SB 1041
Voluntary contractual assessments: wildfire safety improvements.
Vote required
Majority
Fiscal committee
No
Appropriation
No
Current location
Appropriations
Take action
Record your position on this measure.
Sign in to record your position, submit testimony, or contact your legislator.
Sign in to take action- Introduced
- Passed Senate
- Passed Assembly
- To Governor
- Became Law
Bill overview
This bill extends the Wildfire Safety Finance Act, allowing local public agencies to establish voluntary contractual assessment programs to finance wildfire safety improvements on residential, commercial, and industrial properties. It eliminates the requirement for agencies to be designated as ‘Very High Fire Hazard Severity Zones’ and instead permits agencies with existing PACE programs or special tax districts to participate. The bill also modifies eligibility requirements for projects, including expanding the types of improvements covered and extending the timeframe for these changes to January 1, 2035, and includes provisions for reporting requirements and hardship programs for property owners.
Key provisions
- Extends the Wildfire Safety Finance Act until January 1, 2035.
- Eliminates the requirement for agencies to be designated as Very High Fire Hazard Severity Zones.
- Allows agencies with PACE programs or special tax districts to participate.
- Expands eligible wildfire safety improvement projects to include defensible space improvements and certain building materials.
- Requires program administrators to establish hardship programs for property owners.
- Mandates biannual reports to the legislature detailing PACE assessment funding, improvement types, and associated savings.
- Includes provisions for data privacy and public availability of report information.
- Modifies the five-day right to cancel for property owners over 65.
Who is affected
- Homeowners
- Businesses
- Local Public Agencies (cities, counties)
Arguments in favor
Reasons to support this legislation.
No arguments in favor have been submitted.
Submit yoursArguments opposed
Reasons to oppose this legislation.
No arguments opposed have been submitted.
Submit yoursRead the latest version inline or switch to a previous version.
SB1041:v97#DOCUMENT
Bill Start
| Amended IN Senate April 27, 2026 |
| Amended IN Senate March 19, 2026 |
CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION
Senate Bill
No. 1041
| Introduced by Senator Arreguín |
| February 11, 2026 |
An act to amend Section 5899.4 of, and to amend and repeal sections Sections 5898.16, 5898.17, 5902, 5913, and 5954 of, and to amend, repeal, and add Section 5899.4 of, the Streets and Highways Code, relating to local government.
LEGISLATIVE COUNSEL'S DIGEST
SB 1041, as amended, Arreguín. Voluntary contractual assessments: wildfire safety improvements.
Existing law authorizes a public agency to establish a contractual assessment program, under which public agency officials and individual property owners may enter into voluntary contractual assessments to finance certain improvements to real property, as specified. To finance those improvements, existing law authorizes a public agency to issue bonds, or to advance its own funds and later sell bonds to reimburse itself for those advances. Under the program, those bonds or advances would be repaid through the voluntary contractual assessments, which constitute a lien against the lots and parcels land, as specified. To establish a contractual assessment program, existing law requires the legislative body of the public agency to adopt a resolution that, among other things, provides certain details of the program, including the kinds of projects and the geographic area within which properties would be eligible for financing under the program.
Existing law authorizes a public agency to establish a contractual assessment program to finance certain kinds of improvements that are attached to real property, including energy or water efficiency improvements. This contractual assessment program is commonly known as a Property Assessed Clean Energy (PACE) program. The California Financing Law requires the Commissioner of Financial Protection and Innovation to license and regulate persons who administer a contractual assessment program on behalf of a public agency, as specified.
Existing law, the Wildfire Safety Finance Act (act), authorizes the legislative body of any public agency that has accepted the designation of Very High Fire Hazard Severity Zone to create a voluntary contractual assessment program to finance wildfire safety improvements, as specified. The act defines “wildfire safety improvements” as, among other things, permanent wildfire resilience and safety improvements fixed to existing real property. The act prohibits a wildfire safety improvement financed under the act from being used as a part of a project to construct a new home or to rebuild or reconstruct a home that was destroyed or damaged in a fire. Existing law repeals the Wildfire Safety Finance Act on January 1, 2029.
This bill would indefinitely extend the operation of certain provisions of the Wildfire Safety Finance Act and would revise the requirements on a legislative body of a public agency to establish a voluntary contractual assessment program under the act. In this regard, the bill would eliminate the requirements that the legislative body accept a designation of Very High Fire Hazard Severity Zone and adopt a resolution establishing the program. Zone. The bill would instead authorize any public agency that has established a PACE program or established a special tax relating to a specified community facilities district to enter into voluntary contractual assessments with property owners to finance the installation of wildfire safety improvements, as defined.
The bill would would, until January 1, 2035, modify the projects eligible for financing under the act to, among other things, include wildfire safety improvements in connection with the rebuilding or reconstruction of property that are in addition to or an improvement to the property as it existed immediately before it was destroyed or damaged by fire, consisting of Class A fire-rated roofs, enclosed eaves, fire-resistant vents, multipane windows, and other wildfire safety improvements identified in regulations adopted by the Department of Insurance, as specified. The bill would also also, until January 1, 2035, include improvements that contribute to the defensible space Zones 1 and 2 of a property, which includes the space between 0 and 100 feet from each side and from the front and rear of the structures that can be fixed to a building or structure, as specified.
