HomeMy WebLinkAboutRes 08-89 and C28140 Establishing Energy Independence Program (EIP) CITY OF PALM DESERT
STAFF REPORT
REQUEST: CONSIDERATION OF ADOPTION OF RESOLUTION NO. 08-g�
IN CONNECTION WITH ESTABLISHING THE CITY OF PALM
DESERT ENERGY INDEPENDENCE LOAN PROGRAM
SUBMITTED BY: Patrick Conlon, Director of the Office of Energy Management
DATE: August 28, 2008
CONTENTS: RESOLUTION NO. 08-89
ENERGY INDEPENDENCE LOAN PROGRAM REPORT AND
ADMINISTRATIVE GUIDELINES
CITY CONTRACT# c2814o WITH WILLDAN SERVICES
2008-2009 ENERGY INDEPENDENCE LOAN PROGRAM
BUDGET BREAKDOWN OF COSTS AND SERVICES
Recommendation: By Minute motion City Council adopt the following:
1) Adopt Resolution No. 08- 89 , A Resolution of the City Council of the
City of Palm Desert Approving the Report of the Director of the City's
Office of Energy Management in Connection with the Proposed
Establishment of a Contractual Assessment Program pursuant to
Chapter 29 of Part 3 of Division 7 of the California Streets and
Highways Code; Establishing a Program To Finance Distributed
Generation Renewable Energy Sources and Energy Efficiency
Improvements; Appropriating Moneys from the General Fund To Fund
the Program; Confirming Assessments To Be Levied within the
Parameters of the Report; Amending Resolution No. 08-75; and Taking
Certain Other Actions.
2) Authorize the Director of Finance to appropriate $2.5 million dollars
from unobligated General Fund Reserves to Palm Desert Energy
Independence Loan Fund for this program.
3) Approve city contract # C- 2s14o with Willdan Financial Services
for providing assessment levy administration services necessary for this
Energy Independence Loan Program. There is no cost to the City for
this service as costs will be borne by the loan applicants.
4) Authorize the transfer of $160,000 from the unallocated General Fund
reserves to Office of Energy Management's Advertising and Promotion
account # 110-4511-422-3223.
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Executive Summarv:
Approval of the attached Energy Independence Program Report and Administrative
Guidelines is required in order for the City to establish a contractual assessment
program to finance the installation of distributed generation renewable energy sources
and energy efficiency improvements that are permanently fixed to real property in the
City.
Backqround:
On July 21, 2008, the Governor signed into law AB 811, which became effective
immediately as an emergency measure. The bill authorizes cities to establish a
program to enter into contractual assessment agreements with property owners to
finance the installation of distributed generation renewable energy sources or energy
efficiency improvements that are permanently fixed to real property. In summary, an
AB 811 program allows cities to make a loan to property owners for the purchase and
installation of such improvements. Property owners repay the loan through a
contractual assessment on their property. The contractual assessments are coflected
on property owner's tax bills at the same time and in the same manner as property
taxes.
On July 21, 2008, the City Council Adopted Resolution No. 08-75 declaring its intent to
establish the Energy Independence Program ("EIP") pursuant to AB 811. Resolution
No. 08-75, among other things, briefly described the proposed arrangements for
funding the EIP, directed the Director of the City's Office of Energy Management (the
"Director") to prepare a report as required by AB 811 and set August 28, 2008 as the
date for a public hearing on the EIP. Pursuant to AB 811, the City Clerk provided
notice of the public hearing by publishing Resolution No. 08-75 once a week for two
weeks in the Desert Sun.
AB 811 requires the report to provide all of the following:
1) A map showing the boundaries of the territory within which contractual
assessments are proposed to be offered.
2) A draft contract specifying the terms and conditions that would be agreed to by a
property owner and the City.
3) A statement of City policies concerning contractual assessments including all of
the following:
a. Identification of types of facilities, distributed generation renewable energy
sources, or energy efficiency improvements that may be financed through
the use of contractual assessments;
b. Identification of a city official authorized to enter into contractual
assessments on behalf of the City,
c. A maximum aggregate dollar amount of contractual assessments; and
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d. A method for setting requests from property owners for financing through
contractual assessments in priority order in the event that requests appear
likely to exceed the authorization amount.
4) A plan for raising a capital amount required to pay for work perFormed pursuant
to contractual assessments, including a statement of or method for determining
the interest rate and time period during which contracting property owners would
pay any assessment; whether the City wilf provide for any reserve fund or funds;
and the apportionment of all or any portion of the costs incidental to financing,
administration, and collection of the contractual assessment program among the
consenting property owners and the City.
5) A report on the results of the consultations with the County Auditor-Controller's
Office regarding the additional fees that will be changed to the City for
incorporating the proposed contractual assessments into the assessments of
general taxes of the City on real property, and a plan for financing the payment of
those fees.
Staff prepared the Energy Independence Program Report and Administrative Guidelines
(the "Report") to comply with the requirements of AB 811. The Report is on file with the
City Clerk.
Discussion:
A. The Report. Resolution No�$_-89approves the Report and establishes the EIP as
provided in the Report. In addition to satisfying the requirements of AB 811, the Report
provides the guidelines for administering the EIP. A brief description of the Report
follows.
EIP Administration. The EIP will be administered by the City's Office of Energy
Management (the "OEM"). EIP loans are available for owners of improved real property
in the City. EIP loans are not available for properties that do not pay property taxes.
EIP loans are available for a broad range of energy efficiency improvements, solar
systems and custom energy measures (the "Energy Improvements"), which are
described in Appendix A to the Report. OEM will offer property owners on-site surveys
to advise property owners about potential Energy Improvements, the estimated costs of
Energy Improvements and the estimated savings through EIP.
EIP Process. Property owners may request EIP loans for the costs of equipment
for and installation of Energy Improvements by submitting an application (the
"Application"). A draft application is provided in Appendix C to the Report. Installation
costs may include, but are not limited to, labor, drafting, engineering, permit fees and
inspection charges. Instatlation of Energy Improvements can be completed by a
qualified contractor or by the property owner. OEM reviews the submitted Applications
on a first come-first-served basis to determine, among other things, that the applicant
owns the property, that the proposed improvements are eligible for an EIP loan and that
the costs of the Energy Improvements are reasonable.
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Upon Approval of an Application, the City and property owner may enter into a
contractual assessment agreement (the "Loan Contract"). A draft Loan Contract is
provided in Appendix D to the Report. The City will record an assessment lien against
the property upon execution of the Loan Contract and assessment installments will be
collected from the property owner with property taxes.
Energy Improvements must be completed 180 days after executing a Loan Contract.
OEM disburses EIP loan funds to a property owner after OEM determines that the
Energy Improvements have been satisfactorily completed. The amount of funds to be
disbursed will not exceed the lesser of the maximum loan amount in the Loan Contract
or the actual costs of the Energy Improvements. Prior to completion of an Energy
Improvement and after satisfying certain conditions, OEM may make a progress
payment for EIP loans that exceed $20,000.
ElP Financing. The City will establish an Energy Independence Loan Program
Fund that may accept funds from any available source for the purpose of funding EIP
loans. Assessment installments will be deposited into the Energy Loan Program Fund
and may be used to reimburse City advances or to make EIP loans.
Pursuant to the Report, the maximum total aggregate dollar amount of contractual
assessments is limited to $25 million. Resolution No. os-s9 directs that an initial
$2.5 million is appropriated from the General Fund to the Energy Loan Program Fund.
At least $1.25 million of this amount would be reserved for EIP loans to residential
property owners. However, the City Council may adjust this amount at its discretion
based on program participation.
The minimum EIP loan amount is $5,000 and there is no maximum EIP loan amount.
ELP loans greater than $60,000 must be approved by the City Manager and ELP loans
greater than $200,000 must be approved by the City Council.
Pursuant to the Report, the maximum term for EIP loans is 20 years. Additionally, for
Loans made from the initial $2.5 million, the interest rate cannot exceed 7%. For EIP
loans entered into thereafter, the City Council may set the interest rate at an amount
that does not exceed 10%. For a comparison, the average yield on the City's current
portfolio of investments is 3.7%.
The City may issue notes or bonds or enter into agreements with utilities, or public or
private lenders or other governmental entities and quasi-governmental entities to
reimburse the General Fund for the initial deposit to the Energy Independence Loan
Fund.
Staff has recommended that initial loans be made at 7.00% for up to 20 years. Under
current market conditions, the City could borrow money in the taxable municipal bond
market at 8.00% for 20 years. Therefore, the City could realize a negative spread
between the interest rate on the loans (7.00%) and the interest rate on the bonds
(8.00%). This negative spread is currently estimated at $525,000 for the period of the
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initial loan program. The Staff would only recommend accessing the bond market
should one of two things occur:
1) City Council decides to not continue to fund the program from additional General
Fund contributions and would need to borrow to reptenish the loan fund
2) Other possible cheaper financing sources are not available
Should the City find another source to finance these loans that is at or below the 7.00%
loan rate, the City could realize a positive spread to the program to cover administrative
costs or to make additional loans. The City could always continue to fund the loan
program from General Fund sources and use the rate on the loans to repay the General
Fund at the LAIF or other pooled cash rate and to cover administrative costs of
operating the program. These findings are under current market conditions and
continually subject to change. Once the initial loans are made, the Staff and finance
team members will continue to expfore financing options and bring these back to the
City Council with updates and or recommendations.
8. Amendments to Reso/ution No. 08-75. Resolution No os-89amends certain
provisions contained in Resolution No. 08-75 regarding the issuance of bonds. In the
event bonds are issued, Resolution No. 08-75 provides that the bonds may not bear an
interest rate in excess of 7%, provides a maximum maturity of 15 years for such bonds
and declares that the City will not obligate itself to advance available funds from the City
treasury to cure any deficiency which may occur in the bond redemption fund.
Resolution No. os-89 amends those provisions to provide that in the event bonds
are issued, the bonds may not bear an interest rate in excess of 12%, the maximum
maturity for such bonds is 40 years and the City may obligate itself to advance available
funds from the City treasury to cure any deficiency which may occur in the bond
redemption fund.
C. Other provisions of Reso/ution No . Resolution No08.-8also provides the following
in connection with the EIP: `
• Establishes the Energy Independence Loan Fund.
• Appropriates $2.5 million from the General Fund to the Energy
Independence Loan Fund.
• Confirms the contractual assessments to be levied within the
parameters of the Report.
• Directs the Director to file with the City Treasurer and to revise as
appropriate a list of the parcels for which the City and property owner
have entered into a Loan Contract.
• Directs the City Clerk to cause to be recorded in the office of the
County Recorder a notice of assessment upon the execution of any
Loan Contract.
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• Authorizes and Directs the Director and City Manger, jointly and
severally, to do all acts and things which may be required of them in
carrying out the ELP and all matters incidental thereto, including to
make clarifying changes to the Report and to modify the draft
Application and draft Contract included therein.
The Willdan Financial Services contract is necessary to cover the customary
assessment district administration services for this program. This cost will not exceed
$40 per parcel per year and will be added to the property tax bill.
Attached to this report is a breakdown of costs and services for advertising and
promotions which staff recommends for this program.
Submitted by: Approval:
Pat ick Conlon Carlos Ort
Director, Office of Energy Management City Manager
�v'tZ'Y COUNCIL ACTION:
APPROVED f� DENIED
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RESOLUTION NO. 08-89
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
PALM DESERT APPROVING THE REPORT OF THE DIRECTOR
OF THE CITY'S OFFICE OF ENERGY MANAGEMENT IN
CONNECTION WITH THE PROPOSED ESTABLISHMENT OF A
CONTRACTUAL ASSESSMENT PROGRAM PURSUANT TO
CHAPTER 29 OF PART 3 OF DIVISION 7 OF THE CALIFORNIA
STREETS AND HIGHWAYS CODE; ESTABLISHING A
PROGRAM TO FINANCE DISTRIBUTED GENERATION
RENEWABLE ENERGY SOURCES AND ENERGY EFFICIENCY
IMPROVEMENTS; APPROPRIATING MONEYS FROM THE
GENERAL FUND TO FUND THE PROGRAM; CONFIRMING
ASSESSMENTS TO BE LEVIED WITHIN THE PARAMETERS OF
THE REPORT; AMENDING RESOLUTION NO. 08-75; AND
TAKING CERTAIN OTHER ACTIONS
RECITALS:
WHEREAS, on July 24, 2008, the City Council adopted its Resolution No. 08-75
(the "Resolution of Intention"), declaring its intention to finance distributed generation
renewable energy sources and energy efficiency improvements through the use of
contractual assessments pursuant to Chapter 29 of Part 3 of Division 7 of the California
Streets and Highways Code (the "Act"); and
WHEREAS, the Resolution of Intention ordered the Director of the City's Office
of Energy Management (the "Director") to make and file with the City Clerk a report (the
"Report") in accordance with Section 5898.22 of the Act and the Director has filed the
Report with the City Clerk; and
WHEREAS, the Resolution of Intention set the time and place for a hearing on the
proposed Energy Independence Program(the "Program") as described in the Report; and
WHEREAS,the Resolution of Intention described the proposed arrangements for
funding the Program, including certain parameters in the event that the City determines to
issue in the event improvement bonds will be issued pursuant to Streets and Highways
Code Section 5898.28 to represent assessments; and
WHEREAS, on August 28, 2008, following notice duly given in accordance with
law, the City Council held a full and fair public hearing at which interested persons were
afforded the opportunity to object to, inquire about or provide evidence with regard to the
proposed Program or any of its particulars, including the extent of the area proposed to be
included within the Program, the terms and conditions of the draft contract (described
below), or the proposed financing provisions; and
Resolution No. 08-89
WHEREAS, the Report contains (a) a map showing the boundaxies of the
territory within which the Program is proposed to be offered, (b) a draft application for
participation in the Program (the "Application"), (c) a draft contract (the "Contract")
specifying the terms and conditions that would be agreed to by a property owner and the
City for participation in the Program, (d) a statement of city policies concerning
contractual assessments including: (1) identification of types of facilities, distributed
generation renewable energy sources, or energy efficiency improvements that may be
financed through the use of contractual assessments (the "Authorized Equipment List"),
(2) identification of a City official authorized to enter into contractual assessments on
behalf of the City, (3) a maximum aggregate dollar amount of contractual assessments,
(4) a method for setting requests from property owners for financing through contractual
assessments in priority order in the event that requests appear likely to exceed the
authorization amount, (e) a plan for raising a capital amount required to pay for work
performed pursuant to contractual assessments, (fl a statement of or method for
determining the interest rate and time period during which contracting property owners
would pay any assessment, (g) the establishment of any reserve fund or funds, (h) the
apportionment of all or any portion of the costs incidental to financing, administration,
and collection of the contractual assessment program among the consenting property
owners and the City, and (i) a report on the results of the consultations with the County
Auditor-Controller's office; and
WHEREAS, the City Council, having considered all oral and written testimony,
desires to approve the Report and proceed with the establishment of the Program;
NOW, THEREFORE, BE IT RESOLVED, DETERMINED, AND
ORDERED BY THE CITY COUNCIL OF THE CITY OF PALM DESERT AS
FOLLOWS:
Section 1. The above recitals are all true and correct.
Section 2. The City Council declares that the Report as filed is hereby approved.
Section 3. The City Council hereby establishes the Program to be implemented as
provided in the Report.
Section 4. The City Council hereby establishes a special trust fund held by the City
called the "Energy Independence Fund." Moneys in the Energy Independence Fund shall
be used and disbursed for the purpose of funding the Program.
Section 5. The City Council hereby authorizes and directs the Director of Finance of
the City to transfer from the City General Fund to the Energy Independence Fund the
amount of$2.5 million.
Section 6. The City Council hereby confirms the contractual assessments to be levied
within the parameters of the Report.
