Affordable Multifamily Energy Efficiency Financing Program ... · 2/26/2019 · Affordable...

1CALIFORNIA HUB FOR ENERGY EFFICIENCY FINANCING

Affordable Multifamily Energy Efficiency Financing

Program

California Alternative Energy and Advanced Transportation Financing Authority

(CAEATFA)

Affordable Multifamily Energy Efficiency Financing Program


Closed Captioning is Available

Closed Captioning• rrcaptions.my.webex.com

• Meeting number: 621 805 779 • Meeting password: CAEATFA



We Want Your Comments and Input!

o Please provide comments during this workshop or afterwards by 5:00 PM on Friday March 8, 2019.o CAEATFA will consider all comments and incorporate them as appropriate.o Proposed regulations are available at: https://www.treasurer.ca.gov/caeatfa/cheef/multifamily.asp

Comments can be submitted to: [email protected]

Or to

Susan MillsProgram Specialist, [email protected]


https://www.treasurer.ca.gov/caeatfa/cheef/multifamily.asp

mailto:[email protected]



Gain Program Insight and Provide Feedback

Workshop Goals1. Provide program details to finance companies,

affordable multifamily owners, implementers, and other EE industry participants

2. Communicate program developmentstatus and timeframe for launch

3. Seek feedback on regulatory language

4. Outline the participation process for stakeholders



Table of ContentsExecutive Summary Page 6

Background Page 12

Program Structure Page 17• Key Concepts Page 17• Customer Eligibility Page 20 • Project and Measure Eligibility Page 23• Credit Enhancement Structure Page 31• Finance Company Eligibility and Roles Page 37• Financial Product Eligibility Page 44• Enabling a Secondary Market Page 49

Project Lifecycle Page 51

Feedback Page 54

Resources and Appendices Page 57



Executive Summary

Background

Program Structure

• Key Concepts• Customer Eligibility• Project and Measure Eligibility• Credit Enhancement Structure• Finance Company Eligibility and Roles• Financial Product Eligibility• Enabling a Secondary Market

Project Lifecycle

Feedback

Resources and Appendices



Affordable Multifamily Program Summary of Features

Eligible Customers

Deed restricted properties of 5 or

more units

50% of units reserved for

income restricted

Existing buildings retrofits

IOU service territories

Types of Projects

Energy Efficiency and Demand

Response

Flexibility to include non

energy-saving measures

Financing

Private capital

Service agreements,

savings-based payment

agreements, loans,

leases/EFAs

Credit Enhancement

No cost to finance company

or customer

15% contribution on first $1MM of

financing

Ease of Use

Streamlined options for

measure eligibility



CAEATFA Made Key Program Design Revisions Based on Public Input

Following the November 2017 workshop and stakeholder engagement: Affordable multifamily property size requirements updated – 5 or more units

instead of 20 units Energy Saving Measure (ESM) List includes HVAC, windows, central

systems. Select measures on the ESM List will be eligible for self-install Distinction between service agreements and savings-based payment

agreements clarified



Ratepayer Funded Credit-Enhancement Results in Benefits for Customers, and Larger Projects

Program provides finance companies

with credit enhancement

Finance companies offer better terms

Program Partners present CHEEF

financing options to their customers

Attractive financing allows customers to

complete deeper energy retrofits

321 4

o Lower rateso Longer terms

We expect the credit enhancement will allow finance companies to offer benefits to borrowers. Benefits might include:

o Larger finance amountso Broader approvals



Who Should Utilize this Program and Why

Finance Companies

Program Implementers

Local Government



Affordable Multifamily Program Anticipated Timeline

Regulation workshop

Public comment on regulations

due by 5:00 PM

Regulations presented to

Board

Regulations approved by

Office of Administrative

Law

Pilot Launch

2/26/2019 4/16/2019 5/15/20193/8/2019 6/20195-6/2019

Finance Entity

Enrollment



Executive Summary

Background

Program Structure


Project Lifecycle

Feedback




California Will Only Achieve Its Building Energy Reduction Goals Through Leveraging Private Capital

The California Legislature has set ambitious goals to mitigate climate change:

AB 32 2006 Requires state to reduce its GHG emissions to 1990 levels by 2020.

AB 758 2009 Recognizes the need for California to address climate change through reduced energy consumption in existing buildings (residential, commercial, and public).

AB 802 2015 Authorizes energy efficiency programs to bring existing buildings up to current code and creates a building energy use benchmarking and disclosure.

SB 350 2015 Requires doubling of the state’s energy efficiency savings by 2030.

SB 32 2016 Requires the state to reduce GHG emissions 40% below 1990 levels by 2030.

SB 100 2018 Requires 100% of retail electricity sales to be RPS-eligible or zero-carbon by 2045

$50 Billion

Needed to retrofit CA’s existing buildings*Ratepayer and taxpayer $ are insufficient

*Harcourt Brown and Carey, “Energy Efficiency Financing in California Needs and Gaps Preliminary Assessment and Recommendations.” July, 2011.



California Public Utilities Commission Authorized $75 Million Toward a Series of Statewide Financing Pilots to:

CHEEF - administered by CAEATFA, isa public-private partnership engaging lenders and contractors, designed to encourage an uptake of energy efficiency projects through increased access to financing

CAEATFA - housed in the State Treasurer’s Office, develops programs to leverage private capital to support the State’s energy and environmental policy goals.

