Application denied.
Salt Lake County won't get the chance to lend thousands of dollars in low-interest loans to homeowners who want to replace drafty windows, upgrade a furnace or put solar panels on the roof.
A bill that would have made those loans possible never reached a Utah Senate vote, largely because of the lobbying efforts of the Utah Banking Association.
"If a homeowner is credit-worthy, they should get that loan from a bank or a credit union," said Howard Headlee, president of the Utah Bankers Association. "If they are not credit-worthy, the county should not be giving them a loan that takes top priority."
It's a setback for the county, which has lobbied for the loan program as a way to overcome the financial barriers that often stand in the way of energy retrofits.
"Obviously, we are disappointed that it isn't going to make it through the legislative session," Mayor Peter Corroon said. "We can still find ways to achieve what we are looking for in a different manner. We thought it was a good economic development bill, a good energy-efficiency bill and a good-renewable energy bill."
Under the program, not only could residents borrow money at the same interest rate as government, but they also could pay it back on their property taxes. The debt then would stay with the house, meaning that the loan could pass from seller to buyer as the home changes hands.
Sara Baldwin, senior policy and regulatory associate for Utah Clean Energy, says the program could save energy and, ultimately, keep utility rates in check by reducing demand. Even though the bill stalled in the Legislature this year, she hopes to see it return.
"Right now, we are not seeing banks lend money for energy-efficient projects in any significant way," Baldwin said. "There is a market niche that could be filled and should be filled."
But the banking community has resisted the idea. It could take away business from banks and credit unions. It also could lead to property liens if borrowers don't make their payments. And it could result in higher interest rates from lenders who worry their loans might become secondary to government loans.
Can the program be changed to win the banking association's support? Not likely.
"You really can't fix it," Headlee said.
But Kimberly Barnett, Corroon's environmental policy coordinator, said the county isn't giving up yet.
If banks and credit unions don't feel comfortable having government administer a low-interest loan program for energy makeovers, then maybe the county can help them devise a program of their own.
"We want to sit down at the same table and see if there is a Plan B," Barnett said. "There is a need out there that we need to fill."
