A new Montgomery County Council bill would dedicate 10 percent of the county’s energy tax revenue — almost $18 million this year — to a county nonprofit focused on energy efficiency and investment.
County Council President Tom Hucker and Council Member Andrew Friedson, co-sponsors of the legislation that was scheduled to be introduced Tuesday, told reporters Monday that the measure would help accomplish the county’s goals on reducing greenhouse emissions and fighting the effects of climate change.
The county’s energy tax is “levied and imposed on every person transmitting, distributing, manufacturing, producing, or supplying electricity, gas, steam, coal, fuel oil, or liquefied petroleum gas in the County,” according to a council staff report.
The county has budgeted $175,651,251 for energy tax revenue in the current budget year. Hucker and Friedson’s bill would devote 10% of that total, or about $18 million, for the Montgomery County Green Bank.
The Green Bank is a publicly chartered 501(c)3 nonprofit. Its website say it uses funding from the utility merger of Exelon and Pepco. “The Green Bank leverages this funding with lender partners to provide County residents and businesses with better loan rates, terms, and credit access for clean energy projects,” its website says.
Hucker said that currently, the tax revenue goes into the county’s general fund. The legislation commits 10% of that revenue to the Green Bank each year.
He said the legislation helps reduce greenhouse gas emissions by offering more financial assistance to owners who want to improve their buildings. The building sector accounts for about 50% of all emissions countywide, he said.
The legislation helps building owners make changes to reduce emissions, especially with rising expenses due to the coronavirus pandemic, Hucker said.
“Many of our building owners don’t have the capital that they would like to invest in improving their building stock and making the energy efficiency improvements they would like,” he said.
Friedson said that if the county is setting high goals — including eliminating greenhouse gas emissions in the county by 2035, and cutting them 80% by 2027, per the county’s Climate Action Plan — the public sector should offer as much assistance as possible to the private sector to reach them.
“When we talk about raising the bar for our energy standards, particularly when it relates to the building sector, we can’t just raise the bar and not provide a ladder to help people get over it,” Friedson said.
Tom Deyo, the CEO of the Montgomery County Green Bank, told reporters the legislation will expand the private capital and financing options for building owners to make the necessary improvements to reduce greenhouse gas emissions.
Hucker and Deyo said the investment in the county’s Green Bank would allow that nonprofit to further leverage private investment, adding that would be up to three or four times the county funds put into the Green Bank.
The public sector investment can help encourage private investors and banks hesitant to invest in certain projects, Deyo said. Those can be guarantees, credit enhancements, partnerships and investments with financial institutions and “special loans with tailored underwriting terms and interest rates” for various building types, he added.
Diana Younts, a member of the Takoma Park Mobilization Environment Committee, urged support for the bill Monday, calling it part of a “toolbox” to combat climate issues.
“We can’t meet the county’s, or the world’s goals, without addressing buildings,” Younts said.
Steve Bohnel can be reached at firstname.lastname@example.org