Beaumont City Council
December 19, 2023

AP RO
Cii- Attorney
November 20.2023
Date
City Manager Date
I certify that such destruction meets the requirements of the City's Records Retention Schedule and all applicable requirements of State and Federal law and have been approved by City Council by Resolution No.

City Clerk Date of Records Destruction

BEAUMONT
cdtpu.

CITY OF BEAUMONT
To: City Clerk
From: Department Head
Subject: Request for Destruction of Records
I am requesting approval to destroy the records listed below because they have met the retention as specified in the City of Beaumont Retention Schedule. The records are not the subject of any claim, litigation, investigation, or audit.

Dephrtment Head
Date

DATE OF

LAST ACT

COMPLETED

IN FOLDER

DESCRIPTION OF RECORD(S)
TOTAL

RETENTION

RETENTION
CODE NO.
05/01/2014
Public Records Request
2 years
CC -041
09/19/2006
Correspondence Stetson Community
Min 2 years
CC -011
01/22/2015
Facility use permit Freedom in Christ Church
500 Grace Ave
2 years
CS -014
1979-1985
Performance Bonds
Release of
Bond/2 years
CC -010
1958-1971
Correspondence Engineering services Manning
& Hartwick/Hicks & Hartwick
2 years
CC -011
11/09/1970-
11/08/1995
Lease agreement City of Beaumont & Arnold
Stensland/Steve Silos 1977
Completion
+10 years
CC -006
07/1967-1977
Lease agreement City of Beaumont &
Friedrich Giljum & Irene
Completion
+10 years
CC -006
01/31/1970
Lease for fence- Beaumont Unified School
district and city expires 01/1980
Completion
+10 years
CC -006
10/05/1980
Exxon Lease expires 07/31/1986
Completion
+10 ' ears
CC -006
12/07/1981
Proposal & contract Banning Plumbing
Contractor Manhole installed re: Abby Animal
Clinic
Completion
+10 years
CC -006
03/03/1983
Sixth Street Median Improvements Labor for
installing A.C. Paving Terry Latham
Contractor
Completion
+10 years
CC -006
03/03/1983
Sixth Street Median Improvements Labor for
Completion
CC -006

installing class II Terry Latham Contractor
+10 years
05/01/1981
Maple St Rehabilitation & Overlay 12 St. to
13th St.

Completion
+10 years
CC -006
05/12/1971
Contract Slurry Seal Anderson Bros.

Engineering
y
Completion
+10 years
CC -006
04/12/1971-
04/1996
Lease (fence) yearly, Sal Valdivia
Completion
+10 years
CC -006
03/27/1980
FAU Project Preliminary Engineering
Agreement CJ Engineering
Completion
+10 years
CC -006
07/01/1981
FAU Project Preliminary Engineering
Agreement CJ Engineering
Completion
+10 years
CC -006
02/1929
Sewer Papers
5 years
FIN -003
06/30/1962
Correspondence re: Closing of streets by Board
of Supervisors opinion of City Attorney David
Berk declares action void
2 years
AD -007
08/03/1970
Correspondence Escrow statements from First
Western Bank for lot 24 & 25 Blk 115
2 years
AD -007
05/03/1946
Correspondence re: County of Riverside Letter
Garbage Dump
2 years
AD -007
04/30/1970
Correspondence re: Purchase alley right -of-
way blk 178
2 years
AD -007
10/17/1949
Correspondence re: City Dump County
Planning Commission
2 years
AD -007
06/30/1982
Performance Bond Baldi Const. Industrial Park
California Ave x First St.

Completion
+10 years
AD -001
1984
Field Cable American Cable of Redlands
Southland Cablevision
Completion
+10 years
AD -001
07/19/1979
Certificate of Insurance Alan M. Hess & Sons
Const. Co. Paving & Grading at E. 6th x
Highland Springs Rd
Completion
+10 years
AD -001
01/19/1982
Certificate of Insurance DVY Const. Co.

Completion
+10 years
AD -001
04/24/1975
Permit for gasoline storage & dispensing
facility
5 years
PW-042
04/29/1970
Permit -Dig at Dump Edwin Owens
Min. 2 years
PL -014
05/08/1974
Appraisal Lot NE Corner Intersection of 6th St
x Orange Ave lots 10, 12, 14 & 16 block 87
amended map
5 years
ED -004
1967
Lease -Leroy Gross
Completion
+10 years
CC -006
1924-1974
Oaths of Office
Term +4 years
CC -038
05/09/2003
Unsuccessful Proposal Power Resource
Managers, LLP
2 years
AD -003
05/10/2003
Unsuccessful Proposal MSE Power Systems,
Inc.
2 years
AD -003
1938-1939
Elections File re: Recall petition public
notice/Special Election absentee ballots
requests/Ballot order completion letter
2 years
CC -029

City Manager
05/12/2003
Unsuccessful Proposal AMT Applied Metering
Technologies, Inc
2 years
AD -003
05/07/2003
Unsuccessful Proposal SRM-ENCO Utility
Services
2 years
AD -003
05/13/2003
Unsuccessful Proposal Beaumont Utility
Services
2 years
AD -003
2004-2007
Recycling Reports
10 years
CC -048
Box 5
If additional space is needed to describe records, please add additional fields or attach additional pages)
November 20. 2023
Date
Date
I certify that such destruction meets the requirements of the City's Records Retention Schedule and all applicable requirements of State and Federal law and have been approved by City Council by Resolution No.

City Clerk Date of Records Destruction

BEAUMONT
- C !� 1 1 0 R "1 A
Staff Report
TO: City Council
FROM: Robert Vestal, Public Works Director
DATE December 19, 2023
SUBJECT: Amendment to TUMF Reimbursement Agreement
Description Amendment No. 1 to Transportation Uniform Mitigation Fee Program Agreement to Reimburse TUMF funds Potrero Boulevard Interchange PS&E Phase.

Background and Analysis:

On July 29, 2021, the Pass Zone 5 -year Transportation Improvement Program (TIP) allocated $6,500,000 to the Potrero Interchange Phase II project.

On September 7, 2021, City Council approved a Reimbursement Agreement with the Western Riverside Council of Governments (WRCOG) to use $250,000 from the TIP to recoup the cost associated with a revised traffic analysis for Potrero Interchange Phase City staff is requesting that City Council approve an amendment to the reimbursement agreement with WRCOG in order to recoup additional costs associated with the design of Potrero Interchange Phase I I . The anticipated cost to complete the design and be Ready to List (RTL) is approximately $2.7M. Subsequently, City staff is recommending increasing the reimbursement agreement to $3,000,000 total.

Fiscal Impact:

The cost of preparing the staff report is estimated to be $350. Cost associated with a future Professional Service Agreement for design will be reimbursed to the City via the reimbursement agreement with WRCOG.

Recommended Action:

Authorize the Mayor to execute Amendment No. 1 to Transportation Uniform Mitigation Fee Program Agreement to Reimburse TUMF funds Potrero Boulevard Interchange PS&E Phase.

Attachments:

A. Amendment No 1
B. Original Agreement

Project #
AMENDMENT NO. 1 TO TRANSPORTATION UNIFORM MITIGATION FEE

PROGRAM AGREEMENT

POTRERO BOULEVARD INTERCHANGE
This Amendment No. 1 to Transportation Uniform Mitigation Fee Program Agreement ("Amendment No. 1") is entered into this day of , 202, by and between the WESTERN RIVERSIDE COUNCIL OF GOVERNMENTS ("WRCOG") and City of Beaumont ("AGENCY"). WRCOG and the AGENCY are sometimes referred to individually as "Party" and collectively as "Parties."

RECITALS
A. WRCOG and AGENCY have entered into an agreement titled "Transportation Uniform Mitigation Fee Program Agreement" that is dated August 3, 2022 ("Agreement"). The Agreement provides the terms and conditions, scope of work, schedule and funding amount for the construction of the Potrero Boulevard Interchange (hereinafter the "Project").

B. The Parties desire to amend the Agreement by increasing the funding amount pursuant to Sections 6 and 33 of the Agreement.

C. Funds are being increased for this Project to complete the PS&E phase and will decrease the funds available for the construction phase.

AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and subject to the conditions contained herein, the Parties hereby agree as follows:

Project #

1. The Funding Amount contained in Section 2 of the Agreement is hereby increased by $2,750,000 from "$250,000" to an amount not to exceed "$3,000,000"

2. The foregoing increase in the Funding Amount is within the Maximum TUMF Share.

3. Exhibits "A", "A-1", and "A-2" of the Agreement are hereby replaced in their entirety by Exhibits "A", "A-1", and "A-2" of this Amendment No. 1, which are attached hereto and incorporated by reference.

4. The above -stated Recitals are hereby fully incorporated into this Amendment No.

1. 6. Except to the extent specifically modified or amended hereunder, all of the terms, covenants and conditions of the Agreement shall remain in full force and effect between the Parties hereto.

IN WITNESS WHEREOF, the Parties have caused this Amendment No. 1 to be executed by their duly authorized representatives to be effective on the day and year first written above.

WESTERN RIVERSIDE COUNCIL CITY OF BEAUMONT

OF GOVERNMENTS
By: By:

Dr. Kurt Wilson, Executive Director David Fenn, Mayor

Project #
Approved to Form:

By:

Steven C. DeBaun
General Counsel
Approved to Form:

By:

Attest:

By:

Project #
Exhibit A

SCOPE OF SERVICES

1. SCOPE OF WORK:

The SR-60/Portero Boulevard Interchange project in the City of Beaumont will construct a six ramp, partial cloverleaf interchange in the City of Beaumont between Jack Rabbit Trail and the I- 10/SR-60 junction. This is the second phase of a two-part project, where the first phase built the overcrossing of the SR -60 freeway.

Project #
EXHIBIT "A-1"

ESTIMATE OF COST
Phase
TUMF
LOCAL
TOTAL
PA&ED

COMPLETED
PS&E
$3,000,000
$3,000,000
RIGHT OF WAY*
$4,553,000
$4,553,000
CONSTRUCTION*
$11,500,000
$33,077,000
$44,577,000
TOTAL
$14,500,000
$37,630,000
$52,130,000
• *Not included in current agreement. Agreement is only for the PS&E phase.

Project #
EXHIBIT "A-2"

PROJECT SCHEDULE
TIMETABLE:

Phase
Estimated
Completion Date
Estimated Cost
Comments
PA&ED
Completed
PS&E
2/14/2025
$3,000,000

RIGHT OF WAY
2/14/2025
$4,553,000

CONSTRUCTION
11/15/2057
$44,577,000
TOTAL
$52,130,000

19-PS-BEA-1204

TRANSPORTATION UNIFORM MITIGATION FEE PROGRAM

AGREEMENT TO REIMBURSE TUMF FUNDS

POTRERO BOULEVARD INTERCHANGE

PS&E PHASE
THIS REIMBURSEMENT AGREEMENT ("Agreement") is entered into as of this day of , 20 , by and between the Western Riverside Council of Governments ("WRCOG"), a California joint powers authority and the City of Beaumont ("AGENCY"). WRCOG and AGENCY are sometimes hereinafter referred to individually as "Party" and collectively as "Parties".

RECITALS
A. WRCOG is the Administrator of the Transportation Uniform Mitigation Fee Program of Western Riverside County ("TUMF Program").

B. WRCOG has identified and designated certain transportation improvement projects throughout Western Riverside County as projects of regional importance ("Qualifying Projects" or "Projects"). The Qualifying Projects are more specifically described in that certain WRCOG study titled "TUMF Nexus Study", as may be amended from time to time. Qualifying Projects can have Regional or Zonal significance as further described in the TUMF Nexus Study.

C. The TUMF Program is funded by TUMF fees paid by new development in Western Riverside County (collectively, "TUMF Program Funds"). TUMF Program Funds are held in trust by WRCOG for the purpose of funding the Qualifying Projects.

D. The AGENCY proposes to implement a Qualifying Project, and it is the purpose of this Agreement to identify the project and to set forth the terms and conditions by which WRCOG will release TUMF Program Funds.

AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and subject to the conditions contained herein, the Parties hereby agree as follows:

1. Description of the Qualifying Project. This Agreement is intended to distribute TUMF Program Funds to the AGENCY for the Potrero Interchange Phase II (the "Project"), a Qualifying Project. The Work, including a timetable and a detailed scope of work, is more fully described in Exhibit "A" attached hereto and incorporated herein by reference and, pursuant to Section 20 below, is subject to modification if requested by the AGENCY and approved by WRCOG. The work shall be consistent with one or more of the defined WRCOG Call for Projects phases detailed herein as follows:
1) PA&ED — Project Approvals & Environmental Document
2) PS&E — Plans, Specifications and Estimates
3) R/W — Right of Way Acquisition and Utility Relocation 4) CON — Construction

19-PS-BEA-1204

2. WRCOG Funding Amount. WRCOG hereby agrees to distribute to AGENCY, on the terms and conditions set forth herein, a sum not to exceed Two Hundred Fifty Thousand Dollars ($250.000) to be used for reimbursing the AGENCY for eligible Project expenses as described in Section 3 herein ("Funding Amount"). The Parties acknowledge and agree that the Funding Amount may be less than the actual cost of the Project. Nevertheless, the Parties acknowledge and agree that WRCOG shall not be obligated to contribute TUMF Program Funds in excess of the maximum TUMF share identified in the TUMF Nexus Study ("Maximum TUMF Share"), as may be amended from time to time.

3. Project Costs Eligible for Advance/Reimbursement. The total Project costs ("Total Project Cost") may include the following items, provided that such items are included in the scope of work attached hereto as Exhibit "A" ("Scope of Work"): (1) AGENCY and/or consultant costs associated with direct Project coordination and support; (2) funds expended in preparation of preliminary engineering studies; (3) funds expended for preparation of environmental review documentation for the Project; (4) all costs associated with right-of-way acquisition, including right-of-way engineering, appraisal, acquisition, legal costs for condemnation procedures if authorized by the AGENCY, and costs of reviewing appraisals and offers for property acquisition; (5) costs reasonably incurred if condemnation proceeds; (6) costs incurred in the preparation of plans, specifications, and estimates by AGENCY or consultants; (7) AGENCY costs associated with bidding, advertising and awarding of the Project contracts; (8) construction costs, including change orders to construction contract approved by the AGENCY; (9) construction management, field inspection and material testing costs; and (10) any AGENCY administrative cost to deliver the Project.

4. Ineligible Project Costs. The Total Project Cost shall not include the following items which shall be borne solely by the AGENCY without reimbursement: (1) any AGENCY administrative fees attributed to the reviewing and processing of the Project; and (2) expenses for items of work not included within the Scope of Work in Exhibit "A".

5. Procedures for Distribution of TUMF Program Funds to AGENCY. (a) Initial Payment by the AGENCY. The AGENCY shall be responsible for initial payment of all the Project costs as they are incurred. Following payment of such Project costs, the AGENCY shall submit invoices to WRCOG requesting reimbursement of eligible Project costs. Each invoice shall be accompanied by detailed contractor invoices, or other demands for payment addressed to the AGENCY, and documents evidencing the AGENCY's payment of the invoices or demands for payment. Documents evidencing the AGENCY'S payment of the invoices shall be retained for four (4) years and shall be made available for review by WRCOG. The AGENCY shall submit invoices not more often than monthly and not less often than quarterly.
(b) Review and Reimbursement by WRCOG. Upon receipt of an invoice from the AGENCY, WRCOG may request additional documentation or explanation of the Project costs for which reimbursement is sought. Undisputed amounts shall be paid by WRCOG to the AGENCY within thirty (30) days. In the event that WRCOG disputes the eligibility of the AGENCY for reimbursement of all or a portion of an invoiced amount, the Parties shall meet

19-PS-BEA-1204
and confer in an attempt to resolve the dispute. If the meet and confer process is unsuccessful in resolving the dispute, the AGENCY may appeal WRCOG's decision as to the eligibility of one or more invoices to WRCOG's Executive Director. The WRCOG Executive Director shall provide his/her decision in writing. If the AGENCY disagrees with the Executive Director's decision, the AGENCY may appeal the decision of the Executive Director to the full WRCOG Executive Committee, provided the AGENCY submits its request for appeal to WRCOG within ten (10) days of the Executive Director's written decision. The decision of the WRCOG Executive Committee shall be final. Additional details concerning the procedure for the AGENCY's submittal of invoices to WRCOG and WRCOG's consideration and payment of submitted invoices are set forth in Exhibit "B", attached hereto and incorporated herein by reference.
(c) Funding Amount/Adjustment. If a post Project audit or review indicates that WRCOG has provided reimbursement to the AGENCY in an amount in excess of the Maximum TUMF Share of the Project, or has provided reimbursement of ineligible Project costs, the AGENCY shall reimburse WRCOG for the excess or ineligible payments within 30 days of notification by WRCOG.

6. Increases in Project Funding. The Funding Amount may, in WRCOG's sole discretion, be augmented with additional TUMF Program Funds if the TUMF Nexus Study is amended to increase the maximum eligible TUMF share for the Project. Any such increase in the Funding Amount must be approved in writing by WRCOG's Executive Director. In no case shall the amount of TUMF Program Funds allocated to the AGENCY exceed the then -current maximum eligible TUMF share for the Project. No such increased funding shall be expended to pay for any Project already completed. For purposes of this Agreement, the Project or any portion thereof shall be deemed complete upon its acceptance by WRCOG's Executive Director which shall be communicated to the AGENCY in writing.

7. No Funding for Temporary Improvements. Only segments or components of the construction that are intended to form part of or be integrated into the Project may be funded by TUMF Program Funds. No improvement which is temporary in nature, including but not limited to temporary roads, curbs, tapers or drainage facilities, shall be funded with TUMF Program Funds, except as needed for staged construction of the Project.

8. AGENCY's Funding Obligation to Complete the Project. In the event that the TUMF Program Funds allocated to the Project represent less than the total cost of the Project, the AGENCY shall provide such additional funds as may be required to complete the Project.

9. AGENCY's Obligation to Repay TUMF Program Funds to WRCOG; Exception For PA&ED Phase Work. Except as otherwise expressly excepted within this paragraph, in the event that: (i) the AGENCY, for any reason, determines not to proceed with or complete the Project; or (ii) the Project is not timely completed, subject to any extension of time granted by WRCOG pursuant to the terms of this Agreement; the AGENCY agrees that any TUMF Program Funds that were distributed to the AGENCY for the Project shall be repaid in full to WRCOG, and the Parties shall enter into good faith negotiations to establish a reasonable repayment schedule and repayment mechanism. If the Project involves work pursuant to a PA&ED phase,

19-PS-BEA-1204
AGENCY shall not be obligated to repay TUMF Program Funds to WRCOG relating solely to PA&ED phase work performed for the Project.

10. AGENCY's Local Match Contribution. AGENCY local match funding is not required, as shown in Exhibit "A" and as called out in the AGENCY's Project Nomination Form submitted to WRCOG in response to its Call for Projects.

11. Term/Notice of Completion. The term of this Agreement shall be from the date first herein above written until the earlier of the following: (i) the date WRCOG formally accepts the Project as complete, pursuant to Section 6; (ii) termination of this Agreement pursuant to Section 15; or (iii) the AGENCY has fully satisfied its obligations under this Agreement. All applicable indemnification provisions of this Agreement shall remain in effect following the termination of this Agreement.

12. Representatives of the Parties. WRCOG's Executive Director, or his or her designee, shall serve as WRCOG's representative and shall have the authority to act on behalf of WRCOG for all purposes under this Agreement. The AGENCY hereby designates Jeff Hart, Public Works Director or his or her designee, as the AGENCY's representative to WRCOG.

The AGENCY's representative shall have the authority to act on behalf of the AGENCY for all purposes under this Agreement and shall coordinate all activities of the Project under the AGENCY's responsibility. The AGENCY shall work closely and cooperate fully with WRCOG's representative and any other agencies which may have jurisdiction over or an interest in the Project.

13. Expenditure of Funds by AGENCY Prior to Execution of Agreement. Nothing in this Agreement shall be construed to prevent or preclude the AGENCY from expending funds on the Project prior to the execution of the Agreement, or from being reimbursed by WRCOG for such expenditures. However, the AGENCY understands and acknowledges that any expenditure of funds on the Project prior to the execution of the Agreement is made at the AGENCY's sole risk, and that some expenditures by the AGENCY may not be eligible for reimbursement under this Agreement.

14. Review of Services. The AGENCY shall allow WRCOG's Representative to inspect or review the progress of the Project at any reasonable time in order to determine whether the terms of this Agreement are being met.

15. Termination.
(a) Notice. Either WRCOG or AGENCY may, by written notice to the other party, terminate this Agreement, in whole or in part, in response to a material breach hereof by the other Party, by giving written notice to the other party of such termination and specifying the effective date thereof. The written notice shall provide a 30 day period to cure any alleged breach. During the 30 day cure period, the Parties shall discuss, in good faith, the manner in which the breach can be cured.
(b) Effect of Termination. In the event that the AGENCY terminates this Agreement, the AGENCY shall, within 180 days, repay to WRCOG any unexpended TUMF

19-PS-BEA-1204
Program Funds provided to the AGENCY under this Agreement and shall complete any portion or segment of work for the Project for which TUMF Program Funds have been provided. In the event that WRCOG terminates this Agreement, WRCOG shall, within 90 days, distribute to the AGENCY TUMF Program Funds in an amount equal to the aggregate total of all unpaid invoices which have been received from the AGENCY regarding the Project at the time of the notice of termination; provided, however, that WRCOG shall be entitled to exercise its rights under Section 5(b), including but not limited to conducting a review of the invoices and requesting additional information. Upon such termination, the AGENCY shall, within 180 days, complete any portion or segment of work for the Project for which TUMF Program Funds have been provided. This Agreement shall terminate upon receipt by the non -terminating Party of the amounts due to it hereunder and upon completion of the segment or portion of Project work for which TUMF Program Funds have been provided.
(c) Cumulative Remedies. The rights and remedies of the Parties provided in this Section are in addition to any other rights and remedies provided by law or under this Agreement.

16. Prevailing Wages. The AGENCY and any other person or entity hired to perform services on the Project are alerted to the requirements of California Labor Code Sections 1770 et seq., which would require the payment of prevailing wages were the services or any portion thereof determined to be a public work, as defined therein. The AGENCY shall ensure compliance with these prevailing wage requirements by any person or entity hired to perform the Project. The AGENCY shall defend, indemnify, and hold harmless WRCOG, its officers, employees, consultants, and agents from any claim or liability, including without limitation attorneys, fees, arising from its failure or alleged failure to comply with California Labor Code Sections 1770 et seq.

17. Progress Reports. WRCOG may request the AGENCY to provide WRCOG with progress reports concerning the status of the Project.

18. Indemnification.
(a) AGENCY Responsibilities. In addition to the indemnification required under Section 16, the AGENCY agrees to indemnify and hold harmless WRCOG, its officers, agents, consultants, and employees from any and all claims, demands, costs or liability arising from or connected with all activities governed by this Agreement including all design and construction activities, due to negligent acts, errors or omissions or willful misconduct of the AGENCY or its subcontractors. The AGENCY will reimburse WRCOG for any expenditures, including reasonable attorneys' fees, incurred by WRCOG, in defending against claims ultimately determined to be due to negligent acts, errors or omissions or willful misconduct of the AGENCY.
(b) WRCOG Responsibilities. WRCOG agrees to indemnify and hold harmless the AGENCY, its officers, agents, consultants, and employees from any and all claims, demands, costs or liability arising from or connected with all activities governed by this Agreement including all design and construction activities, due to negligent acts, errors or omissions or willful misconduct of WRCOG or its sub -consultants. WRCOG will reimburse the

19-PS-BEA-1204
AGENCY for any expenditures, including reasonable attorneys' fees, incurred by the AGENCY, in defending against claims ultimately determined to be due to negligent acts, errors or omissions or willful misconduct of WRCOG.
(c) Effect of Acceptance. The AGENCY shall be responsible for the professional quality, technical accuracy and the coordination of any services provided to complete the Project. WRCOG's review, acceptance or funding of any services performed by the AGENCY or any other person or entity under this Agreement shall not be construed to operate as a waiver of any rights WRCOG may hold under this Agreement or of any cause of action arising out of this Agreement. Further, the AGENCY shall be and remain liable to WRCOG, in accordance with applicable law, for all damages to WRCOG caused by the AGENCY's negligent performance of this Agreement or supervision of any services provided to complete the Project.

19. Insurance. The AGENCY shall require, at a minimum, all persons or entities hired to perform the Project to obtain, and require their subcontractors to obtain, insurance of the types and in the amounts described below and satisfactory to the AGENCY and WRCOG. Such insurance shall be maintained throughout the term of this Agreement, or until completion of the Project, whichever occurs last.
(a) Commercial General Liability Insurance. Occurrence version commercial general liability insurance or equivalent form with a combined single limit of not less than $1,000,000.00 per occurrence. If such insurance contains a general aggregate limit, it shall apply separately to the Project or be no less than two times the occurrence limit. Such insurance shall:
(i) Name WRCOG and AGENCY, and their respective officials, officers, employees, agents, and consultants as insured with respect to performance of the services on the Project and shall contain no special limitations on the scope of coverage or the protection afforded to these insured;
(ii) Be primary with respect to any insurance or self-insurance programs covering WRCOG and AGENCY, and/or their respective officials, officers, employees, agents, and consultants; and
(iii) Contain standard separation of insured provisions. (b) Business Automobile Liability Insurance. Business automobile liability insurance or equivalent form with a combined single limit of not less than $1,000,000.00 per occurrence. Such insurance shall include coverage for owned, hired and non -owned automobiles.
(c) Professional Liability Insurance. Errors and omissions liability insurance with a limit of not less than $1,000,000.00 Professional liability insurance shall only be required of design or engineering professionals.

19-PS-BEA-1204
(d) Workers' Compensation Insurance. Workers' compensation insurance with statutory limits and employers' liability insurance with limits of not less than $1,000,000.00 each accident.

20. Project Amendments. Changes to the characteristics of the Project, including the deadline for Project completion, and any responsibilities of the AGENCY or WRCOG may be requested in writing by the AGENCY and are subject to the approval of WRCOG's Representative, which approval will not be unreasonably withheld, provided that extensions of time for completion of the Project shall be approved in the sole discretion of WRCOG's Representative. Nothing in this Agreement shall be construed to require or allow completion of the Project without full compliance with the California Environmental Quality Act (Public Resources Code Section 21000 et seq.; "CEQA") and the National Environmental Policy Act of 1969 (42 USC 4231 et seq.), if applicable, but the necessity of compliance with CEQA and/or NEPA shall not justify, excuse, or permit a delay in completion of the Project.

21. Conflict of Interest. For the term of this Agreement, no member, officer or employee of the AGENCY or WRCOG, during the term of his or her service with the AGENCY or WRCOG, as the case may be, shall have any direct interest in this Agreement, or obtain any present or anticipated material benefit arising therefrom.

22. Limited Scope of Duties. WRCOG's and the AGENCY's duties and obligations under this Agreement are limited to those described herein. WRCOG has no obligation with respect to the safety of any Project performed at a job site. In addition, WRCOG shall not be liable for any action of AGENCY or its contractors relating to the condemnation of property undertaken by AGENCY or construction related to the Project.

23. Books and Records. Each party shall maintain complete, accurate, and clearly identifiable records with respect to costs incurred for the Project under this Agreement. They shall make available for examination by the other party, its authorized agents, officers or employees any and all ledgers and books of account, invoices, vouchers, canceled checks, and other records or documents evidencing or related to the expenditures and disbursements charged to the other party pursuant to this Agreement. Further, each party shall furnish to the other party, its agents or employees such other evidence or information as they may require with respect to any such expense or disbursement charged by them. All such information shall be retained by the Parties for at least four (4) years following termination of this Agreement, and they shall have access to such information during the four-year period for the purposes of examination or audit.

24. Equal Opportunity Employment. The Parties represent that they are equal opportunity employers and they shall not discriminate against any employee or applicant of reemployment because of race, religion, color, national origin, ancestry, sex or age. Such non- discrimination shall include, but not be limited to, all activities related to initial employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination.

25. Governing Law. This Agreement shall be governed by and construed with the laws of the State of California.

19-PS-BEA-1204

26. Attorneys' Fees. If either party commences an action against the other party arising out of or in connection with this Agreement, the prevailing party in such litigation shall be entitled to have and recover from the losing party reasonable attorneys' fees and costs of suit.

27. Time of Essence. Time is of the essence for each and every provision of this Agreement.

28. Headings. Article and Section Headings, paragraph captions or marginal headings contained in this Agreement are for convenience only and shall have no effect in the construction or interpretation of any provision herein.

29. Public Acknowledgement. The AGENCY agrees that all public notices, news releases, information signs and other forms of communication shall indicate that the Project is being cooperatively funded by the AGENCY and WRCOG TUMF Program Funds.

30. No Joint Venture. This Agreement is for funding purposes only and nothing herein shall be construed to make WRCOG a party to the construction of the Project or to make it a partner or joint venture with the AGENCY for such purpose.

31. Compliance With the Law. The AGENCY shall comply with all applicable laws, rules and regulations governing the implementation of the Qualifying Project, including, where applicable, the rules and regulations pertaining to the participation of businesses owned or controlled by minorities and women promulgated by the Federal Highway Administration and the Federal Department of Transportation.

32. Notices. All notices hereunder and communications regarding interpretation of the terms of this Agreement or changes thereto shall be provided by the mailing thereof by registered or certified mail, return receipt requested, postage prepaid and addressed as follows:

If to AGENCY:

If to WRCOG:

City of Beaumont
500 E. 6th Street
Beaumont, California 92223
Attention: Jeff Hart, Director of Public Works
Telephone: 951-769-8522
Facsimile: 951-769-8526
Western Riverside Council of Governments
3390 University Avenue; Suite 200
Riverside, California 92501
Attention: Christopher Gray, Deputy Executive Director
Telephone: (951) 405-6710
Facsimile: (951) 223-9720
Any notice so given shall be considered served on the other party three (3) days after deposit in the U.S. mail, first class postage prepaid, return receipt requested, and addressed to the

19-PS-BEA-1204
party at its applicable address. Actual notice shall be deemed adequate notice on the date actual notice occurred regardless of the method of service.

