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§ 10093.2. Finance or Service Entity Enrollment.

4 CA ADC § 10093.2BARCLAYS OFFICIAL CALIFORNIA CODE OF REGULATIONS

Barclays Official California Code of Regulations Currentness
Title 4. Business Regulations
Division 13. California Alternative Energy and Advanced Transportation Financing Authority
Article 7. Affordable Multifamily Energy Efficiency Financing Program
4 CCR § 10093.2
§ 10093.2. Finance or Service Entity Enrollment.
(a) Descriptions of Finance or Service Entity Applicant and Entity Program Roles
(1) The “Primary Finance or Service Entity Applicant” is the financing company that is applying to the Program for enrollment as a Finance or Service Entity and includes any business organization that is managed, owned, or controlled by the applicant which will perform one or more of the Program roles. The Primary Finance or Service Entity Applicant may fulfill all of the Program roles (described in Section 10093.2(b)(1) - (7)) themselves, or the entity may invite an Affiliate Finance or Service Entity Applicant (as described in Section 10093.2(a)(2)) to apply to fulfill some of the roles. Additionally, the Primary Finance or Service Entity Applicant may invite a Marketing Representative to fulfill the Marketing Representative role described in Section 10093.2(b)(7). If there are two or more entities fulfilling Program roles together, it will be the entity that plans to fulfill the “Agreement Submittal” role that will be the Primary Finance or Service Entity Applicant. The Primary Finance or Service Entity Applicant must meet requirements described in Section 10093.2(c) and must be a signatory to the Program application.
(2) The “Affiliate Finance or Service Entity Applicant” is a potential co-applicant along with the Primary Finance or Service Entity Applicant. It may fulfill one or more of the roles of the Program described in Section 10093.2(b)(1) - (7), except the “Agreement Submittal” role. The Affiliate Finance or Service Entity Applicant must meet the requirements described in Section 10093.2(c) and must be a signatory to the Program application.
(3) “Finance or Service Entity Applicant” means the Primary Finance or Service Entity Applicant and the Affiliate Finance or Service Entity Applicant collectively.
(4) “Primary Finance or Service Entity” means a Primary Finance or Service Entity Applicant who has been accepted for enrollment in the Program. The Primary Finance or Service Entity must fulfill all the Program roles described in Section 10093.2(b)(1) - (7) themselves, or this entity may fulfill Program roles along with an Affiliate Finance or Service Entity and, potentially, an additional entity serving as Marketing Representative. If there are two entities fulfilling Program roles together, it will be the entity that fulfills the Agreement Submittal role that will be determined to be the Primary Finance or Service Entity.
(5) “Affiliate Finance or Service Entity” means an Affiliate Finance or Service Entity Applicant that has been accepted for enrollment in the Program to fulfill Program roles along with the Primary Finance or Service Entity.
(6) “Finance or Service Entity” means the Primary Finance or Service Entity and the Affiliate Finance or Service Entity collectively.
(b) Finance or Service Entity Roles Within the Program
(1) “Underwriting”
(A) Means following Program regulations for approving financing and projects for customers pursuant to Section 10093.4(d) and Section 10093.5 as well as following the credit and underwriting criteria submitted by the Finance or Service Entity Applicant pursuant to Section 10093.2(c)(3) that were approved by the Authority as part of the application process.
(B) The Underwriting role must be performed by either the Primary Finance or Service Entity or the Affiliate Finance or Service Entity.
(2) “Origination”
(A) Means originating and executing the legal contract for repayment of the Enrolled Efficiency Agreement with the Eligible Affordable Multifamily Customer, getting Program forms signed and certified by the Eligible Affordable Multifamily Customer, following Program regulations related to eligible products as well as adhering to product terms approved by the Authority as part of the application process.
(B) The Origination role must be performed by either the Primary Finance or Service Entity or Affiliate Finance or Service Entity.
(3) “Agreement Submittal”
(A) Means providing data, documentation, and certifications related to the Project, the Enrolled Efficiency Agreement, and the Eligible Affordable Multifamily Customer, and submitting these data, documentation, and certifications to the Authority for enrollment in the Program.
(B) The specific documentation and data points required at Agreement Submittal are described in Section 10093.6(b)(1)-(2).