The bill, until January 1, 2035, would require a program administrator providing wildfire safety improvements to have a hardship program that includes a process for requesting that a program administrator remove a lien if a wildfire destroys the property or improvements.Existing law requires a program administrator to submit, for each PACE program it administers, a biannual report to the public agency that includes certain information, including the number of PACE assessments funded, by city, county, and ZIP Code.This bill would require that report to include the total number of wildfire safety improvements, including the average cost of each product type. The bill would also require the report to include the estimated total amount of savings produced by the wildfire safety improvements installed in the calendar year by city, county, and ZIP Code.The bill would require a program administrator providing wildfire improvements to file a report to the appropriate policy committees of the Legislature by January 1, 2030, that includes the information included in the above-described report provided to the public agency, information relating to complaints regarding the wildfire safety improvements, and a description of the above-described hardship program, as specified.
Digest Key
Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NO
Bill Text
The people of the State of California do enact as follows:
SECTION 1.
Section 5898.16 of the Streets and Highways Code, as amended by Section 11 of Chapter 158 of the Statutes of 2020, is amended to read:
5898.16.
(a) A public agency shall not permit a property owner to participate in any program established pursuant to this chapter for the purposes specified in paragraph (2) of subdivision (a) of Section 5898.20 or Section 5899, 5899.3, or 5899.4 if any of the following apply:
(1) The property owner’s participation would result in the total amount of the annual property taxes and assessments exceeding 5 percent of the property’s market value, as determined at the time of approval of the property owner’s contractual assessment.
(2) The property does not comply with the conditions specified in paragraphs (1) to (5), inclusive, and paragraph (8), and, in addition, for properties with energy efficiency improvements specified under Section 5898.20 of this code and paragraph (7) of subdivision (a) of Section 26063 of the Public Resources Code.
(b) A public agency shall not permit the property owner to participate in any program established pursuant to this chapter for the purposes specified in paragraph (2) of subdivision (a) of Section 5898.20 or Section 5899, 5899.3, or 5899.4 unless the property owner is given the right to cancel the contractual assessment without penalty or obligation, consistent with the following:
(1) (A) The property owner shall receive the right to cancel document set forth below or a substantially similar document that displays the same information in a substantially similar format. The document shall be provided to the property owner as a printed copy unless the property owner agrees to an electronic copy.
| Right to Cancel | |
| Property Owner: [Owner Full Name],[Phone],[Email] | |
| Property Address: [Property Address] | |
| Your Right to Cancel: | |
| You are entering into a contractual assessment with [Provider] for financing that will result in a lien on the property at [Property Address]. You may cancel this transaction, without cost, on or before midnight on the third business day after whichever of the following events occurs last:(1) The date on which you signed the contractual assessment.(2) The date you received your Financing Estimate and Disclosure.(3) The date you received this notice of your right to cancel.If you cancel the transaction, [Provider], within 20 calendar days after [Provider] receives notice of cancellation, must take the steps necessary to reflect the fact that, if recorded, the lien on your property has been discharged and removed from the tax rolls, and [Provider] must return to you any money you have given in connection with your application, not including the application processing fee. After [Provider] has done the things mentioned above, you must return any money paid to you or on your behalf, whether to your contractor or any other person. All money must be returned to the address below. | |
| If you cancel the transaction: | |
| ●You will not be charged a cancellation fee; and | |
| ●You will be refunded any money you have given, excluding application and processing fees as applicable. | |
| To cancel this transaction, you may submit this form to [Provider] in writing at: | |
| Provider:__________ | |
| Attn:Right to Cancel Notification | |
| Email:__________ | |
| Fax number:__________ | |
| Address:__________ | |
| Deadline to Cancel: | |
| If you want to cancel this transaction, you must submit this form on or before midnight on the third business day after whichever of the following events occurs last:(1) The date on which you signed the contractual assessment.(2) The date you received your Financing Estimate and Disclosure.(3) The date you received this notice of your right to cancel. | |
| You may use any written statement that is signed and dated by you and states your intention to cancel, or you may use this notice by dating and signing below. If you cancel by mail, fax, or email, you must send the notice no later than midnight of the third business day following the date on which you signed the contractual assessment. If you send or deliver your written notice to cancel some other way, it must be delivered to the above address no later than midnight on the third business day after whichever of the following events occurs last:(1) The date on which you signed the contractual assessment.(2) The date you received your Financing Estimate and Disclosure.(3) The date you received this notice of your right to cancel. | |
| I WISH TO CANCEL | |
| Property Owner | Date |
(B) References to “third” in the notice to cancel document set forth in subparagraph (A) shall be changed to “fifth” for a property owner who is a senior citizen.
