Missouri § 67.2817 - Assessment contracts — approval criteria — insurance coverage required, when — notification by board prior to execution, when — website to be maintained.

§ 67.2817. Assessment contracts — approval criteria — insurance coverage required, when — notification by board prior to execution, when — website to be maintained.

1.  Notwithstanding any other contractual agreement to the contrary, each assessment contract shall be reviewed, approved, and executed by the clean energy development board and these duties shall not be delegated.  Any attempted delegations of these duties shall be void.

2.  An assessment contract shall not be approved, executed, submitted, or otherwise presented for recording unless a clean energy development board verifies that the following criteria are satisfied:

(1)  The PACE assessments are assessed in equal annual installments;

(2)  The PACE assessment may be paid in full at any time without prepayment penalty.  The pay-off letter shall specify the amount of any fee or charge by a lender or loan service agent to obtain the total balance due.  The release of the assessment shall be recorded within thirty days of the receipt of the amounts identified in the pay-off letter;

(3)  The assessment contract shall disclose applicable penalties, interest penalties, or late fees under the contract and describe generally the interest and penalties imposed under chapter 140 relating to the collection of delinquent property taxes;

(4)  The clean energy development board shall provide a separate statement to the owner of the residential property of the penalties or late fees authorized under the assessment contract and of the penalties and interest penalties under chapter 140 for the applicable tax collector as of the date of the assessment contract;

(5)  The clean energy development board has confirmed that the property owner is current on property taxes for the project property;

(6)  The property that shall be subject to the assessment contract has no recorded and outstanding involuntary liens in excess of one thousand dollars;

(7)  The property owner shall not currently be a party to any bankruptcy proceeding where any existing lien holder of the property is named as a creditor;

(8)  The term of the assessment contract shall not exceed the weighted average useful life of the qualified improvements to which the greatest portion of funds disbursed under the assessment contract is attributable, not to exceed twenty years.  The clean energy development board shall determine useful life for purposes of this subdivision based upon credible third-party standards or certification criteria that have been established by appropriate government agencies or nationally recognized standards and testing organizations;

(9)  The property owner is current on all mortgage debt on the subject property and has no more than one late payment during the twelve months immediately preceding the application date on any mortgage debt; and

(10)  The clean energy development board shall not enter into an assessment contract or levy or collect a special assessment for a project without making a finding that there are sufficient resources to complete the project and that the estimated economic benefit expected from the project during the financing period is equal to or greater than the cost of the project.

3.  Any assessment contract for a project that, combined with any existing and outstanding indebtedness secured by the benefitted property, results in a loan-to-value ratio between eighty percent and ninety-seven percent of the true value in money, as determined by the assessor pursuant to chapter 137, plus ten percent of such amount, of the benefitted property prior to the project as determined by reference to the assessment records for tax purposes for the most recent completed assessment by the county, or city not within a county, shall include provision of an insurance policy providing coverage for any remaining cost of fulfilling the assessment contract, including any accumulated interest, in the event the property is foreclosed upon, if such product exists.  Such insurance policy shall run with the land in the same manner as the other obligations set forth in the assessment contract.

4.  The property owner executing the PACE assessment contract shall have a three-day right to cancel the qualifying improvements proposed for financing under the PACE assessment contract.  The three-day right to cancel shall expire at midnight of the third business day after a property owner signs the assessment contract.  The clean energy development board shall be required to provide a printed form that is presented to the property owner no later than the time of signing of the assessment contract detailing the property owner's right to cancel.  An electronic form may be provided if the owner consents electronically to receiving an electronic form.

5.  Prior to the execution of an assessment contract, the clean energy development board shall advise the property owner in writing that any delinquent assessment shall be a lien on the property subject to the assessment contract and that the obligations under the PACE assessment contract continue as an obligation against the improved property if the property owner sells or refinances the property and that a purchaser or lender may require that before the owner may sell or refinance the property that the owner may be required to pay the assessment contract in full.

6.  Prior to the execution of an assessment contract, the clean energy development board shall advise the property owner in writing that if the property owner pays his or her property taxes and special assessments via a lender or loan servicer's escrow program, the special assessment will cause the owner's monthly escrow requirements to increase and increase the owner's total monthly payment to the lender or the loan servicer.  The clean energy development board shall further advise the property owner that if the special assessment results in an escrow shortage that the owner will be required to pay the shortage in a lump-sum payment or catch up the shortage over twelve months.

7.  The clean energy development board, within three days of entering an assessment contract, shall provide any holder of a first mortgage loan a copy of the assessment contract and a statement that includes a brief description of the project, the cost of the project, the annual assessment that will be levied, and the number of annual assessments.  Transmittal shall be by United States mail to the holder of the first mortgage loan of record.

8.  The clean energy development board shall maintain a public website with current information about the PACE program as the board deems appropriate to inform consumers regarding the PACE program.  The website shall list approved contractors for the PACE program.  The website shall disclose the process for property owners or their successors to request information about the assessment contract, the status of the assessment contract, and for all questions including contract information to obtain a payoff amount for the release of an assessment contract.

9.  The clean energy development board, its agents, contractor, or other third party shall not make any representation as to the income tax deductibility of an assessment.

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(L. 2021 H.B. 697)

---- end of effective  28 Aug 2021 ----

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