PACE clean-up bill clears first hurdle
Last year, the legislature hastily passed a measure to regulate Property Assessed Clean Energy or “PACE” financing programs and in the process, created a new exemption under the California Public Records Act.
This year, Senator Richard Roth (D-Riverside) is the author of a bill to remove that provision with SB 1087. The bill would require the release of information about PACE solicitors and agents who are asked to cease operation or take other corrective action. This will ensure the integrity of the program by making bad actors and practices public, allowing the public and legislature to better monitor the program’s efficacy.
PACE programs are established by government agencies to help homeowners pay for energy-efficient appliances and projects through loans that are paid back as line items on their property tax bills. The potential for abuse is significant: consumer groups say contractors serve as de-facto mortgage brokers who often misrepresent how the financing works, ultimately saddling people with loans they can’t afford which have led to some foreclosures as a result.
Just last week, consumer advocates filed a class action lawsuit against the County of Los Angeles and the two companies largely responsible for soliciting the majority of PACE loans in the state alleging that the county and lenders have committed financial elder abuse by failing to ensure that individuals could afford the PACE loan before they took it out.
SB 1087 would ensure that malfeasance related to the PACE program is publicly disclosed. The bill was passed with a 7-0 vote out of the Senate Banking Committee this week, and was referred to the Appropriations Committee.