February 23, 2011 – Volume 13, Issue 10
I N · T H I S · I S S U E


Pondering the FHFA Position

Three of my meetings on the trep were about PACE, preparing for the PACE Solutions conference in early March.

PACE stands for Property Assessed Clean Energy financing -- a mechanism whereby cities or counties make money available to their residents for energy upgrades, and then are paid back through a property tax assessment. EcoMotion is particularly pleased to be involved in this conference, since PACE financing could enable many more of the kinds of projects we help develop and manage.

What happened to this most promising form of land-secured financing for energy efficiency and solar? It sprang forth with such great potential, and then was dealt a near-knockout blow by the Federal Housing and Finance Agency.

Assessments have been used by local governments for a century. Over 37,000 land secured assessment districts already exist and are a safe and familiar tool for municipal finance. But in late spring and summer of 2010, the FHFA issued advice letters to its mortgage lenders telling them not to buy mortgages encumbered by PACE liens.

Within months, many planned and fledgling residential PACE programs were abruptly terminated.

I began to dig in on the FHFA. Why did FHFA deliver a crippling blow to PACE? Its position is illogical: In a properly structured program, PACE savings are equal to or exceed the monthly payment for the improvement. Why had FHFA driven a deathly blow to the one form of assessment that actually helps the homeowner pay his or her mortgage?

Did FHFA act on its own or was it pressured from above, or externally? Did Tim Geitner strike down PACE “in mortal fear of repeat of the sub-prime market?” Were solar leasing companies blocking this new form of consumer empowerment? Was the FHFA edict a first attack on assessments? Is it, or is it not, a state’s right to define public benefits and to thus exercise its assessment options accordingly?

Could legal counsels in 24 states plus the District of Columbia have it all wrong? They’d been placing assessments on properties for years without concern from Fannie Mae and Freddie Mac.

So what was FHFA’s motive, or drive? Why couldn’t a win-win solution be crafted? Why had discussions of loan loss reserves and strict underwriting standards fall flat? Speculation focuses on its General Counsel, Alfred Pollard. He’s been called a “curmudgeon” and accused of “speaking with forked tongue.” One first-hand sense is that he has acted on his own, that he seems to enjoy the battle, the power, and the control. Could this be true?

If so, imagine the power of one man to shut down an industry, to stem tens of billions of dollars of investment in energy efficiency and renewable power. Imagine one man being able to curtail hundreds of billions of dollars of consumer savings over the life of the measures. Imagine one man holding back 100,000s of metric tonnes of carbon dioxide savings. Imagine one man making our country less secure due to dependence on foreign energy sources.

“Ted Flanigan?” A strong voice on the line in my office. “Yes,” I replied. “This is Al Pollard.” He was calling about our upcoming PACE Solutions conference.
"A week in the life of Ted Flanigan. This time, leaving 78 degrees and clear sunshine, and headed back to the cold with an "impacted schedule."
Jet Blue to its JFK Base

Flight to JFK delayed. This time a flight crew with inadequate layover time. Don’t remember flight crews being the limiting factor years ago. It was again on my way home a week later.

Heading New England packed with a broad spectrum of clothes, from a suit to winter gloves and boots. What a winter back East, shattering records and bursting city snow removal budgets and testing the mettle of the hardy souls that call it home. After retrieving my bag, hopping AirTran, and succeeding at the car rental, I did make it home just 5 minutes before Mark and Seely arrive. Mom is a great hostess; the fire is lit and the smells of her dinner cooking waft through the house.

From a Town Known as Oyster Bay, Long Island

Oyster Bay is a charming north shore town. The oyster company still operates; Jacobsen’s Shipyard overhauls the tugs that work New York Harbor. A bar in the downtown is where Billy Joel got his start and wrote Piano Man. My family has lived there since 1921; five generations have gathered there for Thanksgiving. Now, Oyster Bay is under a huge blanket of snow and ice.

Oyster Bay was Teddy Roosevelt’s home. His house, Sagamore Hill, now a historic site. There, one can appreciate Roosevelt’s penchant for big game hunting. I’ve just read “The River of Doubt,” a gripping story of Theodore Roosevelt’s harrowing and life-threatening adventure deep in the Amazon, pioneering a new 1,200 mile route. What bravado! Like George Bush Jr. getting in a space capsule to explore the Milky Way.

