Tourism, Infrastructure & Energy Subcommittee, March 11, 2021: HB 919, Preemption Over Restriction of Utility Services
Summary
A meeting packet of the Tourism, Infrastructure & Energy Subcommittee for March 11, 2021, made up of bill analyses and bill text for the bills it heard. It opens with a staff analysis dated 3/9/2021 of present law on local government powers, covering home rule under Article VIII of the Florida Constitution, charter and noncharter counties, and the powers that Section 125.01, F.S., gives a county's governing body. The packet closes with a proposed committee substitute for HB 387, whose final section requires an annual report on assessments that funded qualifying improvements, including defaulted assessments, the estimated number of jobs created and the share of participating homeowners 60 years of age or older. The substitute would take effect July 1, 2021.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
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“Tourism, Infrastructure & Energy Subcommittee, March 11, 2021: HB 919, Preemption Over Restriction of Utility Services.”
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FULL ANALYSIS
I. SUBSTANTIVE ANALYSIS
A. EFFECT OF PROPOSED CHANGES:
Present Situation
Local Government Powers 1
Article VIII of the Florida Constitution establishes the authority for home rule by counties and
municipalities in Florida. The Legislature is required to divide the state into counties 2 and has the
authority to choose to create municipalities.3 The Florida Constitution recognizes two types of county
government in Florida : those operating under a county charter and those without a charter. Florida
currently has 67 counties.4 County ordinances must be filed with the custodian of state records, and
take effect at the time provided by law. 5
Noncharter Counties
A county without a charter has such power of self-government as provided by general 6 or special law,
and may enact county ordinances not inconsistent with general law. 7 General law authorizes counties
"the power to carry on county government" 6 and to "perform any other acts not inconsistent with law,
which acts are in the common interest of the people of the county, and exercise all powers and
privileges not specifically prohibited by law."9
Section 125.01, F.S., provides that the legislative and governing body of a county shall have the power
to carry on county government and that "to the extent not inconsistent with general or special law," this
power includes, among other things, the power to:
• Prepare and enforce comprehensive plans for the development of the county.
• Establish, coordinate, and enforce zoning and such business regulations as are necessary
for the protection of the public.
• Enforce the Florida Building Code, and adopt and enforce local technical amendments
thereto.
• Establish and administer programs of housing, slum clearance, community redevelopment,
conservation, flood and beach erosion control, air pollution control, and navigation and
drainage and cooperate with governmental agencies and private enterprises in the
development and operation of such programs.
• Establish, merge or abolish municipal service taxing or benefit units for any part or all of the
unincorporated area of the county, within which may be provided a number of essential
facilities and municipal services from funds derived from service charges, special
assessments, or taxes.
• Levy and collect taxes and special assessments; borrow and expend money; and issue
bonds, revenue certificates, and other obligations of indebtedness.
• Adopt ordinances and resolutions necessary for the exercise of its powers and prescribe
fines and penalties for the violation of ordinances in accordance with law.
1
See generally Florida House of Representatives, Local Government Formation Manual 2018-2020, Chapter I.
2 FLA. CONST. art. VIII, s. l(a).
3
FLA. CONST. art. VIII, s. 2(a).
4
See Local Government Formation Manual 2018-2020, Appendix B for a list of these counties and their dates of incorporation.
5
FLA. CONST. art. VIII, s. 2(i).
6
ch. 125, Part I, F.S.
7 FLA. CONST. art. VIII, s. l(f).
8
S. 125.01(1), F.S.
9 S. 125.0l(l)(w), F.S.
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Section 125.01, F.S., also provides:
• The enumeration of powers herein may not be deemed exclusive or restrictive, but is
deemed to incorporate all implied powers necessary or incident to carrying out such powers
enumerated.
• The provisions of this section shall be liberally construed in order to effectively carry out the
purpose of this section and to secure for the counties the broad exercise of home rule
powers authorized by the State Constitution.
The governing body of a county also has the power to establish, and subsequently merge or abolish,
dependent special districts including both incorporated and unincorporated areas.
This delegation of home rule power to noncharter counties is broad. 10 Nevertheless, it is a legislative,
not a constitutional, grant of home rule power, and as such is subject to legislative regulation through
law in the same manner as is a municipality. 11
Noncharter counties must organize their governing body either in the traditional commission form or the
commission-administrator form of county government, which may be enacted by county ordinance. 12 If
an ordinance enacted by a noncharter county conflicts with a municipal ordinance, the county
ordinance is not effective within the municipality to the extent of the conflict. 13
Charter Counties
Pursuant either to general 14 or special law, a county government may be adopted by charter approved
by the county voters. A county with a charter has all powers of self-government not inconsistent with
general law or special law approved by the county voters. The governing body of a county operating
under a charter may enact county ordinances not inconsistent with general law. In the event of a
conflict between a county and municipal ordinance, the charter must provide which ordinance
prevails. 15
Article VI 11, section 6( e) of the Florida Constitution incorporates by reference sections of the 1885
Constitution, providing unique authorization 16 for specific home rule charters including those of Duval 17
and Miami-Dade Counties. 18 Currently, 20 Florida counties have adopted charters. 19
The most significant distinction between charter and non-charter county power is the constitutional
provision for direct power of self-government to a county upon charter approval, whereas a non-charter
county has "such power of self-government as is provided by general or special law." Charter counties
possess greater home rule authority than non-charter counties, as follows 20 :
10
Santa Rosa County v. Gulf Power Corp., 635 So. 2d 96 (Fla. 1st DCA. 1994).
11
David G. Tucker, A Primer On Counties and Municipalities - Part I, 81 FLA. BAR J. 49 (2007).
12 See ss. 125.01 (1), 125.72, F.S.
13 Id.
14
S. 125.60, F.S.
15
FLA. CONST. art. VIII, s. l(g).
16
Article VIII, section 6(e) of the Florida Constitution, states that specific provisions for Duval, Miami-Dade, Monroe, and Hillsborough Counties
"shall remain in full force and effect as to each county affected, as if this article had not been adopted, until that county shall expressly adopt a
charter or home rule plan pursuant to this article."
17
The consolidated government of the City of Jacksonville was created by Ch. 67-1320, Laws of Fla., adopted pursuant to article VIII, section 9 of
the 1885 Florida Constitution.
18
Dade County, now known as Miami-Dade County, has unique home rule status. Article VIII, section 11 (5) of the 1885 Florida Constitution, now
incorporated by reference in article VIII, section 6(e) of the 1968 Florida Constitution, further provided the Metropolitan Dade County Home Rule
Charter, and any subsequent ordinances enacted pursuant to the charter, may conflict with, modify, or nullify any existing local, special, or general
law applicable only to Dade County. Accordingly, Miami-Dade County ordinances enacted pursuant to the Charter may implicitly, as well as
expressly, amend or repeal a special act that conflicts with a Miami-Dade County ordinance. Effectively, the Miami-Dade Charter can only be altered
through constitutional amendment, general law, or County actions approved by referendum. Chase v. Cowart, 102 So. 2d 147, 149-50 (Fla. 1958).
19
Alachua, Brevard, Broward, Charlotte, Clay, Columbia, Duval (consolidated government with the City ofJacksonville, ch. 67-1320, Laws of Fla.),
Hillsborough, Lee, Leon, Miami-Dade, Orange, Osceola, Palm Beach, Pinellas, Polk, Sarasota, Seminole, Volusia, and Wakulla Counties. Local
Government Formation Manual 2018-2020, p. 4.
20
Id. at 4.
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• A special act of the Legislature may not diminish the home rule powers of a charter county
unless the act is approved by electors in the county. 21
• A county's charter may authorize the county to regulate an activity on a countywide basis
and provide that the county regulation prevails over any conflicting municipal ordinance. 22
• A charter county may levy any tax within its jurisdiction that is authorized by general law for
a municipality unless the general law prohibits levy by a county. 23
Municipalities 24
A municipality is a local government entity created to perform functions and provide services for the
particular benefit of the population within the municipality, in addition to those provided by the county.
The term "municipality" may be used interchangeably with the terms "town," "city," and "village."
Article VIII, section 2 of the Florida Constitution provides that municipalities "shall have governmental,
corporate and proprietary powers to enable them to conduct municipal government, perform municipal
functions and render municipal services, and may exercise any power for municipal purposes except as
otherwise provided by law. 25
Chapter 166, F.S., also known as the Municipal Home Rule Powers Act, 26 acknowledges the
constitutional grant to municipalities of governmental, corporate, and proprietary power necessary to
conduct municipal government, functions, and services. 27 Chapter 166, F.S., provides municipalities
with broad home rule powers, respecting expressed limits on municipal powers established by the
Florida Constitution, applicable laws, and county charters. 28 Pursuant to these powers, approximately
32 Florida municipalities own, operate, and control electric utilities, and 26 municipalities own, operate
and control natural gas utilities. At least one municipality provides liquefied petroleum gas (propane)
service. 29
Currently, there are approximately 412 municipalities in Florida. 30 With the exception of Miami-Dade
County, the Legislature is authorized to establish or abolish municipalities or amend their charters by
general or special law. 31 In Miami-Dade County, the Board of County Commissioners has exclusive
authority to provide a method for establishing new municipalities and prescribing their jurisdiction and
powers. 32
Special Districts33
Special districts are separate governmental entities existing for specific purposes and having
substantial fiscal and administrative independence from general purpose governments. Special districts
have existed in the United States for over 200 years and are found in every state and the District of
Columbia.
In Florida, special districts perform a wide variety of functions, such as providing fire protection
services, delivering urban community development services, and managing water resources. Special
districts typically are funded through ad valorem taxes, special assessments, user fees, or impact fees.
The Uniform Special District Accountability Act, ch. 189, F. S., generally governs the creation and
21
FLA. CONST. art. VIII, s. l(g).
22 Id.
23
McLeod v. Orange County, 645 So. 2d 411, 413 (Fla. 1994); State ex rel. Volusia County v. Dickerson, 269 So. 2d 9, 11 (Fla. 1972).
24
See generally Local Government Formation Manual 2018-2020, Chapter 2.
25 FLA. CONST. art. VIII, s. 2(b).
26
S. 166.011, F.S.
27
Local Government Formation Manual 2018-2020, p. 16.
28
S. 166.021(4), F.S.
29
Clearwater Gas System, Services, Propane, hllps://www.clearwatergas.com/services/services/propane (last visited March 7, 2021).
30
See Local Government Formation Manual 2018-2020, Appendix E for a list of these cities and their dates of incorporation.
31 Local Government Formation Manual 2018-2020, p. 15.
32
FLA. CONST. art. VIII, s. 6(e), incorporating 1885 FLA. CONST. art. VIII, s. 11 (e).
33
See generally Local Government Formation Manual 2018-2020, Chapter 5.
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operations of special districts; however, other general laws may more specifically govern the operations
of certain types of special districts.
As of February 28, 2021, there are 628 active dependent34 special districts and 1, 158 active
independent special districts in Florida. 35 Community development districts are the most frequently
created form of independent special district. Other common special districts in Florida include drainage
and water control districts, fire control districts, and community redevelopment districts. 36 Currently, one
special electric district and four special natural gas districts exist in Florida. 37
Local Government Authority over Matters Related to Utility and Energy Services
Many of the powers granted to local governments by general law relate, directly or indirectly, to the
provision of utility or other energy services to property owners or utility customers in general or to the
authority of local governments to provide these services themselves. These powers include, but may
not be limited to, the authority to:
• Prepare and enforce comprehensive plans for development. 38
• Issue development permits and orders. 39
• Establish, coordinate, and enforce zoning and such business regulations as are necessary for
the protection of the public. 40
• Enforce the Florida Building Code and adopt and enforce local technical amendments thereto. 41
• Enter into contracts with utility companies or others for the supply of water, electricity, or
telephone service to or in connection with any project. 42
• Construct, operate, and maintain gas plants and distribution systems for domestic, municipal,
and industrial uses, 43 construct such other buildings and facilities as may be required to properly
and economically operate and maintain such works, 44 and make all necessary rules or
regulations governing the use, control and operation of such works; 45
• Contract with private companies for the right to construct, operate, and maintain gas plants and
distribution systems for domestic, municipal, and industrial uses, including the privilege or
franchise of exercising its corporate powers for such terms of years and upon such conditions
and limitations as may be deemed expedient and for the best interest of the municipality, for up
to 30 years, provided that the rates or charges to be made by the private company to the
individual users of the utility are fixed by the municipality. 46
• Provide and regulate roads, rights-of-way, and related transportation facilities. 47
• License the use of gas and power lines in rights-of-way. 48
• Adopt, revise, and amend, from time to time, appropriate ordinances, rules, and regulations
reasonably necessary to maintain air quality standards established pursuant to state and federal
law, including the federal Clean Air Act. 49
34
Dependent special districts are under some control by a single county or municipality, whereas independent special districts do not have any
dependent characteristics. A special district that includes more than one county is independent unless it lies wholly within the boundaries of a single
municipality.
35
Florida Department of Economic Opportunity, Division of Community Development, Special District Accountability Program, Official List of
Special Districts Online, Stale Totals, http://dca.deo.myflorida.com/fl1cd/sdip/O fficialListdeo/report.cfm (last visited Feb. 28, 2021).
36
Florida Department of Economic Opportunity, Division of Community Development, Special District Accountability Program, Official List of
Special Districts Online, Special District Function Totals at http://www.floridajobs.org/community-plannine,-and-development/assistancc-for-
govemments-and-organizations/special-distric1-accountabilily-progrnm (last visited Feb. 28, 2021 ).
