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HomeMy WebLinkAbout1983-12-06; City Council; Resolution 7417. 1 2 3 4 5 6 7 E 9 1c 11 12 1: 11 I! 11 1' 1; 1' 21 2 2 RESOLUTION NO. 7417 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, UTILITY (MSU) SOLAR LEASING PROGRAM. CALIFORNIA, IMPLEMENTING THE CARLSBAD MUNICIPAL SOLAR WHEREAS, on December 21, 1982, the City Council of the City of Carlsbad dopted Ordinance No. 8099 authorizing establishment of a Municipal Solar Utility MSU) Solar Leasing Program; and WHEREAS, the objectives of the MSU Solar Leasing Program are: To lower initial costs of obtaining solar systems; To provide consumer protection measures to residents and businesses desiring to lease solar systems; To enable residents to become eligible for the California Solar Tax Credit as it may apply to leased solar systems; To reduce overall energy demand within the City of Carlsbad, hence, leaving more capital within the City for purchase of local goods and services; To help create new jobs and increase renewable energy and support industries within the City; WHEREAS, the City Council desires to implement the MSU Solar Leasing 1. 2. 3. 4. 5. rogram. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbac s follows: 1. The City Council hereby approves implementation of the MSU Solar Leasing Program according to the Program's Rules and Regulations, attached hereto as Exhibit "A"; The Utilities Department, under the direction of the City Manager, is hereby authorized and directed to implement and administer the MSU Solar Leasing Program. 2. // // a . 1 2 T 21 4 E ” E 7 E 9 1c 3.1 12 13 14 15 16 1’7 18 19 20 21 22 23 24 25 26 27 28 PASSED AND ADOPTED at a regular meeting of said City Council held on the a uy of December 1983, by the following vote, to wit: AYES: NOES: None BSENT: None Council Members Casler, Lewis, Kulchin, Prescott and Chick TTEST : SEAL) 3 EXHIBIT A CITY OF CARLSBAD MUNICIPAL SOLAR UTILITY SOLAR LEASING PROGRAM RULES AND REGULATIONS Table of Contents Sect ion 1 .I 2.1 3.1 4.1 5.1 6.1 7.1 8.1 9.1 10.1 11.1 12.1 13.1 Appendices Appendix A Permit Application Form Permit Certificate Appendix B Bond Form Appendix C Billing Waiver Form Appendix 0 PUC Nomograph 5- EXHIBIT A CITY OF CARLSBAD MUNICIPAL SOLAR UTILITY SOLAR LEASIM; PROGRAM RULES AND REGULATIONS Section 1.1 Purpose and Scope The purpose of the City of Carlsbad Municipal Solar Utility (MSU) Solar Leasing Program Rules and Regulations is to establish rules and procedures that are applicable to all persons participating in the Carlsbad MSU Solar Leasing Program and to provide protection for the consumer. Section 2.1 Definitions The following definitions apply to those persons participating in the Carlsbad MSU Solar Leasing Program. A. The term PERSON means any natural person, partnership, corporation, business trust, association, company or other legal entity . The term SOLAR ENERGY EQUIPMENT includes equipment and materials (and parts solely related to the functioning of such equipment) that is intended to be located on, or affixed to, real property within the City of Carlsbad, and that uses solar energy directly to do the f ol lo wing : i. Provide hot water for domestic service, recreational, or 6. therapeutic purposes ; Provide process heat or mechanical energy; ii. iii. Heat or cool a building or structure; or iv. Generate electricity. G -2- Generally, these functions are accomplished through the use of equipment such as collectors (to absorb sunlight and create hot air, hot liquids or electricity), thermostats or sensors (to activate pumps or fans which circulate hot liquids or air), and heat exchangers (to utilize hot liquids or air to heat other air or water). C. The term LEASE AGREEMENT means: i. A contract between a lessee and a lessor, or a person authorized to act on behalf of a lessor, for the leasing of solar energy equipment, owned by the lessor and leased and possessed by the lessee, which is located on, or affixed to and servicing the real property owned or occupied by the lessee; or ii. A contract for the sale of energy through the installation of solar energy equipment on the real property owned by or occupied by the lessee. D. The term MSU-APPROVED LEASE AGREEMENT means the lease documents submitted to the Carlsbad Utilities Director by the leasing company at the time of permit application submittal, and which lease document conforms with all requirements set forth in Section 8.1 of these Rules and Regulations, and which has been approved by the Utilities Director for use by said leasing company under the Carlsbad MSU Solar Leasing Program. The term LESSOR means any person holding legal title to solar energy equipment and leasing this equipment either directly, or via a person authorized to act on behalf of the lessor, under the Carlsbad MSU Solar Leasing Program. E. 7 -3- F. The term LEASING COMPANY means any person who is authorized to act on behalf of a lessor for purposes of executing a lease agreement and all attendant activities and responsibilities, such as advertising, marketing, placing, installing, maintaining , servicing and repairing solar energy equipment, and who fulfills the requirements of Section 4.1 of these Rules and Regulations. The term LESSEE means any person leasing solar energy equipment located on, or affixed to, the real property owned or occupied by said person. The term INSTALLER means any person, properly licensed under the provisions of the California Contractors License L aw, including any solar specialty license, who is authorized to act on behalf of a lessor and/or leasing company to install, remove or service solar energy equipment subject to a lease agreement, and who fulfills the requirements of Section 5.1 of these Rules and Regulations. G. G. I. The term MANAGEMENT COMPANY means any person who is authorized to act on behalf of a lessor for such activities and responsiblities as collecting leasehold payments, making payments for obligations incurred in lease agreements, holding lessee deposits, maintaining accounting records and arranging for or having performed the maintenance, service and repair of solar energy equipment. J. The term TAX BENEFITS means California or Federal investment tax credits, solar tax credits, accelerated depreciation, tax deferral ad other tax incentives or benefits accruing through the purchase or leasing of solar energy equipment under existing state and federal tax law. K. L. M. -4- The term INACTIVE PERMITTEE means permittees who are physically unavailable, permittees with insufficient financial resources to carry out their responsibilities under each lease agreement and under these Rules and Regulations, or permittees who refuse to perform these responsibilities when so requested by the City, a prospective lessee or a lessee. The term DAY means any day that is not a Saturday, Sunday, or legal holiday in the City of Carlsbad. The term CITY means the City of Carlsbad. Section 3.1 Responsibilities The following responsibilites apply to those persons participating in the City of Carlsbad MSU Solar Leasing Program. A. The LEASING COMPANY is responsible for the installation, maintenace, servicing, repair, and, if necessary, removal of solar energy equipment installed pursuant to an MSU-approved lease agreement. If some or all of the responsibilities set forth in Section 3.1-A are undertaken by an installer, management company, or other person authorized by the leasing company and/or the lessor, the LEASING COMPANY continues to bear responsibility for their completion in accordance wiwth these Rules and Regulations. 