Agenda, first session — Fairfield City Council, October 15, 2024 (part 2 of 4)

PASSED AND ADOPTED this 15th day of October 2024, by the following vote:

AYES: MEMBERS: MOY/BERTANI/CARR/PANDURO/TONNESEN/VACCARO/WILLIAMS NOES: MEMBERS: _________________________________________________ ABSENT: MEMBERS: _________________________________________________ ABSTAIN: MEMBERS: _________________________________________________

_________________________________________________
MAYOR
ATTEST:
___________________________

CITY CLERK

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Agenda Item No: 10.

AGENDA REPORT
DATE:October 15, 2024
TO:Mayor and City Council
FROM:David Gassaway, City Manager
SUBJECT:Resolution 2024249 of the City Council of the City of Fairfield Demonstrating Compliance with State Housing Laws Related to Surplus Lands, Accessory Dwelling Units, and Density Bonus
RECOMMENDED ACTION
Adopt resolution.

STATEMENT OF ISSUE
The Metropolitan Transportation Commission (MTC) awarded the City funds for various projects through Cycle 3 of the One Bay Area Grant (OBAG) program. MTC requires the City to selfcertify compliance with certain State housing laws. The proposed resolution provides this certification.

DISCUSSION
MTC administers a wide range of funding for transportationrelated actions in the San Francisco Bay Area. An example of this funding is the OBAG program. OBAG establishes the policy framework and commitments for investing in various federal funding sources available to MTC. Under OBAG, MTC provides funding grants to Bay Area jurisdictions for a wide range of eligible transportationrelated projects. To date, MTC has administered multiple fiveyear cycles of OBAG grants and is now in the third cycle (OBAG 3).

Under OBAG 3, Fairfield has received grant funding for three projects. These include:

Linear Park Node 4 Safe Routes to School and Transit project Travis Safe Routes to Scholl and Transit project
Fairfield/Solano Transportation Authority Solano Rail Hub project As a condition of receiving grant funds, MTC requires the City to provide a commitment to comply with three sets of housing laws. These include the Surplus Lands Act, the law pertaining to Accessory Dwelling Units (ADUs) and junior ADUs, and the state’s Density Bonus Law. The attached resolution, based on a model provided by MTC, makes these commitments. The City previously committed to complying with the Surplus Land Act for the OBAG 2 cycle (see resolution 201750). The proposed resolution reiterates that earlier commitment and adds the required commitments regarding ADU law Packet Page 103 of 530

Agenda Item No: 10.AGENDA REPORTDATE:October 15, 2024 TO:Mayor and City CouncilFROM:David Gassaway, City ManagerSUBJECT:Resolution 2024249 of the City Council of the City of Fairfield DemonstratingCompliance with State Housing Laws Related to Surplus Lands, Accessory DwellingUnits, and Density BonusRECOMMENDED ACTIONAdopt resolution.STATEMENT OF ISSUEThe Metropolitan Transportation Commission (MTC) awarded the City funds for various projectsthrough Cycle 3 of the One Bay Area Grant (OBAG) program. MTC requires the City to selfcertifycompliance with certain State housing laws. The proposed resolution provides this certification.DISCUSSIONMTC administers a wide range of funding for transportationrelated actions in the San Francisco BayArea. An example of this funding is the OBAG program. OBAG establishes the policy framework andcommitments for investing in various federal funding sources available to MTC. Under OBAG, MTCprovides funding grants to Bay Area jurisdictions for a wide range of eligible transportationrelatedprojects. To date, MTC has administered multiple fiveyear cycles of OBAG grants and is now in thethird cycle (OBAG 3). Under OBAG 3, Fairfield has received grant funding for three projects. These include:Linear Park Node 4 Safe Routes to School and Transit projectTravis Safe Routes to Scholl and Transit projectFairfield/Solano Transportation Authority Solano Rail Hub projectAs a condition of receiving grant funds, MTC requires the City to provide a commitment to comply withthree sets of housing laws. These include the Surplus Lands Act, the law pertaining to AccessoryDwelling Units (ADUs) and junior ADUs, and the state’s Density Bonus Law. The attached resolution, based on a model provided by MTC, makes these commitments. The City previously committed to complying with the Surplus Land Act for the OBAG 2 cycle (see resolution 201750). The proposed resolution reiterates that earlier commitment and adds the required commitments regarding ADU law and the Density Bonus Law. This commitment is in line with standard city practices. Notably, the City periodically amends its code to ensure consistency with state housing laws and applies its code accordingly. Further demonstrating our commitment to these laws, the City received a “ProHousing” designation from the state earlier this year.

FINANCIAL IMPACT
Adopting the resolution will have no financial impact to the City. However, if it is not adopted by December 31, 2024, the City will forfeit its OBAG 3 funds for the abovelisted projects. Together, the three projects receive grant allocations totaling $6,399,000.

PUBLIC CONTACT/ADVISORY BODY RECOMMENDATION
N/A
ALTERNATIVE ACTION
The council may choose to not adopt the resolution. As noted, this would result in the City forfeiting $6,399,000 in grant funds.

STAFF CONTACT
Dave Feinstein, Planning Division Manager
(707) 4287448
[email protected]
COORDINATED WITH
Public Works Department
ATTACHMENTS:

Description
Proposed Resolution
REVIEWERS:

Reviewer Action Date
Zellers, David Approved 9/30/2024 10:49 AM
Beavers, Esther Approved 9/30/2024 10:59 AM
Beavers, Esther Approved 9/30/2024 11:02 AM
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CITY OF FAIRFIELD

RESOLUTION NO. 2024-249

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FAIRFIELD DEMONSTRATING

COMPLIANCE WITH STATE HOUSING LAWS RELATED TO SURPLUS LANDS, ACCESSORY

DWELLING UNITS, AND DENSITY BONUS

WHEREAS, the San Francisco region has the highest housing costs in the United States; and

WHEREAS the Bay Area produced less than 30% of the need for low- and moderate-income housing units from 2007-2014, and underproduced low-income units during 2015-2023; and

WHEREAS, there are limited funding sources available to secure land for the construction of low- and moderate-income housing; and

WHEREAS, public lands can play a critical role in increasing the supply of land for affordable housing;

WHEREAS, Accessory Dwelling Units (ADUs) and Junior Accessory Dwelling Units (JADUs) provide an important option to increase the availability and affordability of housing, especially in existing, lower-density neighborhoods; and

WHEREAS, density bonuses are an effective tool to increase the financi al feasibility of housing and incentivize the creation of affordable housing; and

WHEREAS, the Metropolitan Transportation Commission adopted Resolution No. 4505, outlining the One Bay Area Grant Program's programming policy and project selection criteria, including certain requirements to access these funds.

NOW, THEREFORE, THE COUNCIL OF THE CITY OF FAIRFIELD HEREBY RESOLVES:

Section 1. The City agrees to comply with the terms of the Surplus Land Act (California Government Code § 54220 et seq.), as exists now or may be amended in the future, including, but not limited to, AB 1255 (Rivas, 2019), which requires jurisdictions to compile and report annually an inventory of surplus lands to the California Department of Housing and Community Development.

Section 2. The City agrees to comply with state laws related to ADUs and JADUs, as they exist now or may be amended in the future, including, but not limited to California Government Code §§ 65852.150, 65852.2, 65852.22, et seq. and California Health & Safety Code §§ 17980.12.

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RES. NO. 2024-249

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Section 3. The City agrees to comply with the state Density Bonus Law (California Government Code § 65915 et seq.) as it exists now or may be amended in the future.

Section 4. The City warrants and represents that it is in compliance with the aforementioned state housing laws, and there are no claims, actions, suits, or proceedings pending, to the best of the City’s knowledge, alleging violations of the state housing laws by Fairfield.

PASSED AND ADOPTED this 15th day of October 2024, by the following vote:

AYES: MEMBERS: MOY / BERTANI / CARR /PANDURO / TONNESEN/ VACCARO / WILLIAMS

NOES: MEMBERS:

ABSENT: MEMBERS:

ABSTAIN: MEMBERS:

______________________________________________________
MAYOR

ATTEST:

____________________________

CITY CLERK

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Agenda Item No: 11.

AGENDA REPORT
DATE:October 15, 2024
TO:Mayor and City Council
FROM:David Gassaway, City Manager
SUBJECT:Resolution 2024250 of the City Council of the City of Fairfield Approving and Authorizing the Execution of the Grazing License Between the City of Fairfield, the County of Solano, and Pacific Livestock, Inc. for the Approximately 288Acre Property Commonly Known as the Wilcox Triangle Property Located in Solano County, California RECOMMENDED ACTION
Adopt resolution.

STATEMENT OF ISSUE
The City of Fairfield and Solano County (County) are joint property owners of the 1,858acre lands known as Wilcox Ranch, which includes Wilcox Ranch Triangle, 288 acres, and Wilcox West, 1,570 acres adjacent to the western runway of Travis Air Force Base (Property) and are requesting approval to enter into a grazing license with Pacific Livestock, Inc. (Pacific Livestock).

The General Plan designates the Property as Travis Reserve, which strictly limits development of the Property to reserve it for future Base expansion. However, cattle grazing is recognized as a management tool for the protection, maintenance, and enhancement of habitat values on the Property.

DISCUSSION
The City and the County signed a lease agreement with Pacific Livestock in 2003 (Original Lease) for the purpose of granting Pacific Livestock the right to graze on the Property. The Nature Conservancy has a deed restriction on the property, which only allows it to be used for grazing. Pacific Livestock has continued to graze on the Property uninterrupted since 2003. The City and the County agreed that the Original Lease rent and terms should be updated using a Grazing License Agreement. The City drafted a new agreement (Grazing License) for three grazing seasons through June 15, 2026, with an annual rental rate of $6,762.24 with an annual increase of 3%.

The County reviewed, approved, and executed the Grazing License. Pacific Livestock has agreed to the terms of the Grazing License. The Original Lease will automatically terminate upon the effective date of the Grazing License.

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Agenda Item No: 11.AGENDA REPORTDATE:October 15, 2024 TO:Mayor and City CouncilFROM:David Gassaway, City ManagerSUBJECT:Resolution 2024250 of the City Council of the City of Fairfield Approving andAuthorizing the Execution of the Grazing License Between the City of Fairfield, theCounty of Solano, and Pacific Livestock, Inc. for the Approximately 288Acre PropertyCommonly Known as the Wilcox Triangle Property Located in Solano County, CaliforniaRECOMMENDED ACTIONAdopt resolution.STATEMENT OF ISSUEThe City of Fairfield and Solano County (County) are joint property owners of the 1,858acre landsknown as Wilcox Ranch, which includes Wilcox Ranch Triangle, 288 acres, and Wilcox West, 1,570acres adjacent to the western runway of Travis Air Force Base (Property) and are requesting approvalto enter into a grazing license with Pacific Livestock, Inc. (Pacific Livestock).The General Plan designates the Property as Travis Reserve, which strictly limits development of theProperty to reserve it for future Base expansion. However, cattle grazing is recognized as amanagement tool for the protection, maintenance, and enhancement of habitat values on the Property. DISCUSSIONThe City and the County signed a lease agreement with Pacific Livestock in 2003 (Original Lease) forthe purpose of granting Pacific Livestock the right to graze on the Property. The Nature Conservancyhas a deed restriction on the property, which only allows it to be used for grazing. Pacific Livestock hascontinued to graze on the Property uninterrupted since 2003. The City and the County agreed that theOriginal Lease rent and terms should be updated using a Grazing License Agreement. The City drafteda new agreement (Grazing License) for three grazing seasons through June 15, 2026, with an annualrental rate of $6,762.24 with an annual increase of 3%.The County reviewed, approved, and executed the Grazing License. Pacific Livestock has agreed tothe terms of the Grazing License. The Original Lease will automatically terminate upon the effective date of the Grazing License.

FINANCIAL IMPACT
The City will collect rent in the amount of $6,762.24 annually, with 3% annual increases, to be deposited into the City’s Wilcox Ranch Grazing Agreement Trust Deposits fund (Fund 561, Organization Code 99000) which the City holds. The rent collected cannot be used for any other purpose than to maintain and make needed repairs on the Property.

PUBLIC CONTACT/ADVISORY BODY RECOMMENDATION
N/A
ALTERNATIVE ACTION
The City Council may choose to modify the proposed Grazing License.

STAFF CONTACT
Jennifer Rice, Real Estate Specialist II
(707) 4287727
[email protected]
COORDINATED WITH
N/A
ATTACHMENTS:

Description
Proposed Resolution
Proposed Grazing License
REVIEWERS:

Reviewer Action Date
Zellers, David Approved 10/1/2024 12:05 PM
Beavers, Esther Approved 10/1/2024 4:10 PM
Beavers, Esther Approved 10/1/2024 4:10 PM
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CITY OF FAIRFIELD

RESOLUTION NO. 2024-250

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FAIRFIELD APPROVING AND

AUTHORIZING THE EXECUTION OF THE GRAZING LICENSE BETWEEN THE CITY OF FAIRFIELD, THE COUNTY OF SOLANO, AND PACIFIC LIVESTOCK, INC. FOR THE APPROXIMATELY 288-ACRE

PROPERTY COMMONLY KNOWN AS THE WILCOX TRIANGLE PROPERTY LOCATED IN SOLANO

COUNTY, CALIFORNIA

WHEREAS, the City of Fairfield and Solano County (County) are joint property owners of the 1,858-acre lands known as Wilcox Ranch, which includes Wilcox Ranch Triangle, 288 acres, and Wilcox West, 1,570 acres (Property) adjacent to the western runway of Travis Air Force Base (Base); and

WHEREAS, the General Plan designates the Property as Travis Reserve, which strictly limits the development of the Property to reserve it for future Base expansion; and

WHEREAS, cattle grazing is recognized as a management tool for the protection, maintenance, and enhancement of habitat values on the Property; and

WHEREAS, Pacific Livestock, Inc. signed a lease agreement in 2003 (Original Lease) to graze an approximately 288-acre portion of the Property known as the Wilcox Triangle Property for a period of three years with an automatic renewal for consecutive one-year terms until such time that either party terminated the Original Lease; and

WHEREAS, in 2021, the City, the County, and Pacific Livestock entered into a new three-year Grazing License for the purpose of updating the language and including annual rent increases ; and

WHEREAS, Pacific Livestock, Inc., the City, and the County want to enter into a new agreement (Grazing License) effective June 16, 2024, through June 15, 2026; and

WHEREAS, the County and Pacific Livestock, Inc. have reviewed, approved, and executed the Grazing License.

NOW, THEREFORE, THE COUNCIL OF THE CITY OF FAIRFIELD HEREBY RESOLVES:

Section 1. The City Council hereby approves the Grazing License by and between the City of Fairfield, the County of Solano, and Pacific Livestock, Inc. for the Property, as attached hereto, with minor or clarifying revisions as may be approved by the city attorney.

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RES. NO. 2024-250

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Section 2. The city manager or designee is hereby authorized to do all things necessary and proper to implement the above-mentioned transaction including executing any documents needed to manage and maintain the Property.

PASSED AND ADOPTED this 15th day of October 2024, by the following vote:

_________________________________________________
MAYOR
ATTEST:
___________________________

CITY CLERK

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Grazirrg Licens+' Wlcox RancltJune 2024Page 1 of 13GRAZING L.ICENSE(Delta Project - Wilcox Ranch (Westem Portion))This GftfiZING LICENSE (the "Liconse"), dated as of -,2024,isby and between THE CITY OF FAIRFIELD AND THE COUNW OF SOLANO'(,;Licensot€"), and PACIFIC LIVESTOCK, lNC., a California corporation ("Licenaee")RECITALSA. Licensors are the joint owners of that certain real propertycomprised of approximately two hundred eighty-eight (288) acres that 1e located inSolano County, balifornia, and is more particularly described on Exhibit A (the"Trian gle Property" or "Property").B. The Triangle Property was purchased by Licensors and is managedby Licensors, for the purposeJof allowing future expansion of Travis Air Force Base. lnlie interim periorJ, the Triangle Property is to be utiliz.od for tlre grazing of livestock asidentified and regulated within the deed restrictions recorded against the propefi andcontained herein on Exhibit B.c, cattle grazing on the Triangle Property is recognized as abeneficial management tooifor thb protection, maintenance, and enhancement of thehabitat values of tlre Triangle Property.D. Licensor desires to grant a license of the Triangle Property (notincluding any structures loceted thereon) to l-icensee, and Licensee desires to obtain alicense of tfrl Triangle Property (not including any structures located thereon) for thesole purpose of graling cattle pursuant to the terms and conditions of this License.NOW, THEREFORE, in consi.Jeration of the mutual covenants set lbrth herein,Licensors hereby agree to license tne'friangle Property to Licensee solely for thepurpose of grazing cattte on the Property and subject to the terms and conditions setforth below.1. Liciense: Descrigtjgn-9!-P3gledlt Licensors, for and in consideration ofthe fees, cgvenantg and a@ments hereinafter regerved and contained on the partand behalf of Licensee to ti paid, kept, and partonried, does hereby gralt a licenseurrto said Licensee and Licensee hereby licenses from Licensors, approximately twohundred eightlr-gig6t (288) acres of pasture land situated, lying and being in the Countyof Solano, Staie o1California, more commonly known as the Wilcox Ranch Triangle.property, as shown on Exhibit A attached hereto and incorporated by reference(heieiniftor, the "Properfi-Licensee shall do allthings reasonable to adhere to thedeed restrictions contained in Exhibit B.1Packet Page 111 of 530Attachment 2 Page 1 of 26

Grazlng License- \Mlcox RanchJune2024Page 2 of 13fi Term. The initlal temi of this License is for a period of three "GrazingSeasons,o-'cqmmencing on June 16; 202q and expiring on June 15, 2026, unless soonerterminated as hereinaftLr provideO. fne "Grazipg Season'shallgenerally run fromOctober 1S tfirough June i 5 of each year. There shall be no grazing permitted on theProperty tront .luie 16 to October 14 of each year. Licensors and Licensee each shallfravb ttri right to terminate this License for either party's sole convenience at any timeduring the term by giving twelve (12) months written notice to the other ("TerminationNotic6"), hnd thertlafter the License shall terminate upon the last day of the GrazingSeason following the expiration of tre 12-month period after the Termination Notice (the"License Terminltion Date'). Any holding over by Licensee following the LicenseTermination Date shall not constitute a renewat of this License or give Licensee rightsunder this License in or to the Property.The License may also be terminated as provided in subsection (C) of Section 5.3. License Fee. Licensee agrees to pay Licensors an annualfee eachGrazing Season, or portion th'ereol that falls within the Term (the'Annual LicenseFee'). The initialAnnual License Fee is Twenty-Three Dollars and 48/100 ($23.48) peracre for a total of Six Thousand One Hundred Eighty-Nine Dollars and 97/100($6,762.24). The Annual License Fee will automatically incre4se by three percent (3%)iach year on May 1{ for the entire Term of the License, including any extensions.The Annual License Fee shall be payable in equalquarterly payments (the "QuarterlyFee Payments") that shall be payable in advance, on or before aach October 1,January 1, April i, and July 1 during the Term of the License, Each Quarterly Feeeayment and any other payment due to Licensors under this License, shall be payable,Without deduction or offset, and shall be submitted to Licensors at City of Fairfleld'1000 Webster Street, 2nd Floor, Falrfield, Callfornia 94633, Attention: JenniferRice, Real Estate Specialist.License Fee beginning each MaY 1,Per Acre Annual Fee2024 $23.48 $6,762.242025 $24.18 $6'963.84202? $24.e1 $7'174,08lf any payment due under this License, including, without limitation, any portion of anyAnnual License Fee or any Quarterly Fee Payment, has not been received by Licensorson or before the date whiin shall be ten (10) days immediately following the date suchpayment is due, Licensors may assess interest on such overdue amount, at the rate ofien p"r""nt (10%) per annum (or the maximum rate permitted by applicable law, if less)for t'he period commencing on ihe date such overdue amount was due and terminatingon the date such overduelmount is paid in full by Licensee. To the extent that anypayment made under this License exceeds the maximum amount of interest chargeable2Packet Page 112 of 530Attachment 2 Page 2 of 26

Grazing Licenso- \Mlcox RanchJune2024Page 3 of 13under applicable law, the amount of such excess payment shall be deemed to be, andshall be ipplied to, rent or other amounts due or to become due under this License.4, Use of Licensed Propertv. The Property shall be used by Licensee solelyforthetottowl@gofcattleduringtheTerminstrictaccordancewith the terms inO ionOitions of this License, (b) the construction, operation, repair,maintenance and replacement of minor non-residential and non-habitableimprovements which are specifically related to the permifted grazing activities that areconducted on the Property, such as fences, corrals, troughs and windmills,(cJ ternporary resideniial uses that are associated with or incidental to the permittedirband adivities conducted on the Property and that do not involve the construction ofiny im-provements on the Property; provided, that Licensors shall have approved inadvance the following respeciing iuch temporary structures: (i) the loca.tion on theproperty of such temporary struitures, (ii) the individuals inhabiting such temporarystructurLs, and (iii) th; tim; periods for inhabiting such temporary structures, and (d)such other uses that are expressly permitted in this License. Licensee shall not bepermitted to graze any animals other than cattle on the Property under this License,btf,er than thl u."r "nd activities expressly permitted in this License, no use or activity.n"ff O" permitted on the Property wiihout first obtaining the prior written ap.proval ofLicensors, which approval miy bb granted or withheld in the sole and absolutediscretion of Licensors.Licensee may refrain from using all or arry portion of the Property during any period(s)of the Term, provided that therJshatl be no reduction in or offset of any Annual LicenseFee or any euarterly Fee payments due for such period of nonuse and the obligations'of Licensee set forth in this License shall remain in full force and effect during suchperiod(s) of nonuse.Licensee shall have the right to use only those waters and water rights which areappurtenant to the Property and are reasonably ne@ssary in conneclion withLicensee's grazing operations permitted under this Lic,ense; provided, that.Licenseeshall not be entitled to use any water on the Property or water rights appurtenant to theproperty to convert the property or any portion thereof from its existing condition of non-irrigated pasture to irrigated paiture. ft lnatt be Licensee's sole responsibility to divertani jppfi, water for an-y and all of Licensee's grazing activities permitted under thisLicense, Licensee shiil have no right to use iny water at a location other than on theProperty, nor convey any water or water rights to any other party, fol.ny use orpurpose.- Licensee itratinot sell any water located on or under the Property or anyivatet rights appurtenant to or associated with the Proper$ during the Term.5. Grazino Reouirements.A. All grazing operations conducted by Licensee under thisLicense shall be conducted in accordance with the best course of animal husbandrypracticed in Solano County and the general surrounding vicinity and subject to thespecific limitations and requirements expressly included in this License.a3Packet Page 113 of 530Attachment 2 Page 3 of 26

Grazing License- Wlaox RanchJune 2024Page 4 of 13B. lf any of Licensee's cattlo migrates on to any propertythat is not subject to thls License or to any other License between Licensors andLicensee, Licensee shall remove such cattle from such property within three (3) days ofLicensee;s discovery of same. Licensee shall repair, at Licensee's sole cost andexpense, any damage to the Property or to adjacent lands which is caused byLicensee's violation bt tne grazing standards set forth in this License or any otherprovision of this License or the encroachment of Licensee's cattle onto any landsadjacent to the Property.C. Licensee understands the Property is encumbered bycertaindeedreshictlons,whicharedetailedintheformattachedheretoas@and incorporated herein by reference (the "Deed Restrictions"), and which is recordedin the Official Records of Solano County. Licensee hereby acknowledges and agrees tothe following: (i) Licensee has reviewed and fully unclerstands, and shallfully complywith all of th-e terms, conditions and provisions of the Deed Restrictions with respect toany and all of the activities and uses conducted by Licensee on the Property during theeniire Term of the License; (ii) Licensee further understands that the Licensor8 may'prior to expiration of the Term, sell or transfer allor a portion of the Property to theiederal government of the United States of America, or any departnent or branchthereof {collectively, "USA"), for the purpose of using the Property, or portio_ns thereof,to expancl the air installation facilities comrnonly known as Travis Air Force Base.Following any such sale or transfer of the Property, or portions thereof, to USA, USAshall havl thl right to terminate this Licsnse upon the expiration of any Grazing Seasonby delivering to ticensee written notice of termination at least three hundred sixty-five(365) days in advance of the expiration of suc,tr Grazing Season.D. Licensors and Licensee understand that, due to a varietyof reasons, including the palatability of certain areas of the Property and the proximity ofvarious areas of thJProperty to water, certain areas of the Property willbe grazeddifferenlly at different times which may result in some isolated areas of the Proper$having more or less forage than otherareas. Recognizing these norm-alvariances,Liceniee shall maintain not less than an average of seven hundred (700) pounds peracre residual herbaceous dry matter ("RDM") on and throughout the Property at alltimes during the Term. RDM levels may be monitored by Licensors or Licensors'agents duriig the Term, and by The Nature Conservancy on an annual basis inaicordance witn tne terms of the Deed Restrictions. ll during the Term, Licenseebecomes aware, whether independently or upon Licensors' or The NatureConservancy's notification of Licensee, that RDM levels on all or any material portion ofthe Propertyare nearing minimum allowable amounts, Licensee shall consult withLicensors wlttrin seven iZ) Oays regarding appropriate corrective actions for Licensee totake to return such portions to allowable RDM amounts. Appropriate correclive actionsmay include moving cattle within the Property, removing cattle from such affectedporiions of the Proferty, or taking such othei husbandry practices that Licensors andLicensee may agree to mitigate 6r correct for the potentialdiminishment of RDM levelswithin the affected portion ol ttre Property. All costs shall be responsibility of Licensee'4Packet Page 114 of 530Attachment 2 Page 4 of 26

Grazlng License- Wlcox RanchJune 2024Page 5 of 13E. Licensors and Licensee recognize that certain eventsunrelated to grazing, including, without llmitation, fires, insect invasions (e-9.grasshopp"ril, dro-ughts andLxcessive rainfall, may affect the variety and densi$ offirage boih on tlre giasslands portion of the Property and within the vernal poolslocaied on the Proplrty. lt is the desire of Licensors and Licensee to adjust grazingpatterns on the Property in the event of the occurrence of any such unusual event inorder to assure thai neiiher overgrazing or undergrazing occurs on the Property andthat the long term health of both the grasslands and vemal pools on the Property aremaintainedln a manner that will sustain both the grazing practices on the Property andthe habitat values associated with the Property'F. The use of supplemental livestock feed and forage,whether by importing hay or other feed onto the Property or horticulturally introducingnon-native fomge plint riraterial on the Property, shall be prohibited; provided that theuse of salt licks and nutritional supplements such as vitamins shall be permitted as longas such items are not located or placed within one hundred (100) yards of anypermanent water Source or perennialwater sourc€ or vernal pool.G. The application of fertilizers (including, without limitation,biosolids) and herbicides shall be prohibited on the Property, except for the. targetedapplication of herbicides to controitne spread of non-native plants and noxious weedsin ihose areas of the Property where there has been an outbreak of non-natlve plantsand noxious weeds whicir has been approved in advance by Licensors; provided,further, that in no event shall herbicides be used in any of the vernal pools existing ontlre Property.H. All cattle grazing activities on the Property shall besubject to all cunent and future restrictions imposed under the United StatesEndangered Species Act (16 U.S.C. Section 1531 ef. seg.) (the "Acf'). Licenseeundersiands that, as the agency with primary responsibility for overseeing the Act, theU.S, Fish and Wiidtite Service mav impose future limitations or restrictions respectingthe length of grazing seasons and permissible stocking rates, and may prohibit grazingactivitids on p-ortioni of the Property; provided, however, if USFWS imposes futuregrazing limitations which materially-impact the grazing rights permitted.underthislicensl, Licensors and Licensee inatt mutually agree on an appropriate reduction in theAnnual License Fee and associated Quarterly Fee Payments that shall take suchgrazing limitations into account.6. Records. Licensee shall deliver to Licensors, on or before January 30,April 30 anO ,l@, a written report setting forth the aggregate number and location ofail cat6e grazed on irre property during the immediately preceding calendar quarter (the,,euarteity Reporf'). fni Oirarterly Report delivered by Licensee pursuant to thisSectionoinatt'ueintheformattachedheretoas@andincorporatedhereinbyreference,T. .HazarOous SuUsta , The use of biocides, herbicides, insecticides, or5Packet Page 115 of 530Attachment 2 Page 5 of 26

Grazing Lioense- ll\rllcox RanchJune2O24Page 6 of 13other agrichemicals on the Properg shall be prohibited unless Licensee receives thewritten ipprovat of Licensors to use such substances on the Property prior to such use,which approval may be granted or withheld in Licensors'sole and absolute discretion.A1 suctrihemicals or substances which Licensee may apply or allow to be applied tothe Property shall be used and applied at Licensee's sole cost, risk and liability, andLicensee shall indemnify, defend and hold harmless Licensors and Llcensors' members,directors, officers, employees, agents and contractors and their heirs, successors andassigns against and from any and all claims, losses or liabilities of whatever nature,whic-h in a-ny manner arise out of or resuh from any use or application of any of suchsubstances by Licensee.Licensee shall not release or permit the release of any pollutrant, contaminant, waste,chemical, regulated substance, hazardous substance, petroleum-based substance,toxic substance or hazardous material, whlch are, or are designated as, or are subjectto regulation as, hazardous, toxic, harmful or dangerous, under any federal, state orlocal-law, statute, regulation or ordinance ('Laws') (collectively, "HazardousMaterials") in a rnanner which endangers human health, welfare, or the environment orthat could cause any person to incur any cost or liability for investigation or cleanup'Nor shall Licensee use or permit the Property to bo used in any manner for theproduction, recycling, treaiment or disposalof any Hazardous Material. Licensee shallnot bring onto tire Pioperty or allow to be brought onto the Property any storage tant,either under or above ground, that contains any Hazardous Material, nor any materialcontaining or proctucin6 ,ny polychlorinated biphenyl's, dioxins or asbestos. At alltimesduring th; Te;m, Licenlee ihall strictly comply with any and all Laws govemlng theoper"lion, creation, management, use, handling, release, treatment, transportation'riorrg", generation or disposal of Hazardous Materials and/or relating to environmentalproteitioi, including specifically, without limitation, the Comprehensive Environmentalitesponse, Compensation and-Liability Act,42 U.S.C. S 9601 ef seq., as amended.Licensee, at Licensee's sole cost and expense, shall be responsible for any cleanuppursuant to any Laws by reason of Licensee's operations on the Propefi and shallindemnify, defend and hold harmless Licensors and Licensors'members, directors'officers, imployees, agents and contractors and their heirs, successoGi and assignsagainst and'froh any 5nd all claims, losses or tlabilities of whatever nature arising fromoiout of Hazardous Materials connected in any way to Licensee's actions or omissionsrelated to the Property under the License. Licensee's liability under this Section 7 shallinclude, without limitation, (i) all consequential damages, directly or indirectly arising outof the use, release, handling, treatment, management, introduction, transportation,generation, storage or disposal of Hazardous Materials at or from the Property bytirenree or any dt its agehts or employees, and (ii) the cost of any required ornecessary repair, cleanip or detoxification and the preparation of any closure or otherrequired plans, whether such action is required or necessary during .the Tep of thisLicense or subsequent thereto to the full extent that such action is attributable, directlyor indirecly, to the presence or alleged presence of Hazardous Materials connected inany way to Licensee or any of its agLnts, employee.s 9r contractors under this License'All of Licensee's indemnification obligations set forth in this Section 7 shall survive theexpiration or termination of this License.6Packet Page 116 of 530Attachment 2 Page 6 of 26

Grauing License- Wllccx RanchJune 2024Page 7 of 13g. Alterations and Mecharrics' Liens. Licetrsee shall not construct or permittobeconStructeoatsonthePropertywithoutLicensors,prior written consent. Upon termination or expiration of the License, all improvementsmade by Licensee on the Property, including but not limited to, all grading, drainagepip"r, iirigation pumps anO unOerground pipelines, elec{rical poles, lines and fittings,i"|.,".r, git"., Oifes, ditches and earthworks are the property of Licensors and noreimburjement to Licensee shall be required. Licensee shall keep the Property free .and clear of any and all liens arising ouiof any work performed or materials furnished atthe request of licensee or obligation incurred by Licensee, Llcensor may requireLicensee to remove some or all of the improvements'g. Condition of Propertv and Maintenance. The Property, as.well as any anda|limprove'ntthereto'isliconsedinanoas.is,'condition. Licensors make no wananty, express or irnplied, as to the suitability of theproperty for Licensee's use or the adequacy or condition of the fencing for cpnfinementof livestock. Licensee agrees, at its own expense, lo perform all malntenance required"nO to f""p the Propertf in good order and repair and in as safe and clean a conditionas it was ai the start of t'tris iicense. Licensee's duty to maintain shall extend to but notbe limited to, maintenance of allfences, corrals, trcughs' water lines, gates, ditches androadways, if aPPlicable.Vandalism is defined as the intentional destruction, disfigurernent, injury or removal ofany building, structure, equlpment, facilities or appurtenanoe of public or personalfr6perty wilnout the conseni of the owner. Once lhe Licensee is aware that vandalismi a, oc.rrred, Licensee shall contact the Fairfield Police DepartmenUSolano CountySheriff and request a filing of report to substantiate a caso for vandalism. lf Llcensorsare convinced the damagi is due to vandalism or an act of God, Licensors may provide-,at Licensors' discretion reimbursement of materials to repair the vandalism up to a $500maximum per [email protected]. Taxes. Licensors shall pay all real property taxes and asgessments whichmay be levieO up6-oi assesseO ag"init the Properiy, excluding, however. those leviedo, ".r"r."d against any cattle graied thereon and any personal property belonging toLicLnsee pndO in or about the Property and any net income taxes or estate,inheritance or gifl taxes or slmllar.taxesimposed on Licensee, all of which shall be thesole responsibili$ of Licensee if applicable.i1. Comoliance with Law. Licensee shall, at Licensee's cost and expense,[email protected]|authorities,inforceeithernowor in'the future, affecting th'e premises, and lhall faithfully observe in its. use of thepremises all laws, iutes-and ieguiations of these authorities, in force either now or in thefuture.12. lndemnificatioriand-httre.7Packet Page 117 of 530Attachment 2 Page 7 of 26

Grazing License- \Mlcox RanchJunB 2024Page 8 of 13A. Licensee, shall indemnify, defend and hold harmlessLicensors, it officers, directors, emptoyees, agents and affiliates from any and all claims'suits, damages, judgments, costs, expenses, liens, levies, attorney fees or gxpert witnessfees or actions of eiery name, kind and description arising from Licensee's activities in,upon or about the Property, brought forth on account of injuries to ordeath.of any personoi damage to property arising from or connected witr the willful misconduct, negligentacts, errdrs or omissions, ultra-hazardous activities, activities giving rise to strict liabilityby Licensee or any person directly or indirectly employed by or acting as an agent forL'icensee, arising from Licensee'i use and occupancy of the Property. _ Licensee'sobligations undeithis paragraph shall survive the termination or expiration of this LioenseAgreement.It is understood that the duty of Licensee to indemnify and hold harmless includes theduty to defend as set forth in Section 2778 ol the California Civil Code.Acceptance of insurance certificates and endorsements required under this Licensedoes not relieve Licensee from liability under this indemnification and hold harmlessclause. This indemnification and hod harmless clause shall apply whether or not suchinsurance policles shall have been determined to be applicable to any of such damagesor claims for damages. ' ..,.B. Licensee shallobtain at itF'own cost and expense, andat all times during the term of this License keep in full force and effect, commercialgeneral liability insurance in the minimum amount of $1 million dollars per occurren@ior bodily injury; personal injury and property damage, as well as automobile liabilityinsuranie in ttie amount of $t mittion dollars per occurrence for bod.ily injury andproperty damage; provided (i) that Licensors, their officers, agents, employees gndvoluntelrs stralt Ue named as additional insureds under the policy; (ii) that the policyshall stipulate that this insurance will operate as primary insurance; and (iii) that noother lnsurance effected by Licensors or other named insureds will be called upon tocover a loss covered thereunder. The minimum limits stated above shall not serve toreduce the Licensee's policy limits of coverage. The requirements for coverage andlimits shall be (1) the minimum coverage and limits specified in this License, or (2) the.broader coverage ancl maximum limitiof coverage oi any insurance policy'or'proceedsavailable to the named insured, whichever is greater.c. During the term of this License, Licensee shall fullycomply with the laws of the State of Cilifornia concerning workers' compensation. Said"orptLn.e shall include, but not be limited to maintaining in fullforce and effect one ormore policies of insurance insuring against any liability Licensee may have for workers'compensation.D. Licensee shallfile with Licensors prior to entry onto theproperty: (i) certificates of insurance which shall provide that no cancellation, majorchange-in'coverage, expiration, or non-renewalwill be made during the term of theBPacket Page 118 of 530Attachment 2 Page 8 of 26

Grazing License- Wlcox RanchJune2024Pago 9 of 13License, wilhout thirty (30) days written notice to Licensors prior to the effective date ofsuch cancellation, oi"hang" in coverage; and (ii) endorsements to its insurance policywhich shall provide for each of the requirements set forth herein.E. Licensee shall require any contractors orsubcontractors performing work on the Property to comply with the insurancerequirements of this Section 12.13. Assignment and Subletting. Licensee shall not assign, transfer orencumberthistice@inwithoutthepriorwrittenconsentofLicensors. Licensee shall not sublicense all or any part of the Property, or allow anypattona other than Licensee's agents, family, or employees, to occupy or use all or anypart of the Property, without the prior written consent of Liconsors. Any assignment orsubleasing witirouithe prior written consent of Licensors shall be void'14. Sale. Licensors shall have the right to sell or dispose of the Property orany portion there6i-r ring the Term of this License, subject to the terms and conditionsof inis License; providedJhowever, that Licensors shall deliver to Licensee writtennotice of such sale or transfer at least thirty (30) days immediately following such sale ortransfer.1S. Licensors'Reserved Rights, Licensors, on behalf of themselves andtheiremploygeS,a@licenseesandguests,reservetherighttoenter and to use thi Property for any purpose, at any time, and in any manner whichdoes not unreasonably intertere with Licensee's use of the Property pursuant to theterms of tris License. Licensors' uses shall include, without limitation, determiningcomptiance with the terms of this License and the Deed Restrictions, posting notices,research, inspection of the Property, protection of the riparian and wildlife habitat andother natural values of the Proierty or adjacent property owned or managed byLicensors, and all other lawfulburfosus. -Licensee expressly acknowledg.es that theproperty may be open to use by Licensors and other third parties as provided above, Atthe'request 6f liceisors, Licensee shall relocate livestock within a reasonable periodand provide any new or ielocated fencing necessary to protect the livestock at their newlocation on the Property, and cooperate with any other reasonable request made byLicensors to facilitate the performance of any tests, investigations o.r.evaluations. Theexercise, ny Ucensors ot ih"it employees, agentg or assignees, of Licensors' reservedrignt of entry shall not substantially interfere with Licensee's permitted grazingoperations under this License.16. Limitation oir Leqal Riqbts.A. Existinq Liens and Encumbrances. This License shall be subject toal|[email protected],ditches,levees, ,oids, frignways, railroads, telephone and electric power lines,.water rights'pipelines and'othir purposes, whether iecorcled or not recorded, including, withoutlimitation, the Deed Restrictions.oPacket Page 119 of 530Attachment 2 Page 9 of 26

Grazing License- Wlcox RanchJune 2024Page 10 of 13B. Oil and Gas Riqhts. All rights to the oil, gas, minerals and otherhyclrocarbons located on or under the Property are either held by Licensors.or havebeen specifically reserved in favor of a third party and are in no way granted toLicensee, Licensee acknowledges that Licensors and such a third party may grantleases or licenses, including rlghts of entry, to third parties for the purpose ofexploration, drilling or minin-g oJ such oil, gas, minerals and other hydrocarbons on theprbperty. LicensJrs agree that the exercise, by Licensors or their assignees, lessees orlicensees, of Licensorj'oil, gas and mineral rights shall not substantially interfere withLicensee's permitted grazing activities under this License'17. Default.A, Failure by Licensee to pay the Annual License Fee or any otheramounts hereunder when due shall constitute a default by Licensee seven (7) days,after the amount becomes due without further notice to Licensee by Licensors'B. The failure to perform any other prclvision of this License shallconstitute a default by Licensee, afler thirty (30) days written notice has been given tol-icensee by Licensors.C. lf the default cannot reasonably be cured within thirty days, Licenseeshall not be in default of this License, if Licensee commences to cure the default withinthe thirty-day period and diligently and in goocl faith continues to cure the detuult'D. Notices given under this paragraph shall speciff the alleged defaultand shalldemand that Licerisee pedorm said provision(s) within thirty days or vacatethe property. lf Licensee fuils to perform within the notice period or commencoperformancl, as the case may be, Licensors may terminate this License immediatelyand re-enter and take exclusive use and possession of the Property.18. Relocation: Holdinq Ove! Licensee hereby expresslywaives the benefitsofanyrightsi@touponterminationofthisLicenseforrelocation assistance pursuant to Government Code Section 7260 et seq. lf Licenseeholds over on the Proferty by failing to vacate the Property and remove allof itslivestock and personr'l pnip"':ty theiefrom by the date of termination or expiration, or ifLi."nr* or its lpesto.i r"tuinto the Property after the date of termination or expiratlon,Licensee shall indemniff and hold Licensors itarmless from all liability or all damage tothe property arising irori', sucn hoHing over or reentry ag well as all legal and related-rp"nrb. rnO corii incuned by Licensors in causing the removal of Licensee, itslivestock o1. p"oonul property fiom the Property. The indemnity obligations of Licenseeunder this paragrapn snalt survive the termination or expiration of this License.A Holdover Fee will be charged and due to Licensors for the period that Licenseecontinues to holdoibr the P6perty, The amount of the Holdover Fee shall bedetermined uy prorating tn" base of the Holdover Fee according to !e dulation of theLicensee's notciovei. 'ih. b"r" of the Holdover Eee shall be 150% of the Annual10Packet Page 120 of 530Attachment 2 Page 10 of 26

Graz-lng Llcense- Wlcox RanchJune2024Page 11 of13License Fee paid for the year immediately preceding the holdover period. The base ofthe Holdover Fee shall then be multiplied by the number of days Licensee holds over,and divided by 365 days.19. Reserved.ZO. Notices. All notices required by law or by this License shall be givenby deposit in the Unfted States mail, postage prepaid and addressed as follows:LicensorsCity of FairfieldAttn: Jennifer Rice1000 Webster Street,2nd FloorFairfteld, CA 94533(707) 428-7727Wth a copy to:The County of SolanoAttn: Real Estate675 Texas Street, Suite 2500Fairfield, CA 94533(7O7l7U-7906Llcensee: Pacific Li'restockAttn: Pete CraigP.O. Box 74068Davis, CA 95616(530) 757-802221. Sgsc€Ssors andlgsjgns. l'his License and each of its provisions shall bebinding on and shatt inure to the benefit of the respective heirs, devisees, legatees,ex""uiorr, administrators, trustees, successors, and assigns of the parties to thisLicense. Neither party shall assign this Ligense without prior written consent of theother party.22. Recordation. This License strall not be recorded,29. anrgocments to Licensa This License may only be amended by awriting signedffie paty agalnst whonr or agalnst whose su@essors and assignsenforcement of the change is sought.24. lntegration. This License contains the entire agreement of the partiesand superseOes a-ny prior written or otal agreements.between them concerning thesubjeci oontained n'eiein. There are no representations, agreements, arrangements orundlrstarrdings, oral or written. between the parties herelo, relating to the subiectmatter of thislicense which are not fully expressed herein.11Packet Page 121 of 530Attachment 2 Page 11 of 26

Graing Llcense- \Mlcox RanchJuna2O24Pqe'l2ol13ZS. Savinos Clause: lf any term provision of this Licsnse or any applicationthereof shalt Ue helcl invaliO or unenforceabte, the t€mainder of thie License and anyapplication of the term and provisions shall not be affected thereby, but shallbe validand enforceable pursuant tro thls License or Callfornia law.20. Waiver. The waiver of any breach of any of the provisions of thisLicense Uy t-ioensors shall not constitute a continuing waiver or a waiver of anysubsequeht breach by Llcensee of the same or any provielon of this License.aa12Packet Page 122 of 530Attachment 2 Page 12 of 26

Grazing License- l//ilcox RanchJune2024Page 13 of t3lN WTNESS WHEREOF, the parties hereto have caused these presents to beexecuted by their respective pioper officers, thereunto duly authorized, the day and yearfirst above written.Its"LlcENsoRs"CITY OF FAIRFIELD, a govemment entityDateItscAoDate:Sep 25, 2024andTHE COUNTY OF SOLANO, a government entityo.,. {Yfi1L-'Approved as to FormOflice of Countv Counsal^"@-Date:Sep 10,2024J."LICENSEE"PACIBy:K, a Califomia corPorationttS: C,lzunlADate13Packet Page 123 of 530Attachment 2 Page 13 of 26

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l. I'l'o;rr(1' l)cso.igrliturL l l.oc::rirrrr of llrc \\/ilcol lrrcl,HtyI rrc;ttctl itt Soltur0 Cqrnrt. llr: polriurr.of tlrc Wilm.r- lrr(rpcn), ctrvctc(t hv this rcipll Nmijrrccnl to'l rnvi.t Air I olcc lln:u 1 t'nitu1 nrxl is :iiruarcJ rltpriiri.icty. ll!..i likrrncru.s (l:rrr):otltbt'u:;t 0l'Vacavillc. I I ..i ltrrr mst of l:nirficlrl. nrrrl ?Z l:nr.vruthurest bl'Llixolr. 'tirc lxrnioii oftlrc Wilcox Propcrty covcral by lhic nrport is r:ogs{pe5sd of rso discrcct lxrrct:l.r th:( mc sqraratrrlby ilrc cr.slcnr_nilnv0y <rf l'At;B (Apwrrix r. Ifigrire l). r}c pri."i,rrrr, of t1e nnrwny istrinrtqtrlru' in strp and is npDrox;mirrcty 2ll8 lcrJs irr:,iz* uhi[: rlx pnrucl srrudrof tlrc rurrw:ry islhr hrrgr:r rlf tln tsm piu'ccls and is t Sf 0.ll nureR i1 size. Sint:r: rt," 1,rn1cny cxigs n:: ltw (ltiolct;ruccls, c'ch;u*:ul will bc dcscribctr a:r nn inrrividrrnr rrnir. nrd. irioi.d*r.ro fir.iritutc rri'rsiiorr,llc lriiltlStrhrr porcet norlh of tlp rurrrvoy s'ill hcccnllcr lx rcfcncrl to rr.r,,$rihox'l'rinngh,. rvhil*tlr pnrccl strutlt ol'tltc nmwny will be rcf.rrcrl to us "Wilcox Wc..rt" (A;rpcrxlix l, I;igurc l). 1'lrc\\tilcox 'l'rftlBlc l'ru1:cny h dircctly ncccssible fi'orn lnlcnrntc 80 ;( b[*n,, r,in lliphwry I l3 rrxlllu-r l(ond, u totol distsne.e of npProxluntcll' 29..i t'ru 'ltc Wilcox west ptrltrrfly, tourrcrl suurlt'f lbc caflenr'l'AFl] rrrnwoy, is ncr:erstble horrr (trcsJ llorrl virr trrtcntntc ll0 nd I{iphrvrrl, I 13.rt totnl distarrcc of nlryrrrxirnnte.ly 3ri.j kur (A1lrcrrlix l, Figun I ).Z.il l)*rcript inn ol'thc pr.oprr.yll'ih:ox il'ilangh:'l hr: \\'ilcrrx'li'ionglc lx'elx!n]' is utilizr:d ;r:i nrn.iuigrrcd plrstrrrr lhr r::rtilr.. l'lts \vilcox'l'liuqlc is, nr pre'ioru'lynrourioucd, rri'ngnr,r i,t ".'ri"U'ii^1r..diJ-i,,.rur,4ro"rrluf29B acr.r,'llc rvcitcfir sidc of thc wilcor Tritn8lc pioprty is lprrrxjorl iry l4erlliun lload nrrd rhc nortbcrrrnirlc is borurdcd by tbe absrxlonul Srnralrorno t'torU*rn it il,""y. 'lfu ,hypotemrsu,: of rhcWilcox 'friarrglc pFp€ny is hountled by ftc cnstern runrvny rrf TAFR (Apgrcnd.ix ?-, Filrurc 3),lfilctp: ll'csl'l'hc Wiloor We'rt Prcpcn.vis hcirq oliliTrd n.r rxrn-irrignrcd pnslure fur c|t|tlc. 'l'6wilcox wcst-Propcrty in compos:rt of tsib.o.t or:re$, is irrgu"tnr irr iwroll slralrc and is iru*lylcvr:l oxccpt for n hill q.^- tl lhe suuttpnr pur of rhc I'mr"rii ino rtrirrn Mormds in thc cncrcmltrtrl of llrc Prolclly. Tha Nortlrcm odgc oirhe t&itcor rt;i'p;,*,iy is boruulod by fhc crrfrtcmrunwRy ofTAFl] nnd thc Arrlrcrvprolxny rvhitc U* wc*r"nrc,tio ilUnr".rrd by South McridhnRourl. I'h: 'qrrilhcm odge is.uounrttq iry {in rr Road ruxl try ortrir jii.,arc prop€{b. uxr thccilslcnl edgc k bou[dcd by drc rcnuriniig, enrronr pollion oi tt* witru* ltirprx'ty owra by T1cNsture Corucnnlcy (Appendix l, Figrrrc Z),1.3 liurourxlirtg Pnrlrrticr:llrilcttr ITiougtc- l'rupcrty lo the cnsr :rnd nonh of Mlcox l.rionglc l,ropoty ls prsture;urd is 1;rnzcd by!llt!: t *1rcrty to thc west of Witcox 't'rinnlglc l,rop:riy i, *c,narr"d,IAF r. .soirm lrtu wrrcox.irfui,gl- n"r*ii, rs rhe 'rr\rrB ru,)lv*y,i,ifffifr:';il'q39$Sj}lfiili,';il,,,,,rrlr til6 i11 llrlr lJtk:U.r,rr...,r /*l fLl.rrurl l|. Jrirnt,. l',1', ',,l'. ' tirrrld t{ $i'rlnN\* ' thr: liortttiY rr''r(trl;:r' ' "'J:, /n];;;i;'y,i'IPiiPacket Page 126 of 530Attachment 2 Page 16 of 26

ll'i/Fot ll1"^l 'r''i,,rr.,lr. ltrr,rrr.rrrr rlrr. ri .\ltllotlll(lc'rl lry llir:jtul'cl,ikt: lln \\tilr:ux'l'rirrnlilc I'to1x:tlY. llrt: \\tilcox \\'r':;l l'rol'r':rt) t(:N(,clrl lil lh: ttrlt\v.r! trr lh: tttrtllt (L|Pclriir: ?-. t'igrrrrt ''),l, 4 Lcrr:rl Dcict'ip( iull1rr.r lirllorryittt'. trrt (?) lltt3'c* 4,',t t'*l-,I,:(iA l, I)fCS(lll t ll'l'[( ) Nf6t' thc lxriliou of'rp Wih<'x Ptolrr:tly llt;rt is cor'crt:rl 5y tlrir; rc;xrrtThhr trrlnu*nl b-lt..U,t"'i'tt''ft1' t't rht od l llilflirlt lrt;'llr lhhr l"ilu"1iffr,ir, afao/o/lrrrrfi.-.nl lt. .!r[rn'r l,r. till:rl f 0li:r tl^:,,1 rrl .' i t{.'r' ' \ 1i;'ii,i;;;i;;r,','irnPacket Page 127 of 530Attachment 2 Page 17 of 26

tl'avis Nq;ervnt)FSCtrlPTtOht/rlllltill rcal properly $iluirle in tlr0 Gounty ol Solano, lllala ol Cirlifonriit. lreing il ;xtllorr ofSucliu,r't:; 1ll, 1{1, 7n,2l',29 ancl 30, Townslrilr li Norlh, ltllrrre 1 East. Mount ltiaUlo McrkJianard dercrilrcd arr foflows:'l'|rc liouth ottr:'ltirlf nf Sccliott 20, lhe Norlh one-half of {iocliorr 2fl. alrcl all ol Srx1i'rrs lB,lg.ltl and ll0.'l'ovrnslrip 5 Norllr, llnrrgc 1 liasl, h,lount Dlatrlo lvleritllalr.EX(,'EPTll'lG lltutr:lrortt all thrrl porliorr of Sectlons 18 and 1g irrr;lgrlod wililn ltre lnrrnr.farylitrcs ot lltcl ccllilin lad of larrcl contalnirrg 254.53 acresi, lruc ol 1-'s:;, dr-:acli[ctl i1 .lurlginelrltirr Doclitlalion ol l'akirtg in favor of Ure Unite*t $lrrte:; u[ Arnsricn irr l-echrr.rtCrrrtl Ar:licn Nu.5285, dated Jtrttc 27, 1046, irnd a cortlficd rrpy of which was rocorcled August i,'/, tt)40 inl.lool 3li0 of Offtcral flccords, al Fage 133, as: lnstrunmrrt l.lo. 11)g6li rjaid lS4.bij rrcrg lrird lsnl:::o dasq'lbxl irr 'Amonded t-ir nl Jttdgmcnt ar lo l'rad No. tr 1 ". ttfllort Scplernlrt:r Zl). I g4ll:rrtd isl:tnd tlrt nl lltc scntr: l':ctJcral Oourl Aclion as befcrrc rck.rrrcd to. nnri a cerlifisd aryy ollvltich was t'ccorded Octobcr 4, 1948 ln Dook 454 nf Ofliclal Reccrrcln, al lJage S,14, al;ltrr:lrrlnent No. 103ti8. Solano (:ounty Rr:crrrls;ALSO EXCSI) l'll'lG thercfrolrt all that porlion of Sccllorr lll hrr;lrrclcrl rvilhirr lhc brJun(tilry lines' llrat csrhilr ltact of larrd corrlirhring 76.85 acres, ntorcr ol le:ir:, clcscribocl irr thc Firrul.rldgnunt ln Coa<lelnnalion-Awarding Jusl Conrponsalkrrr For Tlrr:'l'akirr1l 0{ l'mcl 8200 infawrr ol tlrc Urrilocl.slatcs of Anrorica fut l:orJsrnlcorrl, cir4rAclion t.to. zcrt1, ctale<l December10.1063.ALSO EXCEPTING therefnrnr all of lhe rigltt, lillc and interost in anrJ to thc slrip of lanct 100fecl ln wldth acrosr ,llrc ltorlhoasl quatlsr;l Sr:ction 30, the nor{r ono-lrall of Socfion 2g andthcr Soutlr onr:-lralf of Ssction 10, clercrilrcrl ru a "Rlght of Way flr llailroad pur;xrucs" ilr t)rlerJfrom 'llromlon Sni,.lar GlkJe lnd wllo, lo ,gacranl€nto l.lorlhoni Rallway. a corpoia tior r , drrledl)ecentber 10, 10291 nnd. reco^rdcd January 13, 1930 ln lloolc 4tr ul Oiiicial Rccon]s. al Pngc300, as hglrunrenl No. 177, Solano Courrty Rocortls;ALSO EXCEPl'lhlG lhorefronr that portion ol tiocliolr 19 conveye<l to the Unlted fjta(esof/ttnerica by Dcod rctxrtdod Juno '16, 1$155 irr Book 774 of Ofticl,aillecclcls, 3t pago 14S. aslrrstrument l{o. 1'1966, fjolarp Courrly Rocorcts;ALSO E)i(;EP'flNG thortrfiom all those portlons tlrcroot witlrrn lhr: bourxlaries of Coul'rty RoadNo, 125, also linow as'Morldiarr [toacJ";l.rr;l $rrh$rtl4fll ;L ltt . .,yr.,, sx llr:,;{f;6f: , ., rrfllal.i,lr:;i / /, //r,/llir lo. t fl .lrr rrr:: r. t.t . i, r ,ll,. . r)itr,i irl I t1,,.. r.,,.;, 1.rlirt t,'trr,r. ., .,i,r,.rp, ..,;,,/iti/;;;i ^{pr,x,Packet Page 128 of 530Attachment 2 Page 18 of 26

At-SO p)iCFPTll,lQ lhetrtttuottt llxrtitt prtrllott:l ol trtful R*lirur'i 70,?1nnrl39-lyttrg"fJl*"*r"rfy r.rf Urc lilrc slrrrwrr as llru "Trrvi$ $etbar:k Llnc'ott lhc rccorcl of rturvoY filed futt3nok 25 ol giutvcys, i'':igc tg, -golano Gounly RcoottJs. ?.tl9g9 tr"rglnc o1t iho-sntlllr llntt crl:;rrrd Norlh one-half oi s["to,i lg ilt I lruinl ilral lics tbuth Btr 17' 30" F-ar"l. 240.11, ftrot frotttllro wcsl quillu ff tnr:r of r;:rirl .$ccliori 2ll; lhenco Nrllh 44":t7' 3:t" F.rt:;1, (rt ti:tltl '[titviriScfiract Llne 8,757.13 lctll lo tlrr: begirtlrfuig of ar lolltlc]l cllrye concarrn lo tlro rvr':r:l having n;;;;;?bOObO feet and n central angle iif 410 4{r'}5o; lhertco turllrorly trn llte arc of sflidcurvg 14s4.g7 lc,{,ll lltcnc.c Norllr ?" so gs; F.;'st, i177.?ti le:at to llrc rullr lltro ol $ild $ioclionil, .l,li'iJri.ion -ui"'r"Jton nne bcing rs63-so leet eastcrly of lhe norllrwesl comor of saidtioctiort it nnrt lhe norlharly lermlnus ol thls dcsctlption'rND OF DttSCRlPl'loNCorrlirlnirrll 1 tJF8.43'{'/- itfl t:$.l'ha :rbove descrlplion wets prePoro<l by me or undol my direcllon:DaleGary 1.. 0rrlrllonl.Llcottse ExPlralionL.ri.3B43Dale CIll0l200lY!1o{rla..lb-rlllr l*rlrmanlhoCtltr, '' frit'ni ltlr ltllllndrrrt frhr h: llilt otll;..r.r, 4rthrlllclrnl lt .kirnn:r\ lilrr, r "lh4 \t'.td,,' r'. r' r i';1 r :rll,rrr {., .,, ., - I 'r , I 1 ,. rl1rI t,r r l, lrrr..)ilfiln'u+t /rt1Packet Page 129 of 530Attachment 2 Page 19 of 26

l,xilHil'l'LtCO l'\' Oli I tl{ l,.l) lt US't)ll(:'l'l ONSlcol,]: oF l]ltut) lus'tl(t(;'t t()Nl; ili A'l't'Actlt.l)l)lrrF(:t't,\' Btiltu.U) 11il$ ):x_!ll!lrl B covliti J;l.tEi.il'l,,,',,1'li.T,l',liil,',1',ll n,,rj.f ^t,.n:2f 2a/0{irilr.lrir'.111.JOlrrr...'t il :,'il: lltt.rjrl rri ll tl ' .' ,:llt; (;t{nl:T rr l, 'r ' , 'i/l t:' i)i" t: i,, ; ., I ),p,:, /:1Packet Page 130 of 530Attachment 2 Page 20 of 26

