Agenda 03/13/2012 Item # 5B3/13/2012 Item 5.B.
Status Report:
Property Assessed Clean Energy (PACE) Program
PACE programs were authorized by HB 7179, signed by Gov. Crist on May 27, 2010. PACE is a
financing mechanism similar to a special taxing district, providing voluntary loans for energy efficiency
retrofits of residential, industrial and commercial properties, which are secured by real property and
paid back through property taxes, like other municipal assessments. The Federal Housing and
Finance Agency (FHFA) halted most residential PACE programs in July 2010 over concerns with the
primacy of PACE liens over federally- backed Freddie Mac and Fannie May mortgages. Nevertheless,
twenty seven states, including Florida, now have valid PACE enabling laws. There are currently 4
PACE - related programs in Florida; all started in 2010, with the primary focus on the commercial market
until FHFA issues are resolved. PACE Litigation in NY, CA, and FL is moving through the federal courts
and federal legislation, the PACE Protection Act of 2011 (HR 2599), has been filed but has not yet been
acted on.
On June 8, 2010 (Agenda Item 9A) staff was directed by the Board to work with the Task Force to
explore PACE and report back to the Board on the feasibility of County participation and on September
28, 2010 (Agenda Item 5B), staff reported to the Board on the status of PACE programs and that
financing alternatives and grant funding opportunities were being explored. No grant funding has
currently been identified.
After meeting periodically and finding the situation regarding residential PACE unchanged, the Task
Force began looking at a commercial PACE program, with potential application to the residential sector
later.
On March 8, 2011, staff again addressed the Board (Agenda Item 9E) to provide a PACE update and
request approval to solicit information for a commercial PACE Program via a formal Request for
Information (RFI) process. The board approved advancing to RFI with stipulations that any program
considered would not require funding from the County or affect the County's bond status. The RFI
resulted in two proposals, from EcoCity Partners and Ygrene, which are attached as back -up. At the
time the RFI was issued, due to FHFA concerns about PACE and residential loans, staff asked for
information solely about a commercial PACE Program. However, since that time, efforts are moving
forward, nationwide, to include a residential component in PACE Programs, despite FHFA concerns.
Collier County is surrounded by PACE projects moving forward on the local level. These include:
The Miami -Dade County Green Corridor, led by the Town of Cutler Bay, awarded a contract
last September to the Ygrene Energy Fund Florida to build, fund and operate a PACE project in
the Dade County municipalities of Coral Gables, Palmetto Bay, Pinecrest, South Miami and the
City of Miami. Since then, the City of Miami Gardens and other northern Dade County
municipalities have expressed an interest in joining the effort. To date, the Miami -Dade County
Green Corridor has reached a set of milestones including the establishment of its Energy
Center; the employment of a full -time operations manager; engagement and certification of
builders and contractors; launching of its program to pre- approve eligible property owners;
engagement of bond validation and launch soon of its website, which will be a hub for use by
participants. The Ygrene group is one of the companies expressing an interest in operating a
PACE project in Collier and participated in the formal initiative last fall through the RFI process.
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3/13/2012 Item 5. B.
• The Town of Lantana is moving forward with a PACE project, in conjunction with EcoCities,
and is actively seeking other local governments to join through inter -local agreements. EcoCities
group is the other company that expressed an interest in operating a PACE project in Collier
and participated in the formal initiative last fall through the RFI process.
Lee County has issued a formal Request for Proposals (RFP) (copy attached) for a turn -key,
fully- funded program that would involve minimal county staff time. The deadline for submission
to that RFP is March 2, 2012. Lee County's intention is to begin with a PACE program for
commercial properties and expand to residential later, including properties that may have
mortgages greater than the currently- assessed value, depending on the response and advice of
the company selected to run the Lee County PACE project. As part of that process, Lee County
is utilizing a survey of property owners to try to determine the overall interest in a PACE project.
The Florida PACE Funding Agency was created last year by an agreement between the City
of Kissimmee and Flagler County. It has been designed to encourage local governments to
subscribe to its statewide, uniform program rather than pursue purely local efforts that would
likely not be able to achieve the economies of scale anticipated by the agency. The Florida
PACE Funding Agency provides a means to validate and provide certainty as to the nature of
the non -ad valorem assessments and the impact or reaction from mortgage lenders doing
business in Florida, as well as the ability to only issue bonds on an as- needed basis to
underwrite energy efficiency, renewable energy and wind resistance improvements. In short, the
Florida PACE Funding Agency is seeking the establishment of a single, state -wide PACE
project into which local governments could join.
Potential Options to move forward include:
• Continue to develop a stand -alone PACE Program, similar to Miami Dade and Lee Counties;
• Join, through inter -local agreement, any of the neighboring PACE Programs;
• Join the effort established by the Florida PACE Funding Agency, when it comes to fruition as
planned and envisioned;
• No action.
The Collier County Energy Task Force recommends building and deploying a survey of property
owners to solicit and gauge the interest of Collier County property owners and, should that survey
suggest an interest on the part of property owners, come back to you to seek further direction with an
eye toward moving forward with a PACE project in Collier County. The "no action" option, which would
drop efforts to create jobs and reduce energy use, is not recommended as being in the best interests of
Collier County.
2
Packet Page -17-
COLLIER COUNTY
Board of County Commissioners
Item Number: S.B.
3/13/2012 Item 5. B.
Item Summary: Recommendation to accept a status update on Property Assessed Clean
Energy (PACE) program and provide direction in furthering the County's efforts toward
implementing a PACE Program.
Meeting Date: 3/13/2012
Prepared By
Name: SuleckiAlexandra
Title: Environmental Specialist, Senior,Facilities Manage
3/1/2012 10:36:11 AM
Submitted by
Title: Administrator, Administrative Services
Name: PriceLen
3/1/2012 10:36:12 AM
Approved By
Name: pochopinpat
Title: Administrative Assistant,Facilities Management
Date: 3/1/2012 11:07:06 AM
Name: CampSkip
Title: Director - Facilities Management,Facilities Manage
Date: 3/1/2012 12:54:06 PM
Name: PriceLen
Title: Administrator, Administrative Services
Date: 3/1/2012 3:34:21 PM
Name: KlatzkowJeff
Title: County Attorney
Date: 3/2/2012 3:33:01 PM
Packet Page -18-
Name: KlatzkowJeff
Title: County Attorney
Date: 3/2/2012 3:43:49 PM
Name: FirmEd
Title: Senior Budget Analyst, OMB
Date: 3/3/2012 4:11:12 PM
Name: OchsLeo
Title: County Manager
Date: 3/4/2012 8:17:35 PM
Packet Page -19-
3/13/2012 Item 5.13.
3/13/2012 Item 5. B.
i
Response To Request For Information
No. 11 -5716
Property Assessed Clean Energy
(PACE) Project
June 23, 2011
max'' LEWIS, LONGMAN & WALKER, P.A.
224 Datura Street, Suite 211, West Palm Beach, Florida 33401
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3/13/2012 Item 5. B.
Company Information
Legal Name of Lead Firm: EcoCity Partners, L3C
Federal Employer Identification Number: 27- 2557508
State of Florida Applicable License Number: M10000003040
Point of Contact for all Communication Relating to this Submittal
Print Name: Michael Wallander Title: Manager
E -mail address: michaeL@ecocitypartners.com
Mailing Address: 224 Datura Street, Suite 211, West Palm Beach, FL 33401
Telephone: (818) 527 -6511 Fax: (855) 527 -6511
Authorized Representative (if different)
The following people shall be authorized to sign on behalf of the Company:
Print Name: Michael Wallander Title: Principal
Packet Page -21-
June 23, 2011
To Whom It May Concern:
3/13/2012 Item 5.B.
EcoCity Partners, L3C, Renewable Funding and Erin Deady of Lewis Longman Et Walker, P.A., are pleased
to submit information in response to the Request for Information No. 11 -5716 issued by Collier County
regarding Property Assessed Clean Energy (PACE) Financing.
We believe that Collier County is acting prudently by gathering information about PACE. Since PACE was
first conceived in 2008 and implemented in Berkeley, CA, much has transpired to alter the landscape for
municipal and County sponsored PACE programs.
As Collier County is no doubt aware, residential programs have Largely been put on hold given the position
taken by the Federal Housing Finance Agency (FHFA), as well as the Office of the Comptroller of the
Currency (OCC), Fannie Mae and Freddie Mac. Many of the jurisdictions in which PACE programs have been
initiated are currently engaged in Litigation with these federal agencies, including Leon County, Florida, who
is being represented in that case by Erin Deady and Lewis, Longman Et Walker.
Given the impact these federal agencies' positions have had on PACE financing, we have been working
diligently to develop bipartisan legislation that will address these regulatory concerns. We hope and expect
such Legislation to be introduced in the near future.
Unfortunately, without a favorable ruling in the Leon County case or a bipartisan legislative fix, PACE for
residential will likely remain on hold. For this reason, we will limit our response to the RFI to commercial-
only programs, which will significantly simplify the County's information gathering. If and when the policy
issues surrounding residential programs are resolved, we will gladly answer any additional questions that
Collier County may have about PACE residential. To date, there are only four operative commercial PACE
programs in the country. Information about these programs is provided in the enclosed Policy Brief Update
on Commercial PACE Programs dated March 23, 2011 that Renewable Funding prepared in partnership with
the Clinton Climate Initiative and Lawrence Berkeley National Laboratory.
Thank you for the opportunity to submit this information. We took forward to exploring ways in which our
team can assist Collier County with its job creation and energy financing goals.
Sincerely,
CA
Michael WaRander
EcoCity Partners, LK
E&: SIM
Cisco DeVries
Renewable Funding
Packet Page -22-
Erin Deady
Lewis Longman Walker
3/13/2012 Item 5. B.
TABLE OF CONTENTS ........ ........................................................... 4
SECTION A: SELECT PROJECT EXPERIENCE ................................................ 5
SECTION B: MINIMUM PROJECT PARAMETERS ................ ..............................7
SECTION C: CREDIT CALCULATION METHODS ............................................... 8
SECTION D: COST OF PACE CREDIT TO APPLICANTS ......................................... 8
SECTION E: PROGRAM TIME HORIZONS & COLLATERAL PARAMETERS ......................... 9
SECTION F: CREDIT RISK DUE TO PROJECT DELAY .......................................... 9
SECTION G: MINIMUM REQUIREMENTS FROM COUNTY AND/OR LOCAL PARTNERS ............... 9
SECTION H: CURRENT LEGAL & REGULATORY STATUS ...................................... 10
SECTION 1: INITIAL CAPITAL SOURCES.. . ................................................. 10
SECTION J: COLLIER COUNTY PROGRAM ALTERNATIVES ..... ............................... 11
SECTION K: ADDITIONAL RELEVANT INFORMATION ......................................... 11
SECTION L: MARKETING PLAN ........................................................... 11
SECTION M: MINIMUM LEVEL OF PARTICIPATION FOR SUCCESS .............................. 12
Packet Page -23-
3/13/2012 Item 5.13.
EcoCity Partners, L3C ( "EcoCity Partners" or "ECP ") is a West Palm Beach, Florida based low -profit limited
liability company (L3C) led by a team of experienced professionals who share the mission of facilitating
public - private partnerships for development of green community programs that result in cost - effective
financing of energy efficiency and renewable energy projects and installations. ECP serves as Renewable
Funding's exclusive Florida partner. ECP is led by: (1) Michael Wallander, J.D., LL.M., is a corporate and
securities lawyer who practiced law with the international firm, Greenberg Traurig, LLP, for seven years
representing a range of clients from Fortune 100 companies to start -ups and emerging businesses in the
solar, renewable energy and sustainability sectors; (2) Amy Elliott, a specialist in community outreach and
sales with particular consulting expertise in energy efficiency; and (3) Mo and Lance Eppley, specialists
in marketing and creative services, including the development of corporate and community marketing
strategies, website design and programming, and branding strategy program design and implementation.
Renewable Funding specializes in the delivery of design, administration, technology, and financing services
for clean energy retrofit programs. The firm has pioneered innovative financing mechanisms for residential
and commercial properties including property assessed models serving residential and commercial buildings.
The firm leverages decades of experience in capital markets to structure clean energy financing programs
that are attractive to private capital markets and maximize the impact of credit enhancements. As a
member of the U.S. DOE's ARRA Financial Technical Assistance Team, Renewable Funding is closely involved
in the development of new energy financing solutions and resources and can use this insight to guide the
development of a financing toot that best suits the needs of the particular communities it serves. The firm
has specifically led the development of commercial PACE programs and authored the DOE's Commercial PACE
Playbook for local governments. Renewable Funding is at the forefront of the development of commercial
PACE financing and brings comprehensive knowledge of current best practices as a co- author of an update on
commercial PACE programs with the Clinton Climate Initiative and Lawrence Berkeley Lab.
Lewis, Longman ft Walker ( "LLW ") has been helping shape Florida's future since its inception in 1994. LLW
provides solutions to the problems facing Florida's individuals, businesses and governments, especially issues
associated with the myriad of current local, state, and federal taws and regulations. The firm's vision is
personalized high quality legal services, focusing on specialized and often technical areas of environmental
and land use law, employment law, government relations, public finance and real estate law. Currently,
there are approximately 30 lawyers and a total of about 85 employees firm -wide, and the average annual
revenue over the past five years is approximately $11.5 million. LLW lawyers are committed to responding
to clients' needs promptly and economically. LM believes in building long- term relationships based upon
close cooperation and solid results. Services are provided throughout Florida from four offices strategically
Located in Bradenton, Jacksonville, Tallahassee and West Palm Beach.
Packet Page -24-
[=1
3/13/2012 Item 5.B.
American Recovery
Renewable Funding is a lead provider of technical assistance
Chris Lohmann,
£t Reinvestment Act
for municipalities using ARRA funds to launch PACE commercial
Financial Markets
(ARRA) - Finance Market
programs. The firm authored the PACE Commercial Playbook for local
Specialist, U.S.
Transformation Team
governments and provides general information and technical support
Department of Energy
Subcontractor of The
on financial structures and approaches for PACE commercial programs
Cadmus Group, Inc. for
the U.S. Department of
Energy
Energy Upgrade
Renewable Funding is the technology lead in the development of the
Panama Bartholomy,
California - Statewide
Energy Upgrade California program, a statewide retrofit program
Deputy Director,
comprehensive energy
that seeks to transform the market for energy efficiency through the
Efficiency and
efficiency retrofitting
streamlined delivery of information, incentives, contractor programs,
Renewables Division,
program
and financing options. The firm works with the California Energy
California Energy
Commission, Public Utilities Commission, utilities, local governments,
Commission
non - profits and private sector to develop a statewide portal that
guides consumers through the retrofit process and seamlessly provides
all relevant information.
GreenFinanceSF -
Renewable Funding is the designer, administrator, and technology
Johanna Partin
Countywide effort
provider for the residential and commercial GreenFinanceSF PACE
Director of Climimatat e
program. The firm created the first "fully integrated" PACE financing
protection Initiatives,
program that incorporates external rebates /incentives to maximize
property owner savings, thus ensuring highest possible uptake. The
Office of the Mayor
firm is working with the city to develop one of the first "owner
arranged" PACE financing programs that allows for the delivery of
private capital directly to individual commercial property owners.
Santa Fe -
Renewable Funding worked with the County of Santa Fe to develop a
Duncan Sill, Economic
Countywide effort
residential PACE program that has been suspended due to regulatory
Development, Santa
action. Renewable Funding has since led the adaptation of the program
Fe County
to serve commercial properties and has managed commercial market
surveys, program design, and development of a financial structure
Greenbiz Energy EcoCity Partners, Renewable Funding and Erin Deady of Lewis Longman Lake Worth Chamber
Collaborative, Lantana, lr Walker consulted with the Lake Worth Chamber of Commerce and of Commerce
FL (Grant Design l Town of Lantana on the design of a grant application that placed
Procurement Pending) ': 1st out of 120 applications and is in line for full U.S. Department of
Energy (DOE) funding from the Florida Energy Ft Climate Commission.
The Lake Worth Chamber of Commerce grant approach is to create a
green business certification and energy retrofit financing program. The
program will more specifically include financing commercial energy
retrofits utilizing an innovative financing structure, a green business
certification program and education and outreach components. This
same team also consulted on a follow -up grant application on behalf of
the Town of Lantana pending with the U.S. Environmental Protection
Agency (EPA) on expansion of this program to include additional local
governments representing an aggregate population of approximately
5 million who are exploring a combined commercial energy efficiency
and renewable energy retrofit program.
Packet Page -25-
3/13/2012 Item 5. B.
Minimum project parameters depend upon the community's resources and policy goals, the size and
composition of the commercial building stock, and the market conditions related to energy efficiency and
renewable energy in buildings. Property Assessed Clean Energy (PACE) Financing is a flexible mechanism that
can be used to deliver financing to a range of building types, technologies, and capital sources depending
upon program design. In order to serve the greatest number of buildings in the community, the program
team proposes the development of a platform that would be used to deliver financing at different rates and
terms from different sources depending upon the restrictions and requirements of individual projects.
Due to the actions of the Federal Housing Finance Agency (FHFA) and other regulatory agencies, which
is described in Section H, PACE financing should be restricted to energy efficiency and renewable energy
improvements to commercial buildings. A standard set of underwriting requirements will also need to be
developed that will apply generally to all participants, though some projects may utilize more stringent
underwriting standards as determined by the capital provider.
We understand from the RFl that "it is vitally important and a requirement imposed by the Collier County
Commission that a PACE Project NOT (1) financially encumber Collier County or its Board of Commissioners;
and (2) negatively affect or potentially affect the County's bond rating." Accordingly, we will assume that
there is no public funding available to seed or support a PACE Program in Collier County. Given the limited
funds and relatively small market, Collier County would likely be best - served by partnering with other
neighboring jurisdictions to increase the depth and attractiveness of the market to third party financiers,
particularly given the expectation that Program set -up costs would need to be recouped through the
financing offered to property owners.
These numbers suggest that Collier County would be best -served by partnering with other neighboring
jurisdictions to increase the depth and attractiveness of the market to third party financiers, particularly
given the expectation that Program set -up costs would need to be recouped through the financing offered to
property owners.
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3/13/2012 Item 5.13.
The structure of a PACE security reduces risk to lenders and many PACE programs have used governmental
funds for credit enhancements that further reduce lender risk and improve rates to participants. However,
the calculation of credit is predominately determined by the underlying credit of the property which is
based on a number of factors including, operating income, vacancy rates, credit history, and property
related debt. Because creditworthiness will vary significantly within the County, a flexible platform for PACE
financing is preferred that will allow for the possibility of pooling and selling a group of assessments as a
bond (pooled bond approach) as well as allowing one off financings between individual property owners and
capital providers (owner - arranged approach). Ultimately the rate will be determined by the bond purchaser/
capital providers based upon their assessment of the projected risk.
As discussed above, the rate will be ultimately be determined by the capital provider based upon the
underlying creditworthiness of the bond pool or individual project and any credit enhancement that the
County is able to provide. White the underlying credit of projects in Collier County will not be identical to
other communities, existing programs can be used to assess the range of rates that may be offered. Boulder
County was able to offer commercial PACE rates under 3 %, not inclusive of closing costs, however this rate
is based upon the use of the county's QECB allocation, and the existence of robust credit enhancements.
Other communities like Sonoma County are offering interest rates in the 7% range. There are not yet any
operational owner - arranged programs, but pretimary discussions with capital providers suggest that interest
rates will Likely be 7 -9% .
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3/13/2012 Item 5. B.
To the extent that this question seeks information about the typical term of financing, as with the above,
the financing term and collateral parameters depend to a significant extent upon local program and project
characteristics. Generally, however, this is based to a Large extent on the useful life of the equipment being
installed on the property and is generally amortized over periods no greater than 20 years. The collateral
parameters will also depend upon the relative position of the lien (typically senior and co-equal with the tax
lien), the property's history of utility and/or property tax payments being made on time, sufficient equity
in the property and a reasonable Lien-to-equity ratio (which has proven in the limited number of projects to
date to be in the range of 1:10). To the extent that this question seeks information about the length of time
that an initial capital investment would be needed to kick-start a program utilizing some form of interim or
aggregation financing before a sufficient number of bonds could be pooled and resold (typically in a standard
municipal bond tranche size of $100 - $150 million), this will depend upon market interest.
There are several ways to mitigate risk due to project delay or incompletion through program design. The
design wilt necessarily depend upon the type of financing approach and the Local governments preferences.
Generally the timing of Lien recordation and timing of the placement of funds in escrow can be planned to
mitigate this risk.
It is difficult to place any minimum requirements under which any financing contract could proceed with
Collier County. Assuming that Collier County has little financial resources or the ability to pledge its bonding
capacity for the benefit of a PACE Program, it would be both preferred and recommended for the County
to take a conservative approach to Launching its PACE Program by first exploring grant opportunities or the
ability to opt-in town existing program that is already funded in some way in order to streamline program
costs.
, rx
Packet Page -28-
3/13/2012 Item S.B.
Residential PACE programs have largely been put on hold due to opposition from the Federal Housing Finance
Agency (FHFA), and other regulatory agencies. These regulatory agencies are currently in litigation with
many of the jurisdictions in which PACE programs have been initiated, including Leon County, Florida, who is
being represented in that case by Erin Deady and Lewis, Longman Et Walker (Leon County v Federal Housing
Finance Agency, et at, Case No.: 4 :10CV436- RH /WCS, United States District Court for the Northern District
of Florida). The PACE cases in California and, of utmost importance for Collier County's consideration, Leon
County, Florida continue to proceed for the time being with Motions to Dismiss and Responses pending with
the various courts. There is also the potential for a resolution of the regulatory obstruction of residential
PACE programs through federal legislation.
While FHFXs opposition was restricted to residential PACE, the Office of the Comptroller of the Currency
(OCC) also issued guidance that stated that "safety and soundness concerns" exist and specifically included
commercial PACE. However the letter did not expressly state that adverse action would be taken and
conversations between PACE advocates and the OCC indicate that the agency opposes programs but does
not intend to take any adverse action at this time. Commercial PACE programs require the consent of the
current mortgage holder, which protects the interest of lenders, making additional action to protect such
Lenders unnecessary.
EcoCity Partners and Renewable Funding have access to mufti- million dollar aggregation financing for
commercial PACE projects as well as relationships with national and regional banks interested in supporting
commercial PACE programs. In addition to this funding, the goal of the program team would be to develop a
flexible platform that would allow for the delivery of capital from multiple sources.
o__
.. _ .
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�o
3/13/2012 Item 5.B.
As noted above, Collier County should first examine opportunities to streamline costs by partnering with
neighboring governments in a common program that is ideally funded with grants. One such program is
the mutti-jurisdictional program being Launched by the Town of Lantana, FL with funds procured from
the Florida Energy Et Climate Commission. The EcoCity Partners / Renewable Funding team is pursuing
the opportunity to implement the Lantana multi - jurisdictional program. Collier County should consider
reaching out to the Town of Lantana to explore a partnership. EcoCity Partners Et Renewable Funding
would be willing to explore this question in more detail in meetings with Collier County or in response to a
competitive procurement.
EcoCity Partners Et Renewable Funding would be willing to consult with Collier County to explore how a
successful PACE commercial program could be Launched within the County in the most effective, efficient
and expeditious manner possible.
The marketing and community outreach plan is a critical component of any particular PACE Program, with
messaging targeted to the various stakeholders who have an interest in the Program. The program team
plans to make information generally available to property owners while specifically targeting key marketing
channels. These channels include specific outreach to Large property owners, associations Like chambers
of commerce and Building Owners and Managers Association (BOMA), as well as companies that provide
commercial energy efficiency and renewable energy services.
Packet Page -30-
3/13/2012 Item 5.13.
In order to offer a pooled bond product, the county will likely need to be able to aggregate a pool of at least
a million dollars in cumulative project costs. Depending on the types of projects this pool may be made up
of 5 -20 properties. The attraction of capital for an owner - arranged financing will depend upon the size and
credit quality of individual buildings and will not be based upon volume of projects.
If the County chooses to launch it's own program there will be a threshold level of participation needed to
recoup the cost of program administration, however if the county opts into another program these concerns
are significantly diminished.
Packet Page -31-
3/13/2012 Item 5. B.
Policy Brief
Property Assessed Clean Energy (PACE) Financing:
Update on Commercial Programs
March 23, 2011
Packet Page -32-
CLINTON
-�MAT E
INITIATIVE
RENEWABLE
FUNDING
March 23, 2011
Packet Page -32-
CLINTON
-�MAT E
INITIATIVE
3/13/2012 Item 5. B.
