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Home My WebLink About2013/08/13 Item 09CITY COUNCIL AGENDA STATEMENT ~~ CITY OF CHUTA VI57A 8/13/13, Item ~/ ITEM TITLE: RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA AMENDING THE FISCAL YEAR 2014 BUDGET TO APPROPRIATE 523,853 h\T COMMUIITY LOAI~T REPAYMENTS INTO THE "OTHER EXPENSES" BUDGET CATEGORY OF THE AA~ERICAI~' RECOVERY R REII~TVESTNIENT ACT FUND TO CONTIi~iiJE OFFERIi~iG LOW- INTEREST ENERGY iiPGRADE FINAi\TCING TO RESIDENTS THROUGH THE CHULA VISTA HOME UPGRADE; CARBON DOWI~'GRADE PROGRAM SUBMITTED BY: DIRECTOR OF PUBLIC R%ORKS I~~ ,'`[ ADMINISTRATIVE E VICES A4ANAGER 1~~ REVIEWED BY: CITY A'IAi\'AGE ASSISTANT CITY 4ANAGER~ 4/STHS VOTE: YES ~ NO SL1~~IARY As part of the 2009 American Recovery & Reinvestment Act; the Cit}~ of Chula Vista received Energy Efficiency & Conservation Block Grant funding to facilitate energy use reductions at municipal facilities and throughout the community. A portion of the funding v\~as used to create a revohins loan fund within the City's Home Upgrade, Carbon DoN~ngrade program to provide low- interest financine to communirv members for home energy up~ades. Over $200;000 of loan funds have been distributed to community members to install more efficient insulation, hot water heaters, air conditioners, furnaces, and solaz photovoltaic panels. .The City has received 523;853 in loan repaytrtents; which it is now seeking to reim~est in the revolving loan fund to continue offering community energy upgrade loans. E\~'IROi\~IENT.AL REVIE«' The Development Services Director has reviewed the proposed activity for compliance with the California Environmental Qualih~ Act (CEQA) and has determined that the activity qualifies for a Class 8 categorical exemption pursuant to Section 15308 [Actions by Regulatory Agencies for Protection of the Environment] of the State CEQA Guidelines; because the proposed action trill facilitate energy efficiency and renewable energy improvements in the community, which helps to reduce greenhouse gas emissions and improve local air quality. Thus, no further em irorunental review is required. RECO~LI4E\'DATIO\~ Council adopt the resolution. 9-1 8/13113, Item q Page 2 of 2 BOARDS/COMMISSION' RECOMMENDATION Not applicable. DISCUSSION As part of the American Recovery & Reinvestment Act of 2009, the City of Chula Vista was allocated $1;974;300 of Energy Efficiency & Conservation Block Grants (EECBG) to implement strategies to reduce energ}' use and lower fossil fuel emissions (Resolution #2009-256). A key component of the City's EECBG implementation was establishing the Chula Vista Home Upgrade, Carbon DoNmgrade program. The program was designed to facilitate home energy upgrades by offering point-of--sale rebates for energy-efficient appliances, incentives for performing whole-home energy upgrades, and low-interest community financing (through a revolving loan fund) for no upfront cost options for homeowners. Over $200,000 of revolving loan funds have now been distributed to community members to complete home energy upgrades. Common upgrades include the installation of more efficient insulation; hot water heaters; air conditioners, furnaces, and solaz photovoltaic panels. Cumulatively, these projects have leveraged $37,750 in state incentives and reduced local energy use by approximately li,242 kWh and 2,488 therms. The City has received $23,853 in loan repayments from the past projects and is now seeking to reinvest the payments into the revolving loan fund to continue offering community energy upgrade loans. It is expected that three new community projects will be funded over the next six months with the reinvested funds. Because the initial funding came through the federal stimulus bill, the options for using repayments is limited to reinvesting them in the revolving loan fund or returning them to the Department of Energy. DECISION MAKER CONFLICT Staff has reviewed the decision contemplated by this action and has determined that it is not site specific and consequently; the 500-foot rule found in California Code of Regulations section 18704.2(a)(1) is not applicable to this decision. Staff is not independently aware, nor has staff been informed by any City Councilmember, of any other fact that may constitute a basis for a decision maker conflict of interest in this matter. CURRENT YEAR FISCAL IMPACT There is no fiscal impact to the City's General Fund as a result of the proposed action. New communih' energy upgrade loans issued through the Honae Upgrade, Carbon Downgrade program will be completely offset by the repayments of previous community loans. ONGOING FISCAL IMPACT There is no ongoing fiscal impact to the City's General Fund as a result of the proposed action. ATTACHMENTS Attachment 1 - HUCD Revoh'ing Loan Pund Program Plan Prepared by: Brendan Reed, Environmenra( Resource Manager, Public 17%rks -Conservation Section H:I PUBLIC WORKS- ENGUGE:\'D_AIC.4S20131REPORT-PW-Revolving Loan Fund Repayment Appropriatiort_FIh'AL2.doc 9-2 - - ah - - r! r Home Carboni Upgrade Downgrade CHLLLA VISTA CO?