House Bill 378 - Commercial Property Assessed Capital Expenditure Act Summary

• Establishes the Commercial Property Assessed Capital Expenditure (C-PACE) program allowing local governments to voluntarily implement financing for qualifying energy, water, and resilience improvements on commercial, industrial, agricultural, and multifamily residential properties.

• Authorizes local governments to impose voluntary special assessments on property owners who enter written contracts with the government, with assessments repaid through private capital providers rather than public funds.

• Requires property owners to obtain written consent from mortgage holders before entering C-PACE agreements and establishes debt limits of 90% of fair market value, with C-PACE assessments capped at 35% (new construction) or 25% (retrofits) of property value.

• Creates a C-PACE lien that is first and prior against the property but junior to local property taxes, runs with the land, and cannot be accelerated through foreclosure of other liens if mortgage holder consent was obtained.

• Prohibits local governments from making permits or licenses contingent on C-PACE participation and prohibits use of public funds or full faith and credit to secure C-PACE financing.

• Effective July 1, 2023.