This page intentionally left blank
Packet Page -33-
3/13/2012 Item 5.B.
Executive Summary
Since 2008, 24 states and the District of Columbia have authorized Property Assessed Clean
Energy (PACE) under state law, and state and local governments initially allocated over
$154 million in federal grant funds to help launch programs.' However, actions taken by
the Federal Housing Finance Agency (FHFA), the Office of the Comptroller of the Currency
(OCC) and other financial regulators in mid -2010 froze most residential PACE programs.
Commercial PACE programs were not directly affected by these actions and are moving
forward in a number of cities around the country.2
This policy brief provides an overview of all currently operating commercial PACE
programs, including project data, the various financing mechanisms that are being piloted,
and common challenges across programs. The policy brief also includes a summary of
programs in the mid- to late developmental stage.
Key findings,
• 71 projects have been Table ES- 1. Summary of Approved PACEConiniercial
approved and financed in i Projects
the four active commercial Approved Total Approved Average Range of
PACE programs, Projects Funding Project Size Project Sizes
representing about $9.7 71 $9.69M $138K $2K 42.3M
million in energy efficiency and renewable energy project investments (see Table
ES -1).
• In all active and planned programs, the existing mortgage holder must provide
written consent or formal acknowledgement for the property to participate in the
program. Mortgage lenders from local, regional and national banks have provided
their approval for these projects.
• While all existing programs are utilizing government capital or credit to provide
financing for PACE projects, the programs scheduled to launch in 2011 will rely
primarily on private capital complemented by federal grant money for credit
enhancement purposes.
These PACE programs were included in the initial plans and budgets filed by state energy offices and local
governments under the State Energy Program (SEP) and Energy Efficiency Community Block Grant (EECBG)
programs to utilize American Recovery and Reinvestment Act finds, most PACE program funds have since been
redirected to other initiatives.
` Some regulatory risks rwnam for conunercial PACE. For more information on regulatory action on residential and
commercial PACE, please visit Lawrence Berkeley National Lab's "PACE Status Update ":
http: / /eetd.lbi. eovfea /emsirel)orts/ee -pol icybriefOS I I l 0,ndf
PACE Financing: I of 14 March 23, 2011
Update on Commercial Programs
Packet Page -34-
• The improvements
financed have varied
by program (see Fig.
ES -1). For example, the
majority of financings
approved by Sonoma
County (CA) will or
have funded solar PV
projects, while Boulder
County's projects are
predominately energy
efficiency. This may be
due to climate, local
incentive structures, or
other factors.
3/13/2012 Item 5.B.
Fig. ES -1. Plumber of Approved Projects by Program & Type
t
Plac -r County
Palm Desert
Boulder County M�
Sanomz Co4nty
S ltl 15 ?Q )i 3t}
4 Approved Projects
New commercial PACE programs are launching
around the country and more significant
project volumes are expected by the end of
2011 (see Table ES -2). An overview of the
programs that have recently launched or are
planning to launch in 2011 appears below.
PACE Financing: 2 of 14
Update on Cornmercial Programs
Packet Page -35-
■ Renewable Energy Only
R Energy Efficiency Only
V Energy Efficiency and
Rer,ewahie Fn "gy
Table ES-2.
PACE Programs
Operational Programs 4
Programs in Design
9
Preliminary Planning
4
Total
17
March 23, 2011
3/13/2012 Item 5.13.
Commercial PACE Financing
Property Assessed Clean Energy (PACE) is an innovative municipal finance mechanism that
allows property owners to finance energy efficiency and renewable energy projects - such
as HVAC system upgrades, cool roofs, and solar photovoltaic systems - as a property tax
assessment. The debt is typically secured by a senior lien on the property, which helps
programs attract private capital at competitive rates and terms.3
Historically, much of the attention on PACE focused on its applicability to residential
properties. in the wake of the actions of the FHFA, OCC and other financial regulators in the
summer of 2010, more attention has shifted to the commercial building market.
This report provides an overview of all currently operating commercial PACE programs and
a summary of programs currently in development.
An overview of commercial PACE, including financial structures, regulatory issues,
American Recovery and Reinvestment Act (ARRA) compliance, and accounting, is provided
in Appendix A.
PACE Programs
There are currently four commercial PACE programs in operation and nine in design, many
of which are expected to launch in 20114 To date, active programs have approved $9.69
million of financing for 71 projects (see Table 1).
Operational Programs
The four operational PACE programs vary significantly in design, funding source, and size.
These differences reflect the resources available to the government sponsors, the building
stock, and the incorporation of best practices over time. All of the operational programs are
supported by public funds (e.g., for credit enhancement purposes or direct investment) and
the rates and terms offered by these programs do not necessarily reflect market rates for
private capital. Program data through January 2011 is summarized in Table 2.
3 For more information regarding PACE please see "How to Guide on PACE Financing" (Fuller. Kunkel. Kammen
2009): Irttp:( /rael.berkelev.edtL +f nancinefresources
S In addition to those in formal planning stages. Cleveland. Ohio. Cutler Bay Florida. New Orleans.. Louisiana. and
Sacramento. California have begun preliminary planning to launch PACE commercial progimm.
PACE Financing: 3 of 14 March 23, 2011
Update on Commercial Programs
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3/13/2012 Item 5. B.
Table 2,
Commercial
PACEPrograms
in Operation
Have Financed
71
Projects
Program
Approved
Total
Average
Interest
Term
Source of
Finance Structure
Projects
Approved
Project
Rate
(in
Funding
Required
Funding
Size
No
ears
Sonoma
37
$7.27M
$196K
7%
Up to
County
County,
24
Treasury
CA
Boulder
29
$1.52M
S51K
1.04% or
5 or
Moral
County,
2.29%5
10
Obligation
CO
Bond
Issuance
wl OECB
Placer
2
$319K
$160K
7.25%
Up to
County
County,
20
Treasury
CA
Palm
3
$575K
$192K
7%
Up to
city
Desert,
20
Backed
CA
Funds
Sonoma County Energy Independence Program (SCEIP): Launched in spring 2009,
SCEIP is open to both residential and commercial customers (see Table 3). The County is
able to offer on- demand
financing to property owners
since the program is funded out
of the County Treasury. The
County is exploring the use of a
takeout strategy so that it can
replenish the funds it has
already extended.
While the program provides
financing for a wide variety of
renewable energy, energy
efficiency and water efficiency
ro ects 950/ of funds for
'Fable 3. Sonoma County
Range of Project Size
Program Statistics
Min $9.6K; Max $2.3M
Project Mix -�
25 Renewable Energy Only
7 Energy Efficiency Only
3 Energy Efficiency & Renewable
Energy
1 Energy Efficiency & Water
1 Unspecified
Finance Structure
Warehoused
Source of Funds
County Treasury Funds
Lender Consent and /or
Yes
Acknowledgment
Required
Acceleration
No
P l o
commercial building projects have gone to
fiend solar PV (48 %) and cool roofs (47010)
(see Figure 1). The 25 solar PV projects will
total over half a megawatt and range in size
from under 10kW to over DOM Six of the
projects include cool roofs ranging in cost
from $7,000 -$2.3 million. The remaining
commercial building projects are solar
Fig. 1.5onorna County Percent of Funds
by Project Type
Cthcr —.
c.nn. RndF
Sour r' +!
0% Z0% 2056 30% 40% 50%
5 Interest rates are 1.04% or 2.29% for projects with a five -year or ten -year tern. respectively. hi
addition to the interest rate capital expenses equal to 8.49% (five -year term) and 4.27% (ten -year term)
of the project cost are added to the financed amount to cover administrative and other expenses incurred
by the County over the lives of the assessments.
PACE Financing: 4 of 14 March 23.2011
Update on Commercial Programs
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3/13/2012 Item 5.B.
thermal (2 % %), HVAC (1 %), and other energy and water efficiency measures such as lighting,
windows, and insulation.
Boulder County ClimateSmart Loan Program: Boulder, CO pioneered the pooled bond
method and has successfully completed two residential and one commercial bond issuances
(see Table 4).6 These bonds are backed by a moral obligation from the County. This moral
obligation has enabled
the County to issue debt
at attractive rates and to
pass on these low
interest rates to
participants. Boulder
further reduced the
interest rate for the
commercial program by
using a portion of its
Qualified Energy
Conservation Bond
(QECB) allocation.?
Boulder collected data
on the value of
participating properties,
allowing program
administrators to track
the lien -to -value ratio
(LTV) of the
assessments. 90 % of
the assessments have a
LTV that is less than
1:10. Only one project
Table 4. Boulder County Program Statistics
Range of Actual Project I Min $2K; Max $20 0K
Size 1�
Project Mix
14 Renewable Energy only
22 Energy Efficiency Only
3 Energy Efficiency and Renewable Energy
Finance Structure
Pooled Bond
Source of Funds
Public Issuance of Qualified Energy
Conservation Bonds with a Moral
Obligation
Lender Consent and /or
Yes
Acknowledgment
Required
Lender Consenting
7 National. Bank
5 Regional Bank
5 Community Bank
3 other Lending Institution
8 Properties have no mortgage
1 Unspecified
Average Ratio of Financed
! 4.42%
Amount to Actual Property
Value
Acceleration ;Yes
Building Type 9 Office
6 Multi- family
5 Food Service
2 Small Manufacturing
2 Retail
5 Other
has an LTV significantly greater than the 1:10 threshold and this property does not have a
mortgage. This data suggests that the 1:10
LTV requirement may be sufficient to Fig. 2. Boulder County Percent of Funds by
maintain demand for PACE financing, Project Type
however Boulder County property values q
are high and the financing amounts are low sober`Wire'
relative to other programs.
ins�lanar
snc.ia•.nE��or�s�rd/wuidows ,...._.,r.
Boulder's PACE program has financed a Cont Root --- j
wide range of building types and measures s,oarPV -- -Y
(see Figure 2). The diversity of building Ul. ar Energy t`nciarcy
types in the pool suggests that PACE 144AC
financing may have wide applicability
despite split incentive challenges in multi-
family and other leased buildings. The majority of measures were energy efficiency
improvements. By cost, 30 % of financing went to HVAC units, 11% to solar PV, 11% to cool
For more information on the pooled bond PACE model. see Appendix A.
For more information on QECBs. see Appendix A.
PACE Financing: 5 of 14 March 23, 2011
Update on Continercial Programs
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3/13/2012 Item 5. B.
roofs, 8% to insulating doors and windows, 6% to insulation, 5% to solar hot water and the
remaining 29 %Q to other efficiency measures such as lighting, retro - commissioning, and
energy management systems.
Palm Desert Energy independence Program: Palm Desert, CA launched the first PACE
program in 2008 and officially reopened its application process in August of 2010 after a
short suspension to review
FHFA guidance. The hot
climate makes solar, HVAC,
and other efficiency
measures especially cost
effective for many building
owners. The program has
primarily funded renewable
energy and energy efficiency
improvements to residential
buildings but it is also open
to commercial properties
Table 5. Palm Desert
Program
Range of Project Size
Min $23K; Max $522K
Project Mix
1 Renewable Energy Only
Finance Structure
2 Energy Efficiency Only
Finance Structure
Warehoused
Source of Funds
Municipal Funds and
Lender Consent and /or
Redevelopment Agency Bonds
Lender Consent and /or
Only for projects over $30K
Acknowledgment
Required
No
Acceleration
No
Building Type
2 Retail
i Office
and has funded two HVAC replacements and one solar PV system in that market (Table 5).
mPOWER Placer County: Placer County, CA began to focus on providing PACE financing to
commercial building owners in
2010. The program provides
funding for both energy efficiency
and renewable energy
improvements. Both lender
acknowledgment and a 1:10 lien -to-
value ratio are required to
participate in the program.
Table 6. Placer County
Program Statistics
Range of Project Size
Min $121K; Max $199K
Project Mix
2 Renewable Energy Only
Finance Structure
Warehoused
Source of Funds
County Treasury
Investment
Lender Consent and /or
Yes
Acknowledgment
Required
Acceleration
No
1 Motel
Two commercial projects have been
Building Type 1 Plant Nursery
funded and the county is processing
twelve other applications (Table 6). Many of these applicants are manufacturing facilities.
About two thirds of the proposed projects are solar PV and the remaining third are energy
efficiency projects. The program covers two climate zones and operates in collaboration
with two municipal utilities and one investor owned utility.
Currently, $33 million is committed for financing through the County Treasury with an
additional $22 million available. At a future date, the county plans to sell the PACE bonds
purchased and held in the County Treasury to replenish program funds for ongoing
financing.
Programs In Development
The majority of PACE programs in development were specifically designed to serve
commercial markets, rather than being adapted from existing residential programs. These
programs Will generally use private capital to fund improvements but most will still rely
upon credit enhancements like debt service reserves to attract private capital and to lower
rates for potential participants.
PACE Financing: 6 of 14 March 23. 2011
Update on Commercial Programs
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3/13/2012 Item 5.13.
City of Ann Arbor, MI: Michigan recently passed RACE enabling legislation that would
allow its municipalities tolaunch commercial PACE programs. The City of Ann Arbor is
planning to launch u PACE commercial pilot later this year and may allocate a portion o{its
ARRA funds tn capitalize a debt service reserve fund.
California PACE Program: The California PACE Program ixo privately-funded, state-wide
program. The program is administered through the Pacific Housing Finance Agency (PBFA),
a CA State joint Powers Authority CJPA). Any city or county in the State of California can join
the program, which will use its existing bonding authority (currently $9S million and optu
$2 billion) to raise capital for projects that have been aggregated across multiple
jurisdictions and meet certain eligibility requirements (e.g., lien holder consent obtained).
Using this aggregation approach, the program aims to secure greater access to capital and
lower transaction costs for local PACE programs and the projects that they fund. As of
March 2011, eight cities have obtained the necessary approvals to join the program
including Tulare, Fresno, Palm Springs, Farmerville, Woodlake, Adelanto, Exeter and
CuliDatrio. The California PACE Program has received over $4 million iufunding
applications and expects to aggregate energy retrofit applications already received for an
initial bond offering iu second quarter 2011.
City of Los Angeles, CA: The Community Redevelopment Agency of the City of Los Angeles
(C}A/LA) is currently developing the Energy Upgrade Los Angeles Commercial Building
Performance Initiative to catalyze holistic energy and water performance upgrades buLos
Angeles' existing non-residential commercial buildings. The primary goal of the program is
to enable PACE financing o[ single building projects under the ''omnmer'arrauged^muodeLnio
which owners negotiate and obtain fioauciogdirectly from capital providers. The program
will also accommodate alternative approaches tofioaocimg projects iu the event that the
building owner is unable to secure mortgage holder consent to a PACE assessment. The
Initiative will use ARRA monies to fund no-cost energy audits for property owners and to
provide appropriate levels of credit enhancement for the program's initial projects.
Program launch is slated for the second quarter mf2Ol1.
Northeast Ohio: The Northeast Ohio Advanced Energy District (AED)io Ohio's first energy
special improvement district (Ql[).a eotityioozrparotedinQaceomber281O
bv the City of Cleveland and 14 inner ring suburban municipalities of the First Suburbs
Development Council. The Economic Development Directors of each municipality serve on
the AED Board and two staff are currently working on program design with an expected
program launch date of Summer 2 011. The AED enables commercial and industrial
property owners io the 1GA£D member communities toinstall and finance energy related
projects, including solar electric, solar thermal, wind, geothermaL biomass and energy
efficiency related technologies.
City and County mf San Francisco, CA: The City and County of San Francisco is using AR}bA
funds to develop azommercial PACE pilot program as part of their GreenFinanceSF
program. San Francisco intends to use the "owner-arranged" model, at least initially. The
portfolio of projects will be supported by an ARRA-furided debt service reserve.
Santa Fe County, NK The County of Santa Fe created its PACE district in October 2009and
is designing aormmercialPACE pilot prograoo. Due {o the nature of New Mexico's PACE
»For inorembrtuationou the mxmer-mmigedPACE niodel.oee Appendix A.
PACE 7oy14 &8mnch 23, 2011
Update uoCmunercialPrograms
Packet Page -40-
3/13/2012 Item 5. B.
enabling legislation, the program will restrict financing to renewable energy measures. The
program will likely use the pooled bond approach and plans to attract private capital by
using ARRA funds to capitalize a debt service reserve.
Washington, D.C.: The Washington, D.C. Mayor's Office of Planning and Economic
Development is finalizing a contract with its PACE program administration partner. The
contract should be in place soon with program launch slated for mid - 2011. Commercial and
multifamily properties will be eligible to participate, making PACE financing available to
approximately 75% of the buildings in Washington, D.C. The District plans to use revenue
bonds to fund a pilot of $25430 million of energy improvements —it has $250 million of
total bonding authority. Fourteen major property owners own the majority of buildings in
downtown D.C., and the program plans to do aggressive outreach to these owners in order
to promote energy improvements on a diverse portfolio of buildings.
Western Riverside Council of Governments (California): The Western Riverside Council
of Governments (WRCOG), which consists of 17 cities, the County of Riverside and two
water districts, is developing an energy efficiency and water conservation program that
would allow commercial property owners to implement energy and water efficiency
improvements using PACE assessments. The program will utilize specific credit
underwriting guidelines including minimum property LTV and project debt service
coverage ratios in determining loan eligibility. The program is expected to fund projects
through the sale of bonds by WRCOG. WRCOG is simultaneously developing a separate
program to fund large solar projects in commercial buildings. Initially, up to $25 million will
be made available for financing projects. The program plans to begin accepting solar project
applications in May or June of 2011.
Melbourne, Australia: The City of Melbourne launched the 1200 Buildings Program
in March 2010 with the aim of catalyzing the retrofit of at least 1,200 predominantly
non - residential buildings in the municipality. The program is the first of its kind in
Australia. The ultimate goal of the program is to save five gigalitres of potable water
and reduce energy use in these buildings by 38 %, mitigating 383 kilotons of
greenhouse gas emissions. The program identified a lack of commercial funding as
one of the key barriers to implementing environmental upgrades to existing
buildings, The City of Melbourne aims to overcome this barrier by partnering with
Australian financial institutions and entering into voluntary arrangements with
property owners for the purpose of securing project financing. The financed amount
for each project is declared against the property as an Environmental upgrade Charge
(EUC) and the City of Melbourne levies this charge annually. The 1200 Buildings
Program is managed through a strategic partnership between the City of Melbourne
and the Sustainable Melbourne Fund CSMFI.
PACE Financing:: 8 of 14 March 23, 2011
Update on Commercial Programs
Packet Page -41-
3/13/2012 Item 5.B.
Conclusion
Preliminary data from the four operational programs indicates that PACE financing has the
potential to serve a variety of building types and is suitable for financing a range of energy
efficiency and renewable energy improvements. This data also suggests that underwriting
criteria like lender consent /acknowledgement and maximum lien -to -value (LTV) ratios may
be sufficient to responsibly deliver PACE financing to commercial building owners.
Participating property owners have had success in obtaining consent /acknowledgement
from mortgage holders including local, regional, and national lenders and approved
financings have largely met a 1:10 LTV ratio.
This data is encouraging, but cannot be widely extrapolated since many of the programs
launching in 2011 will utilize different financing structures, credit enhancements, and will
serve substantively different markets. Both Los Angeles and San Francisco will pilot the
owner - arranged financing model and will serve major urban markets. New programs will
also test the ability of PACE to attract capital without the use of municipal funds or
governmental backing.
PACE Financing: 9 of 14 March 23. 2011
Update on Commercial Programs
Packet Page -42-
3/13/2012 Item 5.13.
About the Authors of this Policy Brief
Renewable Funding: Renewable Funding specializes in design, administration, technology,
and financing solutions for clean energy retrofit programs. Since 2008, the firm has worked
with over 200 communities to structure residential and commercial financing programs.
Renewable Funding is internationally regarded as an innovator in the clean energy financial
marketplace. The firm has pioneered property assessed clean energy (PACE) models for
residential and commercial properties, including leading the launch of the seminal
BerkeleyFIRST program. The firm also works, in close partnership with leading financial
institutions, to develop a secondary market for clean energy products. For more
information, visit: www.renewfund.com
Clinton Climate Initiative: The William J. Clinton Foundation launched the Clinton Climate
Initiative (CCI) in 2006 to create and advance solutions to the core issues driving climate
change, Working with governments and businesses around the world to tailor local
solutions that are economically and environmentally sustainable, CCI focuses on three
strategic program areas: reducing emissions in cities, catalyzing the large -scale supply of
clean energy, and working to measure and value the carbon absorbed by forests. In each of
these programs, CCI uses a holistic approach to address the major sources of greenhouse
gas emissions and the people, policies, and practices that impact them. CCI is the delivery
partner of the C40, an association of large cities around the world that have pledged to
accelerate their efforts to reduce greenhouse gas emissions. CCI has extended the benefits of
its cities programs to a number of additional public and private sector partners. CCI cities
programs include energy efficiency building retrofits, outdoor lighting, waste management,
low carbon transportation, urban developments and CO2 measurement and reporting. CCI
is a non -profit organization that operates from an independent and unbiased perspective
and has no financial interest in any project that might be developed as a result of its
involvement. Its work is funded through charitable donations from individuals and private
foundations. For more information, visit: httn: / /www.ciintonfomidatioii.org/cci
Lawrence Berkeley National Lab: Within the Electricity Market and Policy area, Lawrence
Berkeley National Lab (LBNL) analyzes public interest policy issues and conducts research
projects on key electricity market issues, including electric power system reliability, energy
efficiency, demand response, renewable energy, distributed energy resources, and energy
sector modeling. For more information, visit: htW:I/eetd.lbl.gov/EA/EMPleml2.htTnI
PACE Financing: 10 of 14 March 23, 2011
Update on Commercial Programs
Packet Page -43-
3/13/2012 Item 5.B.
Appendix A — Overview of Commercial PACE
Property Assessed Clean Energy (PACE) financing programs allow state and local
governments, where permitted by state law, to extend the use of land-secured financing
districts to fund energy efficiency and renewable energy improvements on private property.
PACE programs attach the obligation to repay the cost of improvements to the property, not
to the individual borrower.
There are two major characteristics that make PACE unique in contrast to the traditional
use of land-secured financing districts. First, property owner participation is 100%
voluntary—only those property owners that choose to participate in the PACE program, or
purchase a participating property, pay the costs of the additional assessment. Second, PACE
financing can only be used to pay for prequalified energy efficiency and renewable energy
improvements on participating properties.
Commercial PACE Finance Structures9
Three main financing structures have evolved to support commercial PACE programs:
1. Warehoused: The municipality uses a large line of credit (in the millions of dollars),
or other credit facility, to fund qualified projects on an as-needed basis. When
sufficient project volume is reached, the portfolio can be sold through a municipal
revenue bond issuance or other capital markets transaction. The proceeds of the sale
replenish the line of credit and facilitate a new funding cycle. As an alternative to
private capital, local or state governments can choose to fund projects from their
general funds and/or investment portfolios.
2. Pooled Bond: Property owner applications for PACE financing are approved during
an aggregation period. When a sufficient pool of approved applications has been
assembled, the local government sells a bond to fund all of the projects and permits
property owners to proceed with their energy upgrades.
3. Owner Arranged. Property owners have the flexibility to independently secure
financing for a defined project with a lender of their choice. Financing terms are
negotiated independent of the municipality or state, and are predicated on 1) the
senior lien that the PACE mechanism affords and 2) the underlying credit of the
owner/building. This model is designed to avoid the timing delays associated with the
pooled bond approach (i.e., waiting to aggregate projects and waiting to issue a bond
in the market). This approach may be better suited for larger projects (e.g. greater
than $500K) and/or buildings with better credit.
Background on Federal Regulatory Issues
Most regulatory activity has focused on residential PACE programs as opposed to
commercial PACE programs.
9 More information on the three financing methods is available in the Department of Energy's "Cien Energy Finance
Guide for Residential and Couiniercial Building Improvements ":
V3Ch13Couimercia1PACEDec9.pd
PACE Financing: 11 of 14 March 23, 2011
Update on Commercial Progrmus
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3/13/2012 Item 5.13.
The Federal Housing Finance Agency (FHFA) issued a statement on July 6, 2010, that PACE
programs with senior lien position'O "present significant safety and soundness concerns
that must be addressed by Fannie Mae, Freddie Mac, and the Federal Home Loan Banks." In
particular, PACE liens were deemed to "run contrary to the Fannie Mae - Freddie Mac
Uniform Security Instrument...." —i.e,, the standard mortgage contract. This position has
halted most residential PACE programs in the U.S.
