Agenda 06/11/2019 Item #9B (Pace Ordinance)06/11/2019
EXECUTIVE SUMMARY
Recommendation to further discuss the adoption of the Collier County Property Assessed Clean
Energy (PACE) Consumer Protection Ordinance to better protect the public by providing
additional requirements.
_____________________________________________________________________________________
OBJECTIVE: To further discuss the Collier County Property Assessed Clean Property Assessed
Clean Energy (PACE) Consumer Protection Ordinance to better protect the public by providing for
more restrictive or additional requirements not found in the PACE Statute or the Standard Membership
Agreement.
CONSIDERATIONS: This matter was first brought to the Board by Commissioner Taylor on March 12,
2019 as Item 10B. At the Board of County Commissioners March 26, 2019 meeting, the Board directed
the County Manager to work with all stakeholders to identify opportunities to provide additional
consumer protection, and to bring back at a future regular meeting an executive summary creating an
Ordinance that addresses the concerns brought forth by the Board. This was further discussed at the May
14, 2019 and May 28, 2019 regular Board meetings. The Board of County Commissioners voted at its
regular meeting of May 28, 2019 to terminate the Property Assessment Clean Energy (PACE) program
pursuant to paragraph 18 of the Standard Form Membership Agreement and instructed the County
Manager to bring back a PACE Consumer Protection Ordinance for consideration.
Staff has worked with the interested parties to prepare an Ordinance that tries to balance consumer
protections and maintain a viable program. The item, as presented, does not include a solar energy
component as an allowable use for the PACE program. This exception may still require further discussion
and direction from the Board.
Background
In 2010, the State of Florida passed its PACE enabling statute, F.S. Section 163.08, in an effort to
promote energy efficiency, renewable energy, and wind resistance/hardening measures for residential,
commercial, and industrial buildings throughout the State of Florida.
The PACE program is a method of public financing designed to have “qualifying improvements” paid for
through a special tax assessment, on the property, which would allow project expenditures to be spread
out over a term up to 30 years and repaid as part of a property owner’s tax bill. As outlined in Section
163.09(2)(b), Florida Statutes, eligible PACE improvements are limited to: energy efficiency (including
electric vehicle charging equipment) renewable energy equipment and wind resistance/hurricane
mitigation measures.
PACE financing is a land-secured assessment that property owners voluntarily undertake in order to
secure 100% up-front financing of a qualifying improvement, which includes fees and interest o ver the
term of the PACE assessment. PACE loans are unique in that they take priority over other traditional
liens, regardless of the date the prior liens were recorded.
In addition to economic and property value benefits, PACE also presents benefits in terms of resource
conservation, environmental protection, and hurricane preparedness. By removing barriers to
implementation of energy efficiency and renewable energy projects, PACE could result in decreased use
of energy and a shift to cleaner energy sources, decreasing air pollutants, and greenhouse gases. Florida’s
inclusion of resiliency projects in the list of eligible types could also increase the number of properties
with hurricane preparedness improvements.
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In 2017, by Resolution No. 2017-130, the Board of County Commissioners adopted a Resolution
establishing the Property Assessment Clean Energy (PACE) program within the unincorporated areas of
Collier County for residential, commercial and industrial properties. Since that time, by Resolution No s.
2017-127, 2017-128, 2017-129, and 2017-153, four PACE providers have entered into the standard
membership agreement and are operating a PACE program within Collier County. It has been reported
that potential abuses of the PACE program have taken place, largely from a minority of PACE program
contractors, which the proposed new Ordinance seeks to address.
This item was discussed by the Board on March 12, 2019 and then on March 26, 2019, where the Board
directed the County Manager to work with the PACE providers, the Collier Building Industry Association
(CBIA) and local housing organizations to bring back an updated Ordinance for consideration that
enhanced consumer protections while allowing the PACE providers to continue to operate within
unincorporated Collier County.
Research
Staff conducted a review of the current liens filed with the Collier County Tax Collector and requested
information from each of the four PACE providers to better understand how the current program is
functioning. The primary focus was on work performed, licensed contractor, permit issued, project
certificate of completion from the County, loan to appraised value, terms of loan, and the annual PACE
assessment owed. Staff was provided with feedback from Pasco and Palm Beach County and further
researched consumer protections within PACE programs throughout the state.
