TOWN OF APPLE VALLEY TOWN COUNCIL STAFF REPORT

Transcription

1 TOWN OF APPLE VALLEY TOWN COUNCIL STAFF REPORT To: Honorable Mayor and Town Council Date: July 24, 2018 From: Douglas B. Robertson, Town Manager Item No: 9 Town Manager s Office Subject: DISCUSSION AND POSSIBLE ACTION REGARDING INCLUSION OF PROPERTIES WITHIN THE TOWN OF APPLE VALLEY IN VARIOUS OPEN PACE PROGRAMS T.M. Approval: Budgeted Item: Yes No N/A RECOMMENDED ACTION: Any action or further direction for staff is at the discretion of the Town Council. SUMMARY: By a consensus of the Town Council at the May 8, 2018 Council meeting, staff was directed to agendize an item for discussion and possible action regarding inclusion of properties within the Town of Apple Valley for participation in open Property Assessed Clean Energy (PACE) programs. BACKGROUND: At the March 13, 2008 Council meeting, Dustin Reilich, Senior Director of Market Development with Renovate America (the home-improvement financing company who created the HERO program), gave a presentation on the new PACE program consumer protection laws enacted in 2017: AB 1284, (Dabbeneh). California Financing Law: Property Assessed Clean Energy program: program administrators; and SB 242, (Skinner). Property Assessed Clean Energy program: program administrator. As a result of this presentation, the Town Council requested an item be agendized in order to discuss PACE programs. At the May 8, 2018 Council meeting, Council received a staff report summarizing the history of PACE program participation by the Town and information on PACE legislation and two new class action lawsuits filed against the County of Los Angeles, Renovate America and Renew Financial regarding alleged PACE program predatory lending practices. At the conclusion of public comment and discussion, the Town Council requested that staff bring forth an item for a future Council meeting for discussion regarding PACE program licensing requirements and regulations, and for possible action regarding Town participation in various PACE programs. Council Meeting Date: 7/24/

2 In 2017, AB 1284 and SB 242 were signed into law by the Governor and brought sweeping changes to the regulation of program administrators and PACE solilcitors (home-improvement financing companies). In summary, the 2017 legislation: Requires PACE program administrators (the dozen or so companies that arrange PACE financing) to be licensed by the California Department of Business Oversight (DBO). Requires PACE program administrators to supervise PACE solicitors and solicitor agents. Authorizes the DBO to conduct investigations and examinations, and bring enforcement actions including suspensions or banishments from the industry against PACE administrators, solicitors and solicitor agents. Requires program administrators to determine that a property owner has a reasonable ability to pay the annual obligations of a PACE contract. Prohibits program administrators from making materially false or misleading statements or representations to a property owner about the terms or conditions of a PACE contract. Requires PACE solicitors and solicitor agents to be licensed by, or registered with, the Contractors State Licensing Board, unless otherwise exempt. Prohibits PACE solicitors and solicitor agents from offering a PACE contract that omits terms, conditions or disclosures required by law. Prohibits a program administrator from approving an assessment contract if a property has outstanding liens of more than $1,000, if the property owner has been subject to a bankruptcy hearing in the past seven years or if the property owner is behind on his or her mortgage payments. Most of the consumer protections required of PACE program administrators, solicitors and solicitor agents took effect on April 1, The licensing and DBO regulatory authority take effect on Jan. 1, Since the passage of AB 1284 and SB 242, two additional PACE-related bills have been introduced and are making their way through the legislature. AB 2063, (Aguiar-Curry). California Financing Law: PACE program administrators, was introduced to clarify, correct and clean up provisions of AB 1284 and SB 242, and proposes to: Prohibit a person from engaging in the business of a PACE solicitor unless that person is enroled with a program administrator. Council Meeting Date: 7/24/

3 Require program administrators processes for enrolling and cancelling the enrollment of PACE solicitors and solicitor agents and for promoting and evaluating the compliance of PACE solicitors and solicitor agents with the requirements of appilicable law to be acceptable to the Commissioner of Business Oversight. Clarify that the requirement for program administrators to notify the commissioner regarding each enrolled PACE solicitor and solicitor agent is a requirement for timely notification. Require program administrators to comply with the underwriting requirements of AB 1284 before they execute a PACE assessment contract and before work may commence under a home improvement contract finaced by that assessment contract. Sunset the provision of existing law that requires a program administrator to be responsible for the difference, in cases where there is a difference between the determination of the property owner s ability to pay the annual PACE obligation and the actual amount financed and require, for assessment contracts executed between April 1, 2018 and January 1, 2019, that if there is such a difference, the program administrator must provide a writtend disclosure to the property owner regarding the methodology used to determine that difference. Require the DBO to include information about funded PACE assessments in the annual report DBO is required to publish pursuant to the California Financing Law. Require program administrators to clarify to property owners on the confirmation of key terms call that must be held between a program administrator and at least one owner of the property on which the energy efficiency improvement is to be installed, that it is the responsibility of the property owner to contact his or her home insurance provider to determine whether the efficiency improvement to be financed by the PACE assessment is covered by his or her property insurance plan. SB 1087, (Roth). PACE program: program administrators, would make a series of cleanup changes to the provisions of AB 1284, including: Provide that it is unlawful for a home-improvement contractor to commence work under a home improvement contract, as specified, and that a home improvement contract is unenforceable if: 1) the property owner enters into the home improvement contract based on the reasonable belief that the work will be covered by the PACE program, and 2) the property owner applies for but is not approved for PACE financing in the amount requested by the property owner. Council Meeting Date: 7/24/

