Folsom City Council
April 12, 2022

04/12/2022 Item No.13.
( d) The Trustee will conclusively be deemed to have complied with the provisions of this Section and the provisions of the Tax Certificate and shall incur no liability if it follows the directions of the Authority set forth in the Tax Certificate and the Rebate Instructions and shall not be required to take any actions hereunder in the absence of Rebate Instructions from the Authority. (e) Notwithstanding any provision of this Section, if the Authority shall provide to the Trustee an Opinion of Bond Counsel that any specified action required under this Section is no longer required or that some further or different action is required to maintain the exclusion from gross income for federal income tax purposes of interest with respect to the Authority Bonds, the Trustee and the Authority and the Community Facilities District may conclusively rely on such opinion in complying with the requirements of this Section, and the covenants hereunder shall be deemed to be modified to that extent.
(f) The provisions of this Section shall survive the defeasance of the Authority Bonds.

SECTION 7.05. Maintenance of Existence. The Authority shall maintain the existence, powers and authority of the Authority as a joint exercise of powers authority under the laws of the State.

SECTION 7.06. Continuing Disclosure. The Community Facilities District has undertaken all responsibility for compliance with continuing disclosure requirements, and the Authority shall have no liability to the Owners of the Authority Bonds or any other person with respect to S.E.C. Rule 15c2-12. Notwithstanding any other provision hereof, failure of the Community Facilities District to comply with any continuing disclosure obligation shall not be considered an Event of Default; provided, that any Owners of the Authority Bonds or beneficial owner may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Community Facilities District to comply with its continuing disclosure obligations.

SECTION 7.07. Redemption Fund for the Local Obligations. (a) The Community Facilities District expressly acknowledges that, pursuant to the Local Obligations Indenture, the Community Facilities District is to establish and maintain a separate redemption fund for the Local Obligations (the "Local Obligations Redemption Fund") and, so long as the Local Obligations remain outstanding, to deposit into such Local Obligations Redemption Fund, upon receipt, any and all Special Tax Revenues received by the Community Facilities District in connection with the Local Obligations. The Community Facilities District further acknowledges that no temporary loan or other use whatsoever may be made of Special Tax Revenues, and that the Local Obligations Redemption Fund constitutes a trust fund for the benefit of the owners of the Local Obligations.
(b) The Community Facilities District hereby covenants for the benefit of the Authority, as owner of the Local Obligations, the Trustee, as assignee of the Authority with respect to the Revenues, and the Owners from time to time of the Authority Bonds, that it will establish, maintain and administer the Local Obligations Redemption Fund and the Special Tax Revenues in accordance with their status as trust funds as prescribed by the Act, the Local Obligations Indenture and this Trust Agreement.
27 4149-1157-6629.3

04/12/2022 Item No.13.
( c) The Community Facilities District further covenants that, no later than one (1) Business Day prior to each Interest Payment Date and Principal Payment Date of the Authority Bonds, the Community Facilities District will advance to the Trustee against payment on the Local Obligations, as assignee of the Authority with respect to the Local Obligations, the interest due on the Local Obligations on such Interest Payment Date and the principal of all Local Obligations maturing on such Principal Payment Date, respectively, and upon receipt by the Trustee, such amounts shall constitute Revenues. For so long as Authority Bonds remain Outstanding, the Trustee shall provide written notice to the Authority no later than fifteen (15) days prior to each Interest Payment Date specifying the amount required to be paid to the Trustee pursuant to this subsection in the month subsequent thereto.

SECTION 7.08.
warrants as follows:

Concerning the Trust Estate. The Authority hereby represents and (a) This Trust Agreement creates a valid and binding pledge of and security interest in the Trust Estate in favor of the Trustee in order to secure the payment of the interest on and principal of and redemption premiums, if any, on all Authority Bonds Outstanding hereunder, enforceable by the Trustee in accordance with the terms hereof. (b) Under the laws of the State of California, (1) such pledge of and security interest in the Trust Estate and (2) each pledge, assignment, lien, or other security interest made to secure any prior obligations of Authority which, by the terms hereof, ranks on parity with or prior to the pledge of and security interest granted hereby, are and shall be prior to any judicial lien hereafter imposed on such collateral to enforce a judgment against the Authority on a simple contract. ( c) The Authority has not heretofore made a pledge of, granted a lien on or security interest in, or made an assignment or sale of the Trust Estate that ranks on parity with or prior to the pledge and security interest granted hereby, except for the pledge and security interest granted to secure the Authority Bonds. The Authority shall not hereafter make or suffer to exist any pledge or assignment of, lien on, or security interest in such collateral that ranks prior to or on parity with the pledge and security interest granted hereby, or file any financing statement describing any such pledge, assignment, lien or security interest, except as expressly permitted hereby.

ARTICLE VIII

DEF AUL TS AND REMEDIES
SECTION 8.01.

Default" hereunder:

Events of Default. The following shall constitute "Events of (a) if payment of interest on the Authority Bonds shall not be made when due; or (b) if payment of any Principal Installment or Minimum Sinking Fund Payment shall not be made when due and payable, whether at maturity, by proceedings for redemption, or otherwise; or
( c) if the Authority or the Community Facilities District shall fail to observe or perform in any material way any other agreement, condition, covenant or term contained herein on its part 28 4149-1157-6629.3

04/12/2022 Item No.13.
to be observed or performed, and such failure shall continue for thirty (30) days after written notice specifying such failure and requiring the same to be remedied shall have been given to the Authority or the Community Facilities District, as the case may be, by the Trustee or by the Owners of not less than fifty percent (50%) in aggregate principal amount of the Authority Bonds, provided, that if such default be such that it cannot be corrected within the applicable period, it shall not constitute an Event of Default if corrective action is instituted by the Authority or the Community Facilities District within the applicable period and diligently pursued until the default is corrected; or
( d) if there is an event of default under the Local Obligations Indenture.

