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Have you seen a big increase in your property tax bill? It may be due
to energy efficient upgrades you’ve made to your home through the PACE
(Property Assessed Clean Energy) program. Click each question below to
read the answer.
PACE stands for Property Assessed Clean Energy. PACE is a state
program that allows for the financing of energy-efficient improvements
to your property through charges, called “special assessments,” on
your tax bill. PACE loans are operated and administered by
government-approved third parties, such as CA HERO Program, YGRENE and
California First. These third party administrators are responsible for
adding PACE special assessments onto your tax bill which then become a
lien on your property.
On your property tax bill, the PACE special assessment will appear
under Boxes 13 or 14, the "Tax Distribution" section, and it
may be one of the largest charges on your bill. The contact number for
your PACE program administrator is right next to the amount.
After you've signed the loan, the first charge for your PACE
improvements may take one or two tax cycles to show up on your bill.
If it doesn't appear this year, you'll likely see it on next year's
tax bill. The charge will be there until you've paid the loan off and
your administrator requests that it be removed from your property taxes.
Your administrator should give you a payment schedule with your
contract documents. Contact them if you don’t have it.
The PACE assessment will increase the amount your lender pays for
your property taxes. Your lender will in turn increase your monthly
mortgage payment to cover the extra cost.
No, state law requires certain information like special assessments
to be included in the bill. Special assessments are collected at the
same time as property taxes. Your tax bill is due in two installments,
which must be paid in full. No partial payments are allowed.
Your PACE administrator must be the one to request that the County
remove the assessment.
The PACE program submits correction requests one or two times a
month. When your PACE line item is removed, you will receive a
corrected tax bill.
But, if you don’t receive that corrected bill before your property
taxes are due, you must pay the total amount shown on your bill to
avoid penalties. Our office will send you a refund if your corrected
bill shows you’ve overpaid.
Remember, the tax collector is not authorized to make any
adjustments or changes to the amount due on your tax bill. The tax
collector is required to collect the payment amounts reflected on your
tax bill, and will then issue any refunds due based on subsequent corrections.
You will be charged a penalty and interest if you don’t pay your bill
on time, just as with other property taxes. You will be charged a 10
percent penalty on your full first installment if you don’t pay it by
December 10th, and you will incur a 10 percent penalty, plus a $10
fee, on your full second installment if you don’t pay by April 10th.
Bills that are not paid by June 30th will go into default, and you
will be charged an extra 18 percent penalty per year.
If your property taxes, including the PACE assessment, remain
unpaid for a number of years, your PACE administrator could
foreclose on your house, or your property could be auctioned off at
the County’s annual tax sale.
Under California law, property taxes typically stay with a home when
it’s sold, and the same is true with special assessments. If you sell
or refinance your property, your PACE administrator may let the PACE
assessment stay with it.
However, either your lender or the buyer’s lender may require you
to pay off the rest of the assessment. You should ask your lender
what they require.
Complaints should be filed with the Department of Business Oversight
(DBO). The DBO relies on complaints to help them protect consumers,
borrowers and investors and obtain redress for them when they’re
victimized by unlawful, unfair or fraudulent business practices.
If you need assistance with the complaint form, please call the
DBO directly at (866) 275-2677.
