CPACE Property Evaluation 3 — Questions and Answers
Question 1: Which property characteristic can disqualify a building from CPACE eligibility even if it meets all other criteria?
- Being located in a commercial zone
- Having a delinquent property tax account (Correct answer)
- Being owner-occupied
- Having a LEED Silver certification
Correct answer: Having a delinquent property tax account
Most CPACE programs require property taxes to be current; a delinquent tax account signals financial distress and creates priority lien complications.
Question 2: When evaluating a hotel property for CPACE, which building system typically offers the largest energy savings potential?
- Elevator modernization
- HVAC and building envelope improvements (Correct answer)
- Parking lot lighting only
- Kitchen ventilation hoods
Correct answer: HVAC and building envelope improvements
HVAC systems and building envelope (insulation, windows, roofing) typically account for the largest share of a hotel's energy consumption and savings potential.
Question 3: What does a 'Measurement & Verification' (M&V) plan add to a CPACE property evaluation?
- It replaces the need for a preliminary energy audit
- It establishes the methodology for confirming actual post-installation savings (Correct answer)
- It sets the property's assessed value for tax purposes
- It guarantees the contractor's installation quality
Correct answer: It establishes the methodology for confirming actual post-installation savings
An M&V plan defines how actual energy savings will be measured and verified after project completion, providing accountability for projected savings claims.
Question 4: A CPACE program evaluator reviews a 1960s office building with no prior energy upgrades. What term describes the additional energy reductions attributable solely to the CPACE-funded improvements?
- Gross savings
- Net incremental savings (Correct answer)
- Avoided cost basis
- Benchmark energy intensity
Correct answer: Net incremental savings
Net incremental savings isolate the energy reductions directly caused by the new CPACE-funded measures, excluding savings from other simultaneous changes.
Question 5: Under CPACE underwriting standards, which type of property appraisal is generally considered most reliable for determining collateral value?
- Automated valuation model (AVM)
- Broker price opinion (BPO)
- MAI-certified independent full appraisal (Correct answer)
- County assessor's land schedule
Correct answer: MAI-certified independent full appraisal
An MAI-certified full appraisal by an independent state-licensed appraiser provides the most credible and defensible collateral valuation for CPACE underwriting.
Question 6: Which federal standard is most commonly referenced when evaluating lighting efficiency upgrades in a CPACE project?
- ASHRAE 90.1 (Correct answer)
- NFPA 101
- ICC 700
- LEED v4.1 BD+C
Correct answer: ASHRAE 90.1
ASHRAE 90.1 (Energy Standard for Buildings Except Low-Rise Residential) sets minimum efficiency requirements for commercial lighting and is the benchmark for savings calculations.
Question 7: A CPACE evaluator discovers that a proposed improvement is primarily cosmetic (e.g., decorative facade painting). How should this be treated in the application?
- Include it as an eligible improvement because it maintains the building envelope
- Exclude it because CPACE only funds improvements with measurable energy, water, or resiliency benefits (Correct answer)
- Include it if the property owner can demonstrate it improves property value
- Exclude it only if the project is in a Title I CPACE district
Correct answer: Exclude it because CPACE only funds improvements with measurable energy, water, or resiliency benefits
CPACE programs require that funded improvements produce quantifiable energy, water, or resiliency benefits; purely cosmetic work does not meet this standard.
CPACE Property Evaluation 3
Which property characteristic can disqualify a building from CPACE eligibility even if it meets all other criteria?