SECTION 8.02. Proceedings by Trustee; No Acceleration. Upon the happening and continuance of any Event of Default the Trustee may, or at the written request of the Owners of not less than fifty percent (50%) in aggregate principal amount of Authority Bonds Outstanding, shall (but only if indemnified to its satisfaction from any liability, expense or cost), do the following:
(a) by mandamus, or other suit, action or proceeding at law or in equity, enforce all rights of the Owners, including the right to receive and collect the Revenues; (b) bring suit upon or otherwise enforce any defaulting Local Obligation; (c) by action or suit in equity enjoin any acts or things which may be unlawful or in violation of the rights of the Owners;
( d) as a matter of right, have a receiver or receivers appointed for the Trust Estate and of the earnings, income, issues, products, profits and revenues thereof pending such proceedings, with such powers as the court making such appointment shall confer; and ( e) take such action with respect to any and all Local Obligations or Investment Securities as shall be necessary and appropriate, subject to Section 8.04 and to the terms of such Local Obligations or Investment Securities.

The Trustee shall have no right to declare the principal of all of the Authority Bonds then Outstanding, or the interest accrued thereon, to be due and payable immediately.

SECTION 8.03. Effect of Discontinuance or Abandonment. In case any proceeding taken by the Trustee on account of any Event of Default shall have been discontinued or abandoned for any reason, or shall have been determined adversely to the Trustee, then and in every such case the Trustee and the Owners shall be restored to their former positions and rights hereunder, respectively, and all rights, remedies and powers of the Trustee shall continue as though no such proceeding had been taken.

SECTION 8.04. Rights of Owners. Anything herein to the contrary notwithstanding, but subject to the limitations and restrictions as to the rights of the Owner contained in Sections

8.01, 8.02, and 8.05, upon the happening and continuance of any Event of Default, the Owners of not less than fifty percent (50%) in aggregate principal amount of the Authority Bonds then Outstanding shall have the right, upon providing the Trustee security and indemnity reasonably 29 4149-1157-6629.3

04/12/2022 Item No.13.
satisfactory to it against the costs, expenses and liabilities to be incurred therein or thereby, by an instrument in writing executed and delivered to the Trustee, have the right to direct the method and place of conducting all remedial proceedings to be taken by the Trustee hereunder.

The Trustee may refuse to follow any direction that conflicts with law or herewith or that the Trustee determines would subject the Trustee to personal liability without adequate indemnification therefor.

SECTION 8.05. Restriction on Owner's Action. In addition to the other restrictions on the rights of Owners to request action upon the occurrence of an Event of Default and to enforce remedies set forth in this Article, no Owner shall have any right to institute any suit, action or proceeding in equity or at law for the enforcement of any trust hereunder, or any other remedy hereunder or in the Authority Bonds, unless such Owner previously shall have given to the Trustee written notice of an Event of Default as hereinabove provided and unless the Owners of not less than fifty percent (50%) in aggregate principal amount of the Authority Bonds then Outstanding shall have made written request of the Trustee to institute any such suit, action, proceeding or other remedy, after the right to exercise such powers or rights of action, as the case may be, shall have accrued, and shall have afforded the Trustee a reasonable opportunity either to proceed to exercise the powers granted herein, or to institute such action, suit or proceeding in its or their name; nor unless there also shall have been offered to the Trustee security and indemnity reasonably satisfactory to it against the costs, expenses and liabilities to be incurred therein or thereby, and the Trustee shall not have complied with such request within a reasonable time; and such notification, request and offer of indemnity are hereby declared in every such case to be conditions precedent to the execution of the trusts hereof or for any other remedy hereunder, it being understood and intended that no one or more Owners of Authority Bonds secured hereby shall have any right in any manner whatever by his, her or their action to affect, disturb or prejudice the security hereof, or to enforce any rights hereunder or under the Authority Bonds, except in the manner provided herein, and that all proceedings at law or in equity shall be instituted, had and maintained in the manner provided herein, and for the equal benefit of all Owners of Outstanding Authority Bonds; subject, however, to the provisions of this Section. Notwithstanding the foregoing provisions of this Section or any other provision hereof, the obligation of the Authority shall be absolute and unconditional to pay, but solely from the Trust Estate, the interest on and principal of and redemption premiums, if any, on the Authority Bonds to the respective Owners thereof at the respective due dates thereof, and nothing herein shall affect or impair the right of action, which is absolute and unconditional, of such Owners to enforce such payment.

SECTION 8.06. Power of Trustee to Enforce. All rights of action hereunder or under any of the Authority Bonds secured hereby which are enforceable by the Trustee may be enforced by it without the possession of any of the Authority Bonds, or the production thereof at the trial or other proceedings relative thereto, and any such suit, action or proceedings instituted by the Trustee shall be brought in its own name, as Trustee, for the equal and ratable benefit of the Owners subject to the provisions hereof.

SECTION 8.07. Remedies Not Exclusive. No remedy herein conferred upon or reserved to the Trustee or to the Owners is intended to be exclusive of any other remedy or remedies, and each and every such remedy shall be cumulative, and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute. 30 4149-1157-6629.3

04/12/2022 Item No.13.

SECTION 8.08. Waiver of Events of Default; Effect of Waiver. Upon the written request of the Owners of at least a majority in aggregate principal amount of all Outstanding Authority Bonds, the Trustee shall waive any Event of Default hereunder and its consequences. If any Event of Default shall have been waived as herein provided, the Trustee shall promptly give written notice of such waiver to the Authority and the Community Facilities District and shall give notice thereof by first class mail, postage prepaid, to all Owners of Outstanding Authority Bonds if such Owners had not previously been given notice of such Event of Default; but no such waiver, rescission and annulment shall extend to or affect any subsequent Event of Default, or impair any right or remedy consequent thereon.

No delay or omission of the Trustee or of any Owner to exercise any right or power accruing upon any Event of Default shall impair any such right or power or shall be construed to be a waiver of any such Event of Default, or an acquiescence therein; and every power and remedy given by this Article to the Trustee and to the Owners may be exercised from time to time and as often as may be deemed expedient.

