SCS HB 227(L&C) am S: "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) am S 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. If a first or second class borough has a population of less than 20,000 or 25 more than 75,000, the commission membership shall be apportioned so that the 26 number of members from home rule and first class cities reflects the proportion 27 of borough population residing in home rule and first class cities located in the 28 borough. 29 * Sec. 6. AS 29.55.100(a) is amended to read: 30 (a) A municipality may establish an energy and resilience improvement 31 assessment program under AS 29.55.100 - 29.55.165 to finance the construction,
01 installation, or modification of permanent improvements that are [(1)] fixed to new 02 construction or existing privately owned commercial or industrial property [;] and 03 that 04 (1) are energy improvement projects designed [(2) INTENDED] to 05 reduce energy consumption or demand, energy costs, or emissions affecting local air 06 quality, including a product, device, or interacting group of products or devices that 07 use energy technology to generate electricity, provide thermal energy, or regulate 08 temperature; or 09 (2) improve building resilience; resilience improvement projects 10 include projects for seismic improvements, stormwater management, flood 11 mitigation and protection, fire hardening, fire or wind resistance, erosion 12 management, snow load management, microgrids for energy storage and backup 13 power generation, water or wastewater efficiency including reuse and energy 14 recovery, electric vehicle charging stations, retrofitting that improves the 15 envelope, structure, or systems of the building, and any other improvement 16 project approved by a municipality as a resilience improvement project. 17 * Sec. 7. AS 29.55.100(b) is amended to read: 18 (b) To establish a program under AS 29.55.100 - 29.55.165, the governing 19 body of a municipality shall take the following actions in the following order: 20 (1) adopt a resolution of intent that includes 21 (A) a finding that financing energy and resilience 22 improvement projects through assessments serves a valid public purpose; 23 (B) a statement that the municipality intends to allow privately 24 owned commercial or industrial property owners to make assessments to repay 25 financing for energy and resilience improvement projects; 26 (C) a description of energy and resilience improvement 27 projects that may be subject to assessments; 28 (D) a description of the boundaries of a region within the 29 municipality's boundaries in which the program is available; 30 (E) a description of any proposed arrangements to make third- 31 party financing available or any financing the municipality will provide for
01 energy and resilience improvement projects; and 02 (F) a description of municipal debt servicing procedures for 03 any third-party financing and assessments; 04 (2) prepare the report required under AS 29.55.110 and provide notice 05 of the report with the 06 (A) location where the report is available for public inspection; 07 (B) time and place for a public hearing on the proposed 08 program; and 09 (C) name of the local official who administers the program and 10 the appropriate assessor or person who collects the proposed assessments with 11 property taxes imposed on the assessed property; 12 (3) hold a public hearing at which the public may comment on the 13 proposed program and the report prepared under AS 29.55.110; and 14 (4) adopt an ordinance establishing the program and the terms of the 15 program, including each item included in the report required under AS 29.55.110, 16 which may be incorporated by reference. 17 * Sec. 8. AS 29.55.100(d) is amended to read: 18 (d) A municipality may impose fees to offset the costs of administering a 19 program. The fees authorized under this subsection may be imposed [ASSESSED] as 20 a 21 (1) program application fee paid by the property owner applying to the 22 program; 23 (2) servicing fee included in [COMPONENT OF THE INTEREST 24 RATE ON] the assessment in the written contract between the municipality and the 25 property owner; or 26 (3) combination of (1) and (2) of this subsection. 27 * Sec. 9. AS 29.55.105(a) is amended to read: 28 (a) A municipality that establishes a program under AS 29.55.100 may 29 (1) enter into a written contract with a record owner of privately owned 30 commercial or industrial property in a region designated under AS 29.55.100 to 31 impose an assessment to repay the financing of an energy or resilience improvement
