[HISTORY: Adopted by the City Council of the City of Auburn
as indicated in article histories. Amendments noted where applicable.]
[Adopted 8-18-2022 by L.L. No. 2-2022]
The economic development programs as established in this chapter
are designed to foster growth of industry and commercial development
within the City of Auburn. Although the City of Auburn employs a professional
planning staff whose mission, in part, is to aid in economic development,
the City Council recognizes that the federal and state governments
often take a leadership role in economic development. Due to the principles
of federalism and home rule, it is occasionally required that a municipality
adopt a local law in order to allow residents and property owners
access these federal and state programs.
[Adopted 8-18-2022 by L.L. No. 2-2022]
A.
It is the policy of both the City of Auburn and the State of New
York (the "state") to achieve energy efficiency and renewable energy
improvements, reduce greenhouse gas emissions, mitigate the effect
of global climate change, and advance a clean energy economy. The
City of Auburn finds that it can fulfill this policy by providing
property assessed clean energy financing to qualified property owners
(as defined below) for the installation of renewable energy systems
and energy efficiency measures. This article establishes a program
that will allow the Energy Improvement Corporation (as defined below,
"EIC"), a local development corporation, acting on behalf of the City
of Auburn pursuant to the municipal agreement (the "municipal agreement")
to be entered into between the City of Auburn and EIC, to make funds
available to qualified property owners that will be repaid through
charges on the real properties benefited by such funds, thereby fulfilling
the purposes of this article and accomplishing an important public
purpose. This article provides a method of implementing the public
policies expressed by, and exercising the authority provided by, Article
5-L of the General Municipal Law (as defined below, the "enabling
act").
B.
The City of Auburn is authorized to execute, deliver and perform
the municipal agreement and otherwise to implement this Energize NY
Open C-PACE Financing Program pursuant to the Constitution and laws
of New York, including particularly Article IX of the Constitution,
Section 10 of the Municipal Home Rule Law, the enabling act and this
article.
C.
This article, which is adopted pursuant to Section 10 of the Municipal
Home Rule Law and the enabling act shall be known and may be cited
as the "Energize NY Open C-PACE Local Law."
D.
Capitalized terms used but not defined herein have the meanings assigned
in the enabling act.
For purposes of this article, and unless otherwise expressly
stated or unless the context requires, the following terms shall have
the meanings indicated:
Shall have the meaning assigned in § 151-9B.
Shall have the meaning assigned in § 151-9B.
The New York State Energy Research and Development Authority.
Shall have the meaning assigned in § 151-4A.
Qualified property for which the qualified property owner
has entered into a finance agreement for a qualified project.
The owner of record of a benefited property.
A City of the state constituting a tax district as defined
in Section 1102 of the RPTL of the state.
The Energy Improvement Corporation, a local development corporation,
duly organized under Section 1411 of the Not-For-Profit Corporation
Law of the state, authorized hereby on behalf of the City of Auburn
to implement the program by providing funds to qualified property
owners and providing for repayment of such funds from money collected
by or on behalf of the City of Auburn as a charge to be levied on
the real property.
Costs incurred by the benefited property owner in connection
with a qualified project and the related finance agreement, including
application fees, EIC's program administration fee, closing costs
and fees, title and appraisal fees, professionals' fees, permits,
fees for design and drawings and any other related fees, expenses
and costs, in each case as approved by EIC and the financing party
under the finance agreement.
Article 5-L of the General Municipal Law of the State, or
a successor law, as in effect from time to time.
The finance agreement described in § 151-7A of this article.
All charges, fees and expenses related to the loan under
the finance agreement including accrued interest, capitalized interest,
prepayment premiums, and penalties as a result of a default or late
payment and costs and reasonable attorneys' fees incurred by
the financing party as a result of a foreclosure or other legal proceeding
brought against the benefited property to enforce any delinquent annual
installment liens.
Third party capital providers approved by EIC to provide
financing to qualified property owners or other financial support
to the program which have entered into separate agreements with EIC
to administer the program in the City of Auburn.
A lien on qualified property which secures the obligation
to pay real property taxes, municipal charges, or governmentally imposed
assessments in respect of services or benefits to a qualified property.
A lien on qualified property which secures any obligation
other than the obligation to pay real property taxes, municipal charges,
or governmentally imposed assessments in respect of services or benefits
to a qualified property owner or qualified property.
The Energize NY Open C-PACE Financing Program authorized
hereby.
The acquisition, construction, reconstruction or equipping
of energy efficiency improvements or renewable energy systems or other
projects authorized under the enabling act on a qualified property,
together with a related energy audit, renewable energy system feasibility
study and/or other requirements under or pursuant to the enabling
act, with funds provided in whole or in part by financing parties
under the program to achieve the purposes of the enabling act.