The FHFA letter was specific to home mortgage lending. The Office of the Comptroller of the
Currency (OCC), which regulates national banks, also issued PACE guidance in July 2010.
This statement raised additional concerns by specifically mentioning commercial properties
in its statement that "safety and soundness concerns" exist. However, the OCC did not
indicate whether commercial PACE programs could go forward. A detailed discussion of
this issue is included in a recent report by Lawrence Berkeley National Laboratory".
Efforts are underway to obtain further clarification from the OCC.
Generally speaking, commercial PACE programs with lender and owner consent and /or
acknowledgement provisions —both the existing lender and property owner must give their
written consent and /or acknowledgement for the PACE financing— provide robust lending
safeguards. PACE programs may also institute more explicit credit underwriting
requirements - such as maximum building loan -to -value ratio and maximum lien -to -value
ratio in an effort to protect existing lien holders and property owners from unnecessary
debt - related risks.
ARRA Uses and Requirements
Many commercial PACE programs are using American Recovery and Reinvestment Act
(ARRA) or other public funds to provide enhanced services and /or credit enhancement.
The funds can provide a valuable tool to reduce program and financing costs, but ARRA
funds come with significant reporting and other obligations.
There are several program design options that can use ARRA or other funds to reduce the
interest rate of PACE financing by reducing risk to capital providers. The most common
options are described below.
• Debt Service Reserve Fund: A debt service reserve fund (DSRF) equivalent to 5
10% (or more) of the issuance is commonly created to cover bond debt service (i.e.,
payments made to bond investors) in the event of late payments or defaults by
property owners.
Subordinate Capital: A common capital markets credit enhancement structure is a
"senior- subordinate" structure. In such an approach, the ARRA or other public funds
would he combined with private capital and provided for project financing rather
than held in reserve, In the event of a default, the losses are first borne by the
publicly- funded, subordinate piece of the investment. The private investor's senior
interest remains protected until losses exceed the amount of subordinate capital in
the financing.
10 Senior lien position refers to a debt having priority over all other debt on a property in the case of foreclosure
(i.e_, it gets paid off first before other outstanding debt, including mortgages). Most PACE programs use a senior
lien position for the PACE debt because the PACE assessments are part of the property taxes, and property taxes
are already senior to other property debt But there are some PACE programs that use a subordinate or junior
position instead, which means the mortgage has priority over the PACE debt.
11 littp:lieetd.lbl. eovlea/emsireports /ee- policvbrie f081 I I 0_pdf
PACE Financing: 12 of 14 March 23, 2011
Update on Commercial Programs
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3/13/2012 Item 5. B.
Qualified Energy Conservation Bonds (QECBs)12: State or local governments that
have access to allocations of QECBs can use them to fund PACE programs at below
market rates. QECBs are a type of qualified tax credit bond that can be used to fund
energy saving projects in public and private buildings (subject to limitation). Tax
credit bonds allow municipalities to borrow at lower effective interest rates because
the federal government subsidizes their interest payments to investors through the
use of a tax credit or cash-in-lieu of credit.
Obligation of Government Credit: While not a use for ARRA funds, it is important
to note that local or state governments can fully or partially guarantee repayment by
placing a general or moral obligation on PACE financings. Under a general
obligation, local or state governments pledge their full faith and credit to the
bonds—effectively guaranteeing that if tax receipts fall short, they will make up the
difference. With a moral obligation, the governmental body pledges to back the
bond, but makes no legal commitment to do so.
The use of federal ARRA funds to support PACE programs can trigger labor and
environmental laws.
Davis-Bacon and Prevailing Wage: Many federally supported programs must
comply with the Davis-Bacon Act, which requires the payment of a prevailing wage
to contractors utilizing the program. The U.S. Department of Energy has stated that
loan loss reserves do not automatically trigger Davis-Bacon as federal funds do not
flow to contractors,13 However, commercial PACE programs that use ARRA funds to
directly fund the installation of projects are subject to the requirements of the
Davis-Bacon act and must pay prevailing wages.14
National Environmental Policy Act (N EPA): ARRA funds used for credit
enhancement of a financing program—including a debt service reserve fund,
interest rate buy-down, or third-party loan insurance—are subject to federal
requirements including the National Environmental Protection Act (NEPA).15
Acceleration and Transferability
PACE assessments are generally treated as any other tax obligation and are often
transferred to the new owner upon sale of the property. Consequently, only delinquent
payments of the assessments are due if the property is foreclosed upon, instead of the
entirety of the assessment. This is referred to as a "non-acceleration" of payments. 16
12 More information available on QECBs at
liftp://,%w-wi.ecre-enereV.s!ov/wit)Jsolutionceater/fmancialpmduct§lQECB.litnil
13hW4WWw1.eere,ene=Rov/eere faa/detail search .aspx?IDOuestion=712&12id=10&spid=I
141ittv;/Iu,%-wl.eere.p=.jzov/wip/davis-bacon act.htnil
15 h=: /Iwmwl,eere.enerox.Fov/wil2/neL!a guidance.litin]
16 More information about the non-acceleration of PACE assessments can be found in the May 2010 LBL Policy
Brief by Zimring and Fuller "Accelerating the Payment of PACE Assessments"
http:/ieetd.lbl.goNi/ea,leiiis/reports/ee-policvbiief 050410. udf
PACE Financing: 13 of 14 March 23, 2011
Update on Coniniercial Progranis
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3/13/2012 Item 5.B
Pass Through
PACE assessments may be eligible for expense "pass- through" to tenants, depending on
lease structure and local law. In the case of net lease agreements, the pass- through of
assessments would allow owners and tenants to more equitably share in the costs and
benefits (e.g. lower utility bills) of the energy project. However, no accounting firm has
categorically determined the proper accounting treatment of PACE assessments, so owners
must rely on their own accountants' interpretation.
PACE Financing: 14 of 14 March 23, 2011
Update on Commercial Programs
Packet Page -47-
i
r
4
rene
ENERGY FUND
3/13/2012 Item 5.13.
Response to Request for Information:
11 -5716 — Property Assessed Clean Energy (PACE) Project
Collier County, FL
Co ier County
Admnistrative Services Division
Purchasing
C/o ECOASSET SOLUTIONS LLC
400 N. Tampa Street
Suite 2200
Tampa, FL 33602
p: 877 819 4736
p: 813 470 5000
www.ygrene-energy.com
(Company Confidential)
Packet Page -48-
tt9� 3rene
/13/2012 Item 5.B.
E N E R G Y Y FUND Collier Count y RFI 11 -5716
ITABLE OF CONTENTS
'
ExecutiveSummary ....................................................................................................... ..............................3
Staff Qualifications ....................................................................................................... ..............................5
'
ProjectSummaries ....................................................................................................... .............................10
Overview & Approach .................................................................................................. .............................14
'
Program Design ........................................................................................................... .............................15
FinancialModel ........................................................................................................... .............................16
'
Administration ............................................................................................................. .............................19
ContractorTraining & Certification ............................................................................... .............................21
Marketing& Outreach ................................................................................................. .............................22
Scopeof Work ............................................................................................................. .............................28
' Statement on FHFA Position ......................................................................................... .............................32
APPENDICES
' Appendix 1: Sonoma National Bank
' Appendix 2: Barclays Capital Experience
Appendix 3: Lockheed Martin Experience
t Appendix 4: EcoAsset Solutions Experience
Appendix 5: Willdan Experience
LJ
Company Confidential 900 College Ave Santa Rosa, CA 95401 2
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E N E R G Y F U N D Collier Count y RFI 11 577.6
EXECUTIVE SUMMARY
To achieve the goals of funding and launching a successful Property Assessed Clean Energy (PACE) program,
one that does not financially encumber the county nor negatively affect the county's bond rating, Collier
County will need a partner who has significant financial, marketing and administrative capabilities. Ygrene
Energy Fund is that firm, and along with our local and national partners, has all of the necessary capabilities to
develop, fund and administer a PACE program for the county.
Ygrene recognizes the county's desire to 'go green' and 'rebuild Collier's energy use', with a special focus on
putting people back to work, reducing energy use and costs, and securing independence from foreign oil. With
unemployment in the county at 13.5 %, Ygrene's contractor - focused program is designed for ease of use in
terms of targeting, bidding and completing retrofit and renewable projects. These projects in turn reduce
energy usage and costs for property owners — and less conventional (much of it from foreign sources) energy
used, the secure we are as a nation.
Ygrene Energy Fund, in partnership with Barclays Capital, EcoAsset Solutions and Willdan Financial, and in
association with Lockheed Martin Energy Solutions, (hereinafter the "Ygrene Team "), brings together a team
of reliable capital lenders and nationally- recognized commercial energy efficiency leaders to launch a PACE
program with Collier County (the 'County'). The Ygrene Team is the right team to work with the County based
on the following experience and strengths:
Ygrene has assembled a team of PACE lenders, residential, commercial and industrial energy efficiency
FP consultants, and expert personnel dedicated to ensure the County has the expertise and the capacity to
swiftly and efficiently launch the program.
7
• Barclays, as the primary source of funding, is the world's largest bank and a premier commercial and
municipal financing institution.
• Lockheed Martin Energy Solutions is a premier provider of energy engineering and efficiency services
and one of the largest implementers of utility energy efficiency programs in the country.
• EcoAsset Solutions is a wholly -owned subsidiary of Lykes Bros. Inc. and has worked with many local
Florida governments to develop commercial energy efficiency and conservation strategies and engage
and educate local businesses on energy - related topics.
• Willdan Financial provides District Administration Services to manage long -term collection of bonded
pay -as- you -go special taxes, assessments and fees.
Ygrene's commercial PACE program will provide the most cost - effective financing terms to the market.
Cost - effective loan terms will drive the market to install large energy- saving projects and realize the
environmental, economic, and social benefits that the County is looking for.
• The Ygrene /Barclays structure can finance 100% of the engineering and improvement cost of
qualifying projects, with off- balance -sheet debt, through a funding mechanism that can't be used for
other company investments or operations. This solves the capital competition problem that has, to
date, prevented widespread retrofit of the commercial and industrial sectors.
• Since the assessment is treated as if it were a tax, the costs of the energy saving and /or energy
generating improvements pass straight through to the tenant under most leases, thereby solving the
"split incentives" problem that has prevented many clean energy and efficiency retrofits.
' Company Confidential 900 College Ave. Santa Rosa, CA 95404
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3/13/2012 Item 5.B.
Collier County RFI 11 -5716
Ygrene will directly invest a significant amount of up -front funds to ensure the PACE program launches
immediately and successfully. This represents an investment in a public /private partnership that develops,
finances and administers the program without cost to the County:
• District formation and Bond validation
• Program design including Policy statement and all Program forms
• Marketing and outreach; Localized web portal
• Contractor certification and on -going training
• Online application, project management and energy audit tools
• Program administration and support; District management reporting
IAbout Ygrene
' In the Spring of 2006, Dennis Hunter and Alan Strachan formed a partnership to bring market forces to bear
on the problem of climate change. As Ygrene's Chairman, Mr. Hunter, arranged and co- founded a four -bank
lending system called Green Energy Loan (GEL) for the purpose of facilitating loans that would enable
homeowners to cost effectively retrofit their homes to reduce carbon emissions. This project led, in part, to
the inception of Sonoma County's PACE Program. In response to the success of the Sonoma County PACE
program, Mr. Hunter realized the need for a more efficient administrative and financial model. GEL quickly
' added software development personnel, began work on the web tools needed to underpin a fully scaled -up
PACE program and recruited a management team to propagate the business throughout the country. The
team also refined the business model, began software development and created marketing plans, resulting in
' the adoption of Ygrene Energy Fund as the company's name. In the summer and fall of 2010, Ygrene entered
into discussions with Barclays Capital to secure the strong financial partner that would provide the backbone
for the business. With the addition of Barclays, Lockheed Martin, EcoAsset Solutions, Willdan, the United
States Business Council for Sustainable Development (US BCSD) and the Carbon Trust, Ygrene is now in a
position to offer turnkey PACE program development, implementation, financing and administration
throughout the country.
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STAFF QUALIFICATIONS
' Ygrene Team
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3/13/2012 Item 5.13.
Collier CQ-Unty RR 1.1- 571.6
To carry out its comprehensive approach to financing commercial and industrial energy retrofits, Ygrene has
assembled industry leaders to develop and implement every aspect of the program as efficiently as possible.
Ygrene assembled its team for the express purpose of offering a full commercial and industrial program at
zero cost and zero general fund exposure to cities and counties. Ygrene's team includes:
• Barclays Capital: Barclays is a major global financial services provider engaged in investment banking,
retail and commercial banking, wealth management and investment management services in over 50
countries and has more than $2.2 trillion in assets. Barclays provides both aggregation and post -
assessment financing for conforming PACE projects.
• Lockheed Martin: Lockheed Martin helps utility customers conserve energy and protect the
environment, while simultaneously increasing operational efficiencies and maximizing the value of
their capital spending. Currently, Lockheed is providing energy engineering, technical support and
program management services for numerous governments and utilities that has resulted in over 1,200
gigawatt -hours (GWh) of annual energy savings for commercial and industrial customers and over 500
GWh of annual energy savings for residential and multi - family customers.
• EcoAsset Solutions: EcoAsset Solutions provides a comprehensive participant feedback loop and
outreach program designed to improve contractor certification and training programs.
• Willdan Financial Services: Willdan Financial provides District Administration Services to manage long-
term collection of bonded pay -as- you -go special taxes, assessments and fees.
Company Confidential 900 College Ave. Santa Ro ,a, CA 95404 5
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Management — Ygrene
Dennis Hunter, Chairman & CEO
900 College Avenue, Santa Rosa, CA 95405
E M E H G T F U M O dennis @ygrene- energy.com
t: 707 2916791 f: 707 579 4617
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Coiiier County RFI 11-5716
Dennis Hunter has over 40 years of diverse entrepreneurial business, banking and real estate development
experience. He was a co- founder of Sonoma National Bank, a nationally ranked community bank
headquartered in Santa Rosa, CA, and served as Chairman of its holding company board. Mr. Hunter's real
estate development activities include more than 35 projects, ranging from 100,000 square foot commercial
shopping centers to 450 unit mixed -use residential developments. He has proven to be a savvy investor,
trustee and investment strategist for many diverse investment funds and has started and funded a number
of successful businesses. Mr. Hunter started a high -end gift manufacturing business with distribution in every
major market across the US, servicing over 3,000 vendors including every high -end department store in the US
as well as distribution in seven foreign countries. Mr. Hunter is also an owner and serves on the board of
directors of a waste management enterprise in Sonoma County, CA with over $100M in sales. In 2008, Mr.
Hunter founded the Global Legacy Foundation, dedicated to addressing challenges related to climate change.
Ygrene Energy Fund furthers his Global Legacy goals by providing innovative financial solutions to the adoption
and implementation of PACE. Mr. Hunter provides the financial expertise and innovation to design and
implement programs employed by and unique to Ygrene Energy Fund.
Alan Strachan, VP, Government Liaison
900 College Avenue, Santa Rosa, CA 95405
E E >, r F, o alan @ygrene- energy.com
t: 707 332 4456 f: 707 579 4617
Alan Strachan is a co- founder of Ygrene Energy Fund and has over 35 years of experience at the intersection
of market forces and government policy. Dedicated to the notion that green energy and retrofit projects mean
job creation and GDP growth, Mr. Strachan built the financial transaction platform that streamlines the PACE
process for all participants. With 3 technology patents in his name and 20 years of experience designing,
developing and managing large, mixed -use developments in Northern California, Mr. Strachan combines the
creativity and innovation of the inventor with strategic and business development abilities in leading the
implementation of Ygrene Energy Fund's program to strengthen municipal economies while reducing their
carbon footprints. Alan received his Bachelor's degree from the University of Southern California in 1969, and
his Master's degree from Sonoma State University in 1971. He has been an expert consultant to the
Department of Defense, a member of the White House Staff, founding director of the non - profit human
services organization, Social Advocates for Youth, Inc., inventor of a successful consumer product, and CEO of
a technology start-up.
Company Confidential 900 College Ave_ Santa Rosa, CA 95404
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U N D C01HP.t COLInty RFI 'l1 5716
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Dan Schaefer, President (Designated Contact)
.�rnene 900 College Avenue, Santa Rosa, CA 95405
V k M k A G T F U M O dan @ygrene- energy.com
t: 707 2916791 f: 707 579 4617
' Dan is a serial entrepreneur. Over the course of his career he has been involved with a dozen companies in
start-up through the execution phase. In high school Dan established and later sold a maintenance
' engineering (janitorial) business and used the proceeds to pay for college. Dan received his BS in Computer
Science from University of California, Santa Barbara (UCSB) in 1989. During his time at UCSB Dan managed the
on campus computer lab and taught computer classes to local professionals during the evenings and
weekends. In his senior year Dan and three classmates founded MTEC a computer consulting and training
company in Camarillo, Ca. with a contract from UCSB to offer their programs in the METC facilities. Within the
' first twelve months of operation Dan, as President of METC, won the contract to convert Navy personnel from
PC to Macintosh computing and was approached by J. Fernando Niebla, Chairman /CEO, of Infotec
Development, Inc. a $200M computer systems integration company to purchase METC. Dan and his partners
' sold METC in 1990 and established a new division of Infotec: Infotec Commercial Systems, with an immediate
plan to expand throughout the Western United States. By 1995 the Commercial Systems division had grown
to sixteen offices in the Western US and in 1995 Fernando and Dan completed a management buyout of the
Commercial Systems Division and formed a separate company: Infotec Commercial Systems, Inc. Over the
next five years the company expanded rapidly across the United States. Dan spearheaded a series of
acquisitions and expansion to key cities throughout the US, and by 1999 the company was operating in 52
offices and employed 1,200 people, with revenues in excess of $100M. In 1999 the company had three
primary operations: Education Centers, University Alliances and Consulting which were merged and acquired
' from 1999 to 2001.
Following,the sale of the Education Centers business unit, Dan and his wife Gloria relocated to Sonoma County
and expanded his family's wine grape vineyard interests. The vineyard, named Mountain Terraces Vineyard, is
one of the most spectacular in Sonoma County, perched 1800 feet above Sonoma Valley with views to San
Francisco; it produces ultra - premium fruit which enabled Dan to start and develop a winery venture, Audelssa
' Estate Winery. Finally, Dan and partner Terry Grimm, former owner /developer of the Kenwood Inn and Spa,
www.kenwoodinn.com, have established a fractional interest company (Vineyard 27 Partners) for wine
country lovers who desire to explore winemaking and the special lifestyle opportunity that exists in Sonoma,
' CA.
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Company Confidential 900 College_ Ave. Santa Rosa, CA 95,401
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E N E R G Y F U N D Collier Count y RFI 11-5716
Management - Partners
' Robert Hynote, Managing Director
BARCLAYS 555 California Street, 30`h Floor, San Francisco, CA 94104
' CAPITAL robert.hynote @barcap.com
t: 415 274 5363 f: 415 274 5000
' Robert Hynote, Managing Director, joined Lehman Brothers in 1999 from another major investment bank and
transitioned to Barclays Capital on September 22, 2008. Prior to that, he worked in investment and
commercial banking for 14 years. He has been a senior banker for both taxable and tax - exempt housing
financing totaling over $13 billion, and he has been the senior investment banker for a number of state
housing agencies, including those of Alabama, California, Colorado, Georgia, Idaho, Mississippi, Montana,
' Nevada and Utah, and for the Oregon Department of Veterans Affairs. Mr. Hynote has been instrumental in
many innovations in mortgage revenue bond structures, investment programs and mortgage programs. He
has been responsible for structuring the first unsubsidized standalone single family issues for state housing
' agencies after passage of the Mortgage Subsidy Bond Tax Act and the origination of multiple lien mortgage
bonds, current refunding mortgage bonds, taxable /tax- exempt mortgage bonds, variable rate mortgage bonds
and the first -come, first- served lending programs now used by many housing issuers. Most recently, Mr.
Hynote has been responsible for creating structuring for issues with variable rate debt and synthetic fixed rate
debt for state housing agencies in Idaho, Utah, California, and Colorado and developing the multi -lien
structure used for military housing. Mr. Hynote received a B.S. and an M.B.A. from Georgia State University.
BARCLAYS Christopher Moriarty, Director
' CAP) FAL 200 Park Avenue, New York, NY 10166
christopher.moriarty@barcap.com
Christopher Moriarty, ' t: 212 526 7896 f: 212 412 7300
p Director (New York), joined
Lehman Brothers in July 1998 and transitioned to Barclays Capital on September 22, 2008. Previously he spent
10 years with Standard & Poor's in the Public Finance Department Tax Exempt Housing Group where he
supervised bond ratings for all types of affordable housing financings including single - family and multi - family
transactions. While at S &P, Mr. Moriarty served as the primary rating analyst for $7 billion in military housing
ratings and has written extensively on the subject including authoring the first military housing bond rating
criteria. While at S &P he also served as the primary analyst for the Florida, Texas and Tennessee housing
finance agencies and the Florida Affordable Housing Guaranty Fund. Prior to S &P, Mr. Moriarty worked in the
' real estate finance industry including at PaineWebber and Pearce, Mayer & Greer. He started his business
career at Arthur Andersen in 1979. Mr. Moriarty also spent six years on active duty in the Navy and 24 years
' in the Naval Reserve retiring as a Captain. He has C.P.A. and real estate broker's licenses from NY State, and
has served as a backup analyst for Connecticut Housing. Mr. Moriarty has a B.A. from Columbia College and
an M.B.A. from the Columbia Graduate School of Business.
Company Confidential 900 Collegc_ ,Ave. Santa Ro>a, CA 95,104 8
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��aarene . _; .�
YE N E R c r f U N D Collier County RP-1 111-S716
John Wakefield, President & Chief Operating Officer
` >O_iI, UTTIO'' Q S 400 North Tampa Street, Suite 2200 Tampa, FL 33602
John.wakefield @lykes.com
t: 813 470 5034 f: 813 470 5007
John Wakefield's professional experience spans over 13 years of service in corporate and investment banking,
wealth and investment management and strategic corporate development. In 2007, Mr. Wakefield joined the
Lykes Bros: executive management team and was responsible for strategic corporate growth and business
development initiatives. As a result of this strategic work, Mr. Wakefield planned, organized and launched
EcoAsset Solutions for Lykes Bros.
Currently, he is the President and Chief Operating Officer of EcoAsset Solutions and responsible for the
' division's strategic growth and operating performance. Prior to beginning his work at Lykes Bros., Mr.
Wakefield spent nine years working in various capacities of the financial services industry. Initially, he worked
for Wachovia Bank in Atlanta, GA in the bank's large corporate finance group. In this role, Mr. Wakefield
concentrated on credit structure and analysis as well as capital markets solutions and advisory for clients
located in the Southeast.
Following this role, Mr. Wakefield joined a newly formed Media and Telecommunications corporate and
investment banking group at Wachovia. In this capacity, Mr. Wakefield was responsible for managing the due
diligence and underwriting process related to capital structure advisory and solutions that his clients used for
corporate development, management buyouts, mergers and acquisitions. In 2001, Mr. Wakefield relocated to
Tampa to join Wachovia's regional corporate banking group and subsequently, moved to SunTrust Bank where
he worked in the Commercial Banking and Wealth and Investment Management lines of business.
Mr. Wakefield holds an International MBA from Thunderbird - American Graduate School of International
Management (Phoenix, AZ) and a B. A. (English) from the College of Charleston.
' Lee R Evett, Vice President
.WWILLDAN 7380 Sand Lake Rd, Suite 500, Orlando, FL 32819
' FinancialSerocea levett @willdan.com
t: 407 352 3958 f: 888 326 6864
' Lee Evett is the Vice President of Willdan Financial for Southeast Operations and is responsible for clients
throughout the southeastern United States involved in every aspect of Wilidan services. He has conducted
analyses of numerous city and county projects involving financial analysis, assessment and district
administration and management consultations in Florida, Missouri, Georgia and North Carolina.