Resolution No. 08-89
Sec_. The Director is hereby directed to file with the City Treasurer and to
revise, as appropriate, a list of the parcels for which the City and a property owner have
entered into a contractual assessment agreement (each, a "Loan Agreement") pursuant to
the Program.
Section 8. The City Council hereby appoints and designates the Director to perform
the duties and functions of the Superintendent of Streets in connection with the Program.
Sect=. Upon the execution of any Loan Agreement by all parties thereto pursuant
to the Program, the City Clerk is hereby directed to cause to be recorded in the office of
the Superintendent of Streets and in the office of the County Recorder of the County of
Riverside an assessment diagram as provided by Section 3114 of the California Streets
and Highways Code.
Sect_. After recording in the office of the County Recorder of the County of
Riverside an assessment diagram pursuant to Section 9 hereof and prior to the
disbursement of any loan proceeds pursuant to a Loan Agreement, the City Clerk is
hereby directed to cause to be recorded in the office of the County Recorder of the
County of Riverside a notice of assessment in the form and content approved by the
Director, as provided by Section 3114 of the California Streets and Highways Code.
Sect_. Section 6 of Resolution No. 08-75 is hereby amended to read as follows:
"The proposed arrangements for financing the contractual assessment financing
program are briefly described as follows: The City may issue bonds pursuant to Chapter
29, the principal and interest of which would be repaid by contractual assessments.
Alternatively,the City may advance its own funds to finance work to be repaid through
contractual assessments, and may from time to time sell bonds, notes, certificates of
participation or other forms of indebtedness to reimburse itself for such advances. The
proposed financing arrangements may include the lease-purchase of public facilities by
the City pursuant to a lease or other contractual arrangement with a public financing
authority or non profit entity or other financing elements as may be determined necessary
or useful to the financing of the contractual assessment program.
In the event improvement bonds will be issued pursuant to Streets and Highways
Code Section 5898.28 to represent assessments, all of the following will apply:
(a) Division 10 (commencing with Section 8500) of the Streets and
Highways Code ("Division 10") shall apply to any bonds issued
pursuant to Section 5898.28, insofar as that division is not in
conflict with Chapter 29.
(b) Provision is hereby made for the issuance of improvement bonds,
in one or more series;
(�) Notice is hereby given that serial bonds or term bonds or both to
represent unpaid assessments, and to bear interest at the rate of not
to exceed 12 percent per year, or such other amount authorized by
Resolution No. 08-89
law, payable semiannually, shall be issued hereunder in one or
more series in the manner provided by the Division 10 (to the
extent not in conflict with Chapter 29), and the last installment of
bonds shall mature a maYimum of 39 years from the second day of
September next succeeding 12 months from their date.
�d) The City Council hereby determines and declares that the City may
obligate itself to advance available funds from the City treasury to
cure any deficiency which may occur in the bond redemption fund.
�e) The City Council hereby determines that the principal amount of
bonds maturing or becoming subject to mandatory prior
redemption each year shall be other than an amount equal to an
even annual proportion of the aggregate principal amount of the
bonds, and the amount of principal maturing or becoming subject
to mandatory prior redemption in each year plus the amount of
interest payable in that year shall be an aggregate amount that is
substantially equal each year, except for the moneys falling due on
the first maturity or mandatory prior redemption date of the bonds
which shall be adjusted to reflect the amount of interest earned
from the date when the bonds beaz interest to the date when the
first interest is payable on the bonds.
�� With respect to the procedures for collection of assessments and
the advance retirement of bonds, the City Council proposes to
proceed under the provisions of Part 11.1 of Division 10
(commencing with Section 8670 of the Streets and Highways
Code)."
Sect_. The Director and the City Manager are hereby authorized and directed,
jointly and severally, to do all acts and things which may be required of them by this
Resolution, or which may be necessary or desirable in carrying out the Program and all
matters incidental thereto, including without limitation, to make clarifying changes to the
Report and to modify as deemed necessary by the Director or City Manager the
Authorized Equipment List,the draft Application and the draft Contract included therein.
PASSED, APPROVED AND ADOPTED this day of 20 b the
following vote: —' y
AYES:
NOES:
ABSENT:
ABSTAIN:
Resolution No. 08-89
Mayor
ATTEST:
City Clerk
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Energy Independence Program Re ort
p
and
Administrative Guidelines
Outline
lntroduction
Goals
Background
Benefits
Program Administration
Program Requirements
Eligib/e Property Owners
Eligib/e Properties
Eligib/e Equipment
Eligib/e Costs
Tracks for Participation
The Efficiency Track
The So/ar Track
The Custom Measure Track
Financial Strategy
Energy Surveys and So/ar Site Checks
Energy/ndependence Program Parameters
Minimum Loan Amount
Maximum Loan Amount
Maximum Porlfolio
Duration
lnterest Rate
Administrative Fees
Changes to Report
Appendices
A. Equipment List
B. Map of Program Area
C. Draft Program Application
D. Draft Loan Contract
E. Summary of Loan Process
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Introduction
This Report has been prepared pursuant to Section 5898.22 of the California Streets and
Highways Code in connection with the establishment of the City of Palm Desert Energy
Independence Program ("EIP"). This is the guiding document for EIP and fulfills the
Section 5898.22 requirements that this report contain:
1. A man showing the boundaries of the territory within which contractual
assessments are proposed. (See Appendix B.)
2. A draft contract between a property owner and the City. (See Appendix D.)
3. Cit�policies concerning contractual assessments.
4. A plan for raisin a capital amount to pay for the work performed.
The Energy Independence Program described herein is designed to help Palm Desert
property owners save energy and gain independence from the scarcity of sources of
energy that are compromising the California power grid, threatening national security,
and endangering the global climate.
The Energy/ndependence Program he/ps Pa/m Desert property owners
save energy and money whi/e doing right for the environment.
Goals
EIP will carry out the City's mission of helping property owners of improved real
property make principled investments in the long-term health of the local, state, and
national economy and global environment.
EIP aims to provide multiple benefits. By enabling property owners to take responsible
energy actions, the program seeks to cut their utility bills. At the same time it shores up
the local economy,the California power grid, and national and global energy interests,
and makes it possible for Palm Desert to fulfill energy conservation and climate
protection commitments.
The City has established a goal to reduce electric and natural gas energy consumption by
30%. The City welcomes innovative energy solutions that will contribute to this goal.
The City intends to initially fund EIP with $2.5 million for energy reduction investments
that might not have otherwise been possible, with a maximum aggregate amount of$25
million.
Backaround �
As a result of Palm Desert's authorship and advocacy of what became Assembly Bill
811, the bill was approved by the California Legislature, signed into law by the Governor
on July 21, 2008 and became immediately effective as an urgency measure. Under this
bill, the California Legislature has declared that a public purpose will be served by a
contractual assessment program that provides the local government with the authority to
finance the installation of distributed generation renewable energy sources—such as solar
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-- and energy efficiency improvements that are affixed to residential, commercial,
industrial, or other real property(collectively known as "Energy Improvements").
To make Energy Improvements more affordable and to promote their installation, AB
811 provides procedures for authorizing voluntary assessments to finance the cost of
these improvements. The Energy Independence Program works with the free and willing
consent of owners of the property on which the Energy Improvements are to be made.
The City will make loans ("EIP Loans")to property owners within the City to finance the
installation of Energy Improvements pursuant to contractual assessment agreements.
Property owners in the City will repay EIP Loans through an assessment levied against
their property which is payable in semi-annual installments on property tax bills.
Proqram Benefits
From the CitY's ers ective, the Energy Independence Program will be a key element in
achieving the City's 30% energy reduction goals. EIP provides a significant channel for
funneling more resources into the shift to greater efficiency and renewable energy, while
securing the energy future. For example, $25 million of energy efficiency and renewable
energy investments has the potential to provide over$50 million in direct consumer
benefits over time while contributing to regional, state, national and international goals.
For�ro�erty owners, EIP offers:
■ A no-money-down means of financing Energy Improvements.
■ Fixed-rate loans.
■ Financing without requiring a property appraisal.
■ A stream-lined loan process.
Proaram Administration
EIP will be administered by the City's Office of Energy Management("OEM"), which is
headed by the Director of the Office of Energy Management(the "Director") and staffed
by EIP professionals. EIP staff will be responsible for:
■ Community outreach
■ Energy surveys
■ Solar site checks
■ Advising property owners
■ Processing loan applications
■ Managing and tracking funds available for EIP Loans
■ Monitoring individual and collective energy conservation
■ Integrating EIP with Palm Desert's successful Set to Save rebate program.
The intent of these services is to provide a "turn-key" service for Palm Desert property
owners who would otherwise be unable or unwilling to finance efficiency measures and
renewable energy options. Their participation is critical to the City in achieving its 30%
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energy reduction goals and for the State to meet its greenhouse gas commitments to
reduce carbon emissions to 19901evels by 2020.
Program Requirements
Eliaible Propertv Owners
All owners of improved real property are eligible for the Energy Independence Program.
Owners may be individuals, associations, business entities, cooperatives, and virtually
any owner which pays real property taxes.
A property owner needs to be current in the payment of property taares. Property owners
are eligible to make multiple applications for additional Energy Improvements.
Eliaible Proqerties
EIP Loans are available to all owners of improved real properties in the City including,
but not limited to, residential, commercial, and industrial properties. Unfortunately at this
time, EIP Loans are not available for properties that do not pay property taxes, such as
governmental entities and certain non-profit corporations.
EliQible Eauiament
EIP affords property owners in Palm Desert the opportunity to take advantage of a wide
range of energy-savings measures, consistent with the following provisions:
1. EIP provides financing for Energy Improvements that are permanently affixed to
property.
2. EIP Loans are specifically made available for Energy Improvements. Property
owners that elect to engage in broader retrofit projects—such as home or business
remodeling—will only be provided EIP Loans for that portion of the costs used to
retrofit existing structures with Energy Improvements. (This is discussed further
in Eligible Costs.)
3. EIP Loans are intended for retrofit activities to replace outdated equipment and to
install new equipment that takes energy off the grid. However, EIP Loans are
also made available for purchasers of new homes and businesses that wish to add
Energy Improvements after the property owner takes title to the property.
4. EIP Loans are made available for the following types of improvements that are
presented in greater detail in Appendix A:
a. Efficiencv Measures. EIP supports a wide range of efficiencv measures as
presented m Annendix A EIP also sut�ports Energv Improvements that are
eli�ible for Set to Save pro�ram rebates
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b. Solar Svstems. EIP Loans will be available for a range of solar systems,
from photovoltaic to solar thermal.
c. Custom Measures. Upon review and approval by the Office of Energy
Management, EIP Loans are made available for emerging technologies for
Energy Improvements that provide new ways to save or generate energy
and that will be evaluated on a case-by-case basis.
5. EIP is flexible and provides three "Tracks" for participation that focus on
Efficiency Measures, Solar Systems, and Custom Measures. See "Tracks for
Participation"below for more information.
6. EIP Loans are also made available for combinations of Energy Improvements
such as bundling energy efficiency and renewable energy measures. For instance,
a property owner may choose to replace both an aging and inefficient air
conditioner and install a solar system.
Eliqible Costs
Eligible costs of the Energy Improvements include the cost of equipment and installation.
Installation costs may include, but are not limited to, labor, drafting, engineering,permit
fees, and inspection charges.
The installation of Energy Improvements can be completed by a qualified contractor of
the property owner's choice. Eligible costs do not include labor costs for property
owners that elect to do the work themselves.
In each case, the Office of Energy Management will determine whether the estimated
equipment and installation costs are reasonable. The OEM will evaluate market
conditions and may require additional bids to determine whether costs are reasonable.
While the property owner will be able to select the bidder of his or her choice, the amount
available for the EIP Loan may be limited to an amount deemed reasonable by the OEM,
and may be reviewed by the City Manager and the Palm Desert City Council.
Tracks for Participation
There are three ways for property owners to participate in the Program. Eligible
equipment and standards are presented in greater detail in Appendix A:
The Efficiencv Track
The Efficiency Track covers a wide range of energy efficiency fixtures, from windows
and doors, attic insulation that are Energy Star rated. Packaged and central air
conditioning systems must meet the minimum efficiencies specified in the Set to Save
program. Given Palm Desert's preponderance of pools, specific efficiency requirements
are presented for pool pumps and heaters. All other efficiency measures must go through
the Custom Measure Track. .
5
The Solar Svstem Track
The Solar System Track makes available Energy Independence Program loans for Energy
Improvements. The Solar Track also helps property owners with solar electric and solar
thermal investments by offering optional, no-cost solar site checks and consultation by
EIP experts.
Custom Measure Track
All other proposed measures follow the Custom Measure Track. These measures may
include renewable energy sources (other than solar), such as wind, geothermal, and
potentially solar-hydrogen fuel cells, as well as more complex and innovative energy
management solutions and emerging technologies. The development of technologies are
encouraged by EIP as a means of diversifying the City's energy sources.
Applicants for the Custom Measure Track should consult the OEM to determine
eligibility. In some cases, the findings of national energy laboratories and nationally
accredited research and testing centers will be required far EIP approval. In all cases, the
City reserves the right to decline funding of a custom measure.
Energy Surveys and Solar Site Checks
The Office of Energy Management offers energy surveys at owners' properties. During
these on-site surveys, a trained Program expert will review as appropriate, energy
efficiency, energy management, and renewable energy opportunities and EIP financial
details with the property owner. The property owner will then be advised as to the
potential Energy Improvements, their estimated costs and savings through EIP
participation.
Energy surveys are highly recommended but not required.
The Financial Strategy
The City will create the Energy Independence Program Fund which may accept funds
from any available source and which may disburse such funds for the purpose of funding
Energy Improvements. Loan repayments—through the property assessment mechanism
—will be made to the Energy Loan Fund.
The City initially will seed the Energy Loan Fund with$2.5 million from the General
Fund. Thereafter,the Energy Loan Fund may be funded from a number of other potential
sources, and combinations of sources, which may include but are not limited to additional
funding from the General Fund,the issuance of notes, bonds, or agreements with utilities
or public or private lenders or other governmental entities and quasi-governmental
entities such as CALPERS.
6
EIP Funds will then be used by the City for additional EIP Loans andlor to establish a
Reserve Fund or pay administrative costs and/or to reimburse itself for advancing moneys
from the General Fund to the EIP Fund.
At a minimum, $1.25 million of the $2.5 million loan amount will be reserved for EIP
Loans for residential property owners. The Office of Energy Management will report on
penetration to the City Manager and Council on a quarterly basis at a minimum,
providing Council with the information necessary to shift funds as it elects to do so at its
sole discretion.
The City may also establish an EIP Reserve Fund if bonds are issued to cover EIP Loan
payments in the event of assessment delinquencies prior to foreclosure and ta�c sale if
deemed necessary by the City Manager and the City Council.
Energy Independence Program Parameters
Minimum Enerqv Loan Amount
The minimum size for an EIP Loan is $5,000.
Maximum Enerqv Loan Amount
There is no ma�imum size for Energy Program Loans. All Energy Loans greater than
$60,000 must be approved by the City Manager. EIP loans greater than $200,000 must be
approved by the City Council.
MaximumPortfolio
The maximum principal amount of the Energy Loans to property owners under the
Program is $25 million. This may be increased by the City Council at its discretion.
Duration
EIP Loans are made available for up to 20-year terms to accommodate a wide range of
efficiency measures and renewable energy investments. The term of the loan is in the
discretion of the property owner in consultation with the Office of Energy Management.
Interest Rate
EIP Loans will be made for the initial $2.5 million an annual interest rate not to exceed
7% for all loans. Thereafter, the City Council will maintain the discretion to adjust the
interest rate up to an amount not to exceed 10%. The Council will determine interest rates
so that the Energy Loan Fund remains financially viable up to the legal limit.
The City will set the interest rate for an EIP Loan at the time that the City and property
owner enter into the contractual assessment agreement.
