Municipal Energy Revolving Fund (MERF)
Loans for Vermont municipalities to audit and improve their buildings’ energy efficiency, including weatherization and replacing fossil-fuel heating.
Diese Finanzierungsmöglichkeit ist derzeit auf Englisch beschrieben.
Finance energy assessments and improvements to existing municipally owned buildings, including insulation, more efficient heating and renewable-energy measures. The Vermont Department of Buildings and General Services (BGS) administers MERF; Vermont Bond Bank disburses the loans and receives repayments.
The minimum loan is $100,000. BGS recommends requesting no more than $250,000 to benefit from the domestic-materials compliance waiver. Loan amounts are based on the proposed measures and available funds and may include a 10% contingency and/or a 20% allowance for project-related soft costs, such as design and management.
Loans executed in 2026 have 0% interest. That rate may change for loans executed in 2027 or later and may not apply to a blended loan combining MERF with another funding source. Repay the loan annually, with the first payment due one year after signing. Full repayment is due within ten years of signing or the financed asset’s useful life, whichever is shorter. A blended loan arranged with Vermont Bond Bank may have an exception to that final repayment date. Late or delinquent payments may incur penalties specified in the agreement.
There is no advance payment. Send contractor invoices to BGS and Vermont Bond Bank; after BGS approves an invoice, the Bond Bank transfers the amount needed to pay it. If you use less than the agreed loan amount, the repayment schedule is revised to reflect the actual amount borrowed.
Eligibility
- Eligible applicants are Vermont cities, towns, fire districts, incorporated villages and other governmental incorporated units, excluding school districts. Work must be on or within buildings owned by the municipality. Municipalities that applied for a MERP Implementation Grant but did not receive one receive priority.
- Each building must have a Level II energy assessment from within the past five years. If it does not, you may apply to finance the assessment and subsequent improvements. The assessment must be completed and on file with BGS before any loan money is used for improvements. Only the EERLF funding stream can pay for assessments; BGS assigns the appropriate stream, and projects cannot combine EERLF and EECBG funding.
- A compliant assessment is a MERP-provided Level II Energy Resilience Assessment or an ASHRAE Level II-or-higher building audit. Audits supporting the application must meet the Level II standard and provide data compatible with BuildingSync, the standardized format used for Department of Energy reporting. Proposed measures must demonstrate energy and cost savings; measures not recommended by the assessment are considered individually.
- Projects must fit the applicable federal funding categories. EECBG cannot fund regular maintenance or repairs. For EERLF, routine retrofit measures must follow the federal environmental limits, including appropriate sizing and no tree removal or trimming. Its standard renewable-energy route is for installations in or on existing structures without ground disturbance; solar electricity is limited to 60 kW under that route. Activities outside the federal allowable list, including ground disturbance or tree work, require additional Department of Energy environmental review and approval before starting.
- Projects must obtain required building permits and meet building codes. Environmental screening applies, particularly to work beyond routine retrofits. Historic-building work may require consultation with Vermont’s State Historic Preservation Office and must comply with the applicable historic-preservation requirements.
- Federally funded construction over $2,000 is subject to Davis-Bacon prevailing-wage requirements, with wage reports submitted to BGS weekly. Projects using covered materials and exceeding $250,000 in total federal funding must comply with Build America, Buy America domestic-sourcing rules and track material origins. BGS states that projects using less than $250,000 in federal funding receive a waiver. Where those material rules apply, quarterly reports cover project progress and material sourcing. BGS also coordinates documentation of energy and cost savings.
- Applications are assessed for ability to repay, financial need, geographic distribution and the proposed project. Vermont Bond Bank assesses repayment capacity. An attestation that you cannot fund the proposed measure without a loan earns financial-need points.
How to apply
- Status
- Laufende Antragstellung
- Beschränkungen dieser Antragsrunde
- General applications began July 1, 2026 and continue until all funds have been loaned.[^c15][^c16]
Apply using BGS’s online MERF form. Include a project narrative, the programme’s detailed budget worksheet, financial-history records and any existing Level II assessment documentation. Your regional planning commission can help with the application and technical questions; BGS handles programme inquiries at BGS.MERP@Vermont.Gov.
General applications are accepted until all funds have been loaned. The earlier priority-only intake has closed. BGS expects to notify applicants within three weeks of a complete application.
If selected, sign the loan agreement within one month of notification. Incur a project-related cost within one year of signing to begin work; paying for a required new assessment counts. Complete the project within two years of that first cost. Completion means self-certifying substantial completion when the assets are placed in service; unforeseen contingencies may justify an exception. Changes to the agreed project require a BGS request to amend the scope of work, with approval considered individually where the agreement allows amendments.