Any real property other than a residential building containing
less than three dwelling units, which is within the boundaries of
the City of Auburn that has been determined to be eligible to participate
in the Program under the procedures for eligibility set forth under
this article and the enabling act and has become the site of a qualified
project.
The owner of record of qualified property which has been
determined by EIC to meet the requirements for participation in the
Program as an owner, and any transferee owner of such qualified property.
The Real Property Tax Law of the state, as amended from time
to time.
As of any date, the aggregate amount of principal loaned to the qualified property owner for a qualified project, together with eligible costs and financing charges, as provided herein or in the finance agreement, as reduced pursuant to § 151-9C.
The State of New York.
A.
An Energize NY Open C-PACE Financing Program is hereby established
by the City of Auburn, whereby EIC acting on its behalf pursuant to
the municipal agreement, may arrange for the provision of funds by
financing parties to qualified property owners in accordance with
the enabling act and the procedures set forth under this article,
to finance the acquisition, construction, reconstruction, and installation
of qualified projects and eligible costs and financing charges approved
by EIC and by the financing party under the finance agreement. EIC,
on behalf of the City of Auburn, and with the consent of the benefited
property owner, will record a benefit assessment lien on the benefited
property in the secured amount (the "benefit assessment lien") on
the land records for the City of Auburn. Such recording shall be exempt
from any charge, mortgage recording tax or other fee in the same manner
as if recorded by the City of Auburn.
B.
Before a qualified property owner and a financing party enter into
a finance agreement which results in a loan to finance a qualified
project, repayment of which is secured by a benefit assessment lien,
a written consent from each existing mortgage holder of the qualified
property shall be obtained, permitting the benefit assessment lien
and each annual installment lien to take priority over all existing
mortgages.
A.
Any property owner in the City of Auburn may submit an application
to EIC on such forms as have been prepared by EIC and made available
to property owners on the website of EIC and at the City of Auburn's
offices.
B.
Every application submitted by a property owner shall be reviewed by EIC, acting on behalf of the City of Auburn, which shall make a positive or negative determination on such application based upon the criteria enumerated in the enabling act and § 151-6 of this article. EIC may also request further information from the property owner where necessary to aid in its determination.
Upon the submission of an application, EIC, acting on behalf
of the City of Auburn, shall make a positive or negative determination
on such application based upon the following criteria for the making
of a financing:
A.
The property owner may not be in bankruptcy and the property may
not constitute property subject to any pending bankruptcy proceeding;
B.
The amount financed under the program shall be repaid over a term
not to exceed the weighted average of the useful life of renewable
energy systems and energy efficiency improvements to be installed
on the property as determined by EIC;
C.
Sufficient funds are available from financing parties to provide
financing to the property owner;
D.
The property owner is current in payments on any existing mortgage
on the qualified property;
E.
The property owner is current in payments on any real property taxes
on the qualified property; and
F.
Such additional criteria, not inconsistent with the criteria set
forth above, as the state, the City of Auburn, or EIC acting on its
behalf, or other financing parties may set from time to time.
A.
A qualified property owner may participate in the program through
the execution of a finance agreement made by and between the qualified
property owner and a financing party, to which EIC, on behalf of the
City of Auburn, shall be a third-party beneficiary (the "finance agreement").
Upon execution and delivery of the finance agreement, the property
that is the subject of the finance agreement shall be deemed a "benefited
property."
B.
Upon execution and delivery of the finance agreement, the benefited
property owner shall be eligible to receive funds from the financing
party for the acquisition, construction, and installation of a qualified
project, together with eligible costs and financing charges approved
by EIC and by the financing party, provided the requirements of the
enabling act, the municipal agreement and this article have been met.
C.
The finance agreement shall include the terms and conditions of repayment
of the secured amount and the annual installment amounts.
D.
EIC may charge fees to offset the costs of administering the program
and such fees, if not paid by the financing party, shall be added
to the secured amount.
The finance agreement shall set forth the terms and conditions
of repayment in accordance with the following:
A.
The principal amount of the funds loaned to the benefited property
owner for the qualified project, together with eligible costs and
financing charges approved by EIC and by the financing party, shall
be specially assessed against the benefited property and will be evidenced
by a benefit assessment lien recorded against the benefited property
on the land records on which liens are recorded for properties within
the City of Auburn. The special benefit assessment shall constitute
a "charge" within the meaning of the enabling act and shall be collected
in annual installments in the amounts certified by the financing party
in a schedule provided at closing and made part of the benefit assessment
lien. Said amount shall be annually levied, billed and collected by
EIC, on behalf of the City of Auburn, and shall be paid to the financing
party as provided in the finance agreement.
B.