7
Administrative Fees
The City of Palm Desert will offer the Energy Independence Program as an additional
City service that will help property owners achieve their energy goals, while helping the
City achieve its energy and climate protection goals. The City of Palm Desert will be
responsible for all EIP marketing and outreach, as well as the duties of the Office of
Energy Management.
The City may elect to cover a portion of its costs through the"spread"between its
combined earnings rate, and the EIP Loan issuance rate. Similarly, it may elect to recover
EIP costs through a spread between bond rates and loan rates, or the spread between
interest rates of any financial vehicle. The City will not charge property owners a fixed
administrative fee.
Two forms of costs will be the responsibility of the property owner:
1. Title costs—including title insurance—will be shared by the property owner and
the City. This cost to the property owner will not exceed $200 per EIP Loan
2. Assessment collection costs will appear as a line item on property t�es not to
exceed $40 per property per year—and will be paid by property owners. This cost
was determined after consultation with the County of Riverside Assessor's Office.
Changes to Report
The Director or City Manager may make changes to this Report that the Director or City
Manager reasonably determines are necessary to clarify its provisions. Any changes to
this Report that materially modify the Energy Independence Program shall only be made
after approval by the City Council.
The City Manager or Director may modify from time to time the Equipment List, draft
Loan Contract and draft Application attached hereto as Appendix A, Appendix D and
Appendix C, respectively, as deemed necessary by the City Manager or the Director to
effectuate the purposes of the Program.
8
Appendix A: Equipment List
The Energy Independence Program offers EIP loans for a number of equipment types,
including efficiency measures, solar systems, and other innovative, energy-saving custom
measures. In each case, the use of rebates and tax credits to prepay a portion of the loan
is at the discretion of property owner.
Efficiencv Measures
The Energy Independence Program provides services and loans for a wide range of
Energy Star-rated efficiency measures, including many Set to Save Efficiency Measures
for which property owners can get rebates as well as EIP Loans. Excepting HVAC
equipment as noted below, efficiency measures that are Energy Star rated must meet the
Energy Star minimum efficiency levels.
For all packaged and central air conditioning systems funded in this loan program, the
minimum efficiency levels shall be as required by the current minimum requirements set
forth in Set to Save program.
All other proposed efficiency measures will be considered in the Custom Measure Track.
The City of Palm Desert anticipates that Energy Star requirements will "ratchet up"to
greater efficiency levels over time. Energy Star will also become more inclusive of
technologies over time. Thus the EIP will evolve with Energy Star and the market for
energy-efficient technologies.
The following Energy Star measures—among others—are eligible in the Efficiency
Track.
■ Attic and wall insulation
■ Light fixtures (no bulb-only retrofits)
■ Reflective roofs and coatings
■ Windows, doors, and skylights
Pool Eaui ment
Given the preponderance of pools in Palm Desert the following prescriptive standards
must be upheld for Efficiency Track funding:
o Pool circulating pumps (must be Variable Flow and/or Multi-speed with
controllers)
o Natural gas pool heaters (must have a thermal efficiency of 84%or
greater)
9
Solar Eauipment
Solar Track funding is available for a wide range of solar equipment. EIP Loans will be
available for photovoltaic equipment and installers listed by the California Energy
Commission. Solar thermal equipment must be rated by the Solar Rating Certification
Council (SRCC). As with efficiency measures, the property owner maintains the
discretion as to whether to prepay a portion of the gross loan with any solar rebates and
tax credits.
Eligible solar equipment includes:
■ Solar thermal systems (hot water)
■ Photovoltaic systems (electricity)
o Battery back-up systems will be allowed
o Funding for off-grid systems will be allowed
o PV systems can be sized to accommodate plug-in electric vehicles
Custom Measures
The City of Palm Desert encourages innovation in saving energy to meet its energy-
savings goals. Custom Measures will only be funded for EIP Loans if sufficient proof of
energy savings is provided to the Office of Energy Management that the measure will
reduce usage by 20%. The Director reserves the right to defer funding until he deems the
evidence sufficient to verify this performance requirement.
The following types of ineasures—among others—will be considered for EIP Loans
through the Custom Measure Track:
■ Building Energy Management controls
■ HVAC Duct zoning control systems
■ Irrigation pumps and controls
■ Lighting controls
■ Motors and controls
■ Natural gas fuel cells
' Water heating equipment
o Tank-style
o Tankless
o Central water heating system
As these "Custom Measures" become Energy Star rated they will be included in the
Efficiency Measure Track.
10
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APPENDIX C
PALM DESERT ENERGY INDEPENDENCE PROGRAM
LOAN APPLICATION INSTRUCTIONS
Please complete and sign the attached Application Form and include all requested attachments.
Please type ar print neatly in blue or black ink.
All applications are processed on a first-come, first-served basis, upon receipt, until funds are
depleted. Incomplete and/or incorrect applications cannot be processed. Resubmitted
applications are processed on a first-come, first-served basis upon the new receipt date.
If there are insufficient funds available, an approved applicant will be placed on a waiting list.
Keep a copy for your records of your completed Application and all documents submitted. Keep
a copy of all receipts,paid invoices, and home improvement contracts.
Mail or Deliver your completed Application and attachments to:
City of Palm Desert Office of Energy Management
73-710 Fred Waring Dr. Suite 200A
Palm Desert Calif. 92260
For questions regarding the status of your Application call:
City of Palm Desert Office of Energy Management
(760) 837-0287 Fax: (760) 674-3428
For information on home improvement contracts or the status of your contractor's license visit
www.cslb.ca.gov or call the Contractor's State License Board at 1-800-321-CSLB.
P6401-0001\1073723v9.doc
PALM DESERT
ENERGY INDEPENDENCE PROGRAM
LOAN APPLICATION
The Energy Independence Program provides for the City of Palm Desert to make loans to property owners to
finance the installation of distributed generation renewable energy sources or energy efficiency improvements that
are permanently fixed to the real property. Loans will be made pursuant to Chapter 29 of Part 3 of Division 7 of
the California Streets and Highways Code(commencing with Section 5898.10)and the City of Palm Desert's
Energy Independence Program Report and Administrative Guidelines dated August 28,2008.
APPLICANT INFORMATION
Property Owner(s)Name(s):
Property Address(where improvements are to be installed): Mailing Address(if different):
Contact Name:
Daytime Telephone Number:(_)
E-mail Address:
Property Owner(s)(check one):
_Individual(s) _Corporation LLC
_Trust _Parinership Other,please specify
below
Other:
Are you,or the property described herein,currently involved in a bankruptcy proceeding? ❑ yes ❑ no
P6401-0001\1073723v9.doc 1
PROPERTY INFORMATIOIv
Is property developed? ❑ yeS ❑ na
Property Type
(check one): _Single Family Residential _Multi-Family Residential Commercial
_Industrial Mobile Home Other,please specify
below
Other:
IMPROVEMENTS INFORMATION
Proposed Improvements (please describe and attach separate sheet if necessary):
Itemized Estimated Cost of Improvements:*
A. (i) Construction contract (bid price for cost of materials and labor): or $
(ii) If self-installing, cost of equipment(do not include any labor costs): $
B. Contingency allowance (10% of(i) or(ii) above): $
C. Drafting, engineering and/or plan preparation fees: $
D. Permit fees: �
E. Other(please specify on separate sheet) �
Total �
Requested Loan Amount (minimum loan amount is $5,000): $
* The Applicant will be responsible for one-half of the title costs, not to exceed $200.00 per
Loan. The City of Palm Desert will contribute the balance of the title costs. The Applicant's
share of the title costs can be included in the Loan Amount or the Applicant may pay this cost to
the City in cash at the time of executing the Loan Agreement.
P6401-0001\1073723v9.doc 2
DECLARATIONS:
By signing this Application,the undersigned hereby declares under penalty of perjury under the
laws of the State of California all of the following:
1. I/we am/are all of the current owner(s) of record of the property described herein.
2. I/we am/are not, and the property described herein is not, currently involved in a
bankruptcy proceeding.
3. That(i) the information provided in this Application is true and correct as of the date set
forth opposite my/our signature(s) on this Application and (ii)that I/we understand that
any intentional or negligent misrepresentation(s) of the information contained in this
Application may result in civil liability and/or criminal penalties including, but not
limited to, fine or imprisonment or both under the provisions of Title 18, United States
Code, Section 1001, et seq. and liability for monetary damages to the City of Palm
Desert, its agents, successors and assigns, insurers and any other person who may suffer
any loss due to reliance upon any misrepresentation which I/we have made in this
Application.
4. I/we am/axe applying for a loan pursuant to the City of Palm Desert's Energy
Independence Program. I/we understand that I/we must execute a Loan Agreement with
the City of Palm Desert in order to receive a loan and I/we have the authority, without the
consent of any third party which has not been previously obtained, to execute and deliver
the Loan Agreement, this Application, and the various documents and instruments
referenced herein.
5. I/we understand that the loan made pursuant to the Loan Agreement will be repayable
through an assessment levied against my/our property. The assessment and the interest
and any penalties thereon will constitute a lien against my/our property until they are
paid, even if I/we sell the property to another person. Uwe understand that assessment
installments (including principal and interest)will be collected on my/our property tax
bill in the same manner and at the same time as property taxes and will be subject to the
same penalties, remedies, and lien priorities as for property taxes in the event of
delinquency.
6. That executing the Loan Agreement, receiving the loan proceeds, and consenting to the
assessment levied against my/our property to repay the loan will not constitute a default
under any other agreement or security instrument which effects my/our property or to
which Uwe am/are a party.
7. I/we agree that the selection of product(s), equipment, andlor measures referenced in this
Application(the "EquipmenY'), the selection of manufacturer(s), dealer(s), supplier(s),
contractor(s) and/or installer(s), and the decision regarding the purchase, installation and
ownership/maintenance of the Equipment is/are my/our sole responsibility and that I/we
have not relied upon any representations or recommendations of the City of Palm Desert
in making such selection or decision, and that my manufacturer, dealer, supplier,
P6401-0001\1073723v9.doc 3
contractor or installer of the Equipment is not an agent or representative of the City of
Palm Desert.
8. I/we understand that the City of Palm Desert makes no warranty, whether express or
implied, including without limitation,the implied warranties of inerchantability and
fitness for any particular purpose, use or application of the Equipment.
9. I/we agree that the City of Palm Desert has no liability whatsoever concerning (i)the
quality or safety of the Equipment, including its fitness for any purpose, (ii)the estimated
energy savings produced by the Equipment, (iii)the workmanship of any third parties,
(iv)the installation or use of the Equipment including, but not limited to, any effect on
indoor pollutants, or any other matter with respect to the City of Palm Desert Energy
Independence Program.
10. I/we understand that I/we is/are responsible for meeting all City of Palm Desert Energy
Independence Program requirements and complying with all applicable
Federal/State/County/City laws and the requirements of any agreement which effects the
use of the property(such as homeowner's association requirements, if any).
Signed on this_day of , 20_, in the City of , State of
Property Owner Signature: Printed Name:
Property Owner Signature: Printed Name:
REQUIRED ATTACHMENTS:
❑ Organizational Documents if Property Owner is not an individual(s)
❑ Home Improvement Contract or contractor's bid or proposal, which includes contractor's
name and license number(unless self-installing)
❑ Disclosure Regarding Assessment Financing(please complete and sign)
❑ State of California Fair Lending Notice (please complete and sign)
IF YOUR APPLICATION IS DENIED, YOU HAVE THE RIGHT TO A WRITTEN
STATEMENT OF THE SPECIFIC REASONS FOR THE DENIAL. TO OBTAIN THE
WRITTEN STATEMENT, PLEASE CONTACT THE OFFICE OF ENERGY
MANAGEMENT AT [PROVIDE TELEPHONE NUMBER AND ADDRESS] OR SEND AN
EMAIL TO [PROVIDE EMAIL ADDRESS] WITHIN 60 DAYS FROM THE DATE YOU
ARE NOTIFIED OF THE DENIAL. THE OFFICE OF ENERGY MANAGEMENT WILL
PROVIDE YOU A WRITTEN STATEMENT OF THE REASONS FOR THE DENIAL
WITHIN 15 DAYS OF RECEIVING YOUR REQUEST FOR THE STATEMENT.
THE FEDERAL EQUAL CREDIT OPPORTUNITY ACT PROHIBITS CREDITORS FROM
DISCRIMINATING AGAINST CREDIT APPLICANTS ON THE BASIS OF RACE, COLOR,
RELIGION, NATIONAL ORIGIN, SEX, MARITAL STATUS, AGE (PROVIDED THE
APPLICANT HAS THE CAPACITY TO ENTER INTO A BINDING CONTRACT);
BECAUSE ALL OR PART OF THE APPLICANT'S INCOME DERIVES FROM ANY
P6401-0001\1073723v9.doc 4
PUBLIC ASSISTANCE PROGRAM; OR BECAUSE THE APPLICANT HAS IN GOOD
FAITH EXERCISED ANY RIGHT UNDER THE CONSUMER CREDIT PROTECTION ACT.
THE FEDERAL AGENCY THAT ADMINISTERS COMPLIANCE WITH THIS LAW
CONCERNING THIS CREDITOR IS THE FEDERAL TRADE COMMISSION, EQUAL
CREDIT OPPORTLJNITY, WASHINGTON, DC 20580.
For Office Use Only
Received in the Office of Energy Management on 20_by
�
P6401-0001\1073723v9.doc $
DISCLOSURE REGARDING ASSESSMENT FINANCING
The Energy Independence Program establishes the manner by which the City of Palm Desert
(the "City")may make loans to property owners pursuant to Chapter 29 of Part 3 of Division 7
of the California Streets and Highways Code (commencing with Section 5898.10)to finance
the installation of distributed generation renewable energy sources or energy efficiency
improvements that are permanently fixed to the owner's real property. Each loan will be made
pursuant to a loan agreement between the City and the property owner.
The loan will be secured by and repayable through an assessment levied by the City against the
owner's property. Each year until the loan is repaid, assessment installments (including principal
and interest)will be collected on the property t�bill for the property in the same manner and at
the same time as property ta�ces. Assessment installments will be subject to the same penalties,
remedies (including foreclosure and sale of the property), and lien priorities as for property ta�ces
in the event of delinquency.
The assessment and each installment thereof, and any interest and penalties thereon,will
constitute a lien against the property until paid even though prior to full payment the property is
conveyed to another person. An assessment lien will be recorded against the owner's property in
the office of the County Recorder of the County of Riverside. Such lien will be paramount to a11
existing and future private liens against the property, including mortgages, deeds of trust and
other security instruments.
Before completing an Energy Independence Program Application, a property owner should
carefully review any agreement(s) or security instrument(s)which effect the property owner's
property or to which the property owner is a party. ENTERING INTO AN ENERGY
INDEPENDENCE PROGRAM LOAN AGREEMENT WITHOUT THE CONSENT OF
THE OWNER'S EXISTING LENDER(S)COULD CONSTITUTE AN EVENT OF
DEFAULT UNDER SUCH AGREEMENTS OR SECURITY INSTRUMENTS.
DEFAULTING UNDER AN EXISTING AGREEMENT OR SECURITY INSTRUMENT
COULD HAVE SERIOUS CONSEQUENCES TO THE PROPERTY OWNER,WHICH
COULD INCLUDE THE ACCELERATION OF THE REPAYMENT OBLIGATIONS
DUE UNDER SUCH AGREEMENT OR SECURITY INSTRUMENT.
P6401-0001\1073723v9.doc 1 of 2
A property owner must declare under penalty of perjury in the Energy Independence Program
Application that (i)the owner has the autharity, without the consent of any third party which has
not been previously obtained, to execute and deliver the loan agreement, the Application, and the
various documents and instruments referenced therein; and (ii)that executing the loan
agreement, receiving the loan proceeds, and consenting to the assessment levied against the
property owner's property will not constitute a default under any other agreement or security
instrument which effects the property owner's property or to which the property owner is a party.
