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San Francisco launches Green Finance SF to expand residential PACE financing
Summary
San Francisco officials announced Green Finance SF, a residential PACE financing program to help owners of properties of four units or fewer pay for energy-efficiency and renewable-energy upgrades with no direct cost to the city, paired with workforce-development commitments and state-level protections for mortgage markets.
San Francisco leaders on Dec. 10 unveiled Green Finance SF, a residential Property Assessed Clean Energy (PACE) program designed to help owners of buildings of four units or fewer finance energy-efficiency and renewable-energy improvements.
Supervisor Farrell, who presented the item, said the program will let property owners finance upgrades through property tax assessments and that capital for discounted PACE loans will come from private lenders so the city bears no financial risk. "Green Finance SF is a program for residential properties of 4 units or less known as PACE," Farrell said, adding the initiative includes a workforce component to train local residents for jobs created by the program.
Mayor Edwin Lee backed the effort and directed the Department of the Environment to move quickly to make the voluntary program available to homeowners. Lee noted earlier versions of PACE in California had stalled amid concerns from the Federal Housing Finance Agency (FHFA) and major mortgage investors, but he said state action — including a reserve fund established in the governor’s budget — reduces that risk. "We are directing you to make sure that you work quickly to make this voluntary program available to all of our San Francisco homeowners right away," Mayor Lee said.
Why it matters: PACE programs lower upfront costs for energy and water upgrades by spreading payment over the life of the improvement and attaching repayment to the property tax bill. Supporters told the commission they expect Green Finance SF to accelerate adoption of renewable energy and efficiency measures while creating local green‑job opportunities through an explicit workforce-development agreement with labor partners and CityBuild.
Details and safeguards: According to the presentation, Green Finance SF will target residential properties of four units or fewer. Capital will be supplied by private entities, program rules will use property-tax assessment mechanisms, and the city plans to participate in a state reserve fund intended to address FHFA concerns about interactions with conventional mortgages. The mayor and Supervisor Farrell emphasized the program is voluntary for homeowners.
Next steps: Staff will develop program details and work with labor partners to finalize a workforce agreement. Officials said additional outreach and implementation steps will follow before enrollment opens.
