Item 4.2 - Approval of Property Assessed Clean Energy (PACE) Programs - Expanding Program ParticipationOF POW�y
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City of Poway
COUNCIL AGENDA REPORT
DATE:
TO:
FROM:
INITIATED BY:
SUBJECT:
Summary:
September 2, 2014
APPROVED N
APPROVED AS AMENDED ❑
(SEE MINUTES)
DENIED ❑
REMOVED ❑
CONTINUED
Resolution No. i q - 0 Sz-
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Honorable Mayor and Members of the City Uouncii
Daniel Singer, City Manager 50,d.
Leah Browder, Director of Public Works%
Eric Heidemann, Public Works Administrator
Property Assessed Clean Energy (PACE) Programs —
Expanding Program Participation
Several Property Assessed Clean Energy (PACE) programs have requested that the
City take the necessary steps to allow the programs to operate within the city
boundaries. These programs offer property owners a financing option for qualifying
renewable energy, energy and water efficiency and electric vehicle charging
infrastructure projects through the PACE program adopted by the California Legislature.
Authorization to implement the program requires adoption of several Resolutions and
agreements, but should have minimal ongoing impact on staff resources and no fiscal
impact on the City of Poway.
However, it is important that consumers are aware these are not City programs. Rather,
City staff, in response to interested property owners and in light of several other cities
allowing these programs, now recommends the City allow use of its taxing authority, as
permitted by law, for property owners to access these financing programs.
As with any undertaking of this type, consumers are responsible for performing their
own due diligence, carefully comparing available options and completing their own
analysis to understand what they are undertaking and determine how best to proceed
for their individual circumstances.
Recommended Action:
It is recommended that the City Council:
1. Adopt the Resolution to participate in the California Home Energy Renovation
Opportunity (HERO) PACE program, join the Western Riverside Council of
Governments as an Associate Member, and authorize the City Manager to
execute all necessary program documents and agreements;
2. Adopt the Resolution to participate in the Figtree Program and authorize the City
Manager to execute all necessary program documents and agreements; and
3. Adopt the Resolution approving Associate Membership in the California
Enterprise Development Authority (CEDA);
4. Authorize the Mayor to execute the Agreement and any other documents
required to join CEDA as an Associate Member; and
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5. Authorize the City Manager to execute the Indemnification Agreement between
Renewable Funding LLC in regard to the CaliforniaFIRST program.
Background:
Before 2008, interested consumers could finance energy efficiency projects through a
variety of familiar methods:
• Cash
• Home Equity Line of Credit (Loan)
• Solar Lease
• Power Purchase Agreement
• Personal loan with third party (e.g. installation firms)
With the goal of stimulating increased energy efficiency and use of alternative energy
sources by home, business and industrial property owners, several states enacted laws
to permit establishment of Property Assessed Clean Energy (PACE) programs,
providing an additional financing option.
PACE programs provide a mechanism for property owners to finance energy efficiency,
water efficiency, and other renewable energy projects on existing residential and
commercial structures, utilizing their property as collateral, through a special tax
assessment on the property. The contractual assessments are recorded as a lien (in
most cases a priority lien) against the subject property, entered in the County roll and
collected through the property owner's tax bill at the same time and in the same manner
as traditional property assessments. The property tax assessment provides financing for
these types of improvements without requiring a down payment or payment of the full or
partial upfront capital cost of the improvement.
In 2008, AB 811 was enacted in California and established parameters for PACE
programs to finance alternative energy sources or greater energy efficiencies for
property owners. Later, AB 474 was enacted to expand the scope of AB 811 programs
to include water efficiency improvements.
In 2012, SB 555 amended the Community Facilities District Law to allow the formation
of community facilities districts to finance energy efficiency, water conservation and
renewable energy improvements on private property.
On January 5, 2010, the City Council approved the City of Poway's participation in
CaliforniaFIRST, a statewide AB 811 PACE program offered through California
Statewide Communities Development Authority (CSCDA). In doing so, the City joined a
large number of other cities and counties throughout California in approving this
program sponsored by California Communities, a Joint Powers Authority established by
the League of California Cities and the California Association of Counties.
Federal Housing Finance Agency (FHFA) Concerns and Impacts
FHFA is an independent federal agency which supervises and regulates Fannie Mae,
Freddie Mac and the 12 Federal Home Loan Banks. Together these enterprises own or
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guarantee more than $5 trillion in residential mortgages. In July 2010, the FHFA issued
a statement raising concerns regarding PACE programs. FHFA's primary concerns
were related to the first -lien position offered through the PACE programs and the
potential effects that position could have on mortgages, either owned or guaranteed by
Fannie Mae and Freddie Mac.
In a follow -up to its July statement, the FHFA issued a February 2011 directive that
prohibited Fannie Mae and Freddie Mac from purchasing mortgage loans secured by
properties with outstanding first -lien PACE obligations and required them to undertake
other steps necessary to "protect their safe and sound operations from these first -lien
PACE programs."
As a result of the FHFA's reaction to PACE programs with priority -lien components,
most PACE programs stalled and, after some time, only moved forward with commercial
projects that were not impacted by the FHFA issues. The program initially joined by the
City of Poway (CaliforniaFIRST) fell into this category and was not processing
residential PACE projects as a result.
The actions taken by the FHFA resulted in lawsuits filed by several plaintiffs, including
the State of California, in four federal courts. In March 2013, the U.S. Court of Appeals
for the Ninth Circuit found that the FHFA's actions could not be challenged in court.
Findings:
HERO, Figtree and Ygrene have approached City staff requesting that the City take
actions necessary to allow establishment of their programs within the city
boundaries. Because Ygrene uses the SB 555 legislation and requires the City to
form and administer a Community Facilities District involving significant staff time
and expense, that program option is not recommended at this time.
Approval of tonight's recommended actions would allow property owners within
Poway's city limits the option to finance renewable energy, energy and water efficiency
and electric vehicle charging infrastructure projects through the PACE program adopted
by the California Legislature. Property owners who wish to participate will finance the
installed improvements through either WRCOG, CEDA or Renewable Funding, LLC
depending on which PACE program the property owner selects. Program summaries
are included as Attachments A, B and C.
Financing is secured by a voluntary contractual assessment levied on the owner's
property, with no recourse to the City. Participation in the program is 100% voluntary
and property owners who wish to participate in the program agree to repay the amount
borrowed through a voluntary contractual assessment collected together with their
annual property taxes. This financing is available for eligible improvement on both
residential (generally accommodated by the HERO program at this time and the
CaliforniaFIRST program as of September 2014) and commercial properties (generally
accommodated at this time by both the Figtree and CaliforniaFIRST programs).
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To help mitigate concerns from the FHFA, Governor Jerry Brown included a proposal in
the FY 2013 -2014 state budget authorizing the California Alternative Energy and
Advanced Transportation Financing Authority to establish a PACE Loss Reserve
Program through Senate Bill 96. This program was specifically designed to address
FHFA concerns through the use of a reserve fund that would reimburse residential
PACE programs for costs associated with keeping mortgage interests whole in the
event of a foreclosure or forced sale. The Loss Reserve Program will compensate
mortgage lenders for losses resulting from the existence of a PACE lien in a foreclosure
or forced sale. Claims will be paid from the reserve to the PACE program and may be
used as a reimbursement to that program. PACE programs will pay a small
administrative fee based on loan volume to help sustain this program. Governor Brown
has allocated $10 million for the implementation of this program in the 2013 -2014 state
budget. The PACE Loss Reserve Program was officially launched in March and is
currently active.
Tonight's recommended actions take the necessary steps to expand the City's existing
PACE program participation contingent on PACE Programs being enrolled in the PACE
Loss Reserve Program. Additionally, to be an authorized PACE program in Poway, the
lender is required to provide full and understandable disclosures to program applicants.
These disclosures include the possibility that participation may trigger acceleration of an
existing mortgage and that the participant may be required to prepay the contractual
assessments and all associated fees and penalties upon the refinancing or sale of the
property.
Conclusion:
Staff has been involved in tracking the development of PACE programs since 2008.
Currently, Poway property owners can access PACE financing opportunities through the
CaliforniaFIRST Program. Until recently, CaliforniaFIRST has not provided a residential
component, due to the position of the FHFA. Instead, this PACE program focused on
commercial and industrial projects. CaliforniaFIRST anticipates relaunching its
residential program component in September 2014 and that aspect of the program
would be available to Poway property owners immediately.
Tonight's action would make another commercial option, Figtree, immediately available
to property owners. Figtree also anticipates launching a residential program before the
end of this calendar year.
Additionally, tonight's action would make available to Poway property owners the
residential option of HERO, after its judicial validation that HERO anticipates will be
completed before the end of the calendar year.
It should be noted that the PACE program implementation process for each of these
companies includes a judicial validation component. Judicial validation affirms the
soundness of a particular PACE program. Under this process, a lawsuit is filed in
superior court asking the court to evaluate and rule on the constitutionality and legality
of the program and its district. A successful judicial validation provides both a higher
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level of protection from legal challenges and certainty to government entities, program
administrators, and potential or actual capital investors.
Both CaliforniaFIRST and Figtree completed successful judicial validation processes as
part of initial overall program formation meaning that these programs will be
immediately available to Poway property owners upon Council action. HERO
undertakes judicial validation quarterly including all new members for that quarter.
Should Council accept tonight's recommendations, the City of Poway would be included
in HERO's next quarterly validation.
The FHFA has maintained a passive opposition to the concept of PACE programs that
include a priority -lien component. However, in light of the establishment of the California
Loss Reserve Program, the widespread growth of the HERO residential PACE program
throughout the state, and the additional requirements the City has imposed on PACE
companies, staff is recommending the City expand the PACE options available to
Poway property owners.
The City Attorney has reviewed the required agreements and resolutions as well as the
process required to participate in these programs.
Fiscal Impact:
Because this is not a City program, there will be no ongoing direct fiscal impact to the
City. Costs to date have been indirect associated with tracking this issue, coordinating
with program providers, and preparing materials for consideration by the City Council.
Environmental Review:
This item is not subject to CEQA review.
Public Notification:
A copy of this report has been sent to Renovate America, Inc. for California HERO,
Figtree Financing, and Renewable Funding for CaliforniaFIRST.
Attachments:
A. Program Summary: California Home Energy Renovation Opportunity (HERO)
Program (Page 7)
B. Program Summary: California Enterprise Development Authority (CEDA)-
Figtree PACE (Page 14)
C. Program Summary: CSCDA— CaliforniaFIRST (Page 21)
D. HERO: Resolution consenting to the inclusion of properties within the City's
jurisdiction in the California HERO Program and approving the amendment to the
WRCOG Joint Powers Agreement. Also included in this Attachment is "Exhibit
A ", an Amendment to the WRCOG Joint Powers Agreement adding the City of
Poway as an Associate Member (Page 26)
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E. HERO: Joint Powers Agreement of the Western Riverside Council of
Governments (Page 36)
F. FIGTREE: Resolution consenting to the inclusion of properties within the City's
jurisdiction in the Figtree PACE Program (Page 58)
G. FIGTREE: Program Report (copy available in the City Clerk's office)
H. FIGTREE: Resolution approving Associate Membership in CEDA (Page 67)
I. FIGTREE: CEDA Associate Membership Agreement (Page 70)
J. CALIFORNIAFIRST: Indemnification Agreement between Renewable Funding,
LLC and the City of Poway (Page 73)
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Attachment A
California Home Energy Renovation Opportunity (HERO) Program
Source:
This information was originally reproduced from a March 2013 Center for Sustainable
Energy California report: "Residential and Commercial Property Assessed Clean Energy
(PACE) Financing in California" and was updated by HERO representatives in August
2014.
Acknowledgement:
This information is not intended to be all inclusive. As with any undertaking of this type,
consumers are responsible for performing their own due diligence and analysis when
determining how best to proceed for their individual circumstances.
Overview:
California HERO Program is a statewide Residential and Commercial PACE Program
which encourages an open- market approach. This means that Cities and Counties may
make multiple programs available to their constituents, including California HERO.
The California HERO Program was developed by the Western Riverside Council of
Governments ( WRCOG) and their partners which enable Cities and Counties to make
HERO available to their constituents. WRCOG is a joint powers authority that enables
any City and County in California to become associate members. The California HERO
Program contracts with Renovate America and Samas Capital to provide financing for
the residential and commercial markets respectively. California HERO only funds
projects on residential and commercial properties in jurisdictions that have joined its
Program.
Funding:
The HERO Program is authorized to issue up to $2 billion in bonds to finance eligible
improvements. Renovate America and Samas Capital have committed $300 million to
fund this Program.
Status:
As of July 23, 2014, the HERO website indicates that they are active in 167 California
cities. San Diego county approvals include Carlsbad, Coronado, El Cajon, Encinitas,
Escondido, Imperial Beach, La Mesa, Lemon Grove, Oceanside, San Diego, San
Marcos, Solana Beach, Unincorporated County, and Vista.
Attachment A
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As of July 2014, the company indicates that it has funded over 14,000 projects valued at
over $260 million; created 2,300+ jobs; contributed over $484 million to economic
stimulus; generated over $12 million in utility savings; and reduced emissions by 25,000
tons.
Underwriting Criteria for Program Participation:
Residential HERO
• Applicant property owner must be the property owner of record.
• Property owner must be current on their property taxes for the prior 12 months.
• Property owners must be current on all property debt at the time of funding and
cannot have had more than one 30 day mortgage late over the previous 12
months.
• Property must not have any material liens other than lender debt or liens
recorded by community facilities districts or similar financing districts.
• Property owner must not have any active bankruptcies in the past seven years
and the property must not be an asset in a bankruptcy proceeding, provided,
however, that if the bankruptcy is more than two years old, and if property owner
has no additional derogatory credit, the property owner may be approved.