If you have any questions regarding any agreements or security instruments which effect
your property or to which you are a party or your authority to execute the Energy
Independence Program Application or enter into a loan agreement with the City without
the prior consent of your existing lender(s), the City strongly encourages you to consult
with your own legal counsel and/or your lender(s). City Staff will not provide property
owners with advice regarding existing agreements or security instruments.
I have received a copy of this Notice. I have received a copy of this Notice.
Property Owner Signature: Property Owner Signature:
Printed Name: Printed Name:
Date: Date:
P6401-0001\1073723v9.doc 2 of 2
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P6401-0001\1073723v9.doc
APPENDIX D-1
LOAN AGREEMENT
CITY OF PALM DESERT ENERGY INDEPENDENCE PROGRAM
[SINGLE DISBURSEMENT]
This Loan Agreement ("Agreement") is made and entered into as of this
day of , by and between the CITY OF PALM DESERT a
California municipal corporation ("City") and '
("Borrower").
RECITALS
A. City has established the Energy Independence Program (the "Program")
pursuant to which City may extend loans to property owners to finance the acquisition
and installation on their property of certain qualifying renewable energy systems and
energy efficient equipment. The purpose and method of administration of the loans
under the Program are described in the Energy Independence Program Report adopted
by the City Council on August 28, 2008, as it may be amended from time to time (the
"Report").
B. The Program is authorized by Chapter 29 of Part 3 of Division 7 of the
California Streets and Highways Code (the "Act").
C. The Borrower has submitted to the City that certain Palm Desert Energy
Independence Program Loan Application dated , 200 , a copy of which is
attached hereto as Exhibit "A" and incorporated herein by this reference (the
"Application"). The Application describes, among other things, the renewable energy
system and/or energy efficient equipment which is to be financed with the proceeds of
the loan described herein, and to be constructed on or installed in the property of
Borrower described in Exhibit "B" attached hereto and incorporated herein by this
reference (the "Property"), and the City has approved the Application as provided in the
Report.
D. The Borrower wishes to participate in the Program by executing this
Agreement with the City and using the proceeds of the loan made by the City to the
Borrower hereunder to finance the acquisition and [construction] [installation] on the
Property of the [renewable energy system] [energy efficiency equipment] described in
the Application (the "Equipment"). The Equipment and its construction on or installation
in the Property is collectively referred to herein as the "Work".
NOW, THEREFORE, in consideration of the mutual covenants contained
herein and other valuable consideration, the receipt and adequacy of which is hereby
acknowledged, the parties agree as follows:
P6402-0201\1077697v6.doc Energy Program Loan Agreement
AGREEMENT
�. Loan Aqreement
(a) Subject to the conditions set forth herein, City agrees to extend a
loan ("Loan") to Borrower in the amount of up to
Dollars ($ ) (the "Loan Amount"). Nofinrithstanding anything to the
contrary contained herein, the Loan Amount shall not in any event exceed the actual
cost of the Work. The Loan Amount shall be adjusted, if necessary, prior to the first
disbursement of the Loan Amount to the Borrower and following the post-completion
inspection by the City's Office of Energy Management ("OEM") as described in
Section 3 below, and shall be adjusted by the Director of the OEM (the "Director") to an
amount equal to the actual cost of the Work. Any adjustment of the Loan Amount by
the Director shall be made on the basis of the best available written evidence of the
actual cost of the Work and in the exercise of the Director's reasonable judgment. The
Borrower shall be solely responsible for the payment of all cost of the Work which
exceeds the Loan Amount and Borrower agrees in any event to complete the Work and
to fund all costs associated with such completion which may be in excess of the Loan
Amount. This Agreement, together with the Application, the Report and the documents
and instruments attached to or referenced in this Agreement and the Application are
collectively referred to herein as the "Loan Documents."
(b) The term of the Loan and this Agreement shall be
(._� years from the date that the proceeds of the Loan are first disbursed to the
Borrower.
(c) Interest shall accrue on the unpaid principal balance of the Loan
Amount from the date first disbursed to Borrower at the simple interest rate of seven
percent (7%) per annum. Interest shall be computed on the basis of a three hundred
sixty (360) day year. If a law which applies to the Loan and which sets maximum
interest rates or loan charges is interpreted by a court of competent jurisdiction in a
manner as would cause the interest or other loan charges collected or to be collected in
connection with the Loan to exceed the limits permitted by such laws, then: (i) any such
interest or loan charge shall be reduced by the amount necessary to reduce the interest
or charge to the permitted limit; and (ii) any sums already collected which exceed
permitted limits will be refunded by the City. The City may choose to make the refund
by reducing the outstanding principal amount of the Loan or by making a direct
payment to the Borrower.
(d) The Borrower promises to pay to the City, without deduction or
offset, the Loan Amount and the interest accrued thereon as provided herein. The
repayment of the Loan Amount and interest accrued thereon shall be repaid by the
Borrower to the City by the payment of an assessment levied against the Property
pursuant to Section 5898.30 of the California Streets and Highway Code (the
"Assessment"). In addition to the Assessment, the Borrower promises to pay to the
City, without deduction or offset, an annual assessment levied against the Property to
pay costs incurred by the City which result from the administration and collection of the
P6402-0201\1077697v6.doc Energy Program Loan Agreement-2
Assessment or from the administration or registration of any associated bonds or
reserve or other related funds (the "Annual Administrative Assessment"). The Annual
Administrative Assessment shall not exceed Dollars ($_�
per year. The Assessment and the Annual Administrative Assessment, and the interest
and any penalties thereon shall constitute a lien on the Property until they are paid.
The installments of the Assessment and the Annual Administrative Assessment
(including principal and interest) shall be collected on the property tax bill pertaining to
the Property, and shall be subject to the same penalties, remedies, and lien priorities as
for property taxes in the event of non-payment. The Borrower hereby expressly
consents to the levy of the Assessment and the Annual Administrative Assessment and
the imposition of the lien on the Property as described herein and in the Act.
(e) The amount of assessment installments that will be placed on the
Property each year is set forth in Exhibit "C" attached hereto and incorporated herein by
this reference.
(fl The Assessment may be prepaid, in whole or in part, at any time
upon the payment of a premium in an amount equal to three percent (3%) of the
amount of the Assessment to be prepaid.
2. Use of Proceeds.
All proceeds of the Loan shall be used by Borrower for the sole purpose
of paying for the reasonable costs and expenses of the Work on the Property, and in
connection therewith the Borrower shall comply with all requirements set forth herein, in
the Application and in the Report.
3. Disbursement Procedures.
(a) Notwithstanding anything to the contrary contained herein, the City
shall have no obligation to disburse the Loan Amount hereunder unless and until each
of the following conditions is satisfied, or any such condition is expressly waived by the
Director:
(i) The receipt by the Director of a written certification from
Borrower, and the contractor(s), if any, that pertormed the Work, stating that the Work
for which disbursement is requested is complete, and the actual cost of such Work.
Such certification shall be in form and substance acceptable to the Director.
by the Director that the Wo k has been complet d�n fu I com�l annce w��ith �h termination
requirements of the Loan Documents. p e
(iii) The receipt by the Director of such other documents and
instruments as the Director may require, including but not limited to, if applicable, the
sworn statements of contractor(s) and refeases or waivers of lien, all in compliance with
the requirements of applicable law.
P6402-0201\1077697v6.doc Energy Program Loan Agreement-3
Director the Loan Docume Bs and such othe documrents or ecuted and delivered to
the Loan or the Work as the Director may require. instruments pertaining to
(�) As of the date of disbursement of the Loan Amount, the
Director shall have determined that the representations of the Borrower contained in the
Loan Documents are true and correct, and no Default (as defined in Section 12 below)
shall have occurred and be continuing.
(vi) No stop payment or mechanic's lien notice pertaining to the
Work has been served upon the City and remains in effect as of the date of
disbursement of the Loan Amount.
(vii) The City shall have received a title policy (the "Title Policy")
in the Loan Amount and insuring the Loan and the lien of the assessments described in
Section 1(d) hereof. The Title Policy shall be in form and substance acceptable to the
Director.
(b) Borrower will, within (___) days of presentation by the
Director, execute any and all documents or instruments required by the Loan
Documents in connection with the disbursement of the Loan Amount.
4. R_e �_{, Ot'�S•
Borrower agrees, upon the request of Director, to promptly deliver to the
Director, or, if appropriate, cause its contractor(s) to promptly deliver to Director, a
written status report regarding the Work.
5• Representations and Warranties of Borrower
Borrower promises that each representation and warranty set forth below
is true, accurate and complete as of the date of this Agreement, and the date of
disbursement of the Loan Amount. The disbursement of the Loan Amount shall be
deemed to be a reaffirmation by the Borrower of each and every representation and
warranty made by Borrower in this Agreement.
(a) Formation: Authoritv. If Borrower is anything other than a natural
person, it has complied with all laws and regulations concerning its organization,
existence and the transaction of its business, and is in good standing in each state in
which it conducts its business. Borrower is the owner of the Property and is authorized
to execute, deliver and perform its obligations under the Loan Documents, and all other
documents and instruments delivered by Borrower to the City in connection therewith.
This Agreement and the Application have been duly executed and delivered by
Borrower and are valid and binding upon and enforceable against the Borrower in
accordance with their terms, and no consent or approval of any third party, which has
not been previously obtained by the Borrower, is required for the Borrower's execution
thereof or the perFormance of its obligations contained therein.
P6402-0201\1077697v6.doc Energy Program Loan Agreement-4
(b) Compliance with Law. Neither Borrower nor the Property is in
violation of, and the terms and provisions of the Loan Documents do not conflict with,
any regulation or ordinance, any order of any court or governmental entity, or any
building restrictions or governmental requirements affecting Borrower or the Property.
(�) No Violation. The terms and provisions of the Loan Documents,
the execution and delivery of the Loan Documents by Borrower, and the pertormance
by Borrower of its obligations contained therein, will not and do not conflict with or result
in a breach of or a default under any of the terms or provisions of any other agreement,
contract, covenant or security instrument by which the Borrower or the Property is
bound.
(d) Other Information. If Borrower is comprised of the trustees of a
trust, the foregoing representations shall also pertain to the trustor(s) of the trust. All
reports, documents, instruments, information and forms of evidence which have been
delivered to City concerning the Loan are accurate, correct and sufficiently complete to
give City true and accurate knowledge of their subject matter.
(e) Lawsuits. There are no lawsuits, tax claims, actions, proceedings,
investigations or other disputes pending or threatened against Borrower which may
impair Borrower's ability to perForm its obligations hereunder.
(fl Borrower Not a "Foreign Person". Borrower is not a "foreign
person" within the meanin g of S e c t i o n 1 4 4 5(fl(3) o f t h e In terna l Revenue Code of 1986,
as amended from time to time.
(g) No Event of Default. There is no event which is, or with notice or
tapse of time or both would be, a Default under this Agreement.
(h) Accurac of Declarations. The declarations of the Borrower
contained in the Application are accurate, complete and true.
6. Borrower's Covenants,
Borrower promises to keep each of the following covenants:
(a) C_ omaletion of Work and Maintenance of Equipment. Borrower
shall, or shall cause its contractor to, promptly commence construction of the Work, and
diligently continue such Work to completion, in a good and workmanlike manner and in
accordance with sound construction and installation practices. Borrower shall maintain
the Equipment in good condition and repair.
(b) Compliance with Law and Aqreements. In commencing and
completing the Work, Borrower shall comply with all existing and future laws,
regulations, orders, building restrictions and requirements of, and all agreements with
and commitments to, all governmental, judicial and legal authorities having jurisdiction
over the Property or the Work, and with all recorded instruments, agreements, and
covenants and restrictions affecting the Property.
P6402-0201\1077697v6.doc Energy Program Loan Agreement-5
(c) Permits Licenses and A rovals. Borrower shali properly obtain,
comply with and keep in effect all permits, licenses and a
be obtained from an pprovals which are required to
y governmental authority in order to commence and complete the
Work. Borrower, upon the request of the Director, shall promptly deliver copies of all
such permits, licenses and approvals to the Director.
(d) Site Visits. Borrower grants City, its agents and representatives the
right to enter and visit the Property at any reasonable time, after giving reasonable
notice to Borrower, for the purposes of observing the Work. City will make reasonable
efforts during any site visit to avoid interfering with Borrower's use of the Property.
Borrower shall also allow City to examine and copy records and other documents of
Borrower which relate to the Work. City is under no duty to visit the Property, or
observe any aspects of the Work, or examine any records, and City shall not incur any
obligation or liability by reason of not making any such visit or examination. Any site
visit, observation or examination by City shall be solely for the purposes of protecting
City's rights under the Loan Documents.
(e) Protection A ainst Lien Claims. Borrower shall promptly pay or
otherwise discharge any claims and liens for labor done and materials and services
furnished to the Property in connection with the Work. Borrower shall have the right to
contest in good faith any claim or lien, provided that it does so diligently and without
delay in completing the Work.
(fl Insurance. Borrower shall provide, maintain and keep in force at
all times until the Work is completed, builder's all risk property damage insurance on
the Property, with a policy limit equal to the full replacement cost of the Work.]
(g) Notices. Borrower shall promptly notify City in writing of any
Default under this Agreement, or any event which, with notice or lapse of time or both,
would constitute a Default hereunder.
7. Comaletion of the Work
Subject to Section 12(h), Borrower agrees to complete the Work on or
before , 20 .
8. Mechanic's Lien and Stoa Notices
In the event of the filing of a stop notice or the recording of a mechanic's
lien pursuant to applicable law of the State of California and relating to the Work,
Director may summarily refuse to make any disbursement of the Loan Amount, and in
the event Borrower fails to furnish Director a bond causing such notice or lien to be
released within ten (10) days of notice from Director to do so, such failure shall at the
option of City constitute a Default under the terms of this Agreement. Borrower shall
promptly deliver to Director copies of all such notices or liens.
P6402-020111077697v6.doc Energy Program Loan Agreement-6
9• Indemnification.
(a) Borrower shall indemnify, defend, protect, and hold harmless the
City and any and all agents, employees, attorneys and representatives of the City
(collectively, the "City Parties"), from and against all losses, liabilities, claims, damages
(including consequential damages), penalties, fines, forfeitures, costs and expenses
(including all reasonable out-of-pocket litigation costs and reasonable attorney's fees)
and any demands of any nature whatsoever related directly or indirectly to, or arising
out of or in connection with, (i) the Loan Documents, ii the disbursement of the Loan
Amount, (iii) the Work, (iv) the Equipment, (v) any br ach or Default by Borrower under
the Loan Documents, (vi) the Assessment and the Annual Administrative Assessment,
or (vii) any other fact, circumstance or event related to City's extension of the Loan to
Borrower or Borrower's perFormance of its obligations under the Loan Documents
(collectively, the "Liabilities"), regardless of whether such Liabilities shall accrue or are
discovered before or after the disbursement of the Loan Amount.
(b) The indemnity obligations described in this Section 9 shall survive
the disbursement of the Loan Amount, the repayment of the Loan, the transfer or sale
of the Property by the Borrower, and the termination of this Agreement.
10. Wavier of Claims.
For and in consideration of the City's execution and delivery of this
Agreement, Borrower, for itself and for its successors-in-interest to the Property and for
any one claiming by, through, or under the Borrower , hereby waives the right to recover
from and fully and irrevocably releases the City Parties from any and all claims,
obligations, liabilities, causes of action, or damages, including attorneys' fees and court
costs, that Borrower may now have or hereafter acquire against any of the City Parties
and accruing from or related to (i) the Loan Documents, ii the disbursement of the
Loan Amount, (iii) the performance of the Work, (iv) the Equipment, (v) any damage to
or diminution in value of the Property that may result from the Work, (vi) any personal
injury or death that may result from the Work, (vi) the selection of manufacturer(s),
dealer(s), supplier(s), contractor(s) and/or installer(s), and their action or inaction with
respect to the Work or the Equipment, (vii) the merchantability and fitness for any
particular purpose, use or application of the Equipment, (vii) the amount of energy
savings resulting from the Work and the Equipment, (ix) the workmanship of any third
parties, and (x) any other matter with respect to the Program. This release includes
claims, obligations, liabilities, causes of action, and damages of which Borrower is not
presently aware or which Borrower does not suspect to exist which, if known by
Borrower, would materially affect Borrower's release of the City Parties.