Roosevelt’s summer White House was in downtown Oyster Bay, across from Nobmans Hardware where I was lucky to work. It was a coveted job in town. Mr. Nobman (Walt to a special few) was a master of hardware. He knew it and taught it and loved it and sold it. Nobmans had it all, from plumbing and electric parts, outboard motors and chain saws, to special screws and fittings. I remember cutting glass and keys, mixing paint, assembling lawn mowers for sale. I’d soaked it in. I asked Mr. Nobman his advice on college. He told me that he learned at the School of Hard Knocks. I had asked where that was..

Babylon and Green Home Energy

PACE has huge potential as a financing means for energy efficiency upgrades. And PACE is back in the spotlight, with exciting commercial projects and new residential developments. I’ve been intrigued by the PACE residential model operating in Babylon, New York. Yes, operating.

The program is spearheaded by Dorian Dale, a man who has become known as a witty PACE spokesperson, certainly a character of interest in the PACE advocacy movement. We’ve prepared a short video on his “first-position” program for the conference.

Monday morning and I’m rolling at eight. I drive south through Syosset and head toward Massapequa and the south shore. Snow is piled high. Massive channels are cut in the heavy snow for sidewalks and driveways. Roads are constricted with uneven, thick and treacherous black ice. Parking is over the top. I am impressed by the fortitude of New Yorkers. This is tough stuff.

Dorian Dale heads up the new and exciting Long Island Green Homes Program. He gives full credit to his boss, Supervisor Steve Bellone, who pulled him from his role as househusband to become the town’s Energy Director.

When Dorian first worked for Babylon, he’d been fighting offshore wind. He successfully argued that repowering three aging power plants on Long Island would provide much more cost-effective carbon offsets. Using best available technologies, the offsets were many times that of the controversial wind farm.

Bellone and Dale then turned their attention to the housing stock, struck by the sustainable financing district being developed by the City of Berkeley, California. Why not use reserves from Babylon’s solid waste incinerator and lend it to residents for basic weatherization measures? By managing the process – from audit to contractor and installation and loan with monthly billing– the Town could reap huge efficiency gains while helping residents get energy costs in check.

They did it: First they expanded the definition of solid waste to include carbon to gain the statutory authority to use the solid waste facility reserve to mitigate this waste. The reserve was only earning 1.6%, so the Town decided to put it to work and lend it at 3%. Dale established a contractor network for audits and insulating attics, installing new windows, etc. These basic weatherization measures have an average Savings to Investment ratio of 2, meaning that on a monthly basis the savings are twice the loan payment.

Long Island Green Homes is unique among PACE programs in that a lien is not placed on the home unless there is a problem. Instead, the customer signs a contract to make payments to the solid waste fund. In the event of a delinquency, or default on payments (and ultimately foreclosure), a lien would be placed on the property and it would be senior to the home mortgage. With 678 projects complete and going strong, there has not been a single customer incident requiring a lien.

East Woods Solar

It’s Monday evening and I’m back in Oyster Bay and walking in the front doors of my elementary school. How small the headmaster’s office seems now. Back in the halls of the school where I had grown up. My head was flooded with memories of Bartlett, Beers, Brengle, Frothingham, Smythe, and Beaulieu.

East Woods is now part of the Green Alliance of schools, committed to preserving the environment. That evening, and at the school’s request, EcoMotion’s Senior Business Associate Mark Hopkinson presented our team’s preliminary technical and financial solar feasibility analysis to the Board of Trustees. The Board wanted the straight scoop on costs, financing options, and returns above and beyond the environmental and educational benefits of doing so. I saw a few old classmates and met the new guard.

We’d done a site visit to measure and evaluate the solar potential and conditions. Long Island Power Authority incentives provide a modestly sized system with healthy returns, whether structured either as a non-profit or for-profit arrangement. We’ve also discussed a donation strategy with the school to sweeten the returns and resonate with those most concerned about capital expenditures.

The Board clearly is leaning green, only held back by near universal limiting factor of money. If the Facilities Committee elects to move forward, next steps will include structural and roofing analysis and securing investment-grade bids for the job. Then EcoMotion will take the detailed benefit/cost scenario to the Board for approval and implementation.

Tuesday morning rush hour and I drive into Manhattan taking the LIE, known to some as the Long Island Distress-way. I am not alone. The traffic gets rough at the Midtown Tunnel, and then rougher in Manhattan. I dump the car.

“It was pretty much just you,” noted our consulting client nonchalantly. His progress was huge and he was responding to my question of whether he had used other consultants. No, he’d taken our concepts and run. He put color photos of three major solar systems on the table between us, over 1.8 MW of combined solar capacity. Per plan, he’s selling power services to select customers.