• Mortgage - related debt on the property must not exceed 90% of the market value
of the property.
• Improvement costs are reasonable in relation to property value. Proposed
improvements must not exceed 15% of the market value of the property,
provided, however, that the combined mortgage - related debt and amount of
PACE assessment must not exceed 100 %.
• The total annual property tax and assessments, including the contractual
assessment, on the property will not exceed 5% of the property's market value,
as determined at the time of approval of the contractual assessment.
Commercial HERO
• Applicant property owner must be the property owner of record.
• Mortgage debt lender have given consent to program financing.
• Property owner must be current on property taxes and the property owner
certifies that such owner has not had a late payment on their property tax more
than once during the prior three years or since the purchase of the property, if
owned by such property owner less than three years.
• Property owner must be current on all property debt for a period of six months
prior to the application, including no payment defaults or technical default or
since purchase if the property has been owned less than six months by the
current owner, through funding.
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• Property owner or their affiliated companies have not been involved in a
bankruptcy proceeding during the past seven years and the property proposed to
be subject to the contractual assessment must not currently be an asset in a
bankruptcy proceeding.
• All individual property owners must sign the application, assessment contract and
all required notices. For properties owned by corporations, LLCs or LLPs,
signatures by authorized representatives and /or corporate resolutions are
required.
• Property must not have any liens other than lender debt or liens recorded by
community facility districts or similar financing districts.
• Eligible product costs are reasonable in relation to property value. Proposed
eligible products must not exceed 10% of the market value of the property.
• Property has a debt service coverage ratio of 105% or higher.
• Mortgage - related debt on the property plus the principal amount of the
contractual assessment does not exceed 90% of the market value of the
property.
• The total annual property tax and assessments, including the contractual
assessment, on the property will not exceed 5% of the property's market value,
as determined at the time of approval of the contractual assessment.
Restrictions on Contractors:
The HERO Program requires that contractors apply through an online application. In
order to qualify, the contractor must have the proper license and bonding requirements
with the California State Contractors License Board. The Contractor must maintain a
good standing with the California State Contractors License Board in order to participate
in HERO approved projects.
The costs of installation are eligible to be financed only if completed by a contractor that
is registered with the Program or by the property owner who is self - installing subject to
the limitation in the Program. A list of over 3,500 contractors registered with the
Program is located on Program's website; however, the Program will not make
recommendations for contracting assistance. Eligible costs do not include labor costs
for property owners doing the work themselves.
Eligible Financeable Costs:
Eligible costs include equipment and installation (includes but not limited to labor,
energy /water audits, design, drafting, engineering, permit fees, and inspection charges).
Additionally, the Program Administrator determines whether the estimated equipment
and installation costs are reasonable. The Administrator may require additional bids to
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determine whether costs are reasonable. Financing may be limited to the amount
deemed reasonable by the Administrator.
Assessment Finance Amount:
• Minimum: $5,000.
• Maximum: the maximum assessment amount is 10% of the value of the property.
• Committee Approval Required:
• Residential projects over $200,000
• Commercial projects over $600,000
Financing Term:
Not to exceed useful life of the improvement, up to 20 years.
• Residential: Assessment contracts are subject to 5 -, 10 -, 15 -, or 20 -year repayment
periods.
• Commercial: Assessment contracts are subject to 5 -, 10 -, 15 -, or 20 -year repayment
periods.
A 25 -year financing term is also being developed to parallel 25 -year warrantees on solar
panels.
Interest Rate:
Program interest rates are set to create a competitively priced self- sustaining program
with the ability to remarket the securities to ensure liquidity. The interest rate is broken
down by program.
Residential HERO: Program Administrator sets fixed interest rates either when the
application is approved (may trigger additional fees) or when the assessment contract is
signed. The interest rate fluctuates with market conditions and an estimate is available
on the HERO website. Interest paid on the principal balance is tax deductible. Interest
rates are currently set between 5.95 and 8.95% depending on the term of the loan.
Commercial HERO: Program Administrator sets the interest rate at time of funding.
Samas Capital will provide ongoing pricing feedback from the capital markets to aid in
adjusting product pricing.
Standard Financing: Interest rate is set at the time of the first bond sale, or if interim
financing is available, then the interest rate is set by the cost of the interim financing and
the bond sale rates. The interest rate will never increase. The Program Administrator
may decrease the interest rate if long -term financing can be negotiated at a lower
interest rate that still allows funding of the Program.
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Reserve Fund:
There is a Reserve Fund of 0.27% of the total assessment agreed to by the property
owner. In addition, the Residential HERO Program participates in the Governor of
California's PACE Loss Reserve Program. The $10 million PACE Loss Reserve
Program, authorized by Senate Bill 96 (2013), is designed to address FHFA financial
concerns by making first mortgage lenders whole for any losses in a foreclosure or a
forced sale that are attributable to a PACE loan. If a mortgage lender forecloses on a
home that has a PACE lien, the Reserve can be used to cover PACE payments during
the foreclosure period. Alternatively, if a local government sells a home for unpaid taxes
and the sale price falls short of the outstanding tax and first mortgage amounts, the
Reserve can be used to cover the shortfall (up to the amount of outstanding PACE
payments). By covering these types of losses, the Program puts the first mortgage
lender in the same position it would be in without a PACE lien.
Fees Assessed on Property Owner:
HERO Residential and Commercial
• Program Cost: Determined by City, County or District where property is
located.
• Application Fee: None.
• Annual administration and collection costs: Determined by City, County or
Cistrict where property is located.
FHFA and /or Lender Issues:
Typically, the California HERO Program provides the following disclosure but does not
require lender consent for residential projects. However, some Cities and Counties have
added additional disclosure requirements that HERO must incorporate to operate.
Property owners may be required to pay off the special assessment at sale or refinance.
The disclosure is as follows:
Before completing a program application, you should carefully review any mortgage
agreement(s) or other security instrument(s) which affect the property or to which you
as the property owner are a party. Entering into a program assessment contract without
the consent of your existing lender(s) could constitute an event of default under such
agreements or security instruments. Defaulting under an existing mortgage agreement
or security instrument could have serious consequences to you, which could include the
acceleration of the repayment obligations due under such agreement or security
instrument. In addition, on August 31, 2010, Fannie Mae and Freddie Mac stated that
they would not purchase home loans with assessments such as those offered by
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WRCOG. This may mean that property owners who sell or refinance their property may
be required to prepay such assessments at the time they close their sale or refinancing.
It is unknown what type of risk this approach creates for residential property owners in
light of the uncertainty created over residential PACE by the Ninth Circuit's March 19,
2013, dismissal of litigation against the FHFA.
Treatment of Federal /State Rebate, Tax Credit, and Incentives:
All available public utility, federal and state rebates will be deducted from the
assessment amount at the time of financing. State or federal tax credits and
performance -based incentives —such as the California Solar initiative Performance
Based Incentive —will not be deducted from the assessment amount, but property
owners may wish to consider these additional benefits in determining the amount of
their financing request.
Costs and Liability to City:
There are no costs to the City or County to participate in the California HERO Program.
The Program appears to have limited costs to a City or County beyond staff time to
review the program, produce staff reports, pass resolutions, and reach agreement on
indemnification and release of liability.
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HERO Residential Process Overview
The chart below shows the steps for the completion of a residential project financed
through the Program:
Apply
Property owner submits application online, through a contractor, or by hard
copy,
Product Approval
Contractor or property owner calls WRCOG HERO Program Representative
with specific prtrduct details before installing products,
Sign Financing Documents
Property owner is emailed Financing Documents, which they sign, notarize,
and return.
Install Eligible Products
After Financing Documents are approved and the contractor and property
owner receive a Notice to Praceed, the contractor may start work,
Submit Completion Certificate
Once all wort: and permits have been completed, the contractor and property
owner must sign and submit a Completion Certificate within 90 days,
Assessment and Payment Issued
After WRCOG HERO Program receives the signed Completion Certificate, the
assessment lien documents are recorded and payment is issued.
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Attachment B
California Enterprise Development Authority (CEDA)— Figtree PACE
Source:
This information was originally reproduced from a March 2013 Center for Sustainable
Energy California report: "Residential and Commercial Property Assessed Clean Energy
(PACE) Financing in California" and was updated by Figtree representatives in August
2014.
Acknowledgement:
This information is not intended to be all inclusive. As with any undertaking of this type,
consumers are responsible for performing their own due diligence and analysis when
determining how best to proceed for their individual circumstances.
Overview:
The California Enterprise Development Authority (CEDA) is a joint powers authority
established by the California Association for Local Economic Development (CALED).
CEDA is the agency that forms assessment districts for the Figtree PACE financing
programs under the Improvement Act of 1911.
CEDA acts as the issuer of the municipal bonds that finance Figtree PACE projects.
CEDA uses the Improvement Bond Act of 1915 (California Streets & Highways Code
8500 et seq) to issue limited obligation bonds, notes or other forms of indebtedness
secured by the contractual assessments revenue to finance improvements in the district
created under AB 811. These bonds are structured as either a micro bond for a specific
project or as a pooled bond for multiple projects before being sold to investors on the
open market. CEDA also may create a special reserve fund for the bonds under part 16
of the Improvement Bond Act of 1915 if required by investors. CEDA has authorized up
to $500 million for the Figtree PACE Program at this time.
CEDA retained Figtree Financing, a San Diego -based company, to manage and
administer its PACE program. Figtree provides comprehensive services to applicants
and to jurisdictions as a program administrator similar to other private PACE
administrators. Figtree successfully completed the first and only multi -city pooled PACE
bond to date. Figtree's financing model is designed to accommodate financing
structures including owner - arranged financing, specific project financing, pooled
financing, and financing through a credit facility. It remains to be determined which of
these options has been the most successful in terms of project financed.
Attachment B
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Figtree has successfully obtained lender consent from multiple national and regional
lenders including Wells Fargo, US Bank, Bank of the West, West America Bank, and
SBA Financing. Figtree has successfully completed a statewide judicial validation of its
program under the CEDA JPA.
Eligible Property:
Figtree currently only offers its Program to qualified commercial property owners in 68
California Cities and Counties. Commercial properties include: office, retail,
hotel /restaurant, multi - family properties of five units or more, data centers,
warehouse /industrial, agriculture, healthcare, education and non - profit. Figtree's
Residential PACE Program will launch before the end of the year and will feature many
of the same elements found in its Commercial PACE Program. The Program will utilize
the same legal structure and will be administered by the same professional financing
team. In fact, Figtree's Residential PACE Program is already authorized in more than
66 California Cities and Counties.
Funding:
Figtree has secured a $60 million financing facility to fund Commercial PACE Projects.
CEDA issues bonds to fund projects. The facility is backed by a capital partner in the
form of a premier New York based financial institution with over $20 billion of capital
under management. Thus far, CEDA and Figtree have financed projects in four distinct
funding cycles; each resulting in a portfolio of projects aggregated within capital market
structures and sold to investors. Figtree will provide financing for residential PACE
projects using the same type of financing facility.
Underwriting Criteria for Program Participation:
Commercial Program
• Applicant is legal owner of the property described in the application.
• Property owner is current on property taxes for the property and has not been
delinquent in the past three years or since owning the property if less than three
years.
• Property owner is current on private property debt and has not been delinquent in
the past three years or since owning the property if less than three years.
• Mortgage lender has been provided the Notice of Request for Lender Consent
and Acknowledgement.
• Property owner has not declared bankruptcy in the past five years.
• Property is not listed as an asset in bankruptcy.
• Lien -to -value ratio (excluding assessed financing amount) does not exceed
100% (i.e. no negative equity). The outstanding mortgage must not be an amount
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greater than the property's assessed total value. In certain cases, an appraised
value can be used if the assessed total value is deemed inaccurate.
• Property is developed and located within the jurisdiction of a participating
agency.
• Property is classified as Commercial (including Industrial, Agricultural, multi-
family, etc.)
Residential Program
• Applicant is legal owner of the property described in the application.
• Property is not a leasehold (i.e. the property owner owns the property in fee
simple).
• Amount of financing requested under the Program shall not exceed 10% of the
value of the property.
• All existing private debt recorded against the property does not exceed 84% of
the value of the property.
• There are no involuntary liens, defaults or judgments on the property in excess of
$1,000.
• Property owner is current on property taxes for the property and has not been
delinquent in the past three years or since owning the property if less than three
years.
• Property owner is current on private property debt and has not been delinquent in
the past three years or since owning the property if less than three years.
• Property title is not subject to power of attorney, easements, or subordination
agreements restricting the property owner from subjecting the property to a
PACE lien.
• Property owner has not declared bankruptcy in the past seven years.
• Property is not listed as an asset in bankruptcy.
• Property is classified as single - family residential or multi - family residential (up to
4 units).
Restrictions on Contractors:
Property owners work with any contractor they choose. However, the Figtree PACE
Program requires that contractors apply to participate in the Program through an online
application. Once approved, the contractor is added to an online directory of contractors
eligible to contract for projects through Figtree PACE. Figtree PACE requires that
contractors:
• Hold a business license in the jurisdiction where work is being performed.
• Have a minimum of 5 years work experience as a licensed contractor in the State
of California, or demonstrate sufficient experience in a relevant field of work.
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• Hold a minimum of $1,000,000 in general liability insurance.
• Bonding and Worker's Compensation must be in accordance with California
State Contractors License Board requirements.
• Participate in a mandatory PACE financing training session provided by Figtree.
Figtree PACE requires the signing of a contractor agreement that makes contractors
responsible for installing equipment on the property once CEDA approves the project.
Contractors are reimbursed upon satisfactory completion of a project within 14 business
days generally.