4 As of July 16, 2018, three of the PACE program providers interested in entering into agreements with the Town to offer PACE financing are listed in opposition to one or more of these PACE protection bills. Renew Financial and Renovate America are listed as official opposition to AB 2063, and Renew Financial, Renovate America and Ygrene Energy Fund are listed as official opposition to SB While this new legislation attempts to clarify and correct some of the ongoing concerns regarding PACE programs in California, the fact remains that in December 2017, the Federal Housing Administration joined the Federal Housing Finance Agency (which has barred Fannie Mae and Freddie Mac from purchasing mortgages on homes with PACE loans), by refusing to insuring new mortgages on homes with PACE loans. The FHA indicated that PACE loans lack sufficient consumer protection and put taxpayers at risk, and when a borrower with an FHA-backed mortgage is foreclosed upon, the portion of the PACE loan in arrears must be paid off first. The remaining PACE loan transfers to the new buyer, but the FHA indicated the loan transfer increases the likelihood the buyer will pay less, making it more difficult for the agency to meet its obligations. As requested at the May 8, 2018 Council meeting, staff has assembled the documents required for Town inclusion into various PACE programs. In the event the Town Council determines offering PACE program financing is in the best interest of the property owners within Apple Valley, the attached opt-in resolutions for CSCDA (Resolution No ), CMFA (Resolution No ), CEDA (Resolution No ) and GSFA (Resolutions Nos and ) have been modified to include provisions to: 1. Prohibit use of the Town s logo or otherwise market a PACE program as a Town or Town-endorsed program; 2. Prohibit prepayment penalties for the early payoff of a PACE assessment; and 3. Reserve the Town s right to withdraw consent of inclusion of Apple Valley properties at any time through written notice or subsequent resolution. FISCAL IMPACT: N/A. Council Meeting Date: 7/24/

5 Attachment A California Statewide Communities Development Authority CSCDA, the largest Joint Powers Authority in California, founded and sponsored by the League of California Cities and the California State Association of Counties, is implementing Property Assessed Clean Energy ( PACE ) under the provisions of Chapter 29 of Division 7 of the Streets & Highways Code (commonly referred to as AB 811 ) on behalf of its member counties and cities. AB811 authorizes a legislative body to designate an area within which authorized public officials (including a joint powers authority like CSCDA) and property owners may enter into voluntary contractual assessments to finance the installation of renewable energy, energy efficiency, water efficiency, and seismic strengthening improvements as well as electric vehicle charging infrastructure, in each case affixed to real property (the Improvements ). CSCDA s Commissioners pre-qualified and appointed several PACE Administrators to manage the CSCDA Open PACE program in order to offer members turn-key PACE solutions that provide residential and commercial property owners the choice among prequalified PACE financing providers, creating competition on terms, service and interest rates. The prequalified program administrators operating the following programs are AllianceNRG Program, PACE Funding Group LLC, Renewable Funding LLC (administering CaliforniaFIRST), Clean Fund Commercial PACE Capital and Petros PACE Finance. These Programs were selected to offer a combination of both commercial and residential benefitting the all property owners and local home improvement businesses within the Town. The following table outlines PACE programs available by program administrator: Program Administrator Residential PACE Commercial PACE Alliance NRG Program/Counterpointe X X CleanFund Commercial PACE Capital X PACE Funding Group, LLC X Petros PACE Finance, LLC X Renewable Funding, LLC/CaliforniaFIRST X X Renovate America/HERO X X Council Meeting Date: 7/24/

6 Attachment B California Municipal Finance Authority The CMFA is a Joint Powers Authority formed to assist local governments, non-profit organizations and businesses by promoting economic, cultural and community development, with the financing of economic development and charitable activities throughout California. To date, over 290 municipalities, including the Town of Apple Valley, have become members of the CMFA. As part of its economic and community development, the CMFA along with its current Program Administrators, Energy Efficient Equity, Inc.; BlueFlame PACE Services LLC; OnPACE Energy Solutions, LLC; PACE Equity, LLC; Petros PACE Administrator, LLC; Samas Capital LLC; Structured Finance Associates, LLC; and Twain Community Partners II LLC; are offering PACE financing for residential and commercial property owners in its member territories. The CMFA is expected to issue limited obligation bonds, notes or other forms of indebtedness to fund the projects. PACE is an innovative way to finance energy efficiency, water efficiency, and renewable energy upgrades for residential and commercial buildings. Property owners who participate in the program repay the loans through a voluntary contractual assessment collected together with their property taxes. One of the most notable characteristics of PACE programs is that the loan is attached to the property rather than belonging to an individual. Therefore, when the owner sells the property, the loan may be paid off during the sale or stay with the property and be paid off by the new owner, who also benefits from the upgrades that were completed. PACE financing enables individuals and businesses to defer the upfront costs of energy efficiency, water efficiency and renewable energy improvements. PACE loans are paid over a long period of time while energy costs are simultaneously lower, which typically provides the property owner with net savings. PACE overcomes challenges that have hindered adoption of energy efficiency and renewable energy measures for many property owners. Council Meeting Date: 7/24/

7 The following table outlines PACE programs available by program administrator: Program Administrator BlueFlame PACE Services, LLC/Blue PACE Energy Efficient Equity, Inc OnPACE Energy Solutions, LLC PACE Equity, LLC Petros PACE Administrator, LLC Samas Capital, LLC Structured Finance Associates, LLC Twain Community Partners II, LLC Residential PACE Commercial PACE X X X X X X X X Council Meeting Date: 7/24/

