Rather than using a typical bank loan for the energy project construction, the property owner obtains funding from a specialized PACE Lender.
Local Government/Program Administrator must first approve the PACE Project. It is highly recommended that approval is obtained prior to start of energy project construction.
PACE Lender provides funding to the contractor and directs the local government to add a tax assessment to the property's regular tax bill. Assessments are usually paid in annual installments with a term of up to 20 years or more.
PACE repayment is collected with the property tax payment and requires no additional paperwork from the property owner. In fact, the PACE assessment stays with the property and automatically transfers to a new owner.
Local Government/Tax Collector remits the PACE portion of the taxes back to the PACE Lender.