With expertise in multiple areas, such as Fiscal Analysis for Assessments, User Fees and Rates, Impact Fee
' Studies and Utility Rate Studies, Mr. Evett came to Willdan with over 34 years of experience as a City Manager
with experience in seven cities located in five states.. He holds a Masters of Public Administration from Indiana
University and a B.A., in American Government and Politics from Purdue University. Mr. Evett is a member of
the International City Managers Association, the Government Finance Officers Association, the Florida,
California, Missouri, Pennsylvania and Colorado state city management associations and the Florida Finance
Officers Association.
Company Confidential 900 College Ave. Santa Rosa, CA 16404 9
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3/13/2012 Item 5.13.
Collier County RFI 11.5716
Ygrene Energy Fund: In the Spring of 2006, Dennis Hunter and Alan Strachan formed a partnership to bring
market forces to bear on the problem of climate change. With his background as a founder and Chairman of
Sonoma National Bank (see Exhibit A), Ygrene Chairman Dennis Hunter arranged and co- founded a four -bank
lending system called Green Energy Loan (GEL) for the purpose of facilitating loans that would enable
homeowners to cost effectively retrofit their homes to reduce carbon emissions. This project led, in part, to
the inception of Sonoma County's PACE Program. In response to the success of the Sonoma County PACE
program, Hunter realized the need for a more efficient administrative and financial model. GEL quickly added
software development personnel, began work on the web tools needed to underpin a fully scaled -up PACE
program and added Duane Hartley, Bart Van Voorhis and Dan Schaefer to the management team. Dan's
primary function was to propagate the business throughout the country. Dan immediately focused on
software development and refinement of the business model to insure adequate capacity for launch in
multiple markets. Dan also drove analysis of the company's branding and marketing plans, resulting in the
adoption of Ygrene Energy Fund as the company name to take to the market. In the summer and fall of 2010,
Ygrene entered into discussions with Robert Hynote and Christopher Moriarty at Barclays Capital, to secure
the strong financial partner that would provide the backbone for the business. With the addition of Barclays,
Willdan Financial, US BCSD, and the Carbon Trust, Ygrene is now in a position to offer turnkey PACE set -up,
administration and financing throughout the country.
Barclays Capital: Barclays Capital is an investment bank wholly -owned by Barclays Bank, engaging in
' securities underwriting, dealing and market - making activities. Barclays Capital is a registered securities
broker - dealer and a member of FINRA and SIPC, and has its global headquarters in New York. In addition to
municipal finance, its activities include transactions in asset - backed securities, international and domestic debt
' and equity securities, other corporate - related securities, mergers and acquisitions, and securities lending.
Barclays Capital is also a primary dealer in U.S. government securities.
FI
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Barclays' global capabilities are demonstrated by its leadership in debt underwriting. As of year -end 2010, the
firm ranked #1 in Global debt underwriting and #2 in US debt underwriting, according to Bloomberg. These
rankings continue the firm's strong performance in 2009, when Barclays Capital finished as the leading
underwriter of debt worldwide with over $339 billion par. Barclays Capital's Municipal Products Division
combines investment banking, underwriting, sales and trading, derivatives and reinvestment products into
one unit, employing 175 municipal professionals as of December 31, 2010. Barclays' Public Finance
Department provides investment banking services to government clients nationwide, comprising 92 bankers
organized into specialty groups (education, healthcare, housing, project finance, transportation, and utilities)
and regional teams (with offices in Atlanta, Boston, Chicago, Houston, Los Angeles, San Francisco, San Juan,
Seattle, and Washington, DC). The Municipal Underwriting, Sales, Trading, Derivatives and Research desks
employ 83 professionals. For a comprehensive description of Barclays' experience in the Midwest, see Exhibit
C: Barclays Experience.
' Company Confidential 900 College Ave. Santa Rosa, CA 95 <104
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(91 �rene _ E N E R G Y Y FUND Collier County RFI 11 -571()
' Lockheed Martin: Currently, we are providing energy engineering, technical support and program
management services for government and utilities, such as Pacific Gas & Electric, Southern California Edison,
Energy Trust of Oregon, Ameren, Pepco Delmarva Power, Consolidated Edison of New York, National Grid,
' NSTAR, and Cascade Natural Gas. LM has installed over 1,200 GWh of annual energy savings for C &I customers
and over 500 GWh for residential and multi - family customers.
' Lockheed Martin operates in all 50 states and 75 countries at more than 1,000 facilities. We bring
management expertise applied in a synergistic way to address complex technical and business challenges, and
offer the skill and talent of our 126,000 employees, more than half of whom are engineers or scientists. LM
' places significant emphasis on partnering with our customers, implementing best practices and achieving
outcomes in support of customer objectives.
Lockheed Martin offers a customer - focused solution that combines proven energy engineering expertise to
drive comprehensive and deep penetration of energy savings projects with an understanding of the key
decision factors impacting a customer's decision to engage and complete the energy efficiency project. This
' approach, combined with our proven processes, procedures, technology, and experienced personnel, will
ensure that Chicago's businesses and industries receive professional level service tailored to their unique
requirements along with the necessary hand holding to complete the efficiency projects. See Exhibit D:
' Lockheed Martin Experience.
rEcoAsset Solutions: EcoAsset Solutions is a Tampa, Florida based company and a wholly —owned subsidiary of
Lykes Bros. Inc., a 5ch generation Florida family owned company with over one hundred years of experience
' and financial stability in managing a diverse set of businesses ranging from large scale natural resources and
agricultural commodities to financial services. EcoAsset Solutions is an award winning provider of
Sustainability Management Services for the public and private sector. The company's mission is to maximize
' organizational performance by providing solutions that prove the value of sustainability. Clients integrate
EcoAsset Solutions' Sustainability Management teams as a partner to provide comprehensive sustainability
plans, ongoing leadership, customer service and mission critical performance tracking of sustainability
' investments. The aim of the company is to be a trusted strategic service partner for organizations that are
trying to design, implement and drive a sustainability agenda that improves competitiveness, grows revenue,
and eliminates resource waste to improve profit margins.
' EcoAsset Solutions has assisted many Florida local governments on energy efficiency and conservation
projects. Highlights include:
' Pinellas County: EcoAsset Solutions developed an Energy and Conservation Strategy for Pinellas County
(Population: 910,260) that was awarded $3,791,300 by the Department of Energy (DOE) to fund eight diverse
activity projects. In 2010, the projects resulted in actual community -wide annual energy savings of 1,384
megawatt hours, greenhouse gas reduction of 1,986 metric tons of carbon dioxide equivalents (CO2e) and cost
savings of $148,900. These numbers are expected to increase significantly in 2011 and 2012 with the
construction of a district cooling plant and various multi - family apartment energy retrofit projects. Our
project team continues to support Pinellas County by leading the project performance reporting (i.e., PAGE
reporting) required by DOE through the end of the grant period in 2012.
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E N E R G Y F U N D Collier County RR 11 -5716 Aft
City of Clearwater: EcoAsset Solutions conducted acommunity -wide greenhouse gas inventory and
' developed a customized greenhouse gas calculator tool for the City of Clearwater (Population,
110,169). Additionally, the project team was responsible for engaging and educating city employees
and citizens through meetings and interactive open houses and drafting a community -wide action
' plan with energy and greenhouse gas reduction strategies across eight topic areas.
City of South Daytona: EcoAsset Solutions is partnering with City of South Daytona (Population, 13,177)to
' develop a Sustainability Management System that includes baseline sustainability data collection, stakeholder
education and engagement, a Sustainability Action Plan, and the development of a sustainability indicator
tracking tool that will prepare the city to track and monitoring the results of its plan.
Wilidan: Serving more than 800 public agencies and private sector clients nationwide, Willdan provides
' engineering, energy efficiency, financial and organizational management, and financial consultant services
that ensure the quality, value, and security of our nation's infrastructure, systems, facilities, and environment.
' The firm has been a consistent industry leader in providing every aspect of municipal and infrastructure
financial services, engineering, public works contracting, planning, building and safety, construction
management, and homeland security solutions, plus energy efficiency and sustainability services.
Founded in 1964, Willdan was established as a civil engineering firm specializing in providing solutions for
public agency clients. Since that time, the company has evolved into a professional consulting firm offering a
' broad array of services that allow it to provide a comprehensive and integrated approach to its clients'
planning, engineering, financial, economic, public facility, energy, and public safety needs.
Willdan is a recognized leader in providing consulting services to local governments for more than 45 years.
' Building on our civil engineering base, Wilidan expanded the services it provides local governments to include
the creation of financial mechanisms for cities as well as the objective energy consulting needed to
understand energy efficiency upgrades, demand response and renewable energy. This multi - disciplinary skill
' set, along with our focus on quality control and policy development sets us apart in the industry.
Willdan Financial Services is a national recognized leader in District Administration Services. Willdan's role in
' this assignment will be District Administration Services. Specifically, Willdan will manage long -term collection
of bonded pay -as- you -go special taxes, assessments and fees. Wilidan currently administers over half a billion
dollars worth of assessment and special taxes for more than one hundred and fifty local governments. Willdan
' Financial is a leader in administering and maintaining assessment rolls.
Also available to this engagement is Willdan Energy Solutions (WES). WES is one of the nation's preeminent
' energy efficiency and sustainability consultants with more than 20 years experience in the energy,
sustainability, and IT fields. As a result of our program management, marketing, administration, reporting and
engineering expertise, we have:
' • Saved over 160 million kWh in EE retrofit projects across our various energy efficiency programs
nationwide
• Currently running over $45 million in EE programs in California alone
' • Developed and refined IT systems and applications that currently manage over $2 billion in energy
efficiency programs
Company Confidential 900 Calleve Ave. Santa Rosa; CA 95,101 12
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3/13/2012 Item 5.13.
Collier County RFI 11. -5716
Our approach to advising local governments on climate change and sustainability issues has focused on
developing a strong understanding of the city's general plan objectives, its constituency, the city's current
needs /issues and the State's current requirements. Our focus always centers on how energy efficiency can
provide real -world solutions to sustainability. We are proud of the results that cities have realized:
• Willdan Energy successfully helped cities write an Energy Conversation Strategy to obtain their
Energy Efficiency Conservation Block Grants (EECBG) grants. All were approved within three
months -- the fastest turnaround among eligible cities. Cities included: Lakewood ($695,200),
South Gate ($882,100), La Habra ($528,500), Arcadia ($534,700), La Puente ($166,800), Bellflower
($654,000), Pico Rivera ($579,400), Carson ($929,900).
' • Willdan Energy helped several cities develop a comprehensive Strategic Plan response to SCE's
Strategic Plan RFP. Cities included: South Gate, El Segundo, Simi Valley, County of Santa Barbara,
City of San Bernardino, and the Coachella Valley Council Association of Governments. Awards
' equaled $8,286,844.
• Our understanding of local governments and greenhouse gas emission reductions led to a project
' with the Gateway Cities Council of Government. Willdan Energy was chosen as the COG'S
consultant to identify next steps in response to SB 375. We are currently helping the COG develop
a Sustainable Communities Strategy.
• PG &E San Joaquin County: We identified energy efficiency opportunities that will save the County
a total of $230,000 net in less than 1 year, with an additional savings of $160,000 in less than 3
C years. In total, by implementing the 3 -year or less ROI measures, the County stands to save up to
$850,000 in utility bills over the course of 3 years.
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3/13/2012 Item 5.B.
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E N E R G Y F V N D Co lie. County linty RFI 11-5716
OVERVIEW AND APPROACH
Ygrene's comprehensive approach is designed to incorporate all the necessary resources to implement a
successful PACE program. Ygrene provides cities and counties with a complete "PACE -in -a -Box" program
package and full implementation, including:
I. PROGRAM DESIGN: The Ygrene team has intimate knowledge of PACE programs and PACE laws
throughout the country. In Florida, we have worked with qualified legal counsel who are experts in
public finance, and are very familiar with Collier County. They are prepared to assist with all of the
legal documentation necessary for program design and implementation and may be brought in to
assist as needed.
II. FINANCIAL MODEL: Ygrene has created a financial structure that involves no cost or funding
requirements to the jurisdiction and no exposure to the local government's general fund.
III. ADMINISTRATION: Ygrene's administrative approach effectively manages all aspects of a PACE
program. Through its Energy Centers, Outreach Offices and custom Enterprise PACE Management
WebTool, Ygrene streamlines project management, document management, and contractor
management, requiring minimal resources from the local government. Ygrene's administrative
function accounts for all financial transactions, underwriting, project documentation, contractor
training and oversight, government staff liaison, face -to -face customer service and assessment
management.
IV. CONTRACTOR CERTIFICATION & TRAINING: To participate in a city or county's PACE program,
contractors are required to meet national and state recognized standards for energy efficiency and
renewable energy work. Contractors will also be trained to use Ygrene's Enterprise PACE Management
WebTool and partner energy audit tools.
V. MARKETING & OUTREACH: Ygrene has developed a comprehensive and locally tailored marketing
plan designed to maximize public engagement and participation in PACE programs. Ygrene's
marketing approach implements population based Ygrene Energy Centers and Outreach Offices,
locally customized website and social networking solutions, property segmentation analysis and
targeting, end -user marketing materials and contractor training and professional marketing courses. In
addition, Ygrene has developed a "STATEPACE.ORG" web platform designed to utilize social
networking sites, webinars, and locally customized web sites to maximize PACE education, outreach
and community participation.
Ygrene's approach is structured on a local level to empower cities and counties to implement sound PACE
financing solutions to create jobs, improve local economies and lower carbon emissions at no cost to the local
government. The following overview and approach section details the methodologies and parties involved in
implementing and scaling up a successful PACE program.
Company Confidential Wo College Ave. Santa Rosa; CA 95404 14
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Packet Page -61-
�� 3/13/2012 Item 5.13.
� t rene E N E R G Y FUND Collier County RFI 11-5716
PROGRAM DESIGN
' When setting up a new PACE program for a contracting municipality, Ygrene provides coordination with
jurisdiction representatives, all staffing, legal review including enabling ordinances and PACE reports, and full
review of standards for contractors, applicants, underwriting, fee structures, assessments, liens and tax
assessment management.
' Ygrene has established a scalable systematic approach for designing, launching and administering a PACE
program. A Document Management System that identifies all documents necessary to establish and launch a
PACE program is accessible to all parties required to work through the design and launch process.
' Sample PACE Document Management System
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www verenc� enerL3v.com
Packet Page -62-
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Packet Page -62-
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(grene 3/13/2012 Item S.B.
E N E R G r f u N o Collier COUnt. y RFI 11 -5716
FINANCIAL MODEL
' Ygrene provides all start-up costs, interim warehouse financing for the contracted municipality, a permanent
funding source, lender liaison and financial reporting services. In order to do so, Ygrene has partnered with
' Barclays Capital to provide both aggregation and post -PACE assessment funds. The local PACE program will
disburse the funds to eligible property owners and contractors to fund PACE improvements, in accordance
with municipal resolutions. Funds are repaid pursuant to voluntary assessment contracts between the
property owners and the program jurisdiction. Contractual assessment instalments are collected through the
property assessment mechanism in the County property tax system.
Ygrene, along with its financing partners, offers a very attractive product for the financing of energy efficiency
retrofit projects. There is a strong incentive to property owners in that there is no up -front cost, a low interest
rate, extended repayment terms of up to 20 years and projects can, in many cases, be cash -flow positive in
' year 1. These terms are highly competitive when compared to alternative financing vehicles such as lease buy-
backs, unsecured loans, corporate debt and even most government sponsored energy programs. Additionally,
' by providing both interim and long -term financing, Ygrene offers a sustainable and perpetual funding
mechanism for energy efficiency retrofit projects in the Collier County market.
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PACE Program Financing Model
Aggregation Period: As projects are completed and funded under the program, each assessment is aggregated
into a group.
Long Term Financing: In order to provide continuous availability of the aggregation funds, groups of
assessments are issued as bonds.
Short-term Lone -term Financine via Bond
PACE District Financine Market
1.0irene
Company Confidential 900 College Ave. Santa Rosa, CA 95404 16
www.verene eneray.co )
Packet Page -63-
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YENERGY FUND
Proposed Structure and Terms of Loans:
3/13/2012 Item 5.B.
Collier Coontv RFI 11 -5716
The Ygrene program provides fixed -rate financing to property owners. The rate is set at the time the
assessment is placed on the property tax rolls. Financing is secured by voluntary non -ad valorem property tax
assessments that are collected by the local tax assessor. Funds in amounts up to 20% of the assessed valuation
of qualifying improved property will be provided for renewable energy and energy efficiency projects on the
assessed property. The debt will be amortized over the effective life of the installed improvements and can be
repaid at any time without penalty.
Type and Amount of Leveraged Capital:
Ygrene has entered into a financing agreement with Barclays Capital under which Barclays has agreed to
provide interim (warehouse) financing and long -term (bond) financing for Ygrene administered contractual,
non -ad valorem, assessment financing programs. This agreement provides a level of on -going funding
sufficient to respond to virtually any level of demand. The Ygrene program is (i) fully scalable; (ii) allows time
for adequate aggregation to satisfy bond market volume; and (iii) provides a vehicle for assessment diversity
to insure high bond ratings.
Minimum /Maximum Loan Sizes:
The minimum assessment under the program is $2,500. There is no maximum project cost other than the
program funding limit of 20% of assessed valuation.
Anticipated Number of Loans:
Until in -depth property research and segmentation is conducted it is difficult to estimate the number of
anticipated loans in a given city, however determining factors include: number of single- and multi - family
residential housing units, number and type of commercial and industrial properties, and the amount of
occupied square footage.
An estimate, based on data from Sonoma County (the largest and longest running PACE program in the U.S.),
is that there's a maximum potential market in Collier of approximately 80,000 single - family residential units
with total energy efficiency & renewable energy projects valued at up to $2.2 billion.
For commercial projects, assuming there is 72 million square feet of occupied, private building space the
market potential is greater than $400 million. (Neither the residential or commercial estimates include
additional economic output related to project values).
' The total combined market potential for residential, commercial and industrial is likely to be on the order of
90,000 — 100,000 projects. Ygrene anticipates approximately a 1.5% market penetration per year and based on
these very rough estimates that would equate approximately 1,500 projects annually.
I
Company Confidential 900 College Ave. Santa Rosa, CA 95407 17
www.verene- enerev.com
Packet Page -64-
(grene 3/13/2012 Item 5.B.
U N D Collier County RR 11 -5716
Expected Tenors and Terms:
Tenors are up to 20 years, depending upon the effective performance life of the installed improvements.
Interest rates on all assessments are fixed for the life of the financing at the time the assessment is placed on
' the property tax rolls. Financing is fully amortized over its term with payments collected in concert with ad
valorem property taxes and other assessments — usually March 1 or June 1 and August 1 or September 1.
IInterest Rate:
Ygrene anticipates an initial retail rate (the rate charged to property owners for assessment financing of
' renewable energy and energy efficiency improvements on their property) of 7.00 %. From this retail rate,
Ygrene Funding (Ygrene's financing arm) allocates 6.50% for program costs including, but not limited to, bond
' interest, bond costs, warehousing expenses, derivative and insurance costs, legal fees, bond rating services,
administration and management costs, financial oversight, organization, research and development,
marketing and related direct or indirect costs and expenses.
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The balance, up to 50 basis points, provides for administration and program operations in contracting
jurisdictions. For the PACE Program, Ygrene will utilize these funds for program administration, marketing and
program development, legal and bond counsel, jurisdiction cost reimbursement, overhead and profit.
Market forces may cause the PACE Program rate to change. The 7.00% rate is based, in part, upon the U.S.
Treasury 10 -year bond rate (3.62 %). If the rate for on- the -run U.S. Treasury 10 -year bonds increases, the
6.50% Ygrene Funding program cost allocation will change in direct relationship to the increased bond rate.
This would result in reduced funding for program operations if the retail rate remained at 7.00 %.
Another market force driving the Program interest rate is bond rating. The 6.50% Ygrene Funding allocation
presumes AAA ratings and a 10 -year bond rate for the program bonds. Lower ratings or increased terms could
result in higher bond and other costs. This would precipitate an increase in the 6.50% Ygrene Funding
allocation and a reduced program operations allocation.
Either of these market conditions would put pressure on the 7.00% retail interest rate and require higher rates
for the assessment financing.
Company Confidential 900 College Ave. Santa Rosa, CA 95404
www varene-enPrev.Com
Packet Page -65-
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(grene 3/13/2012 Item 5. B.
E N E R 6 T F U N D Collier County RFI 11 -5716
ADMINISTRATION
Program administration involves application processing and customer service, underwriting and project
approval, assessment processing and approval, project monitoring and funding approval, lender liaison and
tax roll management, and all reporting and audit supervision.
The jurisdiction Executive Officer (or his designee) empowers Ygrene as the Third Party Administrator and
authorizes Ygrene to enter into contractual assessments on behalf of the jurisdiction. During the program
design phase, each municipality will establish parameters on the size of contractual assessments that must be
separately approved by the jurisdiction governing body. The Program Administrator oversees professionals
associated with program implementation, including contractors and all other organizations assisting in the
administration of the program. Other duties and responsibilities assigned to the Program Administrator
include:
• Community outreach
• Responding to property owners' inquiries
• Processing applications
• Project oversight
• Contractor certification
• Managing and tracking funds disbursements
' Company Confidential 000 College Ave. Santa Rosa, CA 95404
www.verene enerev.wrn
Packet Page -66-
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3/13/2012 Item 5.13.
�
9 rene
E N E R G Y FUND Collier County RFI 11. 5716
Enterprise Management WebTool '
The Ygrene program is driven by advanced and full- featured enterprise management software available to
jurisdictions. It includes the ability to customize the web portal for each city and /or county and provides a
unique dashboard approach for the three primary users. Contractors and Administrators support the workflow
effort for each project from inception to completion. The dashboard approach helps streamline project
completion by driving each step of the process while offering real -time verification, document management,
project status and reporting features.
The 'Dashboard' provides a quick snapshot of activity in a district along with access to existing projects,
locations and administrative controls.
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Projects Overview
• Nea Projects: 10
• Total Projects 100
• Total FLrcira Allocated: S10,000,000
Lueate to new r- tuject
Property Breakdown
Funding Summary
Dan Schaefer
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Notifications
• 5 New Messages
• 8 New Requests
• 3 Pending Approvals
Recent Projects
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Company Confidential 900 College Ave. Santa Rosa; CA 95404 20
www serene- ene.ray.com
Packet Page -67-
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3/13/2012 Item 5.13.
9rene
1 E N E R G Y F U N D Collier County RFI 11 5716
Ygrene's WebTool enables management of all PACE projects - providing access and capability online 24/7 for
the ultimate convenience of contractors and project managers.
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Company Confidential
900 College Ave. Santa Rosa, CA 95,404
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Packet Page -68-
21
' fig'rene 3/13/2012 Item 5.B.
E H E R G Y F U N D Collier County RFI 11 -5716
CONTRACTOR CERTIFICATION AND TRAINING
' A strategic advantage of Ygrene's approach is Contractor Certification. As the Program Administrator, it is our
belief that success relies on competent, trained and certified installers and contractors. Ygrene will require
training on our proprietary web tool and authorized energy analysis and audit tools. We feel this approach
insures the best opportunity for high customer satisfaction and project success. As such, Ygrene is taking an
active role to identify, train and certify local contractors to ensure renewable energy and energy efficiency
standards are followed in every project. Ygrene has developed the right tools for contractors to market
themselves and drive projects in their communities.
' Commercial / Industrial Training Track
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' In order to become certified under the program, a contractor must have a state license in good standing.
Then, depending on the residential, commercial or industrial market they serve, all must attend training
courses and demonstrate competency in using the systems. Our Program Implementation Plan includes
' training in the areas outlined below:
• Ygrene WebTool
' Contractor Marketing Profile
■ Lead Generation
■ Proposal and Project Management
' Project Submission
■ Project Final and Funding
• Carbon Trust: Energy Analyzer (Commercial & Industrial Only)
• Database of 30,000 project outcomes
• Structure approach to developing a project plan
' Analysis of possible outcomes based on project plan
■ Heat Mapping
■ Hot Spotting
' Upon completion of the chosen certification track, i.e. residential, industrial, commercial or home energy
auditor, a contractor will be certified to participate in the program, listed on the customized jurisdiction
' website and included in all Ygrene promotional efforts.
Company Confidential 900 College Ave. Santa Rosa, CA 9.404 22
I vvww.vRrene- enerev corn
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ENERGY FUND
MARKETING AND OUTREACH
3/13/2012 Item 5.13.