The Investor Owned Utilities (IOUs) are CAEATFA’s partners in developing and implementing the CHEEF pilots.

Marketing ImplementerCenter for Sustainable Energy runs the Statewide marketing campaign, connecting small business owners to the Program.

1. “Develop scalable and leveraged financing products to stimulate deeper EE projects than previously achieved through traditional program approaches (e.g., audits, rebates, and information)”

2. “Test whether transitional ratepayer support for Credit Enhancements can lead to self-supporting EE finance programs in the future”



Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4

2016 2017 2018

Loan Volume Since Program Began

Residential Energy Efficiency Loan Assistance Program (REEL) Launched in the Summer of 2016 (as of February 2019)

7Approved Lenders

$17,134Average loan size

Lenders have financed more than

$6.4 MillionIn residential loans

305Participating Contractors

7.04%Average interest rate

52%Homes located in LMI Census

Tracts

372Total Enrolled LoansN

ew L

oans

Enr

olle

d Q

uart

erly



Affordable Multifamily Program is Designed to Address Barriers to EE Financing

Today’s Challenges CHEEF SolutionsAffordable MF owners lack sufficient capital

to make EE upgradesExpand access to capital and improve rates and terms.

Senior mortgage holders & tax equity investors restrict ability to take on debt.

Offer non-debt products like Energy Service Agreements

Property owners see EE investments as too much work and a low priority.

Program designed to be easy to use with Program staff assisting the customer through the process

Accessing rebates and incentives is already a time intensive process for property owners.

Leverages IOU and other affordable MF programs (LIWP, SOMAH, BayRen, SocalRen, MCE) to streamline qualification and offers single measure pathway.



Executive Summary

Background

Program Structure


Project Lifecycle

Feedback




Program Projects

Total Financed Amount (no maximum)

Claim Eligible Financed Amount • Up to $1millionMeasures eligible for credit enhancement

Claim Ineligible Financed Amount: Measures not eligible

for credit enhancement

Energy Saving Measures (ESM)

must account for at least 70% of the claim eligible financed

amount

Non-Energy Components*

may account for up to 30%

Key Concepts

* Measures that utilize or conserve fuel that is not provided by an IOU (i.e., provided by a MUNI or --------electric co-op) are considered non-energy saving measures

* Non-Energy Components include non-energy saving measures and capitalized interest



Claim-Eligible Financed Amount Can Include Legally Required Installations and Up to 30% Non-Energy Improvements

Claim Eligible Financed Amount • Up to $1 millionMeasures eligible for credit enhancement

Claim Ineligible Financed Amount

At least 70%

All Non-ESMs excluding Distributed Generation.Examples:

LandscapingNew Floors

MUNI Measures

Energy Saving Measures (ESM)Energy Efficiency, Demand Response

Legally & Practically Required

Distributed Generation

Examples: Solar PV,

CHP, storage

Additional ESMs

beyond $1MM and/or non-energy components beyond 30% of the claim

eligible financed amount

Up to 30%

Measures that are

required to complete the installation of

ESMs

Pre-Qualified ESM List

Program Partner Method

Total Financed Amount • (no maximum)

Non-Energy Components

Key Concepts



Executive Summary

Background

Program Structure


Project Lifecycle

Feedback




Eligible Customers

Customer EligibilitySee regulations §10093.1(n)&(r)

PropertyReceives gas or electricity from one of the four Investor Owned Utilities (IOUs), a Community Choice Aggregator (CCA) or Energy Service Provider (ESP)

Size 5 or more units

Occupancy Owners must not reside at property

Credit Standards No bankruptcies, judgements, or liens within last 5 years

RestrictionsSubject to a deed restriction and occupancy for at least 50% of the total units to households meeting the requirements of the income limits no greater than “moderate”



Seeking Feedback on Project and Measure Eligibility:

1. Is it reasonable to require recorded affordability deed restriction or covenant to an affordable multifamily home to have 10 years of restriction remaining?

Project and Measure Eligibility



Executive Summary

Background

Program Structure


Project Lifecycle

Feedback




Energy Saving Measures include EE and DR

Any Energy Efficiency or Demand Response Measure, as defined, including alterations and improvements that are legally or practically required to complete the installation of the energy saving measures.

Energy Saving Measure

Reductions, increases, or shifts in electricity or gas consumption by customers in response to either economic or reliability signals.

Demand ResponseAn energy using appliance, equipment, control system, or practice whose installation or implementation results in reduced grid-supplied energy use while maintaining a comparable or higher level of energy service as perceived by the customer.