This Executive Summary, together with the attached documents, is intended to address concerns and
provide for additional consumer protections that are not currently identified within Resolution Nos. 2017-
130, 2017-127, 2017-128, 2017-129, and 2017-153.
Considerations for the Board
The purpose of the current PACE Program is to facilitate the financing of qualifying improvements in
accordance with Section 163.08, Florida Statutes, for County property owners within unincorporated
Collier County, including residential, commercial and industrial properties. This new Ordinance provides
for more restrictive and/or additional requirements not found in the PACE Statute, th e Standard
Membership Agreement or any other applicable law.
FISCAL IMPACT: A PACE program review and approval process by County staff would have a future
financial impact on the County General Fund of $30,000 per year. It is the responsibility of PACE
Provider and a Third-Party Administrator to secure the private financing necessary for the implementation
of the program, and they are responsible for recovering any losses in the event of defaults on the
assessments. They cover the costs of collecting the assessments and administrative costs through their
fees and interest rates.
GROWTH MANAGEMENT IMPACT: There is no Growth Management Impact associated with this
action.
LEGAL CONSIDERATIONS: This item has been reviewed by the County Attorney, is approved as to
form and legality, and requires majority vote for approval. -JAK
RECOMMENDATION: That the Board of County Commissioner adopt the Collier County Property
Assessed Clean Energy (PACE) Consumer Protection Ordinance to better protect the public by providing
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additional requirements and reconsider the decision to terminate the PACE program and associated
membership agreements identified within Collier County Resolutions Nos. 2017-130, 2017-127, 2017-
128, 2017-129, and 2017-153.
Prepared by: James French, Deputy Department Head, Growth Management Department
ATTACHMENT(S)
1. Ordinance PACE Consumer Protection - Final (JCF_v7) (PDF)
2. PACE program - Customer Disclosure Agreement Final (JFv5) (003) (PDF)
3. Legal Ad - PACE - 5-31-19 (PDF)
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COLLIER COUNTY
Board of County Commissioners
Item Number: 9.B
Doc ID: 9020
Item Summary: ***This item to be heard at 1:00 p.m.*** This item has been continued from the
May 14, 2019 BCC meeting.*** Recommendation to further discuss the adoption of the Collier County
Property Assessed Clean Energy (PACE) Consumer Protection Ordinance to better protect the public by
providing additional requirements. (James French, Deputy Department Head, GMD)
Meeting Date: 06/11/2019
Prepared by:
Title: Operations Analyst – Growth Management Operations & Regulatory Management
Name: Judy Puig
06/05/2019 9:11 AM
Submitted by:
Title: Division Director - Operations Support – Growth Management Operations & Regulatory
Management
Name: Kenneth Kovensky
06/05/2019 9:11 AM
Approved By:
Review:
Growth Management Department MaryJo Brock Level 1 Reviewer Skipped 06/04/2019 1:15 PM
Growth Management Department Jeanne Marcella Department Head Review Completed 06/05/2019 9:43 AM
Growth Management Department James C French Deputy Department Head Review Completed 06/05/2019 11:32 AM
Office of Management and Budget MaryJo Brock Level 3 OMB Gatekeeper Review Skipped 06/04/2019 1:15 PM
Office of Management and Budget MaryJo Brock Additional Reviewer Skipped 06/04/2019 1:15 PM
County Attorney's Office Jeffrey A. Klatzkow Level 3 County Attorney's Office Review Completed 06/05/2019 11:36 AM
County Manager's Office Nick Casalanguida Level 4 County Manager Review Completed 06/05/2019 2:24 PM
Board of County Commissioners MaryJo Brock Meeting Pending 06/11/2019 9:00 AM
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ORDINANCE NO. 2019 - _____
AN ORDINANCE OF THE BOARD OF COUNTY COMMISSIONERS OF
COLLIER COUNTY, FLORIDA, ADOPTING THE COLLIER COUNTY
PROPERTY ASSESSED CLEAN ENERGY (PACE) CONSUMER
PROTECTION ORDINANCE; PROVIDING FOR CONFLICT AND
SEVERABILITY; PROVIDING FOR INCLUSION IN THE CODE OF
LAWS AND ORDINANCES; AND PROVIDING FOR AN EFFECTIVE
DATE.