(C) The five-day right to cancel added by the act that added subparagraph (B) to this paragraph shall apply to a contractual assessment entered into on or after January 1, 2021.
(2) The property owner is deemed to have given notice of cancellation at the moment that the property owner sends the notice by mail, email, or fax or at the moment that the property owner otherwise delivers the notice, as applicable.
(c) This section only applies to a property owner who seeks to participate in a program established pursuant to this chapter for the purposes specified in paragraph (2) of subdivision (a) of Section 5898.20 or Section 5899, 5899.3, or 5899.4 for a residential property with four or fewer units.
(d) For the purposes of this section, the following definitions apply:
(1) “Property owner” shall include all owners of record.
(2) “Senior citizen” means an individual who is 65 years of age or older.
SEC. 2.
Section 5898.16 of the Streets and Highways Code, as amended by Section 12 of Chapter 158 of the Statutes of 2020, is repealed.
SEC. 3.
Section 5898.17 of the Streets and Highways Code, as amended by Section 13.5 of Chapter 158 of the Statutes of 2020, is amended to read:
5898.17.
(a) The disclosure set forth below, or a substantially equivalent document that displays the same information in a substantially similar format, shall be completed and delivered to a property owner before the property owner consummates a voluntary contractual assessment described in this chapter for purposes specified in paragraph (2) of subdivision (a) of Section 5898.20 or Section 5899, 5899.3, or 5899.4, or a special tax described in Section 53328.1 of the Government Code. The disclosure shall be provided to the property owner as a printed paper copy in no smaller than 12-point type, unless the property owner opts out of receiving a printed paper copy in writing by signing a printed paper document. A property owner who opts out of receiving a printed paper copy of the disclosure shall be provided with an electronic copy in accordance with the Uniform Electronic Transactions Act (Title 2.5 (commencing with Section 1633.1) of Part 2 of Division 3 of the Civil Code). A sample of the disclosure set forth below shall be maintained on a public internet website available to property owners.
(b) (1) This section only applies to disclosure to a property owner who seeks to participate in a program established pursuant to this chapter for the purposes specified in paragraph (2) of subdivision (a) of Section 5898.20 or Section 5899, 5899.3, or 5899.4 for a residential property with four or fewer units.
| Financing Estimate and Disclosure | ||
| Notice to Property Owner: Existing law requires that a printer paper copy of this document be provided to you before reviewing and signing, unless you opt out, in writing, to that printed copy by signing a printed paper document. If you opt out of receiving a printed paper copy of this disclosure, an electronic copy will be provided to you. The financing arrangement described below will result in an assessment against your property which will be collected along with your property taxes and will result in a lien on your property. You should read and review the terms carefully, and if necessary, consult with a tax professional or attorney. | ||
| Customer Service Toll-Free telephone number and email:In the event you have a consumer complaint, questions about your financing obligations related to the contractual assessment or your contractual rights under the terms of this contract, you can contact either this toll-free telephone number or email address provided below and receive a response within 24 hours or one business day.Toll-Free telephone number: ___________Customer service email address: ___________ | ||
| Products and Costs | ||
| Product costs (includinglabor/installation) | $________ | |
| Description1.2.3. | ||
| Financing Costs | ||
| Application fees and costsPrepaid InterestOther CostsTotal Amount Financed | $________$________$________$________ | |
| Annual Percentage Rate (APR)Simple Interest RateTotal Annual Principal, Interest, andAdministrative Fees | ______% ______%$______ | |
| Note: If your property taxes are paid through an impound account, your mortgage lender may apportion the amount and add it to your monthly payment. | ||
| See “Other Important Considerations” below | ||
| Total Amount you will have paid over the life of the financing | $________ | |
| Other CostsAppraisal FeesBond related costsAnnual Administrative feesEstimated closing costsCredit Reporting FeesRecording Fees | $________$________$________$________$________$________ | |
| Total Financing Costs and Closing Costs | $________ | |
| Estimated Cash (out of pocket) to close | $________ | |
| Other TermsPrepayment fee | ◻ NoNo ______ | ◻ Yes ______ |
| Additional Information About These FinancingComparisons[Use this information to compare to other financing options] | ||
| Over the term of the financing | $________ Principal you will have paid off.$________ Amount of interest you have paid.$________ Amount of financing and other costs you will have paid.$________ Total you will have paid. | |
| Annual Percentage Rate | ______% | |
| Total Interest Paid (as a percentage of all the payments you have made) | ______% | |
| Other Important Considerations | ||
| I understand that I may be required to pay off the remaining balance of this obligation by the mortgage lender refinancing my home. If I sell my home, the buyer or their mortgage lender may require me to pay off the balance of this obligation as a condition of sale. | ||
