H.B. 541 Summary

• Establishes the Commercial Property Assessed Capital Expenditure (C-PACE) Act to allow local governments to voluntarily implement programs enabling property owners to finance qualifying improvements through special assessments on commercial, industrial, agricultural, and multifamily residential properties.

• Authorizes local governments to impose voluntary special assessments only with written property owner consent and mortgage holder approval; assessments become first and prior liens on the property but remain junior to property tax liens.

• Defines eligible qualified improvements as permanent installations that decrease energy/water consumption, support renewable energy production, improve resilience, or reduce lead from drinking water, with improvements installed no more than 3 years before application eligible for financing.

• Requires local governments to adopt resolutions establishing program boundaries and procedures, hold public hearings, establish eligibility criteria (including debt-to-value limits of 90% total and 35% for new construction or 25% for retrofits), and approve project applications through licensed engineering analysis.

• Prohibits local governments from conditioning permits or compelling property participation in C-PACE programs and prohibits use of public funds or full faith and credit to support the programs; effective July 1, 2024.