KANSAS CITY, Mo. (AP) - Kansas City leaders are hoping owners of older commercial properties will take advantage of a program that provides low-interest financing for energy upgrades.
The Property Assessed Clean Energy program, or PACE, recently helped the Wornall Plaza condominiums near the Country Club Plaza to save $34,000 annually after the property owner spent $670,000 to upgrade old boilers and lights. The savings will eventually pay for the new equipment.
Dennis Murphey, the city's chief environmental officer, said the owners can borrow 100 percent of the cost and spread the payments over 15 to 17 years.
Wornall Plaza was the first Kansas City building to use the program, which allows building owners to borrow 100 percent of the project cost and spread payments over 15 to 17 years.
Dennis Murphey, Kansas City's chief environmental officer, said business owners are generally unwilling to borrow money, but noted this program makes it worth the effort.
"It's one of the very few expenses that allows you to get a return on investment before you sell it," Murphey said. "You actually get a savings while you occupy the building."
The city affiliated with the state's Clean Energy District more than a year ago because of the benefits for businesses, the environment and job creation.
Other areas in the district include Jackson County, Independence, North Kansas City, Belton and Peculiar, which all provide ways for commercial property owners to have long-term financing for energy-efficiency and renewable energy projects through their property taxes.
Kansas City's program provides an added incentive because the city got $4.6 million in state energy conservation bonds, which allows it to help local businesses and third-party lenders with a lower interest rate - about 4 percent versus the more typical 7 percent - on loans for improvements.
The loan must be supported by an energy audit to make sure the utility savings will offset the annual repayments that are made as a special property tax assessment.
The program is not available to single-family homeowners or residents of most Kansas City condominium buildings where each condo is individually owned. But it is available for most commercial properties, offices and shopping centers and may even be cost effective even for 25- to 30-year-old buildings with outdated heating and cooling systems, lights and plumbing.
"We hope we'll see a lot more of these projects in Kansas City in the months ahead," Councilman John Sharp said.