Audit Requirement:
An energy audit is not required.
Eligible Financeable Costs:
Eligible costs include equipment and installation (labor, drafting, engineering,
application fees, permit fees, processing fees, and inspection charges). Additionally,
CEDA determines whether the estimated equipment and installation costs are
reasonable. CEDA may require additional bids to determine whether costs are
reasonable. Financing may be limited to the amount deemed reasonable by CEDA.
Assessment Finance Amount:
• Minimum Residential: $1,000.
• Minimum Commercial: $5,000.
• Maximum: For residential and most commercial properties 10% of the value of
property. Some commercial properties may be able to finance projects up to
20% of the property value.
Financing Duration:
Not to exceed useful life of the improvement, up to 20 years.
Interest Rate:
Annual interest rate is determined by market condition at time of issuing bonds but may
not exceed 12% as required by California Law. Commercial rates are currently 4.63%
to 6.65% and maximum financing is up to 10% of total property value. Alternative rates
are available for projects in excess of 10% of property value and projects in excess of a
million dollars.
Residential rates are currently projected to be between 5.50% to 7.50% with financing
up to 10% of total property value.
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17 of 75 September 2, 2014 Item # 4.2
Reserve Fund:
When Figtree launches its Residential PACE Program it will enroll in the California State
Treasurer's PACE Loss Reserve Program, authorized by Senate Bill 96 (2013).
Fees Assessed on Property Owner:
• Processing Fee (Commercial Properties): A fee of $695 will be added to the total
amount of the assessment at the time of closing. An additional $100 charge will
apply to each of any additional parcels in connection with the assessment. This
fee pays for costs incurred to process the application, including a title report, and
documentation fees for recording liens. This fee is included in the total amount
of financing.
• Financing Issuance Fee: At the time of closing, Figtree will charge the property
owner a one -time administration fee of up to 4% (Commercial) or 6%
(Residential) of the principal amount of the assessment on the property to cover
the transaction costs of the program. This fee will be added to the total
assessment amount financed.
• Annual Administrative Fee: A charge of up to 3% of the total annual assessment
amount will apply for cost recovery. This administrative cost recovery will be
added to the annual assessment amount. Such administrative charges include
fees for levying assessments through the county assessor and other costs
associated with providing PACE financing.
• Pre - Payment Fee: If the assessment is paid off early the property owner will
incur a fee based on the following schedule:
o 105% if paid off in years 1 -5
o 103% if paid off in years 6 -10
o None if paid off in years 11 -20
Fees may be changed from time to time by approval of CEDA of an updated
Program Report.
FHFA Issue and /or Lender Issue - Lender Consent:
Commercial PACE
Figtree PACE requires notice and request of written consent from holders of any private
lien on the participating commercial property. The lien holder must agree that the
assessment lien will have the same priority as real property taxes. The Program
Administrator, Figtree, will send "Notice and Request for Lender Consent" via certified
mail. This request provides:
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18 of 75 September 2, 2014 Item # 4.2
• Confirmation from the Mortgage Lender that the levy of the assessment pursuant
to the Assessment Contract will not trigger an event of default or the exercise of
remedies under the participating property owner's Mortgage Documents.
• Notice that the assessment will be secured by a statutory lien on the participating
property pari passu with real property taxes.
• Written notice of the proposed participation of the property in the Program.
• Confirms that the Mortgage Lenders' signature constitutes consent as required
under the Mortgage Documents.
The property owner may not participate if the lender returns the Notice and Request for
Lender Consent and specifically states it does not consent.
Residential Program
Figtree requires notification of the PACE assessment to the mortgage lender. The
responsibility for the Mortgage Lender's written consent lies with the residential
borrower. Borrowers are required to acknowledge certain disclosures in the Application
and the Assessment Contract and are required to declare the following:
Borrower declares that (i) Borrower has received, read and understands the risks and
characteristics of the Program described in the Property Owner Acknowledgments and
Disclosures and FHFA Disclosure set forth in the Application and (ii) Borrower has been
informed that executing this Contract, receiving financing for Authorized Improvements
and consenting to the assessment levied against the Property without lender consent
may constitute an event of default under Borrower's residential mortgage, and (iii)
Borrower takes the sole responsibility for consequences of such default which may
include acceleration of repayment obligations due under Borrower's residential
mortgage.
It is not clear what type of risk this approach creates for residential property owners in
light of the uncertainty created over residential PACE by the Ninth Circuit's March 19,
2013 dismissal of litigation against the FHFA.
Costs and Liability to City:
A City or County will bear no costs, to join Figtree PACE beyond staff time and a legal
analysis to review the program. A City or County will not bear costs to setup the
program, the assessment district, or implement the program. Cities and Counties are
not liable for bonds as bonds are the obligation of CEDA. Additionally, Figtree
indemnifies the City or County.
Figtree's standard indemnification language requires it to defend and indemnify
participating municipalities against legal liability and other damages. Additionally,
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19 of 75 September 2, 2014 Item # 4.2
municipalities do not bear the costs or burden of any assessment proceedings; the levy
or collection of assessments or any required remedial action in the case of
delinquencies in such assessment payments or the offer, issuance, sale, or
administration of the bonds or any other bonds issued in connection with Figtree PACE.
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20 of 75 September 2, 2014 Item # 4.2
Attachment C
CSCDA-- CaliforniaFIRST
Source:
This information was originally reproduced from a March 2013 Center for Sustainable
Energy California report: "Residential and Commercial Property Assessed Clean Energy
(PACE) Financing in California" and was been updated by Renewable Funding
representatives in August 2014.
Acknowledgement:
This information is not intended to be all inclusive. As with any undertaking of this type,
consumers are responsible for performing their own due diligence and analysis when
determining how best to proceed for their individual circumstances.
Overview:
CaliforniaFIRST is a statewide Property Assessed Clean Energy (PACE) financing
program sponsored by the California Statewide Communities Development Authority
(CSCDA), a joint powers authority co- sponsored by the California State Association of
Counties and the League of California Cities. The Program provides financing for
renewable energy, energy efficiency and water efficiency measures for both commercial
and residential property. CSCDA selected Renewable Funding to administer
CaliforniaFIRST.
CaliforniaFIRST is active in 17 California counties and 140+ cities. Participating
jurisdictions in San Diego County include Carlsbad, Chula Vista, Coronado, Del Mar, El
Cajon, Encinitas, Escondido, La Mesa, Lemon Grove, Oceanside, Poway, San Diego,
Santee, Solana Beach, and the Unincorporated County.
The City of Poway originally passed a resolution to join CaliforniaFIRST in 2010.
CSCDA put the Residential Program on hold due to FHFA concerns but due to the
establishment of CAEATFA's loss reserve fund for lenders in spring 2014, the
Residential Program is now available. CaliforniaFIRST had its soft launch in San Diego
County on July 28, 2014 with a full launch scheduled for September 2, 2014. The
Commercial Program has been active since 2012 and currently has 108 applications
statewide for a project total of over $75,000,000.
CaliforniaFIRST Residential:
Eligible Properties
Single- family residential and multi - family up to 3 units
Attachment C
21 of 75 September 2, 2014 Item # 4.2
Underwriting Criteria:
1. Applicant(s) must be the property owner(s) of record.
2. Property owner(s) must be current on their property taxes for the prior 12
months.
3. Property owner(s) must certify that the property taxes have not been paid late
more than once during the prior three years (or since the purchase if owned by
them for less than three years).
4. Property owners must be current on all property debt of the subject property at
the time of application and cannot have had more than one 30 -day mortgage late
payment over the prior 12 months.
5. There must be no notices of default or foreclosure filed against the subject
property by current property owner within the last two years.
6. Property owner(s) have not been involved in a bankruptcy proceeding during the
past two years. If the property owner(s) has a bankruptcy older than two years,
and no late payments over 60 days past due in the last 24 months, then the
property owner may be approved. Additionally, the property may not currently be
an asset in a bankruptcy proceeding
7. All property owners must sign all required documentation.
Eligible Products:
CaliforniaFIRST finances renewable energy, energy efficiency and water efficiency
measures that are permanently affixed to the property
Assessment Amount:
1. Minimum amount of $5,000
2. Maximum amount up to $200,000 or 10% of property value
Financing Term:
Not to exceed useful life of the improvement, up to 20 years.
Funding:
Renewable Funding has a dedicated $300,000,000 to finance projects. Portfolios of
PACE financings will be sold to the private capital markets with sales proceeds
returning to Renewable Funding to continue additional financings.
Contractor Requirements:
Any contractor who is licensed by the State of California and is in good standing with
the Contractors State License Board ( "CSLB "), including meeting all applicable bonding
and insurance requirements, and who meets any fraud check requirements, is eligible to
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22 of 75 September 2, 2014 Item # 4.2
be a Participating Contractor with the Program. All Participating Contractors must also
sign a Program Participation Agreement.
FHFA and Lender Notice:
All participating homeowners are provided written information on their risks associated
with FHFA's stance on PACE financing. Homeowners are also encouraged to inform
their mortgage lender about the PACE lien.
CaliforniaFIRST Commercial:
The Commercial Program uses an open- market approach to finance projects. Under the
open- market approach the commercial property owner may use a list of capital
providers from CaliforniaFIRST to compare terms or may use their own capital provider.
The financing transaction is run through CaliforniaFIRST in order to secure the PACE
lien and corresponding benefits.
Once an agreement is reached, CSCDA issues a revenue bond that is then purchased
by the capital provider and secured by the tax assessment lien on the property.
CaliforniaFIRST uses third -party capital providers that it has pre- approved as well as
capital providers with whom property owners have negotiated to fund their project. This
creates internal competition and allows for property owner choice. CaliforniaFIRST also
uses a method of pooling bonds for projects under $250,000 for sale to a single investor
while bonds over $250,000 are generally sold individually to investors.
Eligible Properties:
All non - residential properties, including multi - family buildings with 5 or more units,
industrial, retail, agricultural and office space properties.
Underwriting Criteria:
Underwriting criteria is determined on a case -by -case basis as lenders and property
owners negotiate the terms of the financing. General underwriting criteria for the
Program is listed below:
1. Applicant must be legal owner.
2. For the past three years, or since ownership if less than three years, property
owner must be current on payment of:
a. Mortgages
b. Property taxes
c. Assessments and Liens
3. Property owner cannot have any notices of default or foreclosure, whether
currently in effect or released, filed against property within the last five years (or
3
23 of 75 September 2, 2014 Item # 4.2
since ownership by current property owner if less than five years) due to non-
payment of property taxes or loan payments.
4. Certification that the property owner is solvent and has no pending bankruptcy
proceedings.
5. Current property owner cannot have record of bankruptcy in the past three years.
6. No involuntary liens, defaults or judgments applicable to the subject property.
7. The assessed value plus the value of the project is equal to or greater than the
amount of private debt plus the PACE financed amount, assessment liens and /or
special taxes.
8. Property taxes, special taxes and assessment, including the PACE assessment,
may not exceed 5% of the property's assessed value.
9. Lenders may make additional information requests and subject property owner to
additional requirements.
Energy Audit Requirement:
An American Society of Heating, Refrigerating and Air - Conditioning Engineers Level 2
Audit must be performed by a licensed engineer.
Eligible Financeable Costs:
Eligible costs include equipment and installation (labor, design, engineering, permit
fees, and audits).
Assessment Finance Amount:
1. Minimum amount of $50,000.
2. The maximum financing amount is 20% property market value.
Financing Term:
Not to exceed useful life of the improvement, up to 20 years.
Affirmative Acknowledgment From Mortgage Lender:
The property owner's mortgage lender (the first lien holder in trust) needs to provide
written affirmative acknowledgment for the property to participate in the Program. This
means that the first lien holder in trust must consent and agree to the recording of the
contractual PACE assessment as a superior lien to its lien on the property. This
includes an acknowledgment that the PACE lien will not trigger a default or exercise of
remedies under the mortgage on the respective property.
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24 of 75 September 2, 2014 Item # 4.2
Reserve Fund:
A reserve fund is not required by the Program, although CaliforniaFIRST may
accommodate one should it be required by the capital provider or the mortgage lender.
A property owner would then allocate a percentage of their total assessed financing
amount to establish the reserve fund for their share of the bonds. During the final years
of the outstanding bonds, the reserve allocation would be returned to the property
owner as a credit on their annual levy assuming no delinquencies or late payments.
Fees Assessed on Property Owner:
• Application Fee: There is no initial application fee
• County Tax Collector Fee: $.10 /parcel
• Closing Fees: The total amount of closing fees is determined by the size of the
project, and typically range between 3 -6 %. The types of closing fees charged
include:
• Program Administration
• Bond Counsel
• Project Validation
• Program Sponsor
• Issuer Counsel
• Fiscal Agent
Costs and Liability to City:
This Program appears to have limited cost to a City or County beyond staff and Council
time to research and write a report, pass a Resolution and associated documentation.
To date there have been no costs to Cities or Counties to participate in CaliforniaFIRST.
Cities have no liability because Cities do not establish the program, administer the
program, or issue the bonds under CaliforniaFIRST.