WHEREAS, individual residents of Collier County may wish to improve energy efficiency,
install energy improvements or retrofits, wind resistance/wind hardening measures, and improve
water conservation for residential, commercial or industrial properties; and
WHEREAS, one way to facilitate such improvements to real property is through a Property
Assessment Clean Energy (PACE) financing program pursuant to Section 163.08, Florida Statutes;
and
WHEREAS, a PACE financing program is a financing structure by which commercial or
residential property owners may voluntarily opt into a special assessment district to receive a loan
to finance energy improvements and retrofits, where those loans are repaid through an annual
assessment on the property owner's property tax bill; and
WHEREAS, PACE providers that have been created under Section 163.01(7) Florida
Statutes are considered local governments, and the County may select from those PACE providers
and enter into agreements with the selected providers, without proceeding with a solicitation; and
WHEREAS, by Resolution No. 2017-130, the Board (1) approved the establishment of a
PACE program within the unincorporated area of Collier County for residential, commercial and
industrial properties; and (2) approved a standard form membership agreement which would
among other things authorize a PACE provider to operate a PACE program within Collier County;
and
WHEREAS, a number of PACE providers have entered into the standard membership
agreement and are operating a PACE program within Collier County; and
WHEREAS, it has come to the Board’s attention that potential abuses of the PACE
program have taken place, which the Board wishes to correct and address by this Ordinance.
NOW, THEREFORE, BE IT ORDAINED BY THE BOARD OF COUNTY
COMMISSIONERS OF COLLIER COUNTY, FLORIDA, that:
SECTION ONE: Title and Intent
This Ordinance shall be known and cited as “The Collier County Property Assessed Clean
Energy (PACE) Consumer Protection Ordinance," and is intended to add requirements to the
provisions of Section 163.08, Florida Statutes, the Standard Membership Agreement and other
applicable law as it currently exists and should be construed consistently with the PACE Statute
and any such other applicable law. To the extent that the PACE Statute provides for additional
9.B.1
Packet Pg. 205 Attachment: Ordinance PACE Consumer Protection - Final (JCF_v7) (9020 : **PACE Program Modification)
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requirements not otherwise found in this Ordinance or applicable law; the provisions of the
PACE Statute must be met. To the extent that this Ordinance provides for more restrictive or
additional requirements not found in the PACE Statute, the Standard Membership
Agreement or any other applicable law, the provisions of this Ordinance shall apply.
SECTION TWO: Definitions
The following words, terms and phrases, when bolded and used in this Ordinance, shall
have the meanings set forth herein:
Board shall mean the Collier County Board of County Commissioners.
PACE Assessment shall mean the non-ad valorem assessment placed on a property owner's tax
bill as a result of financing obtained through a PACE Provider.
PACE Financing Agreement shall mean the agreement entered into between a property owner
and the PACE Provider or its administrator specifying the Qualifying Improvements to be
installed at the property and the terms and conditions for financing those improvements through
non-ad valorem assessments levied on the property.
PACE Provider shall mean an entity created pursuant to the PACE Statute that has entered
into a Standard Membership Agreement.
PACE Statute shall mean Section 163.08, Florida Statutes, as may be amended from time to
time.
Qualifying Improvements shall mean only those improvements defined by the PACE Statute.
Standard Membership Agreement shall mean the Board-approved standard form agreement
as described in Resolution 2017-130 and as entered into by the PACE Provider.
SECTION THREE: PACE Program Standards
At a minimum, PACE Providers shall comply with each of the following standards:
(1) Qualifying Improvements: PACE Providers shall finance, and contractors and owner-
builders shall construct or install, only Qualifying Improvements, which shall be properly
permitted and must comply with Florida and local codes.
(2) Customer Service: PACE Providers shall provide a high level of customer service,
including:
a. Access to customer service representatives by email and phone during normal
business hours;
b. A transparent customer feedback and complaint process with quick response and
resolution by both the contractor and the PACE Provider;
c. All complaints and resolutions shall be logged, with the following information at
a minimum: date and time of complaint, customer and contractor information,
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details of complaint, when and what actions were taken by both the PACE
Provider and the contractor, and final resolution; and
d. All disputes and complaints shall be investigated and resolved in a timely manner.
