What Municipal Officials Need to Know About the New Garden State C-PACE Program 

The Garden State C-PACE Program offers municipalities an innovative tool for supporting green building practices, improving energy efficiency, and boosting local economic development. By understanding the program’s key components and encouraging participation, municipal officials can help foster a more sustainable and resilient community while attracting investment in clean energy and infrastructure.

Overview of C-PACE:

The Commercial Property Assessed Clean Energy (C-PACE) program is a financing tool designed to support energy efficiency, renewable energy, and water conservation improvements in commercial properties. The New Jersey Garden State C-PACE Program provides property owners with access to low-cost, long-term financing for sustainable building upgrades. This initiative enables municipalities to foster green building practices and meet state-level sustainability goals while promoting economic growth and energy efficiency.

Key Features of the Garden State C-PACE Program:

Eligibility:

• Available for commercial, industrial, multi-family (5+ units), agricultural, and nonprofit/institutional properties such as hospitals, churches, and schools.
• Eligible improvements include energy efficiency upgrades, renewable energy installations (solar, wind, etc.), water conservation and other resiliency projects.
• Financing is available to properties and owners that meet eligibility and underwriting requirements.

Financing Terms:

• Financing is repaid through a special assessment added to the property tax bill, typically over 10 to 30 years.
• The amount financed can cover up to 100% of the cost of eligible projects.
• Long-term financing offers lower interest rates compared to traditional loans, which helps reduce upfront financial barriers for property owners.

Program Administration:

• C-PACE financing is facilitated through private capital providers, with oversight from the New Jersey Economic Development Authority (NJEDA) and participating municipalities.
• Municipalities play a key role in approving and implementing C-PACE projects by adding the assessment to the property tax roll. This ensures the repayment is collected along with property taxes.
• The top one-third of municipalities (by population) may also establish their own administration programs in conjunction with NJEDA to expedite project approvals.

Key Benefits for Municipalities:

• C-PACE Promotes Sustainability: The C-PACE program aligns with state and local sustainability goals, encouraging energy-efficient and environmentally friendly property improvements.
• Economic Development: By fostering green building practices, municipalities can enhance local property values, attract businesses, and create jobs within the green energy sector.
• No Cost to the Municipality: Municipalities are not involved in funding projects. They simply collect repayment as part of the property tax process. They may also charge specified fees for servicing the C-PACE assessment.
• Increased Resilience: The program supports retrofits that make buildings more resilient to climate impacts, improving overall community sustainability.

Municipal Responsibilities:

• Approval Process: Municipalities must approve the special assessment lien for C-PACE projects once a property owner has secured financing.
• Tax Collection: Municipalities collect repayments through the property’s tax bill and remit them to the lender.
• Outreach and Education: Local governments should actively promote the program to commercial property owners, contractors, and other stakeholders to ensure broad participation.

How to Get Started:

• Municipal officials can download documents and guidelines from NJEDA.gov/c-pace, and work with the NJEDA to understand the specific process for program enrollment, financing, and project approval.
• The introduction of a model Ordinance and Program Agreement is required and can be started immediately. The approved versions are available at NJEDA.gov/c-pace.
• Coordinating with local economic development offices and sustainability teams can help integrate C-PACE into broader community and business support initiatives. The NJPACE Alliance welcomes municipalities as important stakeholders.

NJPACE also offers interested municipalities a unique community outreach program on a cost-share basis. Contact us today for more information.