It’s not easy being green, but Mo. legislation could make it cheaper for homeowners to try

By Sarah D. Wire, AP
Friday, April 16, 2010

Mo. homeowners could get help going green

JEFFERSON CITY, Mo. — Missouri homeowners could get help going green through a proposed financing program that would pay the upfront costs for energy efficiency improvements.

The program, called Property Assessed Clean Energy, would allow cities and counties to issue bonds so homeowners can make energy saving improvements to their home and have up to 20 years to pay off the loan through a special property tax assessment. The assessment is passed to the next owner if the home is sold.

Legislation to allow the program passed the House by a 137-9 vote Thursday. The Senate is considering a similar measure. The bill would also require new state buildings to meet certain energy standards and would outline registration of compost facilities.

The House legislation goes beyond the current incentives and aims to address the high upfront costs of installing energy efficiency measures such as insulation, storm windows, caulking or lighting. Originally implemented in Berkeley, Calif., in 2007, the financing method has been legalized in 19 states, including Vermont, Illinois, Texas, California and New York.

Missouri Municipal League legislative staff associate Patrick Bonnot said cities know people want to save on their energy bill, but “we often hear that residents can’t afford the one time cost.” The League has not voted whether to support the bill, but Bonnot said cities would likely support it.

Springfield based group Renew Missouri, which advocates for energy policy, says at least a dozen Missouri cities have expressed interest in the funding mechanism including St. Louis, Kansas City, Ferguson and Creve Coeur.

Renew Missouri spokesman Jason Hughes said the bill addresses common energy saving improvement roadblocks.

“The two issues you have is the upfront costs of installing it and then the long term, that in 3-4 years they move and still have a loan for the cost,” Hughes said. Energy efficient items tend to be more expensive, savings can take years to accumulate and experts recommend the improvements are completed all at once to maximize impact.

If the bill passes, most upfront costs would be taken care of and the new owners would take over the tax assessment if the house is sold.

The legislation requires the projects be financially feasible, meaning most projects would likely focus on energy conservation. Placing a $40,000 renewable energy system on a $100,000 house doesn’t make sense, Hughes said.

“It has to save you more than you’re spending,” he said. “It has to work financially.”

Cities in other states that provide loans have set homeowners standards such as no bankruptcy, no large mortgage and only improvements equal to 10 percent of the home’s value.

Missouri would allow cities and counties to opt into the program. Then the cities could issue bonds and assess the tax only on participating homeowners.

“It’s not like one person on the street does it and everyone’s taxes go up,” Hughes said.

Sponsoring Rep. Shane Schoeller, R-Willard, called the measure a local control issue because it is an agreement between cities and individual residents.

“It’s hard for me to see someone being against this,” Schoeller said. “It will be doing it the right way because it’s being done in the community. I want it to be done through the market and not through a government mandate and this is a good way to do that on the local level.”

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House version is HB1871

On the Net:

Legislature www.moga.mo.gov

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