6. C. In the event that rmre than one LEASING COMPANY is involved in the marketing, sale, or installation of a single solar energy system, each such Leasing Company shall be jointly and severally responsible to the lessee for complying with these Rules and Regulations. D. E. F. G. H. ->- The LEASING COMPANY shall respond to any lessee complaint regarding failed or defective solar energy equipment leased or installed by said Leasing Company, and such response shall be by on-site inspection within 72 hours of the Leasing Company's receipt of said complaint. The Leasing Company shall make a good faith effort to restore failed or defective solar energy equipment to working condition within 48 hours of the on-site inspection or response. If the Leasing Company authorized to act on behalf of the lessor becomes an inactive permittee, the LESSOR shall assume the responsibilities of that leasing company or assign another Leasing Company to assume such responsibilities, specifically: the proper installation, maintenance, servicing, repair, and, if necessary, removal of solar energy equipment installed pursuant to an MSU- approved lease agreement The CITY is responsible for making available to prospective lessees, lessors, or any other person, information contained in permit applications submitted by Leasing Companies under these Rules and Regulations. The CITY is responsible for the final inspection of solar energy equipment installed under MSU Solar Leasing Program as outlined in Sect ion IO. I herein. The CITY is responsible for making a good faith effort to assist in the resolution of any dispute arising from the MSU-approved lease agreements. I I. J. K. L. -6- The LESSEE is responsible for exercising prudent caution in the execution of a lease agreement with a Lessor or a Leasing Company acting on behalf of a Lessor, part of such prudent caution being the gaining of exact and accurate knowledge of the extent and limit of the above-outlined responsibilites of the City under Section 3.1-F, G, and H. The LESSEE is responsible for obtaining hisiher own counsel on the interpretation of tax benefits as they might apply to hislher leased solar energy equipment. The LESSOR is responsible for exercising prudent caution in legal and financial arrangements with a Leasing Company, Management Company, or other person representing themselves as participants in the City of Carlsbad MSU Solar Leasing Program, part of such prudent caution being the gaining of an exact and accurate knowledge of the above-outlined responsibilities of the City under Section 3.1-F, G, and H. The LESSOR is responsible for obtaining hislher own counsel on the interpretation of tax benefits and regulations, and Securities and Exchange Commission regulations, as they might apply to hislher solar energy equipment. Lessee or Lessor tax benefits or Securities and Exchange Commission regulations as they relate to solar energy equipment. The City claims no knowledge or interpretation of Section 4.1 A. Permit Requirements - Leasing Company No person shall attempt to operate as a Leasing Company of the City of Carlsbad MSU Solar Leasing Program without having a valid MSU Solar Leasing Program Permit. An MSU Solar Leasing Program Permit may be granted to any Leasing Company complying with all requirements noted in this Section 4.1 and participating in the MSU Solar Leasing Program in accordance with these Rules and Regulations. 8. C. D. E. F. -7- The Leasing Company must execute and submit the MSU Solar Leasing Program Permit Application (Appendix A) to the City. This application is to be completed in a truthful and accurate manner, including all requested informat ion. The Leasing Company must submit to the City a copy of the lease agreement(s) which it will offer to prospective lessees. The lease agreement(s) must be approved by the City as an MSU-approved lease prior to the Leasing Company being granted a permit to operate in MSU Solar Leasing Program. comply with all terms outlined in Section 8.1 of these Rules and Regulations. The Leasing Company must submit to the City for review all other documents, in addition to the lease agreement(s), which will be given to and/or signed by the lessee. for document use, does not stop or bind the City from a later determination that any included provision violates these Rules and Regulations. The Leasing Company must submit either a bond in the amount of $20,000 executed on the bond form contained in Appendix B, or a warranty insurance policy to be carried on a coterminous basis with each lease agreement, or copies of manufacturer's warranties for all parts of the solar system equipment, including labor, which are effective on a coterminous basis with the lease agreement term. The Leasing Company must have an office or have agents located in San Diego County, and must fully disclose all San Diego County addresses and telephone nuhers used for mailing or business purposes in The lease agreement(s) must, at a minimum, Review by the City, while required connection with the Carlsbad MSU Solar Leasing Program. G. H. I. J. K. -8- The Leasing Company must verify that no person who has had an MSU Solar Leasing Program Permit revoked by the City is currently affiliated with the applicant in an ownership, managerial, or cont r ol le r capaci t y . The leasing Company must pay to the City a non-refundable permit fee of one-hundred dollars ($100.00). The leasing Company must disclose any change in the information submitted to the City in the permit application, intended lease agreement(s), or any other documents pertaining to the MSU Solar leasing Program, within ten (IO) days of its reasonable discovery. The leasing Company must obey all laws of the United States and of the State of California, and all ordinances of the City of Carlsbad, and report to the City, as soon as reasonably possible, any violation of such laws or ordinances by any person with whom it deals as part of a lease agreement. The MSU Solar leasing Program Permit shall be valid for one year from the date of issuance, and may be renewed annually thereafter by the 1 easing Company repeating the above stated requirements. Section 5.1 Permit Requirements - Installer A. If a leasing Company does not employee as permanent employees its own installers to