August 5th Information &
Resources Update
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Clean Peak Energy Standard Launched
The Baker-Polito Administration has announced the launch of a first-in-the-nation Clean Peak Energy Standard (CPS), a financial incentive program that promotes the use of clean energy technologies to supply power when electricity demand is at its highest, also known as peak demand. Through the CPS, the use of clean energy during seasonal peak periods is intended to reduce greenhouse gas emissions, lower electricity costs, and facilitate the growth of renewable energy in the state.
The CPS program is designed based on the framework of existing Massachusetts clean energy policies, such as the Renewable Portfolio Standard (RPS), and utilizes a familiar structure to the clean energy market in Massachusetts. The CPS creates a requirement for all electricity suppliers to purchase a certain amount of Clean Peak Energy Certificates (CPECs) each year based on a specified percentage of the amount of electricity that they supply.
Eligible clean energy resources that generate, dispatch, or discharge energy during specified times of the day during each season of the year will generate CPECs. The CPEC market will create revenue for resources, like energy storage, that can shift energy usage from the seasonal peak periods or the time periods during a season when the net demand for electricity is typically highest.
The Clean Peak Energy Standard was part of An Act to Advance Clean Energy and signed into law in August 2018. This announcement follows more than a year of public engagement with industry stakeholders, the joint Telecommunications, Utilities, and Energy (TUE) Committee, and other advocates on the design and implementation of the program.
The Clean Peak Energy Standard application portal, managed by the Massachusetts Clean Energy Center (MassCEC), is scheduled to go live on August 17, 2020. MassCEC and DOER will host an online stakeholder informational session on August 10, 2020; click here to register for the informational session.
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Main Street Lending Program Expanded to Serve Nonprofits
From Peter Martin of Bowditch & Dewey LLP:
The Main Street Lending Program (MSLP) was established by the Treasury Department with $75 billion from the CARES Act to enhance access to credit for small and medium-sized businesses during the COVID-19 pandemic which were in sound financial condition prior to the pandemic. On June 15, 2020, the Federal Reserve proposed to expand the MSLP to small and medium-sized nonprofits and released draft guidelines and eligibility requirements. On July 17, the Federal Reserve revised those guidelines and requirements to make two MSLP loan programs more available to a wider range of nonprofits.
The two loan programs are for new loans taken out by nonprofits after June 15, 2020 (the Nonprofit Organization New Loan Facility), and for expanded borrowing by nonprofits under a prior loan made before June 15, 2020 that has a remaining maturity of at least 18 months (the Nonprofit Organization Expanded Loan Facility). Minimum loan size for the NONLF is $250,000 and $10 million for the NOELF. The maximum NONLF loan is the lesser of $35 million or the organization’s average 2019 quarterly revenue; the maximum NOELF loan size is the lesser of $300 million or the organization’s average 2019 quarterly revenue. Both programs permit the Federal Reserve Bank of Boston to lend money to a special purpose vehicle which will in turn purchase 95% participations in eligible loans made to nonprofits by eligible lenders. In all cases, loans under the programs are available only to tax-exempt nonprofit organizations under Internal Revenue Code section 501(c)(3) or tax-exempt veterans’ organizations under IRC section 501(c)(19) which have been operating since January 1, 2015.
For all such borrowers, certain loan terms are uniform:
- The loan is for five years
- Principal payments are deferred for the first two years, then principal must be paid in years three through five in the following proportions: 15%, 15% and 70%
- Interest payments are deferred for one year
- Interest is set at LIBOR plus 3%
The most significant revised guidelines and requirements (compared to the June 15 proposal) are as follows:
- The nonprofit’s minimum number of employees is ten (had been 50) but no more than 15,000 employees, and it must have 2019 revenues of no more than $5 billion and an endowment of less than $3 billion
- The nonprofit’s non-donation revenues must be at least 60% of expenses (had been 70% of revenues) from 2017 through 2019
- The nonprofit’s margin must be at least 2% (had been 5%)
- The nonprofit’s current cash on hand must be at least 60 days (had been 90 days)
- The nonprofit’s current debt repayment capacity must be greater than 55% (had been 65%)
Nonprofits that have participated in the Payroll Protection Program are eligible to participate in these loan programs, but the outstanding and unforgiven amount of PPP loans is counted as outstanding debt for purposes of calculating the maximum amount that may be borrowed under these loan programs.