37
See PSC, Facts & Figures of the Florida Utility Industry
http://www.psc.state. fl .us/Fi les/PDF/Publ icalions/Reports/General/Factsandfigures/ April%202020.pdf (last visited Feb. 28, 2021 ).
38
S. 125.0l(l)(g), F.S.
39
Ss. 125.022, F.S. and 166.033, F.S.
40
S. 125.0l(l)(h), F.S.
41 S. 125.0l(l)(bb), F.S.
42
S. 125.012(19), F.S.
43
S. 180.06(8), F.S.
44
S. 180.06(9), F.S.
45
S. 180.13, F.S.
46
S. 180.14, F.S.
47 S. 125.0l(l)(m), F.S.
48
S. 125.42, F.S.
49
S. 125.275, F.S.
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Further, general law provides a role for local governments in state proceedings related to the siting of
certain new electrical power plants, transmission lines, and natural gas pipelines. Specifically, part II of
ch. 403, F.S., requires local governments to provide a report to the Department of Environmental
Protection (DEP) as to the consistency of proposed electrical power plants, transmission lines, and
natural gas pipelines with all applicable local ordinances, regulations, standards, or criteria that apply to
the proposed facility, including local comprehensive plans, zoning regulations, land development
regulations, and any applicable local environmental regulations. 50
Municipalities are authorized to levy a public service tax on the purchase of electricity, natural gas
liquefied petroleum gas, and manufactured gas. 51
As noted above, many municipalities own and operate electric utilities and natural gas utilities and
govern the operation of those utilities through ordinance, code, or policies. These governing provisions
include terms of service, similar to those of non-governmental utilities, which restrict use of service
where unsafe conditions exist or when specified deposits or payments are not made. Some special
districts provide these services, likely under similar terms common to the industry.
State Preemption
Local governments have broad authority to legislate on any matter that is not inconsistent with federal
or state law. A local government enactment may be inconsistent with state law if (1) the Legislature
"has preempted a particular subject area" or (2) the local enactment conflicts with a state statute.
Where state preemption applies it precludes a local government from exercising authority in that
particular area. 52
Florida law recognizes two types of preemption: express and implied. Express preemption requires a
specific legislative statement; it cannot be implied or inferred. 53 Express preemption of a field by the
Legislature must be accomplished by clear language stating that intent. 54 In cases where the
Legislature expressly or specifically preempts an area, there is no problem with ascertaining what the
Legislature intended. 55 In cases determining the validity of ordinances enacted in the face of state
preemption, the effect has been to find such ordinances null and void. 56
Effect of the Bill
The bill prohibits a municipality, county, special district, or other political subdivision of the state from
enacting or enforcing a resolution, ordinance, rule, code, or policy, or take any action that restricts or
prohibits or has the effect of restricting or prohibiting a property owner, tenant, or utility service
customer from selecting his or her utility service. The bill provides that these utility services include
electric, manufactured gas, liquefied petroleum gas (propane), natural gas, hydrogen, fuel oil, a
renewable source, or any other source from a utility service provider that serves the affected property.
The bill defines a "utility service provider" as any person, public or private corporation, partnership,
association, or political subdivision that sells or supplies electricity or gas to the public.
50 Ss. 403.507(2)(a)3., F.S., s. 403.526(2)(a)5., F.S., ands. 403.941, F.S.
51
S. 166.231, F.S.
52
Wolf, The Effectiveness of Home Rule: A Preemptions and Conflict Analysis, 83 Fla. B.J. 92 (June 2009). Historically, certain types oflocal action
have been found to frustrate the purpose of state law, and, thus, conflict has resulted. Specifically, Florida jurisprudence makes clear that local action
cannot 1) provide for more stringent regulation than the state legislation in violation of the express wording of the statute; 2) provide for a more
stringent penalty than that allowed by state statute; 3) prohibit behavior otherwise allowed by state legislation; 4) allow behavior otherwise prohibited
by state statute; or 5) provide for a different method for doing a particular act than the method proscribed by state legislation.
Generally, a local government can pass more stringent regulations than those provided for by statute. However, if the state legislation expressly
forbids a stricter regulation or if the imposition ofa stricter regulation frustrates the purpose of the statute, the local government must abstain
53
See City of Hollywood v. Mulligan, 934 So. 2d 1238, 1243 (Fla. 2006); Phantom of Clearwater, inc. v. Pinellas County, 894 So. 2d 1011, 1018
(Fla. 2d DCA 2005), approved in Phan/om of Brevard, inc. v. Brevard County, 3 So. 3d 309 (Fla. 2008).
54
Mulligan, 934 So. 2d at 1243.
55
Sarasota Alliance for Fair Elections, inc. v. Browning, 28 So. 3d 880, 886 (Fla. 2010).
56
See, e.g., Nat 'l Rifle Ass 'n ofAm., inc. v. City ofS. Miami, 812 So.2d 504 (Fla. 3d DCA 2002).
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The bill provides that it does not restrict a municipality's power to levy a public services tax under
existing law 57 or to receive revenue from any public utility. 58
The bill provides that any municipality, county, special district, or political subdivision charter,
resolution, ordinance, rule, code, policy, or action that is preempted by this act that existed before or on
July 1, 2021, is void.
B. SECTION DIRECTORY:
Section 1 Creates s. 377.707, F.S.; providing a definition; providing legislative findings; intent;
prohibiting a local government from regulating energy infrastructure; preempting such
regulation to the state.
Section 2 Provides for an effective date.
II. FISCAL ANALYSIS & ECONOMIC IMPACT STATEMENT
A. FISCAL IMPACT ON STATE GOVERNMENT:
1. Revenues:
None.
2. Expenditures:
None.
B. FISCAL IMPACT ON LOCAL GOVERNMENTS:
1. Revenues:
Indeterminate. See Fiscal Comments.
2. Expenditures:
Indeterminate. See Fiscal Comments.
C. DIRECT ECONOMIC IMPACT ON PRIVATE SECTOR:
Indeterminate. See Fiscal Comments.
s7 S. 166.231, F.S., authorizes municipalities to levy a tax on the purchase of electricity, metered natural gas, liquefied petroleum gas either metered
or bottled, manufactured gas either metered or bottled, and water service. Generally, the tax may be levied only upon purchases within the
municipality and may not exceed 10 percent.
ss S. 366.02(1), F.S., defines a "public utility" as "every person, corporation, partnership, association, or other legal entity and their lessees, trustees,
or receivers supplying electricity or gas (natural, manufactured, or similar gaseous substance) to or for the public within this state." The term "public
utility" does not include rural electric cooperatives, municipal electric utilities, special natural gas districts, natural gas transmission pipeline
companies, natural gas marketers, or propane suppliers.
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D. FISCAL COMMENTS :
Due to uncertainty as to the specific impact of the bill's preemption provisions, the potential fiscal
impacts to local government and the direct economic impact on the private sector cannot be
determined.
Ill. COMMENTS
A. CONSTITUTIONAL ISSUES :
1. Applicability of Municipality/County Mandates Provision:
Not Applicable. This bill does not appear to require counties or municipalities to spend funds or take
action requiring the expenditures of funds; reduce the authority that counties or municipalities have
to raise revenues in the aggregate; or reduce the percentage of state tax shared with counties or
municipalities.
2. Other:
None.
B. RULE-MAKING AUTHORITY:
None.
C. DRAFTING ISSUES OR OTHER COMMENTS :
The bill defines a "utility service provider" to include any entity that sells or supplies electricity or gas to
the public within this state. The bill also provides a list of utility services from which a local government
may not prohibit a "utility service customer" from selecting. In addition to electricity and various forms of
gas, this list includes "hydrogen, fuel oil, a renewable source, or any other source from a utility service
provider that serves the affected property." Many of these energy sources cannot be separately
selected when purchasing from a utility service provider, as defined in the bill . Thus, this list is
inconsistent with this bill's definition of "utility service provider."
The bill creates a broad preemption over any actions of local governments in relation to a customer's
choice of utility service. Other than an exception for municipal public service taxes, the bill does not
provide for local governments to exercise powers granted by general law, such as permitting and code
enforcement, to the extent that the exercise of those powers may be construed to have the effect of
restricting a customer's choice of utility service. Further, a local government that owns and operates a
utility may not be able to adopt or enforce ordinances, codes, or policies providing requirements for
persons who wish to receive service, including restrictions on connection of service to a property where
unsafe conditions exist or when specified deposits or payments are not made.
IV. AMENDMENTS/ COMMITTEE SUBSTITUTE CHANGES
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FLORIDA H O U S E 0 F REPRESENTATIVES
HB 919 2021
1 A bill to be entitled
2 An act relating to preemption over restriction of
3 utility services; creating s. 366.032, F.S.; defining
4 the term "utility service provider"; prohibiting
5 municipalities, counties, special districts, or other
6 political subdivisions from restricting or prohibiting
7 customers from selecting their utility service;
8 authorizing municipalities to levy taxes on public
9 services; voiding existing specified documents and
10 policies that are preempted by this act; providing an
11 effective date.
12
13 Be It Enacted by the Legislature of the State of Florida:
14
15 Section 1. Section 366.032, Florida Statutes, is created
16 to read:
17 366.032 Definition; preemption over utility service
18 restrictions.-
19 (1) As used in this section, the term "utility service
20 provider" means any person, any corporation, whether public or
21 private, any partnership, any association, or any political
22 subdivision, whether a municipality, county, special district,
23 or other political subdivision that sells or supplies
24 ele ctric ity or gas to the public within this state.
25 (2) A municipality, county, special district, or other
Page 1 of 2
CODING: Words strisken are deletions; words underlined are additions.
hb0919-00
FLORIDA H O U S E 0 F REPRESENTATIVES
HB 919 2021
26 political subdivision of the state may not enact or enforce a
27 resolution, ordinance, rule, code, policy 1 or take any action
28 that restricts or prohibits or has the effect of restricting or
29 prohibiting a property owner, tenant, or utility service
30 customer from selecting his or her utility service, whether
31 electric, manufactured gas, liquefied petroleum gas, natural
32 gas, hydrogen, fuel oil, a renewable source, or any other source
33 from a utility service provider that serves the affected
34 property. However, nothing in this section restricts a
35 municipality the right and power to levy taxes on public
36 services under s. 166.231 or affect the right of any
37 municipality to receive revenue from any public utility.
38 Section 2. Any municipality, county, special district, or
39 political subdivision charter, resolution, ordinance, rule,
40 code, policy, or action that is preempted by this act that
41 existed before or on July 1, 2021, is void.
42 Section 3. This act shall take effect July 1, 2021 .
Page 2 of 2
CODING: Words strioken are deletions; words underlined are additions.
hb0919-00
TOURISM, INFRASTRUCTURE & ENERGY SUBCOMMITTEE
HB 919 by Rep. Tomkow
PREEMPTION OVER RESTRICTION OF UTILITY SERVICES
AMENDMENT SUMMARY
MARCH 11, 2021
Amendment 1 by Rep. Tomkow
• Prohibits a municipality, county, special district, or other political subdivision of
the state from enacting or enforcing a resolution, ordinance, rule, code, or policy
or taking any other action that restricts or prohibits or has the effect of restricting
or prohibiting the types or fuel sources of energy production which may be used,
delivered, converted, or supplied by specified electric and natural gas utilities,
entities formed by interlocal agreement to generate and transmit electricity,
natural gas transmission companies, and propane dealers, dispensers, and gas
cylinder exchange operators.
• Provides that the bill may not be construed to alter current Public Service
Commission jurisdiction.
• Removes an exception for levying public services taxes.
• Removes a definition for the term “utility service provider” and removes
references to that term.
COMMITTEE/SUBCOMMITTEE AMENDMENT
Bill No. HB 919 (2021)
Amendment No. 1
COMMITTEE/SUBCOMMITTEE ACTION
ADOPTED (Y/N)
ADOPTED AS AMENDED (Y/N)
ADOPTED W/O OBJECTION (Y/N)
FAILED TO ADOPT (Y/N)
WITHDRAWN (Y/N)
OTHER
1 Committee/Subcommittee hearing bill: Tourism, Infrastructure &
2 Energy Subcommittee
3 Representative Tomkow offered the following:
4
5 Amendment (with title amendment)
6 Remove lines 17-37 and insert:
7 366.032 Preemption over utility service restrictions.-
8 (1) A municipality, county, special district, or other
9 political subdivision of the state may not enact or enforce a
10 resolution, ordinance, rule, code, policy, or take any action
11 that restricts or prohibits or has the effect of restricting or
12 prohibiting the types or fuel sources of energy production which
13 may be used, delivered, converted, or supplied by a public
14 utility or an electric utility as defined in this chapter, an
15 entity formed under ch. 163.01 that generates, sells, or
16 transmits electrical energy, a natural gas utility as defined in
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Page 1 of 2
COMMITTEE/SUBCOMMITTEE AMENDMENT
Bill No. HB 919 (2021)
Amendment No. 1
17 s. 366.04(3)(c), a natural gas transmission company as defined
18 in ch. 368, or a Category I liquefied petroleum gas dealer or
19 Category II liquefied petroleum gas dispenser or Category III
20 liquefied petroleum gas cylinder exchange operator as defined in
21 ch. 527 to customers such entities are authorized to serve.
22 (2) This section may not be construed to expand or alter
23 the jurisdiction of the commission over public utilities or
24 electric utilities.