8 Attachment C California Enterprise Development Authority In partnership with Dividend Finance, CEDA issues multi-jurisdictional bonds that attract private capital for PACE-qualified improvements under the Figtree PACE program. The program enables property owners to amortize payments for eligible improvements for up to 25 years for Commercial PACE and up to 20 years for Residential PACE. PACE financing provides long term, low interest rate funds with no money down, repaid as a line-item on property owners annual tax bill. Property owners in over 200 California jurisdictions can reduce their carbon footprints by investing in clean energy improvements with PACE funding. This PACE initiative creates a streamlined and cost-free pathway for cities and counties to authorize a financing program for energy and water efficiency products benefiting property owners within their jurisdiction. Local municipalities that are not currently within Dividend Finance s Figtree PACE service area can join by adopting two resolutions: one authorizing the jurisdiction to join CEDA, and the second confirming the jurisdiction s intent to join Dividend Finance s Figtree PACE program as well as allowing CEDA to conduct assessment proceedings. Property owners completing PACE-qualifying projects benefit from higher real estate values, potentially large tax incentives from credits and accelerated depreciation, state cash rebates, diminished monthly energy costs, and hedging against escalating energy prices. PACE imposes no encumbrance on personal or business credit since financing is based on assessed property values. And PACE assessments freely transfer to subsequent property owners. The following table outlines PACE programs available by program administrator: Program Administrator Residential PACE Commercial PACE Dividend Finance, LLC/Figtree PACE X X Council Meeting Date: 7/24/

9 Attachment D Golden State Finance Authority GSFA is a joint exercise of powers authority established pursuant to Chapter 5 of Division 7, Title 1 of the Government Code of the State of California (Section 6500 and following) (the Act ) and the Joint Power Agreement entered into on July 1, 1993, as amended from time to time (the Authority JPA ). GSFA has established two Property Assessed Clean Energy ( PACE ) financing programs for residential, commercial, industrial and agricultural properties under the legislative authority of two separate California PACE laws: SB 555 PACE Community Facilities District: Senate Bill 555 amended the Mello-Roos Community Facilities Act, set forth in sections through of the California Government Code and particularly in accordance with sections (l) and (a) ( Mello-Roos Act ), to allow for the creation of Community Facilities Districts ( CFDs ) for the purpose of financing or refinancing the acquisition, installation, and improvement of energy efficiency, water conservation, renewable energy and electric vehicle charging infrastructure improvements permanently affixed to private or publicly-owned real property. Individual properties can be annexed into the district and be subject to the special tax that is imposed to repay project financing only if (i) the Council adopts a resolution consenting to the inclusion of parcels in the incorporated areas of the Town within the CFD and (ii) each participating owner provides its unanimous written approval for annexation of its property into the PACE CFD. AB 811 PACE Contractual Assessment Program: By the passage of Assembly Bill 811, the California State Legislature added Chapter 29 to the Improvement Bond Act of 1911, being Division 7 of the California Streets and Highways Code. This legislation authorized cities and counties to establish voluntary contractual assessment programs for the purpose financing private property improvements that promote renewable energy generation, energy and water efficiency and electric vehicle charging infrastructure. As with the SB 555 CFD, properties can be annexed into the AB 811 PACE program and be subject to the property tax assessment that is imposed to repay project financing only if (i) the Council adopts a resolution consenting to the inclusion of parcels in the incorporated areas of the Town within the program and (ii) each participating owner consents in writing to the annexation of its property into the PACE program. GSFA contracts with Ygrene Energy Fund CA LLC (Ygrene) to serve as the program administrator and to operate the Ygrene Works for California PACE financing program. Council Meeting Date: 7/24/

10 To participate in the PACE programs, the Town must become an Associate Member of GSFA. Associate membership requires no dues or other costs to the Town but permits participation in all GSFA programs including the PACE program. The following table outlines PACE programs available by program administrator: Program Administrator Ygrene Energy Fund CA, LLC/Ygrene Works Residential PACE Commercial PACE X X Council Meeting Date: 7/24/

11 RESOLUTION NO A RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF APPLE VALLEY, CALIFORNIA, CONSENTING TO THE INCLUSION OF PROPERTIES WITHIN THE TERRITORY OF THE TOWN IN THE CSCDA OPEN PACE PROGRAMS; AUTHORIZING THE CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY TO ACCEPT APPLICATIONS FROM PROPERTY OWNERS, CONDUCT CONTRACTUAL ASSESSMENT PROCEEDINGS AND LEVY CONTRACTUAL ASSESSMENTS WITHIN THE TERRITORY OF THE TOWN; AND AUTHORIZING RELATED ACTIONS WHEREAS, the California Statewide Communities Development Authority (the Authority ) is a joint exercise of powers authority, the members of which include numerous cities and counties in the State of California, including the Town of Apple Valley (the Town ); and WHEREAS, the Authority is implementing Property Assessed Clean Energy (PACE) programs, which it has designated CSCDA Open PACE, consisting of CSCDA Open PACE programs each administered by a separate program administrator (collectively with any successors, assigns, replacements or additions, the Programs ), to allow the financing or refinancing of renewable energy, energy efficiency, water efficiency and seismic strengthening improvements, electric vehicle charging infrastructure and such other improvements, infrastructure or other work as may be authorized by law from time to time (collectively, the Improvements ) through the levy of contractual assessments pursuant to Chapter 29 of Division 7 of the Streets & Highways Code ( Chapter 29 ) within counties and cities throughout the State of California that consent to the inclusion of properties within their respective territories in the Programs and the issuance of bonds from time to time; and WHEREAS, the program administrators currently active in administering Programs are the AllianceNRG Program (CounterPointe Energy Solutions (CA) LLC), PACE Funding Group LLC, CaliforniaFirst (Renew Financial Group LLC), CleanFund Commercial PACE Capital and HERO (Renovate America) and the Authority will notify the Town in advance of any additions or changes; and WHEREAS, Chapter 29 provides that assessments may be levied under its provisions only with the free and willing consent of the owner or owners of each lot or parcel on which an assessment is levied at the time the assessment is levied; and Council Meeting Date: 7/24/