33. Integration; Amendment. This Agreement contains the entire agreement between the Parties. Any agreement or representation respecting matters addressed herein that are not expressly set forth in this Agreement is null and void. This Agreement may be amended only by mutual written agreement of the Parties.

34. Severability. If any term, provision, condition or covenant of this Agreement is held invalid or unenforceable, the remainder of this Agreement shall not be affected thereby.

35. Conflicting Provisions. In the event that provisions of any attached appendices or exhibits conflict in any way with the provisions set forth in this Agreement, the language, terms and conditions contained in this Agreement shall control the actions and obligations of the Parties and the interpretation of the Parties' understanding concerning the Agreement.

36. Independent Contractors. Any person or entities retained by the AGENCY or any contractor shall be retained on an independent contractor basis and shall not be employees of WRCOG. Any personnel performing services on the Project shall at all times be under the exclusive direction and control of the AGENCY or contractor, whichever is applicable. The AGENCY or contractor shall pay all wages, salaries and other amounts due such personnel in connection with their performance of services on the Project and as required by law. The AGENCY or consultant shall be responsible for all reports and obligations respecting such personnel, including, but not limited to: social security taxes, income tax withholding, unemployment insurance and workers' compensation insurance.

37. Effective Date. This Agreement shall not be effective until executed by both Parties. The failure of one party to execute this Agreement within forty-five (45) days of the other party executing this Agreement shall render any execution of this Agreement ineffective.

38. No Third Party Beneficiaries. There are no intended third party beneficiaries of any right or obligation assumed by the Parties.
[SIGNATURES ON FOLLOWING PAGE]

DocuSign Envelope ID: 896FBBFF-8AF4-4BAD-946D-EAE6CCD42A57 [PROJECT 19-PS-BEA-1204]
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their duly authorized representatives to be effective on the day and year first above -written.

WESTERN RIVERSIDE COUNCIL CITY OF BEAUMONT

OF GOVERNMENTS
DocuSigned by:
559AAO8D610442A...

By Date:

Kurt Wilson
Executive Director
8/4/2022
App j atgnBd 1:

By:

E5-413E3F1133634C0
Steven C. DeBaun
General Counsel
8/3/2022
Date:

19-PS-BEA-1204
EXHIBIT "A"

SCOPE OF WORK
SCOPE OF WORK:

The SR-60/Portero Boulevard Interchange project in the City of Beaumont will construct a six ramp, partial cloverleaf interchange in the City of Beaumont between Jack Rabbit Trail and the I-10/SR-60 junction. This is the second phase of a two-part project, where the first phase built the overcrossing of the SR -60 freeway.

Exhibit A

19-PS-BEA-1204
EXHIBIT "A-1"

ESTIMATE OF COST
Phase
TUMF
LOCAL
TOTAL
PA&ED
Complete
--
PS&E
$250,000
$1,694,743
$1,944,743
Complete
--

RIGHT OF WAY

CONSTRUCTION
$6,250,000*
--
$6,250,000
TOTAL
$6,500,000
--
$8,194,743
• *Not included in the current agreement. Agreement is only for the PS&E phase.

Exhibit A —1

19-PS-BEA-1204
EXHIBIT "A-2"

PROJECT SCHEDULE
TIMETABLE:

Phase
Estimated
Completion Date
Estimated Cost
Comments
PA&ED
Complete
PS&E
March 2023
$1,944,743

RIGHT OF WAY
Complete

CONSTRUCTION
July 2024
$25,000,000
TOTAL
$26,944,743
Exhibit A — 2

19-PS-BEA-1204
Elements of Compensation
EXHIBIT "B"

PROCEDURES FOR SUBMITTAL, CONSIDERATION AND PAYMENT OF INVOICES

1. For professional services, WRCOG recommends that the AGENCY incorporate this Exhibit "B-1" into its contracts with any subcontractors to establish a standard method for preparation of invoices by contractors to the AGENCY and ultimately to WRCOG for reimbursement of AGENCY contractor costs.

2. Each month the AGENCY shall submit an invoice for eligible Project costs incurred during the preceding month. The original invoice shall be submitted to WRCOG's Executive Director with a copy to WRCOG's Project Coordinator. Each invoice shall be accompanied by a cover letter in a format substantially similar to that of Exhibit "B-2".

3. For jurisdictions with large construction projects (with the total construction cost exceeding $10 million) under construction at the same time, may with the approval of WRCOG submit invoices to WRCOG for payment at the same time they are received by the jurisdiction. WRCOG must receive the invoice by the 5th day of the month in order to process the invoice within 30 days. WRCOG will retain 10% of the invoice until all costs have been verified as eligible and will release the balance at regular intervals not more than quarterly and not less than semi-annually. If there is a discrepancy or ineligible costs that exceed 10% of the previous invoice WRCOG will deduct that amount from the next payment.

4. Each invoice shall include documentation from each contractor used by the AGENCY for the Project, listing labor costs, subcontractor costs, and other expenses. Each invoice shall also include a monthly progress report and spreadsheets showing the hours or amounts expended by each contractor or subcontractor for the month and for the entire Project to date. Samples of acceptable task level documentation and progress reports are attached as Exhibits "B-4" and "B-5". All documentation from the Agency's contractors should be accompanied by a cover letter in a format substantially similar to that of Exhibit "B-3".

5. If the AGENCY is seeking reimbursement for direct expenses incurred by AGENCY staff for eligible Project costs, the AGENCY shall provide the same level of information for its labor and any expenses as required of its contractors pursuant to Exhibit "B" and its attachments.

6. Charges for each task and milestone listed in Exhibit "A" shall be listed separately in the invoice.

7. Each invoice shall include a certification signed by the AGENCY Representative or his or her designee which reads as follows:

Exhibit B

19-PS-BEA-1204
"I hereby certify that the hours and salary rates submitted for reimbursement in this invoice are the actual hours and rates worked and paid to the contractors or subcontractors listed.

Signed
Title
Date
Invoice No.

8. WRCOG will pay the AGENCY within 30 days after receipt by WRCOG of an invoice.

If WRCOG disputes any portion of an invoice, payment for that portion will be withheld, without interest, pending resolution of the dispute, but the uncontested balance will be paid.

9. The final payment under this Agreement will be made only after: (I) the AGENCY has obtained a Release and Certificate of Final Payment from each contractor or subcontractor used on the Project; (ii) the AGENCY has executed a Release and Certificate of Final Payment; and (iii) the AGENCY has provided copies of each such Release to WRCOG.

Exhibit B

19-PS-BEA-1204
EXHIBIT "B-1"
[Sample for Professional Services]
For the satisfactory performance and completion of the Services under this Agreement, Agency will pay the Contractor compensation as set forth herein. The total compensation for this service shall not exceed ( INSERT WRITTEN DOLLAR AMOUNT ) ($ INSERT NUMERICAL DOLLAR AMOUNT ) without written approval of Agency's City Manager [or applicable position] ("Total Compensation").

1. ELEMENTS OF COMPENSATION.

Compensation for the Services will be comprised of the following elements: 1.1 Direct Labor Costs; 1.2 Fixed Fee; and 1.3 Additional Direct Costs.

1.1 DIRECT LABOR COSTS.

Direct Labor costs shall be paid in an amount equal to the product of the Direct Salary Costs and the Multiplier which are defined as follows:

1.1.1 DIRECT SALARY COSTS
Direct Salary Costs are the base salaries and wages actually paid to the Contractor's personnel directly engaged in performance of the Services under the Agreement. (The range of hourly rates paid to the Contractor's personnel appears in Section 2 below.)

1.1.2 MULTIPLIER
The Multiplier to be applied to the Direct Salary Costs to determine the Direct Labor Costs is , and is the sum of the
following components:

1.1.2.1 Direct Salary Costs

1.1.2.2 Payroll Additives
The Decimal Ratio of Payroll Additives to Direct Salary Costs. Payroll Additives include all employee benefits, allowances for vacation, sick leave, and holidays, and company portion of employee insurance and social and retirement benefits, all federal and state payroll taxes, premiums for insurance which are measured by payroll costs, and other contributions and benefits imposed by applicable laws and regulations.

1.1.2.3 Overhead Costs
Exhibit B-1

19-PS-BEA-1204
The Decimal Ratio of Allowable Overhead Costs to the Contractor Firm's Total Direct Salary Costs. Allowable Overhead Costs include general, administrative and overhead costs of maintaining and operating established offices, and consistent with established firm policies, and as defined in the Federal Acquisitions Regulations, Part 31.2.

Total Multiplier
(sum of 1.1.2.1, 1.1.2.2, and 1.1.2.3)

1.2 FIXED FEE.

1.2.1 The fixed fee is $

1.2.2 A pro -rata share of the Fixed Fee shall be applied to the total Direct Labor Costs expended for services each month, and shall be included on each monthly invoice.

1.3 ADDITIONAL DIRECT COSTS.

Additional Direct Costs directly identifiable to the performance of the services of this Agreement shall be reimbursed at the rates below, or at actual invoiced cost.

Rates for identified Additional Direct Costs are as follows:

ITEM REIMBURSEMENT RATE
[ insert charges J
Per Diem $ /day
Car mileage $ /mile
Travel $ /trip
Computer Charges $ /hour
Photocopies $ /copy
Blueline $ /sheet
LD Telephone $ /call
Fax $ /sheet
Photographs $ /sheet
Travel by air and travel in excess of 100 miles from the Contractor's office nearest to Agency's office must have Agency's prior written approval to be reimbursed under this Agreement.

Exhibit B-1

19-PS-BEA-1204

2. DIRECT SALARY RATES
Direct Salary Rates, which are the range of hourly rates to be used in determining Direct Salary Costs in Section 1.1.1 above, are given below and are subject to the following:

2.1 Direct Salary Rates shall be applicable to both straight time and overtime work, unless payment of a premium for overtime work is required by law, regulation or craft agreement, or is otherwise specified in this Agreement. In such event, the premium portion of Direct Salary Costs will not be subject to the Multiplier defined in Paragraph 1.1.2 above.

2.2 Direct Salary Rates shown herein are in effect for one year following the effective date of the Agreement. Thereafter, they may be adjusted annually to reflect the Contractor's adjustments to individual compensation. The Contractor shall notify Agency in writing prior to a change in the range of rates included herein, and prior to each subsequent change.

POSITION OR CLASSIFICATION RANGE OF HOURLY RATES
[ sample_J
Principal $ .00 - $ .00/hour
Project Manager $ .00 - $ .00/hour
Sr. Engineer/Planner $ .00 - $ .00/hour
Project Engineer/Planner $ .00 - $ .00/hour
Assoc. Engineer/Planner $ .00 - $ .00/hour
Technician $ .00 - $ .00/hour
Drafter/CADD Operator $ .00 - $ .00/hour
Word Processor $ .00 - $ .00/hour

2.3 The above rates are for the Contractor only. All rates for subcontractors to the Contractor will be in accordance with the Contractor's cost proposal.

3. INVOICING.

3.1 Each month the Contractor shall submit an invoice for Services performed during the preceding month. The original invoice shall be submitted to Agency's Executive Director with two (2) copies to Agency's Project Coordinator.

3.2 Charges shall be billed in accordance with the terms and rates included herein, unless otherwise agreed in writing by Agency's Representative.

3.3 Base Work and Extra Work shall be charged separately, and the charges for each task and Milestone listed in the Scope of Services, shall be listed separately. The charges for each individual assigned by the Contractor under this Agreement shall be listed separately on an attachment to the invoice.

Exhibit B-1

19-PS-BEA-1204

3.4 A charge of $500 or more for any one item of Additional Direct Costs shall be accompanied by substantiating documentation satisfactory to Agency such as invoices, telephone logs, etc.

3.5 Each copy of each invoice shall be accompanied by a Monthly Progress Report and spreadsheets showing hours expended by task for each month and total project to date.

3.6 If applicable, each invoice shall indicate payments to DBE subcontractors or supplies by dollar amount and as a percentage of the total invoice.

3.7 Each invoice shall include a certification signed by the Contractor's Representative or an officer of the firm which reads as follows:

I hereby certify that the hours and salary rates charged in this invoice are the actual hours and rates worked and paid to the employees listed.

Signed
Title
Date
Invoice No.

4. PAYMENT

4.1 Agency shall pay the Contractor within four to six weeks after receipt by Agency of an original invoice. Should Agency contest any portion of an invoice, that portion shall be held for resolution, without interest, but the uncontested balance shall be paid.

4.2 The final payment for Services under this Agreement will be made only after the Contractor has executed a Release and Certificate of Final Payment.

Exhibit B-1

19-PS-BEA-1204
EXHIBIT B-2
Sample Cover Letter to WRCOG
Date
Western Riverside Council of Governments
3390 University Avenue; Suite 450
Riverside, California 92501
Attention: Deputy Executive Director
ATTN: Accounts Payable
Re: Project Title - Invoice #_
Enclosed for your review and payment approval is the AGENCY's invoice for professional and technical services that was rendered by our contractors in connection with the 2002 Measure "A" Local Streets and Roads Funding per Agreement No. effective (Month/Day/Year) .

The required support documentation received from each contractor is included as backup to the invoice.

Invoice period covered is from Month/Date/Year to Month/Date/Year .

Total Authorized Agreement Amount:

Total Invoiced to Date:

Total Previously Invoiced:

Balance Remaining:

Amount due this Invoice:
$0,000,000.00
$0,000,000.00
$0,000,000.00
$0,000,000.00
$0,000,000.00
I certify that the hours and salary rates charged in this invoice are the actual hours and rates worked and paid to the contractors listed.

By:
cc:

Name
Title
Exhibit B-2

19-PS-BEA-1204
EXHIBIT B-3
Sample Letter from Contractor to AGENCY
Month/Date/Year
Western Riverside Council of Governments
3390 University Avenue; Suite 200
Riverside, California 92501
Attention: Deputy Executive Director
Attn: Accounts Payable
Invoice #
For [type of services] rendered by [contractor name] in connection with [name of project] This is per agreement No. XX-XX-XXX effective Month/Date/Year .

Invoice period covered is from Month/Date/Year to Month/Date/Year Total Base Contract Amount:

Authorized Extra Work (if Applicable)
$000,000.00
$000,000.00
TOTAL AUTHORIZED CONTRACT AMOUNT: $000,000.00
Total Invoice to Date:

Total Previously Billed:

Balance Remaining:
$000,000.00
$000,000.00
$000,000.00
Amount Due this Invoice: $000,000.00
I certify that the hours and salary rates charged in this invoice are the actual hours and rates worked and paid to the employees listed,
By:

Name
Title
Exhibit B-3

19-PS-BEA-1204
EXHIBIT B-4

SAMPLE TASK SUMMARY SCHEDULE
(OPTIONAL)
Exhibit B-4

19-PS-BEA-1204
EXHIBIT B-5
Sample Progress Report
REPORTING PERIOD: Month/Date/Year to Month/Date/Year
PROGRESS REPORT: #1
A. Activities and Work Completed during Current Work Periods TASK 01 — 100% PS&E SUBMITTAL

1. Responded to Segment 1 comments from Department of Transportation

2. Completed and submitted Segment 1 final PS&E
B. Current/Potential Problems Encountered & Corrective Action Problems
None
C. Work Planned Next Period
Corrective Action
None
TASK 01 — 100% PS&E SUBMITTAL

1. Completing and to submit Traffic Signal and Electrical Design plans

2. Responding to review comments
Exhibit B-5

BEAUMONT
- C !� 1 1 0 R N A
Staff Report
TO: City Council
FROM: Lisa Leach, CPA Assistant Finance Director
DATE December 19, 2023
SUBJECT: Fiscal Year 2023 Popular Annual Financial Report Description Receive and file the City's Fiscal Year End 2023 Popular Annual Financial Report.

Background and Analysis:

On November 30th, the Finance and Audit Committee was presented with the draft FY2023 Annual Comprehensive Financial Report (ACFR). The Finance and Audit Committee recommended the ACFR be presented to Council on December 19, 2023, in final form. The ACFR presents the financial statements of the City in accordance with generally accepted accounting principles (GAAP) and audited in accordance with governmental auditing standards (GAS). To meet the diverse information needs of different users, an ACFR typically presents voluminous data at a high level of detail.

Due to the high level of detail and technical language within the ACFR it is recommended that governments produce a Popular Annual Financial Report (PAFR) to supplement the ACFR. This allows readers to receive selected information provided within the ACFR in a manner that is engaging and easy to understand for all users.

The Government Finance Officers Association (GFOA) provides guidance within its PAFR program that governments can use to create reports that show a government's commitment to increase the involvement of citizens and other interested parties. The report presented follows the GFOA guidance and criteria established within PAFR awards program.

Fiscal Impact:

The following report provides data that has already occurred and does not have fiscal impact to the current budget. Staff estimates the cost to prepare this staff report is approximately $350.

Recommended Action:

Receive and file the City's Fiscal Year End 2023 Popular Annual Financial Report.

Attachments:

A. FY 2023 Popular Annual Financial Report

BEAUMONT

CALIFORNIA
City of Beaumont
11 1 11 1 11 1111111111111111211111111111111 .4A7_111171111111LL11111111111I1LJJA1111111 11

BEAU MONT

CIVIC CENTER
2023

POPULAR ANNUAL

FINANCIAL REPORT
Prepared By:

Lisa Leach, CPA
Assistant Finance Director

MESSAGE FROM THE

FINANCE DIRECTOR

JENNIFER USTATION
To the Citizens of the City of Beaumont:

Welcome to the City of Beaumont's Popular Annual Financial Report (PAFR), for the fiscal year ending June 30, 2023. Our PAFR provides an overview of the City's financial position in a manner that is easy to understand and provides a brief analysis of where the City's revenues are derived and where those dollars are spent. The information in this report is based on the audited results presented in the City's Annual Comprehensive Financial Report (ACFR).

It is important to note, this PAFR is unaudited and is presented on a non-GAAP basis*. This means the presentation of financial data in this report differs from the GAAP basis presentation in the City's ACFR.

II hope you find this report helpful and encourage you to access the City's website ( www.beaumontca.gov) or contact Finance at (951) 572- 3236 for more detailed information about the City's finances.

Jennifer Ustation
*Generally Accepted Accounting Principles (GAAP) is a combination of authoritative standards and the commonly accepted way of recording and reporting accounting information. To review the audited GAAP-based, full disclosure financial statements, please refer to the City's ACFR, which is available on the City's website at www.beaumontca.gov .
www.beaumontca.gov

Table of Contents
About the City 1
Elected and appointed officials 2
City -Wide Organizationl Chart 3
City Demographics and Key Statistics 4
The City's Financial Position 6
Statement of Activities 7
The City's Assets and Investments 9
What the City Owes 10
Net Pension Liability 11
Governmental Activities:Highlights 12
Property Tax Highlights 13
Completed Projects 14
"Beaumont is a vibrant city whose charm is exceeded only by the remarkable people who call it home. While times have changed, the friendliness and hospitality that recall a simpler era have not. In Beaumont, residents enjoy a way of life that includes not only the charming characteristics ofa small town but all the amenities ofa dynamic suburban environment."

About the City
Beaumont has a rich history and is nestled in the foothills of the San Bernardino National Forest. Originally settled in the mid -1800s as a stop along the Southern Pacific Railroad, people drawn to the beautiful mountain views, crisp air and abundance of apple orchards remained in the area and City of Beaumont was incorporated on November 18, 1912.

Beaumont's continued growth can be attributed to its desirable location and its reputation as an affordable community that offers a high quality of life. Local officials, supported by engaged community members, have worked tirelessly to prepare for a sustainable future and a vibrant community. Exceptional public services that are provided for the community include community -oriented public safety, an excellent school system, and 18 scenic parks and recreation areas, ensuring that Beaumont is a great place to live, work and explore.

Lloyd White Julio Martinez Mike Lara David Fenn
Mayor Mayor Pro Tem
Elected and Appointed Officials
Jessica Voigt
Appointed Officials
Elizabeth Gibbs
City Manager
John Pinkney
City Attorney
Elaine Morgan City Clerk
Nicole Wheelwright Deputy City Clerk
AJ Patel. City Treasurer
Siomara Giroux Executive Assistant
Christina Taylor Deputy City Manager
Kari Mendoza Administrative Services Director
Sean Thuilliez Chief of Police
Jennifer Ustation Finance Director
Robert Vestal Public Works Director
Doug Story Community Services Director
Thaxton VanBelle General Manager of Utilities

City Clerk
COUNCIL MEMBERS (5)
ity Treasure
City -Wide Organizational Chart
ity Attorne
1 P -1-C 1
ity Manage
jeputy Cit4
Clerk
dministrativ
Services
Director
Community
Services
Director
Finance
Director

IExecutive
Assistant
Deputy City
Manager
Director of
Water
Reclamation
Police Chief
Public Works
Director

POPULATION
56,987

CITY DEMOGRAPHICS AND

KEY STATISTICS
SOURCE: US CENSUS BUREAU

MEDIAN HOME
PRICE
$535,000
Source: Riverside County Recorder

MEDIAN HOUSEHOLD
INCOME
$92,797

MEDIAN AGE AVERAGE HOUSEHOLD SIZE
37 3.08
PRINCIPAL EMPLOYERS 2023
Employer
Employees Rank % of Total City Employment
Amazon 6,300 1 77.20%
Beaumont Unified School District 1,377 2 16.87%
CJ Foods 630 3 7.72%
Walmart 526 4 6.45%

CITY DEMOGRAPHICS AND

KEY STATISTICS
Parks & Recreation Police
•
1 1�
9,579 City
Trees
A
MIIMD
18 Parks and
playgrounds
1 2,200 Class
Registrations
Public Works
286 street
lights repaired
640 lane miles
rehabilitated
688 lineal feet
sidewalk, curb
and gutter
repairs
4 . _
,.;)
2 1/
54 Sworn
officers
K-9 Officers11404__
ucE_
*If",
14,512 911 calls
49,545 service calls
Wastewater
31 Sewer lift
pumps
12 Lift
stations

THE CITY'S FINANCIAL POSITION
The Statement of Net Position presents information about the financial position of the City; much like a balance sheet does for a corporation. It represents the difference between all of its assets (what the City owns) and its liabilities (what the City owes) on an accrual basis. It is an indication of the City's financial health at the end of the fiscal year. Over time, increases or decreases in the City's net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating. For the fiscal year ended June 30, 2023, the Citywide net position improved by $20.5 million. The assets of the City exceeded its liabilities by $538.2 million (net position). The five-year history presented below, indicates positive growth for the City's net position Statement of Net Position - Citywide (in thousands)
2023
2022
2021
2020
2019
Assets - What We Own
$772,766
$751,313
$716,413
$708,167
$698,079
Deferred Outflows
$13,410
$6,237
$5,999
$5,873
$6,221
Liabilities - What We Owe
$245,733
$231,828
$251,420
$253,563
$262,302
Deferred Inflows
$2,252
$8,032
($881)
$278
$576
Total Net Position
$538,192
$517,690
$471,873
$460,199
$441,422
Net Position - 5 Year Comparison
202
• •
.I ' ••4
Business -Type
Governmental Pa:e 6

STATEMIENT OF ACTIVITIES
More formally referred to as the Statement of Activities, the City's income statements reflect all the financial activity for the City during the fiscal year ended June 30, 2023. This statement presents information to illustrate how the City's net position changed during the year as a result of the financial activity (i.e. revenues and expenses). This is a summarized version of the more detailed statement found in the City's complete ACFR. For fiscal year ended June 30, 2023, the City's revenues exceeded expenses by $45.5 million.

Statement of Activities - Citywide (in thousands)
2023
2022
2021
2020
2019
Revenues
$94,341
$103,415
$79,975
$76,877
$86,397
Expenses
$73,839
$57,836
$67,960
$58,099
$64,694
Change in Net Position
$20,502
$45,579
$12,015
$18,778
$21,703
Restatement of Net Position
$0
$239
($343)
$0
($1,527)
Beginning Net Position
$517,690
$471,872
$460,200
$441,422
$421,245
Ending Net Position
$538,192
$517,690
$471,872
$460,200
$441,422
* Restatement noted above was for accounting corrections

Where Money Came From Page 8
Alt Revenue Sources
(Statement of Activities)
The City's revenues decreased by
$9.07 million, with the majority due
to the following:
• $23 million loss on sale of assets
due to the disposal of wastewater
plant equipment, replaced by the
wastewater plant expansion.
• $5.9 million increase in
investment earnings
• $3 million increase in operating
grants
• $1.6 million increase in sales tax
revenue
• $3.4 million increase in all other
revenues.

Public Works

13.4%
Sewer

22.2%
Other Taxes

6.5%
Investment Earnings
5%
Other Revenue

4.2%
Capital Grants

15.3%
Charges for service

25.7%
Property Taxes

12.7%
The City's expenses increased by
$16.0 million, with the majority due
to the following:
• $4.0 million increase in public
safety, due to increase in
personnel and fire service
contract with Riverside County.

Sales Taxes

24.3%
Operating Grants

6.3%
Transit

3.9%
Community Services

6.8%
Community Development

4.3%
• $12.0 million increase due to increase in
personnel for General Government and Public
Works, plus an increase in depreciation.

General Gov't

14.4%
Interest and fiscal charges

3.4%
Public Safety

31.6%

HE Y' SETS AND INVESTM1ETIE
The City revised its investment policy at the end of Fiscal Year 2021 and was certified by the California Municipal Treasurers Association in March 2022. The intent of the policy is to formalize the framework for the investment activities that shall be exercised to ensure the effective and judicious fiscal and investment management of the City's funds. The City's portfolio shall be designed and managed in such a manner as to comply with state and local laws, provide for daily cash flow requirements, ensure consistency with the prioritized objectives of safety, liquidity, and return, and in a manner consistent with prudent investment management and worthy of the public trust. The chart below reflects the types of investments held by the City as of June 30, 2023.

INVESTMENT TYPE - $274,975,992
Restricted investments in CFD's
$80,000,707
Medium Term Notes
$6,540,949
US Treasury Notes Local Agency Investment Fund
$35,122,086 $47,452,568
Other Investments
$5,163,675
US Treasury Bills
$25,122,335
Money Market Funds
$75,573,672
Capital Assets, Net of Depreciation
The city develops a five-year Capital
Improvement Program (CIP) that projects
capital needs with a focus on public
safety, street repair and maintenance,
machinery and equipment, sewer, parks
and general infrastructure. In fiscal. year
2023, major capital improvements
included parks ($1.0 million), projects for
roads ($6.2 million), vehicles and
equipment ($1.9 million) and sewer
infrastructure ($4.0 million).

Construction In Progress
$125,782,867
achinery & Equip.
36,047,338
Land
$36,119,383
Infrastructure
$289,416,278

Pagel 0

WHAT THE CITY OWESAI
As of June 30, 2023, the City had outstanding long-term debt totaling $171.2 million. The debt increased by $3.5 million due to a combination of a decrease of $5.3 million from the scheduled debt -service payment and an increase of $8.8 million from CFD 2013-3 Revenue Bonds issued in Fiscal. Year 2023. A five-year history of the long-term debt for governmental and business -type activities shows the City has been reducing debt levels over time since 2019. In fiscal year 2019, the Beaumont Public Improvement Authority issued $81,105,000 of revenue bonds, to finance the acquisition and construction of certain improvements to the City's Wastewater system.

Long Term Debt of Bonds, Compensated
Absences, Claims and Judgements (In millions)
$186.4
$180.0
$173.3
201 2020 2021
$167.7
5171.2
2022 2023

COMPENSATED ABSENCES
$3,943,673

CLAIMS AND JUDGEMENTS
$2,301,856

WASTEWATER REVENUE BONDS
$82,840,347

LOCAL AGENCY REVENUE BONDS
$80,000,707

LEASE LIABILITIES
$760,266
Assigned liability related to unused employee earned vacation and compensatory leave time.

Actuarial estimates of current and potential insurance claims and settlements.

Bonds issued to finance the acquisition and construction of certain improvements to the City's Wastewater system.

Bonds issued to purchase District bonds to design or acquire certain public improvements relating to the District.

Lease payments for the right to use various equipment and vehicles.

NET PENSION LIABILITY
Substantially all City employees working the equivalent of 1,000 hours per fiscal year are eligible to participate in multiple -employer defined benefits plans administered by California Public Employees Retirement System (CaIPERS). The City currently offers two plans: the Safety Plan for public safety employees (i.e., Police employees) and the Miscellaneous Nan for all other city employees.

The largest impact on the City's long-term financial stability relates to the increase in pension costs from CaIPERS. Per the most recent CaIPERS annual valuation report, the funded status (the percentage of assets available to meet the total projected benefits payments) for the Safety and Miscellaneous Plans was 77.49% and 89.57%, respectively. The total net pension liability as of June 30, 2023 totaled $23.9 million. The net pension liability for each plan as of the last two fiscal year end dates is shown below:
$16,000,000
$14,000,000
$12,000,000
$10,000,000
$8,000,000
$6,000,000
$4,000,000
$2,000,000
5 -
Net Pension Liability - Safety vs Misc Plans
$5,710,864
$13,861,509
$3,935,827
$10,080,434
Safety Plan Miscellaneous
Note: Pers investment returns ending June 30, 2021 created a large decrease in net pension liability, due to gains on investments. Pers investment returns ending June 30, 2022 resulted in losses creating large increases at the end of Fiscal year 2023.

