II 

111TH CONGRESS 

2D SESSION S. 3642 

To ensure that the underwriting standards of Fannie Mae and Freddie 

Mac facilitate the use of property assessed clean energy programs to 

finance the installation of renewable energy and energy efficiency improvements. 

IN THE SENATE OF THE UNITED STATES 

JULY 22, 2010 

Mrs. BOXER (for herself, Mr. MERKLEY, Mrs. GILLIBRAND, and Mr. BEGICH) 

introduced the following bill; which was read twice and referred to the 

Committee on Banking, Housing, and Urban Affairs 

A BILL 

To ensure that the underwriting standards of Fannie Mae 

and Freddie Mac facilitate the use of property assessed 

clean energy programs to finance the installation of renewable energy and energy efficiency improvements. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘The PACE Assessment 

5 Protection Act of 2010’’. 


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•S 3642 IS

1 SEC. 2. TREATMENT OF PACE PROGRAMS BY FANNIE MAE 

2 AND FREDDIE MAC. 

3 (a) ADOPTION OF UNDERWRITING STANDARDS.— 

4 Not later than the expiration of the 60-day period that 

5 begins upon the date of the enactment of this Act, the 

6 Federal National Mortgage Association and the Federal 

7 Home Loan Mortgage Corporation shall adopt under8 writing standards that are consistent with the Guidelines 

9 for Pilot PACE Financing Programs issued on May 7, 

10 2010, by the Department of Energy. Liens or other prop11 erty obligations that secure property taxes or assessments 

12 under a PACE program and are consistent with such 

13 standards shall be considered to comply with the Uniform 

14 Instruments of such Association and Corporation and 

15 shall not constitute a default on an existing mortgage or 

16 trigger the exercise of lender’s remedies for a property 

17 with such a lien. With respect to a property that meets 

18 the underwriting criteria of the Association and the Cor19 poration without consideration of the PACE program lien, 

20 the Association and the Corporation shall not require re21 payment of a PACE program tax or assessment in order 

22 for a property owner to finance, refinance or transfer the 

23 property. The underwriting standards shall provide that, 

24 in the event that a tax or assessment under a PACE pro25 gram is delinquent, only the unpaid delinquent amount 


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•S 3642 IS

1 along with applicable penalties, interest and costs will be 

2 subject to foreclosure and not the entire amount. 

3 (b) PROHIBITION OF DISCRIMINATION.—The Federal 

4 Housing Finance Agency, the Federal National Mortgage 

5 Association, and the Federal Home Loan Mortgage Cor6 poration, and all Federal agencies and all entities char7 tered under Federal law shall not discriminate against 

8 communities implementing or participating in a PACE 

9 program, including by prohibiting lending within the com10 munity or requiring more restrictive underwriting criteria 

11 for properties within the community. 

12 (c) DEFINITION OF PACE PROGRAM.—For purposes 

13 of this section, the term ‘‘PACE program’’ means a prop14 erty assessed clean energy program under which a State 

15 or political subdivision of a State levies taxes or assess16 ments on residential, commercial, agricultural, and other 

17 real property to finance the installation of renewable en18 ergy and energy efficiency improvements. 

Æ 


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