| _____ _______________ _____ [Borrower initials] | ||
| Monthly Mortgage Payments | ||
| Your payments will be added to your property tax bill. Whether you pay your property taxes through your mortgage payment, using an impound account, or if you pay them directly to the tax collector, you will need to save an estimated $_______ for your first tax installment. If you pay your taxes through an impound account you should notify your mortgage lender, so that your monthly mortgage payment can be adjusted by your mortgage lender to cover your increased property tax bill. | ||
| _____ _______________ _____ [Borrower initials] | ||
| Tax Benefits: Consult your tax adviser regarding tax credits, credits and deductions, tax deductibility, and other tax benefits available. Making an appropriate application for the benefit is your responsibility. | ||
| _____ _______________ _____ [Borrower initials] | ||
| Statutory Penalties: If your property tax payment is late, the amount due will be subject to a 10% penalty, late fees, and 1.5% per month interest penalty as established by state law, and your property may be subject to foreclosure. | ||
| _____ _______________ _____ [Borrower initials] | ||
| Three Day Right to Cancel You, the property owner, may cancel the contract at any time on or before midnight on the third business day after the date of the transaction to enter into the agreement without any penalty or obligation. To cancel this transaction, you may mail or deliver a signed and dated copy of the contract with notice of cancellation to:___________ [name of business] at___________ [address]You may also cancel the contract by sending notification of cancellation by email to the following email address: _________________[email address of business]. _____ _______________ _____ [Borrower initials] | ||
| Confirmation of ReceiptThis confirms the receipt of the information in this form. You do not have to accept this financing just because you acknowledge that you have received or signed this form, and it is NOT a contract. | ||
| __________________________[Property Owner Signature - Date] | __________________________[Property Owner Signature - Date] |
(2) References to “three” and “third” in the document set forth in paragraph (1) shall be changed to “five” and “fifth,” respectively, for a property owner who is a senior citizen.
(3) The five-day right to cancel added by the act that added paragraph (2) to this subdivision shall apply to a contractual assessment entered into on or after January 1, 2021.
(c) A public agency or other party to a voluntary contractual assessment described in this chapter for the purposes specified in paragraph (2) of subdivision (a) of Section 5898.20 or Section 5899, 5899.3, or 5899.4, or a special tax described in Section 53328.1 of the Government Code shall not make any monetary or percentage representations of increased value to a property owner regarding the effect the financed improvements will have on the market value of the property unless that public agency or other party derives its estimates of the market value using one of the following:
(1) An automated valuation model, which is a computerized property valuation system that is used to derive a real property value.
(2) A broker’s price opinion conducted by a real estate broker licensed pursuant to Part 1 (commencing with Section 10000) of Division 4 of the Business and Professions Code.
(3) An appraisal conducted by a state licensed real estate appraiser licensed pursuant to Part 3 (commencing with Section 11300) of Division 4 of the Business and Professions Code.
(d) For purposes of this section, “property owner” shall include all owners of record.
(e) For purposes of this section, “senior citizen” means an individual who is 65 years of age or older.
SEC. 4.
Section 5898.17 of the Streets and Highways Code, as amended by Section 14.5 of Chapter 158 of the Statutes of 2020, is repealed.
SEC. 5.
Section 5899.4 of the Streets and Highways Code is amended to read:
5899.4.
(a) (1) It is the intent of the Legislature to provide homeowners and businesses with an affordable way to finance improvements to their homes and buildings that make those facilities more resistant to wildfire by permitting voluntary individual efforts to improve the wildfire resilience and safety of those facilities. The Legislature further intends that this chapter should be used to finance the installation of wildfire safety improvements that are permanently fixed to residential, commercial, industrial, agricultural, or other real property.
(2) The upfront cost of making residential, commercial, industrial, agricultural, or other real property more resistant to wildfire prevents many property owners from making those improvements. To make those improvements more affordable and to promote the installation of wildfire safety improvements, it is necessary to authorize an alternative procedure for authorizing assessments to finance the cost of wildfire safety improvements.
(3) A public purpose will be served by a voluntary contractual assessment program that provides the legislative body of any public agency with the authority to finance the installation of wildfire safety improvements that are permanently fixed to residential, commercial, industrial, agricultural, or other real property.
(b) For purposes of this section:
(1) For the purpose of financing the installation of wildfire safety improvements, “public agency” means a city, county, or city and county. The definition of “city” in Section 5005 shall not apply to this paragraph.