01 project on that property; 02 (2) contract with the governing body of another taxing unit to perform 03 the duties of the municipality relating to collection of assessments imposed by the 04 municipality under this section. 05 * Sec. 10. AS 29.55.105(c) is amended to read: 06 (c) An assessment under this section may repay financing for costs of an 07 energy or resilience improvement project, including 08 (1) the cost of materials and labor necessary for the energy or 09 resilience improvement project; 10 (2) permit fees; 11 (3) inspection fees; 12 (4) lender's fees; 13 (5) program application and administrative fees; 14 (6) energy or resilience improvement project development and 15 engineering fees; 16 (7) third-party review fees, including verification review fees, under 17 AS 29.55.120; [AND] 18 (8) capitalized interest; 19 (9) interest reserves; 20 (10) escrow for prepaid property tax or insurance; 21 (11) capitalized extended manufacturer's warranty or 22 maintenance agreement costs during the period of assessment; and 23 (12) any other fees or costs that may be incurred by the property owner 24 incident to the installation, modification, or improvement on a specific or pro rata 25 basis, as determined by the municipality. 26 * Sec. 11. AS 29.55.105(f) is amended to read: 27 (f) A municipality may not impose a period of assessment under this section 28 on privately owned commercial or industrial property that exceeds 30 [20] years or the 29 useful life of the project that is the basis for the assessment [, WHICHEVER IS 30 SHORTER]. 31 * Sec. 12. AS 29.55.105(g) is amended to read:
01 (g) The [EXCEPT AS OTHERWISE PROVIDED IN (h) OF THIS 02 SECTION, THE] total financing for costs of an energy or resilience improvement 03 project [REPAID BY ASSESSMENTS 04 (1)] may not exceed 25 [20] percent of the market [ASSESSED] value 05 of the property at the time of program application or completion of the proposed 06 energy or resilience improvement project [; 07 (2) MUST BE EXCEEDED BY THE PROJECTED MONETARY 08 SAVINGS TO THE PROPERTY OWNER OVER THE LIFE OF THE 09 ASSESSMENT AS A RESULT OF THE ENERGY IMPROVEMENT PROJECT]. 10 * Sec. 13. AS 29.55.105 is amended by adding a new subsection to read: 11 (i) An assessment under this section may repay financing for costs of a 12 proposed energy or resilience improvement project or an energy or resilience 13 improvement project completed within the past two years. 14 * Sec. 14. AS 29.55.110(a) is amended to read: 15 (a) The municipality shall prepare a report for a proposed program required by 16 AS 29.55.100 that includes 17 (1) a map showing the boundaries of each proposed region within 18 which the program is available; 19 (2) a form for a contract between the municipality and a property 20 owner specifying the terms of 21 (A) assessment under the program; and 22 (B) financing provided by a third party or the municipality, as 23 appropriate; 24 (3) if the proposed program provides for third-party financing, a form 25 for a contract between the municipality and the third party regarding the servicing of 26 the debt through assessments; 27 (4) a description of energy and resilience improvement projects that 28 may qualify for assessments; 29 (5) a plan for ensuring sufficient capital for third-party financing and, 30 if appropriate, raising capital for municipal financing for energy and resilience 31 improvement projects;
01 (6) if bonds will be issued to provide capital to finance energy and 02 resilience improvement projects as part of the program as provided by AS 29.55.140, 03 (A) a maximum aggregate annual dollar amount for municipal 04 financing repaid by assessments under the program; 05 (B) if requests appear likely to exceed the authorization 06 amount, a priority order for ranking a property owner's application for 07 financing repaid by assessments; and 08 (C) a formula for calculating 09 (i) the interest rate and period during which contracting 10 owners would pay an assessment; and 11 (ii) the maximum amount of an assessment; 12 (7) a method to calculate a period of assessment consistent with 13 AS 29.55.105(f); 14 (8) a description of the application process and eligibility requirements 15 for financing repaid by assessments under the program; 16 (9) a method for a property owner applying to participate in the 17 program to demonstrate the property owner's ability to fulfill financial obligations and 18 pay assessments; the method must be based on appropriate underwriting factors, 19 including 20 (A) verification that the property owner 21 (i) is the legal owner of the benefited property; 22 (ii) is current on mortgage and property tax payments; 23 and 24 (iii) is not insolvent or in bankruptcy proceedings; and 25 (B) an appropriate ratio between the amount of the assessment 26 and the market [ASSESSED] value of the property; 27 (10) an explanation of the manner in which the municipality shall 28 assess the property and collect assessments; 29 (11) the lender notice requirement under AS 29.55.115; 30 (12) the review requirement under AS 29.55.120; 31 (13) a description of marketing and participant education services
