Senate committee substitute to the 1st edition makes the following changes.
Amends new Article 10B, titled the "Commercial Property Assessed Capital Expenditure and Resilience Act (C-PACE)," in GS Chapter 160A, as follows. Amends the C-PACE toolkit requirements under new GS 160A-239.14 so that: (1) the required form of notice of C-PACE assessment has to identify the qualified commercial property subject to the assessment, along with the property's owner's consent to that assessment; (2) the form of assignment of C-PACE lien is from the local government to the capital provider that cross-references the registry book and page number of the notice of C-PACE assessment giving rise to the lien; and (3) expands the type of lienholders that must consent to a C-PACE assessment to include those holding any other lien upon the qualifying commercial property (currently just holders of a mortgage or deed of trust). Changes references in GS 160A-239.14 from benefitted property to qualifying commercial property. Expands the property owner's required certification so that the owner must certify that they are the holder of title in fee simple (currently just have to certify that they are the legal owner of the property), in addition to certifying that title is not in dispute. Removes the requirement that a C-PACE lien must be executed before the C-PACE assessment and lien documents are recorded in the appropriate office of the registrar of deeds. Makes clarifying changes.
Expands the required contents of the local government's resolution under new GS 160A-239.15 to include a statement of the place and time for a public hearing on the proposed C-PACE program. Specifies that if a local government seeking to participate in a C-PACE program is a city, the authorizing resolution is effective only with the concurrence of the governing body of the county in which the city is located. Amends the prong of the resolution containing the government's statement that it intends to authorize C-PACE financing so that it now requires the local government to state that it intends to authorize: (1) C-PACE financing; (2) the imposition of C-PACE assessments on qualifying commercial properties benefitting from qualifying improvements to secure repayment of C-PACE financing; (3) assign the C-PACE lien to the capital provider providing C-PACE financing; and (4) delegate billing, collection, and enforcement duties for the C-PACE assessment and C-PACE lien to capital providers (was, statement must: authorize C-PACE financing, authorize the imposition of C-PACE assessments and C-PACE liens on qualifying commercial properties benefitting from qualifying improvements to secure repayment of C-PACE financing, and assign the same or the right to repayment proceeds to the capital provider providing C-PACE financing, and delegate billing, collection, and enforcement duties for the C-PACE assessment and C-PACE lien to capital provider).
Changes reference from payment of C-PACE lien to payment of C-PACE assessment in GS 160A-239.17. Now prevents the use of public funds to repay any C-PACE assessment under GS 160A-239.20 (was, prevents public funds from being used to repay any loan between a capital provider and property owner). Changes the conforming change to GS 105-375 (in rem foreclosures) to refer to liens arising from C-PACE assessments (was, just referred to the assessments).
Amends the Employee Stock Ownership Plan (ESOP) prong of the term minority business under GS 143-128.2(g) (concerning minority business participation goals) so that 51% of plan participants must be comprised of minority persons or socially and economically disadvantaged individuals (was, 51% of the ESOP stock must be owned by such persons). Makes conforming changes and further amends GS 143-128.4 (defining historically underutilized businesses for purposes of statewide uniform certifications) to require an ESOP company applying for such certification to provide an attestation that it meets the requirements of the statute along with any required supporting documentation.
Makes organizational changes and conforming changes to the act's title.
Bill Summaries: S802 C-PACE PROGRAM.
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Bill S 802 (2023-2024)Summary date: May 28 2024 - View Summary
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Bill S 802 (2023-2024)Summary date: May 6 2024 - View Summary
Enacts Article 10B, titled the "Commercial Property Assessed Capital Expenditure and Resilience Act (C-PACE)," in GS Chapter 160A. Sets forth legislative findings and 15 defined terms. Defines qualified improvement to mean a permanent improvement that is affixed to a qualified commercial property (defined) and includes one of the following characteristics approved by the administrator, as described: energy efficiency measure; resiliency measure; renewable energy measure; and/or water conservation measure. Defines capital provider to mean a private entity, or the private entity's designee, successor, and assigns, that makes or funds qualifying improvements under the Article.
Authorizes the establishment of a statewide C-PACE program that local governments can voluntarily join to allow willing owners of certain properties to obtain low-cost, long-term financing for qualifying improvements including energy efficiency, water conservation, renewable energy, and resilience projects, secured by a recorded assessment and lien pursuant to the Article. Designates the Department of Commerce (DOC) as the program’s sponsor. Authorizes the Economic Development Partnership of North Carolina (Partnership) to serve as administrator of the C-PACE program with seven listed prongs of oversight responsibility, including preparing a C-PACE toolkit in consultation with local governments and the DOC, imposing fees to offset the actual and reasonable costs of administering C-PACE which are capped at $750 for application fees and $25,000 for processing fees for financed projects, establishing a process for reviewing and evaluating applications, accepting and approving applications for C-PACE financing, recording of liens or notice of assignments pertaining to C-PACE assessments and liens, and annual reports to DOC. Exempts the C-PACE toolkit and any actions of the Partnership or DOC in the administration of the program from GS Chapter 150B of the APA (rulemaking, hearings, judicial review).
Requires local governments seeking to participate in the program to adopt a resolution with specified content including, (1) an authorization for the C-PACE program to operate within its jurisdictional boundaries, (2) its intent to participate in the program and take associated actions, and (3)statement that he amount of a C-PACE financing and related assessment repayment rems must be pursuant to the related financing agreement. Bars local government from receiving funds for repayment of C-PACE assessments and directs that if any such funds are received, they are considered custodial funds for the benefit of the capital provider.
Details procedures and requirements pertaining to State and local government immunity. Places sole enforcement responsibility upon the capital provider. Further provides for foreclosure procedure, parameters, and lien priority, with the C-PACE lien being inferior to all non-governmental liens on the property prior to the date on which the notice of the C-PACE lien was recorded, subject to mortgage holder consent. Details the effect of a C-PACE lien, deeming the lien to run with the land and be superior to all other liens from the date of recordation. Bars contesting matters regarding whether the lien is a qualified improvement, or financing procedural or substantive irregularities, following recordation of the C-PACE lien.
Provides a non-exhaustive list of permissible financing for assessments, including material and labor costs, permit fees, inspections fees, and capitalized interest. Restricts the term of financing to the weighted average useful life if multiple improvements are approved. Provides for financing negotiations and enforcement responsibilities.
Provides for prior consent of each holder of a mortgage or deed on the property securing indebtedness, required to be submitted to the Partnership, which also acknowledges that the assessment is not an event of default under the terms of the mortgage or deed. Specifies that financing arrangements can include direct purchases or contractual agreements.
Makes conforming and/or changes to GS 105-375 (in rem foreclosures) and GS 105-374 (foreclosure by tax lien).
Appropriates $50,000 from the General Fund to DOC in nonrecurring funds for the 2024-2025 fiscal year to allocate to the Economic Development Partnership of North Carolina to develop the C-PACE toolkit.
Effective July 1, 2024.