25
26 -----------------------------------------------------
27 T I T L E A M E N D M E N T
28 Remove lines 3-9 and insert:
29 utility services; creating s. 366.032, F.S.; prohibiting
30 municipalities, counties, special districts, or other political
31 subdivisions from restricting or prohibiting the types or fuel
32 sources of energy production used, delivered, converted, or
33 supplied by certain entities to customers; providing for
34 construction; voiding existing specified documents and
534993 - h0919-line17.docx
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HOUSE OF REPRESENTATIVES STAFF ANALYSIS
BILL#: HB 1143 Funding of Aviation Development Projects
SPONSOR(S): Grall
TIED BILLS: IDEN./SIM. BILLS: SB 1466
REFERENCE ACTION ANALYST STAFF DIRECTOR or
BUDGET/POLICY CHIEF
1) Tourism , Infrastructure & Energy Subcommittee
2) Infrastructure & Tourism Appropriations
Subcommittee
3) Commerce Committee
SUMMARY ANALYSIS
Under federal regulations, commercial service airports are categorized into large hub, medium hub, small hub,
and non-hub airports, based upon the number of passenger boardings in a given year.
Under Florida law, when federal funds are not available, the Department of Transportation (DOT) may fund up
to 80 percent of the costs for certain projects at airports that do not have any scheduled commercial service.
DOT may only fund up to 50 percent of the project cost if the airport has scheduled commercial service.
The bill authorizes DOT to fund up to 80 percent of the costs for eligible airport projects, with a 20 percent local
match at all publicly-owned, public-use general aviation airports and commercial service airports not classified
as large hub, medium hub, or small hub airports by the Federal Aviation Administration (FAA).
Under the bill, eligible projects at the following commercial service airports could receive DOT funding of up to
80 percent of the project costs with a 20 percent local match: Daytona Beach International, Gainesville
Regional, Melbourne International, Tallahassee International, and Vero Beach Regional Airports.
The bill has an indeterminate impact on state government expenditures and no impact on state government
revenues or local government revenues or expenditures. The bill will increase the opportunity for certain
airports to engage in state-funded aviation projects. See Fiscal Analysis for details.
The bill has an effective date of July 1, 2021 .
This document does not reflect the intent or official position of the bill sponsor or House of Representatives.
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DATE: 3/9/2021
FULL ANALYSIS
I. SUBSTANTIVE ANALYSIS
A EFFECT OF PROPOSED CHANGES:
Current Situation
Airport Oversight
At the federal level, the Federal Aviation Administration (FAA) is responsible for planning and
developing a safe and efficient national airport system. This includes all programs related to airport
safety and inspections and standards for airport design, construction, and operation. Federal law
requires each commercial service airport to operate under a federal certificate and comply with federal
aviation requirements. The FAA is responsible for national airport planning and environmental and
social requirements and establishes policies related to airport rates and charges, compliance with grant
assurances, and airport privatization. 1
In Florida, the Department of Transportation (DOT) is responsible for planning airport systems and
promoting the further development and improvement of airport facilities. 2 The owner or lessee of a
proposed public airport3 must receive DOT approval before site acquisition, construction, or
establishment of a public airport facility. 4 DOT is also responsible for licensing public airport facilities
before the operation of aircraft to or from the facility and must inspect such facilities prior to licensing or
license renewal. 5 Florida law authorizes local governments to establish and operate airports6 and
governs airport zoning and land use issues. 7
Airport Categories
Under federal regulations, a commercial service airport is defined as a public airport that the FAA
determines has at least 2,500 commercial passenger boardings each year and is receiving scheduled
passenger service. 8 A large hub airport is a commercial service airport that has at least 1 percent of the
commercial passenger boardings in United States. 9 A medium hub airport is a commercial service
airport that has at least 0.25 percent but less than 1 percent of the commercial passenger boardings in
the United States. 10 A small hub airport is a commercial service airport that has at least 0.05 percent
but less than 0.25 percent of the commercial passenger boardings in the United States. 11 A non-hub
airport has less than 0.05 percent of all commercial passenger boardings in the United States but has
more than 10,000 passenger boardings. 12
1
See Federal Aviation Administration, Airports, https://www.faa.gov/about/office_ org/headquarters_ offices/arp/ (last visited on
March 5, 2021).
2
S. 332.001. F.S.
3
Section 330.27(6), F.S. For purposes of DOT approval and licensure, the term "public airport" means an airport, publicly or privately
owned, which is open for use by the public.
4
S. 330.30(1), F.S.
5
S. 330.30(2), F.S.
6
See Ch. 332, F.S.
7
See Ch. 333, F.S.
8
49 U.S.C. § 47102(7).
9
49 U.S.C. § 47102(11). Florida's large hub airports are Miami International, Orlando International, Ft. Lauderdale/Hollywood
International, and Tampa International.
10
49 U.S.C. § 47102(13). Florida's medium hub airports are Southwest Florida International (Ft. Myers), Palm Beach International,
and Jacksonville International.
11
49 U.S.C. § 47102(25). Florida's small hub airports are Orlando Sanford International, St. Pete-Clearwater International, Pensacola
International, Sarasota/Bradenton International, Northwest Florida-Beaches International (Panama City), Punta Gorda, Destin-Ft.
Walton Beach, and Key West.
12
49 U.S.C. § 47102(14). Florida's non-hub airports are Tallahassee International, Daytona Beach International, Melbourne
International, and Gainesville Regional.
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Nonprimary airports are commercial service airports that have at least 2,500 and no more than 10,000
passenger boardings each year. 13 Primary airports are commercial service airports that have more than
10,000 passenger boardings each year. 14
Federal Airport Funding
At the federal level, airports receive federal grants administered by the FM. The main grant program
for federal funds is the Airport Improvement Program (AIP). The AIP provides grants to public agencies
- and, in some cases, to private owners and entities - for the planning and development of public-
use airports. 15
Eligible AIP projects include airport improvements related to enhancing airport safety, capacity,
security, and environmental concerns. In general, airports may receive AIP funds for most airfield
capital improvements or rehabilitation projects and, in some specific situations, for terminals, hangars,
and nonaviation development. Certain professional services that are necessary for eligible projects may
also be eligible. The FM must be able to determine that the projects are justified based on civil
aeronautical demand. The projects must also meet federal environmental and procurement
requirements. 16
State Airport Funding
Sections 332.003 through 332.007, F.S., create the Florida Airport Development and Assistance Act
(Act). The act provides the following duties of the Department of Transportation (DOT):
• Provide coordination and assistance for the development of a viable aviation system.
• Advise and assist the Governor in all aviation matters.
• Upon request, assist airport sponsors in airport master planning.
• Upon request, provide financial and technical assistance to public agencies which operate
public-use airports 17 by making DOT resources available on a cost-reimbursement basis to such
agencies for special needs of limited duration.
• Participate in research and development programs relating to airports.
• Administer DOT's participation in the program of aviation and airport grants.
• Develop, promote, and distribute supporting information and educational services.
• Encourage the maximum allocation of federal funds to local airport projects in this state.
• Support the development of land located within the boundaries of airports for the purpose of
industrial or other uses compatible with airport operations. 18
Section 332.007, F.S., relates to the administration and financing of aviation and airport programs and
projects. DOT must prepare and continuously update an aviation and airport work program based on a
collection of the local sponsors' 19 proposed projects to be included in DOT's work program. 20 DOT's
airport work program must separately identify development projects and discretionary capacity
improvement projects. 21 DOT's airport work program must be consistent with the statewide aviation
system plan and, to the maximum extent feasible, consistent with approved local government
13
See Federal Aviation Administration, Airports, Planning and Capacity, Airport Categories,
https://www.faa.gov/airports/planning_capacity/categories/ (last visited on February 24, 2021 ). Florida's only non primary airport is
Vero Beach Regional Airport.
14 Id.
15
See Federal Aviation Administration, Airports, Airport Improvement Program (AIP), Overview: What is AIP?
https://www.faa.gov/airports/aip/overview/ (last visited on February 24, 2021).
16
Department of Transportation, Agency Analysis of202 l House Bill 1143, p. 4. (February 25, 2021).
17
Section 332.004(14), F.S., defines the term "public-use airport" as any publicly owned airport which is used or to be used for public
purposes.
18
S. 332.006, F.S.
19
Section 332.004(15), F.S., defines the term "sponsor" as any eligible agency which, either individually or jointly with one or more
eligible agencies, submits to the department an application for financial assistance for an airport development project in accordance
with this act.
20
DOT's work program is developed pursuant to s. 339.135, F.S.
21
S. 332.007(2)(a), F.S.
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comprehensive plans. Projects involving DOT-administered funds to be undertaken and implemented
by the airport sponsor must be included in the aviation and airport work program. 22 Assistance may
only be provided for projects which are included in the department's adopted work program. 23
Only projects or programs provided for in the Act that will contribute to the implementation of the state
aviation system plan, that are consistent with and will contribute to the implementation of any airport
master plan or layout plan, and that are consistent, to the maximum extent feasible, with the approved
local government comprehensive plans are eligible for the expenditure of state funds in accordance
with fund participation rates and priorities. 24
Subject to appropriations, DOT may fund up to 50 percent of the portion of eligible airport project costs
which are not funded by the federal government, except that DOT may initially fund up to 75 percent of
the cost of land acquisition for a new airport or for the expansion of an existing airport which is owned
and operated by a municipality, a county, or an authority. 25
However, subject to appropriation, DOT may help fund the capital cost of eligible public airport and
aviation development projects at a higher rate for various types of projects. When federal funds are not
available, DOT may fund up to 80 percent of master planning and eligible aviation development
projects at publicly owned, publicly operated airports. If federal funds are available, DOT may fund up
to 80 percent of the nonfederal share of such projects. Such funding is limited to airports that have no
scheduled commercial service. 26
DOT requires statutory compliance via assurances included with each grant agreement. The agency
certifies that, with respect to a project, it will comply, within its authority, with all applicable, current laws
and rules of the state and local government, as well as DOT policies, guidelines, and requirements.
The sponsor also certifies, with respect to a construction-related project, that all design plans and
specifications will comply with applicable federal, state, local, and professional standards, as well as
FAA advisories and FAA issued waivers. Failure by the agency to satisfactorily remedy the non-
compliance absolves DOT's continued financial commitment to the project and immediately requires
the agency to repay DOT the full amount of funds expended by DOT on a project. 27
Effect of the Bill
The bill authorizes DOT to fund up to 80 percent of the costs for eligible airport projects, with a 20
percent local match, at all publicly-owned, public-use general aviation airports and commercial service
airports not classified as large hub, medium hub, or small hub by the FAA. Thus commercial service
airports with less than approximately 470,000 passenger boardings per year will qualify for this
funding. 28 This number will change over time with the number of passenger boardings at United States
airports.
Based on current passenger boardings, the bill would allow DOT to fund eligible projects at up to 80
percent with a 20 percent local match at the following commercial service airports: Daytona Beach
International, Gainesville Regional, Melbourne International, Tallahassee International, and Vero Beach
Regional airports.
The bill has an effective date of July 1, 2021 .
22
S. 332.007(2)(b), F.S.
23
S. 332.007(3), F.S.
24
S. 332.007(5), F.S.
25
S. 332.006(6)(a), F.S.
26
S. 332.007(6)(c), F.S.
27
Florida Department of Transportation, Agency Analysis of 2021 House Bill 1143.
28
FAA. Commercial Service Airports (Rank Order) based in Calendar Year 2019, September 25, 2020.
https://www.faa.gov/airports/planning_capacity/passenger_all cargo_stats/passenger/media/cy 19-commercial-service-
enplanements. pdf (last visited March 9, 2020).
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B. SECTION DIRECTORY:
Section 1 Amends s. 332.007, F.S., relating to the administration and financing of airport programs
and projects.
Section 2 Provides an effective date of July 1, 2021 .
II. FISCAL ANALYSIS & ECONOMIC IMPACT STATEMENT
A. FISCAL IMPACT ON STATE GOVERNMENT:
1. Revenues:
None.
2. Expenditures:
lndeterminate. 29
B. FISCAL IMPACT ON LOCAL GOVERNMENTS:
1. Revenues:
None.
2. Expenditures:
None.
C. DIRECT ECONOMIC IMPACT ON PRIVATE SECTOR:
None.
D. FISCAL COMMENTS:
The bill changes the match requirement for certain commercial service airport projects for DOT aviation
funds. This change will impact the opportunity of these airports to engage in these projects. However,
the impact of the match is indeterminate.
Ill. COMMENTS
A. CONSTITUTIONAL ISSUES:
1. Applicability of Municipality/County Mandates Provision:
Not applicable. This bill does not appear to require counties or municipalities to spend funds or take
action requiring the expenditure of funds; reduce the authority that counties or municipalities have to
raise revenues in the aggregate; or reduce the percentage of sales tax shared with counties or
municipalities.
2. Other:
None.
29 Florida Department of Transportation, Revised Agency Analysis of HB 1143, p. 6.
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B. RULE-MAKING AUTHORITY:
The bill does not require rulemaking, nor does it provide a grant of rulemaking authority.
C. DRAFTING ISSUES OR OTHER COMMENTS:
None.
IV. AMENDMENTS/ COMMITTEE SUBSTITUTE CHANGES
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FLORIDA H O U S E 0 F REPRESENTATIVES
HB 1143 2021
1 A bill to be entitled
2 An act relating to funding of aviation development
3 projects; amending s. 332.007, F.S.; providing that
4 specified funding of aviation development projects is
5 limited to general aviation airports or commercial
6 service airports under certain circumstances;
7 providing an effective date.
