Legislation introduced in the U.S. House of Representatives on July 20, 2011, seeks to give new life to the Property Assessed Clean Energy (PACE). PACE allows homeowners to finance energy improvements through financing by a local government that is paid back through a special assessment on their property taxes.
PACE faced opposition in the secondary mortgage market because, as a tax assessment, it took a priority in the repayment if the home went into foreclosure. In 2010 the Federal Housing Finance Administration (FHFA), Fannie Mae, Freddie Mac and the Office of the Comptroller of the Currency declared that PACE presented “significant safety and soundness concerns” to the secondary mortgage market and shut down its activity. These entities are all federal institutions.
The “PACE Assessment Protection Act” (H.R. 2599) introduced by Representatives Nan Hayworth (R-CA), Dan Lungren (R- NY) and Mike Thompson (D-CA) would rescind the warnings from the federal financial institutions that shut down PACE. The bill also would incorporate underwriting standards for PACE programs and establish rights of payment in foreclosure, consumer protections and limitations on delinquent payment collection. The bill has twenty co-sponsors. You can down load the legislation at this link
The Alliance to Save Energy has prepared a summary of PACE that is posted here