, entitled
"Property assessed clean energy act,"
by amending sections 3 and 9 (MCL 460.933 and 460.939).
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 3. As used in this act:
(a) "District" means a district created under a property
assessed clean energy program by a local unit of government that
lies within the local unit of government's jurisdictional
boundaries. A local unit of government may create more than 1
district under the program, and districts may be separate,
overlapping, or coterminous.
(b) "Energy efficiency improvement" means equipment, devices,
or materials intended to decrease energy consumption, including,
but not limited to, all of the following:
(i) Insulation in walls, roofs, floors, foundations, or
heating and cooling distribution systems.
(ii) Storm windows and doors; multi-glazed windows and doors;
heat-absorbing or heat-reflective glazed and coated window and door
systems; and additional glazing, reductions in glass area, and
other window and door system modifications that reduce energy
consumption.
(iii) Automated energy control systems.
(iv) Heating, ventilating, or air-conditioning and
distribution system modifications or replacements.
(v) Caulking, weather-stripping, and air sealing.
(vi) Replacement or modification of lighting fixtures to
reduce the energy use of the lighting system.
(vii) Energy recovery systems.
(viii) Day lighting systems.
(ix) Installation or upgrade of electrical wiring or outlets
to charge a motor vehicle that is fully or partially powered by
electricity.
(x) Measures to reduce the usage of water or increases the
efficiency of water usage.
(xi) Any other installation or modification of equipment,
devices, or materials approved as a utility cost-savings measure by
the governing body.
(c) "Energy project" means the installation or modification of
an energy efficiency improvement or the acquisition, installation,
or improvement of a renewable energy system or anaerobic digester.
(d) "Governing body" means the county board of commissioners
of a county, the township board of a township, or the council or
other similar elected legislative body of a city or village.
(e) "Local unit of government" means a county, township, city,
or village.
(f) "Person" means an individual, firm, partnership,
association, corporation, unincorporated joint venture, or trust,
organized, permitted, or existing under the laws of this state or
any other state, including a federal corporation, or a combination
thereof. However, person does not include a local unit of
government.
(g) "Property" means privately owned commercial or industrial
real property located within the local unit of government.
(h) "Property assessed clean energy program" or "program"
means a program as described in section 5(2).
(i) "Record owner" means the person or persons possessed of
the most recent fee title or land contract vendee's interest in
property as shown by the records of the county register of deeds.
(j) "Renewable energy resource" means a resource that
naturally replenishes over a human, not a geological, time frame
and that is ultimately derived from solar power, water power, or
wind power. Renewable energy resource does not include petroleum,
nuclear, natural gas, or coal. A renewable energy resource comes
from the sun or from thermal inertia of the earth and minimizes the
output of toxic material in the conversion of the energy and
includes, but is not limited to, all of the following:
(i) Biomass.
(ii) Solar and solar thermal energy.
(iii) Wind energy.
(iv) Geothermal energy.
(v) Methane gas captured from a landfill.
(k) "Renewable energy system" means a fixture, product,
device, or interacting group of fixtures, products, or devices on
the customer's side of the meter that use 1 or more renewable
energy resources to generate electricity. Renewable energy system
includes a biomass stove but does not include an incinerator or
digester.
Sec. 9. (1) The report on the proposed program required under
section 7 shall include all of the following:
(a) A form of contract between the local unit of government
and record owner governing the terms and conditions of financing
and assessment under the program.
(b) Identification of an official authorized to enter into a
program contract on behalf of the local unit of government.
(c) A maximum aggregate annual dollar amount for all financing
to be provided by the local unit of government under the program.
(d) An application process and eligibility requirements for
financing energy projects under the program.
(e) A method for determining interest rates on assessment
installments, repayment periods, and the maximum amount of an
assessment.
(f) Explanation of how assessments will be made and collected
consistent with section 13(2).
(g) A plan for raising capital to finance improvements under
the program. The plan may include any of the following:
(i) The sale of bonds or notes, subject to the revised
municipal finance act, 2001 PA 34, MCL 141.2101 to 141.2821.
(ii) Amounts to be advanced by the local unit of government
through funds available to it from any other source.
(iii) Owner-arranged financing from a commercial lender. Under
owner-arranged financing, the local unit of government may impose
an assessment pursuant to section 11 and forward payments to the
commercial lender or the record owner may pay the commercial lender
directly.
(h) Information regarding all of the following, to the extent
known, or procedures to determine the following in the future:
(i) Any reserve fund or funds to be used as security for bonds
or notes described in subdivision (g).
(ii) Any application, administration, or other program fees to
be charged to record owners participating in the program that will
be used to finance costs incurred by the local unit of government
as a result of the program.
(i) A requirement that the term of an assessment not exceed
the useful life of the energy project paid for by the assessment.
(j) A requirement for an appropriate ratio of the amount of
the assessment to the assessed value of the property.
(k) A requirement that the record owner of property subject to
a mortgage obtain written consent from the mortgage holder before
participating in the program.
(l) Provisions for marketing and participant education.
(m) Provisions for adequate debt service reserve fund.
(n) Quality assurance and antifraud measures.
(o) A requirement that a baseline energy audit be conducted
before an energy project is undertaken, to establish future energy
savings. After the energy project is completed, the local unit of
government shall obtain verification that the renewable energy
system, anaerobic digester, or energy efficiency improvement was
properly installed and is operating as intended.
(p) For an energy project financed with more than $250,000.00
in assessments, both of the following:
(i) A requirement for ongoing measurements that establish the
savings realized by the record owner from the energy project.
(ii) A requirement that, in the contract for installation of
the energy project, the contractor guarantee to the record owner
that the energy project will achieve a savings-to-investment ratio
greater than 1 and agree to pay the record owner, on an annual
basis, any shortfall in savings below this level.
(2) The local unit of government shall make the report
available for review on the local unit of government's website or
at the office of the clerk or the official authorized to enter
contracts on behalf of the local unit of government under the
property assessed clean energy program.
Enacting section 1. This amendatory act takes effect 90 days
after the date it is enacted into law.