HF 2624

as introduced - 92nd Legislature (2021 - 2022) Posted on 03/17/2022 05:21pm

A bill for an act
relating to energy; modifying the property assessed clean energy program; amending
Minnesota Statutes 2020, sections 216C.435, subdivisions 3a, 8; 216C.436,
subdivision 2.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2020, section 216C.435, subdivision 3a, is amended to read:

Subd. 3a.

Cost-effective energy improvements.

"Cost-effective energy improvements"
means:

(1) any new construction, renovation, or retrofitting of qualifying commercial real
property to improve energy efficiency that is permanently affixed to the property, results
in a net reduction in energy consumption without altering the principal source of energy,
and has been identified in an energy audit as repaying the purchase and installation costs
in 20 years or less, based on the amount of future energy saved and estimated future energy
prices;

(2) any renovation or retrofitting of qualifying residential real property that is permanently
affixed to the property and is eligible to receive an incentive through a program offered by
the electric or natural gas utility that provides service under section 216B.241 to the property
or is otherwise determined to be a cost-effective energy improvement by the commissioner
under section 216B.241, subdivision 1d, paragraph (a);

(3) permanent installation of new or upgraded electrical circuits and related equipment
to enable electrical vehicle charging; deleted text begin or
deleted text end

(4) a solar voltaic or solar thermal energy system attached to, installed within, or
proximate to a building that generates electrical or thermal energy from a renewable energy
source that has been identified in an energy audit or renewable energy system feasibility
study as repaying their purchase and installation costs in 20 years or less, based on the
amount of future energy saved and estimated future energy prices deleted text begin . deleted text end new text begin ;
new text end

new text begin (5) any improvement to qualifying farmland, as defined in section 273.13, subdivision
23, that is permanent in nature, results in improved agricultural productivity or resiliency,
and reduces environmental impact; or
new text end

new text begin (6) water conservation measures, which includes permanently affixed equipment,
appliances, or improvements that reduce a property's water consumption or that enable the
property to manage water more efficiently.
new text end

Sec. 2.

Minnesota Statutes 2020, section 216C.435, subdivision 8, is amended to read:

Subd. 8.

Qualifying commercial real property.

"Qualifying commercial real property"
means a multifamily residential dwelling, deleted text begin or deleted text end a commercial or industrial building, new text begin or farmland
new text end that the implementing entity has determined, after review of an energy audit deleted text begin or deleted text end new text begin , new text end renewable
energy system feasibility study, new text begin or agronomic assessment, new text end can be benefited by installation
of cost-effective energy improvements. Qualifying commercial real property includes new
construction.

Sec. 3.

Minnesota Statutes 2020, section 216C.436, subdivision 2, is amended to read:

Subd. 2.

Program requirements.

A commercial PACE loan program must:

(1) impose requirements and conditions on financing arrangements to ensure timely
repayment;

(2) require an energy audit or renewable energy system feasibility study to be conducted
on the qualifying commercial real property and reviewed by the implementing entity prior
to approval of the financing;

(3) require the inspection of all installations and a performance verification of at least
ten percent of the cost-effective energy improvements financed by the program;

(4) not prohibit the financing of all cost-effective energy improvements not otherwise
prohibited by this section;

(5) require that all cost-effective energy improvements be made to a qualifying
commercial real property prior to, or in conjunction with, an applicant's repayment of
financing for cost-effective energy improvements for that property;

(6) have cost-effective energy improvements financed by the program performed by a
licensed contractor as required by chapter 326B or other law or ordinance;

(7) require disclosures to borrowers by the implementing entity of the risks involved in
borrowing, including the risk of foreclosure if a tax delinquency results from a default;

(8) provide financing only to those who demonstrate an ability to repay;

(9) not provide financing for a qualifying commercial real property in which the owner
is not current on mortgage or real property tax payments;

(10) require a petition to the implementing entity by all owners of the qualifying
commercial real property requesting collections of repayments as a special assessment under
section 429.101;

(11) provide that payments and assessments are not accelerated due to a default and that
a tax delinquency exists only for assessments not paid when due; deleted text begin and
deleted text end

(12) require that liability for special assessments related to the financing runs with the
qualifying commercial real property deleted text begin . deleted text end new text begin ; and
new text end

new text begin (13) prior to financing any improvements to or imposing any assessment upon qualifying
commercial real property, require notice to and written consent from the mortgage lender
of any mortgage encumbering or otherwise secured by the qualifying commercial real
property.
new text end