12 WHEREAS, the Town desires to allow the owners of property ( Participating Property Owners ) within its territory to participate in the Programs and to allow the Authority to conduct assessment proceedings under Chapter 29 within its territory and to issue bonds to finance or refinance Improvements; and WHEREAS, the territory within which assessments may be levied for the Programs shall include all of the territory within the Town s official boundaries; and WHEREAS, the Authority will conduct all assessment proceedings under Chapter 29 for the Programs and issue any bonds issued in connection with the Programs; and WHEREAS, the Town will not be responsible for the conduct of any assessment proceedings; the levy of assessments; any required remedial action in the case of delinquencies in such assessment payments; or the issuance, sale or administration of any bonds issued in connection with the Programs; and WHEREAS, the Authority and its program administrators shall be prohibited from charging prepayment penalties on a PACE assessment resulting from any CSCDA Open PACE program; and WHEREAS, the Authority, program administrators and all affiliated subcontractors are prohibited from using the official Town logo or in any other way marketing the CSCDA Open PACE programs as Town or Town-endorsed programs. NOW, THEREFORE, BE IT RESOLVED by the Town Council of the Town of Apple Valley as follows: Section 1. This Town Council hereby finds and declares that properties in the territory of the Town will benefit from the availability of the Programs within the territory of the Town and, pursuant thereto, the conduct of special assessment proceedings by the Authority pursuant to Chapter 29 and the issuance of bonds to finance or refinance Improvements. Section 2. In connection with the Programs, the Town hereby consents to the conduct of special assessment proceedings by the Authority pursuant to Chapter 29 on any property within the territory of the Town and the issuance of bonds to finance or refinance Improvements; provided, that Council Meeting Date: 7/24/

13 (1) The Participating Property Owners, who shall be the legal owners of such property, execute a contract pursuant to Chapter 29 and comply with other applicable provisions of California law in order to accomplish the valid levy of assessments; and (2) The Town will not be responsible for the conduct of any assessment proceedings; the levy of assessments; any required remedial action in the case of delinquencies in such assessment payments; or the issuance, sale or administration of any bonds issued in connection with the Programs. Section 3. The appropriate officials and staff of the Town are hereby authorized and directed to make applications for the Programs available to all property owners who wish to finance or refinance Improvements; provided, that the Authority shall be responsible for providing such applications and related materials at its own expense. The following staff persons, together with any other staff persons chosen by the Town Manager of the Town from time to time, are hereby designated as the contact persons for the Authority in connection with the Programs: Special Projects Manager. Section 4. The appropriate officials and staff of the Town are hereby authorized and directed to execute and deliver such certificates, requisitions, agreements and related documents as are reasonably required by the Authority to implement the Programs. Section 5. The Town reserves the right to withdraw consent of inclusion of properties within its jurisdictional boundaries at any time through written notice to the Authority or any individual program administrator, and the Authority and program administrators agree to discontinue processing of new applications within the Town s jurisdictional boundaries immediately upon receipt of such notice. Section 6. The Town Council hereby finds that adoption of this Resolution is not a project under the California Environmental Quality Act, because the Resolution does not involve any commitment to a specific project which may result in a potentially significant physical impact on the environment, as contemplated by Title 14, California Code of Regulations, Section 15378(b)(4). Section 7. This Resolution shall take effect immediately upon its adoption. The Town Clerk is hereby authorized and directed to transmit a certified copy of this resolution to the Secretary of the Authority at: Secretary of the Board, California Statewide Communities Development Authority, 1400 K Street, Sacramento, CA Council Meeting Date: 7/24/

14 APPROVED and ADOPTED by the Town Council of the Town of Apple Valley this 24 th day of July, ATTEST: Art Bishop, Mayor La Vonda M-Pearson, Town Clerk Council Meeting Date: 7/24/

