Friday, May 8, 2009

For Real Estate and Municipal Practitioners

The following language is from H. 446, an act relating to renewable energy and energy efficiency. The assessment contemplated in a clean energy assessment district is something title examiners and municipal attorneys will need to be prepared to deal with.

Subchapter 2. Clean Energy Assessments
§ 3261. CLEAN ENERGY ASSESSMENT DISTRICTS; APPROVAL OF
VOTERS
(a) The legislative body of a town, city, or incorporated village may submit
to the voters of the municipality the question of whether to designate the
municipality as a clean energy assessment district. In a clean energy
assessment district, only those property owners who have entered into written
agreements with the municipality under section 3262 of this title would be
subject to a special assessment, as set forth in section 3255 of this title.
(b) Upon a vote of approval by a majority of the qualified voters of the
municipality voting at an annual or special meeting duly warned for that
purpose, the municipality may incur indebtedness for or otherwise finance
projects relating to renewable energy, as defined in subdivision 8002(2) of
Title 30, or to eligible projects relating to energy efficiency as defined by
section 3267 of this title, undertaken by owners of real property within the
boundaries of the town, city, or incorporated village.
§ 3262. WRITTEN AGREEMENTS; CONSENT OF PROPERTY OWNERS;
ENERGY SAVINGS ANALYSIS
(a) Upon an affirmative vote made pursuant to section 3261 of this title and
the performance of an energy savings analysis pursuant to subsection (b) of
this section, an owner of real property within the boundaries of a clean energy
assessment district may enter into a written agreement with the municipality
that shall constitute the owner’s consent to be subject to a special assessment,
as set forth in section 3255 of this title. A participating municipality shall
follow underwriting criteria, consistent with responsible underwriting and
credit standards as established by the department of banking, insurance,
securities, and health care administration, and shall establish other qualifying
criteria to provide an adequate level of assurance that property owners will
have the ability to meet assessment payment obligations. A participating
municipality shall refuse to enter into a written agreement with a property
owner who fails to meet the underwriting or other qualifying criteria.
(b) Prior to entering into a written agreement, a property owner shall have
an analysis performed to quantify the project costs and energy savings and
estimated carbon impacts of the proposed energy improvements, including an
annual cash-flow analysis. This analysis shall be conducted by the entities
appointed as energy efficiency utilities under subdivision 209(d)(2) of Title 30,
or conducted by another entity deemed qualified by the participating
municipality. All analyses shall be reviewed and approved by the entities
appointed as energy efficiency utilities.
(c) A written agreement shall provide that:
(1) the length of time allowed for the property owner to repay the
assessment shall not exceed the life expectancy of the project. In instances
where multiple projects have been installed, the length of time shall not exceed
the average lifetime of all projects, weighted by cost. Lifetimes of projects
shall be determined by the entities appointed as energy efficiency utilities
under subdivision 209(d)(2) of Title 30 or another qualified technical entity
designated by a participating municipality;
(2) At the time of a transfer of property ownership excepting
foreclosure, the past due balances of any special assessment under this
subchapter shall be due for payment, but future payments shall continue as a
lien on the property.
(3) A participating municipality shall disclose to participating property
owners the risks associated with participating in the program, including risks
related to the failure of participating property owners to make payments and
the risk of foreclosure.
(d) A written agreement and the analysis performed pursuant to subsection
(b) of this section shall be filed with the clerk of the municipality for recording
in the land records of the municipality and shall be disclosed to potential
buyers prior to transfer of property of ownership. Personal financial
information provided to a municipality by a participating property owner or
potential participating property owner shall not be subject to disclosure as set
forth in subdivision 317(c)(7) of Title 1.
(e) At least 30 days prior to entering into a written agreement, the property
owner shall provide to the holders of any existing mortgages on the property
notice of his or her intent to enter into the written agreement.
(f) The total amount of assessments under this subchapter shall not exceed
more than 15 percent of the assessed value of the property. The combined
amount of the assessment plus any outstanding mortgage obligations for the
property shall not exceed 90 percent of the assessed value of that property.
(g) In the case of an agreement with the resident owner of a dwelling, as
defined in section 103(v) of the federal Truth in Lending Act:
(1) the assessments to be repaid under the agreement, when calculated
as the repayment of a loan, shall not violate chapter 4 of Title 9;
(2) the maximum length of time for the owner to repay the loan shall not
exceed 20 years; and
(3) the maximum amount to be repaid for the project shall not exceed
$30,000.00 or 15 percent of the assessed value of the property, whichever is
less.
§ 3263. COSTS OF OPERATION OF DISTRICT
The owners of real property who have entered into written agreements with
the municipality under section 3262 of this title shall be obligated to cover the
costs of operating the district. A municipality may use other available funds to
operate the district.
§ 3264. RIGHTS OF PROPERTY OWNERS
A property owner who has entered into a written agreement with the
municipality under section 3262 of this title may enter into a private agreement
for the installation or construction of a project relating to renewable energy, as
defined in subdivision 8002(2) of Title 30, or relating to energy efficiency as
defined by section 3267 of this title.
§ 3265. LIABILITY OF MUNICIPALITY
(a) A municipality that incurs indebtedness for or otherwise finances
projects under this subchapter shall not be liable for the failure of performance
of a project.
(b) A municipality that incurs indebtedness for bonding under this
subchapter shall pledge the full faith and credit of the municipality.
§ 3266. INTERMUNICIPAL AGREEMENTS
Two or more municipalities, by resolution of their respective legislative
bodies or boards, may establish and enter into agreements for incurring
indebtedness or otherwise financing projects under this subchapter.
§ 3267. ELIGIBLE ENERGY EFFICIENCY PROJECTS
Those entities appointed as energy efficiency utilities under subsection
209(d) of Title 30 shall develop a list of eligible energy efficiency projects and
shall make the list available to the public on or before July 1 of each year.
§ 3268. RELEASE OF LIEN
(a) A municipality shall release a participating property owner of the lien
on the property against which the assessment under this subchapter is made
upon:
(1) Full payment of the value of the assessment; or
(2) Demand from a party who has filed an action for foreclosure on a
participating property.
(b) If a municipality releases a participating property owner of a lien upon
demand from a party who has filed an action for foreclosure and the
participating property owner redeems the property, the municipality shall
reinstate the lien on the property against which the assessment under this
subchapter is made.
(c) Notice of the release or reinstatement of the lien shall be filed with the
clerk of the municipality for recording in the land records of the municipality.
§ 3269. RESERVE FUND
(a) A participating municipality may create a reserve fund for use in the
event of a foreclosure upon an assessed property. The reserve fund shall be
funded by participating property owners at a level sufficient to provide for the
payment of any past due balances on assessments under this subchapter and
any remaining principal balances on those assessments in the event of a
foreclosure upon a participating property.
(b) The reserve fund shall be capitalized in accordance with standards and
procedures approved by the commissioner of banking, insurance, securities,
and health care administration to cover expected foreclosures based on good
lending practice experience.
(c) The municipality shall disclose in advance to each interested property
owner the amount of that property owner’s required payment into the reserve
fund. Once disclosed, the amount of the reserve fund payment shall not
change over the life of the assessment.
Sec. 15k. 24 V.S.A. § 4592 is amended to read:
§ 4592. SUPPLEMENTARY POWERS
The bank, in addition to any other powers granted in this chapter, has the
following powers:
* * *
(8) To the extent permitted under its contracts with the holders of bonds
or notes of the bank, to consent to any modification of the rate of interest, time
and payment of any installment of principal or interest, security or any other
term of bond or note, contract or agreement of any kind to which the bank is a
party; and
(9) To issue its bonds or notes which are secured by neither the reserve
fund nor the revenue bond reserve fund, but which may be secured by such
other funds and accounts as may be authorized by the bank from time to time;
(10) To issue bonds, other forms of indebtedness, or other financing
obligations for projects relating to renewable energy, as defined in subdivision
8002(2) of Title 30, or to energy efficiency projects under subchapter 2 of
chapter 87 of this title. Bonds shall be supported by both the general
obligation and the assessment payment revenues of the participating
municipality.