8
9 Be It Enacted by the Legislature of the State of Florida:
10
11 Section 1. Paragraph (c) of subsection (6) of section
12 332.007, Florida Statutes, is amended to read:
13 332.007 Administration and financing of aviation and
14 airport programs and projects; state plan.-
15 (6) Subject to the availability of appropriated funds, the
16 department may participate in the capital cost of eligible
17 public airport and aviation development projects in accordance
18 with the following rates, unless otherwise provided in the
19 General Appropriations Act or the substantive bill implementing
20 the General Appropriations Act:
21 (c) When federal funds are not available, the department
22 may fund up to 80 percent of master planning and eligible
23 aviation development projects at publicly owned, publicly
24 operated airports. If federal funds are available, the
25 department may fund up to 80 percent of the nonfederal share of
Page 1 of 2
CODING: Words striskeR are deletions; words underlined are additions.
hb1143-00
FLORIDA H O U S E 0 F REPRESENTATIVES
HB 1143 2021
26 such projects. Such funding is limited to general aviation
27 airports, or commercial service airports that a r e not classified
28 as large, medium, or small hub airports by the Federal Aviation
29 Administration have no scheduled coffiffiercial service.
30 Section 2. This act shall take effect July 1, 2021.
Page 2 of 2
CODING: Words striskoA are deletions; words underlined are additions.
hb1143-00
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HOUSE OF REPRESENTATIVES STAFF ANALYSIS
BILL#: PCS for HB 387 Property Assessed Clean Energy Program
SPONSOR(S): Tourism, Infrastructure & Energy Subcommittee
TIED BILLS: IDEN./SIM. BILLS: SB 1208
REFERENCE ACTION ANALYST STAFF DIRECTOR or
BUDGET/POLICY CHIEF
Orig. Comm.: Tourism, Infrastructure & Energy Willson (v\\J Keating Cf_,
Subcommittee
SUMMARY ANALYSIS
In 2010, the Legislature provided specific authority for local governments to create Property Assessed Clean
Energy (PACE) programs to provide up-front financing for certain qualifying improvements. Under these
programs, property owners may apply to the local government for funding to finance a qualifying improvement
and voluntarily enter into a financing agreement with the local government. "Qualifying improvements" include
energy conservation and efficiency improvements, renewable energy improvements, and wind resistance
improvements to existing facilities. Property owners finance qualifying improvements through a non-ad valorem
assessment on their property. Local governments determine whether to offer a residential or commercial PACE
program, whether to administer the program directly or through a for-profit or not-for-profit administrator, or any
combination thereof.
The bill adds several consumer protections relating to the current PACE program, including:
• Specifying that a financing agreement may not be used to fund unnecessary ancillary work.
• Capping the total of all non-ad valorem assessments, plus any mortgage-related debt on the property, at
97% of a residential property's fair market value.
• Requiring a determination that a residential property owner is able to pay the assessment and meets certain
minimum creditworthiness requirements.
• Allowing property owners to cancel a financing agreement within 3 days of execution.
• Requiring verification that any mortgage holders or loan servicers with an interest secured by the property
have received notice of the assessment.
• Ensuring that financing agreements do not exceed the estimated useful life of the qualifying improvement.
• Requiring acknowledgement of a number of key terms and disclosures, both orally and in writing, before
execution of the financing agreement by the property owner.
• Requiring licensure and background screening for contractors who install qualifying improvements under a
PACE program.
• Requiring verification that the work was completed to code before funds are disbursed.
• Imposing of certain marketing and communication guidelines, including limitations and prohibitions on
solicitation, advertising, and other inducements.
• Specifying terms relating to enforceability of contracts for qualifying improvements and associated remedies.
The bill also requires the local government to post an online annual report documenting certain PACE
activities.
The bill does not have a fiscal impact on state government. The bill does not appear to impact local
government revenues, but may have an insignificant negative fiscal impact on local government expenditures .
The bill takes effect on July 1, 2021 .
This document does not reflect the intent or official position of the bill sponsor or House of Representatives.
STORAGE NAME: pcs0387.TIE.D0CX
DATE: 3/10/2021
FULL ANALYSIS
I. SUBSTANTIVE ANALYSIS
A. EFFECT OF PROPOSED CHANGES:
Current Situation
Property Assessed Clean Energy (PACE) Programs
Generally, Property Assessed Clean Energy (PACE) programs enable local governments to establish
programs to provide financing for certain qualifying improvements on real property which reduce energy
consumption and increase energy efficiency. PACE allows individual property owners to contract
directly with qualified contractors for energy efficiency and renewable energy projects . The local
government provides the upfront funding for projects from the proceeds of a revenue bond issuance,
which are repaid by non-ad valorem assessments on participating property owners' tax bills. 1 The first
residential PACE program was launched in 2008 in Berkeley and Palm Desert, California. 2 PACE
programs are active in 24 states plus Washington D.C., but only California, Florida, and Missouri offer
residential PACE programs .3
PACE in Florida
In 2010, the Legislature provided specific authority for local governments to create PACE programs.4
Section 163.08, F.S., provides supplemental authority to local governments5 concerning qualified
improvements to residential and non-residential real property. The law provides that if a local
government authorizes a PACE program, property owners may apply to the local government for
funding to finance a qualifying improvement and voluntarily enter into a financing agreement with the
local government. 6 "Qualifying improvements" include energy conservation and efficiency
improvements, renewable energy improvements, and wind resistance improvements to existing
facilities. 7
At least 30 days before entering into the financing agreement, the property owner must provide notice
to any mortgage holder or loan servicer of the intent to enter into the agreement, the maximum amount
to be financed, and the maximum annual assessment that will be required to repay the amount. 8 The
law provides that an acceleration clause for "payment of the mortgage, note, or lien or other unilateral
modification solely as a result of entering into a financing agreement ... is not enforceable." 9 However,
the mortgage holder or loan servicer may increase the required monthly escrow by an amount
necessary to annually pay the qualifying improvement assessment.
The law authorizes a local government to partner with one or more local governments for the purpose
of providing and financing qualifying improvements, levy a non-ad valorem assessment to fund a
qualifying improvement, incur debt to provide financing for qualifying improvements, and collect costs
1
For more information, See hnp://, ww.paccnation .org and llltp://tloridapace.go / (last visited Mar. 7, 2021).
2 NCSL, PACE Financing hltps://wwvrncsl.org/reset1rch/encrgv/pace-linancing.aspx (last visited Mar. 7, 2021).
3 California offers residential PACE financing for improvements related to electric vehicle charging, infrastructure, energy efficiency, renewable
energy, seismic strengthening and water efficiency. Missouri offers PACE financing for improvements related to energy efficiency and renewable
energy. Additionally, Maine offers residential programs without holding a lien against properties. NCSL, A Clean-Energy Financing Program for
Homeowners Now Has Tougher Consumer Protections (Nov. 17, 2017) hllps://www.nc 1.org/bookstorc/slate-legislatures-maeazine/c lcan-energy-
finan cing-consumer-prOLection.aspx. See also PACE Nation, PACE Programs hltps://, ww.paccnal'ion.org/pace-programs/ (last visited Mar. 9,
2021).
4
h. 20 I0- 139, Laws of Fla.
5 Section l63.08(2)(a), F.S., defines "local government" as a county, a municipality, a dependent special district as defined ins. 189.012, or a
separate legal entity created pursuant to s. 163.01(7) [known as the Florida lnterlocal Cooperation Act] ."
6 S. 163.08(4), F.S. ·
7
S. l63.08(2)(b), F.S.
8 S. 163.08(13), F.S.
9
S. 163.08(15), F.S.
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incurred from financing qualifying improvements through a non-ad valorem assessment. These non-ad
valorem assessments are senior to existing mortgage debt, so if the homeowner defaults or goes into
foreclosure, the delinquent payments would be recovered before the mortgage. Current law also
specifies that a PACE program may be administered by a for-profit entity or a not-for-profit organization
on behalf of and at the discretion of the local government.
In 2012, the Legislature expanded the definition of "local government" to allow a partnership of local
governments formed pursuant to the Florida lnterlocal Cooperation Act, 10 to enter into a financing
agreement wherein the partnership, as a separate legal entity, imposes the PACE assessment. 11
To participate in a PACE program, a property owner must have paid property taxes and not been
delinquent for the previous three years.12 The total assessment cannot be for an amount greater than
20 percent of the just value of the property as determined by the county property appraiser, unless
consent is obtained from the mortgage holders.13
In Florida, local governments typically have multiple non-exclusive agreements with a number of PACE
providers. 14 Generally, PACE providers are private companies that administer the local government's
PACE program on behalf of the local government and provide funding from private sources. PACE
providers generally act as the program administrator for special districts created pursuant to an
interlocal agreement between two or more Florida local governments. Once the PACE district is
created, additional counties or municipalities may join the special district as members, authorizing the
PACE provider for the special district to administer PACE programs on behalf of the newly joined
members. 15 PACE providers generally maintain a list of approved contractors authorized to provide
qualifying improvements. 16
For example, Broward County authorizes the following PACE providers:17
• CounterPointe Energy Solutions provides financing under the "AllianceNRG" Program
(residential) and the "CounterpointeSRE" Program (commercial) . Administers PACE program
for the Florida PACE Funding District.
• Berkadia administers a commercial PACE program. Administers program for the Florida
Renewable Energy District.
• CleanFund administers a commercial PACE program. Administers program for the Florida
Renewable Energy District.
• Dividend Finance administers the "Dividend" Program. Administers PACE program for the
Florida Renewable Energy District.
• Greenworks Lending administers a commercial PACE program . Administers program for the
Florida Renewable Energy District.
• Lever Energy Capital administers a commercial PACE program. Administers program for the
Florida Resiliency and Energy District.
• PACE Funding Group, LLC administers the "PACEfunding" Program (residential). Administers
program for the Florida Resiliency and Energy District.
• Rahill administers a commercial PACE program. Administers program for the Florida Resiliency
and Energy District.
10
S. 163.01(7), F.S.
11 Ch. 2012-117, Laws of Fla.
12 S. 163 .08(9), F.S.
13 S. 163 .08(12)(a), F.S.
14 http ://lloridapa e.gov/serv iccareas/
15 See Green Corridor Property Assessed Clean Energy (PACE) District Town of Cutler Bay, Florida Financial Report for the Fiscal Year Ended
Sept. 30, 2014, at 13.
https://naud itor.gov/pages/specialdistrlct. cfi le%20rpts/20 I 4%20green%20corridor%20propertv%20asscssed%20clean%20energv%20(pace}%20di
strict.pdf (last visited Mar. 9, 2021 ).
16 See Sarasota County, PACE, https://w1 w.scgov.net/government/uf-ifas-cxlen ion-and-su tai nabil ity/pace (last visited Mar. 9, 2021)
17 Broward County, Energy & Sustainability Program: Property Assessed Clean Energy (PACE)
https://1V\ w.brownrd .org/C li mate/EncreyAnd, ustainab ilitvProg_ram/pages/pace.asp.x (last visited Mar. 9, 2021 ).
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DATE: 3/10/2021
• Renew Financial administers PACE programs under the "RenewPACE" Program (residential
and commercial). Administers program for the Florida Green Finance Authority.
• Structured Finance Associates administers a commercial PACE program. Administers program
for the Florida Renewable Energy District.
• Renovate America administers the "HERO" Program.
• Twain Financial Partners administers a commercial PACE program. Administers program for
the Florida Resiliency and Energy District.
• Ygrene administers the "Clean Energy Program" (residential and commercial). Administers
program for the Clean Energy Green Corridor Pace District. 18
It is up to the local government to determine whether to offer a residential or commercial PACE
program, whether to administer the program directly or through a third-party PACE provider, or any
combination thereof.
Currently, PACE financing typically offers an average interest rate of 6-8%, not including additional
associated fees, which is repaid over a term of 15 to 20 years. Interest rates and fees for a project are
set by the PACE provider when the agreement is finalized with the property owner. 19
Federal Housing Finance Agency and Super-Priority Liens
In 2010, 20 and again in 2014 2 1, the Federal Housing Finance Agency (FHFA) directed mortgage
underwriters Fannie Mae and Freddie Mac not to purchase mortgages of homes encumbered by a first-
lien PACE loan due to its senior status above a mortgage. Under normal circumstances, real estate lien
priority is established by the order in which the liens are filed. 22
According to the FHFA, such super-priority liens increases the risk of losses to taxpayers. Fannie Mae
and Freddie Mac support the housing finance market by purchasing, guaranteeing, and securitizing
single-family mortgages. Therefore, mortgages supported by Fannie Mae and Freddie Mac must
remain in first-lien position, meaning that they have first priority in receiving the proceeds from the sale
of a house in foreclosure. Although FHFA generally supports energy retrofit financing programs, the
Agency acknowledges that such programs need to be structured in a manner which ensures protection
of the core financing for the home. 23
18
See PACE Broward, Frequently Asked Questions
https://www.broward.org/C! imate/ nergyAnd ustainabilityProe.ram/ Documcnts/ PACE%20Broward%20FA0%20Shee! Update4 09212018.pdf
(last visited Mar. 9, 2021 ).
19
Palm Beach County, PA CE Frequently Asked Questions https://discover.pbcgov.org/resi Iicnce/Pagcs/P ACE-Freq uently-Asked-Oucstions.aspx
(last visited Mar. 9, 2021 ).