They’d formed a LLC and are squarely in the solar business and it is more profitable than their real estate ventures. Management has given him the green light to significantly expand his solar portfolio. We agreed to explore additional investment opportunities.

My cousin John Sands is 6 foot 8 and is truly a gentle giant. His red hair makes him stand out that much more, especially when he lived and worked in Hong Kong years ago as a bouncer and jazz pianist. He now runs his own company within IMG Music.

I cab cross town to his offices on the West Side. Just off the avenues there are still piles of snow and snow and ice-packed streets. John’s building has an elevator operator who greets and sits on a stool. I’m reminded of our elevator operator John at 901 Lexington as a kid, and the moment he told my father, Billy, and me that Kennedy had been shot.

Cousin John has musicians around the country providing him with music for his library, music that he owns and then licenses to IMG for its use on TV shows, things like the Super Bowl and New York Marathon. John is one huge guy in my estimation. In this business he’s filling a very clever niche. We share sushi and talk family.

Meeting Under the Clock

When you say let’s meet under the clock at Grand Central, the New Yorker says ”OK.” We all have a distinct image in our minds of a huge clock at Grand Central. David called my cell at the prescribed time. “Where are you?” he asked. “Under the clock,” I insist!

I could make him out in the crowd just a few feet away at the information booth. It’s adorned with a clock too. He was puzzled, but I’d confirmed my supposition with an accented policeman. “What happened to the clock?” It was removed a couple years ago. “Safety maybe.” It hung right here. I was under the clock.

David Gabrielson heads up PACE Now, a lobbying group established by a New York lawyer Jeffrey Tannenbaum and Fir Tree Partners. It is funded by the Doris Duke Foundation. David is a councilman from the Town of Bedford, New York, and is driving for a legislative solution for PACE in the Congress. Later in the week, he was hosting a Congressional staff briefing on the Hill in DC. Later I found out he had 90 strong in attendance. This afternoon, David and I swap notes, talk PACE, and share coffee. He’s coming to Palm Desert in March, speaking on two panels at the PACE Solutions conference.

I cross town again and meet with another client. We’d lost a bid on a solar project here and now I find that the winning bidder’s bid was indeed too good to be true. This West Side office window has a majestic view of the Hudson. My colleague points out where the US Air flight commanded by Sully landed in the river, and then floated with the current to 42nd street as the rescue of its passengers took place on national TV.

Life-Long Career Counseling

This trip was all about networking, so you won’t be surprised that while I was in town, I met with my life-long “career counselor.” Years ago we made the unique commitment to check in on each other’s careers periodically, asking tough questions, and making sure that we were clear in perspective and ideally aligned with the objectives of our livelihoods.

Cynthia lives in Manhattan, works for Verizon, is a proud member of New York’s Tall Club, a Dartmouth-educated Jamaican. We’ve had this unusually productive and important relationship for nearly 15 years. We’re committed to examining on a regular basis the value of our careers to our lives.

Some years ago, Cynthia flew to Colorado for an EcoMotion backpacking retreat. It was late in the season and we found ourselves camping in the snow. This blew Cynthia’s mind! She’ll never forget how good the hot springs of Glenwood felt. Our Thai friend Mem was also on the trip. What good sports.

Cynthia and I first met at Kripalu, a spiritual center in Lenox, Massachusetts near Tanglewood and at a workshop specifically focused on aligning our work with values. Deep Pak Chopra was a featured presenter; many others did indeed influence my thinking. Interactive break-out sessions were most useful. Cynthia and I were in a three-some lying flat on our backs with our heads touching. It was an exercise that I will never forget.

The first step was to take ten minutes and think of the three or four individuals that you respect the most. I was awash in thoughts of Jimmy Carter, my father-in-law, Mr. Dudley, and Dr. Murison. The next ten minutes was a focus on the three or four traits that define each of these individuals. We wrote them all down. Of course, taken together these traits define who you want to be!

This time we met at Union Square at a trendy grill. We talk EcoMotion, and balance, and Verizon, and balance, and life, and balance. We talk family and toast. There is compassion mixed with pointed questions and smiles. I am reminded about how much I love my work, and how enlightened she is, and how lucky I am to have this special and enduring bond. We’d simply asked for it without knowing its value.

EcoMotion Campus Services

The Park Central Hotel across the street from Carnegie Hall. My fifth floor room looks up Seventh Avenue and into Central Park. So far, it’s been a quiet place for a conference call, a short rest, and hot shower. Forty three bucks for valet parking.

Four AM and the wind is whipping up Seventh Avenue as I get into the car. With the wind chill, it’s about zero degrees. I go west, up the Hudson River Drive to the Cross Bronx and northeast on 95 to New England and ultimately Boston.