Sfl lril.tlJl.[r JI Il':l:: D.ll, lisJ li l ( il lll{.II list;rhlil;ltrt$ttJ.g.t l{t:,iltjglJUlg, Grrulor lrrcby dcclirtc: llurt tht lltotrt:tlY. :t|ylcvery [u1t rh,:luo(ur inlr:rr:ll lhrrrcip, i5 61rvr fucltllrxl shnll hnrenljrr, inplrprtuity (srtlrtccl ttriclrr,illrti.ur urrly;lrrnrnnt to $lcriou.t bclorr,), bc hc:ld. $urfclrcd, solrl, lcirscd, r;rrttrtlyctl nttrlrx'cupicrl :,rrbinit io the rcstriclirm.r (r.ollectivrly, llr "Kr13lriS!Ilf.!") sr':t follh lnrcirr, Tltc|i,j$lii4rirrrrs i.trntt bru'dcrr rrrrrl rrrrr rvillr lltc l\'o;rrty, ntttl cvcqy;llrrl'llxrcof nr inlctcst llx:r'.lttt, nrxlilurll tx. hirrdilrlr olt ntl pctsotls cir cnti(iel hnvir:p rrr ncqrtirirtg att.v ti11ht, litlc ot irilstcsl itt.lhr:l)tr4rcrt1.. r.l hny prrrl tliurcol, und slxrll lnncfit (imutor, 'tlrc l(t..rtrir:tions :irc intclrrlc.ri tn h: rr1;or,r,rn,,l t.rrnnir[ nirh thc lirnd in ncsordalrr: rvith (hlifornia t.jlvil (,]odc liccriun 1462 !'!-t!!.nrrtl stuilt olrty bc lcmrirtalcd itt mcoldnr*c with ,$eedol-[ hclorv'?. Pc.rrrrirtqd.U!r:1. 'l}re ur;r:s of lln l'rro;rc:ty sllnllltc rcr(riqtud to lhc following;rcrnr i t tcrl r rse s (col I cc li vc ly, t hc " llggr.rri t1 q d-l bqs "):(n) 'l 'lp pruirrlE of .slruc;l untVtrr mfltu orr lhe ttrcpcr ly itt a ttmDrlct- lhrtl tklu:'nril leg,ra4c rhc. linbitat \raiucr uf ttrc I'ropoty (us rlelincrt bclow) cxintirrl: :li of lltc dntc lrcrr:oflO) T'hc con,rtrucliorr, opcration, rcpnit, umhtlcunncc ltd rcplac.ctrlctrt of trtinrll'lrrr..r'csirtetrtial nn<lnon-huLritnblc rnrprovcme.nLs whi;tt arc sllecilicclly rclatcd to lllc pclltliltcdirr"ri'g ;rcljvirics ltnl nrc. crrndrrcted on thc lropcny, $trch ns fctrccs, connls. lrotrphs. r blrtt :tndiu,,nii,iiU*; pmvidr:rl, ttut srrc[ cctivities ntrall bc c,olrlucletl in n tttnturcr thnt docs trrt tk:grntlc lltcHnbitnt Vrrlrrcs of thc l'ro5.rt.v (as r,lcfilrcd bctorv) cri:rting ns of thc dntc hcrcof;(c) 1'ernpornry rrsidcntinl uscs lhit arc nssociatt:rl rvitlr or incidcrrtnl to tlrcpcrruilcd 1,r"ziit1i octivittc;s,nrirrctctl on ttrc t'roprly and lltal do not involvc lhc construction ofirrv irnpro"ctncnll.on thc ltopcny; anrl(,1) Arry and all ncriviries by thirrl pnrtics JrtrsuoDl to nly leascg licctlscs,cnsclrcpts, lcnaniics, posi"sso,y righF, riglrts of rvay, or othcr lhird porty rights to lca5t, usa, or;6t;11'rr rny ponion of rlrc-l'ro]xrry fwhcthcr pLscriptiw-or ottrcrwisc) in cxistcncc as olthe dstc ot'thc rccordlrion of ttrcsc l(cstriction.s in llrc Ofliciol llccords of Solrno Cnunry 'Crlifornitt.For purposcs of this .,9sf.ttqx.2, lhc tenrr "llddrul$lusgo-f the Prqpc.rry" slnllnreutr thc trorthcrrr "tnypon vcrnal pools nncl vElley nccdte. grnss grursland hobitars lvhich srrpponnrrury.s;rccics, including, without iitrriurtion, thc Dclta gre.cn grotmd bccllc, r'ernul pool lbiryslrinrp, con$rvartcy firiry :ibrinrp and tadpolc shrinrp.3. gfrairrg-|1gstri|;tiorrs, Cmntor conlirms ard agrccr thal Gnrrlcc sholl rrot bgdcenrctl to luvc rlcgniirtltr. lt"t,ital V:rlucs of thc Proprrty rr"s long as thc grazing rctivitics onrlc iruporrl'nrc co;duitcd in eornpli;ncc rvith citbur (a) lhir lcrms md conditions of thrrt cLnnilll.rrm Lrse wirh lichcnc Enlerpriscs, lnc. llud is in cffcct ns of thc dutc 0rcsc Dccd Re-su'ictionsnre rccordcd in rhc Oflicinl Rccords of Sotnrto Cotmty, or (b) cnch of tlre follorving gnzjrrgreslrio(ioDs (collcctivcty, llle "$1s{11e lt!:$riHiaDl')i 11ll lnrlntsr"nl k R(i) l.tot tcsu rlon nn ove^r'c of scvcn hurxtred (?00) 1nund, n"r,,[iJ',i*olJiir*iiliiili]''t'illlr::'*;ifr ;H,l,T':]*iy;l;*,iTll':il;:ffil[i$lttLT]zlfu "iwcr'c{1.,r!rrhr,,rrl( t:i''l'l:l,;i :l'l:iil'1lf 1;: 'llll 'lr'r"rr";:i'1 ' ' l:rr).3 ltt il,l\";/-i tl),i"/iPacket Page 131 of 530Attachment 2 Page 21 of 26

r'.tclrrr[:rJ r]i'olrr ilrc c:llcullriotrt rl Rl tM itrr. ;rn1g1uc., rlxr nre lnrrrcrl,l.),lds, Fc,lltillt'd im;r1j1'1'11rsnt sttgg, l<rcl: oulcropii, :trri.q rr,ilhirt u:rr:Irrurrjrr:rl ( l0{)) lclr oi wnrcrirrg r,l,rrr::., arrirrrll lurrrdlinl; curals and vcrrr.rt1'rt'l b;rsilts. crir't'r rrxry cor(hlrr 'rr irtr'ual rtrorritnrirr'1 ot'li.Dh,r in orrtrrto rlclcrrriirrc crxrrpiinrtt,r s'irh l.ll)1.,1 ,crlrrir.(:rrrcnrs sct for{r aSovu irrnccor(lilrrc(: u,irh &plfUf bclorr,.(ii) l-hn ntultutl grazing sc:rson rrn tlrc Pro;rcfly.shatl c.o,rlDrcucr: rrrr c.irdicr tlnno*tob* I 5 of nrry yr:lr nnd shnlr cxtcr:cr rxr rnrcr rhnrr .runc ti of trrr.inr rrc dil(cly fol lorvirrg yerr,(iii) 'llrc ttsc of rltpptcnu:rttnl livcsurck fecrl :urtl ftrrngcr rvhclher 5y irrrprrrlinl.,hny o,' orher fcecl onro rrrc ltropur 11, ,rr horricuturintiy inr'utucirrj ;;;-'--"turlivr: forngc plnlrl nrrrrcriaton rhc lrrr;rcrry, rrmjl bc Jnolribitcd;lrrovidcri,tltat thc rrsc olsalr lick.r anrl nutririonaisrrfpl"nrcnr,, suctr ur virnnrjns shallbc;rcrnritrcd.(iv) 'l'hc applit:ntion of fr:nili:rcrs (inclrrrlinJ,,, bur not lirnitctl to bjo-solirk;) nnrlhclhicidcs shnll lx plohibirr.d-rscept for rlre rrrrgcled oppti"nrrorr ,,illcttticidcs ro (:o[0ol the s;rcad of rron.nrrivc plarrls ald noxiorrs rrr:q:4s i6lhosc arr:ls of lhc Prrqrcrri wlrrc tlrru hn:; bccn nn oullx,c.l rrf nornmtjvclilturll; rnd rroxiou., wecds; providccl, tlr.rt in r,r, cvcur rtnll hcrbicidcs h.tt:;ed in nny of lbcr vnrul pools cxi.stirrl: orr thc t,ropert1,.4' Irchibitcd Utrc$. All uscs of tlrc Pro.;xrry (hnl nro not cxprtssly pcrmitrcd jp'scc.$orr ? afnle arc prulrihited 9t.* lorrg us tln Rcsrricrions rcmair in'crfcct. bp"ifirolr-y, n"tn lor3 ns thc l{es,trictjorrs rcmnjn i1cffdt, rhc following rll.cs of, *alo, activi6L on,ih""Pnrpcrty.chnll bc' pmlrihitcd: (o) cxccpt;s upcificaltl,hcicinnbovc providccl, rury re:iicnrinlusescrf, or aclivitics on, thc Pr1J1ny; and tt ) ,ri corruncicial or ildusrrial unes of. or ncrivities on,tlr Pru;rcrty, iltcludinlr,, rvidrout lilritlrirn, iccdlou. which aru dcfiucd as llly oFcrr or cncloscdnruu wherc livcstock orrmed by otbcr thu thc fcc oivner oi thr nroli*y or thc lisscc or teueurt ofthc l'ro;rcrty are groupcd togsrhcr for intcnsivc fccdirrg prrl*rr.r, o1 sliugfrrcrhouscs..s. Bight_0f_lDlrrruden. Grmlor nnd its cmployccs anrl rcprcscnrativrs sball bcqrlirlcd ln cnlsr rqron dtc.Propcny on nn atutual bosis for rirc lirnircd purp.rs= of confirming 1ratthc ltcstrictions scl fonlt in SrerlcJ I rurl 4 hqtof arc bcirrg rrrct. tticl it nny g*r, .nrry 6,inspcctiotl Porposes. tbc por ry excrcising, such inspccri,rn riiltuiuitoli providc fourr""r, l ial doysurjtlcn not,cc to lhc tltcu "q":r.t fce owix(r) oric"onr oiiit; p;;;riy, wtro shalt hnvc n ighr,logcthcr rvith such fcc orrncr(s)'.employccs an,l agcnrs, ro accornlinny nnd obsenvc nrch11s111tions, lf tlrc party condrtcling sush annrral iirpc.i;ons. oioi"h prirry's cmptoyccs orngellls. Prcpare nny tcporls, diagrams, chans, graphe, photogrspl$. audio or vj.su:rl rqcordings oroftcr wtilings as a rssull of suctr inspccrions, iopics bi'srrch'docuiircnrs slall bc proviJcd "ptonrPlly to the drn cltncrtt fcc orrne(s) of drc Prolrrly. 'I}c inspccring pnrty stolli19t Uonrttltoriz.cd lo rcmove nny molcrint, sp""ii,rcn, ,r,npi. urlsr,bsrar,"c liom itrc p;;,.y c:15i$,lt,igr*, * ,thc nxprcss con jcnl of thc rhcrr cun'cirr fcc orvnc4i) of rlre r1'opcr ry. Acccrs ,o ir," rrurnililbt ..r tnu ort.'i,,.addrlional lintcs nDd for ;rdditionnl prrqposcs ,,,u1, 'l* ,o1,,.oia'try 6ranror. but sha[ ie'rigirdi[i,riru,irn icxprcse ;:rio1 np;rmval of tlre rh*r crr r r:'t fi:r orvrrcr(s) of rhc l,rirpcnl. Cio,r,"i [1,f;ilri;,,rt rryO1'ud'*Arer'tthllur0 mr*,,irt]"rrrr(".'r,.: ' 'lhg ll.tr,rrl 0{ !l'l!('r ". 'llu, t. rtttrlr'r'' l'. i. :t'I ..t t. .,, i ',;,r./ )t( l26t a.y ,,t..44o'''nPacket Page 132 of 530Attachment 2 Page 22 of 26

inrlt'rrrttill', llrllJ lt:rttttlr:ss. tttolrtcl nrrd dcf:lrrt (.iriutlcr frorrr irr,rl rrg.irilrsl arry antl tll clnirns.dr:ruirirrl.:;. lr:rbilttics, lrrcsc:;. lxrv.,rrrit.r, jrrdt:tue1rt!, urr;t:, .Jrxu-Jflci, :rrld rrthci cxpr:n:ir:3 trf ;rrry lctrx!rx ritlutc rr,lt:tliolvcr (in,:lrnlirrg. \vtlltolll lilttilali|rn, I'otrrtcr).\ts nt,{l ,f,;rllltilrlrh: flttorrlry:t'li:c:iittrd r)it)ctllicti of couit:;cl sclcclrrl by tlrr tu<lorurilicd ;xrrt1 , t'lrr:lfrr:r incrrrrcrl at tlrr: trinl,up;lrlhlr:. t,r :rdlninirill:rliru h:vr:1, or irr coruxctiort rvith ;rn), nrbikirtirrn), r...hich thc (jrarrtcc run.f!:uttnitt, ittttu, ol :ruJli:r asrr rcstrlt of Uurrttr)r'lr cnlry nnrl rulivjti*r rT)on lhr l\o;r:rly plnsunnl t(rtlre r ights f t,urlcd (o (-iranlrr undcr llri:: licrtlotL!, bul rrxchxlinf. itny nt:rllci:i cau.v.rl by iltl'rrcglil;ur:c or willful tntltcon(htct of Grunler:.(t. Itrguttrcd Noti-c-c1q.l1rql1q.!.g'lsr;tl-tttuUicglttc.i. Arry lcasc, licernc fi otlrcrrr:ttlal (tl u5c ;tlrccnrcttl rubscqrtcnlly crttcrcd intrr or nratlg rvilh rr",ity:cl to any lnrliorr ol'thcl'rtt;xnY. rvltclltl wnllcn ol rri:rl, slrrrll conlain nn cxFr(:lis llovr;ion infrxnrirrg ilw lc.,.rscc, lcniltll,licrtt.tr:rl or rr!ll(:r cotrtr:rctinLt;xrrty of lhc Rcltriclions anrJ lhc (ir;rzirrlt ltcsrrictxrns arrd shnllrequilc:.uch lcsscr:, tcnilnt, licerucc or olhcr conlracling 1xny to cornplv rvith all strchlicstlrr:liurs und thc (irur.irtg llestrictiorrs iluoul,lrcrut llrc tcrm of srrc:h lcasc, licrnrc or renttrl ort!s{: ttttNr:nrc[(.7 (,qrlrq:irUtlf r.{.lrtolrrlJ(") ll'Urnntcc rlcterrrrillcs tlal ull or rrry poltiorr of lhr.. I'rqreily is "rurplusland" (rvitltitt lhc tncnning, of tlr Colil'ornin Govcnrmcut (iorlc Sr:ution 54221(b)) rrnd deshts trrscll or crnvcy tlx' Prtrperty, or such portion ilrcrcof, lo a (lrird pany, fu,cn Gr:rrrtcc stull offcr Ucl'rop'rly ot rucb porlion for srrlc orbJect to the righl of tirst rcfu.iul (thc "llrghpf-fi6.i1&atrtrtrl")bt firvor of Gt nntot ns provirlc<t irr liectiorr l6 of thc .tgrcr.rncrt nnd Escrorv lmlnrr:tions forl'ulcha:m nld Snk: o!'Itcal .l'ropcrty (thc '6gpt*rrr) bctrvuen Grantor. as $Glter, md Grantcc,as buycr, rlotcd ns of Augusl 15,2002, lf Grantrr duly cxcrci*s suclr righl, Gmnkc shrll scll:nrl convcy hc Prnpcrry crr such porlion lhcrcof to Grnntor.0s tnorc specifically p'ovitlcd in tlr:Agrcc.mettl. lf Ornutw drxs lrol r:xercisc tlr RiJiht of Fint Rcfusnl ordocs not rcquirc lhcl)ro1rcrty ur mch lronioD lhcrcofpursuant lhcrcto, lhcn Crrnlcc nmy scll thc Propcrry or suchInnaon lhcrcof to Oc third pafiy poruuunt to its offcr to purchasc tlre Propcrty or such txrdlonthcrcof itr rcspcct of which the lUglrt of lTrsr Rcfusal nrorc, Ulq.vjdq{ hor,rrcvg, tlrst if srch sslcoccurF witlrin 9(l ycnrr aflcr thc dntc of tlrc rccordnliorr of lhcsc Dccd Rcstrictions in lhc Otnciulllcconls ol'Solnno Ctrurrty, Culifbnria, Ornlttcc shnll do so srrbjcct lo R coruBrvotion cascmc.nt infnvor of Grnnt<rr inrposing rcrlrictiols on lhc Prop:rty or srrch porrion thcrcof nrbslantinllyidenticll to thc l(cstrictiols ssl fortlr in Sgitiqn* and I lrcrrof urrl othcnviro io nccordmcc witllltc rcquireincnts of California Civil Codc Scctiorr 8! J.clSq, or srrnilar ilocclror statutes irrfonn nnd sub$ancc re,lsonebly acccplrblc to Grnntor to bo rrcordcd in the Oflicinl Rccordn of.Sohno Oouoty, Cnl ifornia.(b) ll'Grarrlce coDvc.ys lhc l'royrrty or irny portiot $creof lo onc of the p:utioscortrlilutirtg Grunlcc or to a joint powcru authority consisting of rhe. porties crnstilutiDg Grantce,tltcn tqron sucb conveyanc.e, Juch pnrly or srrh,foint powcr s uuthority shnU, upon Oranto/srcquest, con{inlr to Grnntor in writing tlru cffcctivcncss of lhc tcnns md conditiorr hcreof uponnnd aftct such convcynrrcc nrd shall uruse lo tx rccordcd in tbc Oflicinl Rccords of SolanoC'otluly, Coliforrria, such instrunrcnls as Gr:urtor mny rc&sonnbly rcqrrcst lo cffcctonttrilrfihnrrrraolhncottfirmntion or cottlitrtrc thc cflcctiverrcs$ of thc Rcsh'rctionr nnd the ltight of Fir6f$fX4f-ot Sru ,rrlfrln,rl(c) 1'hc ;:rovisions of this fc-iliatt-? shnll not dt?ly to ",,y .onu.yo$cft0[|ltoottlm'l'ropcrll' or nny ;:ortion (l*rcofconrcnrpl1166 irr,sfclj-qf-[ hr:rcol. m[m ildA/Ot'xhrrtAs',r.Er,,rb'vr ti,fl$r:1-,*i:1li,T:li ]1;;l{;'' l't'lt"'t1 'rr)'5 br );;i;r1,fr1rti/'t'Packet Page 133 of 530Attachment 2 Page 23 of 26

tj.'l-rrrrrln_nriop qf l.rq:r3r[-fir,:irricri(rrrs.(u) -..(jraltttrr cxJrrcsrl.l' ,rcttrr,rTlcrl[c:1. coDfirrnr ;rrrrt irgrcc.., llnl ilrtr lirst;tr.lion.sirrc lol irrtcndcd to irfli:ct,.hilrrir:r, irlrpcilt:. riitcouragc oi otlr,rnvjscj inrpru,t lrr1, finurc r:riprnsiurrof tht: :rit lllililllolilrn facilirit's ,,otrrtriunly lnclrvlr rrs'li'lrvir; Air t:oruc llrrxc ior rrrrhta;v, f lbcl)ropcrly, or lbc lratrsfi:rrcrl Doniotr thcrcr,f. th.rt arc clctriin"nhl lo tbe nrilitnry opratinrr* oiTrnvis Air l;urcc lJasc.(lr) Ar lcn-,:r nincty (Xl) dayr prio: lo any trnnsfq ol {[c l,r.qrny, or xnyponiort ilr'':rco(, lo I SovcDuncntal ugcircy nr.niity that is rlescribcrl in rh,.r Sg:tial h., thc tlrcncrttrcnt ltc owncr(s) of thc Proptty. or th,' prtion rtrcrcof prolroscrt ro tr. *n-u:,psfcnc<t, strnllProvidc rvritlol nol,icc lo.GraDtrr(thc'l!pricri'). Prornptly'uporii*"l1tr of'such Noticc, crunro,nhrll cxccrle :r Tcntrinn(ion of Rcstriqioiiur ,o rlo trrop*ri "r ii" xi,.rion of itrc pfi;y'proposcd lo trc lrut.tfctrcd, ond shnll dclivcr sur:tr cxccuLrt Tcnnirrntiorr of Rcstricoorrs lo lhscscrow ngelil cicsigtrRrod by tlr ftcn cun'qrt fcc orvner(s) of the Propcrty, s,irh irrstructio16 lorccord.qrch'l'crnrinnrion of Resrrictiorru in lhc Ofticint Rccordrr of iotano Couly onty upon tlntransfcr of thc lkrpertl' or por tron tltcrsof to rl" g,-"rrun"nioi;;,;; or enriry dur is dcscribedin lhc l*rticc,(c) 'lltcsc ltcstricliottr utuj the ltighr of l.'irrt ltefusal shnllrcnrrinarc :uxl be ofno firnhcr forcc ol clfcct rrJrcn llrc rccoltlnrion ,rl'nrrf conscn,ltion casorrcltl conlcnrplntcd irrrletiedbl lx:rcof ns to tlrc Propory ur llru tx)nion rltcrcof coycrecl by rnrch consurvationcusctncn(.. 9' Ellhlr:cnrctrt Ttle Rcsriction$ mny bc cnforcccl by Grnnror by any procseding arlnw or in cquiry.AttagteYEifc,.qJu]d-Cot$. ln any nction broughr to crrfurce or to rcsrrlin anyviolatiorr of'tlrc Rcstricrions, rrrc prcroili,u pury shail ,""ur.i fionr tllfl$ilniriifr *i;r',ffi ii:fu'i,-:*"n*rnirir,l;*'y#;illilffi#i[f [:,''brurkruprv tlr ntbirrutiorr Pr'ccedirrg. incluiirrp rvirhotrr linritrrtion rrnrsor r rr.rr c i#i&er r.t;i/, /ifttlttutl ll. ,lolr' . rr'. t'l '. ' 'lltu il'ltrt'l r ', l 'l' ' 'lh. (,i,lrrrY "l ' 'J l' :' ',,,, h'l -)n i' l:)o',, AY't1 ;fur( tr. r, a I{. lriihny'6t). (,Packet Page 134 of 530Attachment 2 Page 24 of 26

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Agenda Item No: 12.

AGENDA REPORT
DATE:October 15, 2024
TO:Mayor and City Council
FROM:David Gassaway, City Manager
SUBJECT:Resolution 2024251 of the City Council of the City of Fairfield Amending the Departmental Position Control List of the Following Departments: Community Development, Fire, Parks & Recreation, Police, and Public Works RECOMMENDED ACTION
Adopt resolution.

STATEMENT OF ISSUE
To address staffing needs, improve service delivery, and align resources with council priorities and goals, staff is requesting amendments to the Departmental Position Control List of the following departments: Community Development, Fire, Parks & Recreation, Police, and Public Works.

DISCUSSION
Staff recommends Departmental Position Control Lists are reviewed periodically to ensure that staffing levels are aligned with the operational requirements of each department. Adjustments may be necessary to meet the changing needs of the city and to maintain efficient service delivery. The following proposed amendments reflect the necessary changes to support council priorities and goals.

Community Development
In the Community Development Department, staff is requesting an addition of a newly created deputy director position. This new role will provide additional managerial capacity to allow the department to better support and guide development services and provide crucial leadership and support for improving permit processing at the department. The addition of a deputy director will allow the department director to focus more on strategic growth initiatives and to work more closely with the economic development team. The financial impact of this position is partially offset by downgrading the economic development division manager to an economic development manager, as the latter position is deemed more appropriate given the current structure and staffing levels. The downgrade reflects the reduced number of direct reports and adoption of a new economic development workplan, which is more suited for a managerlevel position.

Fire
In the Fire Department, staff is requesting an additional battalion chief position for a limited term. The Packet Page 137 of 530

Fire
In the Fire Department, staff is requesting an additional battalion chief position for a limited term. The limitedterm battalion chief will be eliminated upon the retirement or separation of an incumbent in one of the current permanent battalion chief positions. The deputy chief position was underfilled by a battalion chief when Chief Sturdee was appointed. By adding a limitedterm battalion chief position the second deputy chief position can be permanently refilled.

Last fiscal year, all departments were directed to reduce their general fund budgets by 5%. To achieve this goal, the Fire Department underfilled the deputy fire chief position with a battalion chief position.For over a decade, the Fire Department operated with two deputy chiefs, allowing for a division of responsibilities between Operations and Support Services.After functioning without two deputy chiefs for over a year, it has become evident to staff that the workload and scope of responsibilities for the department require two deputy chiefs to maintain department stability, especially considering the impending retirement of the sole current incumbent deputy chief in December.

Parks & Recreation
In the Parks & Recreation Department, staff is recommending eliminating the senior management analyst position and adding an administrative services manager position. This upgrade is necessary to streamline service delivery and maximize efficiency in departmental operations.The administrative services manager will oversee critical functions within the department, including recruitment, payroll time entry oversight, contracts management, vendor payments, and departmental budgeting. With this change, the department will have three divisions: Administration, Operations and Programing.The administrative services manager will have purview over the Administration Division, while the two current Parks & Recreation Superintendents positions will manage the Operations and Programming Divisions.

Police
For the Police Department, staff is requesting eliminating the senior management analyst position and adding a newly created facilities and administrative services manager position for the department. This new position will be responsible for overseeing the development of the department’s budgeting, financial services, and the management of police facilities. This will provide much needed relief to the workload of the incumbent police records and property manager.

With the budget reductions mandated last fiscal year, staffing was reduced through freezing positions to decrease costs through salary savings. The budget change has had a significant impacted on departmental staff. The current records and property manager is responsible for records, property, and evidence, including the offsite storage facility.The newly requested manager position will assume management of facilities to reduce the workload of the records and property manager and better align departmental resources to improve service delivery.

Public Works
In the Public Works Department, staff is requesting the elimination of the purchasing clerk position. This position, which was originally created for the Fleet Services Division was reassigned to the North Bay Regional Water Treatment Plant (NBR) in 2007.This position has not met the current operations needs of NBR for many years. With the retirement of the incumbent in August 2024, staff is recommending the elimination of this position and the work associated with it will be distributed among current staff at NBR without a significant impact to their current workloads.

FINANCIAL IMPACT
Packet Page 138 of 530

Agenda Item No: 12.AGENDA REPORTDATE:October 15, 2024 TO:Mayor and City CouncilFROM:David Gassaway, City ManagerSUBJECT:Resolution 2024251 of the City Council of the City of Fairfield Amending theDepartmental Position Control List of the Following Departments: CommunityDevelopment, Fire, Parks & Recreation, Police, and Public WorksRECOMMENDED ACTIONAdopt resolution.STATEMENT OF ISSUETo address staffing needs, improve service delivery, and align resources with council priorities andgoals, staff is requesting amendments to the Departmental Position Control List of the followingdepartments: Community Development, Fire, Parks & Recreation, Police, and Public Works.DISCUSSIONStaff recommends Departmental Position Control Lists are reviewed periodically to ensure that staffinglevels are aligned with the operational requirements of each department. Adjustments may benecessary to meet the changing needs of the city and to maintain efficient service delivery. Thefollowing proposed amendments reflect the necessary changes to support council priorities and goals.Community DevelopmentIn the Community Development Department, staff is requesting an addition of a newly created deputydirector position. This new role will provide additional managerial capacity to allow the department tobetter support and guide development services and provide crucial leadership and support forimproving permit processing at the department. The addition of a deputy director will allow thedepartment director to focus more on strategic growth initiatives and to work more closely with theeconomic development team. The financial impact of this position is partially offset by downgrading theeconomic development division manager to an economic development manager, as the latter positionis deemed more appropriate given the current structure and staffing levels. The downgrade reflects thereduced number of direct reports and adoption of a new economic development workplan, which ismore suited for a managerlevel position.FireIn the Fire Department, staff is requesting an additional battalion chief position for a limited term. Thelimitedterm battalion chief will be eliminated upon the retirement or separation of an incumbent in oneof the current permanent battalion chief positions. The deputy chief position was underfilled by abattalion chief when Chief Sturdee was appointed. By adding a limitedterm battalion chief position thesecond deputy chief position can be permanently refilled.Last fiscal year, all departments were directed to reduce their general fund budgets by 5%. To achievethis goal, the Fire Department underfilled the deputy fire chief position with a battalion chiefposition.For over a decade, the Fire Department operated with two deputy chiefs, allowing for adivision of responsibilities between Operations and Support Services.After functioning without twodeputy chiefs for over a year, it has become evident to staff that the workload and scope ofresponsibilities for the department require two deputy chiefs to maintain department stability, especiallyconsidering the impending retirement of the sole current incumbent deputy chief in December.Parks & RecreationIn the Parks & Recreation Department, staff is recommending eliminating the senior managementanalyst position and adding an administrative services manager position. This upgrade is necessary tostreamline service delivery and maximize efficiency in departmental operations.The administrativeservices manager will oversee critical functions within the department, including recruitment, payrolltime entry oversight, contracts management, vendor payments, and departmental budgeting. With thischange, the department will have three divisions: Administration, Operations and Programing.Theadministrative services manager will have purview over the Administration Division, while the twocurrent Parks & Recreation Superintendents positions will manage the Operations and ProgrammingDivisions.PoliceFor the Police Department, staff is requesting eliminating the senior management analyst position andadding a newly created facilities and administrative services manager position for the department. Thisnew position will be responsible for overseeing the development of the department’s budgeting,financial services, and the management of police facilities. This will provide much needed relief to theworkload of the incumbent police records and property manager.With the budget reductions mandated last fiscal year, staffing was reduced through freezing positions todecrease costs through salary savings. The budget change has had a significant impacted ondepartmental staff. The current records and property manager is responsible for records, property, andevidence, including the offsite storage facility.The newly requested manager position will assumemanagement of facilities to reduce the workload of the records and property manager and better aligndepartmental resources to improve service delivery.Public WorksIn the Public Works Department, staff is requesting the elimination of the purchasing clerk position. Thisposition, which was originally created for the Fleet Services Division was reassigned to the North BayRegional Water Treatment Plant (NBR) in 2007.This position has not met the current operations needsof NBR for many years. With the retirement of the incumbent in August 2024, staff is recommending theelimination of this position and the work associated with it will be distributed among current staff at NBRwithout a significant impact to their current workloads.

FINANCIAL IMPACT
PUBLIC CONTACT/ADVISORY BODY RECOMMENDATION
N/A
ALTERNATIVE ACTION
The council may choose to not approve the requested changes for the various departments and direct staff to find alternative means to achieve its goals.

STAFF CONTACT
Farbod Pirouzmand, Director of Human Resources
(707) 4287397
[email protected]
COORDINATED WITH
City Manager's Office, Finance Department, Fire Department, Parks and Recreation Department, Police Department, Public Works Department
ATTACHMENTS:

Description
Proposed Resolution
REVIEWERS:

Reviewer Action Date
Pirouzmand, Farbod Approved 10/1/2024 3:31 PM
Henry, Alicia Approved 10/1/2024 3:40 PM
Beavers, Esther Approved 10/1/2024 1:11 PM
Packet Page 139 of 530

CITY OF FAIRFIELD

RESOLUTION NO. 2024-251

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FAIRFIELD AMENDING THE DEPARTMENTAL POSITION CONTROL LIST OF THE FOLLOWING DEPARTMENTS: COMMUNITY

DEVELOPMENT, FIRE, PARKS & RECREATION, POLICE, AND PUBLIC WORKS

WHEREAS, the City Council approved the Departmental Position Control List , the listing of classifications and salaries; and

WHEREAS, changes to the Departmental Position Control List may only be made by Resolution of the City Council; and

WHEREAS, changes to the Departmental Position Control list are necessary to ensure the effective operations of services to the community; and

WHEREAS, changes to the Departmental Position Control list will amend position classifications for the Community Development, Fire, Parks & Recreation, Police, and Public Works Departments.

NOW, THEREFORE, THE COUNCIL OF THE CITY OF FAIRFIELD HEREBY RESOLVES:

Section 1. The City Council approves the following changes to the Departmental Control List for the following departments:

Community Development
Addition of 1.0 Deputy Director of Community and Economic Development Addition of 1.0 Economic Development Manager
Deletion of 1.0 Economic Development Division Manager

Fire
Addition of 1.0 FTE Battalion Chief (Limited Term)

Parks & Recreation
Addition of 1.0 Administrative Services Manager
Deletion of 1.0 Senior Management Analyst

Police
Addition of 1.0 FTE Administrative Services Manager
Deletion of 1.0 Senior Management Analyst
Deletion of 1.0 Police Department Records Assistant I

Public Works
Deletion of 1.0 FTE Purchasing Clerk

Packet Page 140 of 530Attachment 1 Page 1 of 2

RES. NO. 2024-251

Page 2 ends

Section 2. The city manager or their designee is authorized to make all administrative changes necessary to implement this resolution.

PASSED AND ADOPTED this 15th day of October 2024, by the following vote:

AYES: COUNCILMEMBERS: MOY/ BERTANI / CARR / PANDURO / TONNESEN / VACCARO / WILLIAMS

NOES: COUNCILMEMBERS:

ABSENT: COUNCILMEMBERS:

ABSTAIN: COUNCILMEMBERS:

MAYOR

ATTEST:

____________________________

CITY CLERK

Packet Page 141 of 530Attachment 1 Page 2 of 2

Agenda Item No: 13.

AGENDA REPORT
DATE:October 15, 2024
TO:Mayor and City Council
FROM:David Gassaway, City Manager
SUBJECT:Second Reading and Adoption of Ordinance 202408 of the City Council of the City of Fairfield Amending Chapter 10E of the Municipal Code, also Known as the Commercial Cannabis Business, to Allow for Administrative Changes to the Program and Operational Changes for Permittees
RECOMMENDED ACTION
Provide second reading and adopt Ordinance 202408.

STATEMENT OF ISSUE
The proposed ordinance would amend several sections of Chapter 10E of the Fairfield Municipal Code. The amended code would allow for the transfer of a Preliminary Approval of a Commercial Cannabis Business Permit, the expiration of a Preliminary Approval of a Commercial Cannabis Business Permit, a revised frequency of renewal for a Commercial Cannabis Business Permit, and changes to the signage regulations for businesses operating with a Commercial Cannabis Business Permit.

DISCUSSION
On August 20, 2024, a discussion was held to gather council's direction of possible amendments to Fairfield Municipal Code Chapter 10E. Based on the council’s direction and additional feedback from the public, the currently permitted cannabis retail operators in Fairfield, and internal stakeholders, the proposed ordinance has been drafted and is ready for council action. On October 1, 2024, a Public Hearing was held to introduce the ordinance, and the council took action to move this item forward to a second reading and adoption.

FINANCIAL IMPACT
If the ordinance is approved as presented, an adjustment will need to be made to the City’s fee schedule to incorporate a fee for the transfer of a Preliminary Approval for a Commercial Cannabis Business Permit as well as the request for an extension to for a Preliminary Approval for a Commercial Cannabis Business Permit. The fees will match the current fee for the transfer of a Commercial Cannabis Business Permit.

Packet Page 142 of 530

Agenda Item No: 13.AGENDA REPORTDATE:October 15, 2024 TO:Mayor and City CouncilFROM:David Gassaway, City ManagerSUBJECT:Second Reading and Adoption of Ordinance 202408 of the City Council of the City ofFairfield Amending Chapter 10E of the Municipal Code, also Known as theCommercial Cannabis Business, to Allow for Administrative Changes to the Programand Operational Changes for PermitteesRECOMMENDED ACTIONProvide second reading and adopt Ordinance 202408.STATEMENT OF ISSUEThe proposed ordinance would amend several sections of Chapter 10E of the Fairfield MunicipalCode. The amended code would allow for the transfer of a Preliminary Approval of a CommercialCannabis Business Permit, the expiration of a Preliminary Approval of a Commercial CannabisBusiness Permit, a revised frequency of renewal for a Commercial Cannabis Business Permit, andchanges to the signage regulations for businesses operating with a Commercial Cannabis BusinessPermit.DISCUSSIONOn August 20, 2024, a discussion was held to gather council's direction of possible amendments toFairfield Municipal Code Chapter 10E. Based on the council’s direction and additional feedback fromthe public, the currently permitted cannabis retail operators in Fairfield, and internal stakeholders, theproposed ordinance has been drafted and is ready for council action. On October 1, 2024, a PublicHearing was held to introduce the ordinance, and the council took action to move this item forward to asecond reading and adoption.FINANCIAL IMPACTIf the ordinance is approved as presented, an adjustment will need to be made to the City’s feeschedule to incorporate a fee for the transfer of a Preliminary Approval for a Commercial CannabisBusiness Permit as well as the request for an extension to for a Preliminary Approval for a CommercialCannabis Business Permit. The fees will match the current fee for the transfer of a Commercial Cannabis Business Permit.

PUBLIC CONTACT/ADVISORY BODY RECOMMENDATION
On October 1, 2024, public comment was made by representatives of one of the entities with a Commercial Cannabis Business Permit for a retail establishment; both commenter's encouraged the council to pass the ordinance.

ALTERNATIVE ACTION
The council may choose not to adopt the ordinance. It may also direct staff to make additional changes to the proposed ordinance before bringing the matter back to the council.

STAFF CONTACT
Dave Zellers, Director of Community and Economic Development (707) 4287436
[email protected]
COORDINATED WITH
City Attorney's Office, City Manager's Office
ATTACHMENTS:

Description
Proposed Ordinance
REVIEWERS:

Reviewer Action Date
Zellers, David Approved 10/2/2024 3:46 PM
Beavers, Esther Approved 10/2/2024 4:56 PM
Beavers, Esther Approved 10/2/2024 5:00 PM
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CITY OF FAIRFIELD

ORDINANCE NO. 2024-08

ORDINANCE OF THE CITY COUNCIL OF THE CITY OF FAIRFIELD AMENDING CHAPTER 10E OF

THE MUNICIPAL CODE, ALSO KNOWN AS COMMERCIAL CANNABIS BUSINESSES, TO ALLOW

FOR ADMINISTRATIVE CHANGES TO THE PROGRAM AND OPERATIONAL CHANGES FOR

PERMITTEES

THE CITY COUNCIL OF THE CITY OF FAIRFIELD DOES ORDAIN AS FOLLOWS:

SECTION 1. Statement of Intent

A. In 2020, the City adopted regulations for Commercial Cannabis Businesses, codified as Chapter 10E of the Fairfield Municipal Code. The city’s commercial cannabis business regulations create a permitting process through which retail, manufacturing, and testing laboratory cannabis businesses may operate in the city, and rules governing such operations are established consistent with state law.

B. In 2021, The City held an open application period for entities to pursue a permit to operate a retail, manufacturing, or testing laboratory business in the City. Pursuant to the City’s permitting process, the City Council granted four preliminary approvals to retail applicants and one preliminary approval to a manufacturing applicant.

C. The preliminary approval requires each applicant to satisfy certain conditions and receive all required land use approvals before it can be issued a commercial cannabis business permit.

To date, three of the retail applicants have satisfied the conditions of their preliminary approvals and received their commercial cannabis business permits.

D. The council has determined that various amendments to the Fairfield Municipal Code are needed for the efficient operation and regulation of commercial cannabis businesses.

E. This Ordinance imposes expiration dates on preliminary approvals for commercial cannabis permits, establishes a process by which applicants with preliminary approvals can transfer the approval to another entity, and makes other conforming edits to clarify the commercial cannabis business permit process.

SECTION 2. Subsection (f) of Section 10E.5 Definitions of Chapter 10E is hereby amended to read as follows:

“(f) "Commercial cannabis business permit" means a regulatory permit issued by the City pursuant to this Chapter to a commercial cannabis business and is required before any commercial cannabis activity may be conducted in the City. The initial permit and required Packet Page 144 of 530Attachment 1 Page 1 of 7

ORD. NO. 2024-08

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renewals are made expressly upon the business’ ongoing compliance with all the requirements of this Chapter and any applicable regulations adopted by the City.”

SECTION 3. Section 10E.5 Definitions of Chapter 10E is hereby amended to include the following definition in subsection (aa) as follows:

“(aa) “Preliminary approval” means an entity that has an approved application for a Commercial cannabis permit but has not yet completed all the requirements to receive the regulatory permit (Commercial Cannabis Business Permit) issued by the City pursuant to this Chapter.”

SECTION 4. Section 10E.10 Permit Expiration and Renewal of Chapter 10E is hereby amended in its entirety to read as follows:

“Section 10E.10 Expiration and Renewal of Permits or Preliminary Approvals .”

(a) Issuance of a commercial cannabis business permit does not create a property right or land use entitlement. Each commercial cannabis business permit shall expire twelve (12) months after the date of first issuance and again twelve (12) months after the date of the first renewal permit, as may be applicable. Subsequent renewal permits shall expire thirty-six (36) months after the issuance of the renewal permit. If the City Manager imposes additional conditions on a renewal permit, the renewal permit shall expire twelve (12) months after the date of renewal. No person or entity shall have any entitlement or vested right to receive a permit under this Chapter.

(b) Issuance of a preliminary approval does not create a property right or land use entitlement. Preliminary approvals issued prior to December 1, 2024, will expire on December 1, 2025. Preliminary approvals issued after December 1, 2024, will expire one (1) year after issuance. Preliminary approvals issued after December 1, 2024, can be extended for one (1) additional year subject to approval of the City Council provided the request for renewal is submitted prior to the expiration of the preliminary approval. A preliminary approval that has been transferred pursuant to Section 10.E.15 will expire one (1) year after the transfer is approved by the City Council.

(c) An application for renewal of a preliminary approval or commercial cannabis business permit must be filed at least 60 calendar days, but not more than 90 calendar days, prior to the expiration date of the approval or current permit.

(d) The renewal application shall contain all the information needed to determine compliance with permit conditions, as prescribed by the city manager.

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(e) The applicant shall pay a fee in an amount to be set by the City Council to cover the costs of processing the renewal application, together with any costs incurred by the City to administer the program created under this Chapter.

(f) The city manager shall approve or conditionally approve an application to renew a preliminary approval or commercial cannabis business permit, except where one or more of the following conditions exist:

(1) The application is filed less than 60 days before its expiration.

(2) The preliminary approval or commercial cannabis business permit is suspended or revoked at the time of the application.

(3) The commercial cannabis business has not been in regular and contin uous operation in the 4 months prior to the renewal application.

(4) The commercial cannabis business has failed to conform to the requirements of this Chapter, this Code, State law, any regulations adopted pursuant to this Chapter, or any permit conditions.

(5) The commercial cannabis business fails or is unable to renew its State license.

(g) The city manager may impose additional conditions on a renewal permit, if it is determined to be necessary to ensure compliance with State or local laws and regulations, or to preserve the public health, safety or welfare.

(h) If the City Manager denies the application for renewal, he or she shall specify in writing the reasons for the denial and notify the applicant that the decision shall become final unless the applicant files an appeal pursuant to this Chapter.

(i) An applicant whose application for renewal of a commercial cannabis business permit has been denied may not file a new application for a commercial cannabis business permit for one year from the date of the denial.

(j) Entities whose preliminary approval has expired pursuant to this Section may reapply for a preliminary approval during an open application period declared by the City Council.

There is no guarantee that the entity will receive a new preliminary approval and/or commercial cannabis business permit.”

SECTION 5. The title of Section 10E.11 Permit Suspension and Revocation of Chapter 10E is hereby amended to read as follows:

“10E.11 Suspension and Revocation of Permits or Preliminary Approvals.” Packet Page 146 of 530Attachment 1 Page 3 of 7

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SECTION 6. Subsection (b) of Section 10E.11 Permit Suspension and Revocation of Chapter 10E is hereby amended to read as follows:

“(b) The City Council may revoke a preliminary approval or a commercial cannabis business permit for a violation of any State or local law, including, but not limited to, this Chapter; a violation of any condition or term of the commercial cannabis business permit; and/or a violation of any condition or term made a part of any other permit or entitlement granted to the commercial cannabis business or its owner.”

SECTION 7. The title of Section 10E.15 Transfer of Cannabis Business Permit of Chapter 10E is hereby amended to read as follows:

“10E.15 Transfer of a Preliminary Approval or a Cannabis Business Permit.”

SECTION 8. Section 10E.15 Transfer of Cannabis Business Permit of Chapter 10E is hereby amended to include Subsection (e) as follows:

“(e) A commercial cannabis business may apply to transfer its preliminary approval to another entity pursuant to the requirements in Section 10E.9(g) through (l). The same requirements applicable to the transfer of a commercial cannabis business permit shall be applicable to the transfer of a preliminary approval. The entity to which a preliminary approval has been transferred must enter into an agreement with the City regarding the terms and conditions required to receive a commercial cannabis business permit and the expiration date of the transferred preliminary approval.”

SECTION 9. Section 10E.20 Records and Recordkeeping of Chapter 10E is hereby amended to read as follows:

“10E.20 Records and Recordkeeping.

(a) Each commercial cannabis business shall maintain accurate books and records in an electronic format, detailing all of the revenues and expenses of the business, and all of its assets and liabilities. On no less than an annual basis (at or before the time of the renewal of a commercial cannabis business permit issued pursuant to this Chapter), or at any time upon reasonab le request of the City, each commercial cannabis business shall file a sworn statement detailing the number of sales by the commercial cannabis business during the previous twelve-month period (or shorter period based upon the timing of the request), provided on a per-month basis. The statement shall also include gross sales for each month, and all applicable taxes and fees paid or due to be paid. On an annual basis, no later than March 31st of each year, the owner shall submit to the City a financial audit of the business’s operations conducted by Packet Page 147 of 530Attachment 1 Page 4 of 7

ORD. NO. 2024-08

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an independent certified public accountant. Each permittee shall be subject to a regulatory compliance review and financial audit as determined by the City Manager.

(b) Each commercial cannabis business shall maintain a current register of the names and contact information (including the address and telephone number) of anyone owning or holding an interest in the commercial cannabis business, and separately of all the officers, managers, employees, agents and volunteers currently employed or otherwise engaged by the commercial cannabis business. The register required by this paragraph shall be provided to the City Manager upon reasonable request.

(c) Each commercial cannabis business shall maintain an inventory control an d reporting system that accurately documents the present location, amounts, and descriptions of all cannabis and cannabis products for all stages of the growing and production or manufacturing, and laboratory testing processes until purchase as set forth in MAUCRSA.

(d) Each commercial cannabis business shall allow City officials access to the business’s books, records, and accounts, together with any other data or documents relevant to its permitted commercial cannabis activities, for the purpose of determining compliance with this Chapter. Books, records, accounts, and any and all relevant data or documents will be produced or made available no later than 24 hours after receipt of the City’s request, unless otherwise stipulated by the City. The City may requi re the materials to be submitted in an electronic format that is compatible with the City’s software and hardware. (Ord. No. 2020-07, § 1.)

SECTION 10. Subsection (f) of Section 10E.24 General Operating Requirements of Chapter 10E is hereby amended to read as follows:

“(f) Signage and Notices.

(1) In addition to the requirements otherwise set forth in this section, business identification signage for a commercial cannabis business shall conform to the requirements of the City’s Sign Ordinance, including, but not limited to, seeking the issuance of a City sign permit.

(2) No signs shall obstruct any entrance, exit, or window of the commercial cannabis business.

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(3) Each entrance shall be visibly posted with a clear and legible notice indicating that smoking, ingesting, or otherwise consuming cannabis on the premises or in the areas adjacent to the commercial cannabis business is prohibited.

(4) Business identification signage shall be limited to that needed for identification only and shall not contain any list of the services or the products offered; the word “dispensary” and the “green cross” symbol are permissible as part of the business identification signage. No commercial cannabis business shall advertise by having a person holding a sign and advertising the business to passersby, whether such person is on the premises of the commercial cannabis business or elsewhere including, but not limited to, the public right-of-way.

(5) No inflatables or billboards, or other prohibited signs may be used at any time.

Not more than one banner, flag, or portable sign may be used at any time to advertise on a permitted business’s premises; furthermore, the use of a banner, flag, or portable sign must also comply with Fairfield Municipal Code Chapter

25.1304C Specific Regulations for Temporary and Miscellaneous Signs.

(6) In accordance with State law, or as provided in the commercial cannabis business permit, the permittee shall agree to be prohibited from advertising any commercial cannabis business located in the City utilizing a billboard (fixed or mobile), bus shelter, placard, aircraft, or other similar forms of advertising. This paragraph is not intended to place limitations on the ability of a commercial cannabis business to advertise in other legally authorized forms, including on the internet, in magazines, or in other similar ways.”

SECTION 11. California Environmental Quality Act (CEQA). The Council finds that this Ordinance is not subject to the CEQA pursuant to CEQA Guidelines Section 15060(c)(3) because it is not a “project” as defined by Section 15378. Adoption of the Ordinance does not have the potential to result in either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment. Subsequent projects subject to the Ordinance will require a discretionary permit and CEQA review and will be analyzed at the appropriate time in accordance with CEQA. The Council further finds that if the Ordinance is considered a “project,” it is exempt from review under CEQA Guidelines Section 15061(b)(1), which exempts a project from CEQA if the project is exempt by statute. Business and Professions Code Section 26055(h) provides that Division 13 (commencing with Section 21000) of the Public Resources Code does not apply to the adoption of an ordinance, rule, or regulation by a local jurisdiction that requires discretionary review and approval of permits, licenses, or other authorizations to engage in commercial cannabis activity. Pursuant to that exemption, Chapter 10E of the Fairfield Municipal Code provides commercial cannabis businesses issued a commercial cannabis business permit must obtain all necessary land use approvals, including compliance with CEQA.

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SECTION 12. If any section or provision of this Ordinance is for any reason held to be invalid or unconstitutional by any court of competent jurisdiction or contravened by any reason of any preemptive legislation, the remaining sections and/or provisions of this Ordinance s hall remain valid. The council hereby declares that it would have adopted this Ordinance, and each section or provision thereof, regardless of the fact that any one or more section(s) or provision(s) may be declared invalid or unconstitutional or contraven ed via legislation.

SECTION 13. This Ordinance shall be effective 30 days following its adoption by the City Council.

A summary of this Ordinance shall be published within 15 days after its passage in accordance with Section 36933 of the California Government Code, with the names of the City Councilmembers voting for and against it.

INTRODUCED at a regular meeting of the City Council of Fairfield on the 1st day of October 2024 and

PASSED AND ADOPTED this 15th day of October 2024, by the following vote:

AYES: MEMBERS: MOY/BERTANI/CARR/PANDURO/TONNESEN/VACCARO/WILLIAMS NOES: MEMBERS: ___________________________________________________________ ABSENT: MEMBERS: ___________________________________________________________ ABSTAIN: MEMBERS: ___________________________________________________________

___________________________________________________________ MAYOR
ATTEST:
________________________________

CITY CLERK

Packet Page 150 of 530Attachment 1 Page 7 of 7

Agenda Item No: 14.

AGENDA REPORT
DATE:October 15, 2024
TO:Mayor and City Council
FROM:David Gassaway, City Manager
SUBJECT:Resolution 2024252 of the City Council of the City of Fairfield Approving a Contractor Services Agreement with Monarch Tree Services for Tree Pruning and Maintenance Services in Landscaping and Lighting Maintenance District No. 202311 (Paradise Valley) and Authorizing a Budget Adjustment to the Fiscal Year 20242025 Budget for Landscaping and Lighting Maintenance District No. 202311 RECOMMENDED ACTION
Adopt resolution.

STATEMENT OF ISSUE
Approval of the attached resolution will authorize the city manager to execute a contractor services agreement with Monarch Tree Services (Monarch) in the amount of $180,517 for tree pruning and maintenance services in Landscaping and Lighting Maintenance District No. 202311 (Paradise Valley) (District or LLMD No. 202311). The resolution will also authorize a onetime budget adjustment of $180,517 to increase appropriations in the fiscal year (FY) 20242025 LLMD No. 202311 operating budget for tree pruning and maintenance services.

DISCUSSION
LLMD No. 202311 was established in June 2023 to fund landscaping and lighting maintenance services for approximately 910,964 square feet of landscape, 1,875 trees, and 368 streetlights in the Paradise Valley area.

In September 2023, the City entered into a contractor services agreement with TerraCare Associates (TerraCare) to provide routine landscaping services, such as weekly lawn care, weed control, trash removal, and irrigation checks. In addition to routine services, TerraCare also provides minor as needed tree maintenance services, including walkway and street clearances and some hazard removal.

This limited service is intended to address isolated incidences of tree overgrowth, dead or diseased branches, and the removal of undesirable growths, such as suckers and water sprouts.

Proper and responsible tree care requires full pruning and maintenance performed by a certified arborist or a tree care professional every threetofive years, or as directed by the City arborist depending on the individual tree species and condition. Pruning is a horticultural practice that involves the selective removal of branches, buds, or roots and is done to improve and control the tree shape and size, manage and reduce disease or damage, promote healthy growth, and encourage flowering.

Pruning also helps trees develop a strong structure, making them less susceptible to storm or wind damage. Excessive pruning or pruning more frequently than recommended by an arborist can result in tree health deficiencies, structural weakness, stunted growth, decay, disease, or even the death of the tree. Due to the expertise required to perform this work, tree pruning services are normally procured and fulfilled under a contract separate from routine landscaping maintenance services.

At the time the District was formed, pruning and maintenance services for all trees in the Paradise Valley area were estimated at approximately $330,000 per service. The District’s initial Engineer’s Report adopted at the time of formation includes an annual special assessment levy of $109,375 (in FY 20232024 dollars, adjusted annually by the Consumer Price Index for inflation) for tree pruning services every three years. The actual amount collected for this purpose may vary from year to year depending on the overall district budget. These funds are placed in a reserve account to ensure its availability when needed.

In July 2024, the City solicited proposals for full pruning and maintenance services in LLMD No. 2023 11 from three professional tree care providers: Monarch, Hamilton Tree Service, Inc., and New Image Landscape Company.

In accordance with Chapter 28.31 of the Fairfield Municipal Code, the City selected Monarch based on their demonstrated competence and professional qualifications, which includes experience serving special districts, municipalities, and other government organizations. Their expertise in a full range of services include complete tree care management, landscape maintenance, water management planning, irrigation system maintenance, pest control, integrated plant healthcare, and drought mitigation. In addition, their capital resources, staffing capabilities, excellent performance under other City contracts and positive references affirmed their standing as the most qualified contractor for this work.

The approval of the attached resolution will authorize the city manager to execute a contractor services agreement with Monarch in the amount of $180,517 for tree pruning and maintenance services in LLMD No. 202311. The eightmonth term of the agreement beginning November 1, 2024, and ending June 30, 2025.

At the time the FY 20242025 budget was developed, no tree maintenance services were planned.

Therefore, no expenses for these services were included in the operating budget and all assessments collected for this purpose were placed in the reserve account. The attached resolution will also authorize a onetime budget adjustment of $180,517 to increase appropriations in the FY 20242025 LLMD No. 202311 operating budget for tree pruning and maintenance services. This increase will be funded using the District’s tree maintenance reserve funds, which is currently projected to have a balance of $189,375 at the end of FY 20242025.

FINANCIAL IMPACT
Total authorization for the Monarch contractor services agreement is $180,517 and will be paid from the LLMD No. 202311 (Paradise Valley) Fund (Organization and Object Code 188601078403).

Total authorization for a onetime budget adjustment of $180,517 to increase appropriations in the FY 20242025 LLMD No. 202311 operating budget (Organization and Object Code 188601078403) will be offset using the District’s tree maintenance reserve funds.