(2) “Wildfire safety improvements” means permanent wildfire resilience and safety improvements fixed to residential, commercial, industrial, agricultural, or other real property. Wildfire safety improvements include, but are not limited to, any improvements identified by the Department of Forestry and Fire Protection and improvements that contribute to the defensible space Zones 1 and 2 of a property, which includes the space between 0 and 100 feet from each side and from the front and rear of the structures, as may be identified by the Department of Forestry and Fire Protection from time to time, that can be fixed to a building or structure. As used in this section, a wildfire safety improvement would include, but not be limited to, a Class A fire-rated roof, enclosed eaves, fire-resistant vents, and multipane windows, including dual pane windows, or functional shutters, which when closed, cover the entire window and do not have openings. As used in this section, wildfire safety improvements that contribute to defensible space do not include brush clearing or other improvements that are temporary in nature unless they are necessary as part of the installation or acquisition of another wildfire safety improvement. A voluntary contractual assessment that finances a wildfire safety improvement shall not be eligible for a waiver of the requirements of paragraph (1) of subdivision (b) of Section 22687 of the Financial Code pursuant to subdivision (e) of Section 22687 of the Financial Code. In order to qualify under this paragraph, a wildfire safety improvement shall be fixed to an existing building or structure, and shall not be used as a part of a project to construct a new home or to rebuild or reconstruct a home that was destroyed or damaged in a fire. A voluntary contractual assessment for wildfire safety improvements entered into pursuant to this section may be used to acquire or construct wildfire safety improvements in connection with the rebuilding or reconstruction of property if the wildfire safety improvements are in addition to or an improvement to, and were not part of, the property as it existed immediately prior to the destruction or damage to the property by fire. property, including:
(A) Class A fire-rated roof.(B) Enclosed eaves.(C) Fire-resistant vents.(D) Multipane windows, including dual pane windows, or functional shutters, which when closed, cover the entire window and do not have openings.(E) Improvements that contribute to the defensible space Zones 1 and 2 of a property, which includes the space between 0 and 100 feet from each side and from the front and rear of the structures, as may be identified by the Department of Forestry and Fire Protection.(F) Any other wildfire safety improvements identified in regulations adopted by the Department of Insurance that require insurers to reflect and take into account specified mitigation factors in their rating plans.
(c) Any public agency that has established a PACE program in accordance with Section 5898.20, 5899, or 5899.3, or a special tax described in Section 53328.1 of the Government Code, may enter into voluntary contractual assessments with property owners to finance the installation of wildfire safety improvements that are permanently fixed to real property pursuant to this chapter.
(d) For purposes of establishing a voluntary contractual assessment program relating to wildfire safety improvements, the legislative body shall make the determinations required pursuant to Section 5898.20 by adopting a resolution indicating its intention to do so. The resolution of intention shall identify the kinds of wildfire safety improvements that may be financed and shall include all of the information that is required pursuant to subdivision (b) of Section 5898.20, including, but not limited to, directing an appropriate public agency official to prepare a report pursuant to Section 5898.22.
(d)
(e) For purposes of the report required pursuant to Section 5898.22, relating to a voluntary contractual assessment program for wildfire safety improvements, the designated public agency official shall satisfy the requirements of paragraph (1) of subdivision (c) of Section 5898.22 by identifying the types of wildfire safety improvements that may be financed through the use of contractual assessments.
(e)
(f) Notwithstanding any other provision of this chapter, upon the written consent of an authorized public agency official, the proposed arrangements for financing the program pertaining to the installation of wildfire safety improvements that are permanently fixed to real property may authorize the property owner to purchase directly the related equipment and materials for the installation of wildfire safety improvements and to contract directly for the installation of wildfire safety improvements that are permanently fixed to the property owner’s residential, commercial, industrial, agricultural, or other real property.
(f)
(g) It is the responsibility of the property owner to contact the property owner’s insurance provider to determine whether the wildfire safety improvement to be financed by the voluntary contractual assessment is covered by the property owner’s insurance plan and whether that improvement will impact the insurance rate.
(h) A voluntary contractual assessment that finances a wildfire safety improvement shall not be eligible for a waiver of the requirements of paragraph (1) of subdivision (b) of Section 22687 of the Financial Code pursuant to subdivision (e) of Section 22687 of the Financial Code.(i) Each program administrator providing wildfire safety improvements shall have a hardship program that includes, but is not limited to, a process for requesting that a program administrator remove the lien if a wildfire destroys the property or improvements.(j) A program administrator providing wildfire safety improvements shall file a report to the appropriate policy committees of the Legislature by January 1, 2030, that includes, but is not limited to, the following information:(1) A description of the product types offered, including, but not limited to, the average cost for each project type, and the city, county, and ZIP Code where they are offered.(2) The number of complaints received for these improvements, including, but not limited to, the number of complaints that were resolved, the number of complaints that were not resolved, and an explanation for why that complaint was not resolved.(3) A description of the hardship program required pursuant to subdivision (i), including, but not limited to, the types of services provided by the program, the number of requests to remove a lien due to damage or destruction in a wildfire, the number of requests approved, and the number of requests denied along with an explanation of the reasons for each denial.(4) Any information specific to wildfire safety improvements included in a report to a public agency pursuant to Section 5954.(k) This section shall remain operative until January 1, 2035, and as of that date is repealed.
SEC. 6.
