The Florida PACE Funding Agency has its eyes on the Florida Supreme Court to keep from losing millions of dollars as tax collectors across the state refuse to place the agency’s assessments on the tax roll—preventing collection of funds.  

Alachua County Tax Collector John Power announced in June that his office would not place assessments on the roll, and tax collectors in Volusia, Duval, Pasco, Palm Beach and Hillsborough counties have taken the same stance.  

Not able to collect the funds, Florida Pace Funding Agency risks losing financing and says homeowners could lose an option to pay for roofs, air conditioning units and solar panels. The next step according to Mike Moran, the agency’s executive director, is the Florida Supreme Court.  

In a Monday press conference, Moran said the tax collectors are going outside their purview and impeding a program that the Florida Legislature has called a statewide public interest.  

He added that the decision by the tax collectors also undermines how other special districts in Florida collect funds. As of Sept. 5, Power had 52 assessments blocked.  

“This is one more example of politicians thinking they know better than the free marketplace,” Moran said in a press release. “These are elected officials trying to take away a voluntary financing option for Florida families. This disregard for the law creates a looming housing crisis in the state and we are committed to taking it to the Supreme Court to protect the rights of these businesses and homeowners.” 

The Florida PACE Funding Agency started suing once certain tax collectors began blocking assessments, and so far, the courts have mostly ruled in favor of the tax collectors—denying the agency’s request to force the assessment in Alachua, Bradford, Hillsborough, Volusia and Union counties.  

A Sarasota County judge initially ruled against the tax collector there, but the case has since been reopened, according to Jon Costabile, chief deputy at the Alachua County Tax Collector’s Office.  

About PACE programs 

The agency is one of several organizations that manage the property assessed clean energy (PACE) program in the state. The agency pays contractors, chosen by the homeowner, for energy efficiency upgrades then collects the funds through the annual property taxes, administered by the tax collector.  

Moran said when an issue appears, like a leaky roof, most homeowners lack cash to simply cover the cost of a new roof. He said that leaves two real options: going into unsecure debt like a credit card with interest rates as high as 29%, or the PACE program that caps interest at 9%.  

The issue stems from different interpretations of a Leon County judge’s bond validation order and the necessity of interlocal agreements.  

The bond validation order happened in October 2022. Before then, the Florida PACE Funding Agency signed interlocal agreements with cities and counties before administering the program in a particular area. 

Some counties decided not to sign the agreements, preventing the program from entering that market. Others, like Alachua County, signed agreements but then let the contracts expire at the end of the term. 

Critics of PACE funding say the program lacks consumer protections, putting citizens in a contract that they don’t fully understand. The landing page for Columbia County shows a hard-to-miss yellow consumer alert: “The board did not authorize PACE loans to homeowners in Columbia County because they increase your tax assessment and put your home at risk.” 

Alachua County also sent out consumer protection warnings about PACE, but Moran touted the agency’s protections that go beyond state regulations.  

He said each homeowner has a phone call to discuss the details of the contract, like how much the annual property taxes will increase. The phone call is recorded, and Moran said the homeowner must call the Florida PACE Funding Agency to authorize payment to the contractors.  

Moran added that the agency isn’t allowed to levy property tax assessments for longer than the useful life of the product or collect more than 20% of the just value of the home—available at the property appraiser’s website.

Difference of interpretation  

When the bond validation hearing happened in Leon County, Moran said the agency was allowed to ask the judge anything related to the collection process. He said the agency asked if the Florida PACE Funding Agency needed interlocal agreements and if tax collectors are allowed to refuse the assessments. The answer from the judge was no on both questions, according to Moran.

With the bond validation in hand, the agency hit the ground running across the state—from Columbia County, where an agreement had never been in place, to Alachua County, where the agreement had lapsed, to counties with current agreements with the agency.

“When the gavel hit from that judge in October of 2022, we were not required to do interlocal agreements,” Moran said in response to why the agency had allowed the agreement in Palm Beach Coast to expire.  

Counties have countered that the bond validation ruling fails to give authority to operate statewide and without interlocal agreements. Sylvia Torres, attorney for Alachua County, sent a cease-and-desist letter to the agency in May and noted the difference of interpretation.  

Judges who ruled in favor of the tax collectors said the bond validation order only touched interlocal agreements as a collateral and not binding issue.  

“This Court finds that Petitioner has not established a clear legal right to unilaterally levy non-ad valorem assessments in Alachua County,” Alachua County Judge Donna M. Keim said in her October order.  

Moran said as counties challenge the bond validation order, the next step as he understands is an appeal to the Florida Supreme Court.

Editor’s note: This story has been updated.