By Michael Gergen and David Pettit

On March 19, 2013, in County of Sonoma v. Federal Housing Finance Authority, the U.S Court of Appeals for the 9th Circuit joined the 2nd and 11th Circuits in upholding a directive from the Federal Housing Finance Authority (“FHFA”) that restricts Fannie Mae and Freddie Mac from purchasing mortgages on properties encumbered by first-priority liens made under so-called Property-Assessed Clean Energy (“PACE”) programs.

PACE programs allow states and municipalities to use their power…