SECTION 8.09. Application of Money upon Event of Default. Any money received by the Trustee pursuant to this Article shall, after payment of all fees and expenses of the Trustee, and the fees and expenses of its counsel incurred in representing the Owners, be applied as follows:
(a)
payable,
unless the principal of all of the Outstanding Authority Bonds shall be due and FIRST - To the payment of the Owners entitled thereto of all installments of interest then due on the Authority Bonds, in the order of the maturity of the installments of such interest, and if the amount available shall not be sufficient to pay in full any particular installment, then to the payment ratably, according to the amounts due on such installment, to the Persons entitled thereto, without any discrimination or privilege;
SECOND - To the payment of the Owners entitled thereto of the unpaid principal of and redemption premiums, if any, on any of the Authority Bonds which shall have become due ( other than Authority Bonds matured or called for redemption for the payment of which money is held pursuant to the provisions hereof) in the order of their due dates, and if the amount available shall not be sufficient to pay in full the principal of and redemption premiums, if any, on such Authority Bonds due on any particular date, then to the payment ratably, according to the amount due on such date, to the Owners entitled thereto without any discrimination or privilege; and
THIRD - To be held for the payment to the Owners entitled thereto as the same shall become due of the interest on and principal of and redemption premiums, if any, on the Authority Bonds which may thereafter become due, either at maturity or upon call for redemption prior to maturity, and if the amount available shall not be sufficient to pay in full such interest and principal and redemption premiums, if any, due on any particular date, payment shall be made in accordance with the FIRST and SECOND paragraphs hereof.
31 4149-1157-6629.3

04/12/2022 Item No.13.
(b) if the principal of all of the Outstanding Authority Bonds shall be due and payable, to the payment of the interest on and principal of and redemption premiums, if any, due on all Outstanding Authority Bonds without preference or priority of or of any interest on any Outstanding Authority Bond over any other Outstanding Authority Bond, any principal of or the redemption premium, if any, on any Outstanding Authority Bond or of any other Outstanding Authority Bond, ratably, according to the amounts due respectively for interest and principal and redemption premiums, if any, to the Owners entitled thereto without any discrimination or preference except as to any difference in the respective amounts of interest specified in the Outstanding Authority Bonds.

ARTICLE IX

THE TRUSTEE
SECTION 9.01. Appointment and Acceptance of Duties. The Trustee hereby accepts and agrees to the trusts hereby created to all of which the Authority agrees and the respective Owners of the Authority Bonds, by purchase and acceptance thereof, agrees.

SECTION 9.02. Duties, Immunities and Liability of Trustee. The Trustee shall, prior to an Event of Default, and after the curing or waiver of all Events of Default which may have occurred, perform such duties and only such duties as are specifically set forth herein, and no implied duties or obligations shall be read herein against the Trustee. The Trustee shall, during the existence of any Event of Default (which has not been cured or waived), exercise such of the rights and powers vested in it hereby and use the same degree of care and skill in their exercise as a prudent person would exercise under the circumstances in the conduct of his or her own affairs.

In the absence of an Event of Default, the Authority may remove the Trustee. The Authority shall remove the Trustee if (A) it receives an instrument or concurrent instruments in writing signed by the Owners of not less than a majority in aggregate principal amount of the Authority Bonds then Outstanding ( or their attorneys duly authorized in writing) or (B) at any time the Trustee shall cease to be eligible in accordance with this Section, or (C) the Trustee shall become incapable of acting, or (D) the Trustee shall commence a case under any bankruptcy, insolvency or similar law, or (E) a receiver of the Trustee or of its property shall be appointed, or (F) any public officer shall take control or charge of the Trustee or its property or affairs for the purpose of rehabilitation, conservation or liquidation. To effect any such removal, the Authority shall give written notice thereof to the Trustee, and thereupon the Authority (with the concurrence of the Community Facilities District) shall promptly appoint a successor Trustee by an instrument in writing.

The Trustee may, subject to the next following paragraph of this Section, resign by giving written notice of such resignation by mail, first class postage prepaid, to the Authority, the Community Facilities District and the Owners at the respective addresses listed in the Bond Register. Upon receiving such notice of resignation, the Authority (with the concurrence of the Community Facilities District) shall promptly appoint, by an instrument in writing, a successor Trustee.
32 4149-1157-6629.3

04/12/2022 Item No.13.

Any removal or resignation of the Trustee and appointment of a successor Trustee shall become effective only upon acceptance of the successor Trustee by the Authority and the Community Facilities District and acceptance of appointment by the successor Trustee. If no successor Trustee shall have been appointed and shall have accepted appointment within thirty (30) days of giving notice of removal or notice of resignation as aforesaid, the resigning Trustee or any Owner ( on behalf of himself and all other Owners) may petition, at the expense of the Community Facilities District, any court of competent jurisdiction for the appointment of a successor Trustee, and such court may thereupon, after such notice (if any) as it may deem proper, appoint such successor Trustee. Any successor Trustee appointed under this Trust Agreement shall signify its acceptance of such appointment by executing and delivering to the Authority and the Community Facilities District and to its predecessor Trustee a written acceptance thereof, and thereupon such successor Trustee, without any further act, deed or conveyance, shall become vested with all the money, estates, properties, rights, powers, trusts, duties and obligations of such predecessor Trustee, with like effect as if it were originally named Trustee herein; but, nevertheless, at the written request of the Authority or the Community Facilities District or the successor Trustee, such predecessor Trustee shall execute and deliver any and all instruments of conveyance or further assurance and do such other things as may reasonably be required for more fully and certainly vesting in and confirming to such successor Trustee all the right, title and interest of such predecessor Trustee in and to any property held by it hereunder and shall pay over, transfer, assign and deliver to the successor Trustee any money or other property subject to the trusts and conditions herein set forth. Upon request of the successor Trustee, the Authority and the Community Facilities District shall execute and deliver any and all instruments as may be reasonably required for more fully and certainly vesting in and confirming to such successor Trustee all such money, estates, properties, rights, powers, trusts, duties and obligations. Upon acceptance of appointment by a successor Trustee as provided in this subsection, such successor Trustee shall mail a notice of the succession of such successor Trustee to the trusts hereunder by first class mail, postage prepaid, to the Owners at their respective addresses listed in the Bond Register.