Municipal filing fees are increasing on July 1, 2009 from the current $8 per page to $10. the following is from the executive branch fee bill, H. 136:

* * * Municipal Clerks * * *
Sec. 21 . 32 V.S.A. § 1671(a) is amended to read:
(a) For the purposes of this section a “page” is defined as a single side of a
leaf of paper on which is printed, written, or otherwise placed information to
be recorded or filed. The maximum covered area on a page shall be 71/2
inches by 14 inches. All letters shall be at least one-sixteenth inch in height or
in at least eight point type. Unless otherwise provided by law, the fees to town
clerks shall be as follows:
(1) For recording a trust mortgage deed as provided in section 1155 of
Title 24, $10.00 per page;
(2) For filing or recording a copy of a complaint to foreclose a mortgage
as provided in subsection 4523(b) of Title 12, $10.00 per page;
* * *
(6) Notwithstanding any other provision of law to the contrary, for the
recording or filing, or both, of any document that is to become a matter of
public record in the town clerk’s office, or for any certified copy of such
document, a fee of $10.00 per page shall be charged; except that for the
recording or filing, or both, of a property transfer return, a fee of $10.00
shall be charged;
* * *
(8) For survey plats filed in accordance with chapter 17 of Title 27, a fee
of $6.00 $15.00 per 11 inch by 17 inch sheet, $15.00 per 18 inch by 24
inch sheet, and $15.00 per 24 inch by 36 inch sheet shall be charged.
Sec. 22. 32 V.S.A. § 9606(d) is amended to read:
(d) For receiving a property transfer return and tax payment, if any, under
this chapter, there shall be paid to the town clerk at the time of filing a fee of
$10.00.

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