HF 3109

1st Committee Engrossment - 86th Legislature (2009 - 2010)

Posted on 03/19/2013 07:29 p.m.

1.1A bill for an act 1.2relating to local government; authorizing local governments to finance energy 1.3improvements for property owners to install energy efficient or renewable energy 1.4improvements; providing for repayment as a special assessment; authorizing 1.5issuance of revenue bonds;amending Minnesota Statutes 2008, section 429.101, 1.6subdivision 1; proposing coding for new law in Minnesota Statutes, chapter 1.7216C. 1.8BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 1.9    Section 1. new text begin [216C.435] DEFINITIONS. new text end 1.10     new text begin Subdivision 1. new text end new text begin Scope. new text end new text begin For the purposes of this section and section 216C.436, the new text end 1.11 new text begin terms defined in this section have the meanings given them. new text end 1.12     new text begin Subd. 2. new text end new text begin City. new text end new text begin "City" means a home rule charter or statutory city. new text end 1.13     new text begin Subd. 3. new text end new text begin Local government. new text end new text begin "Local government" means a city, county, or town. new text end 1.14     new text begin Subd. 4. new text end new text begin Energy audit. new text end new text begin "Energy audit" means a formal evaluation of the energy new text end 1.15 new text begin consumption of a building by a certified energy auditor, whose certification is approved by new text end 1.16 new text begin the commissioner, for the purpose of identifying appropriate energy improvements that new text end 1.17 new text begin could be made to the building and including an estimate of the length of time a specific new text end 1.18 new text begin energy improvement will take to repay its purchase and installation costs, based on the new text end 1.19 new text begin amount of energy saved and estimated future energy prices. new text end 1.20     new text begin Subd. 5. new text end new text begin Energy improvement. new text end new text begin "Energy improvement" means: new text end 1.21 new text begin (1) any renovation or retrofitting of a building to improve energy efficiency that new text end 1.22 new text begin is permanently affixed to the property and that results in a net reduction in energy new text end 1.23 new text begin consumption without altering the principal source of energy; new text end 1.24 new text begin (2) installation of new or upgraded electrical circuits to enable electrical vehicle new text end 1.25 new text begin charging; or new text end 2.1 new text begin (3) a renewable energy system attached to, installed within, or proximate to a new text end 2.2 new text begin building that generates electrical or thermal energy from a renewable energy source. new text end 2.3     new text begin Subd. 6. new text end new text begin Qualifying real property. new text end new text begin "Qualifying real property" means a new text end 2.4 new text begin single-family or multifamily residential dwelling, or a commercial or industrial building, new text end 2.5 new text begin that the city has determined, after review of an energy audit or renewable energy system new text end 2.6 new text begin feasibility study, can be benefited by installation of energy improvements. new text end 2.7     new text begin Subd. 7. new text end new text begin Renewable energy. new text end new text begin "Renewable energy" means energy produced by new text end 2.8 new text begin means of solar thermal, solar photovoltaic, wind, or geothermal resources. new text end 2.9     new text begin Subd. 8. new text end new text begin Renewable energy system feasibility study. new text end new text begin "Renewable energy system new text end 2.10 new text begin feasibility study" means a written study, conducted by a contractor trained to perform that new text end 2.11 new text begin analysis, for the purpose of determining the feasibility of installing a renewable energy new text end 2.12 new text begin system in a building, including an estimate of the length of time a specific renewable new text end 2.13 new text begin energy system will take to repay its purchase and installation costs, based on the amount of new text end 2.14 new text begin energy saved and estimated future energy prices. For a geothermal energy improvement, new text end 2.15 new text begin the feasibility study must calculate net savings in terms of nongeothermal energy and costs. new text end 2.16     new text begin Subd. 9. new text end new text begin Solar thermal. new text end new text begin "Solar thermal" has the meaning given to "qualifying solar new text end 2.17 new text begin thermal project" in section 216B.2411, subdivision 2, paragraph (e). new text end 2.18     new text begin Subd. 10. new text end new text begin Solar photovoltaic. new text end new text begin "Solar photovoltaic" has