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HomeMy WebLinkAbout05-11-22 Sustainability Advisory Board Agenda and Packet MaterialsA.Call to Order - 6:00 PM B.Disclosures C.Changes to the Agenda D.Approval of Minutes D.1 Approval of Minutes from April 13, 2022 (Meyer) E.Public Comments This is the time to comment on any matter falling within the scope of the Sustainability Board. There will also be time in conjunction with each agenda item for public comment relating to that THE SUSTAINABILITY BOARD OF BOZEMAN, MONTANA SB AGENDA Wednesday, May 11, 2022 This meeting will be held both in-person and also using Webex, an online videoconferencing system. You can join this meeting: Via Webex: https://cityofbozeman.webex.com/cityofbozeman/onstage/g.php? MTID=e4511fe8c12de4c38f458250ff275561c Click the Register link, enter the required information, and click submit. Click Join Now to enter the meeting. Via Phone: This is for listening only if you cannot watch the stream, channel 190, or attend in-person United States Toll +1-650-479-3208 Access code: 2554 167 5164 If you are interested in commenting in writing on items on the agenda please send an email to agenda@bozeman.net prior to 12:00pm on the day of the meeting. Public comments will be accepted in-person during the appropriate agenda items. You may also comment by visiting the Commission's comment page. You can also comment by joining the Webex meeting. If you do join the Webex meeting, we ask you please be patient in helping us work through this hybrid meeting. As always, the meeting will be streamed through the Commission's video page and available in the City on cable channel 190. 1 item but you may only speak once. Please note, the Board cannot take action on any item which does not appear on the agenda. All persons addressing the Board shall speak in a civil and courteous manner and members of the audience shall be respectful of others. Please state your name and place of residence in an audible tone of voice for the record and limit your comments to three minutes. General public comments to the Board can be found on their Laserfiche repository page. F.FYI/Discussion F.1 2021 International Energy Conservation Code (IECC) Update Work Session.(Meyer) F.2 Commercial Property Assessed Capital Enhancements (C-PACE) Work Session.(Killeen) G.Adjournment For more information please contact Jon Henderson, jon.henderson@bozeman.net General information about the Sustainability Board can be found in our Laserfiche repository. This board generally meets on the second Wednesday of the month 6:00 pm to 8:00 pm. Citizen Advisory Board meetings are open to all members the public. If you have a disability and require assistance, please contact our ADA coordinator, Mike Gray at 406-582-3232 (TDD 406-582-2301). 2 Memorandum REPORT TO:Sustainability Board FROM:Natalie Meyer, Sustainability Program Manager Jon Henderson, Strategic Services Director SUBJECT:Approval of Minutes from April 13, 2022 MEETING DATE:May 11, 2022 AGENDA ITEM TYPE:Citizen Advisory Board/Commission RECOMMENDATION:Approve minutes as submitted. STRATEGIC PLAN:1.2 Community Engagement: Broaden and deepen engagement of the community in city government, innovating methods for inviting input from the community and stakeholders. BACKGROUND:In accordance with Commission Resolution 5323 and the City of Bozeman's Citizen Advisory Board Manual, all boards must have minutes taken and approved. Prepared minutes will be provided for approval by the board at the next regularly scheduled meeting. Staff will make any corrections identified to the minutes before submitting to the City Clerk's Office. UNRESOLVED ISSUES:None. ALTERNATIVES:1. Approve meeting minutes with corrections 2. Do not approve FISCAL EFFECTS:None. Attachments: 04-13-22 Sustainability Advisory Board Minutes.pdf Report compiled on: May 6, 2022 3 Bozeman Sustainability Advisory Board Meeting Minutes, 4/13/2022 Page 1 of 3 THE SUSTAINBILITY ADVISORY BOARD OF BOZEMAN, MONTANA MINUTES April 13, 2022 A) 00:03:27 Call to Order - 6:00 PM Present: Isabel Shaida, Lumay Murphy, Matt Thompson, Emma Bode, Rebecca Kurnick, Kristin Blackler, Terry Cunningham Absent: Benjamin Finegan B) 00:05:56 Disclosures • There were no disclosures. C) 00:06:17 Changes to the Agenda • There were no changes to the agenda. D) 00:06:24 Approval of Minutes D.1 Approval of Minutes from March 9, 2022 03-09-22_Sustainability_Board_Minutes.pdf 00:06:56 Motion D) Approval of Minutes Lumay Murphy: Motion Isabel Shaida: 2nd 00:07:47 Vote on the Motion to amend D) Approval of Minutes. The Motion carried 6 - 0 Approve: Isabel Shaida Lumay Murphy Matt Thompson Emma Bode Rebecca Kurnick Kristin Blackler 4 Bozeman Sustainability Advisory Board Meeting Minutes, 4/13/2022 Page 2 of 3 Disapprove: None E) 00:08:03 Public Comments • There were no public comments. F) 00:10:42 FYI/Discussion F.1 00:28:36 Electrification Campaign Work Session. 