~~7UI~ZTY REVOLVING LOAN FUND Program Plan PROGRa.~1 GOAL The Home Upgrade, Carbon Downgrade (HU/CD) Communit}= Revoh=ing Loan Fund's coal is to provide low interest financing for propem-o~vers to implement energy efficiency retrofiu and/or to install renewable energ}= systems at their homes or businesses in Chula Vista to help reduce utility cosu; while leveraging existing federal and state rebate opportunities and contributing to the Cit}='s environmental goals. Retrofit nroiecu. which-save at least 10 million BTU (eouivalent to annroximateh~ 3.000 k~4%h or 100 thermsl oer 51 000 snent and have a payback period of ~ years or less. mill be prioritized. The program is funded by the American Recovery & Reinvestment Act under the auspices of the Department of Energ}=. FINA~CL~'G STRLiCTURE The City will use up to $390;000 of its Energ}= Efficiency & Conservation Block Granu to provide the initial capitalization for the revolving loan. Loan interest mill be initially set between 0% - 3% (simple annual rate) v<ith loan amounu ransing from 52,00 - S2d;000. The Cit}= of Chula Vista reserves the right to change loan interest rates. Additional processing fees of 5180 for loan set-up and 59.0/month for loan processing will also be applied to each loan. Loan recipienu will be required to sign a Promissory Note and a lien (Deed of Trust) will be placed on the property which must be in second position or higher. The loan's amortization schedule will be structured by the City so that montlilv repaymenu aze annroximateh~ equip alent to the retrofit projects estimated utility cost savings. Hoy;=ever; the maximum loan term will be capped at 10 years. P.-~RTICIP.~,NT ELIGIBILITY' In order for apropem=-owner to be approved for a loan; all of the following conditions must be met: 1. The propem= is located within the City of Chula Vista 2. Propem=-owner is current on mortgage(s) and propem= taxes 3. Propem=-owner is not in bankruptcy and the propem= is not an asset in bankruptc} 4. Requested loan amount does not exceed 10% of the propem value ~. Lien to value ratio (including the requested loan amount) does not exceed 100% Hli/CD Communirv Revolvine Loan Fund 1 of 5 Pro3aID Plan (v 7/]6/Li) o_o 6. Improvements aze for existine buildings and result in long-term reductions in energy use (see Eligible Improvements List) 7. Contractor(s) selected to perform the property improvement are on the City's Home Upgrade, Carbon Downgrade Eligible Contractor List and meet certain labor, qualitti~ assurance; and liabiliri~ requirements ELIGIBLE LMPROVEI\'IENTS LIST The follo~~ng energy efficiency and renewable energy improvements are eligible for fmancing under the Home Upgrade, Carbon Downgrade (HtJ/CD) Community Revoh~ing Loan Pro gram: _ .-~ - .- Attic Insulation R-30 rating or greater Yes Exempt ii Central Air Conditioning/Heat Pump SEER 14 or greater _ Yes Exempt Central Furnace (Natural Gas) 92% AFUE rating or greater Yes Exempt Cool Roof Flat Roof: 75% Reflectively & Emissivity or greater Yes ', Steep Roof: 40% Reflectivity & 75% Emissivity or greater (if 45 years old) ~. ~ Energy Upgrade CA -Whole Home Retrofits' Basic Package or Advanced Package Yes Yes (if 45 years old) ~~~ Programmable Thermostat ENERGY STAR-qualified model -- Exempt Solar Hot Water' SRCC OG-300 certifed (single-family) - Yes Yes SRCC OG-100 certified (multi-family 8 commercial) (if 45 years old) Solar Photovoltaic (PV)" System size can noY exceed on-site energy demand ~ Yes Yes (if 45 years old) Tankless, On-Demand Water Heater 0.90 EF rating or greater Exempt Wall Insulation R-13 rating or greater Yes Exempt Water Heater (Eledric) 0.93 EF rating or greater (>30-gallon capacty) Yes Exempt Water Heater (Natural Gas) 0.62 EF rating or greater (?30-gallon capacity)- Yes Exempt Whole House Fan Must have existing central A/C system ~ Yes Exempt Windows 0.40 U value 8 Solar Heat Gain Coefficient (SHGC) or less Yes (rf 45 years