5
25 of 75 September 2, 2014 Item # 4.2
RESOLUTION NO. 14-
RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF POWAY, CALIFORNIA,
CONSENTING TO THE INCLUSION OF PROPERTIES
WITHIN THE CITY'S JURISDICTION IN THE
CALIFORNIA HERO PROGRAM TO FINANCE
DISTRIBUTED GENERATION RENEWABLE ENERGY SOURCES,
ENERGY AND WATER EFFICIENCY IMPROVEMENTS AND
ELECTRIC VEHICLE CHARGING INFRASTRUCTURE AND
APPROVING THE AMENDMENT TO A CERTAIN
JOINT POWERS AGREEMENT RELATED THERETO
WHEREAS, the Western Riverside Council of Governments ( "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 April 1, 1991, as amended from time to
time (the "Authority JPA "); and
WHEREAS, Authority intends to establish the California HERO Program to
provide for the financing of renewable energy distributed generation sources, energy
and water efficiency improvements and electric vehicle charging infrastructure (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, City of Poway (the "City ") is supportive of its citizens' interests in the
development of renewable energy sources and energy and water efficiency
improvements, reduction of greenhouse gases, protection of our environment, and
addressing climate change; 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 California
HERO Program would promote the purposes cited above; and
WHEREAS, the City wishes to provide financing tools as allowed by law to those
who own property in its jurisdiction wishing to improve energy and water efficiency, and
in doing so cooperate with Authority in order to efficiently and economically assist
property owners the City in financing such Improvements; and
Attachment D
26 of 75 September 2, 2014 Item # 4.2
Resolution No. 14-
Page 2
WHEREAS, Authority has authority to establish the California HERO Program,
which will be such a voluntary contractual assessment program, as permitted by the
Act, the Authority JPA, originally made and entered into April 1, 1991, as amended to
date, and the Amendment to Joint Powers Agreement Adding the City of Poway as an
Associate Member of the Western Riverside Council of Governments (the "Council ") to
Permit the Provision of Property Assessed Clean Energy (PACE) Program Services
within the City (the "JPA Amendment "), by and between Authority and the City, a copy
of which is attached as Exhibit "A" hereto, to assist property owners within the
incorporated area of the City in financing the cost of installing Improvements; and
WHEREAS, Senate Bill 96 (2013) amended Public Resources Code section
26060 in order to implement a PACE risk mitigation program for PACE loans to be
administered by the California Alternative Energy and Advanced Transportation
Financing Authority; and
WHEREAS, in light of this new development and growing public interest, the City
is interested in offering residential PACE options to eligible participants within the City
limits contingent on the California HERO PACE Program meeting certain programmatic
requirements; and
WHEREAS, the City is not at risk for any liabilities associated with any aspect of
PACE programs operating within its boundaries having only provided access to its
taxing authority as allowed by applicable law and the California HERO agrees to
indemnify and protect the City against any alleged liabilities; and
WHEREAS, the City may repeal this Resolution and terminate its Associate
Membership in the Council, upon written notice to the Council, should it be determined
at any time that it no longer desires to continue as an Associate Member of the Council;
and
WHEREAS, the City will not be responsible for the conduct of any assessment
proceedings; the levy and collection of assessments or any required remedial action in
the case of delinquencies in the payment of any assessments or the issuance, sale or
administration of any bonds issued in connection with the California HERO Program.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Poway
as follows:
Section 1: This City Council finds and declares that properties in the City's
incorporated area will be benefited by the availability of the California HERO Program to
finance the installation of Improvements.
Section 2: This City Council consents to inclusion in the California HERO
Program of all of the properties in the incorporated area within the City and to the
Improvements, upon the request by and voluntary agreement of owners of such
properties, in compliance with the laws, rules and regulations applicable to such
27 of 75 September 2, 2014 Item # 4.2
Resolution No. 14-
Page 3
program; and to the assumption of jurisdiction thereover by Authority for the purposes
thereof.
Section 3: The consent of this City Council constitutes assent to the
assumption of jurisdiction by Authority for all purposes of the California HERO Program
and authorizes Authority, upon satisfaction of the conditions imposed in this resolution,
to take each and every step required for or suitable for financing the Improvements,
including the levying, collecting and enforcement of the contractual assessments to
finance the Improvements and the issuance and enforcement of bonds to represent and
be secured by such contractual assessments.
Section 4: The City's participation in the California HERO PACE program is
subject to the condition that the California HERO PACE program has, or will (within 180
days following City's effective date as an Associate Member), meets the following
requirements:
a. The California HERO PACE Program is enrolled in the state PACE
Loss Reserve Program; and
b. The California HERO PACE Program will implement policies that
requires that it will provide full and understandable disclosures to
program applicants, including but not limited to the disclosure that
participation in the PACE program may trigger acceleration of existing
obligations of an existing mortgage and that the participant may be
required to prepay the contractual assessments and all associated
fees and penalties upon the refinancing or sale of the property.
Section 5: This City Council hereby approves the JPA Amendment
substantially in the form as presented at this meeting, and hereby authorizes the
execution thereof by the City Manager with such changes as the City Manager may
approve.
Section 6: City staff is authorized and directed to coordinate with Authority
staff to facilitate operation of the California HERO Program within the City, and report
back periodically to this City Council on the success of such program as requested.
Section 7: This Resolution shall take effect immediately upon its adoption. The
City Clerk is directed to send a certified copy of this resolution to the Secretary of the
Authority Executive Committee.
28 of 75 September 2, 2014 Item # 4.2
Resolution No. 14-
Page 4
PASSED, ADOPTED AND APPROVED by the City Council of the City of Poway
at a regular meeting this 2nd day of September, 2014.
Don Higginson, Mayor
ATTEST:
Sheila R. Cobian, CMC, City Clerk
STATE OF CALIFORNIA )
) SS
COUNTY OF SAN DIEGO)
I, Sheila R. Cobian, CMC, City Clerk, of the City of Poway, do hereby certify under
penalty of perjury that the foregoing Resolution No. 14 - * ** was duly adopted by the City
Council at a meeting of said City Council held on the 2nd day of September, 2014, and
that it was so adopted by the following vote:
AYES:
NOES:
ABSENT:
DISQUALIFIED:
Sheila R. Cobian, CMC, City Clerk
City of Poway
ATTACHMENT:
Exhibit A: Amendment to the Joint Powers Agreement Adding City of Poway as
an Associate Member of the Western Riverside Council of
Governments to Permit the Provision of Property Assessed Clean
Energy (PACE) Program Services with Such City
29 of 75 September 2, 2014 Item # 4.2
EXHIBIT A
AMENDMENT TO THE JOINT POWERS AGREEMENT
ADDING CITY OF POWAY
AS AN ASSOCIATE MEMBER OF THE
WESTERN RIVERSIDE COUNCIL OF GOVERNMENTS
TO PERMIT THE PROVISION OF PROPERTY ASSESSED
CLEAN ENERGY (PACE) PROGRAM SERVICES WITH
SUCH CITY
This Amendment to the Joint Powers Agreement ( "JPA Amendment ") is made
and entered into on the 2nd day of September, 2014, by City of Poway ( "City ") and the
Western Riverside Council of Governments ( "Authority ") (collectively the "Parties ").
RECITALS
WHEREAS, 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 "Joint Exercise of Powers Act ") and the Joint Power
Agreement entered into on April 1, 1991, as amended from time to time (the "Authority
JPA "); and
WHEREAS, as of October 1, 2012, Authority had 18 member entities (the
"Regular Members "); and
WHEREAS, Chapter 29 of the Improvement Act of 1911, being Division 7 of the
California Streets and Highways Code ( "Chapter 29 ") authorizes cities, counties, and
cities and counties to establish voluntary contractual assessment programs, commonly
referred to as a Property Assessed Clean Energy ( "PACE ") program, to fund certain
renewable energy sources, energy and water efficiency improvements, and electric
vehicle charging infrastructure (the "Improvements ") that are permanently fixed to
residential, commercial, industrial, agricultural or other real property; and
WHEREAS, Authority intends to establish a PACE program to be known as the
"California HERO Program" pursuant to Chapter 29 as now enacted or as such
legislation may be amended hereafter, which will authorize the implementation of a
PACE financing program for cities and county throughout the state; and
WHEREAS, City desires to allow owners of property within its jurisdiction to
voluntarily participate in the California HERO Program and to allow Authority to conduct
proceedings under Chapter 29 to finance Improvements to be installed on such
properties; and
WHEREAS, this JPA Amendment will permit City to become an Associate
Member of Authority and to participate in California HERO Program for the purpose of
facilitating the implementation of such program within the jurisdiction of City; and
A -1
30 of 75 September 2, 2014 Item # 4.2
WHEREAS, pursuant to the Joint Exercise of Powers Act, the Parties are
approving this JPA Agreement to allow for the provision of PACE services, including the
operation of a PACE financing program, within the incorporated territory of City; and
WHEREAS, the JPA Amendment sets forth the rights, obligations and duties of
City and Authority with respect to the implementation of the California HERO Program
within the incorporated territory of City; and
WHEREAS, the City may terminate this JPA Amendment in the manner required
by the Authority JPA or, if no such manner is prescribed in the Authority JPA, upon
written notice to CEDA, should it be determined at any time that it no longer desires to
continue as an Associate Member of the Authority.
MUTUAL UNDERSTANDINGS
NOW, THEREFORE, for and in consideration of the mutual covenants and
conditions hereinafter stated, the Parties hereto agree as follows:
A. JPA Amendment.
1. The Authority JPA. City agrees to the terms and conditions of the
Authority JPA, attached.
2. Associate Membership. By adoption of this JPA Amendment, City shall
become an Associate Member of Authority on the terms and conditions set forth herein
and the Authority JPA and consistent with the requirements of the Joint Exercise of
Powers Act. The rights and obligations of City as an Associate Member are limited
solely to those terms and conditions expressly set forth in this JPA Amendment for the
purposes of implementing the California HERO Program within the incorporated territory
of City. Except as expressly provided for by the this JPA Amendment, City shall not
have any rights otherwise granted to Authority's Regular Members by the Authority JPA,
including but not limited to the right to vote on matters before the Executive Committee
or the General Assembly, the right to amend or vote on amendments to the Authority
JPA, and the right to sit on committees or boards established under the Authority JPA or
by action of the Executive Committee or the General Assembly, including, without
limitation, the General Assembly and the Executive Committee. City shall not be
considered a member for purposes of Section 9.1 of the Authority JPA. City hereby
agrees that any subsequent amendments of the Authority JPA shall be binding upon the
City provided, however, that it shall not be bound by any amendments that create any
financial obligations on the part of the City and further provided, however, that before
any amendment becomes effective as to the City it shall have not less than sixty (60)
days after the effective date of the amendment to take such action to terminate its
Associate Membership and withdraw from the Authority, without cost or penalty.
3. Rights of Authority. This JPA Amendment shall not be interpreted as
limiting or restricting the rights of Authority under the Authority JPA. Nothing in this JPA
Amendment is intended to alter or modify Authority Transportation Uniform Mitigation
Fee (TUMF) Program, the PACE Program administered by Authority within the
A -2
31 of 75 September 2, 2014 Item # 4.2
jurisdictions of its Regular Members, or any other programs administered now or in the
future by Authority, all as currently structured or subsequently amended.
B. Implementation of California HERO Program within City Jurisdiction.
1. Boundaries of the California HERO Program within City Jurisdiction. City
shall determine and notify Authority of the boundaries of the incorporated territory within
City's jurisdiction within which contractual assessments may be entered into under the
California HERO Program (the "Program Boundaries "), which boundaries may include
the entire incorporated territory of City or a lesser portion thereof.
2. Determination of Eligible Improvements. Authority shall determine the
types of distributed generation renewable energy sources, energy efficiency or water
conservation improvements, electric vehicle charging infrastructure or such other
improvements as may be authorized pursuant to Chapter 29 (the "Eligible
Improvements ") that will be eligible to be financed under the California HERO Program.
3. Establishment of California HERO Program. Authority will undertake such
proceedings pursuant to Chapter 29 as shall be legally necessary to enable Authority to
make contractual financing of Eligible Improvements available to eligible property
owners within the Program Boundaries.
4. Financing the Installation of Eligible Improvements. Authority shall
develop and implement a plan for the financing of the purchase and installation of the
Eligible Improvements under the California HERO Program.
5. Ongoing Administration. Authority shall be responsible for the ongoing
administration of the California HERO Program, including but not limited to producing
education plans to raise public awareness of the California HERO Program, soliciting,
reviewing and approving applications from residential and commercial property owners
participating in the California HERO Program, establishing contracts for residential,
commercial and other property owners participating in such program, establishing and
collecting assessments due under the California HERO Program, adopting and
implementing any rules or regulations for the California HERO Program, and providing
reports as required by Chapter 29.
City will not be responsible for the conduct of any proceedings required to be taken
under Chapter 29; the levy or collection of assessments or 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 California HERO Program.
6. Phased Implementation. The Parties recognize and agree that
implementation of the California HERO Program as a whole can and may be phased as
additional other cities and counties execute similar agreements. City entering into this
JPA Amendment will obtain the benefits of and incur the obligations imposed by this
JPA Amendment in its jurisdictional area, irrespective of whether cities or counties enter
into similar agreements.
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32 of 75 September 2, 2014 Item # 4.2
C. Miscellaneous Provisions.
1. Withdrawal. City or Authority may withdraw from this JPA Amendment
upon six (6) months written notice to the other party; provided, however, there is no
outstanding indebtedness of Authority within City. The provisions of Section 6.2 of the
Authority JPA shall not apply to City under this JPA Amendment. City may withdraw
approval for conduct of the HERO Program within the jurisdictional limits of City upon
thirty (30) days written notice to WRCOG without liability to the Authority or any affiliated
entity. City withdrawal shall not affect the validity of any voluntary assessment contracts
(a) entered prior to the date of such withdrawal or (b) entered into after the date of such
withdrawal so long as the applications for such voluntary assessment contracts were
submitted to and approved by WRCOG prior to the date of City's notice of withdrawal.
