Under the AB 811 programs, local governments would finance the upgrades and property owners would then pay back the loan through an added charge on their annual property taxes. The loan and the payments are attached to the property, not to the property owner. This means if you were a property owner and participated in the program and one year later you sold your property, the new owner would be responsible for the rest of the loan payback. This makes sure that the responsibility for paying for the upgrades stays with the person who is receiving the benefits of better energy management.
Local governments are moving quickly to enact these programs because there is currently money available to them from federal stimulus financing. With California's financial health in dire condition, this may be an opportunity to enact AB 811 programs that local government cannot afford to pass up. The article mentions some cities may finance the programs from their own funds as the programs are expected to pay for themselves as the loans are paid back.
Front-end subsidizing of energy-retrofits and upgrades makes good sense and should be explored and pursued by state and local governments everywhere. It isn't a miracle pill and it can't work everywhere, but it is a fairly straightforward measure; easy to understand and easy to implement. Policies like these create positive situations for government, businesses, and citizens. These programs will work best when the payments added to the annual property taxes are roughly equal to or below the savings generated on the property owner's energy costs. This will probably be the most difficult portion of the program to calibrate, but it is worth the effort. These programs are winning solutions for the environment and our bottom line.
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