old) Other Energy-Efficiency Measures Reviewed on a case-by-case basis _ - Yes (if 45 years old) 'Financing is not available for swimming pool-related energy improvements (such as solar heating or pool pumps) "A minimum building energy effciency level must be met before fnancing solar photovoltaic systems ENERGY EFFICIENCY PREREQUISITES FOR SOLAR PV FINANCING In order for property-owners to finance Solaz PV systems using the Revolving Loan Fund, previous home energy efficiency improvements must have been completed or must be part of the proposed home improvement project. Specifically, property-owners will be requ ired to demonstrate minimum energy efficiency performance either one of two ways: 1) Propert}~-owners must participate in the statewide Energy Upe •ade California Advanced Package (Performance Approach) program, which incorporates energy auditi ng and HU/CD Community Revolving Loan Fund 2 of 5 Program Plan (v 7/16/li) 9-4 testing. and must meet a m;n;mum verified, energy efficiency improvement of 10% for the whole home. OR 2) Propem-owners must demonstrate that their homes have at least 10% lower energy intensity (calculated by dividing their home's annual energy consumption (kR1t) by the size of the home (sq ft)) than the averaee Chula Vista home or that their homes have a HERS Index Score of 90 or below (equivalent to 10% better than State code). Additionally, only 2~% of total program funds loaned out to date can be used for financing Solaz PV. To request current program funding levels; please contact Cony Dow~rts at 619-476-242 or cdouns(a~chulavistaca. eov. APPLICATION DOCU1~gNTS Applications are avaIlable for download at t~lvvv.chulavistacaeov/soto/IILiCD. Copies of the folloning documents must be submitted w7th ati application: • Completed & signed application • (3) convactor bid estimates which include all revofit measures (recommended) • Cope of Deed of Trust • Copy of most recent Mortgage Statement A~~ Propem' Tax Bill • Evidence of Property Insurance (must be compliant with all policti~ requirements) • Copy of completed SDG&E Online Energy Efficiency Survey • Completed & signed SDG&E Authorization to Release Customer Info form APPLICATION PROCESS STEP 1 STEP 2 STEP 3 I I STEP -t APPLIC.4T10\r REY7EW- • Propem' owner • City staff reviews receives (3) bids application & makes from eligible approvals based on contractors ener~~savings (recommended) 's-::= thresholds R • Propem' o~mer pa}'back period (see chooses a p. I) contractor & • If approved. City submits a loan staff sends a T~orice application for ofAu~ord to desired enerw- Applicant who siatts ravine retrofts R notarizes • Propem' owner Promissory Note R includes required Deed of Trust documents with • .Applicant sent a submitted loan ?~~otice to Proceed annliratinn by Cih' when loan documents have been finalized HIJ/CD Commun in• Rev olving Loan Fund Pro3dID Plan (v 7 /16/li ) RETROFITS L0.4~rSERY7C7.~'G • Applicant work • Del Toro Loan with contractor to Sen~icing; Inc. complete retrofiu will provide • Applicant signs off monthh~ bills, on Request for _~~~ annual statements; Pm~ment once work payoff demands; is completed & require annual • Citv staff schedules insurance from 8 completes a final loan recipients inspection • Payment by the Cin_• to Propem• Owner or Contractor 3 of 5 APPLICATION SUBMITTAL Completed applications along with the necessary support documentation should be emailed to Conservation a(~chulavistacasov or mailed to: Attn: HU/CD Community Revolving Loan Program Conservation Section 276 Fourth Avenue Chula Vista. CA 91910 RLF staff will contact the applicants to let them know if their application is approved, if further information is required, or if the program is not able to fund their improvements at this time. Once all loan funds have been appropriated, future applicants will be placed on a waiting list. Propert}=-owners on the waiting list aze also encouraged to investigate other burrowine opportunities through private financing institutions such as local credit unions and banks or through City-sponsored Property Assessed Clean Energy (PACE) financing. Property-owners whose applicant has not been approved by City staff aze able to file ari appeal to the Resource Conservation Commission for reconsideration of their loan application (an extra fee may apply). ADDITIONAL LOAN TERMS & CONDITIONS Property-owners must meet and agree to the following terms and conditions to be eligible to participate in the Cit}=-sponsored loan program: • Loans are