5. a. Within 270 days after the effective date of P.L.2021, c.201 (C. 34:1B-374 et al.), the authority shall establish the Garden State C-PACE program by publishing on its Internet website:

(1) uniform assessment documents;

(2) a model opt-in ordinance;

(3) Garden State C-PACE program guidelines adopted pursuant to subsection c. of this section; and

(4) a description of the process by which a county or an authorized municipality applies to the authority for approval of a local C-PACE program ordinance.

The Garden State C-PACE program shall not be operational and available for the participation of capital providers, municipalities and property owners until the authority has taken all of the actions required by this subsection.

b. The model opt-in ordinance, as well as any local C-PACE program ordinance, shall prescribe a subset of the criteria for qualifying a C-PACE project for a C-PACE assessment, including the following:

(1) financing recipients shall be the legal or beneficial owners of the property or duly authorized by the legal or beneficial owners of the property, there shall be no defaults on any mortgage loans on the subject property, all tax payments, charges, and assessments with respect to the property shall be current, the legal or beneficial owners of the property shall not be subject to any bankruptcy proceeding, and the subject property shall not be the subject of a bankruptcy proceeding;

(2) the principal amount of the C-PACE assessment, when combined with mortgage and other lien obligations on a property shall not exceed 90 percent of the appraised value of the property after including the value created by the C-PACE project;

(3) the maximum duration of a C-PACE assessment, which shall be determined pursuant to the provisions of paragraph (6) of subsection c. of this section, shall not exceed the weighted average useful life of the improvements in the C-PACE project or 30 years, whichever is less;

(4) the amount of the C-PACE assessment for a property shall be a specific amount, and the terms of repayment of direct financing shall be solely determined and negotiated between a property owner and capital provider subject to the maximum duration of an assessment in paragraph (3) of this subsection; and

(5) a property owner seeking a C-PACE assessment shall receive written consent of the existing mortgage holders on the property prior to the closing of the financing.

c. Pursuant to the purposes and objectives outlined in P.L.2021, c.201 (C. 34:1B-374 et al.), and with respect to the responsibilities of overseeing and implementing the Garden State C-PACE program, the authority shall develop, in consultation with the Division of Local Government Services in the Department of Community Affairs, program guidelines governing the terms and conditions under which financing may be made available under the Garden State C-PACE program. Any amendments to the Garden State C-PACE program guidelines shall require the approval of the authority’s board of directors.

Pursuant to the purposes and objectives outlined in P.L.2021, c.201 (C. 34:1B-374 et al.), and with respect to the responsibilities of overseeing and implementing a local C-PACE program, a county or authorized municipality shall develop program guidelines governing the terms and conditions under which financing may be made available under the local C-PACE program. The program guidelines, and any amendments thereto, for a local C-PACE program shall be consistent with the Garden State C-PACE program guidelines and the requirements set forth in P.L.2021, c.201 (C. 34:1B-374 et al.) for C-PACE projects and financing, and shall be subject to approval by the authority pursuant to subsection a. of section 7 of P.L.2021, c.201 (C. 34:1B-380).

The Garden State C-PACE program guidelines and any local C-PACE program guidelines shall include, but not be limited, to:

(1) a uniform project application, uniform application requirements, including uniform application documents; and the procedures for a property owner to obtain approval of a C-PACE project and a capital provider to finance a C-PACE project;

(2) minimum standards for a C-PACE project to qualify for C-PACE financing;

(3) eligibility criteria for a property owner and property to qualify for a C-PACE assessment;

(4) the underwriting criteria to be applied in determining the eligibility of properties and their owners to participate in the Garden State C-PACE program and local C-PACE programs and the maximum permitted amount of a financing based on a property’s value and other characteristics;

(5) a requirement that all existing mortgage lien holders on a property be given notice prior to a C-PACE assessment and lien being filed in connection with that property, and that all property owners receive consent of the existing mortgage holders on the property;

(6) a requirement that the term of a financing be no longer than the forecast life of the improvements, which shall be calculated on a blended average basis taking account of the relative values of the fixed assets included in the C-PACE project, except that the authority may establish alternative criteria for establishing the maximum term of a financing for a C-PACE project that consists of new construction;

(7) within 90 days following the launch date with respect to the Garden State C-PACE program guidelines only, supplemental program guidelines for refinancing projects completed prior to the submission of a project application for a C-PACE assessment and for the use of the Garden State C-PACE program in connection with the financing of new construction upon previously unimproved real property.

d. Subject to the written consent of existing mortgage holders, the form of which shall be determined by the authority in its uniform assessment documents adopted pursuant to subsection a. of section 5 of P.L.2021, c.201 (C. 34:1B-378), the C-PACE assessment shall be a single, continuous first lien on the property on and after the date of recordation of the C-PACE assessment agreement. A property with delinquent taxes, charges, or assessments shall not be eligible for a C-PACE assessment. Upon recordation of the C-PACE assessment agreement in the land records of the county in which the property is located, the lien thereof shall be perfected for all purposes in accordance with law, and the lien shall be a continuous first lien upon the real estate described in the assessment, paramount to all prior or subsequent alienations and descents of the real estate or encumbrances thereon, except subsequent taxes, charges, or assessments, without any additional notice, recording, filing, continuation filing, or action, until payment in full of the C-PACE assessment, notwithstanding any mistake in the name or names of any owner or owners, or any omission to name any owner or owners who are unknown, and notwithstanding any lack of form therein, or in any other proceeding which does not impair the substantial rights of the owner or owners or other person or persons having a lien upon or interest in any the real estate. Any confirmation of the amount of the C-PACE assessment by the applicable municipality’s governing body or by a court shall be considered as determining the amount of the existing lien and not as establishing the lien. All C-PACE assessments shall be presumed to have been regularly assessed and confirmed and every assessment or proceeding preliminary thereto shall be presumed to have been regularly made or conducted until the contrary be shown.

