Modesto, CA Financing property improvements - solar, roofing, building upgrades, plumbing & structural - for churches, private schools, houses of worship, and nonprofit organizations.
Dispelling a common solar financing myth: The myth is that project financing sources avoid religious institutions because they do not like the financial and credit risk, and they are averse to potentially "foreclosing on god". To the contrary - both PACE and PPA investors view houses of worship as excellent, low-risk financing customers, and have financed hundreds of such projects across California, and around the country.
Due diligence on the financing provider: Boards & leadership of houses of worship should focus on talking to experienced institutional financing providers, with a substantial track record financing houses of worship. Be alert that there are start-up groups with limited or no track record, that will seek to get customers under contract to take them off the market, while they commence a search for investors. We always recommend working with institutions that have financed commercial projects in scale (100s of projects & $100+ million of commercial financing transacted).
Nonprofit customers can generate cash flow from financing solar projects in California without the investment tax credit. As noted in the video - there are investment structures that enable the financing company to monetize the tax credit and pass on a lower cost of financing to the customer. At Technology Credit Corporation, we financed hundreds of projects like this under our Power Purchase Agreement (PPA) structure.
However, there are other financing solutions in addition to PPAs. PPAs are more complex to finance - and there are very few investors that have transacted these projects beyond a few pilot projects.
PACE lenders also provide long-term (20-25 year) capital at a lower capital cost. Many houses of worship have financed projects using PACE financing. This enables projects to move forward with zero upfront cost and deliver cash flow from day 1 for the nonprofit customer. With PACE financing, the lower cost of funds typically more than offsets the tax credit impact in a PPA -- and the underwriting, contracting and funding process is significantly streamlined.
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