Large Local Jurisdiction Allocations
QECBs are low-interest federal bonds (via subsidy) available for issuance for qualified energy projects for certain energy efficiency, renewable energy, and energy conservation capital projects. Tennessee’s QECB allocation totals $64,676,000. In June and July 2012, as required by Federal law, the State notified Large Local Jurisdictions (LLJs) of the amount of their allocations, which was based on their proportionate populations. The total amount identified for these fifteen cities and counties was approximately $36 million. LLJs choosing not to utilize their initial allocation were asked to reallocate their share to the State. These LLJ reallocations were combined with the State’s original allocation of $28.6 million for a total of $46,542,395. This amount was made available for qualifying projects through the competitive sub-allocation process outlined in this request for proposals. Entities eligible to participate in the program include all local government jurisdictions in Tennessee and public universities. Local governments can issue the bonds on behalf of a private project, with conditions.
LLJs may issue QECBs themselves or may designate another unit of government, either State or local, to issue bonds from their formula allocation, providing the project financed is fully within the jurisdiction of the LLJ. For example, a county may request a State issuer, such as the TLDA, or an Economic Development Corporation as a conduit issuer, to issue a QECB on behalf of the county. The county may also choose to support a city’s project by allowing the city to issue from the county’s allocation, assuming the city’s project falls completely within the county’s jurisdiction.
In these and similar situations, the LLJ (e.g. the county in the above examples) will be responsible for providing OEP and TLDA with documentation of how they intend to use their formula allocation or allow another issuer within their jurisdiction to use it. Please note that there is no statutory deadline for LLJs to issue QECB at this date; however, Congressional action may be taken to enact such a deadline.
The remainder of the state's total QECB capacity ($28,677,928) is retained by the State. If an LLJ is not able to or chooses not to use its formula allocation, or does not offer it to another issuer within its jurisdiction, its authority may be reallocated to the State for use in the State QECB program. Such authority may then be sub-allocated by OEP and TLDA. The State QECB sub-allocation program is currently under development.
In order to communicate the intent to use formula allocations, OEP requests that LLJs have an official sign the Notice of Intent form and submit it to OEPprior to June 30, 2013. If an LLJ is using the form to reallocate the formula allocation to the State, a letter from the executive or a resolution of the governing body must accompany the Notice of Intent form. The purpose of the Notice of Intent form is to allow OEP and TLDA to determine what amount of the formula allocations will be used by LLJs and what amounts will revert back to the State for use in the State’s QECB program.
In addition, if an LLJ intends to issue QECB from its formula allocation, OEP requests that the LLJ submit a Project Information form at least two weeks priorto QECB issuance. The primary purpose of the Project Information form is to ensure that the 70/30 public-private use limitation requirement is being followed. It will also be used by OEP and TLDA to record the types of projects selected at the local level.