e. A C-PACE assessment shall be treated as a municipal lien rather than a contractual lien for all purposes of law.

f. Funds to finance a C-PACE project may be disbursed to, or for the benefit of, the property owner at execution of the C-PACE assessment agreement, or may be disbursed in installments over time. The funds shall not constitute public funds, and shall not be subject to the laws governing public funds, including, but not limited to, laws regarding the receipt, expenditure, deposit, investment, or appropriation of the same. Payments of the C-PACE assessment shall commence as set forth in the C-PACE assessment agreement. To the extent that upon completion of the C-PACE project, funds remain that have not been disbursed to the property owner, those funds on hand shall be used to reduce the amount of the C-PACE assessment in accordance with the C-PACE assessment agreement.

g. Except as provided in this subsection, if any payment of a C-PACE assessment is not made when that payment shall have become due, or later, consistent with any grace period provided or extended by a participating municipality for the payment of property tax bills as may be permitted or required by law, interest thereon shall be imposed at the same rate as may be imposed upon unpaid property taxes in the participating municipality. Notwithstanding any other provision of law, such statutory interest shall be in addition to any accrued interest and any amount fixed as a penalty for delinquency pursuant to the financing agreement between the property owner and the capital provider. All such amounts shall be collected and enforced in the same manner as unpaid property taxes, including by accelerated tax sale if the participating municipality enforces collection of its unpaid property taxes through accelerated tax sales. The proceeds of the sale shall also pay the outstanding past unpaid amounts of the C-PACE assessment. However, the remaining balance not delinquent on a C-PACE assessment shall not be subject to acceleration or extinguishment in the event of a default in payment. Any statutory interest collected by the municipality on a delinquent C-PACE assessment pursuant to this subsection shall be retained by the municipality. Any accrued interest, or any amount fixed as a penalty for delinquency, pursuant to the financing agreement between the property owner and the capital provider shall be remitted to the capital provider. If the property owner is delinquent on a C-PACE assessment as well as delinquent on taxes, charges, or other assessments, any payment shall be applied towards any and all such other delinquencies before being applied to any delinquent C-PACE assessment. Notwithstanding any other provision of law, in the event that any lien on the property shall be exposed to tax sale, pursuant to the “tax sale law,” R.S.54:5-1 et seq., and is struck off and sold to the participating municipality, the C-PACE assessment shall survive any subsequent action to foreclose the right of redemption and continue as a first lien upon the real estate described in the assessment, paramount to all prior or subsequent alienations and descents of the real estate or encumbrances, except subsequent taxes, charges, or other assessments, and provided that, notwithstanding the obligations of a participating municipality pursuant to section 1 of P.L.1942, c.54 (C.54:5- 53.1), while the participating municipality holds the lien or owns the property, the participating municipality shall not be responsible for or required to make any payment from its treasury or any other source in furtherance of or to satisfy the C-PACE assessment. A municipality shall not bear any other responsibility in furtherance or satisfaction of a C-PACE assessment, except that a municipality may be compelled to enforce a lien through an action to foreclose. In the event of a taking of the property by eminent domain or condemnation, the C-PACE assessment may be accelerated or extinguished, at the election of the capital provider, provided the capital provider is compensated in accordance with the provisions of the “Eminent Domain Act of 1971,” P.L.1971, c.361 (C. 20:3-1 et seq.), by the governmental entity utilizing eminent domain or condemnation for the balance due on the unpaid C-PACE assessment and any interest, penalties, or other charges related thereto.

h. (1) C-PACE assessments shall be assigned directly by the participating municipality, and any assignee thereof, as security for financing from a capital provider to finance C-PACE projects. Notwithstanding any law to the contrary, the assignment shall be an absolute assignment of all of the participating municipality’s right, title, and interest in and to the C-PACE assessment, except for its obligations to bill, collect, remit, and enforce C-PACE assessments as set forth in the assignment agreement. The proceeds of a C-PACE assessment shall be considered “special revenues” owned by the capital provider pursuant to chapter 9 of the federal bankruptcy code.

(2) C-PACE assessments assigned as provided hereunder shall not be included in the general funds of the participating municipality, or be subject to any laws regarding the receipt, deposit, investment, or appropriation of public funds, and shall retain such status notwithstanding enforcement of the assessment by the participating municipality or assignee as provided herein. In the case of a participating municipality that is otherwise subject to tax or revenue sharing pursuant to law and which assigns C-PACE assessments as set forth in this section, the C-PACE assessments shall not be considered part of the tax or revenue sharing formula or calculation of municipal revenues for the purpose of determining whether that participating municipality is obligated to make payment to, or receive a credit from, any tax sharing or revenue sharing pool. However, the redemption of any delinquent and unpaid C-PACE assessments, including any interest, penalties, or other charges related thereto, shall be paid no later than on the first available tax bill after the property has been sold after an action to foreclose the right of redemption.

i. The provisions of the “Administrative Procedure Act,” P.L.1968, c.410 (C. 52:14B-1 et seq.), shall not apply to the preparation, publication, or implementation of the uniform assessment documents or the program guidelines of the Garden State C-PACE program or a local C-PACE program.

L.2021, c.201, s.5.