HLS 16RS-890 ORIGINAL
2016 Regular Session
HOUSE BILL NO. 766
BY REPRESENTATIVE BROADWATER
DISTRICTS/SPECIAL: Provides relative to sustainable energy financing districts
1 AN ACT
2To repeal Subpart B-44 of Part IV of Chapter 1 of Title 33 of the Louisiana Revised Statutes
3 of 1950, comprised of R.S. 33:130.811 through 130.814, relative to sustainable
4 energy financing districts; to remove the authority granted to local governmental
5 subdivisions to create such districts; and to provide for related matters.
6Be it enacted by the Legislature of Louisiana:
7 Section 1. Subpart B-44 of Part IV of Chapter 1 of Title 33 of the Louisiana Revised
8Statutes of 1950, comprised of R.S. 33:130.811 through 130.814, is hereby repealed in its
9entirety.
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
HB 766 Original 2016 Regular Session Broadwater
Abstract: Repeals provisions that authorize local governmental subdivisions to create
sustainable energy financing districts.
Present law authorizes the governing authority of any local governmental subdivision
otherwise authorized to collect property taxes and to issue and sell bonds to create a special
district known as a sustainable energy financing district. Relative to financing for projects,
authorizes the local governmental subdivision to incur debt in order to provide to the district
sufficient funds to make the loans provided for in present law and authorizes owners of
property in the district to request loans from the district to cover the costs of energy-related
improvements to the property. Provides for loan criteria, conditions, and terms.
Present law provides that in the event that the property for which an energy improvement
loan is sought is encumbered by a mortgage, then the total amount loaned for such property
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HB NO. 766
shall not exceed 10% of the reasonable expected fair market value of the property,
determined using an appropriate value test.
Present law provides that no owner of immovable property shall be eligible for a loan from
a district unless there is available equity in the property and the dollar amount of loans from
the district for a particular property shall not exceed the remaining equity value in the
property. Prohibits the total loan to value ratio for all loans secured by the immovable
property from exceeding 100%. Provides that the calculation of equity value used to
determine the maximum amount of financing available for a particular property may take
into account the reasonable expected value of the property with the proposed energy
improvements installed.
Present law provides that the maximum amount of any assessment to be repaid in any year
shall not exceed the amount of principal and interest for the current year based on the
amortization schedule for the loan. Prohibits acceleration of the debt in the event of
nonpayment or default and provides that tax delinquency shall exist only for assessments not
paid when due.
Present law requires the property owner, in order to qualify for financing, to be current on
all outstanding mortgage loans encumbering the property upon which energy improvements
are proposed and further requires the owner to demonstrate an ability to repay the loan as
specified in the program rules.
Present law requires that an appropriate evaluation be conducted on the qualifying real
property and reviewed by the district prior to approval of the financing.
Present law requires the district, where energy improvements are proposed to be installed
on residential properties, to make written verification that the improvements are installed and
all work is completed satisfactorily before program loan funds are disbursed. In the
alternative, authorizes disbursement of funds based on multiple stages of completion but
prohibits loan funds for a particular stage of completion from being disbursed until the
district conducts written verification that the corresponding stage of work is satisfactorily
completed.
Present law requires that all energy improvements financed by the program be performed
by duly qualified contractors, subcontractors, or tradesmen pursuant to program rules.
Present law requires that prior written notice, by certified mail, return receipt requested, be
given to the mortgagee, its successors or assigns, or mortgage servicer of a commercial
property for which an energy improvement loan is proposed in the amount of $100,000 or
more. Requires the mortgagee, its successors or assigns, or mortgage servicer to approve
or deny the proposed program loan within 30 days of receipt of notice. Provides further with
respect to notice requirements.
Present law authorizes the parties to proceed with the program loan without additional notice
if the mortgagee, its successors or assigns, or mortgage servicer approves the loan or fails
to give a written denial of the loan to the local government subdivision or district within the
30 day period. However, if the mortgagee, its successors or assigns, or mortgage servicer
provides a written denial, then the proposed loan shall not be made.
Present law requires that the amount of the loan be assessed against the property and
collected in the same manner as ad valorem taxes assessed on the property by the local
governmental subdivision. Authorizes the district to enter into agreements with the sheriff
or other property tax collector for assessing and collecting the assessment.
Present law requires the local governmental subdivision, in order to secure repayment of
loans, to file a statement of lien with the recorder of mortgages for the parish in which the
property is located. Further requires that the lien or privilege be for the full amount of the
program loan and take effect against third persons upon the filing of the statement of lien.
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Provides that the lien shall rank equivalent to that of ad valorem taxes or local assessments
and liens and privileges as provided in present law (R.S. 9:4821(1)). Provides further with
respect to the requirements of the statement of lien.
Present law authorizes the local governmental subdivision, upon failure of the property
owner to pay the current year's assessment when due, to enforce the lien and privilege to
recover and collect the current year's assessment along with any prior year's delinquent
assessment.
Present law provides that the lien and privilege has the same ranking as an ad valorem tax
lien on immovable property. Provides that the lien and privilege may be enforced and
collected by ordinary civil proceeding, executory process, or by any other applicable state
law to enforce and collect the amount due as a property tax lien assessed against the
property.
Present law provides that the duration of the effect of recordation of a statement of lien, the
method of reinscription of the statement of lien and the cancellation of recordation of a
statement of lien after the effect of recordation has ceased shall be governed by present law
governing mortgage records and shall be treated like a mortgage for such purposes.
Present law requires the district, in the event that a program loan is paid in full, to provide
written evidence of cancellation and release of its lien and have it recorded in the public
mortgage records for the parish where the immovable property is located.
Present law authorizes prepayment of the remaining balance of energy improvement
program loans.
Present law requires that a loan financing program for energy improvements for residential
property impose requirements and conditions on financing arrangements to ensure timely
repayment and require disclosures to borrowers by the district of the risks involved in
borrowing, including the risk of foreclosure if a tax delinquency results from default.
Proposed law repeals present law.
(Amends R.S. 33:130.811-814)
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