HR 4785 - Authorizing Loans for Energy Efficiency Purposes - National Key Vote


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Title: Authorizing Loans for Energy Efficiency Purposes

Vote Smart's Synopsis:

Vote to pass a bill that establishes the Home Star Energy Efficiency Loan Program and the Rural Star Energy Savings Program to provide loans for energy efficiency upgrades in homes and farms.


  • Establishes the Home Star Energy Efficiency Loan Program, under which loans shall be offered at zero percent interest to States to support financial assistance provided by qualified financial entities for the installation of energy saving measures that meet one of the following criteria (Sec. 1):
    • Are published by the Secretary of Energy as part of a master list of residential energy efficiency measures determined to be cost-effective, readily available from commercial sources, permanently installed in a primary residence, and capable of supporting measurement and verification of energy savings that result from their adoption;
    • Are additions to the aforementioned master list that are recommended by the Secretary of Agriculture, calculated to achieve sufficient energy savings that they will achieve "a simple payback" within 10 years or less, and permanently installed in a primary residence; or
    • Are stipulated in a whole-house analysis that simulates energy use before and after a retrofit and are demonstrated to improve residential energy efficiency in a manner that can be determined "with confidence" to be cost-effective and to recover their own cost in savings within the term of the proposed loan.
  • Defines a "qualifying financing entity" as a State, political subdivision of a State, tribal government, electric utility, natural gas utility, nonprofit organization, energy service company, retailer or any other entity which meets the following qualifications (Sec. 1):
    • Offers a financing product whereby applicants make payments over time for the cost of installation;
    • Requires all financed installations to be performed by contractors in a way that meets building code requirements;
    • Establishes standard underwriting criteria to determine the eligibility of Home Star Loan Program applicants;
    • Makes efforts to make loans available in areas that have a poverty rate of 12 percent or more in a proportion that at least equals the proportion that residents of such areas make up of the total population;
    • Is not an entity that has an ongoing capital repayment obligation to the Department of the Treasury pursuant to the Troubled Asset Relief Program (Public Law 110-343); and
    • Is designated as qualified by the Governor of a state.
  • Defines "eligible participant" as a homeowner with a gross annual household income of less than $250,000 who receives financial assistance from a qualified financing entity (Sec. 1).
  • Limits participation in the Home Star Energy Efficiency Loan Program to homeowners with a gross annual household income of less than $250,000 who receive financial assistance from a qualified financing entity, are not also qualified consumers under the Rural Energy Savings Program, and have not been more than 6 months delinquent in child support payments (Sec. 1).
  • Establishes the Rural Star Energy Savings Program for the purpose of making no-interest loans with terms of no more than 20 years to eligible entities that agree to accept the loan funds in order to make loans to qualified consumers for the purpose of implementing residential energy efficiency measures or farm efficiency measures approved by the Secretary of Agriculture (Sec. 2).
  • Defines an "energy efficiency measure" as a fixed structural improvement and investment in a cost-effective, commercial technology to reduce residential energy use (Sec. 2).
  • Defines a "farm efficiency measure" as an energy saving application that is a fixed improvement on a building or structure on a farm at a total loan value of $50,000 or less, that is not otherwise an energy efficiency measure and that would achieve enough energy savings to repay the cost of the measure in 10 years or less (Sec. 2).
  • Specifies that loans made to consumers under the Rural Star Energy Savings Program by eligible entities shall have terms that include, but are not limited to, the following (Sec. 2):
    • They may bear no more than 3 percent interest;
    • They shall finance only energy efficiency or farm efficiency measures for the purpose of decreasing energy usage costs by an amount such that a loan term of no more than 10 years will achieve a "simple payback" of the amount invested;
    • They shall be repaid through charges added to the electric bill for the property for which the efficiency measures will be implemented, except that the property owner may voluntarily prepay the loan and certain other qualifying repayment mechanisms may be used; and
    • They shall require an energy audit to determine the impact of proposed energy efficiency measures on the energy costs and consumption of the consumer.
  • Requires lenders making loans under either of the aforementioned programs to give priority to active duty members of the Armed Forces and veterans (Sec. 3).
  • Prohibits the Secretaries of Agriculture and Energy from providing funds authorized by this bill to any contractor that employs an employee to work in a consumer's home if that employee has been convicted of or plead guilty to a crime of child molestation, rape, or any other form of sexual assault, or to any contractor that has been convicted of or plead guilty to any fraudulent offense (Secs. 4 and 7).
  • Prohibits loans from being provided under this bill to federal employees who meet any of the following criteria (Sec. 5):
    • Have a "seriously delinquent" tax debt;
    • Received a payment under the Low-Income Home Energy Assistance Act of 1981 but were ineligible to receive the payment; or
    • Have been officially disciplined for viewing, downloading, or exchanging pornography, including child pornography, on a Federal Government computer or while performing official Federal Government duties.

Title: Authorizing Loans for Energy Efficiency Purposes