Displayed below is a list of Frequently Asked Questions (FAQs). Click on the “>” icon associated with each question to view the answer.
Colorado Commercial Property Assessed Clean Energy (C-PACE) is a financing program for commercial, industrial, agricultural, non-profit and multifamily (with 5 or more units) properties. Colorado C-PACE enables building owners to finance 100% of eligible energy efficiency, renewable energy and water conservation improvements with repayment terms of up to 20 years.
Repayment is facilitated through the County property tax assessment process. A voluntary assessment (similar to a sewer district assessment) is placed on the building owner’s property tax bill. The assessment is repaid over the financing term (up to 20 years) and the annual energy cost savings will, in most cases, exceed the annual assessment payment. As a result such projects are typically cash flow positive in the first year. Because the C-PACE assessment obligation runs with the property, the assessment automatically transfers to the next owner when the property is sold.
Commercial, industrial, agricultural, non-profit and multifamily (with five or more units) properties are eligible to participate in the Colorado C-PACE program. Colorado C-PACE financing is only available for buildings that are located in a county that has opted to participate in the program.
In order to become eligible, C.R.S. 32-20-105(c) requires the Board of County Commissioners to adopt a resolution authorizing Colorado’s New Energy Improvement District (NEID) to conduct the Colorado C-PACE program within that county. In addition, the resolution must authorize the county to enter into the NEID-County Participation Agreement with the District. Once the county and the District sign that agreement, that county will be part of the Colorado C-PACE program, and projects located within that county may be funded using Colorado C-PACE financing.
Visit the Participating Counties page of this website for a current list of Counties participating in the Colorado C-PACE program. C-PACE may only accept Pre-Qualification Submission Forms from property owners located in counties that have joined the program by passing a simple “opt-in” resolution. Feel free to email us at firstname.lastname@example.org if you have questions about getting a non-participating county to join Colorado C-PACE.
Funding for Colorado C-PACE financing will be provided by private capital providers, which may be banks, specialty financiers, institutional investors, insurance companies or other capital providers. No state funds are anticipated to be made available for funding Colorado C-PACE projects.
Colorado C-PACE has been designed with an “open source funding model” that allows for any qualified capital provider to participate in funding eligible C-PACE projects.
In order to participate in a project funded through Colorado C-PACE, capital providers must meet eligibility criteria set forth by the program. Criteria is defined in a Capital Provider Application and Participation Agreement. Colorado C-PACE encourages capital providers to take steps toward program eligibility prior to submitting a specific project application.
Colorado C-PACE projects typically range from $200,000 to over $1.0 million. There are no C-PACE program-defined minimum or maximum project financing size limitations. Rather each participating capital provider is expected to set their own financing parameters.
Repayment of the Colorado C-PACE financing is secured by a special assessment (similar to a sewer district or business improvement district assessment) recorded in the property records of the county in which the participating property is located.
Colorado C-PACE assessment repayment is managed through a new line item on the building’s property tax bill. Typically the C-PACE assessment annual payments are less than the annual dollar value of the energy saved. As a result such projects are typically cash flow positive to the owner in the first year.
Under the Colorado C-PACE Statute (C.R.S. 32-20-101 et seq.), the C-PACE special assessment is subject to the same penalties and the same procedures (up to and including a tax lien sale) in the case of delinquency as is provided for through ad valorem (i.e. property) taxes. The C-PACE assessment has priority over all private liens on the property, is of equal priority to other special assessments, and is junior in priority to general property taxes.
Because the Colorado C-PACE assessment obligation runs with the property, the assessment automatically transfers to the next property owner if the property is sold. C-PACE assessments are billed on the property tax bill with payments due at the same time as property tax payments, thus many observers view PACE financing as less risky than commercial loans, which could generate attractive interest rates and longer terms from the private sector.
If a building owner is deficient or delinquent on their C-PACE assessment, Colorado C-PACE is not responsible to cover the shortfall. As a C-PACE assessment is associated with the property, not the building owner, in the case of a non-payment, the assessment (which is a priority lien) will fall into arrears and be repaid after all other taxes are satisfied and prior to any outstanding mortgage.
Municipal liens related to real property have first priority, followed by any Colorado C-PACE payments in arrears, followed by non-real property municipal liens and assessments, followed by the first mortgage holder.
The Colorado C-PACE program administrator will actively engage with building owners, contractors, mortgage holders and capital providers to raise program awareness. In addition, the program administrator will provide county governments (and others) with educational material, including:
- Data on eligible building types,
- Marketing material, and
- In-depth training for contractors seeking to develop projects for building owners.
The statewide Colorado C-PACE program was launched by Colorado’s New Energy Improvement District (NEID), which was created by the Colorado Legislature in 2014. In 2015 NEID, through a competitive bidding process, selected Sustainable Real Estate Solutions, Inc. (SRS) to be the Colorado C-PACE program administrator.
Visit the Participating Counties page of this website for a current list of counties participating in the C-PACE program. The program administrator can accept Pre-Qualification Submission Forms ONLY from owners with properties located in a county that has opted into the Colorado C-PACE program. If you have questions about getting any county to join Colorado C-PACE, email us at email@example.com
Repayment periods can be 10, 15, or 20 years, depending on the owner’s preference, and are limited by the weighted average effective useful life (EUL) of the financed improvements.
Property owners are encouraged to pursue available Federal Investment Tax Credits (ITC), utility rebates and any other incentives. All or a portion of total incentives may be subtracted from the amount financed under the Colorado C-PACE Program.
No. There is no fee to submit a Pre-Qualification Submission Form for Colorado C-PACE financing.
Colorado C-PACE is designed to be a self-sustaining program once a certain level of deal-flow is achieved. The Colorado Energy Office has a limited budget to ensure that the program can cover its start-up costs.
To ensure that the program fees charged to program applicants are sufficient to cover the operating costs associated with administering the program, while still allowing for attractive overall costs associated with Colorado C-PACE participation, a fee equal to 2.5% of the project finance amount (not to exceed $75,000 per project) will be assigned to each C-PACE project. In addition, to cover the County tax assessors support services, the County will levy a C-PACE assessment servicing fee of up to 1% of the PACE assessment amount.
For the billing and collection support services rendered, the county will collect a “servicing fee” (not to exceed 1% of the periodic C-PACE assessment payments) to be paid by the Property Owner over the term of the C-PACE financing in the normal course of paying their property tax bill.