Any successor Trustee appointed under the provisions of this Section shall be a trust company or bank having the powers of a trust company, having a designated corporate trust office in California, and with a combined capital and surplus of at least one hundred million dollars ($100,000,000) and being subject to supervision or examination by federal or state authority; and if such bank or trust company publishes a report of condition at least annually, pursuant to law or to the requirements of any supervising or examining authority above referred to, then for the purpose of this subsection the combined capital and surplus of such bank or trust company shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. In case at any time the Trustee shall cease to be eligible in accordance with the provisions of this subsection, the Trustee shall resign promptly in the manner and with the effect specified in this Section.

No provision herein shall require the Trustee to risk or expend its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder unless the Owners shall have offered to the Trustee indemnity it deems reasonable, against the costs, expenses and liabilities that may be incurred. The Trustee shall be entitled to interest on all money advanced by it hereunder at its prime rate then in effect plus two percent (2%), but not to exceed the maximum interest rate permitted by the laws of the State. 33 4149-1 I 57-6629.3

04/12/2022 Item No.13.

In accepting the trust hereby created, the Trustee is acting solely as Trustee for the Owners and not in its individual capacity, and under no circumstances shall the Trustee be liable in its individual capacity for the obligations evidenced by the Authority Bonds.

The Trustee makes no representation or warranty, express or implied, as to the compliance with legal requirements of the use contemplated by the Authority or the Community Facilities District of the funds hereunder including, without limitation, the purchase of the Local Obligations hereunder; provided, that the Trustee shall not acquire Local Obligations other than pursuant to the provisions of Sections 5.03 and 5.04.

In no event shall the Trustee be responsible or liable for special, indirect, punitive or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action.

The Trustee shall not be responsible for the validity or effectiveness or value of any collateral or security securing any Local Obligation. The Trustee shall not be responsible for the recording or filing of any document relating hereto or any Local Obligation or of financing statements (or amendments or continuation statements in connection therewith) or mortgage or of any supplemental instruments or documents of further assurance as may be required by law in order to perfect the security interests or lien on or in any collateral or security securing any Local Obligation. The Trustee shall not be deemed to have made representations as to the security afforded thereby or as to the validity or sufficiency of any such document, collateral or security.

The Trustee shall not be deemed to have knowledge of any Event of Default hereunder unless and until a Responsible Officer of the Trustee shall have actual knowledge thereof at its Corporate Trust Office.

The Trustee shall not be accountable for the use or application by the Authority or the Community Facilities District or any other party of any funds which the Trustee has released hereunder.

The Trustee shall provide a monthly accounting of all funds held pursuant hereto to the Authority within fifteen (15) Business Days after the end of such month and shall provide statements of account for each annual period beginning July 1 and ending June 30, within ninety (90) days after the end of such period. Such accounting shall show in reasonable detail all financial transactions during the accounting period and the balance in any accounts and funds (including the Local Obligations Fund) created hereunder as of the beginning and the close of such accounting period.

The Trustee shall furnish the Authority periodic cash transaction statements which include detail for all investment transactions effected by the Trustee or brokers selected by the Authority. Upon the Authority's election, such statements will be delivered via the Trustee's online service and upon electing such service, paper statements will be provided only upon request. The Authority waives the right to receive brokerage confirmations of security transactions effected by the Trustee as they occur, to the extent permitted by law. The Authority further understands that trade confirmations for securities transactions effected by the Trustee will be available upon 34 4149-1157-6629.3

04/12/2022 Item No.13.
request and at no additional cost and other trade confirmations may be obtained from the applicable broker.

SECTION 9.03. Merger or Consolidation. Any company into which the Trustee may be merged or converted or with which it may be consolidated or any company resulting from any merger, conversion or consolidation to which it shall be a party or any company to which the Trustee may sell or transfer all or substantially all of its corporate trust business shall succeed to the rights and obligations of the Trustee without the execution or filing of any paper or any further act, anything herein to the contrary notwithstanding; provided, that such company shall be eligible under Section 9.02.

SECTION 9.04. Compensation and Indemnification. The Authority shall pay or cause the Community Facilities District to pay the Trustee such compensation, as shall be agreed in writing, for its services rendered hereunder and reimburse the Trustee for reasonable expenses, disbursements and advances, including attorneys' fees and expenses, incurred by the Trustee in the performance of its obligations hereunder and with respect to the Local Obligations.

The Authority agrees, to the extent permitted by law, to indemnify the Trustee and its officers, directors, employees, attorneys and agents for, and to hold it harmless against, any loss, liability, claim or expense incurred without negligence or willful misconduct on its part arising out of or in connection with (i) the acceptance or administration of .the trusts imposed hereby, including performance of its duties hereunder, including the costs and expenses of defending itself against any claims (whether asserted by the City or any other Person) or liability in connection with the exercise or performance of any of its powers or duties hereunder (including this Section 9.04), (ii) the projects to be financed with the purchase of the Local Obligations; (iii) the sale of any Authority Bonds or the purchase of the Local Obligations and the carrying out of any of the transactions contemplated by the Authority Bonds or the Local Obligations; or (iv) any untrue statement of any material fact or omission to state a material fact necessary to make the statements made, in light of the circumstances under which they were made, not misleading in any official statement or other disclosure document utilized by the Authority or the Community Facilities District in connection with the sale of the Authority Bonds or the Local Obligations. The Authority's obligations hereunder with respect to indemnity of the Trustee and the provision for its compensation set forth in this Article shall survive and remain valid and binding notwithstanding the maturity and payment of the Authority Bonds, or the resignation or removal of the Trustee.

The Trustee shall have no responsibility for or liability in connection with assuring that all of the procedures or conditions to closing set forth in the contract of purchase for the sale of the Authority Bonds, that all documents required to be delivered on the closing date to the parties are actually delivered, except its own responsibility to receive or deliver the proceeds of the sale, deliver the Authority Bonds and other certificates expressly required to be delivered by it and its counsel.

The Trustee shall not be responsible for determining or investigating whether any Local Obligation purchased pursuant to Section 5.03 is a Local Obligation, as defined herein, and the Trustee may conclusively rely on the Authority's determination and direction in this regard; provided, that the Trustee shall not acquire the Local Obligations other than pursuant to the 35 4149-1157-6629.3

04/12/2022 Item No.13.
provisions of Section 5.03. The Trustee shall be entitled to rely conclusively on the covenants, representations and warranties of each obligor on any Local Obligation and in the documents and certificates delivered in connection therewith and each Written Order.

