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2021 SESSION
21101155DBe it enacted by the General Assembly of Virginia:
1. That § 15.2-958.3 of the Code of Virginia is amended and reenacted as follows:
§ 15.2-958.3. Financing clean energy, resiliency, and stormwater management programs.
A. Any locality may, by ordinance, authorize contracts to
provide loans for the initial acquisition and installation of clean energy,
resiliency, or stormwater management improvements with free and willing
property owners of both
existing properties and new construction. No
such loan shall be used to improve a residential dwelling that contains fewer
than five dwelling units or a residential condominium as defined in § 55.1-2000.
Such an ordinance shall include but not be limited to the
following:
1. The kinds of renewable energy production and distribution facilities, energy usage efficiency improvements, resiliency improvements, water usage efficiency improvements, or stormwater management improvements for which loans may be offered. Resiliency improvements may include mitigation of flooding or the impacts of flooding or stormwater management improvements with a preference for natural or nature-based features and living shorelines as defined in § 28.2-104.1;
2. The proposed arrangement for such loan program, including
(i) a statement concerning the source of funding that will be used to pay for
work performed pursuant to the contracts; (ii) the
interest rate and time period during which contracting
property owners would repay the loan; and (iii) the method of apportioning all
or any portion of the costs incidental to financing, administration, and
collection of the arrangement among the consenting property owners and the
locality;
3. (i) A minimum and maximum
aggregate dollar amount that may
be financed with respect to a property and (ii) if a locality or other public
body is originating the loan, a maximum aggregate dollar amount that may be financed with respect to
loans a loan
originated by the locality or other public body. If
the property owner incurred the costs of improvements to be refinanced or
reimbursed within the two years prior to the
closing date of the financing and if such improvements have been made, the
loan amount may include the total costs of the improvements to be refinanced or
reimbursed;
4. In the case of a loan program described in clause (ii) of subdivision 3, a method for setting requests from property owners for financing in priority order in the event that requests appear likely to exceed the authorization amount of the loan program. Priority shall be given to those requests from property owners who meet established income or assessed property value eligibility requirements;
5. Identification of a local official authorized to enter into contracts on behalf of the locality. A locality may contract with a third party for professional services to administer such loan program;
6. Identification of any fee that the locality intends to
impose on the property owner requesting to participate in the loan program to
offset the cost of administering the loan program. The fee may be assessed as
(i) a program application closing fee paid by the
property owner requesting to participate in the program, or (ii) a
component of the interest rate on the assessment in the written contract
between the locality and the property owner, or (iii) a combination of clauses
(i) and (ii) project application
fee; and
7. A draft contract specifying the terms and conditions proposed by the locality.
B. The locality may combine the loan payments required by the
contracts with billings for water or sewer charges, real property tax
assessments, or other billings; in such cases, the locality may establish the
order in which loan payments will be applied to the different charges. The
locality may
shall not combine its billings for loan payments required
by a contract authorized pursuant to this section with billings of another
locality or political subdivision, including an authority operating pursuant to
Chapter 51 (§ 15.2-5100 et seq.), unless such locality or political subdivision
has given its consent by duly adopted resolution or ordinance.
C. The locality shall offer private lending institutions the opportunity to participate in local loan programs established pursuant to this section.
D. In order to secure the a loan authorized pursuant to
this section, the locality shall be authorized
to may
place a voluntary special assessment lien equal in value to the loan against
any property where such clean energy systems, resiliency improvements, or
stormwater management improvements are being installed. The locality may bundle
or package said such
loans for transfer to private lenders in such
a manner that would allow allows the voluntary special
assessment liens to remain in full force to secure the loans. The placement of a voluntary special assessment
lien shall not require a new assessment of the value of the real property that
is being improved under the loan program.
E. A voluntary special assessment lien on real property other than a residential dwelling with fewer than
five dwelling units or a condominium project as defined in § 55.1-2000:
1. Shall have the same priority status as a property tax lien against real property, except that such voluntary special assessment lien shall have priority over any previously recorded mortgage or deed of trust lien only if (i) a written subordination agreement, in a form and substance acceptable to each prior lienholder in its sole and exclusive discretion, is executed by the holder of each mortgage or deed of trust lien on the property and recorded with the special assessment lien in the land records where the property is located, and (ii) evidence that the property owner is current on payments on loans secured by a mortgage or deed of trust lien on the property and on property tax payments, that the property owner is not insolvent or in bankruptcy proceedings, and that the title of the benefited property is not in dispute is submitted to the locality prior to recording of the special assessment lien;
2. Shall run with the land, and that portion of the assessment under the assessment contract that has not yet become due is not eliminated by foreclosure of a property tax lien;
3. May be enforceable by the local government in the same manner that a property tax lien against real property may be enforced by the local government. A local government shall be entitled to recover costs and expenses, including attorney fees, in a suit to collect a delinquent installment of an assessment in the same manner as in a suit to collect a delinquent property tax; and
4. May incur interest and penalties for delinquent installments of the assessment in the same manner as delinquent property taxes.
F. Prior to the enactment of an ordinance pursuant to this section, a public hearing shall be held at which interested persons may object to or inquire about the proposed loan program or any of its particulars. The public hearing shall be advertised once a week for two successive weeks in a newspaper of general circulation in the locality.
G. The Department of Mines, Minerals and Energy shall have the authority to may serve as a statewide sponsor
for a clean energy financing program that meets the requirements of this
section. The Department of Mines, Minerals and Energy shall engage a private
entity through a competitive selection process to develop and administer the
program.