SCS HB 227(L&C): "An Act relating to municipal energy and resilience improvement assessment programs; relating to the planning commission membership apportionment requirement for first and second class boroughs; and providing for an effective date."
00 SENATE CS FOR HOUSE BILL NO. 227(L&C) 01 "An Act relating to municipal energy and resilience improvement assessment programs; 02 relating to the planning commission membership apportionment requirement for first 03 and second class boroughs; and providing for an effective date." 04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 05 * Section 1. AS 29.10.200(64) is amended to read: 06 (64) AS 29.55.100 - 29.55.165 (energy and resilience improvement 07 assessment programs); 08 * Sec. 2. AS 29.35.200(b) is amended to read: 09 (b) A first class borough may by ordinance exercise the following powers on 10 an areawide basis: 11 (1) provide transportation systems; 12 (2) provide water pollution control; 13 (3) provide air pollution control in accordance with AS 46.14.400; 14 (4) license day care facilities;
01 (5) license, impound, and dispose of animals; 02 (6) establish an energy and resilience improvement assessment 03 program under AS 29.55.100 - 29.55.165. 04 * Sec. 3. AS 29.35.210(a) is amended to read: 05 (a) A second class borough may by ordinance exercise the following powers 06 on a nonareawide basis: 07 (1) provide transportation systems; 08 (2) regulate the offering for sale, exposure for sale, sale, use, or 09 explosion of fireworks; 10 (3) license, impound, and dispose of animals; 11 (4) subject to AS 29.35.050, provide garbage, solid waste, and septic 12 waste collection and disposal; 13 (5) provide air pollution control under AS 46.14.400; 14 (6) provide water pollution control; 15 (7) participate in federal or state loan programs for housing 16 rehabilitation and improvement for energy conservation; 17 (8) provide for economic development; 18 (9) provide for the acquisition and construction of local service roads 19 and trails under AS 19.30.111 - 19.30.251; 20 (10) establish an emergency services communications center under 21 AS 29.35.130; 22 (11) subject to AS 28.01.010, regulate the licensing and operation of 23 motor vehicles and operators; 24 (12) engage in activities authorized under AS 29.47.460; 25 (13) contain, clean up, or prevent a release or threatened release of oil 26 or a hazardous substance, and exercise a power granted to a municipality under 27 AS 46.04, AS 46.08, or AS 46.09; the borough shall exercise its authority under this 28 paragraph in a manner that is consistent with a regional master plan prepared by the 29 Department of Environmental Conservation under AS 46.04.210; 30 (14) establish an energy and resilience improvement assessment 31 program under AS 29.55.100 - 29.55.165.
01 * Sec. 4. AS 29.35.210(b) is amended to read: 02 (b) A second class borough may by ordinance exercise the following powers 03 on an areawide basis: 04 (1) provide transportation systems; 05 (2) license, impound, and dispose of animals; 06 (3) provide air pollution control under AS 46.14.400; 07 (4) provide water pollution control; 08 (5) license day care facilities; 09 (6) establish an energy and resilience improvement assessment 10 program under AS 29.55.100 - 29.55.165. 11 * Sec. 5. AS 29.40.020(a) is amended to read: 12 (a) Each first and second class borough shall establish a planning commission 13 consisting of five residents unless a greater number is required by ordinance. 14 [COMMISSION MEMBERSHIP SHALL BE APPORTIONED SO THAT THE 15 NUMBER OF MEMBERS FROM HOME RULE AND FIRST CLASS CITIES 16 REFLECTS THE PROPORTION OF BOROUGH POPULATION RESIDING IN 17 HOME RULE AND FIRST CLASS CITIES LOCATED IN THE BOROUGH.] A 18 member shall be appointed by the borough mayor for a term of three years subject to 19 confirmation by the assembly, except that a member from a home rule or first class 20 city shall be selected from a list of recommendations submitted by the council. 21 Members first appointed shall draw lots for one, two, and three year terms. 22 Appointments to fill vacancies are for the unexpired term. The compensation and 23 expenses of the planning commission and its staff are paid as directed by the 24 assembly. 25 * Sec. 6. AS 29.55.100(a) is amended to read: 26 (a) A municipality may establish an energy and resilience improvement 27 assessment program under AS 29.55.100 - 29.55.165 to finance the construction, 28 installation, or modification of permanent improvements that are [(1)] fixed to new 29 construction or existing privately owned commercial or industrial property [;] and 30 that 31 (1) are energy improvement projects designed [(2) INTENDED] to