(4) “Servicing”
(A) Means conducting a customer service operation to on-board all Enrolled Efficiency Agreements into the servicer's servicing system, handling customer inquiries regarding Enrolled Efficiency Agreements already under servicing, sending out regular financing billing statements, collecting and applying payments, handling requests for modifications, collections where necessary, and distributions to investors where applicable.
(B) The Servicing role must be performed by either the Primary Finance or Service Entity or the Affiliate Finance or Service Entity.
(5) “Monthly Reporting”
(A) Means supplying the Authority with a regular report of required data related to financing applications, performance, and sale of financings as described in Section 10093.10.
(B) The Monthly Reporting role must be performed by either the Primary Finance or Service Entity or Affiliate Finance or Service Entity.
(6) “Loss Reserve Account Representative”
(A) Means the Finance or Service Entity for whom the Loss Reserve Account(s) will be opened, and the sole entity that can file a claim in the event of a charge-off.
(B) The Loss Reserve Account Representative role must be performed by either the Primary Finance or Service Entity or the Affiliate Finance or Service Entity.
(7) “Marketing Representative”
(A) Means the entity that is publicly listed on Program websites and marketing materials as a result of participation in the Program.
(B) The Marketing Representative role must be performed by either the Primary Finance or Service Entity or the Affiliate Finance or Service Entity, or by an additional entity.
(C) The Marketing Representative must sign the acknowledgements and certifications in Section 10093.2(c)(4), (5), and (7).
(c) Application to Participate in the Program. A Primary Finance or Service Entity Applicant must submit a complete enrollment application to the Authority signed by a person authorized to legally bind the Primary Finance or Service Entity Applicant and shall include the signatory's name, title, and date. Where the Primary Finance or Service Entity Applicant wishes to apply along with an Affiliate Finance or Service Entity Applicant, the Affiliate Finance or Service Entity Applicant must also submit an application signed by a person authorized to legally bind the Affiliate Finance or Service Entity Applicant and provide their name, title, and date. Both the Primary Finance or Service Entity Applicant and the Affiliate Finance or Service Entity Applicant must sign the acknowledgements, certifications, and representations of the Finance or Service Entity Applicant, below. All applications must include a certification that all of the information provided is true and correct to the best of the signatory's knowledge. A complete enrollment application includes the following information, disclosures, acknowledgements, certifications, and representations in a format to be specified by the Authority:
(1) Information
(A) For the Primary Finance or Service Entity Applicant:
(i) Name, address, and website URL of the Primary Finance or Service Entity Applicant.
(ii) Name, title, phone number, and e-mail address of the Program contact person for the Primary Finance or Service Entity Applicant.
(iii) The name(s) and e-mail address(es) of individual(s) who are authorized to provide and certify data and submit Eligible Efficiency Agreements for enrollment in the Program on behalf of the Primary Finance or Service Entity Applicant.
(iv) Type of finance entity, e.g., insured depository institution, insured credit union, Community Development Financial Institution, California Finance Lender, or other type.
(v) Name(s) of any regulatory agency(ies) and any insuring agency(ies) to which the Finance or Service Entity Applicant is accountable and license number(s), if applicable.
(B) For the Affiliate Finance or Service Entity Applicant, if applicable:
(i) Name, address, and website URL of the Affiliate Finance or Service Entity Applicant.
(ii) Name, title, phone number, and e-mail address of the Program contact person for the Affiliate Finance or Service Entity Applicant.
(iii) Type of finance entity, e.g., insured depository institution, insured credit union, Community Development Financial Institution, California Finance Lender, or other type.
(iv) Name(s) of any regulatory agency(ies) and any insuring agency(ies) to which the Finance or Service Entity Applicant is accountable and license number(s), if applicable.
(C) For the Marketing Representative, if different than the Finance or Service Entity Applicant:
(i) Name, address, and website URL of the Marketing Representative.
(ii) Name, title, phone number, and e-mail address of the Program contact person.