Collier County RFl 11 -5716
Ygrene has developed an innovative five -point marketing approach that will be customized to each city or
county retrofit program. Ygrene provides a locally customized web portal, Ygrene staffed Energy Center
and /or Outreach Offices, local regional and editorial coverage, customized marketing materials and a wide
range of web -based seminars and community outreach and education opportunities. In addition, Ygrene
employs a unique web driven marketing approach utilizing the latest trends in social networking and data
gathering to develop an organized outreach effort for commercial and industrial property owners.
Upon entering a market, Ygrene acquires city and county property records for every property in the selected
jurisdiction. Ygrene uses the properties database to conduct a detailed market analysis drawing on massive
data collections from the Department of Energy and the Carbon Trust energy efficiency project database to
segment, prioritize and target highly qualified commercial and industrial retrofit projects. Utilizing Ygrene's
market analysis and property segmentation map Ygrene deploys various marketing campaigns, including direct
mail, email and social networking engagement avenues to recruit commercial and industrial property owners
to audit and retrofit their buildings.
Our focus on economic returns to the community from its property owners' sustainability investments makes
us unique. We make it a priority to look closely at jobs, ROI and cash flows generated by environmentally
responsible initiatives. Our attention to these measured results creates value for the local government, the
community at large and for other stakeholders in the success of our clients' projects. It is clear that
jurisdictions desire a firm that has proven excellence in participant feedback, which is a critical component of
measuring program success. All too often, programs are launched with no follow up plan to gauge cumulative
impacts. Using a life cycle assessment perspective, our cradle -to -grave approach to projects is a defining
characteristic.
Company Confidential 900 College Ave. Santa Rosa, CA 95404 23
' www.vf1rene enenzv.com
Packet Page -70-
(grene 3/13/2012 Item S.B.
N E R G r f U N 0 Collier Count y RFI 11 -5716
In essence, Ygrene provides a "program -in -a -box" to participating cities and counties through an efficient,
streamlined process offering continued program oversight and management.
Full Document and r Application and Program
Marketing Package = = Participation Forms located
at outreach Centers and
Energy Centers
or
' Contractor Certification
m and Training Programs
Qualitiying —
tmproveents Id
Definition Id
if — Enternprise Project
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Local Presence
' Customized Web
Portal
YGRENE
Company Confidential 900 College Ave Santa Rosa, CA 95404 24
www.vprene- ener�zv.com
Packet Page -71-
(grene 3/13/2012 Item 5. B.
E N E R 6 Y F U N D Collier County RFI 11 -5716
YGRENE ENERGY CENTERS
' Based on population, Ygrene will open Energy Center(s) to educate and assist property owners in
understanding the financial benefits of energy conservation, lifestyle enhancements and the value of energy
' efficiency /renewable energy improvements to their commercial, industrial or residential property. Ygrene
Energy Centers will provide face -to -face customer service, consumer education, and comprehensive
information on sustainability products and financing.
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Company Confidential 900 Colle °e Ave .Santa Rosa, CA 95,104 25
www.wrene enerRv.com
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3/13/2012 Item 5.13.
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E N E R G Y FUND Collier County RFI 11-S71.6
Aft
TECHNOLOGY SOLUTION
The Ygrene technology solution incorporates a number of strategies and technologies to effectively implement
and maintain Energy Efficiency programs. Ygrene has invested in a unique "statepace.org" platform allowing
cities and counties to adopt, customize and launch local programs quickly and easily. Ygrene's Energy
Efficiency Administration WebTool accounts for each party involved in the energy efficiency process and has
developed its own tools, or has incorporated third party tools, to manage a successful program.
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Company Confidential 900 College Ave. Santa Rosa, CA 95404 26
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Packet Page -73-
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LOCAL WORKFORCE
3/13/2012 Item 5.B.
Collier County RFI 11 -5716
As part of Ygrene's 'Contractor Certification and Training' program, upon creating the District the team will
identify all contractors licensed in the state of Florida and Collier County. To ensure the broadest possible
reach, Ygrene will conduct marketing and outreach activities targeted at the entire local workforce and
coordinate with local building trades unions to address opportunities for under and unemployed sections of
the workforce. The team will also rely on Lockheed Martin's experience managing energy efficiency projects
for utilities throughout the country, including working with numerous sub - contractors on large -scale projects.
By having a comprehensive action plan, experienced team members and a ramp -up period of several months,
Ygrene is confident that the program will rely heavily on the local Collier County area workforce and that this
constituency will benefit significantly in terms of job creation.
Company Confidential 900 College Ave. Sang Rasa, CA 95404
I www.vRtc'ii(,ei)etpv.com
Packet Page -74-
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tgrene 3/13/2012 Item 5. B.
N E R G Y F U N D Collier Count y RR 11 -5716
SCOPE OF WORK AND BUDGET (EXAMPLE)
' It is the understanding of the Ygrene team that the objective is to select a firm to administer and finance a
County- sponsored PACE Program. Specific goals include the reduction of GHG emissions, creation of local jobs
' and lowering the operating costs for commercial property owners. This section includes a detailed description
of the scope of services required to create, implement, finance and administer the county's PACE Program,
along with an estimated implementation timeline and budget.
IScope of Work
If selected by the city, Ygrene's approach will begin with the 'Scope of Services' document that forms the basis
of the contract between the County and Ygrene, and includes the following:
1. Objectives:
' a. Create a Collier County PACE District and a PACE Financing Program.
b. Provide for reliable and sustainable financing, administration and on -going support for the
County's PACE Financing Program.
2. Roles of the Parties:
' a. The County will act as the lead agency in creation of a PACE district, based upon enabling
legislation in effect in Florida (HB 7179).
b. The District will perform such steps as necessary to establish the PACE program within the District
' and validate the lien priority provided for in the program.
c. Ygrene will, without cost to the District, provide financing, program development, marketing,
contractor training/oversight and program administration for the PACE program.
3. Responsibilities of the District:
' a. Create the PACE District and act as the lead agency in the formation of its Governing Board.
b. Use its best efforts to bring into the PACE district any other jurisdictions wishing to join and who
are invited to do so.
' c. Provide staff liaison to Ygrene and use its best efforts to respond in a timely manner to Program
elements that require intervention or participation of the Program's governmental sponsor.
' 4. Responsibilities of Ygrene:
a. Provide Program design and development services to the District as detailed in the following
areas:
L Functions and Responsibilities for PACE
ii. Creation and Collection of Non -Ad Valorem PACE Assessments in Florida
' iii. District Program Timelines
iv. Eligible Improvements
v. Underwriting Terms
Company Confidential 900 College Ave. Santa Rosa, CA 95404 28
1 www.vRrene enerw.com
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ENERGY FUND
5. Term:
3/13/2012 Item 5.13.
Collier County RFI 11 -5716
The term of the Contract shall be five (5) years, which term shall be renewed after each five (5) year
period except in the event of early termination, which shall be at the county's option at the end of year
three (3) of each term.
Timeline (Concurrent)
' 90 -120 days 30 -60 days 30 days 60 days (+ on- going)
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Program Marketing & Contractor Financing & Support
Design Outreach Certification Admin
*Enabling
Ordinance
*Program Report
• Policy Statement
*Program Forms
• Presentation to
City Council
*Update and
Amendments
*Community
Outreach and
Participation Plan
• Property
Segmentation
• Website
Development
*Energy Centers
-Verification of
State Licensing
-Registration and
Authorization
• Program Training
and Certification
*Terms, Conditions
*On-going Website
and Applications
Management
*Qualifying Project
*Record of Notices
List
of Assessments
*Energy Savings
*Continuing
Calculation
Training and
*Utility Rebate
Support for
Processing
Contractors
*Assessment
*Property Owner
Processing
Support
*Staff Reports and
Coordination
See 'Appendix 5: Task List' for a complete list of program implementation activities.
IBudget
Ygrene estimates expenses of $300,000 for the completion the tasks outlined above and in 'Exhibit E: Task
' List'. Ygrene's proposal is zero cost to Collier County and that all costs associated with the district formation,
bond validation, program design, financial model implementation and all other activities described in this
' proposal will be borne by Ygrene. Furthermore, while Ygrene is seeking to form a long -term public - private
partnership with Collier County, these district and program features will remain valid even if the county
terminates the contract at a date in the future and selects another third -party PACE administrator.
61
Company Confidential 900 College Ave. Santa Rosa, CA 95404 29
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VENERGT FUND
Table 1: Budget Overview — Program Setup and Contract Term
3/13/2012 Item 5.13.
Collier Countv RR 11 -571.6
Description
Ygrene Energy Fund
Collier County
District Formation & Bond Validation
$80,000
$0
Program Setup
$220,000
$0
Program Marketing, Financing &
Administration
Variable*
$0
Total
$300,000
$0
*Ygrene's annual expenses associated with marketing, financing and administration of the Commercial PACE
Loan Program will funded from operations and will be based on market size and volume of financings. There is
no cost to the County for these services.
[A
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Company Confidential 900 College Ave. Santa Rosa, CA 95404 30
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ENERGY FUND
TERM OF COMMITMENT AND RENEWAL
3/13/2012 Item 5.13.
Collier County RF1 11 -S716
If selected to administer and finance Collier County's PACE Financing Program, Ygrene will immediately enter
into contract negotiations with the County with the goal of finalizing an agreement within 90 calendar days.
The proposed term of commitment for this contract is five (5) years which includes a 90 —180 day setup
period during which time the Ygrene team will perform and fund the district formation and bond validation
services, as well as invest in the initial marketing and outreach efforts. The five year term allows for adequate
time for Ygrene to recoup its upfront investment in forming the County's PACE program. It also allows for
enough time for the program to grow to the point in which the County realizes substantial benefits in energy
efficiency and renewable generation.
Ygrene further proposes a County -held option to cancel the contract which could be exercised by the end of
year three (3), with the provision that Ygrene is able to wind -down the program for the remaining two years of
the contract. Should the County decline this option, an automatic five (5) year renewal extension would be
exercised beginning at the end of year five of the original term. This process would be followed within each
five year term as long as the contract remains in- force.
It is Ygrene's intent to structure this agreement so that there is no cost to the County for forming the PACE
' district, to provide a superior financial product to property owners and to administer the program on a long-
term, sustainable basis. The proposed contract structure allows for Ygrene, its partners and the county to
Cachieve all of these goals.
I
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www.verene enemv.com
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STATEMENT ON THE POSITION OF FHFA, FANNIE MAE AND FREDDIE MAC
3/13/2012 Item 5.13.
Collier Cot.rnty RFI 11 -5716
In May, 2010 both Fannie Mae and Freddie Mac, two government sponsored enterprises that purchase the
majority of conforming *, single- family, residential* mortgages in the U.S., issued 'lender letters' that stated
that "the terms of the Fannie Mae /Freddie Mac Uniform Security Instruments prohibit loans* that have senior
lien status to a mortgage ". The FHFA followed up with its own 'statement' in June, 2010 that essentially
supported the Fannie Mae /Freddie Mac position.
Within a few weeks the following entities filed multiple lawsuits against the FHFA: the California State
Attorney General (now Governor Jerry Brown), Sonoma County (CA), Placer County (CA), the City of Palm
Desert (CA), the Sierra Club, the National Resource Defense Council (NRDC), the Town of Babylon (NY) and
Leon County (FL). Not long after, the active programs at the time, including SCEIP in Sonoma County and
PDEIP in Palm Desert, CA resumed assessments. And during the past twelve months since these letters were
issued, SCEIP alone issued more than $10 million in assessments. To the best of our knowledge no property
owners to -date have suffered adverse effects due to their participation in the program.
Since the FHFA, Fannie Mae and Freddie Mac letters were issued one year ago, programs in Los Angeles (CA),
Sacramento (CA), Ann Arbor (MI) and Cleveland (OH), among others, have either launched or announced the
intent to do so in 2011.
*Conforming loans represent one segment of the residential mortgage market; the others are conventional,
jumbo mortgages and also those homes with no mortgage at all- both of which are unaffected by these
entities.
*Residential — it is important to note that at no time was Commercial PACE threatened as neither of these
entities back commercial property mortgages.
*Loans — under most state's enabling legislation PACE programs issue non -ad valorem assessments, or liens,
not loans.
Company Confidential 900 College Ave. Santa Rosa, CA 95404
I www.vprene- energy corn
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ENERGY FUND
REFERENCES4VV.._____.___
Mr. Murat A. Armbruster
Special Advisor
Operation Lead, Green Capital Global Challenge
The Carbon War Room
543 Howard Street, 5th Floor
San Francisco, CA 94105
(415) 946 -3068
marmbruster @carbonwarroom.com
The Carbon War Room harnesses the power of entrepreneurs to implement market - driven solutions to
' climate change. The world needs entrepreneurial leadership to create a post- carbon economy. The War
Room's unique approach focuses on bringing together successful entrepreneurs, business leaders, policy
experts, researchers, and thought leaders to focus on market - driven solutions. Our approach is to identify the
' barriers that are preventing market -based scale up of climate change solutions and thereby perpetuating the
status quo. In addition to technology and policy gaps, these barriers include principal -agent problems,
information gaps, and lack of common standards or metrics.
1
Rod Dole
C Treasurer, Tax Collector, Auditor - Controller
County of Sonoma
' 585 Fiscal Drive, Room 100
Santa Rosa, CA 95403
707 -565 -2281
' rdole @sonoma- county.org
Mr. Dole is the elected Auditor - Controller- Treasurer -Tax Collector of Sonoma County. He is responsible for the
County's $1.5 billion dollar short term pooled portfolio and is a Trustee of the Sonoma County Employee
' Retirement Fund, which totals $1.4 billion.
' Ken is the financial adviser to many cities in California, and has been instrumental in the development of
energy efficiency retrofit financing for cities and counties.
Company Confidential 900 College Ave. Santa Rosa, CA 95404 33
I www.vur erie- erierpv.com
Packet Page -80-
Kenneth L. Dieker
'
Principal
Del Rio Advisors, LLC
'
1325 Country Club Drive
Modesto, CA 95356
(209) 543 -8704
(209) 554 -0427 Fax
'
(209) 480 -1862 Mobile
www.delrioadvisors.com
' Ken is the financial adviser to many cities in California, and has been instrumental in the development of
energy efficiency retrofit financing for cities and counties.
Company Confidential 900 College Ave. Santa Rosa, CA 95404 33
I www.vur erie- erierpv.com
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3/13/2012 Item 5.13
SONOMA BANK
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'Mr. Hunters' s Role:
From 1992 to 2007, at which time Mr. Hunter decided to sell Sonoma National Bank to Sterling Financial, Mr. Hunter
served as Chairman of the Holding Co. which owned the bank. Mr. Hunter served as a member of the Executive Loan
Committee reviewing over 30,000 loans and was the head of the Asset Liability Committee. As such he was responsible
for operations of the bank at all levels, development of new products and services, directing the bank's management,
financial profitability and survival plans. In addition, Compliance with legal and operational issues with the Securities
Iand Exchange Commission, the Office of the Controller of the Currency, the Federal Deposit Insurance, and the Internal
Revenue Service.
Case Study
Employees:
250
Status:
Sonoma National is a member of the Federal Reserve System and utilizes Fed Line services. The Bank's deposits are insured
by the Federal Deposit Insurance Corporation (FDIC), up to the maximum legal limits.
Summary:
Since 1985, Sonoma National Bank has developed a finely tuned specialty in real estate lending and SBA real estate
financing. Sonoma National Bank has been an integral part of the engine that drives regional business. The Bank offers
proven financial products and superior customer service to small and medium sized businesses, the real estate industry,
professionals and consumers. In addition, the Bank serves small business by maintaining five Small Business Administration
(SBA) loan production offices in Santa Rosa, San Rafael, Walnut Creek, Sacramento, California, and Phoenix, Arizona.
Most Pressing Need:
"Better utilization of customer relationship management technology and service related best practices and the support
systems to consistently produce excellent service."
Results:
The executive account managers annual training incorporated Total Integration and focused on key elements in the
customer service process where efficiencies of 50 -65% were achieved by reorganizing workflow and better understanding
current technologies to provide an integrated, standardized approach to SNB's key accounts.
Packet Page -81-
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3/13/2012 Item 5.13.
Company Release - 02/12/2007 18:00
SPOKANE, Wash. and SANTA ROSA, Calif., Feb. 12 /PRNewswire- FirstCall/ -- Sterling Financial Corporation (Nasdaq:
STSA) and Northern Empire Bancshares (Nasdaq: NREB) announced that they have received regulatory approval for
Sterling Financial Corporation's ( "Sterling ") acquisition of Northern Empire Bancshares ( "Northern Empire "). The
acquisition, which is anticipated to close on February 28, 2007, remains subject to the approval of shareholders of
Sterling and Northern Empire. The shareholders of Northern Empire and Sterling are scheduled to vote on the
transaction at special meetings to be held on February 20 and February 21, 2007, respectively.
Under the terms of the Agreement and Plan of Merger by and between Sterling and Northern Empire dated September
17, 2006, Northern Empire will merge with and into Sterling, with Sterling being the surviving entity in the merger. The
merger agreement also provides for the merger of Northern Empire's financial institution subsidiary Sonoma National
Bank, with and into Sterling's financial institution subsidiary Sterling Savings Bank, with Sterling Savings Bank being the
'surviving institution. Northern Empire shareholders are to receive 0.8050 shares of Sterling common stock and $2.71 in
cash for each Northern Empire share they own.
'Following completion of the transaction, Northern Empire shareholders will receive a letter with transmittal instructions
to assist in the process of exchanging their Northern Empire share.certificates for cash and Sterling share certificates.
Sterling anticipates that these documents will be mailed to Northern Empire shareholders in early to mid March 2007.
' Sterling Chairman and Chief Executive Officer, Harold B. Gilkey, commented, "This transaction extends Sterling Savings
Bank's footprint into northern California, and we will now serve customers in eight western states. We believe Sonoma
'brings expertise with small business administration lending and provides a platform for core deposit growth, as well as
expansion with commercial and consumer lending. We are very pleased to welcome the employees, customers and
shareholders of Northern Empire into our company."
Deborah A. Meekins, Northern Empire's president and chief executive officer commented, "The completion of this
transaction will bring many new opportunities for our customers, with new products, services and expanded technology
'in the markets we serve. Our cultures are very similar, and we are excited to implement Sterling's expertise to achieve
greater success in expanding the California market. We are proud to become a part of the Sterling family."
' ABOUT STERLING
Sterling Financial Corporation of Spokane, Washington, is a bank holding company of which the principal operating
'subsidiaries are Sterling Savings Bank and Golf Savings Bank. Sterling Savings Bank is a Washington State- chartered,
federally insured commercial bank, which opened in April 1983 as a stock savings and loan association. Sterling Savings
Bank, based in Spokane, Washington, has financial service centers throughout Washington, Oregon, Idaho and Montana.
'Through Sterling Savings Bank's wholly owned subsidiaries, Action Mortgage Company and INTERVEST- Mortgage
Investment Company, it operates loan production offices throughout the western region. Sterling Savings Bank's
subsidiary Harbor Financial Services provides non -bank investments, including mutual funds, variable annuities and tax-
'deferred annuities and other investment products through regional representatives throughout Sterling Savings Bank's
branch network.
Golf Savings Bank is a Washington State - chartered and FDIC insured savings bank. Golf Savings Bank's primary focus is
the origination of single - family residential mortgage loans.
' ABOUT NORTHERN EMPIRE BANCSHARES
Northern Empire Bancshares operates as the holding company for Sonoma National Bank, which provides commercial
banking services in northern California. The bank provides non - interest bearing demand, non - interest bearing savings,
interest bearing transaction accounts, time certificates, checking deposits, certificates of deposit and other time
certificates. Its loan portfolio comprises real estate mortgage loans, real estate construction loans, commercial loans,
' Packet Page -82-
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3/13/2012 Item 5.13
consumer installment loans and commercial loans guaranteed by the small business administration. As of December 31,
2006, the bank operated 12 banking offices in Sonoma, Marin and Contra Costa counties, California. The company was
incorporated in 1982 and is based in Santa Rosa, California.
ADDITIONAL INFORMATION ABOUT THE NORTHERN EMPIRE TRANSACTION AND WHERE TO FIND IT
On January 10, 2007, Sterling filed an amended registration statement on Form S -4 with the Securities and Exchange
Commission ( "SEC "), and on January 17, 2007, Sterling and Northern Empire mailed a proxy statement /prospectus to
their respective security holders containing information about the transaction. Investors and security holders of Sterling
and Northern Empire are urged to read the proxy statement /prospectus and other relevant materials as they become
available because they will contain important information about Sterling, Northern Empire and the proposed merger. In
addition to the registration statement filed by Sterling and the proxy statement /prospectus mailed to the security
holders of Sterling and Northern Empire, Sterling and Northern Empire file annual, quarterly and current reports, proxy
statements and other information with the SEC. Investors and security holders may obtain a free copy of the proxy
statement /prospectus and other relevant documents (when they become available) and any other documents filed with
the SEC at its website a www.sec. ov The documents filed by Sterling may also be obtained free of charge from Sterling
by requesting them in writing at Sterling Financial Corporation, 111 North Wall Street, Spokane, WA 99201, or by
telephone at (509) 227 -5389 begin _of the_skype_h igh lighting (509) 227 -5389 end_ of_ the_ skype_highlighting. In
addition, investors and security holders may access copies of the documents filed with the SEC by Sterling on its website
at www.sterlin financialcor oration -s okane.com The documents filed by Northern Empire may also be obtained by
requesting them in writing at Northern Empire Bancshares, 801 Fourth Street, Santa Rosa, CA 95404, or by telephone at
(707) 591 -9000 begin_of the_skype_highlighting (707) 591 -9000 end_of_the_skype_highlighting. In addition, investors
and security holders may access copies of the documents filed with the SEC by Northern Empire on its website at
www.snbank.com
Sterling, Northern Empire and their respective officers and directors may be deemed participants in the solicitation of
proxies from the security holders of Sterling and Northern Empire with respect to the transactions contemplated by the
proposed merger. Information regarding Sterling's officers and directors is included in Sterling's proxy statement for its
2006 annual meeting of shareholders filed with the SEC on March 24, 2006. Information regarding Northern Empire's
officers and directors is included in Northern Empire's proxy statement for its 2006 annual meeting of shareholders filed
with the SEC on April 13, 2006. A description of the interests of the directors and executive officers of Sterling and
Northern Empire in the merger is set forth in the proxy statement /prospectus mailed to security holders of Sterling and
Northern Empire on January 17, 2007, and will be set forth in other relevant documents to be filed with the SEC when
they become available.
FORWARD - LOOKING STATEMENTS
This press release contains forward- looking statements within the meaning of the Private Securities Litigation Reform
Act of 1995. These forward- looking statements include, but are not limited to, statements about: (i) the benefits of the
merger between Sterling and Northern Empire, including future financial and operating results, cost savings,
enhancements to revenue and accretion to reported earnings that may be realized from the merger; (ii) Sterling's and
Northern Empire's plans, objectives, expectations and intentions and other statements contained in this presentation
that are not historical facts; and (iii) other statements identified by words such as "expects," "anticipates," "intends,"
"plans," "believes," "seeks," "estimates," or words of similar meaning generally intended to identify forward- looking
statements. These forward- looking statements are based upon the current beliefs and expectations of the
managements of Sterling and Northern Empire, and are inherently subject to significant business, economic and
competitive uncertainties and contingencies, many of which are beyond management's control. In addition, these
forward- looking statements are subject to assumptions with respect to future business strategies and decisions that are
subject to change. Actual results may differ materially from the anticipated results discussed in these forward - looking
statements because of numerous possible uncertainties.