01 reduce energy consumption or demand, energy costs, or emissions affecting local air 02 quality, including a product, device, or interacting group of products or devices that 03 use energy technology to generate electricity, provide thermal energy, or regulate 04 temperature; or 05 (2) improve building resilience; resilience improvement projects 06 include projects for seismic improvements, stormwater management, flood 07 mitigation and protection, fire hardening, fire or wind resistance, erosion 08 management, snow load management, microgrids for energy storage and backup 09 power generation, water or wastewater efficiency including reuse and energy 10 recovery, electric vehicle charging stations, retrofitting that improves the 11 envelope, structure, or systems of the building, and any other improvement 12 project approved by a municipality as a resilience improvement project. 13 * Sec. 7. AS 29.55.100(b) is amended to read: 14 (b) To establish a program under AS 29.55.100 - 29.55.165, the governing 15 body of a municipality shall take the following actions in the following order: 16 (1) adopt a resolution of intent that includes 17 (A) a finding that financing energy and resilience 18 improvement projects through assessments serves a valid public purpose; 19 (B) a statement that the municipality intends to allow privately 20 owned commercial or industrial property owners to make assessments to repay 21 financing for energy and resilience improvement projects; 22 (C) a description of energy and resilience improvement 23 projects that may be subject to assessments; 24 (D) a description of the boundaries of a region within the 25 municipality's boundaries in which the program is available; 26 (E) a description of any proposed arrangements to make third- 27 party financing available or any financing the municipality will provide for 28 energy and resilience improvement projects; and 29 (F) a description of municipal debt servicing procedures for 30 any third-party financing and assessments; 31 (2) prepare the report required under AS 29.55.110 and provide notice
01 of the report with the 02 (A) location where the report is available for public inspection; 03 (B) time and place for a public hearing on the proposed 04 program; and 05 (C) name of the local official who administers the program and 06 the appropriate assessor or person who collects the proposed assessments with 07 property taxes imposed on the assessed property; 08 (3) hold a public hearing at which the public may comment on the 09 proposed program and the report prepared under AS 29.55.110; and 10 (4) adopt an ordinance establishing the program and the terms of the 11 program, including each item included in the report required under AS 29.55.110, 12 which may be incorporated by reference. 13 * Sec. 8. AS 29.55.100(d) is amended to read: 14 (d) A municipality may impose fees to offset the costs of administering a 15 program. The fees authorized under this subsection may be imposed [ASSESSED] as 16 a 17 (1) program application fee paid by the property owner applying to the 18 program; 19 (2) servicing fee included in [COMPONENT OF THE INTEREST 20 RATE ON] the assessment in the written contract between the municipality and the 21 property owner; or 22 (3) combination of (1) and (2) of this subsection. 23 * Sec. 9. AS 29.55.105(a) is amended to read: 24 (a) A municipality that establishes a program under AS 29.55.100 may 25 (1) enter into a written contract with a record owner of privately owned 26 commercial or industrial property in a region designated under AS 29.55.100 to 27 impose an assessment to repay the financing of an energy or resilience improvement 28 project on that property; 29 (2) contract with the governing body of another taxing unit to perform 30 the duties of the municipality relating to collection of assessments imposed by the 31 municipality under this section.
