1. Sonoma County AB 811 Rod Dole – ACTTC SONOMA COUNTY – ENERGY INDEPENDENCE PROGRAM

2. AB 811 – Benefits Enabling Residential/Commercial Property Owners to make responsible and affordable energy and resource conservation improvements to existing structures Provide unique financing and repayment vehicle to the Property Owner to fund Improvements Provide job opportunities in the energy and resource conservation improvement fields SONOMA COUNTY – ENERGY INDEPENDENCE PROGRAM

3. AB 811 – T ECHNOLOGY Energy Efficiency & Renewables –Photovoltaic (PV) –Fuel Cells –High-efficiency HVAC –High-efficiency windows & Insulation –Geothermal exchanges Water Conservation –Tankless water heaters –Low-flow devices –Rain cisterns –Smart irrigation systems SONOMA COUNTY – ENERGY INDEPENDENCE PROGRAM

4. AB 811 – B ACKGROUND Governor signed AB 811 (Levine) as an urgency measure Brought the concept to Sonoma County Board of Supervisors on 9/16/08 Presented Feasibility Report to Board of Supervisors on 2/3/09 Other Jurisdictions: Sonoma County is leading the way for Counties in California –Santa Clara, San Diego counties have stated an interest in exploring the program –Berkeley has a similar program, but not AB 811 –ABAG is in early stages of exploring a regional effort SONOMA COUNTY – ENERGY INDEPENDENCE PROGRAM

5. AB 811 – B ACKGROUND Program enters into agreement with property owner to fund energy and water improvements to existing residential and commercial property Property owner agrees to a contractual assessment on property tax bill for up to 20 years Criteria for loan approval –No Clouds on Property Title –Current on Property Taxes –Current on Mortgage(s) Property secures the loan and stays with property SONOMA COUNTY – ENERGY INDEPENDENCE PROGRAM

6. AB 811 – F INANCES SONOMA COUNTY – ENERGY INDEPENDENCE PROGRAM Loans to participants; Interest will cover administration costs plus Treasury note. SCEIP Program Treasury Note Property Tax System Bonds; when loan volume reaches threshold.

7. AB 811 – F INANCES Treasury invests in a series of notes Proceeds of the notes are used to finance loans to participants Participant payments come in via property tax system, paying the loan principal plus an interest rate to cover program operational expenses – analogous to a bank loan Bonds or other long term investment repays the note in full With long term financing, Treasury can invest in a new series of notes SONOMA COUNTY – ENERGY INDEPENDENCE PROGRAM

8. AB 811 – N EXT S TEPS Proposed Timeline: –February 3, 2009: Todays workshop –March 3, 2009: Resolution of Intention –March 24, 2009: Hearing to establish the Program –Implementation at a date determined in Hearing SONOMA COUNTY – ENERGY INDEPENDENCE PROGRAM

9. Questions & Comments SONOMA COUNTY – ENERGY INDEPENDENCE PROGRAM

10. AB 811 – F EASIBILITY No General Fund subsidy Self-sustaining program, whereby program revenue offsets program costs Loans/debt has no negative impact on Countys ability to carry out other projects and operations SONOMA COUNTY – ENERGY INDEPENDENCE PROGRAM

11. AB 811 – F EASIBILITY Found the program to be feasible, but only under certain conditions The most significant factors in making the program feasible are: –Participation levels or loan volume –Timing of long term financing SONOMA COUNTY – ENERGY INDEPENDENCE PROGRAM

12. AB 811 – F EASIBILITY SONOMA COUNTY – ENERGY INDEPENDENCE PROGRAM Cumulative Annual Net Cost Infeasible Program -$8,500,000 -$5,500,000 -$2,500,000 $500,000 $3,500,000 $2.5M Annual Loan Volume$5M Annual Loan Volume $7.5M Annual Loan Volume$10M Annual Loan Volume

13. AB 811 – F EASIBILITY SONOMA COUNTY – ENERGY INDEPENDENCE PROGRAM Cumulative Annual Net Cost Feasible Program -$3,000,000 $0 $3,000,000 $6,000,000 $9,000,000 $12,000,000 $15,000,000 $2.5M Annual Loan Volume$5M Annual Loan Volume $7.5M Annual Loan Volume$10M Annual Loan Volume

14. AB 811 – R ISKS Program Risks –GF dollars are at risk –Participation is not predictable –Interest rates tied to Treasury –Long term financing Community Risks –Repayment in second position –Credit requirements –Community expectations SONOMA COUNTY – ENERGY INDEPENDENCE PROGRAM

15. AB 811 – P ROGRESS TO D ATE Marketing and survey preparation – Water Agency Foundation for Program Report, including initial technologies list Discussions with financial advisors and bond counsel Discussions with other jurisdictions Initiated work with Sonoma County cities SONOMA COUNTY – ENERGY INDEPENDENCE PROGRAM

16. AB 811 – R EQUESTED A CTION Seek your Boards direction to move forward with creating and implementing a Sonoma County AB 811 program Auditor, General Services, PRMD, Counsel, Water Agency to work with CAO to create Program Report SONOMA COUNTY – ENERGY INDEPENDENCE PROGRAM