Southfield, MI (PRWEB) April 03, 2014
Lean & Green Michigan announced today the first privately financed Property Assessed Clean Energy (PACE) project in Michigan. The project involves over $1,000,000 of improvements to the 1-800-Law-Firm building at 26700 Lahser Road in Southfield. Over $500,000 will be financed through PACE, an innovative new tool that allows any business to use a property tax assessment to obtain much longer term financing than is otherwise available in the capital markets.
Andy Levin, the President of Lean & Green Michigan and the administrator of Southfield’s PACE program said, “Today marks the beginning of a new era of cost saving for Michigan businesses of all kinds. The door is now wide open for businesses to save money by making their buildings more efficient and producing their own clean energy.”
Lean & Green Michigan is a true public-private partnership. Levin congratulated the parties that came together to achieve this historic deal:
- The City of Southfield, which was the very first jurisdiction to create a PACE district with Lean & Green Michigan. “Mayor Brenda Lawrence, the City Council, and the city’s hard working professional staff all played big roles in reaching this historic day.”
- Ari Kresch, CEO of 1-800-Law-Firm. “Today’s announcement derives above all from the vision of Ari Kresch. Not satisfied to have made his building more efficient, today he is adding solar and wind generating capacity, electric vehicle charging stations, and additional efficiency measures. Ari understands the power of PACE to transform our commercial and industrial building stock.”
- Srinergy, the turnkey solar projects development company: “Srinergy President Prasad Gullapalli represents the can-do, entrepreneurial spirit that will bring Michigan back – and make it a center of the clean energy economy.”
- Comerica Bank: “Comerica banker Joe Vassallo provided up-front capital and consent for the PACE portion of financing, helping to give birth to this innovative new finance market in Michigan.”
The 1-800-Law-Firm PACE project already boasts a signed term sheet and project development contract. The parties expect the last approvals required for the project to be completed by the City of Southfield next month; that the PACE financing will close then; and that construction will be complete by early summer.
Background on Lean & Green Michigan and PACE
Property Assessed Clean Energy (PACE) is taking the nation by storm. Between 2008 and 2013, 31 states and the District of Columbia passed PACE statutes. These state PACE laws empower local governments to use the property tax system to facilitate long-term financing for clean energy projects. According to PACENow, thecommercial PACE market doubled between 2010 and 2013, and is poised for continued growth.
PACE is a game changer because it enables lenders to finance projects over ten to twenty years. Many clean energy projects don’t pay off for eight or ten or fifteen years, while traditional commercial loans generally have terms of only three to five years. This mismatch has left many valuable clean energy projects stuck with no effective way to finance them. By allowing the use of the special assessment mechanism by private parties to achieve a public good, PACE breaks open the market for clean energy economic development without the use of taxpayer dollars.
Lean & Green Michigan is a statewide PACE program open to all Michigan counties and cities for free. Already, six counties and two cities with a total population of 3,645,976 (37% of all Michiganders) have joined Lean & Green Michigan:
- Counties: Huron, Ingham, Macomb, Saginaw, Washtenaw, and Wayne
- Cities: Rochester Hills and Southfield
- More jurisdictions are joining all the time.
Michigan’s PACE statute covers for-profit and non-profit business property of all kinds. Business property owners can finance almost any combination of clean energy improvements to their buildings through PACE, including energy and water efficiency measures and renewable energy generation. In general, for a project to be approved it must be cash flow positive for the property owner. That means that the energy savings must be greater than the payments throughout the life of the finance term.
Lean & Green Michigan takes a market-oriented approach to PACE, allowing property owners to work with contractors and lenders of their choice. By creating one big, flexible market for the state, Lean & Green Michigan seeks to unleash the pent-up demand for energy efficiency, water efficiency, and renewable energy in order to achieve many goals: save property owners money; create more business for Michigan contractors and manufacturers of clean energy products; put people to work retrofitting buildings; update our commercial and industrial property stock to make us more competitive; and significantly reduce carbon emissions.
PACENow is a non-profit foundation funded advocate for Property Assessed Clean Energy (PACE) financing. PACENow’s mission is to promote improved energy efficiency in buildings and use of PACE. Our strategy is to be a trusted source for information and resources to a growing coalition of PACE stakeholders that includes local governments, businesses, industry service providers, labor and trade organizations, environmental groups and private individuals nationwide.
For more information about the 1-800-Law-Firm project, PACE or Lean & Green Michigan, contact Lean & Green Michigan President Andy Levin at andy(at)levinenergypartners(dot)com or 248-808-1420.