Packet Page 152 of 530

Agenda Item No: 14.AGENDA REPORTDATE:October 15, 2024 TO:Mayor and City CouncilFROM:David Gassaway, City ManagerSUBJECT:Resolution 2024252 of the City Council of the City of Fairfield Approving a ContractorServices Agreement with Monarch Tree Services for Tree Pruning and MaintenanceServices in Landscaping and Lighting Maintenance District No. 202311 (ParadiseValley) and Authorizing a Budget Adjustment to the Fiscal Year 20242025 Budget forLandscaping and Lighting Maintenance District No. 202311RECOMMENDED ACTIONAdopt resolution.STATEMENT OF ISSUEApproval of the attached resolution will authorize the city manager to execute a contractor servicesagreement with Monarch Tree Services (Monarch) in the amount of $180,517 for tree pruning andmaintenance services in Landscaping and Lighting Maintenance District No. 202311 (Paradise Valley)(District or LLMD No. 202311). The resolution will also authorize a onetime budget adjustment of$180,517 to increase appropriations in the fiscal year (FY) 20242025 LLMD No. 202311 operatingbudget for tree pruning and maintenance services.DISCUSSIONLLMD No. 202311 was established in June 2023 to fund landscaping and lighting maintenanceservices for approximately 910,964 square feet of landscape, 1,875 trees, and 368 streetlights in theParadise Valley area.In September 2023, the City entered into a contractor services agreement with TerraCare Associates(TerraCare) to provide routine landscaping services, such as weekly lawn care, weed control, trashremoval, and irrigation checks. In addition to routine services, TerraCare also provides minor asneeded tree maintenance services, including walkway and street clearances and some hazard removal.This limited service is intended to address isolated incidences of tree overgrowth, dead or diseasedbranches, and the removal of undesirable growths, such as suckers and water sprouts. Proper and responsible tree care requires full pruning and maintenance performed by a certifiedarborist or a tree care professional every threetofive years, or as directed by the City arboristdepending on the individual tree species and condition. Pruning is a horticultural practice that involvesthe selective removal of branches, buds, or roots and is done to improve and control the tree shape andsize, manage and reduce disease or damage, promote healthy growth, and encourage flowering.Pruning also helps trees develop a strong structure, making them less susceptible to storm or winddamage. Excessive pruning or pruning more frequently than recommended by an arborist can result intree health deficiencies, structural weakness, stunted growth, decay, disease, or even the death of thetree. Due to the expertise required to perform this work, tree pruning services are normally procuredand fulfilled under a contract separate from routine landscaping maintenance services.At the time the District was formed, pruning and maintenance services for all trees in the ParadiseValley area were estimated at approximately $330,000 per service. The District’s initial Engineer’sReport adopted at the time of formation includes an annual special assessment levy of $109,375 (in FY20232024 dollars, adjusted annually by the Consumer Price Index for inflation) for tree pruning servicesevery three years. The actual amount collected for this purpose may vary from year to year dependingon the overall district budget. These funds are placed in a reserve account to ensure its availability whenneeded. In July 2024, the City solicited proposals for full pruning and maintenance services in LLMD No. 202311 from three professional tree care providers: Monarch, Hamilton Tree Service, Inc., and New ImageLandscape Company. In accordance with Chapter 28.31 of the Fairfield Municipal Code, the City selected Monarch based ontheir demonstrated competence and professional qualifications, which includes experience servingspecial districts, municipalities, and other government organizations. Their expertise in a full range ofservices include complete tree care management, landscape maintenance, water managementplanning, irrigation system maintenance, pest control, integrated plant healthcare, and droughtmitigation. In addition, their capital resources, staffing capabilities, excellent performance under otherCity contracts and positive references affirmed their standing as the most qualified contractor for thiswork.The approval of the attached resolution will authorize the city manager to execute a contractor servicesagreement with Monarch in the amount of $180,517 for tree pruning and maintenance services in LLMDNo. 202311. The eightmonth term of the agreement beginning November 1, 2024, and ending June30, 2025. At the time the FY 20242025 budget was developed, no tree maintenance services were planned.Therefore, no expenses for these services were included in the operating budget and all assessmentscollected for this purpose were placed in the reserve account. The attached resolution will alsoauthorize a onetime budget adjustment of $180,517 to increase appropriations in the FY 20242025LLMD No. 202311 operating budget for tree pruning and maintenance services. This increase will befunded using the District’s tree maintenance reserve funds, which is currently projected to have abalance of $189,375 at the end of FY 20242025.FINANCIAL IMPACTTotal authorization for the Monarch contractor services agreement is $180,517 and will be paid from theLLMD No. 202311 (Paradise Valley) Fund (Organization and Object Code 188601078403).Total authorization for a onetime budget adjustment of $180,517 to increase appropriations in the FY20242025 LLMD No. 202311 operating budget (Organization and Object Code 188601078403) will be offset using the District’s tree maintenance reserve funds.

PUBLIC CONTACT/ADVISORY BODY RECOMMENDATION
N/A
ALTERNATIVE ACTION
The council may choose not to approve the attached resolution, then the District will not provide tree pruning services in FY 20242025.

STAFF CONTACT
Chris Lewis, Sr. Management Analyst
(707) 4287089
[email protected]
COORDINATED WITH
N/A
ATTACHMENTS:

Description
Proposed Resolution
Proposed Contractor Service Agreement for LLMD No. 202311 REVIEWERS:

Reviewer Action Date
Chaudhary, Savita Approved 10/8/2024 12:35 PM
Beavers, Esther Approved 10/8/2024 1:16 PM
Beavers, Esther Approved 10/8/2024 1:17 PM
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CITY OF FAIRFIELD

RESOLUTION NO. 2024-252

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FAIRFIELD APPROVING A CONTRACTOR

SERVICES AGREEMENT WITH MONARCH TREE SERVICES FOR TREE PRUNING AND MAINTENANCE SERVICES IN LANDSCAPING AND LIGHTING MAINTENANCE DISTRICT NO. 2023-11 (PARADISE VALLEY) AND AUTHORIZING A BUDGET ADJUSTMENT TO THE FISCAL YEAR 2024-2025 BUDGET FOR LANDSCAPING AND LIGHTING MAINTENANCE DISTRICT NO. 2023-11

WHEREAS, on June 7, 2023, the City formed Landscaping and Lighting Maintenance District No. 2023-11 (Paradise Valley) (District or LLMD No. 2023-11) to replace Landscaping and Lighting Maintenance District No. 11 – Paradise Valley North and provide all landscaping and lighting maintenance services in the Paradise Valley community beginning July 1, 2023; and

WHEREAS, in September 2023, the City entered into a contractor services agreement with TerraCare Associates to provide routine landscaping services, which excludes specialized tree pruning services; and

WHEREAS, trees in the Paradise Valley area require full pruning and maintenance service; and

WHEREAS, pursuant to Chapter 28.31 of the Fairfield Municipal Code, contracts for landscape maintenance services may be let on the basis of demonstrated competence and professional qualifications; and

WHEREAS, the City solicited proposals for full pruning and maintenance services in LLMD No. 2023-11 from three professional tree care providers, Monarch Tree Services (Monarch), Hamilton Tree Service, Inc., and New Image, and selected Monarch as the most qualified provider; and

WHEREAS, costs for tree pruning services were not included in the fiscal year (FY) 2024-2025 operating budget, thus requiring an adjustment of $180,517 to cover the costs; and

WHEREAS, the revised appropriation constitutes an update to the FY 2024-2025 Budget approved pursuant to Resolution No. 2024-133.

NOW, THEREFORE, THE COUNCIL OF THE CITY OF FAIRFIELD HEREBY RESOLVES:

Section 1. The city manager is hereby authorized and directed to execute the contractor services agreement between the City and Monarch for tree pruning and maintenance services in LLMD No. 2023-11 in the amount of $180,517 for an eight-month term beginning November 1, 2024, and ending June 30, 2025.

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Section 2. The council hereby approves a one-time budget adjustment of $180,517 from LLMD No. 2023-11 (Paradise Valley)’s tree maintenance reserve funds (Fund 188) to its operating budget (Organization and Object Code 18860107-8403).

Section 3. The council hereby approves an increase in appropriations of $180,517 to the FY 2024- 2025 LLMD No. 2023-11 (Fund 188) operating budget.

Section 4. The public works director or designee is authorized and directed to do all things necessary to implement the Agreement and budget adjustment.

PASSED AND ADOPTED this 15th day of October 2024, by the following vote:

_________________________________________________
MAYOR
ATTEST:
___________________________

CITY CLERK

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1 CONTRACTOR SERVICES AGREEMENT

TREE PRUNING AND MAINTENANCE SERVICES IN LANDSCAPING AND LIGHTING MAINTENANCE DISTRICT NO. 2023-11 (PARADISE VALLEY)

THIS AGREEMENT is made at Fairfield, California, as of _______________, 2024, by and between the City of Fairfield, a municipal corporation Monarch Tree Services ("CONTRACTOR"), who agree as follows:

1) SERVICES. Subject to the terms and conditions set forth in this Agreement, CONTRACTOR submitted by CONTRACTOR. CONTRACTOR shall provide said services at the time, place, and

2) PAYMENT. CITY shall pay CONTRACTOR for services rendered pursuant to this Agreement at shall be the only payments to be made to CONTRACTOR for services rendered pursuant to this Agreement. CONTRACTOR shall submit all billings for said services to the CITY in the

3) FACILITIES AND EQUIPMENT. CONTRACTOR shall, at its sole cost and expense, furnish all facilities and equipment which may be required for furnishing services pursuant to this Agreement.

4) GENERAL PROVISIONS. The general provisions set forth in the City of Fairfield Standard the
event of any inconsistency between said general provisions and any other terms or conditions

5) INSURANCE REQUIREMENTS
this Agreement. In the event of any inconsistency between said general provisions and any control.

6) BUSINESS LICENSE. The CONTRACTOR shall obtain and keep current a business license for work within the City of Fairfield pursuant to Chapter 10B of the Fairfield City Code, with respect to the gross receipts received pursuant to this Agreement. No payments shall be made to any CONTRACTOR until such business license has been obtained, and all fees paid therefore, by the CONTRACTOR. Business license applications and information may be obtained from the Community Development Department, Fairfield City Hall, 1000 Webster Street, Fairfield, CA 94533-4883, (707-428-7509) and online at www.fairfield.ca.gov/biz

7) EXHIBITS. All exhibits referred to herein are attached hereto and are by this reference incorporated herein.

8) TERM. This agreement shall be from November 1, 2024, through June 30, 2025.

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2 9) Where applicable, vehicles with a GVWR greater than 8,500 lbs. and light-duty package delivery vehicles operated in California may be subject to the California Air Resources Board Advanced Clean Fleets regulations. Such vehicles may therefore be subject to requirements to reduce emissions of air pollutants. For more information, please visit the CARB Advanced Clean Fleets webpage at https://ww2.arb.ca.gov/our-work/programs/advanced-clean- fleets

EXECUTED as of the day first above-stated.

City of Fairfield, a municipal corporation

By: ________
David Gassaway, City Manager

Monarch Tree Services,

By: _______
Patrick Belhumeur, Regional Branch Manager
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3 SCOPE OF SERVICE
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4 PAYMENT
1) The total contract price for services rendered by CONTRACTOR under this Agreement shall not exceed $180,517.
2) Payment shall be made to CONTRACTOR based on monthly progress billings and final invoice. 3)
mutually agreed to by the CITY and CONTRACTOR and shall be billed on a time and materials basis to the City of Fairfield.

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5 GENERAL PROVISIONS
1) INDEPENDENT CONTRACTOR. At all times during the term of this Agreement, CONTRACTOR shall be an independent Contractor and shall not be an employee of CITY. CITY shall have the right to control CONTRACTOR only insofar as the results of CONTRACTOR's services rendered pursuant to this Agreement; however, CITY shall not have the right to control the means by which CONTRACTOR accomplishes services rendered pursuant to this Agreement. 2) LICENSES; PERMITS; ETC. CONTRACTOR represents and warrants to CITY that CONTRACTOR has all licenses, permits, qualifications, and approvals of whatsoever nature which are legally required for CONTRACTOR to practice CONTRACTOR's profession. CONTRACTOR represents and warrants to CITY that CONTRACTOR shall, at its sole cost and expense, keep in effect at all times during the term of this Agreement, any licenses, permits, and approvals which are legally required for CONTRACTOR to practice his profession. 3) TIME. CONTRACTOR shall devote such services pursuant to this Agreement as may be reasonably necessary for satisfactory performance of CONTRACTOR's obligations pursuant to this Agreement. CONTRACTOR shall adhere to the Schedule of Activities as described in their Executive Summary.
4) CONTRACTOR NOT AN AGENT. Except as CITY may specify in writing, CONTRACTOR shall have no authority, express or implied, to act on behalf of CITY in any capacity whatsoever as an agent. CONTRACTOR shall have no authority, express or implied, pursuant to this Agreement, to bind CITY to any obligation whatsoever.
5) ASSIGNMENT PROHIBITED. No party to this Agreement may assign any right or obligation pursuant to this Agreement. Any attempted or purported assignment of any right or obligation pursuant to this Agreement shall be void and of no effect. 6) PERSONNEL. CONTRACTOR shall assign only competent personnel to perform services pursuant to this Agreement. In the event that CITY, in its sole discretion, at anytime during the term of this Agreement, desires the removal of any person or persons assigned by CONTRACTOR to perform services pursuant to this Agreement, CONTRACTOR shall remove any such person immediately upon receiving notice from CITY of the desire of CITY for the removal of such person or persons.
7) STANDARD OF PERFORMANCE. CONTRACTOR shall perform all services required pursuant to this Agreement. Services shall be performed in the manner and according to the standards observed by a competent practitioner of the profession in which CONTRACTOR is engaged in the geographical area in which CONTRACTOR practices his profession. All products which CONTRACTOR delivers to CITY pursuant to this Agreement shall be prepared in a workmanlike manner, and conform to the standards of quality normally observed by a person practicing in CONTRACTOR's profession. CITY shall be the sole judge as to whether the product of the CONTRACTOR is satisfactory.

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6 8) CANCELLATION OF AGREEMENT. This Agreement may be canceled at any time by the CITY at its discretion upon written notification to CONTRACTOR. CONTRACTOR is entitled to receive full payment for all services performed and all costs incurred up to and including the date of receipt of written notice to cease work on the project. CONTRACTOR shall be entitled to no further compensation for work performed after the date of receipt of written notice to cease work. All completed and incomplete products up to the date of receipt of written notice to cease work shall become the property of CITY.
9) PRODUCTS OF CONSULTING. All products of the CONTRACTOR created under this Agreement shall be the property of the CITY.
10) INDEMNIFY AND HOLD HARMLESS. CONTRACTOR shall indemnify, defend, and hold harmless the CITY, its officers, agents, employees and volunteers from all claims, suits, or actions of every name, kind and description, brought forth on account of injuries to or death of any person or damage to property arising from or connected with the willful misconduct, negligent acts, errors or omissions, ultra-hazardous activities, activities giving rise to strict liability, or defects in design by CONTRACTOR or any person directly or indirectly employed by or acting as agent for CONTRACTOR in the performance of this Agreement, including the concurrent or successive passive negligence of the CITY, its officers, agents, employees or volunteers.

It is understood that the duty of CONTRACTOR to indemnify and hold harmless includes the duty to defend as set forth in Section 2778 of the California Civil Code.

Acceptance of insurance certificates and endorsements required under this Agreement does not relieve CONTRACTOR from liability under this indemnification and hold harmless clause. This indemnification and hold harmless clause shall apply whether or not such insurance policies are determined to be applicable to any such damages or claims for damages. 11) PROHIBITED INTERESTS. No employee of the CITY shall have any direct financial interest in this agreement. This agreement shall be voidable at the option of the CITY if this provision is violated.
12) LOCAL EMPLOYMENT POLICY. The CITY desires wherever possible, to hire qualified local residents to work on city projects. Local resident is defined as a person who resides in Solano County. The CITY encourages an active affirmative action program on the part of its contractors, consultants and developers. When local projects require, subcontractors, contractors, consultants and developers will solicit proposals from qualified local firms where possible.

As a way of responding to the provisions of the Davis-Bacon Act and this program, contractor, consultants, and developers will be asked, to provide no more frequently than monthly, a report which lists the employee's name, job class, hours worked, salary paid, city of residence, and ethnic origin.
13) CONTRACTOR NOT A PUBLIC OFFICIAL. CONTRACTOR is not a "public official" for purposes of Government Code §§ 87200 et seq. CONTRACTOR conducts research and arrives at his or her conclusions, advice, recommendation, or counsel independent of the control and direction Packet Page 192 of 530Attachment 2 Page 37 of 45

7 of the CITY or any CITY official, other than normal contract monitoring. In addition, CONTRACTOR possesses no authority with respect to any CITY decision beyond these conclusions, advice, recommendation, or counsel.
14) EMPLOYMENT DEVELOPMENT DEPARTMENT REPORTING REQUIREMENTS. When the CITY executes an agreement for or makes payment to CONTRACTOR in the amount of $600 (six hundred dollars) or more in any one calendar year, CONTRACTOR shall provide the following information to CITY to comply with Employment Development Department (EDD) reporting requirements:
a) Whether CONTRACTOR is doing business as a sole proprietorship, partnership, limited liability partnership, corporation, limited liability corporation, non-profit corporation or other form of organization.
b) If CONTRACTOR is doing business as a sole proprietorship, CONTRACTOR shall provide the full name, address and social security number or federal tax identification number of the sole proprietor.
c) If CONTRACTOR is doing business as other than a sole proprietorship,

15) LABOR AND WAGE CODE GUIDELINES. Attention is directed to Section 1777.5 of the Labor Code as it applies to Apprenticeship Standards.

The general prevailing wage rates for each craft, classification, or type of workman shall be determined by the Director of Industrial Relations (available online at http://www.dir.ca.gov/dlsr/PWD/index.html - select the appropriate wage decision and then collect the wage decisions for Statewide, Northern California and Solano County). A copy of these wage rate determination are kept on file are available for review at the Office of the City Engineer located at 1000 Webster Street.

In accordance with the provisions of Section 1860 of the California labor Code, attention is directed to the requirement that in accordance with the provisions of Section 3700 of the California Labor Code, every contactor will be required to secure the payment of compensation of his or her employees.

Attention is directed to the Federal Minimum wage rate requirements. If there is a difference between the minimum wage rates predetermined by the Secretary of Labor and the general prevailing wage rates determined by the Director of the California Department of Industrial relations for similar classifications of labor, the Contractor and subcontractors shall pay not less than the higher wage rates. The Department will not accept lower State wage rates not specifically included in the Federal minimum wage determinations. Where Federal wage determinations do not contain the State wage rate determination otherwise available for use by the Contractor and subcontractors, the Contractor and subcontractors shall pay not less than the Federal minimum wage rates, which most closely approximates the duties of the Packet Page 193 of 530Attachment 2 Page 38 of 45

8 INSURANCE REQUIREMENTS
CONSULTANT shall procure and maintain for the duration of the contract insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the work hereunder by the CONSULTANT, its agents, representatives, or employees. 1) MINIMUM SCOPE AND LIMITS OF INSURANCE
a) Commercial General Liability coverage (occurrence Form CG 00 01) with minimum limits of $1,000,000 per occurrence for bodily injury, personal injury, products and completed operations, and property damage. If Commercial General Liability or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to this project/location or the general aggregate limit shall be twice the required occurrence limit.
b) Automobile Liability coverage (Form CA 00 01 with Code 1 any auto) with minimum limits of $1,000,000 per accident for bodily injury and property damage. c)
Liability insurance, each in the amount of $1,000,000 per accident for bodily injury or disease. 2) INDUSTRY SPECIFIC COVERAGES
If checked below, the following insurance is also required.

Professional Liability Insurance / Errors and Omissions Liability in the minimum amount of $1,000,000 per occurrence.

Pollution Liability Insurance in the minimum amount of $1,000,000 per occurrence Garage Keepers Insurance in the minimum amount of $1,000,000 per occurrence Fidelity / Crime / Dishonesty Bond in the minimum amount of $____________ MCS-90 Endorsement to Business Automobile insurance for transportation of hazardous materials and pollutants

3) INSURANCE PROVISIONS
a) DEDUCTIBLES AND SELF-INSURED RETENTIONS. Any deductibles or self-insured retentions must be declared to and approved by the CITY. At the option of the CITY, either the insurer shall reduce or eliminate such deductibles or self-insured retentions as respects the CITY, its officers, officials, employees and volunteers; or the CONSULTANT shall procure a bond guaranteeing payment of losses and related investigations, claim administration and defense expenses. b) The general and automobile liability policies (and if applicable, pollution liability, garage keepers

i) The CITY, its officers, officials, employees and volunteers are to be covered as insureds as Packet Page 194 of 530Attachment 2 Page 39 of 45

9 respects: liability arising out of work or operations performed by or on behalf of the CONSULTANT; products and completed operations of the CONSULTANT; premises owned, occupied or used by the CONSULTANT; and automobiles owned, leased, hired or borrowed by the CONSULTANT. The coverage shall contain no special limitations on the scope of protection afforded to the CITY, its officers, officials, employees or volunteers. ii)
insurance as respects the CITY, its officers, officials, employees and volunteers. Any insurance or self-insured maintained by the CITY, its officers, officials, employees or volunteers shall be in

iii) Any failure to comply with reporting or other provisions of the policies including breaches of warranties shall not affect coverage provided to the CITY, its officers, officials, employees or volunteers.
iv)

v) Each insurance policy required by this clause shall be endorsed to state that coverage shall not be suspended, voided, canceled by either party, reduced in coverage or in limits except after receipt requested, has been given
to the CITY.
vi) The policy limits of coverage shall be made available to the full limits of the policy. The minimum Therefore, the requirements for coverage and limits shall be (1) the minimum coverage and limits specified in this agreement, or (2) the broader coverage and maximum limits of coverage of any insurance policy or proceeds available to the named insured, whichever is greater. c) ACCEPTABILITY OF INSURER.
of no less than A:VII, unless otherwise acceptable to the CITY.

VERIFICATION OF COVERAGE. CONSULTANT shall furnish the CITY with original endorsements effecting coverage required by this Exhibit D. The endorsements are to be signed by a person authorized by that insurer to bind coverage on its behalf; on forms equivalent to CG 20 10 11 85, subject to CITY approval; and submitted electronically through the Exigis insurance system to: [email protected].

All insurance certificates and endorsements are to be received and approved by the CITY before work commences. At the request of the CITY, CONSULTANT shall provide complete, certified copies of all required insurance policies, including endorsements affecting the coverage required by these specifications. d) SUB-CONTRACTORS. CONSULTANT shall require all subcontractors to procure and maintain insurance policies subject to the requirements of Exhibit D. Failure of CONSULTANT to verify existence of sub- from sub-contractors work on
behalf of CONSULTANT.

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Envelope Id: 34949023FB6A4765B8AD958F2AD0D651 Status: Completed Subject: Complete with Docusign: CSA - Monarch Tree Services.pdf Source Envelope:

Document Pages: 40 Signatures: 1 Envelope Originator:

Certificate Pages: 5 Initials: 0 Christiana Lewis
AutoNav: Enabled
EnvelopeId Stamping: Enabled
Time Zone: (UTC-08:00) Pacific Time (US & Canada)
1000 Webster Street
Community Development - Building Services
Fairfield, CA 94533
[email protected]
IP Address: 64.162.152.2
Status: Original
10/7/2024 11:40:36 AM
Holder: Christiana Lewis
[email protected]
Location: DocuSign
Security Appliance Status: Connected Pool: StateLocal
Storage Appliance Status: Connected Pool: City of Fairfield Location: DocuSign Patrick Belhumeur
[email protected]
Security Level: Email, Account Authentication
(None)
Signature Adoption: Pre-selected Style
Using IP Address: 98.59.144.218
Sent: 10/7/2024 11:42:32 AM
Viewed: 10/7/2024 1:15:51 PM
Signed: 10/7/2024 1:16:00 PM
Accepted: 10/7/2024 1:15:51 PM
ID: 1dd7157f-2e5d-43f0-830e-fc48a7cabdfa
Gary Sponsler
[email protected]
Security Level: Email, Account Authentication
(None)
Sent: 10/7/2024 11:42:33 AM
Viewed: 10/7/2024 11:44:10 AM
Accepted: 7/22/2024 9:26:51 AM
ID: 48ffc4a1-1113-4cb1-8110-6c9dd682b53d
Nichole Chavez
[email protected]
Security Level: Email, Account Authentication
(None)
Sent: 10/7/2024 11:42:33 AM
Viewed: 10/7/2024 12:55:51 PM
Not Offered via DocuSign
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Envelope Sent Hashed/Encrypted 10/7/2024 11:42:34 AM
Certified Delivered Security Checked 10/7/2024 1:15:51 PM Signing Complete Security Checked 10/7/2024 1:16:00 PM
Completed Security Checked 10/7/2024 1:16:00 PM
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ELECTRONIC RECORD AND SIGNATURE DISCLOSURE
From time to time, City of Fairfield (we, us or Company) may be required by law to provide to you certain written notices or disclosures. Described below are the terms and conditions for providing to you such notices and disclosures electronically through the DocuSign system.

Please read the information below carefully and thoroughly, and if you can access this information electronically to your satisfaction and agree to this Electronic Record and Signature Disclosure (ERSD), please confirm your agreement by selecting the check- system.

Getting paper copies
At any time, you may request from us a paper copy of any record provided or made available electronically to you by us. You will have the ability to download and print documents we send to you through the DocuSign system during and immediately after the signing session and, if you elect to create a DocuSign account, you may access the documents for a limited period of time (usually 30 days) after such documents are first sent to you. After such time, if you wish for us to send you paper copies of any such documents from our office to you, you will be charged a $0.00 per-page fee. You may request delivery of such paper copies from us by following the procedure described below.

Withdrawing your consent
If you decide to receive notices and disclosures from us electronically, you may at any time change your mind and tell us that thereafter you want to receive required notices and disclosures only in paper format. How you must inform us of your decision to receive future notices and disclosure in paper format and withdraw your consent to receive notices and disclosures electronically is described below.

Consequences of changing your mind
If you elect to receive required notices and disclosures only in paper format, it will slow the speed at which we can complete certain steps in transactions with you and delivering services to you because we will need first to send the required notices or disclosures to you in paper format, and then wait until we receive back from you your acknowledgment of your receipt of such paper notices or disclosures. Further, you will no longer be able to use the DocuSign system to receive required notices and consents electronically from us or to sign electronically documents from us.

All notices and disclosures will be sent to you electronically Packet Page 198 of 530Attachment 2 Page 43 of 45

Unless you tell us otherwise in accordance with the procedures described herein, we will provide electronically to you through the DocuSign system all required notices, disclosures, authorizations, acknowledgements, and other documents that are required to be provided or made available to you during the course of our relationship with you. To reduce the chance of you inadvertently not receiving any notice or disclosure, we prefer to provide all of the required notices and disclosures to you by the same method and to the same address that you have given us. Thus, you can receive all the disclosures and notices electronically or in paper format through the paper mail delivery system. If you do not agree with this process, please let us know as described below. Please also see the paragraph immediately above that describes the consequences of your electing not to receive delivery of the notices and disclosures electronically from us.

How to contact City of Fairfield:

You may contact us to let us know of your changes as to how we may contact you electronically, to request paper copies of certain information from us, and to withdraw your prior consent to receive notices and disclosures electronically as follows:

To contact us by email send messages to: [email protected]

To advise City of Fairfield of your new email address
To let us know of a change in your email address where we should send notices and disclosures electronically to you, you must send an email message to us at [email protected] and in the body of such request you must state: your previous email address, your new email address. We do not require any other information from you to change your email address.

If you created a DocuSign account, you may update it with your new email address through your account preferences.

To request paper copies from City of Fairfield
To request delivery from us of paper copies of the notices and disclosures previously provided by us to you electronically, you must send us an email to [email protected] and in the body of such request you must state your email address, full name, mailing address, and telephone number. We will bill you for any fees at that time, if any.

To withdraw your consent with City of Fairfield
To inform us that you no longer wish to receive future notices and disclosures in electronic format you may:

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i. decline to sign a document from within your signing session, and on the subsequent page, select the check-box indicating you wish to withdraw your consent, or you may; ii. send us an email to [email protected] and in the body of such request you must state your email, full name, mailing address, and telephone number. We do not need any other information from you to withdraw consent.. The consequences of your withdrawing consent for online documents will be that transactions may take a longer time to process..

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The minimum system requirements for using the DocuSign system may change over time. The current system requirements are found here: https://support.docusign.com/guides/signer-guide- signing-system-requirements.

Acknowledging your access and consent to receive and sign documents electronically To confirm to us that you can access this information electronically, which will be similar to other electronic notices and disclosures that we will provide to you, please confirm that you have read this ERSD, and (i) that you are able to print on paper or electronically save this ERSD for your future reference and access; or (ii) that you are able to email this ERSD to an email address where you will be able to print on paper or save it for your future reference and access. Further, if you consent to receiving notices and disclosures exclusively in electronic format as described herein, then select the check-

By selecting the check-onfirm
that:

You can access and read this Electronic Record and Signature Disclosure; and You can print on paper this Electronic Record and Signature Disclosure, or save or send this Electronic Record and Disclosure to a location where you can print it, for future reference and access; and
Until or unless you notify City of Fairfield as described above, you consent to receive exclusively through electronic means all notices, disclosures, authorizations, acknowledgements, and other documents that are required to be provided or made available to you by City of Fairfield during the course of your relationship with City of Fairfield.

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Agenda Item No: 15.

AGENDA REPORT
DATE:October 15, 2024
TO:Mayor and City Council
FROM:David Gassaway, City Manager
SUBJECT:Resolution 2024253 of the City Council Authorizing the Issuance of Special Tax Bonds for the City of Fairfield Community Facilities District No. 20231 (One Lake Planning Area 5) with Respect to Improvement Area No. 1, and Approving Related Documents and Actions
RECOMMENDED ACTION
Adopt resolution and approve related documents and actions.

STATEMENT OF ISSUE
The City Council previously conducted proceedings under the MelloRoos Community Facilities Act of 1982 (MelloRoos Act) to form (i) “City of Fairfield Community Facilities District No. 20231 (One Lake Planning Area 5)” (CFD 20231) and (ii) “Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 20231 (One Lake Planning Area 5)” (Improvement Area No. 1).

As a separate matter on tonight’s agenda, staff is recommending that the City Council continue change proceedings for the CFD 20231 and Improvement Area No. 1 (Change Proceedings), including a public hearing, a landowner election and introduction of an ordinance levying special taxes. If the council adopts staff’s recommendation, the Change Proceedings would be complete with adoption of the ordinance on November 19, 2024.

As part of this matter, staff recommends that the council adopt the attached resolution in order to authorize the sale of Special Tax Bonds, Series 2024A (2024A Bonds) with respect to Improvement Area No. 1 in an amount not to exceed $36,500,000 and approve related documents and actions, including the Preliminary Official Statement, Continuing Disclosure Certificate, Fiscal Agent Agreement, and Bond Purchase Agreement.

DISCUSSION
Background Information About the One Lake Project and the Related Development Agreement.On August 16, 2011, the council entered into a Development Agreement (Development Agreement) with Canon Station LLC regarding approximately 1,570 acres within the Train Station Specific Plan (TSSP) Area. Canon Station LLC was the master developer of a 358.5acre master Packet Page 201 of 530

The current master developer of the One Lake Project is One Lake Holding LLC (Master Developer).

On September 3, 2024, the council adopted an ordinance approving the 5th Amendment to the Development Agreement. The 5th Amendment increases the maximum combined tax rate, as defined in the 5th Amendment, from 1.65% to 1.75%.

The Master Developer expects the One Lake Project to be developed in numerous phases that will ultimately consist of 1,937 singlefamily and multifamily homes and a 190unit apartment complex, with approximately 20,000 square feet of commercial/retail space. The Master Developer is not a homebuilder and is developing the property through the sale of finished lots to merchant builders.

Improvement Area No. 1 comprises the majority of Planning Area 5. Planning Area 4 is within a separate community facilities district previously formed by the City and known as the City of Fairfield Community Facilities District No. 20191 (One Lake).

Proposed 2024A Bonds.The City is authorized to levy special taxes and incur indebtedness for and on behalf of CFD 20231 to finance the costs of infrastructure associated with the One Lake Project.

The City will use the proceeds of the 2024A Bonds to acquire authorized public improvements from the Master Developer. Pursuant to the resolution, the effective interest rate on the 2024A Bonds cannot exceed 6%. Based on current market conditions, the 2024A Bonds are estimated to be issued in the amount of $36,500,000 and carry a true interest cost of approximately 5.37%.

Based on the appraisal completed by BBG, Inc., the value of the property in Improvement Area No. 1 has been determined to be not less than $110,300,000 as of August 28, 2024. Pursuant to a waiver by the council in the Change Proceedings of a 4:1 valueto lien requirement in the City’s local goals and policies for community facilities districts, the value to lien ratio (which compares the market value of the property in Improvement Area No. 1 to the proposed principal amount of the 2024A Bonds to be issued and bonds issued by overlapping community facilities districts and assessment districts) for the 2024A Bonds will be at least 3:1.

The financing is expected to close in November 2024. Debt service on the 2024A Bonds is payable only from special taxes levied annually on taxable properties within Improvement Area No. 1 of CFD 20231 in the manner set forth in the Amended and Restated Rate and Method of Apportionment of Special Tax (RMA) approved by the council in the Change Proceedings. The 2024A Bonds will not have any impact on the City’s General Fund.

Proposed Resolution and Related Documents.In order to complete the financing, the council is being asked to approve each of the following:
• Resolution.Resolution of the council authorizing the issuance of bonds for CFD 20231 with respect to Improvement Area No. 1, and approving related documents and actions. • Preliminary Official Statement.The Official Statement is the primary disclosure document for investors in the 2024A Bonds. A Preliminary Official Statement will be circulated to potential investors prior to the pricing of the 2024A Bonds. After the 2024A Bonds have been priced, a Final Official Statement will be circulated to investors; the Final Official Statement should be identical to the Preliminary Official Statement except for the addition of pricing information (principal amount, interest rates, redemption terms).

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The Preliminary Official Statement describes the special taxes to be levied in the Improvement Area No. 1 and the development plans and status for the property within Improvement Area No. 1, and information on the Master Developer and merchant builders for Improvement Area No. 1, currently Lennar Homes. The Preliminary Official Statement will also include the appraisal of the taxable parcels in Improvement Area No. 1.

The Preliminary Official Statement is prepared by Jones Hall, serving the City as disclosure counsel for this transaction, with the assistance of the financing team, including City staff; the Master Developer; Lennar Homes; the City’s municipal advisor; Stifel Nicolaus and Company, Incorporated (Underwriter), the underwriter of the 2024A Bonds; and the City’s special tax consultant.

The Preliminary Official Statement has been reviewed and approved for transmittal to the council by the City’s financing team. The distribution of the Preliminary Official Statement by the City is subject to federal securities laws, including the Securities Act of 1933 and the Securities Exchange Act of 1934.

These laws require the Preliminary Official Statement to include all facts that would be material to an investor in the 2024A Bonds. Material information is information that there is a substantial likelihood would have actual significance in the deliberations of the reasonable investor when deciding whether to buy or sell the bonds. If the council concludes that the Preliminary Official Statement includes all facts that would be material to an investor in the 2024A Bonds, it must adopt a resolution that authorizes staff to execute a certificate to the effect that the Preliminary Official Statement has been “deemed final.” The Securities and Exchange Commission (SEC) is an agency with regulatory authority over the City’s compliance with the federal securities laws, has issued guidance as to the duties of the City Council with respect to its approval of the Preliminary Official Statement. In its “Report of Investigation in the Matter of County of Orange, California as it Relates to the Conduct of the Members of the Board of Supervisors” (Release No. 36761 / January 24, 1996) (Release), the SEC stated that, if a member of the council has knowledge of any facts or circumstances that an investor would want to know about prior to investing in the 2024A Bonds, whether relating to their repayment, taxexempt status, undisclosed conflicts of interest with interested parties, or otherwise, they should endeavor to discover whether such facts are adequately disclosed in the Preliminary Official Statement. In the Release, the SEC stated that the steps that a member of the council could take include becoming familiar with the Preliminary Official Statement and questioning staff and consultants about the disclosure of such facts.

The key sections of the Preliminary Official Statement are summarized below:
• “THE 2024 BONDS:” This section summarizes the key terms of the 2024 Bonds, including payment dates and redemption provisions.
• “SECURITY FOR THE 2024 BONDS:” This section summarizes key security terms, including the City’s pledge of special tax revenues, its covenant to levy special taxes according to the RMA and its covenant to foreclose on parcels that are delinquent in the payment of special taxes. The 2024A Bonds are a limited obligation of the City, payable only from special taxes levied in Improvement Area No.1 and monies in the funds and accounts established under the Fiscal Agent Agreement described below. • “THE DISTRICT AND IMPROVEMENT AREA NO. 1:” This section summarizes certain features of Improvement Area No. 1, including the appraised value of taxable property, overlapping taxes, assessments and debt and anticipated debt service coverage provided by maximum special taxes that may be levied under the RMA.
• “PROPERTY OWNERSHIP AND DEVELOPMENT STATUS:” This section includes information provided by the Master Developer and Lennar Homes, and describes the proposed development in Improvement Area No. 1 and its current status. The City financing team was recently informed that Lennar Homes has transferred its property in Improvement Area No. 1 to a land bank entity. The Preliminary Official Statement will be updated to reflect ownership by the land bank entity and the circumstances under which the land bank entity will transfer parcels back to Lennar Homes.

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Agenda Item No: 15.AGENDA REPORTDATE:October 15, 2024 TO:Mayor and City CouncilFROM:David Gassaway, City ManagerSUBJECT:Resolution 2024253 of the City Council Authorizing the Issuance of Special Tax Bondsfor the City of Fairfield Community Facilities District No. 20231 (One Lake PlanningArea 5) with Respect to Improvement Area No. 1, and Approving Related Documentsand ActionsRECOMMENDED ACTIONAdopt resolution and approve related documents and actions.STATEMENT OF ISSUEThe City Council previously conducted proceedings under the MelloRoos Community Facilities Act of1982 (MelloRoos Act) to form (i) “City of Fairfield Community Facilities District No. 20231 (One LakePlanning Area 5)” (CFD 20231) and (ii) “Improvement Area No. 1 of the City of Fairfield CommunityFacilities District No. 20231 (One Lake Planning Area 5)” (Improvement Area No. 1).As a separate matter on tonight’s agenda, staff is recommending that the City Council continue changeproceedings for the CFD 20231 and Improvement Area No. 1 (Change Proceedings), including apublic hearing, a landowner election and introduction of an ordinance levying special taxes. If the counciladopts staff’s recommendation, the Change Proceedings would be complete with adoption of theordinance on November 19, 2024.As part of this matter, staff recommends that the council adopt the attached resolution in order toauthorize the sale of Special Tax Bonds, Series 2024A (2024A Bonds) with respect to ImprovementArea No. 1 in an amount not to exceed $36,500,000 and approve related documents and actions,including the Preliminary Official Statement, Continuing Disclosure Certificate, Fiscal Agent Agreement,and Bond Purchase Agreement.DISCUSSIONBackground Information About the One Lake Project and the Related DevelopmentAgreement.On August 16, 2011, the council entered into a Development Agreement (DevelopmentAgreement) with Canon Station LLC regarding approximately 1,570 acres within the Train StationSpecific Plan (TSSP) Area. Canon Station LLC was the master developer of a 358.5acre masterplanned community known as “One Lake” (One Lake Project), which is referred to as Planning Area 4and Planning Area 5 in the TSSP. The current master developer of the One Lake Project is One Lake Holding LLC (Master Developer). On September 3, 2024, the council adopted an ordinance approving the 5th Amendment to theDevelopment Agreement. The 5th Amendment increases the maximum combined tax rate, as definedin the 5th Amendment, from 1.65% to 1.75%.The Master Developer expects the One Lake Project to be developed in numerous phases that willultimately consist of 1,937 singlefamily and multifamily homes and a 190unit apartment complex, withapproximately 20,000 square feet of commercial/retail space. The Master Developer is not ahomebuilder and is developing the property through the sale of finished lots to merchant builders. Improvement Area No. 1 comprises the majority of Planning Area 5. Planning Area 4 is within aseparate community facilities district previously formed by the City and known as the City of FairfieldCommunity Facilities District No. 20191 (One Lake).Proposed 2024A Bonds.The City is authorized to levy special taxes and incur indebtedness for andon behalf of CFD 20231 to finance the costs of infrastructure associated with the One Lake Project.The City will use the proceeds of the 2024A Bonds to acquire authorized public improvements from theMaster Developer. Pursuant to the resolution, the effective interest rate on the 2024A Bonds cannotexceed 6%. Based on current market conditions, the 2024A Bonds are estimated to be issued in theamount of $36,500,000 and carry a true interest cost of approximately 5.37%. Based on the appraisal completed by BBG, Inc., the value of the property in Improvement Area No. 1has been determined to be not less than $110,300,000 as of August 28, 2024. Pursuant to a waiver bythe council in the Change Proceedings of a 4:1 valueto lien requirement in the City’s local goals andpolicies for community facilities districts, the value to lien ratio (which compares the market value of theproperty in Improvement Area No. 1 to the proposed principal amount of the 2024A Bonds to be issuedand bonds issued by overlapping community facilities districts and assessment districts) for the 2024ABonds will be at least 3:1. The financing is expected to close in November 2024. Debt service on the 2024A Bonds is payableonly from special taxes levied annually on taxable properties within Improvement Area No. 1 of CFD20231 in the manner set forth in the Amended and Restated Rate and Method of Apportionment ofSpecial Tax (RMA) approved by the council in the Change Proceedings. The 2024A Bonds will not haveany impact on the City’s General Fund.Proposed Resolution and Related Documents.In order to complete the financing, the council isbeing asked to approve each of the following:• Resolution.Resolution of the council authorizing the issuance of bonds for CFD 20231 with respect toImprovement Area No. 1, and approving related documents and actions.• Preliminary Official Statement.The Official Statement is the primary disclosure document for investorsin the 2024A Bonds. A Preliminary Official Statement will be circulated to potential investors prior to thepricing of the 2024A Bonds. After the 2024A Bonds have been priced, a Final Official Statement will becirculated to investors; the Final Official Statement should be identical to the Preliminary OfficialStatement except for the addition of pricing information (principal amount, interest rates, redemptionterms).The Preliminary Official Statement describes the special taxes to be levied in the Improvement AreaNo. 1 and the development plans and status for the property within Improvement Area No. 1, andinformation on the Master Developer and merchant builders for Improvement Area No. 1, currentlyLennar Homes. The Preliminary Official Statement will also include the appraisal of the taxable parcelsin Improvement Area No. 1. The Preliminary Official Statement is prepared by Jones Hall, serving the City as disclosure counsel forthis transaction, with the assistance of the financing team, including City staff; the Master Developer;Lennar Homes; the City’s municipal advisor; Stifel Nicolaus and Company, Incorporated (Underwriter),the underwriter of the 2024A Bonds; and the City’s special tax consultant. The Preliminary Official Statement has been reviewed and approved for transmittal to the council by theCity’s financing team. The distribution of the Preliminary Official Statement by the City is subject tofederal securities laws, including the Securities Act of 1933 and the Securities Exchange Act of 1934.These laws require the Preliminary Official Statement to include all facts that would be material to aninvestor in the 2024A Bonds. Material information is information that there is a substantial likelihoodwould have actual significance in the deliberations of the reasonable investor when deciding whether tobuy or sell the bonds. If the council concludes that the Preliminary Official Statement includes all factsthat would be material to an investor in the 2024A Bonds, it must adopt a resolution that authorizes staffto execute a certificate to the effect that the Preliminary Official Statement has been “deemed final.”The Securities and Exchange Commission (SEC) is an agency with regulatory authority over the City’scompliance with the federal securities laws, has issued guidance as to the duties of the City Councilwith respect to its approval of the Preliminary Official Statement. In its “Report of Investigation in theMatter of County of Orange, California as it Relates to the Conduct of the Members of the Board ofSupervisors” (Release No. 36761 / January 24, 1996) (Release), the SEC stated that, if a member ofthe council has knowledge of any facts or circumstances that an investor would want to know about priorto investing in the 2024A Bonds, whether relating to their repayment, taxexempt status, undisclosedconflicts of interest with interested parties, or otherwise, they should endeavor to discover whether suchfacts are adequately disclosed in the Preliminary Official Statement. In the Release, the SEC stated thatthe steps that a member of the council could take include becoming familiar with the Preliminary OfficialStatement and questioning staff and consultants about the disclosure of such facts.The key sections of the Preliminary Official Statement are summarized below:• “THE 2024 BONDS:” This section summarizes the key terms of the 2024 Bonds, including paymentdates and redemption provisions. • “SECURITY FOR THE 2024 BONDS:” This section summarizes key security terms, including theCity’s pledge of special tax revenues, its covenant to levy special taxes according to the RMA and itscovenant to foreclose on parcels that are delinquent in the payment of special taxes. The 2024A Bondsare a limited obligation of the City, payable only from special taxes levied in Improvement Area No.1and monies in the funds and accounts established under the Fiscal Agent Agreement described below.• “THE DISTRICT AND IMPROVEMENT AREA NO. 1:” This section summarizes certain features ofImprovement Area No. 1, including the appraised value of taxable property, overlapping taxes,assessments and debt and anticipated debt service coverage provided by maximum special taxes thatmay be levied under the RMA. • “PROPERTY OWNERSHIP AND DEVELOPMENT STATUS:” This section includes informationprovided by the Master Developer and Lennar Homes, and describes the proposed development inImprovement Area No. 1 and its current status. The City financing team was recently informed thatLennar Homes has transferred its property in Improvement Area No. 1 to a land bank entity. The Preliminary Official Statement will be updated to reflect ownership by the land bank entity and the circumstances under which the land bank entity will transfer parcels back to Lennar Homes. • “BOND OWNERS’ RISKS:” This section highlights the primary risks associated with the 2024A Bonds, including failure to complete the proposed development, natural disasters and failure of property owners to pay their special taxes.
• “LEGAL MATTERS – Tax Exemption:” This section describes the taxexempt nature of interest on the 2024 Bonds.

In addition to the Preliminary Official Statement, the council is being asked to approve the following documents:
• Continuing Disclosure Certificate.Under SEC Rule 15c212, the Underwriter may only purchase the 2024A Bonds if it has determined that the City is obligated to provide continuing disclosure, including annual updates of the financial and operating data included in the Official Statement and notices of certain specified events. The Master Developer and Lennar Homes each will also provide continuing disclosure on a semiannual basis until the property they each own in Improvement Area No. 1 is no longer responsible for 15% or more of the special taxes. • Fiscal Agent Agreement. This document governs the 2024A Bonds and the use of special taxes from Improvement Area No. 1 to pay debt service on the 2024A Bonds. The fiscal agent is The Bank of New York Mellon Trust Company, N.A. The special taxes will be levied on the regular County tax roll and collected by the County from each taxable parcel in Improvement Area No. 1. The County will remit these special taxes to the City. The City will remit them to the fiscal agent as provided for in the Fiscal Agent Agreement. The Fiscal Agent will use the revenues to (1) pay administrative costs of the CFD and (2) pay principal of and interest on the 2024A Bonds to the bond owners. • Bond Purchase Agreement.At the time the 2024A Bonds are sold, the City will enter into a Bond Purchase Agreement with the Underwriter, who will agree to underwrite the 2024A Bonds subject to satisfaction of the conditions described in the Bond Purchase Agreement. The resolution provides the Underwriter’s discount on the purchase of the 2024A Bonds shall not exceed 1.5% of the par amount of the 2024A Bonds.

FINANCIAL IMPACT
There is no General Fund or fiscal impact to the City. The 2024A Bonds will be payable only from special taxes levies in Improvement Area No. 1.

PUBLIC CONTACT/ADVISORY BODY RECOMMENDATION
N/A
ALTERNATIVE ACTION
The City may choose not to approve the attached resolution, in which case the 2024A Bonds would not be issued. However, pursuant to the Development Agreement, the City has agreed to cooperate with the Master Developer in forming CFD 20231 and issuing indebtedness for CFD 20231.

STAFF CONTACT
John Furtado, Finance Director
(707) 4287629
[email protected]
COORDINATED WITH
City Attorney's Office
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Agenda Item No: 15.AGENDA REPORTDATE:October 15, 2024 TO:Mayor and City CouncilFROM:David Gassaway, City ManagerSUBJECT:Resolution 2024253 of the City Council Authorizing the Issuance of Special Tax Bondsfor the City of Fairfield Community Facilities District No. 20231 (One Lake PlanningArea 5) with Respect to Improvement Area No. 1, and Approving Related Documentsand ActionsRECOMMENDED ACTIONAdopt resolution and approve related documents and actions.STATEMENT OF ISSUEThe City Council previously conducted proceedings under the MelloRoos Community Facilities Act of1982 (MelloRoos Act) to form (i) “City of Fairfield Community Facilities District No. 20231 (One LakePlanning Area 5)” (CFD 20231) and (ii) “Improvement Area No. 1 of the City of Fairfield CommunityFacilities District No. 20231 (One Lake Planning Area 5)” (Improvement Area No. 1).As a separate matter on tonight’s agenda, staff is recommending that the City Council continue changeproceedings for the CFD 20231 and Improvement Area No. 1 (Change Proceedings), including apublic hearing, a landowner election and introduction of an ordinance levying special taxes. If the counciladopts staff’s recommendation, the Change Proceedings would be complete with adoption of theordinance on November 19, 2024.As part of this matter, staff recommends that the council adopt the attached resolution in order toauthorize the sale of Special Tax Bonds, Series 2024A (2024A Bonds) with respect to ImprovementArea No. 1 in an amount not to exceed $36,500,000 and approve related documents and actions,including the Preliminary Official Statement, Continuing Disclosure Certificate, Fiscal Agent Agreement,and Bond Purchase Agreement.DISCUSSIONBackground Information About the One Lake Project and the Related DevelopmentAgreement.On August 16, 2011, the council entered into a Development Agreement (DevelopmentAgreement) with Canon Station LLC regarding approximately 1,570 acres within the Train StationSpecific Plan (TSSP) Area. Canon Station LLC was the master developer of a 358.5acre masterplanned community known as “One Lake” (One Lake Project), which is referred to as Planning Area 4and Planning Area 5 in the TSSP. The current master developer of the One Lake Project is One Lake Holding LLC (Master Developer). On September 3, 2024, the council adopted an ordinance approving the 5th Amendment to theDevelopment Agreement. The 5th Amendment increases the maximum combined tax rate, as definedin the 5th Amendment, from 1.65% to 1.75%.The Master Developer expects the One Lake Project to be developed in numerous phases that willultimately consist of 1,937 singlefamily and multifamily homes and a 190unit apartment complex, withapproximately 20,000 square feet of commercial/retail space. The Master Developer is not ahomebuilder and is developing the property through the sale of finished lots to merchant builders. Improvement Area No. 1 comprises the majority of Planning Area 5. Planning Area 4 is within aseparate community facilities district previously formed by the City and known as the City of FairfieldCommunity Facilities District No. 20191 (One Lake).Proposed 2024A Bonds.The City is authorized to levy special taxes and incur indebtedness for andon behalf of CFD 20231 to finance the costs of infrastructure associated with the One Lake Project.The City will use the proceeds of the 2024A Bonds to acquire authorized public improvements from theMaster Developer. Pursuant to the resolution, the effective interest rate on the 2024A Bonds cannotexceed 6%. Based on current market conditions, the 2024A Bonds are estimated to be issued in theamount of $36,500,000 and carry a true interest cost of approximately 5.37%. Based on the appraisal completed by BBG, Inc., the value of the property in Improvement Area No. 1has been determined to be not less than $110,300,000 as of August 28, 2024. Pursuant to a waiver bythe council in the Change Proceedings of a 4:1 valueto lien requirement in the City’s local goals andpolicies for community facilities districts, the value to lien ratio (which compares the market value of theproperty in Improvement Area No. 1 to the proposed principal amount of the 2024A Bonds to be issuedand bonds issued by overlapping community facilities districts and assessment districts) for the 2024ABonds will be at least 3:1. The financing is expected to close in November 2024. Debt service on the 2024A Bonds is payableonly from special taxes levied annually on taxable properties within Improvement Area No. 1 of CFD20231 in the manner set forth in the Amended and Restated Rate and Method of Apportionment ofSpecial Tax (RMA) approved by the council in the Change Proceedings. The 2024A Bonds will not haveany impact on the City’s General Fund.Proposed Resolution and Related Documents.In order to complete the financing, the council isbeing asked to approve each of the following:• Resolution.Resolution of the council authorizing the issuance of bonds for CFD 20231 with respect toImprovement Area No. 1, and approving related documents and actions.• Preliminary Official Statement.The Official Statement is the primary disclosure document for investorsin the 2024A Bonds. A Preliminary Official Statement will be circulated to potential investors prior to thepricing of the 2024A Bonds. After the 2024A Bonds have been priced, a Final Official Statement will becirculated to investors; the Final Official Statement should be identical to the Preliminary OfficialStatement except for the addition of pricing information (principal amount, interest rates, redemptionterms).The Preliminary Official Statement describes the special taxes to be levied in the Improvement AreaNo. 1 and the development plans and status for the property within Improvement Area No. 1, andinformation on the Master Developer and merchant builders for Improvement Area No. 1, currentlyLennar Homes. The Preliminary Official Statement will also include the appraisal of the taxable parcelsin Improvement Area No. 1. The Preliminary Official Statement is prepared by Jones Hall, serving the City as disclosure counsel forthis transaction, with the assistance of the financing team, including City staff; the Master Developer;Lennar Homes; the City’s municipal advisor; Stifel Nicolaus and Company, Incorporated (Underwriter),the underwriter of the 2024A Bonds; and the City’s special tax consultant. The Preliminary Official Statement has been reviewed and approved for transmittal to the council by theCity’s financing team. The distribution of the Preliminary Official Statement by the City is subject tofederal securities laws, including the Securities Act of 1933 and the Securities Exchange Act of 1934.These laws require the Preliminary Official Statement to include all facts that would be material to aninvestor in the 2024A Bonds. Material information is information that there is a substantial likelihoodwould have actual significance in the deliberations of the reasonable investor when deciding whether tobuy or sell the bonds. If the council concludes that the Preliminary Official Statement includes all factsthat would be material to an investor in the 2024A Bonds, it must adopt a resolution that authorizes staffto execute a certificate to the effect that the Preliminary Official Statement has been “deemed final.”The Securities and Exchange Commission (SEC) is an agency with regulatory authority over the City’scompliance with the federal securities laws, has issued guidance as to the duties of the City Councilwith respect to its approval of the Preliminary Official Statement. In its “Report of Investigation in theMatter of County of Orange, California as it Relates to the Conduct of the Members of the Board ofSupervisors” (Release No. 36761 / January 24, 1996) (Release), the SEC stated that, if a member ofthe council has knowledge of any facts or circumstances that an investor would want to know about priorto investing in the 2024A Bonds, whether relating to their repayment, taxexempt status, undisclosedconflicts of interest with interested parties, or otherwise, they should endeavor to discover whether suchfacts are adequately disclosed in the Preliminary Official Statement. In the Release, the SEC stated thatthe steps that a member of the council could take include becoming familiar with the Preliminary OfficialStatement and questioning staff and consultants about the disclosure of such facts.The key sections of the Preliminary Official Statement are summarized below:• “THE 2024 BONDS:” This section summarizes the key terms of the 2024 Bonds, including paymentdates and redemption provisions. • “SECURITY FOR THE 2024 BONDS:” This section summarizes key security terms, including theCity’s pledge of special tax revenues, its covenant to levy special taxes according to the RMA and itscovenant to foreclose on parcels that are delinquent in the payment of special taxes. The 2024A Bondsare a limited obligation of the City, payable only from special taxes levied in Improvement Area No.1and monies in the funds and accounts established under the Fiscal Agent Agreement described below.• “THE DISTRICT AND IMPROVEMENT AREA NO. 1:” This section summarizes certain features ofImprovement Area No. 1, including the appraised value of taxable property, overlapping taxes,assessments and debt and anticipated debt service coverage provided by maximum special taxes thatmay be levied under the RMA. • “PROPERTY OWNERSHIP AND DEVELOPMENT STATUS:” This section includes informationprovided by the Master Developer and Lennar Homes, and describes the proposed development inImprovement Area No. 1 and its current status. The City financing team was recently informed thatLennar Homes has transferred its property in Improvement Area No. 1 to a land bank entity. ThePreliminary Official Statement will be updated to reflect ownership by the land bank entity and thecircumstances under which the land bank entity will transfer parcels back to Lennar Homes.• “BOND OWNERS’ RISKS:” This section highlights the primary risks associated with the 2024ABonds, including failure to complete the proposed development, natural disasters and failure of propertyowners to pay their special taxes.• “LEGAL MATTERS – Tax Exemption:” This section describes the taxexempt nature of interest on the2024 Bonds.In addition to the Preliminary Official Statement, the council is being asked to approve the followingdocuments:• Continuing Disclosure Certificate.Under SEC Rule 15c212, the Underwriter may only purchase the2024A Bonds if it has determined that the City is obligated to provide continuing disclosure, includingannual updates of the financial and operating data included in the Official Statement and notices ofcertain specified events. The Master Developer and Lennar Homes each will also provide continuingdisclosure on a semiannual basis until the property they each own in Improvement Area No. 1 is nolonger responsible for 15% or more of the special taxes. • Fiscal Agent Agreement. This document governs the 2024A Bonds and the use of special taxes fromImprovement Area No. 1 to pay debt service on the 2024A Bonds. The fiscal agent is The Bank of NewYork Mellon Trust Company, N.A. The special taxes will be levied on the regular County tax roll andcollected by the County from each taxable parcel in Improvement Area No. 1. The County will remitthese special taxes to the City. The City will remit them to the fiscal agent as provided for in the FiscalAgent Agreement. The Fiscal Agent will use the revenues to (1) pay administrative costs of the CFDand (2) pay principal of and interest on the 2024A Bonds to the bond owners.• Bond Purchase Agreement.At the time the 2024A Bonds are sold, the City will enter into a BondPurchase Agreement with the Underwriter, who will agree to underwrite the 2024A Bonds subject tosatisfaction of the conditions described in the Bond Purchase Agreement. The resolution provides theUnderwriter’s discount on the purchase of the 2024A Bonds shall not exceed 1.5% of the par amount ofthe 2024A Bonds.FINANCIAL IMPACTThere is no General Fund or fiscal impact to the City. The 2024A Bonds will be payable only fromspecial taxes levies in Improvement Area No. 1.PUBLIC CONTACT/ADVISORY BODY RECOMMENDATIONN/AALTERNATIVE ACTIONThe City may choose not to approve the attached resolution, in which case the 2024A Bonds would notbe issued. However, pursuant to the Development Agreement, the City has agreed to cooperate withthe Master Developer in forming CFD 20231 and issuing indebtedness for CFD 20231.STAFF CONTACTJohn Furtado, Finance Director(707) 428[email protected] WITH City Attorney's Office
ATTACHMENTS:

Description
Attachment 1: Resolution
Attachment 2: Exhibit A
Attachment 3: Preliminary Official Statement
Attachment 4: Bond Purchase Agreement
Attachment 5: Fiscal Agent Agreement
REVIEWERS:

Reviewer Action Date
Beavers, Esther Approved 10/8/2024 8:09 AM
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CITY OF FAIRFIELD

RESOLUTION NO. 2024-253

RESOLUTION OF THE CITY COUNCIL AUTHORIZING THE ISSUANCE OF SPECIAL TAX BONDS FOR THE CITY OF FAIRFIELD COMMUNITY FACILITIES DISTRICT NO. 2023-1 (ONE LAKE PLANNING AREA 5) WITH RESPECT TO IMPROVEMENT AREA NO. 1, AND APPROVING RELATED

DOCUMENTS AND ACTIONS

Improvement Area No. 1 of the
City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5)

WHEREAS, the City Council has conducted proceedings under and pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, Chapter 2.5 of Part 1 of Division 2 of Title 5 (commencing with Section 53311) of the California Government Code (Act), to form (i) “City o f Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5)” (CFD) and (ii) “Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023 -1 (One Lake Planning Area 5)” (“Improvement Area No. 1”), to authorize t he levy of special taxes upon the land within Improvement Area No. 1, and to issue bonds and other debt (as defined in the Act) secured by said special taxes for the purpose of financing certain public improvements (Facilities), all as described in those proceedings; and

WHEREAS, the council established the CFD and Improvement Area No. 1 and approved a rate and method of apportionment of special tax for Improvement Area No. 1 pursuant to Resolution No. 2023-31, adopted on February 21, 2023, (Resolution of Formation) and the council determined the necessity to incur bonded indebtedness for the CFD with respect to Improvement Area No. 1 in the principal amount of $90,000,000 (Improvement Area No. 1 Bonded Indebtedness Limit) pursuant to Resolution No. 2023-32, adopted on February 21, 2023 (Resolution Determining Necessity); and

WHEREAS, on October 15, 2024, the qualified electors of Improvement Area No. 1 approved an Amended and Restated Rate and Method of Apportionment of Special Tax for Impr ovement Area No. 1 and an increase in the Improvement Area No. 1 Bonded Indebtedness Limit to $100,000,000, and the council approved the Amended and Restated Rate and Method of Apportionment of Special Tax for Improvement Area No. 1 and the increased Improvement Area No. 1 Bonded Indebtedness Limit pursuant to Resolution No. 2024-256, adopted on October 15, 2024 (Resolution of Change); and

WHEREAS, on October 18, 2016, by Resolution No. 2016-237, the council adopted local goals and policies for community facilities districts (Goals and Policies); and

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WHEREAS, pursuant to Resolution No. 2023-35, adopted on February 21, 2023 (Original Resolution of Issuance), this council authorized the issuance of up to $90,000,000 of special tax bonds on behalf of the CFD with respect to Improvement Area No. 1, and directed staff to prepare documentation for such special tax bonds and return to this council for approval of such documentation; and

WHEREAS, the council now wishes to supplement the Original Resolution of Issuance to provide for the issuance of special tax bonds for the CFD with respect to Improvement Area No. 1 to finance a portion of the Facilities and related costs and expenses, and there have been submitted to the council certain documents described below providing for the issuance of the special tax bonds for the CFD with respect to Improvement Area No. 1 and the use of the proceeds of those bonds, and the City Council, with the aid of its staff, has reviewed the documents and found them to be in proper order; and

WHEREAS, there has also been submitted to the council a form of Preliminary Official Statement in connection with the marketing of the Bonds (as defined below), and the council, with the aid of its staff, wishes to approve the distribution of the Preliminary Official Statement; and

WHEREAS, in accordance with Government Code Section 5852.1, the council has obtained and wishes to disclose the information set forth in Appendix A hereto; and

WHEREAS, all conditions, things, and acts required to exist, to have happened, and to have been performed precedent to and in the issuance of the special tax bonds and the levy of the special taxes as contemplated by this Resolution and the documents referred to herein exist, have happened and have been performed in due time, form and manner as required by the laws of the State of California, including the Act.