Rhonda Pieroni has been at Fisher College for over 20 years and has the office to show. Fisher is in the back bay, an urban college made up of brownstones linked together. Rhonda’s office must have been a drawing room of note at one point, with marble columns, parquet floors, and trim to the nails.

We discuss EcoMotion’s greening works on campus. We’re in the first year of our work there, catalyzing student action, promoting recycling, a water fountain was installed to refill re-usable water bottles. Like many clients, Rhonda wants it all yesterday. Sierra has established an Eco-Reps program at Fisher. They’ve recently come up with the slogan of, “Engaging green minds at Fisher.” A new logo will be used for branding of all kinds.

Emerson College faces out to the Boston Common. After visiting Fisher, we have two meetings there. Thanks to its able Facilities Director, Emerson is well on its way to sustainability. Its new LEED building is magnificent, powered completely with purchased wind. But the only student link to sustainability was a recent petition to serve free-range chicken eggs in the cafeteria. We meet with the head of facilities and the head of special projects for the President. The college is committed to going green, cost effectively.

EcoMotion Campus Services is designed for New England colleges and prep schools, schools that cannot afford full time sustainability coordinators. We swoop in with a toolkit, offering Gold, Silver, and Bronze levels of service to advance sustainability positions on campus. EcoMotion’s services range from technical – efficiency and renewable energy analyses – to policy and curriculum.

We specialize in galvanizing student action. One student contest run by now EcoMotion staff was an inter-dormitory energy challenge. It saved Wheaton College $13,000 in a single month. At Fisher, half of the student body signs a green pledge drafted by EcoMotion to take action. Chad Mirmelli has just joined our campus service staff.
The Mini-Reunion

My elementary school class was made up of 11 boys. Five of them settled in and around Boston. I started with a few e-mails, and then calls. Chris offered up his Charleston Navy Yard condo for the first round. We’d then hit a local bistro.

What a night! I hadn’t seen Chris or Arthur in 35 years; Wisner for at least 20. They rarely see each other. Chris runs a biomedical research company with a tumor bank; Art is into robotics; Foerd is all about ocean wave energy. I thank Wisner for teaching me the spirit of competition and teamwork. Stephen surprises us by coming up from New York. He’s now working on concentrating solar.

Excited yes, and I’d been a bit apprehensive about the gathering. Would we run out of things to say after formalities? Hah. We were all struck by how easily we reunited. It was really fun, and fulfilling, both light and profound. And why had it been so long? We vowed not to let it happen again as we part in the cold of the Navy Yard and the frozen Charles.

The dogs have won the lottery at Mike and Rosemary’s home away from home in Boston. Having sailed the Greek Islands with them, and staying in close touch with Mike for 30 years, we are family. I’m ever-more inspired by Mike’s art. He shows me recent paintings, from his abstracts to showy renditions of 1950s pin-up girls. So refreshing: These friends live and breathe art; their home is a gallery.

I head north of Boston into New Hampshire, heading “home” to Vermont. The sun is shining and the drive that I’d feared was gorgeous. I pass the landmark state liquor store and head towards Concord, and then northwest to Hanover. I love the forests of Hampshire and honk my horn as I cross the Connecticut River into Vermont.

Burlington by 1:00. Russell and Hermine take me to the boys’ elementary school, the end-of-the-week assembly. A small sea of smiling faces bounds in and then tunes in to the Principal. He leads with grace. He recognizes student accomplishments, sometimes with silent clapping. Russell and I then head off down Champlain Street for a meeting at VEIC.

VEIC: Vermont Energy Investment Corporation

Peter Adamczyk is new to VEIC, Vermont Energy Investment Corporation, but seems to fit right in as Energy Finance & Development Manager. We’d been in touch about Vermont’s PACE legislation and I’d quickly found a font of information. He must also be a breath of fresh air around the legislature, promoting useful amendments to current PACE legislation. And he reports that the political climate may be right, with a new Governor and a progressive majority in the legislature.

We talk about the legislation and the strategy of a junior lien position. The legislation in place was the result of a huge impasse. Yes, the liens are in first position, but “vaporized” in the event of a default. Useful until you need it, we joked. The next step is to modify the legislation to secure the lien and to suit the FHFA concern. Peter will be presenting his solutions in Palm Desert, eager to meet the national network assembling to strategize there.

