TRAVERSE CITY — Funding renewable energy projects can be a challenge.
The projects can take more than 15 years pay back investments, said Black Star Farms' Chief Financial Officer Michael Lahti, and traditional lenders usually want returns in five to seven years.
"One of the hardest things to do on a green energy project is be cash-flow positive on day one," he said.
Lahti once considered seeking a long-term loan to pay for solar panels at Black Star Farms. He approached the Leelanau County Board of Commissioners in July, when commissioners discussed implementing the Property Assessed Clean Energy program.
The PACE program will again land in front of commissioners at their meeting Tuesday at 9 a.m. at the Leelanau County Government Center in Suttons Bay.
PACE was adopted by the state in 2010. Local units of government have to vote to implement it because they collect paymentsas special assessments on property tax bills.
Loans still are issued by banks or credit unions, said Leelanau County Administrator Chet Janik. PACE loans stick with properties, not the person who takes out the original loan. If a property with a PACE loan sells, the next property owner would be responsible for paying back the loan.
"If I'm a banker, I can say this is a little less risky on my part so I'd be willing to stretch out the loan payment," Janik said.
Michigan allows counties to issue bonds, but they don't have to. David Stoker, a partner at the Lansing firm Cohl, Stoker & Toskey, said in a written statement to Janik that the county would have to administer and collect PACE payments, but wouldn't be financially liable for the loans.
The PACE discussion was tabled in July when some commissioners questioned the county's financial liability, said commissioner Carolyn Rentenbach. She wants to implement PACE, but doesn't want Leelanau County to offer bonds.
"That wouldn't even be an issue for us," she said.
The PACE program wasn't Lahti's only option for funding Black Star Farms' solar panels. He ended up receiving a loan for almost $50,000 from the USDA instead.
Representatives from Leelanau Studios in Greilickville and Thomas & Milliken Millwork in Northport have also shown interest in the PACE program.
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