HERO Program – Financing Energy Efficient upgrades with Theresa Garza of Renovate America

A Everyday Green Home Podcast – Recorded Live at the St. Louis Home & Garden Show

(photo credit: Mike and 2 Guys)

Theresa Garza is the Market Development Manager for Renovate America. They are in a private public partnership with the Missouri Clean Energy District, which is a clinical subdivision of the state of Missouri that authorizes PACE (Property Assessed Clean Energy) energy efficient upgrades financing throughout the entire state.

The legislation for PACE was passed in 2011. It created the clinical subdivision, but the financing didn’t start until 2015.

Energy efficient projects don’t just have to be about saving money.

There are so many other benefits. We as individuals have an opportunity to impact climate change, what is happening in all the world around us by what we do in our homes. Using less energy, not wasting energy, using new components when we repair, upgrade, maintain, replace is a way for us to do our part. So not only is this going to be great for you and your home, but you’re doing a part that’s part of something bigger.

Renovate America prides itself on not only providing people with the ability to do these energy efficienct upgrades, but also allowing them to do that through a financing mechanism. They have also seen that it creates jobs and cuts down green emissions across the board. PACE came about because they need someone to finance the energy efficient products.

Often, those products are a little bit more expensive. PACE allows for them to finance it, to do those energy efficient upgrades so they see the long-term benefit monthly through the decrease in their utility bills. This covers everything from HVAC to solar panels, energy efficient water heaters, insulation, insulated siding, some roofing. It’s an extensive list of products that are authorized under PACE statute to be utilized for PACE financing.

Home Energy Renovation Opportunity – HERO

This brand of PACE financing with the Missouri Clean Energy District is called HERO – Home Energy Renovation Opportunity. It allows people to do these energy efficient upgrades by paying it back via their property taxes. So, when you contact a contractor, they come into the home, they evaluate and assess what needs to be done, they give you the project price, and then they communicate to the home owner their options to finance the project. HERO is one of those that they can offer now in the state of Missouri.

Once the property owner agrees that this is how they want to finance it, then the contractor completes the project. The homeowner then signs a completion certificate for the Missouri Clean Energy District, so the contractor can be paid. That paperwork is then turned over to the tax collector of each county to place on the property tax bill. The homeowner will then see an additional line on their property tax bill for HERO financing.

The homeowner is no cash out of pocket when they’re approved for HERO. In the state of Missouri, to be approved for the program, it must be an economic benefit. Those are the words that are used in the state statute, meaning that the property owner must be able to see, over the course of the product, that they are saving money on a regular basis. This is tailor made for existing homes, not necessarily new construction.

There are some requirements to qualify for the HERO program in Missouri: 10% equity in your home and current on the mortgage payments and property taxes.

The HERO program is currently available in 3 states – Florida, California, and Missouri. There are 32 states that have PACE legislation, but don’t have active programs yet. Once the legislation is in place, then the program must be put together for the actual funding to become available. Once the funding is available, then the actual implementation of it begins.  The HERO program is currently working to add 3 states in 2017, then more each year. They are also looking to start working with commercial properties as well as residential. Commercial works a little differently, but they are still looking to expand into that space.

Educating the Community

In Missouri, the program started in September 2016. Since then, there have been about 1,000 applications from across the state.They are slowly in the process of approving some of those. About 200 projects have already been completed across the state. Because they work directly with the contractors, there is always a need to increase our contractor database, so the contractors can become certified HERO contractors. They must be licensed, bonded, and have their insurance. They also go through a background check. Once approved, the contractor completes the training program, then are added to the system as a certified contractor.

Renovate America is currently working on educating the community, property owners, municipalities and local governments, contractors, chamber of commerce’s, etc. They are working on getting more people educated and involved.

So far, the typical projects that have been done in Missouri are HVAC systems, windows, doors, and solar.

Financing Energy Efficient Upgrades with PACE

So, any homeowners that thinking of making an investment and an improvement in your home that’s going to impact or takes energy, see if you can qualify for PACE financing. This will be a much easier way to finance. There is a fixed interest rate across the term of the assessment ranging from 3.49% to 8.9% – depending on the registered contractor, the product type, and then the financing terms. The rates are reasonable in comparison to traditional banking and so forth.

PACE is not currently listed in DSIRE (the database of state incentives for renewables and energy efficient list). It’s a database that’s maintained nationally, but it’s by state to see all the incentives, rebates, tax credits that are available for green and energy efficient projects in a home. Anyone can go to that database to see what’s available anywhere in the United States.

If you are a homeowner looking to make some upgrades to your home, there are 2 ways this program works. One is that you call the contractor that is already certified and he will walk you through the finance process. Or, you can go to HERO program website and find a certified contractor in your state. Homeowners can also apply online and know before contacting the contractor so they know how much they qualify for. If you do not qualify, the homeowner will be notified why. One of the consumer protections is to make sure that somebody doesn’t go belly-up on their home improvement loan. The rate of being paid back for this program is 99% – because of the way it has been set up and established.

Many people will never live in a brand-new home, and never have an opportunity to buy a new home or build a new home. And there is a huge amount of existing homes that need to be upgraded dramatically. This program is a wonderful way to affordably provide those upgrades.

For any contractors that want to be involved in the project, go to the same website, heroprogram.com, and click on the link for ‘Contractors’. There you will apply to become certified HERO contractor.

So, if you are doing home improvements, if you are replacing heating and cooling systems and other big systems in your home, check out this program. This is a way to do more with less.


HERO Program  

DSIRE Database 

Facebook Live Video of recording podcast with Theresa 

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