non-transferable; available until program funds aze exhausted, and interest rates/processing fees aze subject to change. • Any utility; state, or federal efficiency rebates must be applied to the overall project costs and deducted from the requested financing amount. • After a tl'otice to Proceed is issued by the City, the property-owner will have 90-days to complete the approved retrofit measures and submit the Request for Payment. • Any construction debris must be properly disposed and iecycled as outlined in the City of Chula Vista Municipal Code Section 8.25.095 and must comply w=ith all other local; state, and federal regulations for proper waste disposal. • It is the property-ow=ner`s responsibility to contract with the contractor and to assume responsibility for the work to be performed. • In the event that the work is not performed to the satisfaction of the applicant, it is the property-owner's responsibility to resolve any dispute that may occur betty=een the propem-owner and the contractor. • The Home Upgrade, Carbon Downgrade (HU/CD) Community= Revolving Loan Program is not responsible for the contract that is entered into by both parties and the City of Chula Vista w=ill not get involved in applicant and contractor disputes. • The property=-owner waives and releases the City of Chula V"ista, and its program partners which include (but are not limited to) San Diego Gas & Electric, from any and all claims and causes of action arising out of the retrofit project. • The property-owner shall defend. indemnify, protect, and hold harmless the City, its elected and appointed officers and employees, from and against all claims for damages; liability, cost; and expense arising out of or alleged by third parties to be the result of the negligent acts; errors or omissions or the willful misconduct of the property-owner. • The property=-owner grants the City= of Chula Vista, or its representatives, the right to verify= and inspect installed energy= retrofit measures. FIU/CD Communirv Revolvine Loan Fund 4 of 6 Program Plan (v 7/16/li) 9- 6 • The propem~-o~;ver granu the Cin of Chula \%ista, or iu representatives; authorization to access thew energy consumption data from San Diego Gas & Electric throughout the loan term. PROGR~~4 CONTACTS Conservar.'on Section Public Yl~orks Department 619-409-3893 Phone 619-476-5310 Fax ~~s~ .chu lavistaca. eov/c] ean Brendan Reed 619-409-5889 breed(c~chul avistaca. eov Con' Downs 619-476-2442 cdowns(a~chulavistaca. eov HLi/CD Communirv Revolving Loan Fund 5 of 5 Program Plan (~• i/16/13) n ~ RESOLUTION NO. 2013- RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA AA7ENDING THE FISCAL YEAR 2014 BUDGET TO APPROPRIATE $23;8~3 IN COMMUNITY LOAN REPAYMENTS INTO THE "OTHER EXPENSES" BUDGET CATEGORY OF THE AMERICAN RECOVERY & REIt\TVESTMENT ACT FUND TO CONTINUE OFFERING LOW-INTEREST ENERGY UPGRADE FINANCING TO RESIDENTS THROUGH THE CHULA VISTA ~ HOME UPGRADE. CARBON DOVvR~IGRADE PROGRAM ~y~HEREAS; as part of the American Recovery & Reinvestment Act of 2009. the City of Chula Vista was allocated Enersy Efficiency & Conservation Block Grants (EECBG) to implement strategies to reduce energy use and lower_ fossil fuel emissions (Resolution #2009-2~6); and WHEREAS; a key component of the City's EECBG implementation was establishing the Chula Vista HonJe Upgrade, Carbon DoN'ngrade program to facilitate home energy upgrades: and WHEREAS; a portion of the Honae Upgrade, Curbori Do>nngrude program funding was used to create a revolving loan fund to provide low-interest financing to community members: and WHEREAS, over $200;000 of loan funds have been distributed to community members to install more efficient insulation, hot water heaters. air conditioners. furnaces. and solar photovoltaic panels; and WHEREAS, the City has received $23;853 in loan repayments from the past projects. which it now seeks to reinvest into the revolving loan fund to continue offering community energy upgrade loans. NOW, THEREFORE, the City Council of the City of Chula Vista does hereby resolve by way of 4/5`hs vote that it appropriates $23,853 in community loan repayments into the "Other Expenses'' budget category of the American Recovery & Reinvestment Act Fund. Presented by Richard A. Hopkins Director of Public yy~orks Approved as to form by C--"~~ Glen R. Googins i~ ~°67 "'' ~{ City Attorney ~~ J:\AnorneyfflNAL RESOS AND ORDINANCES\2013\08 13 I3\ItESO-Pw-Revolving Loan Fund Repayment Appropri ati o n_FIIJAL. d o c 8/6/2013 8:36 AD1 9-$