BORROWER HEREBY ACKNOWLEDGES THAT IT HAS READ AND IS
FAMILIAR WITH THE PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 1542
("SECTION 1542"), WHICH IS SET FORTH BELOW:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR
P6402-0201\1077697v6.doc Energy Program Loan Agreement-7
HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS
OR HER SETTLEMENT WITH THE DEBTOR."
BY INITIALING BELOW, BORROWER HEREBY WqIVES THE
PROVISIONS OF SECTION 1542 SOLELY IN CONNECTION WITH THE MATTERS
WHICH ARE THE SUBJECT OF THE FOREGOING WAIVERS AND RELEASES.
Borrower's Initials
The waivers and releases by Borrower contained in this Section 10 shall
survive the disbursement of the Loan Amount, the repayment of the Loan, the transfer
or sale of the Property by the Borrower, and the termination of this Agreement.
11. Further Assurances.
The Borrower shall execute any further documents or instruments
consistent with the terms of this Agreement, including documents and instruments in
recordable form, as City shall from time to time find necessary or appropriate to
effectuate its purposes in entering into this Agreement and making the Loan.
12. Events of Default.
(a) Subject to the further provisions of this Section 12, the failure of
any representation or warranty of the Borrower contained herein to be correct in all
material respects, or the failure or delay by Borrower to perform any of its obligations
under the terms or provisions of the Loan Documents, shall constitute a default
hereunder ("Default"). The Borrower must immediately commence to cure, correct, or
remedy such failure or delay and shall complete such cure, correction or remedy with
reasonable diligence, but in any event, within the time set forth in Sections 12(c) and (d)
below, as applicable.
(b) The City shall give written notice of default to Borrower, specifying
the default complained of by the City. Delay in giving such notice shall not constitute a
waiver of any default nor shall it change the time of default.
(c) If a monetary event of default occurs, prior to exercising any
remedies under the Loan Documents or the Act, City shall give Borrower written notice
of such default. Borrower shall have a period of thirty (30) days after such notice is
given within which to cure the default prior to exercise of remedies by City.
(d) If a non-monetary event of default occurs, prior to exercising any
remedies under the Loan Documents or the Act, City shall give Borrower notice of such
default. If the default is reasonably capable of being cured within thirty (30) days,
Borrower shall have such period to effect a cure prior to exercise of remedies by City
under the Loan Documents or the Act. If the default is such that it is reasonably
P6402-0201\1077697v6.doc Energy Program Loan Agreement-8
capable of being cured, but not within such thirty (30) day period, and Borrower
(i) initiates corrective action within such thirty (30) day period, and (ii) diligently,
continually, and in good faith works to effect a cure as soon as possible, then Borrower
shall have such additional time as is reasonably necessary to cure the default prior to
exercise of any remedies by City. However, in no event shall City be precluded from
exercising remedies if its security becomes or is about to become materially
jeopardized by any failure to cure a default, or if the default is not cured within one
hundred and twenty (120) days after the first notice of default is given.
(e) If any Default occurs, then, upon the election of City, (i) if there has
been no disbursement of the Loan Amount, this Agreement shall terminate and, except
as otherwise expressly provided herein, the parties have no further obligations or rights
hereunder, or (ii) if the Loan Amount has been disbursed in whole or in part, City may
terminate its obligations to make any further disbursement of the Loan Amount and
exercise any or all of the rights and remedies available to it under applicable law, at
equity or as otherwise provided herein.
(fl Any and all costs and expenses incurred by the City in pursuing its
remedies hereunder shall be additional indebtedness of the Borrower to the City
hereunder, and shall be secured as provided in the Act.
(g) Except as otherwise expressly stated in this Agreement, the rights
and remedies of the City are cumulative, and the exercise of one or more of such rights
or remedies shall not preclude the exercise by the City, at the same time or different
times, of any other rights or remedies for the same Default or any other Default. No
failure or delay by City in asserting any of its rights and remedies as to any Default shall
operate as a waiver of any Default or of any such rights or remedies, or deprive the City
of its rights to institute and maintain any actions or proceedings which it may deem
necessary to protect, assert or enforce any such rights or remedies.
(h) Performance of the covenants and conditions imposed upon
Borrower hereunder with respect to the commencement and completion of the Work
shall be excused while and to the extent that, Borrower is prevented from complying
therewith by war, riots, strikes, lockouts, action of the elements, accidents, or acts of
God beyond the reasonable control of the Borrower; provided, however, that such event
is not caused by the fault, negligence or misconduct of Borrower; and provided, further,
as soon as the cause or event preventing compliance is removed or ceases to exist the
obligations sha�l be restored to full force and effect and Borrower shall immediately
resume comptiance therewith and perFormance thereof.
13. Comnliance with Local State and Federal Laws
Borrower shall perForm the Work, or cause the Work to be performed, in
conformity with all applicable laws, including all applicable federal, state and local
occupation, safety and health laws, rules, regulations and standards. Borrower agrees
to indemnify, defend and hold the City Parties harmless from and against any cost,
expense, claim, charge or liability relating to or arising directly or indirectly from any
P6402-0201\1077697v6.doc Energy Program Loan Agreement-9
breach by or failure of Borrower or its contractor(s) or agents to comply with such laws,
rules or regulations. The indemnification obligations described in this Section 13 shall
survive the disbursement of the Loan Amount, the repayment of the Loan, and the
termination of this Agreement.
14. Severabilitv.
Each and every provision of this Agreement is, and shall be construed to
be, a separate and independent covenant and agreement. If any term or provision of
this Agreement or the application thereof shall to any extent be held to be invalid or
unenforceable, the remainder of this Agreement, or the application of such term or
provision to circumstances other than those to which it is invalid or unenforceable, shall
not be affected thereby, and each term and provision of this Agreement shall be valid
and shall be enforced to the extent permitted by law.
15. Notices.
All notices and demands shall be given in writing by certified mail, postage
prepaid, and return receipt requested, or by personal delivery (by recognized courier
service or otherwise). Notices shall be considered given upon the earlier of
(a) personal delivery or (b) two (2) business days following deposit in the United States
mail, postage prepaid, certified or registered, return receipt requested. Notices shall be
addressed as provided below for the respective party; provided that if any party gives
notice in writing of a change of name or address, notices to such party shall thereafter
be given as demanded in that notice:
To City: City of Palm Desert
73-510 Fred Waring Drive
Palm Desert, California 92260-2578
Attention: Director, Office of Energy Management
To Borrower:
Palm Desert, California 92260
Attention:
16. Attornevs' Fees and Costs.
[In the event that any action is instituted to enforce payment or
performance under this Agreement, the parties agree that the non-prevailing party shall
be responsible for and shall pay all costs and all attorneys' fees incurred by the
prevailing party in enforcing this Agreement.]
17. No Waiver.
No disbursement of the Loan Amount shall constitute a waiver of any
conditions to the City's obligation to make further disbursements nor, in the event
Borrower is unable to satisfy any such conditions, shall any such waiver have the effect
P6402-0201\1077697v6.doc Energy Program Loan Agreement- 10
of precluding the City from thereafter declaring such inability to constitute a Default
under this Agreement. No disbursement of the Loan Amount based upon inadequate
or incorrect information shall constitute a waiver of the right of City to receive a refund
thereof from Borrower.
18, Governinq Law.
This Agreement shall be governed by the laws of the State of California.
Any legal action brought under this Agreement must be instituted in the Superior Court
of the County of Riverside, State of California, or in an appropriate municipal court in
that County or in the United States District Court for the Central District of California.
19. Amendment of Aqreement
No modification, rescission, waiver, release or amendment of any
provision of this Agreement shall be made except by a written agreement executed by
the Borrower and City.
20. Citv Mav Assiqn; Role of the Citv
City, at its option, may (i) assign any or all of its rights and obligations
under the Loan and this Agreement, and (ii) pledge and assign its right to receive the
Assessment, the Annual Administrative Assessment, and the repayment of the Loan
and any other payments due to the City hereunder, without obtaining the consent of the
Borrower.
21. Borrower Assiqnment Prohibited
In no event shall Borrower assign or transfer any portion of this
Agreement or Borrower's rights or obligations under the Agreement without the prior
express written consent of City, which consent may be granted or withheld in the sole
and absolute discretion of the City.
22. Relationshia of Borrower and Citv
The relationship of Borrower and City pursuant to this Agreement is that of
debtor and creditor and shall not be or be construed to be a joint venture, equity
venture, partnership, or other relationship.
23. General.
Time is of the essence of this Agreement and of each and every provision
hereof. This Agreement, together with the other Loan Documents, constitutes the
entire agreement befinreen the parties hereto, and there shall be no other agreement
regarding the subject matter thereof unless signed in writing by the part to be charged.
If there is more than one "Borrower," the obligations hereunder of all Borrowers shall be
joint and several.
P6402-0201\1077697v6.doc Energy Program Loan Agreement- 11
24. Counterparts.
This Agreement may be executed in several counterparts, each of which
shall be deemed an original, and all of such counterparts together sha�l constitute one
and the same instrument.
25. Suecial Termination.
Nofinrithstanding anything to the contrary contained herein, this Agreement
shall terminate and be of no further force or effect If the Borrower has submitted to the
Director a notice of its decision to cancel this transaction on or prior to the date and
time described in the [Notice of Right to Terminate] which was delivered to the Borrower
upon its execution of this Agreement
26. No Third Partv Bene�ciary Riqhts
This Agreement is entered into for the sole benefit of Borrower and City
and, subject to the provisions of Section 20, no other parties are intended to be direct or
incidental beneficiaries of this Agreement and no third party shall have any right in,
under or to this Agreement.
P6402-0201\1077697v6.doc Energy Program Loan Agreement- 12
IN WITNESS WHEREOF, Borrower and City have entered into this
Agreement as of the date and year first above written.
Borrower: C��:
CITY OF PALM DESERT,
a California municipal corporation
Date of Execution by Borrower: By�
Name:
Title:
, 20
ATTEST:
P6402-0201\1077697v6.doc Energy Program Loan Agreement- 13
EXHIBIT "A"
[ATTACH COPY OF EXECUTED AND APPROVED APPLICATION]
P6402-0201\1077697v6.doc Energy Program Loan Agreement
Exhibit A
EXHIBIT "B"
DESCRIPTION OF THE PROPERTY
P6402-0201\1077697v6.doc Energy Program Loan Agreement
Exhibit B
EXHIBIT "C"
SCHEDULE OF ASSESSMENT INSTALLMENTS
Year Princiaal Interest Maximum Annual Total
Administrative Assessment
[To be provided]
P6402-0201\1077697v6.doc EnergyProgram Loan Agreement
Exhibit C
(Page 1)
APPENDIX D-2
LOAN AGREEMENT
CITY OF PALM DESERT ENERGY INDEPENDENCE PROGRAM
[MULTIPLE DISBURSEMENTS]
This Loan Agreement ("Agreement") is made and entered into as of this
day of , by and between the CITY OF PALM DESERT, a
California municipal corporation ("City") and
("Borrower").
REC_
A. City has established the Energy Independence Program (the "Program")
pursuant to which City may extend loans to property owners to finance the acquisition
and installation on their property of certain qualifying renewable energy systems and
energy efficient equipment. The purpose and method of administration of the loans
under the Program are described in the Energy Independence Program Report adopted
by the City Council on August 28, 2008, as it may be amended from time to time (the
"Report").
B. The Program is authorized by Chapter 29 of Part 3 of Division 7 of the
California Streets and Highways Code (the "Act").
C. The Borrower has submitted to the City that certain Palm Desert Energy
Independence Program Loan Application dated , 200 , a copy of which is
attached hereto as Exhibit "A" and incorporated herein by this reference (the
"Application"). The Application describes, among other things, the renewable energy
system and/or energy efficient equipment which is to be financed with the proceeds of
the loan described herein, and to be constructed on or installed in the property of
Borrower described in Exhibit "B" attached hereto and incorporated herein by this
reference (the "Property"), and the City has approved the Application as provided in the
Report.
D. The Borrower wishes to participate in the Program by executing this
Agreement with the City and using the proceeds of the loan made by the City to the
Borrower hereunder to finance the acquisition and [construction] [installation] on the
Property of the [renewable energy systemj [energy efficiency equipment] described in
the Application (the "Equipment"). The Equipment and its construction on or installation
in the Property is collectively referred to herein as the "Work".
NOW, THEREFORE, in consideration of the mutual covenants contained
herein and other valuable consideration, the receipt and adequacy of which is hereby
acknowledged, the parties agree as follows:
P6402-0201\1080467v3.doc Energy Program Loan Agreement
AGREEMENT
1. Loan Aareement.
(a) Subject to the conditions set forth herein, City agrees to extend a
loan ("Loan") to Borrower in the amount of up to
Dollars ($ ) (the "Loan Amount"). Nofinrithstanding anything to the
contrary contained herein, the Loan Amount shall not in any event exceed the actual
cost of the Work. The Loan Amount shall be adjusted, if necessary, prior to the first
disbursement of the Loan Amount to the Borrower and following the post-completion
inspection by the City's Office of Energy Management ("OEM") as described in
Section 3 below, and shall be adjusted by the Director of the OEM (the "Director") to an
amount equal to the actual cost of the Work. Any adjustment of the Loan Amount by
the Director shall be made on the basis of the best available written evidence of the
actual cost of the Work and in the exercise of the Director's reasonable judgment. The
Borrower shall be solely responsible for the payment of all cost of the Work which
exceeds the Loan Amount and Borrower agrees in any event to complete the Work and
to fund all costs associated with such completion which may be in excess of the Loan
Amount. This Agreement, together with the Application, the Report and the documents
and instruments attached to or referenced in this Agreement and the Application are
collectively referred to herein as the "Loan Documents."
(b) The term of the Loan and this Agreement shall be
(� years from the date that the proceeds of the Loan are first disbursed to the
Borrower.
(c) Interest shall accrue on the unpaid principal balance of the Loan
Amount from the date first disbursed to Borrower at the simple interest rate of seven
percent (7%) per annum. Interest shall be computed on the basis of a three hundred
sixty (360) day year. If a law which applies to the �oan and which sets maximum
interest rates or loan charges is interpreted by a court of competent jurisdiction in a
manner as would cause the interest or other loan charges collected or to be collected in
connection with the Loan to exceed the limits permitted by such laws, then: (i) any such
interest or loan charge shall be reduced by the amount necessary to reduce the interest
or charge to the permitted limit; and (ii) any sums already collected which exceed
permitted limits will be refunded by the City. The City may choose to make the refund
by reducing the outstanding principal amount of the Loan or by making a direct
payment to the Borrower.
(d) The Borrower promises to pay to the City, without deduction or
offset, the Loan Amount and the interest accrued thereon as provided herein. The
repayment of the Loan Amount and interest accrued thereon shall be repaid by the
Borrower to the City by the payment of an assessment levied against the Property
pursuant to Section 5898.30 of the California Streets and Highway Code (the
"Assessment"). In addition to the Assessment, the Borrower promises to pay to the
City, without deduction or offset, an annual assessment levied against the Property to
pay costs incurred by the City which result from the administration and collection of the
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Assessment or from the administration or registration of any associated bonds or
reserve or other related funds (the "Annual Administrative Assessment"). The Annual
Administrative Assessment shall not exceed Dollars ($_�
per year. The Assessment and the Annual Administrative Assessment, and the interest
and any penalties thereon shall constitute a lien on the Property until they are paid.