°
2
Federal Housing Finance Agency, FHFA Statement on Certain Energy Retrofit Loan Programs (July, 6, 2010),
hllp://www.1l1la. gov/Mcdia/PublicAffalrs/Pages/FI-IFA-Statemenl-on-Ccrtain-Energv-Rotroli1-Loan-Progmms.aspx (last visited Mar. 7, 2021 ). See
also Federal Housing Financial Agency, Statement of the Federal Housing Finance Agency on Certain Super Priority Liens (December 22,
2014 )("FHF A wants to make clear to homeowners, lenders, other financial institutions, state officials, and the public that Fannie Mae and Freddie
Mac's policies prohibit the purchase ofa mortgage where the property has a first-lien PACE loan attached to it")
http://\ ww.ll1fo.gov/Media/PublicAffairs/Pagcs/StatemenL-ol~thc-Fcderal-Housing-Financc-Agcncy-on-Ccriain-Supcr-Priorily-Liens.aspx (last
visited Mar. 7, 2021).
21
FHF A, Statement ofthe Federa/ Housing Finance Agency on Certain Super-Priority Liens (Dec. 22, 2014)
https://www. fh fa. gov/ Med ia/Publ icA ffai rs/Pagcs/Statcment-of-the-Fcdera.1-Housin g-Fi nance-Agency-on-Certai n-Su per-Priorit y-Liens.aspx ( Iast
visited Mar. 9, 2021 ).
22
"Real estate liens generally are ordered so that prior liens are paid in foreclosure before liens filed later in time. For example, a mortgage loan used
to buy the property takes priority over a later mortgage loan used to remodel the home. The earliest and thus highest priority mortgage loan is known
as a first lien, while the subsequent mortgage loan is deemed a second lien. If the homeowner defaults on the second lien loan, the first lien mortgage
holder retains the lien even if the second lien mortgage holder forecloses; however, the converse is not true. Tax assessments are an exception to this
lien priority rule. Generally, unpaid property tax assessments have priority over other liens, regardless of the date the prior liens were recorded or
when the tax assessments became delinquent. This makes the lien priority for PACE financing senior to liens for mortgage loans closed prior to the
homeowner's acceptance of the PACE financing. In the case of default by the homeowner on the PACE assessment, local governments and investors
in PACE bonds can expect to collect the balance owed on a PACE assessment before any recovery by a mortgage lender." Prentiss Cox, Keeping
PACE?: The Case Against Property Assessed Clean Energy Financing Programs, 83 U. Colo. L. Rev. 83, 94 (2011),
https://scholarship. law. umn.cdu/facu ltv artic les/549 (last visited Mar. 9, 2021).
23
FHF A, supra.
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This restriction has two potential implications for borrowers. First, a homeowner with a first-lien PACE
loan may not refinance their existing mortgage with a Fannie Mae or Freddie Mac mortgage. Second,
anyone wanting to buy a home that already has a first-lien PACE loan cannot use a Fannie Mae or
Freddie Mac loan for the purchase. These restrictions may reduce the marketability of the house or
require the homeowner to pay off the PACE loan before selling the house. 24
Additionally, in December 2017, the Department of Housing and Urban Development announced that
the Federal Housing Administration will no longer insure new mortgages on properties that include
PACE assessments, citing concerns about the potential for increased losses to the Mutual Mortgage
Insurance Fund resulting from the priority lien status given to such assessments.25
Some residential PACE programs are now operating with loan loss reserve funds , appropriate
disclosures, or other protections meant to address FHFA's concerns .26 For example, in 2013 California
created a reserve fund to compensate first mortgage lenders in case of a foreclosure or a forced sale
attributable to a PACE loan. Additionally, Oklahoma and Vermont have passed legislation to
downgrade PACE from senior lien to junior lien, and there have been attempts by Congress to revise
residential PACE programs at the federal level, including the 2014 PACE Assessment Protection Act. 27
Consumer Protection
Consumer issues have surrounded the PACE programs from their inception 28 . These include the cost
of funding, contractor sales techniques (notably, responding to a limited homeowner problem and
marketing a full house retrofit), rolling the administrative fees for the local government into the PACE
loan amount, product sales at above market interest rates, workmanship issues, inadequate
disclosures, and indiscriminate lending regardless of ability to repay. 29
In response to these consumer issues, Congress amended the Truth in Lending Act in 2018, directing
the Consumer Financial Protection Bureau to implement federal regulations which provide more
effective consumer protections relating to PACE loans, especially those related to the ability of a
homeowner to repay the loan. 30
The United States Department of Energy maintains "best practice guidelines" 31 for residential PACE
financing programs, which includes measures relating to:
• Establishing financial eligibility and verifying property ownership
• Confirming property-based debt, tax assessments, and property valuation
• Reviewing property owner income and debt obligations
• Establishing consumer and lender protections
24
FHFA, supra.
25
FHFA, Property Assessed Clean Energy (PACE) Program, 85 Fed. Reg. I 1,2738 (Jan. 16, 2020).
26
Commercial PACE programs were not directly affected by FHFA's actions because Fannie Mae and Freddie Mac do not underwrite commercial
mortgages. Database of State Incentives for Renewables & Efficiency, supra note 8.
27
NCSL, PACE Financing https://www.nc l.org/research/energv/ pace-financing.aspx (last visited Mar. 7, 202 I).
28
"PACE loans, offered through home improvement contractors, often in door-to-door sales, and secured by a property tax lien, are collected through
a property tax assessment that takes priority over any existing mortgage. PACE programs must be authorized by state and local governments, but are
privately run with little or no government oversight. Over the last two years, there has been a sharp increase in homeowners seeking assistance from
legal services and other organizations in relation to PACE loans. The goal of improving home energy efficiency is being overshadowed by the lack of
adequate consumer protection for these loans. Weak PACE loan regulation enables contractors to saddle homeowners with debt they cannot afford
and puts their homes at risk for foreclosure." National Consumer Law Center, Advocates Applaud CFPB 's Intention lo Deal with PACE Loan
Program Abuses (Mar. 4, 2019) https://www.nc lc.org/media-center/advocates-applaud-cfpbs-intcntion-Lo-deal-wi1h-pace-loan-program-abuscs.html
(last visited Mar. 9, 2021 ).
29
FHF A, Property Assessed Clean Energy (PACE) Program, 85 Fed. Reg. 11,2738 (Jan. I 6, 2020).
°
3
FHFA, Property Assessed Clean Energy (PACE) Program, 85 Fed. Reg. 11,2738 (Jan. 16, 2020). See also Public Law I 15-174 (2018), section
307; codified at I 5 U.S.C. I 639c(b )(3)(C). and Bureau of Consumer Financial Protection, Advance Notice of Proposed Rulemaking on Residential
Property Assessed Clean Energy Financing, 84 FR 84 79 (March 8, 2019).
31
Department of Energy, Best Practice Guidelines for Residential PACE Financing Programs (Nov. I 8, 2016)
hllps:// ww\ .encrg)•.gov/siles/prod/ liles/2016/11/1'34/bcsl-practicc-guideline -RPA E.pd f (last visited Mar. 9, 2021 ).
STORAGE NAME: pcs0387.TIE.D0CX PAGE: 5
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• Establishing property owner education and disclosures
• Providing a right to cancel the purchase
• Determining appropriate minimum equity requirements and appropriate maximum assessments
• Providing equipment specifications and energy assessments
• Defining the relationship between PACE assessments and mortgage financing
• Providing for non-acceleration upon property owner default
• Notifying mortgage holders of record
• Addressing the needs and potential vulnerabilities of low-income and elderly households
Some local governments in Florida have implemented more stringent consumer protections than those
required by Florida law.32
Effect of the Bill
The bill amends s. 163.08, F.S., providing a number of changes to the PACE program.
Eligibility for PACE Loans
The bill provides that the total amount of any non-ad valorem assessment for a property under this
section may not exceed 20 percent of the fair market value of the property. Additionally, the total of any
non-ad valorem assessments plus any mortgage-related debt on the property may not exceed 97
percent of the fair market value of the property. The fair market value of the property must be derived
using any methodology commonly used in the real estate finance industry.
The bill requires a PACE program administrator to use certain information to reasonably determine
whether the property owner has the ability to pay the annual assessment for the qualifying
improvement, including the property owner's household income, housing expenses, assets, and other
debt obligations.
The bill specifies that a financing agreement may not be used to fund ancillary work unless the scope of
the ancillary work is directly related to and necessary for the installation and safe operation of a
qualifying improvement and the cost of the ancillary work does not exceed the cost of the individual
qualifying improvement to which it is directly related .
The bill creates definitions for the following terms :
• "Facility," means any portion of a building, structure, or site improvement located on a site as
defined in Section 202 of the 2020 Florida Building Code.
• "PACE contractor" means an independent contractor who is authorized under this section to
contract with a property owner to install qualifying improvements on real property and who is not
the owner of the property.
• "Program administrator" means a for-profit or not-for-profit entity which administers a qualifying
improvement program on behalf and at the discretion of a local government.
• "Qualifying improvement program" means a program that includes financing and administration
activities undertaken by a program administrator or other authorized entity for property owners
to purchase and install qualifying improvements on a building or facility.
• "Residential property" means real estate on which any of the following is located:
o One single-family residential unit or one multifamily structure containing one to four
residential units;
o Single-family residential units such as condominiums , townhouses, timeshares , mobile
homes, or houses in a subdivision that may be legally sold, leased, or otherwise
conveyed on a unit-by-unit basis, regardless of whether the units are a part of a larger
building or parcel containing more than four residential units.
32
Palm Beach County, Ord. No.2017-012, Section 6. Disclosure Requirements
hll ps://discovcr.pbcgo .org/resilience/PDF/PACE ORDINANCE 20 17-0 l2%20-%20ADA%20 ompliant. pdf (last visited Mar. 9, 2021 ).
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Written Disclosures
The bill specifies that, before entering into a financing agreement for a qualifying improvement, the
local government or program administrator must determine that:
• The property owner is current on all mortgage debt on the property and has had no more than
one late payment exceeding 30 days during the 12 months immediately preceding the
application date.
• The holders or loan servicers of any mortgage encumbering or otherwise secured by the
property have received notice of the assessment at least 30 days in advance.
• Property owners whose taxes are paid through an escrow account have notified the holder of
the escrow account that a non-ad valorem assessment will be imposed upon the property.
• The term of the financing agreement does not exceed the estimated useful life of the qualifying
improvement.
• The property owner has acknowledged certain written disclosures, as described below.
• A residential property owner has not been subject to a bankruptcy proceeding within the last 7
years unless it was discharged or dismissed more than 2 years prior.
• A residential property owner is current on nonmortgage debt excluding medical debt, and has
had no more than one late payment exceeding 30 days during the 12 months.
• The property is within the geographic boundaries of the applicable qualifying improvement
program .
• The property owner has obtained or sought to obtain additional qualifying improvements on the
same property that have not yet been recorded.
The bill requires that the local government or program administrator, before execution of the financing
agreement, provide a written disclosure form to the property owner, which contains the key terms of the
agreement, including:
• A description of the qualifying improvement;
• The total financed amount, including the cost of the qualifying improvement, ancillary work,
installation, program fees, and prepaid interest, if any;
• The annual assessment process and yearly payment schedule;
• The amount of the annual assessment;
• The term of the total financed amount;
• The interest rate for the financed amount;
• The annual percentage rate;
• The total estimated annual costs that the residential real property owner will have to pay under
the assessment contract, including applicable fees;
• The total estimated average monthly equivalent amount of funds the residential real property
owner would have to save in order to pay the annual costs of the assessment, including
applicable fees;
• The estimated date when the residential real property owner's first property tax payment, which
includes the assessment, will be due.
The disclosure must form contain the following statements, which must be individually acknowledged in
writing:
• "I UNDERSTAND THAT IF I SELL OR REFINANCE THE PROPERTY, I MAY BE REQUIRED
TO PAY OFF THE OUTSTANDING FINANCED AMOUNT AS A CONDITION OF THE SALE
OR THE REFINANCE OF THE PROPERTY." (This disclosure must be made in 24-point, bold
font.)
• "I understand that the annual assessment will be paid when property taxes are paid and will
result in a lien being placed on my property."
• "I understand that the annual assessment will be added to my property tax bill and if I pay my
property taxes through my mortgage payment using an escrow account, I must notify my
mortgage lender."
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• "I understand that if I fail to pay the annual assessment, I may incur penalties and fees and the
local government could issue a tax certificate which might result in the loss of my property."
• "I understand that any potential utility or insurance savings are not guaranteed and will not
reduce the assessment or total assessment amount."
• "I understand that I have 3 days to cancel the financing agreement. The 3-day right expires on
midnight of the third business day after I sign the agreement."
• "I understand that the local government, program administrator or PACE contractor do not
provide tax advice and that I should seek professional tax advice if I have questions regarding
tax credits, tax deductibility, or other tax impacts of the qualifying improvement or the
assessment contract.
• "I understand that I cannot be assessed a penalty if I prepay the outstanding financed amount."
A printed cancellation form must be provided to the property owner no later than the time the property
owner signs the financing agreement, allowing the property owner to cancel the contract.
Oral Disclosures
The bill requires the local government or program administrator to conduct an oral, recorded, telephone
call in the owner's preferred language, and which uses plain language, confirming the disclosures
described above. The owner or their representative must provide "written acknowledgement that the oral
confirmation was given . The bill also requires that the local government or program administrator
develop additional procedures to address the needs and concerns of elderly persons.