the meaning given in new text end 2.19 new text begin section 216C.06, subdivision 16, and must meet the requirements of section 216C.25. new text end 2.20 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 2.21    Sec. 2. new text begin [216C.436] VOLUNTARY ENERGY IMPROVEMENTS FINANCING new text end 2.22 new text begin PROGRAM FOR LOCAL GOVERNMENTS. new text end 2.23     new text begin Subdivision 1. new text end new text begin Program authority. new text end new text begin A local government may establish a program new text end 2.24 new text begin to finance energy improvements to enable owners of qualifying real property to pay for new text end 2.25 new text begin cost-effective energy improvements to the qualifying real property with the net proceeds new text end 2.26 new text begin and interest earnings of revenue bonds authorized in this section. new text end 2.27     new text begin Subd. 2. new text end new text begin Program requirements. new text end new text begin A financing program must: new text end 2.28 new text begin (1) impose requirements and conditions on financing arrangements to ensure timely new text end 2.29 new text begin repayment; new text end 2.30 new text begin (2) require an energy audit or renewable energy system feasibility study to be new text end 2.31 new text begin conducted on the qualifying real property and reviewed by the local government prior to new text end 2.32 new text begin approval of the financing; new text end 2.33 new text begin (3) inspect the installation and verify the performance of energy improvements new text end 2.34 new text begin financed by the program; new text end 3.1 new text begin (4) require that all cost-effective energy efficiency improvements be made to a new text end 3.2 new text begin qualifying real property prior to, or in conjunction with, an applicant receiving financing new text end 3.3 new text begin for a renewable energy system for that property; new text end 3.4 new text begin (5) have work financed by the program done by licensed contractors as required by new text end 3.5 new text begin chapter 326B or other law or ordinance; new text end 3.6 new text begin (6) require disclosures to borrowers by the local government of the risks involved in new text end 3.7 new text begin borrowing, including the risk of foreclosure if a tax delinquency results from a default; new text end 3.8 new text begin (7) provide financing only to those who demonstrate an ability to repay; new text end 3.9 new text begin (8) not provide financing for a qualifying real property in which the owner has a new text end 3.10 new text begin negative equity or is not current on mortgage or real property tax payments; new text end 3.11 new text begin (9) require a petition by all owners of the qualifying real property requesting new text end 3.12 new text begin collections of repayments as a special assessment under section 429.101; new text end 3.13 new text begin (10) provide that payments and assessments are not accelerated due to a default and new text end 3.14 new text begin that a tax delinquency exists only for assessments not paid when due; and new text end 3.15 new text begin (11) that liability for special assessments related to the financing runs with the new text end 3.16 new text begin qualifying real property. new text end 3.17     new text begin Subd. 3. new text end new text begin Financing terms. new text end new text begin Financing provided under this section must have: new text end 3.18 new text begin (1) a term not to exceed the weighted average of the useful life of the energy new text end 3.19 new text begin improvements installed, as determined by the local government, but in no event may new text end 3.20 new text begin a term exceed 20 years; new text end 3.21 new text begin (2) a principal amount not to exceed the lesser of ten percent of the appraised value new text end 3.22 new text begin of the real property on which the improvements are to be installed or the actual cost of new text end 3.23 new text begin installing the energy improvements, including the costs of necessary equipment, materials, new text end 3.24 new text begin and labor, the costs of each related energy audit or renewable energy system feasibility new text end 3.25 new text begin study, and the cost of verification of installation; and new text end 3.26 new text begin (3) an interest rate sufficient to pay the financing costs of the program, including the new text end 3.27 new text begin issuance of bonds and any financing delinquencies. new text end 3.28     new text begin Subd. 4. new text end new text begin Coordination with other programs. new text end new text begin A financing program must include new text end 3.29 new text begin cooperation and coordination with the conservation improvement activities of the utility new text end 3.30 new text begin serving the qualifying real property and other public and private energy