(2) Disclosures. The Finance or Service Entity Applicant must disclose the following:
(A) If there are to be separate entities applying to be the Primary Finance or Service Entity and Affiliate Finance or Service Entity, which of the two entities will perform the Underwriting, Origination, Servicing, Monthly Reporting, and Loss Reserve Account Representative roles;
(B) The name of the entity that will be the Marketing Representative;
(C) The name of the entity funding the Projects that are to be enrolled in the Program;
(D) The name of the finance agreement counterparty(ies) or the service agreement counterparty(ies) who will be named on the closing documentation provided to the Eligible Affordable Multifamily Customer;
(E) The assignee(s) of repayment streams, if any; and
(F) The Finance or Service Entity Applicant's intent as to what it will do with the Enrolled Efficiency Agreements, if known, (e.g. hold, sell, transfer, participate, etc.) and the identity of a purchaser, if applicable.
(3) Proposed Products. To participate in the Program, the Finance or Service Entity Applicant must provide a description of proposed financial product(s), including:
(A) A detailed description of the products the Finance or Service Entity Applicant is proposing to offer, including, but not limited to, the type of financing product and its relationship to the categories of Eligible Efficiency Agreements, collateral requirements (if any), minimum and maximum financed amounts, interest rates (including whether they are fixed or variable), terms, service or maintenance charges, fees, prepayment penalties, and a description of customer eligibility and underwriting criteria. These product offerings must be certified by at least one of the Finance or Service Entity Applicants.
(B) A description of the geographic area(s) in California where the financing program(s) will be available.
(C) An explanation of how the Loss Reserve Contribution will be utilized to provide benefits to Eligible Affordable Multifamily Customers compared to the Finance or Service Entity Applicant's typical product offerings in one or more of the following ways:
(i) Broadened approval criteria;
(ii) Longer terms;
(iii) Larger amounts available to finance;
(iv) Better rates; and/or
(v) Other advantageous terms.
(4) Acknowledgements of the Finance or Service Entity Applicant and the Marketing Representative. The application must include the Finance or Service Entity Applicant's acknowledgements contained within this Subsection, signed by a person authorized to legally bind the Finance or Service Entity Applicant. If the Finance or Service Entity Applicant will not be filling the Marketing Representative role, the application must additionally include the Marketing Representative's acknowledgements below, signed by a person authorized to legally bind the Marketing Representative.
(A) The Authority has made no representations, promises, or guarantees pertaining to the volume, quantity, or quality of financing or service agreements issued under the Program.
(B) It, its representatives, and agents are not hired by the Authority or any of the participating IOUs, and must not represent themselves as such, or claim association or affiliation with the Authority or any of the participating IOUs in any capacity.
(5) Certifications of the Finance or Service Entity Applicant and Marketing Representative. The application must include the Finance or Service Entity Applicant's certifications of this Subsection signed by a person authorized to legally bind the Finance or Service Entity Applicant. The Finance or Service Entity Applicant certifies that once it is enrolled in the Program as a Finance or Service Entity it will follow Section 10093.2(c)(5)(A)-(G) below. If the Finance or Service Entity Applicant will not be filling the Marketing Representative role, the application must additionally include the Marketing Representative's certifications of this Subsection, except for Section 10093.2(c)(5)(D), signed by a person authorized to legally bind the Marketing Representative.
(A) It is not subject to a cease and desist order or other regulatory sanction from the appropriate federal or state regulatory body, which would impair its ability to participate in the Program.
(B) The person signing the application is authorized to legally bind the Finance or Service Entity Applicant, and must include the signatory's printed name, title, and date.
(C) All Finance or Service Entity Applicants, that are not Financial Institutions must comply with the additional requirements specified in Section 10093.3.
(D) The regulations within this Article constitute a lender services agreement between the Finance or Service Entity and the Authority.
(E) It must follow the Program regulations as set forth herein.
(F) It must permit an audit by the Authority of any of its records relating to Enrolled Efficiency Agreements during normal business hours on its premises, and must supply such other information concerning Enrolled Efficiency Agreements as may be requested by the Authority. Additionally, the Finance or Service Entity must permit an audit of its records relating to how it is representing the Program to the public, including, but not limited to, web and print collateral, marketing scripts, and marketing materials.
(G) The Authority and the State of California have no liability to the Finance or Service Entity under the Program except for funds deposited in the Loss Reserve Account(s) for the Finance or Service Entity.