Other Encumbrances on Property
The bill prohibits a PACE loan on any residential real property where an existing loan encumbering the
property is subject to:
• A negative amortization schedule;
• A balloon payment; or
• Pre-payment fees, other than nominal administrative costs .
Contractor Screening
The bill states that a local government or program administrator may not enroll a PACE contractor who
offers financing on residential real property unless:
• The PACE contractor maintains in good standing an appropriate license from the state, if
applicable, as well as any other permits, licenses, or registrations required for engaging in its
business in the jurisdiction where it operates and maintains all state required bond and
insurance coverage.
• The PACE contractor agrees, in writing, to comply with all applicable laws, including applicable
advertising and marketing laws and regulations and other requirements in the bill.
• A process exists to enroll new PACE contractors, including a reasonable review of the
contractor's:
o Relevant work or project history,
o Financial and reputational background checks, and
o Status on the Better Business Bureau or other online platforms that track contractor
reviews .
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Contractor Payment
The bill requires that, before disbursing funds to a PACE contractor for a qualifying improvement on
residential real property, the local government or program administrator must first confirm that the
applicable work or service has been completed and that the local government has determined the work
complies with applicable codes and standards, including but not limited to the Florida Building Code
and the Florida Fire Prevention Code.
The bill also prohibits disclosure of the maximum financing amount for which a residential real property
owner is eligible to the PACE contractor or to a third party engaged in soliciting assessment contracts
under the PACE program.
Marketing and Communications Guidelines
The bill requires that a local government, program administrator, or PACE contractor, or a third party
engaged in marketing on the behalf of these entities, must comply with the following marketing and
communications guidelines and may not:
• Suggest or imply:
o That an assessment authorized pursuant to this section is a government assistance
program;
o That qualifying improvements are free or provided at no cost, or that the financing
related to an assessment authorized pursuant to this section is a free or no cost
program; or
o That the financing of a qualifying improvement using the PACE program does not
require the property owner to repay the financial obligation.
• Make any representation as to the tax deductibility of an assessment on residential real
property, but they may encourage a property owner to seek the advice of a tax professional
regarding tax matters related to assessments.
Unenforceable Contracts and Associated Remedies
The bill specifies that a contract to sell or install a qualifying improvement that is related to an
application for financing under a PACE program for a residential property is unenforceable, and a
PACE contractor may not begin work under such a contract, if:
• The property owner would not have entered into the contract but for the belief that the qualifying
improvement or its installation would be paid under the financing agreement;
• The property owner applied for, accepted, and canceled a qualifying improvement financing
agreement within the 3-day right-to-cancel period.
If a PACE contractor has initiated work on a residential property under an unenforceable contract as
determined above, the PACE contractor:
• May not receive compensation for that work under the financing agreement.
• Must restore the property to its original condition at no cost to the property owner.
• Must immediately return any money, property, and other consideration given by the property
owner. If the property owner provided any property and the PACE contractor does not or cannot
return it, the PACE contractor must immediately return the fair market value of the property or
its value as designated in the contract, whichever is greater.
If the PACE contractor has delivered chattel or fixtures to the residential property pursuant to an
unenforceable contract, the PACE contractor has 90 days from the date the contract was executed to
retrieve the chattel or fixtures provided that:
• The PACE contractor has fulfilled certain requirements under the bill.
• The chattel and fixtures can be removed at the PACE contractor's expense without damaging
the property owner's property and practically returned.
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• The residential property owner may retain any chattel or fixtures provided pursuant to an
unenforceable contract if a PACE contractor fails to comply with these provisions.
A contract which is otherwise unenforceable remains enforceable if the residential property owner
waives his or her right to cancel the contract, allows the PACE contractor to proceed with the
installation of the qualifying improvement, and cancels the financing agreement.
Limitations and Prohibitions on Solicitation, Advertising, and Other Inducements
The bill specifies that a program administrator may not authorize a PACE contractor or third party to
advertise the availability of financing agreements or solicit property owners on behalf of the program
administrator, unless:
• The PACE contractor or third party maintains the appropriate registration or certification from
the Construction Industry Licensing Board or any other permit, license, or registration required
to conduct business in the jurisdiction where it operates, and provides proof of having the
required bond and insurance coverage amounts.
• The program administrator obtains the PACE contractor's or third party's written agreement that
the PACE contractor or third party will meet applicable laws and rules and qualifying
improvement program policies and procedures, including those on advertising and marketing.
A local government or program administrator may not:
• Provide any direct or indirect cash payment or thing of material value to a PACE contractor in
excess of the actual price charged by that PACE contractor for the sale and installation of the
qualifying improvements that are financed by a financing agreement. However, a local
government or program administrator may provide information or services to a PACE contractor
to facilitate the installation of a qualifying improvement for a property owner.
• Reimburse a PACE contractor for its expenses for advertising and marketing campaigns and
materials. A program administrator and a PACE contractor may share expenses in connection
with joint advertising and marketing campaigns and materials, if the expenses are shared on a
commercially reasonable basis.
• Provide any direct cash payment or other thing of material value to a property owner explicitly
conditioned upon the property owner entering into a financing agreement. However, a program
administrator may offer programs or promotions that provide reduced fees or interest rates if the
reduced fees or interest rates are reflected in the financing agreements and are not provided to
the property owners as cash consideration.
• Provide to a PACE contractor engaged in soliciting financing agreements on its behalf any
information that discloses the amount of funds for which a property owner is eligible for
qualifying improvements or the amount of equity in a property.
For residential properties, a PACE contractor may not provide a different price for a qualifying
improvement financed under this section than the PACE contractor would provide if the property owner
paid for the improvement in cash.
Annual Report
The bill requires that each local government post an annual report on its website which contains the
following information:
• The number of qualifying improvements funded .
• The aggregate, average, and median dollar amounts of annual and total qualifying
improvements assessments funded .
• The percentage, the number, and the dollar value of qualifying improvements assessments
represented by the category types consisting of energy efficiency, renewable energy, and wind
resistance.
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• The number of defaulted assessments including the total number and defaulted amount, the
number and dates of missed payments, the total number of parcels defaulted and years in
default, and the percentage of defaults by total assessments.
• A summary of all reported violations of this section, including the resolution of each.
• The estimated number of jobs created .
• The number and percentage of homeowners 60 years of age or older participating in a
qualifying improvement program.
The report must be posted no later than April 1.
The bill provides for an effective date of July 1, 2021 .
B. SECTION DIRECTORY:
Section 1 Amends s. 163.08, F.S., providing for certain requirements related the property
assessed clean energy program .
Section 2 Provides for an effective date.
II. FISCAL ANALYSIS & ECONOMIC IMPACT STATEMENT
A. FISCAL IMPACT ON STATE GOVERNMENT:
1. Revenues:
None.
2. Expenditures:
None.
B. FISCAL IMPACT ON LOCAL GOVERNMENTS:
1. Revenues:
None.
2. Expenditures:
The bill may have an insignificant negative fiscal impact on local government expenditures as a
result of the annual report requirement.
C. DIRECT ECONOMIC IMPACT ON PRIVATE SECTOR:
To the extent that a local government or program administrator does not already impose similar
consumer protection measures, the bill will benefit property owners who choose to finance qualifying
improvements through a PACE program by ensuring that property owners are fully informed as to the
key terms and potential consequences of a PACE loan and by requiring a determination that they are
capable of repaying the loan. The bill may result in fewer defaults and potential foreclosures.
D. FISCAL COMMENTS:
None.
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111. COMMENTS
A. CONSTITUTIONAL ISSUES:
1. Applicability of Municipality/County Mandates Provision:
Not Applicable. This bill does not appear to require counties or municipalities to spend funds or take
action requiring the expenditures of funds; reduce the authority that counties or municipalities have
to raise revenues in the aggregate; or reduce the percentage of state tax shared with counties or
municipalities.
2. Other:
None.
8. RULE-MAKING AUTHORITY:
None.
C. DRAFTING ISSUES OR OTHER COMMENTS:
None.
IV. AMENDMENTS/ COMMITTEE SUBSTITUTE CHANGES
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FLORIDA H O U S E 0 F REPRESENTATIVES
PCS for HB 387 2021
1 A bill to be entitled
2 An act relating to improvements to real property;
3 amending s. 163.08, F.S.; providing and revising
4 definitions; prohibiting financing agreements for
5 qualifying improvements to fund ancillary work unless
6 specified criteria are met; prohibiting financing
7 agreements for qualifying improvements from being
8 approved unless specified criteria are met; requiring
9 the program administrator or other entity to use
10 specified information provided by the property owner
11 to determine the owner's ability to pay the annual
12 non-ad valorem assessment; providing criteria to be
13 used in making the determination; requiring the local
14 government or program administrator to develop a
15 written disclosure form to be given to property owners
16 that meets specified criteria; requiring the local
17 government or program administrator to provide a
18 printed cancellation form to and conduct an oral,
19 recorded telephone call with the property owner at a
20 specified time and containing specified information;
21 requiring the local government or program
22 administrator to develop procedures to address the
23 needs of elderly persons; specifying the total amount
24 of any non-ad valorem assessment that may be assessed
25 on properties as a result of qualifying improvements;
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26 prohibiting local governments or program
27 administrators from offering financing for certain
28 qualifying improvements if those financing agreements
29 meet certain criteria; providing criteria that must be
30 met before a local government or program administrator
31 may enroll a PACE contractor to offer financing for
32 residential properties; specifying criteria that must
33 be met before a PACE contractor may receive funds for
34 qualifying improvements on residential properties;
35 providing market and communications guidelines that
36 must be met when communicating with residential real
37 property owners; specifying the types of contracts
38 that are unenforceable and for which PACE contractors
39 may not begin work; providing procedures for the
40 return of chattel and fixtures that were installed in
41 an unenforceable contract; prohibiting PACE
42 contractors from engaging in specified activities
43 concerning PACE contractors; requiring local
44 governments that have authorized qualifying
45 improvement programs to post specified information on
46 their websites on an annual basis; providing an
47 effective date.
48
49 Be It Enacted by the Legislature of the State of Florida:
50
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51 Section 1. Section 163.08, Florida Statutes, is amended to
52 read:
53 163.08 Supplemental authority for improvements to real
54 property.-
55 (1) (a) In chapter 2008-227, Laws of Florida, the
56 Legislature amended the energy goal of the state comprehensive
57 plan to provide, in part, that the state shall reduce its energy
58 requirements through enhanced conservation and efficiency
59 measures in all end-use sectors and reduce atmospheric carbon
60 dioxide by promoting an increased use of renewable energy
61 resources. That act also declared it the public policy of the
62 state to play a leading role in developing and instituting
63 energy management programs that promote energy conservation,
64 energy security, and the reduction of greenhouse gases. In
65 addition to establishing policies to promote the use of
66 renewable energy, the Legislature provided for a schedule of
67 increases in energy performance of buildings subject to the
68 Florida Energy Efficiency Code for Building Construction. In
69 chapter 2008-191, Laws of Florida, the Legislature adopted new
70 energy conservation and greenhouse gas reduction comprehensive
71 planning requirements for local governments. In the 2008 general
72 election, the voters of this state approved a constitutional
73 amendment authorizing the Legislature, by general law, to
74 prohibit consideration of any change or improvement made for the
75 purpose of improving a property's resistance to wind damage or
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76 the installation of a renewable energy source device in the
77 determination of the assessed value of residential real
78 property.
79 (b) The Legislature finds that all energy-consuming-
80 improved properties that are not using energy conservation
81 strategies contribute to the burden affecting all improved
82 property resulting from fossil fuel energy production. Improved
83 property that has been retrofitted with energy-related
84 qualifying improvements receives the special benefit of
85 alleviating the property's burden from energy consumption. All
86 improved properties not protected from wind damage by wind
87 resistance qualifying improvements contribute to the burden
88 affecting all improved property resulting from potential wind
89 damage. Improved property that has been retrofitted with wind
90 resistance qualifying improvements receives the special benefit
91 of reducing the property's burden from potential wind damage.
92 Further, the installation and operation of qualifying
93 improvements not only benefit the affected properties for which
94 the improvements are made, but also assist in fulfilling the
95 goals of the state's energy and hurricane mitigation policies.
96 In order to make qualifying improvements more affordable and
97 assist property owners who wish to undertake such improvements,
98 the Legislature finds that there is a compelling state interest
99 in enabling property owners to voluntarily finance such
100 improvements with local government assistance.
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101 (c) The Legislature determines that the actions authorized
102 under this section, including, but not limited to, the financing
103 of qualifying improvements through the execution of financing
104 agreements and the related imposition of voluntary assessments
105 are reasonable and necessary to serve and achieve a compelling
106 state interest and are necessary for the prosperity and welfare
107 of the state and its property owners and inhabitants.
108 (2) As used in this section, the term:
109 (a) " Facility" means any portion of a building, structure,
110 or site improvement located on a site as defined ins. 202 of
111 the 2020 Florida Building Code.
112 ill "Local government" means a county, a municipality, a
113 dependent special district as defined ins. 189.012, or a
114 separate legal entity created pursuant to s. 163.01(7).
115 (c) "PACE contractor" means an independent contractor who
116 is authorized under this section to contract with a property
117 owner to install qualifying improvements on real property and
118 who is not the owner of such property.
119 (d) "Program administrator" means a for-profit or not-for-
120 profit entity which administers a qualifying improvement program
121 on behalf and at the discretion of a local government.