The installments of the Assessment and the Annual Administrative Assessment
(including principal and interest) shall be collected on the property tax bill pertaining to
the Property, and shall be subject to the same penalties, remedies, and lien priorities as
for property taxes in the event of non-payment. The Borrower hereby expressly
consents to the levy of the Assessment and the Annual Administrative Assessment and
the imposition of the lien on the Property as described herein and in the Act.
(e) The amount of assessment installments that will be placed on the
Property each year is set forth in Exhibit "C" attached hereto and incorporated herein by
this reference.
(fl The Assessment may be prepaid, in whole or in part, at any time
upon the payment of a premium in an amount equal to three percent (3%) of the
amount of the Assessment to be prepaid.
2. Use of Proceeds.
All proceeds of the Loan shall be used by Borrower for the sole purpose
of paying for the reasonable costs and expenses of the Work on the Property, and in
connection therewith the Borrower shall comply with all requirements set forth herein, in
the Application and in the Report.
3. Disbursement Procedures.
(a) Except as otherwise provided in Section 3(b), the City shall have no
obligation to make any disbursement of the Loan Amount hereunder unless and until
each of the following conditions is satisfied, or any such condition is expressly waived
by the Director:
(i) The receipt by the Director of a written certification from
Borrower, and the contractor(s), if any, that performed the Work, stating that the Work
for which disbursement is requested is complete, and the actual cost of such Work.
Such certification shall be in form and substance acceptable to the Director.
(ii) An inspection of the Work by the OEM, and a determination
by the Director that the Work has been completed in full compliance with the
requirements of the Loan Documents.
(iii) The receipt by the Director of such other documents and
instruments as the Director may require, including but not limited to, if applicable, the
sworn statements of contractor(s) and releases or waivers of lien, all in compliance with
the requirements of applicable law.
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(iv) Borrower has, as appropriate, executed and delivered to
Director the Loan Documents and such other documents or instruments pertaining to
the Loan or the Work as the Director may require.
(v) As of the date of disbursement of the Loan Amount, the
Director shall have determined that the representations of the Borrower contained in the
Loan Documents are true and correct, and no Default (as defined in Section 12 below)
shalt have occurred and be continuing.
(vi) No stop payment or mechanic's lien notice pertaining to the
Work has been served upon the City and remains in effect as of the date of
disbursement of the Loan Amount.
(vii) The City shall have received a title policy (the "Title Policy")
in the Loan Amount and insuring the Loan and the lien of the assessments described in
Section 1(d) hereof. The Title Policy shall be in form and substance acceptable to the
Director.
(b) Notwithstanding the provisions of Section 3(a), the City , upon
written request of the Borrower, may make one disbursement of the Loan Amount as a
progress payment prior to the completion of the Work if each of the following conditions
is satisfied, or any such condition is expressly waived by the Director:
(i) The Loan Amount must be Twenty Thousand Dollars
($20,000) or greater;
(ii) The amount of the requested disbursement does not exceed
fifty percent (50%) of the Loan Amount;
(iii) The Director shall have determined that at least seventy-five
percent (75%), on a cost basis, of the Equipment or construction materials necessary
for its installation on the Property and constituting a portion of the Work shall have been
delivered to the Property and shall have been reasonably secured from theft or
vandalism;
(iv) The proceeds of the requested disbursement shall not
exceed the actual cost of the Equipment or related construction materials described in
(iii) above; and
(v) The conditions to disbursement of the Loan Amount
contained in Sections 3(a)(iv), (v), (vi) and (vii) above shall have been satisfied or
waived by the Director.
(c) Borrower will, within (� days of presentation by the
Director, execute any and all documents or instruments required by the Loan
Documents in connection with the disbursement of the Loan Amount.
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4. Reaorts.
Borrower agrees, upon the request of Director, to promptly deliver to the
Director, or, if appropriate, cause its contractor(s) to promptly deliver to Director, a
written status report regarding the Work.
5. Representations and Warranties of Borrower.
Borrower promises that each representation and warranty set forth below
is true, accurate and complete as of the date of this Agreement, and the date of
disbursement of the Loan Amount. The disbursement of the Loan Amount shall be
deemed to be a reaffirmation by the Borrower of each and every representation and
warranty made by Borrower in this Agreement.
(a) Formation; Authoritv. If Borrower is anything other than a natural
person, it has complied with all laws and regulations concerning its organization,
existence and the transaction of its business, and is in good standing in each state in
which it conducts its business. Borrower is the owner of the Property and is authorized
to execute, deliver and perform its obligations under the Loan Documents, and all other
documents and instruments delivered by Borrower to the City in connection therewith.
This Agreement and the Application have been duly executed and delivered by
Borrower and are valid and binding upon and enforceable against the Borrower in
accordance with their terms, and no consent or approval of any third party, which has
not been previously obtained by the Borrower, is required for the Borrower's execution
thereof or the perFormance of its obligations contained therein.
(b) Compliance with Law. Neither Borrower nor the Property is in
violation of, and the terms and provisions of the Loan Documents do not conflict with,
any regulation or ordinance, any order of any court or governmental entity, or any
building restrictions or governmental requirements affecting Borrower or the Property.
(c) No Violation. The terms and provisions of the Loan Documents,
the execution and delivery of the Loan Documents by Borrower, and the perFormance
by Borrower of its obligations contained therein, will not and do not conflict with or result
in a breach of or a default under any of the terms or provisions of any other agreement,
contract, covenant or security instrument by which the Borrower or the Property is
bound.
(d) Other Information. If Borrower is comprised of the trustees of a
trust, the foregoing representations shall also pertain to the trustor(s) of the trust. All
reports, documents, instruments, information and forms of evidence which have been
delivered to City concerning the Loan are accurate, correct and sufficiently complete to
give City true and accurate knowledge of their subject matter.
(e) Lawsuits. There are no lawsuits, tax claims, actions, proceedings,
investigations or other disputes pending or threatened against Borrower which may
impair Borrower's ability to perform its obligations hereunder.
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(fl Borrower Not a "Foreign Person". Borrower is not a "foreign
person" within the meaning of Section 1445(fl(3) of the Internal Revenue Code of 1986,
as amended from time to time.
(g) No Event of Default. There is no event which is, or with notice or
lapse of time or both would be, a Default under this Agreement.
(h) Accuracy of Declarations. The declarations of the Borrower
contained in the Application are accurate, complete and true.
6. Borrower's Covenants.
Borrower promises to keep each of the following covenants:
(a) Completion of Work and Maintenance of Equipment. Borrower
shall, or shall cause its contractor to, promptly commence construction of the Work, and
diligently continue such Work to completion, in a good and workmanlike manner and in
accordance with sound construction and installation practices. Borrower shall maintain
the Equipment in good condition and repair.
(b) Compliance with Law and Aareements. In commencing and
completing the Work, Borrower shall comply with all existing and future laws,
regulations, orders, building restrictions and requirements of, and all agreements with
and commitments to, all governmental, judicial and legal authorities having jurisdictibn
over the Property or the Work, and with all recorded instruments, agreements, and
covenants and restrictions affecting the Property.
(c) Permits, Licenses and Approvals. Borrower shall properly obtain,
comply with and keep in effect all permits, licenses and approvals which are required to
be obtained from any governmental authority in order to commence and complete the
Work. Borrower, upon the request of the Director, shall promptly deliver copies of all
such permits, licenses and approvals to the Director.
(d) Site Visits. Borrower grants City, its agents and representatives the
right to enter and visit the Property at any reasonable time, after giving reasonable
notice to Borrower, for the purposes of observing the Work. City will make reasonable
efforts during any site visit to avoid interFering with Borrower's use of the Property.
Borrower shall also allow City to examine and copy records and other documents of
Borrower which relate to the Work. City is under no duty to visit the Property, or
observe any aspects of the Work, or examine any records, and City shall not incur any
obligation or liability by reason of not making any such visit or examination. Any site
visit, observation or examination by City shall be solely for the purposes of protecting
City's rights under the Loan Documents.
(e) Protection Against Lien Claims. Borrower shall promptly pay or
otherwise discharge any claims and liens for labor done and materials and services
furnished to the Property in connection with the Work. Borrower shall have the right to
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contest in good faith any claim or lien, provided that it does so diligently and without
delay in completing the Work.
(� Insurance. Borrower shall provide, maintain and keep in force at
all times until the Work is completed, builder's all risk property damage insurance on
the Property, with a policy limit equal to the full replacement cost of the Work.]
(g) Notices. Borrower shall promptly notify City in writing of any
Default under this Agreement, or any event which, with notice or lapse of time or both,
would constitute a Default hereunder.
7. Completion of the Work
Subject to Section 12(h), Borrower agrees to complete the Work on or
before , 20 .
8. Mechanic's Lien and Stoa Notices
In the event of the filing of a stop notice or the recording of a mechanic's
lien pursuant to applicable law of the State of California and relating to the Work,
Director may summarily refuse to make any disbursement of the Loan Amount, and in
the event Borrower fails to furnish Director a bond causing such notice or lien to be
released within ten (10) days of notice from Director to do so, such failure shall at the
option of City constitute a Default under the terms of this Agreement. Borrower shall
promptly deliver to Director copies of all such notices or liens.
9. Indemni�cation.
(a) Borrower shall indemnify, defend, protect, and hold harmless the
City and any and all agents, employees, attorneys and representatives of the City
(collectively, the "City Parties"), from and against all losses, liabilities, claims, damages
(including consequential damages), penalties, fines, forfeitures, costs and expenses
(including all reasonable out-of-pocket litigation costs and reasonable attorney's fees)
and any demands of any nature whatsoever related directly or indirectly to, or arising
out of or in connection with, (i) the Loan Documents, (ii) the disbursement of the Loan
Amount, (iii) the Work, (iv) the Equipment, (v) any breach or Default by Borrower under
the Loan Documents, (vi) the Assessment and the Annual Administrative Assessment,
or (vii) any other fact, circumstance or event related to City's extension of the Loan to
Borrower or Borrower's performance of its obligations under the Loan Documents
(collectively, the "Liabilities"), regardless of whether such Liabilities shall accrue or are
discovered before or after the disbursement of the Loan Amount.
(b) The indemnity obligations described in this Section 9 shall survive
the disbursement of the Loan Amount, the repayment of the Loan, the transfer or sale
of the Property by the Borrower, and the termination of this Agreement.
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10. Wavier of Claims.
For and in consideration of the City's execution and delivery of this
Agreement, Borrower, for itself and for its successors-in-interest to the Property and for
any one claiming by, through, or under the Borrower , hereby waives the right to recover
from and fully and irrevocably releases the City Parties from any and all claims,
obligations, liabilities, causes of action, or damages, including attorneys' fees and court
costs, that Borrower may now have or hereafter acquire against any of the City Parties
and accruing from or related to (i) the Loan Documents, (ii) the disbursement of the
Loan Amount, (iii) the pertormance of the Work, (iv) the Equipment, (v) any damage to
or diminution in value of the Property that may result from the Work, (vi) any personal
injury or death that may result from the Work, (vi) the selection of manufacturer(s),
dealer(s), supplier(s), contractor(s) and/or installer(s), and their action or inaction with
respect to the Work or the Equipment, (vii) the merchantability and fitness for any
particular purpose, use or application of the Equipment, (vii) the amount of energy
savings resulting from the Work and the Equipment, (ix) the workmanship of any third
parties, and (x) any other matter with respect to the Program. This release includes
claims, obligations, liabilities, causes of action, and damages of which Borrower is not
presently aware or which Borrower does not suspect to exist which, if known by
Borrower, would materially affect Borrower's release of the City Parties.
BORROWER HEREBY ACKNOWLEDGES THAT IT HAS READ AND IS
FAMILIAR WITH THE PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 1542
("SECTION 1542"), WHICH IS SET FORTH BELOW:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR
HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS
OR HER SETTLEMENT WITH THE DEBTOR."
BY INITIALING BELOW, BORROWER HEREBY WAIVES THE
PROVISIONS OF SECTION 1542 SOLELY IN CONNECTION WITH THE MATTERS
WHICH ARE THE SUBJECT OF THE FOREGOING WAIVERS AND RELEASES.
Borrower's Initials
The waivers and releases by Borrower contained in this Section 10 shall
survive the disbursement of the Loan Amount, the repayment of the Loan, the transfer
or sale of the Property by the Borrower, and the termination of this Agreement.
11. Further Assurances.
The Borrower shall execute any further documents or instruments
consistent with the terms of this Agreement, including documents and instruments in
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recordable form, as City shall from time to time find necessary or appropriate to
effectuate its purposes in entering into this Agreement and making the Loan.
12. Events of Default.
(a) Subject to the further provisions of this Section 12, the failure of
any representation or warranty of the Borrower contained herein to be correct in all
material respects, or the failure or delay by Borrower to perform any of its obligations
under the terms or provisions of the Loan Documents, shall constitute a default
hereunder ("Default"). The Borrower must immediately commence to cure, correct, or
remedy such failure or delay and shall complete such cure, correction or remedy with
reasonable diligence, but in any event, within the time set forth in Sections 12(c) and (d)
below, as applicable.
(b) The City shall give written notice of default to Borrower, specifying
the default complained of by the City. Delay in giving such notice shall not constitute a
waiver of any default nor shall it change the time of default.
(c) If a monetary event of default occurs, prior to exercising any
remedies under the Loan Documents or the Act, City shall give Borrower written notice
of such default. Borrower shall have a period of thirty (30) days after such notice is
given within which to cure the default prior to exercise of remedies by City.
(d) If a non-monetary event of default occurs, prior to exercising any
remedies under the Loan Documents or the Act, City shall give Borrower notice of such
default. If the default is reasonably capable of being cured within thirty (30) days,
Borrower shall have such period to effect a cure prior to exercise of remedies by City
under the Loan Documents or the Act. If the default is such that it is reasonably
capable of being cured, but not within such thirty (30) day period, and Borrower
(i) initiates corrective action within such thirty (30) day period, and (ii) diligently,
continually, and in good faith works to effect a cure as soon as possible, then Borrower
shall have such additional time as is reasonably necessary to cure the default prior to
exercise of any remedies by City. However, in no event shall City be precluded from
exercising remedies if its security becomes or is about to become materially
jeopardized by any failure to cure a default, or if the default is not cured within one
hundred and twenty (120) days after the first notice of default is given.
(e) If any Default occurs, then, upon the election of City, (i) if there has
been no disbursement of the Loan Amount, this Agreement shall terminate and, except
as otherwise expressly provided herein, the parties have no further obligations or rights
hereunder, or (ii) if the Loan Amount has been disbursed in whole or in part, City may
terminate its obligations to make any further disbursement of the Loan Amount and
exercise any or all of the rights and remedies available to it under applicable law, at
equity or as otherwise provided herein.
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(� Any and all costs and expenses incurred by the City in pursuing its
remedies hereunder shall be additional indebtedness of the Borrower to the City
hereunder, and shall be secured as provided in the Act.
(g) Except as otherwise expressly stated in this Agreement, the rights
and remedies of the City are cumulative, and the exercise of one or more of such rights
or remedies shall not preclude the exercise by the City, at the same time or different
times, of any other rights or remedies for the same Default or any other Default. No
failure or delay by City in asserting any of its rights and remedies as to any Default shall
operate as a waiver of any Default or of any such rights or remedies, or deprive the City
of its rights to institute and maintain any actions or proceedings which it may deem
necessary to protect, assert or enforce any such rights or remedies.
(h) PerFormance of the covenants and conditions imposed upon
Borrower hereunder with respect to the commencement and completion of the Work
shall be excused while and to the extent that, Borrower is prevented from complying
therewith by war, riots, strikes, lockouts, action of the elements, accidents, or acts of
God beyond the reasonable control of the Borrower; provided, however, that such event
is not caused by the fault, negligence or misconduct of Borrower; and provided, further,
as soon as the cause or event preventing compliance is removed or ceases to exist the
obligations shall be restored to full force and effect and Borrower shall immediately
resume compliance therewith and performance thereof.
