PACE Halted By City Council

About one year ago, the Gulfport City Council passed a that applies only to commercial businesses. Property Assessed Clean Energy (PACE) offers loans to business owners specifically for upgrades and retrofits that improve the property value and cut energy costs.

City Council Meeting

During Tuesday night's meeting, City Council Member Sam Henderson made a motion to vote on the bid and contract submitted by District Management Services to become the third party administrator for Gulfport's PACE program.

Previously, council members agreed that a third party administrator would be needed to supply the loans and run the program. In May the City Manager put out request for proposals and DMS has since responded and submitted a contract. Ygrene Energy Fund (EcoAssets Solutions) also submitted a bid but notified the city in November that it was "declining the opportunity to deliver a contract for consideration."

Council Member Sam Henderson's motion Tuesday night "died" for lack of a second motion when the room fell silent.

"I was surprised," Council Member Sam Henderson said following the meeting.

Gulfport Patch asked if PACE has a future in Gulfport. Henderson answered, "I would say not under this current council."

Henderson expressed concern over the unanimous reaction from his fellow council members. He said councilors "are obligated to follow The Sunshine Law"

"I think it's a real shame that three council members, two of which are business owners in Gulfport shoot down another oppertunity for other business owners in the city," Henderson said.

Vice Mayor David Hastings also told Gulfport Patch that he was "surprised" by the lack of a second motion. Hastings has been openly opposed to PACE and was prepared to argue his points Tuesday night. Hastings says the contract presented by District Management Services is all "flashing lights." He said "PACE is about other people making money," citing that the agreement lists five organizations that would be involved in the program.

The "Hypothetical Energy Savings Financing" information in the packet did not add up, Hastings said, adding that there are a lot of fees that could be tacked on, pointing out the phrase "this does not include any potential annual, long term maintenance costs"on one page of the contract.

Council Member Jennifer Salmon says she wants to see clean energy move forward. "I want PACE," Salmon said. "I do believe in clean energy. What's most important to me is a return on investment."

Salmon did not elaborate on her concerns about the agreement presented by DMS.

Update: Council Member Barbara Banno contacted Gulfport Patch on Wednesday to share her thoughts on the issue.

"I am 100% behind the redevelopment of 49th St. I was ready to move forward with PACE a few months ago, when the City Manager and Staff completed the RFP process and recommended YGrene. After that did not happen I agreed to review 2 contracts from a 3rd party administrator not 1. I was not comfortable making the 2nd motion last night, because I was not 100% confident with the contract that was brought forward.

As a Council Member, I feel I have an obligation to the citizens and local business owners in Gulfport to look out for what is in our best interest. Because not one business owner showed up in support, I felt it would be presumptious on my part to move forward with such an important contract with no support.'' 

Gulfport Residents

During public comments, Al Davis spoke against PACE and against the agreement submitted by DMS.

"We as a city require two bidders, in all the field of people who might be available for this, we now have one," Davis said. "I remember a lot of promises being made. I think PACE at this stage of the game has too many unanswered questions.

"I have grave concerns over the principals of this organization and I would hope in the process of consideration of involving yourself in a financial relationship that the city would do a formal background check of issues of past behavior," he continued.

"I would caution you to follow the money because this has all the odor of a scam," Davis said.

Doug Hudson also addressed the council.

"I'd like to see the city be cautious in entering into this agreement. I'd like to see us slow down," Hudson said. "The residents depend on the city to look out for the best interest. This is a program that's gonna be sold to the residents as being approved and autorized by the city. I just want to make sure you know exactly what we're getting into."

Margarete Tober also shared her concerns.

"I would, if nothing else tonight, like to understand the relationship between Farios Marketing and DMS. I have great concerns about the Farios involvement. I'm not so concerned about DMS."

Jeri Reed spoke up in support of moving forward with PACE and moving forward with DMS serving as a third party administrator.

"I think you've done a lot of homework. This is strictly for commercial, this is not for the residents at this point because you did your homework. And that's why you voted to go with commercial only because there are unanswered questions with residential. We did have two bidders, and as I understand it, one of them pulled out.

Depending on how far back, I'm sure almost everybody in this room has something that they wished they had never done, so, So49 backs this. We all get to make our own choices on what we do, if we get involved or not."

District Management Services

"We still believe it would be a great program. It's taylor made for Gulfport," Peter Altman, Regional District Manager of DMS, said.

DMS CEO Brian Lamb believes the program would benefit commercial owners. He says they will move forward despite tonight's outcome.

"It's a matter of recognizing the concerns," Lamb said.

Lamb says DMS will work with the Gulfport City Manager to see how they can improve the contract and possibly bring it back to council for future consideration.

Farias Marketing Group

"People did a real injustice tonight," Farias said.

Marketing consultant Mario Farias was extremely dissappointed by the council's decision and said he felt personally attacked by Gulfport residents.

"The past is the past. I've worked with various organizations over the years," Farias said. "They are very cold in a cruel way to someone who's trying to do the right thing."

Farias said he will continue to work with So49 to improve and bring new businesses to Gulfport.

"This is just a setback," he said.

The Farias Marketing Group was included in the agreement for the marketing and outreach elements of the Energy Savings Program.