FY 2021 FY 2022
The City further allocates the total net pension liability by fund (i.e., Business -Type funds related to the activities of the Wastewater and Transit funds and Governmental funds related primarily to the City's General Fund activities). The distribution of the net pension liability by fund type is show below:
$25,000,000
$20,000,000
$15,000,000
$ 10,000,000
$5,0oo,oa0
Net Pension Liability - Fund Types
$2,822,522
58, 544, 660
$21,119,421
5-
$1,102,031
Business-TVpRages327 of 1064,ern mental Activities
FY 2021
1 FY 2022

CITY ACTIVITIES: HIGHLIGHTS
The General Fund is the government's primary operating fund and the most discretionary. It accounts for all financial resources of the general government, except those required to be recorded in another fund. A five-year history of the fund balance and its designations is below. The fund balance of the General Fund at June 30, 2023 was $41.8 million, a $3.8 million decrease from 2022 due to planned spend down of General Fund for projects.
550,000,000
$40,000,000
$30,000,000
$20,000,000
510,000,03o
5 -
Fund Balance - General Fund
1 1 1
2019 2020 2021 2022 2023
• Nonspendabe ■ Restricted • Committed • Assigned • Unassigned i
Fund Balance Components
Nonspendable - Inherently non -spendable
(e.g, receivables and prepaids items)
Restricted - Externally enforceable limitations on use
(e.g., Investment in Section 115 Trust)
Committed - Self-imposed [imitations on use (e.g., Self - Insurance and re -appropriation)
Assigned - Limitation resulting from intended use (e.g., capital assets)
Unassigned - Residual net resources (e.g., discretionary) Functions of the City can be separated into two categories, those primarily supported by taxes and intergovernmental revenues (governmental activities) and those intended to recover all or a significant portion of its costs through user fees and charges (business -type).

Sales and Use Tax
the point of sale.

Propert
on property as of January 1.
consumable tax levied
- legally enforceable liens
Intergovernmental
taxes and vehicle license collections.
motor vehicle in lieu
- revenue from
charges to customers, applicants, or
others who purchase, use or directly
benefits from the goods, services, or
privileges provided, or are otherwise
directly affected by the service.
• ■ _ - includes transient occupancy tax,
utility users tax, franchise fees and
investment income.
$30,000,000
$25,000,000
$20,000,000
$15,000,000
$10,000,000
s5,000,000
$-
Five -Year Revenue History -
Governmental Activities
i1 i
2019 2020
2021
2022
2023
• Sales and Use Tax • Property Tax ■ Intergovernmental • Charges for Services • Other

Page13
F:S TAILHIGHLIGHTSAI
Sales Tax is now the largest revenue source for the General Fund and is levied at the point -of sale. The amount of money collected through sales tax is contingent upon dollars spent on goods and services throughout the year. For Fiscal year 2023, the City of Beaumont's sales tax rate was

7.75%. The sales tax rate is set and imposed at the County level. Fiscal. year 2022 saw an increase of $18 million from the previous year, an increase of 203%. This was due to a reporting change in the commercial/industrial sector. Fiscal year 2023 saw an increase of $1.6 million from the previous year, an increase of 6.1%
SALES TAX COLLECTED -10 YEAR COMPARISON
30,000,000
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
0 .
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

CITY PROJECTS C LETIED'
•
PS EC

PUBLIC SAFETY ENTERPRISE COMMUNICATION
COMM thr Nexr•lirrw ggt,w Ciruneri,IU arion Sydow
T. Mier 1er,r the Canny o RW.rru4
In Fiscal Year 2022/2023, Beaumont
Police Department successfully
completed a comprehensive
communications system upgrade.

Preparations for this project spanned
prior years and culminated in 2023 with
the transition of user groups to the
countywide Public Safety Enterprise
Communications (PSEC) system. With
enhanced coverage and functionality
this is highly essential communication
equipment.

At the end of Fiscal Year 2023, Beaumont Parks and Recreation achieved a significant milestone in elevating the facilities at the Beaumont Sports Park. These upgrades include 160 sprinklers replaced, 150 yards of topsoil added, and the installation of 42 lights. These thoughtful improvements not only reflect the department's dedication to maintaining high -quality recreational spaces while increasing public safety, but directly benefits youth sports by providing optimal conditions for training and competition.

• • • • • •
1 • • • • • •
1 • • • • • •
II••••••
0 13 951-572-3236
[email protected]
www.beaumontca.gov
550 E. 6th Street, Beaumont,
CA 92223
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kr-fg I nstagram
fr Nextdoor

BEAUMONT

CALIFORNIA

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BEAUA MONTA -C L 1 F O R N 1 -
Staff Report
TO: City Council
FROM: Elizabeth Gibbs, City Manager
DATE December 19, 2023
SUBJECT: Resolution Authorizing the Issuance of Community Facilities District No. 2021-1 (Fairway Canyon) Special Tax Bonds, Series 2024 (the "2024 Bonds")
Description Adopt a resolution authorizing the issuance of its Special Tax Bonds, Series 2024 in a principal amount not to exceed sixteen million dollars ($16,000,000) and approving certain documents and taking certain other actions in connection therewithin.

Background and Analysis:

The City of Beaumont ("City") formed Community Facilities District No. 2021-1 (Fairway Canyon) ("District") on June 1, 2021, for the purpose of financing various public improvements and services required in connection with the proposed development within the District. On June 1, 2021, an election was held within the District at which the landowners eligible to vote approved the issuance of bonds in an amount not -to -exceed $19,500,000. Such bonds are secured by special taxes levied on property within the District.

The District comprises a portion of a master -planned community known as "Fairway Canyon." At buildout, Fairway Canyon is expected to consist of 3,300 residential units with 46 acres of commercial and industrial land uses and the balance set aside for public and quasi -public uses. As of November 1, 2023, the master developer of the property within Fairway Canyon, SDC Fairway Canyon, LLC ("Developer"), estimates that approximately 2,350 homes within Fairway Canyon have been completed and sold to individual homeowners.

The District, which is located west of the 10 freeway, east of Tukwet Canyon Parkway and north of Oak Valley Parkway, is planned for 529 single family homes at buildout.

The Developer has sold all property within the District to three merchant builders:

Woodside 05S LP ("Woodside"), D.R. Horton of Los Angeles Holding Company, Inc. ("DR Horton"), and Richmond American Homes of Maryland, Inc. ("Richmond American"). As of November 1, 2023, building permits (i.e. "Developed Property") had

been issued for 520 homes within the District. As of such date, 419 homes have been completed and conveyed to individual homeowners and Woodside, DR Horton and Richmond American owned 40, 23 and 47 lots, respectively.

Development and Ownership Status'
Developed Property
Individually Owned 419
DR Horton 23
Woodside 40
Richmond American 38
Total Developed Property2 520
Final Map Property
Richmond American 9
Total Final Map Property3 9
TOTALS 529
'As of November 1, 2023
2Building permit has been issued
3Property has a recorded final map but no building permit issued
The aggregate value of the property within the District subject to the Special Tax levy is $240,762,396. Based on the estimated principal amount of the bonds ($14,190,000), the District -wide value -to -lien ratio is approximately 13.45 to 1.

Discussion
Based on market conditions as of November 29, 2023, the 2024 Bonds are expected to be issued in a par amount of $14,190,000. Proceeds from the 2024 Bonds will be used primarily to reimburse the Developer for the cost of completing facilities within the District. A description of such facilities, which include but are not limited to sewer system improvements, storm drain improvements, dry utilities infrastructure, street improvements, and park improvements, is provided in the Preliminary Official Statement. After the issuance of the 2024 Bonds, future parity bonds may be issued only for refunding purposes.

Assuming City Council approves the resolution this evening, the 2024 Bonds are expected to price on or around January 10, 2024, and close approximately two weeks later. Provided in the table below are estimated financing statistics relating to the 2024 Bonds, as well as the projected special tax levy on homes within the District. As required under Section 5852.1 of the California Government Code, good faith estimates have been provided to the City by Urban Futures, Inc., the Municipal Advisor in

consultation with Stifel, Nicolaus & Company, Incorporated, as underwriter of the 2024 Bonds as Attachment A.

Select Financing and Levy Statistics
Par Amount $14,190,000
True Interest Rate 5.32%
Average Annual Debt (Principal and Interest) Payments $932,808 Total Debt (Principal and Interest) Payments $28,549,119 Fiscal Year 2024-25 Special Tax Levy Rate Per Developed $1,401 to Property $2,159
Based on market conditions as of November 29, 2023
The Fiscal Year 2024-25 special tax levy rate per developed property ranges from $1,408 to $2,169, depending on the size of the home. Such tax will not increase over time.

In addition to authorizing the issuance of the 2024 Bonds, the Resolution approves forms of the Preliminary Official Statement, the Bond Indenture, the Bond Purchase Agreement, and the Continuing Disclosure Certificate.
• Preliminary Official Statement: The Preliminary Official Statement (the "POS") is the "offering document" for the 2024 Bonds. It provides a description of the District, the 2024 Bonds, the proposed development within District, and any other information that would be material to a prospective investor's decision on whether to purchase the 2024 Bonds. The POS also contains the SEC mandated disclosure related to the Cease and Desist Order and the Beaumont Financing Authority's compliance history with its continuing disclosure undertakings. While the City's financing team (bond and disclosure counsel, consultants, and the underwriter) have participated in preparing the POS, City Council and staff are ultimately responsible for ensuring that the offering document is accurate, contains no misleading information and does not omit any information necessary to make the document not misleading to investors. As part of its obligations under federal securities laws, Council should review the Preliminary Official Statement.
• Bond Indenture: The Bond Indenture contains terms of the 2024 Bonds including, but not limited to, the payment and redemption provisions, the pledge of revenues to pay the 2024 Bonds, rights and duties of the Trustee, remedies upon a default in the payment of the 2024 Bonds, and other related matters. The agreement is entered into between the District and Zions Bancorporation, National Association, as the appointed Trustee for the 2024 Bonds.

• Continuing Disclosure Certificate: Executed for the benefit of bondholders, the Continuing Disclosure Certificate obligates the District to file an annual report each Fiscal Year which includes, among other things, the most recent audited financial statements of the City and financial data relating to the District. The District is also required to report certain events which are significant to bondholders if and when they occur.
• Bond Purchase Agreement: Pursuant to the Bond Purchase Agreement, the City agrees to sell the 2024 Bonds to the underwriter and the underwriter agrees to purchase the 2024 Bonds, subject to typical closing conditions. City staff, the City's municipal advisor, and bond counsel will sign off on the final pricing of the 2024 Bonds prior to the execution of the Bond Purchase Agreement.

Bond Counsel and the City Attorney have reviewed the attached financing documents on behalf of the City. If the Resolution is approved, City staff will continue to work with the financing team to finalize all of the aforementioned documents. As previously mentioned, the 2024 Bonds are expected to price on or around January 10, 2024 and close two weeks later.

Fiscal Impact:

The 2024 Bonds are paid from special taxes levied in the District. There is no fiscal impact to the City's General Fund. The City will, however, be required to provide administration for the District, which is funded as part of the annual special tax levy.

As previously mentioned, the Fiscal Year 2024-25 special tax levy rate per developed property ranges from $1,401 to $2,159, depending on the square footage of the home.

Such tax will not increase over time.

All figures herein are preliminary and subject to prevailing market conditions at the time of sale.

Recommended Action:

Waive the full reading and adopt by title only, "A Resolution of the City Council of the City of Beaumont, Acting as the Legislative Body of the City of Beaumont Community Facilities District No. 2021-1 (Fairway Canyon), Authorizing the Issuance of Its 2024 Special Tax Bonds, in an Aggregate Principal Amount Not to Exceed Sixteen Million Dollars ($16,000,000) and Approving Certain Documents and Taking Certain Other Actions in Connection Therewith".

Attachments:

A. Authorizing Resolution
B. Preliminary Official Statement
C. Bond Indenture
D. Continuing Disclosure Certificate
E. Bond Purchase Agreement
F. Appraisal Report
Good Faith Estimates follows this staff report.

GOOD FAITH ESTIMATES
The good faith estimates set forth herein are provided with respect to the 2024 Bonds in accordance with California Government Code Section 5852.1. Such good faith estimates have been provided to the City by Urban Futures, Inc., the City's Municipal Advisor (the "Municipal Advisor") in consultation with Stifel Nicolaus, the Underwriter of the 2024 Bonds.

Principal Amount. The Municipal Advisor has informed the City that, based on the City's financing plan, its good faith estimate of the aggregate principal amount of the 2024 Bonds to be sold is $14,190,000 (the "Estimated Principal Amount").

True Interest Cost of the Bonds. The Municipal Advisor has informed the City that, assuming that the respective Estimated Principal Amount of the 2024 Bonds is sold, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the true interest cost of the 2024 Bonds, which means the rate necessary to discount the amounts payable on the respective principal and interest payment dates to the purchase price received for the 2024 Bonds, is 5.32%.

Finance Charge of the Bonds. The Municipal Advisor has informed the City that, assuming that the Estimated Principal Amount of the 2024 Bonds is sold, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the finance charge for the 2024 Bonds, which means the sum of all fees and charges paid to third parties (or costs associated with the 2024 Bonds), is $412,850. Additionally, there will be an annual Trustee fee of $2,000 for as long as the 2024 Bonds are outstanding.

Amount of Proceeds to be Received. The Municipal Advisor has informed the City that, assuming the Estimated Principal Amounts of the 2024 Bonds is sold, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the amount of proceeds expected to be received by the City for sale of the 2024 Bonds, less the finance charge of the 2024 Bonds, as estimated above, and any reserves or capitalized interest paid or funded with proceeds of the 2024 Bonds, is $12,905,397.

Total Payment Amount. The Municipal Advisor has informed the City that, assuming that the Estimated Principal Amount of the 2024 Bonds is sold, and based on market interest rates prevailing at the time of preparation of such

estimate, its good faith estimate of the total payment amount, which means the sum total of all payments the City will make to pay debt service on the 2024 Bonds, plus the finance charge for the 2024 Bonds, as described above, not paid with the respective proceeds of the 2024 Bonds, calculated to the final maturity of the 2024 Bonds, is $28,549,119. Additionally, there will be an annual Trustee fee of $2,000 for as long as the 2024 Bonds are outstanding.

The foregoing estimates constitute good faith estimates only and are based on market conditions prevailing at the time of preparation of such estimates. The actual principal amount of the 2024 Bonds issued and sold, the true interest cost thereof, the finance charges thereof, the amount of proceeds received therefrom and total payment amount with respect thereto may differ from such good faith estimates due to (a) the actual date of the sale of the 2024 Bonds being different than the date assumed for purposes of such estimates, (b) the actual principal amount of 2024 Bonds sold being different from the respective Estimated Principal Amount, (c) the actual amortization of the 2024 Bonds being different than the amortization assumed for purposes of such estimates, (d) the actual market interest rates at the time of sale of the 2024 Bonds being different than those estimated for purposes of such estimates, (e) other market conditions, or (f) alterations in the City's financing plan, or a combination of such factors. The actual date of sale of the 2024 Bonds and the actual principal amount of 2024 Bonds sold will be determined by the City based on various factors. The actual interest rates borne by the 2024 Bonds will depend on market interest rates at the time of sale thereof. The actual amortization of the 2024 Bonds will also depend, in part, on market interest rates at the time of sale thereof. Market interest rates are affected by economic and other factors beyond the control of the City.

RESOLUTION NO.

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

BEAUMONT, ACTING AS THE LEGISLATIVE BODY OF CITY
OF BEAUMONT COMMUNITY FACILITIES DISTRICT NO.
2021-1 (FAIRWAY CANYON), AUTHORIZING THE ISSUANCE
OF ITS 2024 SPECIAL TAX BONDS IN AN AGGREGATE
PRINCIPAL AMOUNT NOT TO EXCEED $16,000,000 AND

APPROVING CERTAIN DOCUMENTS AND TAKING CERTAIN

OTHER ACTIONS IN CONNECTION THEREWITH
WHEREAS, the City Council (the "City Council," and sometimes referred to as the "legislative body of the District") of the City of Beaumont, California (the "City"), located in Riverside County, California, has heretofore undertaken proceedings and declared the necessity to issue bonds by the City of Beaumont Community Facilities District No. 2021-1 (Fairway Canyon) (the "District") pursuant to the terms and provisions of the Mello -Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Part 1, Division 2, Title 5 of the Government Code of the State of California (the "Act"); and WHEREAS, pursuant to resolutions adopted by the City Council on June 1, 2021 and the Act, the City formed the District; and
WHEREAS, pursuant to a resolution adopted by the City Council on June 1, 2021, a bond proposition was submitted to the qualified electors within the District and was approved by more than two-thirds of the votes cast at the elections held within the District on such date; and WHEREAS, based upon the aforesaid resolutions and election, the District is authorized pursuant to the Act to issue bonds in an aggregate principal amount not to exceed $19,500,000; and
WHEREAS, in order to effect the issuance of bonds in an aggregate principal amount not to exceed $16,000,000 to be designated as the "City of Beaumont Community Facilities District No. 2021-1 (Fairway Canyon) 2024 Special Tax Bonds" (the "Bonds"), the legislative body of the District desires to approve the forms, and authorize the execution and delivery, of a Bond Indenture, a Continuing Disclosure Certificate and a Bond Purchase Agreement for the Bonds; and
WHEREAS, in accordance with Government Code Section 53360.4, the legislative body of the District determines that a negotiated sale of the Bonds to Stifel, Nicolaus & Company, Incorporated (the "Underwriter") in accordance with the terms of the Bond Purchase Agreement for the Bonds to be entered into by the District and the Underwriter (the "Bond Purchase Agreement") will result in a lower overall cost to the District than a competitive sale; and WHEREAS, the legislative body of the District determines that it is prudent in the management of its fiscal affairs to issue the Bonds; and 1 4895-7473-9088v3/022599-0026

WHEREAS, based on the appraisal prepared by Integra Realty Resources, Inc. (the "Appraisal"), a state -certified real estate appraiser, as defined in Section 11340 of the California Business and Professions Code, of property within the District and the Fiscal Year 2023-24 assessed value of the property in the District that was not subject to the Appraisal, the value of the real property in the District subject to the special tax to pay debt service on the Bonds is more than three times the sum of the principal amount of the Bonds and the principal amount of all other bonds outstanding that are secured by a special tax levied pursuant to the Act or a special assessment levied on property within the District as calculated in the manner set forth in Section 53345.8(a) of the Act; and
WHEREAS, the legislative body of the District desires to authorize the preparation of an appraisal of the taxable real property within the District (the "Appraisal") which shall be prepared for the District by Integra Realty Resources, a state -certified real estate appraiser, as defined in Section 11340 of the California Business and Professions Code, in order for the legislative body of the District to make the above determination; and WHEREAS, the legislative body of the District further wishes to approve the form of the Preliminary Official Statement with respect to the Bonds (the "Preliminary Official Statement"), presented at this meeting; and
NOW, THEREFORE, the City Council of the City of Beaumont acting as the legislative body of City of Beaumont Community Facilities District No. 2021-1 (Fairway Canyon) does hereby resolve as follows:

SECTION 1. Each of the above recitals is true and correct, as is each of the findings and determinations set forth therein, and each of said recitals, findings and determinations is adopted by the legislative body of the District.

SECTION 2. The issuance of the Bonds in an aggregate principal amount not to exceed $16,000,000 is hereby authorized; and the exact principal amount to be issued shall be determined by the officer signing the Bond Purchase Agreement in accordance with Section 5 below. The Bonds shall mature on the dates and bear interest at the rates set forth in the Bond Purchase Agreement to be executed on behalf of the District in accordance with Section 5 hereof.

The Bonds shall be governed by the terms and conditions of the Bond Indenture between the District and Zions Bancorporation, National Association, as trustee, presented at this meeting (the "Bond Indenture"). The Bond Indenture shall be executed by one or more of the Mayor, the City Manager, the Administrative Services Director, or the Finance Director of the City or the written designee of one of the foregoing (collectively, the "Authorized Officers") and attested to by the City Clerk, substantially in the form presented at this meeting, with such additions thereto and changes therein as the officer or officers executing the same deem necessary (a) to cure any ambiguity or defect therein, if such addition or change does not materially alter the substance or content thereof, (b) to insert the offering price(s), interest rate(s), selling compensation, principal amount per maturity, redemption dates and prices and such other related terms and provisions as limited by Section 5 hereof, or (c) to conform any provisions therein to the Bond Purchase Agreement or the Official Statement delivered to the purchasers of the Bonds. Approval of such changes shall be conclusively evidenced by the execution and delivery of the Bond Indenture by 2 4895-7473-9088v3/022599-0026

one or more Authorized Officers. Capitalized terms used in this Resolution which are not defined herein have the meanings ascribed to them in the Bond Indenture.

SECTION 3. The Bonds shall be executed on behalf of the District by the manual or facsimile signature of the Mayor and attested with the manual or facsimile signature of the City Clerk, and by the trustee to be selected by the City (the "Trustee") to act as Trustee for the Bonds.

SECTION 4. The covenants set forth in the Bond Indenture above are hereby approved and shall be deemed to be covenants of the City Council, in its capacity as the legislative body of the District, and shall be complied with by the District and its officers.

SECTION 5. The form of the Bond Purchase Agreement presented at this meeting and the sale of the Bonds pursuant thereto are hereby approved, provided that the true interest cost on the Bonds does not exceed 6.00% and the discount at which the Underwriter purchases the Bonds (exclusive of original issue discount) does not exceed 1.20% of the principal amount thereof. Any one of the Authorized Officers is hereby authorized to execute the Bond Purchase Agreement, with such additions thereto and changes therein as the officer executing it may approve, such approval to be conclusively evidenced by the execution and delivery of the Bond Purchase Agreement. Each of the Mayor, the City Manager, the Administrative Services Director, and the Finance Director, or the designee of each of the foregoing, is authorized to determine the day on which the Bonds are to be priced in order to attempt to produce the lowest borrowing cost for the District and may reject any terms presented by the Underwriter if determined not to be in the best interest of the District.

SECTION 6. The form of the Continuing Disclosure Certificate presented at this meeting is hereby approved; and any one of the Authorized Officers is hereby authorized and directed to execute the Continuing Disclosure Certificate in the form hereby approved, with such additions therein and changes thereto as the Authorized Officer or Authorized Officers executing the same deem necessary to cure any defect or ambiguity therein if such change does not materially alter the substance or content thereof, with such approval to be conclusively evidenced by the execution and delivery of such Continuing Disclosure Certificate.

SECTION 7. In accordance with the requirements of Section 53345.8 of the Act, based on the Appraisal and the Fiscal Year 2023-24 assessed value of the property in the District that was not subject to the Appraisal, the legislative body of the District hereby determines that the value of the real property in the District subject to the special tax to pay debt service on the Bonds is more than three times the principal amount of the Bonds and the principal amount of all other bonds outstanding that are secured by a special tax levied pursuant to the Act or a special assessment levied on property within the District, all as calculated in the manner provided in Section 53345.8(a) of the Act.

SECTION 8. The Preliminary Official Statement, in substantially the form presented to this meeting and made a part hereof is hereby approved, with such changes, insertions and omissions therein as may be approved by any of the Authorized Officers, acting alone, and the use of the Preliminary Official Statement in connection with the offering and sale of the Bonds is hereby authorized and approved. The Authorized Officers are each hereby authorized to certify 3 4895-7473-9088v3/022599-0026

on behalf of the District that the Preliminary Official Statement is deemed final as of its date, within the meaning of Rule 15c2-12 (except for the omission of certain final pricing, rating and related information as permitted by Rule 15c2-12).

SECTION 9. The preparation and delivery of the Official Statement, and its use in connection with the offering and sale of the Bonds is hereby authorized and approved. The Official Statement shall be in substantially the form of the Preliminary Official Statement, with such changes, insertions and omissions as may be approved by an Authorized Officer, such approval to be conclusively evidenced by the execution and delivery thereof. Each of the Authorized Officers is hereby authorized, and any one of the Authorized Officers is hereby directed, for and in the name of the District, to execute the final Official Statement and any amendment or supplement thereto.

SECTION 10. Each of the Authorized Officers is authorized to provide for all services necessary to effect the issuance of the Bonds. Such services shall include, but not be limited to, obtaining legal services, municipal advisor services, special tax consultant services, trustee services and any other services deemed appropriate by an Authorized Officer. Any one of the Authorized Officers is authorized to pay for the cost of such services, together with other costs of issuance for the Bonds from the proceeds of the Bonds.

SECTION 11. The City Council hereby finds and declares that the issuance of the Bonds complies with the Debt Issuance and Management Policy adopted by the City with respect to debt financings (the "Debt Policy").

SECTION 12. The City Council acknowledges that the good faith estimates required by Section 5852.1 of the California Government Code are disclosed in the staff report and are available to the public at the meeting at which this Resolution is approved.

SECTION 13. Each of the Authorized Officers and the other officers and staff of the City of Beaumont and the District responsible for the fiscal affairs of the District are hereby authorized and directed to take any actions and to execute and deliver any and all documents as are necessary to accomplish the issuance, sale and delivery of the Bonds in accordance with the provisions of this Resolution and the fulfillment of the purposes of the Bonds as described in the Bond Indenture, including, but not limited to, amendments to the Acquisition Agreement dated as of June 1, 2021, by and between the City, the District and SDC Fairway Canyon, LLC. Any document authorized herein to be signed by the City Clerk may be signed by a duly -appointed deputy city clerk or assistant city clerk.

SECTION 14. The City Council hereby approves the execution and delivery of all agreements, documents, certificates and instruments referred to herein with electronic signatures as may be permitted under the California Uniform Electronic Transactions Act and digital signatures as may be permitted under Section 16.5 of the California Government Code using DocuSign.

PASSED AND ADOPTED by the City Council of the City of Beaumont, California, this 19th day of December, 2023, by the following vote:
4 4895-7473-9088v3/022599-0026

AYES:

NAYS:

ABSENT:

ABSTAIN:

MAYOR OF THE CITY OF BEAUMONT
ATTEST:

CITY CLERK
5 4895-7473-9088v3/022599-0026

° Stradling Yocca Carlson & Rauth
o Draft dated 12/11/23
a
o PRELIMINARY OFFICIAL STATEMENT DATED JANUARY _, 2024
rzl
NEW ISSUE —BOOK -ENTRY -ONLY NO RATING
U
° In the opinion of Stradling Yocca Carlson & Rauth, a Professional Corporation, Newport Beach, California ("Bond Counsel"), under existing statutes, regulations, rulings and judicial decisions, and assuming the accuracy of certain representations and compliance with certain covenants and requirements a), described herein, interest (and original issue discount) on the Bonds is excluded from gross income for federal income tax purposes and is not an item of tax = preference for purposes of calculating the federal alternative minimum tax imposed on individuals. In the further opinion of Bond Counsel, interest (and original q.., issue discount) on the Bonds is exempt from State of California personal income tax. See "TAX MATTERS" with respect to tax consequences relating to the o Bonds, including with respect to the alternative minimum fax imposed on certain large corporations for tax years beginning after December 31, 2022. . .o
tzi
o $14,190,000*
o CITY OF BEAUMONT
COMMUNITY FACILITIES DISTRICT NO. 2021-1 (FAIRWAY CANYON) 0 0 2024 SPECIAL TAX BONDS
oa) Dated: Delivery Date Due: September 1, as shown on the inside cover page ° This Official Statement describes bonds that are being issued by the City of Beaumont Community Facilities District No. 2021-1 (Fairway Canyon) Y )
o w (the "District"). The City of Beaumont Community Facilities District No. 2021-1 (Fairway Canyon) 2024 Special Tax Bonds (the "Bonds") are being issued by o ° the District to (a) pay the cost and expense of certain public facilities; (b) fund a reserve account securing the Bonds; and (c) pay costs of issuance of the Bonds. at t~
5 a) The Bonds are authorized to be issued pursuant to the Mello -Roos Community Facilities Act of 1982, as amended (Sections 53311 et seq. of the a Government Code of the State of California), and pursuant to a resolution adopted by the City Council of the City of Beaumont (the "City"), acting as the legislative body of the District, and a Bond Indenture, dated as of January 1, 2024 (the "Indenture"), by and between the District and Zions Bancorporation, National 6g Association, as trustee (the "Trustee").
y U
. .� The Bonds are limited obligations of the District and are payable solely from revenues derived from certain annual Special Taxes (as defined a�
0 herein) to be levied on and collected from the owners of parcels within the District subject to the Special Taxes and from certain other funds pledged H U under the Indenture, all as further described herein. The Special Taxes are to be levied according to the rate and method of apportionment approved by the City Council of the City and the qualified electors within the District. See "SOURCES OF PAYMENT FOR THE BONDS —Special Taxes." The c City Council of the City is the legislative body of the District. ,8- •o The Bonds are issuable in fully registered form and when issued will be registered in the name of Cede & Co., as nominee of The Depository Trust g Company, New York, New York ("DTC"). Individual purchases of the Bonds may be made in principal amounts of $5,000 and integral multiples thereof and will 2 be in book -entry form only. Purchasers of Bonds will not receive certificates representing their beneficial ownership of the Bonds but will receive credit balances cat d
cat on the books of their respective nominees. Interest on the Bonds will be payable semiannually on each March 1 and September 1, commencing September 1, 2024. ° • E o The Bonds will not be transferable or exchangeable except for transfer to another nominee of DTC or as otherwise described herein. Principal of and interest on .° • the Bonds will be paid by the Trustee to DTC for subsequent disbursement to DTC Participants who will remit such payments to the beneficial owners of the .2' io. s 'b Bonds. See "THE BONDS —General Provisions" and APPENDIX F —"BOOK -ENTRY ONLY SYSTEM" herein. o .. 3 NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE DISTRICT, THE CITY, THE COUNTY OF RIVERSIDE, THE a) STATE OF CALIFORNIA, OR ANY POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE BONDS. EXCEPT FOR THE NET ad TAXES, NO OTHER REVENUES OR TAXES ARE PLEDGED TO THE PAYMENT OF THE BONDS. THE BONDS ARE NOT GENERAL OR SPECIAL ;-. OBLIGATIONS OF THE CITY OR GENERAL OBLIGATIONS OF THE DISTRICT BUT ARE LIMITED OBLIGATIONS OF THE DISTRICT PAYABLE "C O

SOLELY FROM NET TAXES TO BE LEVIED IN THE DISTRICT AND CERTAIN OTHER AMOUNTS HELD UNDER THE BOND INDENTURE AS = •—' MORE FULLY DESCRIBED HEREIN.
cl
6) '6'. The Bonds are subject to redemption prior to maturity as set forth herein. See "THE BONDS —Redemption" herein. o - ° THE BONDS ARE NOT RATED BY ANY RATING AGENCY, AND INVESTMENT IN THE BONDS INVOLVES SIGNIFICANT RISKS aci 'o s: THAT ARE NOT APPROPRIATE FOR CERTAIN INVESTORS. CERTAIN EVENTS COULD AFFECT THE ABILITY OF THE DISTRICT TO o w PAY THE PRINCIPAL OF AND INTEREST ON THE BONDS WHEN DUE. SEE THE SECTION OF THIS OFFICIAL STATEMENT ENTITLED 0 , "SPECIAL RISK FACTORS" FOR A DISCUSSION OF CERTAIN RISK FACTORS THAT SHOULD BE CONSIDERED, IN ADDITION TO THE ce o OTHER MATTERS SET FORTH HEREIN, IN EVALUATING THE INVESTMENT QUALITY OF THE BONDS. 0 • 0 This cover page contains certain information for general reference only. It is not intended to be a summary of the security or terms of this issue. o Investors are advised to read the entire Official Statement to obtain information essential to the making of an informed investment decision. ``" Q MATURITY SCHEDULE
I .o (See Inside Cover Page)
'� •E _ The Bonds are offered when, as and if issued and accepted by the Underwriter, subject to approval as to their legality by Stradling Yocca Carlson & C Rauth, a Professional Corporation, Newport Beach, California, Bond Counsel, and subject to certain other conditions. Stradling Yocca Carlson & Rauth, a ', 0 Professional Corporation, Newport Beach, California is serving as Disclosure Counsel to the District with respect to the Bonds. Certain legal matters will be ' > passed on for the City and the District by Slovak, Baron, Empey, Murphy & Pinkney LLP, Palm Springs, California, and for the Underwriter by its counsel, Kutak a�°i 'b a Rock LLP, Irvine, California. It is anticipated that the Bonds in book -entry form will be available for delivery through the facilities of DTC on or about January E • 4 .5 _, 2024.