The following factors, among others, could cause actual results to differ materially from the anticipated results or other
expectations expressed in the forward- looking statements: (1) the businesses of Sterling and Northern Empire may not
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be combined successfully, or such combination may take longer, be more difficult, time - consuming or costly to
accomplish than expected; (2) the expected growth opportunities or cost savings from the merger may not be fully
realized or may take longer to realize than expected; (3) operating costs, customer losses and business disruption
Following the merger, including adverse effects on relationships with employees, may be greater than expected; (4) the
shareholders of Sterling and /or Northern Empire may fail to approve the merger; (5) adverse governmental or
regulatory policies may be enacted; (6) the interest rate environment may further compress margins and adversely
affect net interest income; (7) results may be adversely affected by continued diversification of assets and adverse
changes to credit quality; (8) competition from other financial services companies in Sterling's and Northern Empire's
markets could adversely affect operations; and (9) an economic slowdown could adversely affect credit quality and loan
originations. Additional factors, that could cause actual results to differ materially from those expressed in the forward -
looking statements are discussed in Sterling's and Northern Empire's reports (such as Annual Reports on Form 10 -K,
Quarterly Reports on Form 10 -Q and Current Reports on Form 8 -K) filed with the SEC and available on the SEC's website
a www.sec. ov The documents filed by Sterling, may also be obtained free of charge from Sterling by requesting them
in writing at Sterling Financial Corporation, 111 North Wall Street, Spokane, WA 99201, or by telephone at (509) 227-
5389 begin_of_the_skype_highlighting (509) 227 -5389 end _of the_skype_highlighting. In addition, investors and
security holders may access copies of the documents filed with the SEC by Sterling on its website at
[w:w::W:.sterlingfinancialcorporation-spokane.coMI The documents filed by Northern Empire may also be obtained by
requesting them in writing at Northern Empire Bancshares, 801 Fourth Street, Santa Rosa, CA 95404, or by telephone at
(707) 591 -9000 begin_of the_skype_highlighting (707) 591 -9000 end_of_the_skype highlighting. In addition, investors
and security holders may access copies of the documents filed with the SEC by Northern Empire on its website at
www.snbank.com
Sterling and Northern Empire caution that the foregoing list of factors is not exclusive. All subsequent written and oral
forward - looking statements concerning the proposed transaction or other matters attributable to Sterling or Northern
Empire or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements above.
Sterling and Northern Empire do not undertake any obligation to update any forward- looking statement to reflect
circumstances or events that occur after the date the forward - looking statements are made.
Sterling Contacts:
' Sterling Financial CorporationHarold B. Gilkey
Chairman and Chief Executive Officer
509 - 354 -8186 begin_of the_skype_highlighting
' Daniel G. Byrne
EVP, Chief Financial Officer
' 509 - 458 -3711 begin_of the_skype_highlighting
Media Contact:
Jennifer Lutz
Public Relations Specialist
509 - 458 -2711 begin_of the_skype_highlighting
' Contact:
Northern Empire BancsharesDeborah A. Meekins
' Chief Executive Officer
707 - 591 -9000 begin_of the_skype_highlighting
SOURCE Sterling Financial Corporation
509 - 354 -8186
509 - 458 -3711
509 - 458 -2711 Extension 6545
707 - 591 -9000
IPacket Page -84-
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3/13/2012 Item 5.13.
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' 3/13/2012 Item 5. B.
IMMSE!IMOR MANAGED ISSUANCE llllll
' We serve as senior manager for the following clients, listed with the tenure of this engagement:
C
We encourage you to contact any of our senior managed clients to inquire about the services we provide. We have
listed contact information for three sole senior managed clients:
' Please see below for information regarding Barclays's role, and, if applicable, number of firms in rotation, regarding
senior managed issuers:
'
Idaho HFA
23
Illinois HDA
1
Massachusetts HFA
17
Idaho HFA
Michigan State HDAJ
.n, 23 _
New JerseyHMFA .y
_
2 _
7
'.m
Ohio HFA
25
Rotating Senior Manager
Penns lvania HFA
2
Michigan State HDA
Utah Housing Corporation _
25
Virginia HDA
2
C
We encourage you to contact any of our senior managed clients to inquire about the services we provide. We have
listed contact information for three sole senior managed clients:
' Please see below for information regarding Barclays's role, and, if applicable, number of firms in rotation, regarding
senior managed issuers:
'
Role
Rotation in
Idaho HFA
Sole Senior Manager
N/A
Illinois HDA
- _ _. .,
Rotating Senior Manager
7
Massachusetts HFA
Rotating Senior Manager
4
Michigan State HDA
Sole Senior Manager (Single Family)
N/A
New Jersey HMFA
Rotating Senior Manager
3
'
Ohio HFA
Rotating Senior Manager
3
Pennsylvania HFA
Rotating Senior Manager
4
Utah Housing Corporation
Sole Senior Manager
N/A
Virginia HDA
Senior Manager
0
' We have underwritten as senior manager 30 issues totaling more than $2.348 billion since 2008.
Our team focuses on a small number of senior managed clients with whom we have been engaged without
interruption and in many cases exclusively for more than twenty years. The mutual loyalty and respect
inherent to these long - standing relationships underscore our unwavering focus on our clients' interests. With
our sole senior managed clients we have developed strategies to allow loan rates to fluctuate with conventional
k 1
Packet Page -88-
' 3/13/2012 Item 5.13
' rates while minimizing interest rate risk, to reduce the amount and average life of acquisition funds, to
leverage bonding authority with taxable debt as needed and to maximize spread income. Our sole - managed
clients have been consistently profitable and productive throughout many market environments, lending well
above the HFA per capita average.
We have co- managed 15 issues totaling over $1.463 billion since July 2008, providing the typical services as
' a syndicate member, including providing interest rate views, selling bonds, assuming liability and proposing
financing ideas away from ongoing transactions. We have recommended loan warehousing strategies,
interest rate mitigation products, loan pipeline management techniques and economic refundings to clients
' with whom we are engaged as co- manager.
u
OVERVIEW
Overview. Barclays Bank PLC (Barclays Bank) is a publicly traded, global financial services provider
engaged in retail and commercial banking, credit cards, investment banking, wealth management and
investment management services, with an extensive international presence in Europe, the United States,
Africa and Asia. Founded in 1690, Barclays Bank has over 300 years of history and expertise in banking.
Today, it operates in over 50 countries and employs 155,000 people. Barclays Bank's shares are traded on
the London Stock Exchange and its American Depository Receipts (ADRs) are traded on the NYSE with the
ticker of `BCS ".
Pertinent to ownership, Barclays Bank is the only global bank providing investment banking services to
municipal issuers that has not accepted any government bailout money from the U.S. Treasury Department,
Federal Reserve or any sovereign or central banks, including the U.K. Financial Services Authority. Few
firms in the current market have our financial strength and flexibility to deploy capital for clients. Our
financial stability is acknowledged both by the credit rating agencies and by the market. Barclays Bank's
credit ratings (Aa3 /AA - /AA -) are among the highest of those firms actively involved in municipal securities.
Packet Page -89-
FA
7
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Barclays 0
Nbrgan Stanley _ 10
Goldman Sachs _ 10
JP Morgan 25
Bank of America 45
atigroup 60
US$ 01 0 5 10 15 20 25 30 35 40 45 50 55 60
Source: Bloomberg, total assistance overcoorseolprapram.
3/13/2012 Item 5.13.
JPMorgan Chase
Aal /AA - /AA-
Bank of America
Aa3 /A + /A+
Citibank
Al /A + /A+
Morgan Stanley
Al /A + /A+
Goldman Sachs
Al /A /A+
Barclays Capital is an investment bank wholly -owned by Barclays Bank, engaging in securities underwriting,
dealing and market - making activities. Barclays Capital is a registered securities broker - dealer and a member
of FINRA and SIPC, and has its global headquarters in New York. In addition to municipal finance, our
activities include transactions in asset - backed securities, international and domestic debt and equity
securities, other corporate- related securities, mergers and acquisitions, and securities lending. Barclays
Capital is also a primary dealer in U.S. government securities. The chart below presents Barclays Bank's
major divisions including Barclays Capital:
Barclays' global capabilities are
demonstrated by our leadership in
debt underwriting. Year -to -date,
Barclays Capital ranks #1 in
global debt underwriting and #2 in
US debt underwriting, according
to Bloomberg. In 2009, Barclays
Capital was the leading
underwriter of debt worldwide
with over $339 billion par.
Barclays Capital's Municipal
Products Division combines
investment banking, underwriting,
sales and trading, derivatives and
reinvestment products into one ( a westcm t_urope Markets
unit, employing 172 municipal
professionals as of December 31,
2009. Our Public Finance Department provides investment banking services to government clients
nationwide, comprising 90 bankers organized into specialty groups (education, healthcare, housing, project
finance, transportation, and utilities) and regional teams (with offices in Atlanta, Boston, Chicago, Houston,
Los Angeles, San Francisco, San Juan, Seattle, and Washington, DC). Our Municipal Underwriting, Sales,
Trading, Derivatives and Research desks employ 82 professionals. Barclays Bank PLC now offers liquidity
in the form of Standby Bond Purchase Agreements and Direct Pay Letters of Credit, and two professionals
run this new business.
Packet Page -90-
3
3/13/2012 Item 5.13.
Capital Position. Our capital is an important qualification. The table below presents our net capital
position. Given Barclays' acquisition of certain of Lehman Brothers' North American assets in September
2008, analogous data for 2007 and 2008 are not available and would not be indicative of our current capital
' strength.
To highlight our underwriting ability, we served
' e on
as book - running senior manager on several large Total Equity Excess Net
financings: $3.5 billion of the State of in I M M capital Capital Net Capital Capital
California's Economic Recovery Bonds in 2008 s 11905 $9,362 $7,878 $7,3,78
. _.__.
October 2009; $1.5 billion State of Wisconsin 2009 $10,833 $7835 $7063 $6,432
General Fund Appropriation Bonds in February 2010' $10,570 $8, 22 $7,348 $6,684
2009; and $1 billion State of Illinois General *As of 613012010
Obligation Bonds in January 2010. Barclays Capital deploys capital to win competitive underwritings,
purchasing 30 issues of at least $100
million principal amount since October 1, (2009-Present)
' 2008. Barclays commits capital to support Issue Site Inventory
senior - managed issues; the table to the right Award Date Issuer Name (8 mm) (8 mm)
presents example transactions. 03/24/10 city of Farmington, New Mexico $203.5 $26.7
' 01/28/10 State of Illinois 1,000.0 24.4
Commitment to Housing. In addition to 01/14/10 Harvard University 480.0 36.5
lri 11/06/09 Town of Hempstead Local Development 50.0 23.6
purchasing bonds as an underwriter,
10/15/09 Texas A &M University 320.8 73.3
' December 2008 Barclays Capital assumed a 04/27/09 Miami -Dade County, Miami Intern'l Apt 600.0 27.3
forward- delivery contract between 03/11/09 University of Pittsburgh 428.5 27.8
MassHousin and Lehman Brothers related 02/19/09 Georgia State Road and Tollway Auth 600.0 93.6
g 02/04/09 Los An eles Unified School District 950.0 58.3
to bonds priced in November 2007 for
delivery in April 2009. In making itself liable to incur losses if the forward delivery failed (on bonds then
valued at a deep discount), Barclays demonstrated commitment to its housing and investor clients. More
broadly, Barclays used capital to support housing clients at critical junctures in recent years, described below:
• As Remarketing Agent. On the day that Barclays Capital could start trading variable rate municipal
bonds after acquiring certain Lehman Brothers assets, our remarketing desk purchased aii of our sole-
, senior managed housing clients' Bank Bonds, exceeding $2 billion.
• As Swap Counterparty. During November and December 2008, Barclays Bank PLC entered swaps
' totaling over $3 billion in notional amount to replace housing clients' swaps with Lehman Brothers
subsidiaries, paying more than $350 million to enter the off - market interest rate swaps at a time when
few firms would provide these unsecured loans.
' mk*vq t Bet. icwm Hwning end UM Hpuelnp Odors. HD Wng
• As Liquidity Provider. Barclays Capital o0A„„�,�,,„,r R As..d ti_ Ow�'°n
continued its support for housing clients by MSS ,;� tlTAk Mf
pp,...
' entering the liquidity business early in 2009,.;�.6:ppo „p,,,�� „a,ppp.ppp we.000.000
9,glr�H 9npM Fam11Y 9 gp i Hy gMdtppa
writing $1.2 billion in Standby Bond Monp.p. Rw. u.9 Ma Mw[p.p. BdWS Monp�e R.uMNp
Purchase Agreements for the benefit of our �r Menage �r Ala ,gw $ o M,,,e„ 9N. Hame.k.09 Agent
housing clients in Colorado, Idaho, �n.2O UY 2OD9_ J'N 2009 A —st 2009
' Michigan and Utah.
Barclays Capital has one of the strongest capital positions in the industry which we regularly use to market
' and purchase our housing clients' revenue bond issues. During the past two years, we underwrote fixed rated
single family issues for HFAs in Colorado, Idaho, Michigan, Ohio, Pennsylvania and Utah.
4
1 Packet Page -91-
A114i
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I
3/13/2012 Item 5.13.
DISTRIBUTION CAPABILITIES
Barclays Capital would deploy our industry- leading institutional and retail sales forces, award - winning
research group, and liquidity products to create and maintain a market for the respective bonds and minimize
borrowing costs.
Institutional Distribution. Barclays is a fixed income powerhouse with nearly 2,000 fixed income sales,
trading, and research professionals worldwide. Barclays' municipal institutional sales force is one of the
largest in the industry with 19 institutional sales people who cover the primary tier of investors and crossover
buyers, and other municipal bond buyers nationwide. Our sales force covers over 1,000 institutional accounts
that include major bond funds, banks, trust departments, and investment advisors, as well as state and local
fund managers. In 2009, Greenwich Associates ranked Barclays Capital as #1 in Investment Grade Credit
Market Share. In addition, we ranked #1 in Fixed Income Market Share, High Grade Credit and Fixed
Income Sales, Trading and Research Quality by Institutional Investor magazine. Overall, our firm ranked #1
for the tenth consecutive year. In short, we rank first in those areas most critical to the successful marketing
of the Issuer's bonds.
The Barclays Capital Municipal Bond Index is the premier benchmark in the tax - exempt market and is used
by mutual funds, money managers, insurance companies, banks and asset managers. Each month, over 400
institutional buyers send their portfolios to our sales force, which uses the Index to identify funds that are
under- weighted in specific products or sectors, and which are therefore the most likely purchasers of new
issues. Our suite of indices also includes the Aggregate Index, the Credit Index, and the Long - Credit Index
which serve as benchmarks for life insurance companies, pension funds and other buyers of taxable bonds.
RBSEarCh. Barclays Capital provides its investor clients with the #I -ranked Municipal Strategy Research
group, and Institutional Investor has ranked Barclays' Fixed Income Research team #1 overall for ten
consecutive years. In 2009, Greenwich Associates ranked the firm #1 in Investment Grade Credit Market
Share. During the last year, the firm has also received recognition from Risk Magazine, International
Financing Review, Euromoney, and Profit & Loss Magazine for Derivatives, Debt, Foreign Exchange,
and other sectors in the US and worldwide.
InAtitudo1w
i rt
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1.L)
'
All- America Research
Awards for Excellence
Primary Debt Poll
Best Platform:
Municipal Strategy
House of the Year.
House of the Year
Polls
Best Primary Debt House
Multi- Product
for two mmm live years
Research Poll
Derivatives
Bond
#1 Equity Research
Best FX House
#1: Sterling Issues, Deal
Structured Product
#1 Overall
Current Derivatives
Y
Inflation Derivatives
sccurirization
Credit Derivatives
for seven consecutive years
#1 Fixed Income Research
Best FX House
Execution, Swap Provision,
Liability Management,
for thm con —utive years
FX Options
For six consecutive yeah:
Structured Pro ducts
December 2009
for ten consecutive years
m North America
Benchmark/Vanilla Issues
Q h DY
January 2010
October/September 2009
July 2009
June 2009
April 22009
Retail Distribution. Our firm's retail sales force of 250 professionals combines the Private Investment
Management Group with the added resources and strength of the Barclays Wealth Management Group to
ensure broad distribution of municipal bonds. Together, our national network of Private Investment
Management and Wealth Management professionals provides comprehensive investment, wealth advisory
and capital markets execution services for high- net -worth individuals and businesses, managing $13.3 billion
in accounts of $5 million or greater in the US. Barclays Capital attracts a large number of retail investors in
the transactions we lead, as illustrated by select recent transactions below:
Packet Page -92-
3/13/2012 Item 5.13.
Sale Date
Issuer
i mm
% of Deal
I; mm
% of Retail Orders
01/27/10
$237.2 million Southern California Public Power Auth
$261.2
110.1% 1
$235.4
90.1%
01/13/10
$423 million Lower Colorado River Authority
843.1 !
199.3
707.9
84.0
10/29/09
$3.4 billion California Economic Recovery Bonds
2,437.5
70.9
1,322.8
54.3
10/28/09
$218.8 million NYC Municipal Water Finance Auth
336.0:
153.6
175.0
52.1
08/18/09
$270 million District of Columbia Refunding Bonds
332.8
124.2
258.9
77.8
03/20/09
f' $1.5 billion Wisconsin General Obligation Bonds
303.8
20.3 !
109.2
36.0
03/11/09;
$794 million University of California Revenue Bonds
242.8
30.6
154.1
63.5
02/19/09
$600 million Georgia State Road and Tollway Auth
226.0
37.6
173.2
76.6
02/19/09
$950 million Los Angeles Unified School District
334.9
35.3
169.6
50.6
Pershing L L C. Barclays Capital also has an agreement with Pershing LLC,
a subsidiary of The Bank of New York Mellon Corporation, which expands M.
our clients' access to tax- exempt retail investors. Under the agreement,
Barclays is the principal source for Pershing's broker - dealer and independent registered investment
advisor (RIA) customers to acquire new -issue tax- exempt bonds. Likewise, Pershing is the principal
channel for the distribution of our new -issue product to customers outside our retail network. Pershing
has over $561 billion in assets held in custody, including 119,800 retail accounts with over $9.5 billion in
assets in Washington alone, providing us a platform to achieve significant individual retail participation
for the Issuer's offerings, in addition to our extensive coverage of retail aggregators.
' Retail Aggregators. Recent transactions have demonstrated that generating retail demand is no longer
contingent upon the size of a firm's brokerage network, but rather on a firm's ability to reach high -net-
worth retail investors through professional asset managers, or "retail aggregators," including individual
t and common trust funds, separately- managed accounts and investment advisors. Barclays Capital
accesses retail aggregators through its broad distribution network and through its Municipal Bond
Strategies Group to whom the retail aggregators turn for strategy and advice.
0
r
Liquidity P rod ucts. Since 2008, our municipal clients have requested access to Barclays' stable balance
sheet, and we have moved aggressively to support them. In 2009, Barclays Bank PLC began offering Standby
Bond Purchase Agreements to select issuers, beginning with housing clients, and earlier this year it expanded
its line of credit products to include traditional Letters of Credit and Revolving Lines of Credit. These
products enhance the marketability of our clients' variable rate debt. Currently, an extremely limited amount
of tax - exempt bonds and commercial paper carry enhancement from Barclays Bank, and we anticipate
expanding our portfolio selectively. We are experiencing strong demand from money market funds for
Barclays- supported paper due to its scarcity and Barclays' strong credit ratings. As a result, VRDBs with
Barclays credit facilities consistently trade through the SIFMA Index rate. The firm's senior management
team directly approved this long -term business expansion, and hired Jay Saakvitne and Patrick Boyer to head
the credit initiative. Both are veterans of the municipal credit business and bring over 25 years' of experience
to the firm. Barclays Bank would be pleased to discuss the provision of credit facilities for the Issuer's
bonds or notes.
FURTHER FINANCIAL SERVICES
We provide ongoing strategic planning guidance to housing clients regarding their outstanding bond issues
and parity indentures. If desired by the client, we provide cash flow modeling, interaction with rating
agencies, asset -parity calculations, bond redemption analysis, and swap monitoring, at no additional charge.
6
Packet Page -93-
n
3/13/2012 Item 5.13.
Performing the cash flow analyses that are the underpinnings of a transaction enhances our ability to offer
pertinent financial advice regarding new and existing bond issues. Barclays Capital works closely with our
housing clients to tailor cashflow and other analyses to address pertinent questions regarding financing
' alternatives, managing their debt portfolios and projecting the income various structures and indentures will
generate.
' In all engagements, we view our role as an extension of the Issuer's staff and provide additional services as
requested. In addition to cash flow modeling and other analytical services, we support our clients
quantitatively and administratively more broadly as described below.
' Bonding Authority Management. We routinely maintain a database of outstanding bond issues to ensure
10 -year and 32 -year rule compliance. More important, we work with issuers and their tax counsel to
maximize the value of available tax - exempt bonding authority, for example through efficient taxable
leverage, securitizing loans for reserves, and maintaining the integrity of Pre - Ullman debt. While maximizing
exchange refundings, we work with issuers to develop efficient means of warehousing volume cap so that
' bond payment dates do not drive the schedule for new offerings.
Strategic Planning. For some housing agencies we assist in developing longer -range strategic plans,
particularly related to identifying financial goals and developing action plans. We also assist in program
development, sharing ideas developed by other HFAs, and presenting alternative methods to finance and
price new loan programs.
Asset Management. For any program managed by the Issuer we would be willing to assist in developing
plans to maximize yields consistent with investment policies while also providing analyses on asset and
liability matching, and budget or income forecasting.
Liquidity Development. Our team has conducted extensive outreach to educate prospective liquidity
providers about housing bonds and the strengths of our housing clients. These meetings underscore
distinctions between HFAs and subprime lenders. Ken Gambone is our department's short-term specialist and
he has developed expertise and an extensive network of contacts in this area. Ken is always be happy to share
his insights with HFA clients in support of their marketing efforts to liquidity banks.
Short -Term Debt Management. As remarketing agent, we continue to be actively involved with our key
clients' debt portfolios, not only in resetting rates but also in helping clients implement strategies to reduce
' overall costs. We developed detailed tracking mechanisms in 2009 to help our clients manage their own
investment in VRDBs.
' Our Housing Group ranks in the top three housing groups over the last decade and second in single family
underwriting last year. Our group consists of nine professionals who have 22 years of experience on average.
Highlighting our team's cohesiveness, these individuals all transitioned together from Lehman Brothers to
' Barclays Capital; in fact, we have neither gained nor lost a senior team member since 2006, and six of our
senior bankers have worked together for ten years or more. Our Housing group is highly analytical. Since
seven of our nine team members run cashflow analyses, we undertake all structuring and analysis in house.
We take great pride in our senior - managed clients' resounding success in all market conditions. While
structuring efficient issues and managing their sale flawlessly is a critical part of our services, our
understanding of our role as senior manager is broader than simply underwriting bond issues. Barclays
7
Packet Page -94-
3/13/2012 Item 53.
' Capital has worked closely with clients to manage their outstanding debt and to precisely tailor their debt
portfolios to support program activities. Debt structures that minimize borrowing costs and interest rate risks
require active ongoing debt management and close tracking of loan production results. To this end, we take
as active a role as desired in helping sole - managed clients to manage the wealth of indentures. The
compelling pricing advantage that we attain for our clients justifies the heightened administrative efforts
' required. However, our best endorsement is the success of our clients, who have been consistently profitable
and productive, lending well above the HFA per capita average.
u
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L
i1
HOUSING TRANSACTION CASE STUDIES
Over the years we have developed and applied unique solutions to help clients overcome challenges. To
demonstrate, we describe specific transactions below.
Single - Family Mortgage Revenue Bonds
Senior Manager (Primary Bankers: Gary Brandt and Shannon Sharp)
June 2009
On June 23, 2009, MSHDA delivered the 2009 Series ABCD Bonds consisting of $177 million refunding bonds, $61
million remarketing and $50 million of new money. This transaction refunded DEPFA bank bonds and funded the
purchase of warehoused loans. More specifically, the refunding achieved three objectives: 1) Refund tax exempt unhedged
variable rate bonds as tax exempt serial bonds; 2) Refund taxable unhedged variable rate bonds as tax exempt serial and
term bonds; 3) Refund/Remarket outstanding AMT hedged variable rate DEPFA bank bonds as Non -AMT variable rate
bonds with the first -ever SBPA provided by Barclays Bank PLC. By refunding /remarketing the hedged bonds and then
structuring the rest of the transaction around the existing notional reduction schedule, MSHDA was able to keep the
original swaps intact, reduce its costly bank bond exposure by $177 million, and still earn positive spread. Upon replacing
the DEPFA liquidity facility with a Barclays Bank PLC facility the bonds were successfully remarketed and MSHDA
realized a reduction in interest rates of 3.25 %.
Idaho Housi Gerald Hunter
g
President and Executive Director
+>�► BARCLAYS and Idaho Housing s Finance Association
CAPITAL • A S S O C I A r t a x '°i `
565 e D 83702
• �1 Tel: (20Q 3314730
' $388,000,000 geratdh@ihfa.org
Single Family Mortgage Bonds
' Senior Manager (Primary Bankers: Robert Hynote and Barry Gottfried)
May 2009
' On May 13, 2009, Barclays Capital launched a US$388 million modified Dutch auction tender offer for Idaho Housing and
Finance Association (IHFA). Barclays Capital was Sole Dealer Manager on the tender offer across 103 securities maturing
2022 through 2039.
