Council accepts $250,000 state HEHA grant for municipal energy project; financing measure splits council

The Englewood City Council on Sept. 2 voted 6–1 to accept a $250,000 High‑Efficiency Electric Heating and Appliances (HEEHA/HEHA) grant from the Colorado Energy Office to support the city’s municipal energy upgrade project.

Sustainability Program Manager Mel England told council the grant was already included in the project funding plan and that the HEHA award will be applied toward equipment and project costs. England said the HEHA funding was part of a larger project budget previously presented to council.

Vote and council comment: the motion to accept the grant passed with Member Russell casting the lone no vote. Member Russell said she was wary of grant money because it is taxpayer money and expressed concerns about past projects that failed to deliver expected savings.

Financing decision: in a separate agenda item council considered tax‑exempt lease‑purchase financing to fund the larger municipal energy project (principal portion $3.9 million with total financing cost presented to council). Staff described the financing as part of an energy performance contract backed by guaranteed energy savings from the project contractor; staff and the contractor said a measurement and verification process and a multi‑year guarantee would document savings and, if necessary, provide remedies or monetary compensation to make the city whole.

Council action and split vote: after debate about the appropriateness of borrowing against municipal facilities without voter authorization, the council approved the tax‑exempt lease purchase financing 4–3. Those voting against the financing said they supported the project’s goals but objected to the debt mechanism and wanted voter approval before pledging city assets. The record shows four ayes and three nays; the three nays were Members Russell, Wright and Ward.

Why it matters: the project replaces aging mechanical systems across multiple city facilities to reduce energy use and save operating costs; staff say grant funding and guaranteed savings reduce net costs and that the financing will be repaid from project savings. Staff also committed to measurement and verification and an annual reporting process with a contractor guarantee should savings fall short.

Next steps: staff will proceed to contract and construction steps and will provide the annual measurement and verification reports; if guaranteed savings shortfalls appear staff said the contractor would remedy the shortfall or provide payment per contract terms.