Section 5899.4 is added to the Streets and Highways Code, to read:
5899.4. (a) (1) It is the intent of the Legislature to provide homeowners and businesses with an affordable way to finance improvements to their homes and buildings that make those facilities more resistant to wildfire by permitting voluntary individual efforts to improve the wildfire resilience and safety of those facilities. The Legislature further intends that this chapter should be used to finance the installation of wildfire safety improvements that are permanently fixed to residential, commercial, industrial, agricultural, or other real property.(2) The upfront cost of making residential, commercial, industrial, agricultural, or other real property more resistant to wildfire prevents many property owners from making those improvements. To make those improvements more affordable and to promote the installation of wildfire safety improvements, it is necessary to authorize an alternative procedure for authorizing assessments to finance the cost of wildfire safety improvements.(3) A public purpose will be served by a voluntary contractual assessment program that provides the legislative body of any public agency with the authority to finance the installation of wildfire safety improvements that are permanently fixed to residential, commercial, industrial, agricultural, or other real property.(b) For purposes of this section:(1) For the purpose of financing the installation of wildfire safety improvements, “public agency” means a city, county, or city and county. The definition of “city” in Section 5005 shall not apply to this paragraph.(2) “Wildfire safety improvements” means permanent wildfire resilience and safety improvements fixed to existing residential, commercial, industrial, agricultural, or other real property. An improvement within the meaning of this paragraph means any of the components identified by the Department of Forestry and Fire Protection at www.readyforwildfire.org/Hardening-Your-Home/, as updated by the Department of Forestry and Fire Protection or at a subsequent internet website than can be fixed to an existing building or structure. A PACE assessment that finances a wildfire safety improvement shall not be eligible for a waiver of the requirements of paragraph (1) of subdivision (b) of Section 22687 of the Financial Code pursuant to subdivision (e) of Section 22687 of the Financial Code. In order to qualify under this paragraph, a wildfire safety improvement shall be fixed to an existing building or structure, and shall not be used as a part of a project to construct a new home or to rebuild or reconstruct a home that was destroyed or damaged in a fire.(c) The legislative body of any public agency that has accepted the designation of Very High Fire Hazard Severity Zone pursuant to Section 51179 of the Government Code may designate an area, in the manner provided pursuant to Section 5898.20, within which authorized public agency officials and property owners may enter into voluntary contractual assessments to finance the installation of wildfire safety improvements that are permanently fixed to real property pursuant to this chapter.(d) For purposes of establishing a voluntary contractual assessment program relating to wildfire safety improvements, the legislative body shall make the determinations required pursuant to Section 5898.20 by adopting a resolution indicating its intention to do so. The resolution of intention shall identify the kinds of wildfire safety improvements that may be financed and shall include all of the information that is required pursuant to subdivision (b) of Section 5898.20, including, but not limited to, directing an appropriate public agency official to prepare a report pursuant to Section 5898.22.(e) For purposes of the report required pursuant to Section 5898.22, relating to a voluntary contractual assessment program for wildfire safety improvements, the designated public agency official shall satisfy the requirements of paragraph (1) of subdivision (c) of Section 5898.22 by identifying the types of wildfire safety improvements that may be financed through the use of contractual assessments.(f) Notwithstanding any other provision of this chapter, upon the written consent of an authorized public agency official, the proposed arrangements for financing the program pertaining to the installation of wildfire safety improvements that are permanently fixed to real property may authorize the property owner to purchase directly the related equipment and materials for the installation of wildfire safety improvements and to contract directly for the installation of wildfire safety improvements that are permanently fixed to the property owner’s residential, commercial, industrial, agricultural, or other real property.(g) It is the responsibility of the property owner to contact the property owner’s insurance provider to determine whether the wildfire safety improvement to be financed by the PACE assessment is covered by the property owner’s insurance plan and whether that improvement will impact the insurance rate.(h) This section shall become operative on January 1, 2035.
SEC. 6.SEC. 7.
Section 5902 of the Streets and Highways Code, as amended by Section 13 of Chapter 837 of the Statutes of 2018, is amended to read:
5902.
For purposes of this chapter:
(a) “Assessment contract” means an agreement entered into between all property owners of record on real property and a public agency in which, for voluntary contractual assessments imposed on the real property, the public agency provides a PACE assessment for the installation of one or more efficiency improvements on the real property in accordance with a PACE program, specified in paragraph (2) of subdivision (a) of Section 5898.20 or Section 5899, 5899.3, or 5899.4, or a special tax described in Section 53328.1 of the Government Code.
(b) “Authorized representative” means an attorney-in-fact, as defined in Section 4014 of the Probate Code, or conservator of the estate, as defined in Section 2400 of the Probate Code, of the property owner.
(c) “Efficiency improvement” means one or more permanent improvements fixed to real property.
(d) “PACE assessment” means a voluntary contractual assessment, voluntary special tax, or special tax, as described in subdivisions (a), (b), and (c) of Section 26054 of the Public Resources Code.
(e) “PACE program” means a program in which financing is provided for the installation of efficiency improvements on real property and funded through the use of property assessments, as well as other program components defined in this section, established pursuant to any of the following:
(1) Chapter 29 (commencing with Section 5898.10) of Part 3 of this code.
(2) The Mello-Roos Community Facilities Act of 1982 (Chapter 2.5 (commencing with Section 53311) of Part 1 of Division 2 of Title 5 of the Government Code).
(3) A charter city’s constitutional authority under Section 5 of Article XI of the California Constitution.
(f) “Program administrator” means an entity administering a PACE program on behalf of, and with the written consent of, a public agency.