SECTION 9.05. Liability of Trustee. The recitals of facts herein and in the Authority Bonds contained shall be taken as statements of the Authority or the Community Facilities District, and the Trustee does not assume any responsibility for the correctness of the same, and does not make any representations as to the validity or sufficiency hereof or of the Authority Bonds, and shall not incur any responsibility in respect thereof, other than in connection with the duties or obligations herein or in the Authority Bonds assigned to or imposed upon it; provided, that the Trustee shall be responsible for its representations contained in its certificate of authentication on the Authority Bonds. The Trustee shall not be liable in connection with the performance of its duties hereunder except for its own negligence or willful misconduct. The Trustee (in its individual or any other capacity) may become the Owner of Authority Bonds with the same rights it would have if it were not Trustee hereunder, and, to the extent permitted by law, may act as depositary for and permit any of its officers, directors and employees to act as a member of, or in any other capacity with respect to, any committee formed to protect the rights of Owners, whether or not such committee shall represent the Owners of a majority in principal amount of the Authority Bonds then Outstanding. The Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Owners of a majority in principal amount of the Outstanding Authority Bonds relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee hereunder. Whether or not therein expressly so provided, every provision hereof or related documents relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Article.

SECTION 9.06. Right to Rely on Documents; Adverse Effect Determinations. The Trustee may conclusively rely on and shall be protected in acting or refraining from acting upon any notice, resolution, requisition, request, consent, order, certificate, report, opinion, bond or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties. The Trustee may consult with counsel of its selection, who may be. counsel of or to the Authority, with regard to legal questions, and the opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered or omitted by it hereunder in good faith and in accordance therewith.

Whenever in the administration of the trusts imposed upon it hereby the Trustee shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering or omitting any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by an Officer's Certificate, and such Officer's Certificate shall be full warrant to the Trustee for any action taken or suffered or omitted in good faith under the provisions hereof in reliance upon such Officer's Certificate, but the Trustee may, in lieu thereof, accept other evidence of such matter or may require such additional evidence as to it may seem reasonable. 36 4149-1157-6629.3

04/12/2022 Item No.13.

The Trustee shall be entitled to advice of counsel of its selection and other professionals or agents concerning all matters of trust and its duty hereunder, but the Trustee shall not be answerable or liable for the acts or omissions of any agent, attorney-at-law, certified public accountant, or other professional if such agent, attorney-at-law, certified public accountant or other professional was selected by the Trustee with due care.

SECTION 9.07. Preservation and Inspection of Documents. All documents received by the Trustee under the provisions hereof shall be retained in its possession in accordance with its record retention policies and shall be subject at all reasonable times upon prior written notice to the inspection of the Authority, the Owners of not less than a majority of the aggregate principal amount of the Outstanding Authority Bonds, and their agents and representatives duly authorized in writing, at reasonable hours and under reasonable conditions.

SECTION 9.08. Indemnity for Trustee. Before taking any action or exercising any rights or powers hereunder, the Trustee may require that satisfactory indemnity be furnished to it for the reimbursement of any and all costs, claims and expenses which it may incur and to indemnify it against any and all liability, except liability which may result from its negligence or willful misconduct, by reason of any action so taken.

ARTICLEX

EXECUTION OF INSTRUMENTS BY OWNERS AND

PROOF OF OWNERSHIP OF AUTHORITY BONDS
SECTION 10.01. Execution of Instruments; Proof of Ownership. Any request, direction, consent or other instrument in writing required or permitted hereby to be signed or executed by Owners may be in any number of concurrent instruments of similar tenor by different parties and may be signed or executed by such Owners in person or by agent appointed by an instrument in writing. Proof of the execution of any such instrument and of the ownership of Authority Bonds shall be sufficient for any purpose hereof and shall be conclusive in favor of the Trustee with regard to any action taken, suffered or omitted by either of them under such instrument if made in the following manner:
(a) The fact and date of the execution by any Person of any such instrument may be proved by the certificate of any officer in any jurisdiction who, by the laws thereof, has power to take acknowledgments within such jurisdiction, to the effect that the Person signing such instrument acknowledged before him or her the execution thereof, or by an affidavit of a witness to such execution.
(b) The fact of the ownership of Authority Bonds hereunder by any Owner and the serial numbers of such Authority Bonds and the date of his ownership of the same shall be proved by the Bond Register.

Nothing contained in this Article shall be construed as limiting the Trustee to such proof, it being intended that the Trustee may accept any other evidence of the matters in this Article stated which shall be sufficient. Any request or consent of the Owner shall bind every future Owner of such Authority Bond and any Authority Bond or Authority Bonds issued in exchange or substitution therefor or upon the registration of transfer thereof in respect of anything done by the Trustee in pursuance of such request or consent.
37 4149-1157-6629.3

04/12/2022 Item No.13.

ARTICLE XI

SUPPLEMENTAL TRUST AGREEMENTS
SECTION 11.01. Supplemental Trust Agreements with Consent of Owners. Any modification or alteration hereof or of the rights and obligations of the Authority, the Community Facilities District or the Owners may be made with the consent of the Owners of not less than a majority in aggregate principal amount of the Authority Bonds then Outstanding; provided, that no such modification or alteration shall be made which will reduce the percentage of aggregate principal amount of Authority Bonds the consent of the Owners of which is required for any such modification or alteration or permit the creation by the Authority or the Community Facilities District of any lien prior to or on parity with the lien hereof upon the Trust Estate or which will affect the times, amounts and currency of payment of the interest on or principal of or redemption premiums, if any, on the Authority Bonds or affect the rights, duties or obligations of the Trustee without the consent of the party affected thereby.

