New Program Provides Financing for Home Efficiency Upgrades in Kansas City
Will give contractors a new tool for their customers to finance energy-saving improvements
KANSAS CITY, Mo. — Renovate America, a provider of residential Property Assessed Clean Energy (PACE) financing in the U.S., and the Missouri Clean Energy District (MCED) announced a recruitment effort to register local contractors to offer new financing for Missouri homeowners to make energy efficiency and renewable energy improvements. The new Home Energy Renovation Opportunity (HERO) program will give local contractors a new tool for growing their businesses and reaching more customers with energy-saving technologies. The program enables clean energy upgrades to be paid for over time through local property taxes, at a fixed interest rate for terms of five to 20 years, based on the useful life of the product.
“Every year, one in six homeowners replaces a system that consumes energy. Three-quarters of the time they choose inefficient technology that ends up costing them more over the long term in higher energy bills,” said Joe Suggs, vice president for operations in Missouri for Renovate America. “HERO can solve that marketplace failure while helping homeowners save on energy bills, local contractors create clean energy jobs, and local governments reduce emissions.”
“I’m very excited about the HERO program because it will make energy efficiency and renewable energy upgrades more affordable for homeowners — improving our customers’ sense of comfort in their homes while reducing their energy bills over time. HERO can be a game changer for my business and my customers,” said Steve Burbridge, co-owner of Anthony Plumbing, Heating & Cooling.
As a partner with local government, PACE financing includes additional requirements to protect consumers not found in other payment options like credit cards or home equity loans. For example, the HERO program will only pay a contractor after the homeowner signs off that the job has been completed to their satisfaction. Contractors must be in good standing with HERO; products and labor must meet competitive pricing standards; and homeowners select from products certified as efficient by local, state, and federal government authorities.
HERO is expected to enable thousands more property owners in jurisdictions that adopt the program to finance improvements such as a more efficient HVAC system, building insulation, or solar panels. Since these improvements stay with the home, PACE financing is repaid through the property taxes, interest may be tax deductible, and any remaining balance may be able to be passed to a new owner. HERO financing does not require upfront payments, so it can be a good solution when a system fails and/or needs an upgrade for which a homeowner has not saved. Homeowners qualify based on equity in the property and a proven track record of on-time mortgage and property tax payments.
Contractors are able to create new jobs thanks to resources provided by HERO, such as an integrated software platform that helps connect contractors with homeowners and hundreds of thousands of eligible products, and makes financing seamless and straightforward. HERO also offers low-interest working capital and marketing resources to help small contractors expand their businesses.
HERO will be available within cities and counties that have joined the Missouri Clean Energy District. Local governments can join by passing a resolution. Contractors interested in offering HERO financing can register at https://register.renovateamerica.com. Once the program officially launches in Jackson County this summer, homeowners in the county can begin using HERO to finance clean-energy improvements.
In California, where PACE financing began, HERO has been used by more than 66,000 homeowners since 2012 to make more than $1.5 billion in efficiency improvements, creating more than 13,500 local jobs, and generating more than $2.7 billion in local economic activity.
For more information about Renovate America, visit www.renovateamerica.com.
For more information about the Missouri Clean Energy District, visit www.mced.mo.gov.
Publication date: 7/18/2016