2022 Electrify Cohort Participants Map.pdf RMI Heat Pump Economic Analysis by City_2021.pdf Building Electrification Program Sustainability Advisory Board Presentation Slides • Sustainability Program Manager Natalie Meyer and Sustainability Specialist Ali Chipouras presented on the work the Sustainability Division is currently doing to develop a building electrification program. Sustainability Advisory Board Chair Emma Bode led the group through a discussion about the building electrification program. F.2 01:32:05 Bozeman Climate Plan Dashboard Work Session. • Sustainability Program Manager Natalie Meyer presented the new Bozeman Climate Plan Dashboard and led the board through a live demo of the dashboard. The Sustainability Advisory Board members discussed the dashboard and provided feedback. G) 02:11:32 Adjournment For more information please contact Jon Henderson, jon.henderson@bozeman.net General information about the Sustainability Board can be found in our Laserfiche repository. 5 Memorandum REPORT TO:Sustainability Board FROM:Jon Henderson, Strategic Services Director SUBJECT:2021 International Energy Conservation Code (IECC) Update Work Session. MEETING DATE:May 11, 2022 AGENDA ITEM TYPE:Citizen Advisory Board/Commission RECOMMENDATION:2021 International Energy Conservation Code (IECC) Update Work Session. STRATEGIC PLAN:6.3 Climate Action: Reduce community and municipal Greenhouse Gas (GHG) emissions, increase the supply of clean and renewable energy; foster related businesses. BACKGROUND:Action 1.B.2 of the Bozeman Climate Plan calls for adoption of a state-wide net zero energy code. The State of Montana is considering adoption of the 2021 International Energy Conservation Code (IECC) that would improve the overall energy efficiency of residential and commercial buildings. With this adoption of the 2021 IECC, the State of Montana's draft rules suggest there may be an opportunity to consider local adoption of solar-ready design for commercial (Appendix CB) and residential buildings (Appendix RV), as well as potential for adopting net-zero energy for commercial buildings (Appendix CC). Natalie Meyer, City of Bozeman Sustainability Program Manager will provide a brief presentation on the status of the update to include an open discussion with the Board. UNRESOLVED ISSUES:None. ALTERNATIVES:As suggested by the Sustainability Advisory Board. FISCAL EFFECTS:None. Report compiled on: May 5, 2022 6 Memorandum REPORT TO:Sustainability Board FROM:Jon Henderson, Strategic Services Director SUBJECT:Commercial Property Assessed Capital Enhancements (C-PACE) Work Session. MEETING DATE:May 11, 2022 AGENDA ITEM TYPE:Citizen Advisory Board/Commission RECOMMENDATION:Commercial Property Assessed Capital Enhancements (C-PACE) Work Session. STRATEGIC PLAN:6.3 Climate Action: Reduce community and municipal Greenhouse Gas (GHG) emissions, increase the supply of clean and renewable energy; foster related businesses. BACKGROUND:Action 1.A.6 of the Bozeman Climate Plan calls for the creation of a Montana green bank and countywide low-interest loan program to spur public and private investment in energy efficiency and renewable energy. Commercial Property Assessed Capital Enhancements (C-PACE) financing is recognized as a tool that will further this action and was authorized in Montana (MCA 90- 4-13) during the 2021 Legislative Session. The C-PACE statute enables cities and counties to impose a special charge on real property to secure loans made for energy efficiency, water conservation, and renewable energy improvements. On April 12, 2022, the Gallatin County Commission approved Resolution No. 2022-047 establishing Gallatin County as a C-PACE district. The program is administered statewide by the Montana Facility Finance Authority. The program is tax neutral with no financial exposure to the City, County, or to taxpayers. Ita Killeen, member of the Northern Plains Resource Council Board of Directors, will provide a presentation to the Sustainability Citizen Advisory Board regarding details of the C-PACE program. The Board will consider the following questions during discussion: What information and resources are needed to help build awareness of Gallatin PACE? What targeted marketing strategies should the City of Bozeman consider? What types of market development should the City of Bozeman, or 7 other community organizations, initiate to encourage participation in Gallatin PACE? Useful background information can be found on the MT.gov website: https://lastbestpace.com, along with the attached Fact Sheet and FAQ. UNRESOLVED ISSUES:None. ALTERNATIVES:As suggested by the Sustainability Citizen Advisory Board. FISCAL EFFECTS:None. Attachments: CPACE Fact Sheet CPACE FAQ Report compiled on: May 5, 2022 8 Many property owners face high utility bills caused by old, inefficient buildings in need of upgrades. These upgrades would save Montana’s business owners more money on their utility bills than they cost over the long run, but the upfront costs can be hard to afford. Commercial Property-Assessed Captial Enhancements (C-PACE) is a solution to these financial challenges. C-PACE is a financing tool that allows property owners to secure 100% upfront financing for energy efficiency and water conservation upgrades to commercial buildings. The cost of these upgrades is repaid as a small assessment on the property’s annual tax bill. C-PACE financing is designed so that the annual energy savings from these upgrades is