AEC; N •U
v1 E [STIFEL LOGO]
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w c4 . Dated: January , 2024
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H y 4861-1693-0704v51022599-0026

$14,190,000*

CITY OF BEAUMONT
COMMUNITY FACILITIES DISTRICT NO. 2021-1 (FAIRWAY CANYON) 2024 SPECIAL TAX BONDS

MATURITY SCHEDULE
Base CUSIP Not:

Serial Bonds
Maturity Date Principal
(September 1) Amount Interest Rate Yield Price CUSIP
Term Bonds
$ % Term Bonds due September 1, 20_, Yield: % Price: CUSIP No! $ % Term Bonds due September 1, 20_, Yield: % Price: CUSIP No! $ % Term Bonds due September 1, 20 , Yield: % Price: CUSIP No! * Preliminary, subject to change.

CUSIP® is a registered trademark of the American Bankers Association. CUSIP Global Services (CGS) is managed on behalf of the American Bankers Association by S&P Global Market Intelligence. Copyright© 2023 CUSIP Global Services. All rights reserved. CUSIP® data herein is provided by CUSIP Global Services. This data is not intended to create a database and does not serve in any way as a substitute for the CGS database. CUSIP® numbers are provided for convenience of reference only. None of the Underwriter or the District or their agents or counsel assume responsibility for the accuracy of such numbers. 4861-1693-0704v5/022599-0026

CITY OF BEAUMONT

COUNTY OF RIVERSIDE

CITY COUNCIL
Serving as the Legislative Body of
City of Beaumont Community Facilities District No. 2021-1 (Fairway Canyon) David Fenn, Mayor
Mike Lara, Mayor Pro Tem
Julio Martinez III, Council Member
Jessica Voigt, Council Member
Lloyd White, Council Member

CITY OFFICIALS
Elizabeth Gibbs, City Manager
Jennifer Ustation, Finance Director
Elaine Morgan, City Clerk
John Pinkney, City Attorney
AJ Patel, City Treasurer

BOND COUNSEL AND DISCLOSURE COUNSEL
Stradling Yocca Carlson & Rauth,
a Professional Corporation,
Newport Beach, California

MUNICIPAL ADVISOR
Urban Futures, Inc.

Walnut Creek, California

SPECIAL TAX CONSULTANT
Spicer Consulting Group, LLC
Murrieta, California

REAL ESTATE APPRAISER
Integra Realty Resources
Rocklin, California

TRUSTEE
Zions Bancorporation, National Association
Costa Mesa, California
4861-1693-0704v5/022599-0026

Except where otherwise indicated, all information contained in this Official Statement has been provided by the City and the District. No dealer, broker, salesperson or other person has been authorized by the City, the District, the Trustee or the Underwriter to give any information or to make any representations in connection with the offer or sale of the Bonds other than those contained in this Official Statement and, if given or made, such other information or representations must not be relied upon as having been authorized by the City, the District, the Trustee or the Underwriter. This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the Bonds by a person in any jurisdiction in which it is unlawful for such person to make such an offer, solicitation or sale.

This Official Statement is not to be construed as a contract with the purchasers or owners of the Bonds.

Statements contained in this Official Statement which involve estimates, forecasts or matters of opinion, whether or not expressly so described in this Official Statement, are intended solely as such and are not to be construed as representations of fact. This Official Statement, including any supplement or amendment to this Official Statement, is intended to be deposited with the Electronic Municipal Market Access System of the Municipal Securities Rulemaking Board, which can be found at www.emma.msrb.org .

The information set forth in this Official Statement which has been obtained from third party sources is believed to be reliable, but such information is not guaranteed as to accuracy or completeness by the City or the District. The information and expressions of opinion in this Official Statement are subject to change without notice, and neither the delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the City or the District or any other parties described in this Official Statement since the date of this Official Statement. All summaries of the Indenture or other documents are made subject to the provisions of such documents respectively and do not purport to be complete statements of any or all of such provisions. Reference is made by this Official Statement to such documents on file with the City for further information. While the City maintains an internet website for various purposes, none of the information on that website is incorporated by reference herein or intended to assist investors in making any investment decision or to provide any continuing information with respect to the Bonds or any other bonds or obligations of the City. Any such information that is inconsistent with the information set forth in this Official Statement should be disregarded.

The Underwriter has provided the following sentence for inclusion in this Official Statement:

The Underwriter has reviewed the information in this Official Statement in accordance with, and as a part of, its responsibilities to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information.

Certain statements included or incorporated by reference in this Official Statement constitute "forward -looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended. Such statements are generally identifiable by the terminology used such as "plan," "expect," "estimate," "project," "budget" or other similar words. Such forward -looking statements include, but are not limited to, certain statements contained in the information under the caption "THE COMMUNITY FACILITIES DISTRICT."

THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS CONTAINED IN SUCH

FORWARD -LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND

OTHER FACTORS WHICH MAY CAUSE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS

DESCRIBED TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD -LOOKING STATEMENTS. THE CITY

DOES NOT PLAN TO ISSUE ANY UPDATES OR REVISIONS TO THE FORWARD -LOOKING STATEMENTS SET FORTH IN THIS OFFICIAL STATEMENT.

IN CONNECTION WITH THE OFFERING OF THE BONDS, THE UNDERWRITER MAY

OVERALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET

PRICE OF SUCH BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARICET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.

THE BONDS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, IN RELIANCE UPON AN EXEMPTION CONTAINED IN SUCH ACT. THE BONDS HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES LAWS OF ANY STATE. 4861-1693-0704v5/022599-0026

TABLE OF CONTENTS
Page
INTRODUCTION 1
The District 1
Forward Looking Statements 2
Sources of Payment for the Bonds 3
Appraisal Report 5
Description of the Bonds 5
Professionals Involved in the Offering 6
Continuing Disclosure 6
SEC Order 6
Bond Owners' Risks 6
Other Information 7
ESTIMATED SOURCES AND USES OF FUNDS 7
THE BONDS 7
General Provisions 7
Debt Service Schedule 9
Redemption 10
Registration, Transfer and Exchange 13
SOURCES OF PAYMENT FOR THE BONDS 14
Limited Obligations 14
Special Taxes 14
No Teeter Plan 22
2024 Bonds Reserve Subaccount of the Reserve Account of the Special Tax Fund 22 Surplus Fund 23
Issuance of Parity Bonds for Refunding Purposes Only 23 THE COMMUNITY FACILITIES DISTRICT 23
General 23
Status of Development in the District 24
Description of Authorized Facilities 24
Property Values and the Appraisal 24
Value -to -Lien Ratios 26
Direct and Overlapping Debt 29
Delinquency History 31
Top Taxpayers 32
PROPERTY OWNERSHIP AND THE DEVELOPMENT 32
Fairway Canyon and the District 32
D.R. Horton Development and Financing Plan 33
Woodside Development and Financing Plan 35
Richmond American Development and Financing Plan 38
SPECIAL RISK FACTORS 40
Concentration of Ownership 40
Risks of Real Estate Secured Investments Generally 41
Limited Obligations 41
Insufficiency of Special Taxes 42
Increasing Mortgage Interest Rates 43
Impact of Economic Conditions on the Development in the District 44 Natural Disasters 44
Hazardous Substances 44
Direct and Overlapping Indebtedness 45
Payment of the Special Tax is not a Personal Obligation of the Property Owners 45 Property Values 45
4861-1693-0704v5/022599-0026

TABLE OF CONTENTS
(continued)
Page
Parity Taxes and Special Assessments 46
Disclosures to Future Purchasers 46
Enforcement Delays — Bankruptcy 47
Special Tax Delinquencies 47
FDIC/Federal Government Interests in Properties 48
Bankruptcy and Foreclosure 49
No Acceleration Provision 50
Loss of Tax Exemption 50
Limited Secondary Market 50
Proposition 218 50
Ballot Initiatives 51
Litigation with Respect to Community Facilities Districts 52 No Ratings — Limited Secondary Market 53
Potential Early Redemption of Bonds from Prepayments or Community Facilities District Bond Proceeds 53
Cybersecurity 53
Limitations on Remedies 53
CONTINUING DISCLOSURE 54
TAX MATTERS 54
LEGAL MATTERS 56
ABSENCE OF LITIGATION 56
NO RATING 56
UNDERWRITING 56
FINANCIAL INTERESTS 57
PENDING LEGISLATION 57
ADDITIONAL INFORMATION 57
APPENDIX A RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX A-1 APPENDIX B FORM OF OPINION OF BOND COUNSEL B-1

APPENDIX C DEMOGRAPHIC INFORMATION REGARDING THE COUNTY OF RIVERSIDE AND THE CITY OF BEAUMONT C-1
APPENDIX D SUMMARY OF CERTAIN PROVISIONS OF THE BOND INDENTURE D-1 APPENDIX E FORM OF DISTRICT CONTINUING DISCLOSURE CERTIFICATE E-1 APPENDIX F BOOK -ENTRY ONLY SYSTEM F-1
APPENDIX G SECURITIES AND EXCHANGE COMMISSION ORDER G-1 APPENDIX H APPRAISAL REPORT H-1
ii
4861-1693-0704v5/022599-0026

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4861-1693-0704v5/022599-0026

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4861-1693-0704v5/022599-0026

$14,190,000*

CITY OF BEAUMONT
COMMUNITY FACILITIES DISTRICT NO. 2021-1 (FAIRWAY CANYON) 2024 SPECIAL TAX BONDS

INTRODUCTION
The purpose of this Official Statement, which includes the cover page, the table of contents and the appendices (collectively, the "Official Statement"), is to provide certain information concerning the issuance by the City of Beaumont Community Facilities District No. 2021-1 (Fairway Canyon) (the "District") of its 2024 Special Tax Bonds (the "Bonds") in the aggregate principal amount of $14,190,000*. The proceeds of the Bonds will be used to (a) pay the cost and expense of certain public facilities; (b) fund a reserve account securing the Bonds; and (c) pay costs of issuance of the Bonds. See "ESTIMATED SOURCES AND USES OF FUNDS." The Bonds are authorized to be issued pursuant to the Mello -Roos Community Facilities Act of 1982, as amended (Section 53311 et seq. of the Government Code of the State of California) (the "Act"), and pursuant to a resolution adopted by the City Council of the City of Beaumont (the "City Council"), acting as the legislative body of the District, on December 19, 2023, and a Bond Indenture dated as of January 1, 2024 (the "Indenture"), by and between the District and Zions Bancorporation, National Association, as trustee (the "Trustee").

The Bonds are secured under the Indenture by a pledge of and lien upon Net Taxes (as defined herein) levied on parcels within the District and all moneys in the Special Tax Fund as described in the Indenture. See "SOURCES OF PAYMENT FOR THE BONDS."
The Bonds are being issued and delivered pursuant to the provisions of the Act and the Indenture. The Bonds are being sold pursuant to a Bond Purchase Agreement between the Underwriter (defined below) and the District. For more complete information, see "THE BONDS —General Provisions" and "UNDERWRITING" herein.

This introduction is not a summary of this Official Statement. It is only a brief description of and guide to, and is qualified by, more complete and detailed information contained in the entire Official Statement and the documents summarized or described herein. A full review should be made of the entire Official Statement.

The sale and delivery of Bonds to potential investors is made only by means of the entire Official Statement.

All capitalized terms used in this Official Statement and not defined shall have the meaning set forth in APPENDIX D —"SUMMARY OF CERTAIN PROVISIONS OF THE BOND INDENTURE — DEFINITIONS" herein.

The District
General. The District is located in the northwestern portion of the City of Beaumont (the "City") and is located to the west of the Interstate 10 freeway, east of Tukwet Canyon Parkway and north of Oak Valley Parkway. The development in the District is part of the master -planned community in the City known as "Fairway Canyon."
SDC Fairway Canyon, LLC, a Delaware limited liability company (the "Developer"), is the master developer of the property within Fairway Canyon, including the District. The Developer has sold all of the property planned for residential development within the District to three merchant builders: Woodside 05S, LP, a California limited partnership ("Woodside"); D.R. Horton Los Angeles Holding Company, Inc., a California corporation ("D.R. Horton"); and Richmond American Homes of Maryland, Inc., a Maryland corporation Preliminary, subject to change.
1 4861-1693-0704v5/022599-0026

("Richmond American"). The Developer no longer owns any property in the District that is subject to the Special Tax (as defined herein) levy.

The property in the District is planned for 529 single family homes at buildout. As of November 1, 2023, 419 homes within the District have been completed and conveyed to individual homeowners. As of such date, Woodside, D.R. Horton and Richmond American owned 40, 23 and 47 lots, respectively, in the District in various stages of construction. As of November 1, 2023, building permits had been issued for 520 of the 529 planned homes in the District.

The backbone infrastructure necessary to complete the development in the District has been completed and the in -tract infrastructure has been substantially completed. The merchant builders within the District expect to complete the remaining in -tract infrastructure for their respective projects commensurate with the timing for completion of the remaining planned homes. See the captions "PROPERTY OWNERSHIP AND THE DEVELOPMENTS —The Project —The Developer" for more information regarding Argent Management, and see the captions "PROPERTY OWNERSHIP AND THE DEVELOPMENT —The Developments" and "—The Merchant Builders" for more information regarding the merchant builders.

The District is part of "Fairway Canyon." At buildout, Fairway Canyon is expected to consist of approximately 3,300 residential units on approximately 1,556 acres of land, with 46.4 acres of commercial/industrial land uses and the balance set aside for public/quasi/public uses. As of November 1, 2023, the Developer estimates that approximately 2,350 homes within Fairway Canyon have been completed and sold to individual homeowners.

Formation Proceedings. The District was formed by the City pursuant to the Act and constitutes a governmental entity separate and apart from the City.

The Act was enacted by the California legislature to provide an alternative method of financing certain public capital facilities and services, especially in developing areas of the State. Any local agency (as defined in the Act) may establish a community facilities district to provide for and finance the cost of eligible public facilities and services. Generally, the legislative body of the local agency which forms a community facilities district acts on behalf of such district as its legislative body. Subject to approval by two-thirds of the votes cast at an election and compliance with the other provisions of the Act, a legislative body of a local agency may issue bonds for a community facilities district and may levy and collect a special tax within such district to repay such indebtedness.

Pursuant to the Act, the City formed the District on June 1, 2021. Subsequent to a noticed public hearing on June 1, 2021, the City Council adopted resolutions which established the District, authorized the levy of special taxes within the District, determined the necessity to incur bonded indebtedness within the District, and called an election within the District on the proposition of incurring bonded indebtedness, levying special taxes and setting an appropriations limit within the District.

On June 1, 2021, an election was held within the District at which the landowners eligible to vote approved the issuance of bonds for the District in an amount not to exceed $19,500,000 and approved a rate and method of apportionment of special tax for the District (the "Rate and Method"). A copy of the Rate and Method is attached hereto as Appendix A.

Forward Looking Statements
Certain statements included or incorporated by reference in this Official Statement constitute "forward - looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended. Such statements are generally identifiable by the terminology used such as a "plan," "expect," "estimate," "project," "budget" or similar words. Such forward -looking statements 2 4861-1693-0704v5/022599-0026

include, but are not limited to certain statements contained in the information under the "THE COMMUNITY FACILITIES DISTRICT" and "PROPERTY OWNERSHIP AND THE DEVELOPMENT."

THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS CONTAINED IN

SUCH FORWARD -LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS,

UNCERTAINTIES AND OTHER FACTORS WHICH MAY CAUSE ACTUAL RESULTS,

PERFORMANCE OR ACHIEVEMENTS DESCRIBED TO BE MATERIALLY DIFFERENT FROM ANY

FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD -LOOKING STATEMENTS. THE DISTRICT DOES NOT PLAN TO ISSUE ANY UPDATES

OR REVISIONS TO THE FORWARD -LOOKING STATEMENTS SET FORTH IN THIS OFFICIAL STATEMENT.

Sources of Payment for the Bonds
General. The Bonds and any Parity Bonds are limited obligations of the District, and the interest on and principal of and redemption premiums, if any, on the Bonds and any Parity Bonds are payable solely from the Special Taxes to be levied annually against the property in the District. To the extent necessary, the interest on and principal of and redemption premiums, if any, on the Bonds may be paid from the moneys on deposit in the 2024 Bonds Reserve Subaccount. As described herein, the Special Taxes are collected along with ad valorem property taxes on the tax bills mailed by the Treasurer -Tax Collector of the County of Riverside (the "County").

Although the Special Taxes will constitute a lien on the property subject to taxation in the District, they will not constitute a personal indebtedness of the owners of such property. There is no assurance that such owners will be financially able to pay the annual Special Taxes or that they will pay such taxes even if they are financially able to do so.

Limited Obligations. Except for the Special Taxes, no other taxes are pledged to the payment of the Bonds and any Parity Bonds. The Bonds and any Parity Bonds are not general or special obligations of the City nor general obligations of the District, but are special obligations of the District payable solely from Special Taxes collected in the District and amounts held under the Indenture as more fully described herein.

Special Tax. As used in this Official Statement, the term "Special Tax" refers to the "Special Tax for Facilities" (as defined in the Rate and Method) which has been authorized pursuant to the Act to be levied against certain land within the District pursuant to the Act and in accordance with the Rate and Method, including any scheduled payments and any Prepayments thereof, the net proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes to the amount of said lien and penalties and interest thereon; excluding, however, any delinquent Special Tax sold to an independent third -party or to the City for 100% of the delinquent amount. See "SOURCES OF PAYMENT FOR THE BONDS —Special Taxes" and APPENDIX A —"RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX." Under the Indenture, the District will pledge to repay the Bonds and any Parity Bonds from the Special Tax revenues remaining after the payment of annual Administrative Expenses of the District up to the Administrative Expenses Cap (the "Net Taxes") and from amounts on deposit in the Special Tax Fund established under the Indenture.

The Special Taxes are the primary security for the repayment of the Bonds and any Parity Bonds. In the event that the Special Taxes are not paid when due, the only sources of funds available to pay the debt service on the Bonds and any Parity Bonds are amounts held by the Trustee in the Special Tax Fund, and with respect to the Bonds, the amounts held in the 2024 Bonds Reserve Subaccount. See "SOURCES OF PAYMENT FOR THE BONDS -2024 Bonds Reserve Subaccount of the Reserve Account of the Special Tax Fund." The Special Tax was first levied in Fiscal Year 2022-23. See Table 7 herein under the caption "THE COMMUNITY FACILITIES DISTRICT —Delinquency History" for more information related to the Fiscal Years 2022-23 and 2023-24 Special Tax levies. No assurances can be made that Special Taxes will be collected in an amount required to make debt service payments on the Bonds. See "THE COMMUNITY FACILITIES 3 4861-1693-0704v5/022599-0026

DISTRICT —Delinquency History" and "SPECIAL RISK FACTORS —Special Tax Delinquencies" and "SPECIAL RISK FACTORS —Insufficiency of Special Taxes." 2024 Bonds Reserve Subaccount. The Indenture creates a 2024 Bonds Reserve Subaccount in the Reserve Account for the Bonds. In order to secure further the payment of principal of and interest on the Bonds, the District is required, upon delivery of the Bonds, to deposit in the 2024 Bonds Reserve Subaccount an amount equal to the 2024 Bonds Reserve Requirement and thereafter to maintain in the 2024 Bonds Reserve Subaccount an amount equal to the 2024 Bonds Reserve Requirement. The initial 2024 Bonds Reserve Requirement shall be $ , and the 2024 Bonds Reserve Requirement shall never exceed this amount. See "SOURCES OF PAYMENT FOR THE BONDS -2024 Bonds Reserve Subaccount of the Reserve Account of the Special Tax Fund."
Foreclosure Proceeds. The District will covenant in the Indenture for the benefit of the owners of the Bonds and Parity Bonds that it will: (i) commence judicial foreclosure proceedings against parcels with delinquent Special Taxes in excess of $2,500 by the December 1 following the close of each Fiscal Year in which such Special Taxes were due; (ii) commence judicial foreclosure proceedings against all parcels with delinquent Special Taxes by the December 1 following the close of each Fiscal Year in which it receives Special Taxes in an amount which is less than 95% of the total Special Tax levied; and (iii) diligently pursue such foreclosure proceedings until the delinquent Special Taxes are paid; provided that, notwithstanding the foregoing, the District may elect to defer foreclosure proceedings on any parcel so long as the amount in the 2024 Bonds Reserve Subaccount is at least equal to the 2024 Bonds Reserve Requirement and the amount in all other Subaccounts of the Reserve Account is at least equal to the applicable Reserve Requirement. See the caption "SOURCES OF PAYMENT FOR THE BONDS — Special Taxes —Proceeds of Foreclosure Sales." There is no assurance that the property within the District can be sold for the appraised or assessed values described herein, or for a price sufficient to pay the principal of and interest on the Bonds in the event of a default in payment of Special Taxes by the current or future property owners within the District. See the caption "SPECIAL RISK FACTORS —Property Values."
The District does not participate in the County's Alternative Method of Distribution of Tax Levies and Collections and of Tax Sale Proceeds (the "Teeter Plan"); accordingly, the collection of Special Taxes is subject to delinquency. See "SOURCES OF PAYMENT FOR THE BONDS —No Teeter Plan."

NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE DISTRICT, THE

CITY, THE COUNTY OF RIVERSIDE, THE STATE OF CALIFORNIA, OR ANY POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE BONDS. EXCEPT FOR THE SPECIAL TAXES, NO OTHER TAXES ARE PLEDGED TO THE PAYMENT OF THE BONDS. THE

BONDS ARE NOT GENERAL OR SPECIAL OBLIGATIONS OF THE CITY OR GENERAL

OBLIGATIONS OF THE DISTRICT, BUT ARE SPECIAL OBLIGATIONS OF THE DISTRICT

PAYABLE SOLELY FROM NET TAXES AND CERTAIN AMOUNTS HELD UNDER THE BOND INDENTURE AS MORE FULLY DESCRIBED HEREIN.

Additional Parity Bonds for Refunding Purposes Only. Under the Indenture, the District may issue additional indebtedness secured by the Net Taxes on a parity with the Bonds ("Parity Bonds") only to refund all or a portion of the Bonds or Parity Bonds. See the caption "SOURCES OF PAYMENT FOR THE BONDS — Issuance of Parity Bonds." Other taxes and/or special assessments with liens equal in priority to the continuing lien of the Special Taxes may also be levied in the future on the property within the District, which could adversely affect the willingness of the landowners to pay the Special Taxes when due. See the captions "THE COMMUNITY FACILITIES DISTRICT — Direct and Overlapping Debt" and "SPECIAL RISK FACTORS — Direct and Overlapping Indebtedness."
Liens. Other taxes and/or special assessments with liens equal in priority to the continuing lien of the Special Taxes have been levied and may also be levied in the future on the property within the District which could adversely affect the willingness of the landowners to pay the Special Taxes when due. See "SPECIAL 4 4861-1693-0704v5/022599-0026

RISK FACTORS —Parity Taxes and Special Assessments" herein. See Table 5 for a description of the direct and overlapping debt applicable to the parcels within the District.

Appraisal Report
Integra Realty Resources (the "Appraiser") has conducted an appraisal (the "Appraisal Report") with a date of value of November 1, 2023 (the "Date of Value") of the property in the District subject to the Special Tax to provide an estimate of the market value of the such property. The Appraisal Report provides an estimate of the approximate market value of the property in the District subject to the Special Tax in its current condition, assuming that development of the property as currently planned will consist of 529 single-family detached residential units.

To arrive at the estimated value of the property in the District subject to the Special Tax, the Appraiser applied the following methodology: (i) for 291 completed single family homes owned by individual homeowners and five completed model homes owned by the merchant builders, as shown on the County Assessor's roll as of January 1, 2023, the Appraiser used the Fiscal Year 2023-24 assessed values assigned by the County (totaling $156,232,396); and (ii) for the property relating to the remaining 233 planned or completed homes in the District, the Appraiser appraised such property using the methodology as described under "THE COMMUNITY FACILITIES DISTRICT —Appraisal Report." The property described in part (ii) of the foregoing sentence is referred to in this Official Statement as the "Appraised Property." Based on the assumptions and limiting conditions in the Appraisal Report, the Appraiser concluded that the minimum market value of the Appraised Property was $84,530,000 as of the Date of Value. The total estimated value of the property based on the foregoing assessed and appraised values is $240,762,396.

The Appraisal Report is based upon a variety of assumptions and limiting conditions that are described in Appendix H. The City, the District and the Underwriter make no representations as to the accuracy of the Appraisal Report. See "THE COMMUNITY FACILITIES DISTRICT —Appraisal Report" and "THE COMMUNITY FACILITIES DISTRICT —Value-to-Lien Ratios." There is no assurance that property within the District can be sold for the prices set forth in the Appraisal Report or that any parcel can be sold for a price sufficient to pay the Special Tax for that parcel in the event of a default in payment of Special Taxes by the landowner. See "THE COMMUNITY FACILITIES DISTRICT," "SPECIAL RISK FACTORS —Property Values," "SPECIAL RISK FACTORS —Impact of Economic Conditions on the Development in the District" and APPENDIX H —"APPRAISAL REPORT" herein.

Description of the Bonds
The Bonds will be issued and delivered as fully registered Bonds, registered in the name of Cede & Co. as nominee of The Depository Trust Company, New York, New York ("DTC"), and will be available to actual purchasers of the Bonds (the "Beneficial Owners") in the denominations of $5,000 or any integral multiple thereof, under the book -entry system maintained by DTC, only through brokers and dealers who are or act through DTC Participants as described herein. Beneficial Owners will not be entitled to receive physical delivery of the Bonds. In the event that the book -entry -only system described herein is no longer used with respect to the Bonds, the Bonds will be registered and transferred in accordance with the Indenture. See APPENDIX F — "BOOK -ENTRY ONLY SYSTEM."
Principal of, premium, if any, and interest on the Bonds is payable by the Trustee to DTC. Disbursement of such payments to DTC Participants is the responsibility of DTC and disbursement of such payments to the Beneficial Owners is the responsibility of DTC Participants. In the event that the book -entry only system is no longer used with respect to the Bonds, the Beneficial Owners will become the registered owners of the Bonds and will be paid principal and interest by the Trustee, all as described in the Indenture. See APPENDIX D — "SUMMARY OF CERTAIN PROVISIONS OF THE BOND INDENTURE —GENERAL AUTHORIZATION AND BOND TERMS —Transfers Outside Book -Entry System" herein. 5 4861-1693-0704v5/022599-0026

The Bonds are subject to optional redemption, extraordinary redemption, and mandatory sinking fund redemption as described herein. See "THE BONDS —Redemption." For a more complete description of the Bonds and the basic documentation pursuant to which they are being sold and delivered, see "THE BONDS" and APPENDIX D —"SUMMARY OF CERTAIN PROVISIONS OF THE BOND INDENTURE" herein.

Professionals Involved in the Offering
Zions Bancorporation, National Association, Costa Mesa, California, will act as Trustee under the Indenture. Stifel, Nicolaus & Company, Incorporated, will serve as the underwriter (the "Underwriter") of the Bonds. Certain proceedings in connection with the issuance and delivery of the Bonds are subject to the approval of Stradling Yocca Carlson & Rauth, a Professional Corporation, Newport Beach, California, Bond Counsel and Disclosure Counsel to the District in connection with the issuance of the Bonds. Certain legal matters will be passed on for the District and the City by Slovak, Baron, Empey, Murphy & Pinkney LLP, Palm Springs, California, for the Underwriter by Kutak Rock LLP, Irvine, California, as counsel to the Underwriter, and for the Trustee by its counsel. Other professional services have been performed by Integra Realty Resources, Rocklin, California, as the Appraiser, Urban Futures, Inc., Walnut Creek, California, as Municipal Advisor to the City and the District, and Spicer Consulting Group, LLC, Murrieta, California, as Special Tax Consultant.