122 M +e+- "Qualifying improvement" includes any:
123 1. Energy conservation and efficiency improvement, which
124 is a measure to reduce consumption through conservation or a
125 more efficient use of electricity, natural gas, propane, or
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126 other forms of energy on the property, including, but not
127 limited to, air sealing; installation of insulation;
128 installation of energy-efficient heating, cooling, or
129 ventilation systems; building modifications to increase the use
130 of daylight; replacement of windows; installation of energy
131 controls or energy recovery systems; installation of electric
132 vehicle charging equipment; and installation of efficient
133 lighting equipment.
134 2. Renewable energy improvement, which is the installation
135 of any system in which the electrical, mechanical, or thermal
136 energy is produced from a method that uses one or more of the
137 following fuels or energy sources: hydrogen, solar energy,
138 geothermal energy, bioenergy, and wind energy.
139 3. Wind resistance improvement, which includes the
140 prod u c t s and inst a l l ation for, but is not limited to:
141 a. Improving the strength of the roof deck attachment;
142 b. Creating a secondary water barrier to prevent water
143 intrusion;
144 c. Installing wind-resistant shingles;
145 d. Installing gable-end bracing;
146 e. Reinforcing roof-to-wall connections;
147 f. Installing storm shutters; or
148 g. Installing opening protections.
149 (f) "Qualifying improvement program" means a program that
150 includes the financing and administration activities undertaken
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151 by a local government or program administrator for property
152 owners to purchase and install qualifying improvements on a
153 building or facility .
154 (g) "Residential propert y " means real p rop ert y u p on which
155 any of the following is located:
156 1. One single-family residential unit or one multifamily
157 structure containing one to four residential units; or
158 2. Si ng l e-fa mi ly r e sidential units such as condominiums,
159 townhouses , timeshares , mobile homes , or houses in a subdivision
160 tha t ma y b e l egal l y s ol d, le ased , or o th erwi se c onve y ed on a
161 unit-by-unit basis, regardless of whether the units are a part
162 of a larger build i ng o r pa r c e l con taining more than four
163 residential units.
164 (3) A local government may levy non-ad valorem assessments
165 to fund qualifying improvements.
166 (4) Subject to local government ordinance or resolution, a
167 property owner may apply to the local government for funding to
168 finance a qualifying improvement and enter into a financing
169 agreement with the local government. Costs incurred by the local
170 government for such purpose may be collected as a non-ad valorem
171 assessment. A non-ad valorem assessment shall be collected
172 pursuant to s. 197. 3 632 and, notwithstanding s. 197. 3632 ( 8) (a) ,
173 shall not be subject to discount fo r early payment. However, the
174 notice and adoption requirements of s. 197.3632(4) do not apply
175 if this section is used and complied with, and the intent
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176 resolution, publication of notice, and mailed notices to the
177 property appraiser, tax collector, and Department of Revenue
178 required by s. 197. 3 632 ( 3) (a) may be provided on or before
179 August 15 in conjunction with any non-ad valorem assessment
180 authorized by this section, if the property appraiser, tax
181 collector, and local government agree.
182 (5) Pursuant to this section or as otherwise provided by
183 law or pursuant to a local government's home rule power, a local
184 government may enter into a partnership with one or more local
185 governments for the purpose of providing and financing
186 qualifying improvements.
187 (6) A qualifying improvement program may be administered
188 by a for-profit entity or a not-for-profit organization on
189 behalf of and at the discretion of the local government.
190 (7) A local government may incur debt for the purpose of
191 providing such improvements, payable from revenues received from
192 the improved property, or any other available revenue source
193 authorized by law.
194 (8) A local government may enter into a financing
195 agreement only with the record owner of the affected property.
196 Any financing agreement entered into pursuant to this section or
197 a summary memorandum of such agreement shall be recorded in the
198 public records of the county within which the property is
199 located by the sponsoring unit of local government within 5 days
200 after execution of the agreement. The recorded agreement shall
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201 provide constructive notice that the non-ad valorem assessment
202 to be levied on the property constitutes a lien of equal dignity
203 to county taxes and assessments from the date of recordation.
204 (9) A financing agreement may not be used to fund
205 ancillar y work unless the scope of the ancillary work is
206 directly related to and necessary for the installation and safe
207 operation of a qualifying improvement and the cost of the
208 ancillary work does not exceed the cost of the individual
209 qualifying improvement to which it is directly related.
210 ll....Ql-f-9+ A Before entering into a financing agreement for a
211 qualifying improvement may not be approved unless 7 the local
212 government or program administrator, as applicable, has shall
213 reasonably determined determine that:
214 ~ All property taxes and any other assessments levied on
215 the same bill as property taxes are paid and have not been
216 delinquent for the preceding 3 years or the property owner's
217 period of ownership, whichever is less; 'HTa-t-
218 J...el There are no involuntary liens, including, but not
219 limited to, construction liens on the property; -t-fl-a4:.
220 J..£L No notices of default or other evidence of property-
221 based debt delinquency have been recorded during the preceding 3
222 years or the property owner's period of ownership, whichever is
223 less; and that
224 (d) The property owner is current on all mortgage debt on
225 the property and has had no more than one late payment exceeding
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226 30 days during the 12 months immediately preceding the
227 application date; The property owner is current on all mortgage
228 debt on the property.
229 (e) The holders or loan servicers of any mortgage
230 encumbering or otherwise secured by the property have received
231 the written notice required by subsection (16);
232 (f) Any prope rty owner whose r eal propert y taxes are paid
233 through an escrow account has notified the holder of the escrow
234 account that a non-ad valorem assessment will be imposed upon
235 the propert y p ursuant to this section;
236 (g) The term of the financing agreement does not exceed
237 the estimated useful life of the qualifying improvement. The
238 local government or program administrator, as applicable, shall
239 determine the useful life using established third-party
240 standards, including certification criteria from government
241 agencies or nationally recognized standards and testing
242 organizations;
243 (h) The property owner has acknowledged in writing the
244 disclosure statements required by paragraph (12) (b);
245 (i) For residential properties, the property owner has not
246 been subject to a bankruptcy proceeding within the last 7 years
247 unless it was discharged or dismissed more than 2 y ears before
248 the date that the property owner applied for funding as set
249 forth in subsection (4);
250 (j) For residential properties, the property owner is
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251 current on nonmortgage debt excluding medical debt, and has had
252 no more than one late payment exceeding 30 days during the 12
253 months immediately preceding the date that the property owner
254 applied for funding as set forth in subsection (4);
255 (k) The property is within the geographic boundaries of
256 the applicable qualifying improvement program; and
257 (1) The local government or program administrator, as
258 applicable, has asked if the property owner has obtained or
259 sought to obtain additional qualifying improvements on the same
260 property that have not yet been recorded. The failure of a
2 61 property owner to disclose information set forth in this
262 subsection does not invalidate a financing agreement or any
263 obligation thereunder, even if the total financed amount of the
264 qualifying improvement exceeds the amount that would otherwise
265 be authorized under subsection (15).
266
267 The existence of a prior qualifying improvement non-ad valorem
268 assessment or a prior financing agreement is not evidence that
269 the financing agreement under consideration is affordable or
270 meets other program requirements.
271 (11) In addition to obtaining the information in
272 subsection (10), and before a local government or program
273 administrator, as applicable, approves a qualifying improvement
274 on residential property, he or she must use information
275 contained in the property owner's application, reasonably
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276 r e li ab l e t h i rd-part y records, or an automated verification
277 system to reasonably determine whether the property owner has
278 the ability to pay the annual non-ad valorem assessment for the
279 qualifying improvement. The local government or program
280 admi n i strat or , as applicable, must review the property owner's
281 household income, housing expenses, assets, and other debt
282 ob l igations. If the local gove r nment or program administrator,
283 as applicable, uses an automated verification system, it must be
284 a system that can verify the property owner's income, is not
285 based on predictive or estimation methodologies, and has been
286 determined sufficient for such verification purposes by a
287 federal mortgage lending authority or regulator. In reviewing
288 the propert y owner's ability to pa y , the local government or
289 program administrator, as applicable:
290 (a) When determining the household income, may include the
291 i n c ome o f a ny p rop erty owne r aged 18 ye ars o ld or o l der whos e
292 name is on the property title. If a person's income is
293 cons i d e r e d, t hat pe r s on 's deb t o bligations must also be
294 considered.
295 (b) May not consider the equity in the property that will
296 secure the non-ad valorem assessment.
297 (c) Shall determine the propert y owner's debt obligations
298 using reasonably reliable third-party records, including at
299 least, one consumer credit report from an agency that meets the
300 requirements of 15 U.S.C. s. 168la(p). Debt obligations to be
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301 reviewed include:
302 1. Secured and unsecured debt.
303 2. Housing expenses. The local government or program
304 administrator, as applicable, shall make a reasonable estimate
305 of the basic housing expenses based on the number of persons in
306 the household.
307 3. Stated alimony or child support obligations.
308 (d) Shall determine whether the property owner has
309 sufficient income to pay the annual non-ad valorem assessment
310 and that he or she has sufficient residual income to meet his or
311 her household living expenses.
312 (12) Each local government or program administrator that
313 offers a qualifying improvement p ro g ram must:
314 (a) Develop a written disclosure form that must be
315 provided to the property owner before he or she executes the
316 financing agreement and which contains the key terms of the
317 agreement, including:
318 1. A description of the qualifying improvement;
319 2. The total financed amount, including the cost of the
320 qualifying improvement, ancillary work, installation, program
321 fees, and prepaid interest, if any;
322 3. The annual non-ad valorem assessment process and yearly
323 payment schedule;
324 4. The amount of the annual non-ad valorem assessment;
325 5. The term of the total financed amount ;
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326 6. The interest rate for the financed amount;
327 7. The annual percentage rate;
328 8. The total estimated annual costs that the residential
329 real property owner will have to pay under the assessment
330 contract, including applicable fees;
331 9. The total estimated average monthly equivalent amount
332 of funds the residential real property owner would have to save
333 in order to pay the annual costs of the non-ad valorem
334 assessment, including applicable fees; and
335 10. The estimated due date of the residential real
336 property owner's first property tax payment that includes the
337 non-ad valorem assessment.
338 (b) Include the following statements in the written
339 disclosure form, using the same order as listed in this
340 paragraph, each of which must be individually acknowledged in
341 writing by the property owner:
342 1. "I UNDERSTAND THAT IF I SELL OR REFINANCE THE PROPERTY,
343 I MAY BE REQUIRED TO PAY OFF THE OUTSTANDING FINANCED AMOUNT AS
344 A CONDITION OF THE SALE OR THE REFINANCE OF THE PROPERTY ."
345
346 The previous statement must be made in at least 24-point
347 boldfaced type.
348
349 2. "I understand that the annual non-ad valorem assessment
350 will be paid when property taxes are paid and will result in a
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351 lien being placed on my property. "
352 3. "I understand that the annual non-ad valorem assessment
353 will be added to my property tax bill and if I pay my property
354 taxes through my mortgage payment using an escrow account, I
355 must notify my mortgage lender. "
356 4. "I understand that if I fail to pay the annual non-ad
357 valorem assessment, I may incur penalties and fees and the local
358 government could issue a tax certificate which might result in
359 the loss of my property."
360 5. "I understand that any potential utility or insurance
361 savings are not guaranteed and will not reduce the annual non-ad
362 valorem assessment or total assessment amount."
363 6. "I understand that I have 3 days to cancel the
364 financing agreement. The 3-day right expires at midnight of the
365 third business day after I sign the agreement ."
366 7. "I understand that the local government, program
367 administrator, or PACE contractor do not provide tax advice and
368 that I should seek professional tax advice if I have questions
369 regarding tax credits, tax deductibility, or other tax impacts
370 of the qualifying improvement or the assessment contract.
371 8. "I understand that I cannot be assessed a penalty if I
372 prepay the outstanding financed amount."
373 (c) Provide a printed cancellation form to the property
374 owner no later than the time the property owner signs the
375 financing agreement which allows the property owner to cancel
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376 the contract, within the 3-day period specified in subparagraph
377 (b) 6.
378 (d) Conduct, with at least one residential real property
379 owner or an authorized representative, an oral, recorded
380 telephone call during which time the local government or program
381 administrator, as applicable, must use plain language. The local
382 government or program administrator, as applicable, must ask the
383 residential real property owner if he or she would like to
384 communicate primarily in a language other than English and, if
385 so, must conduct the call in the owner's preferred language. A
386 local government or program administrator, as applicable may not
387 leave a voicemail to the residential real property owner to
388 satisfy this requirement. The owner or their representative must
389 provide written acknowledgement that the oral confirmation was
390 given. A local government or program administrator, as
391 applicable, as part of this telephone call, must confirm with
392 the residential real property owner:
393 1. That at least one residential real property owner has
394 access to a copy of the assessment contract and financing
395 estimates and disclosures.
396 2. The qualifying improvement that is being financed.
397 3. The total estimated annual costs that the residential
398 real property owner will have to pay under the assessment
399 contract, including applicable fees.
400 4. The total estimated average monthly equivalent amount
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401 of funds the residential real property owner would have to save
402 in order to pay the annual costs of the non-ad valorem
403 assessment, including applicable fees.
404 5. The estimated due date of the residential real property
405 owner's first property tax payment that includes the non-ad
406 valorem assessment.
407 6. The term of the assessment contract.
