Gov. Bruce Rauner signed the Property Assessed Clean Energy Act (PACE) on Friday, providing property owners an innovative new way to help integrate energy-efficient upgrades into their commercial or industrial properties.
The PACE Act was a key effort of Illinois REALTORS® in the 2017 legislative session, and had passed the Illinois House and Senate with significant support.
The PACE Act allows a city or county to establish a clean energy program and create a PACE area by entering into a voluntary assessment contract with the property owner to finance or refinance energy projects. The repayment of the costs of the energy project are through assessments on the property.
Key safeguards are included in the bill, including:
- There is a requirement that there be written consent of the existing mortgage holder,
- Contractors agree to adhere to terms and conditions established by the unit of local government,
- The property cannot have any delinquencies,
- The owner must be current on all mortgage debt, and
- The amount of the assessment in relation to the greater of the assessed value of the property or the appraised value cannot exceed 25 percent.
The act is limited to commercial or industrial properties. It does not apply to single-family homes.