It appears that the Federal Housing Finance Agency has turned down a loan program that would help residents with upgrading their homes to be more energy efficient. This comes as a shock to lawmakers that determined the loan program could be just the thing needed to add jobs, and reduce greenhouse gasses across the nation.

In April, some states passed laws that granted local governments the ability to create the PACE program. PACE, Property Assessed Clean Energy, allowed people to pay for the upgrades to their homes to make them more efficient through property tax assessments. This would end up creating jobs and increase property values across the board.

Fed Refuses Energy Efficiency Loans

FHFA states that these loans could pose a risk to homeowners and mortgage lenders because they take priority over the original mortgage should the homeowner defaults, although the PACE legislation took on White House guidelines.

Many environmental groups say this is baseless and that the FAHA is just trying to thwart their plans to create something that is better than what is happening now. FAHA oversees the Freddie Mac and Fannie Mae mortgage lenders which reportedly hold half of the country’s mortgages and has received bailouts.