NOW, THEREFORE, THE COUNCIL OF THE CITY OF FAIRFIELD HEREBY RESOLVES:

Section 1. Bonds Authorized. Pursuant to the Act, the Original Resolution of Issuance, this Resolution and the Fiscal Agent Agreement (as defined in Section 4 hereof), special tax bonds designated the “Improvement Area No.1 of the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5) Special Tax Bonds, Series 2024A” (Bonds) in an aggregate principal amount not to exceed the amount specified in Section 7 are hereby authorized to be issued. The Bonds shall be executed in the form, mature, be payable in the priorities , and bear interest at the rates as provided in the Fiscal Agent Agreement and in accordance with this Resolution. The Fiscal Agent, an Authorized Officer (as defined in Section 3 of this Resolution), and other responsible officers of the City are hereby authorized and directed to take such actions as are required to cause the delivery of the Bonds upon receipt of the purchase price thereof.

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Section 2. Compliance with the Goals and Policies, the Original Resolution of Issuance, and the Act. The council hereby finds that the issuance of the Bonds is in compliance with the Act, the Original Resolution of Issuance, and applicable provisions of the Goals and Policies, except as set forth below. More specifically, the City Council hereby makes the following determinations:

(a) The appraisal described in the Preliminary Official Statement has been prepared consistent with the Goals and Policies.

(b) The Amended and Restated Rate and Method of Apportionment of Special Tax for Improvement Area No. 1 is in compliance with the Goals and Policies.

(c) Section 53345.8 of the Act requires, with certain exceptions, that the value of the real property subject to special taxes levied in Improvement Area No. 1 must be at least three times the principal amount of the Bonds and the principal amount of all other bonds that will be outstanding following issuance of the Bonds that are secured by a special tax levied pursuant to the Act on property within Improvement Area No. 1 or a special assessment levied on property within Improvement Area No. 1 (this requirement is referred to as the “value to lien ratio”). In addition, the Goals and Policies require the value-to-lien ratio to be at least four to one. The appraisal described in the Preliminary Official Statement concludes that the taxable property in Improvement Area No. 1 has a market value of $110,300,000 (subject to the various assumptions and conditions set forth in the appraisal), which is at least three times (i) the maximum initial principal amount of the Bonds authorized by this Resolution and (ii) the outstanding princip al amount of all other outstanding bonds that are secured by a special tax or special assessment levied on property within Improvement Area No. 1. The provision in the Goals and Policies requiring a four to one value to lien ratio was waived by the council in the Resolution of Change.

(d) The provision requiring property owners to provide continuing disclosure as long as they own property that is responsible for at least 10% of the special taxes in Improvement Area No. 1 is hereby waived so that the thresh old can be established for the Bonds at a level acceptable to Stifel, Nicolaus & Company, Incorporated, the underwriter of the Bonds (Underwriter).

Section 3. Authorities Granted. To the extent permitted by law, the mayor, the city manager, the finance director, or such other official of the City as may be designated by the mayor, the city manager, or the finance director (each, an “Authorized Officer”) is hereby authorized and directed to execute and deliver the documents approved herein in substantiall y the form on file with the city clerk, together with such additions or changes as are approved by such authorized officer upon consultation with the city attorney and the City’s bond counsel, including such additions or changes as are necessary or advisable to permit the timely issuance, sale and delivery Packet Page 208 of 530Attachment 1 Page 3 of 6

RES. NO. 2024-253

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of the Bonds. The approval of such additions or changes shall be conclusively evidenced by the execution and delivery by an authorized officer of the documents herein specified.

Section 4. Fiscal Agent Agreement. The council hereby approves the form of the Fiscal Agent Agreement (Fiscal Agent Agreement) by and between the City and The Bank of New York Mellon Trust Company, N.A., as fiscal agent (Fiscal Agent) with respect to the Bonds, in substantially the form on file with the city clerk. The date, manner of payment, interest rate or rates, interest payment dates, denominations, form, registration privileges, manner of execution, place of payment, terms of redemption, and other terms of the Bonds shall be as provided in the Fiscal Agent Agreement as finally executed and delivered. The terms and provisions of the Fiscal Agent Agreement, as executed, are incorporated herein by this reference as if fully set forth herein. An authorized officer is hereby authorized and directed to execute the Fiscal Agent Agreement on behalf of the City, with such changes, additions, or deletions as may be approved by the authorized officer, and the city clerk is hereby authorized and directed to attest thereto, subject to the terms of Section 7 hereof.

Section 5. Official Statement. The council hereby approves the preliminary Official Statement prepared in connection with the Bonds in substantially the form on file with the city clerk, together with any changes therein or additions thereto deemed advisable by an authorized officer. The council hereby approves and authorizes the distribution by the Underwriter of the preliminary Official Statement to prospective purchasers of the Bonds and authorizes and directs an authorized officer on behalf of the City to deem the preliminary Official Statement “final” pursuant to Rule 15c2-12 under the Securities Exchange Act of 1934 (Rule) prior to its distribution to prospective purchasers of the Bonds. The execution of the final Official Statement, which shall include Bond pricing information, such other changes and additions thereto deemed advisable by an authorized officer, and such information permitted to be excluded from the preliminary Official Statement pursuant to the Rule, shall be conclusive evidence of the approval of the Official Statement by the City.

Section 6. Continuing Disclosure. The council hereby approves the form of the Continuing Disclosure Certificate with respect to the Bonds in substantially the form thereof attached to the Official Statement on file with the city clerk. An authorized officer is hereby authorized and directed to complete and execute the Continuing Disclosure Certificate on behalf of the City (for and on behalf of the CFD) with such changes, additions, or deletions as may be approved by the authorized officer in consultation with the City’s disclosure counsel.

Section 7. Sale of the Bonds; Bond Purchase Agreement . The Bond Purchase Agreement, between the City, for and on behalf of the CFD with respect to Improvement Area No.1, and the Underwriter, in substantially the form on file with the city clerk and made a part hereof as though set forth in full herein, is hereby approved by the council. An authorized officer is hereby authorized and directed to execute and deliver the Bond Purchase Agreement in such form, Packet Page 209 of 530Attachment 1 Page 4 of 6

RES. NO. 2024-253

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together with such changes, insertions, and omissions that are approved by an authorized officer and that are in accordance with the provisions of this Resolution, such execution to be conclusive evidence of such approval; subject to the requirement that the principal amount of the Bonds may not exceed $36,500,000; the true interest cost of the Bonds shall not exceed 6%; and the Underwriter’s discount on the purchase of the Bonds shall not exceed 1.5% of the par amount of the Bonds.

The council hereby approves the negotiated sale of the Bonds to the Underwriter pursuant to such Bond Purchase Agreement; the negotiated sale may be on a forward basis, as determined by an authorized officer.

The council hereby finds that the sale of the Bonds to the Underwriter at a negotiated sale pursuant to the Bond Purchase Agreement will result in a lower overall cost than it would be achieved by selling the Bonds utilizing competitive bidding.

Section 8. Bond Delivery. The Bonds shall be prepared, executed, and delivered to the fiscal agent for authentication, all in accordance with the terms of the Fiscal Agent Agreement and the Purchase Contract. The fiscal agent, an Authorized Officer and other responsible officers of the City are hereby authorized and directed to take such actions as are required to cause the delivery of the Bonds upon receipt of the purchase price thereof.

Section 9. Actions Authorized. All actions heretofore taken by the officers and agents of the City (including, but not limited to, the authorized officers) with respect to the establishment of the CFD and Improvement Area No. 1 and the sale and issuance of the Bonds are hereby approved, confirmed and ratified, and the appropriate officers of the City are hereby authorized and directed to do any and all things and take any and all actions and execute any and all certificates, agreements and other documents, which they, or any of them, may deem necessary or advisable in order to consummate the lawful issuance and delivery of the Bonds in accordance with this Resolution, including but not limited to any actions required in connection with the issuance of ratings or a municipal bond insurance policy with respect to the Bonds and any certificate, agreement, and other document described in the documents herein approved. All actions to be taken by an authorized officer, as defined herein, may be taken by such authorized officer or any designee with the same force and effect as if taken by the authorized officer.

Section 10. Effectiveness. This Resolution shall take effect from and after its adoption. The provisions of any previous resolutions in any way inconsistent with the provisions hereof in and for the issuance of the Bonds as herein described are hereby repealed.

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RES. NO. 2024-253

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PASSED AND ADOPTED this 15th day of October 2024, by the following vote:

_________________________________________________
MAYOR
ATTEST:
___________________________

CITY CLERK

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Appendix A

Government Code Section 5852.1 Disclosure

The good faith estimates set forth herein are provided with respect to the Bonds in accordance with California Government Code Section 5852.1. Such good faith estimates have been provided to the City by PFM Financial Advisors LLC, the City’s Municipal Advisor, in consultation with Stifel, Nicolaus & Company, Incorporated, Underwriter of the Bonds.

Principal Amount. The Municipal Advisor has informed the City that, based on the CFD financing plan and current market conditions, its good faith estimate of the aggregate principal amount of the Bonds to be sold is $36,500,000 (the “Estimated Principal Amount”).

True Interest Cost of the Bonds. The Municipal Advisor has informed the City that, assuming that the Estimated Principal Amount of the 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 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 Bonds, is 5.37%.

Finance Charge of the Bonds. The Municipal Advisor has informed the City that, assuming that the Estimated Principal Amount of the 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 Bonds, which means the sum of all fees and charges paid to third parties (or costs associated with the Bonds), is $1,064,900.00. Such fees and charges include fees for bond and disclosure counsel, municipal advisor, appraiser, market absorption consultant, special tax consultant, fiscal agent, city attorney and staff time related to bond issu ance, set-aside for Fiscal Year 2024-25 CFD administrative expenses, printing, and underwriting.

Amount of Proceeds to be Received. The Municipal Advisor has informed the City that, assuming that the Estimated Principal Amount of the 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 on behalf of the CFD and Improvement Area No.1 for sale of the Bonds, less the finance charge of the Bonds, as estimated above, and any reserves or capitalized interest paid or funded with proceeds of the Bonds, is $31,500,413.63.

Total Payment Amount. The Municipal Advisor has informed the City that, assuming that the Estimated Principal Amount of the 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 that the Improvement Area No.1 property owners will make to pay debt service on the Bonds, plus the finance charge for the Bonds, as described above, not paid with the proceeds of the Bonds (including the Bond proceeds deposited into a debt service reserve fund), calculated to the final maturity of the Bonds, is $75,776,137.71.

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The foregoing estimates constitute good faith estimates only. The actual principal amount of the 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 Bonds being different than the date assumed for purposes of such estimates, (b) the actual principal amount of Bonds sold being different from the Estimated Principal Amount, (c) the actual amortization of the 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 Bonds being different than those estimated for purposes of such estimates, (e) other market conditions, or (f) alterations in the CFD financing plan, delays in the financing, or a combination of such factors. The actual date of sale of the Bonds and the actual principal amount of Bonds sold will be determined by the City based on the timing of the need for proceeds of the Bonds and other factors. The actual interest rates borne by the Bonds will depend on market interest rates at the time of sale thereof. The actual amortization of the 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.

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This Preliminary Official Statement and the information contained herein are subject to completion or amendment. These securities may not be sold nor may offers to buy be accepted prior to the time the Official Statement is delivered in final form. Under no circumstances shall this Preliminary Official Statement constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of these securities in any jurisdiction in which such offer solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction. 16001-152 Jones Hall 9/15/2024 9/27/2024
10/01/2024

PRELIMINARY OFFICIAL STATEMENT DATED ____________, 2024

NEW ISSUE—BOOK-ENTRY ONLY NOT RATED
In the opinion of Jones Hall, A Professional Law Corporation, San Francisco, California, Bond Counsel, subject, however to certain qualifications described herein, under existing law, the interest on the 2024 Bonds is excluded from gross income for federal income tax purposes, and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals; however, such interest on the 2024 Bonds may be taken into account for the purpose of computing the alternative minimum tax imposed on certain corporations. In the further opinion of Bond Counsel, such interest is exempt from California personal income taxes. See “LEGAL MATTERS – Tax Exemption.”
$____________*
IMPROVEMENT AREA NO. 1 OF THE

CITY OF FAIRFIELD
COMMUNITY FACILITIES DISTRICT NO. 2023-1
(ONE LAKE PLANNING AREA 5)
SPECIAL TAX BONDS, SERIES 2024A
Dated: Date of Delivery Due: September 1, as shown on inside cover Authority for Issuance. The bonds captioned above (the “2024 Bonds”) are being issued by the City of Fairfield (the “City”) for and on behalf of the “City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5)” (the “District”) with respect to its “Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5)” (“Improvement Area No. 1”), pursuant to the Mello-Roos Community Facilities Act of 1982, as amended (the “Act”), the Resolution of Issuance and a Fiscal Agent Agreement dated as of November 1, 2024 (the “Fiscal Agent Agreement”), by and between the City, for and on behalf of the District, and The Bank of New York Mellon Trust Company, N.A., as fiscal agent (the “Fiscal Agent”).

Use of Proceeds. The 2024 Bonds are being issued to (i) finance the acquisition and construction of certain facilities and improvements to be owned and operated by the City, (ii) fund a debt service reserve fund, (iii) pay capitalized interest on the 2024 Bonds through September 1, 2025, and (iv) pay the costs of issuing the 2024 Bonds.

Security and Sources of Payment. The 2024 Bonds are payable from proceeds of Special Tax Revenues levied on property within Improvement Area No. 1 according to the rate and method of apportionment of special tax approved by the City Council and the eligible landowner voters in Improvement Area No. 1, as amended. The 2024 Bonds are secured by a first pledge of all of the Special Tax Revenues and the moneys on deposit in certain funds held by the Fiscal Agent under the Fiscal Agent Agreement, on a parity with additional Parity Bonds that may be issued in the future, subject to the conditions set forth in the Fiscal Agent Agreement. See “SECURITY FOR THE 2024 BONDS.”
Bond Terms; Redemption. Interest on the 2024 Bonds is payable on March 1, 2025, and semiannually thereafter on each March 1 and September 1. The 2024 Bonds will be issued in integral multiples of $5,000. The 2024 Bonds, when delivered, will be initially registered in the name of Cede & Co., as nominee of The Depository Trust Company (“DTC”), New York, New York. DTC will act as securities depository for the 2024 Bonds. The 2024 Bonds are subject to optional redemption, mandatory sinking fund redemption and mandatory redemption from prepaid Facilities Special Taxes. See “THE 2024 BONDS – Redemption.” The 2024 Bonds, the interest thereon, and any premiums payable on the redemption of any of the 2024 Bonds, are not an indebtedness of the City (except to the limited extent described in this Official Statement), the State of California (the “State”) or any of its political subdivisions, and neither the City (except to the limited extent described in this Official Statement), the State nor any of its political subdivisions is liable on the 2024 Bonds. Neither the faith and credit nor the taxing power of the City (except to the limited extent described in this Official Statement) or the State or any political subdivision thereof is pledged to the payment of the 2024 Bonds or interest thereon. Other than the Special Tax Revenues, no taxes are pledged to the payment of the 2024 Bonds. The 2024 Bonds are not a general obligation of the City, but are limited obligations of the City payable solely from the Special Tax Revenues as more fully described in this Official Statement.

MATURITY SCHEDULE
(see inside cover)
This cover page contains certain information for quick reference only. It is not a summary of the issue. Potential investors must read the entire Official Statement to obtain information essential to the making of an informed investment decision. Investment in the 2024 Bonds involves risks which may not be appropriate for some investors. See “BOND OWNERS' RISKS” for a discussion of special risk factors that should be considered in evaluating the investment quality of the 2024 Bonds.

The 2024 Bonds are offered when, as and if issued and accepted by the Underwriter, subject to approval as to their legality by Jones Hall, A Professional Law Corporation, San Francisco, California, Bond Counsel, and subject to certain other conditions.

Jones Hall, A Professional Law Corporation, is also serving as disclosure counsel to the City. Certain matters will be passed upon for the City by Richards, Watson and Gershon, San Francisco, California, acting as the City Attorney. Stradling Yocca Carlson & Rauth, a Professional Corporation, Newport Beach, California, is serving as counsel to the Underwriter, and Holland & Knight LLP, San Francisco, California, is serving as counsel to One Lake Holding LLC, the Master Developer. It is anticipated that the 2024 Bonds, in book-entry form, will be available for delivery through the facilities of DTC on or about ____________, 2024.

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The date of this Official Statement is: ___________, 2024. ¨
* Preliminary; subject to change.

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MATURITY SCHEDULE

$_______
IMPROVEMENT AREA NO. 1 OF THE

CITY OF FAIRFIELD
COMMUNITY FACILITIES DISTRICT NO. 2023-1
(ONE LAKE PLANNING AREA 5)
SPECIAL TAX BONDS, SERIES 2024A

$_________ Serial Bonds

Maturity Date
(September 1)
Principal
Amount
Interest
Rate Yield Price
CUSIP†
(Base ______)

$______ ___% Term Bond due September 1, 20__, Yield: ____%, Price: ____ CUSIP† No. _____

C Priced to first optional redemption date of __________________ at _____. † CUSIP Global Services (CGS) is managed on behalf of American Bankers Association by FactSet Research Systems Inc. Copyright(C) 2024 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(C) numbers are provided for convenience of reference only.

Neither the City nor the Underwriter or their agents or counsel assume responsibility for the accuracy of such numbers. * Preliminary; subject to change.

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CITY OF FAIRFIELD

CITY COUNCIL
Catherine Moy, Mayor
Pam Bertani, Vice Mayor Councilmember
K. Patrice Williams, Councilmember
Rick Vaccaro, Councilmember
Doug Carr, Councilmember
Doriss Panduro, Councilmember
Scott Tonnesen, Councilmember

CITY EXECUTIVE STAFF
David Gassaway, City Manager
John Furtado, Director of Finance
Savita Chaudhary, Interim Public Works Director
David Zellers, Director of Community and Economic Development

CITY TREASURER
Arvinda Krishnan

CITY CLERK
Karen L. Rees

CITY ATTORNEY
Richards, Watson & Gershon
San Francisco, California

___________________________________

PROFESSIONAL SERVICES

BOND AND DISCLOSURE COUNSEL
Jones Hall, A Professional Law Corporation
San Francisco, California

MUNICIPAL ADVISOR
PFM Financial Advisors LLC
San Francisco, California

SPECIAL TAX CONSULTANT
Goodwin Consulting Group, Inc.

Sacramento, California

APPRAISER
BBG, Inc.

Sacramento, California

FISCAL AGENT
The Bank of New York Mellon Trust Company, N.A.

San Francisco, California
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GENERAL INFORMATION ABOUT THIS OFFICIAL STATEMENT

No Offering May Be Made Except by this Official Statement. No dealer, broker, salesperson or other person has been authorized to give any information or to make any representations with respect to the 2024 Bonds other than as contained in this Official Statement, and if given or made, such other information or representation must not be relied upon as having been authorized.

No Unlawful Offers or Solicitations. This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy in any state in which such offer or solicitation is not authorized or in which the person making such offer or solicitation is not qualified to do so or to any person to whom it is unlawful to make such offer or solicitation.

Effective Date. This Official Statement speaks only as of its date, and the information and expressions of opinion contained in this Official Statement are subject to change without notice. Neither the delivery of this Official Statement nor any sale of the 2024 Bonds will, under any circumstances, create any implication that there has been no change in the affairs of the City, the District, any other parties described in this Official Statement, or in the condition of property within Improvement Area No. 1 of the District since the date of this Official Statement.

Use of this Official Statement. This Official Statement is submitted in connection with the sale of the 2024 Bonds referred to herein and may not be reproduced or used, in whole or in part, for any other purpose. This Official Statement is not a contract with the purchasers of the 2024 Bonds.

Preparation of this Official Statement. The information contained in this Official Statement has been obtained from sources that are believed to be reliable, but this information is not guaranteed as to accuracy or completeness. 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 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.

Document References and Summaries. All references to and summaries of the Fiscal Agent Agreement or other documents contained in this Official Statement are subject to the provisions of those documents and do not purport to be complete statements of those documents.

Stabilization of and Changes to Offering Prices. The Underwriter may overallot or take other steps that stabilize or maintain the market prices of the 2024 Bonds at levels above those that might otherwise prevail in the open market. If commenced, the Underwriter may discontinue such market stabilization at any time. The Underwriter may offer and sell the 2024 Bonds to certain securities dealers, dealer banks and banks acting as agent at prices lower than the public offering prices stated on the inside cover page of this Official Statement, and those public offering prices may be changed from time to time by the Underwriter.

Bonds are Exempt from Securities Laws Registration. The issuance and sale of the 2024 Bonds have not been registered under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, in reliance upon exemptions for the issuance and sale of municipal securities provided under Section 3(a)(2) of the Securities Act of 1933 and Section 3(a)(12) of the Securities Exchange Act of 1934.

Estimates and Projections. 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,” “budget” or other similar words.

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 those forward-looking statements if or when its expectations, or events, conditions or circumstances on which such statements are based occur.

The City maintains an Internet website, but the information on the website is not incorporated in this Official Statement.

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TABLE OF CONTENTS

Page Page
INTRODUCTION ............................................... 1 FINANCING PLAN ............................................. 6 Facilities Financing Plan ................................ 6 Estimated Sources and Uses of Funds ......... 6
THE 2024 BONDS ............................................. 7 Authority for Issuance .................................... 7 General Bond Terms ..................................... 7 Redemption ................................................... 8 Issuance of Future Parity Bonds ................. 10
Registration, Transfer and Exchange .......... 13
DEBT SERVICE SCHEDULE .......................... 14
SECURITY FOR THE 2024 BONDS ............... 15
General ........................................................ 15 Limited Obligation ........................................ 16 Facilities Special Taxes ............................... 16 Amended Rate and Method ......................... 17
Covenant to Foreclose ................................. 24 Special Tax Fund ......................................... 26 Bond Fund ................................................... 28 2024 Reserve Fund ..................................... 29 Investment of Moneys in Funds ................... 31

THE DISTRICT AND IMPROVEMENT AREA
NO. 1 ............................................................ 32 Formation and Background ......................... 32
Description and Location ............................. 33 Authorized Facilities ..................................... 33 Special Tax Revenues and Projected Debt
Service Coverage .................................... 35 Assessed Values ......................................... 36 Appraised Values ......................................... 36 Appraised Value-to-Debt Ratios .................. 37
Direct and Overlapping Governmental
Obligations ............................................... 40 Estimated Tax Burden on Single-Family
Homes ..................................................... 41 No History of Facilities Special Tax
Collection and Delinquencies .................. 42
Potential Consequences of Facilities
Special Tax Delinquencies ...................... 42

PROPERTY OWNERSHIP AND
DEVELOPMENT STATUS .......................... 43
The One Lake Project .................................. 43 Development Agreement ............................. 46
Conditions of Approval ................................. 47 Public Infrastructure Improvements
Required for the One Lake Project .......... 50
Improvement Area No. 1 Development
Status Summary ...................................... 50 Existing and Planned Sales to Merchant
Builders .................................................... 53 Entitlements ................................................. 54 Environmental Matters ................................. 54 Master Developer Financing Plan for
Improvement Area No. 1 .......................... 56
The Master Developer ................................. 58 Lennar Homes ............................................. 60 Other Merchant Builders .............................. 63 BOND OWNERS’ RISKS ................................. 65 Risks of Real Estate Secured Investments
Generally .................................................. 65 Limited Obligation of the City to Pay Debt
Service ..................................................... 65 Potential Early Redemption of Bonds from
Facilities Special Tax Prepayments ......... 65
Concentration of Property Ownership .......... 66
Levy and Collection of the Facilities Special
Tax ........................................................... 66 Property Tax Delinquencies ......................... 67 Future Property Development ...................... 68
Value to Lien Ratios ..................................... 68 Risks Related to Homeowners with High
Loan to Value Ratios ............................... 69 Payment of Facilities Special Tax is not a
Personal Obligation of the Property
Owners ..................................................... 69 Appraised Values ......................................... 69 Property Values ........................................... 69 Other Possible Claims Upon the Value of
Taxable Property ..................................... 72 Exempt Properties ....................................... 73 FDIC/Federal Government Interests in
Properties................................................. 73 Depletion of 2024 Reserve Fund ................. 75
Bankruptcy Delays ....................................... 75 Cyber Security ............................................. 76 Disclosure to Future Purchasers ................. 76
Public Health Emergencies .......................... 77 No Acceleration Provisions .......................... 77 Loss of Tax Exemption ................................ 77 IRS Audit of Tax-Exempt Bond Issues ........ 77
Impact of Legislative Proposals,
Clarifications of the Code and Court
Decisions on Tax Exemption ................... 77
Voter Initiatives ............................................ 78 No Ratings – Limited Secondary Market for
Bonds ....................................................... 80 LEGAL MATTERS ........................................... 80 Legal Opinions ............................................. 80 Tax Exemption ............................................. 80 No Litigation ................................................. 82 CONTINUING DISCLOSURE .......................... 82
NO RATING ..................................................... 84 UNDERWRITING ............................................. 84 PROFESSIONAL FEES .................................. 84

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TABLE OF CONTENTS
(continued)

APPENDIX A – General Information About the City of Fairfield and Solano County APPENDIX B – Amended and Restated Rate and Method of Apportionment of Special Tax for Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5)
APPENDIX C – Summary of Certain Provisions of the Fiscal Agent Agreement APPENDIX D – DTC and the Book-Entry Only System
APPENDIX E – Form of City Continuing Disclosure Certificate APPENDIX F – Form of Master Developer and Merchant Builder Continuing Disclosure Certificate APPENDIX G – Form of Opinion of Bond Counsel
APPENDIX H – Appraisal Report
APPENDIX I – Community Facilities District Boundary Map

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[REGIONAL LOCATION MAP]

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[AERIAL PHOTO]

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__________________________________

OFFICIAL STATEMENT
__________________________________

$_____________*
IMPROVEMENT AREA NO. 1 OF THE

CITY OF FAIRFIELD
COMMUNITY FACILITIES DISTRICT NO. 2023-1
(ONE LAKE PLANNING AREA 5)
SPECIAL TAX BONDS, SERIES 2024A

INTRODUCTION

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, including the cover page, the inside cover and attached appendices, and the documents summarized or described in this Official Statement. A full review should be made of the entire Official Statement. The offering of the 2024 Bonds to potential investors is made only by means of the entire Official Statement. Capitalized terms used but not defined in this Official Statement have the definitions given in the Fiscal Agent Agreement (as defined below).

This Official Statement, including the cover page, inside cover and attached appendices, is provided to furnish information regarding the bonds captioned above (the “2024 Bonds”) to be issued by the City of Fairfield (the “City”) for and on behalf of the “City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5)” (the “District”) with respect to its “Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5)” (“Improvement Area No. 1”).

The City. The City, which comprises approximately 37 square miles, is located in the County of Solano (the “County”) approximately 44 miles northeast of San Francisco and 42 miles west of Sacramento. For economic and demographic information regarding the City and County, see “APPENDIX A – GENERAL INFORMATION ABOUT THE CITY OF FAIRFIELD AND SOLANO COUNTY.”

Authority for Issuance of the 2024 Bonds. The 2024 Bonds are issued under the Act, a resolution adopted by the City Council of the City on ______________, 2024 (the “Resolution of Issuance”), and a Fiscal Agent Agreement, dated as of November 1, 2024 (the “Fiscal Agent Agreement”), by and between the City, for and on behalf of the District, and The Bank of New York Mellon Trust Company, N.A., as fiscal agent (the “Fiscal Agent”). See “THE 2024 BONDS – Authority for Issuance.”

Purpose of the 2024 Bonds. The proceeds of the 2024 Bonds will be used primarily to finance the acquisition and construction of certain facilities to be owned and operated by the City.

The proceeds of the 2024 Bonds will also be used to (i) fund a debt service reserve fund established and held by the Fiscal Agent under the Fiscal Agent Agreement (the “2024 Reserve Fund”), (ii) pay capitalized interest on the 2024 Bonds through September 1, 2025, and (iii) pay the costs of issuing the 2024 Bonds. See “FINANCING PLAN.”

* Preliminary; subject to change.

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The District. The District and Improvement Area No. 1 were formed and established in February 2023 by the City Council of the City (the “City Council”), as legislative body of the District, under the Mello-Roos Community Facilities Act of 1982, as amended (the “Act”), pursuant to a resolution adopted by the City Council following a public hearing, and a landowner election at which the qualified electors of Improvement Area No. 1 authorized the City to incur bonded indebtedness for the District with respect to Improvement Area No. 1 to be secured by the levy of the Facilities Special Taxes (as defined below), and approved the levy of special taxes for the purpose of financing authorized facilities (the “Facilities”) and authorized services in accordance with the Rate and Method of Apportionment of Special Tax for Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5) (the “Original Rate and Method”).

On October 15, 2024, the City completed change proceedings for Improvement Area No. 1 in order to (among other things) amend the Original Rate and Method and approve the Amended and Restated Rate and Method of Apportionment of Special Tax for Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5) (the “Amended Rate and Method”). See “THE DISTRICT AND IMPROVEMENT AREA NO. 1 – Formation and Background – Change Proceedings.”

Special Taxes. The Amended Rate and Method provides for a Facilities Special Tax (the “Facilities Special Tax”) to be levied for the payment of debt service on the Bonds and the costs of the Facilities, and a Services Special Tax (the “Services Special Tax”) which will be levied for certain public services after a Transition Event, which is generally defined as a determination that all Bonds have been fully repaid or defeased, and no further Facilities are intended to be funded with the proceeds of the Facilities Special Tax. Only the Facilities Special Tax is pledged toward the payment of debt service on the 2024 Bonds.

Security and Sources of Payment for the 2024 Bonds. Pursuant to the Fiscal Agent Agreement, the 2024 Bonds are secured by and payable from a first pledge of all of net proceeds of the Facilities Special Taxes (as more particularly defined in the Fiscal Agent Agreement, the “Special Tax Revenues”), on a parity with any additional bonds that may be issued in the future, subject to the conditions set forth in the Fiscal Agent Agreement. The 2024 Bonds will be additionally secured by certain funds and accounts established and held under the Fiscal Agent Agreement. See “SECURITY FOR THE 2024 BONDS.”

The 2024 Bonds are neither a general obligation of the City nor payable from the general fund of the City; and are instead limited obligations of the City payable from Special Tax Revenues as described herein. Except with respect to the Special Tax Revenues, neither the faith and credit nor the taxing power of the City or the State or any political subdivision thereof is pledged for the payment of the 2024 Bonds or interest thereon, and no Owner of the 2024 Bonds may compel the exercise of the taxing power by the City or the forfeiture of any of its property.

The principal of and interest on the 2024 Bonds, and premiums upon the redemption of any thereof, are not a debt of the City (except to the limited extent described in this Official Statement), the State of California or any of its political subdivisions, within the meaning of any constitutional or statutory limitation or restriction. The 2024 Bonds are not a legal or equitable pledge, charge, lien or encumbrance, upon any property or income, receipts or revenues of the City, except the Special Tax Revenues that are, under the terms of the Fiscal Agent Agreement, pledged for the payment of the 2024 Bonds and interest thereon. Neither the members of the City Council nor any persons executing the 2024 Bonds are liable personally on the 2024 Bonds by reason of their issuance.

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Debt Service Reserve Fund. In order to further secure the payment of principal of and interest on the 2024 Bonds and any series of 2024-Related Parity Bonds, i.e., Parity Bonds, the principal of and interest on which is payable from amounts in the 2024 Reserve Fund, a portion of the proceeds of the 2024 Bonds will be deposited into the 2024 Reserve Fund in an amount equal to the 2024 Reserve Requirement (as defined herein). See “FINANCING PLAN – Estimated Sources and Uses of Funds” and “SECURITY FOR THE 2024 BONDS – 2024 Reserve Fund.”

Redemption of 2024 Bonds before Maturity. The 2024 Bonds are subject to optional redemption, mandatory sinking fund redemption and mandatory redemption from prepaid Special Taxes. See “THE 2024 BONDS – Redemption.”

Covenant to Foreclose. The District has covenanted in the Fiscal Agent Agreement to cause foreclosure proceedings to be commenced and prosecuted against certain parcels with delinquent installments of the Facilities Special Taxes. See “SECURITY FOR THE 2024 BONDS – Covenant to Foreclose.”

One Lake Project Overview. The property in Improvement Area No. 1 is part of a 358.5- acre master-planned community known as “One Lake” (the “One Lake Project”) being developed by One Lake Holding LLC, a Delaware limited liability company (the “Master Developer”). The One Lake Project comprises the property known as Planning Area 4 and Planning Area 5 of the Fairfield Train Station Specific Plan, adopted by the City Council on July 26, 2011, as amended (“Specific Plan”).

The Master Developer anticipates that the One Lake Project will be developed in numerous phases that will ultimately consist of 1,937 single-family and multi-family homes and a 190-unit apartment complex, with approximately 20,000 square feet of commercial/retail space.

The Master Developer is not a homebuilder and is developing the property through the sale of finished lots to merchant builders.

The development of Planning Area 4 commenced in the summer of 2018. As described further herein, Planning Area 4, which is now nearly fully developed, will eventually consist of 833 housing units. Planning Area 4 was developed in four phases of single-family detached and attached lots. Phase 1A (187 single-family lots), phase 1B (151 single-family lots and 48 attached product lots), and phase 1C (121 single-family lots, 60 attached product lots, and a 3.8-acre public park) have been fully developed and sold to merchant builders. The horizontal improvements for Neighborhood 8 (56 single-family lots) of phase 1D are complete and the property was sold to a merchant builder. Neighborhood 9 of phase 1D may be developed for up to 200 3-story townhomes on 21.7 acres, depending on the market and costs. As of August 10, 2024, within Planning Area 4, approximately 595 building permits have been issued, and the merchant builders are reporting 468 escrow closings. In addition to aforementioned housing developments, a 5-acre site was sold to an affordable housing developer who constructed a 190-unit apartment complex, which is now fully rented. The 190-unit apartment complex is not part of CFD No. 2019-1.

Planning Area 5 consist of the property in Improvement Area No. 1 and Neighborhoods P and Q, which are currently zoned for multi-family housing units, and located within the Future Annexation Area of the District (as described herein). Planning Area 5 will ultimately consist of the following: (A) within Improvement Area No. 1, 10 low-density residential neighborhoods (816 units) and 6 medium density residential neighborhoods (116 units); and (B) within the Future Packet Page 225 of 530Attachment 3 Page 12 of 129

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Annexation Area, 172 multi-family units. With the exception Neighborhoods P and Q, the Master Developer has secured Tentative Map approval for the balance of Planning Area 5.

See “THE DISTRICT AND IMPROVEMENT AREA NO. 1” and “PROPERTY OWNERSHIP AND DEVELOPMENT STATUS.”

Property Ownership and Proposed Development in Improvement Area No. 1. The property within Improvement Area No. 1 is anticipated to be improved with 932 residential units,

12.77 acres of public parks, and public street improvements. The residential units are anticipated to consist of 816 single-family detached homes and 116 single-family detached courtyard cluster homes. As of August 28, 2024, the date of value of the Appraisal (as defined below), the property in Improvement Area No. 1 consisted of 131 finished lots, 40 substantially finished lots and 761 rough-graded lots.

As of August 28, 2024, Lennar Homes of California, LLC, a California limited liability company (“Lennar Homes”), had acquired 131 lots within Improvement Area No. 1. The ownership and development status of Improvement Area No. 1 as of August 28, 2024, is summarized below in the following table:

Property Owner
Number of
Lots Development Type Development Status
Master Developer 685 Single-Family Detached Rough Graded Master Developer 76 Courtyard Cluster Rough Graded
Master Developer 40 Courtyard Cluster Substantially Finished Lots Lennar Homes 131 Single-Family Detached Finished Lots (1) 932

(1) Includes 9 lots under construction with homes and permits pulled.

See “THE DISTRICT AND IMPROVEMENT AREA NO. 1” and “PROPERTY OWNERSHIP AND DEVELOPMENT STATUS.”

Assessed Valuation. The Fiscal Year 2024-25 assessed valuation of the taxable property within Improvement Area No. 1 of the District is $______________. See “THE DISTRICT AND IMPROVEMENT AREA NO. 1.”

Appraisal. An appraisal of the property within Improvement Area No. 1 of the District dated September 29, 2024 (the “Appraisal”), was prepared by BBG, Inc., Sacramento, California (the “Appraiser”) in connection with the issuance of the 2024 Bonds. The purpose of the Appraisal was to estimate the fee simple market value of the properties within Improvement Area No. 1 by ownership, subject to the lien of the Facilities Special Tax, with the sum of values by ownership representing an aggregate value, as of an August 28, 2024 date of value. Subject to the assumptions and limiting conditions contained in the Appraisal, the Appraiser estimated that the taxable property within Improvement Area No. 1, as of the August 28, 2024, date of value, had an estimated not-less-than market value of $110,300,000. See “THE DISTRICT AND IMPROVEMENT AREA NO. 1 – Appraised Values” and “APPENDIX H – APPRAISAL REPORT” for further information on the Appraisal.

Risk Factors Associated with Purchasing the 2024 Bonds. Investment in the 2024 Bonds involves a significant degree of risk and each prospective investor should consider its financial condition and the risks involved to determine the suitability of investing in the 2024 Bonds. See “BOND OWNERS' RISKS” for a discussion of certain risk factors which should be Packet Page 226 of 530Attachment 3 Page 13 of 129

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considered, in addition to the other matters set forth in this Official Statement, in considering the investment quality of the 2024 Bonds.

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FINANCING PLAN

Facilities Financing Plan

The net proceeds of the 2024 Bonds will be used to construct or acquire various facilities authorized to be financed by the District. The City anticipates that the 2024 Bond proceeds will provide approximately $____ to finance acquisition and construction by the City of a new fire station (“Fire Station 39”) to serve the One Lake Project, and the remaining net proceeds will finance other authorized facilities. See “THE DISTRICT AND IMPROVEMENT AREA NO. 1 – Authorized Facilities” for a description of the authorized facilities.

For the current status of the construction of Facilities in Improvement Area No. 1 to be financed in part with the net proceeds of the 2024 Bonds, see “PROPERTY OWNERSHIP AND DEVELOPMENT STATUS – Public Improvements Required for the One Lake Project.”

Estimated Sources and Uses of Funds

The estimated proceeds from the sale of the 2024 Bonds will be deposited into the following funds established under the Fiscal Agent Agreement:

SOURCES Amount
Principal Amount of 2024 Bonds
Plus: Original Issue Premium
Less: Underwriter’s Discount
Total Sources

USES
Deposit into Capitalized Interest Account(1)
Deposit into Bond Proceeds Account of Improvement Fund
Deposit into 2024 Reserve Fund(2)
Deposit into Costs of Issuance Fund(3)
Total Uses

(1) To pay capitalized interest on the 2024 Bonds through September 1, 2025. (2) To satisfy the 2024 Reserve Requirement on the Closing Date. (3) Includes, among other things, the fees and expenses of Bond Counsel and Disclosure Counsel, costs of printing the preliminary and final Official Statements, and the fees and expenses of the Fiscal Agent, the Municipal Advisor, the Appraiser, and the Special Tax Consultant.

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THE 2024 BONDS

This section generally describes the terms of the 2024 Bonds contained in the Fiscal Agent Agreement, which is summarized in more detail in APPENDIX C. Capitalized terms used but not defined in this section are defined in APPENDIX C.

Authority for Issuance

The 2024 Bonds are issued under the Act, the Resolution of Issuance and the Fiscal Agent Agreement. Under the Resolution of Issuance, the 2024 Bonds may be issued in a maximum principal amount of $36,500,000.

General Bond Terms

Dated Date, Maturity and Authorized Denominations. The 2024 Bonds will be dated their date of delivery (the “Dated Date”), which is the Closing Date, and will mature in the amounts and on the dates set forth on the inside cover page of this Official Statement. The 2024 Bonds will be issued in fully registered form in the Authorized Denomination of $5,000 or any integral multiple thereof.

Calculation of Interest. Interest will be calculated on the basis of a 360-day year composed of twelve 30-day months. The 2024 Bonds will bear interest at the annual rates set forth on the inside cover page of this Official Statement, payable semiannually on each March 1 and September 1, commencing March 1, 2025 (each, an “Interest Payment Date”).

Each 2024 Bond shall bear interest from the Interest Payment Date next preceding the date of authentication thereof unless

(i) it is authenticated on an Interest Payment Date, in which event it shall bear interest from such date of authentication, or

(ii) it is authenticated prior to an Interest Payment Date and after the close of business on the Record Date preceding such Interest Payment Date, in which event it shall bear interest from such Interest Payment Date, or

(iii) it is authenticated on or before the Record Date preceding the first Interest Payment Date, in which event it shall bear interest from the Dated Date;

provided, however, that if at the time of authentication of a 2024 Bond, interest is in default thereon, such 2024 Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon.

“Record Date” means the 15th day of the calendar month next preceding the applicable Interest Payment Date, whether or not such day is a Business Day.

DTC and Book-Entry Only System. DTC will act as securities depository for the 2024 Bonds. The 2024 Bonds will be issued as fully-registered securities registered initially in the name of Cede & Co. (DTC’s partnership nominee). See “– Registration of Exchange or Transfer” below for a description of such release test, and “APPENDIX D – DTC AND THE BOOK-ENTRY ONLY SYSTEM” for a description of DTC and DTC’s book-entry system.

Payments of Interest and Principal. For so long as DTC is used as depository for the 2024 Bonds, principal of, premium, if any, and interest payments on the 2024 Bonds will be made Packet Page 229 of 530Attachment 3 Page 16 of 129

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solely to DTC or its nominee, Cede & Co., as registered owner of the 2024 Bonds, for distribution to the beneficial owners of the 2024 Bonds in accordance with the procedures adopted by DTC.

Interest on the 2024 Bonds (including the final interest payment upon maturity or earlier redemption), is payable on the applicable Interest Payment Date by check of the Fiscal Agent mailed by first class mail to the registered Owner thereof at such registered Owner’s address as it appears on the registration books maintained by the Fiscal Agent at the close of business on the Record Date preceding the Interest Payment Date, or by wire transfer to an account located in the United States of America made on such Interest Payment Date upon written instructions of any Owner of $1,000,000 or more in aggregate principal amount of 2024 Bonds delivered to the Fiscal Agent prior to the applicable Record Date, which will continue in effect until revoked in writing, or until such 2024 Bonds are transferred to a new Owner.

The principal of and any premium on the 2024 Bonds are payable in lawful money of the United States of America, with principal and any premium payable upon surrender of the 2024 Bonds at the Principal Office of the Fiscal Agent.

Redemption*

Optional Redemption. The 2024 Bonds maturing on or before September 1, 20__, are not subject to optional redemption prior to their stated maturity. The 2024 Bonds maturing on or after September 1, 20__, are subject to redemption, as a whole or in part at the election of the City among maturities on such basis as designated by the City and by lot within a maturity, at the option of the City, on September 1, 20__, and on any date thereafter, at a redemption price equal to 100% of the principal amount of 2024 Bonds to be redeemed, together with accrued interest thereon to the date fixed for redemption, without premium.

Mandatory Sinking Fund Redemption. The 2024 Bonds maturing on September 1, 20__ and September 1, 20__ (the “Term Bonds”), are subject to mandatory redemption in part by lot, from sinking fund payments made by the City from the Bond Fund, at a redemption price equal to the principal amount thereof to be redeemed, plus accrued interest to the redemption date, without premium, in the aggregate respective principal amounts all as set forth in the following tables:

2024 Bonds Maturing September 1, 20__

Sinking Fund
Redemption Date
(September 1)

Sinking Payments

(Maturity)

* Preliminary; subject to change.

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2024 Bonds Maturing September 1, 20__

Sinking Fund
Redemption Date
(September 1)

Sinking Payments

(Maturity)

Provided, however, if some but not all of the Term Bonds of a given maturity have been redeemed through optional redemption or mandatory prepayment redemption, the total amount of all future Sinking Fund Payments relating to such maturity will be reduced by the aggregate principal amount of Term Bonds of such maturity so redeemed, to be allocated among such Sinking Fund Payments on a pro rata basis in integral multiples of $5,000 as determined by the City, notice of which will be given by the City to the Fiscal Agent.

Redemption from Special Tax Prepayments. Special Tax Prepayments and any corresponding transfers from the 2024 Reserve Fund under the Fiscal Agent Agreement will be used to redeem 2024 Bonds on the next Interest Payment Date for which notice of redemption can timely be given under the Fiscal Agent Agreement, among series and maturities as provided in the Fiscal Agent Agreement, at a redemption price (expressed as a percentage of the principal amount of the 2024 Bonds to be redeemed), as set forth below, together with accrued interest to the date fixed for redemption:

Redemption Dates Redemption Price
Any Interest Payment Date on or before March 1, ____
September 1, ____and March 1, ____
September 1, ____and March 1, ____
September 1, ____and any Interest Payment Date thereafter

Purchase in Lieu of Redemption. In lieu of redemption under the Fiscal Agent Agreement, moneys in the Bond Fund may be used and withdrawn by the Fiscal Agent for purchase of 2024 Bonds, upon the filing with the Fiscal Agent of an Officer’s Certificate requesting such purchase, at public or private sale as and when, and at such prices (including brokerage and other charges) as such Officer’s Certificate may provide, but in no event may 2024 Bonds be purchased at a price in excess of the principal amount thereof, plus interest accrued to the date of purchase and any premium which would otherwise be due if such 2024 Bonds were to be redeemed in accordance with the Fiscal Agent Agreement. Any 2024 Bonds purchased pursuant to this provision of the Fiscal Agent Agreement will be treated as outstanding 2024 Bonds under the Fiscal Agent Agreement, except to the extent otherwise directed by the Finance Director.

Notice of Redemption. The Fiscal Agent will cause notice of any redemption to be mailed by first-class mail, postage prepaid, at least 20 days but not more than 60 days prior to the date fixed for redemption, to the Securities Depositories, and to the respective registered Owners of any 2024 Bonds designated for redemption, at their addresses appearing on the registration books in the Principal Office of the Fiscal Agent; but such mailing will not be a condition precedent to such redemption and failure to mail or to receive any such notice, or any defect therein, will not affect the validity of the proceedings for the redemption of such 2024 Bonds. In addition, the Fiscal Agent will file each notice of redemption with the MSRB through its EMMA system. The sole remedy for failure to file such notices through EMMA shall be an action by the holders of the Bonds in mandamus for specific performance or a similar remedy to compel performance.

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However, while the 2024 Bonds are subject to DTC’s book-entry system, the Fiscal Agent will be required to give notice of redemption only to DTC as provided in the letter of representations executed by the City and received and accepted by DTC. DTC and the Participants will have sole responsibility for providing any such notice of redemption to the Beneficial Owners of the 2024 Bonds to be redeemed. Any failure of DTC to notify any Participant, or any failure of Participants to notify the Beneficial Owner of any 2024 Bonds to be redeemed, of a notice of redemption or its content or effect will not affect the validity of the notice of redemption, or alter the effect of redemption set forth in the Fiscal Agent Agreement.

Conditional Redemption Notice; Rescission of Redemption. Notices of optional redemption may be conditional. The City has the right to rescind any notice of the optional redemption of 2024 Bonds by written notice to the Fiscal Agent on or prior to the date fixed for redemption. Any notice of redemption will be cancelled and annulled if for any reason funds will not be or are not available on the date fixed for redemption for the payment in full of the 2024 Bonds then called for redemption, and such cancellation will not constitute a default under the Fiscal Agent Agreement.

The City and the Fiscal Agent have no liability to the Owners or any other party related to or arising from such rescission of redemption. The Fiscal Agent will mail notice of such rescission of redemption in the same manner as the original notice of redemption was sent under the Fiscal Agent Agreement.

Partial Redemption. Whenever provision is made in the Fiscal Agent Agreement for the redemption of less than all the Bonds of any maturity or any given portion thereof, unless otherwise directed by the City, the Fiscal Agent will select the Bonds to be redeemed from all Bonds or such given portion thereof not previously called for redemption as directed by the City or, in the absence of direction by the City, on a pro rata basis, among series and maturities, and, so as to maintain substantially the same Debt Service profile for the Bonds as in effect prior to such redemption, and by lot within a maturity, in any manner which the Fiscal Agent in its sole discretion deems appropriate.

Effect of Redemption. From and after the date fixed for redemption, if funds available for the payment of the principal of, and interest and any premium on, the 2024 Bonds so called for redemption shall have been deposited in the Bond Fund, such 2024 Bonds so called shall cease to be entitled to any benefit under the Fiscal Agent Agreement other than the right to receive payment of the redemption price, and no interest shall accrue thereon on or after the redemption date specified in the notice of redemption.

Issuance of Future Parity Bonds

Parity Bonds. In addition to the 2024 Bonds, but subject to the maximum bonded indebtedness limit for Improvement Area No. 1, the City may issue one or more additional series of bonds or other indebtedness (collectively, “Parity Bonds”) payable from the Special Tax Revenues on a parity with the 2024 Bonds, in such principal amount as may be determined by the City, under a Supplemental Agreement entered into by the City and the Fiscal Agent. Any such Parity Bonds will constitute Bonds under the Fiscal Agent Agreement and will be secured by a lien on the Special Tax Revenues and funds pledged for the payment of the 2024 Bonds under the Fiscal Agent Agreement on a parity with all other Bonds Outstanding thereunder, except as provided in the Fiscal Agent Agreement or in a Supplemental Agreement.

The City may issue such Parity Bonds if the City complies with the following conditions precedent set forth in the Fiscal Agent Agreement:

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(A) Compliance. Following issuance of the Parity Bonds, the City must be in compliance with all covenants set forth in the Fiscal Agent Agreement and all Supplemental Agreements, and issuance of the Parity Bonds may not cause the City to exceed the bonded indebtedness limit of Improvement Area No. 1.

(B) Same Payment Dates. The Supplemental Agreement providing for the issuance of such Parity Bonds must provide that interest thereon will be payable on the Interest Payment Dates, and principal thereof will be payable on the same date in any year in which principal is payable on the 2024 Bonds (provided that there shall be no requirement that any Parity Bonds pay interest on a current basis).

(C) Separate Funds; Debt Service Reserve Fund. The Supplemental Agreement providing for the issuance of such Parity Bonds may provide for the establishment of separate funds and accounts.

The Supplemental Agreement providing for issuance of the Parity Bonds will provide for one of the following: (i) a deposit to the 2024 Reserve Fund in an amount necessary such that the amount deposited therein shall equal the 2024 Reserve Requirement following issuance of the Parity Bonds, (ii) a deposit to a reserve account for the Parity Bonds (and such other series of Parity Bonds identified by the City) in an amount defined in such Supplemental Agreement, as long as such Supplemental Agreement expressly declares that the Owners of such Parity Bonds will have no interest in or claim to the 2024 Reserve Fund and that the Owners of the Bonds covered by the 2024 Reserve Fund will have no interest in or claim to such other reserve account or (iii) no deposit to either the 2024 Reserve Fund or another reserve account as long as such Supplemental Agreement expressly declares that the Owners of such Parity Bonds will have no interest in or claim to the 2024 Reserve Fund or any other reserve account.

(D) Improvement Area No. 1 Value. The Improvement Area No. 1 Value must be at least three times the sum of: (i) the aggregate principal amount of all Bonds then Outstanding, plus (ii) the aggregate principal amount of the series of Parity Bonds proposed to be issued, plus (iii) the aggregate principal amount of any fixed assessment liens on the parcels in Improvement Area No. 1 subject to the levy of Special Taxes, plus (iv) a portion of the aggregate principal amount of any and all other community facilities district bonds then outstanding and payable at least partially from special taxes to be levied on parcels of land within Improvement Area No. 1 (the “Other District Bonds”) equal to the aggregate principal amount of the Other District Bonds multiplied by a fraction, the numerator of which is the amount of special taxes levied for the Other District Bonds on parcels of land within Improvement Area No. 1, and the denominator of which is the total amount of special taxes levied for the Other District Bonds on all parcels of land against which the special taxes are levied to pay the Other District Bonds (such fraction to be determined based upon the maximum assigned special taxes which could be levied in the year in which maximum annual debt service on the Other District Bonds occurs), based upon information from the most recent available Fiscal Year.

(E) Undeveloped Property Value. The Undeveloped Property Value must be at least three times the sum of: (i) the proportionate share of the amounts described in clauses (i) and (ii) of the preceding subsection (D) determined by multiplying the aggregate of the amounts described in such clauses (i) and (ii) by a fraction, the numerator of which is the amount of Special Taxes to be levied on Undeveloped Property in the Fiscal Year following the then current Fiscal Year (without regard to any capitalized interest for any Parity Bonds), and the denominator of which is the total amount of Special Taxes to be Packet Page 233 of 530Attachment 3 Page 20 of 129

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levied on property in Improvement Area No. 1 in the Fiscal Year following the then current Fiscal Year, based upon information from the most recent available Fiscal Year, plus (ii) the aggregate principal amount of any fixed assessment liens on the Undeveloped Property, plus (iii) a portion of the aggregate principal amount of any Other District Bonds (as defined in the preceding subsection (D)) equal to the aggregate principal amount of the Other District Bonds multiplied by a fraction, the numerator of which is the amount of special taxes levied for the Other District Bonds on Undeveloped Property, and the denominator of which is the total amount of special taxes levied for the Other District Bonds on all parcels of real property against which the special taxes are levied to pay the Other District Bonds (such fraction to be determined based upon the maximum assigned special taxes which could be levied in the year in which maximum annual debt service on the Other District Bonds occurs), based upon information from the most recent available Fiscal Year. If 100% of the debt service on the Bonds after the issuance of the proposed Parity Bonds is expected to be derived from Special Taxes levied on Developed Property, then the provisions of this subsection (E) will not apply to the proposed issuance of Parity Bonds.

(F) Coverage. The amount of the maximum Special Taxes that may be levied in each Fiscal Year under the Ordinance, the Agreement and any Supplemental Agreement must be no lower than (i) 110% of the total Annual Debt Service of the then Outstanding Bonds and the proposed Parity Bonds and (ii) 100% of the total Annual Debt Service of the then Outstanding Bonds and the proposed Parity Bonds and the amount of the levy for Administrative Expenses in the current fiscal year. In addition, the aggregate Special Tax Prepayments that could occur after the issuance of the Parity Bonds must be not less than the principal amount of the Outstanding Bonds and the proposed Parity Bonds.

(G) Certificates. The City must deliver to the Fiscal Agent an Officer's Certificate certifying that the conditions precedent to the issuance of such Parity Bonds set forth in subsections (A), (B), (C), (D), (E), and (F) above have been satisfied.

Limitation on Principal Amount of Parity Bonds. Pursuant to the Fiscal Agent Agreement, the City will covenant, following issuance of the 2024 Bonds, not to issue more than $_______________* initial principal amount of Parity Bonds (exclusive of any Refunding Bonds).

See “THE DISTRICT AND IMPROVEMENT AREA NO. 1 – Formation and Background.”

Refunding Bonds. Notwithstanding the foregoing, the City may issue Refunding Bonds as Parity Bonds without the need to satisfy the requirements of clauses (D), (E), or (F) above, and, in connection therewith, the Officer’s Certificate in clause (G) above need not make reference to said clauses (D), (E), and (F).

Under the Fiscal Agent Agreement, the term “Refunding Bonds” is defined as bonds issued by the City for with respect to Improvement Area No. 1, the net proceeds of which are used to refund all or a portion of the then-Outstanding Bonds; provided that the principal and interest on the Refunding Bonds to their final maturity date is less than the principal and interest on the Bonds being refunded to their final maturity date, and the final maturity of the Refunding Bonds is not later than the final maturity of the Bonds being refunded.

Subordinate Bonds. Nothing in the Fiscal Agent Agreement prohibits the City from issuing any other bonds or otherwise incurring debt secured by a pledge of the Special Tax Revenues subordinate to the pledge thereof under the Fiscal Agent Agreement.