408 7. That payments for the assessment contract will cause
409 the residential real property owner's annual tax bill to
410 increase , th at payments wi ll be made through an additional
411 annual non-ad valorem assessment on the property, and will be
412 paid either directly to the county tax collector's office as
413 part of the total annual secured property tax bill or may be
414 paid through the residential real property owner's mortgage
415 escrow account.
416 8. That the qualifying residential property owner has
417 disclosed whether the property has received or is seeking
418 additional non-ad valorem assessments and has disclosed all
419 other assessments or special taxes that are or are about to be
420 placed on the property.
421 9. That the property will be subject to a lien during the
422 term of the assessment contract and that the obligations under
423 the contract may be required to be paid in full before the
424 residential real property owner sells or refinances the
425 property .
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426 10. That any potential utility or insurance savings are
427 not guaranteed and will not reduce the annual non-ad valorem
428 assessment or total assessment amount.
429 11. That the local government, program administrator, or
430 PACE contractor do not provide tax advice and that the
431 residential real property owner should seek professional tax
432 advice if he or she has questions regarding tax credits, tax
433 deductibility, or other tax impacts of the qualifying
434 improvement or the assessment contract.
435 (e) The local government or program administrator shall
436 devel op additional p rocedures under this subsection to address
437 the needs and concerns of elderly persons.
438 J..lll_-f+e+ A qualifying improvement shall be affixed or
439 connected to a building or facility that is part of the property
440 and shall constitute an improvement to the building or facility
441 or a fixture attached to the building or facility. An agreement
442 between a local government and a qualifying property owner may
443 not cover wind-resistance improvements in buildings or
444 facilities under new construction or construction for which a
445 certificate of occupancy or similar evidence of substantial
446 completion of new construction or improvement has not been
447 issued.
448 J..!il-f-±-±+ Any work requiring a license under any applicable
449 law to make or install a qualifying improvement shall be
450 performed by a contractor properly certified or registered
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451 pursuant to part I or part II of chapter 489.
452 ~(12) (a) Without the consent of the holders or loan
453 serviccrs of any fFIOrtgagc encumbering or otherwise secured by
454 the property, The total amount of any non-ad valorem assessment
455 for a property under this section may not exceed 20 percent of
456 the fair market value of the property just value of the property
457 as determined by the county property appraiser. In addition, the
458 total of any non-ad valorem assessments plus any mortgage-
459 related debt on the property may not exceed 97 percent of the
460 fair market value of the property. The fair market value of the
461 property shall be derived using any methodology commonly used in
462 the real estate finance industry.
463 (b) Notwithstanding paragraph (a), a non ad valorem
4 64 assessment for a qualifying improvement defined in subparagraph
465 (2) (b) 1. or _s ubparagraph (2) (b) 2. that is supported by an energy
466 audit is not subject to the limits in this subsection if the
467 audit demonstrates that the annual energy savings from the
4 68 qualified improvement equals or eMeeeds the annual repayment
469 amount of the non ad valorem assessment .
470 J.l.§l-H:-3+ At least 30 days before entering into a financing
471 agreement, the property owner shall provide to the holders or
472 loan servicers of any existing mortgages encumbering or
473 otherwise secured by the property a notice of the owner's intent
474 to enter into a financing agreement together with the maximum
475 principal amount to be financed and the maximum annual
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476 assessment necessary to repay that amount. A verified copy or
477 other proof of such notice shall be provided to the local
478 government o r pro gram admini s tr a t o r , as applicable. A provision
479 in any agreement between the a mortgagee or other lienholder and
480 a property owner, or otherwise now or hereafter binding upon a
481 property owner, which allows for acceleration of payment of the
482 mortgage, note, or lien or other unilateral modification solely
483 as a result of entering into a financing agreement as provided
484 for in this section is not enforceable. This subsection does not
485 limit the authority of the holder or loan servicer to increase
486 the required monthly escrow by an amount necessary to annually
487 pay the qualifying improvement assessment.
488 Jl.2.l-f-l-4+ At or before the time a purchaser executes a
489 contract for the sale and purchase of any property for which a
490 non-ad valorem assessment has been levied under this section and
491 has an unpaid balance due, the seller shall give the prospective
492 purchaser a written disclosure statement in the following form,
493 which shall be set forth in the contract or in a separate
494 writing:
495
496 QUALIFYING IMPROVEMENTS FOR ENERGY EFFICIENCY, RENEWABLE ENERGY,
497 OR WIND RESISTANCE.-The property being purchased is located
498 within the jurisdiction of a local government that has placed an
499 non-ad valorem assessment on the property pursuant to s. 163.08,
500 Florida Statutes. The non-ad valorem assessment is for a
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501 qualifying improvement to the property relating to energy
502 efficiency, renewable energy, or wind resistance, and is not
503 based on the value of property. You are encouraged to contact
504 the county property appraiser's office to learn more about this
505 and other assessments that may be provided by law.
506 J.]JU_-f-±-§-t A provision in any agreement between a local
507 government and a public or private power or energy provider or
508 other utility provider is not enforceable to limit or prohibit
509 any local government from exercising its authority under this
510 section.
511 l1..2.l-f-±--6+ This section is additional and supplemental to
512 county and municipal home rule authority and not in derogation
513 of such authority or a limitation upon such authority.
514 (20) A local government or program administrator, as
515 applicable, may not offer financing for an qualifying
516 improvement authorized pursuant to this section on any
517 residential real property that includes any of the following:
518 (a) A negative amortization schedule;
519 (b) A balloon payment; or
520 {c) Pre-payment fees, other than nominal administrative
521 costs.
522 (21) For residential real property, a local government or
523 program administrator, as applicable:
524 (a) May not enroll a PACE contractor who offers financing
525 on residential real property unless:
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526 1. The local government or program administrator, as
527 applicable, determines that the PACE contractor maintains in
528 good standing an appropriate license from the state, if
529 applicable, as well as any other permits, licenses, or
530 registrations required for engaging in its business in the
531 jurisdiction where it operates and maintains all state required
532 bond and insurance coverage.
533 2. A local government or program administrator, as
534 applicable, obtains the PACE contractor's written agreement that
535 the PACE contractor will comply with all applicable laws,
536 including applicable advertising and marketing laws and
537 regulations and the requirements of subsection (23).
538 (b) Must maintain a process to enroll new PACE contractors
539 that includes reasonable review of the following for each
540 contractor:
541 1. Relevant work or project history.
542 2. Financial and reputational background checks.
543 3. The contractor's status on the Better Business Bureau
544 platform or other online platforms that track contractor
545 reviews.
546 (22) (a) Before disbursing funds to a PACE contractor for a
547 qualifying improvement on residential real propertyJ the local
548 government or program administrator, as applicable, must first
549 confirm that the applicable work or service has been completed
550 and the local government has determined the work complies with
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551 applicable codes and standards, including, but not limited to,
552 the Florida Building Code and the Florida Fire Prevention Code.
553 (b) A local government or program administrator, as
554 applicable, may not disclose the maximum financing amount for
555 which a residential real property owner is eligible to a PACE
556 contractor or to a third party engaged in soliciting assessment
557 contracts financed pursuant to this section.
558 (23) When communicating with residential real property
559 owners, a local government, program administrator, PACE
560 contractor, or a third party engaged in marketing on behalf of
561 these entities, must comply with the following marketing and
562 communications guidelines and may not:
563 (a) Suggest or imply:
564 1. That a non-ad valorem assessment authorized under this
565 section is a government assistance program;
566 2. That qualifying improvements are free or provided at no
567 cost, or that the financing related to an non-ad valorem
568 assessment authorized under this section is free or provided at
569 no cost; or
570 3. That the financing of a qualifying improvement using
571 the program authorized pursuant to this section does not require
572 the property owner to repay the financial obligation.
573 (b) Make any representation as to the tax deductibility of
574 a non-ad valorem assessment on residential real property. A
575 local government, program administrator, or PACE contractor, or
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576 a third party engaged in marketing on behalf of these entities,
577 may encourage a property owner to seek the advice of a tax
578 professional regarding tax matters related to assessments.
579 (24) (a) A contract to sell or install a qualifying
580 improvement that is related to an application for financing in a
581 qualifying improvement program for a residential property is
582 unenforceable and a PACE contractor may not begin work under
583 such a contract if:
584 1. The property owner would not have entered into the
585 contract but for the belief that the qualifying improvement or
586 its installation would be paid under the financing agreement; or
587 2. The property owner applied for, accepted, and canceled
588 a qualifying improvement financing agreement within the 3-day
589 right-to-cancel period set forth in subparagraph ( 12) (b) 6.
590 (b) If a PACE contractor has initiated work on a
591 residential property under an unenforceable contract as
592 determined under paragraph (a) , the PACE contractor:
593 1. May not receive compensation for that work under the
594 financing agreement.
595 2. Shall restore the property to its original condition at
596 no cost to the property owner.
597 3. Shall immediately return any money, property, and other
598 consideration given by the property owner. If the property owner
599 provided any property and the PACE contractor does not or cannot
600 return it, the PACE contractor shall immediately return the fair
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601 market value of the property or its value as designated in the
602 contract, whichever is greater.
603 (c) If the PACE contractor has delivered chattel or
604 fixtures to the residential property pursuant to an
605 unenforceable contract, the PACE contractor shall have 90 days
606 from the date the contract was executed to retrieve the chattel
607 or fixtures provided that:
608 1. The PACE contractor has fulfilled the requirements of
609 subparagraphs (b)2. and 3 .
610 2. The chattel and fixtures can be removed at the PACE
611 contractor's expense without damaging the property owner's
612 property and practically returned.
613 (d) The residential property owner may retain any chattel
614 or fixtures provided pursuant to an unenforceable contract if a
615 PACE contractor fails to comply with the provisions of this
616 subsection.
617 (e) A contract which is otherwise unenforceable under this
618 subsection remains enforceable if the residential property owner
619 waives his or her right to cancel the contract, allows the PACE
620 contractor to proceed with the installation of the qualifying
621 improvement , and cancels the financing agreement.
622 (25) (a) A PACE contractor or third party may not advertise
623 the availability of financing agreements or solicit property
624 owners on behalf of the local government or program
625 administrator unless:
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626 1. The PACE contractor or third party maintains the
627 appropriate registration or certification from the Construction
628 Indus tr y Lice n s i ng Boa rd or a n y other permit, license, or
629 registration required to conduct business in the jurisdiction
630 whe re i t ope ra t es, and provides proof of having the required
631 bond and insurance coverage amounts.
632 2. The l oc a l gove rnme nt or program administrator, as
633 applicable, obtains the PACE contractor's or third party's
634 written ag r eemen t that the PACE contractor or third party will
635 meet applicable laws and rules and qualifying improvement
636 pro gram pol ici es and p roced ure s, i ncludi ng t h ose on advertising
637 and marketing.
638 (b ) A local government or program administrator may not
639 provide any direct or indirect cash payment or thing of material
640 value to a PACE contractor or third party in excess of the
641 actual price charged by that PACE contractor for the sale and
642 installation of the qualifying improvements that are financed by
643 a financing agreement. However, a program administrator may
644 provide information or services to a PACE contractor to
645 facilitate the installation of a qualifying improvement for a
646 property owner.
647 (c) A local government or program administrator may not
648 reimburse a PACE contractor or third party for its expenses in
649 advertising and marketing campaigns and materials. A local
650 government or program administrator, as applicable, and a PACE
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651 contractor may share expenses in connection with joint
652 advertising and marketing campaigns and materials, if the
653 expe nses are shared on a commercially reasonable basis.
654 (d) A local government or program administrator may not
655 prov i de to a PACE contractor engaged in soliciting financing
656 agreements on its behalf any information that discloses the
657 amount of funds for which a property owner is eligible for
658 qualifying improvements or the amount of equity in a property.
659 (e) For residential properties, a PACE contractor may not
660 provide a different price for a qualifying improvement financed
661 under this section than the PACE contractor would provi de if the
662 property owner paid for the improvement in cash.
663 (f) A program administrator may not provide any direct
664 cash payment or other thing of material value to a property
665 owner explicitly conditioned upon the property owner entering
666 into a financing agreement. However, a program administrator may
667 offer programs or promotions that provide reduced fees or
668 interest rates if the reduced fees or interest rates are
669 reflected in the financing agreements and are not provided to
670 the property owners as cash consideration.
671 (26) Each local government that has authorized a
672 qualifying improvement program shall post on its website an
673 annual report for the period ending December 31 each year
674 containing the following information:
675 (a) The number of qualifying improvements funded.
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FLORIDA H O U S E 0 F REPRESENTATIVES
PCS for HB 387 2021
676 (b) The aggregate, average, and median dollar amounts of
677 annual and total number of assessments that funded qualifying
678 improvements.
679 (c) The percentage, the number, and the dollar value of
680 assessments that funded qualifying improvements, represented by
681 the category types consisting of energy efficiency, renewable
682 energy, and wind resistance.
683 (d) The number of defaulted assessments including the
684 total number and defaulted amount, the number and dates of
685 missed payments, the total number of parcels defaulted and years
686 in default, and the percentage of defaults by total assessments.
687 (e) A s umma ry of all reported violations of this section,
688 including the resolution of each.
689 (f) Estimated number of jobs created.
690 (g) The number and percentage of homeowners 60 years of
691 age or older participating in a qualifying improvement p rogram.
692
693 This report shall be posted no later than April 1 of the year
694 following the calendar year covered by the report.
695 Section 2. This act shall take effect July 1, 2021.
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