Sustainable BC Committee

City of Battle Creek Sustainable BC Committee 150 N. Kendall St Multi-Purpose Room Battle Creek, MI Wednesday, April 1, 2015 4:00 p.m. Members Present: Kathy Antaya, Susan Anderson, Comm. Andy Helmboldt, Michael Myszka, Randall Champlin, Christine Kosmowski Members Absent: Devon Gibson, Tiffany Welsh, and Ken Kohs (retired) Others: Vicki Houser, City Clerk; Ted Dearing, Assistant City Manager Guests: Kurt Tribbett, Kelli Scott, Jim Haadsma Call to Order: Kathy Antaya called the meeting to order at 4:06 PM, noting a quorum was present. Lean & Green Michigan: PACE Presentation: Cory Connolly, Levin Energy Partners, LLC, Clean Energy Project Manager, discussed the Lean & Green Michigan program, a Property Assessed Clean Energy (PACE) program. Mr. Connolly stated the program is a result of Public Act 270 of 2010, which provides long term financing to commercial, industrial and multi-family properties for energy efficient or clean energy upgrades. Mr. Connolly stated the financing is provided through the county’s special assessment authority, stating no taxpayer money is used. Mr. Connolly informed the committee that 31 states and the District of Columbia have adopted PACE statutes since 2008. Mr. Connolly stated commercial, industrial and agricultural properties qualify, as do multi-family properties and private non-profit entities, including churches, hospitals and private schools and colleges. Mr. Connolly stated single family residences and government buildings were not eligible. Mr. Connolly stated that up to 100% of the eligible project costs could be included, namely projects for energy efficiency, water efficiency, or renewable energy improvements. The projects included on a presented list included insulation, caulking, weather stripping and air sealing, new windows or doors, energy control systems, HVAC systems, energy recovery systems, lighting fixtures and day lighting systems, electrical systems to charge PEVs and HPEVs, water use reduction or efficiency, energy efficient or water efficient manufacturing processes and equipment, Biomass, solar photovoltaics, solar thermal, wind, geothermal, methane gas captured from a landfill, and anything else approved as a “utility cost-savings measure” by a municipality participating in Lean & Green Michigan. Mr. Connolly noted incinerators and digesters were excluded. Mr. Connolly stated the Lean & Green Michigan program was initiated because most clean energy projects don’t work with traditional financing (payback>loan term). Mr. Connolly stated the Special Assessment mechanism provides more secure, longer term financing, stating the PACE special assessments are enforced by the county, and that in the event of default, the special assessment “Runs with the land,” so it moves to the new owner if the property is sold. Mr. Connolly noted PACE financing is typically 10-20 years, with a fixed interest rate, providing reduced risk for the property owner and the lender. Mr. Connolly also stated the approved contractors must guarantee energy savings on projects costing over $250,000. Mr. Connolly discussed the benefits of working with Lean & Green Michigan instead of the county creating an individual PACE district, including shared services and relationships with approved contractors and funders. Mr. Connolly stated Lean & Green Michigan was currently working with Bay, Eaton, Genesee, Grand Traverse, Huron, Ingham, Macomb, Montcalm, Saginaw, Washtenaw and Wayne counties, along with the cities of Pleasant Ridge, Rochester Hills, Royal Oak and Southfield. As to the next steps, Mr. Connolly stated the City or County would first pass a resolution of intent, then hold a public hearing, followed by a resolution of adoption, and then to start working with local businesses to develop and finance clean energy projects. 1 Kelli Scott, Calhoun County Administrator, expressed her opinion the private financing would be difficult for small businesses. Ms. Scott also asked if other municipalities were doing PACE under a different model. Mr. Connolly agreed, stating the program was intended for projects of $200,000 or more, with energy costs of $5,000-6,000 per month. Mr. Connolly stated the only other PACE model in Michigan was being done in Ann Arbor, stating local counties could adopt their own programs with their own financing, possibly issuing bonds. Mr. Connolly also suggested the county aggregate several projects together, and to issue bonds for all of the projects at one time. Mr. Connolly stated Lean & Green Michigan was also able to bundle projects for one business with several locations to get the projects to $200, 000. Ms. Scott asked if the program was limited to improvements that evidenced energy savings. Ms. Scott also asked if Kalamazoo County had approved the PACE program yet. Mr. Connolly stated the projects did not have to provide for energy savings if they were being done for energy or water efficiency, or to use clean energy. Mr. Connolly stated Kalamazoo County was expected to have a resolution of intent on the April 7, 2015 agenda. Mr. Connolly also stated they had received interest from Barry, Delta, Gratiot and Oakland Counties. Regarding qualified contractors, Mr. Connolly stated newer contractors were required to complete the program’s training, stating 75-80 companies were currently approved, noting a list of contractors was available at the Michigansaves.org website, stating Michigan Saves provided financing for smaller projects, including residential properties. Mr. Champlin asked if any counties had decided not to participate in the PACE program, asking what their concerns may be. Mr. Champlin also expressed concern the county may face foreclosure on defaulted properties. Mr. Connolly stated he is unaware of any counties that have decided not to participate in the PACE program after presentation, stating