The term of such repayment shall be determined at the time the finance
agreement is executed by the benefited property owner and the financing
party, not to exceed the weighted average of the useful life of the
systems and improvements as determined by EIC, acting on behalf of
the City of Auburn.
C.
The rate of interest for the secured amount shall be fixed by the
financing party in conjunction with EIC, acting on behalf of the City
of Auburn, as provided in the finance agreement.
A.
Upon the making of the loan pursuant to the finance agreement, the
secured amount shall become a special benefit assessment lien on the
benefited property in favor of the City of Auburn. The amount of the
benefit assessment lien shall be the secured amount. Evidence of the
benefit assessment lien shall be secorded by EIC, on behalf of the
City of Auburn, in the land records for properties in the City of
Auburn. Such recording shall be exempt from any charge, mortgage recording
tax or other fee in the same manner as if recorded by the City of
Auburn. The benefit assessment lien shall not be foreclosed upon by
or otherwise enforced by the City of Auburn.
B.
The finance agreement shall provide for the repayment of the Secured
amount in installments made at least annually, as provided in a schedule
attached to the benefit assessment lien (the "annual installment amount").
The annual installment amount shall be levied by EIC, on behalf of
the City of Auburn, on the benefited property in the same manner as
levies for municipal charges, shall become a lien on the benefited
property as of the first day of January of the fiscal year for which
levied (the "annual installment lien") and shall remain a lien until
paid. The creation or any recording of the annual installment lien
shall be exempt from any charge, mortgage recording tax or other fee
in the same manner as if recorded by the City of Auburn. Payment to
the financing party shall be considered payment for this purpose.
Such payment shall partly or wholly discharge the annual installment
lien. Delinquent annual installment amounts may accrue financing charges
as may be provided in the finance agreement. Any additional financing
charges imposed by the financing party pursuant to the finance agreement
shall increase the annual installment amount and the annual installment
lien for the year in which such overdue payments were first due.
C.
The benefit assessment lien shall be reduced annually by the amount
of each annual installment lien when each annual installment lien
becomes a lien. Each annual installment lien shall be subordinate
to all municipal liens, whether created by Section 902 of the RPTL
or by any other state or local law. No portion of a secured amount
shall be recovered by the City of Auburn, EIC, or an assignee upon
foreclosure, sale or other disposition of the benefited property unless
and until all municipal liens are fully discharged. Each annual installment
lien, however, shall have priority over all nonmunicipal liens, irrespective
of when created, except as otherwise required by law.
D.
Neither the benefit assessment lien nor any annual installment lien
shall be extinguished or accelerated in the event of a default or
bankruptcy of the benefited property owner. Each annual installment
amount shall be considered a charge upon the benefited property and
shall be collected by EIC, on behalf of the City of Auburn, at the
same time and in the same manner as real property taxes or municipal
charges. Each annual installment lien shall remain a lien until paid.
Amounts collected in respect of an annual installment lien shall be
remitted to EIC, on behalf of the City of Auburn, or the financing
party, as may be provided in the finance agreement.
E.
EIC shall act as the City of Auburn's agent in collection of
the annual installment amounts. If any benefited property owner fails
to pay an annual installment amount, the financing party may redeem
the benefited property by paying the amount of all unpaid municipal
liens thereon, and thereafter shall have the right to collect any
amounts in respect of an annual installment lien by foreclosure or
any other remedy available at law. Any foreclosure shall not affect
any subsequent annual installment liens.
F.
EIC, on behalf of the City of Auburn, may sell or assign for consideration
any and all benefit assessment liens and annual installment liens
to financing parties that provide financing to qualified properties
pursuant to finance agreements. The financing parties may sell or
assign for consideration any and all benefit assessment liens and
annual installment liens received from EIC, on behalf of the City
of Auburn, subject to certain conditions provided in the administration
agreement between EIC and the financing party. The assignee or assignees
of such benefit assessment liens and annual installment liens shall
have and possess the same powers and rights at law or in equity as
the City of Auburn would have had if the benefit assessment lien and
the annual installment liens had not been assigned with regard to
the precedence and priority of such lien, the accrual of interest
and the fees and expenses of collection.
EIC, on behalf of the City of Auburn, shall verify and report
on the installation and performance of renewable energy systems and
energy efficiency improvements financed by the program in such form
and manner as the authority may establish.
If any clause, sentence, paragraph, section, or part of this
article shall be adjudged by any court of competent jurisdiction to
be invalid, such judgment shall not affect, impair or invalidate the
remainder thereof, but shall be confined in its operation to the clause,
sentence, paragraph, section, or part thereof involved in the controversy
in which such judgment shall have been rendered.
This article shall take effect upon filing with the Secretary
of State.