Certain of the above -mentioned professionals, advisors, counsel and consultants may have a financial or other interest in the offering of the Bonds. See "FINANCIAL INTERESTS" herein.

Continuing Disclosure
The District has agreed to provide, or cause to be provided, pursuant to Rule 15c2-12 adopted by the Securities and Exchange Commission (the "Rule") certain financial information and operating data on an annual basis (the "District Reports"). The District has further agreed to provide, in a timely manner, notice of certain events with respect to the Bonds (the "Listed Events"). These covenants have been made in order to assist the Underwriter in complying with the Rule. The District Reports will be filed with the Electronic Municipal Market Access System ("EMMA") of the Municipal Securities Rulemaking Board (the "MSRB") available on the Internet at http://emma.msrb.org . Notices of Listed Events will also be filed with the MSRB. The District has not previously entered into any continuing disclosure obligations. The City will assist the District in preparing the District Reports. Within the last five years, a related entity of the City has failed to comply in certain respects with prior continuing disclosure undertakings. See "CONTINUING DISCLOSURE." See "CONTINUING DISCLOSURE" herein and Appendix E —"FORM OF DISTRICT CONTINUING DISCLOSURE CERTIFICATE."
SEC Order
On August 23, 2017, following an offer of settlement by the Beaumont Financing Authority (the "BFA"), the U.S. Securities and Exchange Commission ("SEC") entered a Cease -and -Desist Order and imposed certain undertakings on the BFA (the "SEC Order"). The BFA neither admits nor denies the findings in the SEC Order. The members of the City Council of the City act as the Board of Directors of the BFA and City staff acts as the staff of the BFA. A copy of the SEC Order is attached hereto as Appendix G.

Bond Owners' Risks
Certain events could affect the ability of the District to pay the principal of and interest on the Bonds when due. See the section of this Official Statement entitled "SPECIAL RISK FACTORS" for a discussion of certain factors which should be considered, in addition to other matters set forth herein, in evaluating an investment in the Bonds. The Bonds are not rated by any nationally recognized rating agency. The purchase of the Bonds involves significant risks, and the Bonds may not be appropriate investments for certain investors.

See "SPECIAL RISK FACTORS" herein.
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Other Information
This Official Statement speaks only as of its date, and the information contained herein is subject to change.

Brief descriptions of the Bonds and the Indenture are included in this Official Statement. Such descriptions and information do not purport to be comprehensive or definitive. All references herein to the Indenture, the Bonds and the constitution and laws of the State as well as the proceedings of the Board, acting as the legislative body of the District, are qualified in their entirety by references to such documents, laws and proceedings, and with respect to the Bonds, by reference to the Indenture. Capitalized terms not otherwise defined herein shall have the meanings set forth in the Indenture.

Copies of the Indenture and other documents and information are available for inspection and (upon request and payment to the District of a charge for copying, mailing and handling) for delivery from the City at 550 East 6th Street, Beaumont, California 92223.

ESTIMATED SOURCES AND USES OF FUNDS
The following table sets forth the expected sources and uses of Bond proceeds and certain Special Tax revenues collected.

Sources of Funds:

Principal Amount of Bonds
Plus Original Issue Premium
Special Taxes
Total Sources
Uses of Funds:

Acquisition and Construction Fund')
Costs of Issuance(2)
2024 Bonds Reserve Subaccount
Total Uses
(1) See "THE COMMUNITY FACILITIES DISTRICT —Description of Authorized Facilities" for a list of facilities eligible to be financed with Bond proceeds deposited into the Acquisition and Construction Fund. (2) Includes underwriter's discount, Bond Counsel fees, Disclosure Counsel fees, Special Tax Consultant fees, Municipal Advisor fees, Trustee fees, printing costs and other issuance costs.

Source: The Underwriter.

THE BONDS
General Provisions
The Bonds will be dated their date of delivery and will bear interest at the rates per annum set forth on the inside cover page hereof, payable semiannually on each March 1 and September 1, commencing September 1, 2024 (each, an "Interest Payment Date"), and will mature in the amounts and on the dates set forth on the inside cover page of this Official Statement. Interest will be calculated on the basis of a 360 -day year comprised of twelve 30 -day months. The Bonds will be issued in fully registered form in denominations of $5,000 or any integral multiple thereof.

Interest on any Bond will be payable from the Interest Payment Date next preceding the date of authentication of such Bond, unless: (i) such date of authentication is an Interest Payment Date, in which event interest will be payable from such date of authentication; (ii) the date of authentication is after the fifteenth day of the month preceding an Interest Payment Date, regardless of whether such day is a Business Day (each, a "Record Date") but prior to the immediately succeeding Interest Payment Date, in which event interest will be 7 4861-1693-0704v5/022599-0026

payable from the Interest Payment Date immediately succeeding the date of authentication; or (iii) the date of authentication is prior to the close of business on the first Record Date occurring after the issuance of such Bond, in which event interest will be payable from the dated date of such Bond, as applicable; provided, however, that if at the time of authentication of such Bond, interest is in default, interest on such Bond will be payable from the last Interest Payment Date to which the interest has been paid or made available for payment or, if no interest has been paid or made available for payment on such Bond, interest on such Bond will be payable from its dated date.

Interest on any Bond will be paid to the person whose name appears as its owner in the registration books held by the Trustee on the close of business on the Record Date. Principal of, and premium, if any, due upon redemption is payable upon presentation and surrender of the Bonds at the designated principal corporate trust office of the Trustee in Costa Mesa, California.

The Bonds will be issued as fully registered bonds and will be registered in the name of Cede & Co., as nominee of DTC. DTC will act as securities depository of the Bonds. Ownership interests in the Bonds may be purchased in book -entry form only in denominations of $5,000 and any integral multiple thereof. So long as DTC is the securities depository all payments of principal and interest on the Bonds will be made to DTC and will be paid to the Beneficial Owners in accordance with DTC's procedures and the procedures of DTC's Participants. See APPENDIX F —"BOOK -ENTRY -ONLY SYSTEM." In the event the Bonds are not held in book -entry form, interest will be paid by check of the Trustee mailed by first class mail, postage prepaid, to the Bondowner at its address on the registration books kept by the Trustee. Pursuant to a written request prior to the Record Date of a Bondowner of at least $1,000,000 in aggregate principal amount of Bonds or of any issue of Parity Bonds, payment will be made by wire transfer in immediately available funds to a designated account in the United States. [Remainder of Page Intentionally Left Blank]
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Debt Service Schedule
The following table presents the annual debt service on the Bonds (including sinking fund redemption), assuming there are no optional or extraordinary redemptions. See "SOURCES OF PAYMENT FOR THE BONDS" and "THE BONDS —Redemption."
Date
(September 1)
Total
Source: The Underwriter.

Principal
Interest Total
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Redemption
Optional Redemption. The Bonds may be redeemed at the option of the District from any source of funds on any Interest Payment Date on or after September 1, 20_, in whole or in part, from such maturities as are selected by the District and by lot within a maturity, at the following redemption prices, expressed as a percentage of the principal amount to be redeemed, together with accrued interest to the date of redemption:

Redemption Date
Redemption Price
In the event that the District elects to redeem Bonds as provided above, the District will give written notice to the Trustee of its election to so redeem, the redemption date and the principal amount of the Bonds of each maturity to be redeemed. The notice to the Trustee will be given at least 30 but no more than 60 days prior to the redemption date, or by such later date as is acceptable to the Trustee.

Mandatory Sinking Fund Redemption. The Bonds maturing on September 1, 20 (the "20 Term Bonds") will be called before maturity and redeemed, from the Sinking Fund Payments that have been deposited into the Redemption Account established under the Indenture, on September 1, 20_, and on each September 1 thereafter prior to maturity, in accordance with the schedule of Sinking Fund Payments set forth below. The 20 Term Bonds so called for redemption will be selected by the Trustee by lot and will be redeemed at a redemption price for each redeemed 20 Term Bond equal to the principal amount thereof, plus accrued interest to the redemption date, without premium, as follows:

Term Bonds Maturing September 1, 20
Sinking Fund Redemption Date
(September 1)
Maturity.

Sinking Fund Payments
The Bonds maturing on September 1, 20 (the "20 Term Bonds") will be called before maturity and redeemed, from the Sinking Fund Payments that have been deposited into the Redemption Account established under the Indenture, on September 1, 20 , and on each September 1 thereafter prior to maturity, in accordance with the schedule of Sinking Fund Payments set forth below. The 20 Term Bonds so called for redemption will be selected by the Trustee by lot and will be redeemed at a redemption price for each redeemed 20 Term Bond equal to the principal amount thereof, plus accrued interest to the redemption date, without premium, as follows:
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Term Bonds Matu ring September 1, 20_
Sinking Fund Redemption Date
(September 1)
Maturity.

Sinking Fund Payments
The Bonds maturing on September 1, 20 (the "20 Term Bonds") will be called before maturity and redeemed, from the Sinking Fund Payments that have been deposited into the Redemption Account established under the Indenture, on September 1, 20_, and on each September 1 thereafter prior to maturity, in accordance with the schedule of Sinking Fund Payments set forth below. The 20_ Term Bonds so called for redemption will be selected by the Trustee by lot and will be redeemed at a redemption price for each redeemed 20 Term Bond equal to the principal amount thereof, plus accrued interest to the redemption date, without premium, as follows:

Term Bonds Maturing September 1, 20_
Sinking Fund Redemption Date
(September 1)
*
Maturity.

Sinking Fund Payments
If the District purchases Term Bonds during the Fiscal Year immediately preceding one of the sinking fund redemption dates specified above, the District will notify the Trustee at least 45 days prior to the redemption date as to the principal amount purchased, and the amount purchased will be credited at the time of purchase to the next Sinking Fund Payment for the Term Bond so purchased, to the extent of the full principal amount of the purchase. All Term Bonds purchased will be cancelled pursuant to the Indenture.

In the event of a partial optional redemption or special mandatory redemption of the Term Bonds, each of the remaining Sinking Fund Payments for such Term Bonds will be reduced, as nearly as practicable, on a pro rata basis.

Special Mandatory Redemption from Special Tax Prepayments. The Bonds are subject to special mandatory redemption as a whole or in part on a pro rata basis among maturities and by lot within a maturity, on any Interest Payment Date on or after September 1, 2024, and will be redeemed by the Trustee, from any amounts paid by the District to the Trustee and designated by the District as a prepayment of Special Taxes for one or more parcels in the District made in accordance with the Rate and Method (the "Prepayments") deposited to the Redemption Account pursuant to the Indenture, plus amounts transferred from the 2024 Bonds Reserve Subaccount pursuant to the Indenture, at the following redemption prices, expressed as a percentage of the principal amount to be redeemed, together with accrued interest to the redemption date:
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Redemption Date
Redemption Price
Prepayments will be allocated to the payment at maturity and redemption of Bonds and any Parity Bonds as nearly as practicable on a proportionate basis based on the outstanding principal amount of the Bonds and any Parity Bonds and such amounts shall be applied to redeem Bonds and Parity Bonds as nearly as practicable on a pro rata basis among maturities in increments of $5,000; provided, however, that, for Prepayments of less than $50,000, the District may specify in a Certificate of an Authorized Representative that Prepayments be applied to one or more maturities of the Bonds or Parity Bonds so long as there is delivered to the Trustee a certificate of the Independent Financial Consultant that, following such application of the Prepayments, the maximum Special Taxes that may be levied in each Fiscal Year on Taxable Property is not less than 110% of Annual Debt Service, plus the Administrative Expenses Cap, in the Bond Year that begins in such Fiscal Year.

See the caption "SPECIAL RISK FACTORS —Potential Early Redemption of Bonds from Prepayments or Other Sources" for a discussion of the potential for a lower -than -expected yield on the Bonds as a result of a special mandatory redemption from prepayment of Special Taxes or proceeds of bonds of other community facilities districts.

Notice of Redemption. So long as the Bonds are held in book -entry form, notice of redemption will be sent by the Trustee to DTC and not to the Beneficial Owners of the Bonds under the DTC book -entry only system. Neither the District nor the Trustee is responsible for notifying the Beneficial Owners, who are to be notified in accordance with the procedures in effect for the DTC book -entry system. See Appendix F — "BOOK - ENTRY ONLY SYSTEM."
The Trustee will give notice, in the name and at the expense of the District, of the redemption of Bonds.

Such notice of redemption will: (i) specify the CUSIP numbers (if any), the bond numbers and the maturity date or dates of the Bonds selected for redemption, except that where all of the Bonds are subject to redemption, or all of the Bonds of one maturity are to be redeemed, the bond numbers of such issue need not be specified; (ii) state the date fixed for redemption and surrender of the Bonds to be redeemed; (iii) state the redemption price; (iv) state the place or places where the Bonds are to be redeemed; (v) in the case of Bonds to be redeemed only in part, state the portion of such Bond which is to be redeemed; (vi) state the date of issue of the Bonds as originally issued; (vii) state the rate of interest borne by each Bond being redeemed; and (viii) state any other descriptive information needed to identify accurately the Bonds being redeemed as specified by the Trustee.

Such notice will further state that on the date fixed for redemption, there will become due and payable on each Bond, or portion thereof called for redemption, the principal thereof, together with any premium, and interest accrued to the redemption date, and that from and after such date, interest thereon will cease to accrue and be payable. At least 30 days but no more than 45 days prior to the redemption date, the Trustee will mail a copy of such notice of redemption, by first class mail, postage prepaid, to the respective Owners thereof at their addresses appearing on the Bond Register, and to the original purchaser of any Bonds; provided, however, so long as the Bonds are registered in the name of the Nominee, such notice shall be given in such manner as complies with the requirements of the Depository. The actual receipt by the Owner of any Bond of notice of such redemption is not a condition precedent to redemption, and neither the failure to receive nor any defect in such notice will affect the validity of the proceedings for the redemption of such Bonds, or the cessation of interest on the redemption date. A certificate by the Trustee that notice of such redemption has been given as provided in the Indenture will be conclusive as against all parties and the Owner is not entitled to show that he or she failed to receive notice of such redemption.

In addition to the foregoing notice, further notice will be given by the Trustee as set out below, but no defect in said further notice nor any failure to give all or any portion of such further notice will in any manner defeat the effectiveness of a call for redemption if notice thereof is given as above prescribed. 4861-1693-0704v5/022599-0026
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Each further notice of redemption will be sent not later than the date that notice of redemption is given to the Owners pursuant to the Indenture by first class mail or facsimile to the Depository and to any other registered securities depositories then in the business of holding substantial amounts of obligations of types comprising the Bonds and to one or more of the national information services that are in the business of disseminating notice of redemption of obligations such as the Bonds.

Upon the payment of the redemption price of any Bonds being redeemed, each check or other transfer of funds issued for such purpose will to the extent practicable bear the CUSIP number identifying, by issue and maturity, the Bonds being redeemed with the proceeds of such check or other transfer.

With respect to any notice of optional redemption of Bonds, such notice may state that such redemption is conditional upon the receipt by the Trustee on or prior to the date fixed for such redemption of moneys sufficient to pay the principal of, premium, if any, and interest on such Bonds to be redeemed and that, if the District determines that such moneys will not be so received on or prior to the redemption date, said notice shall be of no force and effect and the Trustee shall not be required to redeem such Bonds. If any condition stated in the redemption notice for an optional redemption shall not have been satisfied on or prior to the redemption date:
(i) the redemption notice shall be of no force and effect, (ii) the District shall not be required to redeem such Bonds, (iii) the redemption shall not be made, and (iv) the Trustee shall within a reasonable time thereafter give notice to the persons in the manner in which the conditional redemption notice was given that such condition or conditions were not met and that the redemption was canceled.

Selection of Bonds for Redemption. If less than all of the Bonds Outstanding are to be redeemed, the portion of any Bond of a denomination of more than $5,000 to be redeemed will be in the principal amount of $5,000 or an integral multiple thereof. In selecting portions of such Bonds for redemption, the Trustee will treat such Bonds, as applicable, as representing that number of Bonds of $5,000 denominations which is obtained by dividing the principal amount of such Bonds to be redeemed in part by $5,000. The procedure for the selection of Parity Bonds for redemption may be modified as set forth in the Supplemental Indenture for such Parity Bonds. The Trustee will promptly notify the District in writing of the Bonds, or portions thereof, selected for redemption.

Partial Redemption of Bonds. Upon surrender of any Bond to be redeemed in part only, the District will execute and the Trustee will authenticate and deliver to the Owner, at the expense of the District, a new Bond or Bonds of authorized denominations equal in aggregate principal amount to the unredeemed portion of the Bonds surrendered, with the same interest rate and the same maturity.

Effect of Notice and Availability of Redemption Money. Notice of redemption having been duly given, as provided in the Indenture, and the amount necessary for the redemption having been made available for that purpose and being available therefor on the date fixed for such redemption: (i) the Bonds, or portions thereof, designated for redemption will, on the date fixed for redemption, become due and payable at the redemption price thereof as provided in the Indenture, anything in the Indenture or in the Bonds to the contrary notwithstanding; (ii) upon presentation and surrender thereof at the designated office of the Trustee, the redemption price of such Bonds will be paid to the Owners thereof; (iii) as of the redemption date the Bonds, or portions thereof so designated for redemption will be deemed to be no longer Outstanding and such Bonds, or portions thereof, will cease to bear further interest; and (iv) as of the date fixed for redemption no Owner of any of the Bonds, or portions thereof so designated for redemption will be entitled to any of the benefits of the Indenture, or to any other rights, except with respect to payment of the redemption price and interest accrued to the redemption date from the amounts so made available.

Registration, Transfer and Exchange
Registration. The Trustee will keep sufficient books for the registration and transfer of the Bonds. The ownership of the Bonds will be established by the Bond registration books held by the Trustee. 13 4861-1693-0704v5/022599-0026

Transfer or Exchange. Subject to the limitations set forth in the following paragraph, the registration of any Bond may, in accordance with its terms, be transferred upon the Bond Register by the person in whose name it is registered, in person or by his or her duly authorized attorney, upon surrender of such Bond for cancellation at the office of the Trustee, accompanied by delivery of written instrument of transfer in a form acceptable to the Trustee and duly executed by the Owner or his or her duly authorized attorney.

Bonds may be exchanged at the office of the Trustee for a like aggregate principal amount of Bonds for other authorized denominations of the same maturity and issue. The Trustee may not collect from the Owner any charge for any new Bond issued upon any exchange or transfer, but will require the Owner requesting such exchange or transfer to pay any tax or other governmental charge required to be paid with respect to such exchange or transfer. Whenever any Bonds are surrendered for registration of transfer or exchange, the District will execute and the Trustee will authenticate and deliver a new Bond or Bonds, as applicable, of the same issue and maturity, for a like aggregate principal amount; provided that the Trustee is not required to register transfers or make exchanges of: (i) Bonds for a period of 15 days next preceding any selection of the Bonds to be redeemed; or (ii) any Bonds chosen for redemption.

SOURCES OF PAYMENT FOR THE BONDS
Limited Obligations
The Bonds are special, limited obligations of the District payable only from amounts pledged under the Indenture and from no other sources.

The Special Taxes are the primary source of security for the repayment of the Bonds. Under the Indenture, the District has pledged to repay the Bonds from the Net Taxes (which are Special Tax revenues remaining after the payment of the annual Administrative Expenses in an amount not to exceed the Administrative Expenses Cap (as defined in the Indenture)) and from amounts held in the Special Tax Fund (other than amounts held in the Administrative Expense Account therein). Special Tax revenues include the proceeds of the annual Special Tax levy received by the District, including any scheduled payments and Prepayments thereof, and the net proceeds of the redemption of delinquent Special Taxes or sale of property sold as a result of foreclosure of the lien of delinquent Special Taxes to the amount of said lien, and penalties and interest thereon; provided that any delinquent Special Tax sold to an independent third -party or to the City for 100% of the delinquent amount will no longer be pledged under the Indenture to the payment of the Bonds or Parity Bonds.

In the event that the Special Tax revenues are not received when due, the only sources of funds available to pay the debt service on the Bonds are amounts held by the Trustee in the Special Tax Fund (other than the Administrative Expense Account therein), including amounts held in the 2024 Bonds Reserve Subaccount of the Reserve Account, to the limited extent described in the Indenture, for the exclusive benefit of the Owners of the Bonds.

NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE CITY, THE COUNTY,

THE STATE OR ANY POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE BONDS. EXCEPT FOR THE NET TAXES, NO OTHER TAXES ARE PLEDGED TO THE PAYMENT OF THE BONDS. THE BONDS ARE NOT GENERAL OR SPECIAL OBLIGATIONS OF THE CITY BUT ARE

LIMITED OBLIGATIONS OF THE DISTRICT PAYABLE SOLELY FROM THE NET TAXES AND OTHER AMOUNTS PLEDGED UNDER THE INDENTURE AS MORE FULLY DESCRIBED HEREIN.

Special Taxes
Authorization and Pledge. In accordance with the provisions of the Act, the City established the District on June 1, 2021 for the purpose of financing the various public improvements and services required in connection with the proposed development within the District. On June 1, 2021, an election was held within the 14 4861-1693-0704v5/022599-0026

District at which the landowners eligible to vote approved the issuance of bonds for the District in an amount not to exceed $19,500,000, secured by special taxes levied on property within the District to finance Facilities (as defined herein). The landowners within the District also voted to approve the Rate and Method which authorized the Special Tax to be levied to repay indebtedness issued for the benefit of the District, including the Bonds. Pursuant to the Rate and Method, the District is authorized to levy a "Special Tax for Public Services," a "Special Tax for Maintenance Services" and a "Special Tax for Maintenance Services (Contingent)." None of the foregoing taxes levied for services or maintenance are pledged to or available to pay debt service on the Bonds or any Parity Bonds. In this Official Statement, all references to the Special Tax shall refer to the amounts available from the Special Tax for Facilities (as defined in the Rate and Method).

The District will covenant in the Indenture that each year it will levy Special Taxes up to the maximum rates permitted under the Rate and Method in an amount sufficient, together with other amounts on deposit in the Special Tax Fund, to pay the principal of and interest on any Outstanding Bonds and Parity Bonds, to replenish the 2024 Bonds Reserve Subaccount to the 2024 Bonds Reserve Requirement and any other Subaccount of the Reserve Account to the applicable Reserve Requirement, and to pay Administrative Expenses.

The Special Taxes are collected in the manner and at the same time as ad valorem property taxes are collected and are subject to the same penalties and the same procedure, sale, and lien priority in case of delinquency as is provided for ad valorem property taxes. See APPENDIX A —"RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX."
The "Net Taxes" pledged by the District to the Bonds (and any Parity Bonds) is defined in the Indenture as the "Gross Taxes" minus amounts permitted to be set aside prior to the payment of the principal of and interest on the Bonds and Parity Bonds in order to pay Administrative Expenses up to the Administrative Expenses Cap.

The Administrative Expenses Cap shall be $30,000 annually. "Gross Taxes" is defined in the Indenture as the amount of all Special Taxes received by the District together with the proceeds collected from the sale of property pursuant to foreclosure for the delinquency of such Special Taxes remaining after the payment of all costs related to such foreclosure actions.

Except for Prepayments, which will be deposited to the Redemption Account of the Special Tax Fund, the Trustee will, on each date on which the Special Taxes are received from the District, deposit the Special Taxes in the Special Tax Fund to be held in trust for the Owners. The Trustee will transfer the Special Taxes on deposit in the Special Tax Fund on the dates, in the amounts and in the following order of priority, to:

First: To the Administrative Expense Account in an amount up to the Administrative Expenses Cap.

Second: To the Interest Account, an amount such that the balance in the Interest Account one Business Day prior to each Interest Payment Date is equal to the installment of interest due on the Bonds and any Parity Bonds on said Interest Payment Date and any installment of interest due on a previous Interest Payment Date which remains unpaid. Moneys in the Interest Account will be used for the payment of interest on the Bonds and any Parity Bonds as the same become due.

Third: To the Principal Account, an amount such that the balance in the Principal Account one Business Day prior to September 1 of each year, commencing September 1, 2024, is equal the principal payment due on the Bonds and any Parity Bonds maturing on such September 1 and any principal payment due on a previous September 1 which remains unpaid. Moneys in the Principal Account shall be used for the payment of the principal of such Bonds and any Parity Bonds as the same become due at maturity. 15 4861-1693-0704v5/022599-0026

Fourth: To the Redemption Account, the amount needed to make the balance in the Redemption Account one Business Day prior to each September 1 on which a Sinking Fund Payment is due equal to the Sinking Fund Payment due on any Outstanding Bonds and Parity Bonds on such September 1; provided, however, that, if amounts in the Special Tax Fund are inadequate to make the foregoing transfers, then any deficiency with respect to the Bonds shall be made up by an immediate transfer from the 2024 Bonds Reserve Subaccount and any deficiency with respect to a series of Parity Bonds shall be made up by an immediate transfer from the Subaccount of the Reserve Account for such series of Parity Bonds, if funded, pursuant to the Indenture; and thereafter, to pay the principal and premium, if any, due in connection with an optional redemption of Bonds or Parity Bonds.

Fifth: To the Subaccounts of the Reserve Account of the Special Tax Fund, on a proportionate basis based on the outstanding principal amount of the Bonds and any Parity Bonds, to the extent necessary to replenish the 2024 Bonds Reserve Subaccount to the 2024 Bonds Reserve Requirement and the Reserve Requirement with respect to Parity Bonds, if any.

Sixth: To the Administrative Expense Account of the Special Tax Fund the amount of any Administrative Expenses for the current Bond Year in excess of the Administrative Expenses Cap as directed by the City.

Seventh: To the Rebate Fund established by the Indenture to the extent directed by the City pursuant to the Indenture.

Eighth: To the Surplus Fund established by the Indenture such remaining amounts in the Special Tax Fund after making the foregoing transfers on September 1.

See APPENDIX D —"SUMMARY OF CERTAIN PROVISIONS OF THE BOND INDENTURE." The Special Taxes levied in any fiscal year may not exceed the maximum rates authorized pursuant to the Rate and Method. See APPENDIX A —"RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX" hereto. There is no assurance that the Special Tax proceeds will, in all circumstances, be adequate to pay the principal of and interest on the Bonds when due. See the caption "—Limitation on Special Tax Levy and Potential Impact on Coverage" below and "SPECIAL RISK FACTORS —Insufficiency of Special Taxes" herein.

Rate and Method ofApportionment ofSpecial Tax. The District is legally authorized and will covenant to cause the levy of the Special Taxes in an amount determined according to a methodology, i.e., the Rate and Method which the City Council and the electors within the District have approved. The Rate and Method apportions the total amount of Special Taxes to be collected among the taxable parcels in the District as more particularly described below. Pursuant to the Rate and Method, the District is authorized to levy a "Special Tax for Public Services," a "Special Tax for Maintenance Services" and a "Special Tax for Maintenance Services (Contingent)." None of the foregoing taxes levied for services or maintenance are pledged to or available to pay debt service on the Bonds or any Parity Bonds. In this Official Statement, all references to the Special Tax shall refer to the amounts available from the Special Tax for Facilities (as defined in the Rate and Method).

The following is a synopsis of the provisions of the Rate and Method for the District, which should be read in conjunction with the complete text of the Rate and Method which is attached to this Official Statement as APPENDIX A —"RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX." The meaning of the defined terms used in this section are as set forth in Appendix A. This section provides only a summary of the Rate and Method, and is qualified by more complete and detailed information contained in the entire Rate and Method attached as Appendix A.
16 4861-1693-0704v5/022599-0026

Maximum Special Tax. The Rate and Method imposes a different Maximum Special Tax for Facilities depending on whether such Developed Property, Final Map Property or Undeveloped Property. The Maximum Special Tax provided for in the Rate and Method is as follows:

Developed Property
The Maximum Special Tax for each Assessor's Parcel of Residential Property that is classified as Developed Property in any Fiscal Year shall be the amount determined by the greater of (i) the application of the Assigned Special Tax set forth in Table 1 below or (ii) the application of the Backup Special Tax.

Table 1 below sets forth the Assigned Special Tax per unit of Developed Property and Final Map Property by Tax Zone, the Fiscal Year 2024-25 projected Special Tax levy and the percent of such levy based on land use class. The District expects to levy the Special Tax only on Developed Property and not on Final Map Property in Fiscal Year 2024-25, however, the District has the ability to levy the Special Tax on Final Map Property under the Rate and Method if necessary to meet the Special Tax Requirement for Facilities.

TABLE 1

CITY OF BEAUMONT
COMMUNITY FACILITIES DISTRICT NO. 2021-1 (FAIRWAY CANYON) ASSIGNED SPECIAL TAX RATES FOR FISCAL YEAR 2024-25
Aggregate
Maximum/Assigned Special Tax Estimated
Special Tax Rates Levy Rates Percent of Special Taxes
Land Use Residential Floor Fiscal Year Fiscal Year Assigned No. of Fiscal Year Percent Class Land Use Type Area (sq. ft.) 2024-250 2024-25 Rate Units 2024-25(2) of Total Zone 1
1 Residential Property 2,800 sq ft 2,345.00 2,127.84 90.7 10 21,278.40 2.3 8 Final Map Property N/A 18,347.00 0.00 0.0 2 0.00 0.0
Zone 2
1 Residential Property 2,800 sq ft 2,145.00 1,946.36 90.7 32 62,283.54 6.6 8 Final Map Property N/A 16,210.00 0.00 0.0 7 0.00 0.0
Zone 3
1 Residential Property 2,400 sq ft 2,380.00 2,159.60 90.7 18 38,872.77 4.1 Zone 4
1 Residential Property 2,400 sq ft 2,180.00 1,978.12 90.7 17 33,628.03 3.6 Total 529 $ 938,962.50 100.0%
(o
(2)
Reflects the Assigned Special Tax rates for Developed Property and Final Map Property. The Assigned Special Tax rates for Final Map Property in Zones 3 and 4 are not shown because there is no longer any Final Map Property in such Zones.