SECTION 11.02. Supplemental Trust Agreements Without Consent of Owners. The Authority and the Community Facilities District may, without the consent of the Owners, enter into a Supplemental Trust Agreement or Supplemental Trust Agreements, which thereafter shall form a part of this Trust Agreement, for any one or more of the following purposes:
(a) to add to the agreements and covenants of the Authority or the Community Facilities District contained herein other agreements and covenants thereafter to be observed, or to surrender any right or power herein reserved to or conferred upon the Authority or the Community Facilities District; provided, that no such agreement, covenant or surrender shall materially adversely affect the rights of any Owner;
(b) to cure any ambiguity, to supply any omission or to cure, correct or supplement any defect or inconsistent provisions contained herein or in any Supplemental Trust Agreement; ( c) to make any change which does not materially adversely affect the rights of any Owner;
( d) to grant to the Trustee for the benefit of the Owners additional rights, remedies, powers or authority;
( e) to subject hereto additional collateral or to add other agreements of the Authority or the Community Facilities District;
(f) to modify this Trust Agreement or the Authority Bonds to permit qualification hereof under the Trust Indenture Act of 1939, as amended, or any similar statute at the time in effect, or to permit the qualification of the Authority Bonds for sale under the securities laws of any state of the United States of America;
(g) to make any amendments or supplements necessary or appropriate to preserve or protect the exclusion from gross income for federal income tax purposes under the Code of the interest on the Authority Bonds or the exemption of interest on the Authority Bonds from State personal income taxes; or
38 4149-1157-6629.3

04/12/2022 Item No.13.
(h) to evidence the succession of a successor Trustee.

For all purposes of this Section, the Trustee shall be entitled to conclusively rely upon and shall be fully protected in relying upon an Opinion of Bond Counsel with respect to the extent, if any, to which any action affects the rights hereunder of any Owner.

SECTION 11.03. Trustee Authorized to Enter into Supplemental Trust Agreements.

The Trustee is hereby authorized to enter into any Supplemental Trust Agreement with the Authority and the Community Facilities District authorized or permitted by the terms hereof, and to make the further agreements and stipulations which may be therein contained, and for all purposes of this Section the Trustee shall be entitled to conclusively rely upon and shall be fully protected in relying upon an Opinion of Bond Counsel to the effect that such Supplemental Trust Agreement is authorized or permitted by the provisions hereof.

ARTICLE XII

DEFEASANCE
SECTION 12.01. Defeasance. If and when the Authority Bonds secured hereby shall become due and payable in accordance with their terms or through redemption proceedings as provided herein, or otherwise, and the whole amount of the interest on and principal ofredemption premiums, if any, so due and payable upon all of the Authority Bonds shall have been paid, or provision shall have been made for the payment of the same, together with all other sums payable hereunder by the Authority, including all fees and expenses of the Trustee, then and in that case, this Trust Agreement and the lien created hereby shall be completely discharged and satisfied and the Authority and the Community Facilities District shall be released from the respective agreements, conditions, covenants and terms of the Authority and the Community Facilities District contained herein, and the Trustee shall assign and transfer all property (in excess of the amounts required for the foregoing) then held by the Trustee free and clear of any encumbrances as provided in Section 12.04 and shall execute such documents as may be reasonably required by the Authority or the Community Facilities District in this regard.

Notwithstanding the satisfaction and discharge hereof, those provisions of this Trust Agreement relating to the maturity of the Authority Bonds, interest payments and dates thereof, exchange and transfer of Authority Bonds, replacement of mutilated, destroyed, lost or stolen Authority Bonds, the safekeeping and cancellation of Authority Bonds, nonpresentment of Authority Bonds, and the duties of the Trustee in connection with all of the foregoing, shall remain in effect and shall be binding upon the Trustee and the Owner, and the Trustee shall, subject to Section 13.06, continue to be obligated to hold in trust any money or investments then held by the Trustee for the payment of the interest on and principal of and redemption premiums, if any, on the Authority Bonds, to pay to the Owner of Authority Bonds the funds so held by the Trustee as and when such payments become due, and those provisions hereof contained in Section 9.04 relating to the compensation and indemnification of the Trustee and in Section 7.04 relating to the tax covenants of the Authority and the Community Facilities District shall remain in effect and shall be binding upon the Trustee, the Authority and the Community Facilities District. 39 4149-1157-6629.3

04/12/2022 Item No.13.

SECTION 12.02. Authority Bonds Deemed to Have Been Paid. If any money shall have been set aside and held by the Trustee for the payment or redemption of any Authority Bonds and the interest installments therefor at the maturity thereof or date fixed for redemption, such Authority Bonds shall be deemed to be paid within the meaning and with the effect provided in Section 12.01. Any Outstanding Bond shall prior to the maturity or redemption date thereof be deemed to have been paid within the meaning and with the effect expressed in Section 12.01 if (a) in case any Authority Bonds are to be redeemed on any date prior to their maturity, the Authority shall have given to the Trustee irrevocable instructions to mail notice of redemption of such Authority Bonds on such redemption date, such notice to be given in accordance with the provisions of Article IV, (b) there shall have been deposited with the Trustee in escrow either (i) money in an amount which shall be sufficient to pay when due the interest on and principal of and redemption premiums, if any, due and to become due on such Authority Bonds on and prior to the date scheduled for redemption or maturity date thereof, as the case may be, or (ii) noncallable Government Obligations the principal of and the interest on which when due, and without any reinvestment thereof, will provide money which, together with the money, if any, deposited with or held by the Trustee at the same time, shall be sufficient as verified by a report of a nationally recognized independent certified public accountant to pay when due the interest on and principal of and redemption premiums, if any, due and to become due on such Authority Bonds on and prior to the date fixed for redemption or maturity date thereof, as the case may be, and ( c) in the event any of such Authority Bonds are not to be redeemed within the next succeeding sixty ( 60) days, the Authority shall have given the Trustee irrevocable instructions to mail, as soon as practicable in the same manner as a notice of redemption is mailed pursuant to Article IV, a notice to the Owners of such Authority Bonds that the deposit required by (b) above has been made with the Trustee and that such Authority Bonds are deemed to have been paid in accordance with this Section and stating the maturity dates or redemption dates upon which money is to be available for the payment of the interest on and principal of and redemption premiums, if any, on such Authority Bonds. Neither the securities nor money deposited with the Trustee pursuant to this Section nor interest or principal payments on any such securities shall be withdrawn or used for any purpose other than, and shall be held in trust for, the payment of the interest on and principal of and redemption premiums, if any, on such Authority Bonds; provided, that any cash received from such interest or principal or interest payments on such obligations deposited with the Trustee, if not then needed for such purpose, shall, to the extent practicable and at the written direction of the Authority, be reinvested in Government Obligations, such written direction to specify which Government Obligations are to be invested in, maturing at times and in amounts, together with the other money and payments with respect to Government Obligations then held by the Trustee pursuant to this Section, sufficient to pay when due the interest on and principal of and redemption premiums, if any, to become due on such Authority Bonds on and prior to such redemption date or maturity date thereof, as the case may be, and interest earned from such reinvestments shall, upon receipt by the Trustee of a Written Order so directing, be paid over to the Authority as received by the Trustee free and clear of any trust, lien or pledge. 40 4149-1157-6629.3

04/12/2022 Item No.13.