2. Mutual Indemnification and Liability. Authority and City shall mutually
defend, indemnify and hold the other party and its directors, officials, officers,
employees and agents free and harmless from any and all claims, demands, causes of
action, costs, expenses, liabilities, losses, damages or injuries of any kind, in law or
equity, to property or persons, including wrongful death, to the extent arising out of the
willful misconduct or negligent acts, errors or omissions of the indemnifying party or its
directors, officials, officers, employees and agents in connection with the California
HERO Program administered under this JPA Amendment, including without limitation
the payment of expert witness fees and attorneys' fees and other related costs and
expenses, but excluding payment of consequential damages. Without limiting the
foregoing, Section 5.2 of the Authority JPA shall not apply to this JPA Amendment. In
no event shall any of Authority's Regular Members or their officials, officers or
employees be held directly liable for any damages or liability resulting out of this JPA
Amendment.
3. Environmental Review. Authority shall be the lead agency under the
California Environmental Quality Act for any environmental review that may be required
in implementing or administering the California HERO Program under this JPA
Amendment.
4. Cooperative Effort. City shall cooperate with Authority by providing
information and other assistance in order for Authority to meet its obligations hereunder.
City recognizes that one of its responsibilities related to the California HERO Program
will include any permitting or inspection requirements as established by City.
5. Notice. Any and all communications and /or notices in connection with this
JPA Amendment shall be either hand - delivered or sent by United States first class mail,
postage prepaid, and addressed as follows:
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33 of 75 September 2, 2014 Item # 4.2
Authority:
Western Riverside Council of Governments
4080 Lemon Street, 3rd Floor. MS1032
Riverside, CA 92501 -3609
Attn: Executive Director
City:
City of Poway
P.O. Box 789
Poway, CA 92079 -0789
Attn: Director of Public Works
6. Entire Agreement. This JPA Amendment, together with the Authority JPA,
constitutes the entire agreement among the Parties pertaining to the subject matter
hereof. This JPA Amendment supersedes any and all other agreements, either oral or
in writing, among the Parties with respect to the subject matter hereof and contains all
of the covenants and agreements among them with respect to said matters, and each
Party acknowledges that no representation, inducement, promise of agreement, oral or
otherwise, has been made by the other Party or anyone acting on behalf of the other
Party that is not embodied herein.
7. Successors and Assigns. This JPA Amendment and each of its
covenants and conditions shall be binding on and shall inure to the benefit of the Parties
and their respective successors and assigns. A Party may only assign or transfer its
rights and obligations under this JPA Amendment with prior written approval of the other
Party, which approval shall not be unreasonably withheld.
8. Attorney's Fees. If any action at law or equity, including any action for
declaratory relief is brought to enforce or interpret the provisions of this Agreement,
each Party to the litigation shall bear its own attorney's fees and costs.
9. Governing Law. This JPA Amendment shall be governed by and
construed in accordance with the laws of the State of California, as applicable.
10. No Third Party Beneficiaries. This JPA Amendment shall not create any
right or interest in the public, or any member thereof, as a third party beneficiary hereof,
nor shall it authorize anyone not a Party to this JPA Amendment to maintain a suit for
personal injuries or property damages under the provisions of this JPA Amendment.
The duties, obligations, and responsibilities of the Parties to this JPA Amendment with
respect to third party beneficiaries shall remain as imposed under existing state and
federal law.
11. Severability. In the event one or more of the provisions contained in this
JPA Amendment is held invalid, illegal or unenforceable by any court of competent
jurisdiction, such portion shall be deemed severed from this JPA Amendment and the
remaining parts of this JPA Amendment shall remain in full force and effect as though
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34 of 75 September 2, 2014 Item # 4.2
such invalid, illegal, or unenforceable portion had never been a part of this JPA
Amendment.
12. Headings. The paragraph headings used in this JPA Amendment are for
the convenience of the Parties and are not intended to be used as an aid to
interpretation.
13. Amendment. This JPA Amendment may be modified or amended by the
Parties at any time. Such modifications or amendments must be mutually agreed upon
and executed in writing by both Parties. Verbal modifications or amendments to this
JPA Amendment shall be of no effect.
14. Effective Date. This JPA Amendment shall become effective upon the
execution thereof by the Parties hereto.
IN WITNESS WHEREOF, the Parties hereto have caused this JPA Amendment to be
executed and attested by their officers thereunto duly authorized as of the date first
above written.
Don Higginson, Mayor
ATTEST:
Sheila R. Cobian, CMC, City Clerk
Approved as to Form:
Morgan L. Foley, City Attorney
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35 of 75 September 2, 2014 Item # 4.2
Updated through July, 2012
JOINT POWERS AGREEMENT OF
THE WESTERN RIVERSIDE
COUNCIL OF GOVERNMENTS
This Agreement is made and entered into on the 1 st day of April, 1991, pursuant to
Government Code Section 6500 et. seq. and other pertinent provisions of law, by and
between six or more of the cities located within Western Riverside County and the County
of Riverside.
RECITALS
A. Each member and party to this Agreement is a governmental entity
established by law with full powers of government in legislative, administrative, financial,
and other related fields.
B. The purpose of the formation is to provide an agency to conduct studies and
projects designed to improve and coordinate the common governmental responsibilities
and services on an area -wide and regional basis through the establishment of an
association of governments. The Council will explore areas of inter - governmental
cooperation and coordination of government programs and provide recommendations and
solutions to problems of common and general concern.
C. When authorized pursuant to an Implementation Agreement, the Council shall
manage and administer thereunder.
NOW, THEREFORE, in consideration of the mutual promises and covenants herein
contained, the parties hereto agree as follows:
Attachment E
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36 of 75 September 2, 2014 Item # 4.2
PURPOSE AND POWERS
1.1 Agency Created.
There is hereby created a public entity to be known as the "Western Riverside
Council of Governments" ( "WRCOG "). WRCOG is formed by this Agreement pursuant to
the provision of Government Code Section 6500 et. seq. and other pertinent provision of
law. WRCOG shall be a public entity separate from the parties hereto.
1.2 Powers.
1.2.1. WRCOG established hereunder shall perform all necessary functions
to fulfill the purposes of this Agreement. Among other functions, WRCOG shall:
a. Serve as a forum for consideration, study and recommendation on
area -wide and regional problems;
b. Assemble information helpful in the consideration of problems peculiar
to Western Riverside County;
C. Explore practical avenues for intergovernmental cooperation,
coordination and action in the interest of local public welfare and means of improvements in
the administration of governmental services; and
d. Serve as the clearinghouse review body for Federally- funded projects
in accordance with Circular A-95 in conjunction with the Southern California Association of
Governments.
1.2.2. The Council shall have the power in its own name to do any of the
following;
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37 of 75 September 2, 2014 Item # 4.2
a. When necessary for the day to day operation of the Council, to make
and enter into contracts;
b. To contract for the services of engineers, attorneys, planners, financial
consultants and separate and apart therefrom to employ such other persons, as it deems
necessary;
C. To apply for an appropriate grant or grants under any federal, state, or
local programs.
d. To receive gifts, contributions and donations of property, funds,
services and other forms of financial assistance from persons, firms, corporations and any
governmental entity;
e. To lease, acquire, construct, manage, maintain, and operate any
buildings, works, or improvements;
f. To delegate some or all of its powers to the Executive Committee and
the Executive Director of the Council as hereinafter provided.
1.2.3 The association shall have the power in its own name, only with the
approval of all affected member agencies to;
a. Acquire, hold and dispose of property by eminent domain, lease, lease
purchase or sale.
b. To incur debts, liabilities, obligations, and issue bonds;
II.
ORGANIZATION OF COUNCIL
2.1 Parties.
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September 2, 2014 Item # 4.2
The parties to WRCOG shall be the County of Riverside and each city located
within Western Riverside County which has executed or hereafter executes this Agreement,
or any addenda, amendment, or supplement thereto and agrees to such become a member
upon such terms and conditions as established by the general council or executive
committee, and which has not, pursuant to provisions hereof, withdrawn therefrom. Only
the parties identified in this section shall be considered contracting parties to the JPA under
Government Code section 6502.
2.2 Names.
The names, particular capacities and addresses of the parties at any time shall be
shown on Exhibit "A" attached hereto, as amended or supplemented from time to time.
2.3 Duties.
WRCOG shall do whatever is necessary and required to carry out the
purposes of this agreement and when authorized by an Implementation Agreement
pursuant to section 1.2.3 as appropriate, to make and enter into such contracts, incur such
debts and obligations, assess contributions from the members, and perform such other acts
as are necessary to the accomplishment of the purposes of such agreement, within the
provisions of Government Code Section 6500 et seq. and as prescribed by the laws of the
State of California.
2.4 Governinq Body.
2.4.1. WRCOG shall be governed by a General Assembly with membership
consisting of the appropriate representatives from the County of Riverside, each city which
is a signatory to this Agreement, Western Municipal Water District, and Eastern Municipal
Water District, the number of which shall be determined as hereinafter set forth. The
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39 of 75 September 2, 2014 Item # 4.2
General Assembly shall meet at least once annually, preferably scheduled in the evening.
Each member agency of the General Assembly shall have one vote for each mayor, council
member, county supervisor, and water district board member present at the General
Assembly. The General Assembly shall act only upon a majority of a quorum. A quorum
shall consist of a majority of the total authorized representatives, provided that members
representing a majority of the member agencies are present. The General Assembly shall
adopt and amend by -laws for the administration and management of this Agreement, which
when adopted and approved shall be an integral part of this Agreement. Such by -laws may
provide for the management and administration of this Agreement.
2.4.2. There shall be an Executive Committee which exercises the powers of
this Agreement between sessions of the General Assembly. Members of the Executive
Committee shall be the Mayor from each of the member cities, four members of the
Riverside County Board of Supervisors and the President of each Water District, the
remaining member of the Board of Supervisors shall serve as an alternate, except any City
Council, at its discretion, can appoint a Mayor Pro Tem or other city council member in
place of the Mayor, and each water district board, at its discretion, can appoint another
board member in place of the President. The Executive Committee shall act only upon a
majority of a quorum. A quorum shall consist of a majority of the member agencies.
Membership of the Water Districts on the General Assembly and Executive Committee of
WRCOG shall be conditioned on the Water Districts entering into a separate
Memorandums of Understanding with WRCOG. Membership of the Riverside County
Superintendent of Schools on the General Assembly and Executive Committee of WRCOG
20323.00016 \7651699.1 5
40 of 75 September 2, 2014 Item # 4.2
shall be conditioned on the Superintendent of Schools entering into a separate
Memorandums of Understanding with WRCOG.
2.4.3. Each member of the General Assembly and the Executive Committee
shall be a current member of the legislative body such member represents.
2.4.4. Each participating member on the Executive Committee shall also
have an alternate, who must also be a current member of the legislative body of the party
such alternate represents. The name of the alternate members shall be on file with the
Executive Committee. In the absence of the regular member from an agency, the alternate
member from such agency shall assume all rights and duties of the absent regular
member.
2.5 Executive Director.
The Executive Director shall be the chief administrative officer of the Council.
He shall receive such compensation as may be fixed by the Executive Committee. The
powers and duties of the Executive Director shall be subject to the authority of the
Executive Committee and include the following:
a. To appoint, direct and remove employees of the Council.
b. Annually to prepare and present a proposed budget to the Executive
Committee and General Assembly.
C. Serve as Secretary of the Council and of the Executive Committee.
d. To attend meetings of the Executive Committee.
e. To perform such other and additional duties as the Executive Committee may
require.
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41 of 75 September 2, 2014 Item # 4.2
2.6 Principal Office.
The principal office of WRCOG shall be established by the Executive
Committee and shall be located within Western Riverside County. The Executive
Committee is hereby granted full power and authority to change said principal office from
one location to another within Western Riverside County. Any change shall be noted by the
Secretary under this section but shall not be considered an amendment to this Agreement.
2.7 Meetings.
The Executive Committee shall meet at the principal office of the agency or at
such other place as may be designated by the Executive Committee. The time and place
of regular meetings of the Executive Committee shall be determined by resolution adopted
by the Executive Committee; a copy of such resolution shall be furnished to each party
hereto. Regular, adjourned and special meetings shall be called and conducted in
accordance with the provisions of the Ralph M. Brown Act, Government Code Section
54950 et. seq., as it may be amended.
2.8 Powers and Limitations of the Executive Committee.
Unless otherwise provided herein, each member or participating alternate of
the Executive Committee shall be entitled to one vote, and a vote of the majority of those
present and qualified to vote constituting a quorum may adopt any motion, resolution, or
order and take any other action they deem appropriate to carry forward the objectives of
the Council.
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42 of 75 September 2, 2014 Item # 4.2
2.9 Minutes.
The secretary of the Council shall cause to be kept minutes of regular
adjourned regular and special meetings of the General Assembly and Executive
Committee, and shall cause a copy of the minutes to be forwarded to each member and to
each of the members hereto.
2.10 Rules.
The Executive Committee may adopt from time to time such rules and
regulations for the conduct of its affairs consistent with this agreement or any
Implementation Agreement.
2.11 Vote or Assent of Members.
The vote, assent or approval of the members in any manner as may be
required, hereunder shall be evidenced by a certified copy of the action of the governing
body of such party filed with the Council. It shall be the responsibility of the Executive
Director to obtain certified copies of said actions.
2.12 Officers.
There shall be selected from the membership of the Executive Committee, a
chairperson and a vice chairperson. The Executive Director shall be the secretary. The
Treasurer of the County of Riverside shall be the Treasurer of the Council and the
Controller or Auditor of the County of Riverside shall be the Auditor of the Council. Such
persons shall possess the powers of, and shall perform the treasurer and auditor functions
respectively, for WRCOG and perform those functions required of them by Government
Code Sections 6505, 6505.5 and 6505.6, and by all other applicable laws and regulations,
including any subsequent amendments thereto.