01 * Sec. 10. AS 29.55.105(c) is amended to read: 02 (c) An assessment under this section may repay financing for costs of an 03 energy or resilience improvement project, including 04 (1) the cost of materials and labor necessary for the energy or 05 resilience improvement project; 06 (2) permit fees; 07 (3) inspection fees; 08 (4) lender's fees; 09 (5) program application and administrative fees; 10 (6) energy or resilience improvement project development and 11 engineering fees; 12 (7) third-party review fees, including verification review fees, under 13 AS 29.55.120; [AND] 14 (8) capitalized interest; 15 (9) interest reserves; 16 (10) escrow for prepaid property tax or insurance; 17 (11) capitalized extended manufacturer's warranty or 18 maintenance agreement costs during the period of assessment; and 19 (12) any other fees or costs that may be incurred by the property owner 20 incident to the installation, modification, or improvement on a specific or pro rata 21 basis, as determined by the municipality. 22 * Sec. 11. AS 29.55.105(f) is amended to read: 23 (f) A municipality may not impose a period of assessment under this section 24 on privately owned commercial or industrial property that exceeds 30 [20] years or the 25 useful life of the project that is the basis for the assessment [, WHICHEVER IS 26 SHORTER]. 27 * Sec. 12. AS 29.55.105(g) is amended to read: 28 (g) The [EXCEPT AS OTHERWISE PROVIDED IN (h) OF THIS 29 SECTION, THE] total financing for costs of an energy or resilience improvement 30 project [REPAID BY ASSESSMENTS 31 (1)] may not exceed 25 [20] percent of the market [ASSESSED] value
01 of the property at the time of program application or completion of the proposed 02 energy or resilience improvement project [; 03 (2) MUST BE EXCEEDED BY THE PROJECTED MONETARY 04 SAVINGS TO THE PROPERTY OWNER OVER THE LIFE OF THE 05 ASSESSMENT AS A RESULT OF THE ENERGY IMPROVEMENT PROJECT]. 06 * Sec. 13. AS 29.55.105 is amended by adding a new subsection to read: 07 (i) An assessment under this section may repay financing for costs of a 08 proposed energy or resilience improvement project or an energy or resilience 09 improvement project completed within the past two years. 10 * Sec. 14. AS 29.55.110(a) is amended to read: 11 (a) The municipality shall prepare a report for a proposed program required by 12 AS 29.55.100 that includes 13 (1) a map showing the boundaries of each proposed region within 14 which the program is available; 15 (2) a form for a contract between the municipality and a property 16 owner specifying the terms of 17 (A) assessment under the program; and 18 (B) financing provided by a third party or the municipality, as 19 appropriate; 20 (3) if the proposed program provides for third-party financing, a form 21 for a contract between the municipality and the third party regarding the servicing of 22 the debt through assessments; 23 (4) a description of energy and resilience improvement projects that 24 may qualify for assessments; 25 (5) a plan for ensuring sufficient capital for third-party financing and, 26 if appropriate, raising capital for municipal financing for energy and resilience 27 improvement projects; 28 (6) if bonds will be issued to provide capital to finance energy and 29 resilience improvement projects as part of the program as provided by AS 29.55.140, 30 (A) a maximum aggregate annual dollar amount for municipal 31 financing repaid by assessments under the program;
01 (B) if requests appear likely to exceed the authorization 02 amount, a priority order for ranking a property owner's application for 03 financing repaid by assessments; and 04 (C) a formula for calculating 05 (i) the interest rate and period during which contracting 06 owners would pay an assessment; and 07 (ii) the maximum amount of an assessment; 08 (7) a method to calculate a period of assessment consistent with 09 AS 29.55.105(f); 10 (8) a description of the application process and eligibility requirements 11 for financing repaid by assessments under the program; 12 (9) a method for a property owner applying to participate in the 13 program to demonstrate the property owner's ability to fulfill financial obligations and 14 pay assessments; the method must be based on appropriate underwriting factors, 15 including 16 (A) verification that the property owner 17 (i) is the legal owner of the benefited property; 18 (ii) is current on mortgage and property tax payments; 19 and 20 (iii) is not insolvent or in bankruptcy proceedings; and 21 (B) an appropriate ratio between the amount of the assessment 22 and the market [ASSESSED] value of the property; 23 (10) an explanation of the manner in which the municipality shall 24 assess the property and collect assessments; 25 (11) the lender notice requirement under AS 29.55.115; 26 (12) the review requirement under AS 29.55.120; 27 (13) a description of marketing and participant education services 28 provided by the municipality for the program; 29 (14) a description of quality assurance and antifraud measures 30 instituted by the municipality for the program and the consequence or penalty 31 prescribed by the municipality for a property owner who participates in the program
