PACE Financing for Naturally-Occuring Multifamily Housing

Abstract

This project was completed as part of the 2018-2019 Resilient Communities Project (rcp.umn.edu) partnership with Ramsey County. The Property Assessed Clean Energy (PACE) Program is a loan program that provides financing for energy efficiency upgrades and renewable energy retrofits for commercial, industrial, and multifamily residential properties. PACE helps property owners overcome the challenge of gathering up-front capital for energy improvements, and makes it easier to transfer the cost of the improvements if the owner decides to sell the property. Nationally, PACE has been a successful tool for retrofitting residential properties. Thus far, PACE has not been used to finance any multifamily residential projects in Ramsey County. Ramsey County project lead Mary Lou Egan worked with a team of students in Dr. Ed Goetz's PA 5261: Housing Policy course to investigate potential barriers to the use of PACE for multifamily residential projects, as well as possible incentives or other mechanisms to encourage the use of PACE for such projects. Based on their findings, the student team concluded that the Commercial PACE program as currently structured in Minnesota is not an appropriate tool for use with multifamily residential projects. The students' final report is available.