Favorable Agreements Validate and Formalize Numerous Consumer Protection Measures Company Has Already Proactively Implemented, Setting the Framework for Industry Standards for PACE
SAN DIEGO, Aug 9 – Renovate America, the nation’s largest provider of Property Assessed Clean Energy (PACE) financing, today announced it has reached an agreement with six district attorneys and one city attorney representing themselves and the entire State of California to resolve a review initiated in 2015 regarding administration of the company’s proprietary Home Energy Renovation Opportunity (HERO) program. This agreement is the culmination of a 30-month cooperative effort by the State and Renovate America to address prior concerns primarily focused on business practices and disclosures in place around 2016 and previously. These concerns were common to this new innovation in financing for energy and water efficient home improvements. The agreement establishes a “gold standard” for the PACE industry.
The agreement formalizes and further enhances numerous disclosure and consumer protection measures that Renovate America pioneered and implemented over the past several years. As part of this cooperative agreement, there was no finding or acknowledgement of wrongdoing by Renovate America.
Additionally, Renovate America announced it has reached a resolution of a class action focused on disclosure policies and practices that predate the filing of this action in 2015.
Over the past four years, Renovate America has proactively implemented a number of significant improvements in its policies and practices. These have been undertaken to further strengthen its transparency, responsive customer service and consumer protections in offering homeowners broad access to energy and water-efficient home improvements. The agreements take many of Renovate America’s industry-leading disclosure and consumer protection enhancements and uses them as a framework for best practices and operations for the entire PACE industry. In addition, Renovate America voluntarily paid approximately $21.3 million over the last several years to assist homeowners with home transferability and other issues. These payments were acknowledged in the agreement with the State.
Renovate America has set the bar in PACE financing and homeowner satisfaction by prioritizing the creation of structured consumer safeguards and by continuously improving disclosures to homeowners over the years. For instance, since the start of the HERO program, the company has included disclosures that explain the nature of a PACE assessment and the impact on the homeowner. Beginning in 2015, Renovate America started requiring consumers to confirm their understanding of certain key disclosures by initialing each one. Additionally, in 2016 Renovate America became the first PACE administrator to conduct confirmation of terms telephone calls with homeowners in all of its PACE transactions. The company is also responsible for creating the PACE Consumer Protection Policy, which was subsequently adopted by an industry association as the nationwide framework for PACE compliance and regulation. The results of a study by internationally-recognized accounting and advisory firm Baker Tilly focusing on the company’s operations during the 2015-2016 period found that Renovate America was in compliance with the policies and consumer protection guidelines in over 99 percent of its more than 5,200 compliance reviews of engagements with homeowners in various California counties.
“We are pleased to have resolved these matters and take the steps outlined in the resolutions very seriously. We are happy with the outcome of today’s announcement, as it solidifies the substantial reforms that we have adopted in recent years and that directly align with our proven commitment to providing the most customer-centric program to homeowners throughout the state,” said Shawn Stone, chief executive officer of Renovate America. “We would like to thank the legal community for working cooperatively with us to reach these resolutions. We welcome any opportunity to closely collaborate with our public and private sector partners to further define the business practices and policies of our continuously evolving industry. Behind the strength of our leadership position and unwavering focus on innovation, we look forward to further embracing the central responsibility of helping set the standard for the growing home improvement financing industry.”
Since founding its HERO program in 2011, Renovate America has been empowering California homeowners to make energy and water efficiency and resiliency improvements to their homes. Regarded as the gold standard for the industry, Renovate America’s innovative HERO program has provided PACE financing to nearly 122,000 homes across 448 California cities and counties, accounting for approximately $3 billion in home improvements and upgrades. As a result of this home improvement activity, the HERO program enabled the equivalent of more than 28,000 local jobs and had a $4.8 billion economic impact.
As part of the PACE Consumer Protection Policy, Renovate America has continued to refine key areas of its HERO program, including establishing financing pricing review processes and parameters for homeowners; adhering to specific financing terms confirmation calls with homeowners; and enforcing strict protection guidelines for elderly homeowners.
“As the PACE industry continues to change to meet emerging market and regulatory conditions, establishing clear quality and compliance measures for our partners and all those involved is paramount,” added Stone. “We are constantly aiming to progress as a company and an industry. However, the overall value proposition associated with PACE financing has not changed. As homeowners continue to see the benefits of PACE, we are committed to setting the standard when it comes to educating and protecting homeowners as they leverage this unique solution to achieving energy efficiency at home.”
Behind the growth potential and extensive opportunities within the PACE market, Renovate America is now well-positioned to expand its offerings and footprint, as well as further strengthen its transparent, customer-centric approach with the implementation of the requirements of today’s agreements that pertain to bolstering its marketing, financial disclosures and contractor policies.
For more information about Renovate America and its HERO program, please visit www.renovateamerica.com.
About Renovate America
Renovate America offers tech-enabled financing platform for home improvement that empowers communities to modernize and make their homes more efficient, while giving small businesses the tools they need to grow. In addition to financing home improvements through its traditional credit product, Benji, Renovate America offers communities HERO financing. HERO is the leading residential Property Assessed Clean Energy (PACE) program in the U.S. and has been used in thousands of homes to make energy and efficiency improvements. It is estimated that HERO has helped homeowners save billions in energy and water bills and has created over 28,000 local trade jobs. Renovate America has built the world’s largest green bond platform, attracting international investments to meet the U.S. clean-energy objectives.