Energy Efficiency

Project and Measure Eligibility See regulations §10093.5(b)(1)-(2)



Method 1: Measures on the “ESM List” are Pre-Qualified

o CAEATFA has created a list of pre-qualifiedenergy saving measures (ESM)

o Measures on the ESM list can be financedwithout any additional approval

o Some ESM list measures include eligibility requirements

o The ESM list is published by CAEATFA as part of the Commercial Regulations 4 CCR §10092.14

the measure named IOU/REN/CCA Rebate – Other does not qualify as IOU-approved measures qualify through the Program Partner pathway

see (presentation appendix)

Project and Measure Eligibility See regulations §10093.1(x)

Requested Measure Categories Included

WindowsHVAC

Building EnvelopeAppliances

LightingWater Heating



Select ESM List Measures are Eligible for Self-Install

o Self-install measures are those that are installed without the use of a licensed contractor

o Select ESM List measures have been identified by CAEATFA as self-install eligible if: The measure can be legally and safely installed without a special license

The measure’s performance is unlikely to be affected by non-professional installation

o Examples of self-install measures include: Plug-in appliances or equipment, screw-in lighting, smart thermostats, low-flow shower heads

Project and Measure Eligibility See regulations §10093.5(c)



Method 2: Program Partner

o Program Partner: An entity that administers and/or implements a State of California or IOU/REN/CCA multifamily property Energy Efficiency, Demand Response, or Distributed Generation program.

o Any measure will qualify as an ESM if it is determined to save energy through an energy audit conducted by a Program Partner, such as LIWP, SOMAH, IOU, REN, or CCA

o Customer must submit a copy of reservation letter and energy audit

Project and Measure Eligibility See regulations §10093.5(b)(2) &§10093.6(b)(1)(F)



All Projects Must Meet Basic Requirements

Contractor’s license must be applicable to the work being performed

Necessary permits have been approved – all approved permits must be submitted to CAEATFA

Measures installed in compliance with Title 24 and all other laws

ESM fuel savings (electric or gas) matches IOU service type at the installation location

Bill Impact Estimate provided to the customer. (Can use a CAEATFA-supplied BIE)

Project and Measure Eligibility See regulations §10093.5(a)



Projects May be Subject to Post-Installation Verification Checks

Project and Measure Eligibility See regulations §10093.5(d)

Desk

top

Verif

icat

ion • Electronic review

of project data and documentation

• IOU service• IOU rebates

(if applicable)• Fuel type match• Measure cost

breakdown• Invoice check

Phot

o Ve

rific

atio

n • Photographic review of equipment type and installation

• May also include desktop verification

Fiel

d Ve

rific

atio

n • On-site review of equipment type, quantity and installation

• May also include desktop verification



Seeking Feedback on Project and Measure Eligibility:

1. Does it create an undo burden to require copies of all required permits in order to enroll a project in this financing?

Project and Measure Eligibility



Executive Summary

Background

Program Structure


Project Lifecycle

Feedback




Credit Enhancement is Structured as a Loss ReserveNo Cost to Finance Company or Customer

Loan Loss Reserve Structure:o Current budget: $2.9 million. CAEATFA can shift

more funds to the Program if there is demando Trustee accounts: Designated Loss Reserve (LR)

accounts for participating finance entities at a Trustee Bank

o Contributions: Made to finance company’s LR account within 10 days of receiving an eligible loan, lease, service agreement or savings-based payment agreements

o Access to funds: In event of default, finance entity can file claim to recoup up to 90% of principal loss

o Option for sub accounts: Finance companies selling loans/leases to different investors may benefit from sub-accounts for additional investors

Affordable MF CE Funds

$2.9 Million

Lender ABC

Lease Co. XYZ

Sub Acct 1

Sub Acct 2

Credit Enhancement Structure



See regulations §10093.7(C)(2)

Credit Enhancement Amount

Claim-Eligible Financed Amount

Contribution Rate

$1 Million 15%

Finance entities build their loan loss reserve account by financing multiple projects.

o Only $1 million is “Claim-Eligible Financing

o Up to 10 year term

Credit Enhancement Structure



Finance Company May Recoup 90% ofClaim-eligible Charge-off Amount

o Financing is “Claim-Eligible” for 10 yearso Payments are paid “net of recovery” – company

won’t be made more than 100% wholeo If finance company recovers additional funds after

claim is paid such that they are more than 100% whole, finance company reimburses the Program

o Finance company takes reasonable steps toward recovery (in line with industry standard) through liquidation of collateral or collecting personal guarantees, if applicable

o Finance company can assign payment to a third party

o If funds in LR Account are insufficient to cover 90% of charge-off, future contributions can be accessed to cover the charge-off.

Claims Process

Financing customer defaults Loan/lease/agreement is charged off

Finance entity takes reasonable collection steps

Finance entity files claim with Program within 180 days of charge-off

Program pays out 90% of claim-eligible charged off amount, funds in LR account permitting

See appendix for an example of a claim calculation

Credit Enhancement Structure See regulations §10093.8



CAEATFA is aiming for product parity in terms of the Credit Enhancement; Ongoing service fees are not “Claim-Eligible”

Loans & Leases / Equipment Finance

Agreements

• The original principal amount as disclosed to the Eligible Affordable Multifamily Financing Customer through loan or lease documentation or the job addendum.

Service Agreements / Savings-Based Payment

Agreements

• The total installation amount paid to the contractor and/or disclosed on the job addendum, inclusive of equipment, taxes, labor and shipping costs and exclusive of ongoing service and oversight payments by Eligible Affordable Multifamily Financing Customer.

Total Financed Amount

Loans & Leases / Equipment Finance

Agreements• The outstanding principal at the time of charge-off

Service Agreements / Savings-Based

Payment Agreements

• (Total initial installation amount paid to contractor(s) divided by the number of months in the term) multiplied by the number of months remaining in the term. Ongoing monthly service charges are excluded from the charge-off amount.