SECTION 12.03. Money Held for Particular Authority Bonds. Except as otherwise provided in Section 12.02 or 13.06, the amounts held by the Trustee for the payment of the interest on or principal of the redemption premiums, if any, or the interest due on any date with respect to particular Authority Bonds shall, on and after such date and pending such payment, be set aside on its books and held in trust by it solely for the Owners entitled thereto.

SECTION 12.04. Effect of Defeasance of Authority Bonds. Notwithstanding any other provision hereof, in the event that the Authority Bonds are defeased and the obligations hereunder are discharged pursuant to this Article, the Trustee shall transfer all property and money held by the Trustee (including, without limitation, the Local Obligations), to or upon the written order of the Authority.

ARTICLE XIII

MISCELLANEOUS
SECTION 13.01. Dissolution of Authority. In the event of the dissolution of the Authority, all the agreements, conditions, covenants and terms contained herein by or on behalf of, or for the benefit of, the Authority shall bind or inure to the benefit of the successors of the Authority from time to time and any officer, board, commission, agency or instrumentality to whom or to which any power or duty of the Authority shall be transferred.

SECTION 13.02. Parties Interested Herein. Except as otherwise specifically provided herein, nothing contained herein, expressed or implied, is intended or shall be construed to confer upon any Person other than the Authority, the Community Facilities District, the Trustee and the Owners any right, remedy or claim under or by reason hereof, this Trust Agreement being intended to be for the sole and exclusive benefit of the Authority, the Community Facilities District, the Trustee and the Owners.

SECTION 13.03. Notice. All written notices to be given hereunder to the Authority or the Community Facilities District or the Trustee shall be given by mail or electronic means to the party entitled thereto at its address set forth below, or at such other address as such party may provide to the other parties in writing from time to time, namely:
lf to the Authority: Folsom Ranch Financing Authority
50 Natoma Street
Folsom, CA 95630
Attention: Treasurer
Fax: 916-985-0870
Email: [email protected]
If to the Community Facilities District:

City of Folsom
50 Natoma Street
Folsom, CA 95630
Attention: Finance Director
Fax: 916-985-0870
Email: [email protected]. us
41 4149-1157-6629.3

04/12/2022 Item No.13.

If to the
Trustee:

U.S. Bank Trust Company, National Association
One California Street, Suite 1000
San Francisco, CA 94111
Attention: Global Corporate Trust
Fax: 415-677-3769
Email: [email protected]
Each such notice, statement, demand, consent, approval, authorization, offer, designation, request or other communication hereunder shall be deemed delivered to the party to whom it is addressed ( a) if personally served or delivered, upon delivery, (b) if given by electronic communication, upon the sender's receipt of an appropriate answer back or other written acknowledgment or confirmation of receipt of the entire notice, approval, demand, report or other communication, (c) if given by first class mail deposited with the United States mail postage prepaid, seventy-two (72) hours after such notice is deposited with the United States mail, ( d) if given by overnight courier, with courier charges prepaid, twenty-four (24) hours after delivery to said overnight courier, or (e) if given by any other means, upon delivery at the address specified in this Section.

In case, by reason of the suspension of or irregularities in regular mail service, it shall be impractical to mail to the Owners notice of any event when such notice is required to be given pursuant to any provision hereof, then any manner of giving such notice as the Authority shall direct and not objected to by the Trustee shall be deemed to be a sufficient giving of such notice.

The Trustee shall have the right to accept and act upon instructions, including funds transfer instructions ("Instructions") given pursuant to this Trust Agreement and delivered using Electronic Means ("Electronic Means" shall mean the following communications methods: e­ mail, facsimile transmission, secure electronic transmission containing applicable authorization codes, passwords and/or authentication keys issued by the Trustee, or another method or system specified by the Trustee as available for use in connection with its services hereunder); provided, however, that the Authority shall provide to the Trustee an incumbency certificate listing officers with the Authority to provide such Instructions and containing specimen signatures of such officers, which incumbency certificate shall be amended by the Authority whenever a person is to be added or deleted from the listing. If the Authority elects to give the Trustee Instructions using Electronic Means and the Trustee in its reasonable judgment elects to act upon such Instructions, the Trustee's understanding of such Instructions shall be deemed controlling. The Community Facilities District understands and agrees that the Trustee cannot determine the identity of the actual sender of such Instructions and that the Trustee shall be entitled to conclusively presume without liability that directions that purport to have been sent by an officer listed on the incumbency certificate provided to the Trustee have been sent by such officer. The Authority shall be responsible for ensuring that only officers transmit such Instructions to the Trustee and that the Authority and all officers are solely responsible to safeguard the use and confidentiality of applicable user and authorization codes, passwords and/or authentication keys upon receipt by the Authority. The Trustee shall not be liable for any losses, costs claims, or expenses arising directly or indirectly from the Trustee's reliance upon and compliance with such Instructions notwithstanding the fact that such directions conflict or are inconsistent with a subsequent written 42 4149-1157-6629.3

04/12/2022 Item No.13.
instruction. The Authority agrees: (i) to assume all risks arising out of the use of Electronic Means to submit Instructions to the Trustee, including without limitation the risk of the Trustee acting on unauthorized Instructions, and the risk of interception and misuse by third parties; (ii) that it is fully informed of the protections and risks associated with the various methods of transmitting Instructions to the Trustee and that there may be more secure methods of transmitting Instructions than the method(s) selected by the Authority; (iii) that the security procedures (if any) to be followed in connection with its transmission of Instructions provide to it a commercially reasonable degree of protection in light of its particular needs and circumstances; and (iv) to notify the Trustee in writing immediately upon learning of any compromise or unauthorized use of the security procedures.

