It’s been a rough few months around Tampa Bay for the government-sanctioned home improvement financing program known as PACE (Property Assessed Clean Energy) following an 8 On Your Side investigation of sketchy business practices.
“No industry is perfect,” said YGRENE Spokesman Joaquin McPeek, one of the PACE program loan providers.
Commissioner Outraged
Hillsborough Commissioner Les Miller says he’s outraged at our findings of sketchy contractors and massive bills for home improvements that homeowners can’t afford. He’s demanding accountability from PACE loan providers like YGRENE Energy Fund “We want to make sure those unscrupulous companies that prey on people that are less fortunate–that doesn’t happen,” Miller said.
One notorious PACE contractor that we exposed with ties to convicted swindlers, Summitwood Works LLC, has been tossed out of Pasco County and put on notice to stop deceiving homeowners in Hillsborough.
YGRENE knew about those ties a year ago but only recently severed its relationship with Summitwood after a series of investigative reports by Eight on Your Side.
Also, YGRENE and another PACE lender have just been prohibited from offering new loans in Pasco for failing to agree to loan disclosures drafted by Tax Collector Mike Fasano as a condition for doing business in Pasco under the PACE program.
“We’re continuing to work with Pasco County to come to a place where we can continue to do business and conduct business in the county,” McPeek said.
How PACE Works
PACE borrowers end up with a special assessment on their property taxes for new roofs, solar energy, air conditioning and other energy-efficient home improvements. McPeek says the average loan debt for YGRENE customers is about $22,000, and customers are happy. But we’ve seen tax assessments for $30,000-63,000 for new air conditioners, insulation and ductwork and spoken t a number of unhappy customers who regretted doing business with YGRENE and other PACE loan providers.
One homeowner in Pasco who bought new air conditioning, ductwork, insulation and a roof almost ended up with two assessments–one from YGRENE and one from another company– totaling more than $125,000 on his tax bill. That homeowner says the debt would have forced him to lose his home, but Pasco Tax Collector Mike Fasano intervened and refused to approve one of the assessments, essentially cutting the homeowner’s bill in half.
Wednesday, YGRENE representatives were scheduled to stand before Hillsborough Commissioners to explain what safeguards YGRENE has in place to protect consumers from unscrupulous contractors and loan terms consumers might not understand.
What’s Next
Instead, county consumer protection managers will later meet privately with YGRENE and three other PACE loan providers to investigate what kind of protections they have in place for consumers, how well they’re executing those protections and whether additional protections for consumers need to be in place.
One idea that’s already taking hold is a list of mandatory loan disclosures already required in Pasco County. Hillsborough may soon require the same ones to guarantee consumers know exactly what they’re signing up for when they agree to a PACE loan.
“It’s very comprehensive,” Commission Chair Sandra Murman said of Fasano’s disclosure agreement. “It spells out what PACE does and everyone–the consumer–has to sign it.”
“If they don’t sign tht form they won’t do business here,”Miller said.
Pace Pitfalls
Among the possible pitfalls of a PACE loan cited in Fasano’s disclosure is the resale of a house. Many subsidized loan programs such as HUD, FHA and VA will not approve a sale with a PACE loan in place and paying off the PACE loan early can result in a 5 percent penalty.
Hillsborough consumer protection watchdogs are supposed to return to the Hillsborough Commission with a report on PACE loan safeguards after meeting with all four providers. That’s when commissioners will decide whether policy changes are in order for the government-sanctioned PACE program.
“(They will) look at what kind of protections they have in place, what kind of policies, how they oversee their contractors, before we reach any conclusions,” Merrill said.