* Preliminary; subject to change.

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Registration, Transfer and Exchange

The following provisions regarding the exchange and transfer of the 2024 Bonds apply only during any period in which the 2024 Bonds are not subject to DTC’s book-entry system.

While the 2024 Bonds are subject to DTC’s book-entry system, their exchange and transfer will be effected through DTC and the Participants and will be subject to the procedures, rules and requirements established by DTC. See “APPENDIX D – DTC AND THE BOOK-ENTRY ONLY SYSTEM.”

Registration. The Fiscal Agent will keep, or cause to be kept, at its Principal Office sufficient books for the registration and transfer of the 2024 Bonds, which will show the series number, date, amount, rate of interest and last known owner of each 2024 Bond and will at all times be open to inspection by the City during regular business hours upon reasonable notice; and, upon presentation for such purpose, the Fiscal Agent will, under such reasonable regulations as it may prescribe, register or transfer or cause to be registered or transferred, on said books, the ownership of the 2024 Bonds as provided in the Fiscal Agent Agreement. The City and the Fiscal Agent will treat the Owner of any 2024 Bond whose name appears on the Bond register as the absolute Owner of such 2024 Bond for any and all purposes, and the City and the Fiscal Agent will not be affected by any notice to the contrary. The City and the Fiscal Agent may rely on the address of the Owner as it appears in the Bond register for any and all purposes.

Registration of Exchange or Transfer. Any 2024 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 such person’s duly authorized attorney, upon surrender of such 2024 Bond for cancellation, accompanied by delivery of a duly written instrument of transfer in a form acceptable to the Fiscal Agent. 2024 Bonds may be exchanged at the Principal Office of the Fiscal Agent solely for a like aggregate principal amount of 2024 Bonds of authorized denominations and of the same maturity. The cost for any services rendered or any expenses incurred by the Fiscal Agent in connection with any such transfer or exchange will be paid by the City from amounts in the Administrative Expense Fund. The Fiscal Agent will collect from the Owner requesting such transfer or exchange any tax or other governmental charge required to be paid with respect to such transfer or exchange. Whenever any 2024 Bonds are surrendered for transfer or exchange, the City will execute and the Fiscal Agent will authenticate and deliver new 2024 Bonds for a like aggregate principal amount.

No transfers or exchanges of 2024 Bonds will be required to be made (i) 15 days prior to the date established by the Fiscal Agent for selection of 2024 Bonds for redemption or (ii) with respect to a 2024 Bond after such 2024 Bond has been selected for redemption; or (iii) between a Record Date and the succeeding Interest Payment Date. Prior to any transfer of the 2024 Bonds outside the book-entry system (including, but not limited to, the initial transfer outside the book- entry system) the transferor shall provide or cause to be provided to the Fiscal Agent all information necessary to allow the Fiscal Agent to comply with any applicable tax reporting obligations, including without limitation any cost basis reporting obligations under Internal Revenue Code Section 6045, as amended. The Fiscal Agent shall conclusively rely on the information provided to it and shall have no responsibility to verify or ensure the accuracy of such information.

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DEBT SERVICE SCHEDULE

The following table presents the annual Debt Service on the 2024 Bonds, assuming there are no optional redemptions or special redemptions from Facilities Special Tax prepayments.

Year Ending
September 1 Principal Interest
Total
Debt Service*
2025 (1)
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
2054
Total:

(1) Debt service on the 2024 Bonds on March 1, 2025, and September 1, 2025 is anticipated to be paid from proceeds of the 2024 Bonds to be deposited in the Capitalized Interest Account.

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SECURITY FOR THE 2024 BONDS

This section generally describes the security for the 2024 Bonds set forth in the Fiscal Agent Agreement, which is summarized in more detail in APPENDIX C. Capitalized terms used but not defined in the section are defined in APPENDIX C.

General

The 2024 Bonds and any additional Parity Bonds (collectively, the “Bonds”) are secured by a first pledge (which will be effected in the manner and to the extent provided in the Fiscal Agent Agreement) of all of the Special Tax Revenues and all moneys deposited in the Bond Fund (including the Special Tax Prepayments Account), and, until disbursed as provided therein, in the Special Tax Fund.

The Special Tax Revenues and all moneys deposited into such funds (except as otherwise provided in the Fiscal Agent Agreement) are dedicated to the payment of the principal of, and interest and any premium on, the Bonds as provided in the Fiscal Agent Agreement and in the Act until all of the Bonds have been paid and retired or until moneys or Federal Securities have been set aside irrevocably for that purpose under the Fiscal Agent Agreement.

The 2024 Bonds and all 2024-Related Parity Bonds will be secured by a first pledge (which pledge will be effected in the manner and to the extent provided in the Fiscal Agent Agreement) of all moneys deposited in the 2024 Reserve Fund. The moneys in the 2024 Reserve Fund (except as otherwise provided in the Fiscal Agent Agreement) are dedicated to the payment of the principal of, and interest and any premium on, the 2024 Bonds and all 2024-Related Parity Bonds as provided in the Fiscal Agent Agreement and in the Act until all of the 2024 Bonds and all 2024-Related Parity Bonds have been paid and retired or until moneys or Federal Securities have been set aside irrevocably for that purpose under the Fiscal Agent Agreement.

Under the Fiscal Agent Agreement, “2024-Related Parity Bonds” means any series of Parity Bonds for which (i) the proceeds are deposited into the 2024 Reserve Fund so that the balance therein is equal to the 2024 Reserve Requirement following issuance of such Parity Bonds and (ii) the related Supplemental Agreement specifies that the 2024 Reserve Fund shall act as a reserve for the payment of the principal of, and interest and any premium on, such series of Parity Bonds.

The 2024 Bonds shall be secured by a first pledge (which will be effected in the manner and to the extent provided in the Fiscal Agent Agreement) of all moneys deposited in the Capitalized Interest Account.

Amounts in the Improvement Fund (and all subaccounts therein), the Administrative Expense Fund and the Costs of Issuance Fund are not pledged to the repayment of the Bonds.

The Project is not pledged to the repayment of the Bonds, nor are the proceeds of any condemnation or insurance award received by the City with respect to the Project.

“Special Tax Revenues” are defined in the Fiscal Agent Agreement as the proceeds of the Facilities Special Taxes received by the City, including any scheduled payments thereof and any Facilities Special Tax Prepayments, interest thereon and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Facilities Special Taxes to the amount of said lien and interest thereon. However, Special Tax Revenues do not include any interest in excess of the interest due on the 2024 Bonds, or any penalties collected in connection with any such foreclosure.

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Limited Obligation

Facilities Special Taxes

Covenant to Levy Facilities Special Taxes. Under the Fiscal Agent Agreement, the Finance Director will fix and levy the amount of Facilities Special Taxes within Improvement Area No. 1 required for the payment of principal of and interest on any outstanding Bonds of the District with respect to Improvement Area No. 1 becoming due and payable during the ensuing calendar year, including any necessary replenishment or expenditure of the 2024 Reserve Fund and any other reserve account for Parity Bonds that are not 2024-Related Parity Bonds, and an amount estimated to be sufficient to pay the Administrative Expenses, including amounts necessary to discharge any rebate obligation, during such year, taking into account the balances in the applicable funds established under the Fiscal Agent Agreement and funds in the Special Tax Fund. The Facilities Special Taxes so levied may not exceed the authorized amounts as provided in the proceedings under the Resolution of Formation.

Manner of Collection. Except as set forth in the Ordinance, the Fiscal Agent Agreement provides that the Facilities Special Taxes will be payable and be collected in the same manner and at the same time and in the same installment as the general taxes on real property are payable, and have the same priority, become delinquent at the same time and in the same proportionate amounts and bear the same proportionate penalties and interest after delinquency as do the ad valorem taxes on real property. The City is authorized to employ consultants to assist in computing the levy of the Facilities Special Taxes under the Fiscal Agent Agreement and any reconciliation of amounts levied to amounts received. The fees and expenses of such consultants and the costs and expenses of the City (including a charge for staff time) in conducting its duties under the Fiscal Agent Agreement will be an Administrative Expense.

Because the Facilities Special Tax levy is limited to the maximum Facilities Special Tax rates set forth in the Amended Rate and Method, no assurance can be given that, in the event of Facilities Special Tax delinquencies, the receipts of Facilities Special Taxes will, in fact, be collected in sufficient amounts in any given year to pay Debt Service on the Bonds. Further, under no circumstances will the Facilities Special Tax levied against any parcel of residential property for which an occupancy permit for private residential use has been issued be increased by more than 10% as a consequence of delinquency or default by the owner of any other parcel within the District. In addition, in no event shall Facilities Special Taxes be levied after the earlier of (i) the Packet Page 238 of 530Attachment 3 Page 25 of 129

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Fiscal Year prior to the Transition Year (as hereinafter defined) or (ii) Fiscal Year 2073-74. See “BOND OWNERS’ RISKS – Property Tax Delinquencies.”

Amended Rate and Method

General. The District is legally authorized and has covenanted in the Fiscal Agent Agreement to cause the levy of the Facilities Special Taxes in Improvement Area No. 1 in an amount determined according to the Amended Rate and Method. The Amended Rate and Method apportions the total amount of the Facilities Special Tax to be collected among the Taxable Property in Improvement Area No. 1 as more particularly described below. The Services Special Tax may only be levied and collected after the Transition Event (as defined below), and therefore will not be collected while Bonds are outstanding.

Following is a summary of the provisions of the Amended Rate and Method, which should be read in conjunction with the complete text of the Amended Rate and Method, including its attachments, which is attached as APPENDIX B. Capitalized terms used but not defined in this section have the meanings as set forth in APPENDIX B.

Facilities Special Tax Requirement. Annually, at the time of levying the Facilities Special Tax within Improvement Area No. 1, the Administrator will determine the “Facilities Special Tax Requirement,” which is defined as the amount necessary in any Fiscal Year to:

(i) to pay principal and interest on Bonds which are due in the calendar year which begins in such Fiscal Year,

(ii) to replenish reserve funds to the extent such replenishment has not been included in a computation of the Facilities Special Tax Requirement in a previous Fiscal Year,

(iii) to cure any delinquencies in the payment of principal or interest on Bonds which have occurred in the prior Fiscal Year,

(iv) to pay Administrative Expenses, and

(v) to pay the costs of Authorized Facilities to be funded directly from Facilities Special Tax proceeds to the extent that paying directly for such costs does not increase the Facilities Special Taxes levied on Final Map Property or Undeveloped Property.

The amounts referred to in clauses (i) and (ii) above may be reduced in any Fiscal Year by (i) interest earnings on or surplus balances in funds and accounts for Bonds to the extent that such earnings or balances are available to apply against debt service pursuant to the Fiscal Agent Agreement, (ii) proceeds from the collection of penalties associated with delinquent Facilities Special Taxes, and (iii) any other revenues available to pay debt service on the Bonds as determined by the Administrator.

Annual Determination of Property Categories for Administration of Special Tax.

Each Fiscal Year, the Administrator shall:

(i) categorize each Parcel of Taxable Property as Developed Property, Final Map Property, Undeveloped Property, Taxable Owners Association Property, Taxable Public Property, Taxable Affordable Housing Unit, or Taxable Welfare Exemption Property;

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(ii) for Developed Property, categorize each Parcel as Single Family Attached Property, Single Family Detached Property, Multi-Family Property, or Non-Residential Property;

(iii) assign each Residential Unit to the appropriate Special Tax Category;

(iv) determine if any of the Residential Units are Affordable Housing Units;

(v) determine if the Transition Event occurred in the prior Fiscal Year; and

(vi) determine the Facilities Special Tax Requirement or Services Special Tax Requirement for the Fiscal Year, as applicable.

In addition, the Administrator shall, on an ongoing basis, monitor changes to the Tentative Map, track all Building Permits that have been issued, and review all condominium plans that have been recorded to determine if there are any proposed Land Use Changes that would affect the Expected Maximum Facilities Special Tax Revenues. If the Expected Maximum Facilities Special Tax Revenues will be revised pursuant to a proposed Land Use Change, the Administrator shall apply the steps set forth in Section D of the Amended Rate and Method (see “– Changes to Maximum Facilities Special Tax” below).

In any Fiscal Year, if it is determined that: (i) a parcel map for property in Improvement Area No. 1 was recorded after January 1 of the prior Fiscal Year (or any other date after which the Assessor will not incorporate the newly-created Parcels into the then current tax roll), (ii) because of the date the parcel map was recorded, the Assessor does not yet recognize the new Parcels created by the parcel map, and (iii) one or more of the newly-created Parcels is in a different Development Class than other Parcels created by the subdivision, the Administrator shall calculate the Special Tax for the property affected by recordation of the parcel map by determining the Special Taxes that apply separately to the property within each Development Class, then applying the sum of the individual Special Taxes to the Parcel that was subdivided by recordation of the parcel map.

The following terms are defined in the Amended Rate and Method as follows:

“Developed Property” means, in any Fiscal Year, all Parcels of Taxable Property that are not Taxable Owners Association Property, Taxable Public Property, or Taxable Welfare Exemption Property for which a Building Permit for new construction was issued prior to June 30 of the preceding Fiscal Year. Taxable Affordable Housing Units on Parcels of Developed Property shall be taxed, if required, pursuant to the Amended Rate and Method.

“Final Map Property” means, in any Fiscal Year, all property for which a Final Map had recorded prior to June 30 of the preceding Fiscal Year and which has not yet become Developed Property, not including Taxable Owners Association Property, Taxable Welfare Exemption Property, or Taxable Public Property.

“Multi-Family Property” means, in any Fiscal Year, all Parcels of Developed Property for which Building Permits were issued for construction of a residential structure with five or more Residential Units that are offered for rent to the general public and cannot be purchased by individual homebuyers.

“Non-Residential Property” means, in any Fiscal Year, all Parcels of Developed Property that are not Single Family Attached Property, Single Family Detached Property, Packet Page 240 of 530Attachment 3 Page 27 of 129

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Multi-Family Property, Taxable Owners Association Property, Taxable Public Property, or Taxable Welfare Exemption Property.

“Single Family Attached Property” means, in any Fiscal Year, all Parcels of Developed Property for which a Building Permit was issued for construction of a residential structure consisting of two or more Residential Units that share common walls, have separate Assessor’s Parcel numbers assigned to them (except for a duplex unit, which may share a Parcel with another duplex unit), and may be purchased by individual homebuyers (which shall still be the case even if the Residential Units are purchased and subsequently offered for rent by the owner), including such residential structures that meet the statutory definition of a condominium contained in Civil Code Section 1351.

“Single Family Detached Property” means, in any Fiscal Year, all Parcels of Developed Property for which Building Permits were issued for construction of a Residential Unit that does not share a common wall with another Residential Unit.

“Taxable Owners Association Property” means, in any Fiscal Year after the First Bond Sale, any Parcel of Owners Association Property that satisfies all three of the following conditions: (i) the Parcel had not been Owners Association Property on the date of the First Bond Sale; (ii) based on reference to Attachments 1 and 2 to the Amended Rate and Method (as may be updated pursuant to Section D of the Amended Rate and Method), the Parcel was not anticipated to be Owners Association Property based on the Expected Land Uses, as determined by the Administrator; and (iii) if the Parcel were to be exempt from the Facilities Special Tax because it has become Owners Association Property, the Expected Maximum Facilities Special Tax Revenues would be reduced to a point at which Required Coverage could not be maintained.

“Taxable Property” means all Parcels within Improvement Area No. 1 that are not exempt from the Special Tax pursuant to law or Section G of the Amended Rate and Method.

“Taxable Affordable Housing Unit” means in any Fiscal Year after the First Bond Sale, any Residential Unit that satisfies both of the following conditions: (i) based on reference to Attachments 1 and 2 (as may be updated pursuant to Section D of the Amended Rate and Method), the Residential Unit was not anticipated to be an Affordable Housing Unit based on the Expected Land Uses, as determined by the Administrator; and (ii) if the Parcel were to be exempt from the Facilities Special Tax because it has become an Affordable Housing Unit, the Expected Maximum Facilities Special Tax Revenues would be reduced to a point at which Required Coverage could not be maintained.

“Taxable Public Property” means in any Fiscal Year after the First Bond Sale, any Parcel of Public Property that satisfies all three of the following conditions: (i) the Parcel had not been Public Property on the date of issuance of the First Bond Sale; (ii) based on reference to Attachments 1 and 2 to the Amended Rate and Method (as may be updated pursuant to Section D of the Amended Rate and Method), the Parcel was not anticipated to be Public Property based on the Expected Land Uses, as determined by the Administrator; and (iii) if the Parcel were to be exempt from the Facilities Special Tax because it has become Public Property, the Expected Maximum Facilities Special Tax Revenues would be reduced to a point at which Required Coverage could not be maintained.

“Taxable Welfare Exemption Property” means in any Fiscal Year after the First Bond Sale, any Parcel of Welfare Exemption Property that satisfies all three of the Packet Page 241 of 530Attachment 3 Page 28 of 129

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following conditions: (i) the Parcel had not been Welfare Exemption Property on the date of issuance of the First Bond Sale; (ii) based on reference to Attachments 1 and 2 (as may be updated pursuant to Section D of the Amended Rate and Method), the Parcel was not anticipated to be Welfare Exemption Property based on the Expected Land Uses, as determined by the Administrator; and (iii) if the Parcel were to be exempt from the Special Tax because it has become Welfare Exemption Property, the Expected Maximum Facilities Special Tax Revenues would be reduced to a point at which Required Coverage could not be maintained.

“Transition Event” shall be deemed to have occurred when the Administrator determines that the following events have occurred: (i) all Bonds secured by the levy and collection of Facilities Special Taxes have been fully repaid, or there are sufficient revenues available to fully repay the Bonds in funds and accounts that, pursuant to the Fiscal Agent Agreement, will require such revenues to be applied to repay the Bonds; (ii) all Administrative Expenses from prior Fiscal Years have been paid or reimbursed to the City; and (iii) there are no other Authorized Facilities that the City intends to fund with Bonds and Facilities Special Taxes.

“Transition Year” means the first Fiscal Year in which the Administrator determines that the Transition Event occurred in the prior Fiscal Year.

“Undeveloped Property” means, in any Fiscal Year, all Parcels of Taxable Property that are not Final Map Property, Developed Property, Taxable Owners Association Property, Taxable Public Property, or Taxable Welfare Exemption Property.

Maximum Facilities Special Tax.

Developed Property. The Maximum Facilities Special Tax for Parcels of Single Family Attached Property, Single Family Detached Property, Multi-Family Property, and Non-Residential Property shall be the greater of (i) the Target Facilities Special Tax described in the table below, or (ii) the Maximum Facilities Special Tax determined pursuant to Section D of the Amended Rate and Method (see “– Changes to Maximum Facilities Special Tax” below).

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Target Facilities Special Tax
Developed Property

Facilities
Special Tax Category
Target Facilities
Special Tax
Before Transition Year
(As of Fiscal Year
2025-26)*
Single Family Detached Property
Greater than or Equal to 3,000 Square Feet
2,800 – 2,999 Square Feet
2,600 – 2,799 Square Feet
2,400 – 2,599 Square Feet
2,200 – 2,399 Square Feet
Less than 2,200 Square Feet

$5,850 per Residential Unit
$5,344 per Residential Unit
$4,909 per Residential Unit
$4,656 per Residential Unit
$4,475 per Residential Unit
$4,149 per Residential Unit

Single Family Attached Property
Greater than or Equal to 1,800 Square Feet
Less than 1,800 Square Feet

$4,095 per Residential Unit
$3,914 per Residential Unit

Multi-Family Property

$65,213 per Acre

Non-Residential Property

$65,213 per Acre

* On each July 1, each Target Facilities Special Tax shown above shall be increased by an amount equal to 2.0% of the amount in effect for the prior Fiscal Year.

Once a Facilities Special Tax has been levied on a Parcel of Developed Property, the Maximum Facilities Special Tax applicable to that Parcel shall not be reduced in future Fiscal Years regardless of changes in land use on the Parcel, except (i) in the event of a partial prepayment pursuant to Section H of the Amended Rate and Method, and (ii) pursuant to Section D of the Amended Rate and Method. Notwithstanding the foregoing, (i) if Bonds have yet to be issued, the Parcels can be assigned to the appropriate Special Tax Category, and the Administrator shall recalculate the Expected Maximum Facilities Special Tax Revenues based on the corresponding changes in revenues, and (ii) the actual Facilities Special Tax levied on the Parcel in any Fiscal Year may be less than the Maximum Facilities Special Tax if a lower Facilities Special Tax is calculated pursuant to Step 1 in Section E of the Amended Rate and Method, as described under “– Method of Levy of the Facilities Special Tax” below.

Final Map Property, Undeveloped Property, Taxable Owners Association Property, Taxable Public Property, and Taxable Welfare Exemption Property. Prior to the Transition Year, the Maximum Facilities Special Tax for Final Map Property, Undeveloped Property, Taxable Owners Association Property, Taxable Public Property, and Taxable Welfare Exemption Property is $65,213 per Acre for Fiscal Year 2025-26, which shall be increased on each July 1 by an amount equal to 2.0% of the amount in effect for the prior Fiscal Year.

In the Transition Year and each Fiscal Year thereafter, no Facilities Special Tax shall be levied on Final Map Property, Undeveloped Property, Taxable Owners Association Property, Taxable Public Property, or Taxable Welfare Exemption Property unless there are delinquent Facilities Special Taxes on a Parcel, in which case such delinquent Facilities Special Taxes can continue to be levied against the Parcel until they are collected.

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Changes to Maximum Facilities Special Tax.

1. Land Use Changes. The Expected Maximum Facilities Special Tax Revenues shown in Attachment 2 to the Amended Rate and Method were originally calculated based on the Expected Land Uses at the CFD Update. Attachment 2 to the Amended Rate and Method is subject to modification upon the occurrence of Land Use Changes, as described in the Amended Rate and Method. The Administrator shall review all Land Use Changes and compare the revised land uses to the Expected Land Uses to evaluate the impact on the Expected Maximum Facilities Special Tax Revenues. See APPENDIX B.

2. Increase in the Number of Affordable Housing Units. Attachment 2 to the Amended Rate and Method is subject to modification if there is an increase in the number of Affordable Housing Units expected within Improvement Area No. 1, as described in the Amended Rate and Method. See APPENDIX B. It should noted that no Affordable Housing Unit are currently planned for Improvement Area No. 1.

Method of Levy of the Facilities Special Tax. Each Fiscal Year, the Administrator shall determine the Facilities Special Tax Requirement and levy the Facilities Special Tax on all Parcels of Taxable Property as follows:

Step 1: The Facilities Special Tax shall be levied Proportionately on each Parcel of Developed Property up to 100% of the Maximum Facilities Special Tax for each Parcel of Developed Property for such Fiscal Year until the amount levied is equal to the Facilities Special Tax Requirement prior to applying any available Capitalized Interest.

Step 2: If additional revenue is needed after Step 1 and after applying Capitalized Interest to the Facilities Special Tax Requirement, the Facilities Special Tax shall be levied Proportionately on each Parcel of Final Map Property up to 100% of the Maximum Facilities Special Tax for each Parcel of Final Map Property for such Fiscal Year until the amount levied is equal to the Facilities Special Tax Requirement.

Step 3: If additional revenue is needed after Step 2, the Facilities Special Tax shall be levied Proportionately on each Parcel of Undeveloped Property up to 100% of the Maximum Facilities Special Tax for Undeveloped Property for such Fiscal Year until the amount levied is equal to the Facilities Special Tax Requirement.

Step 4: If additional revenue is needed after Step 3, the Facilities Special Tax shall be levied Proportionately on each Parcel of Taxable Welfare Exemption Property, up to 100% of the Maximum Facilities Special Tax for each Parcel of Taxable Welfare Exemption Property for such Fiscal Year until the amount levied is equal to the Facilities Special Tax Requirement.

Step 5: If additional revenue is needed after Step 4, the Facilities Special Tax shall be levied Proportionately on each Parcel of Taxable Owners Association Property, up to 100% of the Maximum Facilities Special Tax for each Parcel of Taxable Owners Association Property for such Fiscal Year until the amount levied is equal to the Facilities Special Tax Requirement.

Step 6: If additional revenue is needed after Step 5, the Facilities Special Tax shall be levied Proportionately on each Taxable Affordable Housing Unit, up to 100% of the Maximum Facilities Special Tax for each Taxable Affordable Housing Unit for Packet Page 244 of 530Attachment 3 Page 31 of 129

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such Fiscal Year until the amount levied is equal to the Facilities Special Tax Requirement.

Step 7: If additional revenue is needed after Step 6, the Facilities Special Tax shall be levied Proportionately on each Parcel of Taxable Public Property, up to 100% of the Maximum Facilities Special Tax for each Parcel of Taxable Public Property for such Fiscal Year until the amount levied is equal to the Facilities Special Tax Requirement.

Manner of Collection; Final Year of Levy. The Special Tax shall be collected in the same manner and at the same time as ordinary ad valorem property taxes, provided, however, that partial prepayments of the Facilities Special Tax are permitted as set forth in Section H of the Amended Rate and Method, and provided further that the City may directly bill the Special Tax, may collect the Special Tax at a different time or in a different manner, and may collect delinquent Special Taxes through foreclosure or other available methods.

The Facilities Special Tax shall be levied and collected through and including the earlier of (i) the Fiscal Year prior to the Transition Year or (ii) Fiscal Year 2073-74. Under no circumstances may the Facilities Special Tax on a Parcel in private residential use be increased in any Fiscal Year as a consequence of delinquency or default in payment of the Facilities Special Tax levied on another Parcel or Parcels 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.

Exemptions. Notwithstanding any other provision of the Amended Rate and Method, no Special Tax shall be levied on the following:

(i) Owners Association Property, Public Property, or Welfare Exemption Property except Taxable Owners Association Property, Taxable Public Property, and Taxable Welfare Exemption Property, as defined in the Amended Rate and Method;

(ii) Affordable Housing Units except Taxable Affordable Housing Units; and

(iii) Parcels that are: (a) designated as permanent open space or common space on which no structure is permitted to be constructed, (b) owned by a public utility for an unmanned facility, or (c) subject to an easement that precludes any other use on the Parcels. Notwithstanding the foregoing, if a Maximum Facilities Special Tax was assigned to a Parcel, and the entire Parcel meets the criteria in (a), (b) or (c) above, the Parcel shall remain subject to the levy of the Facilities Special Tax, unless the First Bond Sale has not occurred, or the Administrator determines that, if such Parcel becomes exempt from the Facilities Special Tax, the corresponding reduction in the Expected Maximum Facilities Special Tax Revenues would not reduce debt service coverage on outstanding Bonds below the Required Coverage. In either case, such property shall be categorized as Public Property, and the Administrator shall recalculate the Expected Maximum Facilities Special Tax Revenues to reflect the corresponding loss in revenues.

Prepayment of Facilities Special Tax. A property owner may prepay up to 75% of the Facilities Special Tax obligation applicable to a Parcel, provided that a prepayment may be made only if there are no delinquent Facilities Special Taxes with respect to such Parcel at the time of prepayment. An owner of a Parcel intending to prepay a portion of the Facilities Special Tax obligation shall provide the City with (i) written notice of intent to prepay, which shall identify the percentage of the Maximum Facilities Special Tax that is to be prepaid, (ii) payment of fees established by the City to process the prepayment request, and (iii) written evidence that there are no delinquent Facilities Special Taxes against the Parcel. Within 30 days of receipt of such Packet Page 245 of 530Attachment 3 Page 32 of 129

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written notice, the City or its designee shall notify such owner of the prepayment amount for such Parcel. Prepayment must be made not less than 50 days prior to any redemption date for Bonds to be redeemed with the proceeds of such prepaid Facilities Special Taxes. Under no circumstance shall a prepayment be allowed that would reduce debt service coverage below the Required Coverage.

The Prepayment Amount is calculated based on the Bond Redemption Amount plus Redemption Facilities Amount and other costs, all as specified in APPENDIX B.

Covenant to Foreclose

Sale of Property for Nonpayment of Taxes. The Fiscal Agent Agreement provides that Facilities Special Taxes shall be payable and be collected in the same manner and at the same time and in the same installment as the general taxes on real property are payable, and have the same priority, become delinquent at the same time and in the same proportionate amounts and bear the same proportionate penalties and interest after delinquency as do the ad valorem taxes on real property, except as provided in the special covenant for foreclosure described below, the Ordinance and in the Act. Under these procedures, if taxes are unpaid for a period of five years or more, the property is subject to sale by the County.

Foreclosure Under the Act. Under Section 53356.1 of the Act, if any delinquency occurs in the payment of the Facilities Special Tax, the City may order the institution of a Superior Court action to foreclose the lien therefor within specified time limits. In such an action, the real property subject to the unpaid amount may be sold at judicial foreclosure sale.

While judicial foreclosure is not mandatory under the Act, the City has covenanted in the Fiscal Agent Agreement that on or about March 30 and July 30 of each Fiscal Year, the Finance Director will:

(1) compare the amount of Facilities Special Taxes previously levied in Improvement Area No. 1 to the amount of Special Tax Revenues received by the City, and

(2) because it is the County’s practice under the Guidelines (as hereinafter defined) to apportion Facilities Special Taxes to the City as if the Facilities Special Taxes were covered by the Teeter Plan (as hereinafter defined) even though Facilities Special Taxes are not covered by the County’s Teeter Plan as further described below (see “ – Facilities Special Taxes Are Not Covered By Teeter Plan”), the City will make a good faith effort at the time of each apportionment of Facilities Special Taxes to obtain information from the County as to the Facilities Special Tax delinquencies represented by such apportionment.

Thereafter, if delinquencies have occurred, the City will proceed as follows:

Individual Parcel Delinquencies. If the Finance Director determines that any single parcel subject to the Facilities Special Tax in Improvement Area No. 1 is delinquent in the payment of four or more installments of Facilities Special Taxes, then the Finance Director will send or cause to be sent a notice of delinquency (and a demand for immediate payment thereof) to the property owner within 45 days of such determination, and (if the delinquency remains uncured) foreclosure proceedings will be commenced by the City within 90 days of such determination.

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Notwithstanding the foregoing, the City may defer any such actions with respect to a delinquent parcel if (1) the Facilities Special Taxes are covered by the County’s Teeter Plan, or an equivalent procedure, but only to the extent that the City cannot be required to repay the County for amounts apportioned by the County to the City that represent delinquent Facilities Special Taxes, (2) the amount in the 2024 Reserve Fund is at least equal to the 2024 Reserve Requirement, (3) the amount in the reserve account for any Parity Bonds that are not 2024-Related Parity Bonds is at least equal to the required amount and (4) the subject parcel is not delinquent with respect to more than $5,000 of Facilities Special Taxes.

Aggregate Delinquencies. If the Finance Director determines that (i) the total amount of delinquent Facilities Special Tax for the prior Fiscal Year for the entire Improvement Area No. 1 (including the total of delinquencies under the two paragraphs above), exceeds 5% of the total Facilities Special Tax due and payable for the prior Fiscal Year, or (ii) there are 10 or fewer owners of real property within Improvement Area No. 1, determined by reference to the latest available secured property tax roll of the County, the Finance Director shall notify or cause to be notified property owners who are then delinquent in the payment of Facilities Special Taxes (and demand immediate payment of the delinquency) within 45 days of such determination, and shall commence foreclosure proceedings within 90 days of such determination against each parcel of land in Improvement Area No. 1 with a Facilities Special Tax delinquency.

Individual Owner Delinquencies. As to any owner of more than one parcel within Improvement Area No. 1, if the Finance Director determines that the aggregate amount of delinquent Facilities Special Taxes for all preceding tax years on all parcels owned by such owner (whether such parcels are owned solely by such owner or jointly by such owner and one or more others) exceeds $5,000, then the Finance Director shall send or cause to be sent a notice of delinquency (and a demand for immediate payment thereof) to the property owner within 45 days of such determination, and (if the delinquency remains uncured) shall commence foreclosure proceedings within 90 days of such determination, regardless of when such delinquencies occurred.

Sufficiency of Foreclosure Sale Proceeds; Foreclosure Limitations and Delays. No assurances can be given that the real property subject to a judicial foreclosure sale will be sold or, if sold, that the proceeds of sale will be sufficient to pay any delinquent Facilities Special Tax installment. The Act does not require the City to purchase or otherwise acquire any lot or parcel of property foreclosed upon if there is no other purchaser at such sale.

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 is obtained. However, under Section 53356.5 of the Act, the City, as judgment creditor, is entitled to purchase any property sold at foreclosure using a “credit bid,” where the City could submit a bid crediting all or part of the amount required to satisfy the judgment for the delinquent amount of the Facilities Special Taxes. If the City becomes the purchaser under a credit bid, the City must pay the amount of its credit bid into the redemption fund established for the Bonds, but this payment may be made up to 24 months after the date of the foreclosure sale.

Foreclosure by court action is subject to normal litigation delays, the nature and extent of which are largely dependent on the nature of the defense, if any, put forth by the debtor and the Superior Court calendar. In addition, the ability of the City to foreclose the lien of delinquent unpaid Facilities Special Taxes may be limited in certain instances and may require prior consent Packet Page 247 of 530Attachment 3 Page 34 of 129

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of the property owner if the property is owned by or in receivership of the Federal Deposit Insurance Corporation (the “FDIC”). See “BOND OWNERS’ RISKS – Bankruptcy Delays.”

Facilities Special Taxes Are Not Covered By Teeter Plan. The County has adopted written guidelines for its Alternative Method of Tax Apportionment (“Teeter Plan”), as set forth in the “County of Solano Guideline - Solano County Teeter Program” dated March 25, 2004 (the “Guidelines”). Under the Guidelines, (i) Facilities Special Taxes are not covered by the County’s Teeter Plan, (ii) notwithstanding that Facilities Special Taxes are not covered by the County’s Teeter Plan, for administrative convenience, the County will apportion Facilities Special Taxes to the City as if the Facilities Special Taxes were covered by the Teeter Plan, and (iii) the County may demand the repayment by the City of apportionments that represent delinquent Facilities Special Taxes when the County determines that the collection of the delinquent Facilities Special Taxes is unlikely.

As a result, the City is permitted under the Fiscal Agent Agreement to use Facilities Special Taxes at any time to repay the County for amounts apportioned by the County to the City that represent delinquent Facilities Special Taxes if failure to do so will cause the County to withhold property tax revenues (other than Facilities Special Taxes) that would otherwise be apportioned to the City; provided, however, that in the event the County asks the City to repay the County for the apportionment of amounts that represent delinquent Facilities Special Taxes, the City will make a good faith effort to negotiate a payment plan with the County that will not require the City to repay the County with Facilities Special Taxes if doing so will result in there being insufficient Special Tax Revenues to pay debt service on the Bonds when due. Therefore, the District’s receipt of Facilities Special Taxes will be impacted by delinquencies in payment, as well as by the collection of interest and penalties on past delinquencies in the future.

See “THE DISTRICT AND IMPROVEMENT AREA NO. 1 – Potential Consequences of Facilities Special Tax Delinquencies” and “BOND OWNERS’ RISKS – Property Tax Delinquencies.”

Special Tax Fund

Deposits. Under the Fiscal Agent Agreement, the Special Tax Fund is established as a separate fund to be held by the Fiscal Agent, to the credit of which the Fiscal Agent will deposit amounts received from or on behalf of the City consisting of Special Tax Revenues and amounts transferred from the Administrative Expense Fund and the Bond Fund. The City will promptly remit any Special Tax Revenues received by it to the Fiscal Agent for deposit by the Fiscal Agent to the Special Tax Fund.

Notwithstanding the foregoing,

(i) Special Tax Revenues in an amount not to exceed the amount included in the Special Tax levy for such Fiscal Year for Administrative Expenses shall be separately identified by the Finance Director and shall be deposited by the Fiscal Agent in the Administrative Expense Fund;

(ii) any Special Tax Revenues constituting the collection of delinquencies in payment of Special Taxes shall be separately identified by the Finance Director and shall be disposed of by the Fiscal Agent first, for transfer to the Bond Fund to pay any past due Debt Service on the Bonds; second, without preference or priority, for transfer to the 2024 Reserve Fund to the extent needed to increase the amount then on deposit in the 2024 Reserve Fund up to the then 2024 Reserve Requirement and for transfer to the reserve account for any Parity Packet Page 248 of 530Attachment 3 Page 35 of 129

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Bonds that are not 2024-Related Parity Bonds to the extent needed to increase the amount then on deposit in such reserve account up to the amount then required to be deposited therein (and in the event the collection of delinquencies in payment of Facilities Special Taxes is not sufficient for the purposes of this clause, such amounts shall be applied to the 2024 Reserve Fund and any other reserve accounts ratably based on the then Outstanding principal amount of the Bonds); and third, to be held in the Special Tax Fund for use as described in “– Disbursements” below; and

(iii) any proceeds of Facilities Special Tax Prepayments will be separately identified by the Finance Director and will be deposited by the Fiscal Agent as follows (as directed in writing by the Finance Director): (a) that portion of any Facilities Special Tax Prepayment constituting a prepayment of construction costs (which otherwise could have been included in the proceeds of Parity Bonds) will be deposited by the Fiscal Agent to the Improvement Fund and (b) the remaining Facilities Special Tax Prepayment shall be deposited by the Fiscal Agent in the Special Tax Prepayments Account established pursuant to the Fiscal Agent Agreement.

Moneys in the Special Tax Fund will be held by the Fiscal Agent for the benefit of the City and Owners of the Bonds, will be disbursed as provided below and, pending disbursement, will be subject to a lien in favor of the Owners of the Bonds.

Disbursements. On the fifth Business Day prior to each Interest Payment Date, the Fiscal Agent will withdraw from the Special Tax Fund and transfer the following amounts in the following order of priority:

(i) to the Bond Fund an amount, taking into account any amounts then on deposit in the Bond Fund and any expected transfers from the Improvement Fund, the 2024 Reserve Fund and any reserve account for Parity Bonds that are not 2024-Related Parity Bonds, the 2024 Capitalized Interest Account and the Special Tax Prepayments Account to the Bond Fund such that the amount in the Bond Fund equals the principal (including any sinking payment), premium, if any, and interest due on the Bonds on such Interest Payment Date or redemption date and any past due principal or interest on the Bonds not theretofore paid from a transfer described in the Fiscal Agent Agreement, and

(ii) without preference or priority (a) to the 2024 Reserve Fund an amount, taking into account amounts then on deposit in the 2024 Reserve Fund, such that the amount in the 2024 Reserve Fund is equal to the 2024 Reserve Requirement, and (b) to the reserve account for any Parity Bonds that are not 2024-Related Parity Bonds, taking into account amounts then on deposit in the such reserve account, such that the amount in such reserve account is equal to the amount required to be on deposit therein (and in the event that amounts in the Special Tax Fund are not sufficient for the purposes of this paragraph, such amounts will be applied to the 2024 Reserve Fund and any other reserve accounts ratably based on the then Outstanding principal amount of the Bonds).

(iii) between each September 2, beginning on September 2, 2025, and the immediately succeeding December 31, the City may direct the Fiscal Agent to transfer any of the moneys remaining in the Special Tax Packet Page 249 of 530Attachment 3 Page 36 of 129

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Fund to (A) the Remainder Taxes Account or (B) the Administrative Expense Fund.

As described above, because it is the County’s practice under the Guidelines to apportion Facilities Special Taxes to the City as if the Facilities Special Taxes were covered by the Teeter Plan even though Facilities Special Taxes are not covered by the County’s Teeter Plan, the City may use Facilities Special Taxes at any time to repay the County for amounts apportioned by the County to the City that represent delinquent Facilities Special Taxes if failure to do so will cause the County to withhold property tax revenues (other than Facilities Special Taxes) that would otherwise be apportioned to the City. See “– Facilities Special Taxes Are Not Covered By Teeter Plan.”

Bond Fund

Deposits. The Fiscal Agent will hold the moneys in the Bond Fund for the benefit of the City and the Owners of the Bonds, and will disburse those funds for the payment of the principal of, and interest and any premium on, the Bonds as described below.

Capitalized Interest Account. Under the Fiscal Agent Agreement, within the Bond Fund there is established a separate account designated as the “Capitalized Interest Account” to be held in trust by the Fiscal Agent for the benefit of the City and the Owners of the 2024 Bonds into which a portion of the proceeds of the 2024 Bonds will be deposited on the Closing Date.

Amounts on deposit in the Capitalized Interest Account will be used and withdrawn by the Fiscal Agent solely for the payment of interest on the Bonds according to the following schedule:

(i) $____ on March 1, 2025, and

(ii) $____ on September 1 2025, and

(iii) any remaining amounts in the Capitalized Interest Account on March 1, 2026.

When the amount in the Capitalized Interest Account is fully expended for the payment of interest, the account will be closed.

Special Tax Prepayments Account. There is also created in the Bond Fund a separate account to be held by the Fiscal Agent, designated the “Special Tax Prepayments Account,” to the credit of which deposits will be made from Facilities Special Tax Prepayments as provided in the Fiscal Agent Agreement.

Disbursements. At least 10 Business Days before each Interest Payment Date, the Fiscal Agent will notify the Finance Director in writing as to the principal and premium, if any, and interest due on the Bonds on the next Interest Payment Date (whether as a result of scheduled principal of and interest on the Bonds, optional redemption of the Bonds or a mandatory sinking fund redemption). On each Interest Payment Date, the Fiscal Agent will withdraw from the Bond Fund and pay to the Owners of the Bonds the principal of, and interest and any premium, due and payable on such Interest Payment Date on the Bonds. Notwithstanding the foregoing, amounts in the Bond Fund as a result of a transfer pursuant to the Fiscal Agent Agreement will be immediately disbursed by the Fiscal Agent to pay past due amounts owing on the Bonds.

At least 5 Business Days prior to each Interest Payment Date, the Fiscal Agent will determine if the amounts then on deposit in the Bond Fund are sufficient to pay the Debt Service Packet Page 250 of 530Attachment 3 Page 37 of 129

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due on the Bonds on the next Interest Payment Date. In the event that amounts in the Bond Fund are insufficient for such purpose, the Fiscal Agent promptly will notify the Finance Director by telephone (and confirm in writing) of the amount of the insufficiency.

In the event that amounts in the Bond Fund are insufficient for the purpose set forth in the preceding paragraph with respect to any Interest Payment Date, the Fiscal Agent will do the following:

(i) Withdraw from the 2024 Reserve Fund, in accordance with the provisions of the Fiscal Agent Agreement, to the extent of any funds or Permitted Investments therein, amounts to cover the amount of such Bond Fund insufficiency related to the 2024 Bonds and any other 2024-Related Parity Bonds. Amounts so withdrawn from the 2024 Reserve Fund will be deposited in the Bond Fund.

(ii) Withdraw from the reserve funds, if any, established under a Supplemental Agreement related to Parity Bonds that are not 2024-Related Parity Bonds, to the extent of any funds or Permitted Investments therein, amounts to cover the amount of such Bond Fund insufficiency related to such Parity Bonds. Amounts so withdrawn from any such reserve fund will be deposited in the Bond Fund.

If, after the foregoing transfers and application of such funds for their intended purposes, there are insufficient funds in the Bond Fund to make the payments provided for in the second sentence of the first paragraph under “Bond Fund – Disbursements” above, the Fiscal Agent will apply the available funds first to the payment of interest on the Bonds, then to the payment of principal due on the Bonds other than by reason of sinking payments, if any, and then to payment of principal due on the bonds by reason of sinking payments. Each such payment will be made ratably to the Owners of the Bonds based on the then Outstanding principal amount of the Bonds, if there are insufficient funds to make the corresponding payment for all of the then Outstanding Bonds, subject to the restrictions on the uses of any funds as set forth in the Fiscal Agent Agreement. Any sinking payment not made as scheduled will be added to the sinking payment to be made on the next sinking payment date. Any failure by the Fiscal Agent to provide the notices required by the Fiscal Agent Agreement will not alter the obligation of the City to make the scheduled payments from amounts in the Bond Fund.

Disbursements from the Special Tax Prepayments Account. Moneys in the Special Tax Prepayments Account will be transferred by the Fiscal Agent to the Bond Fund on the next date for which notice of redemption of Bonds can timely be given under the Fiscal Agent Agreement, and notice to the Fiscal Agent can timely be given under the Fiscal Agent Agreement, and will be used (together with any amounts transferred pursuant to the Fiscal Agent Agreement) to redeem Bonds on the redemption date selected in accordance the Fiscal Agent Agreement.

2024 Reserve Fund

General. In order to further secure the payment of principal of and interest on the 2024 Bonds and any other 2024-Related Parity Bonds issued in the future, a portion of the proceeds of the 2024 Bonds will be deposited into the 2024 Reserve Fund in an amount equal to the “2024 Reserve Requirement” (as defined below). See “FINANCING PLAN – Estimated Sources and Uses of Funds.”

2024 Reserve Requirement. The “2024 Reserve Requirement” is defined in the Fiscal Agent Agreement as the amount as of any date of calculation equal to the least of (a) Maximum Annual Debt Service on the 2024A Bonds and 2024-Related Parity Bonds, if any, (b) 125% of average Annual Debt Service on the 2024A Bonds and 2024-Related Parity Bonds, if any and (c) Packet Page 251 of 530Attachment 3 Page 38 of 129

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10% of the outstanding principal of the 2024A Bonds and 2024-Related Parity Bonds, if any; provided, however:

(A) that with respect to the calculation of clause (c), the issue price of the 2024 Bonds or any 2024-Related Parity Bonds excluding accrued interest will be used rather than the outstanding principal amount, if (i) the net original issue discount or premium of the 2024 Bonds or any 2024-Related Parity Bonds was less than 98% or more than 102% of the original principal amount of the 2024 Bonds or any 2024-Related Parity Bonds and (ii) using the issue price would produce a lower result than using the outstanding principal amount;

(B) that in no event shall the amount calculated exceed the amount on deposit in the 2024 Reserve Fund on the date of issuance of the most recently issued series of 2024-Related Parity Bonds (if any 2024-Related Parity Bonds are covered by the 2024 Reserve Fund) except in connection with any increase associated with the issuance of 2024-Related Parity Bonds; and

(C) that in no event will the amount required to be deposited into the 2024 Reserve Fund in connection with the issuance of a series of 2024-Related Parity Bonds exceed the maximum amount under the Tax Code that can be financed with tax-exempt bonds and invested an unrestricted yield.

Use of 2024 Reserve Fund. Except as otherwise provided in the Fiscal Agent Agreement, all amounts deposited in the 2024 Reserve Fund will be used and withdrawn by the Fiscal Agent solely for the purpose of making transfers to the Bond Fund in the event of any deficiency at any time in the Bond Fund of the amount then required for payment of the principal of, and interest and any premium on, the 2024 Bonds and any other 2024-Related Parity Bonds or, in accordance with the provisions of the Fiscal Agent Agreement, for the purpose of redeeming the 2024 Bonds and any other 2024-Related Parity Bonds from the Bond Fund. Whenever a transfer is made from the 2024 Reserve Fund to the Bond Fund due to a deficiency in the Bond Fund for payment of the principal of, and interest and any premium on, the 2024 Bonds and any 2024-Related Parity Bonds, the Fiscal Agent will provide written notice thereof to the Finance Director, specifying the amount withdrawn.

Qualified Reserve Fund Credit Instruments. The City has the right at any time to direct the Fiscal Agent to release funds from the 2024 Reserve Fund, in whole or in part, by tendering to the Fiscal Agent: (i) a Qualified Reserve Account Credit Instrument (as defined in the Fiscal Agent Agreement), and (ii) an opinion of Bond Counsel stating that neither the release of such funds nor the acceptance of such Qualified Reserve Account Credit Instrument will cause interest on the 2024 Bonds or any other 2024-Related Parity Bonds the interest on which is excluded from gross income of the owners thereof for federal income tax purposes to become includable in gross income for purposes of federal income taxation.

The City will have no obligation to replace a Qualified Reserve Account Credit Instrument or to fund the 2024 Reserve Fund with cash if, at any time that the 2024 Bonds or any other 2024- Related Parity Bonds are Outstanding, amounts are not available to be drawn upon under the Qualified Reserve Account Credit Instrument. The City and the Fiscal Agent will comply with the terms of the Qualified Reserve Account Credit Instrument as will be required to receive payments thereunder in the event and to the extent required under the Fiscal Agent Agreement.

See “APPENDIX C – SUMMARY OF CERTAIN PROVISIONS OF THE FISCAL AGENT AGREEMENT” for a complete description of the timing, purpose and manner of disbursements from the 2024 Reserve Fund.

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Investment of Moneys in Funds

Moneys in any fund or account created or established by the Fiscal Agent Agreement and held by the Fiscal Agent will be invested by the Fiscal Agent in Permitted Investments, which in any event by their terms mature prior to the date on which such moneys are required to be paid out under the Fiscal Agent Agreement. See APPENDIX C.

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THE DISTRICT AND IMPROVEMENT AREA NO. 1

Formation and Background

Formation. The District was established by the City Council under the Act, following a noticed public hearing, pursuant to Resolution No. 2023-31 (the “Resolution of Formation”) on February 21, 2023. On the same date, an election was held in which the qualified electors within Improvement Area No. 1 approved a ballot proposition authorizing the City to incur bonded indebtedness for Improvement Area No. 1 of the District of up to $90,000,000 (as subsequently increased to $100,000,000 pursuant to the change proceedings described below) to finance the acquisition and construction of the authorized Facilities, to levy the Special Taxes, and to establish an appropriations limit for Improvement Area No. 1 of the District.

The Master Developer originally intended to annex Planning Area 5 into CFD No. 2019-1, but due to changing market conditions and changes to the Development Agreement (as defined herein), the Master Developer asked the City to form the District and the Future Annexation Area (defined below) over the Planning Area 5 property. The District is intended to continue the financing of the facilities and services for the One Lake Project as a whole.

The District is authorized to finance the construction of authorized Facilities. See “FINANCING PLAN – Facilities Financing Plan.”

The Amended Rate and Method by which Special Taxes may be levied is attached APPENDIX B. See “SECURITY FOR THE 2024 BONDS – Amended Rate and Method” for a summary of the Amended Rate and Method.

Future Annexation Area. The District was formed to include Improvement Area No. 1 and “City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5) (Future Annexation Area)” (the “Future Annexation Area”). The Future Annexation Area enables properties to annex into the District with fewer procedural requirements than would otherwise be required under the Act. Property owners in the Future Annexation Area annex into the District by executing a unanimous approval. Under the Act, a unanimous approval constitutes the vote of a qualified elector in favor of the matters addressed in the unanimous approval for purposes of the California Constitution.

Property within the Future Annexation Area may be annexed into the District as improvement areas to be designated in the future separate and apart from Improvement Area No. 1 (such future improvement areas, the “Future Improvement Areas”), or into Improvement Area No. 1. For Future Improvement Areas, a different rate and method may be adopted if the annexed territory is designated as a separate improvement area. No supplements to the Amended Rate and Method in connection with the annexation of territory to Improvement Area No. 1 (if any), and no new rate and method for any Future Improvement Area, may cause an increase in the maximum Special Tax rate in the territory that was in the District prior to the annexation (including Improvement Area No. 1).

The property in the Future Annexation Area consists of Neighborhood P and Neighborhood Q, and is currently designated for development as 172 attached multifamily units.

No assurance can be given as to whether this will be annexed into the District or Improvement Area No. 1 in the future.

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The 2024 Bonds are currently secured only by the Facilities Special Taxes levied within Improvement Area No. 1 . The property in the Future Annexation Area is not currently subject to the lien of the Facilities Special Tax and will not be subject to the Facilities Special Tax unless such property is annexed to Improvement Area No. 1 in the future.

Change Proceedings. On October 15, 2024, the City completed change proceedings for Improvement Area No. 1 in order to (i) amend the Original Rate and Method and adopt the Amended Rate and Method to increase the rate of the Special Taxes, (ii) increase the bonded indebtedness limit for Improvement Area No. 1 from $90,000,000 to $100,000,000, and (iii) increase the bonded indebtedness limit for the remaining property in the District from $15,000,000 to $20,000,000.

Description and Location

One Lake Project. The property in Improvement Area No. 1 is part of the larger One Lake Project, a 358.5-acre master-planned community being developed by the Master Developer.

The One Lake Project is located in the northeastern area of the City along the north side of Vanden Road at One Lake Drive. Improvement Area No. 1 is the most eastern portion of the One Lake Project. The Master Developer anticipates that the One Lake Project will be developed in numerous phases that will ultimately consist of 1,937 single-family and multi-family homes and a 190-unit apartment complex, with approximately 20,000 square feet of commercial/retail space.

The One Lake Project comprises the property known as Planning Area 4 and Planning Area 5 of the Specific Plan.

Improvement Area No. 1 comprises the majority of Planning Area 5. Planning Area 4 is within CFD No. 2019-1, a separate community facilities district previously formed by the City, and not subject to the Facilities Special Tax securing the 2024 Bonds.

Improvement Area No. 1. The property within Improvement Area No. 1 is anticipated to be improved with 932 residential units, 12.77 acres of public parks, and public street improvements. The residential units are anticipated to consist of 816 single-family detached homes, and 116 single-family detached courtyard cluster homes. As of August 28, 2024, the date of value of the Appraisal, the property in Improvement Area No. 1 consisted of 131 finished lots, 40 substantially finished lots and 761 rough-graded lots.

See “PROPERTY OWNERSHIP AND DEVELOPMENT STATUS” for additional information regarding the property ownership and development status within Improvement Area No. 1, the One Lake Project, and the Specific Plan.

Boundary Map. The boundary map showing the boundaries of Improvement Area No. 1 is attached as Appendix I.

See “APPENDIX A – GENERAL INFORMATION ABOUT THE CITY OF FAIRFIELD AND SOLANO COUNTY” for demographic and other information regarding the area in and around the District.

Authorized Facilities

General. Under the Resolution of Formation, the District (and each improvement area therein) is authorized to finance all or a portion of the costs of acquisition, construction and improvement of facilities permitted under the Act and that are required as conditions of development of property in the One Lake Project. The facilities authorized to be financed (the “Facilities”) include, among others, the following:

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• Offsite sewer improvements.

• Offsite potable water improvements and facilities, including but not limited to pump stations, buildings, water lines, and storage facilities.

• Offsite non-potable water improvements and facilities, including but not limited to pump stations, water lines, and street work.

• Storm drain/non-potable water pump station improvements, buildings, and facilities.

• Backbone street and road improvements and facilities, including sewer, water, storm drain, street lights signage and striping, traffic signals, medians, curb, gutter, City fiber lines, pavement and bridges.

• ln-tract Improvements including sewer, water, storm drain, street lights signage and striping, curb, gutter, and pavement.

• Storm drain basins, bio-retention and storm drain improvements to meet storm management needs, including maintenance roads, fencing and other improvements.

• Fire station that will serve property in the One Lake Project, including land, building, and associated site improvements.

The Facilities may be located within or outside the District.

Status of Construction of Facilities. For the current status of the construction of Facilities in Improvement Area No. 1, see “PROPERTY OWNERSHIP AND DEVELOPMENT STATUS – Public Improvements Required for the One Lake Project.”

Acquisition Agreement. In connection with the formation of the District, the Master Developer and the City entered into the Acquisition Agreement dated as of February 21, 2023 (the “Acquisition Agreement”). The Acquisition Agreement authorized the financing of the Facilities with the proceeds of the Bonds, prepayments of Facilities Special Taxes collected prior to the issuance of the Bonds, prepayments of Facilities Special Taxes otherwise allocated for Facilities under the Amended Rate and Method, and Facilities Special Taxes collected to directly finance Facilities under the Amended Rate and Method and which are allocated to fund such Facilities. The Master Developer will remain responsible for any Facilities costs not funded from these sources.

Under the Fourth Amendment to the Development Agreement, the Master Developer and the City agreed to fund the purchase of a new fire station site and construction of Fire Station 39, which will service the entire Specific Plan area, from bond proceeds. The total site acquisition and construction cost are not to exceed $12.5 million. The purchase of the Fire Station 39 site, $1.2 million, was funded with the proceeds of the CFD No. 2019-1 bonds. The remaining cost to construct Fire Station 39, $11.3 million, are anticipated to be funded from the proceeds of the 2024 Bonds.

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Special Tax Revenues and Projected Debt Service Coverage

The Amended Rate and Method is structured to produce Special Tax revenues from the Maximum Facilities Special Taxes Special Tax that, when applied to the projected debt service on the 2024 Bonds, is anticipated to result in a debt service coverage ratio of at least 110% for the life of the 2024 Bonds.

The following table shows the Target Facilities Special Tax and the expected Maximum Facilities Special Taxes based on expected land uses at buildout.

Table 1
Expected Land Uses and Expected Maximum Special Tax Revenues at Buildout FY 2025-26 Maximum Target Facilities Expected Facilities Special Tax Before Residential Special Tax Special Tax Category Transition Year Units(1) at Buildout Single Family Detached Property

Greater than or Equal to 3,000 Square
Feet
$5,850 per unit 170 $994,527
2,800 - 2,999 Square Feet 5,344 per unit 226 1,207,631 2,600 - 2,799 Square Feet 4,909 per unit 0 0 2,400 - 2,599 Square Feet 4,656 per unit 116 540,073 2,200 - 2,399 Square Feet 4,475 per unit 286 1,279,781 Less than 2,200 Square Feet 4,149 per unit 134 555,982 Subtotal 932 4,577,994 Single Family Attached Property
Greater than or Equal to 1,800 Square
Feet
4,095 per unit 0 0
Less than 1,800 Square Feet 3,914 per unit 0 0 Subtotal 0 0 Multi-Family Property 65,213 per acre 0 0
Total 932 $4,577,994

(1) Based on the expected residential units within each Special Tax category as of May 3, 2024, per the Master Developer.

Source: Goodwin Consulting Group, Inc.

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Assessed Values

General. The valuation of real property in the County is established by the County Assessor. Assessed valuations are reported at 100% of the “full cash value” of the property, which is defined in Article XIIIA of the California Constitution as the appraised value as of March 1, 1975, plus adjustments not to exceed 2% per year to reflect inflation. An assessment of “full cash value” is required upon change of ownership or new construction, after which the assessed value increases at a rate no greater than 2% per year. Accordingly, the gross assessed valuation presented in this Official Statement may not necessarily be representative of the actual market value of certain property in Improvement Area No. 1.

Assessed Valuation. For Fiscal Year 2024-25, the property in Improvement Area No. 1 had a total assessed value of $_____________ as of the lien date of January 1, 2024.