(g) “Property owner” means all property owners of record on the property subject to the PACE assessment.
(h) “Public agency” means a city, including a charter city, county, city and county, municipal utility district, community services district, community facilities district, joint powers authority, sanitary district, sanitation district, or water district, as defined in Section 20200 of the Water Code, that has established or participates in a PACE program, and utilizes a program administrator.
SEC. 7.SEC. 8.
Section 5902 of the Streets and Highways Code, as added by Section 14 of Chapter 837 of the Statutes of 2018, is repealed.
SEC. 8.SEC. 9.
Section 5913 of the Streets and Highways Code, as amended by Section 4 of Chapter 156 of the Statutes of 2020, is amended to read:
5913.
(a) (1) Before a property owner executes an assessment contract the program administrator shall do the following:
(A) Make an oral confirmation that at least one owner of the property has a copy of the contract assessment documents required by paragraph (2) of subdivision (a) of Section 5898.20 or Section 5899, 5899.3, or 5899.4, or Section 53328.1 of the Government Code, as applicable, with all the key terms completed, the financing estimate and disclosure form specified in Section 5898.17, and the right to cancel form specified in Section 5898.16, with hard copies available upon request.
(B) Make an oral confirmation of the key terms of the assessment contract, in plain language, with the property owner on the call or to a verified authorized representative of the owner on the call and shall obtain acknowledgment from the property owner on the call to whom the oral confirmation is given.
(2) The oral confirmation required pursuant to paragraph (1) shall include, but is not limited to, all of the following information:
(A) The property owner on the call has the right to have other persons present for the call, and an inquiry as to whether the property owner would like to exercise the right to include anyone else on the call. This shall occur at the onset of the call, after the determination of the preferred language of communication.
(B) The property owner on the call is informed that they should review the assessment contract and financing estimate and disclosure form with all other owners of the property.
(C) The efficiency improvement being installed is being financed by a PACE assessment.
(D) The total estimated annual costs the property owner will have to pay under the assessment contract, including applicable fees.
(E) The total estimated average monthly amount of funds the property owner would have to save in order to pay the annual costs under the PACE assessment, including applicable fees.
(F) That the county annual secured property tax bill, which will include the installment of the PACE lien, will be mailed by the county tax collector no later than November 1 each year, and that if the lien is recorded after the fiscal year closes but before the bill is mailed, the first installment may not appear on the county tax bill until the following year.
(G) The term of the assessment contract.
(H) That payments on the assessment contract will be made through an additional annual assessment on the property and paid either directly to the county tax collector’s office as part of the total annual secured property tax bill, or through the property owner’s mortgage impound account, and that if the property owner pays taxes through an impound account, the property owner should notify the property owner’s mortgage lender to discuss adjusting the monthly mortgage payment by the estimated monthly cost of the PACE assessment.
(I) That the property will be subject to a lien during the term of the assessment contract and that the obligations under the assessment contract may be required to be paid in full before the property owner sells or refinances the property.
(J) That the property owner has disclosed whether the property has received or is seeking additional PACE assessments and has disclosed all other PACE assessments or special taxes that are or about to be placed on the property, if known to and understood by the property owner.
(K) That any potential utility savings are not guaranteed, and will not reduce the assessment payments or total assessment amount.
(L) That the program administrator and contractor do not provide tax advice, and that the property owner should seek professional tax advice if the property owner has questions regarding tax credits, tax deductibility, or of other tax impacts on the PACE assessment or assessment contract.
(M) That if that property tax payment is delinquent within the fiscal year, the county tax collector will assess a 10-percent penalty and may assess related costs, as required by state law. A delinquent payment also subjects the property to foreclosure. If the delinquent payment continues past June 30 of a given year and defaults, the county tax collector will assess penalties at the rate of 1 ½ percent per month (18 percent per year), and the property will continue to be subject to foreclosure and may become subject to the county tax collector’s right to sell the property at auction.
(N) That the property owner has a three-business day right to cancel the assessment contract pursuant to subdivision (b) of Section 5898.16, and that canceling the assessment contract may also cancel the home improvement contract under Section 5940.
(O) That it is the responsibility of the property owner to contact the property owner’s home insurance provider to determine whether the efficiency improvement to be financed by the PACE assessment is covered by the property owner’s insurance plan.
(P) That the property owner may repay an amount owed pursuant to an assessment contract before the date that amount is due under the contract without early repayment penalty.
(b) The program administrator shall comply with the following when giving the oral confirmation described in subdivision (a):
(1) The program administrator shall record the oral confirmation in an audio format in accordance with applicable laws.
(2) The program administrator may not comply with the requirement in subdivision (a) through the use of a prerecorded message, or other similar device or method.
(3) Recording of an oral confirmation shall be retained by the program administrator for a period of at least five years from the time of the recording.
(c) The provisions of this section shall be in addition to the documents required to be provided to the property owner under Sections 5898.16 and 5898.17.
