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California passed AB 811 in September 2008, giving all California cities and counties the ability to offer low-interest loans for renewable energy projects to homeowners and small businesses. The cities are able to finance the installation costs through either City internal funds or the issuance of a bond and the project is secured through a property lien. The cost of the bond is then recouped over a specific time from and repayment is made through tax rolls. For example, in the City of Palm Desert, AB811 offers a low interest rate loan (so far at 7% amortized over 20 years) from the City attached to your property that resides within that city’s limits and to be paid every six months along with your County property tax payment.
Some of the advantages to AB811 are:
• Transferability - Residents would pay back the loans through assessments on property tax bills; if they move, the outstanding loan balance is taken over by the new owner.
• Little to No Out of Pocket Money - The renewable energy property owner immediately enjoys a greatly reduced electric bill with no out-of-pocket expense.
• Access to Capital - It requires NO credit check and can pass to new owners of property without future credit checks through title transfer at escrow. Loans have a minimum of $5,000 and no maximum limits.
• Small Payments Over Longer Time - The interest rate is fixed and paid bi-annually through property taxes.
California cities currently offering this financial vehicle are:
- Berkeley - Financing Initiative for Renewable and Solar Technology (FIRST)
- Palm Desert - Energy Independence Program
- Santa Monica - Solar Santa Monica
- Sonoma County - Energy Independence Program
For more information on how you can access AB 811, contact us at info@djhconstruction.com. You can read regular company updates and solar industry news on our Solar Blog at: www.djhconstructioninc.blogspot.com/