Total Charge-Off Amount

See regulations §10093.1(yy)&(xx)



CAEATFA Will Rebalance the Loan LossReserve Accounts Annually

o CPUC Decision 13-09-044 requires CAEATFA to recapture funds periodically for Program use or to return to Ratepayers for other programs

o CAEATFA wants to balance allowing finance companies to build up their LR account balances with having credit enhancement funds available for additional projects

o Proposed rebalance methodology makes allowances for claims, supporting the “portfolio insurance” feature of the LR Account

Rebalancing ProcessIn July, CAEATFA looks at previous fiscal year to see which

enrolled loans/leases/agreements have fully paid off

CAEATFA recoups original LR contribution amount for paid off loans/leases/agreements

If a claim has been made during the fiscal year, CAEATFA will reduce the recapture amount by the amount of the claim

If the claim amount is larger than the recapture amount, there will be no recapture of funds for that year

Credit Enhancement Structure See regulations §10093.7(d)&(e)



Executive Summary

Background

Program Structure


Project Lifecycle

Feedback




Finance Companies Can Perform Multiple Functions

Marketing Representation

• Entity that is publicly listed as part of the Program on websites and in marketing materials

Underwriting

• Follows Program guidelines for approving projects and financing

Origination

• Executes the legal contract for repayment of the financing

• Obtains financing customer certifications

Finance Companies Eligibility and Roles See regulations §10093.2(b)



Financing Submittal

• Reviews contractor and customer data for a project, and submits along with financing data to CAEATFA for Enrollment in the program.

Servicing

• Sends out regular billing statements and collects payments

• Allocates payments to investors

• Engages in collections• Responds to customer

questions

Monthly Reporting

• Supplies CAEATFA with regular monthly reports covering loan/lease/agreement performance data as well as data on any sale or transfer of the financing

LR Account Representation

• Loss reserve accounts will be set up in the name of this entity at the Trustee Bank

• Files claims in the case of a charge-off

• Receives claim payments

• May distribute claim payments to third parties

Finance Companies Eligibility and Roles See regulations §10093.2(b)

Finance Companies Can Perform Multiple Functions (cont.)



To Accommodate Various Business Models, CAEATFAis Proposing a Flexible Participation Strategy

o Two entities can join together to apply to the program as a primary applicant and an affiliate-applicant

Both must sign an enrollment application and certifications, representations, and warranties

o Primary applicant fulfills the role of submitting loans to CAEATFA

o Applicants disclose which entity will perform the roles of: Underwriting, Origination, Servicing, Monthly Reporting, Loss Reserve Account Representative

o Applicants may designate a third entity to be the Marketing Representative or may designate the primary or affiliate applicant to this role

o Applicants disclose what entity is funding the actual agreements and named on the documents. This may be a third party

Finance Companies Eligibility and Roles See regulations §10093.2(a)-(b)



Regardless of Structure, Applicants Must Meet Key Requirements

Representation • Agrees to comply with Program rules in marketing and representing the Program

Proposed Product(s) • One applicant outlines and certifies proposed rates, terms, and credit requirements to be offered as part of the Program

Customer Benefits • One applicant describes and certifies how financing customers will benefit from the Applicants’ access to the credit enhancement

Licenses • Applicants certify that they hold proper licenses for engaging in their business activities in California

Intent with Enrolled Financing

• Applicants describe the intent for Enrolled Financings, (e.g. hold, sell, transfer, participate, portfolio, warehouse) and the purchaser, if known

Finance Companies Eligibility and Roles See regulations §10093.2(c)



Non-Financial Institutions Can Participatewith Additional Requirements

o A Financial Institution, for purposes of the Program, is a federally insured depository, Financial Development Corporation (FDC), or a CDFI

o Applicants who are not Financial Institutions must maintain General Liability, Motor Vehicle Liability, and Worker’s Compensation insurance

o Additional requirements for the entity performing these functions if not a Financial Institution:

Underwriting

• Demonstrated experience with underwriting for equipment financing

• Describe the underwriting process• Demonstrate qualifications of key

personnel• Net Worth of at least $1MM

Origination

• Demonstrate at least $20MM in committed capital for general financing

• Net Worth of at least $1MM• Demonstrated ability to originate

commercial financing in accordance with all applicable laws

• Provide sample documentation

Servicing

• Demonstrated capacity for and experience with servicing

• Net Worth of at least $1MM • Describe key personnel, software,

and systems used

Finance Companies Eligibility and Roles See regulations §10093.3



Seeking Feedback on Finance Company Eligibility & Roles:

1. Is the requirement to demonstrate at least $20MM in committed capital for general financing too much for some finance companies?

2. Should we consider a requirement to demonstrate at least $20MM in committed capital OR a certain amount of transactions originated?

Finance Company Eligibility & Roles



Executive Summary

Background

Program Structure


Project Lifecycle

Feedback




Program supports a variety of financing instruments

Loan

• Customer takes ownership of measures

• Fully amortizing (fixed payments amortize loan to $0) or balloon structures (ie. fixed payments for loan term with a final payment at end of loan term)

Lease/Efficiency Financing Agreement

• Customer gets use of measures

• Title can transfer at end of lease term or at beginning of term (Equipment Finance Agreement)

Service Agreement

• Customer gets use of measures

• Regular, ongoing service and maintenance of measures is provided to the customer

• Title does not transfer to customer

• Guarantee of functionality of measures or guarantee of energy savings

Savings-Based Payment

Agreement• Savings measured

and verified at least annually

• Agreement is “cash-flow positive” for customer compared to prior energy bills

• Customer shares in benefits if savings exceed expectations

• Customer does not bear risk if savings are less than projected

Financial Product Eligibility See regulations §10093.1(q), (p), (t), and (s)



Product RequirementsCategory Specification

Disclosure

Finance entity must disclose to the customer either(1) an Annual Percentage Rate (APR) inclusive of any fees as well as

advance payments OR (2) The total cost of the project comprised of (monthly payments x number

of months in the agreement) + fees

Interest rate• No cap, although as part of application process, finance entity must

demonstrate a customer benefit in exchange for receiving credit enhancement; that benefit may or may not be reduced interest rates.