Includes estimated Administrative Expenses of $30,000.
4861-1693-0704v5/022599-0026
17

Final Map Property and Undeveloped Property
The Maximum Special Tax for each Assessor's Parcel classified as Undeveloped Property and Final Map Property in any Fiscal Year shall be the Assigned Special Tax for such property. The Assigned Special Tax for Final Map Property for any Fiscal Year shall be $18,347 and $16,210 for Tax Zones 1 and 2, respectively.

As of November 1, 2023, assuming no additional building permits are issued, there will be nine parcels classified as Final Map Property in Tax Zones 1 and 2 in Fiscal Year 2024-25. There is no longer any Undeveloped Property in the District and there is no longer any Final Map Property in Tax Zones 3 and 4.

Backup Special Tax. Each Assessor's Parcel of Developed Property classified as Residential Property shall be subject to a Backup Special Tax. When a Final Map is recorded, the CFD Administrator shall determine which Zone the Final Map area lies within and the Backup Special Tax for a Parcel classified or to be classified as Residential Property within such Final Map shall be determined by multiplying the Undeveloped Property Maximum Special Tax rate per Acre for the applicable Zone by the total Acreage of Taxable Property within such Final Map, excluding the Acreage associated with Non -Residential Property, Public Property and/or Property Owners' Association Property that is not Exempt Property pursuant to the Rate and Method and dividing such amount by the number of Parcels within such Final Map classified as either (i) Developed Property or (ii) Final Map Property for which a Building Permit is expected to be issued for Residential Property (i.e., the number of residential lots).

Notwithstanding the forgoing, if Parcels classified or to be classified as Residential Property are subsequently changed or modified by recordation of a lot line adjustment or similar instrument, then the Backup Special Tax shall be recalculated for the area that has been changed or modified using the methodology described in the preceding paragraph.

The Backup Special Tax shall not apply to Non -Residential Property, Public Property, or Property Owners' Association Property.

Method of Apportionment of Special Tax. Pursuant to the Rate and Method the District is required to determine the "Special Tax Requirement for Facilities" for each Fiscal Year. The Special Tax Requirement for Facilities means the amount required in any Fiscal Year to pay: (i) the debt service or the periodic costs on all outstanding Bonds and Parity Bonds due in the Calendar Year that commences in such Fiscal Year, (ii) Administrative Expenses, (iii) the costs associated with the release of funds from an escrow account, (iv) any amount required to establish or replenish any reserve funds established in association with the Bonds and any Parity Bonds, (v) the collection or accumulation of funds for the acquisition or construction of facilities authorized by the District provided that the inclusion of such amount does not cause an increase in the levy of Special Tax for Facilities on Final Map Property or Undeveloped Property, less (vi) any amounts available to pay debt service or other periodic costs on the Bonds and any Parity Bonds pursuant to the Indenture.

For each Fiscal Year until terminated, the City Council will levy Special Taxes on all Taxable Property until the amount of Special Tax levied equals the Special Tax Requirement for Facilities in accordance with the following steps:

First: The Special Tax shall be levied Proportionately on each Assessor's Parcel of Developed Property at up to 100% of the applicable Assigned Special Tax rates as needed to satisfy the Special Tax Requirement for Facilities;
Second: If additional moneys are needed to satisfy the Special Tax Requirement for Facilities after the first step has been completed, the Special Tax shall be levied Proportionately on each Assessor's Parcel of Final Map Property, at up to 100% of the Assigned Special Tax applicable to each such Assessor's Parcel as needed to satisfy the Special Tax Requirement for Facilities; 18 4861-1693-0704v5/022599-0026

Third: If additional moneys are needed to satisfy the Special Tax Requirement for Facilities after the first two steps have been completed, the Annual Special Tax shall be levied Proportionately on each Assessor's Parcel of Undeveloped Property, excluding any Undeveloped Property exempt from the Special Tax pursuant to Section J of the Rate and Method, at up to 100% of the Assigned Special Tax applicable to each such Assessor's Parcel as needed to satisfy the Special Tax Requirement for Facilities (there is no longer any Undeveloped Property in the District); Fourth: If additional moneys are needed to satisfy the Special Tax Requirement for Facilities after the first three steps have been completed, then for each Assessor's Parcel of Developed Property whose Maximum Special Tax is the Backup Special Tax shall be increased Proportionately from the Assigned Special Tax up to 100% of the Backup Special Tax as needed to satisfy the Special Tax Requirement for Facilities; and
Fifth: If additional moneys are needed to satisfy the Special Tax Requirement for Facilities after the first four steps have been completed, the Special Tax shall be levied Proportionately on each Assessor's Parcel of Property Owner's Association Property and Public Property, found not to be exempt pursuant to Section K of the Rate and Method, at up to 100% of the Maximum Special Tax applicable to each such Assessor's Parcel as needed to satisfy the Special Tax Requirement for Facilities.

Prepayment of Special Taxes. The Special Tax obligation of an Assessor's Parcel of Developed Property, an Assessor's Parcel of Final Map Property or Undeveloped Property, may be prepaid in full, provided that there are no delinquent Special Taxes, penalties, or interest charges outstanding with respect to such Assessor's Parcel at the time that the Special Tax obligation would be prepaid. In addition, the Special Tax obligation of an Assessor's Parcel of Developed Property, an Assessor's Parcel of Final Map Property or Undeveloped Property for which a building permit has been issued and will be classified as Developed Property in the next Fiscal Year may be prepaid in part.

The Prepayment Amount is calculated based on the Bond Redemption Amount, the Redemption Premium, the Future Facilities Amount, the Defeasance amount, the Administrative Fees, and less a credit for the resulting reduction in the Reserve Requirement for the Bonds (if any), all as specified in APPENDIX A — "RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX —Section H." No parcel within the District has prepaid its Special Tax obligation; accordingly, all parcels will be subject to the Special Tax levy going forward, subject to future Special Tax prepayments, if any.

Exempt Property. The City shall classify as Exempt Property (i) Assessor's Parcels defined as Public Property, (ii) Assessor's Parcels which are used as places of worship and are exempt from ad valorem property taxes because they are owned by a religious organization, (iii) Assessor's Parcels used exclusively by a Property Owner's Association, or (iv) Assessor's Parcels with public or utility easements making impractical their utilization for other than the purposes set forth in the easement. Notwithstanding the above, the City Council shall not classify an Assessor's Parcel as Exempt Property within a Zone if such classification would reduce the sum of the Taxable Property to less than the Minimum Acreage for that Zone, as defined in the Rate and Method.

Assessor's Parcels which cannot be classified as Exempt Property because such classification would reduce the Acreage of the Taxable Property to less than the Minimum Acreage per Zone will continue to be classified as Taxable Property, and will continue to be subject to Special Taxes accordingly.

Tax-exempt status will be assigned by the CFD Administrator in chronological order. If an Assessor's Parcel's classification is changed after the initial status is assigned, then its tax-exempt status will be revoked.

Estimated Debt Service Coverage. Based on development status as of November 1, 2023, 520 parcels within the District will be classified as Developed Property for the Fiscal Year 2024-25 Special Tax levy. Debt service for the Bond Year ending September 1, 2024 has been sized assuming that the Special Taxes are levied only on the 520 parcels with building permits issued as of November 1, 2024. Annual Debt Service for the Bonds in each Fiscal Year thereafter has been structured so that Assigned Special Taxes levied on all taxable 19 4861-1693-0704v5/022599-0026

parcels of Developed Property at buildout (529 parcels), assuming no delinquencies, will generate in each Fiscal Year not less than 110% of debt service payable with respect to the Bonds in the calendar year that begins in that Fiscal Year, plus estimated Administrative Expenses, assuming that Special Taxes are levied and collected on such Developed Property in the District pursuant to the Rate and Method at the Assigned Special Tax rate.

Neither the Assigned Special Tax nor the Administrative Expenses escalate over time.

Limitation on Special Tax Levy and Potential Impact on Coverage. Pursuant to Section 53321(d) of the Government Code, the Special Tax levied against any Assessor's parcel for which an occupancy permit for private residential use has been issued shall not be increased as a consequence of delinquency or default by the owner of any other Assessor's parcel within the District by more than 10% above the amount that would have been levied in that fiscal year had there never been any such delinquencies or defaults. As a result, it is possible that the District may not be able to increase the tax levy to the Assigned Special Tax in all years. In addition, under the Rate and Method, in no event shall the Special Tax be levied after Fiscal Year 2061-62.

Collection of Special Taxes. The Special Taxes are levied and collected by the Treasurer -Tax Collector of the County in the same manner and at the same time as ad valorem property taxes. The District may, however, collect the Special Taxes at a different time or in a different manner if necessary to meet its financial obligations.

The County assesses and collects secured and unsecured property taxes for the cities, school districts, and special districts within the County, including the Special Taxes for the District. The delinquency dates for property tax payments are December 10 for the first installment and April 10 for the second installment. Once the property taxes are collected, the County conducts its internal reconciliation for accounting purposes and distributes the City's share of such taxes (including the Special Taxes) to the City, periodically and typically pursuant to a published schedule. Prior to distribution, the moneys are deposited in an account established on behalf of the County in the Riverside County Investment Pool (the "Pool") which is invested by the County Treasurer -Tax Collector. If the County or the Pool were at any time to become subject to bankruptcy proceedings, it is possible that District property taxes held in the Pool (including the Special Taxes), if any, could be temporarily unavailable to the County. The District does not participate in the County's Teeter Plan, which is an alternate method for allocating property taxes by counties. Accordingly, the collection of Special Taxes is subject to delinquencies.

The Special Tax was first levied in Fiscal Year 2022-23. See Table 7 herein under the caption "THE COMMUNITY FACILITIES DISTRICT —Delinquency History" for more information related to the Fiscal Years 2022-23 and 2023-24 Special Tax levies. No assurances can be made that Special Taxes will be collected in an amount required to make debt service payments on the Bonds. See "THE COMMUNITY FACILITIES DISTRICT —Delinquency History" and "SPECIAL RISK FACTORS —Special Tax Delinquencies" and "SPECIAL RISK FACTORS —Insufficiency of Special Taxes." The District will make certain covenants in the Indenture for the purpose of ensuring that the current maximum Special Tax rates and method of collection of the Special Taxes are not altered in a manner that would impair the District's ability to collect sufficient Special Taxes to pay debt service on the Bonds and Administrative Expenses when due.

First, the District will covenant in the Indenture that it will take no actions that would discontinue or cause the discontinuance of the Special Tax levy or the District's authority to levy the Special Tax for so long as the Bonds and any Parity Bonds are Outstanding.

Second, the District will covenant in the Indenture, to the maximum extent that the law permits it to do so, not to initiate proceedings to reduce the maximum Special Tax rates for the District, unless, in connection therewith, the District receives a certificate from one or more Independent Financial Consultants which, when taken together, certify that: (i) such changes do not reduce the maximum Special Taxes that may be levied in each year on property within the District to an amount which is less than the Administrative Expense Cap plus 110% of the Annual Debt Service due in each corresponding future Bond Year with respect to the Bonds and 20 4861-1693-0704v5/022599-0026

Parity Bonds Outstanding as of the date of such proposed reduction; and (ii) the District is not delinquent in the payment of the principal of or interest on the Bonds or any Parity Bonds.

Third, the District will covenant in the Indenture that, in the event that any initiative is adopted by the qualified electors within the District which purports to reduce the maximum Special Tax below the levels specified in the preceding paragraph or to limit the power of the District to levy the Special Taxes for the purposes set forth in the Indenture, it will commence and pursue legal action in order to preserve its ability to comply with such covenants. The District can provide no assurance that any such legal action will be successful. See the caption "SPECIAL RISK FACTORS — Proposition 218."
Fourth, the District will covenant in the Indenture that it will not adopt any policy pursuant to the Act permitting the tender of Bonds or Parity Bonds in full payment or partial payment of any Special Taxes unless the District has first received a certificate from an Independent Financial Consultant that the acceptance of such a tender will not result in the District having insufficient Net Taxes to pay the principal of and interest on the Bonds and Parity Bonds when due.

Although the Special Taxes constitute liens on taxed parcels within the District, they do not constitute a personal indebtedness of the owners of property within the District. Moreover, other liens for taxes and assessments already exist on the property located within the District and others could come into existence in the future in certain situations without the consent or knowledge of the City or the landowners in the District. See the captions "THE COMMUNITY FACILITIES DISTRICT — Direct and Overlapping Debt" and "SPECIAL RISK FACTORS — Direct and Overlapping Indebtedness." There is no assurance that property owners will be financially able to pay the annual Special Taxes or that they will pay such taxes even if financially able to do so, all as more fully described under the caption "SPECIAL RISK FACTORS." Proceeds of Foreclosure Sales. The net proceeds received following a judicial foreclosure sale of property within the District resulting from a property owner's failure to pay the Special Taxes when due are included within the Net Taxes pledged to the payment of principal of and interest on the Bonds and any Parity Bonds under the Indenture.

Pursuant to Section 53356.1 of the Act, in the event of any delinquency in the payment of any Special Tax or receipt by the District of Special Taxes in an amount which is less than the Special Taxes levied, the City Council, as the legislative body of the District, may order that Special Taxes be collected by a Superior Court action to foreclose the lien within specified time limits. In such an action, the real property subject to the unpaid amount may be sold at a judicial foreclosure sale. Under the Act, the commencement of judicial foreclosure following the nonpayment of a Special Tax is not mandatory. However, the District will covenant in the Indenture for the benefit of the owners of the Bonds and any Parity Bonds that it will: (i) commence judicial foreclosure proceedings against parcels with delinquent Special Taxes in excess of $2,500 by the December 1 following the close of each Fiscal Year in which such Special Taxes were due; and (ii) commence judicial foreclosure proceedings against all parcels with delinquent Special Taxes by the December 1 following the close of each Fiscal Year in which it receives Special Taxes in an amount which is less than 95% of the total Special Tax levied; and (iii) diligently pursue such foreclosure proceedings until the delinquent Special Taxes are paid; provided that, notwithstanding the foregoing, the District may elect to defer foreclosure proceedings on any parcel so long as the amount in the 2024 Bonds Reserve Subaccount is at least equal to the 2024 Bonds Reserve Requirement and the amounts in all other Subaccounts of the Reserve Account is at least equal to the applicable Reserve Requirement.

The District will covenant in the Indenture that it will deposit the net proceeds of any foreclosure in the Special Tax Fund and will apply such proceeds remaining after the payment of Administrative Expenses to make current payments of principal and interest on the Bonds and any Parity Bonds, to bring the amount on deposit in the 2024 Bonds Reserve Subaccount up to the 2024 Bonds Reserve Requirement and the amount on deposit in any other Subaccount of the Reserve Account up to the applicable Reserve Requirement, and to pay any 21 4861-1693-0704v5/022599-0026

delinquent installments of principal or interest due on the Bonds and any Parity Bonds. See APPENDIX D — "SUMMARY OF THE INDENTURE —COVENANTS AND WARRANTY —Covenants" herein.

If foreclosure is necessary and other funds (including amounts in the 2024 Bonds Reserve Subaccount) have been exhausted, debt service payments on the Bonds could be delayed unless the foreclosure proceedings produce sufficient net foreclosure sale proceeds. Judicial foreclosure actions are subject to the normal delays associated with court cases and may be further slowed by bankruptcy actions, involvement by agencies of the federal government and other factors beyond the control of the City and the District. See the caption "SPECIAL RISK FACTORS —Enforcement Delays — Bankruptcy." Moreover, no assurances can be given that the real property subject to foreclosure and sale at a judicial foreclosure sale will be sold or, if sold, that the net proceeds of such sale will be sufficient to pay any delinquent Special Tax installment. See the caption "SPECIAL RISK FACTORS —Property Values." Although the Act authorizes the District to cause such an action to be commenced and diligently pursued to completion, the Act does not impose on the District or the City any obligation to purchase or acquire any lot or parcel of property sold at a foreclosure sale if there is no other purchaser at such sale. The Act provides that, in the case of a delinquency, the Special Tax will have the same lien priority as is provided for ad valorem taxes.

No Teeter Plan
Although the Riverside County Board of Supervisors has adopted the Alternative Method of Distribution of Tax Levies and Collections and of Tax Sale Proceeds (the "Teeter Plan") which allows each entity levying secured property taxes in the County to draw on the amount of property taxes levied rather than the amount actually collected, as provided for in Section 4701 et seq. of the California Revenue and Taxation Code, the District is not included in the County Teeter Plan. Consequently, the District may not draw on the County Tax Loss Reserve Fund in the event of delinquencies in Special Tax payments within the District. 2024 Bonds Reserve Subaccount of the Reserve Account of the Special Tax Fund In order to secure further the payment of principal of and interest on the Bonds, the District is required, upon delivery of the Bonds, to deposit in the 2024 Bonds Reserve Subaccount and thereafter to maintain in the 2024 Bonds Reserve Subaccount an amount equal to the 2024 Bonds Reserve Requirement. The term "2024 Bonds Reserve Requirement" is defined in the Indenture to mean, that amount as of any date of calculation, equal to the lesser of: (i) 10% of the initial principal amount of the Bonds; (ii) Maximum Annual Debt Service on the then Outstanding Bonds; (iii) 125% of average Annual Debt Service on the then Outstanding Bonds; provided, however, that the 2024 Bonds Reserve Subaccount shall not exceed $ . The Reserve Requirement may be satisfied in whole or in part by cash, a Reserve Policy (as defined in the Indenture), or a combination thereof. On the date of issuance of the Bonds, the District will deposit $ from proceeds of the Bonds into the 2024 Bonds Reserve Subaccount to satisfy the 2024 Bonds Reserve Requirement.

The 2024 Bonds Reserve Subaccount only secures and the amounts therein are only available to pay the principal of, redemption premium, if any, and interest on the Bonds. In connection with the issuance of a series of Parity Bonds, if any, the District may establish an additional Subaccount within the Reserve Account which secures such series of Parity Bonds. Such additional Subaccounts within the Reserve Account established for Parity Bonds will not secure the Bonds.

Subject to the limits on the maximum annual Special Tax levy set forth in the Rate and Method and in the Indenture, the District will covenant in the Indenture to levy Special Taxes in an amount sufficient, in light of the other intended uses of the Special Tax proceeds, to maintain the balance in the 2024 Bonds Reserve Subaccount at the 2024 Bonds Reserve Requirement and any other Subaccount of the Reserve Account at the applicable Reserve Requirement. Amounts in the 2024 Bonds Reserve Subaccount are to be applied: (i) to pay debt service on the Bonds, including Sinking Fund Payments, to the extent that other monies are not available therefor; (ii) to redeem Bonds in the event of prepayment of Special Taxes, to optionally redeem Bonds or in connection with a partial defeasance of Bonds, in accordance with the Indenture; and (iii) to pay any rebate 22 4861-1693-0704v5/022599-0026

requirements with respect to the Bonds. See Appendix D under the caption "CREATION OF FUNDS AND APPLICATION OF PROCEEDS —Reserve Account of the Special Tax Fund.

Surplus Fund
After the transfer of Administrative Expenses to the Administrative Expense Fund up to the Administrative Expenses Cap, the payment of principal of and interest on the Bonds and any Parity Bonds when due, transfers to the Redemption Account to pay principal and premium, if any, on Bonds and any Parity Bonds called for redemption, transfers to replenish the subaccounts of the Reserve Account to the applicable Reserve Requirement and any required transfers to the Rebate Fund, as soon as practicable after each September 1, the Trustee shall transfer all remaining amounts in the Special Tax Fund to the Surplus Fund, unless on or prior to such date, it has received a Certificate of an Authorized Representative directing that certain amounts be retained in the Special Tax Fund because the District has included such amounts as being available in the Special Tax Fund in calculating the amount of the levy of Special Taxes for such Fiscal Year. Moneys deposited in the Surplus Fund may be transferred: (i) to the Interest Account, the Principal Account or the Redemption Account of the Special Tax Fund to pay the principal of, including Sinking Fund Payments, premium, if any, and interest on the Bonds and any Parity Bonds when due in the event that moneys in the Special Tax Fund and the Subaccounts of the Reserve Account of the Special Tax Fund are insufficient therefor; (ii) to each Subaccount of the Reserve Account, on a proportionate basis based on the outstanding principal amount of the Bonds and any Parity Bonds, to replenish the 2024 Bonds Reserve Subaccount to the 2024 Bonds Reserve Requirement, and to each other Subaccount of the Reserve Account to the applicable Reserve Requirement; (iii) to the Administrative Expense Account of the Special Tax Fund to pay Administrative Expenses to the extent that the amounts on deposit in the Administrative Expense Account of the Special Tax Fund are insufficient to pay Administrative Expenses; (iv) to the Acquisition and Construction Fund to pay Project Costs; or (v) after all Project Costs have been paid, to the District, for any other lawful purpose of the District.

The amounts in the Surplus Fund are not pledged to the repayment of the Bonds or any Parity Bonds and may be used by the District for any lawful purpose.

Issuance of Parity Bonds for Refunding Purposes Only
The District may at any time after the issuance and delivery of the Bonds under the Indenture issue Parity Bonds payable from the Net Taxes and other amounts deposited in the Special Tax Fund (other than in the Administrative Expense Account therein) and secured by a lien and charge upon such amounts equal to the lien and charge securing the Outstanding Bonds and any other Parity Bonds theretofore issued under the Indenture or under any Supplemental Indenture; provided, however, that Parity Bonds may only be issued for the purpose of refunding all or a portion of the Bonds or any Parity Bonds then Outstanding. Parity Bonds may be issued subject to additional specific conditions, which are made conditions precedent to the issuance of any such Parity Bonds by the Indenture. See Appendix D under the caption "DEFEASANCE AND PARITY BONDS."

THE COMMUNITY FACILITIES DISTRICT
General
The District is located in the northwestern portion of the City and is located to the west of the Interstate 10 freeway, east of Tukwet Canyon Parkway and north of Oak Valley Parkway. The Developer has sold all of the property planned for residential development within the District to three merchant builders: Woodside, D.R.

Horton and Richmond American.

The District is part of the master -planned community in the City known as "Fairway Canyon." At buildout, Fairway Canyon is expected to consist of approximately 3,300 residential units on approximately 1,556 acres of land, with 46.4 acres of commercial/industrial land uses and the balance set aside for public/quasi/public 23 4861-1693-0704v5/022599-0026

uses. As of November 1, 2023, the Developer estimates that approximately 2,350 homes within Fairway Canyon have been completed and sold to individual homeowners.

Status of Development in the District
As of November 1, 2023, individual homeowners owned 419 homes (with another 34 homes in escrow to be conveyed to individual homeowners). As of such date, Woodside, D.R. Horton and Richmond American owned 40, 23 and 47 lots, respectively, in the District in various stages of construction. The backbone infrastructure necessary to complete the development in the District have been completed and the in -tract infrastructure has been substantially completed. The merchant builders within the District expect to complete the remaining in -tract infrastructure for their respective projects commensurate with the timing for completion of the remaining planned homes. See "PROPERTY OWNERSHIP AND THE DEVELOPMENT" below.

Description of Authorized Facilities
Certain facilities are authorized to be constructed and acquired (the "Facilities") by the District. These Facilities include, but are not limited to the following:
• Sewer system improvements
• Storm drain improvements
• Dry utilities infrastructure
• Street improvements
• Park Improvements
The Developer has completed, or has caused to be completed, all of the Facilities that are to be financed in part with the proceeds of the Bonds. The total cost of the Facilities was approximately $21,200,000, and the District estimates that approximately $12,600,000* will be paid to the Developer from the proceeds of the Bonds.

Property Values and the Appraisal
General. The extent to which the Special Tax provides security for the Bonds is, at least in part, a function of the value of each parcel of land within the District that is subject to the Special Tax because, in the event that a property owner defaults in the payment of the applicable Special Tax, such property owner will not have any personal liability for the payment of the Special Tax, and the principal remedy available to the District will be to take foreclosure proceedings with respect to the subject property.

Assessed Value. The assessed value of the property within the District represents the secured assessed valuation established by the County Assessor. Assessed values do not necessarily represent market values.

Article XIIIA of the California Constitution (Proposition 13) defines "full cash value" to mean "the County assessor's valuation of real property as shown on the 1975/76 roll under 'full cash value', or, thereafter, the appraised value of real property when purchased or newly constructed or when a change in ownership has occurred after the 1975 assessment," subject to exemptions in certain circumstances of property transfer or reconstruction. The "full cash value" is subject to annual adjustment to reflect increases, not to exceed 2% for any year, or decreases in the consumer price index or comparable local data, or to reflect reductions in property value caused by damage, destruction or other factors. Because of the general limitation to 2% per year in increases in full cash value of properties which remain in the same ownership, the County tax roll does not reflect values uniformly proportional to actual market values. There can be no assurance that the assessed valuations of the properties within the District accurately reflect their respective market values, and the future fair market values of those properties may be lower than their current assessed valuations. The Fiscal Year 2023-24 assessed value of the property in the District is $187,128,787.

Preliminary, subject to change.
24 4861-1693-0704v5/022599-0026

Appraised Value. As a result of the requirements of Article XIIIA of the California Constitution, a property's assessed value is not necessarily indicative of its market value. In order to provide information with respect to the value of the property within the District, the City engaged Integra Realty Resources, the Appraiser, to prepare the Appraisal Report. The Appraiser has an "MAI" designation from the Appraisal Institute and has prepared numerous appraisals for the sale of land -secured municipal bonds. The Appraiser has no material relationships with the City, the District, the Developer or the owners of the land within the District other than the relationship represented by the engagement to prepare the Appraisal Report. The City instructed the Appraiser to prepare its analysis and report in conformity with City -approved guidelines and the Appraisal Standards for Land Secured Financings published in 1994 and revised in 2004 by the California Debt and Investment Advisory Commission. A copy of the Appraisal Report is included as APPENDIX H — "APPRAISAL REPORT" to this Official Statement.

The purpose of the Appraisal Report was to estimate the market value of the property within the District subject to the lien of the Special Taxes. With respect to 291 completed single family homes owned by individual homeowners and five completed model homes owned by the merchant builders, as shown on the County Assessor's roll as of January 1, 2023, the Appraiser used the Fiscal Year 2023-24 assessed values assigned by the County (totaling $156,323,396). In valuing the Appraised Property relating to the remaining 233 planned homes in the District, the Appraiser used a sales comparison approach for the completed single family homes and a land residual analysis for the remaining property to derive a value indication for the finalized lots within each tract adjusted by any costs to complete such finished lots.

Subject to the assumptions and limiting conditions set forth in the Appraisal Report, the Appraiser concluded that, as of the Date of Value (November 1, 2023), the estimated market value of the property within the District subject to the lien of the Special Taxes was $240,762,396, consisting of $156,323,396 of the 296 homes with improvement value shown on the Fiscal Year 2023-24 County Assessor's roll, and $84,530,000 of the appraised value of the Appraised Property relating to the remaining 233 homes. The estimate of market value takes into consideration and assumes the improvements to be funded with the proceeds of the Bonds have been installed.

Reference is made to Appendix H for a complete list of the assumptions and limiting conditions and a full discussion of the appraisal methodology and the basis for the Appraiser's opinions. In the event that any of the contingencies, assumptions and limiting conditions are not actually realized, the value of the property within the District may be less than the amount reported in the Appraisal Report. In any case, there can be no assurance that any portion of the property within the District would actually sell for the amount indicated by the Appraisal Report.

The Appraisal Report merely indicates the Appraiser's opinion as to the market value of the property referred to therein as of the date and under the conditions specified therein. The Appraiser's opinion reflects conditions prevailing in the applicable market as of the date of the Appraisal Report. The Appraiser's opinion does not predict the future value of the subject property, and there can be no assurance that market conditions will not change adversely in the future. See, for example, "SPECIAL RISK FACTORS —Impact of Economic Conditions on the Development in the District."
It is a condition precedent to the issuance of the Bonds that the Appraiser deliver to the District a certification to the effect that, while the Appraiser has not updated the Appraisal Report since its date and has not undertaken any obligation to do so, nothing has come to the attention of the Appraiser subsequent to the date of the Appraisal Report that would cause the Appraiser to believe that the value of the property that it appraised in the District is less than the value reported in the Appraisal Report. However, the Appraiser notes that acts and events may have occurred since the date of the Appraisal Report which could result in both positive and negative effects on market value within the District.
25 4861-1693-0704v5/022599-0026

Value -to -Lien Ratios
Table 2 below incorporates the values assigned to parcels in the Appraisal Report, the estimated principal amount of the Bonds allocable to each category of parcels and the estimated assessed/appraised value - to -lien ratios for various categories of parcels based upon land values as of November 1, 2023, as set forth in the Appraisal Report. Based on the principal amount of the Bonds, the estimated assessed/appraised District -wide value -to -lien ratio including all Taxable Property as of April 10, 2023 is 16.97 -to -1 *. This ratio does not include other direct and overlapping debt within the District. See "—Direct and Overlapping Indebtedness" below.

Taking that direct and overlapping debt into account, the ratio of the aggregate assessed/appraised value of the Taxable Property within the District to the total principal amount of all direct and overlapping bonded debt for the District is approximately 13.45 -to -1*. The District expects to levy the Special Tax only on Developed Property and not on Final Map Property in Fiscal Year 2024-25, however, the District has the ability to levy the Special Tax on Final Map Property under the Rate and Method if necessary to meet the Special Tax Requirement for Facilities. The estimated appraised/assessed District -wide value -to -lien ratio of Developed Property as of November 1, 2023 is 16.82 -to -1*. This ratio does not include other direct and overlapping debt within the District. See "—Direct and Overlapping Indebtedness" below. Taking that direct and overlapping debt into account, the ratio of the aggregate assessed/appraised value of Developed Property within the District to the total principal amount of all direct and overlapping bonded debt for the District is approximately 13.33 -to -1 *.