install, service and repair the solar energy equipment leased through the MSU Solar leasing Program, then the installation company (hereinafter referred to as Installer) that the Leasing Company contracts with or otherwise employs to perform such installation, servicing and repair of the leased solar energy equipment must obtain a valid MSU Solar Leasing Program Permit by complying with the following requirement : -9- B. C. D. E. F. G. H. I. The Installer must execute and submit the MSU Solar Leasing Program Permit Application (Appendix A) to the City. This Application is to be completed in a truthful and accurate manner, including all requested information. The Installer must have an office or have agents located in San Diego County, and must fully disclose all San Diego County addresses and telephone numbers used for mailing or business purposes in connection with the Carlsbad MSU Solar Leasing Program. The Installer must verify that no person who has had an MSU Solar Leasing Program Permit revoked by the City is currently affiliated with the applicant in an ownership, managerial, or controlling capacity . The Installer must size and install the solar system equipment in accordance with City standards and regulations, as outlined in Section 10.1 herein and all state and local codes. The Installer must be appropriately licensed by the Contractors State License Board, and have a valid Certificate of Workmen's Canpensation Insurance on file with the Carlsbad Building Department. The Installer must pay to the City a non-refundable permit fee of one- hundred dollars ($100.00). The Installer must disclose any change in the information submitted to the City in the permit application within ten (IO) days of its reasonable discovery. The Installer must obey all laws of the United States and the State of California, and all ordinances of the City of Carlsbad, and report to the City, as soon as possible, any violation of such laws or ordinances by any person with whom the Installer deals as part of the MSU Solar Leasing Program. -1 0- J. The MSU Solar Leasing Program Permit shall be valid for one year from the date of issuance, and may be renewed annually thereafter by the Installer repeating the avove stated requirements. Section 6.1 Permit Administration A. B. C. D. E. F. G. The City Utilities Department shall be responsible for permit administration and for all general administration and coordination of the MSU Solar Leasing Program. The Utilities Department will process all permit qplications and associated documents required for permit issuance within ten (IO) days of their submission. Permit qplications and related documents filed with the City shall be deemed to be matters of public record, and shall be made available for public inspect ion upon request. The City retains the right to review financial records of all permit applicants. No permit shall be assigned or transferred. The City shall maintain an Active List of permittees for public referral or other purposes. The City shall remove from the Active List any inactive permittee, but shall first give such permittee written notice ten (IO) days prior to removal from the Active List. Inactive permittees include those permittees who are physically unavailable, permittees with insufficient financial resources to operate as an active participant , or those permittees who refuse to perform the duties of a permittee when so requested by the City, a prospective lessee, or lessee. A permit can be denied, suspended, or revoked for any of the following acts: H. I. J. K. L. -1 1- i. Making a false statement of fact required to be revealed in a permit application; or ii. Commisssion of any act involving dishonesty, fraud, or deceit relevant to the permittee's functions and responsibilities; or iii. Violation of the terms, conditions, and responsibilities described in the Rules and Regulations. The City may impose conditions of restitution or damage payment, or order performance changes, as a prerequisite to permit retention or renewal . Any permit suspension, revocation, denial of initial or renewal permit, or order of money payment or performance change as a precondition to a permit, may be appealed to the City Council. The City shall monitor the performance of permittees, and shall investigate all complaints of permit violation. Where unresolved lessee complaints, deemed by the City to be worthy of resolution in lessee's favor, have been made in writing against any permittee, the City, specifying the grounds therefore, may issue a Request to Show Cause why such permittee should not have its permit suspended, revoked or not renewed. Permittees shall attempt to resolve all disputes with lessees involving MSU-approved lease agreements by good faith private negotiations. Section 7.1 Bonds/Warranty Insurance/Warranties Each Leasing Company applying for an MSU Solar Leasing Program Permit must provide: i. A. A performance bond in the amount of $20,000 (see Appendix 8 for Bond Form), to be renewed annually with permit renewal; or , B. C. -1 2- ii. A warranty insurance policy to be carried on a coterminous basis with each lease agreement; or iii. Manufacturer's warranties for all parts of the solar system equipment, including labor, which are effective on a coterminous basis with the lease agreement term. As bond equivalent, an irrevocable letter of credit for $20,000, with the City of Carlsbad designated as beneficiary, shall be deemed acceptable in lieu of the performance bond in Section 7.1-A.i. above. If the Leasing Company chooses to and is able to take option A.iii. above, the manufacturer's chief executive officer must also submit written verification that a local, properly licensed contractor will be assigned the responsibility of servicing the solar system equipment pursuant to the warranty terms and conditions if the original installer and/or Leasing Company is unable to provide such warranty service. Section 8.1 Lease Terms All of the following information must be included in the lease agreement for the lease to be deemed an MSU-approved lease agreement. A. B. C. D. Lease payment amounts, and the formula for altering such amounts over the term of the lease, if any; Statement that the lease payments are due on the first of each month for the term of the lease; Billing/payment procedures, including name and address of person to whom monthly payments are to be delivered; Late payment amounts and other relevant terms, including the conditions for imposition of late payments; E. F. G. H. I. J. K. I. M. N. NOTE: -1 3- Total term of the lease; Rental deposit amount, if any, and the terms for return and use of the rental deposit; Initial installation costs, if any; Cost to lessee for removal of solar energy equipment, if any; Time limitation on exercise of option to renew the lease, if any, and consequences of lease expiration without exercise of renewal option; Liability of lessee for damage to leased solar