• Rates may be fixed or variable

Term Length• No restriction (although period for filing claims in case of default is

limited to 10 years)• No open-ended lines of credit

Financing Minimum None

Financing Maximum • Credit enhancement stops at $1MM• No maximum total financing amount

Financial Product Eligibility See regulations §10093.4



Product Requirements, Continued

Category Specification

Refinance or Renewal Permitted if loan/lease/service agreement/savings-based payment agreement is enrolled with the Program within 90 days of project completion.

Fees• Must be disclosed on finance company’s application to our program • Must be reasonable and in-line with industry standards• Must be disclosed to customer or presented as part of an APR

Financial Product Eligibility See regulations §10093.4



Seeking Feedback on Finance Company Requirements:

1. Is $2MM of General Liability Insurance the appropriate amount?

Finance Companies Eligibility and Roles



Executive Summary

Background

Program Structure


Project Lifecycle

Feedback




Program Should Enable Sale and Transfer of Enrolled Financingso Program goals include bringing more private capital to the energy efficiency financing spaceo Therefore, program should facilitate the sale and transfer of enrolled loans, leases and ESAs, while

recognizing that the structure of the Loss Reserve steers Participating Finance Companies toward a limited number of purchasers

Permitted activity • Sale, transfer, or assignment of an enrolled financing in whole or in part• Sale, transfer, or assignment of a portfolio of enrolled financings in whole or in part

Reporting of sales • Finance company reports to CAEATFA monthly on sales, transfers, or assignments including date of sale and name of purchaser/assignee

Trustee sub accounts • CAEATFA will open up to 3 sub-accounts for finance companies that want to group loans/leases/ESA for a specific investor

Ongoing program responsibility

• Entity(s) originally responsible for monthly reporting and assigned as the Loss Reserve Account representative retain responsibility for those activities unless a successor enrolls in the Program

Successor enrollment in program

• CAEATFA allows transfer of responsibility for the servicing, reporting, and Loss Reserve Account Representative roles to a new entity when financings are sold

Enabling a Secondary Market See regulations §10093.9 & §10093.10



Executive Summary

Background

Program Structure


Project Lifecycle

Feedback




Project and Financing through the Program Partner Method

Finance Company

CAEATFA

Customer

Enroll agreement, fund loss reserve account

Initial project review, estimate loss reserve contribution

Certify satisfaction, disclosures

Choose finance company

Performs energy audit to

determine energy savings

Determines scope of work

Underwriting processSubmit project & financing data for enrollment within

90 days

ProgramPartner Certify completion

Customer’s contractor installs project

Flags eligible projects



Finance Company Reports Monthly on all Enrolled Financing Agreements

o Financing status: current, 30 days, 60 days, or 90 days past due, fully satisfied, or charged off

o Current outstanding financed amounto Updates to the maturity or contractual end date,

payment amount, and/or interest rateo If sold or transferred, date of sale or transfer and

name of purchaser or transfereeo For Delinquencies and Charge-offs:

Date and amount of any charge-off and whether enforcement proceedings have begun

Any anticipated losses and whether acceleration notices have been sent

Amount of any recoveries or proceeds from charged-off financings

See regulations §10093.10

Simple excel report Readily available data



Executive Summary

Background

Program Structure


Project Lifecycle

Feedback




Finance Entity Requirements:1. Is $2MM of General Liability insurance the appropriate amount?2. Is requiring $20 million in committed capital in order to enroll in the program reasonable?3. Should we consider a requirement to demonstrate at least $20MM in committed capital OR a certain amount of

transactions originated?

Project Requirements:1. Is it reasonable to require recorded affordability deed restriction or covenant to an affordable multifamily home to

have 10 years of restriction remaining? 2. Do you foresee any concerns with the requirement that all permits be closed/approved before funding the loss

reserve accounts?

Summary of Questions for Feedback

We encourage you to comment on any provision of the Regulations, beyond the specific questions we have posed here.