Table 3 below summarizes the assessed/appraised value -to -lien of the Developed Property within the District by value -to -lien ranges based on development status as of November 1, 2023. [Remainder of Page Intentionally Left Blank]
Preliminary, subject to change.
26 4861-1693-0704v5/022599-0026

TABLE 2

CITY OF BEAUMONT
COMMUNITY FACILITIES DISTRICT NO. 2021-1 (FAIRWAY CANYON)

ASSESSED/APPRAISED VALUE -TO -LIEN RATIOS

ALLOCATED BY PROPERTY OWNER
Property Owner°
Developed Property
Individually Owned
DR Horton
Woodside
Richmond American
Total Developed Property
Final Map Property
Richmond American
Total Final Map Property
Total
(4)
(5)
(6)
of
Appraised/
No. of Appraised/Assessed Assessed
Parcels Property Value° Value
419 $ $213,136,101
23 5,920,880
40 10,123,936
38 9,475,479
520 $ 238,656,396
9 9 $ 2,106,000
$ 2,106,000
529
$ 240,762,396
% of
Fiscal Year Estimated
Fiscal Year 2024-25 Projected Fiscal
2024-25 Percentage Fiscal Year Year
Maximum of 2024-25 2024-25
Special Maximum Special Tax Special
Tax(3) Tax Levy (4) Tax Levy

88.53% $ 917,123 78.86% $ 756,603 80.58%

2.46 52,761 4.54 42,430 4.52

4.20 78,400 6.74 67,692 7.21

3.94 93,538 8.04 72,238 7.69

99.13% $ 1,141,822 98.18% $ 938,963 100.00%

0.87%

0.87%
$ 21,164 1.82% $ 0 0.00%
$ 21,164 1.82% $ 0 0.00%
100.00% $ 1,162,986 100.00% $ 938,963 100.00%
CFD 2021-1
2024 Bonds(s)*
All other
Overlapping
Debt Issued')
$ 11,434,113 $2,989,269
641,216 167,636
1,022,984 267,443
1,091,686 285,404
$ 14,190,000 $3,709,752
$ 0 $
$ 0 $
Appraised
Value -to -
Lien Ratio*

14.78:1

7.32:1

7.85:1

6.88:1

13.33:1
0 N/A
0 N/A
$ 14,190,000 $3,709,752 13.45:1
Preliminary, subject to change.

Property ownership status as of November 1, 2023. See "PROPERTY OWNERSHIP AND THE DEVELOPMENT" below.

Based on the aggregate assessed/appraised value set forth in the Appraisal Report as of November 1, 2023, the Date of Value.

Based on the Backup Special Tax rate on Developed Property and the Maximum Special Tax Rate on Final Map Property. See "SOURCES OF PAYMENT FOR THE BONDS — Special Taxes — Rate and Method of Apportionment of Special Tax." Estimated Fiscal Year 2024-25 Special Tax Levy based upon development status as of November 1, 2023 and an Administrative Expense Cap of $30,000. The estimated levy on Developed Property shown is equal to 91.1% of the Assigned Special Tax rates on Developed Property. See "SOURCES OF PAYMENT FOR THE BONDS — Special Taxes — Rate and Method of Apportionment of Special Tax."
Allocated based on the estimated Fiscal Year 2024-25 Special Tax levy.

Includes overlapping debt set forth in Table 4 below.

Source: County of Riverside Assessor's Office; Spicer Consulting Group, LLC. 4861-1693-0704v5/022599-0026
27

TABLE 3

CITY OF BEAUMONT
COMMUNITY FACILITIES DISTRICT NO. 2021-1 (FAIRWAY CANYON) ASSESSED/APPRAISED VALUE -TO -LIEN STRATIFICATION FOR PARCELS OF DEVELOPED PROPERTY* Value -to -Lien Category
Less than 5.00:1(4)
Between 5.01:1 to 10.00:1
Between 10.01:1 to 15.00:1
Greater than 15.00:1(4)
Totals
(1)
(2)
(3)
(4)
Percent
CFD 2021-1 Share of
Projected Projected
No. of Fiscal Year Fiscal Year
Parcels of % of % of 2024-25 2024-25
Developed Developed Appraised Appraised Special Tax Special Tax CFD 2021-1 Property Property Value' Value Levy Levy 2024 Bonds°
0 0.00% $ 0 0.00% $ 0 0.00% $ 0
91 17.50 20,954,000 8.78 164,297 17.50 2,482,931
219 42.12 104,856,460 43.94 411,989 43.88 6,226,149
210 40.38 112,845,936 47.28 362,676 38.63 5,480,920
520 100.00% $ 238,656,396 100.00% $ 938,962 100.00% $ 14,190,000 Percent
Share of
2024 Bonds

0.00%

17.50 43.88

38.63 100.00%
Preliminary, subject to change.

Based on the aggregate assessed/appraised value of Developed Property set forth in the Appraisal Report as of November 1, 2023, the Date of Value.

Allocated based on the estimated Fiscal Year 2024-25 Special Tax levy based upon development status as of November 1, 2023.

Includes overlapping debt set forth in Table 4 below.

The minimum value to lien of Developed Property in the District is 5.61:1*. The maximum value to lien in the Greater than 15.00:1 category is 19.59:1*.

Source: County of Riverside Assessor's Office; Spicer Consulting Group, LLC. 4861-1693-0704v5/022599-0026
28 All Other
Overlapping Aggregate
Debt(3) Value -to -Lien
$ 0 N/A
649,123 6.69:1
1,627,728 13.35:1
1,432,900 16.32:1
$ 3,709,752 13.33:1

Authorized but Unissued Direct and
Overlapping Indebtedness
Beaumont Unified School District
San Gorgonio Pass Mem Hospital
Mt San Jacinto Jr College
TOTAL UNISSUED GENERAL OBLIGATION INDEBTEDNESS")

TOTAL OUTSTANDING AND UNISSUED GENERAL OBLIGATION INDEBTEDNESS Direct and Overlapping Debt
The District is included within the boundaries of overlapping local agencies providing governmental services. Some of these local agencies have outstanding bonds, and/or the authority to issue bonds, payable from taxes or assessments. The existing and authorized indebtedness payable from taxes and assessments that may be levied upon the property within the District is shown in Table 4 below. In addition to current debt, new community facilities districts and/or special assessment districts could be formed in the future encompassing all or a portion of the property within the District; and such districts or the agencies that formed them could issue more bonds and levy additional special taxes or assessments.

TABLE 4

CITY OF BEAUMONT
COMMUNITY FACILITIES DISTRICT NO. 2021-1 (FAIRWAY CANYON)

DIRECT AND OVERLAPPING DEBT
I. Assessed/Appraisal Value') $240,762,396
II. Land Secured Bond Indebtedness
Parcels in
Outstanding Direct and % CFD No. Amount
Overlapping Bonded Debt Type Issued Outstanding Applicable 2021-1 (3) Applicable City of Beaumont CFD No. 2021-1, Series 2024 CFD $14,190,000* $14,190,000* 100.000% 529 $ 14,190,000* TOTAL LAND SECURED BONDED DEBT $ 14,190,000*
Parcels in
Authorized but Unissued Direct and % CFD No. Amount
Overlapping Indebtedness Type Authorized Unissued Applicable 2021-1 (3) Applicable City of Beaumont CFD No. 2021-1, Series 2024(2) CFD $19,500,000 $5,675,000 100.000% 529 $ 0* TOTAL UNISSUED LAND SECURED INDEBTEDNESS $ 0*
TOTAL OUTSTANDING AND UNISSUED LAND SECURED INDEBTEDNESS $ 14,190,000* III. General Obligation Bond Indebtedness
Parcels in
Outstanding Direct and % CFD No. Amount
Overlapping Bonded Debt Type Issued Outstanding Applicable 2021-1 Applicable Beaumont Unified School District GO $281,997,167 $110,484,350 1.863% 529 $ 2,057,918 San Gorgonio Pass Mem Hospital GO 108,000,000 94,135,000 1.373 529 1,292,243 Mt San Jacinto Jr College GO 295,000,000 242,210,000 0.148 529 359,591 TOTAL OUTSTANDING GENERAL OBLIGATION BONDED DEBT $ 3,709,752 Parcels in
% CFD No. Amount
Type Authorized Unissued Applicable 2021-1 Applicable
GO $282,000,000 $2,833 1.863% 529 $ 53
GO 108,000,000 0 1.373 529 0
GO 295,000,000 0 0.148 529 0
$ 53
$ 3,709,804

TOTAL OF ALL OUTSTANDING DIRECT AND OVERLAPPING BONDED DEBT

TOTAL OF ALL OUTSTANDING DIRECT AND UNISSUED DIRECT OVERLAPPING INDEBTEDNESS $ 17,899,752*
$ 17,899,804*
IV. Ratios to Appraisal Value
Outstanding Land Secured Bonded Debt
Total Outstanding Bonded Debt

16.97:1*

13.45:1*
Preliminary, subject to change.
(1) Based on the aggregate assessed/appraised value set forth in the Appraisal Report as of November 1, 2023, the Date of Value. (2) Parity Bonds may be issued for refunding purposes only.

Source: County of Riverside Assessor's Office; Spicer Consulting Group, LLC. 4861-1693-0704v5/022599-0026
29

Based on development status as of November 1, 2023, 520 parcels within the District will be classified as Developed Property for the Fiscal Year 2024-25 Special Tax levy. Debt service for the Bond Year ending September 1, 2024 has been sized assuming that the Special Taxes are levied only on the 520 parcels with building permits issued as of November 1, 2024. Annual Debt Service for the Bonds in each Fiscal Year thereafter has been structured so that Assigned Special Taxes levied on all taxable parcels of Developed Property at buildout (529 parcels), assuming no delinquencies, will generate in each Fiscal Year not less than 110% of debt service payable with respect to the Bonds in the calendar year that begins in that Fiscal Year, plus estimated Administrative Expenses, assuming that Special Taxes are levied and collected on such Developed Property in the District pursuant to the Rate and Method at the Assigned Special Tax rate.

Based on the principal amount of the Bonds, interest costs, Administrative Expenses being levied at the Administrative Expenses Cap, and Fiscal Year 2023-24 tax rates for all other taxing jurisdictions within the District, the total projected Fiscal Year 2024-25 average effective tax rate for Developed Property in the District as of November 1, 2023, is approximately 1.83% of the average assessed value for parcels with improvement value. The following Table 5 sets forth the estimated total tax obligation of property in the District based on the average home size and an average assessed value for a completed home in the District, as set forth in the Appraisal Report.
[Remainder of Page Intentionally Left Blank]
30 4861-1693-0704v5/022599-0026

TABLE 5

CITY OF BEAUMONT
COMMUNITY FACILITIES DISTRICT NO. 2021-1 (FAIRWAY CANYON) ESTIMATED AVERAGE FISCAL YEAR 2024-25 TAX OBLIGATION (1) Average Home Value (2) $ 527,812
Ad Valorem Property Taxes:

General Purpose $ 5,278
Beaumont Unified School (0.07777%) 410
Mt San Jacinto Jr College (0.01320%) 70
San Gorgonio Pass Mem Hospital (0.06242%) 329
San Gorgonio Pass Water Debt Svc (0.17500%) 924
Total General Property Taxes $ 7,011
Assessment, Special Taxes & Parcel Charges:

San Gorgonio Hospital Measure D $ 61
Flood Control Stormwater / Cleanwater / Santa Ana 4
CFD No. 2021-1 - Safety Special Tax(3) 553
CFD No. 2021-1 — Maintenance Services Special Tax(4) 222 CFD No. 2021-1 - Facilities Special Tax(5) 1,814
Total Assessments & Special Taxes $ 2,653
Projected Total Property Tax $ 9,664
Projected Effective Tax Rate (3) 1.83%
(1) Average Fiscal Year 2023-24 tax rates based upon Fiscal Year 2023-24 Overlapping Taxes and Assessment Rates. (2) Average Home Value is based upon average Fiscal Year 2023-24 assessed value for a completed home in the District as set forth in the Appraisal Report.
(3) Reflects the District's Fiscal Year 2024-25 projected levy for Developed Property. Per the Rate and Method, the maximum special tax for public services for the prior fiscal year shall be adjusted by the greater of (i) an amount equal to the annual percent increase in the Consumer Price Index for the calendar year ending in January of the prior fiscal year or (ii) five percent. (4) Reflects the District's Fiscal Year 2024-25 projected special tax levy for Developed Property. Per the Rate and Method, the maximum special tax for maintenance services for the prior fiscal year shall be adjusted by the greater of (i) an amount equal to the annual percent increase in the Consumer Price Index for the calendar year ending in January of the prior fiscal year or (ii) two percent.
(5) Reflects the District's average projected Fiscal Year 2024-25 Special Tax levy for Developed Property.

Source: Spicer Consulting Group, LLC, based on home value information provided by Riverside County.

Delinquency History
For each Fiscal Year, the first installment of the Special Taxes becomes due on December 10 and the second installment becomes due on April 10. Special Taxes within the District were first levied in Fiscal Year 2022-23. Table 6 below summarizes the annual secured tax levy within the District and the amounts delinquent as of November 1, 2023 for Fiscal Year 2022-23. Future delinquencies could increase as a result of factors such as changes in the local or national economy, increases in the mortgage rates and/or increases in the unemployment rate in the area. See "SPECIAL RISK FACTORS —Special Tax Delinquencies." 31 4861-1693-0704v5/022599-0026

TABLE 6

CITY OF BEAUMONT
COMMUNITY FACILITIES DISTRICT NO. 2021-1

SPECIAL TAX LEVIES, DELINQUENCIES, AND DELINQUENCY RATES FISCAL YEARS 2022-23 AND 2023-20
Delinquencies as of November 1, 2023
Parcels Amount Percent
Fiscal Year Amount Levied Parcels Levied Delinquent Delinquent Delinquent 2022-23 $422,065 213 0 $0 0.00%
2023-24 855,905 430 N/A N/A N/A
(1) Fiscal Year 2022-23 was the first year that the Special Tax was levied.

Source: Spicer Consulting Group, LLC and Riverside County Tax Collector.

Top Taxpayers
As of November 1, 2023, individual homeowners owned 419 of the 529 planned homes in the District.

Based on ownership status and development status as of November 1, 2023, and assuming no additional transfers of property or issuance of building permits, individual homeowners are projected to be responsible for 80.6% of the Special Taxes projected to be levied on Developed Property in Fiscal Year 2024-25. Assuming no additional transfers of property or issuance of building permits after November 1, 2023, D.R. Horton, Woodside and Richmond are projected to be responsible for 4.5%, 7.2% and 7.7% of the projected Fiscal Year 2024-25 Special Tax levy.

In Fiscal Year 2024-25, the District expects to levy the Special Tax only on the 520 parcels classified as Developed Property as of November 1, 2023 and not on the nine parcels of Final Map Property (which are owned by Richmond American), however, the District has the ability to levy the Special Tax on Final Map Property under the Rate and Method if necessary to meet the Special Tax Requirement for Facilities. The District is not aware of any individual, other than the merchant builders in the District, who owns more than one parcel within the District.

PROPERTY OWNERSHIP AND THE DEVELOPMENT
The information regarding the development and ownership of the Property contained under this caption, "PROPERTY OWNERSHIP AND THE DEVELOPMENT" has been provided by representatives of the Developer, D.R. Horton, Woodside and Richmond American and has not been independently confirmed or verified by the Underwriter, the City or the District. The Underwriter, the City and the District make no representation as to the accuracy or adequacy of the information contained under this caption. There may be material adverse changes in this information after the date of this Official Statement. Neither the Bonds nor the Special Taxes securing the Bonds are personal obligations of the Developer, KB Home, D.R. Horton, Woodside or any affiliate thereof or any other property owner and, in the event that any property owner defaults in the payment of its Special Taxes, the District may proceed with judicial foreclosure but has no direct recourse to the assets of any property owner or any affiliate thereof See "SPECIAL RISK FACTORS" herein." Fairway Canyon and the District
The development in the District is part of the master -planned community in the City known as "Fairway Canyon." At buildout, Fairway Canyon is expected to consist of approximately 3,300 residential units on approximately 1,556 acres of land, with 46.4 acres of commercial/industrial land uses and the balance set aside for public/quasi/public uses. As of November 1, 2023, the Developer estimates that approximately 2,350 homes within Fairway Canyon have been completed and sold to individual homeowners. 32 4861-1693-0704v5/022599-0026

The Developer has completed, or has caused to be completed, all the backbone infrastructure necessary to complete the development in the District. The property in the District is planned for 529 single family homes at buildout. The Developer has conveyed all the property in the District planned for residential to three merchant builders. The Developer no longer owns any property in the District that is subject to the Special Tax. As of November 1, 2023, 419 homes within the District have been completed and conveyed to individual homeowners.

As of such date, Woodside, D.R. Horton and Richmond American owned 40, 23 and 47 lots, respectively, in the District in various stages of construction. The merchant builders within the District expect to complete the remaining in -tract infrastructure for their respective projects commensurate with the timing for completion of the remaining planned homes.

Each of the merchant builder's projects in the District are described below.

D.R. Horton Development and Financing Plan
General. As previously defined in this Official Statement "D.R. Horton" is D.R. Horton Los Angeles Holding Company, Inc., a California corporation. D.R. Horton is a wholly -owned subsidiary of D.R. Horton, Inc., a Delaware corporation ("D.R. Horton, Inc."). D.R. Horton, Inc. is a public company whose common stock is traded on the New York Stock Exchange under the symbol "DHI." Founded in 1978 and headquartered in Arlington, Texas, D.R. Horton, Inc. constructs and sells homes through its operating divisions in 90 markets in 29 states under the names of D.R. Horton, America 's Builder, Emerald Homes, Express Homes and Freedom Homes.

D.R. Horton, Inc. is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files reports, proxy statements and other information, including financial statements, with the Securities and Exchange Commission (the "SEC"). Such filings, particularly, D.R. Horton, Inc.'s Annual Report on Form 10-K for the fiscal year ended September 30, 2023, as filed with the SEC on November 17, 2023, and D.R. Horton's Quarterly Report on Form 10-Q for the quarter ended June 30, 2023, as filed with the SEC on July 24, 2023, set forth certain data relative to the consolidated results of operations and financial position of D.R. Horton, Inc. and its subsidiaries, including D.R.

Horton, as of such dates.

The SEC maintains an Internet web site that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC, including D.R. Horton, Inc. The address of such Internet web site is www.sec.gov . All documents subsequently filed by D.R. Horton, Inc. pursuant to the requirements of the Exchange Act after the date of this Official Statement will be available for inspection in such manner as the SEC prescribes.

Copies of D.R. Horton, Inc.'s Annual Report and each of its other quarterly and current reports, including any amendments, are available from D.R. Horton, Inc.'s website at www.drhorton.com .

The foregoing Internet addresses and references to filings with the SEC are included for reference only, and the information on these Internet sites and on file with the SEC are not a part of this Official Statement and are not incorporated by reference into this Official Statement. No representation is made in this Official Statement as to the accuracy or adequacy of the information contained on these Internet sites. None of D.R.

Horton or D.R. Horton, Inc. is obligated to advance funds to pay for development or construction costs or to pay ad valorem property taxes or the Special Taxes, and investors should not rely on the information and financial statements contained on such internet sites in evaluating whether to buy, hold or sell the Bonds.

Development Plan. D.R. Horton's project in the District consists of 268 single-family detached homes in a neighborhood being marketed as "Augusta at the Fairways." As of November 1, 2023, D.R. Horton had completed and conveyed 245 homes in the District to individual homeowners. As of such date D.R. Horton owned 23 lots in the District consisting of three completed model homes, two completed production homes and 18 homes under construction. As of November 1, 2023, D.R. Horton had four homes in escrow, however, homes 33 4861-1693-0704v5/022599-0026

under contract may not result in closed escrows as sales contracts are subject to cancellation. D.R. Horton expects to complete and convey all remaining homes within its project in the District to individual homeowners by July 1, 2024.

All approvals and permits required for development of property within D.R. Horton's project within the District have been secured for residential construction, including building permits for all of D.R. Horton's remaining planned homes. As of November 1, 2023, in -tract improvements remaining to be completed within D.R. Horton's development consisted primarily of final finishing of streets, curbs, gutters, and landscaping. D.R.

Horton expects to complete construction of the remaining in -tract improvements associated with the lots that it owns within the District as home construction on such lots is completed.

The table below summarizes, as of November 1, 2023, the product mix and development status of D.R.

Horton's project within the District.

COMMUNITY FACILITIES DISTRICT NO. 2021-1 (FAIRWAY CANYON) D.R. HORTON

AUGUSTA AT THE FAIRWAYS
(As of November 1, 2023)
Owned by D.R. Horton
Estimated Completed
Total Home Closings as of Homes/Homes
Units Square November 1, Under Finished Base Home
Plan Planned Footage 2023 Construction0 Lots Prices0
1 43 1,342 39 4 0 N/A(3)
2 32 1,865 30 2 0 $537,000
3 43 1,981 38 5 0 527,000
4 40 1,986 37 3 0 492,000
5 43 2,065 40 3 0 453,000
6 32 2,259 29 3 0 540,000
7 35 2,617 32 3 0 N/A(3)
Total 268 245 23 0
(1) Includes three model homes and 20 homes under construction. (2) Base home prices shown exclude lot premiums, options and extras and any incentives or price reductions. Base sales prices are subject to change.
(3) Floor plans are sold out.

Source: D.R. Horton.

No assurance can be given that D.R. Horton's home construction and sales will be carried out on the schedule and according to the plans outlined herein, or that the home construction and sale plans or base prices set forth above will not change after the date of this Official Statement. Additionally, homes sold may not result in closed escrows as sales contracts are subject to cancellation. In changing market conditions, builders will often revise the product lines and prices and the rate of sales can fluctuate. D.R. Horton continuously evaluates its product lines and prices in light of the then current market conditions. See "SPECIAL RISK FACTORS" herein for a discussion of risk factors.

Financing Plan. Through November 1, 2023, D.R. Horton had spent approximately $61,570,764 in site acquisition and development costs, permits and impact fees, home construction costs, and other development, marketing and sales costs (exclusive of internal financing repayment, corporate overhead and other carry costs) related to its development within the District. D.R. Horton expects to spend approximately $5,324,329 in additional site development costs, permit and impact fees, home construction costs, and other development, marketing and sales costs (exclusive of corporate overhead and other carry costs) between November 1, 2023 and full build -out of its homes proposed to be constructed in the District. 34 4861-1693-0704v5/022599-0026

To date, D.R. Horton has financed its land acquisition, site development and home construction costs related to its property within the District through internally generated funds. D.R. Horton expects to use internal funding (which may include home sales revenues from its project within the District) to complete its development activities within the District. However, home sales revenues from D.R. Horton's activities in the District are not segregated and set aside for completing the homes in the District. Notwithstanding the foregoing, D.R. Horton believes that it will have sufficient funds to complete its construction and sale of homes in the District.

Notwithstanding the current belief of D.R. Horton that it will have sufficient funds to complete its planned development in the District, no assurance can be given that sources of financing available to D.R. Horton will be sufficient to complete the property development and home construction as currently anticipated. Neither D.R. Horton nor any of its related entities are under any legal obligation of any kind to expend funds for the development and construction of homes on its property in the District, or the payment of ad valorem property taxes or the Special Taxes. Any contributions by D.R. Horton to fund the costs of such development are entirely voluntary.

If and to the extent that internal funding, including but not limited to home sales revenues are inadequate to pay the costs to complete the planned development by D.R. Horton within the District and other financing by D.R. Horton is not put into place, there could be a shortfall in the funds required to complete the planned development by D.R. Horton or to pay ad valorem property taxes or Special Taxes related to D.R. Horton's property in the District, and the remaining portions of D.R. Horton's project in the District may not be completed.

Many factors beyond D.R. Horton's control, or a decision by D.R. Horton to alter its current plans, may cause the actual sources and uses to differ from the projections. See "SPECIAL RISK FACTORS" herein for a discussion of risk factors.

Woodside Development and Financing Plan
General. Woodside 05S, LP, a California limited partnership (previously defined as "Woodside") is wholly owned by Woodside Group, LLC, a Nevada limited liability company ("Woodside Group"), directly or through its wholly owned subsidiaries. Woodside is owned 99% directly by Woodside Group, as a limited partner. The remaining 1% interest is owned by WDS GP, Inc., a California corporation, as its general partner, which is wholly owned by Woodside Homes of California, Inc., a California corporation, which in turn is wholly owned by Woodside Group. The parent of Woodside Group is Woodside Homes Company, LLC, a Delaware limited liability company ("Woodside Homes Company"). Since February 28, 2017, the ultimate parent of Woodside Homes Company has been Sekisui House Ltd., a Japanese public company based in Osaka, Japan, whose stock is listed on the Tokyo and Nagoya Stock Exchanges. Sekisui House, Ltd. is one of Japan's largest homebuilders and was founded in 1960.

Woodside Group's subsidiaries engage in the design, construction, and sale of single-family homes under the brand name of "Woodside Homes." Woodside Homes is one of America's top 30 homebuilders having built more than 40,000 homes across the United States, with current operations in Arizona, California, Nevada, Utah, and Idaho.

Development Plan. Woodside is developing 199 single-family detached homes in the District in two neighborhoods being marketed as "Ridge View at the Fairways" (126 units) and "Big Canyon at the Fairways" (73 units). As of November 1, 2023, Woodside had completed and conveyed 159 of the 199 planned homes within its two projects in the District.

As of November 1, 2023, within Ridge View, 89 homes had been completed and conveyed to individual homeowners, and Woodside owned the remaining 37 lots consisting of four completed model homes, six completed production homes, 14 homes under construction, and 13 finished lots without any home construction thereon. As of November 1, 2023, within Big Canyon, 70 homes had been completed and conveyed to individual homeowners, and Woodside owned the remaining three lots consisting of two completed models and one 35 4861-1693-0704v5/022599-0026

completed production home. As of November 1, 2023, 18 of the remaining 37 homes within Ridge View and the remaining three homes within Big Canyon were in escrow, however, homes under contract may not result in closed escrows as sales contracts are subject to cancellation. Woodside expects to complete and convey all remaining homes within its projects in the District to individual homeowners by August, 2024.

All approvals and permits required for development of property within Woodside's projects within the District have been secured for residential construction, including building permits for all of Woodside's remaining planned homes. As of November 1, 2023, in -tract improvements remaining to be completed within Woodside's development consisted primarily of final finishing of streets, curbs, gutters, and landscaping.

Woodside expects to complete construction of the remaining in -tract improvements associated with the lots that it owns within the District as home construction on such lots is completed.

The tables below summarize, as of November 1, 2023, the product mix and development status of Woodside's Ridge View and Big Canyon projects within the District:

COMMUNITY FACILITIES DISTRICT NO. 2021-1 (FAIRWAY CANYON)

WOODSIDE

RIDGE VIEW AT THE FAIRWAYS
(As of November 1, 2023)
Estimated
Total Home
Units Square
Plan Planned Footage
1 19 1,432
2 36 2,024
3 37 2,227
4 34 2,362
Total 126
Closings as of
November 1,
2023
Owned by Woodside
Completed
Homes/Homes
Under
Construction0
Finished Base Home
Lots(2 Prices(3)
18 1 0 $445,000
25 7 4 504,000
25 7 5 525,000
21 9 4 529,000
89 24 13
Includes four completed model homes, six completed production homes and 14 homes under construction.

Represents finished lots without any home construction thereon, all with building permits issued.

Base home prices shown exclude lot premiums, options and extras and any incentives or price reductions. Base sales prices are subject to change.

Source: Woodside.
4861-1693-0704v5/022599-0026
36

COMMUNITY FACILITIES DISTRICT NO. 2021-1 (FAIRWAY CANYON)

WOODSIDE

BIG CANYON AT THE FAIRWAYS
(As of November 1, 2023)
Owned by Woodside
Estimated Completed
Total Home Closings as of Homes/Homes
Units Square November 1, Under Finished Base Home
Plan Planned Footage 2023 Constructional Lots Priceso
1 27 2,023 26 1 0 $510,990
2 23 2,720 22 1 0 $565,900
3 23 3,090 22 1 0 $598,990
Total 73 70 3 0
(1) Includes two completed model homes and one completed production home. (2) Base home prices shown exclude lot premiums, options and extras and any incentives or price reductions. Base sales prices are subject to change.

Source: Woodside.

No assurance can be given that Woodside's home construction and sales will be carried out on the schedule and according to the plans outlined herein, or that the home construction and sale plans or base prices set forth above will not change after the date of this Official Statement. Additionally, homes sold may not result in closed escrows as sales contracts are subject to cancellation. In changing market conditions, builders will often revise the product lines and prices and the rate of sales can fluctuate. Woodside continuously evaluates its product lines and prices in light of the then current market conditions. See "SPECIAL RISK FACTORS" herein for a discussion of risk factors.

Financing Plan. Through November 1, 2023, Woodside had spent approximately $39,600,000 in site acquisition and development costs, permits and impact fees, home construction costs, and other development, marketing and sales costs (exclusive of internal financing repayment, corporate overhead and other carry costs) related to its Ridge View development within the District. Woodside expects to spend approximately $10,800,000 in additional site development costs, permit and impact fees, home construction costs, and other development, marketing and sales costs (exclusive of corporate overhead and other carry costs) between November 1, 2023 and full build -out of the Ridge View homes proposed to be constructed in the District.

Through November 1, 2023, Woodside had spent approximately $30,200,000 in site acquisition and development costs, permits and impact fees, home construction costs, and other development, marketing and sales costs (exclusive of internal financing repayment, corporate overhead and other carry costs) related to its Big Canyon development within the District. Woodside expects to spend approximately $400,000 in additional site development costs, permit and impact fees, home construction costs, and other development, marketing and sales costs (exclusive of corporate overhead and other carry costs) between November 1, 2023 and full build - out of the Big Canyon homes proposed to be constructed in the District.