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43 of 75 September 2, 2014 Item # 4.2
The chairperson and vice chairperson, shall hold office for a period of one
year commencing July 1st of each and every fiscal year; provided, however, the first
chairperson and vice chairperson appointed shall hold office from the date of appointment
to June 30th of the ensuing fiscal year. Except for the Executive Director, any officer,
employee, or agent of the Executive Committee may also be an officer, employee, or agent
of any of the members. The appointment by the Executive Committee of such a person
shall be evidence that the two positions are compatible.
2.13 Committees.
The Executive Committee may, as it deems appropriate, appoint committees
to accomplish the purposes set forth herein. All committee meetings of WRCOG, including
those of the Executive Committee, shall be open to all members.
2.14 Additional Officers and Employees.
The Executive Committee shall have the power to authorize such additional
officers and assistants as may be appropriate. Such officers and employees may also be,
but are not required to be, officers and employees of the individual members.
2.15 Bondinq Requirement.
The officers or persons who have charge of, handle, or have access to any
property of WRCOG shall be the members of the Executive Committee, the treasurer, the
Executive Director, and any other officers or persons to be designated or empowered by
the Executive Committee. Each such officer or person shall be required to file an official
bond with the Executive Committee in an amount which shall be established by the
Executive Committee. Should the existing bond or bonds of any such officer be extended
to cover the obligations provided herein, said bond shall be the official bond required
20323.00016 \7651699.1 9
44 of 75 September 2, 2014 Item # 4.2
herein. The premiums on any such bonds attributable to the coverage required herein shall
be appropriate expenses of WRCOG.
2.16 Status of Officers and Employees.
All of the privileges and immunities from liability, exemption from laws,
ordinances and rules, all pension, relief, disability, worker's compensation, and other
benefits which apply to the activity of officers, agents, or employees of any of the members
when performing their respective functions shall apply to them to the same degree and
extent while engaged in the performance of any of the functions and other duties under this
Agreement. None of the officers, agents, or employees appointed by the Executive
Committee shall be deemed, by reason of their employment by the Executive Committee,
to be employed by any of the members or, by reason of their employment by the Executive
Committee, to be subject to any of the requirements of such members.
2.17 Restrictions.
Pursuant to Government Code Section 6509, for the purposes of determining the
restrictions to be imposed by the Council in its exercise of the above - described joint
powers, reference shall be made to, and the Council shall observe, the restrictions imposed
upon the County of Riverside.
2.18 Water Districts and TUMF Matters.
Pursuant to this Joint Powers Agreement, WRCOG administers the Transportation
Mitigation Fee ( "TUMF ") for cities in western Riverside County. The fee was established
prior to the Water District's involvement with WRCOG and will fund transportation
improvements for the benefit of the County of Riverside and the cities in western Riverside
County. As such, the Western Municipal Water District and the Eastern Municipal Water
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45 of 75 September 2, 2014 Item # 4.2
District General Assembly and Executive Committee Members shall not vote on any matter
related to the administration of the TUMF program or the expenditure of TUMF revenues.
FUNDS AND PROPERTY
3.1 Treasurer.
The Treasury of the member agency whose Treasurer is the Treasurer for WRCOG
shall be the depository for WRCOG. The Treasurer of the Council shall have custody of all
funds and shall provide for strict accountability thereof in accordance with Government
Code Section 6505.5 and other applicable laws of the State of California. He or she shall
perform all of the duties required in Government Code Section 6505 and following, such
other duties as may be prescribed by the Executive Committee.
3.2. Expenditure of Funds.
The funds under this Agreement shall be expended only in furtherance of the
purposes hereof and in accordance with the laws of the State of California and standard
accounting practices shall be used to account for all funds received and disbursed.
3.3. Fiscal Year.
WRCOG shall be operated on a fiscal year basis, beginning on July 1 of each year
and continuing until June 30 of the succeeding year. Prior to July 1 of each year, the
General Assembly shall adopt a final budget for the expenditures of WRCOG during the
following fiscal Year.
3.4. Contributions /Public Funds.
In preparing the budget, the General Assembly by majority vote of a quorum shall
determine the amount of funds which will be required from its members for the purposes of
20323.00016 \7651699.1 11
46 of 75 September 2, 2014 Item # 4.2
this Agreement. The funds required from its members after approval of the final budget
shall be raised by contributions 50% of which will be assessed on a per capita basis and
50% on an assessed valuation basis, each city paying on the basis of its population and
assessed valuation and the County paying on the basis of the population and assessed
valuation within the unincorporated area of Western Riverside County as defined in the
by -laws. The parties, when informed of their respective contributions, shall pay the same
before August Ist of the fiscal yearforwhich they are assessed orwithin sixty days of being
informed of the assessment, whichever occurs later. In addition to the contributions
provided, advances of public funds from the parties may be made for the purposes of this
Agreement. When such advances are made, they shall be repaid from the first available
funds of WRCOG.
The General Assembly shall have the power to determine that personnel, equipment
or property of one or more of the parties to the Agreement may be used in lieu of fund
contributions or advances.
All contributions and funds shall be paid to WRCOG and shall be disbursed by a
majority vote of a quorum of the Executive Committee, as authorized by the approved
budget.
3.5 Contribution from Water Districts.
The provision of section 3.4 above shall be inapplicable to the Western Municipal
Water District and the Eastern Municipal Water District. The amount of contributions from
these water districts shall be through the WRCOG budget process.
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47 of 75 September 2, 2014 Item # 4.2
Iv
BUDGETS AND DISBURSEMENTS
4.1 Annual Budget.
The Executive Committee may at any time amend the budget to incorporate
additional income and disbursements that might become available to WRCOG for its
purposes during a fiscal year.
4.2 Disbursements.
The Executive Director shall request warrants from the Auditor in accordance
with budgets approved by the General Assembly or Executive Committee subject to
quarterly review by the Executive Committee. The Treasurer shall pay such claims or
disbursements and such requisitions for payment in accordance with rules, regulations,
policies, procedures and bylaws adopted by the Executive Committee.
4.3 Accounts.
All funds will be placed in appropriate accounts and the receipt, transfer, or
disbursement of such funds during the term of this Agreement shall be accounted for in
accordance with generally accepted accounting principles applicable to governmental
entities and pursuant to Government Code Sections 6505 et seq. and any other applicable
laws of the State of California. There shall be strict accountability of all funds. All revenues
and expenditures shall be reported to the Executive Committee.
4.4 Expenditures Within Approved Annual Budget.
All expenditures shall be made within the approved annual budget. No
expenditures in excess of those budgeted shall be made without the approval of a majority
of a quorum of the Executive Committee.
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4.5 Audit.
The records and accounts of WRCOG shall be audited annually by an
independent certified public accountant and copies of such audit report shall be filed with
the County Auditor, State Controller and each party to WRCOG no later than fifteen (15)
days after receipt of said audit by the Executive Committee.
4.6 Reimbursement of Funds.
Grant funds received by WRCOG from any federal, state, or local agency to
pay for budgeted expenditures for which WRCOG has received all or a portion of said funds
from the parties hereto shall be used as determined by WRCOG's Executive
Committee.
V
LIABILITIES
5.1 Liabilities.
The debts, liabilities, and obligation of WRCOG shall be the debts, liabilities,
or obligations of WRCOG alone and not of the parties to this Agreement.
5.2 Hold Harmless and Indemnity.
Each party hereto agrees to indemnify and hold the other parties harmless
from all liability for damage, actual or alleged, to persons or property arising out of or
resulting from negligent acts or omissions of the indemnifying party or its employees.
Where the General Assembly or Executive Committee itself or its agents or employees are
held liable for injuries to persons or property, each party's liability for contribution or
indemnity for such injuries shall be based proportionately upon the contributions (less
voluntary contributions) of each member. In the event of liability imposed upon any of the
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49 of 75 September 2, 2014 Item # 4.2
parties to this Agreement, or upon the General Assembly or Executive Committee created
by this Agreement, for injury which is caused by the negligent or wrongful act or omission of
any of the parties in the performance of this Agreement, the contribution of the party or
parties not directly responsible for the negligent or wrongful act or omission shall be limited
to One Hundred Dollars ($100.00). The party or parties directly responsible for the
negligent or wrongful acts or omissions shall indemnify, defend, and hold all other parties
harmless from any liability for personal injury or property damage arising out of the
performance of this Agreement. The voting for or against a matter being considered by the
General Assembly or executive or other committee or WRCOG, or abstention from voting
on such matter, shall not be construed to constitute a wrongful act or omission within the
meaning of this Subsection.
ADMISSION AND WITHDRAWAL OF PARTIES
6.1 Admission of New Parties.
It is recognized that additional cities other than the original parties, may wish
to participate in WRCOG. Any Western Riverside County city may become a party to
WRCOG upon such terms and conditions as established by the General Assembly or
Executive Committee. Any Western Riverside County city shall become a party to WRCOG
by the adoption by the city council of this agreement and the execution of a written
addendum thereto agreeing to the terms of this Agreement and agreeing to any additional
terms and conditions that may be established by the general assembly or Executive
Committee. Special districts which are significantly involved in regional problems and the
boundaries of which include territory within the collective area of the membership shall be
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50 of 75 September 2, 2014 Item # 4.2
eligible for advisory membership in the Council. The representative of any such advisory
member may participate in the work of committees of the Council.
6.2 Withdrawal from WRCOG.
It is fully anticipated that each party hereto shall participate in WRCOG until
the purposes set forth in this Agreement are accomplished. The withdrawal of any party,
either voluntary or involuntary, unless otherwise provided by the General Assembly or
Executive Committee, shall be conditioned as follows:
a. In the case of a voluntary withdrawal following a properly noticed public
hearing, written notice shall be given to WRCOG, six months prior to the effective date of
withdrawal;
b. Withdrawal shall not relieve the party of its proportionate share of any
debts or other liabilities incurred by WRCOG prior to the effective date of the parties' notice
of withdrawal;
C. Unless otherwise provided by a unanimous vote of the Executive
Committee, withdrawal shall result in the forfeiture of that party's rights and claims relating
to distribution of property and funds upon termination of WRCOG as set forth in Section VII
below;
d. Withdrawal from any Implementation Agreement shall not be deemed
withdrawal from membership in WRCOG.
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VII
TERMINATION AND DISPOSITION OF ASSETS
7.1 Termination of this Agreement.
WRCOG shall continue to exercise the joint powers herein until the
termination of this Agreement and any extension thereof or until the parties shall have
mutually rescinded this Agreement; providing, however, that WRCOG and this Agreement
shall continue to exist for the purposes of disposing of all claims, distribution of assets and
all other functions necessary to conclude the affairs of WRCOG.
Termination shall be accomplished by written consent of all of the parties, or
shall occur upon the withdrawal from WRCOG of a sufficient number of the agencies
enumerated herein so as to leave less than five of the enumerated agencies remaining in
WRCOG.
7.2 Distribution of Property and Funds.
In the event of the termination of this Agreement, any property interest
remaining in WRCOG following the discharge of all obligations shall be disposed of as the
Executive Committee shall determine with the objective of distributing to each remaining
party a proportionate return on the contributions made to such properties by such parties,
less previous returns, if any.
VIII
IMPLEMENTATION AGREEMENTS
8.1 Execution of Agreement.
When authorized by the Executive Committee, any affected member agency
or agencies enumerated herein, may execute an Implementation Agreement for the
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52 of 75 September 2, 2014 Item # 4.2
purpose of authorizing WRCOG to implement, manage and administer area -wide and
regional programs in the interest of the local public welfare. The costs incurred by WRCOG
in implementing a program including indirect costs, shall be assessed only to those public
agencies who are parties to that Implementation Agreement.
IX
MISCELLANEOUS
9.1 Amendments.
This Agreement may be amended with the approval of not less than
two- thirds (2/3) of all member agencies.
9.2 Notice.
Any notice or instrument required to be given or delivered by depositing the
same in any United States Post Office, registered or certified, postage prepaid, addressed
to the addresses of the parties as shown on Exhibit "A ", shall be deemed to have been
received by the party to whom the same is addressed at the expiration of seventy -two (72)
hours after deposit of the same in the United States Post Office for transmission by
registered or certified mail as aforesaid.
9.3 Effective Date.
This Agreement shall be effective and WRCOG shall exist from and after such
date as this Agreement has been executed by any seven or more of the public agencies,
including the County of Riverside, as listed on page 1 hereof.
9.4 Arbitration.
Any controversy or claim between any two or more parties to this Agreement,
or between any such party or parties and WRCOG, with respect to disputes, demands,
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53 of 75 September 2, 2014 Item # 4.2
differences, controversies, or misunderstandings arising in relation to interpretation of this
Agreement, or any breach thereof, shall be submitted to and determined by arbitration.
The party desiring to initiate arbitration shall give notice of its intention to arbitrate to every
other party to this Agreement and to the Executive Director of the Council. Such notice
shall designate as "respondents" such other parties as the initiating party intends to have
bound by any award made therein. Any party not so designated but which desires to join in
the arbitration may, within ten (10) days of service upon it of such notice, file with all other
parties and with the Executive Director of the Council a response indicating its intention to
join in and to be bound by the results of the arbitration, and further designating any other
parties it wishes to name as a respondent. Within twenty (20) days of the service of the
initial demand for arbitration, the initiating party and the respondent or respondents shall
each designate a person to act as an arbitrator. The designated arbitrators shall mutually
designate the minimal number of additional persons as arbitrators as may be necessary to
create an odd total number of arbitrators but not less than three to serve as arbitrator(s).
The arbitrators shall proceed to arbitrate the matter in accordance with the
provisions of Title 9 of Part 3 of the Code of Civil Procedure, Section 1280 et. seq. The
parties to this Agreement agree that the decision of the arbitrators will be binding and will
not be subject to judicial review except on the ground that the arbitrators have exceeded
the scope of their authority.