Reports of such disputes and complaints, the actions taken and how they were
resolved, or not resolved, shall be created and thereafter be treated as Public
Records and provided to Collier County, upon request.
(3) Additional Program standards for residential properties: In addition to requirements set
forth in Section 163.08, Florida Statutes, PACE Providers that finance Qualifying
Improvements on residential properties within Collier County shall:
a. Verify that each prior mortgage or financing instrument holder has been notified of
any proposed PACE Financing Agreement and PACE Assessment, or that the
mortgage or financing instrument holder or loan servicer has consented to escrow
sufficient funds to ensure payment of the annual assessment with each year's tax bill;
and
b. Prior to entering into a PACE Financing Agreement, require the property to file
with Collier County a Collier County issued PACE Customer Disclosure Document
that provides detailed PACE Assessment consumer information, which Document
must be signed by the property owner, notarized, and submitted to a designated
Collier County employee for review and approval; and
c. Supplementing subsection (12)(a) the PACE Statute, ensure that the total amount of
any and all PACE Assessments on any property does not exceed an aggregate
amount of twenty percent (20%) of the just value of the property as determined by
the County’s property appraiser; and
d. Ensure that the total amount of any annual taxes and assessments do not exceed five
percent (5%) of the property’s fair market value, determined at the time financing is
approved and ensure that the total amount of the annual Pace Assessments do not
exceed four percent (4%) of the total annual gross income of the property owner in
the prior calendar or fiscal year, based upon an affidavit or attestation by the property
owner of the owner’s total annual gross income; and
e. Limit the financing term to ensure it does not exceed the amount of time identified in
the product manufacture’s original stated warranty for the Qualified Improvements;
and
f. Not process any PACE Assessments against the property owner until the Qualifying
Improvements on that property have received a Certificate of Completion from
Collier County; and
g. Not be used to finance residential solar panel projects.
(4) Documents: Within 10 business days following written request by the County, the PACE
Provider shall provide the County at no cost to the County any and all requested records
including , but not limited to, construction, financial, correspondence, instructions, memoranda,
bid estimate sheets, proposal documentation, back charge documentation, canceled checks,
reports, customers property status of improvements, disbursements, and all other related records
produced and maintained by the PACE District, it’s employees, contractors, and consultants.
Records shall be deemed as public records in accordance with section 119.01 Florida Statute,
General State Policy on Public Records.
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SECTION FOUR: Penalty for Violations
Violation of any provision of this Ordinance shall be punishable by a fine not exceeding
$500. All violations of this Ordinance may be processed according to the Collier County
Consolidated Code Enforcement Ordinance (Ord. No. 2010-04, as amended) and per provisions
of Chapter 162, pts. I or II, Florida Statutes, as may be applicable. In addition to the imposition
of a fine, based upon a finding of a violation either of this Ordinance or the PACE Statute by the
Code Enforcement Board or Special Magistrate, the Board may direct the Collier County Tax
Collector to remove the PACE Assessment from the property which is the subject of the
violation, and may immediately terminate for cause the Standard Membership Agreement.
SECTION FIVE: Conflict and Severability
In the event this Ordinance conflicts with any other ordinance of Collier County or other
applicable law, the more restrictive shall apply. If any phrase or portion of the Ordinance is held
invalid or unconstitutional by any court of competent jurisdiction, such portion shall be deemed a
separate, distinct and independent provision and such holding shall not affect the validity of the
remaining portion.
SECTION SIX: Inclusion in the Code of Laws and Ordinances
The provisions of this Ordinance shall become and be made a part of the Code of Laws and
Ordinances of Collier County, Florida. The sections of the Ordinances may be renumbered or
relettered to accomplish such, and the word "ordinance" may be changed to "section," "article," or
any other appropriate word.
SECTION SEVEN: Effective Date
This Ordinance shall become effective upon receipt of notice from the Secretary of State
that this Ordinance has been filed with the Secretary of State.