As with any lending facility, the devil is in the details. For example, for purposes of calculating the “non-donation revenues” proportion, a potential nonprofit borrower should know that “donations” include gifts, revenues from fundraising events and grants from donor-advised funds, but exclude government grants, revenues from a supporting organization and multi-year private foundation grants. Likewise, if the nonprofit has other loans from the same lender, those loans must meet certain risk rating standards. Also, the nonprofit must certify that it won’t seek to cancel its lines of credit and that it doesn’t anticipate filing for bankruptcy for at least 90 days. Nonprofits considering either of these loan programs should consult counsel to consider their eligibility and applicable loan requirements prior to reaching out to their banks or other lenders.
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Marlborough Economic Development Corporation Reopens Small Business Grant Relief Program
The Marlborough Economic Development Corporation (MEDC) has reopened its Small Business Grant Relief Program. Existing Marlborough businesses with 25 employees or less who have been impacted by COVID-19 may be eligible to receive up to $5,000 in funds for reopening costs. Applications will be accepted on a first come, first serve basis while funds are available until August 21, 2020.
Eligible uses for the grants include safety and operational retrofits for re-opening, personal protective equipment (PPE), and any other costs related to re-opening under the state’s COVID-19 re-opening guidelines. Grant funds are not intended to be used as a supplement to other federal or state COVID-19 relief programs that a business previously received.
Eligibility Requirements and Guidelines: The program is open to for-profit existing Marlborough businesses that can demonstrate or provide the following:
- Business has been impacted by the COVID-19 pandemic
- 25 employees or less
- Have been in their current Marlborough space and open for business for at least 6 months prior to March 16, 2020
- Costs are related to re-opening under the state’s re-opening guidelines
- Quotes, invoices or receipts showing how the funds will be or were used
- Proof of purchase within 30 days of receiving award
- Business and owner in good standing with the City of Marlborough and the State of Massachusetts by way of providing Certificate of Good Standing
- Documentation verifying the number of employees on payroll (such as IRS payroll tax filings or payroll and unemployment insurance filings)
- Copy of current lease agreement
- Willingness to enter into a Memorandum of Agreement “MOA” with the MEDC (example of MOA attached).
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Asset Management Planning Grant Program Funding Round Now Accepting Applications
The Trust will provide a grant award of $150,000 or 60% of eligible project cost, whichever is less. The eligible entities will provide the remaining amount with both In-Kind Services (IKS) and a capital contribution.
The Trust, in an effort to streamline the process, has prequalified consulting engineering firms that have both the capacity and experience to complete these projects. Eligible entities will be required to utilize one of the firms listed under the Prequalified Engineering Firms indicated in the Program Description and Guidance document. Projects may use Clean Water or Drinking Water SRF loans to finance cash contributions if needed. The number of projects will be subject to the $2 million appropriated by the Massachusetts Clean Water Trust Board of Trustees for this purpose.
Since Asset Management is a process, the proposed project can be small or extensive and can include a variety of beneficial activities that are currently appropriate to meet the utility's planning requirements, including generating plans and/or necessary reports. MassDEP will favor proposals that include a clear description of the applicant’s current asset management status and goals, and those that demonstrate a strong commitment to participate in their AMP.
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Biweekly MetroWest Employer Town Hall Series
Area employers are invited to join the 495/MetroWest Partnership and the MassHire Metro South/West Workforce Board for our continuing discussions, occurring every other week, surrounding critical issues business are facing. We will answer questions about the various resources that are available to companies and their workers during these difficult times.
These discussions are open to any interested party, and are held every other Wednesday at 1:00 PM via Zoom. The next session will be held this afternoon, August 5th; click here to sign up!
Hosts:
- Jason Palitsch, Executive Director, the 495/Metro West Partnership
- Greg Bunn, Executive Director, MassHire Metro South/West Workforce Board
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As always, please do not hesitate to reach out if the Partnership can be of any assistance to you. You may reach me directly via email at [email protected].
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Sincerely,
Jason Palitsch
Executive Director
The 495/MetroWest Partnership
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