9.5 Partial Invalidity.
If any one or more of the terms, provisions, sections, promises, covenants or
conditions of this Agreement shall to any extent be adjudged invalid, unenforceable, void or
voidable for any reason whatsoever by a court of competent jurisdiction, each and all of the
20323.00016 \7651699.1 19
54 of 75 September 2, 2014 Item # 4.2
remaining terms, provisions, sections, promises, covenants and conditions of this
Agreement shall not be affected thereby and shall be valid and enforceable to the fullest
extent permitted by law.
9.6 Successors.
This Agreement shall be binding upon and shall inure to the benefit of the
successors of the parties hereto.
9.7 Assignment.
The parties hereto shall not assign any rights or obligations under this
Agreement without written consent of all other parties.
9.8 Execution.
The Board of Supervisors of the County of Riverside and the city councils of
the cities enumerated herein have each authorized execution of this Agreement as
evidenced by the authorized signatures below, respectively.
20323.00016 \7651699.1 20
55 of 75 September 2, 2014 Item # 4.2
Original Members Agencies
1. City of Banning
2. City of Beaumont (withdrawn)
3. City of Calimesa
4. City of Canyon Lake
5. City of Corona
6. City of Hemet
7. City of Lake Elsinore
8. City of Moreno Valley
9. City of Murrieta
10. City of Norco
11. City of Perris
12. City of Riverside
13. City of San Jacinto
14. City of Temecula
15. County of Riverside
Additional City Members
1. City of Eastvale (added on 08/02/2010, Resolution 01 -11)
2. City of Jurupa Valley (added on 07/29/2011, Resolution 02 -12)
3. City of Menifee (added on 10/06/2008, Resolution 03 -09)
4. City of Wildomar (added on 08/04/2008, Resolution 01 -09)
20323.00016 \7651699.1 21
56 of 75 September 2, 2014 Item # 4.2
THE WESTERN RIVERSIDE
COUNCIL OF GOVERNMENTS
Participating Agencies
5. Eastern Municipal Water District (membership on the Governing Board
of WRCOG, 05/11/2009)
6. Riverside County Superintendent of Schools (membership as an ex-
officio, advisory member of WRCOG, 11 /07/2011)
7. Western Municipal Water District (membership on the Governing Board
of WRCOG, 05/11/2009)
20323.00016 \7651699.1 22
57 of 75 September 2, 2014 Item # 4.2
RESOLUTION NO. 14-
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF POWAY, CALIFORNIA,
CONSENTING TO THE INCLUSION OF PROPERTIES WITHIN
THE INCORPORATED AREA OF THE CITY IN THE
SAN DIEGO COUNTY PROPERTY ASSESSED CLEAN ENERGY
PROGRAM TO FINANCE DISTRIBUTED GENERATION RENEWABLE
ENERGY SOURCES AND ENERGY AND WATER EFFICIENCY
IMPROVEMENTS, APPROVING THE REPORT SETTING FORTH THE
PARAMETERS OF THE REFERENCED PROGRAM AND CERTAIN
MATTERS IN CONNECTION THEREWITH
WHEREAS, the California Enterprise Development Authority ( "CEDA ") is a joint
exercise of powers authority, comprised of cities and counties in the State of California,
including the City Poway (the "City "); and
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 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 Board of Supervisors (the "Board of Supervisors ") of the County
of San Diego, a political subdivision of the State of California (the "County "), has
adopted Figtree PACE pursuant to the Act; and
WHEREAS, the parameters of Figtree PACE are set forth in the Program Report
and such Report has been prepared pursuant to Section 5898.22 of the Act and
approved by the CEDA Board of Directors; and
WHEREAS, the City Council (the "City Council ") of the City of Poway (the "City),
through its authorized representatives, has reviewed the Report;
WHEREAS, the Act authorizes CEDA to enter into contractual assessments with
property owners located within incorporated cities in the County of San Diego upon the
approval of the legislative body of the related City to participate in Figtree PACE; and
WHEREAS, Senate Bill 96 (2013) amended Public Resources Code section
26060 in order to implement a PACE risk mitigation program for PACE loans to be
Attachment F
58 of 75 September 2, 2014 Item # 4.2
Resolution No. 14 -xx
Page 2
administered by the California Alternative Energy and Advanced Transportation
Financing Authority; and
WHEREAS, in light of this new development and growing public interest, the City
is interested in offering residential PACE options to eligible participants within the City
limits contingent on the Figtree PACE Program meeting certain programmatic
requirements; and
WHEREAS, pursuant to Chapter 29, the City authorizes CEDA to 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, although no liabilities to the City exist, to protect the City in
connection with operation of the Figtree PACE against any alleged liabilities, Figtree
Energy Financing, the program administrator, has agreed to defend and indemnify the
City; and
WHEREAS, the City may repeal this Resolution, withdraw its membership in
CEDA, and terminate its participation in the Figtree PACE Program, upon written notice
to CEDA, should it be determined at any time that it no longer desires to continue in the
Figtree PACE Program; and
WHEREAS, the City will not be responsible for 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.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Poway
as follows:
Section 1: Good Standing. The City is either a municipal corporation or other
public body and a member of CEDA in good standing.
Section 2: Resolution of Intention. The City Council ratifies the resolution
adopted by the CEDA Board of Directors on September 12, 2013 declaring the Board's
intention to order the implementation of a contractual assessment program to finance
Improvements pursuant to the Act.
Section 3: Boundaries. The City Council hereby approves the inclusion in
Figtree PACE all of the properties in the incorporated area within the City, as same may
be amended through annexation from time to time, the acquisition, construction and
installation within City limits of the energy and water efficiency measures set forth in the
Report upon the request and agreement of the affected property owner, and the
assumption of jurisdiction thereof by CEDA for the aforesaid purposes. The adoption of
this Resolution by this City Council constitutes the approval by the City to participate in
Figtree PACE. This City Council further authorizes CEDA to set the terms of, and
implement, Figtree PACE and take each and every action necessary or desirable for
59 of 75 September 2, 2014 Item # 4.2
Resolution No. 14 -xx
Page 3
financing the Improvements, including the levying, collecting and enforcement of the
contractual assessments to finance the Improvements and the issuance of bonds, notes
or other forms of indebtedness secured by such contractual assessments as authorized
by Chapter 29.
Section 4: Appointment of CEDA. The City hereby appoints CEDA as its
representative to (i) record the assessment against the Participating Parcels, (ii)
administer the District in accordance with the Improvement Act of 1915 (Chapter 29 Part
1 of Division 10 of the California Streets and Highways Code (commencing with Section
8500 et seq.) (the "Law "), (iii) prepare program guidelines for the operations of the
Program and (iv) proceed with any claims, proceedings or legal actions as shall be
necessary to collect past due assessments on the properties within the District in
accordance with the Law and Section 6509.6 of the California Government Code. The
City is not and will not be deemed to be an agent of Figtree or CEDA as a result of this
Resolution.
Section 5: Program Report. The City 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 6: Foreclosure. The City Council hereby acknowledges that the Law
permits foreclosure in the event that there is a default in the payment of assessments
due on a property. The City Council hereby designates CEDA as its representative to
proceed with collection and foreclosure of the liens on the defaulting properties within
the District, including accelerated foreclosure pursuant to the Program Report.
Section 7: Indemnification. Although no liabilities exist for the City, the City
Council acknowledges that Figtree has provided the City with an indemnification
agreement, as shown in Exhibit A, in case of allegations of liabilities or allegations of
negligence or malfeasance of any type as a result of the acts or omissions of Figtree, its
officers, employees, subcontractors and agents. The City Council hereby authorizes the
appropriate officials and staff of the City to execute and deliver the Indemnification
Agreement to Figtree.
Section 8: Repeal. The City may repeal this Resolution, withdraw from its
membership in CEDA, and terminate its participation in the Figtree PACE Program,
upon written notice to the Council, should it be determined at any time that it no longer
desires to continue as a member of CEDA.
Section 9: CEQA. The City 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 potentially significant physical impact on the environment, as
contemplated by Title 14, California Code of Regulations, Section 15378(b )( 4)).
60 of 75 September 2, 2014 Item # 4.2
Resolution No. 14 -xx
Page 4
Section 10: Effective Date. This Resolution shall take effect immediately upon
its adoption. The City Clerk is hereby authorized and directed to transmit a certified
copy of this resolution to Figtree Energy Financing.
Section 11: Costs. Services related to the formation and administration of the
assessment district will be provided by CEDA at no cost to the City.
Section 12: Program Requirements. The City's participation in the Figtree
PACE program is subject to the condition that the Figtree PACE Program has, or will
(within 180 days following City's effective date as an Associate Member), meets the
following requirements:
a. The Figtree PACE Program is enrolled in the state PACE Loss
Reserve Program:
b. The Figtree PACE Program will implement policies that requires that it
will provide full and understandable disclosures to program applicants,
including but not limited to the disclosure that participation in the PACE
program may trigger acceleration of existing obligations of an existing
mortgage and that the participant may be required to prepay the
contractual assessments and all associated fees and penalties upon
the refinancing or sale of the property.
PASSED, ADOPTED AND APPROVED by the City Council of the City of Poway
at a regular meeting this 2nd day of September, 2014.
Don Higginson, Mayor
ATTEST:
Sheila R. Cobian, CMC, City Clerk
61 of 75 September 2, 2014 Item # 4.2
Resolution No. 14 -xx
Page 5
STATE OF CALIFORNIA )
) SS
COUNTY OF SAN DIEGO )
I, Sheila R. Cobian, CIVIC, City Clerk, of the City of Poway, do hereby certify under
penalty of perjury that the foregoing Resolution No. 14 - * ** was duly adopted by the City
Council at a meeting of said City Council held on the 2nd day of September, 2014, and
that it was so adopted by the following vote:
AYES:
NOES:
ABSENT:
DISQUALIFIED:
Sheila R. Cobian, CIVIC, City Clerk
City of Poway
ATTACHMENTS:
Exhibit A: Indemnification Agreement
62 of 75 September 2, 2014 Item # 4.2
EXHIBIT A
Indemnification Agreement
INDEMNIFICATION AGREEMENT
BY AND BETWEEN
THE CITY OF POWAY AND
FIGTREE COMPANY, INC.
This Indemnification Agreement (the "Agreement ") is entered into by and between the
City of Poway, a municipal corporation or political subdivision, duly organized and existing
under the laws of the State of California (the "Public Entity ") and Figtree Company, Inc., a
California corporation, the administrator of the Figtree Property Assessed Clean Energy
and Job Creation Program (the "Administrator "), which is a program of the California
Enterprise Development Authority, a California joint exercise of powers authority (the
"Authority ").
RECITALS
WHEREAS, the Authority is a joint exercise of powers authority whose members
include the Public Entity in addition to other cities and counties in the State of California;
and
WHEREAS, the Authority established the Figtree Property Assessed Clean Energy
and Job Creation Program (the " Figtree PACE Program ") to allow the financing of certain
renewable energy, energy efficiency and water efficiency improvements that are
permanently affixed to real property through the levy of assessments voluntarily agreed to
by the participating property owners pursuant to Chapter 29 of Division 7 of the Streets
and Highways Code ( "Chapter 29 ") and the issuance of improvement bonds, or other
forms of indebtedness, under the Improvement Bond Act of 1915 upon the security of the
unpaid assessments; and
WHEREAS, the Authority has conducted or will conduct proceedings required by
Chapter 29 with respect to the territory within the boundaries of the Public Entity; and
WHEREAS, the legislative body of the Public Entity adopted or will adopt a
resolution authorizing the Public Entity to join the Figtree PACE Program; and
WHEREAS, the Public Entity will not be responsible for the formation, operation and
administration of the Figtree PACE Program as well as the sale and issuance of any
bonds or other forms of indebtedness in connection therewith, including the conducting of
assessment proceedings, the levy and collection of assessments and any remedial action
in the case of such assessment payments, and the offer, sale and administration of any
bonds issued by the Authority on behalf of the Figtree PACE Program; and
WHEREAS, the Administrator is the administrator of the Figtree PACE Program and
agrees to indemnify the Public Entity in connection with the operations of the Figtree
PACE Program as set forth herein;
63 of 75 September 2, 2014 Item # 4.2
NOW, THEREFORE, in consideration of the above premises and of the Public
Entity's agreement to join the Figtree PACE Program, the parties agree as follows:
1) Indemnification. Figtree has provided the CEDA with an
indemnification for negligence or malfeasance of any type as a result of the acts or
omissions of Figtree, its officers, employees, subcontractors and agents, arising
from or related to the Figtree PACE Program, the assessments, the assessment
districts, the improvements or the financing and marketing thereof. Although no
liabilities exist for the Public Entity, in case of alleged liabilities, Figtree agrees to
defend, indemnify and hold harmless the Public Entity, its officers, elected or
appointed officials, employees, agents and volunteers from and against any and all
actions, suits, proceedings, claims, demands, losses, costs and expenses, including
legal costs and attorneys' fees, for injury or damage due to negligence or
malfeasance of any type claims as a result of the acts or omissions of Figtree,
except for such loss or damage which was caused by the sole negligence or willful
misconduct of the Public Entity. This indemnity shall apply to all claims and liability
regardless of whether any insurance policies are applicable. The policy limits do not
act as limitation upon the amount of indemnification to be provided by Figtree.
2) Amend ment/Interoretation of this Agreement. This Agreement
represents the entire understanding of the parties as to those matters contained
herein. No prior oral or written understanding shall be of any force or effect with
respect to those matters covered hereunder. No supplement, modification or
amendment of this Agreement shall be binding unless executed in writing by both of
the parties hereto. This Agreement shall not be interpreted for or against any party
by reason of the fact that such party may have drafted this Agreement or any of its
provisions.