PASSED AND DULY ADOPTED by the Board of County Commissioners of Collier
County, Florida, this _______ day of _____________________, 2019.
ATTEST: BOARD OF COUNTY COMMISSIONERS
CRYSTAL K. KINZEL, Clerk COLLIER COUNTY, FLORIDA
By: ___________________________ By: _____________________________
, Deputy Clerk W. L. McDaniel, Jr., Chairman
Approved as to form and legality:
_______________________________
Jeffrey A. Klatzkow, County Attorney
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Packet Pg. 208 Attachment: Ordinance PACE Consumer Protection - Final (JCF_v7) (9020 : **PACE Program Modification)
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Collier County – Residential PACE Program Disclosure
______ Initials
PROPERTY ASSESSMENT CLEAN ENERGY (PACE)
PROGRAM RESIDENTIAL CUSTOMER DISCLOSURE
AGREEMENT
This form must be initialed, signed, and notarized before
being filed with Collier County for review and approval prior
to the execution of the PACE Financing Agreement The review
process will include, at a minimum, a discussion with the
applicant, which may be by telephone, to ensure that the
applicant is aware of the Program’s requirements and to
answer any questions by the applicant.
THINGS YOU SHOULD KNOW ABOUT PARTICIPATING IN THE RESIDENTIAL
PROPERTY ASSESSED CLEAN ENERGY (PACE) PROGRAM
What is the Residential PACE program?
PACE or Property Assessed Clean Energy Program is a government sponsored
program that is used in Florida to finance energy efficiency improvements,
renewable energy improvements and wind resistance improvements.
Is the PACE program free for me?
The PACE Program is not free. To participate in the program, you must qualify for
the PACE funds that finance the improvements. You owe the amount of the PACE
lien plus interest, which is paid in installments as an additional line item on your
property tax bill. When the assessment is paid off in full, the lien will be removed,
and you will no longer see this line item on your property tax bill.
9.B.2
Packet Pg. 209 Attachment: PACE program - Customer Disclosure Agreement Final (JFv5) (003) (9020 : **PACE Program Modification)
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Collier County – Residential PACE Program Disclosure
______ Initials
How do I qualify for the financing?
The law requires that to qualify you must have paid all your property taxes and not
have been delinquent for the last 3 years, that there are no involuntary liens on
your home and no notices to default and that you are current on your mortgage.
The PACE Program is not required to look at whether your family budget can afford
the additional loan.
How do I repay the PACE funds?
The PACE Program funds are paid with your property tax assessment. If you have a
mortgage, your lender may include the property taxes in your monthly payment. If
so, your monthly mortgage payment will increase accordingly. However, your
mortgage lender will typically not make the adjustment until they receive the first
tax bill with the assessment.
Do I pay interest for the financing?
PACE Programs charge interest over the repayment term you selected (up to 30
years). Please review the Financing Estimate to see the interest rate applicable to
your PACE assessment, which may be higher than other financing options available
to you. You should ask about any low interest loans available, like utility sponsored
programs, federal weatherization programs or a lower rate loan at your bank or
credit union with a second mortgage or a home equity line of credit.
Are there other costs?
PACE Program assessments also charge borrowers an up-front free, typically based
on a percentage of project costs, and an administration fee based on a percentage
of the annual payment, which is payable each year during the repayment term you
selected. Please review the Financing Estimate to see the fees application to your
PACE assessment.
What happens If I am not happy with the improvements?
A licensed contractor must do all PACE program improvements requiring a license
under applicable law. However, your recourse against the contractor if you are not
happy with the improvements may be limited by the nature of the PACE Program
financing. That is why it is important to carefully select the contractor and read all
paperwork carefully.
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Packet Pg. 210 Attachment: PACE program - Customer Disclosure Agreement Final (JFv5) (003) (9020 : **PACE Program Modification)
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Collier County – Residential PACE Program Disclosure
______ Initials
For energy improvements, does the contractor have to give me an energy audit?
The law does require any verification of energy savings for improvements to your
home from a PACE Program loan. Any figures about energy savings given to you
by a contractor would need to be independently verified by you.
What happens if I have trouble making the increased tax payment?