15 RESOLUTION NO RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF APPLE VALLEY APPROVING, AUTHORIZING, AND DIRECTING EXECUTION OF A JOINT EXERCISE OF POWERS AGREEMENT RELATING TO THE CALIFORNIA MUNICIPAL FINANCE AUTHORITY; CONSENTING TO THE INCLUSION OF PROPERTIES WITHIN THE TERRITORY OF THE TOWN IN THE CALIFORNIA MUNICIPAL FINANCE AUTHORITY OPEN PACE PROGRAMS; AUTHORIZING THE CALIFORNIA MUNICIPAL FINANCE AUTHORITY TO ACCEPT APPLICATIONS FROM PROPERTY OWNERS, CONDUCT CONTRACTUAL ASSESSMENT PROCEEDINGS AND LEVY CONTRACTUAL ASSESSMENTS WITHIN THE TERRITORY OF THE TOWN; AND AUTHORIZING RELATED ACTIONS WHEREAS, the California Municipal Finance Authority (the Authority ) is a joint exercise of powers authority, the members of which include numerous cities and counties in the State of California (the Members ), formed pursuant to a Joint Exercise of Powers Agreement Relating to the California Municipal Finance Authority, dated as of January 1, 2004 (the Agreement ) for the purpose of promoting economic, cultural and community development and in order to exercise any powers common to its Members, including the issuance of bonds, notes or other evidences of indebtedness; and WHEREAS, Town of Apple Valley (the Town ), has determined that it is in the public interest and for the public benefit that the Town become a Member of the Authority in order to facilitate the promotion of economic, cultural and community development activities in the Town, including the financing of projects therefor by the Authority; and WHEREAS, there is now before this Town Council the form of the Agreement; and WHEREAS, the Agreement has been filed with the Town, and the members of the Town Council, with the assistance of its staff, have reviewed said document; and WHEREAS, the Authority is implementing Property Assessed Clean Energy (PACE) programs, which it has designated CMFA Open PACE, consisting of CMFA Open PACE programs each administered by a separate program administrator (collectively with any successors, assigns, replacements or additions, the Programs ), to allow the financing or refinancing of renewable energy, energy efficiency, water efficiency and seismic strengthening improvements, electric vehicle charging infrastructure and such other improvements, infrastructure or other work as may be authorized by law from time to time (collectively, the Improvements ) through the levy of contractual assessments pursuant to Chapter 29 of Division 7 of the Streets & Highways Code ( Chapter 29 ) within counties and cities throughout the State of California that consent to the inclusion of Council Meeting Date: 7/24/

16 properties within their respective territories in the Programs and the issuance of bonds from time to time; and WHEREAS, the program administrators currently active in administering Programs are Energy Efficient Equity, Inc.; BlueFlame PACE Services LLC; OnPACE Energy Solutions, LLC; PACE Equity, LLC; Petros PACE Administrator, LLC; Samas Capital LLC; Structured Finance Associates, LLC; and Twain Community Partners II LLC; and the Authority will notify the Town in advance of any additions or changes; and WHEREAS, Chapter 29 provides that assessments may be levied under its provisions only with the free and willing consent of the owner or owners of each lot or parcel on which an assessment is levied at the time the assessment is levied; and WHEREAS, the Town desires to allow the owners of property ( Participating Property Owners ) within its territory to participate in the Programs and to allow the Authority to conduct assessment proceedings under Chapter 29 within its territory and to issue bonds to finance or refinance Improvements; and WHEREAS, the territory within which assessments may be levied for the Programs shall include all of the territory within the Town s official boundaries; and WHEREAS, the Authority will conduct all assessment proceedings under Chapter 29 for the Programs and issue any bonds issued in connection with the Programs; and WHEREAS, the Town will not be responsible for the conduct of any assessment proceedings; the levy of assessments; any required remedial action in the case of delinquencies in such assessment payments; or the issuance, sale, administration repayment or guarantee of any bonds issued in connection with the Programs; WHEREAS, the Authority and its program administrators shall be prohibited from charging prepayment penalties on a PACE assessment resulting from any CMFA Open PACE program; and WHEREAS, the Authority, program administrators and all affiliated subcontractors are prohibited from using the official Town logo or in any other way marketing CMFA Open PACE programs as Town or Town-endorsed programs. NOW, THEREFORE, BE IT RESOLVED by the Town Council of the Town of Apple Valley as follows: Council Meeting Date: 7/24/

17 Section 1. This Town Council hereby finds and declares that the foregoing recitals are true and correct. Section 2. The Agreement is hereby approved and the Mayor, Town Manager, or the designee thereof is hereby authorized and directed to execute said document, and the Town Clerk or such clerk s designee is hereby authorized and directed to attest thereto. Section 3. This Town Council hereby finds and declares that properties in the territory of the Town will benefit from the availability of the Programs within the territory of the Town and, pursuant thereto, the conduct of special assessment proceedings by the Authority pursuant to Chapter 29 and the issuance of bonds to finance or refinance Improvements. Section 4. In connection with the Programs, the Town hereby consents to the conduct of special assessment proceedings by the Authority pursuant to Chapter 29 on any property within the territory of the Town and the issuance of bonds to finance or refinance Improvements; provided, that (1) The Participating Property Owners, who shall be the legal owners of such property, execute a contract pursuant to Chapter 29 and comply with other applicable provisions of California law in order to accomplish the valid levy of assessments; and (2) The Town will not be responsible for the conduct of any assessment proceedings; the levy of assessments; any required remedial action in the case of delinquencies in such assessment payments; or the issuance, sale, administration, repayment or guarantee of any bonds issued in connection with the Programs. Section 5. The appropriate officials and staff of the Town are hereby authorized and directed to make applications for the Programs available to all property owners who wish to finance or refinance Improvements; provided, that the Authority shall be responsible for providing such applications and related materials at its own expense. The following staff persons, together with any other staff persons chosen by the Town Manager of the Town from time to time, are hereby designated as the contact persons for the Authority in connection with the Programs: Special Projects Manager. Section 6. The appropriate officials and staff of the Town are hereby authorized and directed to execute and deliver such certificates, requisitions, agreements and related documents as are reasonably required by the Authority to implement the Programs. Section 7. The Town Council hereby finds that adoption of this Resolution is not a project under the California Environmental Quality Act, because the Resolution does not involve any commitment to a specific project which may result in a potentially significant Council Meeting Date: 7/24/