energy equipment; Consequences to lessee for sale of real property to which solar energy equipment is attached; Conditions and consequences of default; Name, address and phone nuher of the Installation or Leasing Company permittee responsible for installing the solar energy equipment; and Name, address and phone nuher of Leasing Company permittee to be contacted for servicing the solar energy equipment. In addition to the foregoing, required information, no lease agreement will be deemed an MSU-Approved Lease Agreement if either of the following is included in the lease terms: taking or use of the primary residence of a lessee as security for any lease payment or other indebtedness incurred through the lease agreement; or, imposition of penalties for the removal of the solar energy equipment in excess of the reasonable cost for that removal, whether such removal results from lessee default or early lessee termination of the lease agreement . IP -1 4- Section 9.1 Billing/Collection/Disbursal of lease Payments A. The City shall provide a billing service for collection of monthly lease payments under the MSU Solar Leasing Program. billing for solar lease payments under the MSU Program except through the City unless a written waiver to such collection is obtained from the City (See Appendix C for waiver form). The City shall retain no more than ten percent (10%) of the amount collected from each lessee account to recover the costs of operating the MSU Program and providing the billing service. Initially, the City will retain five percent (5%) of the collected lease payments, but reserves the right to increase this retained percentage once annually, provided that it gives sixty (60) days written notice of such increase to permittees, and provided that the total percentage retained does not exceed ten percent (10%) of the collected lease There shall be no 6. payments. C. The City shall maintain records of amounts due from and paid by each lease account. No payments from a lessee shall be collected by the City except according to lease documents submitted to the City by the respective Leasing Company permittee. D. E. Lease collections for each lessee account shall begin only after the City Building Department has approved in writing the final inspection of the installation of the solar energy system. After all lessee account payments for each Leasing Company permittee have been collected each month, the City shall deduct its retained percentage and remit the remaining amount collected to the respective Leasing Company permittee in a timely manner. F. G. H. I. -1 5- Should a lessee default on lease payments contracted for and due, the City shall continue to send monthly billings to such lessee for two subsequent months, noting on such billings the entire lease payment amount then due, including delinquent payments and any late charges prescribed in the lease agreement. Should a lessee accrue three (3) months of payments in arrears, the City shall issue a notice to the lessee to show cause within ten (IO) days why the solar energy equipment should not be removed and any deposit forfeited. If the lessee cannot demonstrate to the City and to the Leasing Company permittee reasonable and acceptable cause for lack of payment within the ten (IO) day show cause period, the Leasing Company permittee shall proceed to take action to remedy the default as prescribed in the lease agreement. If solar energy equipment must be removed from a lessee's premises due to lessee default or lease termination, the Leasing Company permittee shall have said solar energy equipment removed with minimal intrusion to the integrity of the real property to which it is attached. Pipe and equipment added may be removed, but all roof openings shall be sealed and no dangerous or damaged plumbing or electircal hazards shall remain. obtained pursuant to standard City Building Department procedures, but the Building Department shall waive permit fees for such removal work. A building permit for such removal work shall be Section 10.1 Building Permit Requirements A. All solar energy systems installed under the MSU Solar Leasing Program must receive building permits. -1 6- E. At the time of building permit application, the installing contractor must provide a diagram or plot plan of the structure on which the solar energy system will be installed, including the following information : i. The exact location of the equipment and the exact magnetic bearing that the collectors will face; ad ii. An arrow indicating north; and iii. The tilt, in degrees, of the angle of the collectors above the horizon; and iv. The size of the collectors in square feet and the size of the solar storage tank in gallons; and v. The dimension in height, width, and distance of any trees, shrubs or structures that could shade the collectors; if there are none, so note on the plan; and vi. The nuher of bedrooms in the residence. All solar energy systems leased through the MSU Solar leasing Program must be sized, at a minimum, to provide: i. C. Twenty (20) gallons of water per bedroom for the solar storage tank; and For single-family dwellings, twenty (20) square feet of collector area, plus or minus ten percent (10%) per bedroom, unless it can be demonstrated using the Public Utilities Commission (PUC) nomograph for Climate Zone Seven (Appendix D), or an F-Chart printout, that a lesser square footage area of collectors can provide sixty percent (60%) of the water heating load; and ii. ai , -1 7- iii. For multi-family dwellings, ten (IO) square feet of collector area, plus or minus ten percent (IO%), per bedroom, unless it can be demonstrated using the PUC monograph for Climate Zone Seven, or an F-Chart printout, that a lesser square footage area of collectors can provide sixty percent (60%) of the water heating load. D. The final inspection by the Building Department inspectors shall not constitute a guarantee of the performance of any solar energy equipment. Section 11.1 Obliaation of Good Faith A. Every duty governed by these Rules and Regulations imposes an obligation of good faith in its performance or enforcement. Section 12.1 Severability A. If any provision of these Rules and Regulations or its application to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of these Rules and Regulations which can be given effect without the invalid provision or application, and to this end the provisions of these Rules and Regulations are severable. Section 13.1 Violations A. Any violation of these Rules and Regulations may be enforced by the City in any manner provided by law. B. Except as provided in Sections 6.1 and 9.1 hereof, nothing these Rules and Regulations shall be construed to prohibit any person from pursuing other remedies in law or equity. APPENDIX A 0 1 CITY OF CARLSBAD MSU Solar Leasing Program Utili t ies Department 1200 Elm Avenue Carlsbad, CA 92008 (619) 438-5604 HSU SOLAR LEASING PROGRAM PERMIT