Blair Hamilton joins us; what a surprise. He and his wife Beth Sachs founded VEIC back when I lived in Burlington; my friend Digger worked there then. We’ve known Blair for more than 25 years; he and I worked for the City of Toronto years ago in a pioneering climate action charrette. He and his colleagues have built an efficiency machine, they employ 150 people, and are administering statewide programs while driving policy like PACE, aligned with and non-coincident with the “investment” in VEIC’s name.

Blair tells me about VEIC’s new foray into the District of Columbia; we both grin about the notion of the typically quality-of-life Vermonter working on assignment in DC. VEIC is also looking west to Ohio, expanding its reach and impact. I congratulate Blair and thank him for stopping by. Russ and he talk of their boys who went to school together in Burlington, Jake and Ben. Both are in town.

My nephews are six and eight and so special. And, they are growing so fast. What a chance to see them. It’s been three years since they left California. Clearly, they have adapted well from the beaches of Laguna to the freezing cold of Vermont.

This winter has been especially cold, and the sidewalks of Burlington are carved out of massive snow banks. The boys seem unphased by this. They’re skating and now skiing. The family goes out walking after dinner each night, often in bitter temperatures. The next day we go to the YMCA to swim. The 80 degree water feels just right; the kids are fish-like.

The Energy Center at Shelburne Farms

Cereal and we’re off. Russell and the boys and I drive down Route 7 to visit “the energy center” tucked away at Shelburne Farms that he’s been working on. It’s a cutting-edge demonstration project spearheaded by our great friend Laurie Smith who has worked for three years to lower the private farm’s carbon footprint.

Perkins Smith began by tightening the buildings on site, then the company turned to supply-side solutions. After hearing so much about it, and the travails of new systems and mixing trades, I wanted to see it. The Energy Center has attracted a lot of attention and visitors, including Vermont’s Senator Patrick Leahy.

Shelburne Farms was created as a model agricultural estate in 1886 by William Seward and Lila Vanderbilt Webb. In 1972 Shelburne Farms became a membership-supported, nonprofit environmental education center, 1,400-acre working farm, and National Historic Landmark on the shores of Lake Champlain. Visitors enjoy walking trails, a children’s farmyard, inn, restaurant, property tours and special events. Its grass-based dairy has 125 purebred, registered Brown Swiss cows, their milk transformed into award-winning farmhouse cheddar cheese.

Shelburne Farms is magical in the snow and dead of winter. We pause to watch a large horse-drawn sleigh with a dozen bundled passengers pulled by its powerful team. In its day, Shelburne Farms had its own railroad station stop. Today the temperature is in the teens, the farm roads are snow-packed, and the snow squeaks underfoot.

The energy center provides heat and hot water to the two residences, a working greenhouse, with extra heat going to a pool. The goal has been for the solar and wood to provide 80% of the energy. The solar system has 360 Viessmann evacuated tubes. The wood boiler is a Froling gasification unit capable of putting out 170,000 BTUs at 95% efficiency. The “back up” propane boiler is a Viessmann 300,000 BTU, 97% efficient and capable of handling the whole load if necessary.

The greenhouse is an essential part of the farm; it will be used to start the summer’s vegetables in spring to prepare for the short growing season. Massive rolling tables fully utilize the heated space and ease weeding and care. There’s a mushroom closet room; and a load-in area for fire wood that comes from nearby woodlot. There’s a super-insulated garage door near the boiler. There are two 500 gallon thermal energy storage tanks in the basement; a spaghetti map of system controls is pasted to the wall. The district heating pipes remind me of Iceland.

Heat is provided in a loading order of supply, beginning with solar, then highly efficient wood gasification and combustion, and then super-efficient propane. How would Bucky Fulller react to such complexity? I ask Laurie and Laura as we do a quick late afternoon walk with their dogs in snowfall of Queen City Park. A skier passes. Appropriate technology in the cold of Vermont winter spells back-up. Here, where the cold is brutal and heat is essential, carbon-saturated sources are judiciously applied.

JFK and Out

I say my thanks and goodbyes the night before; up super early the next morning to catch a mid-day JFK flight to Burbank. Crazy schedule.

The wee hours of the morning are cold and quiet. Single digits and the cat finds my departure a most fortuitous opportunity to dart in. I’m gassed up, ready to go, I drive past UVM and remember my early Billings days there, the fire escape sunsets over the Adirondacks.

The road is clear to Montpelier, then Interstate 89 climbs at Barre and I slow down and respect the snow–packed highway. This rental car’s all-purpose tires are like skates in Vermont. Down past Bethel the roadway clears, and I pick up steam. I power south through Massachusetts and Connecticut.

Gas up, drop off, stuff my coat into my suitcase. What a week.