13. Comqliance with Local State and Federal Laws
Borrower shall perForm the Work, or cause the Work to be performed, in
conformity with all applicable laws, including all applicable federal, state and local
occupation, safety and health laws, rules, regulations and standards. Borrower agrees
to indemnify, defend and hold the City Parties harmless from and against any cost,
expense, claim, charge or liability relating to or arising directly or indirectly from any
breach by or failure of Borrower or its contractor(s) or agents to comply with such laws,
rules or regulations. The indemnification obligations described in this Section 13 shall
survive the disbursement of the Loan Amount, the repayment of the Loan, and the
termination of this Agreement.
14. Severabilitv.
Each and every provision of this Agreement is, and shall be construed to
be, a separate and independent covenant and agreement. If any term or provision of
this Agreement or the application thereof shall to any extent be held to be invalid or
unenforceable, the remainder of this Agreement, or the application of such term or
provision to circumstances other than those to which it is invalid or unenforceable, shall
not be affected thereby, and each term and provision of this Agreement shall be valid
and shall be enforced to the extent permitted by law.
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15. Notices,
All notices and demands shall be given in writing by certified mail, postage
prepaid, and return receipt requested, or by personal delivery (by recognized courier
service or otherwise). Notices shall be considered given upon the earlier of
(a) personal delivery or (b) two (2) business days following deposit in the United States
mail, postage prepaid, certified or registered, return receipt requested. Notices shall be
addressed as provided below for the respective party; provided that if any party gives
notice in writing of a change of name or address, notices to such party shall thereafter
be given as demanded in that notice:
To City: City of Palm Desert
73-510 Fred Waring Drive
Palm Desert, California 92260-2578
Attention: Director, Office of Energy Management
To Borrower:
Palm Desert, California 92260
Attention:
16. Attornevs' Fees and Costs
[In the event that any action is instituted to enforce payment or
performance under this Agreement, the parties agree that the non-prevailing party shall
be responsible for and shall pay all costs and all attorneys' fees incurred by the
prevailing party in enforcing this Agreement.]
17. No Waiver.
No disbursement of the Loan Amount shall constitute a waiver of any
conditions to the City's obligation to make further disbursements nor, in the event
Borrower is unable to satisfy any such conditions, shall any such waiver have the effect
of precluding the City from thereafter declaring such inability to constitute a Default
under this Agreement. No disbursement of the Loan Amount based upon inadequate
or incorrect information shall constitute a waiver of the right of City to receive a refund
thereof from Borrower.
18. Governinq Law.
This Agreement shall be governed by the laws of the State of California.
Any legal action brought under this Agreement must be instituted in the Superior Court
of the County of Riverside, State of California, or in an appropriate municipal court in
that County or in the United States District Court for the Central District of California.
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19. Amendment of Aqreement.
No modification, rescission, waiver, release or amendment of any
provision of this Agreement shall be made except by a written agreement executed by
the Borrower and City.
20. Citv Mav Assiqn; Role of the Citv
City, at its option, may (i) assign any or all of its rights and obligations
under the Loan and this Agreement, and (ii) pledge and assign its right to receive the
Assessment, the Annual Administrative Assessment, and the repayment of the Loan
and any other payments due to the City hereunder, without obtaining the consent of the
Borrower.
21. Borrower Assianment Prohibited
In no event shall Borrower assign or transfer any portion of this
Agreement or Borrower's rights or obligations under the Agreement without the prior
express written consent of City, which consent may be granted or withheld in the sole
and a�sotute discretion of the City.
22. Relationshia of Borrower and Citv
The relationship of Borrower and City pursuant to this Agreement is that of
debtor and creditor and shall not be or be construed to be a joint venture, equity
venture, partnership, or other relationship.
23. General.
Time is of the essence of this Agreement and of each and every provision
hereof. This Agreement, together with the other Loan Documents, constitutes the
entire agreement befinreen the parties hereto, and there shall be no other agreement
regarding the subject matter thereof unless signed in writing by the part to be charged.
If there is more than one "Borrower," the obligations hereunder of all Borrowers shall be
joint and several.
24. Counterqarts.
This Agreement may be executed in several counterparts, each of which
shall be deemed an original, and all of such counterparts together shall constitute one
and the same instrument.
25. Saecial Termination.
Notwithstanding anything to the contrary contained herein, this Agreement
shall terminate and be of no further force or effect If the Borrower has submitted to the
Director a notice of its decision to cancel this transaction on or prior to the date and
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time described in the [Notice of Right to Terminate] which was delivered to the Borrower
upon its execution of this Agreement
26. No Third Partv Beneficiary Riqhts
This Agreement is entered into for the sole benefit of Borrower and City
and, subject to the provisions of Section 20, no other parties are intended to be direct or
incidental beneficiaries of this Agreement and no third party shall have any right in,
under or to this Agreement.
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IN WITNESS WHEREOF, Borrower and City have entered into this
Agreement as of the date and year first above written.
Borrower: Ci�;
CITY OF PALM DESERT,
a California municipal corporation
Date of Execution by Borrower: By�
Name:
Title:
, 20
ATTEST:
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EXHIBIT "A"
[ATTACH COPY OF EXECUTED AND APPROVED APPLICATION]
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Exhibit A
EXHIBIT "B"
DESCRIPTION OF THE PROPERTY
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Exhibit B
EXHIBIT "C"
SCHEDULE OF ASSESSMENT INSTALLMENTS
Year Princiaal Interest Maximum Annual Total
Administrative Assessment
[To be provided)
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Exhibit C
(Page 1)
APPENDIX E:
SUMMARY OF LOAN PROCESS
Proiect Scoainq
The first step in the loan process is project scoping. Property owners can work directly
with contractors to determine the scope of a project. Property owners can also schedule a
meeting with OEM staff to discuss proposed Energy Improvements and to get no-cost
and objective assistance with planning for those Energy Improvements.
Property owners can also request an optional, no-cost, on-site energy survey to be
completed by OEM professionals. The energy survey is intended to assist property
owners in determining their most effective means for EIP participation. A no-cost solar
site check is also available to help a property owner weigh his or her solar options.
As the project is defined, the property owner obtains a contractor's bid or determines the
cost of the equipment if self-installing.
Proqram Aaplication
The property owner calls, e-mails, or visits the Office of Energy Management to request
an EIP application form(the"Application"). The OEM staff will provide an Application
by hard copy, e-mail, facsimile, or web link as requested by the property owner.
Applications and instructions are available online at the Palm Desert web site.
The property owner submits the Application together with its required attachments to the
OEM. The OEM determines whether each Application is complete within 15 business
days of receipt of the Application. The OEM will notify the property owner if the
Application is complete, incomplete or denied by U.S. Mail, and additionally by phone,
facsimile, or e-mail if requested by the property owner.
Applications will be processed on first-come, first-served basis until funds are no longer
available.
Title Check
The OEM will verify that the applicant is the property owner through a City of Palm
Desert contract with a nationally-recognized title company. This contract will provide for
expedited title checks for EIP participants. The title company will provide a copy of the
vesting deed for the property prior to the OEM's approval of the Application, and the
OEM will also obtain a title insurance policy for the amount of the loan.
Page 1
Auplication Review
During the Application Review process the OEM verifies that:
(i) The application is complete and accurate;
(ii) The property owner(s) owns the subject property;
(iii) The subject property is developed and located in the City of Palm
Desert;
(iv) The subject property is not exempt from ad valorem property taxes;
(v) The property owner(s) is/are current in the payment of ad valorem
property taxes for the subject property;
(vi) The property owner(s)has/have declared that the property owner(s)
and the subject property is/are not currently involved in a bankruptcy
proceeding;
(vii) The proposed Energy Improvements and costs are eligible to be
financed under the Program. If the proposed Energy Improvements
are part of a project that includes new construction(e.g., a room
addition),the costs of the work have been properly allocated between
retrofitting and new construction;
(viii) The cost estimate(s) is/are reasonable;
(ix) The proposed contractor(s) is/are licensed by the State of California
and is/are in good standing with the Contractors State Licensing
Board;
(x) The requested loan amount(including contingency) is equal to or
greater than$5,000 and is less than or equal to $60,000; or the
requested loan amount(including contingency) is greater than $60,000
and less than or equal to $200,000 and the City Manager has approved
the application; or the requested loan amount is greater than $200,000
(including contingency) and has been approved by City Council; and
(xi) EIP funding is available.
Within 15 business days of receipt of an application, the OEM notifies the property
owner if the application is incomplete, approved or denied.
a. Incomplete. An application shall be deemed incomplete if it is missing any
information or attachments the property owner is required to provide.
Incomplete applications may be resubmitted. The OEM will process
resubmitted applications on a first-come, first-served basis based upon the
new receipt date.
b. A�proved. An application shall be deemed approved if the OEM has
verified all of the items in step (i)through (xi).
c. Denied. An application shall be deemed denied if the OEM cannot verify
any of the items in steps (i)through(xi). A property owner may request a
written statement of specific reasons for the denial within 60 business days
Page 2
of the date of notification of denial. In such case, the OEM will provide
such a statement to the property owner within 15 business days of receipt
of a request for a statement. Denied applications may be resubmitted. The
OEM will process resubmitted applications on a first-come, first-served
basis based upon the new receipt date.
i. If an application is denied on the sole basis that EIP funding is not
available,the application does not need to be resubmitted;
applicants will be placed on a waiting list based on the date of
application receipt.
ii. If an application is denied because the cost estimate(s) is/are not
deemed reasonable by the Director, a resubmitted application must
be accompanied by additional documentation of cost estimates as
determined in the Director's discretion, including, but not limited
to, cost estimates provided by one or more additional contractors.
The property owner will not be required to select the low bid;
however, the Director may limit the ma�cimum loan amount to an
amount deemed reasonable by the Director.
d. With respect to an application to finance a renewable energy system(s)
other than solar(such as wind or geothermal) or a custom energy
efficiency measure(s) (such as a combined heat and power system
cogeneration system), or to finance an emerging technology, the OEM
reserves the right to require the appropriate energy studies showing the
energy savings and/or energy generation capabilities of the proposed
project.
Loan Contract and Reservation
Within 10 business days of notification that an Application has been approved, the
Director, on behalf of the City, will enter into a contractual assessment agreement(the
"Loan Contract")with the property owner. This will assure the property owner that the
EIP Loan has been approved and that funds are reserved for the property owner's
approved project. Failure of the property owner to execute a Loan Contract within such
10-day period will require the Application to be resubmitted. The OEM will process
resubmitted applications on a first-come, first-served basis based upon the new receipt
date.
Upon execution of a Loan Contract, the City records an assessment lien against the
subject property in the City offices and the County Recorder's office.
A 10% contingency will be included in the Loan Contract to reserve additional funds for
the property owner to draw against if needed in the case of change orders. A copy of the
draft Loan Contract is included as Appendix D of this Report.
Page 3
Installation of Imarovements
Property owner enters into a contractual arrangement directly with a contractor for
Energy Improvements unless the property owner is self-installing the Improvements. All
work is subject to the City's Building Department permitting and inspections and all
other applicable federal state and local laws and regulations. All work must be completed
within 180 days of execution of the Loan Contract.
Proqress Pavments
If the maximum loan amount is $20,000 or greater, the property owner may request in
writing that the OEM make a progress payment prior to the completion of the work. The
OEM shall make the progress payment within 10 business days of receipt of the request
provided all of the following conditions have been met:
• At least 75 percent of the required materials have been delivered to the property
and have been reasonably secured. The OEM has the discretion to make its own
determination with respect to whether this condition has been satisfied; and
� The requested progress payment does not exceed 50 percent of the m�imum loan
amount.
Final Inspections
The Property owner notifies the OEM that all work has been completed. The OEM
reserves the right to inspect completed work within five business days of receipt of
notification that work is completed.
Based on satisfactory project completion, the OEM disburses loan funds to the property
owner within 10 business days of the completion of the inspection. The total amount of
funds to be disbursed shall not exceed the lesser of(i)the maximum loan amount
provided in the loan agreement(less the property owner's share of the title costs if not
paid in cash by the property owner) or(ii)the actual costs.
Propertv Tax Rolls
The City staff sends a database of assessment installments to the Riverside County
Assessor for collection of the assessment on the property tax roll.
Page 4
Contract No. C28140
��1N1 L LDA N extendrng
FIt18nG13��@fVIC85 I reach
JUIy 22, 2008
Mr. Patrick Conlon
Director of the Office of Energy Management
City of Palm Desert
73-710 Fred Waring Drive, Suite 200A
Palm Desert, California 92260
Re; Letter of Enqagemenf to Provide Assessment Levy Administrafion Services to fhe
City of Palm Desert
Dear Mr. Conlon:
We are pleased to provide this letter of engagement to assist the City of Palm Desert ("City") with the
submittal and ongoing administration of its Assessment levies. Whereas, the recently enacted law, AB 811,
now authorizes the legislative body of any City to designate an area within which its authorized officials,
and willing property owners, may enter into contractual assessments to finance public improvements
(including energy efficiency upgrades) to specified lots or parcels, Willdan Financial Services (formerly,
"MuniFinancial") offers to assist the City by supplementing its staff in performing the fundamental
requirements for the administration of these assessment loans. As we discussed, the estimated County
fees are approximately $0.50 per parcel. These fees are subject to annual change and collected by the
County directly prior to disbursing funds to the City. Therefore, as a part of these annual services, we
propose to perform the following tasks for the City of Palm Desert:
Scope of Services
A�se�sm�nt L��y Adrr�ini��r�ti�� aervic��
Willdan Financial Services will:
1. Based on information provided by the City, establish and maintain amortization schedules for each of
the parcels through the term of the lien/loan.
2. Provide assessment installment information for each parcel, formatted in the required configuration to
the County Auditor/Controller's Office for placement on the property tax roll.
3. Research and, if possible, resubmit installment amounts that are rejected by the County
Auditor/Controller's Office. Any assessment installment that cannot be collected on the County property
tax roll will be invoiced, on behalf of the City, directly to the property owner of record.
4. Provide a toll-free number to field inquiries from City staff, property owners, and other interested parties
regarding assessment proceedings and annual installments.
5. Provide, upon request, prepayment quotes of assessment liens and/or Notices of Assessment for all
interested parties. Fees for this service are paid by the requesting party and may be charged to a credit
card; there is no charqe to property owners and/or to the City. Willdan Financial Services will
obtain recordation information for prepaid assessments and coordinate the Release of Lien.
6. Monitor delinquent installment payments in January and May of each year; and provide reports
identifying all delinquent parce�s, along with the corresponding delinquent installment amounts to the
City.
Engineering � Geateohnic�l � Enviranmental � Finaracral � Nomeland Security
9bY.587.3500 � SQC7.755.886C � fax:8bi.587.3514 � 27389 Via lndustria,Suite 110,Temecula,CA 92590 � tvww,willdan.com
Contract no. C28140
CityofPalmDesert ,�/W�LLDAN I extending
Assessmenf Levy Services Frnanciai Services a�n
July22,2008
Page 2
Client Responsibilities
Willdan Financial Services will rely on the City for the following information:
• A listing of all parcels within the district, including the corresponding original lien/loan amount and
necessary repayment terms and conditions for each parcel.
• Appropriate resolutions/documentation required by the Riverside County Auditor-Controller's office to
enlist the assessments on the property tax roll.
• Assist Willdan Financial Services in obtaining information regarding collections, assessments, funds,
payments, and/or prepayments received by the City. Although Willdan Financial Services will annually
research this information, as required by the City of Palm Desert, the City's assistance may be
necessary.
• The annual administrative cost information to be incorporated into the annual levy each year.
• Parcel information for those properties that paid off during the year.