APPLICATION Annual, Non-Refundable Fee: $100 1. Please check: Leasing Company Ins t a1 le r 1-1 1-1 2. Name, Address, Telephone Number of Firm: T elep hon e 3. City of Carlsbad Business License Number 4. Description of Business: 5. Legal Organization of Firm (check one): Part ers hip 1-1 I- I Sole Propriertorship 1-1 Cor Do rat ion Other I (Please explain) 6. State in Which Firm is Organized: -2- following: members of Board of Directors, officers, general partners, persons managing and/or in control of business, each beneficial owner of 5% or more of voting stock or equity capital (attach additional sheets, if necessary) : 7. List names, business addresses, and telephone nuhers for all of the 8. Contractor's L icense Nuher, if applicable : 9. Please check which of the following is being submitted and attached hereto as Required by Section 7.1 of the Rules and Regulations (for Leasing Company On1 y ) : A. Bond Form 1-1 B . Warranty Insurance 1-1 C. Manufacturer's Warranties 1-1 If you checked 9.A or 9.B above, please state the name, address, telephone nuder, and name of contact person of the bond company or warranty insurance company: T ele p ho ne If you checked 9.C above, please state the name, address, telephone nuder, and name of contact person of the manufacturer: Telephone IO. Is your firm currently under any State or Federal investigation? 1-1 No I= I Yes - Explain e -3- 11. Attach copy of your firms Lease Agreement intended for use in this Program. ................................................................... * IMPORTANT NOTICE: THE CITY OF CARLSBAD CLAIMS NO KNOWLEDGE * * OR INTERPRETATION OF STATE OR FEDERAL TAX BENEFITS OR * * SECURITIES AND CORPORATIONS LAWS OR REGULATIONS. * * PARTICIPANTS IN THE MSU SOLAR LEASING PROGRAM MUST TAKE * * RESPOINSIBILITY FOR SEEKING PROPER COUNSEL ON THESE LAWS. * ................................................................... In consideration of the issuance by the City of Carlsbad of the permit requested by this *plication, the applicant agrees to indemnify, defend and hold the City of Carlsbad, its officers, agents and employees, free and harmless from any and all liabilities, claims, demands, actions, losses, damages and costs, including all costs of defense thereof, caused by, arising out of, or in any way related to applicant's activities, conduct, or operation undertaken pursuant to this permit. The applicant has received a copy of, read, and understands the City of Carlsbad MSU Solar Leasing Program Rules and Regulations, and agrees to abide by all provisions thereof. The undersigned certifies that all of the above information is true and correct. If the undersigned is not the applicant, the undersigned further certifies that he/she is authorized by the applicant to file this application and to agree to the above conditions on applicant's behalf. SignaturelTitle: NamelTitle (type or print): Date of Application: ** FOR 1. 2. 3. 4. 5. 6. ...................................... CITY OF CARLSBAD UTILITIES DEPARTMENT USE ONLY Verification of Valid Contractors L icense Initials/ Date Verification of Valid City Business L icense Verification of Workmen's Compensation Insurance Approval of Bond/ Warranty Insurance/ Warranties as required .. in Section 7.1 of Ruies and Regulations Approval of Lease Terms Other Verif icationsi Approvals (i.e. billing waiver form, etc.) A p pr ov ed by : Date Approved: ~~ Permit Number: Date Permit Issued: -4- CITY OF CARLSBAD MSU SOLAR LEASING PROGRAM PERMIT Pursuant to City Rules and Regulations for the M!3U Solar Leasing Program, and conditioned upon payment of the required fee at time due, this PERMIT is hereby granted for the term and purpose stated, as of Permittee: I Business Description: Expirat ion : Issued by: Permit N urrber I THIS PERMIT IS NOT TRANFERABLE I I I I I I I APPENDIX B Bond Nunber Premium $ CITY OF CARLSBAD MSU SOLAR LEASING PROGRAM LEASING COMPANY BOND KNOW ALL MEN BY THESE PRESENTS, THAT, we, , as principal, and , a corporation authorized to do business in the State of California, as Surety, are held and firmly bound unto the CITY OF CARLSBAD, a municipal corporation in the County of San Diego, State of California, in the sum of TWENTY THOUSAND DOLLARS ($20,000.00) for payment of which sums well and truly to be made, the Principal and Surety hereby bind themselves, their heirs, administrators, executors, successors and assigns, jointly and severally, firmly by these presents. WHEREAS, the above Principal is, concurrently herewith, making an application to the City of Carlsbad for a Leasing Company permit under the Carlsbad MSU Solar Leasing Program Rules and Regulations, which Rules and Regulations are incorporated herein by reference ; NOW, THEREFORE, the condition of this obligation is such that if a Carlsbad MSU Solar Leasing Program Permit is granted to said Principal, and if such permittee shall during the lift of said permit faithfully observe all the provisions of the MSU Solar Leasing Program Rules and Regulations, and faithfully perform the duties required by said Rules and Regulations, then the above obligation shall be void; otherwise to be and remain in full force and effect. , - 2- PROVIDED: 1. The liability of the Surety upon this bond shall be and remain in full force and effect for the full period of the MSU Solar Leasing Program Permit issued to the Principal aboved named but not beyond ? 19 - , or thirty (30) days after receipt by the City of Carlsbad of written notice signed by such Surety, or its authorized agent, stating that the liability of such surety is thereby terminated and cancelled. 2. Nothing herein shall affect any rights or liabilities which shall have accrued under this bond prior to the date of such termination. This bond shall be conditioned that the total aggregate liability of the Surety for all claims shall be limited to the face amount of this bond irrespective of the nuher of years this bond is in force. This bond may be extneded for a further term by the issuance of a Continuation Certificate signed by the Surety. Signed, sealed and dated this day of 9 19 Principal BV : Surety By : Attorney-in-Fact APPENDIX C 3, ' CITY OF CARLSBAD MSU Solar Leasing Program BILL IN€ WAIVER FORM Pursuant to Section 9.1 of the Carlsbad MSU Solar Leasing Program Rules and Regulations, a written waiver is necessary for collection of solar lease payments by an entitity other than the City of Carlsbad, This billing waiver form fulfills said requirement for collection of solar lease payments from the following lessee : NAME ADDRESS T EL EPHONE Billing and collection of solar lease payments from the foregoing lessee will be performed by: NAME ADDRESS TEl EPHONE CONTACT PERSON Signature/ T it le Date Sign atu r e/ T i tle Date L easing Company City of Carlsbad Return this form with a copy of the lease agreement attached to: CITY OF CARLSBAD MSU Solar Leasing Program Utili t ites Department 1200 Elm Avenue Carlsbad, CA 92008 3"- CITY OF CARLSBAD nsu SOLAR LEASING PROGRAM STAFF PROCEDURES MANUAL I .. 