improvement new text end 3.31 new text begin programs. new text end 3.32     new text begin Subd. 5. new text end new text begin Certificate of participation. new text end new text begin Upon completion of a project, a local new text end 3.33 new text begin government shall provide a borrower with a certificate stating participation in the program new text end 3.34 new text begin and what energy improvements have been made with financing program proceeds. new text end 3.35     new text begin Subd. 6. new text end new text begin Repayment. new text end new text begin A local government financing an energy improvement new text end 3.36 new text begin under this section must: new text end 4.1 new text begin (1) secure payment with a lien against the benefited qualifying real property; and new text end 4.2 new text begin (2) collect repayments as a special assessment as provided for in section 429.101 new text end 4.3 new text begin or by charter. new text end 4.4     new text begin Subd. 7. new text end new text begin Bond issuance; repayment. new text end new text begin (a) A local government may issue revenue new text end 4.5 new text begin bonds as provided in chapter 475 for the purposes of this section. new text end 4.6 new text begin (b) The bonds must be payable as to both principal and interest solely from the new text end 4.7 new text begin revenues from the assessments established in subdivision 4. new text end 4.8 new text begin (c) No holder of bonds issued under this subdivision may compel any exercise of the new text end 4.9 new text begin taxing power of the local government that issued the bonds to pay principal or interest on new text end 4.10 new text begin the bonds. Bonds issued under this subdivision are not a debt or obligation of the local new text end 4.11 new text begin government that issued them, nor is the payment of the bonds enforceable out of any new text end 4.12 new text begin money other than the revenue pledged to the payment of the bonds. new text end 4.13 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 4.14    Sec. 3. Minnesota Statutes 2008, section 429.101, subdivision 1, is amended to read: 4.15    Subdivision 1. Ordinances. (a) In addition to any other method authorized by 4.16law or charter, the governing body of any municipality may provide for the collection 4.17of unpaid special charges as a special assessment against the property benefited for all 4.18or any part of the cost of: 4.19    (1) snow, ice, or rubbish removal from sidewalks; 4.20    (2) weed elimination from streets or private property; 4.21    (3) removal or elimination of public health or safety hazards from private property, 4.22excluding any structure included under the provisions of sections 463.15 to 463.26; 4.23    (4) installation or repair of water service lines, street sprinkling or other dust 4.24treatment of streets; 4.25    (5) the trimming and care of trees and the removal of unsound trees from any street; 4.26    (6) the treatment and removal of insect infested or diseased trees on private property, 4.27the repair of sidewalks and alleys; 4.28    (7) the operation of a street lighting system; 4.29    (8) the operation and maintenance of a fire protection or a pedestrian skyway system; 4.30    (9) inspections relating to a municipal housing maintenance code violation; 4.31    (10) the recovery of any disbursements under section 504B.445, subdivision 4, 4.32clause (5), including disbursements for payment of utility bills and other services, even if 4.33provided by a third party, necessary to remedy violations as described in section 504B.445, 4.34subdivision 4 , clause (2); or 4.35    (11) [Repealed, 2004 c 275 s 5] 5.1    (12) the recovery of delinquent vacant building registration fees under a municipal 5.2program designed to identify and register vacant buildings. 5.3    (b) The council may by ordinance adopt regulations consistent with this section to 5.4make this authority effective, including, at the option of the council, provisions for placing 5.5primary responsibility upon the property owner or occupant to do the work personally 5.6(except in the case of street sprinkling or other dust treatment, alley repair, tree trimming, 5.7care, and removal new text begin , new text end or the operation of a street lighting system) upon notice before the work 5.8is undertaken, and for collection from the property owner or other person served of the 5.9charges when due before unpaid charges are made a special assessment. 5.10 new text begin (c) A home rule charter city, statutory city, county, or town operating an energy new text end 5.11 new text begin improvements financing program under section 216C.436 has the authority granted to a new text end 5.12 new text begin municipality under paragraph (a) with respect to energy improvements financed under new text end 5.13 new text begin that section. new text end 5.14 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end