The City of Palm Desert acknowledges that Willdan Financial Services shall be relying upon the accuracy
of the information provided by the City or their designees and that Willdan Financial Services shall not be
liable for any inaccuracies contained therein.
Fees for Services
������m�nt L�vy dr�irti�tr��i�r� ��r�ri���
The number of parcels and districts shown below are the basis of this proposal. As the work progresses,
the fee is payable on a monfhly basis, unless another billing format is mutually agreed upon between the
City and Willdan Financial Services. In addition, all hourly rates, fees and expense rates are subject to
increase, not to exceed the Consumer Price Index within the applicable area.
� .- � • • - . �
• • �� �.
Assessment Levy Administra#ion 100 $40 $4,000
Payoff Quote (Per Request)* 50
Please Note: A $10.00 per parcel fee is added for each parcel levied beyond fhe inifia/ parcel
counf shown above.
* The requesting party(e.g., Tifle Companies)pays the fees for fhis service. There is no charpe to
property owners and/or fo the City.
Contract No. C28140
City of Palm Desert �/W I LLDAN I extending
Assessment Levy Services Financial Services ��n
July 22,2008
Page 3
ei���r��bl� �x�er����
Willdan Financia� Services will be reimbursed for out-of-pocket expenses. Examples of reimbursable
expenses include, but are not limited to: postage, travel expenses, mileage (58.5¢ per mile), maps,
electronic data furnished from the County and/or other applicable resources, construction cost periodicals,
and copying (currently 6� per copy). Any additional expense for reports or from outside services will be
billed to the City. Charges for meeting and consulting with counsel, the City, or other parties regarding
services not listed in the scope of work above will be at our then-current hourly rates (see the "Additional
Services"section).
In the event that a third party requests any documents, Willdan Financial Services may, in accordance with
Willdan Financiat Services' applicabie rate schedule, charge such third party for providing these
documents.
Additional Services
N��s�ly �tes
Additional services may be authorized by the City and will be billed at our then-current hourly consulting
rates. Our current hourly rates are:
.
Group Manager $ 180
Principa}Consultant 145
Senior Projec#Manager 125
Projec#Manager 105
Senior Project Analyst 95
Senior Analyst 85
Analyst 75
Analyst Assistant 65
Proper�r Owner Services Representative 50
Support Staff 45
Contract No. C28140
CiryoiPalmDesert �''W�LLDAN I extending
Assessment Levy Se►vices �inanciai seroices ��n
July 22,2008
Page 4
If acceptable, please sign below; and return this letter of engagement to Willdan Financial Services (a
stamped envelope has been provided for your convenience). We will interpret your signature as our
authorization to proceed.
Thank you for this opportunity to present our services for your consideration. If you have any questions,
please contact me at(800)755-6864; or via email at avazauez@wiltdan.com.
Sincerely,
Willdan Financial Services(formerly, "MuniFinancial")
,
,� `� ' V v
Adina Vazquez, Senior Pro'�ct an� er
District Administration Sery
OVERNITE EXPRESS
Accepted as Stated Herein:
Signature Title
Name(print) Date
Contract No. C28140
�/WILLDAN �tending
yoUr
Financial Services reach
"ATTACHMENT A" TO THE ENGAGEMENT LETTER
TERMS AND CONDITIONS
SECTION I—BASIC SERVICES
Willdan Financial Services shall provide to the Client the basic services described in detail in the
engagement letter attached hereto and incorporated herein by this reference. The engagement letter and
these Terms and Conditions shali be coilectively referred to as this"Agreement."
SECTION II—ADDITIONAL SERVICES
If authorized, Willdan Financial Services shall furnish additional services, which are in addition to
the basic services. To the extent that the additional services have been identified in this Agreement, they
are itemized in the attached engagement letter and will be paid for by Client as indicated in Section III
hereof. As further additional services are requested by Client, this Agreement may be modified and subject
to mutual consent by execution of an addendum by authorized representatives of both parties, setting forth
the additional scope of services to be performed, the performance time schedule and the compensation for
such services.
SECTION III—COMPENSATION
Willdan Financial Services shall be compensated for basic services rendered under Section I, as in
accordance with the terms and conditions indicated in the attached engagement letter; and Willdan
Financial Services will be compensated for any additional services rendered under Section II as more
particularly described in a fully approved and executed addendum to this Agreement. If no addendum is
executed, then Willdan Financial Services shall be compensated at its then-prevailing hourly rates for such
additional services.
Willdan Financial Services may submit monthly statements for basic and additional services
rendered. It is intended that Client will make payments to Willdan Financial Services within thirty (30) days
of invoice. All invoices not paid within thirty (30) days shall bear interest at the rate of one and one-half
percent(1�/z%) per month, or the then-legal rate allowed.
SECTION IV—TERMINATION
Either party may terminate this Agreement at any time by giving thirty (30) days' written notice to
the other party of such termination. If this Agreement is terminated as provided herein, Willdan Financial
Services will be paid an amount which bears the same ratio to the total compensation as the services
actually performed bears to the total services of Willdan Financial Services covered by this Agreement, less
payments of compensation previously made.
ATTACHMENT TO THE LETTER ENGAGEMENT/CITY OF PALM DESERT A-1
Contract No. C28140
�WILLDAN �tending
your
Financial Services �e�n
SECTION V—COMPLIANCE WITH LAW
Each party hereto will use reasonable care to compiy with applicable laws in effect at the time the
services are performed hereunder, which to the best of their knowledge, information and belief apply to
their respective obligations under this Agreement.
SECTION VI - MISCELLANEOUS PROVISIONS
This Agreement is subject to the following special provisions:
A. The titles used in this Agreement are for general reference only and are not a part of the
Agreement.
B. This Agreement shall be interpreted as though prepared by both parties.
C. Any provision of this Agreement held to violate any law shall be deemed void, and all
remaining provisions shall continue in full force and effect.
D. This Agreement shall be interpreted under the laws of the State of California.
E. This Agreement comprises a final and complete repository of the understandings between
the parties and supersedes all prior or contemporary communications, representations or agreements,
whether oral or written, relating to the subject matter of this Agreement.
F. Any notices given pursuant to this agreement shall be effective on the third business day
after posting by first class mail, postage prepaid, to the address appearing immediately after the signatures
below.
G. Willdan Financial Services shall not be liable for damages resulting from the actions or
inactions of governmental agencies including, but not limited to, permit processing, environmental impact
reports, dedications, general plans and amendments thereto, zoning matters, annexations or
consolidations, use or conditional use permits, project or plan approvals, and building permits.
H. Willdan Financial Services' waiver of any term, condition, or covenant, or breach of any
term, condition, or covenant, shalt not constitute the waiver of any subsequent breach of any other term,
condition or covenant.
I. Client acknowledges that Willdan Financial Services is not responsible for the performance
of services by third parties, provided that said Willdan Financial Services has not retained third parties.
ATTACHMENT TO THE LETTER ENGAGEMENT/CITY OF PALM DESERT q.p
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RESOLUTION NO. 08-75
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM
DESERT, CALIFORNIA, DECLARING ITS INTENTON TO FINANCE
DISTRIBUTED GENERATION RENEWABLE ENERGY SOURCES AND
ENERGY EFFICIENCY IMPROVEMENTS THROUGH THE U5E OF
CONTRACTUAL ASSESSMENT5 PURSUANT TO CHAPTER 29 OF
PART 3 OF DIVISION 7 OF THE CALIFOR1vIA STREET5 AND
HIGHWAYS CODE AND SETTING A PUBLIC HEARING THEREON
WHEREAS, pursuant to Chapter 29 of Part 3 of Division 7 of the California Streets and
Highways Code ("Chapter 29"), the City Council proposes to establish a contractual assessment
program to assist property owners with the cost of installing distributed generation renewable
energy sources or making energy efficient improvements that are permanently fixed to their
property;
NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF PALM DESERT
HEREBY FINDS,DETERMINES, RESOLVES,AND ORDERS AS FOLLOWS:
Section 1. The City Council hereby finds and declares all of the following:
A. Energy conservation efforts, including the promotion of energy efficiency
improvements to residential, commercial, industrial, or other real property, are necessary to
address the issue of global clirnate change.
B. The upfront cost of malcing residendal, commercial, industrial, or other real
property more energy efficient prevents many property owners from making those
improvements. To make those improvements more affordable and to promote the installation of
those improvements, the Legislature has authorized an alternative procedure pursuant to Chapter
29 for authorizing assessments to finance the cost of energy efficiency improvements.
C. A public purpose will be served by a contractual assessment program whereby the
City Council is authorized to finance the installation of distributed generation renewable energy
sources and energy efficiency improvements that are permanently fixed to residential
commercial, industrial, or other real property.
Section 2. The City Council hereby determines that it would be convenient,
advantageous and in the public interest to designate the entire City as an area within which
authorized City officials and property owners may enter inta contractual assessments pursuant to
Chapter 29 to finance the installation of distributed generation renewable energy sources or
energy efficiency improvements that are permanently fixed to real property.
Section 3. The City Gouncil hereby declares that it proposes to make contractual
assessment financing available to the owners of property in the City to finance the installation of
distributed generation renewable energy sources or energy efficiency improvements that are
permanently fixed to real property.
Section 4. The Director of the City's Office of Energy Management(the "Authorized
Officer") shall prepare, as part of the report required in Section 7 of this Resolution, and update,
1
RESOLUTION NO. 08-75
as the Authorized Officer deems necessary, a list of the distributed generation renewable energy
sources or energy efficiency improvements that may be financed through the City's contractual
assessment financing program. The types of distributed generation renewable energy sources or �
energy efficiency improvements eligible for financing through contractual assessments include,
but are not limited to, high efficiency air conditioning and ventilation systems, high performance �
windows, high efficiency pool equipment, high efficiency water hearing equipment, photovoltaic
and thermal solaz energy systems, zoning control and energy management control systems, high
efficiency irrigation pumps and controls, and natural gas fuel cells, wind and geothermal energy
systems, wall, ceiling and roof insulation upgrades.
Section 5. The area within which contractual assessments may be entered into
pursuant to Chapter 29 is the area within the City limits.
Sec�. The proposed arrangements for financing the contractual assessment
financing program are briefly described as follows: The City may issue bonds pursuant to
Chapter 29, the principal and interest of which would be repaid by contractual assessments.
Alternatively, the City may advance its own funds to finance work to be repaid through
contractual assessments, and may from time to time sell bonds, notes, certificates of participation
or other forms of indebtedness to reimburse itself for such advances. The proposed financing
arrangements may include the lease-purchase of public facilities by the City pursuant to a lease
or other contractual arrangement with a public financing authority or non profit entity or other
financing elements as may be determined necessary or useful to the financing of the contractual
assessment program.
In the event improvement bonds will be issued pursuant to Streets and Highways Code µ A
Section 5898.28 to represent assessments, all of the following will apply: , a.
(a) Division 10(commencing with Section 8500) of the Streets and Highways
Code ("Division 10") shall apply to any bonds issued pursuant to Section
5898.28, insofar as that division is not in conflict with Chapter 29.
(b) Provision is hereby made for the issuance of improvement bonds, in one
or more series;
(�) Notice is hereby given that serial bonds or term bonds or both to represent
unpaid assessments, and to bear interest at the rate of not to exceed 7%
percent per year, or such other amount authorized by law, payable
semiannually, shall be issued hereunder in one or more series in the
manner provided by the Division 10 (to the extent not in conflict with
Chapter 29), and the last installment of bonds shall mature a maximum of
15 years from the second day of September next succeeding 12 months
from their date.
(d) The City Council hereby determines and declares that the City wilI not
obligate itself to advance available funds from the City treasury to cure
any deficiency which may occur in the bond redemption fund. � �
2
RESOLUTION NO. 08-75
(e) The City Council hereby determines that the principal amount of bonds
maturing or becoming subject to mandatory prior redemption each year
shall be other than an amount equal to an even annual proportion of the
aggregate principal amount of the bonds, and the amount of principal
maturing or becoming subject to mandatory prior redemption in each year
plus the amount of interest payable in that year shall be an aggregate
amount that is substantially equal each year, except for the moneys falling
due on the first maturity or mandatory prior redemption date of the bonds
which shall be adjusted to reflect the amount of interest earned from the
date when the bonds bear interest to the date when the first interest is
payable on the bonds.
(fl With respect to the procedures for collection of assessments and the
advance retirement of bonds, the City Council proposes to proceed under
the provisions of Part 11.1 of Division 10 (commencing with Section 8670
of the Streets and Highways Code).
Section 7. The City Council hereby directs the Authorized Officer to prepare and file
with the City Council a report pursuant to Section 5898.22 of the California Streets and
Highways Code at or before the time of the public hearing described in Secrion 8 hereof(the
"Report"). T'he Report shall contain all of the following:
(a) A map showing the boundaries of the territory within which contractual
assessments are proposed to be offered.
(b) A draft contract specifying the terms and conditions that would be agreed
to be a property owner within the contractual assessment area and the
City.
(c) A statement of City policies concerning contractual assessments including
all of the following:
(i) Identification of types of facilities, distributed generation
renewable energy sources, or energy efficiency improvernents
that may be financed through the use of contractual
assessments;
(ii) Identification of a city official authorized to enter into
contractual assessments on behalf of the City,
(iii) A maximum aggregate dollar amount of contractual
assessments; and
(iv) A method for setting requests from property owners for
financing through contractual assessments in priority order in
the event that requests appear likely to exceed the authorization
amount.
3
RESOLUTION NO. 08-75
�d) A plan for raising a capital amount required to pay for work performed
pursuant to contractual assessments. The plan may include amounts to be .,..«
advanced by the City through funds available to it from any source. The
plan may include the sale of a bond or bonds or other financing
relationship pursuant to Streets and Highways Code Section 5898.28. The
plan shall include a statement of or method for determining the interest
rate and time period during which contracting property owners would pay
any assessment. The plan shall provide for any reserve fund or funds.
The plan shall provide for the apportionment of all or any portion of the
costs incidental to financing, administration, and collection of the
contractual assessment program among the consenting property owners
and the City.
Section 8. The City Council hereby calls a public hearing to be held on August 28,
2008, at 4:OOpm, or as soon thereafter as feasible, in the Council Chamber, 73-510 Fred Waring
Drive, Palm Desert, California, on the proposed Report and the contractual assessment financing
program. At the public hearing, all interested persons may appear and hear and be heard and
object to or inquire about the proposed contractual assessment financing program or any of its
particulars.
Section 9. The City Clerk is hereby directed to provide notice of the public hearing
by publishing this Resolution once a week for two weeks, pursuant to Section 6066 of the
California Government Code, in The Desert Sun and the first publication shall not occur later
than 20 days before the date of such hearing. � ,
See.tion 10. The assessments levied pursuant to Chapter 29, and the interest and any
penalties thereon, shall constitute a lien against the lots and parcels of land on which they are
made,until they are paid. The assessments shall be collected in the same manner and at the same
time as the general taxes of the City on real property are payable and shall be subject to the same
penalties,remedies and lien priorities in the event of delinquency and default.
Section 11. The City Council hereby directs the Authorized Officer to enter into
consultations with the County of Riverside Auditor-ControIler's office in order to reach
agreement with the County regarding the collection of the contractual assessments by the County
on the tax roll.
4
RESOLUTION NO. 08-75
Section 12. This Resolution shall not become effective unless and until Assembly Bill
811, introduced during the 2007-08 Regular Session of the California Legislature,becomes law.
PASSED, APPROVED, AND ADOPTED by the Palm Desert City Council at its regular
meeting held this 24th day of Ju�%,20 08 ,by the following vote, to wit:
AYES: FERGUSON, FINERTY, KELLY, and 5PIEGEL
NOES: NONE
ABSENT: BENSON
ABSTAIN: NONE
/ � _
ROBERT�: SPIEGEL, AYO P O-TEMPORE
ATTEST:
RA HELLE D. KLASS , CITY CLE
CITY OF PALM DESERT, CALIFORNIA
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