18 physical impact on the environment, as contemplated by Title 14, California Code of Regulations, Section 15378(b)(4)). Section 8. The Town reserves the right to withdraw consent of inclusion of properties within its jurisdictional boundaries at any time through written notice to the Authority or any individual program administrator, and the Authority and program administrators agree to discontinue processing of new applications within the Town s jurisdictional boundaries immediately upon receipt of such notice. The Town s withdrawal from any Program shall not affect the validity of any voluntary assessment contract entered into prior to the date of such withdrawal or entered into after the date of such withdrawal so long as the application for such voluntary assessment contract was submitted to and approved by the Authority prior to the date of the Town s notice of withdrawal. Section 9. This Resolution shall take effect immediately upon its adoption, and the Town Clerk is hereby authorized and directed to transmit a certified copy of this resolution to the Financial Advisor of the Authority at: California Municipal Finance Authority, 2111 Palomar Airport Road, Suite 320, Carlsbad, California, 92011, Attn: Travis Cooper. APPROVED and ADOPTED by the Town Council of the Town of Apple Valley this 24 th day of July, ATTEST: Art Bishop, Mayor La Vonda M-Pearson, Town Clerk Council Meeting Date: 7/24/

19 RESOLUTION NO A RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF APPLE VALLEY, CALIFORNIA, APPROVING ASSOCIATE MEMBERSHIP BY THE TOWN IN THE CALIFORNIA ENTERPRISE DEVELOPMENT AUTHORITY; AUTHORIZING AND DIRECTING THE EXECUTION OF AN ASSOCIATE MEMBERSHIP AGREEMENT RELATING TO ASSOCIATE MEMBERSHIP OF THE TOWN IN THE AUTHORITY; AUTHORIZING THE TOWN TO JOIN THE FIGTREE PACE PROGRAM; AUTHORIZING THE CALIFORNIA ENTERPRISE DEVELOPMENT AUTHORITY TO CONDUCT CONTRACTUAL ASSESSMENT PROCEEDINGS AND LEVY CONTRACTUAL ASSESSMENTS WITHIN THE TERRITORY OF THE TOWN OF APPLE VALLEY; AND AUTHORIZING RELATED ACTIONS WHEREAS, the Town of Apple Valley, California (the Town ), a municipal corporation, duly organized and existing under the Constitution and the laws of the State of California; and WHEREAS, the Town, upon authorization of the Town Council, may pursuant to Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California, commencing with Section 6500 (the "JPA Law") enter into a joint exercise of powers agreement with one or more other public agencies pursuant to which such contracting parties may jointly exercise any power common to them; and WHEREAS, the Town and other public agencies wish to jointly participate in economic development financing programs for the benefit of businesses and nonprofit entities within their jurisdictions offered by membership in the California Enterprise Development Authority (the "CEDA") pursuant to an associate membership agreement and Joint Exercise of Powers Agreement Relating to the California Enterprise Development Authority (the Agreement ); and WHEREAS, under the JPA Law and the Agreement, CEDA is a public entity separate and apart from the parties to the Agreement and the debts, liabilities and obligations of CEDA will not be the debts, liabilities or obligations of the Town or the other members of the Authority; and WHEREAS, the form of Associate Membership Agreement (the Associate Membership Agreement ) between the Town and CEDA is attached; and WHEREAS, the Town is willing to become an Associate Member of CEDA subject to the provisions of the Associate Membership Agreement; and Council Meeting Date: 7/24/

20 WHEREAS, CEDA has adopted the Figtree Property Assessed Clean Energy (PACE) and Job Creation Program (the Program or Figtree PACE ), to allow the financing of certain renewable energy, energy efficiency, seismic retrofits, electric vehicle charging infrastructure, and water efficiency improvements (the "Improvements") through the levy of contractual assessments pursuant to Chapter 29 of Division 7 of the Streets & Highways Code ("Chapter 29"), and the issuance of improvement bonds or other evidences of indebtedness (the "Bonds") under the Improvement Bond Act of 1915 (Streets and Highways Code Sections 8500 et seq.) (the "1915 Act") upon the security of the unpaid contractual assessments; and WHEREAS, Chapter 29 provides that assessments may be levied under its provisions only with the free and willing consent of the owner of each lot or parcel on which an assessment is levied at the time the assessment is levied; and WHEREAS, the Town desires to allow the owners of property ( Participating Parcel ) within its jurisdiction ("Participating Property Owners") to participate in Figtree PACE, and to allow CEDA to conduct assessment proceedings under Chapter 29 and to issue Bonds under the 1915 Act to finance the Improvements; and WHEREAS, CEDA will conduct assessment proceedings under Chapter 29 to establish an assessment district (the District ) and issue Bonds under the 1915 Act to finance Improvements; and WHEREAS, there has been presented to this meeting a proposed form of Resolution of Intention to be adopted by CEDA in connection with such assessment proceedings (the "ROI"), a copy of which is attached hereto as Exhibit A; and WHEREAS, said ROI sets forth the territory within which assessments may be levied for Figtree PACE which territory shall be coterminous with the Town's official boundaries of record at the time of adoption of the ROI (the "Boundaries"); and WHEREAS, pursuant to Chapter 29, the Town authorizes CEDA to conduct assessment proceedings, levy assessments, pursue remedies in the event of delinquencies, and issue bonds or other forms of indebtedness to finance the Improvements in connection with Figtree PACE; and WHEREAS, to protect the Town in connection with operation of the Figtree PACE program, Dividend Finance, LLC, the program administrator, has agreed to defend and indemnify the Town; and Council Meeting Date: 7/24/