(6) In addition to the certifications listed in Section 10093.2(c)(5), the application must include the following certifications of the Primary Finance or Service Entity Applicant. These certifications must be signed by a person authorized to legally bind the Finance or Service Entity Applicant, that upon enrollment in the Program as a Finance or Service Entity and for all forthcoming Eligible Efficiency Agreements submitted for enrollment in the Program, the Finance or Service Entity Applicant agrees that:
(A) It will provide the documentation required in Section 10093.6(b)(1), the data required in Section 10093.6(b)(2), and will secure the certifications described in Section 10093.6(b)(3);
(B) The Eligible Affordable Multifamily Customer will be provided with a Bill Impact Estimate;
(C) The Eligible Efficiency Agreement will comply with all Program regulations;
(D) The Claim-Eligible Financed Amount will not include any costs for Distributed Generation;
(E) It will submit copies of approved permits by the relevant permitting agency required to complete each Scope of Work;
(F) If the entirety of the Claim-Eligible Financed Amount has not yet been funded at the time of submittal, that it will be funded within 30 calendar days of submittal; and
(G) If after submittal, the Primary Finance or Service Entity determines it will not fund the entirety of the Claim-Eligible Financed Amount, that it will notify the Authority within 10 business days of this determination.
(7) Representations of the Finance or Service Entity Applicant and Marketing Representative.
The application must include the Finance or Service Entity Applicant's representation, warranty, and covenant contained in this Subsection, signed by a person authorized to legally bind the Finance or Service Entity Applicant. If the Finance or Service Entity Applicant will not be filling the Marketing Representative role, the application must additionally include the Marketing Representative's representation, warranty, and covenant below, signed by a person authorized to legally bind the Marketing Representative. Upon enrollment in the Program:
(A) It must retain all records relating to each Enrolled Efficiency Agreement for the term of financing.
(B) It is solely responsible for identifying and making all disclosures and providing periodic reports to its Eligible Affordable Multifamily Customer(s) as required under applicable finance laws.
(C) It must comply with all applicable finance laws, possess and maintain all required state and federal licenses, and remain in good standing with all governmental authorities having jurisdiction over its business.
(D) It indemnifies, defends, and holds harmless the Authority, each of the IOUs, their affiliates, and each of its respective officers, directors, employees, agents, and representatives (each of which is an express beneficiary of this indemnity) from and against any and all losses arising in connection with any claim:
(i) Resulting from the negligent or unlawful acts or omissions, or willful or tortious conduct including, but not limited to, any failure of the Finance or Service Entity, or its agents, to comply with applicable finance laws in connection with Enrolled Efficiency Agreements;
(ii) Resulting from any error or omission by the Finance or Service Entity or any of its agents in the calculation or presentation of principal repayments or interest with respect to an Enrolled Efficiency Agreement, fees and charges, the receipt and processing of payments received from Eligible Affordable Multifamily Customers or any collection or enforcement action;
(iii) Alleging any breach of a representation, warranty, or covenant by such Finance or Service Entity;
(iv) Alleging any misrepresentation by the Finance or Service Entity or its agents with respect to the energy savings to be achieved in connection with an Enrolled Efficiency Agreement, or any failure or deficiency in the products, materials, or work supplied to an Eligible Affordable Multifamily Customer in connection with an Enrolled Efficiency Agreement; and/or
(v) Arising from the Finance or Service Entity's breach or alleged breach of the regulations within this Article and/or its confidentiality or privacy obligations under the regulations within this Article or with respect to the Program.
(E) The Finance or Service Entity agrees that the IOUs are not responsible for, and will have no liability for:
(i) The energy efficiency improvements funded through the Enrolled Efficiency Agreement(s) supported through the Loss Reserve Account(s);
(ii) The assessment of potential benefits and costs associated with those improvements;
(iii) The qualification of the Finance or Service Entity;
(iv) The Finance or Service Entity's marketing and/or lending policies and practices; or
(v) The Authority's educational and outreach activities.
(d) Application Process
(1) Upon receipt of a completed application, the Authority will, within fifteen business days, review and determine whether additional information is required, or whether the application is sufficient to permit the Finance or Service Entity Applicant to be a Finance or Service Entity.
(2) The Authority's decision regarding enrollment will be final.
(3) The Authority will notify the Finance or Service Entity Applicant of its decision and provide a Program Identifier if enrolled as a Finance or Service Entity.
(e) Changes to Product Terms
(1) If, after being approved to participate in the Program, a Finance or Service Entity wishes to make changes to products offered that will affect the benefits to Eligible Affordable Multifamily Customers (as described in Section 10093.2(c)(3)), the changes must be approved by the Authority.