We Want Your Comments and Input!

o Please provide comments during this workshop or afterwards by 5:00 PM on Friday March 8, 2019.o CAEATFA will consider all comments and incorporate them as appropriate.o Proposed regulations are available at: https://www.treasurer.ca.gov/caeatfa/cheef/multifamily.asp

Comments can be submitted to: [email protected]

Or to

Susan MillsProgram Specialist, [email protected]


https://www.treasurer.ca.gov/caeatfa/cheef/multifamily.asp




Executive Summary

Background

Program Structure


Project Lifecycle

Feedback




CHEEF Pilot Program OverviewREEL

(Residential)Affordable

Multi-FamilySmall

Business Non-Residential

Designed for Homeowners or renters,upgrading 1-4 units

Owners of properties with at least 50% income restricted

units

SBA size small businesses and

non-profits

Any size business or non-profit; government

and public entities

Financing Products Loans, RICsUp to $50,000

Loans, leases, service agreements, savings-based

payment agreements**

Loans, leases, service agreements, savings-

based payment agreements

Up to $5MM**

Loans, leases, service agreements, savings-

based payment agreementsUp to $5MM

Repayment Direct to lender Direct to lender or through utility bill

Direct to lender or through utility bill Through utility bill

Credit Enhancement Initial Authorization

Loan Loss ReserveUp to $25MM

Loss ReserveUp to $2.9MM

Loss ReserveUp to $14MM None

StatusLaunched summer 2016, modifications made Fall 2017 and Spring 2018

Launching 2019 Limited launch: Apr ’18full launch: Aug ‘19 TBD

** Only first $1MM in financing will receive a credit enhancement



Example of a ClaimOriginal Total Service Agreement Amount $500,000

Original Claim-Eligible Financed Amount $300,000 e.g. $200,000 of original amount for solar and PV charging station

Claim-Eligible Percentage 60% Original Claim Eligible Financed Amount / Original Total Service Agreement Amount

Total Outstanding Amount at time of charge-off $100,000

Total Outstanding Claim-Eligible Amount at time of charge-off $60,000 Claim-Eligible Percentage x Total Outstanding Amount at time of

charge-off

Total potential claim allowance $54,000 90% x Total Outstanding Claim-Eligible Financed Amount

“Charge-Off” means: For loans and leases - outstanding principal balance at the time of charge-off. For service agreements or savings-based payment agreements - the Original Total Financed Amount divided by the number of months in the term multiplied by the number of months remaining in the term.



Measure Category Measure RequirementsIOU Fuel

Source Eligibility

Eligible for Self-Install

Agriculture Automatic Pump Shut-off Sensor Electric NoAgriculture Booster or Well Pump Electric No

Agriculture Heat Recovery Electric Gas No

Agriculture High Efficiency Ventilation Fan Electric NoAgriculture Irrigation Pump Electric NoAgriculture Irrigation Pump Testing Electric NoAgriculture Plate Cooler Electric NoAgriculture Sprinkler-to-Drip Irrigation Electric NoAgriculture VFD on Booster or Well Pump Motor Electric NoAgriculture VFD on Pump or Fan Motor Electric NoAppliances Air Cleaner/Purifier Energy Star Electric YesAppliances Clothes Dryer (Electric) Energy Star Electric YesAppliances Clothes Dryer (Gas) Energy Star Gas YesAppliances Clothes Washer (Electric Hot Water) Energy Star Electric YesAppliances Clothes Washer (Gas Hot Water) Energy Star Gas YesAppliances Dishwasher (Electric Hot Water) Energy Star Electric YesAppliances Dishwasher (Gas Hot Water) Energy Star Gas YesAppliances Freezer Energy Star Electric YesAppliances Refrigerator Energy Star Electric Yes

Building Envelope Air Sealing Electric Gas No

Energy Saving Measure (ESM) List – Page 1 of 13See Commercial regulations

§10092.14



Energy Saving Measure (ESM) List – Page 2 of 13


Source Eligibility


Building Envelope Attic Insulation Electric Gas No

Building Envelope Cool Roof Must be certified by Cool Roof Rating Council (CRRC) Electric No

Building Envelope Floor Insulation Electric Gas No

Building Envelope Heat Reflective Coating Product must have solar reflectance ≥ 0.5 as tested to ASTM C1549-16 Electric No

Building Envelope Radiant Barrier Electric No

Building Envelope Wall Insulation Electric Gas No

Building Envelope Window Film Electric Gas Yes

Building Envelope Windows Electric Gas No

Data Centers Airflow Management Device Electric NoData Centers Aisle Containment Electric NoData Centers Aisle Layout Optimization Separate hot and cold aisles Electric NoData Centers Efficient Network Equipment Energy Star Electric YesData Centers Efficient Server Energy Star Electric YesData Centers Efficient UPS Energy Star Electric Yes

See Commercial regulations §10092.14





Source Eligibility


Data Centers Server Consolidation Electric NoData Centers Server Virtualization Electric No

Demand Response Automated Demand Response Equipment Electric Gas No

Demand Response Mechanical Energy Storage (MES) System Must be used for the purpose of permanent load shifting (PLS) Electric No

Demand Response Thermal Energy Storage (TES) System Must be used for the purpose of permanent load shifting (PLS) Electric No

Food Service Commercial Cooking Equipment Energy Star griddles, ovens, steam cookers, or fryers

Electric Gas Yes

Food Service Commercial Dishwashing Equipment Energy Star Electric Gas Yes

Food Service Hot Holding Cabinet Energy Star Electric Yes

Food Service Low Flow Pre-Rinse Spray Valve Electric Gas Yes

Food Service On-demand Hand Wrap Machine Electric Yes

Food Service Ventilation Hood Control Electric Gas No

HVAC Air Filter Sensor or Automatic Filter Replacement Electric No

HVAC Air-Source or Ground-Source Heat Pump Electric Gas No






Source Eligibility


HVAC Air-Side or Water-Side Economizer Electric NoHVAC Automatic Temperature Setpoint Control Electric NoHVAC Chilled Water Outdoor Temperature Reset Electric NoHVAC Chiller Optimization Control Electric NoHVAC Chiller Upgrade, Retrofit, or Replacement Electric No