Appraised Values

General. The purpose of the Appraisal was to estimate the fee simple market value of the taxable property within Improvement Area No. 1, subject to the Facilities Special Taxes levy, by ownership, with the sum of values by ownership representing an aggregate value.

The Appraisal was prepared in compliance with Uniform Standards of Professional Appraisal Practice (USPAP), the Code of Ethics of the Appraisal Institute, and the Appraisal Standards for Land Secured Financing as promulgated by the California Debt and Investment Advisory Commission.

Assumptions and Limiting Conditions. In addition to the conditions described above, the value conclusions contained in the Appraisal are subject to the following assumptions and limiting conditions.

• The Appraiser relied on land development cost and fees provided by the Master Developer and Lennar. The budgeted site costs and fees appear reasonable relative to costs at other projects in the area (and costs of comparables analyzed). It is an extraordinary assumption of the Appraisal that the said costs and fees are reasonably true and correct. Any substantial changes in costs and fees could have an effect on the value conclusions and the feasibility of development. The Appraiser assumed that competent and professional engineering has been completed and that the cost estimates were prepared by a qualified, professional service.

• As of the date of value of the Appraisal, the 2024 Bonds had not been sold. The values estimated in the Appraisal are based on the hypothetical condition that, as of the date of inspection, the 2024 Bonds had just been sold and the property was encumbered by Facilities Special Taxes, as described therein. The value accounts for the impact of the lien of the Facilities Special Tax securing the 2024 Bonds.

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Value Estimates. The Appraiser estimated that, as of the August 28, 2024, date of value, the estimated market value of the taxable property in Improvement Area No. 1 was as follows:

Property Owner Neighborhood Number of Lots Estimated Value Master Developer L 20 $3,330,000
K 20 $3,330,000
Remainder 761 $78,340,000
Subtotal 801 $85,000,000

Lennar Homes R 65 $12,111,165
O 66 $13,188,835
Subtotal 131 $25,300,000

Totals: 932 $110,300,000

Valuation Methods. The Appraisal used the sales comparison and an extraction method.

The sales comparison approach considers area bulk lot sales, with adjustments applied accordingly relative to the subject. The extraction method arrives at lot values by deducting home construction costs from the finished home values. The home prices used in this approach were derived from the home sales and offering prices in Improvement Area No. 1. The conclusions from these approaches were then reconciled into final lot values.

Neither the City nor the Underwriter makes any representation as to the accuracy or completeness of the Appraisal. See APPENDIX H for a complete copy of the Appraisal Report, including a description of the valuation process that the Appraiser undertook to arrive at an estimate of value of the appraised property within Improvement Area No. 1.

Appraised Value-to-Debt Ratios

The table below shows the Fiscal Year 2025-26 maximum Facilities Special Tax revenues and value-to-lien ratio for the taxable parcels in Improvement Area No. 1 allocated by property ownership and development status, based on the appraised values set forth in the Appraisal, and the principal amount of the 2024 Bonds.

No assurance can be given that the amounts shown in these tables will conform to those ultimately realized in the event of a foreclosure action following delinquency in the payment of the Facilities Special Taxes.

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-39- The table below shows the approximate value-to-debt ratios for the property in Improvement Area No. 1 allocated by value-to-lien categories, based on the appraised values set forth in the Appraisal and the principal amount of the 2024 Bonds. Table 3 Appraised Values and Value-to-Debt Ratios Allocated by Value-to-Debt Category Value-to-Lien Category Expected Residential Units Appraised Value Projected FY 2025-26 Facilities Special Tax Levy (1) Projected FY 2025-26 Maximum Facilities Special Tax Revenues (2) Percent of FY 2025-26 Maximum Facilities Special Tax Revenues Allocated Bond Debt(3)* Average Value-to-Lien* Greater than 5:1 175 $32,299,042 $1,216,924 $1,216,924 13.5% $4,912,870 6.57 3:1 to 5:1 65 $6,764,060 $70,910 $487,671 5.4% $1,968,789 3.44 2:1 to 3:1 622 $64,030,854 $680,341 $6,280,043 69.5% $25,353,300 2.53 Less than 2:1 70 $7,206,045 $114,450 $1,056,456 11.7% $4,265,041 1.69 Totals 932 $110,300,000 $2,082,625 $9,041,094 100.0% $36,500,000 3.02 * Preliminary; subject to change. (1) Based on development status as of the August 28, 2024, date of value of the Appraisal. The projected Fiscal Year 2025-26 Facilities Special Tax levy is subject to change if additional building permits are issued or final maps are recorded before June 30, 2025. (2) Based on the current status of development and estimated taxable acreage in Improvement Area No. 1. At buildout the maximum Facilities Special Tax revenues are expected to generate $4,577,944 in Fiscal Year 2025-26. (3) Allocated based on the Fiscal Year 2025-26 maximum Facilities Special Tax revenues. Source: Goodwin Consulting Group, Inc.; the Appraiser. Packet Page 261 of 530Attachment 3 Page 48 of 129

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Direct and Overlapping Governmental Obligations

Contained within the boundaries of Improvement Area No. 1 are certain overlapping local agencies providing public services. Many of these local agencies have outstanding debt. The direct and overlapping debt affecting Improvement Area No. 1 as of ______________, 2024, is shown in the table below, a direct and overlapping debt report (the “Debt Report”) prepared by California Municipal Statistics, Inc. The Debt Report is included for general information purposes only. Neither the City nor the Underwriter has reviewed the Debt Report for completeness or accuracy and neither makes any representation in connection therewith.

The Debt Report generally includes long-term obligations sold in the public credit markets by public agencies whose boundaries overlap the boundaries of Improvement Area No. 1 in whole or in part. These long-term obligations are not payable from Facilities Special Taxes derived from Improvement Area No. 1 (except as indicated) nor are they necessarily obligations secured by land within Improvement Area No. 1. In many cases long-term obligations issued by a public agency are payable only from the general fund or other revenues of such public agency. The contents of the Debt Report are as follows: (1) the first column indicates the public agencies that have outstanding debt as of the date of the Debt Report and whose territory overlaps Improvement Area No. 1; (2) the second column shows the percentage of the assessed valuation of the overlapping public agency identified in column 1 which is represented by property located within Improvement Area No. 1; and (3) the third column is an apportionment of the dollar amount of each public agency's outstanding debt (which amount is not shown in the table) to property in Improvement Area No. 1, as determined by multiplying the total outstanding debt of each agency by the percentage of the public agency's assessed valuation represented in column 2.

Table 4
Direct and Overlapping Governmental Obligations
2024-25 Local Secured Assessed Valuation:

DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT: % Applicable Debt __/1/224
Solano Community College District General Obligation Bonds City of Fairfield Zone of Benefit Obligations(2)
City of Fairfield Community Facilities District No. 2023-1, IA 1 100.000 TOTAL DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT $

Ratios to 2024-25 Local Secured Assessed Valuation:

Total Direct and Overlapping Tax and Assessment Debt .................. ___%

(1) Excludes the 2024 Bonds.
(2) Represents the City’s obligations to allocate property tax revenues levied within Improvement Area No. 1 to pay the Solano County Water Agency for project costs associated with the North Bay Aqueduct of the State Water Project.

Source: California Municipal Statistics, Inc.

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Estimated Tax Burden on Single-Family Homes

The following table sets forth the estimated and projected total tax burden on certain representative categories of developed single- detached units in Improvement Area No. 1.

Table 5
Fiscal Year 2024-25 Illustrative Tax Bill
(Developed Single-Family Detached Units)

SFD SFD SFD SFD
Assumptions < 2,200 SF
2,400 –
2,599 SF
2,600 –
2,799 SF ≥ 3,000 SF
Estimated Base Price (1) $686,195 $753,321 $851,954 $900,000 Homeowner's Exemption ($7,000) ($7,000) ($7,000) ($7,000) Net Expected Assessed Value $679,195 $746,321 $844,954 $893,000 Ad Valorem Tax Rate (2) Rate Base Property Tax 1.000000% $6,792 $7,463 $8,450 $8,930 Fairfield City 0.002300% $16 $17 $19 $21
SCC 2012 GOB Series F 0.001232% $8 $9 $10 $11
SCC 2012 GOB Series C 0.000116% $1 $1 $1 $1
SCC GOB 2015 Series A 0.001165% $8 $9 $10 $10
SCC 2015 GO Refunding Bonds 0.013899% $94 $104 $117 $124 SCC 2019 GO Refunding Bonds 0.005225% $35 $39 $44 $47 Solano Community Col Bonds 2021 0.006830% $46 $51 $58 $61 SCC 2012 GOB Series E 0.003598% $24 $27 $30 $32
SCC 2012 GOB Series D 0.000631% $4 $5 $5 $6
SC Water Agency ST Water Project 0.020000% $136 $149 $169 $179 Total Ad Valorem Taxes 1.054996% $7,165 $7,874 $8,914 $9,421 Direct Charges (3)
CFD No. 2023-2 TSSP – Services(4) $2,175 $2,175 $2,175 $2,175 F-S SD Drainage Maintenance $20 $20 $20 $20
SF Bay Rest Auth-Measure Aa $12 $12 $12 $12
CFD No. 2023-1 IA 1 - Facilities (4) (5) $4,068 $4,565 $4,812 $5,735 Total Direct Charges $6,275 $6,772 $7,020 $7,943

Total Taxes and Direct Charges $13,441 $14,646 $15,934 $17,364 Percentage of Estimated Base Price 1.96% 1.94% 1.87% 1.93%

(1) Represents the average base prices included in the Appraisal. (2) Based on the Fiscal Year 2023-24 ad valorem tax rates for the tax rate area within Improvement Area No. 1. Ad valorem tax rates are subject to change in future years.
(3) Based on the Fiscal Year 2023-24 charges identified on the Solano County-issued property tax bills. Charges subject to change in future years.
(4) Represents the Fiscal Year 2024-25 maximum special tax rates. (5) Represents the Facilities Special Taxes securing the 2024 Bonds.

Source: Solano County Tax Collector’s Office; Goodwin Consulting Group, Inc.; the Appraiser.

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No History of Facilities Special Tax Collection and Delinquencies

The Facilities Special Tax will first be levied in Fiscal Year 2025-26; therefore, no history of levies, collections and delinquencies is available.

Potential Consequences of Facilities Special Tax Delinquencies

General. Delinquencies in the payment of property taxes (including the Facilities Special Taxes) with respect to property in Improvement Area No. 1 could result in draws on the 2024 Reserve Fund, and perhaps, ultimately, a default in the payment on the 2024 Bonds and any other 2024-Related Parity Bonds. See “SECURITY FOR THE 2024 BONDS – Covenant to Foreclose – Facilities Special Taxes Are Not Covered By Teeter Plan” and “BOND OWNERS’ RISKS.”

As of April 22, 2024, the Master Developer reported that it had not been delinquent in the payment of special taxes with respect the CFD No. 2019-1 levied within Planning Area 4.

Facilities Special Tax Enforcement and Collection Procedures. The City could receive additional funds for the payment of Debt Service through foreclosure sales of delinquent property, but no assurance can be given as to the amount of foreclosure sale proceeds or when foreclosure sale proceeds would be received. The City has covenanted in the Fiscal Agent Agreement to take certain enforcement actions and commence and pursue foreclosure proceedings against delinquent parcels under the terms and conditions described herein. See “SECURITY FOR THE 2024 BONDS — Covenant to Foreclose” and “BOND OWNERS’ RISKS.”

Foreclosure actions would include, among other steps, formal City Council action to authorize commencement of foreclosure proceedings, mailing multiple demand letters to the record owners of the delinquent parcels advising them of the consequences of failing to pay the applicable Facilities Special Taxes and contacting secured lenders to obtain payment. If these efforts were unsuccessful, they would be followed (as needed) by the filing of an action to foreclose in superior court against each parcel that remained delinquent.

Limitations on Increases in Facilities Special Tax Levy. If owners are delinquent in the payment of Facilities Special Taxes, the City may not increase Facilities Special Tax levies to make up for delinquencies for prior Fiscal Years above the Maximum Facilities Special Tax rates specified for each category of property within Improvement Area No. 1. See “SECURITY FOR THE 2024 BONDS – Amended Rate and Method.” In addition, Section 53321(d) of the Act provides that the special tax levied against any parcel for which an occupancy permit for private residential use has been issued may not be increased as a consequence of delinquency or default by the owner of any other parcel within a community facilities district by more than 10% above the amount that would have been levied in such Fiscal Year had there never been any such delinquencies or defaults. In cases of significant delinquency, these factors may result in defaults in the payment of principal of and interest on the 2024 Bonds. See “BOND OWNERS’ RISKS.”

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PROPERTY OWNERSHIP AND DEVELOPMENT STATUS

The information provided in this section has been included because it may be considered relevant to an informed evaluation and analysis of the 2024 Bonds and Improvement Area No. 1.

No assurance can be given, however, that the proposed development of the property within the One Lake Project and Improvement Area No. 1 will occur in a timely manner or in the configuration or to the density described herein, or that the Master Developer, Lennar Homes, any other merchant builder, any owners or affiliates thereof, or any other property owner described herein will or will not retain ownership of its respective property within the One Lake Project or Improvement Area No. 1. Neither the 2024 Bonds nor any of the Facilities Special Taxes are personal obligations of any property owner within Improvement Area No. 1. The 2024 Bonds are secured solely by the Facilities Special Taxes levied on property within Improvement Area No. 1 and amounts on deposit in certain of the funds and accounts maintained by the Fiscal Agent under the Fiscal Agent Agreement as described in this Official Statement. Neither the City nor the Underwriter can provide any assurances as to the accuracy of the information in this section.

The One Lake Project

General. The property in Improvement Area No. 1 is part of a 358.5-acre master-planned community known as “One Lake” (the “One Lake Project”) being developed by One Lake Holding LLC, a Delaware limited liability company (the “Master Developer”). The One Lake Project comprises the property known as Planning Area 4 and Planning Area 5 of the Fairfield Train Station Specific Plan, adopted by the City Council on July 26, 2011, as amended (“Specific Plan”). Although the One Lake Project is divided into two separate planning areas, the combined areas are being developed as one project, and are integrated through road networks, bicycle/pedestrian trails, and various private and public recreational spaces.

The Master Developer is developing the One Lake Project in two major phases: Planning Area 4 and Planning Area 5, which are further discussed below and that will ultimately consist of 1,937 single-family and multi-family homes, a 190-unit apartment complex, and approximately 20,000 square feet of commercial/retail space. The Master Developer is not a homebuilder and intends to carry out all land development activities through the sale of finished lots to merchant builders.

Planning Area 4 is within CFD No. 2019-1, a separate community facilities district previously formed by the City, and not subject to the Facilities Special Tax securing the 2024 Bonds.

Improvement Area No. 1 comprises all of Planning Area 5 other than Neighborhoods P and Q (which are identified as Future Annexation Area for the District).

Planning Areas. The two Planning Areas within the One Lake Project are further described below:

Planning Area 4. The first development phase of the One Lake Project was Planning Area 4. The development of Planning Area 4 commenced in the summer of 2018.

As described further herein, Planning Area 4, which is now nearly fully developed, will eventually consist of 833 housing units. Planning Area 4 was developed in four phases of single-family detached and attached lots. Phase 1A (187 single-family lots), phase 1B (151 single-family lots and 48 attached product lots), and phase 1C (121 single-family lots, 60 attached product lots, and a 3.8-acre public park) have been fully developed and sold to merchant builders. The horizontal improvements for Neighborhood 8 (56 single-family Packet Page 265 of 530Attachment 3 Page 52 of 129

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lots) of phase 1D are complete and the property was sold to a merchant builder.

Neighborhood 9 of phase 1D may be developed for up to 200 3-story townhomes on 21.7 acres, depending on the market and costs. As of August 10, 2024, within Planning Area 4, approximately 595 building permits have been issued, and the merchant builders are reporting 468 escrow closings. In addition to aforementioned housing developments, a 5- acre site was sold to an affordable housing developer who constructed a 190-unit apartment complex, which is now fully rented. The 190-unit apartment complex is not part of CFD No. 2019-1.

Planning Area 5. Planning Area 5 consist of the property in Improvement Area No. 1 and Neighborhoods P and Q, which are currently zoned for multi-family housing units, and located within the Future Annexation Area of the District. Planning Area 5 will ultimately consist of the following: (A) within Improvement Area No. 1, 10 low-density residential neighborhoods (816 units) and 6 medium density residential neighborhoods (116 units); and (B) within the Future Annexation Area, 172 multi-family units. With the exception Neighborhoods P and Q, the Master Developer has secured Tentative Map approval for the balance of Planning Area 5. See the information in this Official Statement for more details on the planned development of Improvement Area No. 1.

Amenities. The core feature of the One Lake Project is a 10-acre lake (the “Lake”), surrounded by an 11-acre public park (the “Lake Park”). In walking the one-mile pathway that rims the lake, the park provides a series of unique experiences in a collection of nine distinct park settings. Inside the main entrance into the One Lake Project is the iconic Glass House, a 700 square foot building and covered patio that serves as the visitor center and a coffee shop (Journey Coffee). The 1.5-acre community garden - called The Grove - sits directly across the street from the Glass House, and the proposed community clubhouse (the “Clubhouse”), which sits at the mid-point of the Lake Park and overlooks the Lake, is currently under construction. The 7,700 square foot building and pool house are expected to be completed by mid-summer 2025. In addition to Lake Park, there is a 2.5-acre park, known as the Lake Trail Park, which is fully equipped with recreational equipment, and provides a pathway from the pedestrian trail that rims the Lake to the Lake Park. A 1.5-acre sports park and 3,500 square foot “sports complex” will be constructed in the later development stages of Improvement Area No. 1.

Only the property in Improvement Area No. 1 (which is Planning Area 5 less Neighborhoods P and Q) is subject to the Facilities Special Tax that secures payment on the 2024 Bonds. The remainder of the One Lake Project located in Planning Area 4 and Neighborhoods P and Q of Planning Area 5 are not subject to the lien of the Facilities Special Tax securing the 2024 Bonds.

One Lake Project Map. The map depicting the One Lake Project follows on the next page.

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[INSERT SITE PLAN MAP FOR ONE LAKE PROJECT]

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Development Agreement

On May 8, 2015, City and Canon Station (as defined under “– Master Developer” below) entered into an Amended and Restated Development Agreement (“Restated Development Agreement”) originally concerning the development of the One Lake Project, and was recorded in the Official Records of the County on June 10, 2015, as Document No. 201500051329. The Restated Development Agreement was subsequently amended by a First Amendment to Development Agreement recorded in the Official Records of the County on February 17, 2016, a Second Amendment to Development Agreement recorded in the Official Records of the County on January 27, 2017, an unrecorded Agreement and Consent to Modification and Correction of Development Agreement dated as of August 21, 2017, a Third Amendment to Development Agreement recorded in the Official Records of the County February 19, 2019, a Fourth Amendment to Development Agreement recorded in the Official Records of the County on June 22, 2021, and a Fifth Amendment to Development Agreement dated as of September 12, 2024 (as so amended, the “Development Agreement”).

Under an Assignment and Assumption Agreement recorded in the Official Records of the County on January 24, 2020, Canon Station assigned all of its rights in, to and under the Development Agreement with respect to the One Lake Project to the Master Developer, and as such, the Master Developer is the sole “Developer” under the Development Agreement with respect to the One Lake Project.

The Development Agreement governs the entitlement of the One Lake Project as a whole and provides the Master Developer the vested right to construct a maximum of 3,101 housing units and 65,000 square feet of commercial floor area and library space, subject to certain conditions of development.

The Development Agreement has a term of 20 years, commencing on its effective date of October 25, 2011.

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Conditions of Approval

The Development Agreement, the Specific Plan, and the Master Planned Unit Development (the “MPUD”) require various conditions for the development of the One Lake Project. Many of the conditions are linked to the number of building permits or occupancy permits issued by the City in the One Lake Project as a whole, or with respect to Planning Area 5 only.

The following table provides the estimated number of permits that have been issued, or may potentially be issued, as of August 30, 2024:

Building Permits Occupancy Permits
Planning Area 4 (Other than Neighborhood 9)
Single-Family Units Received 590 468
Single-Family Units Potential 33 155
Apartment Complex Received 190 190
Totals 813 813

Planning Area 5 (Other than Neighborhoods P & Q)
Single-Family Units Received 9 0
Single-Family Potential 923 932
Totals 932 932

Grand Totals without Neighborhoods 9, P, & Q 1,745 (1) 1,745 (1)

(1) Neighborhood 9 in Planning Area 4 has the potential for 200 additional multi-family units, and Neighborhoods P and Q of Planning Area 5 has the potential for an additional 172 multi-family units.

If both of those are included in the potential permit count, the total would be 2,117.

Conditions for Entirety of the One Lake Project. Descriptions of some of the facilities required as conditions of developing the property in Improvement Area No. 1 based upon development in both Planning Area 4 and Planning Area 5 are described below:

At the 1,750th Building Permit:

• Great Park Phase I must start construction and finish in 36 months, or at a later date determined by the City. The Great Park is a 50-acre public park. Preliminary concept plans are being prepared by the City at the expense of the Master Developer.

• All improvements to New Canon Road shall be constructed from Vanden Road to North Gate Road. However, see “Potential Conditions Revision” below.

• Extension of the full complement of utilities (water, sewer, drainage, natural gas, electrical, and communication) into Planning Area 6 (an industrial project located east of Planning Area 5); and development of a minimum of 50-acres of industrial land, with development meaning the following: final map has been recorded, creating one or more parcels; street improvements have been constructed to serve each of the parcels created in the final map; rough grading has been completed; and utilities have been installed to serve each of the parcels created in the final map.

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At the 400th Building Permit:

• Segment 1 of the pedestrian trail going from Peabody Road to Lake Trail to Vanden must start construction. Segment 1 is a former railroad line right-of-way (owned by the City of Fairfield) and is not located within Improvement Area No. 1. A portion of Segment 1 required environmental cleanup. The Master Developer has completed the DTSC Remedial Action Plan and grading work of Segment 1. Pending DTSC final closure determination with the City, Master Developer will commence landscape improvements of a portion of Segment 1.

Other Conditions:

• Segments 2-5 of the pedestrian trail must be started at various times as follows: Segment 2 at the 1,200th building permit; Segment 3 at the 1,250th building permit; Segment 4 at the 1,500th building permit; and Segment 5 at the 1,600th building permit. However, see “Potential Conditions Revision” below.

Conditions on Planning Area 5 Only. Descriptions of some of the facilities required as conditions of developing the property in Improvement Area No. 1 based upon development in Planning Area 5 only are described below:

At the 300th Building Permit:

• Place Making items for the Linear Park shall commence construction upon the issuance of the 300th building permit and be completed within 18 months. Conceptual landscaping plans have been submitted to the City for review and approval.

At Approximately 740th Building Permit:

• The Master Developer shall design and complete improvements extending Vanden Road from the current terminus to the City limits prior to issuing any building permits in Planning Area 5 beyond 67% buildout of Planning Area 5 (approximately 740 units). However, see “Potential Conditions Revision” below.

Other Conditions:

• Design and construction of the Zone 2 Pump Station prior to the issuance of the first certificate of occupancy necessitating operation of the Zone II Pump Station. Master Developer has completed the design and the City has approved it. The City and Master Developer have conducted, or will conduct, studies to determine whether the Zone 2 Pump Station is needed for Planning Area 5. The Zone 2 Pump Station is in the budget and is tentatively scheduled for construction in April 2027.

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Conditions for Specific Neighborhoods in Planning Area 5. Descriptions of some of the facilities required as conditions of developing specific neighborhoods within Planning Area 5 are described in the table below:

Neighborhood Condition

R Prior to the first certificate of occupancy in Neighborhood R, a berm or berm/wall combination along the Vanden Road frontage must be completed, unless a subsequent noise assessment is provided demonstrating that the proposed residential units will not be significantly impacted by noise impacts from Vanden Road. As part of the approved improvement plans, a sound wall is under construction and will be completed prior to certificates of occupancy for Neighborhood R.

And

By the 404th building permit in Planning Area 5, the Master Developer shall complete construction of the proposed 0.82-acre “Boot Park”.

The Boot Park has been designed and is a condition to the development of Neighborhood R, but the City acknowledges that construction of the Boot Park cannot commence until all of the improvements at the intersection of Lake Trail and Vanden Road are completed.

A/B The Master Developer shall complete construction of the proposed Dog Park prior to issuance of the 33rd certificate of occupancy within Neighborhood A/B. Conceptual plans are in process.

E/F Master Developer shall complete construction of the proposed 0.48- acre pocket park prior to the City’s issuance of the 100th building permit for Neighborhoods E/F.

I-1 or I-2 Construction of the public portion of the Sports Park and Complex shall commence concurrently with construction of Neighborhood I-1 or Neighborhood I-2 and be completed and operational within 18 months. The development improvements for Neighborhood I are not planned to commence until 2026-27.

Potential Conditions Revision. The Development Agreement allows the City to assign transportation improvements to the Master Developer in a logical manner, taking into consideration current needs, surrounding development, etc. The City is limited in what it may assign by a budget of approximately $67 million (in 2023 dollars), $30 million of which has already been assigned. The City and the Master Developer are in the process of revising the Development Agreement and the other conditions of approval to re-prioritize certain improvements, with an emphasis being placed on the completion of the Vanden Road improvements. The revised priority may result in the modification or elimination of certain conditions described above. The revisions have not yet taken place.

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Public Infrastructure Improvements Required for the One Lake Project

For the One Lake Project as a whole, the Master Developer estimates that it will expend approximately $626,630,451 in land, infrastructure, financing costs. As of August 30, 2024, the Master Developer and its predecessors have expended approximately $348,438,942.

The total infrastructure cost to deliver 932 housing units in finished lot condition in Improvement Area No. 1 in Planning Area 5 totals $109,524,912 or $117,516 per lot. This compares favorably to Planning Area 4, which is nearly fully developed and consists of 833 housing units and totals $126,911,887 in backbone and in-tract costs, or $152,355 per housing unit. Planning Area 4 was disproportionately burdened with upfront infrastructure costs due to extending city utilities to the One Lake site, and the development of the 10-acre Lake and 11-acre Lake Park. The remaining cost to complete the development of Planning Area 4, which has been fulling developed except for Neighborhood 9, amounts to approximately $3,400,000 of which the bulk of those costs are directly related to the completion of the One Lake Club House and the swimming pool facilities.

The table below shows (i) the infrastructure improvements and fees required for the development of the One Lake Project as a whole (including Improvement Area No. 1) and (ii) separately, the infrastructure improvements and fees required for the development Improvement Area No. 1 only. All such improvements and fees are payable by the Master Developer.

Table 6
Estimated Improvement Costs
(Planning Areas 4 and 5)
(As of August 30, 2024)

Estimated Costs to be
Incurred by Master
Developer
Total
Estimated
Costs for
One Lake
Project
Total
Estimated
Improvement
Area No. 1
Costs
Completed
Improvement
Area No. 1
Costs
Percentage
Complete of
Improvement
Area No. 1
Costs
Remaining
Improvement
Area No. 1
Costs
Grading $23,244,513 $6,628,475 $4,487,254 68% $2,141,221 Backbone Infrastructure 48,385,515 17,245,674 5,386,854 31% 11,858,820 Community Amenities 19,998,510 11,380,000 -- 0% 11,380,000 Landscape & Parks 22,857,043 11,196,684 -- 0% 11,196,684 Consultants & Fees 33,528,159 7,369,671 4,168,892 57% 3,200,779 Subtotal Backbone
Infrastructure
$148,013,740 $53,820,504 $14,043,000 26% $39,777,504

In-tract Improvements 88,423,059 55,704,408 12,878,828 23% 42,825,580

Total $236,436,799 $109,524,912 $26,921,828 25% $82,603,084

Source: Master Developer.

Improvement Area No. 1 Development Status Summary

Grading and Infrastructure Status. The first development phase of Improvement Area No. 1, which consists of Neighborhoods R, O, K-1, L, J, K-2, A/B, and C, were mass graded in the spring of 2023, and the infrastructure improvements connecting Planning Area 4 and Planning Area 5 were commenced in the fall of 2023. The main backbone work consists of a significant roadway bridge that spans over the California Aqueduct, a 30-inch waterline, sewer, storm drain and electrical lines, have been fully installed along Club Drive, the main roadway into Packet Page 272 of 530Attachment 3 Page 59 of 129

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Improvement Area No. 1. All in-tract improvements for Neighborhoods R and O are fully completed, and the improvements for Neighborhoods K-1 and L will be completed before the end of October 2024. Once the Final Maps for Neighborhoods J and A/B have been approved, the Master Developer intends to install the wet utilities (storm, and sewer).

Subdivision Mapping Status. All of the property in Improvement Area No. 1 is being developed in accordance with a tentative subdivision map entitled “Tentative Map, One Lake – Planning Area 5” dated May 27, 2021. Final subdivision maps have been approved for Neighborhoods R, O, K-1 and L, and portions of Neighborhoods J and N.

Development Status and Development Plan. The development status, subdivision mapping status and anticipated development plan for the property in Improvement Area No. 1 as of August 28, 2024, is shown on the following table.

Table 7
Property Ownership, Planned Development and Development Status As of August 28, 2024

Neighborhood Acreage
Number
of Lots Lot Size Development Type
Development
Status
Actual and Projected Map
Status

Phase 1
R 8.63 65 45x70 Single-Family Detached Finished Lots Final Map Recorded December 15, 2022
O 9.65 10 50x80 Single-Family Detached Finished Lots Final Map Recorded December 15, 2022
56 50x80 Single-Family Detached Finished Lots Final Map Recorded December 18, 2023
K-1 2.77 20 58x75 Courtyard Cluster Substantially
Finished Lots
Final map recorded
December 15, 2022
K-2 2.30 12 58x75 Courtyard Cluster Rough Graded Tentative Map (Final Map Nov-2024)
L 2.78 20 58x75 Courtyard Cluster Substantially
Finished Lots
Final map recorded
December 15, 2022
J 7.69 62 46x65 Single-Family Detached Rough Graded Tentative Map (Final Map Nov-2024)
7 46x65 Single-Family Detached Rough Graded Final map recorded December 15, 2022
A/B 12.12 67 50x80 Single-Family Detached Rough Graded Tentative Map (Final Map Jan-2025)
C 11.7 85 46x75 Single-Family Detached Rough Graded Tentative Map (Final Map Mar-2025)
Phase 2
H 14.79 93 50x80 Single-Family Detached Rough Graded Tentative Map (Final Map Aug-2025)
I-1 3.88 28 58x75 Courtyard Cluster Rough Graded Tentative Map (Final Map Aug-2025)
I-2 2.30 12 58x75 Courtyard Cluster Rough Graded Tentative Map (Final Map Aug-2025)
Phase 3
N 12.27 72 46x75 Single-Family Detached Rough Graded Tentative Map (Final Map Mar-2026)
7 46x75 Single-Family Detached Rough Graded Final Map Recorded December 18, 2023
M 3.24 24 58x75 Courtyard Cluster Rough Graded Tentative Map (Final Map Mar-2026)
G 16.20 70 50x90 Single-Family Detached Rough Graded Tentative Map (Final Map May-2026)
Phase 4
D 16.96 122 46x75 Single-Family Detached Rough Graded Tentative Map (Final Map Sep-2027)
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E/F 16.74 100 55x80 Single-Family Detached Rough Graded Tentative Map (Final Map Jan-2028)

Totals 144.02 932

Source: Master Developer

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Existing and Planned Sales to Merchant Builders

The Master Developer is not a homebuilder and is developing the property through the sale of finished lots to merchant builders. As of August 28, 2024, Lennar Homes had acquired 131 lots within Neighborhood O and Neighborhood R, and the Master Developer has executed Purchase and Sales Agreements (“PSA”) with (i) Century Communities or an affiliate thereof (“Century Communities”) for Neighborhood J and (ii) Tri Pointe Homes Holdings (formerly known as TRI Pointe Homes, Inc.), a Delaware corporation, or an affiliate thereof (“Tri Pointe”), for Neighborhoods K-1, L, and K-2. In addition, Tri Pointe is presently reviewing a drafted PSA for the purchase of Neighborhood A/B. The Master Developer will continue to market the other neighborhoods to merchant builders to be identified in the future. The current status of lot sales to merchant builders is described below.

Table 8
Actual and Projected Lot Sales to Merchant Builders
As of August 28, 2024

Neighborhood
Number
of Lots Property Owner Merchant Builder
Purchase
Agreement
Status
Development
Status
Actual or
Projected
Closing
Date

Phase 1
R 65 Lennar Homes Lennar Homes Signed Finished Lots Closed O 66 Lennar Homes Lennar Homes Signed Finished Lots Closed K-1 & L 40 Master Developer Tri Pointe Signed
Substantially
Finished Lots Nov-2024
K-2 12 Master Developer Tri Pointe Signed Rough Graded Sep-2025 J 69 Master Developer Century Comm. Signed Rough Graded Sep-2025 A/B 67 Master Developer Tri Pointe Final Draft Rough Graded Oct-2025 C 85 Master Developer TBD TBD Rough Graded Nov-2025
Phase 2
H 93 Master Developer TBD TBD Rough Graded Oct-2026
I-1 28 Master Developer TBD TBD Rough Graded Oct-2026
I-2 12 Master Developer TBD TBD Rough Graded Oct-2026
Phase 3
N 79 Master Developer TBD TBD Rough Graded Oct-2027
M 24 Master Developer TBD TBD Rough Graded Oct-2027
G 70 Master Developer TBD TBD Rough Graded Nov-2027
Phase 4
D 122 Master Developer TBD TBD Rough Graded Oct-2028
E/F 100 Master Developer TBD TBD Rough Graded Oct-2028 Totals 932

Source: Master Developer.

No assurance can be given that the Master Developer will close on the projected lot sales shown in the table above on the time frames shown above, or as to the timing of any future lot sales.

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Entitlements

Specific Plan. The Specific Plan, known as the Fairfield Train Station Specific Plan, was originally adopted by the City Council on July 26, 2011, and as subsequently amended. The Specific Plan guides the development for the last growth area within the City, and encompasses approximately 2,972 acres with (i) approximately 60% representing open space and habitat conservation open space, (ii) approximately 17% for residential use, (iii) approximately 10% representing industrial use, and (iv) the balance of approximately 13% representing retail/commercial and parks. The land subject to the Specific Plan is anticipated to ultimately be developed with a diverse mix of housing, shopping, employment and recreational opportunities within walking distance of each other.

Zoning. Improvement Area No. 1 is zoned TS-PD (Train Station Specific Plan) by the City, which allows for residential low, medium & high density development.

Utilities. Utility services to the property within Improvement Area No. 1 will be supplied by the following:

• Water: City of Fairfield
• Sewer: City of Fairfield and the Fairfield-Suisun Sewer District • Storm drain: City of Fairfield
• Electricity and gas: Pacific Gas & Electric
• Telephone: AT&T
• Cable TV: Comcast
• Refuse collection: Republic Services

Environmental Matters

Environmental Impact Report. The City certified the final Environmental Impact Report for the Specific Plan (the “EIR”) under the California Environmental Quality Act on July 26, 2011.

Hazardous Substances. The former railroad right-of-way, along the southern and western property boundaries of Improvement Area No. 1 has been impacted with elevated concentrations of arsenic and lead. The former railroad right-of-way, which is owned by the City and not a part of the One Lake Project, will be improved with a Linear Park Trail. Remedial work was necessary to remove these areas of the impacts, in-order to allow for the proposed trail redevelopment. The Master Developer, through the completion of a Phase II Environmental Site Assessment, conducted field reconnaissance and soil sampling to delineate the extent of the arsenic soil impact. The scope of the Phase II Assessment includes an arsenic background soil analysis, additional step-out and vertical soil sampling, groundwater sampling, and groundwater leachability analysis. Based on the work completed, the extent of anthropogenic impact to the rail spur soils was limited to a 50-foot wide corridor along the centerline of the former rail spur alignment. Acting as agent for the City, the Master Developer prepared all the necessary documentation and testing analysis to meet compliance with Department of Toxic Substance Control (“DTSC”) requirements for the former railroad right-of-way, approximately 5.1 acres in size. With oversight from DTSC, the Master Developer has completed all the remediation work and is awaiting the closure letter from DTSC. All such remediation necessary for the development of Improvement Area No. 1 as described in this Official Statement, including for merchant builders to obtain building permits within Improvement Area No. 1, has been completed.

Flood Hazard Map Information. The District is located in an area of minimal flooding according to the Federal Emergency Management Association (“FEMA”). In particular, Improvement Area No. 1 is located in an area designated by FEMA as being within Zone X, with Packet Page 276 of 530Attachment 3 Page 63 of 129

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a 0.02% chance of flooding in any given year. See “BOND OWNERS’ RISKS – Property Values – Natural Disasters.”

Seismic Conditions. Like other areas of Northern California, property in the District is subject to the risk of major earthquake damage. The City is located along the eastern edge of the seismically active Coast Ranges of California. Active faults near the City include the Green Valley and Cordelia faults. Most large earthquakes in the Bay Area have occurred along the major faults including the San Andreas, Hayward, and Calaveras faults, which are located 20 to 45 miles west and south of the City. A significant earthquake along these or other faults is possible during the period the 2024 Bonds will be outstanding. See “BOND OWNERS’ RISKS – Property Values – Natural Disasters.”

Environmental Permits and Requirements. In connection with the development of the One Lake Project, the Master Developer has obtained permits from Army Corps of Engineers, US Fish and Wildlife Service, California Department of Fish and Wildlife, and California State Water Resources Control Board (collectively, the “Environmental Permits”). Such permits establish requirements to avoid, minimize, and mitigate impacts to wetlands, streams, and threatened and endangered species. Compliance with these permits fall into three, interrelated primary categories: (i) avoidance and minimization of impacts during project construction; (ii) wetland mitigation; and (iii) habitat conservation for endangered species. The following summarizes compliance and ongoing activities related to these permits for Improvement Area No. 1, and the One Lake Project as a whole.

Avoidance and Minimization of Impacts During Project Construction. The Environmental Permits contain multiple requirements for compliance with multiple construction period conditions.

These conditions include requirements for ongoing compliance such as monitoring by approved biologists and other technical disciplines, environmental training for construction crews, work restrictions during wet weather, and capture and relocation of threatened and endangered species, most notably the threatened California tiger salamander.

The One Lake Project is in good standing with all agencies with respect to the Environmental Permits and has demonstrated ongoing compliance with all required permit conditions to each relevant agency and is up to date on all reporting requirements. The California Department of Fish and Wildlife has also agreed that all construction related conditions (limiting construction periods and timing) are no longer required within Improvement Area No. 1.

Additionally, from November 2018 through March 2020, the Master Developer relocated approximately 6,780 California tiger salamanders from the One Lake Project to designated habitat mitigation lands (owned by the Master Developer) in compliance with permit requirements.

Wetland Mitigation. Under the Environmental Permits issued by the US Army Corps of Engineers and State Water Resources Control Board, the Master Developer is required to provide compensatory mitigation for the authorized impacts to wetlands by establishing (constructing)

20.12 acres of vernal pool habitat, rehabilitating 21.00 acres of existing vernal pool, and enhancing functions on an additional 45.03 acres of existing wetlands. Construction activities for implementing of the wetland mitigation requirements was initiated in the summer of 2018 and completed in the late summer 2019. An as-built compliance report and ongoing monitoring, including hydrological monitoring of constructed and rehabilitated wetlands from 2020 to 2024, document compliance with the required mitigation. The as-built compliance report was submitted to the agencies in March 2020.

Habitat Conservation for Endangered Species. The Master Developer is required to secure Habitat Mitigation Lands under conservation easements in a phased approach concurrent with construction. The Master Developer owns approximately 590 acres of “onsite” lands which Packet Page 277 of 530Attachment 3 Page 64 of 129

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are dedicated to the mitigation requirement and has purchased the rights to place a conservation easement on an additional approximately 1,273 acres of offsite land The conservation easement for the 1,273-acre offsite lands was recorded in July 2022. The 1,863 acres of the conservation lands satisfies the habitat mitigation land requirements for the California Department of Fish and Wildlife for permitted activities in all of Improvement Area No. 1 as well as development in Planning Area 4 and permitted road construction in Planning Area 6. The conservation easements for the onsite lands are currently in the final stages of review and final approval with the California Department of Fish and Wildlife and U.S. Fish and Wildlife Service. The Master Developer’s consultants have been working diligently with California Department Fish and Wildlife for the past 36 months on finalizing all the documents and the wording of the Conservation Easement Agreement. The Master Developer expects to be in the position to record the onsite Conservation Easement on the mitigation property by November 2024. Costs for the conservation easements and required funding for management of these lands are secured by existing financial assurances (mostly surety bonds and letters of credit) provided as part of the permit with the California Department of Fish and Wildlife.

Master Developer Financing Plan for Improvement Area No. 1

The Master Developer is using the proceeds of a borrowing secured by the One Lake Property (discussed below), proceeds of lot sales, and equity to finance the planned development for Improvement Area No. 1.

First Trust Deed. On November 17, 2023, the Master Developer closed on a $69,600,000 million loan facility from Encore Capital (the “Encore Loan”). The Encore Loan provided funds to fully repay the outstanding loan of $30 million from Trez Capital and certain former Canon Station managing owners in the amount of $8.3 million.

The Encore Capital loan is a 3-year revolving facility with a 6-month extension option that will allow a continued recycling of loan funds as long as the outstanding loan funds do not exceed a 70% Loan-to-Value ratio (LTV) until the loan is paid down by $20,000,000, at which time the maximum LTV will be reduced to 60% for the remaining term of the loan. This loan facility, coupled with lot sales revenues, and CFD bond proceeds are anticipated to provide sufficient funds to complete the balance of the infrastructure improvements for the One Lake Project. Encore Capital, located in Corte Madera, California, is a non-traditional lender, and their loan financing costs are higher in comparison to conventional banking sources, however, providing that the 60% LTV threshold is not exceeded, their accelerated repayment requirement (80% of the net sales proceeds) provides additional loan borrowings until the Loan is fully repaid.

The Encore Capital loan is secured with a first deed of trust on (i) all of Improvement Area No. 1 in Planning Area 5 (other than the parcels owned by Lennar Homes), (ii) Neighborhoods P and Q of Planning Area 5, and (iii) Neighborhood 9 of Planning Area 4. Recourse guaranties and completion guaranties were provided by Daniel Aguilar and Steve Riter.

As of August 30, 2024, excluding interest reserves, $65,000,000 of the $69,600,000 Encore Loan has been drawn and is outstanding, however, the outstanding loan balance will be paid down by $15 to $20 million over the next couple of months from the net sales proceeds of Neighborhoods K-1 and L, and proceeds from the sale of the 2024 Bonds. As of September 26, 2024, no default has occurred or is continuing with respect to the Encore Loan or the Deed of Trust which secures such Loan. Interest on the outstanding balance of the Encore Loan is payable monthly, with the outstanding principal due at maturity.

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Cash Flow Summary. A summary of the expected cash flow for the Master Developer and the development of the One Lake Project, including Improvement Area No. 1, is set forth below:

Table 10
Master Developer Sources and Uses
One Lake Project
(As of August 30, 2024)

Actual Projected Projected Projected
Through Through
12/31/2024
Through
12/31/2025
Through
12/31/2026

Totals 8/30/2024 (1) Thereafter
Sources
Land Sales-Single Family (2) $121,394,132 $9,038,525 $49,550,070 70,306,014 104,736,488 $355,025,229 Land Sales-Townhomes -- -- -- - 36,047,900 36,047,900 Land Sales-Apartments 5,700,000 -- -- - - 5,700,000 Land Sales-Commercial -- -- -- 2,444,934 - 2,444,934 Mitigation Credit Sales (net) 7,554,375-- (1,670,302) -- 1,501,000 11,984,239 19,369,312 CFD Net Bond Proceeds (3) 23,780,162 20,000,000 -- 17,418,809 17,418,809 78,617,780 Urbanite Loan 32,000,000 -- -- - - 32,000,000 Seller Note 10,020,787 -- -- - - 10,020,787
Trez Capital Loan 26,165,934 5,290,468 8,543,598 - - 40,000,000 Encore Funds loan 74,822,717 9,562,141 37,174,291 23,004,692 - 144,563,841 Equity 55,068,795 -- 764,813 - - 55,833,608 TOTAL SOURCES 356,506,902 42,220,832 96,032,772 114,675,449 170,187,436 779,623,391

Uses
Land 34,622,523 488,644 1,250,113 1,620,043 37,981,323 Northeast Transportation
Improvements (4)
1,243,609 1,418,195 2,812,140 10,149,615 27,867,716 43,491,275 Loan Paydown Urbanite 32,000,000 -- -- - - 32,000,000 Loan Paydown Seller Note 10,020,787 -- -- - - 10,020,787 Loan Paydown Trez Capital 40,000,000 -- -- - - 40,000,000 Loan Paydown Encore 13,081,309 25,038,525 51,980,800 54,463,207 - 144,563,841 Distributions
12,500,000 --
-
- 12,500,000
Carrying Costs 7,027,694 239,669 245,672 191,597 82,426 7,787,058 Backbone Infrastructure 116,259,483 4,182,212 11,245,614 11,109,327 7,572,486 150,369,122 In-tract Improvements 45,498,541 9,366,604 7,994,328 12,267,430 13,296,156 88,423,059 Overhead and administration 7,524,959 310,480 690,717 358,654 117,546 9,002,356 Loan Interest and Fees 28,245,614 5,112,583 6,744,842 1,108,721 - 41,211,760 Contingency -- -- -- - 8,565,547 8,565,547 TOTAL USES 348,024,519 46,156,912 82,964,226 91,268,594 57,501,877 625,916,128

NET CASH FLOW
Beginning Balance -- 8,482,383 4,546,303 17,614,849 41,021,704 153,707,263 Net Cash Flows 8,482,383 (3,936,080) 13,068,546 23,406,855 112,685,559 -- Ending Balance (5) 8,482,383 4,546,303 17,614,849 41,021,704 153,707,263 153,707,263

(1) Includes all revenues and costs associated with every source or cost incurred by the Master Developer in the development of the One Lake Project (i.e., Planning Areas 4 and 5), through August 30, 2024. (2) Estimates are based on actual and projected sales as follows: (i) purchase and sale agreements for neighborhoods K-1, L, K- 2 and J; and (ii) expected sales for neighborhoods A/B and C. Thereafter, land sales assume sales of Phase 2 (H, I-1, I-2) in 2026, Phase 3 (N, M, G) in 2027, and Phase 4 (D, E/F) in 2028. (3) The CFD Net Bond Proceeds includes net bond proceeds from prior CFD No. 2019-1 bond sales in 2019 and 2021, and the expected 2024 Bonds for Improvement Area No. 1 of CFD No. 2023-1 and future parity bonds. (4) Represents costs for offsite public improvements, such as roadway, traffic signals, landscaping, etc., that are located within the Specific Plan.
(5) A portion of the ending balance is held in escrow to be used for backbone infrastructure improvements.

Source: Master Developer.

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The Master Developer

General. The Master Developer is One Lake Holding LLC, a Delaware limited liability company, and is 100% owned by Canon Station, LLC, a California corporation (“Canon Station”).

The controlling interest in Canon Station is held by McKinley Partners Fairfield LP, a Delaware limited partnership (“McKinley Fairfield”), formed by McKinley Realty Partners (“McKinley”), a privately held, fully integrated real estate operator and fund management firm. McKinley has full authority to manage both Canon Station and the Master Developer.

Principals. McKinley’s principals are Daniel Aguilar, Steve Riter, and Jeff Shaffer. Mr.

Aguilar and Mr. Riter, who are also officers of the Master Developer, are located in Walnut Creek, while Mr. Shaffer is headquartered in San Diego. Brief biographies of Mr. Aguilar, Mr. Riter, and Mr. Shaffer follow.

Daniel Aguilar, Founding Principal.

• Over 41 years of residential development experience.
• Co-founded McKinley Partners in 2006, along with Steve Riter, and raised a $25 million land fund to acquire seven distressed residential development projects in northern and southern California. This included the co-management of two master-planned communities that have been fully developed or nearing completion. Most of those assets were sold once they were repositioned or re-entitled after the Great Recession. • Prior to McKinley Partners, Aguilar was a partner at Mission Valley Properties from 1990 to 2006, where he successfully optioned and procured entitlements for six residential developments in the northern part of the San Francisco Bay Area. • From 1996 to 1998, Mr. Aguilar worked as a consultant procuring entitlements (development approvals) on several projects within the greater San Francisco Bay Area. • From 1988 to 1995, Mr. Aguilar worked for Southwest Diversified/Coscan, now Brookfield Homes, VP of finance and land acquisition.
• His first job after receiving his MBA from UCLA was for Citicorp Real Estate Group, as a VP of construction lending from 1980 to 1988.

Steve Riter, Founding Principal.

• Over 39 years of residential development experience.
• Mr. Riter co-founded McKinley Partners in 2006, directing all investment strategies of the Company and acting as primary manager of many acquisitions and land development efforts of McKinley investment portfolio projects.
• Mr. Riter was also a partner in Mission Valley Properties where he acquired, entitled, and developed residential projects throughout Northern California. • Prior to joining Mission Valley Properties, he was VP of Land Acquisition and Development at Catellus Residential Group and was responsible for acquiring and entitling residential properties and building a regional California homebuilder presence. • From 1990 – 1996, Mr. Riter’s professional experience included residential land acquisition and development experience with SummerHill Homes, a subsidiary of Marcus & Millichap Inc. and Southwest Diversified/Coscan (now known as Brookfield Homes). • From 1984 to 1990 he was Project Controller for the Vintage Club, with Vintage Properties a $1.1 billion mixed-use residential and commercial development company, where he later transitioned to Manager of Land Acquisition.
• Mr. Riter was a member of the Board of Directors of Seneca Center, a $75 million non- profit serving children and families in the San Francisco Bay Area.

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• He received a Bachelor of Science in Business from Brigham Young University in 1981 and conducted Master of Business Administration studies at John F. Kennedy University.

Jeff Shaffer, Principal.

• Over 29 years of residential development experience.
• Joined McKinley Partners in 2007 to head up Southern California acquisitions and investments. After the initial land fund acquisitions, he ran the foreclosed home acquisitions and portfolios in Southern California and San Antonio. In 2015, he become the principal manager of the $30 million Development Capital Fund, and in 2018 raised and manages the $100 million Opportunity Fund X (OFX).
• As part of the OFX, Mr. Shaffer is on the six-person Executive Committee overseeing the development in the 1800-unit Carroll Canyon master planned development in San Diego, in a joint venture with California West Communities, Lennar Homes, and Shea Homes.

The OFX is also invested in real estate developments in the San Francisco Bay Area, Sacramento, and Salt Lake City.
• Prior to McKinley, Mr. Shaffer joined a regional homebuilder, SeaCountry Homes, as their VP of Operations managing the entitlement, development, and operations in San Diego, Riverside, and San Bernardino counties, where he brought to market over 600 lots and homes in 3 years.
• In 1999, he then joined Pacific Ridge as the development manager for a 90,000 sq. ft. themed retail center in Sedona, Arizona, and several other projects totaling over 130,000 sq. ft. of retail.
• In 1996, he partnered to form a land development and homebuilding venture (Granite Homes), purchasing RTC and bank-owned assets out of the early 1990s real estate downturn. That company rapidly expanded from an initial 21-lot holding to ultimately controlling approximately 1,435 lots in Sacramento and San Diego, California, San Antonio, Texas, and Phoenix, Arizona.
• Prior to his involvement in real estate, Mr. Shaffer worked on national security and military strategy issues for the Center for Strategic and International Studies in Washington, D.C. • He earned a BA in International Relations from UCLA and a Master's degree in National Security Studies from Georgetown University.

Development Experience. Prior projects for which McKinley managed or co-managed include:

• Jordan Ranch – 890 residential units, Dublin, California. Developed lots sold to Brookfield, Tri Pointe, Toll Bros., and Landsea; completed and sold out.

• Alamo Creek – 141 residential units, Vacaville, California. Approved lots sold to Tri Pointe and 141 single family units completed and sold out; the 10-acre balance of the site was sold to an apartment developer in 2022.

• The Vineyard - 351 residential units, Ontario, California. Developed lots sold 229 lots to DR Horton and 122 lots to Woodside Homes; all 351 residential units completed and sold out.

• Arroyo Crossing – 155 residential units, Livermore, California. Approved lots sold to Obrien Group; completed and sold out.

• Carroll Canyon (master planned community) – 1,800 residential units, San Diego.

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Homes, and California West Homes. Roughly 60% of the residential lots have been fully developed and improved with single-family and townhomes.

As of August 30, 2024, the Master Developer believes that the One Lake Project is adequately capitalized and that there will not be a need for any additional equity investment. If necessary, the Master Developer has the ability to borrow additional funds secured by the One Lake Project.

Further information regarding the Master Developer is available from the McKinley website at www.mckinleycp.com . This internet address is included for reference only, and the information on the internet site is not a part of this Official Statement and is not incorporated by reference into this Official Statement.

Lennar Homes

General. Lennar Homes of California, LLC, a California limited liability company (previously defined as “Lennar Homes”) is based in Irvine, California, and has been in the business of developing residential real estate communities in California since 1996. Lennar is wholly-owned by U.S. Home, LLC, a Delaware limited liability company (“U.S. Home”). U.S. Home is wholly-owned by Lennar Corporation, which is based in Miami, Florida (“Lennar Corporation”).

Founded in 1954, Lennar Corporation completed its initial public offering in 1971 and listed its common stock on the New York Stock Exchange in 1972. Lennar Corporation’s Class A and Class B common stock are listed on the New York Stock Exchange under the symbols “LEN” and “LEN.B.” respectively. Lennar Corporation is one of the largest homebuilders in the United States based on home sales revenues and net earnings, and operates under a number of brand names, including Lennar and U.S. Home. Lennar Corporation primarily develops residential communities both within the Lennar Corporation family of builders and through consolidated and unconsolidated partnerships in which Lennar Corporation maintains an interest.

Lennar Corporation is subject to the informational requirements of the Securities Exchange Act of 1934, as amended, 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 Lennar Corporation’s annual report on Form 10-K and its most recent quarterly report on Form 10 Q, may be inspected and copied at the public reference facilities maintained by the SEC at 450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates. Such filings can also be accessed over the internet at the SEC’s website at www.sec.gov . This internet address is included for reference only and the information on the internet site is not a part of this Official Statement and is 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 the internet site.

Copies of Lennar Corporation’s annual report and related financial statements are available from Lennar Corporation’s website at www.Lennar.com . This internet address is included for reference only and the information on the internet site is not a part of this Official Statement and is not incorporated by reference into this Official Statement.

Lennar Homes Funding In-Tract Improvements. Under the terms of the purchase and sale agreement between the Master Developer and Lennar Homes, the Master Developer is required to fund and construct all in-tract improvements associated with the lots being acquired.

As of September 19, 2024, all in-tract improvements are completed except the acceptance of water infrastructure by the City, completion of offsite sewer improvements (including sewer pump station), storm drain detention facility and energization of Neighborhood O.

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Lennar Homes Development Plan and Development Status. Lennar Homes’ development plan is to construct single-family detached homes on the lots it has acquired in Neighborhood O and Neighborhood R, as shown the tables below as of September 19, 2024.

Base sale prices are subject to change, and exclude any lot premiums, buyer selected options and upgrades, and any incentives, selling concessions or price reductions which may be offered.

Development Plans
Neighborhoods O and R

Floor
Plan
Square
Footage
Planned
Units
Base
Sales Prices
Neighborhood O Plan 1 2589 22 $767,000
Plan 2 2756 22 767,000
Plan 3 2905 22 767,000
Subtotal 66

Neighborhood R Plan 1 2111 21 $685,985
Plan 2 2257 22 685,985
Plan 3 2347 22 685,985
Subtotal 65

Total 131

Source: Lennar Homes

Set forth below is the status of home construction and sales within Neighborhood O and Neighborhood R as of September 19, 2024.

Status of Development
Neighborhoods O and R

Neighborhood
Planned
Units
Finished
Lots (1)
Building
Permits
Homes Under
Construction (2)
Completed
Homes
Owned by
Lennar (3)
Homes
Under
Contract
for Sale (4)
Home
Closings
O 66 65 0 1 0 0 0
R 65 53 9 12 0 0 0

(1) Finished lots are lots without any vertical construction. (2) Under construction means that a building permit has been issued and vertical home construction is in process.
(3) Includes 3 completed model homes.
(4) Represents homes under contract with individual homebuyers that have not closed escrow.

Source: Lennar Homes.

Lennar Homes anticipates buildout and final home sales in Neighborhood O by June 2026, and in Neighborhood R by June 2026.

Although the information in this Official Statement reflects the current development expectations of Lennar Homes, no assurance can be given that home construction and sales will be carried out on the schedule and according to the plans and at the prices described 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. Lennar Homes reserves the right to change its development at any time without notice. Additionally, homes under contract to be sold may not result in closed escrows as sales contracts are subject to cancellation. See “BOND OWNERS’ RISKS – Concentration of Ownership.”

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Lennar Homes Financing Plan. Lennar Homes intends to finance the development of its property using internal sources (equity and home sales proceeds). A summary of the costs incurred and anticipated to be incurred for the full buildout of the 66 lots within Neighborhood O is set forth in the following table:

Lennar Homes Financing Plan
Neighborhood O

Total Budget
Costs Incurred
Through
September 1, 2024
September 1, 2024,
through Buildout
Land $13,817,607 $0 $13,817,607
Site Construction 477,651 52,680 424,971
Direct Construction 17,086,139 0 17,086,139
Sales and Marketing 2,287,805 7,003 2,280,802
Total Projected Costs $33,669,202 $59,683 $33,609,519

Source: Lennar Homes.

Lennar Homes intends to finance the development of its property using internal sources (equity and home sales proceeds). A summary of the costs incurred and anticipated to be incurred for the full buildout of the 65 lots within Neighborhood R is set forth in the following table:

Lennar Homes Financing Plan
Neighborhood R

Total Budget
Costs Incurred
Through
September 1, 2024
September 1, 2024,
through Buildout
Land $12,117,719 $0 $12,117,719
Site Construction 484,999 53,490 431,509
Direct Construction 14,666,342 613,178 14,053,163
Sales and Marketing 2,041,931 9,641 2,032,290
Total Projected Costs $29,310,991 $676,309 $28,634,682

Source: Lennar Homes.