0 J I. TABLE OF CONTENTS Page -1- INTRODUCTION This manual sets forth administrative procedures for relevant Carlsbad staff members to use in implementing and administering the Municipal Solar Utility (MSU) Solar Leasing Program. time if significant operational changes are deemed necessary. However, it should be noted that the procedures contained herein are merely a guide, and flexibility in administration of the program will be necessary. This document may be amended by staff from time to The Utilities Department, Finance Department, and Building Department all have certain administrative responsibilities in operating the MSU Solar Leasing Program. separately in this manual, a thorough understanding by staff of all departments' responsibilities will lead to smooth and efficient operation of the program. Although each department's procedureal guidelines are treated 37 -1- INTRODUC?ION This manual sets forth administrative procedures for relevant Carlsbad staff members to use in implementing and administering the Municipal Solar Utility (MSU) Solar Leasing Program. time if significant operational changes are deemed necessary. However, it should be noted that the procedures contained herein are merely a guide, and flexibility in administration of the program will be necessary. This document may be amended by staff from time to The Utilities Department, Finance Department, and Building Department all have certain administrative responsibilities in operating the MSU Solar Leasing Program. separately in this manual, a thorough understanding by staff of all departments' responsibilities will lead to smooth and efficient operation of the program. Although each department's procedureal guidelines are treated e -2- UTILITIES DEPARTUENT The Utilities Department has primary responsibility for all administration of the MSU Solar Leasing Program, except for the billing service function operated by the Finance Department, and the building permit process handled by the Building Department. The Utilities Department has five administrative tasks to per form: 1. 2. Processing/Approving Installers as Permittees 3. 4. 5. Complaint Resolution Processing/Approving Leasing Companies as Permittees Disseminating Program Information to the Public Coordinating Billing Process Information with the Finance Department A. If a leasing company employs its own installers, then the leasing company will complete one permit application and note on this form that it has in-house employees performing the installation work. employ its own installers, then the installation company that it contracts with to provide installation, servicing, and repair of the leased solar systems must also complete a permit application form and be approved as a Permittee (see Section B below). Proce.ssing/Approving LeasJnq C,o-mpa,nies. as Petees If the leasing company does not Each leasing company that wants to become a permittee should be given a copy of the Rules and Regulations and a permit application (from Appendix A of the Rules). necessary to process its permit application: The leasing company must return the following items, all of which are 1. 2. 3. 4. 5. 6. 7. Completed permit application form Payment of $1 00.00 a. Bond Form, or b. Warranty Insurance Policy, or c. Lease agreement(s) to be used in the Program Manufacturer's information for all parts of the solar system equipment, including schematics, installation/operation manual, warranties, etc. a. Name and mailing address for the City's use in disbursing payment for lease billings collected through the City's billing process, or Completed Billing Waiver Form (from Appendix C of the Rules) stating that all lease payments will be collected by the company listed on this Form. Manufacturer's warranties for all solar system parts and labor, which are coincident with the lease agreement term b. The company's most recent financial stataement (NOTE: This is optional, but it would be a good idea to request this information if the leasing company has been operating for two years or less.) Once this information is submitted, the Utilities Director should review it within ten days and contact the leasing company within that time period if any explanation or more information is necessary. application form the Utilities Drector should note that if manufacturer's In reviewing the permit -3- warranties are submitted in lieu of a bond, pursuant to 3.C above, the term of the warranties must coincide with the term of the lease agreement, and the warranties must include parts and labor. The Utilities Director should contact the manufacturer's representative listed in Section 9 of the permit application form for written verification from the manufacturer's chief executive officer that another local contractor will be appointed to provide warranty service for the leased solar systems if the original leasing company goes out of business or is otherwise unavailable to perform such warranty service. If the manufacturer refuses to provide such written verification, then the leasing company will have to submit either the required $20,000 bond or a Warranty Insurance Policy that is coincident with the lease agreement term in order to obtain a permit to operate in the Program. In reviewing the lease agreement terms, the Utilities Director should use Section 8.1 of the Rules and Regulations as a checklist for all information that must be provided in the lease agreement. It is important to note that if either of the following provisions are included in the lease agreement, the lease cannot be approved until these terms are removed: residence of a lessee as security for any lease payment or other indebtedness incurred through the lease agreement; or, imposition of penalites for the removal of solar energy equipment in excess of the reasonable cost for that removal, whether such removal results from lessee default or early lessee termination of the lease agreement. lease agreement is full disclosure of lease terms to protect the interests of consumers who may enter into solar lease agreements with permittees or the P r ogr am. taking or use of the primary The purpose of the review/approval of the The Utilities Director will complete the permit application review/approval process by using the checklist at the end of each permittee's application. Assuming the applicant has complied with all necessary requirements to become a leasing company permittee of the Program, a permit, such as the model included in Appendix A of the Rules and Regulations, will be issued to the leasing company. This permit may be renewed annually. Once a leasing company becomes a permittee, the Utilities Direcotr should clarify to the permittee the procedures to be followed for submittal of signed lease agreements, explain the City's billing collection/disbursal process, and remind the leasing company permittee that