01 but does not complete an energy or resilience improvement project as proposed; and 02 (15) a description of the insurance requirements, including a 03 requirement that the property owner have insurance against damage to the energy or 04 resilience improvement project for the life of the assessment. 05 * Sec. 15. AS 29.55.115 is amended to read: 06 Sec. 29.55.115. Notice to mortgage holder required for participation. 07 Before a municipality may enter into a written contract with a record owner of 08 property to impose an assessment to repay the financing of an energy or resilience 09 improvement project under AS 29.55.100, the property owner shall 10 (1) give each holder of a mortgage lien on the property at least 30 11 days' [DAYS"] written notice of the intention of the property owner to participate in a 12 program under AS 29.55.100; and 13 (2) obtain [A] written consent from each holder of a mortgage lien on 14 the property. 15 * Sec. 16. AS 29.55.120 is amended to read: 16 Sec. 29.55.120. Review required. The record owner of property on which an 17 assessment is imposed under AS 29.55.105 shall obtain [FROM AN INDEPENDENT, 18 THIRD-PARTY QUALIFIED ENERGY AUDITOR THE FOLLOWING:] 19 (1) for each proposed energy or resilience improvement project, 20 (A) a review of the energy, [OR] emissions, or resilience 21 baseline conditions, as appropriate; and 22 (B) the projected reduction in energy costs, energy 23 consumption or demand, or emissions affecting local air quality, or increase in 24 resilience, as appropriate; and 25 (2) for each completed energy or resilience improvement project, 26 verification that the energy or resilience improvement project was properly completed 27 and is operating as intended. 28 * Sec. 17. AS 29.55.125 is amended to read: 29 Sec. 29.55.125. Direct acquisition by owner. The proposed arrangements for 30 financing an energy or resilience improvement project may authorize the property 31 owner to
01 (1) purchase directly the related equipment and materials for the 02 energy or resilience improvement project; and 03 (2) contract directly, including through lease, a power purchase 04 agreement, or other service contract, for the energy or resilience improvement project. 05 * Sec. 18. AS 29.55.135(b) is amended to read: 06 (b) Assessment liens run with the land, and that portion of the assessment 07 under the assessment contract that has not yet become due is not eliminated by 08 foreclosure of a property tax lien or a lien for an assessment. 09 * Sec. 19. AS 29.55.140(a) is amended to read: 10 (a) A municipality may issue bonds or notes to finance energy and resilience 11 improvement projects subject to assessment under AS 29.55.105. 12 * Sec. 20. AS 29.55.140(d) is amended to read: 13 (d) Bonds or notes issued under this section must further one or more of the 14 following essential public and governmental purposes: 15 (1) improvement of the reliability of local electrical systems; 16 (2) reduction of energy costs; 17 (3) reduction of energy demand on local utilities; 18 (4) reduction of emissions affecting local air quality; 19 (5) economic stimulation and development; 20 (6) enhancement of property values; 21 (7) enhancement of employment opportunities; 22 (8) improvement of building resilience. 23 * Sec. 21. AS 29.55.150 is amended to read: 24 Sec. 29.55.150. Prohibited acts. A municipality that establishes a region under 25 AS 29.55.100 may not make the issuance of a permit, license, or other authorization 26 from the municipality to a person who owns property in the region contingent on the 27 person entering into a written contract to repay the financing of an energy or 28 resilience improvement project through assessments under AS 29.55.105, or 29 otherwise compel a person who owns property in the region to enter into a written 30 contract to repay the financing of an energy or resilience improvement project 31 through assessments under AS 29.55.105.
01 * Sec. 22. AS 29.55.160 is amended by adding a new paragraph to read: 02 (3) "finance" and "financing" include refinancing an existing project. 03 * Sec. 23. AS 29.55.165 is amended to read: 04 Sec. 29.55.165. Short title. AS 29.55.100 - 29.55.165 may be cited as the 05 Municipal Property Assessed Clean Energy and Resilience Act. 06 * Sec. 24. AS 29.55.105(d)(1) and 29.55.105(h) are repealed. 07 * Sec. 25. This Act takes effect immediately under AS 01.10.070(c).