RISE and Shine: Virginia PACE Authority (VPA)

RISE Challenge winner VPA’s C-PACE program offers borrowers a new, cost-effective way to finance resilience improvements

RISE Resilience Innovations
6 min readJun 8, 2022

Building a resilient economy includes developing structures that can withstand the myriad symptoms of climate change. But making those necessary upgrades can be a financial challenge for businesses and property owners. RISE Challenge winner Virginia PACE Authority (VPA), a nonprofit, has stepped in to help fill the funding gap by offering borrowers an innovative, cost-effective way to pay for clean energy, environmental remediation, and resilience improvements known as C-PACE.

C-PACE provides 100% upfront capital to eligible projects and property owners who want to upgrade their buildings or reduce the cost of a new development for all multifamily and commercial properties. VPA is the C-PACE program administrator for the state of Virginia, providing a wide range of services from educating stakeholders, onboarding cities and counties, and developing program guidelines, to approving and facilitating the closing of C-PACE loans.

Abby Johnson, the executive director of VPA, says C-PACE works a lot like a traditional loan between a lender and a borrower, but it is secured by a voluntary assessment lien on the property, which makes it a public-private partnership. The assessment is requested by the borrower, and the lien is typically enforced by the locality if there is an incurable delinquency. Most of the time, payments are made at the same time as real estate taxes and the lien stays with the property when it is sold or refinanced — making it possible to have up to 30-year, fixed rate, non-recourse financing.

VPA is among the 2020 cohort of RISE Challenge winners. Johnson said that the nonprofit received $250,000, including a revenue-based loan of $105,000 to build PACEfi, a free online marketplace that enables contractors, building owners and managers, and developers to define their project needs and compare lender quotes. VPA used the remaining RISE grant money for educational outreach and the creation of a toolkit with Excel-based models to help developers analyze how C-PACE financing fits into their capital stack. The toolkit shows the relationship between equity, senior debt and mezzanine debt, and helps existing building owners compare using C-PACE to a traditional loan or their own cash.

RISE funding also contributed to two pilot projects — one in Norfolk, the other in Chesapeake — that are modeling how C-PACE can be used to make both old and new structures more resilient.

RISE funding also contributed to two pilot projects — one in Norfolk, the other in Chesapeake — that are modeling how C-PACE can be used to make both old and new structures more resilient.

“The goal is to bring clean energy and resilient financing to as many participants as we can,” Johnson says. “We’re not — at the moment, anyway — providing direct financing or loans, but we educate and do market outreach to the customers and their channel partners. So that would be like the property owners, the developers — all the private sector. We also educate the contractors who might be doing the work on these projects.”

Abby Johnson

That includes, she adds, businesses that provide technical support for things like energy audits.

C-PACE works with a variety of lenders, from commercial banks to national specialty lenders, that put money into the program to fund projects. “There are different value propositions depending on whom you’re talking to, but basically we want to make sure they understand where they can lend, what’s allowed in the program (and) spotlight them when we can,” she says.

Another part of VPA’s mission is teaching local governments the value of offering C-PACE because it provides another tool for companies to invest or reinvest in their communities and can help meet local climate goals. Johnson says that a locality can offer C-PACE financing on its own or in addition to other incentives it already has.

Johnson advocated for state legislation that lets cities like Norfolk, Chesapeake, and Virginia Beach add the C-PACE financing and resilience program to their city codes. More recently, she helped push to clarify the state statute about the kinds of resiliency improvements that can be made through the program, such as flood mitigation, living shorelines, improvements for fire or wind resistance, energy storage and more, so that more people could understand what C-PACE can do.

The PACEfi platform, developed by CleanFinancing, was created to connect property owners and developers with lenders. Users enter their basic information and receive three “soft quotes,” Johnson says. “It gives you an idea of what your cash flow would be based on what these lenders pre-entered into our system.” It’s geared toward smaller deals, she adds, or those under $1 million.

The two pilot programs in Hampton Roads showcase how C-PACE works. One is an existing, older building in Norfolk, the other is new construction in Chesapeake. VPA used some of the RISE money to pay Ecovative Energy Inc., a subcontractor, to develop an energy and resiliency analysis for a light commercial structure being built by Charlotte Loen and her father, Tim Loen of AMVET, a Chesapeake-based geothermal and drilling company.

“We’re basically doing a comprehensive site analysis to determine resilience-specific infrastructure improvements and existing aspects that could be funded through C-PACE,” says Zach Barkan, a senior consultant at Ecovative. “Specifically, we are looking at the site’s potential environmental risks of both current and future natural disasters to determine the infrastructure components that are vulnerable to these hazards and ones that will help improve the resiliency of its remaining useful life.”

Sections of the review include natural risk and flood plan assessments to understand the base flood elevation, compare it to the design flood elevation, and see what happens when sea level rise is taken into account.

There is also a general stormwater management assessment to find out what works and what doesn’t when it comes to managing stormwater on site, and what parts of the plans should be paid for by C-PACE as a way to make the building and the community more resilient. Barkan says that they aren’t just trying to figure out how to keep the building from flooding, but also how to cut down on the amount of stormwater runoff that causes municipal systems to back up.

Zach Barkan

Barkan notes that people in Hampton Roads are experiencing stormwater inundation in places that they didn’t 10 years ago.

“At the end of the day, every building that’s vulnerable to flooding or stormwater damage or sea level rise or climate change deserves to be helped in whatever way they can,” he says. “They all deserve to be resilient buildings. And in a sense, we’re trying to show how C-PACE is going to be a financial mechanism that allows for that to become a reality.”

Barkan says working with VPA is helping Ecovative diversify the type of projects it can take on in the commercial sector. “This has definitely opened up a whole new category that really only a very small group of design firms have even begun to look at.”

He credits RISE funding for enabling not only PACEfi, but also two, ideal pilot projects that will be used as a C-PACE model for the rest of the development, construction and design industries in the Hampton Roads area. “We wouldn’t have been able to do that without them,” Barkan says of RISE.

“I think that they’re providing funding for an extraordinary number of concepts and methods to handling some of the greatest problems that we have as a collective society.”



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