its installers must follow the building permit requirements contained in Section 10.1 of the Rules and Regulations for installation of all leased solar systems. B. Processing/Approvinq Installers as- Permittees An installation company (hereinafter referred to as installer) that contracts with a leasing compnay to provide installation, servicing, maintenance, and repair of the leasing company's solar systems must become a permittee of the Program. a permit application form. form and $100.00 to be processed and approved as a permittee by the Utilities Director. The installer should be given a copy of the Rules and Regulations and The installer must return the completed application -4- The Utilities Director will use the checklist at the end of the application form to approve an installer as a permittee. lease term approvals apply only to leasing companies and not to installers. Approval of installer permit applications is a straight-forward process, and should be completed within ten days of submittal of the application. Upon approval, a permit, such as the model included in Appendix A of the Rules and Regulations, will be issued to the installer. annually. Once an installer becomes a permittee, the Utilities Director should remind the installer that the building permit requirements contained in Section 10.1 of the Rules and Regulations must be followed for installation of all leased solar systems. It should be noted that the bond and This permit may be renewed C. Disseminating Program Informatio,n to the Public The Utilities Department will maintain an "Active List" of Program permittees, including telephone numbers and addresses. prospective lesssees requesting same. Interested City residents will call the Utilities Department to request names of approved leasing companies and general information about the Program. IJtilities Department staff should be directed to inform residents that details about lease terms, type of solar systems available for lease, etc. can all be obtained by contacting the leasing companies directly. To assure the residents that the City is actively promoting consumer protection in this Program, the residents should be told that all companies on the "Active List" are approved by the City for participation in the Program. This list will be sent to Residents should also be informed that to be eligible to apply for the California 50 percent solar tax credit off their lease payments, they must lease from a company on the City's "Active List". This state tax credit is currently scheduled to expire as of December 31, 1986. credit, or to obtain the proper tax forms that the residents must file to apply for the credit, they should contact the California Franchise Tax Board. solar tax credits knot apply to leased solar systems; the lessee will obtain the total 50 percent %credit from the State, based on the amount of solar lease payments actually paid during any given tax year while this tax credit is in effect. For more details on this tax Federal The individual leasing companies are responsible for their own marketing and generation of potential lessee leads. obtain about the Program, via articles in the City Newsletter and local newspapers, will be beneficial. Program publicity. However, any publicity that the City can The Utilities Department will coordinate this D. Coordinating Billing Process 1nformat.ion with Finance Department At the inception of the Program, the Utilities Director should meet with appropriate Finance Department staff to ensure a thorough understanding of the billing process, procedures to be followed, and account numbers to be used for both lessees and leasing company permittees. a permittee should have a separate account number for purposes of remitting 95 percent of the monthly lease payments collected by the City. to this is when a leasing company permittee has executed a billing waiver form for all of its leased solar systems. As residents become lessees, each lessee Each leasing company that becomes The only exception should be assigned a separate account number. account number to be used for retention of the five percent of collected lease pay men t s . Finally, the City should have one As residents lease the solar systems, the leasing company permittees will give the Utilities Director copies of the signed leases. should be established and an account number assigned to the lessee. The Utilities Director will provide the following information to the Finance Department: A folder for each lease 1. Lessee's name, address, and account number; 2. 3. Name and account number of respective leasing company permittee; Monthly lease payment amount, and the breakdown of this payment in terms of five percent to be retained by the City and 95 percent to be remitted to the leasing company permittee; Date lease payments are to commence (always due on first of the month); and Amount of late fee charges to be assessed if payment is delinquent, and effective date for late fee charges, as specified in the lease agreement. 4. 5. The Finance Department will operate the billing system and notify the Utilities Department if any lessee develops a delinquent payment status requiring further action by the Utilities Director (see Section C under Finance Department for discussion of action to be taken if a lessee becomes three months in arrears on making lease payments). E. Complaint Resolut_ion Lessees should always contact the respective leasing company first if they are dissatisfied with any work performed, need service or repair on their solar system, etc. should resolve virtually all complaints and/or problems. company and lessee should have an unresolved dispute, then the Utilities Director should attempt to mediate the dispute and bring it to a timely resolution. satisfaction of both parties, the dissatisfied party can, as a last resort, take the matter to the City Council. This direct interaction between the leasing company and lessee However, if a leasing In the unlikely event that a problem cannot be resolved to the -6- FINANCE DEPARTMENT The Finance Department will administer the monthly billing/collection process for the MSU Solar Leasing Program, operate their own billing systems if they execute billing waiver forms with the Utilities Department. the first of each month for ease of processing by the Finance Department, Utilities Director will provide the Finance Department will all pertinent information to initiate billing for new lessees. collected, the City will retain five percent of the total payments and remit the remainder to the respective leasing companies. Leasing companies do have the option to All leases will state that monthly payments are due on The Once all monthly payments are A. Establishing New Leasing Company and Lessee Accounts Each leasing company permittee should have its own account number for purposes of the Finance Department remitting 95 percent of the lease payments collected