MOUNT VERNON – City Council has begun considering a loan program that would help make more commercial buildings energy efficient at no cost or risk to the city.
Sam Filkins, vice president of the Knox Area Development Foundation, presented the PACE (Property Assessed Clean Energy) legislation and energy special improvement district at the council’s Sept. 12 meeting.
He called it another arrow in the quiver for the community to help draw more commercial activity in Mount Vernon.
“It costs zero money for taxpayers and zero money to the city,” Filkins said.
The proposal must come before the council because property owners who take on the loans will pay them off through additional property assessments. When they pay their taxes, they also will be paying down the loans.
“This is, in short, a way for property owners to get loans for themselves to pay for improvements to their buildings that are going to [reduce] … energy costs. That's typically windows, HVAC, electrical work, insulation, roof, electrical upgrades, water upgrades, anything that reduces the energy costs,” Filkins said.
He said the loan is against the building and not the owner.
The applicant seeking a PACE loan must find financing from a financial institution just like shopping for a mortgage, he said.
The city would appoint one member to a board overseeing the program. Applicants would submit their applications for review. If the board authorized participation, the applicant would need to ask the auditor to add the assessment to their property taxes for loan repayment.
“We're obviously considering the [previous] Mount Vernon News building, but you can think of other projects that would be able to use this too,” Filkins said.
The admin building is a great example as all of the windows with asbestos would need to be replaced, which would be a large cost.
“Do you think there'll be any – if not in Mount Vernon, at least in Knox County – banks that will start giving out these loans rather than having to go outside?” Councilmember Tammy Woods asked.
Filkins said he’s not aware of any bank in the county that offers this type of loan. But he hopes once the program exists some would see it as an opportunity to capture some of that business.
Councilmember John Francis asked if any of the homes that have been converted into multiple rental units qualify for the loan program.
Law Director Rob Broeren said any that have four or more units fall under state regulation, so many conversions have been kept below that as those regulations would probably require many other costly updates.
Councilmember Janis Seavolt requested another committee meeting for more discussion on the program.
Woods questions why projects city can’t afford are proposed
Councilmember Tammy Woods asked why projects are brought before City Council that the city can’t afford. During Monday’s meeting, the Mansfield Avenue waterline and drainage project and the Stump/Northview Residential Public Improvement Project were both deemed as costing more than the city’s budget can fund.
“I'm a little taken aback that things are proposed on the same agenda that are on it are saying there's no way we can currently afford this,” she said.
The Mansfield Avenue project would require a $500,000 zero-percent-interest loan, a $75,000 grant and a $37,000 match from the city. The Stump/Northview project would be a $1.3 million project with approximately $500,000 for water and another $600,000 for stormwater, plus associated road improvements.
Woods asked her fellow council members to view the recording of the last Utilities Commission meeting to get a better understanding of the projects to help them at the next Utilities Committee meeting.