(f) Finance or Service Entity Withdrawal and Termination
(1) A Finance or Service Entity may withdraw from the Program after giving written notice, signed by a person authorized to legally bind the Finance or Service Entity to the Authority. Such notice must specify either:
(A) That the Finance or Service Entity waives any further interest in the Loss Reserve Account(s) and the reason for the Finance or Service Entity's withdrawal from the Program (including that all Enrolled Efficiency Agreements covered by the Loss Reserve Account(s) have been repaid or sold to a different Finance or Service Entity's portfolio); or,
(B) That the Finance or Service Entity will not enroll any further Eligible Efficiency Agreements under the Program but that the Loss Reserve Account(s) will continue in existence to secure all Enrolled Efficiency Agreements that were enrolled prior to such notice, and the reason for the Finance or Service Entity's withdrawal from the Program.
(2) For any such notice received pursuant to Section 10093.2(f)(1)(A), the remaining balance in the Finance or Service Entity's Loss Reserve Account(s) will be distributed to the appropriate Program Holding Account(s).
(3) The Executive Director may terminate participation of a Finance or Service Entity in the Program, by notice in writing, upon the occurrence of any of the following:
(A) Entry of a cease and desist order, regulatory sanction, or any other action against the Finance or Service Entity by a regulatory agency or court with jurisdiction over the Finance or Service Entity;
(B) Failure of the Finance or Service Entity to abide by applicable finance law or the regulations within this Article;
(C) Failure of the Finance or Service Entity to service or enroll any Eligible Efficiency Agreements under the Program, as applicable, for a period of one year;
(D) Failure of the Finance or Service Entity to report to the Authority pursuant to Section 10093.10 for sixty calendar days; or
(E) Providing false or misleading information regarding the Finance or Service Entity, or an Enrolled Efficiency Agreement, to the Authority, or failure to provide the Authority with notice of material changes in submitted information regarding the Finance or Service Entity.
(4) In the event of such termination, the Finance or Service Entity must not enroll any further Eligible Efficiency Agreements, but all previously Enrolled Efficiency Agreements will continue to be covered by the Loss Reserve Account(s) until the entity is paid, claims are filed, or the Finance or Service Entity withdraws from the Program pursuant to Section 10093.2(f)(1)(A).
(5) A terminated Finance or Service Entity must continue to report on Enrolled Efficiency Agreements pursuant to Section 10093.10.
(6) If a terminated Finance or Service Entity fails to report to the Authority pursuant to Section 10093.10 for sixty calendar days, the remaining balance in the Finance or Service Entity's Loss Reserve Account(s) may be distributed to the appropriate Program Holding Account(s).
Note: Authority cited: Sections 26006 and 26009, Public Resources Code. Reference: Sections 26002, 26002.5, 26003, 26006, 26011 and 26040, Public Resources Code.
HISTORY
1. New section filed 5-9-2019 as a deemed emergency pursuant to Public Resources Code section 26009; operative 5-9-2019 (Register 2019, No. 19). A Certificate of Compliance must be transmitted to OAL by 11-5-2019 or emergency language will be repealed by operation of law on the following day.
2. New section refiled 10-31-2019 as a deemed emergency pursuant to Public Resources Code section 26009; operative 11-6-2019 pursuant to Government Code section 11346.1(d) (Register 2019, No. 44). A Certificate of Compliance must be transmitted to OAL by 2-4-2020 or emergency language will be repealed by operation of law on the following day.
3. New section refiled 1-30-2020 as a deemed emergency pursuant to Public Resources Code section 26009; operative 2-5-2020 pursuant to Government Code section 11346.1(d) (Register 2020, No. 5). A Certificate of Compliance must be transmitted to OAL by 5-5-2020 or emergency language will be repealed by operation of law on the following day.
4. Certificate of Compliance as to 1-30-2020 order, including amendment of section heading and section, transmitted to OAL 5-5-2020 and filed 6-17-2020; amendments operative 6-17-2020 pursuant to Government Code section 11343.4(b)(3) (Register 2020, No. 25).
This database is current through 9/11/20 Register 2020, No. 37
4 CCR § 10093.2, 4 CA ADC § 10093.2
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