To date, Woodside has financed its land acquisition, site development and home construction costs related to its property within the District through internal sources, including cash generated from its homebuilding operations and advances from affiliates of its parent Woodside Homes Company. Woodside Homes Company has a $330 million unsecured term loan. Woodside Homes Company also has an unsecured revolving credit facility with borrowing capacity as of October 1, 2023 of $250 million, which is not subject to a borrowing base.

Woodside expects to use internal sources, including cash generated from its homebuilding operations and advances from affiliates of its parent Woodside Homes Company, to complete its development activities within the District. However, home sales revenues from Woodside's activities in the District are not segregated 37 4861-1693-0704v5/022599-0026

and set aside for completing the homes in the District. Notwithstanding the foregoing, Woodside believes that it will have sufficient funds to complete its construction and sale of homes in the District.

Notwithstanding the current belief of Woodside that it will have sufficient funds to complete its planned development in the District, no assurance can be given that sources of financing available to Woodside will be sufficient to complete the property development and home construction as currently anticipated. While Woodside has made such internal financing available in the past, there can be no assurance whatsoever of its willingness or ability to do so in the future. Neither Woodside nor any of its related entities are under any legal obligation of any kind to expend funds for the development and construction of homes on its property in the District, or the payment of ad valorem property taxes or the Special Taxes. Any contributions by Woodside to fund the costs of such development are entirely voluntary.

If and to the extent that internal funding, including but not limited to home sales revenues are inadequate to pay the costs to complete the planned development by Woodside within the District and other financing by Woodside is not put into place, there could be a shortfall in the funds required to complete the planned development by Woodside or to pay ad valorem property taxes or Special Taxes related to Woodside's property in the District, and the remaining portions of Woodside'sprojects in the District may not be completed. Many factors beyond Woodside's control, or a decision by Woodside to alter its current plans, may cause the actual sources and uses to differ from the projections. See "SPECIAL RISK FACTORS" herein for a discussion of risk factors.

Richmond American Development and Financing Plan
General. Richmond American Homes of Maryland, Inc., a Maryland corporation (previously defined as "Richmond American") is a wholly -owned subsidiary of M.D.C. Holdings, Inc., a Delaware corporation ("MDC"). MDC is a publicly traded company whose common stock is listed on the New York Stock Exchange under the symbol "MDC." Richmond American and its predecessor entity have been building homes in California since 1986. Richmond American's Southern California division based in Irvine, California, is responsible for the development of Richmond American's project in the District.

MDC has two primary operations — homebuilding and financial services. MDC's homebuilding operations consist of wholly -owned subsidiary companies that build and sell homes under the name "Richmond American Homes." MDC's financial services operations include subsidiary companies that provide mortgage financing, place title insurance and homeowner insurance for Richmond American's homebuyers, and provide general liability insurance for MDC subsidiaries and most of Richmond American's subcontractors.

MDC is subject to the informational reporting requirements of the Exchange Act of 1943, and in accordance therewith is obligated to file reports, proxy statements, and other information, including financial statements, with the SEC. Such filings, including particularly MDC's Annual Report on Form 10-K for the fiscal year ended December 31, 2022, as filed with the SEC on January 31, 2023, and Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, as filed with the SEC on October 26, 2023, set forth certain data relative to such consolidated results of operations and financial position of MDC and its subsidiaries as of such dates. The SEC maintains an internet web site that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC, including MDC. The address of such internet web site is www.sec.gov . All documents subsequently filed by MDC pursuant to the requirements of the Exchange Act after the date of this Official Statement will be available for inspection in such manner as the SEC prescribes. Copies of MDC's Annual Report and related financial statements, prepared in accordance with generally accepted accounting standards, are also available from MDC on MDC's website at www.mdcholdings.com .

The foregoing Internet addresses and references to filings with the SEC are included for reference only, and the information on these Internet sites and on file with the SEC are not a part of this Official Statement and are not incorporated by reference into this Official Statement. No representation is made in this Official 38 4861-1693-0704v5/022599-0026

Statement as to the accuracy or adequacy of the information contained on these Internet sites. None of Richmond American or MDC is obligated to advance funds to pay for development or construction costs or to pay ad valorem property taxes or the Special Taxes, and investors should not rely on the information and financial statements contained on such internet sites in evaluating whether to buy, hold or sell the Bonds.

Development Plan. Richmond American's project in the District consists of 62 single-family detached homes in a neighborhood being marketed as "Seasons at the Fairways." As of November 1, 2023, Richmond American had completed and conveyed 15 homes in the District to individual homeowners. As of such date Richmond American owned 47 lots in the District consisting of two completed model homes, four completed production homes, 19 homes under construction and 22 finished lots. As of November 1, 2023, Richmond American had nine homes in escrow, however, homes under contract may not result in closed escrows as sales contracts are subject to cancellation. Richmond American expects to complete and convey all remaining homes within its project in the District to individual homeowners by February, 2025.

All approvals and permits required for development of property within Richmond American's project within the District have been secured for residential construction, with the exception of building permits for nine of Richmond American's remaining planned homes. As of November 1, 2023, in -tract improvements remaining to be completed within Richmond American's development consisted primarily of final finishing of streets, curbs, gutters, and landscaping. Richmond American expects to complete construction of the remaining in -tract improvements associated with the lots that it owns within the District as home construction on such lots is completed.

The table below summarizes, as of November 1, 2023, the product mix and development status of Richmond American's project within the District.

COMMUNITY FACILITIES DISTRICT NO. 2021-1 (FAIRWAY CANYON)

RICHMOND AMERICAN

SEASONS AT THE FAIRWAYS
(As of November 1, 2023)
Estimated
Total Home
Units Square
Plan Planned Footage
1 20 2,375
2 21 2,681
3 21 3,046
Total 62
Closings as of
November 1,
2023
Owned by Richmond American
Completed
Homes/Homes
Under
Construction0
Finished Base Home
Lots Prices0
5 7 8 $516,990
5 8 8 $549,990
5 10 6 $579,990
15 25 22
(1) Includes two completed model homes, 4 completed production homes and 19 homes under construction. (2) Base home prices shown exclude lot premiums, options and extras and any incentives or price reductions. Base sales prices are subject to change.

Source: Richmond American.

No assurance can be given that Richmond American's home construction and sales will be carried out on the schedule and according to the plans outlined herein, or that the home construction and sale plans or base prices set forth above will not change after the date of this Official Statement. Additionally, homes sold may not result in closed escrows as sales contracts are subject to cancellation. In changing market conditions, builders will often revise the product lines and prices and the rate of sales can fluctuate. Richmond American continuously evaluates its product lines and prices in light of the then current market conditions. See "SPECIAL RISK FACTORS" herein for a discussion of risk factors.
4861-1693-0704v5/022599-0026
39

Financing Plan. Through November 1, 2023, Richmond American had spent approximately $25 million in site acquisition and development costs, permits and impact fees, home construction costs, and other development, marketing and sales costs (exclusive of internal financing repayment, corporate overhead and other carry costs) related to its development within the District. Richmond American expects to spend approximately $10.5 million in additional site development costs, permit and impact fees, home construction costs, and other development, marketing and sales costs (exclusive of corporate overhead and other carry costs) between November 1, 2023 and full build -out of the homes proposed to be constructed in the District.

To date, Richmond American has financed its land acquisition, site development and home construction costs related to its property within the District through internally generated funds, including funding from its parent company, MDC. Richmond American expects to use internal funding (which may include home sales revenues from its project within the District) to complete its development activities within the District. However, home sales revenues from Richmond American's activities in the District are not segregated and set aside for completing the homes in the District. Notwithstanding the foregoing, Richmond American believes that it will have sufficient funds to complete its construction and sale of homes in the District.

Notwithstanding the current belief of Richmond American that it will have sufficient funds to complete its planned development in the District, no assurance can be given that sources of financing available to Richmond American will be sufficient to complete the property development and home construction as currently anticipated. While Richmond American has made such internal funding available in the past, there can be no assurance whatsoever of its willingness or ability to do so in the future. Neither Richmond American nor any of its related entities are under any legal obligation of any kind to expend funds for the development and construction of homes on its property in the District, or the payment of ad valorem property taxes or the Special Taxes. Any contributions by Richmond American to fund the costs of such development are entirely voluntary.

If and to the extent that internal funding, including but not limited to home sales revenues are inadequate to pay the costs to complete the planned development by Richmond American within the District and other financing by Richmond American is not put into place, there could be a shortfall in the funds required to complete the planned development by Richmond American or to pay ad valorem property taxes or Special Taxes related to Richmond American's property in the District, and the remaining portions of Richmond American's project in the District may not be completed. Many factors beyond Richmond American's control, or a decision by Richmond American to alter its current plans, may cause the actual sources and uses to differ from the projections. See "SPECIAL RISK FACTORS" herein for a discussion of risk factors.

SPECIAL RISK FACTORS
The purchase of the Bonds involves significant risks and is not an appropriate investment for all investors. The following is a discussion of certain risk factors which should be considered, in addition to other matters set forth herein, in evaluating the investment quality of the Bonds. The Bonds have not been rated by a rating agency. This discussion does not purport to be comprehensive or definitive and does not purport to be a complete statement of all factors which may be considered as risks in evaluating the credit quality of the Bonds.

The occurrence of one or more of the events discussed herein could adversely affect the ability or willingness of property owners in the District to pay their Special Taxes when due. Such failures to pay Special Taxes could result in the inability of the District to make full and punctual payments of debt service on the Bonds. In addition, the occurrence of one or more of the events discussed herein could adversely affect the value of the property in the District. See "—Property Values" and "—Limited Secondary Market." Concentration of Ownership
Based on ownership status and development status as of November 1, 2023, and assuming no additional transfers of property and issuance of building permits, approximately 80.6% of the Special Taxes projected to be levied in Fiscal Year 2024-25 will be payable by individual homeowners and the balance by the merchant builders as set forth in Table 2 above. Debt service for the Bond Year ending September 1, 2024 has been sized 40 4861-1693-0704v5/022599-0026

assuming that the Special Taxes are levied only on the 520 parcels with building permits issued as of November 1, 2024. Annual Debt Service for the Bonds in each Fiscal Year thereafter has been structured so that Assigned Special Taxes levied on all taxable parcels of Developed Property at buildout (529 parcels), assuming no delinquencies, will generate in each Fiscal Year not less than 110% of debt service payable with respect to the Bonds in the calendar year that begins in that Fiscal Year, plus estimated Administrative Expenses, assuming that Special Taxes are levied and collected on such Developed Property in the District pursuant to the Rate and Method at the Assigned Special Tax rate.

Failure of individual homeowners, the merchant builders described herein, entities affiliated with the merchant builders or any successor(s), to pay the annual Special Taxes when due could result in a draw on the Reserve Account of the Special Tax Fund, and ultimately a default in payments of the principal of, and interest on, the Bonds, when due. No assurance can be given that the merchant builders or any successors, will complete the remaining intended construction and development in the District.

Risks of Real Estate Secured Investments Generally
The Bond Owners will be subject to the risks generally incident to an investment secured by real estate, including, without limitation: (i) adverse changes in local market conditions, such as changes in the market value of real property in the vicinity of the District, the supply of or demand for competitive properties in such area, and the market value of residential property or buildings and/or sites in the event of sale or foreclosure; (ii) changes in real estate tax rates and other operating expenses, governmental rules (including, without limitation, zoning laws and laws relating to endangered species and hazardous materials) and fiscal policies; (iii) natural disasters (including, without limitation, earthquakes, wildfires and floods), which may result in uninsured losses; (iv) adverse changes in local market conditions; and (v) increased delinquencies due to rising mortgage costs and other factors.

No assurance can be given that the property owners within the District will pay Special Taxes in the future or that they will be able to pay such Special Taxes on a timely basis. See the caption "— Enforcement Delays — Bankruptcy" for a discussion of certain limitations on the District's ability to pursue judicial proceedings with respect to delinquent parcels.

Limited Obligations
The Bonds and interest thereon are not payable from the general funds of the City. Except with respect to the Net Taxes, neither the credit nor the taxing power of the District or the City is pledged for the payment of the Bonds or the interest thereon, and, except as provided in the Indenture, no Owner of the Bonds may compel the exercise of any taxing power by the District or the City or force the forfeiture of any City or District property.

The principal of, premium, if any, and interest on the Bonds are not a debt of the City or a legal or equitable pledge, charge, lien or encumbrance upon any of the City's or the District's property or upon any of the City's or the District's income, receipts or revenues, except the Net Taxes and other amounts pledged under the Indenture.

The District's legal obligations with respect to any delinquent Special Taxes are limited to: (i) payments from the Subaccounts of the Reserve Account to the extent of funds on deposit therein; and (ii) the institution of judicial foreclosure proceedings under certain circumstances with respect to any parcels for which Special Taxes are delinquent. See the caption "SOURCES OF PAYMENT FOR THE BONDS — Special Taxes — Proceeds of Foreclosure Sales." The Bonds cannot be accelerated in the event of any default.

The obligation to pay Special Taxes does not constitute a personal obligation of the current or subsequent owners of the respective parcels which are subject to such liens. See the caption "— Payment of the Special Tax is Not a Personal Obligation of the Property Owners." Enforcement of Special Tax payment obligations by the District is limited to judicial foreclosure in the Superior Court of California, County of Riverside. There is no assurance that any current or subsequent owner of a parcel subject to a Special Tax lien 41 4861-1693-0704v5/022599-0026

will be able to pay the amounts due or that such owner will choose to pay such amounts even though financially able to do so.

Failure by owners of the parcels to pay Special Tax installments when due, delay in foreclosure proceedings, or the inability of the District to sell parcels that have been subject to foreclosure proceedings for amounts sufficient to cover the delinquent installments of Special Taxes levied against such parcels may result in the inability of the District to make full or timely payments of debt service on the Bonds, which may in turn result in the depletion of the 2024 Bonds Reserve Subaccount. See the caption "— Enforcement Delays — Bankruptcy.

Insufficiency of Special Taxes
As discussed below, the Special Taxes may not produce revenues sufficient to pay the debt service on the Bonds due to nonpayment of the amounts levied.

In order to pay debt service on the Bonds, it is generally necessary that the Special Taxes be paid in a timely manner. Should the Special Taxes not be paid on time, the District has established 2024 Bonds Reserve Subaccount under the Indenture to be maintained in an amount equal to the 2024 Bonds Reserve Requirement to pay debt service on the Bonds to the extent other funds are not available. See "SOURCES OF PAYMENT FOR THE BONDS — 2024 Bonds Reserve Subaccount of the Reserve Account of the Special Tax Fund." The District will covenant in the Indenture to maintain in the 2024 Bonds Reserve Subaccount an amount equal to the 2024 Bonds Reserve Requirement, subject, however, to the availability of Net Taxes in amounts sufficient to do so and to the limitation that the District may not levy the Special Tax in any Fiscal Year at a rate in excess of the maximum amounts permitted under the Rate and Method. See Appendix A and Appendix D hereto. As a result, if a significant number of Special Tax delinquencies occurs within the District, the District could be unable to replenish the 2024 Bonds Reserve Subaccount to the 2024 Bonds Reserve Requirement due to the limitations on the amount of the Special Tax that may be levied. If such defaults were to continue in successive years, the 2024 Bonds Reserve Subaccount could be depleted and a default on the Bonds could occur.

The 2024 Bonds Reserve Subaccount only secures and the amounts therein are only available to pay the principal of, redemption premium, if any, and interest on the Bonds. In connection with the issuance of a series of Parity Bonds, if any, the District may establish additional Subaccounts within the Reserve Account which secures such series of Parity Bonds. Such additional Subaccounts within the Reserve Account established for Parity Bonds will not secure the Bonds.

The Act provides that, if any property within the District not otherwise exempt from the Special Tax is acquired by a public entity through a negotiated transaction, or by gift or devise, the Special Tax will continue to be levied on and enforceable against the public entity that acquired the property. In addition, the Act provides that, if property subject to the Special Tax is acquired by a public entity through eminent domain proceedings, the obligation to pay the Special Tax with respect to that property is to be treated as if it were a special assessment and be paid from the eminent domain award. The constitutionality and operation of these provisions of the Act have not been tested in the courts, but it is doubtful that they would be upheld as to, for example, property owned by the federal government. If for any reason property within the District becomes exempt from taxation by reason of ownership by a non-taxable entity such as the federal government or another public agency, subject to the limitation of the Maximum Special Tax, the Special Tax will be reallocated to the remaining taxable parcels within the District. This would result in the owners of such property paying a greater amount of the Special Tax and could have an adverse impact upon their willingness and/or ability to pay the Special Tax. Moreover, if a substantial portion of additional land within the District became exempt from the Special Tax because of public ownership, or otherwise, the Maximum Special Tax which could be levied upon the remaining acreage might not be sufficient to pay principal of and interest on the Bonds when due and a default will occur with respect to the payment of such principal and interest.
42 4861-1693-0704v5/022599-0026

The District will covenant in the Indenture that, under certain circumstances, it will institute foreclosure proceedings to sell any property with delinquent Special Taxes in order to obtain funds to pay debt service on the Bonds. If foreclosure proceedings were ever instituted, any mortgage or deed of trust holder could, but would not be required to, advance the amount of the delinquent Special Tax to protect its security interest. See "SOURCES OF PAYMENT FOR THE BONDS — Special Taxes — Proceeds of Foreclosure Sales" for provisions which apply in the event of such foreclosure and which the District is required to follow in the event of delinquencies in the payment of the Special Tax.

In the event that sales or foreclosures of property are necessary, there could be a delay in payments to Owners of the Bonds (if the 2024 Bonds Reserve Subaccount has been depleted) pending such sales or the prosecution of such foreclosure proceedings and receipt by the City on behalf of the District of the proceeds of sale. The District may adjust the future Special Tax levied on taxable parcels in the District, subject to limitations described above under the caption "THE DISTRICT — Rate and Method of Apportionment," to provide an amount required to pay interest on and principal of the Bonds, and the amount, if any, necessary to replenish the 2024 Bonds Reserve Subaccount to an amount equal to the 2024 Bonds Reserve Requirement, and to pay all current expenses. There is, however, no assurance that the total amount of the Special Tax that could be levied and collected against taxable parcels in the District will be at all times sufficient to pay the amounts required to be paid by the Indenture, even if the Special Tax is levied at the Maximum Special Tax rates. See "— Enforcement Delays — Bankruptcy."
No assurance can be given that the real property subject to sale or foreclosure will be sold, or if sold, that the proceeds of sale will be sufficient to pay any delinquent installments of the Special Tax. The Act does not require the City to purchase or otherwise acquire any lot or parcel of property to be sold at foreclosure if there is no other purchaser at such sale. The Act and the Indenture do specify that the Special Tax will have the same lien priority as for ad valorem property taxes in the case of delinquency. Section 53356.6 of the Act requires that property sold pursuant to foreclosure under the Act be sold for not less than the amount of judgment in the foreclosure action, plus post judgment interest and authorized costs, unless the consent of the owners of 75% of the Outstanding Bonds and any Parity Bonds is obtained.

Prior to July 1, 1983, the right of redemption from foreclosure sales was limited to a period of one year from the date of sale. Under legislation effective July 1, 1983, the statutory right of redemption from such foreclosure sales has been repealed. However, a period of 20 days must elapse after the date on which the notice of levy of the interest in real property was served on the judgment debtor before the sale of such lot or parcel can be made. Furthermore, if the purchaser at the sale is the judgment creditor (e.g., the District), an action may be commenced by the delinquent property owner within 90 days after the date of sale to set aside such sale. The constitutionality of the aforementioned legislation, which repeals the one-year redemption period, has not been tested and there can be no assurance that, if tested, such legislation will be upheld. (Section 701.680 of the Code of Civil Procedure of the State).

Increasing Mortgage Interest Rates
30 -year fixed mortgage interest rates have increased substantially over the past year. Increases in mortgage interest rates could have a negative impact on the estimated absorption rates of the planned for -sale residential units in the District described herein. With respect to entry-level households, increased mortgage interest rates may adversely impact the affordability of homes and may increase mortgage payment levels for owning a lower -priced home relative to renting a residence, thereby making purchasing less attractive. With respect to move -up households, higher mortgage interest rates may impact the desire of current homeowners to move from their present home due to the fact that their present home likely has a relatively low mortgage interest rate. In addition, the new home would likely have a higher interest rate on a new mortgage loan as well as higher purchase price and property taxes. Such considerations may decrease the desire for move -up households to purchase a new home.
43 4861-1693-0704v5/022599-0026

Impact of Economic Conditions on the Development in the District Certain events and factors which negatively affect the regional, State and national economies could have an adverse effect on the pace at which the current or any future developers in the District can complete the remaining infrastructure and future homes, and demand by, and the ability of individuals to purchase homes within the District. Such events and factors could include rising inflation and interest rates, persistent supply chain issues and global market instability caused by geopolitical events. Any adverse impact of the foregoing and other economic factors on the project in the District and the real estate market in general cannot be predicted.

Natural Disasters
The District, like all California communities, may be subject to unpredictable seismic activity, fires, floods, or other natural disasters. Southern California is a seismically active area. Seismic activity represents a potential risk for damage to buildings, roads, and property within the District. In addition, land susceptible to seismic activity may be subject to liquefaction during the occurrence of such event. The property within the District is located in a Fault -Rupture Hazard Zone (formerly referred to as an Alquist-Priolo Special Study Zone), as defined by Special Publication 42 (revised January 1994) of the California Department of Conservation, Division of Mines and Geology. The District is located approximately 1.3 miles southwest of the Banning Fault and 3.1 miles northwest of the San Gorgonio Pass Fault. The District is not located in a flood plain area.

In recent years, wildfires have caused extensive damage throughout the State. In some instances, entire neighborhoods have been destroyed. Several of the fires that occurred in recent years damaged or destroyed property in areas that were not previously considered to be at risk from such events. Some commentators believe that climate change will lead to even more frequent and more damaging wildfires in the future. Additionally, wildfires increase the risk of mudslides in areas like the District that are surrounded by hillsides. In general, property damage due to wildfire or mudslides could result in a significant decrease in the market value of property in the District and in the ability or willingness of property owners to pay Special Taxes.

Western Riverside County, in which the District is located, has previously experienced large-scale wildfires that resulted in the destruction of homes and businesses. According to the City's Municipal Code, which incorporates portions of the County's Ordinance 787 and the California Fire Code by reference, the District is not located in a Very High Fire Hazard Severity Zone. More information regarding Fire Hazard Severity Zones, including the most recent Fire Hazard Severity Zone Maps, can be found at the California Depaitiuent of Forestry and Fire Protection website at http://frap.fire.ca.gov/index , though such website is not incorporated herein by reference. Homeowner's insurance is available to property owners within the District, and the coverage provided by such insurance typically insures against fire damage, although there is no assurance that homeowners within the District will purchase or maintain such insurance.

In the event of a severe earthquake, fire, flood or other natural disaster, there may be significant damage to both property and infrastructure in the District. As a result, a substantial portion of the property owners may be unable or unwilling to pay the Special Taxes when due. In addition, the value of land in the District could be diminished in the aftermath of such a natural disaster, reducing the resulting proceeds of foreclosure sales in the event of delinquencies in the payment of the Special Taxes.

Hazardous Substances
While government taxes, assessments and charges are a common claim against the value of a parcel, other less common claims may also be relevant. One of the most serious in terms of the potential reduction in the value of a parcel is a claim with regard to a hazardous substance. In general, the owners and operators of a parcel may be required by law to remedy conditions relating to releases or threatened releases of hazardous substances. The federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, sometimes referred to as "CERCLA" or the "Super Fund Act," is the most well-known and widely applicable of these laws, but California laws with regard to hazardous substances are also stringent and similar in effect. Under 44 4861-1693-0704v5/022599-0026

many of these laws, the owner (or operator) is obligated to remedy a hazardous substance condition of a parcel whether or not the owner (or operator) had anything to do with creating or handling the hazardous substance.

The effect, therefore, should any of the parcels within the District be affected by a hazardous substance, is to reduce the marketability and value by the costs of remedying the condition.

The District is not aware of the presence of any federally or state classified hazardous substances in violation of any environmental laws, located on the property within the District. However, it is possible that such materials do currently exist and that the District is not aware of them.

It is possible that property in the District may be liable for hazardous substances in the future as a result of the existence, currently, of a substance presently classified as hazardous but which has not been released or the release of which is not presently threatened, or the existence, currently, on the property of a substance not presently classified as hazardous but which may in the future be so classified. Additionally, such liabilities may arise not simply from the existence of a hazardous substance but from the method of handling such substance.

All of these possibilities could have the effect of reducing the value of the applicable property.

Direct and Overlapping Indebtedness
The ability of an owner of property within the District to pay the applicable Special Taxes could be affected by the existence of other taxes and assessments imposed upon taxable parcels. See "THE COMMUNITY FACILITIES DISTRICT — Direct and Overlapping Debt" herein. The City and other public agencies whose boundaries overlap those of the District could impose additional taxes or assessment liens on the property within the District in order to finance public improvements or services to be located or provided inside of or outside of such area. The lien created on the property within the District through the levy of such additional taxes may be on a parity with the lien of the Special Taxes applicable to the property within the District.

The imposition of additional liens on a parity with the Special Taxes may reduce the ability or willingness of property owners to pay the Special Taxes and increase the possibility that foreclosure proceeds will not be adequate to pay delinquent Special Taxes.

Payment of the Special Tax is not a Personal Obligation of the Property Owners An owner of a taxable parcel is not personally obligated to pay Special Taxes. Rather, Special Taxes are an obligation which is secured only by a lien against the taxable parcel. If the value of a taxable parcel is not sufficient, taking into account other liens imposed by public agencies, to secure fully Special Taxes, the District has no recourse against the property owner.

Property Values
The value of the property within the District is a critical factor in determining the investment quality of the Bonds. If a property owner is delinquent in the payment of Special Taxes, the District's only remedy is to commence foreclosure proceedings against the delinquent parcel in an attempt to obtain funds to pay the Special Taxes. Reductions in property values due to a downturn in the economy, physical events such as earthquakes, fires or floods, stricter land use regulations, delays in development or other events will adversely impact the security underlying the Special Taxes. See "THE COMMUNITY FACILITIES DISTRICT —Value -to -Lien Ratios."
The Appraiser has estimated, on the basis of certain definitions, assumptions and limiting conditions contained in the Appraisal Report that as of November 1, 2023, the value of the Taxable Parcels within the District was $240,762,396. The Appraisal Report is based on a number of assumptions and limiting conditions as stated in APPENDIX H —"APPRAISAL REPORT." The Appraisal Report does not reflect any possible negative impact which could occur by reason of future slow or no growth voter initiatives, an economic 45 4861-1693-0704v5/022599-0026

downturn, any potential limitations on development occurring due to time delays, an inability of any landowner to obtain any needed development approval or permit, the presence of hazardous substances or other adverse soil conditions within the District, the listing of endangered species or the determination that habitat for endangered or threatened species exists within the District, or other similar situations.

Prospective purchasers of the Bonds should not assume that the land and improvements within the District could be sold for the amount stated in the Appraisal Report at a foreclosure sale for delinquent Special Taxes. In arriving at the estimate of market value of the Appraised Property in the Appraisal Report, the Appraiser assumes that any sale will be sold in a competitive market after a reasonable exposure time, and assuming that neither the buyer or seller is under duress, which is not always present in a foreclosure sale. See APPENDIX H —"APPRAISAL REPORT" for a description of other assumptions made by the Appraiser and for the definitions and limiting conditions used by the Appraiser. Any event which causes one of the Appraiser's assumptions to be untrue could result in a reduction of the value of the land within the District from that estimated by the Appraiser.

The assessed values set forth in this Official Statement do not represent market values arrived at through an appraisal process and generally reflect only the sales price of a parcel when acquired by its current owner, adjusted annually by an amount determined by the County Assessor, generally not to exceed an increase of more than 2% per fiscal year. No assurance can be given that a parcel could actually be sold for its assessed value.

No assurance can be given that any bid will be received for a parcel with delinquent Special Taxes offered for sale at foreclosure or, if a bid is received, that such bid will be sufficient to pay all delinquent Special Taxes. See APPENDIX D —"SUMMARY OF CERTAIN PROVISIONS OF THE BOND INDENTURE — COVENANTS AND WARRANTY —Covenants —Commence Foreclosure Proceedings." Parity Taxes and Special Assessments
Property within the District is subject to taxes and assessments imposed by other public agencies also having jurisdiction over the land within the District. See "THE COMMUNITY FACILITIES DISTRICT — Direct and Overlapping Indebtedness."
The Special Taxes and any penalties thereon will constitute a lien against the lots and parcels of land on which they will be annually imposed until they are paid. Such lien is on a parity with all special taxes and special assessments levied by other agencies and is co -equal to and independent of the lien for general property taxes regardless of when they are imposed upon the same property. The Special Taxes have priority over all existing and future private liens imposed on the property except, possibly, for liens or security interests held by the Federal Deposit Insurance Corporation. See "—Bankruptcy and Foreclosure." Neither the District nor the City has control over the ability of other entities and districts to issue indebtedness secured by special taxes, ad valorem taxes or assessments payable from all or a portion of the property within the District. In addition, the landowners within the District may, without the consent or knowledge of the District, petition other public agencies to issue public indebtedness secured by special taxes and ad valorem taxes or assessments. Any such special taxes or assessments may have a lien on such property on a parity with the Special Taxes and could reduce the estimated value -to -lien ratios for the property within the District described herein. See "SOURCES OF PAYMENT FOR THE BONDS" and "THE COMMUNITY FACILITIES DISTRICT —Direct and Overlapping Indebtedness" and "THE COMMUNITY FACILITIES DISTRICT —Value-to-Lien Ratios."
Disclosures to Future Purchasers
The willingness or ability of an owner of a parcel to pay the Special Tax even if the value is sufficient may be affected by whether or not the owner was given due notice of the Special Tax authorization at the time the owner purchased the parcel, was informed of the amount of the Special Tax on the parcel should the Special 46 4861-1693-0704v5/022599-0026