greater than the assessment on the annual property tax bill. To bring C-PACE to your community, your County Commission must first adopt a resolution allowing C-PACE financing to be used in the County. Once C-PACE is enabled in your county, property owners can access the financing to affordably make energy efficiency and renewable energy upgrades. C-PACE will save Montanans money on their energy bills while creating economic activity—and jobs—that build thriving communities. That’s why Montanans of all types and stripes support C-PACE! Join us in bringing C-PACE to Montana today!09/20CASH FLOW WITH A C-PACE PROJECT MONEY 5 10 15 20 25 YEARS ASSESSMENT PAYMENTS TOTAL SAVINGS C onserving E nergy Saving M oney Creating J obs Commercial Property Assessed Capital Enhancements www.NorthernPlains.org • (406) 248-1154 • 220 S. 27th St., Billings, MT 59101 9 A Public-Private Partnership C-PACE builds a bridge between Montana businesses, lenders, and state and local governments. Local governments place property assessments and facilitate repayment because C-PACE meets their economic development goals. Montana lenders support C-PACE because it is another tool to help them deploy capital in the community. Business owners support C-PACE because it helps them save money on their utility bills. Accessible to Everyone C-PACE financing requires no upfront investment and covers all costs, including the cost of an energy audit and/or an application fee. Property owners must be current on their property taxes, have an appropriate assessment-to-value ratio, and pass a credit review. Voluntary C-PACE is 100% voluntary. Cities and counties can choose whether or not they want to enable the program for their jurisdiction. Cities and counties will have the ability to opt into a statewide C-PACE program administered by a trusted thirdparty, the Montana Facility Finance Authority. In communities that choose to participate in the C-PACE program, a C-PACE assessment is only paid by the property owner of the building receiving the upgrades. What is Commercial PACE? C-PACE: Saving Money, Conserving Energy, Creating Jobs PACE Nationwide in 2022 www.NorthernPlains.org • (406) 248-1154 • 220 S. 27th St., Billings, MT 59101 ELIGIBLE UPGRADES • Insulation • New heating and cooling systems • Lighting improvements • Water-efficient fixtures and more ELIGIBLE PROPERTY TYPES • Businesses • Schools • Hospitals • Non-profit buildings • Multi-family housing • Agricultural properties State and local government buildings are NOT eligible for C-PACE. 10 1. The County chooses to enable C-PACE. ANNUALLIEN COSTANNUALSAVINGS 2. The Property Owner gets a baseline energy audit to identify needed efficiency upgrades. 3. The Property Owner submits a project application to the C-PACE program administrator. 4. The Program Administrator reviews the application with an independent review of energy projections. 5. Approved projects are sent to C-PACE participating Banks and Investors. 6. Contracts are signed and workers are hired. 7. The Property Owner begins long-term savings on their utility bills. C-PACE is repaid as an assessment on property taxes. Low Risk $$$ How a C-PACE project works The Outcome: Counties win by generating economic activity and increasing property values. Property Owner s win by saving money and improving their buildings. Banks and Investors win by making low-risk investments. Local Workers win by getting more job opportunities. www.NorthernPlains.org • (406) 248-1154 • 220 S. 27th St., Billings, MT 59101 C-PACE: Saving Money, Conserving Energy, Creating Jobs 11 C-PACE: Saving Money, Conserving Energy, Creating Jobs Creates Local Jobs When building owners can finance the up-front cost of an energy efficiency upgrade, more upgrades are undertaken. This creates more work for HVAC (heating, ventilation, air conditioning), lighting, insulation, and electrical contractors as well as renewable energy installers. No Cost to Taxpayers C-PACE programs do not use public money. Eligible up- grades are funded using private capital, and a small fee on each project pays for program administration costs, including any cost to state and local governments. Transferrable C-PACE financing is an investment in the property, not a loan to the property owners. C-PACE upgrades are permanently attached to the property and save money for the current property owner. When the ownership of a C-PACE property changes hands, the upgrades stay with the property; therefore the assessment stays with the property. Montanans want to bring C-PACE to Montana because it will help hardworking Montanans save money, create good-paying jobs for the local workforce, drive economic development, and build thriving communities. Why Enable Commercial PACE in Montana? In our current economic climate, supporting the locally-owned businesses of Main Street Montana is more important than ever. Commercial Property-Assessed Capital Enhancements (C-PACE) will give local businesses every opportunity to thrive. C-PACE is a voluntary, opt-in financing tool that uses no public money. Small-business owners across the state could start seeing savings through energy upgrades to their buildings. C-PACE already has wide support