01 provided by the municipality for the program; 02 (14) a description of quality assurance and antifraud measures 03 instituted by the municipality for the program and the consequence or penalty 04 prescribed by the municipality for a property owner who participates in the program 05 but does not complete an energy or resilience improvement project as proposed; and 06 (15) a description of the insurance requirements, including a 07 requirement that the property owner have insurance against damage to the energy or 08 resilience improvement project for the life of the assessment. 09 * Sec. 15. AS 29.55.115 is amended to read: 10 Sec. 29.55.115. Notice to mortgage holder required for participation. 11 Before a municipality may enter into a written contract with a record owner of 12 property to impose an assessment to repay the financing of an energy or resilience 13 improvement project under AS 29.55.100, the property owner shall 14 (1) give each holder of a mortgage lien on the property at least 30 15 days' [DAYS"] written notice of the intention of the property owner to participate in a 16 program under AS 29.55.100; and 17 (2) obtain [A] written consent from each holder of a mortgage lien on 18 the property. 19 * Sec. 16. AS 29.55.120 is amended to read: 20 Sec. 29.55.120. Review required. The record owner of property on which an 21 assessment is imposed under AS 29.55.105 shall obtain [FROM AN INDEPENDENT, 22 THIRD-PARTY QUALIFIED ENERGY AUDITOR THE FOLLOWING:] 23 (1) for each proposed energy or resilience improvement project, 24 (A) a review of the energy, [OR] emissions, or resilience 25 baseline conditions, as appropriate; and 26 (B) the projected reduction in energy costs, energy 27 consumption or demand, or emissions affecting local air quality, or increase in 28 resilience, as appropriate; and 29 (2) for each completed energy or resilience improvement project, 30 verification that the energy or resilience improvement project was properly completed 31 and is operating as intended.
01 * Sec. 17. AS 29.55.125 is amended to read: 02 Sec. 29.55.125. Direct acquisition by owner. The proposed arrangements for 03 financing an energy or resilience improvement project may authorize the property 04 owner to 05 (1) purchase directly the related equipment and materials for the 06 energy or resilience improvement project; and 07 (2) contract directly, including through lease, a power purchase 08 agreement, or other service contract, for the energy or resilience improvement project. 09 * Sec. 18. AS 29.55.135(b) is amended to read: 10 (b) Assessment liens run with the land, and that portion of the assessment 11 under the assessment contract that has not yet become due is not eliminated by 12 foreclosure of a property tax lien or a lien for an assessment. 13 * Sec. 19. AS 29.55.140(a) is amended to read: 14 (a) A municipality may issue bonds or notes to finance energy and resilience 15 improvement projects subject to assessment under AS 29.55.105. 16 * Sec. 20. AS 29.55.140(d) is amended to read: 17 (d) Bonds or notes issued under this section must further one or more of the 18 following essential public and governmental purposes: 19 (1) improvement of the reliability of local electrical systems; 20 (2) reduction of energy costs; 21 (3) reduction of energy demand on local utilities; 22 (4) reduction of emissions affecting local air quality; 23 (5) economic stimulation and development; 24 (6) enhancement of property values; 25 (7) enhancement of employment opportunities; 26 (8) improvement of building resilience. 27 * Sec. 21. AS 29.55.150 is amended to read: 28 Sec. 29.55.150. Prohibited acts. A municipality that establishes a region under 29 AS 29.55.100 may not make the issuance of a permit, license, or other authorization 30 from the municipality to a person who owns property in the region contingent on the 31 person entering into a written contract to repay the financing of an energy or
01 resilience improvement project through assessments under AS 29.55.105, or 02 otherwise compel a person who owns property in the region to enter into a written 03 contract to repay the financing of an energy or resilience improvement project 04 through assessments under AS 29.55.105. 05 * Sec. 22. AS 29.55.160 is amended by adding a new paragraph to read: 06 (3) "finance" and "financing" include refinancing an existing project. 07 * Sec. 23. AS 29.55.165 is amended to read: 08 Sec. 29.55.165. Short title. AS 29.55.100 - 29.55.165 may be cited as the 09 Municipal Property Assessed Clean Energy and Resilience Act. 10 * Sec. 24. AS 29.55.105(d)(1) and 29.55.105(h) are repealed. 11 * Sec. 25. This Act takes effect immediately under AS 01.10.070(c).