When the shingles started falling off Nicole Bernhardt’s Spring Hill home, she had few options to pay for a new roof.
Bernhardt said her income dropped after a multiple sclerosis diagnosis forced her to leave her job.
Traditional financing options, such as a bank loan, were out of reach. Then she heard about the property-assessed clean energy program, commonly known as PACE, a funding option for people who don't qualify for a typical loan.
PACE loans cover storm hardening and energy-boosting home improvements like roofs, windows, and air conditioning units. Homeowners pay them off through special assessments added to their annual property tax bills.
The project would add less than $200 a month to her property taxes, but it was a 30-year commitment. Bernhardt said she figured it was the only way she could pay for a new roof. The roofer replaced her shingles in August. Two months later, the contractor notified her that the PACE lender had not paid for the work.
Bernhardt became one of dozens of homeowners caught in a legal fight between Hernando County and the PACE funding agency. According to the Insurance Journal, more than 30 Florida counties are suing the Florida PACE Funding Agency (FPFA). They claim it misleads homeowners and saddles them with large property tax bills.
Bernhardt’s roofer slapped a lien against her home after Hernando County's Tax Collector refused to attach the bill to her property taxes. That meant the lender didn't get paid, and neither did the contractor.
Bernhardt said she’s scared: “You never want to see something like this about your house.”
Hernando County's Tax Collector Sally Daniel told ABC Action News in an email.
Due to the questionable actions of one particular PACE provider, my office is involved in ongoing litigation and, therefore, cannot comment at this time. As a general matter and in order to protect property owners, my office must follow the letter of the law and may only take tax collection actions in a manner that is consistent with the law. Ultimately, the homes and property of our most vulnerable would be subject to forced sale due to non-payment of PACE assessments. We have an obligation to ensure fairness, uniformity, and accountability in the collection of taxes and assessments.
Mike Moran with the FPFA said lenders have funded half a billion dollars in home hardening improvements for more than 18,000 owners like Bernhardt who otherwise could not afford it. Moran told ABC Action News that PACE loans are "private money that comes in to finance this public purpose. And the public purpose is to be able to help these people hurricane-harden their homes.”
Pasco County Tax Collector Mike Fasano is not involved in any PACE litigation, but he sees problems with the program. “They're giving out loans to people who should not be getting them because they can they can barely pay their tax notice now.”
The projects are financed at around 10% and, depending on the amount, could add hundreds of dollars a month to a homeowner’s property bill for 10 or more years. Those who can’t afford the new higher payments risk losing their house.
A new bill passed by the House and Senate and awaiting the governor's signature would add safeguards and transparency to protect homeowners. Those safeguards include laying out all of the costs associated with the project and ensuring the homeowner can afford to pay the increased property taxes.
The litigation between FPFA and local governments, including Hillsborough, Pinellas, and Hernando counties, is ongoing. But PACE supporters say a Leon County judge's March ruling slams the door on local efforts to reject pace tax assessments. The ruling reads, "....tax collectors are without discretion to collect the non-ad valorem assessments issued by the agency."
Moran said the ruling makes it clear the tax collector must add PACE projects to the tax rolls.
But so far, Hernando, Pinellas, and Hillsborough counties have not committed to processing the special tax assessments, leaving homeowners like Bernhardt worried about the fallout and the future of their homes. “It's something that I didn't realize I was going to be put in the position of," she said. "It's not supposed to be between me and them. It's supposed to be between the lender and them.”