(d) At the commencement of the oral confirmation, the program administrator shall ask if the property owner on the call would prefer to communicate during the oral confirmation primarily in a language other than English that is specified in Section 1632 of the Civil Code. If the preferred language is supported by the program administrator, the oral confirmation shall be given in that primary language, except where the property owner on the call chooses to communicate through the property owner’s own interpreter. If the preferred language is not supported and an interpreter is not chosen by the property owner on the call, the PACE assessment transaction shall not proceed. For purposes of this subdivision, “the property owner’s own interpreter” means a person, who is not a minor, is able to speak fluently and read with full understanding both the English language and any of the languages specified in Section 1632 of the Civil Code, and who is not employed by, and whose services are not made available through, the program administrator, the public agency, or the contractor.
(e) (1) Beginning on January 1, 2019, if the oral confirmation was conducted primarily in a language other than English that is specified in Section 1632 of the Civil Code, the program administrator shall deliver in writing the disclosures and contract or agreement required by law, including, but not limited to, the following:
(A) Assessment contract documents specified in paragraph (2) of subdivision (a) of Section 5898.20 or Section 5899, 5899.3, or 5899.4, or a special tax described in Section 53328.1 of the Government Code.
(B) The financing estimate and disclosure form specified in Section 5898.17.
(C) The right to cancel form specified in Section 5898.16.
(2) Before the execution of any contract or agreement described in paragraph (1), the program administrator shall deliver a translation of the disclosures, contract, or agreement in the language in which the oral confirmation was conducted, that includes a translation of every term and condition in that contract or agreement.
SEC. 9.SEC. 10.
Section 5913 of the Streets and Highways Code, as amended by Section 5 of Chapter 156 of the Statutes of 2020, is repealed.
SEC. 10.SEC. 11.
Section 5954 of the Streets and Highways Code, as amended by Section 265 of Chapter 497 of the Statutes of 2019, is amended to read:
5954.
(a) For each PACE program that it administers, a program administrator shall submit a report to the public agency no later than February 1 for the activity that occurred between July 1st through December 31st of the previous year, and another report no later than August 1 for the activity that occurred between January 1st through June 30th of that year. Those reports shall contain the following information, along with all methodologies and supporting assumptions or sources relied upon in preparing the report:
(1) The number of PACE assessments funded, by city, county, and ZIP Code.
(2) The aggregate dollar amount of PACE assessments funded, by city, county, and ZIP Code.
(3) The average dollar amount of PACE assessments funded, by city, county, and ZIP Code.
(4) The categories of installed efficiency improvements whether energy or water efficiency, renewable energy, wildfire safety improvements, or seismic improvements, and the percentage of PACE assessments represented by each category type, on a number and dollar basis, by city, county, and ZIP Code.
(5) The definition of default used by the program administrator.
(6) For each delinquent assessment:
(A) The total delinquent amount.
(B) The number and dates of missed payments.
(C) ZIP Code, city, and county in which the underlying property is located.
(7) For each defaulted assessment:
(A) The total defaulted amount.
(B) The number and dates of missed payments.
(C) ZIP Code, city, and county in which the underlying property is located.
(D) The percentage the defaults represent of the total assessments within each ZIP Code.
(E) The total number of parcels defaulted and the number of years in default for each property.
(8) The estimated total amount of energy saved, and the estimated total dollar amount of those savings by property owners by the efficiency improvements installed in the calendar year, by city, county, and ZIP Code. In addition, the report shall state the total number of energy savings improvements, and number of improvements installed that are qualified for the Energy Star program of the United States Environmental Protection Agency, including the overall average efficiency rating of installed units for each product type.
(9) The estimated total amount of renewable energy produced by the efficiency improvements installed in the calendar year, by city, county, and ZIP Code. In addition, the report shall state the total number of renewable energy installations, including the average and median system size.
(10) The estimated total amount of water saved, and the estimated total dollar amount of such savings by property owners, by city, county, and ZIP Code. In addition, the report shall state the total number of water savings improvements, the number of efficiency improvements that are qualified for the WaterSense program of the United States Environmental Protection Agency, including the overall average efficiency rating of installed units for each product type.
(11) The estimated amount of greenhouse gas emissions reductions.
(12) The estimated number of jobs created.
(13) The average and median amount of annual and total PACE assessments based on ZIP Code, by city, county, and ZIP Code.
(14) The number and percentage of homeowners over 60 years old by city, county, and ZIP Code.
(15) The total number of wildfire safety improvements, including the average cost of each product type.(16) The estimated total amount of savings produced by the wildfire safety improvements installed in the calendar year, by city, county, and ZIP Code. This estimated savings may include estimates for property losses avoided or estimates for reductions in insurance premiums.
(b) All reports submitted pursuant to this section shall include only aggregate data, and shall not include any nonpublic personal information.
(c) A public agency that receives a report pursuant to this section shall make the data publicly available on its internet website.
(d) This section does not limit another governmental or regulatory entity from establishing reporting requirements.
SEC. 11.SEC. 12.
Section 5954 of the Streets and Highways Code, as added by Section 18 of Chapter 837 of the Statutes of 2018, is repealed.