one county has tabled the issue, while some counties do take a little longer to make the decision. Mr. Connolly stated that if there is a default on the assessed property, and the property never sells, the bank will lose their investment, not the county. Mr. Connolly noted lenders will only lend 25% of the property’s value. Ms. Kosmowski asked if the program would soon be available for single family residences. Mr. Connolly stated single family residences were the biggest participants in the state of California, stating the program may eventually include lower cost projects for single family residences. Public Comment: There were no public comments. Approval of Minutes: A motion was made by Randall Chapman, supported by Mike Myszka , to approve the December 3, 2014 meeting minutes. All yes, none opposed. Motion approved. Additions or Deletions to the Agenda: Ms. Antaya recommended the removal of the report to the City Commission as Mr. Gibson was not able to attend the meeting. Ms. Antaya also recommended the removal of the Green Purchasing Policy. Comm. Helmboldt noted a Green Purchasing Policy would be incorporated into the City’s goals. Energy Efficiency Studies of City Facilities: Kurt Tribbett, Engineering Administrator, stated the City has hired a company to review energy savings for the pumps, compressors and aeration at the City’s water production plant. As to the Wastewater Treatment Plant, Mr. Tribbett stated many of the pumps were at the end of their life cycle, stating they were looking at other processes, noting the City has $1.5 million just for energy usage. Mr. Tribbett stated they were also reviewing the chemicals used in the process, noting the testing is done by hand, stating they were looking at equipment that would constantly monitor and make adjustments, stating the chemicals are also a large expense. As to road maintenance plans, Mr. Tribbett stated the City had a 15 year plan to keep them treated, noting they would be considering sewer and water main plans while completing maintenance. Ms. Anderson inquired as to energy audits for all City facilities, asking if there were any additional considerations for renewable energy use. Comm. Helmboldt informed the committee that energy audits are being considered for all City facilities, noting a current study at the Department of Public Works, also stating a comprehensive study was being done for all Fire Department facilities and consideration of a new Police Department building. Old Business: 2 1. Report to the City Commission: Removed 2. Pulver Dryer Project Update: Mr. Tribbett stated the ultimate goal of the Pulver Dryer Project was to be energy self-efficient, stating they were still in the pilot stage doing some test runs to dry the material, noting they have experienced some difficulty getting the product to dry thoroughly and to convert to pellet form. Mr. Tribbett also noted the Incinerator will be offline after March of 2016 due to EPA requirements, stating they were still looking into the end process for conversion of the material to provide energy, stating more options were being considered. 3. City Commission Update: Comm. Helmboldt informed the committee members that Environmental Stewardship would be one of the 6 City goals that would be incorporated in the City Manager’s annual evaluation, stating Senior Staff was currently working on priorities. Comm. Helmboldt invited committee members to the joint Commission/Staff meeting to provide public input on the City’s goals. 4. Green Purchasing Policy Follow-up: Postponed to next meeting. Committee Comment/Announcements Ms. Anderson discussed the Ft. Custer Climate Adaptation Planning Charrette for resilient communities, a series of meetings in Fort Custer. Ms. Anderson stated discussions she attended included what cities are doing to prepare for climate change, stating solar panels would be installed in the Fort Custer area next month, which would result in net zero usage, stating Camp Grayling was at triple net zero. Ms. Antaya felt it was good that large groups were considering potential problems and solutions to climate change. Mr. Champlin expressed his opinion it was positive that people were considering emergency preparedness, whether they believed climate change was an immediate concern or not. Ms. Antaya discussed the EfficientGov’s Roundtable, attended by herself, Mr. Tribbett and Ms. Anderson, stating a lot of forward thinking communities are considering ways to be more efficient, whether in energy efficiency or services. Ms. Kosmowski asked the committee if they felt the City or County would support a local PACE program. Mr. Champlin expressed his opinion companies will make improvements that make sense to their business, stating introducing bureaucracy into the decision was not always needed, that they should look to the most efficient means available. Mr. Myszka stated the PACE projects were geared to very large projects. Mr. Dearing stated the PACE program would provide another tool to access capital that businesses may not otherwise be able to obtain. Ms. Kosmowski requested the committee reconsider a different date for the work group meeting at Denso, stating the County was having a Placemaking seminar that same date, May 6, 2015, from 1:30 to 8:30 pm. Mr. Myszka stated he would provide an alternate date to committee members. Mr. Myszka also discussed the Governor’s goal of 30% recycling statewide, asking if Waste Management could provide data regarding the participation and quantity for the City recycling program. Mr. Tribbett agreed to contact Waste Management. Next Meeting: The next meeting of the Sustainable BC Committee is scheduled for June 3, 2015 at 4:00 pm. at the Department of Public Works in Room 204. The work group gathering will be May 13, 2015, at Denso. Adjournment: The meeting was adjourned at 5:51 PM. 3