The city of Iowa City is offering zero-interest loans to low-income homeowners to weatherize their residences for the winter.
By Molly Hunter
The Iowa City government is advertising a loan program designed to help low-income homeowners make their houses more energy-efficient.
The zero-interest loans are available to anyone living within the city limits whose income is 80 percent below the median income level.
In addition, a single person’s annual income cannot be more than $46,000, while the total income for two people must remain below $52,600. Loan recipients must also own their home, and they must live in the house.
The weatherization loans can be used in a variety of ways.
When working to increase energy efficiency, Xiaohui Zhou, the energy-efficiency program manager at the Iowa Energy Center, said it is best to first identify any air leakage.
“If you have a leaky house, you always have to pay to compensate for the heating and cooling,” he said.
To determine if there is leakage and where it is located, Zhou advises homeowners to call their energy-service provider.
“There are other contractors that can do the residential-leakage testing, but I think that’s for a fee,” he said.
Zhou said an energy audit is also a possibility. That usually involves someone coming into a home and taking a look at all the potential fixes the house may need.
The fixes can be as simple as ensuring the thermostat’s set points are not too high or too low, though Zhou said it sometimes pays to replace inefficient heating and cooling equipment.
The zero-interest loans provided by the city can be used to do this kind of replacement. However, Liz Osborne, a city program assistant for neighborhood development, said equipment purchased using the program’s funds must meet some requirements.
“We do require that the [new] furnace be at least 95 percent energy efficient [so] the homeowner will get rebates from MidAmerican or Alliant,” she said.
A replacement air conditioner, meanwhile, must be classed as energy efficient.
According to information on the city government website, the zero-interest loans max out at $4,000. This, Osborne said, is because the city doesn’t have to do verification processes for the homeowner to receive the money. However, Osborne encouraged low-income homeowners to reach out to the city even if their needs go beyond that amount.
“If it’s over $4,000, that doesn’t mean we can’t still help people out,” she said.
Aside from equipment replacement, Zhou said. “Put more insulation on your windows … that’s, I think, the biggest, [most] cost-effective way to reduce your energy bills.”
The city’s low-income weatherization loans may be used for this purpose as well.
“It all comes under the category of making the home more energy-efficient and cutting down on the heating costs,” Osborne said.
In most cases, she said, the loan sits on the property as long as the person owns and lives in the home. Once those requirements are no longer met, the zero-interest loan comes due. Osborne said payback loans are also zero-interest for those who qualify.
“And if they happen to live in a targeted area, half of the total loan will be forgiven over a period of five years,” she said.
The zero-interest loans are possible thanks to federal funds that the city receives, some of which is set aside for energy efficiency.
Similar types of assistance programs also exist at the state level, and demand for them is high. The Low-Income Home Energy Assistance Program is a prime example.
“Roughly speaking, we get about 80,000 to 85,000 households statewide that sign up for this program,” said Jerry McKim, the of the Bureau of Energy of Assistance in the Iowa Department of Human Rights.
He said around 30,000 households signed up for the 2017 program just in October, though the application deadline is months away: April 30, 2017.
Those not eligible for energy-efficiency-assistance programs can talk to their service provider for more information on how to qualify for rebates.