If you default on your PACE Program loan by failing to pay your property taxes, a
tax certificate will be sold on the property. After two years of an unpaid tax
certificate, your home could be sold through the Tax Deed Application process.
Failure to pay your PACE assessment can result in your losing your home.
Can I refinance my home while I still am making payments on my PACE Program
Loan?
PACE Program loans may impede your ability to refinance your home loan or to
receive a home loan modification because some lenders will not want to enter into
a new loan terms while a PACE Program loan is assessed against your home. You
may be required to prepay PACE assessment as a requirement to refinancing.
Can I sell my home before I have paid off the PACE Program loan?
The PACE Program lien is automatically transferred to the buyer when you sell your
home. BUT Fannie Mae, Freddie Mac, the Federal Housing Administration and the
Department of Veterans Affairs may not insure mortgages with PACE assessments.
Other lenders are not required to accept PACE Program liens. As a result, you may
be required to prepay the PACE assessment as a requirement to selling your home.
What is the most important thing I can do to protect myself?
1. Take your time before you sign any documentation.
2. Ask for and read all documentation relating to a PACE Program financing.
3. Get multiple estimates from licensed and insured contractors, other County
approved PACE Program providers, and financial lenders to ensure that you
are receiving the most competitive prices and the best value.
4. Make sure that your contractor acquires all necessary permits from the
County, a Certificate of Completion from the County after the project is
completed, and the project is signed off to your satisfaction.
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Packet Pg. 211 Attachment: PACE program - Customer Disclosure Agreement Final (JFv5) (003) (9020 : **PACE Program Modification)
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Collier County – Residential PACE Program Disclosure
______ Initials
5. Make sure that your contractor files a Notice of Commencement signed by
you and filed with the Collier County Clerk of Courts.
6. Make sure that you ask for a printed copy of all documentation and
warranties.
7. Do not sign anything that you do not understand.
MAKE SURE YOU ASK FOR A PRINTED COPY OF ALL DOCUMENTS TO READ
BEFORE YOU ALLOW ANYONE TO WORK ON YOUR HOME.
KNOW BEFORE YOU OWE
Please fill out the following:
Full Legal Name: _____________________________________________________
Phone Number: Area Code ( ) _____ - ________
Physical Address: ____________________________________________________
Parcel Number: _____________________________________________________
Estimated Annual Payment: $ _____________________________
(Cannot exceed 4% of the total annual gross income of the property owner in the
prior calendar or fiscal year)
Total Assessment Amount: $ ____________________________
(Includes financing amount, interest charges and fees)
Total Length of Assessment in Years: _____________
(Cannot exceed the manufactures original stated warranty)
Estimated Tax Year First Payment Due: ___________________________
Annual Tax with PACE Assessment payment: ___________________________
(Cannot exceed 5% of the property’s fair market value as determined by the
Collier County Property Appraiser at time of financing)
9.B.2
Packet Pg. 212 Attachment: PACE program - Customer Disclosure Agreement Final (JFv5) (003) (9020 : **PACE Program Modification)
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Collier County – Residential PACE Program Disclosure
______ Initials
I have read the above and I understand the information provided to me. I also
understand there are other financing options possibly available and this is not a
free program. I also acknowledge there are other PACE contractors and PACE
providers I may choose from.
Signature: ___________________________________________ (Property Owner)
Signature: ___________________________________________ (Property Owner)
Signature: ___________________________________________ (Property Owner)
Signature: ___________________________________________ (Property Owner)
-------------------------------------------------------------------------------------------------------------
State of Florida, County of Collier
The foregoing instrument was acknowledged before me this ________ day of
_____________________, 20______.
by ___________________________________________________________ and
__________________________________________________ (Property owner(s))
☐ Personally Known to me
☐ Has produced identification _______________________
Notary Signature: __________________________________ Seal
Entire package must be submitted for review and processing Collier County Representative: ___________________ _________________________ Y - N (circle one)
Date received Printed Name Approval
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Packet Pg. 213 Attachment: PACE program - Customer Disclosure Agreement Final (JFv5) (003) (9020 : **PACE Program Modification)
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Packet Pg. 214 Attachment: Legal Ad - PACE - 5-31-19 (9020 : **PACE Program Modification)