We designed a tender and refunding strategy to help housing issuers benefit from provisions of the American Recovery and
Reinvestment Act of 2009. This strategy allows bonds subject to the Alternative Minimum Tax (AMT) issued between
' 2004 and 2008, inclusive, to be refunded with non -AMT bonds issued in 2009 and 2010. HFAs may offer to buy bonds
8
Packet Page -95-
.l" *kw
+ BARCLAYS
Diratard Fjelop
M idx� State Housing
CAPITAL WSHDA
Da�dopnsd Authority
735 East Michigan
P.O. Box 300"
Lansing, Michigan 48909
$288,345,000
Tel: (517) 3354M
sykeq0'r'Chgn.g,,,
Single - Family Mortgage Revenue Bonds
Senior Manager (Primary Bankers: Gary Brandt and Shannon Sharp)
June 2009
On June 23, 2009, MSHDA delivered the 2009 Series ABCD Bonds consisting of $177 million refunding bonds, $61
million remarketing and $50 million of new money. This transaction refunded DEPFA bank bonds and funded the
purchase of warehoused loans. More specifically, the refunding achieved three objectives: 1) Refund tax exempt unhedged
variable rate bonds as tax exempt serial bonds; 2) Refund taxable unhedged variable rate bonds as tax exempt serial and
term bonds; 3) Refund/Remarket outstanding AMT hedged variable rate DEPFA bank bonds as Non -AMT variable rate
bonds with the first -ever SBPA provided by Barclays Bank PLC. By refunding /remarketing the hedged bonds and then
structuring the rest of the transaction around the existing notional reduction schedule, MSHDA was able to keep the
original swaps intact, reduce its costly bank bond exposure by $177 million, and still earn positive spread. Upon replacing
the DEPFA liquidity facility with a Barclays Bank PLC facility the bonds were successfully remarketed and MSHDA
realized a reduction in interest rates of 3.25 %.
Idaho Housi Gerald Hunter
g
President and Executive Director
+>�► BARCLAYS and Idaho Housing s Finance Association
CAPITAL • A S S O C I A r t a x '°i `
565 e D 83702
• �1 Tel: (20Q 3314730
' $388,000,000 geratdh@ihfa.org
Single Family Mortgage Bonds
' Senior Manager (Primary Bankers: Robert Hynote and Barry Gottfried)
May 2009
' On May 13, 2009, Barclays Capital launched a US$388 million modified Dutch auction tender offer for Idaho Housing and
Finance Association (IHFA). Barclays Capital was Sole Dealer Manager on the tender offer across 103 securities maturing
2022 through 2039.
We designed a tender and refunding strategy to help housing issuers benefit from provisions of the American Recovery and
Reinvestment Act of 2009. This strategy allows bonds subject to the Alternative Minimum Tax (AMT) issued between
' 2004 and 2008, inclusive, to be refunded with non -AMT bonds issued in 2009 and 2010. HFAs may offer to buy bonds
8
Packet Page -95-
' 3/13/2012 Item 5.13.
from current bondholders in the secondary market through a tender process, funding the purchase with Non -AMT
refunding bonds. Because the AMT bonds have become illiquid and were trading in early 2009 at a deep discount, several
clients achieved economic benefits, through discount purchase prices and coupon savings.
' Because of the discount, HFAs issued a smaller amount of refunding bonds than the par amount of bonds tendered,
reducing liabilities and ongoing debt service. The end results were net present savings of over $3 million.
C
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11
This represented the first Barclays Ca
Management transaction in the US municipal market.
Timothy C. Sullivan
0101 Frmwd Director
BARCLAYS M ASSHOUSIN G One Bea= Strad
CAPITAL Boston, MA 02108
$103,575,000 Td: (617)e5a -1258
to 1ivai@rfflEhmzng. n
Housing Bonds
Senior Manager (Primary Bankers: Barry Gottfried and Shannon Sharp)
November 2007 and April 2009
On November 29, 2007, Massachusetts Housing Finance Agency (MassHousing or MHFA) issued the 2007 Series C,
Series D and Series E bonds to finance various multi- family residential. developments. Series D, which financed a
construction loan, was structured as a stepped- coupon bond in which the coupon increased from 3.90 to 6.40% after two
years. MHFA had previously funded construction loans under its Insured Construction Loan Note Resolution (ICLN), but
sought an alternative because insurance had become expensive. The Housing Bond Resolution does not require bond
insurance, but the debt service reserve fund requirement of six months maximum debt service would have been onerous if
the bonds were issued as notes with a two- year maturity. We structured the bonds with a coupon that stepped up after two
years, a ten -year level debt amortization and a two- year optional par call. This structure minimized the debt service reserve
fund requirement and allowed MHFA to redeem the bonds at the end of the construction period and to finance the
permanent loan more efficiently. Furthermore, the client avoided the use of bond insurance (which our clients in Colorado,
Idaho and Utah routinely avoid through the issuance of multiple classes of bonds).
The 2007 Series F (AMT) and G (Federally Taxable) bonds were issued for forward delivery on April 9, 2009 to refund
three outstanding multi - family housing bond issues callable on July 1, 2009. In December 2008, Barclays Capital agreed to
assume the forward- delivery purchase contracts from Lehman Brothers in an effort to demonstrate Barclays Capital's
commitment to MHFA and the investors. We made ourselves liable for a significant sum if the forward delivery failed, as
the bonds were valued at a deep discount to par when we assumed the contracts. (Fortunately, the bonds were delivered as
planned.) We were pleased that our firm supported MassHousing and showed it commitment to our HFA clients and our
investor clients.
This document is for information purposes only and it should not be regarded as an underwriting commitment, as an offer
to sell or as a solicitation of an offer to buy the securities or other instruments mentioned in it. No transaction or services
related thereto are contemplated without Barclays Capital's subsequent formal agreement. In addition, any provision of
investment banking services is subject to a formal agreement between the parties. Absent a written agreement to the
contrary, neither Barclays Capital nor any of its employees is providing financial advice herein.
No part of this document may be reproduced in any manner without the written permission of Barclays Capital. We do not
represent that this information is accurate or complete after the date of this document and it should not be relied upon as
such. Opinions expressed herein are subject to change without notice.
IRS Circular 230 Disclosure: Barclays Capital and its affiliates do not provide tax advice. Please note that (i) any discussion
of U.S. tax matters contained in this communication (including any attachments) cannot be used by you for the purpose of
avoiding tax penalties; (ii) this communication was written to support the promotion or marketing of the matters addressed
herein; and (iii) you should seek advice based on your particular circumstances from an independent tax advisor.
Barclays Bank PLC ( "Barclays "), conducts its U.S. underwriting and broker - dealer activities through its wholly -owned
indirect subsidiary, a registered broker - dealer, Barclays Capital Inc. (`BCI "). BCI is a member SIPC. Registered Office:
745 Seventh Avenue, New York, NY 10019.
Copyright Barclays Bank PLC, 2010 (all rights reserved). This document is confidential, and no part of it may be
reproduced, distributed or transmitted without the prior written permission of Barclays Capital.
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3/13/2012 Item 5. B.
LOCKHEED MARTIN AND ENERGY SOLUTIONS OVERVIEW
Lockheed Martin Services, Inc., (LM) a wholly owned subsidiary of
Lockheed Martin Corporation, stands as a premier provider of energy
engineering and efficiency services. As one of the largest implementers of
utility energy efficiency programs in the country, LM helps utility
customers conserve energy and protect the environment, while simultaneously rncreasrng operational efficiencies
and maximizing the value of their capital spending. Currently, we are providing energy engineering, technical
support and program management services for government and utilities, such as Pacific Gas & Electric, Southern
California Edison, Energy Trust of Oregon, Ameren, Pepco Delmarva Power, Consolidated Edison of New York,
National Grid, NSTAR, and Cascade Natural Gas. LM has installed over 1,200 GWh of annual energy savings for C&I
customers and over 500 GWh for residential and multi-far* customers.
Lockheed Martin operates in all 50 states and 75 countries at more than 1,000 facilities. We bring management
' expertise applied in a synergistic way to address complex technical and business challenges, and offer the skill and
talent of our 126,000 employees, more than half of whom are engineers or scientists. LM places significant
emphasis on partnering with our customers, implementing best practices and achieving outcomes in support of
customerobjectives.
Lockheed Martin offers a customer - focused solution that combines proven energy engineering expertise to drive
' comprehensive and deep penetration of energy savings projects with an understanding of the key decision factors
impacting a customer's decision to engage and complete the energy efficiency project This approach, combined
with our proven processes, procedures, technology, and experienced personnel, will ensure that Chicago's
businesses and industries receive professional level service tailored to their unique requirernents along with the
necessary hand holding to complete the efficiency projects.
' Energy Solutions
L.M's energy -wlated services are centered within the Energy Soldhonsunit These services and con4)dmcies include:
' ♦ Energy Efficiency Program Design & Implementation
♦ Energy Engineering, Consulting and Technical Assistance
♦ Measurement and Verification
♦ Marketing, Customer Education and Engagement
♦ Demand Response Solutions
♦ Federal Energy Management and Performance Contracting
♦ Smart Grid, Facility Monitoring & Control, and Cyber Security Services
' For a typical program, specific market-based teams are assigned to deliver the program to targeted market
segments, including large office, health /hospitals, higher education, K-12 schools, food service, lodging, industrials,
' retail, auto services, faith -based groups and non-profits organizations. Lockheed Martin employs a dedicated team
of program management, marketing and engineering professionals.
Our marketing team: 1) develops and maintains relationship with a variety of market players, including program
participants, Trade Allies, utility account managers, corn mmty and civic groups, and other regional Energy
r
Packet Page -104-
3/13/2012 Item S.B.
' Efficiency organisations; 2) delivers and manages projects form application to incentive delivery, and 3) defines
and assists in the design and placement of marketing collateral (print, web, bill insett� etc.).
Our engineers: 1) perform technical analysis studies or assign/receive studies from approved engineering�ally
organizations; 2) review the completed studies and confirm that the savings and estimated costs are reasonable; 3)
calculate incentive amounts; 4) present study results to facility decision makers; 5) research and develop new
measure offerings; 6) verify the installation of the equipment and, in some cases, oversee the commissioning of the
installation to ensure proper operation; and 7) perform measurement and venficat<on to ensure the energy savings
are achieved
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Company Name:
Bidder LrVI Information
Lockheed Martin Services, Inc.
Business Established (year):
3/18/1993
Federal EIN Number:
52- 1813509
DUNS ID Number:
80- 525 -8373
Total Employees:
12,600 (126,000 in Corporation)
Headquarters Location:
700 North Frederick Avenue, Gaithersburg, MD 20879 -3328
IPacket Page -105-
3/13/2012 Item 5.13.
Case Study— Southern California Plastics Manufacturer
i.
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Rewits and ComprehensHe Project 8►eskdown
The comp#Phenshre prgad had a simple payback of apprommatYy 1 5
years. The Installed projects resulted in veRMd energy savhgs of
1,787,983 k1hA per year The energy savings for M focally resumd in an
annual electricity cost savings of more oian S230.000. using SCE's
Industrial Energy efficiency program complimentary eng""fing services
and Inwrilve turd&. the customer received over S 140.000 as Incensves ell
Implement the projects. Fudhtirmote, ttte project helped Ww ow"Unity of
southern Callfoinla by etmirosng more enan 1.7 mllan pounds Of harmful
greenhoum gases that otherxise would have been #Pleased into the
surrounding environment
ENERGY EFFICIENCY SAVINGS
Project kWh Saved /w COO SaeINWVW Incentive
install SCADA convol
system 729 436 $94.827 $56355
Deduce high pressure
system setpoint 946.187 $1.13004 $75.695
Install high- eflluency
noules on inlecson
motdtngmachini&S 112.360
Protect total 1.787.083
Total 6146 Reduction
Packet Page -106-
S14.607 58.989
5232.438 $143.039
1,700.000 Ibis of COr
'
Plastics Monufacurin8
Situation
A .Southern California plastic botto manufacturer uV ¢es
tr.evti high pressure air comp�@$Sors a$ part of their
man tfactufing processes As high pressure compressed
air mqu res a A" amount of energy ro produce tnti bOtOO
manufacturing facility sought .:ays to reduce Me ene'gy
requirements of "1! system
'
Solution
A three- prongtid approach .vies taken in order to reduce 'he
energy required to produce high pressure compressed air
of the facility First a Supervisory Control and u^ate
'
ACqutsibon •SCADAI system ,:as instalied in Order to
Defter Control the production process as +:e.I as to rn:htniize
the energy .taste in the Oplifatron Or the nigh pressure
compressors The system cortrols he shutdo,n of high
pressure compressors during non production periods and
'
Dotter contro s the s"i.MMir+g Of compressors to provide
the necessary amount of air in the most efficient -':ay
possib 0
Nest the O> erall system pressure '•as reduced in order to
'
reduce the amount O' energy noticed to compress the air
it ;. as discovered that in fact the laclkfj did not need to be
operabng at such a nigh pressure By s,mpiy o +.tiring the
pressure setpOmt tote facilrry :.as 301e tO rOWIZe immediate
energy savings at no cost.
'
Trwo. tree no=es on the InleChon molding machines :•are
replaced •,•!th high- efficiency no=os. Each irV*cuon
mold :ng machine requires 140 cubic feet per minute of air
10 coo me rot plastc preforms exiting " mother. By
msiall,ng h1h- effic-drity nOZZ44 " regmslla amours! Of
Compressed air 'as reduced
1
b
Rewits and ComprehensHe Project 8►eskdown
The comp#Phenshre prgad had a simple payback of apprommatYy 1 5
years. The Installed projects resulted in veRMd energy savhgs of
1,787,983 k1hA per year The energy savings for M focally resumd in an
annual electricity cost savings of more oian S230.000. using SCE's
Industrial Energy efficiency program complimentary eng""fing services
and Inwrilve turd&. the customer received over S 140.000 as Incensves ell
Implement the projects. Fudhtirmote, ttte project helped Ww ow"Unity of
southern Callfoinla by etmirosng more enan 1.7 mllan pounds Of harmful
greenhoum gases that otherxise would have been #Pleased into the
surrounding environment
ENERGY EFFICIENCY SAVINGS
Project kWh Saved /w COO SaeINWVW Incentive
install SCADA convol
system 729 436 $94.827 $56355
Deduce high pressure
system setpoint 946.187 $1.13004 $75.695
Install high- eflluency
noules on inlecson
motdtngmachini&S 112.360
Protect total 1.787.083
Total 6146 Reduction
Packet Page -106-
S14.607 58.989
5232.438 $143.039
1,700.000 Ibis of COr
1 Case Study - St. Louis Area Grocery Store
AmerenUE Energy Solutions:
Managing Costs in Grocery Stores
Energy is one of the grocery indus-
trv's top operating costs after shelf
stock. Although this energy usage
only reoreser,ts aoout 1 percent of
total grocery store costs, a typical
grocery's profit margin averages
around 1.84 percent according
to the Food Marketing Institute.
Therefore. a 10 percent reduc ion
in energy ; osts for the average
grocery store car, boost r,rof t r:ar-
gins by as much as 6 percent
To encourage grc-cers to install
energy r-fflci�ri :y measures.
AineienllE s Business Energy
Effuiencv ploor»nt is nfferuttt
c, sh mceimves for the purchase
and ins ?allation of qualifying energy
ejficiert upgrades in Refrigeration.
Lighting, Motors and H':AC. This
Zact sheet provides an overvie :v of
some n� cost and loyv. -cos: energy
savings tins as :vell as long -term
I
energy manaor-,�nt solutions
that qualify *or incertives through
UE's program
Overall re nnera'icn 9rd lighting
represent 3bo;.t 5g percent of to-
;al energy use i =ig re making
these systems the best targets fcr
energy sating: help sa-ve ^- .,on-
ey and enernv, =pilot +: ;liese cos'
sa-fin.. SOIUhOns
Train your s:aff t_, Turn of
lights r of =ices, creak rooms, stc•r-
ag" rccros, bathro r--,s aril . ^;alp --n
refriaAratcrs. Installing occ..panry
sersors is ano:her effec:,v= :.av
enzzure iigf -ts are of .,:hen nc cne
is around 3rd -an save ar average
of 10?' -, of lighting enernv. Uc of-
`ers a cash incer.tive up- to S45 Der
man
installed occupancy sensor.
thro
Comouters.
'�'
rash registers, deli scales and
cook.trg equipment should be
lade
furred off wher roi it use. Pur-
and
chasing "smart" power strips 'with
oacit
built -m sensors to porter down
peg,
plugged -in devices 'wh•c-r no users
sons
are presert are a good option
crop
Turn
ti ;hi
temperature settings down in
orev.
warmer seasors and up in cooler
on d
seasons wl er your store Is clOSed.
Irstalhng a orcgrar-tmable Thermo-
stat is 3 cost - effective tcc•I that can
Sch'
help msrage the stores tempera-
unit
:ure -year ra.:rd
Ilea
3/13/2012 Item 5.13.
Change filters
ihly :o ensure clear airflw.,
.gl- your equipment and facil-
0itt accumu-
n impairs groper heat transfer
louvers the ef;iciency ar:d ca-
1 of air conditioners. At the
nnmg ;rd end of coolirg sea-
thoroughly wash :he coils.
tight seals and
erly closing doors prevent
m air from entering the cases
t- reduces cooling energy and
ents fros: build up or 's:�tieat"
oors.
eidule rC-01.13r ma ntenance on
s and keep evapora :or coils
r and Tree of ice build -up.
Fire 1 Easton by eni nse ii IfMMW prsctry sfaret.
'a:
C:_ ,
Packet Page -107-
k
Packet Page -108-
3/13/2012 Item 5.B.
SOLUTIONS
i.Ipgrade tr, High - Efficiency Light"_JgL
» Relamping from T12 to T8 with electronic ballasts can reduce your
lighting consumption by 35 percent.
I » Update display case lighting to T8's to reduce energy consumption by
13 percent.
Boost lighting quality and efficiency by upgrading to T5's in ceiling
j fixtures.
» Retrofit exit signs with efficient LED kits and earn $12 per sign.
j» Evaluate your parking lot lighting for any additional upgrades.
'_�jitlf111Z@ i'a�f11�9ftILf1
'
�
» Install anti -sweat heater controls on display cases. These controls
sense humidity conditions and turn heaters off when unneeded, rath-
er than allowing them to run 24 hours a day. UE offers an $80 cash
incentive per door.
» Add strip curtains and improve efficiency of your walk4n freezers.
» Install evaporator fan controls in refrigerated cases and walk-in cool-
'
ers and receive a $70 incentive per unit.
s
F'{en for the F,Iture
» Consider having someone survey your store for energy savings. UE
offers financial incentives for studies and can help you analyze im-
provements to your facility.
» Purchase ENERGY STAR® qualified appliances and HVAC equipment
to achieve optimal energy savings.
» Get employees onboard with helping your store reduce its carbon
footprint. Show "Rhythm of a Store" video. Start a "green team"
to monitor the store and make suggestions on how to improve ef-
ficiency.
» Research and apply for possible federal or state rebates as well as
your local gas company's available rebates.
F ,r n, -re urton�iattvn yl�_I �•. r rf •a,w { r�� �'t au:,lrfrj= fc�r r,a•1,
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Packet Page -108-
3/13/2012 Item 5.B.
' 3/13/2012 Item 5. B.
' Case Study— Office Building Columbia Square 55513th Street, NW Washington DC 20004
Project Summary
r
n
Washington, DC.
The Pepco C &I Energy Savings Program for the District of
Columbia officially launched on August 17, 2009 with Lockheed
Martin as the turnkey program management and engineering
contractor. Lockheed Martin working with Hines Property
Management immediately identified an opportunity to make energy
th
efficiency improvements at Columbia Square 555 13 Street, NW,
Columbia Square is a 601,003 square -foot building that was built in 1987 and is situated
east of the White House. Columbia Square's design, which includes a 13 -story grand
atrium, requires a high level of temperature control which can be a challenge for most
buildings. Hines, the developer, owner and manager of Columbia Square replaced (40)
existing motors with (40) new NEMA -rated premium- efficiency electric three -phase
motors and installed (40) variable frequency drives (VFDs). The combination of new
motors and VFD's created an annual energy savings of over 750,000 kilo -watt hours
(KWH). Hines' energy saving efforts earned them a cash incentive of $98,815, which is
the largest incentive paid out in DC since the program was launched.
"Continuing our commitment to energy efficiency and sustainability at Columbia Square,
Hines has installed 40 variable frequency drives and 40 new NEMA -rated premium -
efficiency motors on all base building air handling equipment serving the office floors, as
well the installation of VFDs on the outside air units. As a result of these projects, we are
able to provide greater indoor environmental temperature control to the tenant end user
while drastically reducing the building's energy consumption by 752,000 kilo -watt hours
(kWh) annually. Reducing the amount of power consumed reduces Columbia Square's
carbon footprint as well as the amount of power that needs to be supplied by the local
utility provider. This furthers supports Hines' commitment to continuously strive to be
the industry leader in sustainability, and to be a good steward of the environment and the
community in which we conduct our business." Erin Kuhn, Property Manager for
Columbia Square.
The Pepco C &I Energy Savings Program is available to all DC and Maryland Pepco
Commercial and Industrial customers. The program is designed to promote and
encourage the incorporation of energy efficient- equipment, products and services into
construction, renovation or replacement projects, large and small. We would like to thank
the team from Columbia Square, Earl Keeler, Engineer and Erin Kuhn of Hines and
Kenny Comba of CDS Mechanical for their efforts in supporting the Pepco C &I Energy
Savings Program.
IPacket Page -109-
' *ECO2ASSET 3/13/2012 Item 5.13.
SOLUTIONS
LYKE S EROS. INC.
400 N. Tampa Street, Suite 2200 • Tampa, FL 33602 • (813) 470 -5034
I
J
ECO ASSET SOLUTIONS PROJECT EXPERIENCE AND REFERENCES
City of Clearwater
100 S. Myrtle Avenue, 31d floor
Clearwater, FL 33756
Lauren Matzke, Planner III
(727) 562 -4547
0
Clearwater
v
Project includes a community -wide greenhouse gas (GHG) inventory and business -as-
usual forecast for the City of Clearwater (Population, 110,169); development of a
customized greenhouse gas calculator tool for future emissions tracking; identification
of greenhouse gas mitigation strategies related to HB697 including future land use,
transportation, conservation and housing; stakeholder engagement involving city
employees and citizens through meetings and interactive open houses; formation of
stringent but attainable GHG reduction goals and targets; and comprehensive plan
policy draft language that aligns with the greenhouse gas strategies and reduction
goals.
Pinellas County
12520 Ulmerton Road Pinellas
Largo, FL 33774 County
Mary Campbell, Extension Director
(727) 582 -2100
Development of an Energy and Conservation Strategy for Pinellas County (Population:
910,260) that was awarded $3,791,300 by the Department of Energy (DOE) to fund eight
diverse activity projects.
'
Pinellas County
12520 Ulmerton Road
Largo, FL 33774
Mary Campbell, Extension Director
(727) 582 -2100
' 1
Packet Page -110-
Pinellas(�G
County
(@ECO2ASSET 3/13/2012 Item 5.13.
SOLUTIONS
LYRES EROS. ANC.
400 N. Tampa Street, Suite 2200 • Tampa, FL 33_602 • (813) 470 -5034
Project includes a greenhouse gas inventory for all government operations, a carbon
offset evaluation of more than 17,000 acres of County parks and preserves, and
' greenhouse mitigation strategies to support the creation of the County's Climate Action
Plan
Hillsborough Community College Hi usgo�cTR
39 Columbia Drive
Tampa, FL 33606 -3584
Barbara Larson, CFO
98130853 -7015
Community College lE
Scope of work consist of developing a Climate Action Plan [CAP] for Hillsborough
Community College [HCC] that complies with the standards set forth by American
College and University's Presidential climate Commitment [ACUPCC]. The process with
identify short, medium and long term greenhouse gas reduction strategies and establish
reduction goals and targets with the ultimate goal of eliminating HCC's GHG emissions
[i.e. carbon neutral]. Staff and students will be engaged through social media and
meetings to solicit strategies and feedback that will be incorporated into the final
-..
