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Finance green improvements through property taxes, utility bills

Wow, here’s one that slipped right by me last summer.

California Assembly member Lloyd Levine (D) sponsored successful legislation that allows cities and counties to offer low-interest loans to homeowners and businesses in order to install solar panels, dual-pane windows, energy-efficient air conditioners and other greenhouse-gas-reducing technologies.

Rather than pay the high up-front costs themselves, or pay credit card interest rates, property owners would repay the loan over many years through their property taxes or utility bills.

If they sell the home or building, the loan balance and payments would transfer to the new owners.

At this time only Berkeley and Palm Desert are taking advantage of the permission Levine’s bill offers, but it’s only a matter of time before other cities see the possibilities.

San Francisco actually originated the idea with project that is bond-financed, but it is a “charter city” with supreme control of its financial affairs and does not require the legal permissions of Levine’s bill.

In addition to being a source of long-term income, such a project would be a way for municipalities to reduce their emissions as required by the state’s 1996 Global Warming Solutions Act.

Large corporations such as SunEdison, MMA Renewable Ventures and Recurrent Energy have offered a form of up-front financing for business customers by installing equipment at no charge in exchange for power-purchase agreements.

The option was not available to individual homeowners, however, and it wasn’t especially low-cost.

Government agencies can take advantage of tax-exempt, low-interest financing by using bonds with a long payoff period.

This would allow the energy savings to exceed the loan payments, making it a very affordable option.

There may be other ecological and political advantages to this type of plan as well.

Subsidizing individual solar systems could reduce the need for controversial solar plants and wind farms in fragile desert areas.

Naysayers wonder if the addition to property taxes or utility bills would really go away once the loan was paid off – and it’s a legitimate concern.

But there is good reason to offer an array of ways to afford alternative technology. This is one useful possibility.

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