Although Lennar Homes expects to have sufficient funds available to complete its development in Improvement Area No. 1 in accordance with the development schedule described in this Official Statement, there can be no assurance that amounts necessary to finance the remaining planned development by Lennar Homes in Improvement Area No. 1 will be available from Lennar Homes or any other source when needed. Neither Lennar Homes, nor any of its related entities, are under any legal obligation of any kind to expend funds for the development of and construction of homes on its property in Improvement Area No. 1 and there is no direct recourse against Lennar Homes or any of its related entities for nonpayment of ad valorem property taxes or the Facilities Special Taxes. Any contributions by Lennar Homes to fund the costs of such development are entirely voluntary.

If and to the extent that the aforementioned sources are inadequate to pay the costs to complete the planned development by Lennar Homes within Improvement Area No. 1 and other financing by Lennar Homes is not put into place, there could be a shortfall in the funds required to complete the planned development by Lennar Homes in Improvement Area No. 1 or to pay ad valorem property taxes or Facilities Special Taxes related to Lennar Homes’ property in Packet Page 284 of 530Attachment 3 Page 71 of 129

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Improvement Area No. 1, and the remaining portions of such development may not be completed.

Many factors beyond Lennar Homes’ control, or a decision by Lennar Homes to alter its current plans, may cause the actual sources and uses to differ from the projections. See “BOND OWNERS’ RISKS” herein for a discussion of risk factors.

Other Merchant Builders

Tri Pointe. Tri Pointe is an indirect, wholly-owned subsidiary of Tri Pointe Homes, Inc., a Delaware corporation (“Tri Pointe Homes”), a publicly traded company whose common stock is listed on the New York Stock Exchange under the ticker symbol “TPH.” Tri Pointe Homes is engaged in the design, construction and sale of innovative single-family attached and detached homes in 15 markets across ten states and the District of Columbia.

Tri Pointe Homes is subject to the informational reporting requirements of the Securities and 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 set forth, among other things, certain data relative to the consolidated results of operations and financial position of Tri Pointe Homes and its consolidated subsidiaries, including Tri Pointe.

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 Tri Pointe Homes. The address of such Internet web site is www.sec.gov . All documents filed by Tri Pointe Homes 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 Tri Pointe Homes’ most recent Annual Report on Form 10-K and each of its other quarterly and current reports, including any amendments, are available in the “investors” portion of its website at www.tripointehomes.com .

The foregoing website addresses and references to filings with the SEC are given for reference and convenience only, and the information on such websites and on file with the SEC does not form a part of this Official Statement and is not incorporated by reference herein. No representation is made in this Official Statement as to the accuracy or adequacy of the information contained on such websites. Tri Pointe Homes and Tri Pointe are not obligated to advance funds for construction or development 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 websites in evaluating whether to buy, hold or sell the 2024 Bonds. The information contained on such websites may be incomplete or inaccurate and has not been reviewed by the City or the Underwriter.

Century Communities. Century Communities, Inc., is a publicly traded company whose common stock is listed on the New York Stock Exchange under the ticker symbol “CCS.” Century Communities The Colorado-based company operates in 18 states and over 45 markets across the U.S.,

Century Communities is subject to the informational reporting requirements of the Securities and 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 set forth, among other things, certain data relative to the consolidated results of operations and financial position of Century Communities.

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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 Century Communities. The address of such Internet web site is www.sec.gov . All documents filed by Century Communities 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 Century Communities’ most recent Annual Report on Form 10-K and each of its other quarterly and current reports, including any amendments, are available in the “investors” portion of its website at www.centurycommunities.com .

The foregoing website addresses and references to filings with the SEC are given for reference and convenience only, and the information on such websites and on file with the SEC does not form a part of this Official Statement and is not incorporated by reference herein. No representation is made in this Official Statement as to the accuracy or adequacy of the information contained on such websites. Century Communities is not obligated to advance funds for construction or development 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 websites in evaluating whether to buy, hold or sell the 2024 Bonds. The information contained on such websites may be incomplete or inaccurate and has not been reviewed by the City or the Underwriter.

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BOND OWNERS’ RISKS

The purchase of the 2024 Bonds described in this Official Statement involves a degree of risk that may not be appropriate for some investors. The following includes a discussion of some of the risks which should be considered before making an investment decision. 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 2024 Bonds.

Risks of Real Estate Secured Investments Generally

The Bondowners 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 Improvement Area No. 1, the supply of or demand for competitive properties in such area, and the market value of property in the event of sale or foreclosure, (ii) changes in real estate tax rates and other operating expenses, government rules (including, without limitation, zoning laws and restrictions relating to threatened and endangered species), (iii) natural disasters (including, without limitation, earthquakes, wildfires and floods), which may result in uninsured losses, or natural disasters elsewhere in the country or other parts of the world affecting supply of building materials that may cause delays in construction, and (iv) the impacts of a public health emergency on construction and sales activity, the national and regional economy and financial circumstances of property owners in Improvement Area No. 1. The occurrence of one or more of the events discussed herein could adversely affect the ability or willingness of property owners in Improvement Areas No. 1 to pay their Facilities Special Taxes when due, and could induce or exacerbate the risks described herein. See “– Value to Lien Ratios,” “– Levy and Collection of the Facilities Special Tax,” “– Property Tax Delinquencies,” and “– Bankruptcy Delays” below.

Limited Obligation of the City to Pay Debt Service

The City has no obligation to pay principal of and interest on the 2024 Bonds if Facilities Special Tax collections are delinquent or insufficient, other than from amounts, if any, on deposit in the 2024 Reserve Fund or funds derived from the tax sale or foreclosure and sale of parcels for Facilities Special Tax delinquencies. The City is not obligated to advance funds to pay Debt Service on the 2024 Bonds. See “SECURITY FOR THE 2024 BONDS – Limited Obligation.”

If Special Tax Revenues are insufficient to pay debt service on the 2024 Bonds, the District’s ability to increase Facilities Special Tax rates is limited as described under “SECURITY FOR THE 2024 BONDS – Facilities Special Taxes” and the Fiscal Agent may be compelled to draw upon moneys in the 2024 Reserve Fund, resulting in a rapid depletion of such fund. See “SECURITY FOR THE 2024 BONDS – 2024 Reserve Fund.”

Potential Early Redemption of Bonds from Facilities Special Tax Prepayments

The property owner of any parcel of taxable property within Improvement Area No. 1 is permitted to prepay up to 75% of the Facilities Special Tax obligation applicable to that parcel at any time. Any such payments will result in a mandatory redemption of Bonds from Facilities Special Tax prepayments on the next Interest Payment Date for which timely notice may be given under the Fiscal Agent Agreement following the receipt of any such Facilities Special Tax prepayment. Any resulting redemption of 2024 Bonds that were purchased at a price greater than par could reduce the otherwise expected yield on such 2024 Bonds. See “THE 2024 BONDS – Redemption.”

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Concentration of Property Ownership

Failure of any significant owner of taxable property within Improvement Area No. 1, such as the Master Developer, Lennar Homes, and any future merchant builder, to pay the annual Facilities Special Taxes when due could result in the rapid, total depletion of the 2024 Reserve Fund prior to replenishment from the resale of the property upon a foreclosure or otherwise or prior to delinquency redemption after a foreclosure sale, if any. In that event, there could be a default in payments of the principal of and interest on the 2024 Bonds. Further development of property in Improvement Area No. 1 may not occur as currently proposed or at all. See “PROPERTY OWNER AND DEVELOPMENT STATUS” herein for information regarding property ownership and the status of development in Improvement Area No. 1. See also “– Depletion of 2024 Reserve Fund” below.

Levy and Collection of the Facilities Special Tax

General. The principal source of payment of principal of and interest on the 2024 Bonds is the proceeds of the annual levy and collection of the Facilities Special Tax against property within Improvement Area No. 1.

Limitation on Maximum Facilities Special Tax Rate. The annual levy of the Facilities Special Tax is subject to the maximum annual Facilities Special Tax rate authorized in the Amended Rate and Method. The levy cannot be made at a higher rate even if the failure to do so means that the estimated proceeds of the levy and collection of the Facilities Special Tax, together with other available funds, will not be sufficient to pay Debt Service on the 2024 Bonds.

No Relationship Between Property Value and Facilities Special Tax Levy. Because the Facilities Special Tax formula set forth in the Amended Rate and Method is not based on property value, the levy of the Facilities Special Tax will rarely, if ever, result in a uniform relationship between the value of particular parcels of Taxable Property and the amount of the levy of the Facilities Special Tax against those parcels. Thus, there will rarely, if ever, be a uniform relationship between the value of the parcels of Taxable Property and their proportionate share of Debt Service on the 2024 Bonds, and certainly not a direct relationship.

Factors that Could Lead to Facilities Special Tax Deficiencies. The following are some of the factors that might cause the levy of the Facilities Special Tax on any particular parcel of Taxable Property to vary from the Facilities Special Tax that might otherwise be expected:

Transfers to Governmental Entities. The number of parcels of Taxable Property could be reduced through the acquisition of Taxable Property by a governmental entity and failure of the government to pay the Facilities Special Tax based upon a claim of exemption or, in the case of the federal government or an agency thereof, immunity from taxation, thereby resulting in an increased tax burden on the remaining taxed parcels. See “– Exempt Properties” below.

Property Tax Delinquencies. Failure of the owners of Taxable Property to pay property taxes (and, consequently, the Facilities Special Tax), or delays in the collection of or inability to collect the Facilities Special Tax by tax sale or foreclosure and sale of the delinquent parcels, could result in a deficiency in the collection of Facilities Special Taxes.

See “– Property Tax Delinquencies” below.

Delays Following Facilities Special Tax Delinquencies and Foreclosure Sales. The Fiscal Agent Agreement generally provides that the Facilities Special Tax is to be collected in the same manner as ordinary ad valorem property taxes are collected and, except as provided in the Packet Page 288 of 530Attachment 3 Page 75 of 129

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special covenant for foreclosure described in “SECURITY FOR THE 2024 BONDS – Covenant to Foreclose” and in the Act, is subject to the same penalties and the same procedure, sale and lien priority in case of delinquency as is provided for ordinary ad valorem property taxes. Under these procedures, if taxes are unpaid for a period of five years or more, the property is deeded to the State and then is subject to sale by the County.

If sales or foreclosures of property are necessary, there could be a delay in payments to owners of the 2024 Bonds pending such sales or the prosecution of foreclosure proceedings and receipt by the District of the proceeds of sale if the 2024 Reserve Fund is depleted. See “SECURITY FOR THE 2024 BONDS – Covenant to Foreclose.”

The ability of the City to collect interest and penalties specified by State law and to foreclose against properties having delinquent Facilities Special Tax installments may be limited in certain respects with regard to properties in which a federal governmental agency has or obtains an interest. See “– FDIC/Federal Government Interests in Properties” below.

Other laws generally affecting creditors’ rights or relating to judicial foreclosure may affect the ability to enforce payment of Facilities Special Taxes or the timing of enforcement of Facilities Special Taxes. For example, the Soldiers and Sailors Civil Relief Act of 1940 affords protections such as a stay in enforcement of the foreclosure covenant, a six-month period after termination of military service to redeem property sold to enforce the collection of a tax or assessment, and a limitation on the interest rate on the delinquent tax or assessment to persons in military service if the court concludes the ability to pay such taxes or assessments is materially affected by reason of such service.

Property Tax Delinquencies

General. Delinquencies in the payment of property taxes and, consequently, the Facilities Special Taxes, can occur because the owners of delinquent parcels may not have received property tax bills from the County in a timely manner, including situations in which the County initially sent property tax bills to the property developer or merchant builder at a time when the parcels in question had already been sold to individual homeowners. Delinquencies can also reflect economic difficulties and duress by the property owner.

Numerous future delinquencies by the owners of Taxable Property in Improvement Area No. 1 in the payment of property taxes (and, consequently, the Facilities Special Taxes, which are collected on the ordinary property tax bills) when due could result in a deficiency in Facilities Special Tax revenues necessary to pay Debt Service on the 2024 Bonds, which could in turn result in the depletion of the 2024 Reserve Fund, prior to reimbursement from the resale of foreclosed property or payment of the delinquent Facilities Special Tax. See “SECURITY FOR THE 2024 BONDS – 2024 Reserve Fund,” and “THE DISTRICT AND IMPROVEMENT AREA NO. 1 – Potential Consequences of Facilities Special Tax Delinquencies.”

Measures to Mitigate Consequences of Continuing Delinquencies. The City intends to take certain actions designed to mitigate the impact of future delinquencies, including: enforcing the lien of the Facilities Special Taxes through collection procedures that will include foreclosure actions under certain circumstances (see “SECURITY FOR THE 2024 BONDS – Covenant to Foreclose”); and increasing the levy of Facilities Special Taxes against non-delinquent property owners in Improvement Area No. 1, to the extent permitted under the Amended Rate and Method and the Act and to the extent the Facilities Special Taxes are not already being levied at the maximum Facilities Special Tax rate. See “THE DISTRICT AND IMPROVEMENT AREA NO. 1 – Potential Consequences of Facilities Special Tax Delinquencies.”

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Limitations on Increases in Facilities Special Tax Levy. If property owners are delinquent in the payment of the Facilities Special Tax, the City may not increase Facilities Special Tax levies to make up for delinquencies for prior fiscal years above the maximum annual Facilities Special Tax rates specified in the Amended Rate and Method.

In addition, the City’s ability to increase Facilities Special Tax levies on residential property to make up for delinquencies for prior Fiscal Years is limited by Section 53321(d) of the Act, which provides that the special tax levied against any parcel for which an occupancy permit for private residential use has been issued may not be increased as a consequence of delinquency or default by the owner of any other parcel by more than 10% above the amount that would have been levied in such Fiscal Year had there never been any such delinquencies or defaults.

In cases of significant delinquency, these factors may result in defaults in the payment of principal of and interest on the 2024 Bonds.

Future Property Development

Continuing development of the parcels in Improvement Area No. 1 may be adversely affected by changes in general or local economic conditions, fluctuations in or a deterioration of the real estate market, increased construction costs, development, financing and marketing capabilities of the developer, water or electricity shortages, discovery on the undeveloped property of any plants or animals in their habitat that have been listed as endangered species, changes in laws, and other factors outside the control of the owners of land in Improvement Area No. 1. The timing of development in Improvement Area No. 1 may also be affected by the conditions of approval for development.

Development in Improvement Area No. 1 may also be affected by development in surrounding areas, which may compete with the property in Improvement Area No. 1.

Value to Lien Ratios

Appraised value-to-lien ratios have traditionally been used in land-secured bond issues as a measure of the “collateral” supporting the willingness of property owners to pay their special taxes and assessments (and, in effect, their general property taxes as well). The value-to-lien ratio is mathematically a fraction, the numerator of which is the value of the property as measured by assessed values or appraised values (in this case, the appraised value of taxable property within Improvement Area No. 1 as of the August 28, 2024, date of value of the Appraisal) and the denominator of which is the “lien” of the allocable share of assessment or special tax bonds. A value to lien ratio should not, however, be viewed as a guarantee for credit-worthiness. Land values are sensitive to economic cycles. Assessed values may not reflect the current market value of property. A downturn of the economy or other market factors may depress land values and lower the value-to-lien ratios. Although judicial foreclosure proceedings can be initiated rapidly, the process can take several years to complete, and the bankruptcy courts may impede the foreclosure action. No assurance can be given that, should a parcel with delinquent Facilities Special Taxes be foreclosed upon and sold for the amount of the delinquency, any bid will be received for such property or, if a bid is received, that such bid will be sufficient to pay all delinquent Facilities Special Taxes. Finally, local agencies may form overlapping community facilities districts or assessment districts. Local agencies typically do not coordinate their bond issuances. Debt issuance by another entity could dilute value to lien ratios.

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Risks Related to Homeowners with High Loan to Value Ratios

Any future decline in home values in Improvement Area No. 1 could result in property owner unwillingness or inability to pay mortgage payments, as well as ad valorem property taxes and Facilities Special Taxes, when due. Under such circumstances, bankruptcies are likely to increase. Bankruptcy by homeowners with delinquent Facilities Special Taxes would delay the commencement and completion of foreclosure proceedings to collect delinquent Facilities Special Taxes.

It is possible that laws could be enacted in the future to assist homeowners in default in the payment of mortgages and property taxes. It is further possible that federal laws could be enacted that would adversely impact the ability of the City to foreclose on parcels with delinquent Facilities Special Taxes. No assurance can be given that any such laws will be enacted, or if enacted will be effective in assisting affected homeowners.

Payment of Facilities Special Tax is not a Personal Obligation of the Property Owners

An owner of Taxable Property is not personally obligated to pay the Facilities Special Taxes. Rather, the Facilities Special Taxes are an obligation running only against the parcels of Taxable Property. If, after a default in the payment of the Facilities Special Tax and a foreclosure sale by the City, the resulting proceeds are insufficient, taking into account other obligations also constituting a lien against the affected parcels of Taxable Property, the City has no recourse against the owner.

Appraised Values

The Appraisal set forth in Appendix H estimates the market value of the Taxable Property within Improvement Area No. 1. This market value is merely the opinion of the Appraiser as of the date of value set forth in the Appraisal, and is subject to the assumptions and limiting conditions stated in the Appraisal. The City has not sought an updated opinion of value by the Appraiser subsequent to the date of value of the Appraisal, or an opinion of the value of the Taxable Property by any other appraiser. A different opinion of value might be rendered by a different appraiser.

The opinion of value assumes a sale by a willing seller to a willing buyer, each having similar information and neither being forced by other circumstances to sell or to buy.

Consequently, the opinion is of limited use in predicting the selling price at a foreclosure sale, because the sale is forced and the buyer may not have the benefit of full information.

In addition, the opinion of value is made as of the date of value set forth in the Appraisal, based upon facts and circumstances existing as of the date of value. Differing facts and circumstances may lead to differing opinions of value. The appraised value is not evidence of future value because future facts and circumstances may differ significantly from the facts and circumstances at the time the Appraisal was prepared.

No assurance can be given that any of the Taxable Property in Improvement Area No. 1 could be sold for the estimated market value contained in the Appraisal if that property should become delinquent in the payment of Facilities Special Taxes and be foreclosed upon.

Property Values

The value of Taxable Property within Improvement Area No. 1 is a critical factor in determining the investment quality of the 2024 Bonds. If a property owner defaults in the payment of the Facilities Special Tax, the City’s only remedy is to foreclose on the delinquent property in Packet Page 291 of 530Attachment 3 Page 78 of 129

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an attempt to obtain funds with which to pay the delinquent Facilities Special Tax. Land values could be adversely affected by economic and other factors beyond the City’s control, such as a general economic downturn, relocation of employers out of the area, shortages of water, electricity, natural gas or other utilities, destruction of property caused by earthquake, flood, landslides, wildfires, or other natural disasters, environmental pollution or contamination, public health emergencies, such as the COVID-19 pandemic, or unfavorable economic conditions.

The following is a discussion of specific risk factors that could affect the value of property in Improvement Area No. 1.

Prolonged Economic Downturn. Land values are affected by economic conditions and to the extent that an economic downturn is prolonged, property values could decline or remain flat for an indefinite period. Declines in home values in Improvement Area No. 2 could also result in property owner unwillingness or inability to pay mortgage payments, as well as ad valorem property taxes and Special Taxes, when due. Under such circumstances, bankruptcies are likely to increase. Bankruptcy by homeowners with delinquent Special Taxes would delay the commencement and completion of foreclosure proceedings.

Natural Disasters. The value of the Taxable Property in the future can be adversely affected by a variety of natural occurrences, particularly those that may affect infrastructure and other public improvements and private improvements on the Taxable Property and the continued habitability and enjoyment of such private improvements.

The City, like all northern California communities, is likely to be subject to unpredictable seismic activity, fires, floods or other natural disasters. If there were a severe seismic, flood or fire event or other natural disaster in the City, there could be substantial damage to and interference with the City.

Seismic Activity. The City is located along the eastern edge of the seismically active Coast Ranges of California. Active faults near the City include the Green Valley and Cordelia faults. Most large earthquakes in the Bay Area have occurred along the major faults including the San Andreas, Hayward, and Calaveras faults, which are located 20 to 45 miles west and south of the City.

The closest mapped fault to Improvement Area No. 1 is the Vaca fault zone (not considered active), located within approximately 500 feet of the northwest corner of the project site. The closest active fault displaying surface expression is the Green Valley fault, located approximately 8 miles west of Improvement Area No. 1. The maximum magnitude earthquake (the “Mmax”) assumed for the Green Valley fault in this region is 6.8. The Mmax is the maximum earthquake believed possible for the fault.

Flooding Hazards. The District is located in an area of minimal flooding according to FEMA. In particular, Improvement Area No. 1 is located in an area designated by FEMA as being within Zone X, with a 0.02% chance of flooding in any given year.

Wildfire Hazards. Significant portions of the foothill watershed areas surrounding the City are threatened with wildfire risk, and these areas present a dangerous combination of factors. “Extreme Wildfire Risk Areas,” are those lands where severe burning conditions prevail (chaparral and heavy woodland, steep slopes, poor access, winds). In the City, this includes the hilly areas to the west and northwest, the Cement Hill area, the hills above Green Valley and the hills above Interstate 80 and 680 just south of Cordelia.

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Drought. With respect to droughts specifically, California has a history of suffering periodic drought conditions. Most recently, on May 10, 2021, the governor proclaimed a State of Emergency for 41 of the State’s 58 counties (including Solano County), citing above-average temperatures and dry conditions. In April 2022, the governor extended the State of Emergency to all counties in the State and asked all Californians to voluntarily reduce water usage by 15%. While some drought-related water restrictions were eased in May 2023, no assurance can be given that drought conditions will not continue in future years or, subside only to return in the future, potentially impacting the development of property in Improvement Area No. 1, the value of Taxable Property within Improvement Area No. 1, or economic activity within Improvement Area No. 1.

Legal Requirements. Other events that may affect the value of Taxable Property include changes in the law or application of the law. Such changes may include, without limitation, local growth control initiatives, local utility connection moratoriums and local application of statewide tax and governmental spending limitation measures.

Hazardous Substances. One of the most serious risks in terms of the potential reduction in the value of Taxable Property is a claim with regard to a hazardous substance.

In general, the owners and operators of Taxable Property may be required by law to remedy conditions of the parcel 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 “Superfund 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. Under many of these laws, the owner or operator is obligated to remedy a hazardous substance condition of property whether or not the owner or operator has anything to do with creating or handling the hazardous substance. The effect, therefore, should any of the Taxable Property be affected by a hazardous substance, is to reduce the marketability and value of the parcel by the costs of remedying the condition, because the purchaser, upon becoming owner, will become obligated to remedy the condition just as is the seller.

The property values set forth in this Official Statement do not take into account the possible reduction in marketability and value of any of the Taxable Property by reason of the possible liability of the owner or operator for the remedy of a hazardous substance condition of the parcel. Although the City is not aware that the owner or operator of any of the Taxable Property has such a current liability with respect to any of the Taxable Property, it is possible that such liabilities do currently exist and that the City is not aware of them.

Further, it is possible that liabilities may arise in the future with respect to any of the Taxable Property resulting from the existence, currently, on the parcel of a substance presently classified as hazardous but that has not been released or the release of which is not presently threatened, or may arise in the future resulting from the existence, currently on the parcel of a substance not presently classified as hazardous but that may in the future be so classified. Further, such liabilities may arise not simply from the existence of a hazardous substance but from the method of handling it. All of these possibilities could significantly affect the value of Taxable Property that is realizable upon a delinquency.

There can be no assurance that the discovery, release or classification of additional hazardous substances will not affect the value of Taxable Property in Improvement Area No. 1.

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Mortgage Interest Rates. Future increases in mortgage interest rates could have a negative impact on the estimated absorption rates of the residential units in Improvement Area No. 1 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, in such instances, a new home would likely have a higher interest rate on a new mortgage loan as well as a higher purchase price and property taxes. Such considerations may decrease the desire for move-up households to purchase a new home. The foregoing factors could reduce demand for or the ability to achieve the sales prices of the planned for-sale homes within Improvement Area No. 1 as described herein.

Other Factors. Other factors that could adversely affect property values in Improvement Area No. 1 include, among others, relocation of employers out of the area, shortages of water, electricity, natural gas or other utilities, and destruction of property caused by man-made disasters.

Other Possible Claims Upon the Value of Taxable Property

While the Facilities Special Taxes are secured by the Taxable Property, the security only extends to the value of such Taxable Property that is not subject to priority and parity liens and similar claims.

The tables in the sections entitled “THE DISTRICT AND IMPROVEMENT AREA NO. 1 – Direct and Overlapping Governmental Obligations” and “– Estimated Tax Burden on Single- Family Homes” show the presently outstanding amount of governmental obligations, the tax or assessment for which is or may become an obligation of one or more of the parcels of Taxable Property. The tables do not specifically identify which of the governmental obligations are secured by liens on one or more of the parcels of Taxable Property.

In addition, other governmental obligations may be authorized and undertaken or issued in the future, the tax, assessment or charge for which may become an obligation of one or more of the parcels of Taxable Property and may be secured by a lien on a parity with the lien of the Facilities Special Tax securing the 2024 Bonds.

In general, as long as the Facilities Special Tax is collected on the County tax roll, the Facilities Special Tax and all other taxes, assessments and charges also collected on the tax roll are on a parity, that is, are of equal priority. Questions of priority become significant when collection of one or more of the taxes, assessments or charges is sought by some other procedure, such as foreclosure and sale. In the event of proceedings to foreclose for delinquency of Facilities Special Taxes securing the 2024 Bonds, the Facilities Special Tax will be subordinate only to existing prior governmental liens, if any. Otherwise, in the event of such foreclosure proceedings, the Facilities Special Taxes will generally be on a parity with the other taxes, assessments and charges, and will share the proceeds of such foreclosure proceedings on a pro- rata basis. Although the Facilities Special Taxes will generally have priority over non- governmental liens on a parcel of Taxable Property, regardless of whether the non-governmental liens were in existence at the time of the levy of the Facilities Special Tax or not, this result may not apply in the case of bankruptcy. See “– Bankruptcy Delays” below.

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Exempt Properties

Certain properties are exempt from the Facilities Special Tax in accordance with the Amended Rate and Method and the Act, which provides that properties or entities of the state, federal or local government are exempt from the Facilities Special Tax; provided, however, that property within Improvement Area No. 1 acquired by a public entity through a negotiated transaction or by gift or devise, which is not otherwise exempt from the Facilities Special Tax, will continue to be subject to the Facilities Special Tax. See “SECURITY FOR THE 2024 BONDS – Amended Rate and Method.”

In addition, although the Act provides that if property subject to the Facilities Special Tax is acquired by a public entity through eminent domain proceedings, the obligation to pay the Facilities Special Tax with respect to that property is to be treated as if it were a special assessment, the constitutionality and operation of these provisions of the Act have not been tested, meaning that such property could become exempt from the Facilities Special Tax.

For ordinances levying special taxes that are adopted after January 1, 2020, Section 53340(c) of the Act also provides that:

“a property receiving a welfare exemption under subdivision (g) of Section 214 of the Revenue and Taxation Code shall be exempt from the special tax unless debt is outstanding and the property was subject to the special tax prior to receiving the exemption, in which case the property shall remain subject to the special tax and the special tax shall be enforceable against the property. However, whether or not the resolution of formation that authorized creation of the district specified conditions under which the obligation to pay a special tax may be prepaid and permanently satisfied, the legislative body of the local agency that created the district may, by resolution, specify additional or different conditions under which the property receiving the welfare exemption may prepay and satisfy the obligation to pay the special tax. The conditions may be specified only if the legislative body of the local agency that created the district finds and determines that the prepayment arrangement will not, in and of itself, adversely affect the ability of the district to make scheduled payments on debt as such payments become due.”

Because the Ordinance levying the Facilities Special Taxes within Improvement Area No. 1 was adopted after January 1, 2020, the foregoing is applicable to Improvement Area No. 1. See “SECURITY FOR THE 2024 BONDS – Amended Rate and Method" and APPENDIX B for a discussion of the treatment of welfare exemption property.

The Act further provides that no other properties or entities are exempt from the Facilities Special Tax unless the properties or entities are expressly exempted in a resolution of consideration to levy a new special tax or to alter the rate or method of apportionment of an existing special tax.

FDIC/Federal Government Interests in Properties

General. The ability of the City to foreclose the lien of delinquent unpaid Facilities Special Tax installments may be limited with regard to properties in which the FDIC, the Federal National Mortgage Association, the Drug Enforcement Agency, the Internal Revenue Service, or other federal agency has or obtains an interest.

Federal courts have held that, based on the supremacy clause of the United States Constitution, in the absence of Congressional intent to the contrary, a state or local agency cannot Packet Page 295 of 530Attachment 3 Page 82 of 129

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foreclose to collect delinquent taxes or assessments if foreclosure would impair the federal government interest.

The supremacy clause of the United States Constitution reads as follows: “This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the contrary notwithstanding.”

This means that, unless Congress has otherwise provided, if a federal governmental entity owns a parcel that is subject to Facilities Special Taxes but does not pay taxes and assessments levied on the parcel (including Facilities Special Taxes), the applicable state and local governments cannot foreclose on the parcel to collect the delinquent taxes and assessments.

Moreover, unless Congress has otherwise provided, if the federal government has a mortgage interest in the parcel and the City wishes to foreclose on the parcel as a result of delinquent Facilities Special Taxes, the property cannot be sold at a foreclosure sale unless it can be sold for an amount sufficient to pay delinquent taxes and assessments on a parity with the Facilities Special Taxes and preserve the federal government’s mortgage interest. In Rust v.

Johnson (9th Circuit; 1979) 597 F.2d 174, the United States Court of Appeal, Ninth Circuit held that the Federal National Mortgage Association (“FNMA”) is a federal instrumentality for purposes of this doctrine, and not a private entity, and that, as a result, an exercise of state power over a mortgage interest held by FNMA constitutes an exercise of state power over property of the United States.

The City has not undertaken to determine whether any federal governmental entity currently has, or is likely to acquire, any interest (including a mortgage interest) in any of the parcels subject to the Facilities Special Taxes, and therefore expresses no view concerning the likelihood that the risks described above will materialize while the 2024 Bonds are outstanding.

FDIC. In the event that any financial institution making any loan which is secured by real property within Improvement Area No. 1 is taken over by the FDIC, and prior thereto or thereafter the loan or loans go into default, resulting in ownership of the property by the FDIC, then the ability of the City to collect interest and penalties specified by State law and to foreclose the lien of delinquent unpaid Facilities Special Taxes may be limited.

The FDIC’s policy statement regarding the payment of state and local real property taxes (the “Policy Statement”) provides that property owned by the FDIC is subject to state and local real property taxes only if those taxes are assessed according to the property’s value, and that the FDIC is immune from real property taxes assessed on any basis other than property value.

According to the Policy Statement, the FDIC will pay its property tax obligations when they become due and payable and will pay claims for delinquent property taxes as promptly as is consistent with sound business practice and the orderly administration of the institution’s affairs, unless abandonment of the FDIC’s interest in the property is appropriate. The FDIC will pay claims for interest on delinquent property taxes owed at the rate provided under state law, to the extent the interest payment obligation is secured by a valid lien. The FDIC will not pay any amounts in the nature of fines or penalties and will not pay nor recognize liens for such amounts.

If any property taxes (including interest) on FDIC-owned property are secured by a valid lien (in effect before the property became owned by the FDIC), the FDIC will pay those claims. The Policy Statement further provides that no property of the FDIC is subject to levy, attachment, garnishment, foreclosure or sale without the FDIC’s consent. In addition, the FDIC will not permit a lien or security interest held by the FDIC to be eliminated by foreclosure without the FDIC’s consent.

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The Policy Statement states that the FDIC generally will not pay non-ad valorem taxes, including special assessments, on property in which it has a fee interest unless the amount of tax is fixed at the time that the FDIC acquires its fee interest in the property, nor will it recognize the validity of any lien to the extent it purports to secure the payment of any such amounts. Special taxes imposed under the Act and a special tax formula which determines the special tax due each year are specifically identified in the Policy Statement as being imposed each year and therefore covered by the FDIC’s federal immunity. The Ninth Circuit has issued a ruling on August 28, 2001 in which it determined that the FDIC, as a federal agency, is exempt from Mello-Roos special taxes.

The City is unable to predict what effect the application of the Policy Statement would have in the event of a delinquency in the payment of Facilities Special Taxes on a parcel within Improvement Area No. 1 in which the FDIC has or obtains an interest, although prohibiting the lien of the Facilities Special Taxes to be foreclosed out at a judicial foreclosure sale could reduce or eliminate the number of persons willing to purchase a parcel at a foreclosure sale. Such an outcome could cause a draw on the 2024 Reserve Fund and perhaps, ultimately, if enough property were to become owned by the FDIC, a default in payment on the 2024 Bonds.

Depletion of 2024 Reserve Fund

The 2024 Reserve Fund is to be maintained at an amount equal to the 2024 Reserve Requirement for the 2024 Bonds and any additional 2024-Related Parity Bonds. See “SECURITY FOR THE 2024 BONDS – 2024 Reserve Fund.” The 2024 Reserve Fund will be used to pay principal of and interest on the 2024 Bonds and any other 2024-Related Parity Bonds issued in the future if insufficient funds are available from the proceeds of the levy and collection of the Facilities Special Tax against property within Improvement Area No. 1 of the District. If the 2024 Reserve Fund is depleted, it can be replenished from the proceeds of the levy and collection of the Facilities Special Taxes that exceed the amounts to be paid to the owners of the 2024 Bonds and any other 2024-Related Parity Bonds issued in the future under the Fiscal Agent Agreement.

However, because the Facilities Special Tax levy is limited to the maximum annual Facilities Special Tax rates, it is possible that no replenishment would be possible if the Facilities Special Tax proceeds, together with other available funds, remain insufficient to pay all such amounts.

Thus, it is possible that the 2024 Reserve Fund will be depleted and not be replenished by the levy and collection of the Facilities Special Taxes.

Bankruptcy Delays

The payment of the Facilities Special Tax and the ability of the City to foreclose the lien of a delinquent unpaid Facilities Special Tax, as discussed in “SECURITY FOR THE 2024 BONDS,” may be limited by bankruptcy, insolvency or other laws generally affecting creditors' rights or by the laws of the State of California relating to judicial foreclosure. The various legal opinions to be delivered concurrently with the delivery of the 2024 Bonds (including Bond Counsel's approving legal opinion) will be qualified as to the enforceability of the various legal instruments by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights, by the application of equitable principles and by the exercise of judicial discretion in appropriate cases.

Although bankruptcy proceedings would not cause the Facilities Special Taxes to become extinguished, bankruptcy of a property owner or any other person claiming an interest in the property could result in a delay in superior court foreclosure proceedings and could result in the possibility of Facilities Special Tax installments not being paid in part or in full. Such a delay Packet Page 297 of 530Attachment 3 Page 84 of 129

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would increase the likelihood of a delay or default in payment of the principal of and interest on the 2024 Bonds.

In addition, the amount of any lien on property securing the payment of delinquent Facilities Special Taxes could be reduced if the value of the property were determined by the bankruptcy court to have become less than the amount of the lien, and the amount of the delinquent Facilities Special Taxes in excess of the reduced lien could then be treated as an unsecured claim by the court. Any such stay of the enforcement of the lien for the Facilities Special Tax, or any such delay or non-payment, would increase the likelihood of a delay or default in payment of the principal of and interest on the 2024 Bonds and the possibility of delinquent Facilities Special Taxes not being paid in full.

The chances are increased that the 2024 Reserve Fund established for the 2024 Bonds and any other 2024-Related Parity Bonds issued in the future could be fully depleted during any such delay in obtaining payment of delinquent Facilities Special Taxes. As a result, sufficient moneys would not be available in the 2024 Reserve Fund to make up shortfalls resulting from delinquent payments of the Facilities Special Tax and thereby to pay principal of and interest on the 2024 Bonds and any other 2024-Related Parity Bonds issued in the future on a timely basis.

Cyber Security

The City, like many other public and private entities, relies on computer and other digital networks and systems to conduct its operations. As a recipient and provider of personal, private or other sensitive electronic information, the City is potentially subject to multiple cyber threats, including without limitation hacking, viruses, ransomware, malware and other attacks. No assurance can be given that the City’s efforts to manage cyber threats and attacks will be successful in all cases, or that any such attack will not materially impact the operations or finances of the City or the District, or the administration of the 2024 Bonds. The City is also reliant on other entities and service providers in connection with the administration of the 2024 Bonds, including without limitation the County tax collector for the levy and collection of Facilities Special Taxes, the Fiscal Agent, and the Dissemination Agent. No assurance can be given that the City, the District and these other entities will not be affected by cyber threats and attacks in a manner that may affect the Bond owners.

Disclosure to Future Purchasers

The City has recorded a notice of the Facilities Special Tax lien in the Office of the County Recorder. While title companies normally refer to such notices in title reports, there can be no guarantee that such reference will be made or, if made, that a prospective purchaser or lender will consider such special tax obligation in the purchase of a parcel of land or a home in Improvement Area No. 1 or the lending of money secured by property in Improvement Area No.

1. The Act and the Goals and Policies of the City require the subdivider of a subdivision (or its agent or representative) to notify a prospective purchaser or long-term lessor of any lot, parcel, or unit subject to a Mello-Roos special tax of the existence and maximum amount of such special tax using a statutorily prescribed form. California Civil Code Section 1102.6b requires that in the case of transfers other than those covered by the above requirement, the seller must at least make a good faith effort to notify the prospective purchaser of the special tax lien in a format prescribed by statute. Failure by an owner of the property to comply with these requirements, or failure by a purchaser or lessor to consider or understand the nature and existence of the Facilities Special Tax, could adversely affect the willingness and ability of the purchaser or lessor to pay the Facilities Special Tax when due.

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Public Health Emergencies

In recent years, public health authorities have warned of threats posed by outbreaks of disease and other public health threats. Pandemic diseases arising in the future could have significant adverse health and financial impacts throughout the world, leading to loss of jobs and personal financial hardships, and/or actions by federal, State and local governmental authorities to contain or mitigate the effects of an outbreak.

Taxpayer assistance measures may include deferral of due dates of property taxes, which was an assistance program during the COVID-19 pandemic, and with or without a deferral some taxpayers may be unable to make their property and Facilities Special Tax payments. No assurance can be given that the property tax payment dates will not be deferred in the future, which may cause a delay in the receipt of Facilities Special Taxes. In addition, home values may be affected by a reduction in demand stemming from personal finances, or general widespread economic circumstances resulting from pandemic diseases.

No Acceleration Provisions

The 2024 Bonds do not contain a provision allowing for their acceleration in the event of a payment default or other default under the terms of the 2024 Bonds or the Fiscal Agent Agreement. Under the Fiscal Agent Agreement, a Bondholder is given the right for the equal benefit and protection of all Bond owners similarly situated to pursue certain remedies. See “APPENDIX C – SUMMARY OF CERTAIN PROVISIONS OF THE FISCAL AGENT AGREEMENT.” So long as the 2024 Bonds are in book-entry form, DTC will be the sole Bondholder and will be entitled to exercise all rights and remedies of Bond holders.

Loss of Tax Exemption

As discussed under the caption “LEGAL MATTERS – Tax Exemption,” interest on the 2024 Bonds might become includable in gross income for purposes of federal income taxation retroactive to the date the 2024 Bonds were issued as a result of future acts or omissions of the City in violation of its covenants in the Fiscal Agent Agreement. The Fiscal Agent Agreement does not contain a special redemption feature triggered by the occurrence of an event of taxability.

As a result, if interest on the 2024 Bonds were to become includable in gross income for purposes of federal income taxation, the 2024 Bonds would continue to remain outstanding until maturity unless earlier redeemed pursuant to optional or mandatory redemption or redemption upon prepayment of the Facilities Special Taxes. See “THE 2024 BONDS – Redemption.”

IRS Audit of Tax-Exempt Bond Issues

The Internal Revenue Service (the “IRS”) has a program for the auditing of tax-exempt bond issues, including both random and targeted audits. It is possible that the 2024 Bonds will be selected for audit by the IRS. It is also possible that the market value of such 2024 Bonds might be affected as a result of such an audit of such 2024 Bonds (or by an audit of similar bonds or securities).

Impact of Legislative Proposals, Clarifications of the Code and Court Decisions on Tax Exemption

Future legislative proposals, if enacted into law, clarification of the Tax Code or court decisions may cause interest on the 2024 Bonds to be subject, directly or indirectly, to federal income taxation or to be subject to or exempted from state income taxation, or otherwise prevent Bondowners from realizing the full current benefit of the tax status of such interest.

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Voter Initiatives

Under the California Constitution, the power of initiative is reserved to the voters for the purpose of enacting statutes and constitutional amendments. Since 1978, the voters have exercised this power through the adoption of Proposition 13 and similar measures, including Proposition 218, which was approved in the general election held on November 5, 1996, and Proposition 26, which was approved on November 2, 2010.

Any such initiative may affect the collection of fees, taxes and other types of revenue by local agencies such as the City. Subject to overriding federal constitutional principles, such collection may be materially and adversely affected by voter-approved initiatives, possibly to the extent of creating cash-flow problems in the payment of outstanding obligations such as the 2024 Bonds.

Proposition 218—Voter Approval for Local Government Taxes—Limitation on Fees, Assessments, and Charges—Initiative Constitutional Amendment, added Articles XIIIC and XIIID to the California Constitution, imposing certain vote requirements and other limitations on the imposition of new or increased taxes, assessments and property-related fees and charges.

On November 2, 2010, California voters approved Proposition 26, entitled the “Supermajority Vote to Pass New Taxes and Fees Act”. Section 1 of Proposition 26 declares that Proposition 26 is intended to limit the ability of the State Legislature and local government to circumvent existing restrictions on increasing taxes by defining the new or expanded taxes as “fees.” Proposition 26 amended Articles XIIIA and XIIIC of the State Constitution. The amendments to Article XIIIA limit the ability of the State Legislature to impose higher taxes (as defined in Proposition 26) without a two-thirds vote of the Legislature. Article XIIIC requires that all new local taxes be submitted to the electorate before they become effective. Taxes for general governmental purposes require a majority vote and taxes for specific purposes (“special taxes”) require a two-thirds vote.

The Facilities Special Taxes and the 2024 Bonds were each authorized by not less than a two-thirds vote of the landowners within Improvement Area No. 1 of the District who constituted the qualified electors at the time of such voted authorization. The City believes, therefore, that issuance of the 2024 Bonds does not require the conduct of further proceedings under the Act, Proposition 218 or Proposition 26.

Like their antecedents, Proposition 218 and Proposition 26 are likely to undergo both judicial and legislative scrutiny before the impact on the City and its obligations can be determined.

Certain provisions of Proposition 218 and Proposition 26 may be examined by the courts for their constitutionality under both State and federal constitutional law, the outcome of which cannot be predicted.

For example, in August 2014, the California Court of Appeal, Fourth Appellate District, Division One (the “Court”), issued its opinion in City of San Diego v. Melvin Shapiro, et al. (“Shapiro”) invalidating an election held by the City of San Diego to authorize the levying of special taxes on hotels city-wide pursuant to a city charter ordinance creating a convention center facilities district which specifically defined the electorate to consist solely of (1) the owners of real property in the city on which a hotel is located, and (2) the lessees of real property owned by a governmental entity on which a hotel is located. The court held that such landowners and lessees are neither “qualified electors” of the city for purposes of Articles XIII A, Section 4 of the California Constitution, nor a proper “electorate” under Article XIIIC, Section 2(d) of the California Constitution. The court specifically noted that the decision did not require the Court to consider the distinct question of whether landowner voting to impose special taxes under Section 53326(b) Packet Page 300 of 530Attachment 3 Page 87 of 129

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of the Act (which was the nature of the voter approval through which the District and Improvement Area No. 1 were formed) violates the California Constitution in districts that lack sufficient registered voters to conduct an election among registered voters. Accordingly, Shapiro should have no effect on the levy of the Facilities Special Taxes by the City because the District had no registered voters at the time of its formation.

The City cannot predict the ultimate outcome or effect of any such judicial scrutiny, legislative actions, or future initiatives. These initiatives, and any future initiatives, may affect the collection of fees, taxes and other types of revenue by local agencies such as the City. Subject to overriding federal constitutional principles, such collection may be materially and adversely affected by voter-approved initiatives, possibly to the extent of creating cash-flow problems in the payment of outstanding obligations such as the 2024 Bonds.

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No Ratings – Limited Secondary Market for Bonds

The City has not applied to have the 2024 Bonds rated by any nationally recognized bond rating company, and it does not expect to do so in the future. There can be no guarantee that there will be a secondary market for the 2024 Bonds or, if a secondary market exists, that any 2024 Bonds can be sold for any particular price.

Although the City has committed to provide certain financial and operating information, there can be no assurance that such information will be available to Bondowners on a timely basis. The failure to provide the required annual financial information does not give rise to monetary damages but merely an action for specific performance. Occasionally, because of general market conditions, lack of current information, the absence of a credit rating for the 2024 Bonds or because of adverse history or economic prospects connected with a particular issue, secondary marketing practices in connection with a particular issue are suspended or terminated.

Additionally, prices of issues for which a market is being made will depend upon then prevailing circumstances. Such prices could be substantially different from the original purchase price.

No assurance can be given that the market price for the 2024 Bonds will not be affected by the introduction or enactment of any future legislation (including without limitation amendments to the Tax Code), or changes in interpretation of the Tax Code, or any action of the IRS, including but not limited to the publication of proposed or final regulations, the issuance of rulings, the selection of the 2024 Bonds for audit examination, or the course or result of any IRS audit or examination of the 2024 Bonds or obligations that present similar tax issues as the 2024 Bonds.

LEGAL MATTERS

Legal Opinions

The legal opinion of Jones Hall, A Professional Law Corporation, San Francisco, California, Bond Counsel, approving the validity of the 2024 Bonds will be made available to purchasers at the time of original delivery and is attached in substantially final form as Appendix G.

Jones Hall, A Professional Law Corporation, San Francisco, California, has also served as Disclosure Counsel to the City. Richards, Watson and Gershon, San Francisco, California, will pass upon certain legal matters for the City. Stradling Yocca Carlson & Rauth, a Professional Corporation, Newport Beach, California, is serving as counsel to the Underwriter. Holland & Knight LLP, San Francisco, California, is serving as counsel to One Lake Holding LLC, the Master Developer.

Tax Exemption

Federal Tax Status. In the opinion of Jones Hall, A Professional Law Corporation, San Francisco, California, Bond Counsel, subject, however to the qualifications set forth below, under existing law, the interest on the 2024 Bonds is excluded from gross income for federal income tax purposes, and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals; however, such interest on the 2024 Bonds may be taken into account for the purpose of computing the alternative minimum tax imposed on certain corporations.

The opinions set forth in the preceding paragraph are subject to the condition that the City comply with all requirements of the Internal Revenue Code of 1986, as amended (the “Tax Code”) that must be satisfied subsequent to the issuance of the 2024 Bonds in order that the interest Packet Page 302 of 530Attachment 3 Page 89 of 129

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thereon be, and continue to be, excludable from gross income for federal income tax purposes.

The City has made certain representations and covenants in order to comply with each such requirement. Inaccuracy of those representations, or failure to comply with certain of those covenants, may cause the inclusion of such interest in gross income for federal income tax purposes, which may be retroactive to the date of issuance of the 2024 Bonds.

Tax Treatment of Original Issue Discount and Premium. If the initial offering price to the public at which a 2024 Bond is sold is less than the amount payable at maturity thereof, then such difference constitutes "original issue discount" for purposes of federal income taxes and State of California personal income taxes. If the initial offering price to the public at which a 2024 Bond is sold is greater than the amount payable at maturity thereof, then such difference constitutes "bond premium" for purposes of federal income taxes and State of California personal income taxes.

Under the Tax Code, original issue discount is treated as interest excluded from federal gross income and exempt from State of California personal income taxes to the extent properly allocable to each owner thereof subject to the limitations described in the first paragraph of this section. The original issue discount accrues over the term to maturity of the 2024 Bond on the basis of a constant interest rate compounded on each interest or principal payment date (with straight-line interpolations between compounding dates). The amount of original issue discount accruing during each period is added to the adjusted basis of such 2024 Bonds to determine taxable gain upon disposition (including sale, redemption, or payment on maturity) of such 2024 Bond. The Tax Code contains certain provisions relating to the accrual of original issue discount in the case of purchasers of the 2024 Bonds who purchase the 2024 Bonds after the initial offering of a substantial amount of such maturity. Owners of such 2024 Bonds should consult their own tax advisors with respect to the tax consequences of ownership of 2024 Bonds with original issue discount, including the treatment of purchasers who do not purchase in the original offering to the public at the first price at which a substantial amount of such 2024 Bonds is sold to the public.

Under the Tax Code, bond premium is amortized on an annual basis over the term of the 2024 Bond (said term being the shorter of the 2024 Bond's maturity date or its call date). The amount of bond premium amortized each year reduces the adjusted basis of the owner of the 2024 Bond for purposes of determining taxable gain or loss upon disposition. The amount of bond premium on a 2024 Bond is amortized each year over the term to maturity of the 2024 Bond on the basis of a constant interest rate compounded on each interest or principal payment date (with straight-line interpolations between compounding dates). Amortized bond premium is not deductible for federal income tax purposes. Owners of premium 2024 Bonds, including purchasers who do not purchase in the original offering, should consult their own tax advisors with respect to State of California personal income tax and federal income tax consequences of owning such 2024 Bonds.

California Tax Status. In the further opinion of Bond Counsel, interest on the 2024 Bonds is exempt from California personal income taxes.

Other Tax Considerations. Current and future legislative proposals, if enacted into law, clarification of the Tax Code or court decisions may cause interest on the 2024 Bonds to be subject, directly or indirectly, to federal income taxation or to be subject to or exempted from state income taxation, or otherwise prevent beneficial owners from realizing the full current benefit of the tax status of such interest. The introduction or enactment of any such legislative proposals, clarification of the Tax Code or court decisions may also affect the market price for, or marketability of, the 2024 Bonds. It cannot be predicted whether or in what form any such proposal might be enacted or whether, if enacted, such legislation would apply to bonds issued prior to enactment.

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The opinions expressed by Bond Counsel are based upon existing legislation and regulations as interpreted by relevant judicial and regulatory authorities as of the date of such opinion, and Bond Counsel has expressed no opinion with respect to any proposed legislation or as to the tax treatment of interest on the 2024 Bonds, or as to the consequences of owning or receiving interest on the 2024 Bonds, as of any future date. Prospective purchasers of the 2024 Bonds should consult their own tax advisors regarding any pending or proposed federal or state tax legislation, regulations or litigation, as to which Bond Counsel expresses no opinion.

Owners of the 2024 Bonds should also be aware that the ownership or disposition of, or the accrual or receipt of interest on, the 2024 Bonds may have federal or state tax consequences other than as described above. Other than as expressly described above, Bond Counsel expresses no opinion regarding other federal or state tax consequences arising with respect to the 2024 Bonds, the ownership, sale or disposition of the 2024 Bonds, or the amount, accrual or receipt of interest on the 2024 Bonds.

No Litigation

At the time of delivery of the 2024 Bonds, the City will certify that there is no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, public board or body, pending with respect to which the City has been served with process or threatened, which:

• in any way questions the powers of the City Council or the City or the District, or

• in any way questions the validity of any proceeding taken by the City Council in connection with the issuance of the 2024 Bonds, or

• wherein an unfavorable decision, ruling or finding could materially adversely affect the transactions contemplated by the purchase contract with respect to the 2024 Bonds, or

• which, in any way, could adversely affect the validity or enforceability of the resolutions of the City Council adopted in connection with the formation of the District and Improvement Area No. 1 or the issuance of the 2024 Bonds, the Fiscal Agent Agreement, the Continuing Disclosure Certificate or the purchase contract with respect to the 2024 Bonds, or

• to the knowledge of the City, in any way questions the exclusion from gross income of the recipients thereof of the interest on the 2024 Bonds for federal income tax purposes, or

• in any other way questions the status of the 2024 Bonds under State tax laws or regulations.

CONTINUING DISCLOSURE

The City. The City will covenant for the benefit of owners of the 2024 Bonds to provide certain financial information and operating data relating to Improvement Area No. 1 and the 2024 Bonds by not later than nine months after the end of the City's fiscal year (currently March 31 based on the District’s fiscal year end of June 30) (the “Annual Report”), commencing March 31, 2025, and to provide notices of the occurrence of certain listed events.

These covenants have been made in order to assist the Underwriter in complying with Securities Exchange Commission Rule 15c2-12(b)(5) (the “Rule”). The specific nature of the Packet Page 304 of 530Attachment 3 Page 91 of 129

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information to be contained in the Annual Report or the notices of listed events is set forth in “APPENDIX E – FORM OF CITY CONTINUING DISCLOSURE CERTIFICATE.”

The City previously entered into numerous disclosure undertakings under the Rule in connection with the issuance of long-term obligations. The City has not failed to comply in all material aspects with any previous undertakings with regard to the Rule in the past five years. [TO BE CONFIRMED]

Any failure by the City to comply with the provisions of its undertaking will not constitute a default under the Fiscal Agent Agreement (although owners of the 2024 Bonds will have any remedy available at law or in equity as provided in the undertaking). Nevertheless, a failure to comply must be reported in accordance with the Rule. Such a failure may adversely affect the transferability and liquidity of the 2024 Bonds.

To ensure compliance with its continuing disclosure undertakings under the Rule in the future, the City has appointed the City’s Finance Director to coordinate the preparation and filing of annual disclosure reports in accordance with the City’s disclosure undertakings and has adopted policies and procedures related thereto. The City has also engaged Willdan Financial Services to serve as its dissemination agent and assist the City in complying with its continuing disclosure undertakings.

Master Developer. The Master Developer will covenant in a continuing disclosure certificate, the form of which is set forth in Appendix F to this Official Statement (the “Property Owner Continuing Disclosure Certificate”), for the benefit of holders and beneficial owners of the 2024 Bonds, to provide certain information relating to itself and the status of its property within Improvement Area No. 1 on a semi-annual basis, beginning on April 30, 2025, and to provide notices of the occurrence of certain enumerated events. See APPENDIX F.

The Master Developer is not an obligated person as defined under the Rule.

The obligations of the Master Developer under its Property Owner Continuing Disclosure Certificate will terminate when the property owned by it within Improvement Area No. 1 is no longer obligated to pay at least 15% or more of the Facilities Special Taxes within Improvement Area No. 1.

The Property Owner Continuing Disclosure Certificate will be the third undertaking by the Master Developer. The first and second undertakings were in association with the issuance of the City’s CFD No. 2019-1 Bonds issued in 2020 and 2021 for Planning Area 4, and the Master Developer is in compliance with those undertakings.

Lennar Homes. Lennar Homes will covenant in a Property Owner Continuing Disclosure Certificate, the form of which is set forth in Appendix F to this Official Statement, for the benefit of holders and beneficial owners of the 2024 Bonds, to provide certain information relating to itself and the status of its property within Improvement Area No. 1 on a semi-annual basis, beginning on April 30, 2025, and to provide notices of the occurrence of certain enumerated events. See “APPENDIX F – FORM OF MASTER DEVELOPER AND MERCHANT BUILDERS CONTINUING DISCLOSURE CERTIFICATE.”

Lennar Homes is not an obligated person as defined under the Rule.

The obligations of Lennar Homes under its Property Owner Continuing Disclosure Certificate will terminate when the property owned by it within Improvement Area No. 1 is no longer obligated to pay at least 15% of the Special Taxes within Improvement Area No. 1.

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Other than as disclosed in this Official Statement, in the last five years, Lennar Homes has not failed to comply in any material respects with its previous continuing disclosure undertakings, specifically regarding its requirement to provide developer periodic reports or to provide notice of occurrence of enumerated events. However, (i) in connection with the $16,780,000 California Municipal Finance Authority Special Tax Revenue Bonds BOLD Program Series 2020B, Lennar Homes inadvertently failed to file the initial semi-annual report by the due date of May 1, 2021, but filed a curative report on May 21, 2021; and (ii) in connection with the $5,795,000 City of Rancho Cordova Grantline 208 Community Facilities District No. 2018-1 Special Tax Bonds, Series 2021B, Lennar Homes inadvertently failed to file the initial annual report by the due date of April 1, 2022, but filed a curative report on September 21, 2022.

NO RATING

The City has not obtained a credit rating on the 2024 Bonds. Nothing should be assumed from any credit rating that the City may obtain for other purposes. Prospective purchasers of the 2024 Bonds are required to make independent determinations as to the credit quality of the 2024 Bonds and their appropriateness as an investment.

UNDERWRITING

The 2024 Bonds are being purchased by Stifel, Nicolaus & Company, Incorporated (the “Underwriter”), at a purchase price of $________ (which represents the aggregate principal amount of the 2024 Bonds ($________), plus original issue premium of $________, less an Underwriter's discount of $________).

The purchase agreement relating to the 2024 Bonds provides that the Underwriter will purchase all of the 2024 Bonds, if any are purchased, the obligation to make such purchase being subject to certain terms and conditions set forth in such purchase agreement.

The Underwriter may offer and sell the 2024 Bonds to certain dealers and others at prices lower than the offering prices stated on the inside cover page hereof. The offering prices may be changed from time to time by the Underwriter.

PROFESSIONAL FEES

In connection with the issuance of the 2024 Bonds, fees or compensation payable to certain professionals are contingent upon the issuance and delivery of the 2024 Bonds. Those professionals include the Underwriter, Stradling Yocca Carlson & Rauth, a Professional Corporation, as Underwriter’s Counsel, PFM Financial Advisors LLC, as municipal advisor, Goodwin Consulting Group, Inc., as special tax consultant, and The Bank of New York Mellon Trust Company, N.A., as Fiscal Agent.

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EXECUTION

The execution and delivery of the Official Statement by the City have been duly authorized by the City Council, acting as the legislative body of the District.

CITY OF FAIRFIELD

By:

John Furtado,
Director of Finance

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APPENDIX A

GENERAL INFORMATION ABOUT THE CITY OF FAIRFIELD AND SOLANO COUNTY

The following information concerning the City of Fairfield (the "City") and Solano County (the “County”) are included only for the purpose of supplying general information regarding the community. The 2024 Bonds are not a debt of the City, the County, the State of California (the “State”) or any of its political subdivisions, and neither the City, the County, the State nor any of its political subdivisions is liable therefor.

General

The City, which comprises approximately 37 square miles, is located in the County approximately 44 miles northeast of San Francisco and 42 miles west of Sacramento. The City is served by Interstate 80, the major freeway link between San Francisco and Sacramento, as well as Highway 12, a connecting freeway from Interstate 80 to Napa Valley.