3) Section Headings. Section headings in this Agreement are included
for convenience of reference only and shall not constitute a part of this Agreement
for any other purpose.
4) Waiver. No waiver of any of the provisions of this Agreement shall be
binding unless in the form of writing signed by the party against whom enforcement
is sought, and no such waiver shall operate as a waiver of any other provisions
hereof (whether or not similar), nor shall such waiver constitute a continuing waiver.
Except as specifically provided herein, no failure to exercise or any delay in
exercising any right or remedy hereunder shall constitute a waiver thereof.
5) Severability and Governing Law. If any provision or portion thereof of
this Agreement shall be held by a court of competent jurisdiction to be invalid, void,
or otherwise unenforceable, the remaining provisions shall remain enforceable to
the fullest extent permitted by law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of California
applicable to contracts made and to be performed in California.
6) Notices. All notices, demands and other communications required or
permitted hereunder shall be made in writing and shall be deemed to have been
64 of 75 2 September 2, 2014 Item # 4.2
duly given if delivered by hand, against receipt, or mailed certified or registered mail
and addressed as follows:
If to the Administrator:
If to the Public Entity:
Figtree Company, Inc.
9915 Mira Mesa Blvd., Suite 130
San Diego, California 92131
Attn: Chief Executive Officer
City of Poway
P.O. Box 789
Poway, CA 92074 -0789
Attn: Director of Public Works
7) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, which together shall
constitute the same instrument.
8) Effective Date. This Agreement will be effective as of the date of the
signature of Public Entity's representative as indicated below in the signature block.
IN WITNESS HEREOF, the parties hereto duly executed this Agreement as of the date
below.
APPROVED AS TO FORM:
Morgan L. Foley, City Attorney
Public Entity Name
By
Daniel Singer, City Manager
Date:
Figtree Company, Inc., a California Corp.
By
Mahesh Shah, CEO
Date:
65 of 75 3 September 2, 2014 Item # 4.2
FIGTREE
PACE
LN A4110�: -. , ,
Program Report
Revised: June 4, 2014
COMPLETE REPORT ON FILE IN THE
OFFICE OF THE CITY CLERK
Attachment G
66 of 75 September 2, 2014 Item # 4.2
RESOLUTION NO. 14-
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF POWAY, CALIFORNIA
APPROVING ASSOCIATE MEMBERSHIP BY THE
CITY OF POWAY IN THE CALIFORNIA ENTERPRISE
DEVELOPMENT AUTHORITY AND AUTHORIZING AND
DIRECTING THE EXECUTION OF AN ASSOCIATE MEMBERSHIP
AGREEMENT RELATING TO ASSOCIATE MEMBERSHIP
OF THE CITY IN THE AUTHORITY
WHEREAS, the City of Poway, California (the "City "), a municipal corporation,
duly organized and existing under the Constitution and the laws of the State of
California; and
WHEREAS, the City, upon authorization of the City 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 City 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 "Authority ") 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, the Authority is a public
entity separate and apart from the parties to the Agreement and the debts, liabilities and
obligations of the Authority will not be the debts, liabilities or obligations of the City or
the other members of the Authority; and
WHEREAS, the form of Associate Membership Agreement (the "Associate
Membership Agreement ") between the City and the Authority is attached; and
WHEREAS, the City is willing to become an Associate Member of the Authority
subject to the provisions of the Associate Membership Agreement; and
WHEREAS, the City may repeal this Resolution and terminate its Associate
Membership in the Authority, upon written notice to CEDA, should it be determined at
any time that it no longer desires to continue as an Associate Member of the Authority.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Poway
as follows:
Section 1: The City Council hereby specifically finds and declares that the
actions authorized hereby constitute public affairs of the City. The City Council further
Attachment H
67 of 75 September 2, 2014 Item # 4.2
Resolution No. 14 -xx
Page 2
finds that the statements, findings and determinations of the City 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 City Clerk is hereby approved. The Mayor of the City, the City
Manager, the City Clerk and other officials of the City are each hereby authorized and
directed, for and on behalf of the City, 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 City 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.
PASSED, ADOPTED AND APPROVED by the City Council of the City of Poway
at a regular meeting this 2nd day of September, 2014.
Don Higginson, Mayor
ATTEST:
Sheila R. Cobian, CMC, City Clerk
68 of 75 September 2, 2014 Item # 4.2
STATE OF CALIFORNIA )
) SS
COUNTY OF SAN DIEGO )
I, Sheila R. Cobian, CIVIC, City Clerk, of the
penalty of perjury that the foregoing Resolution
Council at a meeting of said City Council held
that it was so adopted by the following vote:
AYES:
NOES:
ABSENT:
DISQUALIFIED:
Resolution No. 14 -xx
Page 3
City of Poway, do hereby certify under
No. 14 - * ** was duly adopted by the City
on the 2nd day of September, 2014, and
Sheila R. Cobian, CIVIC, City Clerk
City of Poway
69 of 75 September 2, 2014 Item # 4.2
ASSOCIATE MEMBERSHIP AGREEMENT
by and between the
CALIFORNIA ENTERPRISE DEVELOPMENT AUTHORITY
and the
CITY OF POWAY, CALIFORNIA
THIS ASSOCIATE MEMBERSHIP AGREEMENT (this "Associate Membership
Agreement "), dated as of September 3, 2014 by and between CALIFORNIA
ENTERPRISE DEVELOPMENT AUTHORITY (the "Authority ") and the CITY OF
POWAY, CALIFORNIA, a municipal corporation, duly organized and existing under the
laws of the State of California (the "City ");
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 City desires to become an Associate Member of the Authority;
and
WHEREAS, City Council of the City 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 City
should become an Associate Member of the Authority; and
WHEREAS, the City may terminate this Associate Membership Agreement in the
manner required by the Agreement or, if no such manner is prescribed in the
Agreement, upon written notice to CEDA, should it be determined at any time that it no
longer desires to continue as an Associate Member of the Authority.
NOW, THEREFORE, in consideration of the above premises and of the mutual
promises herein contained, the Authority and the City do hereby agree as follows:
Attachment 1
4833 - 7301 - 9141.1 1
70 of 75 September 2, 2014 Item # 4.2
Section 1. Associate Member Status. The City 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 City and the Authority, the City shall be and remain an Associate Member of the
Authority.
Section 2. Restrictions and Rights of Associate Members. The City 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 City shall have any right to become an officer or
director of the Authority by virtue of the City being an Associate Member of the
Authority.
Section 3. Effect of Prior Authority Actions. The City 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. Subsequent Amendments. City hereby agrees that any subsequent
amendments of the Authority JPA shall be binding upon the City provided, however, that
it shall not be bound by any amendments that create any financial obligations on the
part of the City and further provided, however, that before any amendment becomes
effective as to the City it shall have not less than sixty (60) days after the effective date
of the amendment to take such action to terminate its Associate Membership of the
Authority, without cost or penalty.
Section 5. No Obligations of Associate Members. The debts, liabilities and
obligations of the Authority shall not be the debts, liabilities and obligations of the City.
Section 6. 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 City in
all programs and other undertakings of the Authority.
IN WITNESS WHEREOF, the parties hereto have caused this Associate
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
Bv:
Gurbax Sahota, Chair
Board of Directors
4833 - 7301 - 9141.1 2
71 of 75 September 2, 2014 Item # 4.2
Attest:
Michelle Stephens, Asst. Secretary
CITY OF POWAY, CALIFORNIA
M
Attest:
Sheila R. Cobian, CIVIC, City Clerk
City of Poway
Don Higginson, Mayor
4833 - 7301 - 9141.1 3
72 of 75 September 2, 2014 Item # 4.2
Indemnification Agreement
Between
Renewable Funding LLC and the City of Poway
This Indemnification Agreement (Agreement) is entered into effective as of September
3, 2014 by and between the City of Poway (City), a municipality, and Renewable
Funding, LLC, (Renewable Funding) a California limited liability company, the
administrator of the CaliforniaFIRST program, which is a program of the California
Statewide Communities Development Authority ( CSCDA) in connection with the
formation, operation, financing and administration of the CaliforniaFIRST Program in the
City by CSCDA and Renewable Funding as the administrator.
WHEREAS, CSCDA is a joint exercise of powers authority the members of which
include numerous cities and counties in the state of California; and
WHEREAS, CSCDA established the CaliforniaFIRST program to allow the financing of
certain renewable energy, energy efficiency and water efficiency improvements that are
permanently affixed to real property through the levy of assessments pursuant to
Chapter 29 of Division 7 of the Streets and Highways Code and the issuance of
improvement bonds under the Improvement Bond Act of 1915 upon the security of the
unpaid assessments; and
WHEREAS, CSCDA has conducted proceedings required by Chapter 29 with respect to
the territory within the boundaries of the City and the county of San Diego; and
WHEREAS, on January 5, 2010 the City Council adopted a resolution authorizing the
City to join the CaliforniaFIRST program, authorizing CSCDA to accept applications
from eligible property owners, conduct assessment proceedings and levy assessment
within the territory of the City and authorizing related actions; and
WHEREAS, CSCDA is solely responsible for the formation, operation and
administration of the CaliforniaFIRST program as well as the sale and issuance of any
bonds in connection therewith, including the conduct of assessment proceedings, the
levy and collection of assessments and any remedial action in the case of such
assessment payments, and the offer, sale and administration of any bonds issued by
the CaliforniaFIRST program, and, although no liabilities are known exist, to protect the
City from any alleged liabilities in connection with the CaliforniaFIRST program, CSCDA
has agreed to indemnify, defend and hold the City harmless in connection therewith;
and
WHEREAS, Renewable Funding is the administrator of the CaliforniaFIRST program
and agrees to indemnify the City and provide insurance and add the City as an
additional insured on its insurance policy or policies in connection with the operations of
the CaliforniaFIRST program as set forth herein.
Attachment J
1
73 of 75 September 2, 2014 Item # 4.2
NOW, THEREFORE, in consideration of the above premises and of the City's
agreement to join the CaliforniaFIRST program, the parties agree as follows:
1. Agreement to Indemnify. Renewable Funding agrees to defend, indemnify and
hold harmless the City, its officers, elected or appointed officials, employees,
agents and volunteers from and against any and all claims, damages, losses,
expenses, fines, penalties, judgments, demands and defense costs (including,
without limitation, actual, direct, out -of- pocket costs and expenses and amounts
paid in compromise or settlement and reasonable outside legal fees arising from
litigation of every nature or liability of any kind or nature including civil, criminal,
administrative or investigative) arising out of or in connection with the
CaliforniaFIRST program except such loss or damage which was caused by the
sole negligence or willful misconduct of the City. Renewable Funding will conduct
all defenses at its sole cost and expense and the City shall reasonably approve
selection of Renewable Funding's counsel. This indemnity shall apply to all
claims and liability regardless of whether any insurance policies of Renewable
Funding, its affiliates or any other parties are applicable thereto. The policy limits
of any insurance of Renewable Funding, its affiliates or other parties are not a
limitation upon the amount of indemnification to be provided by Renewable
Funding.
2. Insurance. Renewable Funding agrees that at all times during the operation of
the CaliforniaFirst program it shall endorse its insurance policy or policies to
include as an insured the City of Poway and its elected officials, officers,
employees, agents and representatives and shall maintain insurance coverage
for the CaliforniaFIRST Program as follows: (i) commercial general liability
insurance with minimum limits of $1 million per accident for bodily injury and
property damage; (ii) workers' compensation and employer's liability insurance, if
applicable, and all other insurance required by law in the jurisdiction in which the
Work will be performed (as Work is defined in the CaliforniaFIRST program); (iii)
professional errors and omissions insurance in an amount not less than $1
million for any single event, and (iv) automobile liability insurance covering
Renewable Funding's use of automobiles, with minimum limits of $1 million per
accident for bodily injury and property damage.
3. Amendment of this Agreement. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both of the parties
hereto. No waiver of any of the provisions of this Agreement shall be binding
unless in the form of a writing signed by the party against whom enforcement is
sought, and no such waiver shall operate as a waiver of any other provisions
hereof (whether or not similar), nor shall such waiver constitute a continuing
waiver. Except as specifically provided herein, no failure to exercise or any delay
in exercising any right or remedy hereunder shall constitute a waiver thereof.
4. Severability, Governing Law, Attorneys Fees. If any provision or portion thereof
of this Agreement shall be held by a court of competent jurisdiction to be invalid,
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void, or otherwise unenforceable, the remaining provisions shall remain
enforceable to the fullest extent permitted by law. This Agreement shall be
governed by and construed and enforced in accordance with the laws of the state
of California applicable to contracts made and to be performed in California. In
the event a suit or action is brought to enforce the terms of this Agreement, it is
agreed that the prevailing party shall be entitled to reasonable attorney's fees
fixed by the court.
5. Notices, Counterparts. All notices, demands and other communications required
or permitted hereunder shall be made in writing and shall be deemed to have
been duly given if delivered by hand, against receipt, or mailed certified or
registered mail and addressed to Renewable Funding at 500 12th, Suite 300,
Oakland, CA 94607, and to the City at 14467 Lake Poway Road, Poway, CA
92064 c/o Director of Public Works. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original, which
together shall constitute the same instrument.
IN WITNESS HEREOF, the parties hereto duly executed this Agreement as of
the date above.
Renewable Funding LLC
By:
Title:
City of Poway
By:
Don Higginson, Mayor
HEREBY APPROVE the form of the foregoing Agreement this day of
2014.
By:
Morgan L. Foley, City Attorney
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