21 WHEREAS, the Town will not be responsible for the conduct of any assessment proceedings, the levy of assessments, any required remedial action in the case of delinquencies, the issuance, sale or administration of the bonds or other indebtedness issued in connection with Figtree PACE; and WHEREAS, the Authority and its program administrators shall be prohibited from charging prepayment penalties on a PACE assessment resulting from any Figtree PACE program; and WHEREAS, the Authority, program administrators and all affiliated subcontractors are prohibited from using the official Town logo or in any other way marketing the Figtree PACE programs as Town or Town-endorsed programs. NOW, THEREFORE, BE IT RESOLVED, that the Town Council of the Town of Apple Valley, hereby finds, determines and declares as follows: Section 1. The Town Council hereby specifically finds and declares that the actions authorized hereby constitute public affairs of the Town. The Town Council further finds that the statements, findings and determinations of the Town set forth in the preambles above are true and correct. Section 2. The Associate Membership Agreement presented to this meeting and on file with the Town Clerk is hereby approved. The Mayor of the Town, the Town Manager, the Town Clerk and other officials of the Town are each hereby authorized and directed, for and on behalf of the Town, to execute and deliver the Associate Membership Agreement in substantially said form, with such changes therein as such officer may require or approve, such approval to be conclusively evidenced by the execution and delivery thereof. Section 3. The officers and officials of the Town are hereby authorized and directed, jointly and severally, to do any and all things and to execute and deliver any and all documents which they may deem necessary or advisable in order to consummate, carry out, give effect to and comply with the terms and intent of this resolution and the Associate Membership Agreement. All such actions heretofore taken by such officers and officials are hereby confirmed, ratified and approved. Section 4. Good Standing. The Town is a municipal corporation and in good standing. Section 5. Public Benefits. On the date hereof, the Town Council hereby finds and determines that the Program and issuance of Bonds by CEDA in connection with Council Meeting Date: 7/24/

22 Figtree PACE will provide significant public benefits, including without limitation, savings in effective interest rates, bond preparation, bond underwriting and bond issuance costs and reductions in effective user charges levied by Town providers within the boundaries of the Town. Section 6. Assessment Proceedings. In connection with Figtree PACE, the Town hereby consents to the special assessment proceedings by CEDA pursuant to Chapter 29 on any property within the Boundaries and the issuance of Bonds under the 1915 Act, provided that: (1) Such proceedings are conducted pursuant to one or more Resolutions of Intention in substantially the form of the ROI; (2) The Participating Property Owners, who shall be the legal owners of such property, voluntarily execute a contract pursuant to Chapter 29 and comply with other applicable provisions of California law in order to accomplish the valid levy of assessments; and (3) The Town will not be responsible for the conduct of any assessment proceedings, the levy of assessments, any required remedial action in the case of delinquencies in such assessment payments, or the issuance, sale or administration of the Bonds in connection with Figtree PACE. Section 7. Program Report. The Town Council hereby acknowledges that pursuant to the requirements of Chapter 29, CEDA has prepared and will update from time to time the "Program Report" for Figtree PACE (the "Program Report") and associated documents, and CEDA will undertake assessment proceedings and the financing of Improvements as set forth in the Program Report. Section 8. The Town reserves the right to withdraw consent of inclusion of properties within its jurisdictional boundaries at any time through written notice to the Authority or any individual program administrator, and the Authority and program administrators agree to discontinue processing of new applications within the Town s jurisdictional boundaries immediately upon receipt of such notice. Section 9. Town Contact Designation. The appropriate officials and staff of the Town are hereby authorized and directed to make applications for Figtree PACE available to all property owners who wish to finance Improvements. The following staff persons, together with any other staff designated by the Town Manager from time to time, are hereby designated as the contact persons for CEDA in connection with Figtree PACE: Special Projects Manager. Section 10. CEQA. The Town Council hereby finds that adoption of this Resolution is not a "project" under the California Environmental Quality Act ( CEQA ), because the Resolution does not involve any commitment to a specific project which may result in a Council Meeting Date: 7/24/

23 potentially significant physical impact on the environment, as contemplated by Title 14, California Code of Regulations, Section 15378(b )( 4)). Section 11. Effective Date. This Resolution shall take effect immediately upon its adoption. The Town Clerk is hereby authorized and directed to transmit a certified copy of this resolution to Dividend Finance, LLC. Section 12. Costs. Services related to the formation and administration of the assessment district will be provided by CEDA at no cost to the Town. APPROVED and ADOPTED by the Town Council of the Town of Apple Valley this 24 th day of July, ATTEST: Art Bishop, Mayor La Vonda M-Pearson, Town Clerk Council Meeting Date: 7/24/