HVAC Cold Water Booster Pump Variable speed pump with ECM motor Electric No

HVAC Compressor or Condenser Electric NoHVAC Condensate Recovery Gas NoHVAC Cooling Tower Upgrade, Retrofit, or Replacement Electric No

HVAC Demand Controlled Ventilation Electric Gas No

HVAC Dual Enthalpy Control Electric No

HVAC Duct Insulation Electric Gas No

HVAC Duct Sealing (Existing) Electric Gas No

HVAC Duct Sealing (New) Electric Gas No






Source Eligibility


HVAC Evaporative Cooling Electric NoHVAC Fan or Motor Control Electric NoHVAC Furnace - Commercial Gas NoHVAC Furnace - Residential In-Unit Energy Star Gas No

HVAC Furnace Fan Brushless DC MotorBrushless Permanent Magnet (BPM) or Electronically Commutated Motors (ECM) motors

Electric No

HVAC Gas Hydronic Boiler - Commercial Gas NoHVAC Gas Boiler - Residential In-Unit Gas NoHVAC Gas Steam Boiler - Commercial Gas No

HVAC Heat Recovery Electric Gas No

HVAC Heat/Energy Recovery Ventilator Electric Gas No

HVAC High Performance Circulator Pump Variable speed pump with ECM motor Electric No

HVAC Hotel Guest Room Occupancy Temperature Control Electric Gas No

HVAC Infrared Gas Heater Gas NoHVAC Notched or Synchronous Drive Belt Electric Yes






Source Eligibility


HVAC Outside Air Reduction Electric Gas No

HVAC Packaged Terminal Air Conditioner (PTAC) Electric No

HVAC Pipe Insulation Electric Gas No

HVAC Rooftop Units or Packaged HVAC System Electric Gas No

HVAC Rooftop Unit Control Must include VFD control of RTU supply fan speed

Electric Gas No

HVAC Smart Thermostat Programmable and communicating thermostat

Electric Gas Yes

HVAC Split/Mini Split Air Conditioning Unit - Commercial Electric NoHVAC Split/Mini Split Air Conditioning Unit - Residential 18 SEER or above Electric No

HVAC Static Pressure Reset Electric Gas No

HVAC Steam Trap Audit/Replacement Gas No

HVAC Variable Air Volume Electric Gas No

HVAC Ventilation Fan Energy Star Electric NoHVAC VFD on Compressor Motor Electric NoHVAC VFD on Pump or Fan Motor Electric No






Source Eligibility


HVAC Wall Furnace (Fan-type) Gas NoHVAC Wall Furnace (Gravity) Gas NoIndustrial Air Receiver Tanks for Load/No Load Compressor Electric NoIndustrial All-Electric Injection Molding Machine Electric NoIndustrial Compressed Air Cycling, Desiccant, or Heat Pump Dryer Electric NoIndustrial Compressed Air Leak Audit and Repair Electric NoIndustrial Compressed Air No-Loss Drain Electric NoIndustrial Compressed Air Pressure Reduction Electric NoIndustrial Energy Recovery Pressure Reducing Valve Electric No

Industrial Exhaust Hood Control Electric Gas No

Industrial High Performance Circulator Pump Variable speed pump with ECM motor Electric NoIndustrial Notched or Synchronous Drive Belt Electric YesIndustrial Premium Efficiency Motor Exceed EISA 2007 Electric No

Industrial Process Heat Recovery Electric Gas No

Industrial Process Pump Electric No

Industrial SCADA System Electric Gas No

Industrial VFD on Compressor Motor Electric NoIndustrial VFD on Process Pump or Fan Motor Electric No






Source Eligibility


Lighting Controls: Indoor Daylight Sensor Electric No

Lighting Controls: Indoor Networked Lighting System DLC qualified Networked Lighting Control Electric No

Lighting Controls: Indoor Vacancy Sensor Electric No

Lighting Controls: Integrated Networked Lighting System DLC qualified Networked Lighting Control Electric No

Lighting Controls: Integrated Vacancy and Daylight Sensor Sensors are integral to the light fixture Electric No

Lighting Controls: Integrated Vacancy Sensor Sensors are integral to the light fixture Electric No

Lighting Controls: Outdoor Networked Lighting System DLC qualified Networked Lighting Control Electric No

Lighting Controls: Outdoor Occupancy Sensor Electric NoLighting LED Accent/Track Light Fixture Energy Star Electric No

Lighting LED Case Light FixtureDLC qualified display case, horizontal refrigerated case, or vertical refrigerated case

Electric No

Lighting LED Ceiling Mount or Pendant Fixture Energy Star Electric No

Lighting LED Decorative Lamp Energy Star screw- or pin-base candle or globe Electric Yes

Lighting LED Directional Lamp Energy Star screw- or pin-base reflector Electric Yes






Source Eligibility


Lighting LED Downlight Fixture Energy Star hard-wired recessed, surface, or pendant mount Electric No

Lighting LED Downlight Screw-base Retrofit Kit Energy Star recessed or surface mount; screw base retrofit Electric Yes

Lighting LED Four-Pin Replacement Lamp DLC qualified vertical or horizontal lamps; UL type A Electric Yes

Lighting LED General Service Lamp Energy Star screw- or pin-base standard A-type Electric Yes

