SOLANA BEACH — Solana Beach is once again taking the lead in environmental sustainability. At the Jan. 14 meeting, City Council authorized staff to begin the process to develop a solar financing program, making it the first city in the county to move forward with a plan to help fund energy efficiency improvements.
The council authorized the release of a request for proposals for service, administrative support and a bond-purchase agreement. It is the first step to implementing a voluntary citywide renewable energy and energy efficient financing district, which is an environmental sustainability objective in the work plan for the current fiscal year.
The program will be designed to allow commercial and residential property owners to install electric and thermal solar systems and make energy efficiency improvements with no upfront costs.
Marty Reed, owner of Solana Beach-based Sequoia Solar, said converting a 2,500-square-foot home to solar would cost about $40,000, although federal and state rebates can reduce that amount. Under the proposed program, the city would provide initial funding through bond proceeds, which property owners would pay for over 20 years with an annual assessment on their property tax bills.
If the property is sold, the new owner would take over the payments. It is not currently known what would happen if the property goes into foreclosure, but that risk will be disclosed to investors.
“The statute doesn’t address that, so most likely it’s going to be cleared in the courts,” City Attorney Johanna Canlas said. “Since it is so new it’s unlikely that it’s going to be resolved anytime soon. It will take somebody challenging it — basically somebody defaulting on their mortgage — and a city trying to (make a) claim.”
The self-funding program will be designed to avoid any ongoing city subsidy or exposure to the general fund. Any city expenses that may be incurred are expected to be recovered through the plan.
“We need to make sure here that under no set of circumstances are we subsidizing this or exposing ourselves to some form of liability,” Councilman Tom Campbell said.
“There is no cost to the city, there are no general funds involved in this, and there’s no liability to the city,” Councilman Dave Roberts said. He and Councilwoman Lesa Heebner make up the environmental sustainability subcommittee.
About 3,900 homes and 1,200 businesses could be eligible for financing. Roberts said he has spoken with quite a few residents who are eager to take advantage of the program.
“It’s just amazing, in this community, the people that want to be able to participate in this,” Roberts said.
Solana Beach’s ability to form the financing district is a result of Assembly Bill 811, which the governor signed into law in July. It allows California cities to form assessment districts to fund the installation of permanent renewable energy sources and improvements. Although the lien will appear as a line item on tax bills, it is not considered a tax.
Palm Desert and Berkeley are the only other cities in the state that have similar programs in place. Locally, Encinitas, Chula Vista and the city and county of San Diego are developing plans, but they have not yet been voted on by the respective city councils.
“If the RFP is successful, the city would be the first in the San Diego region to make such a program available to its residents,” City Manager David Ott said.
“Several cities in the region have publically spoken about their intentions to develop such a program, but none are as far along in the process as Solana Beach,” he said.
“It’s nice to be in the forefront,” Mayor Mike Nichols said.
“I am very pleased that we are going to be the first ones,” Heebner added.
Ott said he could have a proposal ready to present to council as early as spring.