monthly. remaining five percent that is retained monthly. A block of account numbers should be reserved for assignment of new lessees. be furnished with all relevant account numbers, and in turn will provide the Finance Department will all necessary information to initiate monthly billing for each new lessee (see Section D under Utilities Department). Likewise, the City should have an account number for deposit of the The Utilities Director should 6. Monthly .Billing, Process Billing processes will be developed by the Finance Director and will be integrated with the monthly utility billing process in place. C. Delinauent Pavments If a lessee fails to pay his/her monthly invoice on time (including any grace period set forth in the lease terms), the subsequent invoice should include the next month's lease charges and late fees, if any. If the lessee again fails to bring his/her account up to date, the same process should be followed for the subsequent invoice, the lessee's delinquent status at this time. full payment, and thus is three months in arrears on payment, the Utilities Director shall issue a notice to the lessee to show cause within ten (IO) days why the solar energy equipment should not be removed, the security deposit forfeited, and the leasing company notified to proceed with action to remedy the default as prescribed in the lease agreement. If the lessee can demonstrate just and reasonable cause for default, the Utilities Director shall attempt to mediate and facilitate a meeting at which the lessee and leasing company can arrive at a solution to the problem that is acceptable to both parties. If such an acceptable solution is not ~Porthcoming, the City shall not prevent the leasing company permittee from remedying the situation as stated in the specific lease agreement terms. In addition, the Utilities Director should be notified of If the lessee again fails to make .r 4 L "4"L * -7- BUILDIMI; DEPARTUENT The Building Department is responsible for issuing building permits for all solar systems installed under the MSU Solar Leasing Program, and for making final inspection of these installations. protection regarding sizing of the solar systems leased through the Program, the Building Department will require that a plot plan diagram be submitted with the building permit application, showing relevant information about the sizing of the solar system and its location and orientation. made, the inspector will use this diagram to confirm that the system was installed as planned, in addition to inspecting electrical, plumbing, etc. components of the system. In order to provide consumer When the final inspection is A. , Plan -Check/Buildinq Permit Insurance At the time of building permit application, the installing contractor must provide a plot plan diagram of the structure on which the leased solar system will be installed. The following information must be on the plot plan diagram: 1. The location of the solar storage tank and collector(s), and the exact magnetic bearing that the collector(s) will face; 2. A north arrow; 3. The tilt, in degrees, of the angle of the collector(s) above the horizon; 4. The size of the collector(s) in square feet and the size of the solar storage tank in gallons; 5. The number of bedrooms in the residence; and 6. The dimension in height, width, and distance of any trees, shrubs, or structures that could shade the collector(s); if there are none, so note on the diagram. The counter person in charge of issuing building permits will verify that all the aforementioned information is provided on the plot plan diagram. counter person will also verify with regard to number one above that the collector(s) are facing within 90 degrees of true south, and with regard to number three above that the tilt angle of the collector(s) above the horizon is between 14 and 53 degrees. the counter person will verify that the solar storage tank contains, at a minimum, 20 gallons per bedroom, and the approximately 20 square feet of collector area (plus or minus ten percent) is provided per bedroom. NOTE: the case of multi-family residences, the collector area must be approximately ten square feet (plus or minus ten percent) per bedroom. The Finally, with regard to numbers four and five above, In Assuming that the information on the plot plan diagram conforms with that noted above, the building permit will be issued, and the plot plan diagram will be attached to the copy of the permit that the inspector will take to the job site. If the plot plan diagram does not conform with the requirements noted above, the counter person will instruct the contractor what changes need to be made prior to permit issuance. The counter person should be aware that the 20 square feet of collector area per bedroom for single-family dwellings, and ten square feet of collector area per bedroom for multi-family dwellings (plus or minus ten percent for either case), is a "rule of thumb." footage of collector area per bedroom, that is acceptable. However, if significantly less square footage of collector area per bedroom is shown, which may happen at times with extremely efficient collectors, then the installing contractor must justify the collector sizing by submitting a completed PUC nomograph (Appendix D of the Rules and Regulations) for the collector. By submitting the nomograph, the contractor can size the collector area according to the square footage demonstrated on the nomograph. double the collector square footage area shown on the nomograph for each bedroom of a single-family dwelling residence, but this doubling is not required for each bedroom of a multi-family residence. plot plan diagram conforms with that shown on the nomograph (and all other required information is shown on the plot plan diagram), the building permit will be issued and a copy of the diagram attached to the inspector's copy of the permit . If the installing contractor shows a greater square The counter person must - Assuming the collector sizing on the B. Final Inspection When the contractor has completed the installation, the contractor will call the Building Department for final inspection. The inspector will perform the usual plumbing, electrical, etc. inspection, and also verify that the solar system was installed as shown on the plot plan diagram attached to the inspector's copy of the permit. -9- co~cLusIoN Any questions not answered in this manual should be addressed to the Utilities Director, since the Utilities Department is the primary administrator of this Program. Other information sources are neighboring cities (i.e. Oceanside and San Diego) that have implemented similar HSU Solar Leasing Programs. By using this manual, implementation and administration of the Program should not be troublesome or too time consuming for any affected Department, and the residents of Carlsbad will have a new opportunity to obtain solar water heating systems on an affordable basis.