Green loans improve energy efficiency, local economies
For savvy homeowners ready to improve the energy efficiency of their homes but hesitant to make the investment in today’s troubled economy, HELP is on the way.
HELP, Montgomery County, Md.’s Home Energy Loan Program, is one of several low-interest loan programs initiated this year to make it easier for homeowners to invest in energy efficiency improvements in spite of the weak economy.
 While program specifics vary, the county initiatives share an innovative idea to enable county residents to fund renewable energy, energy efficiency and water efficiency upgrades to their homes or businesses through the property tax system. By tying the assessment to properties, not owners, homeowners can confidently invest in energy efficiency improvements. If a person moves, the loan stays with the house.
The recently approved HELP program will provide loans of up to $10,000 to county residents for home energy audits and renovations to make homes more energy efficient with proper insulation, tightly sealed windows and other energy-saving measures. The low-interest loans can be repaid over at least 15 years.
Montgomery County’s Department of Environmental Protection estimates that residents will start to see financial savings from their energy-efficiency improvements in seven to eight years.
In Sonoma County, Calif., green lending is already underway. Sonoma is the first county in the nation to offer green loans through the new Sonoma County Energy Independence Program (SCEIP).
The program is supported by the California Assembly Bill 811, passed last September, with the aim of increasing funding for energy efficiency. The bill makes it legal for cities and counties in California to create districts to permit property owners to “finance” installation of energy-efficient and green-power systems via payments on property tax bills.
“This program is an innovative new way for people to make energy-saving improvements to their homes and businesses,” said Valerie Brown, Sonoma County supervisor and NACo president-elect. “The improvements will add value to their properties, provide energy and cost savings throughout their lifetimes, and help the environment,” she said. “It’s a triple whammy.”
Green loans will also create more green jobs in the hard-hit construction and building trade industries. “We are trying to make this as broad and easy as possible,” said Amy Bolton, Sonoma County public information officer. “Any licensed contractor will be able to do the work.”
In Boulder County, Colo., voters approved the ClimateSmart loan program authorizing the government to provide $40 million in loans to homeowners to make energy-efficiency upgrades. The loans can be used for everything from insulation and storm windows to evaporative coolers and photovoltaic panels, and are payable through property taxes.
“We definitely see this as a boon,” said Julie Herman, executive director of the Boulder Green Building Guild. “It is an economic stimulus that will help keep local people employed, which helps keep dollars in the community.”
ClimateSmart is predicted to create up to 800 new construction sites in the county this year, putting thousands of unemployed construction workers back to work. Currently there are 17 workers for each available construction job, according to Workforce Boulder County.
By the first application deadline (April 10), 512 households applied for $9.4 million in energy efficiency loans in Boulder County. Anyone who owns their property and who hasn’t been delinquent on property taxes over the last three years will likely qualify.
“I think a lot of counties are probably watching what happens in Boulder,” said Alice Madden, the governor’s climate change coordinator and the bill’s sponsor. “It’s a wonderful program. No one should be shut out of the new energy economy.”
In New Mexico, Gov. Bill Richardson also signed a bill that will allow cities and counties to form financing districts to issue bonds for renewable energy and energy-efficiency upgrades.
Similar legislation has passed in Connecticut and California, and bills are under consideration in Montana, Oregon and Washington.
Legislation is also under review to provide federal and Recovery Act funding for energy efficiency loans. Rep. Chris Van Hollen (D-Md.) proposed the National Home Energy Savings Act in March to distribute $5 billion to local governments for the next two fiscal years to create revolving homeowner loan programs for energy upgrades through a National Home Energy Savings Revolving Fund Act.
If implemented at a national level, it could help up to one million households nationwide to make energy improvements. According to Van Hollen, “Energy efficiency helps reduce our dependence on fossil fuels, helps the environment and saves homeowners some money.”
(For more information on NACo’s Green Government Initiative please visit www.greencounties.org or contact Kelly Zonderwyk at kzonderwyk@naco.org or 202/942-4224.)
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