Historically, the City's economy has been based upon agriculture and related industries; the City has served as a commerce center for agriculture in its region for over 100 years. In recent years, the City has transformed its economic base as a result of significant residential, industrial and commercial building activity occurring over the past several years. The City has been proactive in providing commercial/industrial development opportunities, and has formed several assessment districts to finance public improvements required by new projects. This rapid expansion in manufacturing, logistics, warehousing and distribution has led to substantial growth in population and employment.

Another major contributor to the City’s economy is Travis Air Force Base, the largest employer of both the City and the County. As of September 30, 2019 (the date of Travis Air Force Base’s latest economic impact report), the partnership between Travis Air Force Base and the County generated 12,864 indirect jobs, totaling an estimated annual dollar value of $326,626,768.

Travis Air Force Base also awarded more than $211 million worth of contracts to local businesses for work on construction, operations and maintenance of base infrastructure projects.

Municipal Government

The City was incorporated in 1892 and operates under a council/manager form of government. All municipal departments operate under the supervision of the City Manager. The City Council consists of a Mayor elected at large for a four-year term and four other Council members elected at large for overlapping four-year terms.

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Population

The Fairfield area experienced significant growth over the 1980's. The population of the City was 58,099 as of the 1980 census. By January 1, 1990 the population of the City was estimated to be 77,211, a percentage increase of approximately 33% over this ten-year period.

Further growth occurred during the 1990's, when the population grew another 25% over this ten- year period. From 2000 to 2010, the population continued to expand, increasing by approximately

9.5% over that period.

Population estimates for calendar years 1980, 1990, 2000, 2010, and the past five years in the City, the County, and the State are shown in the following table.

CITY OF FAIRFIELD, COUNTY OF SOLANO AND STATE OF CALIFORNIA Population Estimates
Calendar Years 1980, 1990, 2000, 2010, and 2020 through 2024

Year City of Fairfield Solano County State of California 1980 58,099 235,203 23,668,562
1990 77,211 339,471 29,758,213
2000 96,178 394,930 33,873,086
2010 105,321 413,344 37,253,956
2020 120,447 453,491 39,538,223
2021 119,990 450,122 39,327,868
2022 119,395 447,027 39,114,785
2023 120,036 445,506 39,061,058
2024 120,339 446,426 39,128,162

Source: State Department of Finance estimates.

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Employment and Industry

The unemployment rate in the Solano County was 5.6 percent in July 2024, up from a revised 5.1 percent in June 2024, and above the year-ago estimate of 4.6 percent. This compares with an unadjusted unemployment rate of 5.8 percent for California and 4.5 percent for the nation during the same period.

The table below shows the Vallejo-Fairfield Metropolitan Statistical Area’s labor patterns during 2019 through 2023.

VALLEJO-FAIRFIELD METROPOLITAN STATISTICAL AREA
(SOLANO COUNTY)
Civilian Labor Force, Employment and Unemployment
(Annual Averages)
(March 2023 Benchmark)

2019 2020 2021 2022 2023
Civilian Labor Force (1) 208,100 201,800 200,200 200,900 203,100 Employment 200,200 182,100 185,400 192,300 193,600
Unemployment 7,900 19,700 14,900 8,600 9,400
Unemployment Rate 3.8% 9.7% 7.4% 4.3% 4.7%
Wage and Salary Employment: (2)
Agriculture 1,500 1,500 1,600 1,600 1,400
Mining and Logging 500 400 300 300 300
Construction 12,300 11,100 11,600 12,100 11,600
Manufacturing 11,100 10,900 10,900 11,200 11,100
Wholesale Trade 4,400 4,100 4,000 4,100 4,200
Retail Trade 17,800 16,700 17,500 17,600 17,500
Trans., Warehousing, Utilities 4,800 4,900 5,200 5,500 5,600 Information 1,200 800 800 900 900
Finance and Insurance 3,400 3,400 3,200 3,000 2,900
Professional and Business Services 10,200 9,700 10,400 10,900 11,000 Educational and Health Services 29,000 27,900 27,600 28,500 29,800 Leisure and Hospitality 16,100 12,300 13,600 15,500 16,000 Other Services 4,700 4,000 4,200 4,700 5,000
Federal Government 3,600 3,600 3,600 3,400 3,300
State Government 5,400 5,400 5,200 5,200 5,000
Local Government 15,800 14,400 14,100 14,800 15,500
Total all Industries (3) 143,400 132,800 135,400 141,100 143,000

(1) Labor force data is by place of residence; includes self-employed individuals, unpaid family workers, household domestic workers, and workers on strike.
(2) Industry employment is by place of work; excludes self-employed individuals, unpaid family workers, household domestic workers, and workers on strike.
(3) Totals may not add due to rounding.

Source: State of California Employment Development Department.

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Largest Employers

Employment in the City area traditionally is centered around food processing, financial and service employees and the public sector. The following table lists some of the largest employers located within the City.

CITY OF FAIRFIELD
Largest Employers
June 30, 2023

Employer Name Type Jobs
Travis Air Force Base Military Base 13,414
County of Solano Government 2,633
Fairfield-Suisun Unified School District Education 2,213 Northbay Medical Center Hospital 1,969
Solano Community College Education 750
Partnership Health Plan Healthcare Group 561
City of Fairfield Government 553
Jelly Belly Candy Co. Candy & Confections 489
Sutter Regional Medical Foundation Insurance 475
Westamerica Bancorporation Banking 418

Source: City of Fairfield Comprehensive Annual Financial Report for fiscal year ended June 30, 2023.

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Major Employers

The table below lists the major employers in the County as of September 2024, listed alphabetically.

Solano County
Major Employers
(Listed Alphabetically)
September 2024

Employer Name Location Industry
California Medical Facility Vacaville Hospitals
Collins Aerospace Fairfield Aircraft Components-Manufacturers Duravent Inc Vacaville Ventilating Equipment (whls)
Fairfield Medical Offices Fairfield Physicians & Surgeons Flatiron Construction Corp Benicia General Contractors
Guittard Chocolate Co Fairfield Chocolate & Cocoa-Manufacturers Jelly Belly Candy Co Fairfield Candy & Confectionery-Manufacturers Kaiser Permanente Vallejo Med Vallejo Hospitals
Macy's Fairfield Department Stores
Northbay Healthcare Green Vly Fairfield Health Services Northbay Medical Ctr Fairfield Hospitals
Northbay Vacavalley Hospital Vacaville Hospitals
Quick Lane Fairfield Tire-Dealers-Retail
River Delta Unified Sch Dist Rio Vista Schools
Six Flags Discovery Kingdom Vallejo Amusement & Theme Parks Solano County Fairfield General Government Support
Solano County Sheriff Fairfield Civil Enforcement
Solano County Special Edu Fairfield Schools
Sutter Solano Medical Ctr Vallejo Hospitals
Touro University California Vallejo University-College Dept/Facility/Office Travis Air Force Base Travis AFB Military Bases
USDA Forest Svc Vallejo Government Offices-Federal
Valero Benicia Refinery Benicia Crude Oil-Petroleum Refineries Vallejo City Manager's Office Vallejo City Government-Executive Offices Walmart Supercenter Dixon Department Stores

Source: State of California Employment Development Department, extracted from The America's Labor Market Information System (ALMIS) Employer Database, 2025 1st Edition.

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Effective Buying Income

"Effective Buying Income" is defined as personal income less personal tax and nontax payments, a number often referred to as "disposable" or "after-tax" income. Personal income is the aggregate of wages and salaries, other labor-related income (such as employer contributions to private pension funds), proprietor's income, rental income (which includes imputed rental income of owner-occupants of non-farm dwellings), dividends paid by corporations, interest income from all sources, and transfer payments (such as pensions and welfare assistance).

Deducted from this total are personal taxes (federal, state and local), nontax payments (fines, fees, penalties, etc.) and personal contributions to social insurance. According to U.S. government definitions, the resultant figure is commonly known as "disposable personal income."

The following table summarizes the total effective buying income for the City, the County, the State and the United States for the calendar years 2020 through 2024.

EFFECTIVE BUYING INCOME
For Calendar Years 2020 Through 2024

Year and Area
Total Effective
Buying Income
(000s omitted)
Median Household
Effective
Buying Income

2020 City of Fairfield $3,629,583 $72,398
County of Solano 13,974,039 69,762
California 1,243,564,816 65,870
United States 9,487,165,436 55,303

2021 City of Fairfield $3,956,297 $78,067
County of Solano 14,937,066 74,976
California 1,290,894,604 67,956
United States 9,809,944,764 56,790

2022 City of Fairfield $4,177,793 $83,809
County of Solano 16,095,586 81,515
California 1,452,426,153 77,058
United States 11,208,582,541 64,448

2023 City of Fairfield $4,041,044 $81,551
County of Solano 16,044,120 81,403
California 1,461,799,662 77,175
United States 11,454,846,397 65,326

2024 City of Fairfield $4,182,467 $85,615
County of Solano 16,238,988 83,539
California 1,510,708,521 80,973
United States 11,987,185,826 67,876
_______________________
Source: Claritas, LLC.

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Commercial Activity

A summary of historic taxable sales within the City and the County during the past five years in which data is available is shown in the following table.

Total taxable transactions in the City during the first quarter of calendar year 2024 were reported to be $595,970,772, a 0.88% decrease below the total taxable transactions of $601,287,788 reported during the first quarter of calendar year 2023.

CITY OF FAIRFIELD
Taxable Retail Sales
Number of Permits and Valuation of Taxable Transactions ($000s)

Retail Stores Total All Outlets

Number
of Permits

Taxable
Transactions

Number
of Permits

Taxable
Transactions

2019 1,631 $1,327,134 2,610 $2,058,847
2020 1,786 1,263,571 2,876 1,909,404
2021 1,680 1,569,006 2,711 2,320,891
2022 1,724 1,657,114 2,792 2,576,538
2023 1,626 1,649,372 2,662 2,520,549

Source: State Department of Tax and Fee Administration.

Total taxable transactions in the County during the first quarter of calendar year 2024 were reported to be $2,333,034,761, a 1.59% decrease below the total taxable transactions of $2,370,733,398 reported during the first quarter of calendar year 2023.

SOLANO COUNTY
Taxable Retail Sales
Number of Permits and Valuation of Taxable Transactions ($000s)

Retail Stores Total All Outlets

Number
of Permits

Taxable
Transactions

Number
of Permits

Taxable
Transactions

2019 6,490 $5,278,624 10,539 $8,251,272
2020 6,996 5,511,263 11,553 8,259,715
2021 6,598 6,414,957 11,000 9,733,516
2022 6,709 6,680,984 11,253 10,432,958
2023 6,430 6,580,055 10,898 10,322,605

Source: State Department of Tax and Fee Administration.

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Building Activity

The tables below summarize building activity in the City and the County for the past five available years.

CITY OF FAIRFIELD
Total Building Permit Valuations
(Valuations in Thousands)*

2019 2020 2021 2022 2023
Permit Valuation
New Single-family $111,515.6 $125,040.2 $99,108.8 $82,323.7 $69,791.3 New Multi-family 35,889.3 67,956.5 6,733.8 200.0 3,500.0 Res. Alterations/Additions 14,254.4 7,671.8 15,695.0 14,049.4 3,530.0 Total Residential 161,659.3 200,668.5 99,108.8 82,323.7 69,791.3

New Commercial 18,027.1 15,751.2 16,228.9 15,043.9 4,500.0 New Industrial 5,854.5 27,440.0 28,476.7 37,247.7 0.0
New Other 2,394.6 610.6 726.5 1,693.8 4,077.6
Com. Alterations/Additions 31,272.5 12,849.4 10,700.2 25,767.3 17,745.9 Total Nonresidential 57,548.7 56,651.2 56,132.3 79,752.7 26,323.5

New Dwelling Units
Single Family 450 411 311 272 266
Multiple Family 56 471 7 15 42
TOTAL 456 882 318 287 308

*Subtotals may not foot due to rounding.

Source: Construction Industry Research Board, Building Permit Summary.

COUNTY OF SOLANO
Total Building Permit Valuations
(Valuations in Thousands)*

2019 2020 2021 2022 2023
Permit Valuation
New Single-family $295,149.8 $268,545.4 $278,390.1 $236,769.7 $170,010.9 New Multi-family 35,889.3 98,968.6 79,671.6 132,532.4 19,997.5 Res. Alterations/Additions 69,033.4 36,717.8 43,676.2 44,527.5 33,662.2 Total Residential 400,072.5 404,231.8 401,737.9 413,829.6 233,670.6

New Commercial 99,650.4 52,595.3 56,714.4 55,844.8 20,040.0 New Industrial 7,350.2 29,922.0 35,643.2 38,282.4 0.0
New Other 20,518.4 18,403.6 26,915.0 37,414.5 32,133.3
Com. Alterations/Additions 79,382.4 71,558.4 32,691.6 58,833.6 44,167.2 Total Nonresidential 206,901.4 172,479.3 151,964.2 190,375.3 96,340.5

New Dwelling Units
Single Family 1,147 981 909 872 646
Multiple Family 56 716 347 603 144
TOTAL 1,203 1,697 1,256 1,475 790

*Subtotals may not foot due to rounding.

Source: Construction Industry Research Board, Building Permit Summary.

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APPENDIX B

AMENDED AND RESTATED

RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX FOR
IMPROVEMENT AREA NO. 1 OF THE
CITY OF FAIRFIELD COMMUNITY FACILITIES DISTRICT NO. 2023-1 (ONE LAKE PLANNING AREA 5)

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APPENDIX C

SUMMARY OF CERTAIN PROVISIONS OF THE FISCAL AGENT AGREEMENT

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APPENDIX D

DTC AND THE BOOK-ENTRY ONLY SYSTEM

The following description of the Depository Trust Company (“DTC”), the procedures and record keeping with respect to beneficial ownership interests in the 2024 Bonds, payment of principal, interest and other payments on the 2024 Bonds (herein, the “Securities”) to DTC Participants or Beneficial Owners, confirmation and transfer of beneficial ownership interest in the Securities and other related transactions by and between DTC, the DTC Participants and the Beneficial Owners is based solely on information provided by DTC. Accordingly, no representations can be made concerning these matters and neither the DTC Participants nor the Beneficial Owners should rely on the foregoing information with respect to such matters, but should instead confirm the same with DTC or the DTC Participants, as the case may be.

Neither the issuer of the Securities (the “Issuer”) nor the trustee, fiscal agent or paying agent appointed with respect to the Securities (the “Agent”) takes any responsibility for the information contained in this Appendix.

No assurances can be given that DTC, DTC Participants or Indirect Participants will distribute to the Beneficial Owners (a) payments of interest, principal or premium, if any, with respect to the Securities, (b) certificates representing ownership interest in or other confirmation or ownership interest in the Securities, or (c) redemption or other notices sent to DTC or Cede & Co., its nominee, as the registered owner of the Securities, or that they will so do on a timely basis, or that DTC, DTC Participants or DTC Indirect Participants will act in the manner described in this Appendix. The current "Rules" applicable to DTC are on file with the Securities and Exchange Commission and the current "Procedures" of DTC to be followed in dealing with DTC Participants are on file with DTC.

1. The Depository Trust Company (“DTC”), New York, NY, will act as securities depository for the securities (the “Securities”). The Securities will be issued as fully-registered securities registered in the name of Cede & Co. (DTC’s partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered Security certificate will be issued for each issue of the Securities, each in the aggregate principal amount of such issue, and will be deposited with DTC. If, however, the aggregate principal amount of any issue exceeds $500 million, one certificate will be issued with respect to each $500 million of principal amount, and an additional certificate will be issued with respect to any remaining principal amount of such issue.

2. DTC, the world’s largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code, and a “clearing agency” registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC’s participants (“Direct Participants”) deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants’ accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned Packet Page 319 of 530Attachment 3 Page 106 of 129

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subsidiary of The Depository Trust & Clearing Corporation (“DTCC”). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly (“Indirect Participants”). DTC has a Standard & Poor’s rating of AA+. The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com . The information contained on this Internet site is not incorporated herein by reference.

3. Purchases of Securities under the DTC system must be made by or through Direct Participants, which will receive a credit for the Securities on DTC’s records. The ownership interest of each actual purchaser of each Security (“Beneficial Owner”) is in turn to be recorded on the Direct and Indirect Participants’ records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Securities are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners.

Beneficial Owners will not receive certificates representing their ownership interests in Securities, except in the event that use of the book-entry system for the Securities is discontinued.

4. To facilitate subsequent transfers, all Securities deposited by Direct Participants with DTC are registered in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of Securities with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Securities; DTC’s records reflect only the identity of the Direct Participants to whose accounts such Securities are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers.

5. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of Securities may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Securities, such as redemptions, tenders, defaults, and proposed amendments to the Security documents. For example, Beneficial Owners of Securities may wish to ascertain that the nominee holding the Securities for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided directly to them.

6. Redemption notices shall be sent to DTC. If less than all of the Securities within an issue are being redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed.

7. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Securities unless authorized by a Direct Participant in accordance with DTC’s MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to Issuer as soon as Packet Page 320 of 530Attachment 3 Page 107 of 129

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possible after the record date. The Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to whose accounts Securities are credited on the record date (identified in a listing attached to the Omnibus Proxy).

8. Redemption proceeds, distributions, and dividend payments on the Securities will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail information from Issuer or Agent, on payable date in accordance with their respective holdings shown on DTC’s records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in “street name,” and will be the responsibility of such Participant and not of DTC, Agent, or Issuer, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of Issuer or Agent, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.

9. DTC may discontinue providing its services as depository with respect to the Securities at any time by giving reasonable notice to Issuer or Agent. Under such circumstances, in the event that a successor depository is not obtained, Security certificates are required to be printed and delivered.

10. Issuer may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, Security certificates will be printed and delivered to DTC.

11. The information in this section concerning DTC and DTC’s book-entry system has been obtained from sources that Issuer believes to be reliable, but Issuer takes no responsibility for the accuracy thereof.

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APPENDIX E

FORM OF CITY CONTINUING DISCLOSURE CERTIFICATE

CONTINUING DISCLOSURE CERTIFICATE

$________________
IMPROVEMENT AREA NO. 1 OF THE

CITY OF FAIRFIELD
COMMUNITY FACILITIES DISTRICT NO. 2023-1
(ONE LAKE PLANNING AREA 5)
SPECIAL TAX BONDS, SERIES 2024A

This Continuing Disclosure Certificate (this “Disclosure Certificate”) is executed and delivered by the City of Fairfield (the “City”) in connection with the issuance of the bonds captioned above (the “2024 Bonds”). The 2024 Bonds are being issued pursuant to a Fiscal Agent Agreement dated as of November 1, 2024 (the “Fiscal Agent Agreement”), by and between the City and The Bank of New York Mellon, N.A., as fiscal agent (the “Fiscal Agent”). The City hereby covenants and agrees as follows:

Section 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is being executed and delivered by the City for the benefit of the holders and beneficial owners of the 2024 Bonds and in order to assist the Participating Underwriter in complying with S.E.C. Rule 15c2- 12(b)(5).

Section 2. Definitions. In addition to the definitions set forth above and in the Fiscal Agent Agreement, which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms shall have the following meanings:

“Annual Report” means any Annual Report provided by the City pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate.

“Annual Report Date” means the date that is nine months after the end of the City 's fiscal year (currently March 31 based on the City’s fiscal year end of June 30).

“Dissemination Agent” means Willdan Financial Services, or any successor Dissemination Agent designated in writing by the City and which has filed with the City a written acceptance of such designation.

“District” means the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5).

“Improvement Area No. 1” means Improvement Area No. 1 of the District.

“Listed Events” means any of the events listed in Section 5(a) of this Disclosure Certificate.

“MSRB” means the Municipal Securities Rulemaking Board, which has been designated by the Securities and Exchange Commission as the sole repository of disclosure information for purposes of the Rule.

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“Official Statement” means the final Official Statement dated ___________, 2024, executed by the City in connection with the issuance of the 2024 Bonds.

“Participating Underwriter” means Stifel, Nicolaus & Company, Incorporated, the original underwriter of the 2024 Bonds required to comply with the Rule in connection with offering of the 2024 Bonds.

“Rule” means Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as it may be amended from time to time.

Section 3. Provision of Annual Reports.

(a) The City shall, or shall cause the Dissemination Agent to, not later than the Annual Report Date, commencing March 31, 2025, with the report for the 2024-25 fiscal year, provide to the MSRB, in an electronic format as prescribed by the MSRB, an Annual Report that is consistent with the requirements of Section 4 of this Disclosure Certificate. Not later than 15 Business Days prior to the Annual Report Date, the City shall provide the Annual Report to the Dissemination Agent (if other than the City). If by 15 Business Days prior to the Annual Report Date the Dissemination Agent (if other than the City) has not received a copy of the Annual Report, the Dissemination Agent shall contact the City to determine if the City is in compliance with the previous sentence. The Annual Report may be submitted as a single document or as separate documents comprising a package, and may include by reference other information as provided in Section 4 of this Disclosure Certificate; provided that the audited financial statements of the City may be submitted separately from the balance of the Annual Report, and later than the Annual Report Date, if not available by that date. If the City's fiscal year changes, it shall give notice of such change in the same manner as for a Listed Event under Section 5(b).

(b) If the City does not provide, or cause the Dissemination Agent to provide, an Annual Report by the Annual Report Date as required in subsection (a) above, the Dissemination Agent shall provide a notice to the MSRB, in a timely manner, in an electronic format as prescribed by the MSRB.

(i) determine each year prior to the Annual Report Date the then-applicable rules and electronic format prescribed by the MSRB for the filing of annual continuing disclosure reports; and

(ii) if the Dissemination Agent is other than the City, file a report with the City and the Participating Underwriter certifying that the Annual Report has been provided pursuant to this Disclosure Certificate, and stating the date it was provided.

Section 4. Content of Annual Reports. The City's Annual Report shall contain or incorporate by reference the following documents and information:

(a) The City's audited financial statements for the most recently completed fiscal year, prepared in accordance with Generally Accepted Accounting Principles as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board, together with the following statement:

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THE CITY'S ANNUAL FINANCIAL STATEMENT IS PROVIDED SOLELY TO COMPLY WITH THE SECURITIES EXCHANGE COMMISSION STAFF’S
INTERPRETATION OF RULE 15c2-12. NO FUNDS OR ASSETS OF THE CITY OR THE

DISTRICT, OTHER THAN SPECIAL TAX REVENUES FROM IMPROVEMENT AREA NO. 1 OF THE DISTRICT, ARE REQUIRED TO BE USED TO PAY DEBT SERVICE ON THE 2024 BONDS, AND NEITHER THE CITY NOR THE DISTRICT IS OBLIGATED TO ADVANCE AVAILABLE FUNDS TO COVER ANY DELINQUENCIES. INVESTORS

SHOULD NOT RELY ON THE FINANCIAL CONDITION OF THE CITY OR THE DISTRICT IN EVALUATING WHETHER TO BUY, HOLD OR SELL THE 2024 BONDS.

(b) To the extent not included in the audited financial statements, the following information:

(i) The principal amount of the 2024 Bonds outstanding, the balance in the 2024 Reserve Fund (along with a statement of the 2024 Reserve Requirement) as of the September 30 next preceding the Annual Report Date, and the issuance date and principal amount of any additional bonds or obligations issued under the Fiscal Agent Agreement on a parity with the 2024 Bonds.

(ii) The total dollar amount of delinquencies, if any, in Improvement Area No. 1 as of August 1 of the prior calendar year and, if the total delinquencies within Improvement Area No. 1 as of August 1 in the prior calendar year exceed 5% of the Special Tax for the previous fiscal year, delinquency information for each parcel responsible for more than $5,000 in the payment of Special Tax, amounts of delinquencies, length of delinquency and status of any foreclosure of each such parcel.

(iii) The amount of prepayments of the Special Tax for the prior Fiscal Year.

(iv) Total assessed value (per the Solano County Assessor’s records) of all parcels currently subject to the Special Tax within Improvement Area No. 1.

(v) An updated table in substantially the form of the table in the Official Statement entitled “Table 2 Fiscal Year 2025-26 Maximum Facilities Special Tax Revenues and Value-to-Lien Ratios,” showing the Facilities Special Tax levy for the then- current Fiscal Year, and substituting assessed values shown on the Solano County Assessor's last equalized tax roll prior to the September next preceding the Annual Report Date for appraised values.

(vi) Any changes to the Amended Rate and Method of Apportionment of Special Tax for Improvement Area No. 1 set forth in Appendix B to the Official Statement.

(vii) A description of the number of building permits issued with respect to Improvement Area No. 1 as of the previous June 30.

(viii) A copy of the most recent annual information required to be filed by the City with the California Debt and Investment Advisory Commission pursuant to the Act and relating generally to outstanding Community Facilities District bond amounts, fund balances, assessed values, special tax delinquencies and foreclosure information.

(c) In addition to any of the information expressly required to be provided under paragraph (b) above, the City shall provide such further information, if any, as may be necessary Packet Page 324 of 530Attachment 3 Page 111 of 129

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to make the specifically required statements, in the light of the circumstances under which they are made, not misleading.

(d) Any or all of the items listed above may be included by specific reference to other documents, including official statements of debt issues of the City or related public entities, which are available to the public on the MSRB’s Internet web site or filed with the Securities and Exchange Commission. The City shall clearly identify each such other document so included by reference.

Section 5. Reporting of Listed Events.

(a) The City shall give, or cause to be given, notice of the occurrence of any of the following Listed Events with respect to the Bonds:

(1) Principal and interest payment delinquencies.

(2) Non-payment related defaults, if material.

(3) Unscheduled draws on Debt Service reserves reflecting financial difficulties.

(4) Unscheduled draws on credit enhancements reflecting financial difficulties.

(5) Substitution of credit or liquidity providers, or their failure to perform.

(6) Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax status of the 2024 Bonds, or other material events affecting the tax status of the 2024 Bonds.

(7) Modifications to rights of security holders, if material.

(8) Bond calls, if material, and tender offers.

(9) Defeasances.

(10) Release, substitution, or sale of property securing repayment of the securities, if material.

(11) Rating changes.
(12) Bankruptcy, insolvency, receivership or similar event of the obligated person.

(13) The consummation of a merger, consolidation, or acquisition involving the obligated person, or the sale of all or substantially all of the assets of the obligated person (other than in the ordinary course of business), the entry into a definitive agreement to undertake such an action, or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material.

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(14) Appointment of a successor or additional Fiscal Agent or the change of name of the Fiscal Agent, if material.

(15) Incurrence of a financial obligation of the obligated person, if material, or agreement to covenants, events of default, remedies, priority rights, or other similar terms of a financial obligation of the obligated person, any of which affect security holders, if material.

(16) Default, event of acceleration, termination event, modification of terms, or other similar events under the terms of a financial obligation of the obligated person any of which reflect financial difficulties.

(b) Upon the occurrence of a Listed Event, the City shall, or shall cause the Dissemination Agent (if not the City) to, file a notice of such occurrence with the MSRB, in an electronic format as prescribed by the MSRB, in a timely manner not in excess of 10 business days after the occurrence of the Listed Event. Notwithstanding the foregoing, notice of Listed Events described in subsection (a)(8) above need not be given under this subsection any earlier than the notice (if any) of the underlying event is given to holders of affected Bonds under the Fiscal Agent Agreement.

(c) The City acknowledges that the events described in subparagraphs (a)(2), (a)(7), (a)(8) (if the event is a bond call), (a)(10), (a)(13), (a)(14) and (a)(15) of this Section 5 contain the qualifier “if material” and that subparagraph (a)(6) also contains the qualifier "material" with respect to certain notices, determinations or other events affecting the tax status of the 2024 Bonds. The City shall cause a notice to be filed as set forth in paragraph (b) above with respect to any such event only to the extent that it determines the event’s occurrence is material for purposes of U.S. federal securities law. Upon occurrence of any of these Listed Events, the City will as soon as possible determine if such event would be material under applicable federal securities law. If such event is determined to be material, the City will cause a notice to be filed as set forth in paragraph (b) above.

(d) For purposes of this Disclosure Certificate, any event described in paragraph (a)(12) above is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent, or similar officer for the City in a proceeding under the United States Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the City, or if such jurisdiction has been assumed by leaving the existing governing body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement, or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the City.
(e) For purposes of Section 5(a)(15) and (16), “financial obligation” means a (i) debt obligation; (ii) derivative instrument entered into in connection with, or pledged as security or a source of payment for, an existing or planned debt obligation; or (iii) guarantee of (i) or (ii). The term financial obligation shall not include municipal securities as to which a final official statement has been provided to the Municipal Securities Rulemaking Board consistent with the Rule.

Section 6. Identifying Information for Filings with the MSRB. All documents provided to the MSRB under the Disclosure Certificate shall be accompanied by identifying information as prescribed by the MSRB.

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Section 7. Termination of Reporting Obligation. The City's obligations under this Disclosure Certificate shall terminate upon the legal defeasance, prior redemption or payment in full of all of the 2024 Bonds. If such termination occurs prior to the final maturity of the 2024 Bonds, the City shall give notice of such termination in the same manner as for a Listed Event under Section 5(c).

Section 8. Dissemination Agent. The City may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Certificate, and may discharge any Dissemination Agent, with or without appointing a successor Dissemination Agent. The initial Dissemination Agent will be Willdan Financial Services. Any Dissemination Agent may resign by providing 30 day’s prior written notice to the City.

Section 9. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate, the City may amend this Disclosure Certificate, and any provision of this Disclosure Certificate may be waived, provided that the following conditions are satisfied:

(a) if the amendment or waiver relates to the provisions of Sections 3(a), 4 or 5(a), it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature, or status of an obligated person with respect to the 2024 Bonds, or type of business conducted;

(b) the undertakings herein, as proposed to be amended or waived, would, in the opinion of nationally recognized bond counsel, have complied with the requirements of the Rule at the time of the primary offering of the 2024 Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and

(c) the proposed amendment or waiver either (i) is approved by holders of the 2024 Bonds in the manner provided in the Fiscal Agent Agreement for amendments to the Fiscal Agent Agreement with the consent of holders, or (ii) does not, in the opinion of the Fiscal Agent or nationally recognized bond counsel, materially impair the interests of the holders or beneficial owners of the 2024 Bonds.

If the annual financial information or operating data to be provided in the Annual Report is amended pursuant to the provisions hereof, the first annual financial information filed pursuant hereto containing the amended operating data or financial information shall explain, in narrative form, the reasons for the amendment and the impact of the change in the type of operating data or financial information being provided.

If an amendment is made to the undertaking specifying the accounting principles to be followed in preparing financial statements, the annual financial information for the year in which the change is made shall present a comparison between the financial statements or information prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles. The comparison shall include a qualitative discussion of the differences in the accounting principles and the impact of the change in the accounting principles on the presentation of the financial information, in order to provide information to investors to enable them to evaluate the ability of the City to meet its obligations. To the extent reasonably feasible, the comparison shall be quantitative. A notice of the change in the accounting principles shall be filed in the same manner as for a Listed Event under Section 5(c).

Section 10. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the City from disseminating any other information, using the means of dissemination Packet Page 327 of 530Attachment 3 Page 114 of 129

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set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the City chooses to include any information in any Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the City shall have no obligation under this Disclosure Certificate to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event.

Section 11. Default. In the event of a failure of the City to comply with any provision of this Disclosure Certificate, the Participating Underwriter or any holder or beneficial owner of the 2024 Bonds may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the City to comply with its obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not be deemed an Event of Default under the Fiscal Agent Agreement, and the sole remedy under this Disclosure Certificate in the event of any failure of the City to comply with this Disclosure Certificate shall be an action to compel performance.

Section 12. Duties, Immunities and Liabilities of Dissemination Agent. The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate, and the City agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorneys’ fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent's negligence or willful misconduct. The Dissemination Agent shall have no duty or obligation to review any information provided to it hereunder and shall not be deemed to be acting in any fiduciary capacity for the City, the Property Owner, the Fiscal Agent, the Bond owners or any other party. The obligations of the City under this Section shall survive resignation or removal of the Dissemination Agent and payment of the 2024 Bonds.

Section 13. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the City, the Fiscal Agent, the Dissemination Agent, the Participating Underwriter and holders and beneficial owners from time to time of the 2024 Bonds, and shall create no rights in any other person or entity.

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Section 14. Counterparts. This Disclosure Certificate may be executed in several counterparts, each of which shall be regarded as an original, and all of which shall constitute one and the same instrument.

Dated: _______________, 2024

CITY OF FAIRFIELD

By:

John Furtado,
Director of Finance

AGREED AND ACCEPTED:

WILLDAN FINANCIAL SERVICES,
as Dissemination Agent

By:

Name:

Title:

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APPENDIX F

FORM OF MASTER DEVELOPER AND MERCHANT BUILDERS DISCLOSURE

CERTIFICATE

CONTINUING DISCLOSURE CERTIFICATE
(Property Owner ___________)

$___________________
IMPROVEMENT AREA NO. 1 OF THE

CITY OF FAIRFIELD
COMMUNITY FACILITIES DISTRICT NO. 2023-1
(ONE LAKE PLANNING AREA 5)
SPECIAL TAX BONDS, SERIES 2024A

This Continuing Disclosure Certificate (Property Owner – ________) (this “Disclosure Certificate”) is executed and delivered by _________ (the “Property Owner”), in connection with the issuance by the City of Fairfield (the “City”) of the bonds captioned above (the “Bonds”) for and on behalf of the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5) (the “District”) with respect to its Improvement Area No. 1. The Bonds are being issued under a Fiscal Agent Agreement dated as of November 1, 2024 (the “Fiscal Agent Agreement”), by and between the City and The Bank of New York Mellon Trust Company, N.A., as fiscal agent (the “Fiscal Agent”). The Property Owner covenants and agrees as follows:

Section 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is being executed and delivered by the Property Owner for the benefit of the holders and beneficial owners of the Bonds.

Section 2. Definitions. In addition to the definitions set forth above and in the Fiscal Agent Agreement, which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined herein, the following capitalized terms shall have the following meanings:

“Affiliate” means any person presently directly (or indirectly through one or more intermediaries) under managerial control of the Property Owner, and about whom information could be material to potential investors in their investment decision regarding the Bonds (including without limitation information relevant to the proposed development of the Property or to the Property Owner’s ability to pay the Special Taxes levied on the Property prior to delinquency).

“Assumption Agreement” means an undertaking of a Major Owner, for the benefit of the holders and beneficial owners of the Bonds, containing terms substantially similar to this Disclosure Certificate (as modified for such Major Owner’s development and financing plans with respect to the property in Improvement Area No. 1 acquired by the Major Owner), whereby such Major Owner agrees to provide semi-annual reports and notices of significant events, setting forth the information described in sections 4 and 5 hereof, respectively, with respect to the portion of the property in Improvement Area No. 1 owned by such Major Owner and, at the option of the Property Owner or such Major Owner, agrees to indemnify the Dissemination Agent (if any) pursuant to a provision substantially in the form of Section 12 hereof.

“Dissemination Agent” means the Property Owner or an entity experienced in providing dissemination agent services such as those required under this Disclosure Certificate designated by the Property Owner to serve as the Dissemination Agent hereunder and who has accepted Packet Page 330 of 530Attachment 3 Page 117 of 129

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such obligation in writing, and for which the Property Owner has filed with the City and the Participating Underwriter notice of such designation and acceptance.

“Improvement Area No. 1” means Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5).

“Official Statement” means the final Official Statement dated ___________, 2024, executed by the City in connection with the issuance of the Bonds.

“Listed Events” means any of the events listed in Section 5(a) of this Disclosure Certificate.

“Major Owner” means, as of any date of calculation, an owner of land in Improvement Area No. 1 responsible in the aggregate for 15% or more of the Special Taxes actually levied or to be levied at any time during the then-current or next fiscal year.

“MSRB” means the Municipal Securities Rulemaking Board, which has been designated by the Securities and Exchange Commission as the sole repository of disclosure information.

“Participating Underwriter” means Stifel, Nicolaus & Company, Incorporated, the original underwriter of the Bonds.

“Property” means (i) the property owned by the Property Owner in Improvement Area No. 1, and (ii) the property in Improvement Area No. 1 that the Property Owner sold to a Major Owner who has not assumed the undertakings of this Disclosure Certificate under Section 7(b) with respect to such property.

“Report Date” means (a) October 31 of each year, and (b) April 30 of each year.

“Semi-Annual Report” means any Semi-Annual Report provided by the Property Owner pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate.

“Special Taxes” means the Facilities Special Taxes levied by the City on the Property.

Section 3. Provision of Semi-Annual Reports.

(a) Until such obligations are terminated pursuant to Section 7 herein, the Property Owner shall, or upon written direction of the Property Owner the Dissemination Agent shall, not later than the Report Date, commencing April 30, 2025, provide to the MSRB, in an electronic format as prescribed by the MSRB, a Semi-Annual Report which is consistent with the requirements of Section 4 of this Disclosure Certificate with a copy to the Participating Underwriter and the City. Not later than 15 calendar days prior to the Report Date, the Property Owner shall provide the Semi-Annual Report to the Dissemination Agent (if different from the Property Owner).

The Property Owner shall provide a written certification with (or included as a part of) each Semi- Annual Report furnished to the Dissemination Agent (if different from the Property Owner), the Participating Underwriter and the City to the effect that such Semi-Annual Report constitutes the Semi-Annual Report required to be furnished by it under this Disclosure Certificate. The Dissemination Agent, the Participating Underwriter and the City may conclusively rely upon such certification of the Property Owner and shall have no duty or obligation to review the Semi-Annual Report. The Semi-Annual Report may be submitted as a single document or as separate documents comprising a package, and may incorporate by reference other information as provided in Section 4 of this Disclosure Certificate.

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(b) If the Dissemination Agent is not the Property Owner and it does not receive a Semi-Annual Report by 15 calendar days prior to the Report Date, the Dissemination Agent shall send a reminder notice to the Property Owner that the Semi-Annual Report has not been provided as required under Section 3(a) above. The reminder notice shall instruct the Property Owner to determine whether its obligations under this Disclosure Certificate have terminated (pursuant to Section 7 below) and, if so, to provide the Dissemination Agent with a notice of such termination in the same manner as for a Listed Event (pursuant to Section 5 below). If the Property Owner does not provide, or cause the Dissemination Agent to provide, a Semi-Annual Report to the MSRB by the Report Date as required in subsection (a) above, the Dissemination Agent shall, in a timely manner, provide a notice to the MSRB, in an electronic format as prescribed by the MSRB, with a copy to the City and the Participating Underwriter.

(i) determine prior to each Report Date the then-applicable rules and electronic format prescribed by the MSRB for the filing of continuing disclosure reports; and

(ii) to the extent the Semi-Annual Report has been furnished to it, file a report with the Property Owner (if the Dissemination Agent is other than the Property Owner), the City and the Participating Underwriter certifying that the Semi-Annual Report has been provided pursuant to this Disclosure Certificate, and stating the date it was provided.

Section 4. Content of Semi-Annual Reports. Each Semi-Annual Report shall contain or incorporate by reference the information set forth in Exhibit A, any or all of which may be included by specific reference to other documents, including official statements of debt issues of the Property Owner or related public entities, which are available to the public on the MSRB’s Internet web site or filed with the Securities and Exchange Commission. The Property Owner shall clearly identify each such other document so included by reference.

In addition to any of the information expressly required to be provided in Exhibit A, each Semi-Annual Report shall include such further information, if any, as may be necessary to make the specifically required statements, in the light of the circumstances under which they are made, not misleading.

Section 5. Reporting of Significant Events.

(a) Until such obligations are terminated pursuant to Section 7 herein, the Property Owner shall give, or cause to be given, notice of the occurrence of any of the following Listed Events with respect to itself or the Property, if material:

(i) bankruptcy or insolvency proceedings commenced by or against the Property Owner and, if known, any bankruptcy or insolvency proceedings commenced by or against any Affiliate of the Property Owner;

(ii) failure to pay any taxes, special taxes (including the Special Taxes) or assessments due with respect to the Property prior to the delinquency date, to the extent such failure is not promptly cured by the Property Owner upon discovery thereof;

(iii) filing of a lawsuit against the Property Owner or, if known, an Affiliate of the Property Owner, seeking damages which, if successful, could have a material and adverse impact Packet Page 332 of 530Attachment 3 Page 119 of 129

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on the Property Owner’s ability to pay Special Taxes prior to delinquency or to sell or develop the Property;

(iv) material damage to or destruction of any of the improvements on the Property; and

(v) any payment default or other material default by the Property Owner that continues to exist beyond any applicable notice and cure periods on any loan with respect to the construction of improvements on the Property.

(b) Whenever the Property Owner obtains knowledge of the occurrence of a Listed Event, the Property Owner shall as soon as possible determine if such event would be material under applicable Federal securities law.

(c) If the Property Owner determines that knowledge of the occurrence of a Listed Event would be material under applicable Federal securities law, the Property Owner shall, or shall cause the Dissemination Agent to, within 10 business days file a notice of such occurrence with the MSRB, in an electronic format as prescribed by the MSRB, with a copy to the City and the Participating Underwriter.

Section 6. Identifying Information for Filings with the MSRB. All documents provided to the MSRB under this Disclosure Certificate shall be accompanied by identifying information as prescribed by the MSRB.

Section 7. Duration of Reporting Obligation.

(a) All of the Property Owner’s obligations hereunder shall commence on the date hereof and shall terminate (except as provided in Section 12) on the earliest to occur of the following:

(i) upon the legal defeasance, prior redemption or payment in full of all the Bonds, or

(ii) at such time as the Property in Improvement Area No. 1 owned by the Property Owner is no longer responsible for payment of 15% or more of the Special Taxes, or

(iii) the date on which the Property Owner prepays in full all of the Special Taxes attributable to the Property.

The Property Owner shall give notice of the termination of its obligations under this Disclosure Certificate in the same manner as for a Listed Event under Section 5.

(b) If a portion of the Property is conveyed to a person or entity that, upon such conveyance, will be a Major Owner, the obligations of the Property Owner hereunder with respect to the property conveyed to such Major Owner may be assumed by such Major Owner and the Property Owner’s obligations hereunder with respect to the property conveyed will be terminated.

In order to effect such assumption, such Major Owner shall enter into an Assumption Agreement in form and substance substantially similar to this Disclosure Agreement. However, a Major Owner shall not be required to enter into an Assumption Agreement if such Major Owner is already a party to a continuing disclosure certificate in form and substance similar to this Disclosure Certificate with respect to the Bonds, and under which the property conveyed to such Major Owner will become subject to future semi-annual reports.

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Section 8. Dissemination Agent. The Property Owner may, from time to time, with the written consent of the City, appoint or engage a Dissemination Agent to assist the Property Owner in carrying out its obligations under this Disclosure Certificate, and may discharge any such Dissemination Agent, with the written consent of the City, with or without appointing a successor Dissemination Agent. The initial Dissemination Agent shall be ___________. The Dissemination Agent may resign by providing 30 days’ written notice to the City, the Property Owner, and the Participating Underwriter.

Section 9. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate, the Property Owner may amend this Disclosure Certificate, and any provision of this Disclosure Certificate may be waived, provided that the following conditions are satisfied (provided, however, that the Dissemination Agent shall not be obligated under any such amendment that modifies or increases its duties or obligations hereunder without its written consent thereto):

(a) if the amendment or waiver relates to the provisions of sections 3(a), 4 or 5(a), it may only be made in connection with a change in circumstances that arises from a change in legal requirements, or change in law;

(b) the proposed amendment or waiver either (i) is approved by holders of the Bonds in the manner provided in the Fiscal Agent Agreement with the consent of holders, or (ii) does not, in the opinion of nationally recognized bond counsel, materially impair the interests of the holders or beneficial owners of the Bonds.

Section 10. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the Property Owner from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Semi-Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the Property Owner chooses to include any information in any Semi-Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the Property Owner shall have no obligation under this Disclosure Certificate to update such information or include it in any future Semi-Annual Report or notice of occurrence of a Listed Event.

Section 11. Default. In the event of a failure of the Property Owner to comply with any provision of this Disclosure Certificate, the Participating Underwriter, the City, and any holder or beneficial owner of the Bonds may, take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Property Owner to comply with its obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not be deemed an Event of Default under the Fiscal Agent Agreement, and the sole remedy under this Disclosure Certificate in the event of any failure of the Property Owner to comply with this Disclosure Certificate shall be an action to compel performance.

Section 12. Duties, Immunities and Liabilities of Dissemination Agent. The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate, and the Property Owner agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the reasonable costs and expenses (including attorneys’ fees) of defending against any claim of liability, but excluding any loss, expense and liabilities due to the Dissemination Agent’s negligence or willful misconduct or failure to perform its duties hereunder. If the Dissemination Packet Page 334 of 530Attachment 3 Page 121 of 129

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Agent is not the Property Owner, the Dissemination Agent shall be paid compensation for its services provided hereunder from the Administrative Expense Fund established under the Fiscal Agent Agreement in accordance with the Dissemination Agent’s schedule of fees as amended from time to time, which schedule, as amended, shall be reasonably acceptable, and all reasonable expenses, reasonable legal fees and advances made or incurred by the Dissemination Agent in the performance of its duties hereunder. The Dissemination Agent shall have no duty or obligation to review any information provided to it hereunder and shall not be deemed to be acting in any fiduciary capacity for the City, the Property Owner, the Participating Underwriter, the Bond owners, or any other party. The obligations of the Property Owner under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds.

Section 13. Notices. Any notice or communications to be among any of the parties to this Disclosure Certificate may be given by regular, overnight, or electronic mail as follows:

To the issuer: City of Fairfield
1000 Webster Street
Fairfield, CA 94533
Fax: (707) 728-7621
[email protected]

To the Participating Underwriter: Stifel, Nicolaus & Company, Incorporated One Montgomery Street, Suite 3700
San Francisco, CA 94104
[email protected]

To the Property Owner:

Any person may, by written notice to the other persons listed above, designate a different address or telephone number(s) to which subsequent notices or communications should be sent.

Section 14. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the City, the Property Owner (its successors and assigns), the Dissemination Agent, the Participating Underwriter and holders and beneficial owners from time to time of the Bonds, and shall create no rights in any other person or entity. All obligations of the Property Owner hereunder shall be assumed by any legal successor to the obligations of the Property Owner as a result of a sale, merger, consolidation or other reorganization.

Section 15. Counterparts. This Disclosure Certificate may be executed in several counterparts, each of which shall be regarded as an original, and all of which shall constitute one and the same instrument.

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Date:

[PROPERTY OWNER],
a ____________

By:

Title:

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EXHIBIT A

SEMI-ANNUAL REPORT

[APRIL 30, ____ / OCTOBER 31, _____]

$_______
IMPROVEMENT AREA NO. 1 OF THE

CITY OF FAIRFIELD
COMMUNITY FACILITIES DISTRICT NO. 2023-1 (ONE LAKE PLANNING AREA 5) SPECIAL TAX BONDS, SERIES 2024A

This Semi-Annual Report is hereby submitted under Section 4 of the Continuing Disclosure Certificate (Property Owner – ________) (the “Disclosure Certificate”) dated as of _________, 2024, executed by the undersigned (the “Property Owner”) in connection with the issuance by the City of Fairfield (the “City”) of the bonds captioned above (the “Bonds”) for Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5) (the “District”).

Capitalized terms used in this Semi-Annual Report but not otherwise defined have the meanings given to them in the Disclosure Certificate.

I. Property Ownership and Development

The information in this section is provided as of ____________________ (this date must be not more than 60 days before the Report Date of this Semi-Annual Report).

A. Description of the Property currently owned by the Property Owner in Improvement Area No. 1 of the District (the “Property”): in substance and form similar to such information in the Official Statement for the Bonds.

________________________________________________________________________ ________________________________________________________________________

B. Updated information regarding land development and home construction activities with respect to the Property described in the Official Statement for the Bonds or the Semi-Annual Report last filed in accordance with the Disclosure Certificate:

________________________________________________________________________ ________________________________________________________________________

C. Status of building permits and any material changes to the description of land use or development entitlements for the Property described in the Official Statement for the Bonds or the Semi-Annual Report last filed in accordance with the Disclosure Certificate:

________________________________________________________________________ ________________________________________________________________________

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D. Status of any land purchase contracts with regard to the Property, whether acquisition of land in Improvement Area No. 1 by the Property Owner or sales of land to other property owners (other than individual homeowners).
________________________________________________________________________ ________________________________________________________________________

II. Legal and Financial Status of Property Owner

Unless such information has previously been included or incorporated by reference in a Semi-Annual Report, describe any material change in the legal structure of the Property Owner or the financial condition and financing plan of the Property Owner that would materially and adversely interfere with its ability to complete its development plan described in the Official Statement. To the extent that the ownership of the Property Owner has changed, describe all material terms of the new ownership structure.

________________________________________________________________________ ________________________________________________________________________

III. Change in Development or Financing Plans

Unless such information has previously been included or incorporated by reference in a Semi-Annual Report, describe any development plans or financing plans relating to the Property that are materially different from the proposed development and financing plan described in the Official Statement.
________________________________________________________________________ ________________________________________________________________________

IV. Change in Relationship with Merchant Builders

To the extent a relationship exists between the Property Owner and a merchant builder, describe any material change in such relationship with respect to the construction, marketing and sale of homes within Improvement Area No. 1. To the extent that a new merchant builder has been engaged to carry out home construction, marketing and sales activity by the Property Owner in Improvement Area No. 1, fully describe all material terms of the relationship between the Property Owner and any such new merchant builder.
________________________________________________________________________ ________________________________________________________________________

V. Official Statement Updates

Unless such information has previously been included or incorporated by reference in a Semi-Annual Report, describe any other significant changes in the information relating to the Property Owner or the Property contained in the Official Statement under the heading [For the Master Developer: “PROPERTY OWNERSHIP AND DEVELOPMENT STATUS” (other than under the caption “Lennar Homes”);] [for Lennar: “PROPERTY OWNERSHIP AND DEVELOPMENT STATUS – Lennar Homes”] that would materially and adversely interfere with the Property Owner’s ability to develop and sell the Property as described in the Official Statement.

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VI. Status of Tax Payments

Describe status of payment of taxes, special taxes (including the Special Taxes) or assessments due with respect to the Property owned by the Property Owner and its Affiliates.

________________________________________________________________________ ________________________________________________________________________

VII. Other Material Information

In addition to any of the information expressly required above, provide such further information, if any, as may be necessary to make the specifically required statements, in the light of the circumstances under which they are made, not misleading.

________________________________________________________________________ ________________________________________________________________________

Certification

On behalf of the Property Owner, the undersigned officer or representative, based on actual knowledge after reasonable inquiry of employees of Property Owner and its affiliates, hereby certifies that this Semi-Annual Report constitutes the Semi-Annual Report required to be furnished by the Property Owner under the Disclosure Certificate.

ANY OTHER STATEMENTS REGARDING THE PROPERTY OWNER, THE
DEVELOPMENT OF THE PROPERTY, THE PROPERTY OWNER’S FINANCING PLAN OR

FINANCIAL CONDITION, OTHER THAN STATEMENTS MADE BY THE PROPERTY OWNER

IN AN OFFICIAL RELEASE, OR FILED WITH THE MUNICIPAL SECURITIES RULEMAKING BOARD, ARE NOT AUTHORIZED BY THE PROPERTY OWNER. THE PROPERTY OWNER

IS NOT RESPONSIBLE FOR THE ACCURACY, COMPLETENESS OR FAIRNESS OF ANY SUCH UNAUTHORIZED STATEMENTS.

THE PROPERTY OWNER HAS NO OBLIGATION TO UPDATE THIS SEMI-ANNUAL REPORT OTHER THAN AS EXPRESSLY PROVIDED IN THE DISCLOSURE CERTIFICATE.

Dated:

______________
a ______________

Name:

Title:

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G-1

APPENDIX G

FORM OF OPINION OF BOND COUNSEL

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H-1

APPENDIX H

APPRAISAL REPORT

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I-1

APPENDIX I

COMMUNITY FACILITIES DISTRICT BOUNDARY MAP

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Stradling Yocca Carlson & Rauth
Draft of 10/1/24

4881-8924-1309v5/200356-0613
$___________
IMPROVEMENT AREA NO. 1 OF THE
CITY OF FAIRFIELD COMMUNITY FACILITIES DISTRICT NO. 2023-1 (ONE LAKE PLANNING AREA 5)
SPECIAL TAX BONDS, SERIES 2024A

BOND PURCHASE AGREEMENT
October __, 2024
City of Fairfield
Fairfield, California
Ladies and Gentlemen:

Stifel, Nicolaus & Company, Incorporated (the “Underwriter”), acting not as a fiduciary or agent for you, but on behalf of itself, offers to enter into this Bond Purch ase Agreement (the “Purchase Agreement”) with the City of Fairfield (the “City”), acting on behalf of City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5) (the “District”) with respect to Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023 -1 (One Lake Planning Area 5) (“Improvement Area No. 1”), which, upon acceptance, will be binding upon the City and the Underwriter. This offer is made subject to acceptance by the City on the date hereof, and if not accepted will be subject to withdrawal by the Underwriter upon notice delivered to the City at any time prior to the acceptance hereof by the City.

The City acknowledges and agrees that: (a) the purchase and sale of the Bonds (as such term is defined herein) pursuant to this Purchase Agreement is an arm’s length commercial transaction between the City, on behalf of the District, and the Underwriter, and the only obligations that the Underwriter has to the City with respect to the transaction that is contemplated hereby expressly are set forth in this Purchase Agreement; (b) in connection therewith and with the discussions, undertakings and procedures leading up to the consummation of such transaction, the Underwriter is and has been acting solely as principal and is not acting as a Municipal Advisor (as such term is defined in Section 15B of The Securities Exchange Act of 1934, as amended) to the City; (c) the Underwriter has not assumed an advisory or fiduciary responsibility in favor of the Cit y with respect to the offering that is contemplated hereby or the discussions, undertakings and procedures leading thereto (irrespective of whether the Underwriter has provided other services or is currently providing other services to the City on other matters); (d) the Underwriter has financial and other interests that may differ from and be adverse to those of the City; and (e) the City has consulted its own legal, financial, accounting, tax and other advisors to the extent that it has deemed appropriate .

1. Purchase, Sale and Delivery of the Bonds.
(a) Subject to the terms and conditions and in reliance upon the representations, warranties and agreements that are set forth herein, the Underwriter agrees to purchase from the City, and the City agrees to sell to the Underwriter, all (but not less than all) of the Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023 -1 (One Lake Planning Area 5) Special Tax Bonds, Series 2024A (the “Bonds”) in the aggregate principal amount specifie d in Exhibit A. The Bonds shall be dated the Closing Date (as such term is defined herein), and bear Packet Page 343 of 530Attachment 4 Page 1 of 44

2 4881-8924-1309v5/200356-0613
interest from said date (payable semiannually on March 1 and September 1 of each year, commencing March 1, 2025) at the rates per annum and maturing on th e dates and in the amounts and subject to redemption as set forth in Exhibit A. The purchase price for the Bonds shall be the amount specified as such in Exhibit A.
(b) The Bonds shall be substantially in the form that is described in, shall be issued and secured under the provisions of, and shall be payable as provided in, the Fiscal Agent Agreement, dated as of November 1, 2024 (the “Fiscal Agent Agreement”), by and between the City and The Bank of New York Mellon Trust Company, N.A., as Fiscal Agent (the “Fiscal Agent”). The Fiscal Agent Agreement was approved by a resolution adopted by the City Council of the City (the “City Council”), as the legislative body of the District, on October 15, 2024, which resolution supplemented a resolution adopted by the City Council, as the legislative body of the District, on February 21, 2023. The City Council resolutions which were adopted by February 21, 2023 and October 15, 2024 relating to the Fiscal Agent Agreement are collectively referred to herein as the “Resolution of Issuance.” The Bonds and interest thereon will be payable from the proceeds of Special Taxes (as such term is defined in the Fiscal Agent Agreement) that are levied and collected on the taxable land within Improvement Area No. 1 in accordance with Resolution No. 2023-31, adopted by the City Council on February 21, 2023, forming the CFD and Improvement Area No. 1, as amended by Resolution No. _____, adopted by the City Council on October 15, 2024 (collectively, the “Resolution of Formation”) and any ordinance of the City Council of the City levying the Special Taxes, including but not limited to Ordinance No. 2023 -05, which was introduced by the City Council February 21, 2023 and adopted by the City Council on March 21, 2023 (collectively, the “Prior Ordinances”), and Ordinance No. 2024-____ (the “2024 Ordinance”), which was introduced by the City Council on October 15, 2024, and is anticipated to undergo second reading and be adopted by the City Council on November 19, 2024 (the 2024 Ordinance and the Prior Ordinances are collectively referred to as the “Ordinance”). Proceeds of the sale of the Bonds will be used in accordance with the Fiscal Agent Agreement and the Mello -Roos Community Facilities Act of 1982, as amended (Section 53311 et seq. of the Government Code of the State of California) (the “Law”), to acquire certain public improvements in the District, as described in the Resolution of Formation. The Prior Ordinances, the Resolution of Issuance, the Resolution of Formation and the Resolution of Necessity (as such term is defined in the Fiscal Agent Agreement) are collectively referred to herein as the “District Resolutions.” (c) Subsequent to its receipt of the certificate of the City (in substantially the form that is set forth in Exhibit B) deeming final the Preliminary Official Statement for the Bonds dated October __, 2024, (which Preliminary Official Statement, including the cover page and all appendices thereto, is herein referred to as the “Preliminary Official Statement”), for purposes of Rule 15c2-12 (“Rule 15c2-12”) promulgated by the Securities and Exchange Commission (the “SEC”), the Underwriter distributed copies of the Preliminary Official Statement. The City hereby ratifies the use by the Underwriter of the Preliminary Official Statement and authorizes the Underwriter to use and distribute the final Official Statement dated the date hereof (including all information that was previously permitted to have been omitted from the Preliminary Official Statement by Rule 15c2-12, and any supplements and amendments thereto as have been approved by the City, as evidenced by the execution and delivery of such document by an officer of the City, the “Official Statement”), the Fiscal Agent Agreement, the Continuing Disclosure Certificate of the City (the “City Disclosure Undertaking”), this Purchase Agreement, any other documents or contracts to which the City or the District is a party and all information contained therein, and all other documents, certificates and statements that are furnished by the City to the Underwriter in connection with the transactions that are contemplated by this Purchase Agreement, in connection with the offer and sale of the Bonds by Packet Page 344 of 530Attachment 4 Page 2 of 44

Fairfield City CouncilOctober 15, 2024

Fairfield City Council
October 15, 2024