24 ASSOCIATE MEMBERSHIP AGREEMENT by and between the CALIFORNIA ENTERPRISE DEVELOPMENT AUTHORITY and the TOWN OF APPLE VALLEY, CALIFORNIA THIS ASSOCIATE MEMBERSHIP AGREEMENT (this Associate Membership Agreement ), dated as of by and between CALIFORNIA ENTERPRISE DEVELOPMENT AUTHORITY (the Authority ) and the TOWN OF APPLE VALLEY, CALIFORNIA, a municipal corporation, duly organized and existing under the laws of the State of California (the Town ); WITNESSETH: WHEREAS, the Cities of Selma, Lancaster and Eureka (individually, a Member and collectively, the Members ), have entered into a Joint Powers Agreement, dated as of June 1, 2006 (the Agreement ), establishing the Authority and prescribing its purposes and powers; and WHEREAS, the Agreement designates the Executive Committee of the Board of Directors and the President of the California Association for Local Economic Development as the initial Board of Directors of the Authority; and WHEREAS, the Authority has been formed for the purpose, among others, to assist for profit and nonprofit corporations and other entities to obtain financing for projects and purposes serving the public interest; and WHEREAS, the Agreement permits any other local agency in the State of California to join the Authority as an associate member (an Associate Member ); and WHEREAS, the Town desires to become an Associate Member of the Authority; and WHEREAS, Town Council of the Town has adopted a resolution approving the Associate Membership Agreement and the execution and delivery thereof; and WHEREAS, the Board of Directors of the Authority has determined that the Town should become an Associate Member of the Authority. Council Meeting Date: 7/24/

25 NOW, THEREFORE, in consideration of the above premises and of the mutual promises herein contained, the Authority and the Town do hereby agree as follows: Section 1. Associate Member Status. The Town is hereby made an Associate Member of the Authority for all purposes of the Agreement and the Bylaws of the Authority, the provisions of which are hereby incorporated herein by reference. From and after the date of execution and delivery of this Associate Membership Agreement by the Town and the Authority, the Town shall be and remain an Associate Member of the Authority. Section 2. Restrictions and Rights of Associate Members. The Town shall not have the right, as an Associate Member of the Authority, to vote on any action taken by the Board of Directors or by the Voting Members of the Authority. In addition, no officer, employee or representative of the Town shall have any right to become an officer or director of the Authority by virtue of the Town being an Associate Member of the Authority. Section 3. Effect of Prior Authority Actions. The Town hereby agrees to be subject to and bound by all actions previously taken by the Members and the Board of Directors of the Authority to the same extent as the Members of the Authority are subject to and bound by such actions. Section 4. No Obligations of Associate Members. The debts, liabilities and obligations of the Authority shall not be the debts, liabilities and obligations of the Town. Section 5. Execution of the Agreement. Execution of this Associate Membership Agreement and the Agreement shall satisfy the requirements of the Agreement and Article XII of the Bylaws of the Authority for participation by the Town in all programs and other undertakings of the Authority. IN WITNESS WHEREOF, the parities hereto have caused this Associate Membership Membership Agreement to be executed and attested by their proper officers thereunto duly authorized, on the day and year first set forth above. CALIFORNIA ENTERPRISE DEVELOPMENT AUTHORITY Attest: By: Gurbax Sahota, Chair Board of Directors Helen Schaubmayer, Asst. Secretary Council Meeting Date: 7/24/

26 TOWN OF APPLE VALLEY, CALIFORNIA By: Mayor ATTEST: Town Clerk Council Meeting Date: 7/24/

27 RESOLUTION NO RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF APPLE VALLEY, CALIFORNIA, CONSENTING TO INCLUSION OF PROPERTIES WITHIN THE TOWN S JURISDICTION IN THE GOLDEN STATE FINANCE AUTHORITY PROGRAM TO FINANCE RENEWABLE ENERGY GENERATION, ENERGY AND WATER EFFICIENCY IMPROVEMENTS, ELECTRIC VEHICLE CHARGING INFRASTRUCTURE, AND OTHER IMPROVEMENTS AND APPROVING ASSOCIATE MEMBERSHIP IN THE JOINT EXERCISE OF POWERS AUTHORITY RELATED THERETO WHEREAS, the Golden State Finance Authority ( Authority ) is a joint exercise of powers authority established pursuant to Chapter 5 of Division 7, Title 1 of the Government Code of the State of California (Section 6500 and following) (the Act ) and the Joint Power Agreement entered into on July 1, 1993, as amended from time to time (the Authority JPA ); and WHEREAS, Authority has established a property-assessed clean energy ( PACE ) Program (the Authority PACE Program ) to provide for the financing of renewable energy generation, energy and water efficiency improvements, electric vehicle charging infrastructure, and other improvements (the Improvements ) pursuant to Chapter 29 of the Improvement Bond Act of 1911, being Division 7 of the California Streets and Highways Code ( Chapter 29 ) within counties and cities throughout the State of California that elect to participate in such program; and WHEREAS, Town of Apple Valley (the Town ) is committed to development of renewable energy generation and energy and water efficiency improvements, reduction of greenhouse gases, and protection of the environment; and WHEREAS, in Chapter 29, the Legislature has authorized cities and counties to assist property owners in financing the cost of installing Improvements through a voluntary contractual assessment program; and WHEREAS, installation of such Improvements by property owners within the jurisdictional boundaries of the counties and cities that are participating in the Authority PACE Program would promote the purposes cited above; and WHEREAS, the Town wishes to provide innovative solutions to its property owners to achieve energy and water efficiency, and in doing so cooperate with Authority in order to efficiently and economically assist property owners within the Town in financing such Improvements; and WHEREAS, Authority has established the Authority PACE Program, which is such a voluntary contractual assessment program, as permitted by the Act, the Authority JPA, originally made and entered into July 1, 1993, as amended to date, and the Council Meeting Date: 7/24/