from businesses from banks to breweries. Join us in shaping a clean energy future that works for all Montanans! Why Commercial PACE? Learn more about CPACE: www.lastbestpace.com. 12 C-PACE Frequently Asked Questions Who provides the financing for C-PACE projects? In other states nationwide, private financing (banks, credit unions, investment funds, etc) has been the primary source of capital for C-PACE projects. An open system is maintained, enabling a variety of private capital providers to participate on a project-specific basis. Why should the county be involved with facilitating private financing for private property? C-PACE utilizes property assessments for repayment, based on the belief that energy efficiency and water conservation upgrades are in the public interest. The property assessment is a critical aspect of making C-PACE work as it reduces the risk for lenders. Counties participate because it's a win-win for their economic development goals. When property owners reduce their utility costs, they have more income to recirculate into the community. Moreover, the upgrades put local contractors and installers to work. To enable these economic benefits, the county creates a county-wide district and places voluntary assessments on individual parcels of commercial property, and facilitates repayment between private property owners and private capital providers on property taxes, similar to other types of special assessments and Special Improvement Districts. Many people are familiar with seeing a line-item for sewer or sidewalk upgrades on their property taxes. C-PACE would work the same way. It is a tried-and-true financing method. Does the county have any other role? If there is a statewide program administrator, the county’s only task will be to place the voluntary tax assessment on individual parcels of commercial property, facilitate repayment on property taxes once a year, and remit payment to the private financier or statewide program administrator. How is the program administration at the state or county level paid for? Will this require appropriations by the state or my county? C-PACE program administration pays for itself with a 1-2% economic development fee on each project. If there is a statewide program administrator, they would get a percent, and the county could get a percent as well. How does C-PACE ensure that my annual utility savings will be greater than my annual assessment payment? To ensure that C-PACE projects guarantee future energy savings for property owners, C-PACE legislation requires that a licensed architect or engineer must complete a baseline energy audit 13 before the project is approved. This informs how specific measures will perform in your building. After the energy project is completed, the unit of local government must obtain verification that the renewable energy system or energy efficiency improvement was properly installed and is operating as intended. What happens if I want to sell the property while there is still an outstanding C- PACE assessment? If a commercial property owner sells their C-PACE-assessed property, the assessment transfers to the new owner as it was an investment in the property. The property assessment must be disclosed to potential buyers, who should be assured by the fact that their annual utility bill savings are designed to be greater than C-PACE payments. What happens in the case of foreclosure? The best way to think about it is: "Why is foreclosure taking place?" and "Who holds the deed to the property?" 1. If the property owner is delinquent on mortgage payments to the lender If the mortgage holder is foreclosing on the property, they take claim to the deed once they gain ownership. As they foreclose, the C-PACE lien is the senior lien so any delinquent C-PACE payments will be paid off first and the remaining C-PACE lien remains with the property. The mortgage holder will make the C-PACE assessment payments, along with the rest of the property taxes, as long as they hold the deed so they don't lose the property. Because of the impact to existing mortgage lenders, Montana C-PACE legislation will require “mortgage lender consent” before any C-PACE application is approved. This means the current mortgage lender must be notified and approve the C-PACE assessment. 2. If the property owner is delinquent on property taxes and C-PACE assessment to the county The county will deal with the situation as they always do-- place a tax lien on the property and collect or ultimately foreclose. If the municipality is the entity foreclosing (which is VERY RARE), the responsibility for the remaining CPACE assessment depends on their tax codes. In some areas the municipality is still responsible for making assessment payments to schools, fire houses, etc. on behalf of the property while they have the deed to the property. However, when this is the case, the municipality is usually made whole at the time of the sale of the property to a new owner. So there is a possibility for a cash flow "loss" but not a permanent loss since they will recover what was paid at the time of sale of the property. We are doing further research into this question in the Montana tax code. 14