(a) A municipality may establish an energy improvement assessment program under AS 29.55.100 - 29.55.165 to finance the installation or modification of permanent improvements that are

(1) fixed to existing privately owned commercial or industrial property; and

(2) intended to reduce energy consumption or demand, energy costs, or emissions affecting local air quality, including a product, device, or interacting group of products or devices that use energy technology to generate electricity, provide thermal energy, or regulate temperature.

(b) To establish a program under AS 29.55.100 - 29.55.165, the governing body of a municipality shall take the following actions in the following order:

(1) adopt a resolution of intent that includes

(A) a finding that financing energy improvement projects through assessments serves a valid public purpose;

(B) a statement that the municipality intends to allow privately owned commercial or industrial property owners to make assessments to repay financing for energy improvement projects;

(C) a description of energy improvement projects that may be subject to assessments;

(D) a description of the boundaries of a region within the municipality's boundaries in which the program is available;

(E) a description of any proposed arrangements to make third- party financing available or any financing the municipality will provide for energy improvement projects; and

(F) a description of municipal debt servicing procedures for any third-party financing and assessments;

(2) prepare the report required under AS 29.55.110 and provide notice of the report with the

(A) location where the report is available for public inspection;

(B) time and place for a public hearing on the proposed program; and

(C) name of the local official who administers the program and the appropriate assessor or person who collects the proposed assessments with property taxes imposed on the assessed property;

(3) hold a public hearing at which the public may comment on the proposed program and the report prepared under AS 29.55.110; and

(4) adopt an ordinance establishing the program and the terms of the program, including each item included in the report required under AS 29.55.110, which may be incorporated by reference.

(c) A municipality may

(1) hire and set the compensation of a program administrator and program staff; or

(2) contract for professional services necessary to administer a program.

(d) A municipality may impose fees to offset the costs of administering a program. The fees authorized under this subsection may be assessed as a

(1) program application fee paid by the property owner applying to the program;

(2) component of the interest rate on the assessment in the written contract between the municipality and the property owner; or

(3) combination of (1) and (2) of this subsection.