Greenhouse Gas Inventory and Climate Action Plan
Valencia Community College
1800 S. Kirkman Road
Orlando, FL 32811
Winsome Bennett, Energy Conservation Manager
(407) 582 -1768
Project consisted of a baseline greenhouse gas inventory and Climate Action Plan for the fourth
largest community college in Florida (Student population: 50,255). A stakeholder engagement
process based on one -on -one interviews, online surveys and on -site meetings was used to guide
strategy development for the Climate Action Plan. The Climate Action Plan included reduction
targets, greenhouse gas reduction strategies and a target date for climate neutrality.
Durham County Government
City- County Sustainability Office
120 E. Parrish St., 1 st Floor
Durham, NC 27701
Tobin Freid, Sustainobility Manager
(919) 560 -7999
2
Packet Page -111-
(@ECO2ASSET 3/13/2012 Item 5.13.
1 SOLUTIONS
LYRES EROS. INC.
400 N. Tampa Street, Suite 2200 • Tampa, FL 33602 • (813) 470 -5034
Study included the selection of eight environmental sustainability indicators and relevant metrics
spanning air quality, water quality, land use, transportation and solid waste for Durham County
(Population: 262,715). Data was collected, analyzed and reported for each indicator.
. I
C
k
State of Maryland - Department of Natural Resources
580 Taylor Avenue OMARYLAND OF
Annapolis, MD 21401 � [r RALRF CK RC
y NATURAL RESOURCES
Rich Norling, Sustainability Manager
(877) 620 -8367
The project consisted of a greenhouse gas inventory of the Maryland Department of
Natural Resources operations. The final report included strategies to reduce emissions,
including efficiency measures, low- emission fuel substitution, and carbon sequestration.
' 3
Packet Page -112-
p
3/13/2012 Item 5.13.
ECO2ASSET
SOLUTIONS
LYM BROB. V=
jwakefield @ecoossetsolutions.com 813.470.5034
'
LYKES BROS, INC
Mr. Wakefield's professional experience spans over 12 years of
Manager of Corporate
service in corporate and investment banking, wealth and investment
'
Business Development
management and strategic corporate development. In 2007, Mr.
Wakefi eld joined the Lykes Bros.' executive management team
SUNTRUST BANK
and was responsible for strategic corporate growth and business
Wealth and Investment
development initiatives. As a result of this strategic work, Mr. Wakefi eld
'
Strategist Management Mana
9 g
planned, organized and launched EcoAsset Solutions for Lykes
Commercial Banking
Bros. Currently, he is the Managing Director of EcoAsset Solutions
Relationship Manager
and responsible for the division's operating performance.
Prior to beginning his work at Lykes Bros., Mr. Wakefi eld spent nine years
'
WACHOVIA BANK
working in various capacities of the fi nancial services industry. Initially, he
Media and Communications
worked for Wachovia Bank in Atlanta, GA in the bank's large corporate
CIB Group
fi nance group. In this role, Mr. Wakefi eld concentrated on credit structure
'
U.S Southeastern Region Large
and analysis as well as capital markets solutions and advisory for clients
Corporate Finance Group
located in the Southeast.
Following this role, Mr. Wakefield joined a newly formed
Master Intl. Business Mgmt.
Media and Telecommunications corporate and investment
banking at Wachovia. In this capacity, Mr. Wakefi eld was
Thunderbird
group
responsible for managing the due diligence and underwriting
BA, English
process related -to capital structure advisory and solutions that his
'
College of Charleston
clients used for corporate development, management buyouts, mergers
and acquisitions. In 2001, Mr. Wakefi eld relocated to Tampa to join
Wachovia's regional corporate banking group and subsequently, moved
'
USF Health — Center for
to SunTrust Bank where he worked in the Commercial Banking and Wealth
Innovation and
and Investment Management lines of business.
Transformation
'
Executive Leadership Program
Committee on Foreign
Strategies & Actions to Enhance Mobility, Increase Energy
Relations - Member
Efficiency & Conservation, L Reduce Greenhouse Gas Emissions
'
CEO Direct Regional
(HB 697 and SB 360)
Leadership Program, 2010
Clearwater, FL
USGBC
'
Florida Aquarium
Pinellas County's Greenhouse Gas Inventory and Project
Board of Directors
Reporting through the EECBG's Performance and Accountability
Leadership Tampa Alumni
for Grants in Energy (PAGE) Reporting System
'
Board of Directors
Pinellas County, FL
Executive Committee
Tampa Bay Partnership
Campus and Communities Sustainability Conference Urban
'
Pediatric Cancer Foundation
Forestry Offset Project
Cut for the Cure Campaign
Tampa, FL
Connect US_Tampa- Orlando
'
High Speed Rail
Valencia Community College Greenhouse Gas Inventory and
Board of Directors
Climate Action Plan
Hillsborough County Head Start
Orlando, FL
'
Early Head Start
Honarary Board Member
PROVIDING RESPONSIBLE
SOLUTIONS THAT PROVE THE VALUE OF SUSTAINABILITY
Packet Page -113-
' 3/13/2012 Item 5.13.
*ECO2ASSET
SOLUTIONS
' L4® 6R06. W G
' Carbon Capture and Sequestration Study of Florida Board of
Trustees Lands for Florida Department of Environment (FDEP)
' State of Florida
Carbon Offset Presentation
Sustainable Communities & Campuses Conference
@ University of Central Florida
"Living Green"
Live TV interview
10 Connects - ABC Affiliate
01
October 2009
Rote of Sustainability in Corporate Profits
Tampa Bay International Business Summitt March 2010
Energy Finance Programs -A PACE Primer
' Webinar May 2010
Advancing Corporate Sustainability Strategies
' University of Tampa Brazilian Executive Business Program
Sykes College of Business August 2010
' introduction to PACE
Pinellas Green Government Team August 2010
' Energy Finance Programs -A PACE Primer
USGBC Webinar August 2010
' Greehouse Gas Reduction and Energy Conservation:
Development Impacts under HB697
Land Development and Greenhouse Gas Emissions Series
400 N. Tampa St.
Suite 2200
Tampa, FL 33602
jwakefield@
ecoassetsolutions.com
813.470.5034
tPacket Page -114-
0
3/13/2012 Item 5.13.
WW 1 LLUMN
FammiW uury,um
Background
Willdan Financial Services
Firm Background
Willdan Financial Services is one of six operating divisions within the parent company
Willdan Group, Inc. ( "WGI "). Serving more than 800 public agencies and private
sector clients nationwide, Willdan provides engineering, financial and organizational
management, and financial consultant services that ensure the quality, value, and
security of our nation's infrastructure, systems, facilities, and environment. The firm
has been a consistent industry leader in providing every aspect of municipal and
infrastructure financial services, engineering, public works contracting, planning,
building and safety, construction management, and homeland security solutions, plus
energy efficiency and sustainability services.
Founded in 1964, Willdan was established as a civil engineering firm specializing in
providing solutions for public agency clients. Since that time, we have evolved into a
professional consulting firm offering a broad array of services that allow us to provide
a comprehensive and integrated approach to our clients' planning, engineering,
financial, economic, public facility, energy, and public safety needs.
Regardless of the project size, WGI's operating divisions — Wilidan Financial
Services, Willdan Energy Solutions, Willdan Engineering, Willdan Geotechnical,
Willdan Homeland Solutions, and Wilidan Resource Solutions, — are structured to
provide our clients with all the resources they require.
Why use Willdan?
'
Financial
'Willdan
Services' Contact
Information
Lee R. Evett
'
7380 Sand Lake Road,
Suite 500
'
Orlando, FL 32819
407.352.3958 office
407.739.9190 cell
fax
'888.326.6864
levett @willdan.com
3/13/2012 Item 5.13.
WW 1 LLUMN
FammiW uury,um
Background
Willdan Financial Services
Firm Background
Willdan Financial Services is one of six operating divisions within the parent company
Willdan Group, Inc. ( "WGI "). Serving more than 800 public agencies and private
sector clients nationwide, Willdan provides engineering, financial and organizational
management, and financial consultant services that ensure the quality, value, and
security of our nation's infrastructure, systems, facilities, and environment. The firm
has been a consistent industry leader in providing every aspect of municipal and
infrastructure financial services, engineering, public works contracting, planning,
building and safety, construction management, and homeland security solutions, plus
energy efficiency and sustainability services.
Founded in 1964, Willdan was established as a civil engineering firm specializing in
providing solutions for public agency clients. Since that time, we have evolved into a
professional consulting firm offering a broad array of services that allow us to provide
a comprehensive and integrated approach to our clients' planning, engineering,
financial, economic, public facility, energy, and public safety needs.
Regardless of the project size, WGI's operating divisions — Wilidan Financial
Services, Willdan Energy Solutions, Willdan Engineering, Willdan Geotechnical,
Willdan Homeland Solutions, and Wilidan Resource Solutions, — are structured to
provide our clients with all the resources they require.
Why use Willdan?
'
PACE projects provide a new concept of financing energy conservation and efficiency,
and wind resistant and renewable energy improvements through property -based
assessments. PACE's formation and operational requirements utilize our fundamental
disciplines of energy efficiency consulting and assessment methodology
'
implementation and administration.
Willdan has a proven, specialized assessment administration practice that has been
'
forming and administering assessment districts for over 20 years. Annually, we
administer more than one half billion dollars in assessments and special taxes for
clients from California to Florida. Willdan has over 60 finance professionals and 30
sustainability experts in house. Willdan's finance professionals have backgrounds in
'
accounting, economics, mathematics, loan processing, business, and related areas
that add to our depth of experience.
'
Willdan is the only firm that provides a solution combining these areas of expertise
with decades of demonstrated experience administering special districts and energy
efficiency programs.
• Willdan Energy Solutions has been involved in energy efficiency and
sustainability for over a decade. This Willdan division trains and qualifies
contractors.
1
Property Assessment Clean Energy Proposal to the Town of Cutler Bay
Packet Page -115-
' 3/13/2012 Item 5. B.
Wf LLDAN
Fm:u�a:d Surrcw
■ Wilidan Financial services has over 20 years experience administering all
types of financing districts, including assessment districts.
• Wilidan Engineering has been providing public agencies with reliable
engineering and planning consulting services for more than 40 years.
By harnessing our diverse skill set, we are able to offer all- inclusive programs to
public agencies looking for a dynamic approach to implementing a property assessed
clean energy program.
Property Assessment Clean Energy Proposal to the Town of Cutler Bay
2
Packet Page -116-
1
Property Assessment Clean Energy Proposal to the Town of Cutler Bay
3
' Packet Page -117-
Resumes
1
Lee R. Evett
1 Education
Vice PreSIdel -It of Southeast Operations
Masters in Public
Administration,
Indiana University
Lee Evett is the Vice President of Wilidan's regional office in Orlando, Florida. Mr.
1
Evett is responsible for economic consulting studies, local improvement districts,
Bachelor of Arts,
arbitrage rebate calculations, municipal disclosure, and district administration services
Purdue University
1
for agencies throughout the southeast United States.
Areas of Expertise
With extensive experience managing cities in 5 states, Mr. Evett comes to Wilidan
Assessment
with more than 35 years of experience as a City Manager, including 11 years as a
1 Methodology Studies
City/Town Manager in Florida. Mr. Evett possesses experience managing multi
Program Management i
jurisdictional utility operations — including the Town of Jupiter which the U.S.
Environmental Protection Agency recognized as having the "Best Utility Operation" in
Cost Allocation Plans
the four state area of Florida, Georgia, Alabama and South Carolina. Mr. Evett also
1
participated in a six jurisdiction settlement agreement in Colorado to fairly apportion
Cost of Services Analysis
private and public water rights to guarantee a free flowing Arkansas River in
Development Impact
perpetuity.
'
Fee Analysis
Select Project Experience
Financial Planning
City of Dania Beach, FL — Stormwater and Fire Assessment, Water and Wastewater
Rate, and Connection Fee Studies
1 Management Analysis
Okaloosa County, FL — Beach Re- nourishment Annual Assessment Administration
Utility Rate Design
City of Riviera Beach, FL —Water and Wastewater Utility Rate Study Update
City of Carrabelle, FL — Water and Wastewater Rate Study
'
Affiliations
City of Miami Beach, FL — General Fund Revenue Enhancement Study
International City /County
City of Tamarac, FL — Building Permit Fee Schedule, Methodology Conversion and
' Management Association
Update Study
Town of Southwest Ranches, FL — Fire Assessment Study Update
State Management
City of Pompano Beach, FL — Police Department Feasibility Study
Associations in Pennsylvania,
City of Port Orange, FL — Police, Fire, Parks and Transportation Impact Fee Study
Florida, Missouri, Colorado
Okeechobee County, FL — Fire Assessment Methodology Update Study
'
and California
Okeechobee County, FL — Emergency Medical Service (EMS) Assessment Study
Marion County, FL — Transportation Impact Fee Methodology Study
City of Deltona, FL — Police Department Feasibility Study
Florida GFOA,
1 Associate Member
Estero Fire District, FL — Financial Plan, Capital Improvement Plan
Florida CitylCounty
Florida Management Experience
1 Management Association
Town of Jupiter, FL — Town Manager /Chief Executive Officer
City of Cape Coral, FL — City Manager /Chief Executive Officer
35 Years Experience
1
Property Assessment Clean Energy Proposal to the Town of Cutler Bay
3
' Packet Page -117-
' 3/13/2012 Item 5.13.
WVVILLLJi"UV
Flmuaaul smy—um
Pamela Bernaba
Property Assessment Clean Energy Proposal to the Town of Cutler Bay
4
Packet Page -118-
Project Manager
Education
'
Bachelor of Arts in
Pamela Bernaba is a project manager based from Willdan Financial Services' Orlando
Business Economics and
Psychology, University of
office. Ms. Bemaba has been associated with Willdan since January of 2006 and her
California, Santa Barbara
work experience includes: revenue and expenditure analyses; demographic /
'
economic analyses; database integration and manipulation; documentation
Areas of Expertise
preparation; creating boundary maps; and client interaction If support.
' Assessment Methodology
Studies
Prior to joining Willdan's Financial Consulting Services group, Ms. Bernaba originally
served as an analyst assistant in the District Administration Services group. In this
Development Impact Fees
role, she handled property owner inquiries and exemption reviews for a major water
' and Fiscal Analyses
district; and completed cost recovery and pre -levy analyses.
Cost Allocation Plans
Project Experience
Cost of Service Analysis
City of Dania Beach, FL — Stormwater and Fire Assessment, Water and
Wastewater Rate, and Connection Fee Studies: The City desired to undertake a
Utility Rate Studies
very ambitious examination of their fire and stormwater assessment programs, as well
Special District
as its utility rate schedule and utility impact fees. Ms. Bernaba served as task
'
Administration /
manager for this engagement.
Formations
Town of Palm Beach, FL — Utility Undergrounding Methodology Assessment
Boundary Map
Program: The Town had requested the formation of a utility undergrounding
Preparation
assessment program to finance the removal of all overhead utilities for their re-
installation in underground vaults and trenches. Ms. Bernaba assisted in the
Database Integration
development of the formula matrix and assessment methodology used to determine
'
each parcel's assessment amount. Her analytical support ensured that all data was
5 Years Experience
collected, interpreted, researched, and accurately entered into the models.
City of Bartow, FL — Fire Assessment Methodology Study: This assignment
'
involved the creation of a fire assessment program as a long term reliable revenue
stream for fire services. Following the year of the initial study, the Willdan Team
prepared the update and subsequently submitted the levy to the Polk County Property
'
Appraiser and Tax Collector. Ms. Bernaba oversaw the update and levy submission.
North Port Fire Department, FL — Fire Assessment Methodology: Ms. Bernaba
assisted with the formation of a Citywide Fire Protection assessment. Her duties
'
included parcel research, as well as budget and assessment analyses.
Town of Southwest Ranches, FL — Update of Fire Assessment Methodology and
'
Fees: Willdan was retained by the Town to update the methodology and fees of the
Town's Fire Assessment Program based on cost of service principles. Ms. Bernaba
assisted with the evaluation of Town documents, ad valorem tax roll information, fire
call data, agreements, reports, as well as other pertinent data. She also helped
'
determine the full cost of fire service delivery and special benefit; fairly apportioned
assessable costs among each property category; developed a fair and reasonable
Method of Apportionment; determined assessment rates; reviewed assessment
methodology for legal sufficiency; and assisted with the calculation.
Property Assessment Clean Energy Proposal to the Town of Cutler Bay
4
Packet Page -118-
3/13/2012 Item 5.B.
VVILLUMN
F auu�c�at Sruv�:c3
1
Private and Public Sector
Clients
Willdan Financial Services Public Sector Client
City of Palm Desert, California — Energy Independence
Program /Administration /Formation
Contract Length: July 2008 to present
'
Scope of Services Provided: Willdan Financial Services assists the City of Palm
Desert, California by supplementing its staff in performing the fundamental
requirements for the administration of contractual assessments that willing property
1
owners have agreed to in order to finance public improvements, including energy
efficiency upgrades.
'
Type of Contract: Project Based Fee
Specific Accomplishments:
'
Contact Information:
Mr. Martin Alvarez
Redevelopment Manager
City of Palm Desert
'
73-510 Fred Waring
Palm Desert, CA 92260
(760) 346 -0611
'
malvarez @ci.palm- desert.ca.us
1
Property Assessment Clean Energy Proposal to the Town of Cutler Bay
5
1 Packet Page -119-
3/13/2012 Item 5. B.
' W Yv I LLLN1ry
F,ir <urca:d Scervc�rs
1 Project Narratives
' City of Palm Desert, California — Energy Independence
Program /Administration /Formation
Property Assessment Clean Energy Proposal to the Town of Cutler Bay
6
Packet Page -120-
California Assembly Bill 811 was signed into law on July 21, 2008 by Governor Arnold
Schwarzenegger. Five weeks later, Palm Desert's Energy Independence Program
( "PACE Program ") was launched with an available $2.5 million for loans, with 317
'
people already on the waiting list.
For nearly 20 years, Willdan has served as the City's special tax and assessment
consultant. As a result of their confidence in our services, Willdan was asked to serve
this
'
as the Program's assessment administration contractor to create and administer
ground breaking new program.
Palm Desert's PACE Program is characterized by a simple, straightforward
'
application process, with deliberately few barriers for participation; and the City covers
certain upfront and ongoing costs to support applicants. This Program has over 215
'
residents, who have received loan funds for participating improvements to date.
Seeking expert guidance in the creation of key documents and provision of practical
implementation advice, Willdan became an initial part of the implementation and
administration team. In this capacity Willdan worked closely with the City's staff,
C
PACE counsel, and financial advisor in development of the Program's administrative
infrastructure and systems, including advising on content, creation, and flow of
documents (e.g., Notice of Assessment Lien, amortization schedules, and "Truth in
'
Lending" statements). Willdan immediately set up the City's system and seamlessly
initiated program management. To date, Wilidan has responded to borrowers'
questions, prepared prepayment quotes, and charged the first levy to participating
'
property owners
Willdan currently provides ongoing annual district administration, Arbitrage Rebate,
and Disclosure services for the City of Palm Desert's 6 Assessment Districts, as well
City's
as their Community Facilities Districts. Willdan also administers the
Consolidated Landscaping and Lighting District with its 33 zones and subzones, 3
Property and Business Improvement Districts, a Drainage Benefit Assessment
District, a City -wide fire tax, and the new AB 811 Contractual Assessment (PACE)
'
District. In all, 47 Special Districts (comprising 86,123 parcels) are administered each
year.
Willdan coordinates with multiple City departments and personnel to collect budget
information, fund balances, development status, and attend Council meetings.
Wilidan also assisted the City of Paim Desert in the formation and administration of
'
CFD No. 2005 -1 (University Park). The district is comprised of low to high density
residential products and commercial / office spaces; and was formed to finance street,
road, water, park, sewer, storm drain improvements, and developer impact fees. The
types
'
Rate and Method of Apportionment for the tax had to account for different of
commercial, residential, and office properties; and involved negotiations among the
various commercial developers concerning tax levels and financed facilities.
Property Assessment Clean Energy Proposal to the Town of Cutler Bay
6
Packet Page -120-
3/13/2012 Item 5. B.
Project Background
The County desires to be the leader in providing a sustainable community for residents and businesses.
Pursuant to Section 163.08 Florida Statutes, the County intends to retain a Consultant to provide Third
Party Administrator and Financing Services for Lee County's proposed Property Assessed Clean Energy
(PACE) program, referred to herein as the Lee Energy Efficiency Finance (LEEF) Program. In order to
provide quick response and professional expertise in the administration and financing of the LEEF
program, the County intends to retain one (1) Consultant.
While pursuing this RFP process, the County reserves the right to award contracts to a Consultant who
will best serve the interests of the County and whose Responses are considered by the County to be
most responsive and responsible.
The County reserves the right to accept or reject any or all Responses, based on its deliberations and
opinions. In making such determination, the County reserves the right to investigate the financial
capability, integrity, experience, and quality of performance of each Consultant, including officers,
principals, senior management, and supervisors as well as staff identified in the Responses.
The County also reserves the right to waive minor variations or irregularities in the Responses. The
County will include an opt -out provision for local municipality participation.
Estimated Cost /Compensation: The Consultant will be compensated by providing financing to property
owners that participate in the LEEF program.
Estimated Contract Duration: One (1) Year, with the option to extend the contract for an additional
two -one (1) year terms. The County may terminate the agreement with a sixty (60) days notice without
giving any reason.
Qualifications: To be eligible to respond to this RFP, the Consultant must have provided similar services
to those listed under the Scope of Services listed in this RFP. Each Consultant must meet all legal,
technical, and professional requirements for providing such services. The Consultant shall provide such
additional information as the County may reasonably require. This includes information that indicates
financial resources as well as ability to provide and maintain the system and /or services.
Evaluation Criteria:
This document is a DRAFT and is subject to additional revisions.
Packet Page -121-
3/13/2012 Item 5.13.
1. Quality of the projects and accomplishments of the Consultant(s) in providing similar services to
entities comparable to the County.
2. Financial stability and financial worthiness of the Consultant
3. Consultant's track record of on time and within project performance
4. Credentials and accomplishments of the Consultant's team
5. Credentials and accomplishments of the Consultant Project Manager
6. Consultant's demonstration of best practices for PACE Financing per the DOE as laid out in the
Guidelines for Pilot PACE Financing Programs,
http• / /wwwl.eere.energy•gov /wip /pdfs /arra guidelines for pilot pace programs.pdf.
Scope of services
The Consultant can expect to provide services including, but not limited to the tasks identified below:
1. Energy Audit
2. Administration
3. Financing
4. Marketing /Education
5. Collection of Data and Performance Measures
6. Project Background
Task Descriptions:
1. Energy _Audit: The Consultant shall provide an energy audit to program applicants to identify
energy efficiency and renewable energy property improvement measures that are likely to
deliver energy and monetary savings. The Energy Audit shall be the initial step in the LEEF
program, providing the property owner with the information necessary to maximize the return
on investment for participation in the program.
2. Administration: The Consultant shall administer the LEEF program for the County. This includes,
but is not limited to facilitating and processing applications; providing customer service;
facilitating the Energy Audit; management of assessments and payments; recruitment, training,
certification and oversight of contractors who perform the qualifying improvements; and
ongoing program support.
3. Financing: As part of the LEEF program, the Consultant shall provide all of the upfront financing
for the qualifying improvements. The financing will be secured by a lien placed on the property
and the loan(s) will be repaid by a special assessment imposed against the property. It is
anticipated that this special assessment will be placed on the property owner's tax bill. The
This document is a DRAFT and is subject to additional revisions.
Packet Page -122-
3/13/2012 Item 5.B.
Consultant shall provide analysis of the costs associated with financing indicating that these
costs for the program will not be a barrier to participation or enrollment by the property owner.
4. Marketing /Education: the Consultant shall implement a marketing plan for the LEEF program.
As part of this marketing plan, the Consultant will create a local web portal outlining the
specifics of the program; a local outreach program utilizing the web, local media, and other
means to raise awareness in the community; and assist in training local contractors trained and
certified to participate in the program. The educational component will utilize the information
from the Energy Audit to assist the property owner in maximizing the effectiveness of the LEEF
improvements.
S. Collection of Data and Performance Measures: the Consultant shall collect data on the
effectiveness of improvements and other metrics that will assist the County in determining the
impact of the Program, including but not limited to Energy Audit results, improvements selected
by property owner, average cost per project, and percentage of applicants approved for
participation.
This document is a DRAFT and is subject to additional revisions.
Packet Page -123-