Lighting LED High/Low-Bay Fixture or Retrofit Kit DLC qualified high-bay, low-bay, or high-bay aisle Electric No

Lighting LED Interior Directional Fixture DLC qualified wall wash or track Electric NoLighting LED Linear Ambient Fixture or Retrofit Kit DLC qualified direct or indirect linear Electric No

Lighting LED Linear Replacement Lamp (TLED) DL qualified T8 or T5; 2', 4', U-bend; UL types A, B, C Electric Yes

Lighting LED Mogul Screw Base Replacement Lamp - Indoor DLC qualified high- or low-bay; UL types B or C Electric Yes

Lighting LED Mogul Screw Base Replacement Lamp - Outdoor DLC qualified UL types B or C Electric Yes

Lighting LED Outdoor Area Light Fixture or Retrofit Kit

DLC qualified pole/arm-mounted area, decorative, wall-mounted, bollards, parking garage, canopy, flood, spot, stairwell

Electric No






Source Eligibility


Lighting LED Outdoor Wall, Porch, Post, or Security Light Fixture Energy Star wall, porch, post or security Electric No

Lighting LED Street Light Fixture or Retrofit Kit DLC qualified pole/arm-mounted roadway Electric No

Lighting LED Troffer Fixture or Retrofit Kit DLC qualified 2x2, 1x4, or 2x4 Electric NoLighting LED Under-Cabinet or Cove Fixture Energy Star Electric No

Other Building Management System (BMS) Electric Gas No

Other Energy Audit Electric Gas No

Other Energy Management System (EMS) Electric Gas No

Other Energy Measurement, Metering or Monitoring EquipmentMust be installed with at least one other non-lighting Energy Savings Measure on this list

Electric Gas No

Other Generator Circulating Block Heater Electric NoOther High Efficiency Distribution Transformer Electric NoOther Plug Load Control Electric Yes






Source Eligibility


Pools Gas Pool Water Heater Energy Star Gas NoPools Heat Pump Pool Water Heater Energy Star Electric NoPools Pool Cover (Electric Heater) Electric YesPools Pool Cover (Gas Heater) Gas YesPools Pool Pump Motor Energy Star Electric NoPools VFD on Pool Pump Motor Electric NoRefrigeration Add Doors to Open Case Electric YesRefrigeration Add Insulation to Refrigerant Lines or Storage Tanks Electric NoRefrigeration Air Curtain Electric NoRefrigeration Anti-Condensation Door/Frame Heater Control Electric NoRefrigeration Auto-Close Doors for Walk-in Cooler or Freezer Electric NoRefrigeration Commercial Ice Machine Energy Star Electric YesRefrigeration Commercial Refrigerator or Freezer Energy Star Electric YesRefrigeration Compressor Unit Electric NoRefrigeration Condensing Unit Electric NoRefrigeration Evaporator Defrost Control for Freezer Electric No

Refrigeration Evaporator Fan Brushless DC MotorBrushless Permanent Magnet (BPM) or Electronically Commutated Motors (ECM) motors

Electric No

Refrigeration Evaporator Fan Motor Control Electric No






Source Eligibility


Refrigeration Floating Head Pressure Control Electric NoRefrigeration Low Charge Ammonia Electric NoRefrigeration Low Energy Anti-Condensation Door Electric No

Refrigeration Phase Change Material for Refrigerated or Freezer Storage Electric Yes

Refrigeration Rapid Close Doors for Refrigerated Warehouse Electric NoRefrigeration Reach-in Refrigerator or Freezer Energy Star Electric YesRefrigeration Refrigerated Case Door Strip Electric NoRefrigeration Refrigerated Case Night Cover Electric YesRefrigeration Variable Refrigerant Flow Electric NoRefrigeration Vending Machines Energy Star Electric YesRefrigeration VFD on Refrigeration Pump or Fan Motor Electric NoWater Heating Central Gas Domestic Water Heater or Boiler Gas NoWater Heating Faucet Aerator (Electric Hot Water) Electric YesWater Heating Faucet Aerator (Gas Hot Water) Gas YesWater Heating Faucet Laminar Flow Restrictor (Electric Hot Water) Electric YesWater Heating Faucet Laminar Flow Restrictor (Gas Hot Water) Gas Yes






Source Eligibility


Water Heating Heat Pump Water Heater Energy Star Electric NoWater Heating Shower head - low flow (Electric Hot Water) Electric YesWater Heating Shower head - low flow (Gas Hot Water) Gas YesWater Heating Ozone Laundry System (Electric Hot Water) Electric NoWater Heating Ozone Laundry System (Gas Hot Water) Gas NoWater Heating Shower Thermostatic Valve (Electric Hot Water) Electric NoWater Heating Shower Thermostatic Valve (Gas Hot Water) Gas NoWater Heating Tank Insulation (Electric Hot Water) Electric YesWater Heating Tank Insulation (Gas Hot Water) Gas YesWater Heating Tank Water Heater (Gas) Energy Star Gas NoWater Heating Electric Tankless Water Heater (Electric) Electric NoWater Heating Gas Tankless Water Heater (Gas) Energy Star Gas No



Date post:	09-Jun-2020
Category:	Documents
Upload:	others
View:	2 times
Download:	0 times

Affordable Multifamily Energy Efficiency Financing Program ... · 2/26/2019 · Affordable...

Documents