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File Number: 16-252 <br />1.Adopt and authorize execution of the attached resolutions and agreements consenting <br />to: <br />a.join the Western Riverside Council of Governments (WRCOG), a joint powers <br />authority, as an associate member and participate in the California HERO PACE <br />program; <br />b.join the California Enterprise Development Authority (CEDA), a joint powers <br />authority, as an associate member and participate in the Figtree PACE program; <br />c.join the California Home Finance Authority (CHFA)/Golden State Finance <br />Authority(GSFA), a joint powers authority, as an associate member and <br />participate in the Ygrene 555 and Ygrene 811 PACE Programs (two separate <br />resolutions); and <br />d.participate in the OPEN PACE program with the California State Community <br />Development Authority. <br />2.Authorize the City Manager to approve and sign the acknowledgement addendums of <br />the Regional Collaborative Services Agreement, as executed between ABAG and <br />Residential PACE Providers for each of the PACE providers listed above. <br />BACKGROUND <br />PACE financing is a relatively new model. Two pieces of legislation enable PACE programs in <br />California and several additional laws clarify and expand this legislation: <br />1.California AB 811 (July 21, 2008) allows renewable energy sources and energy <br />efficiency upgrades to be financed through an assessment district. California AB 474 <br />(January 1, 2010) and California SB 1340 (September 30, 2010) expanded AB 811 to <br />include water-efficiency improvements and the installation of charging stations for <br />electric vehicles. <br />2.Senate Bill (SB) 555 (October 5, 2011) amended the Mello-Roos Community Facilities <br />Act to allow for the creation of Community Facilities Districts (“CFDs”) for the purpose <br />of financing or refinancing the acquisition, installation, and improvement of energy <br />efficiency, water conservation, renewable energy and electric vehicle charging <br />infrastructure. Individual properties can be annexed into the district and be subject to <br />the special tax that is imposed to repay project financing if the City Council adopts a <br />resolution consenting to the inclusion of parcels in the incorporated areas of the City <br />within the CFD and each participating owner provides its unanimous written approval <br />for annexation of its property into the PACE CFD. <br />In July 2010, the Federal Housing Finance Agency (FHFA), along with Fannie Mae and <br />Freddie Mac, objected to the first priority lien status of residential PACE financing and <br />announced they would not purchase mortgages for homes with PACE obligations due to <br />concerns that PACE loans would be paid first in case of foreclosure. This announcement <br />slowed the residential PACE market for several years. In response, in 2013 Governor Brown <br />signed SB 96, which created a $10 million PACE Loan Loss Reserve to keep mortgage <br />lenders whole during a foreclosure or a forced sale of a property with a PACE assessment. <br />While the FHFA has not changed its position, the California PACE market grew rapidly with <br />the assurance of the State reserve. <br />Page 2 City of San Leandro Printed on 6/1/2016