SECTION 13.04. Holidays. If the date for making any payment or the last date for performance of any act or the exercising of any right, as provided herein, shall not be a Business Day, such payment may be made or act performed or right exercised on the next succeeding Business Day with the same force and effect as if done on the nominal date provided in this Trust Agreement, and no interest shall accrue for the period from and after such nominal date.

SECTION 13.05. Limitation of Liability. The Authority shall not be obligated to make any payments required hereunder or under any Bond, or be deemed to incur any liability hereunder or by reason hereof or arising out of any of the transactions contemplated hereby, payable from any funds or assets other than the Trust Estate as provided herein.

SECTION 13.06. Unclaimed Money. Anything contained herein to the contrary notwithstanding, any money held by the Trustee in trust for the payment and discharge of the interest on or principal of or redemption premiums, if any, on any Bond which remains unclaimed for two (2) years after the date when such amounts have become payable, if such money was held by the Trustee on such date, or for two (2) years after the date of deposit of such money if deposited with the Trustee after the date such amounts have become payable, shall be paid by the Trustee to the Authority as its absolute property free from trust, and the Trustee shall thereupon be released and discharged with respect thereto and the Owners shall look only to the Authority for the payment of such amounts; provided, that before being required to make any such payment to the Authority, the Trustee shall, at the expense and written direction of the Authority, give notice by first class mail to the Owners that such money remains unclaimed and that after a date named in such notice, which date shall not be less than sixty ( 60) days after the date of giving such notice, the balance of such money then unclaimed will be returned to the Authority.

SECTION 13.07. Governing Law. This Trust Agreement shall be governed as to validity, construction and performance by the laws of the State.

SECTION 13.08. Severability of Invalid Provisions. If any clause, provrsion or section hereof is held illegal or invalid by any court, the invalidity of such clause, provision or section shall not affect any of the remaining clauses, provisions or sections hereof, and this Trust Agreement shall be construed and enforced as if such illegal or invalid clause, provision or section had not been contained herein.

SECTION 13.09. Counterparts and Electronic Execution. This Trust Agreement may be executed in any number of counterparts, each of which, when so executed and delivered, shall 43 4149-1157-6629.3

04/12/2022 Item No.13.
be an original; but all of which such counterparts shall together constitute but one and the same instrument. The exchange of copies of this Trust Agreement and of signature pages by facsimile or PDF transmission shall constitute effective execution and delivery of this Trust Agreement as to the parties hereto and may be used in lieu of the original Trust Agreement and signature pages for all purposes. Each party agrees that the electronic signatures, whether digital or encrypted, of the parties included in this Trust Agreement are intended to authenticate this writing and to have the same force and effect as manual signatures. Electronic signature means any electronic sound, symbol, or process attached to or logically associated with a record and executed and adopted by a party with the intent to sign such record, including facsimile or email electronic signatures.

SECTION 13.10. U.S.A. Patriot Act. The parties hereto acknowledge that in accordance with Section 326 of the U.S.A. Patriot Act, the Trustee, like all financial institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account with the Trustee. The parties to this Trust Agreement agree that they will provide the Trustee with such information as it may request in order for the Trustee to satisfy the requirements of the U.S.A. Patriot Act.

SECTION 13 .11. Force Majeure. In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, pandemics, epidemics, quarantine restrictions, recognized public emergencies, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
44 4149-1157-6629.3

04/12/2022 Item No.13.

IN WITNESS WHEREOF, the Authority has caused this Trust Agreement to be executed by the Treasurer, the Community Facilities District has caused this Trust Agreement to be executed in its name by the Finance Director of the City of Folsom, and the Trustee has caused this Trust Agreement to be executed by its authorized signatory, all as of the day and year first above written.

FOLSOM RANCH FINANCING AUTHORITY
By _
Treasurer

CITY OF FOLSOM COMMUNITY FACILITIES
DISTRICT NO. 23 (FOLSOM RANCH)
By _
Finance Director of the City of Folsom
U.S. BANK TRUST COMPANY, NATIONAL

ASSOCIATION,
as Trustee
By _
Authorized Signatory
Signature Page to Trust Agreement
4149-1157-6629.3

04/12/2022 Item No.13.

EXHIBIT A

FORM OF AUTHORITY BONDS

UNITED STATES OF AMERICA

ST A TE OF CALIFORNIA
Unless this Authority Bond (as hereinafter defined) is presented by an authorized representative of The Depository Trust Company, a New York corporation ("DTC"), to the Trustee for registration of transfer, exchange, or payment, and any Authority Bond issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein.

FOLSOM RANCH FINANCING AUTHORITY

CITY OF FOLSOM COMMUNITY FACILITIES DISTRICT
NO. 23 (FOLSOM RANCH) IMPROVEMENT AREA NO. 1 SPECIAL TAX REVENUE BOND, SERIES 2022
No. R- $ _

INTEREST
RATE
%

MATURITY
DATE
September 1, 20_
DATED
DATE
~[ - - ~ ], 2022
CUSIP
344414L J
Registered Owner: CEDE & CO.

Principal Sum: DOLLARS
The Folsom Ranch Financing Authority, a jomt exercise of powers agency established pursuant to the laws of the State of California (the "Authority"), for value received hereby promises to pay to the registered owner specified above, or registered assigns, on the maturity date set forth above (subject to any right of prior redemption hereinafter mentioned) the principal sum set forth above and to pay interest thereon at the interest rate per annum set forth above. The interest on this Authority Bond will be calculated on the basis of a 360-day year consisting of twelve (12) 30-day calendar months and will be payable on March 1 and September 1 in each year ( each an "Interest Payment Date"), commencing on [September 1, 2022], and is A-1
4149-1157-6629.3

04/12/2022 Item No.13.
payable by check, mailed by first class mail, on each Interest Payment Date to the registered owner whose name appears on the bond register maintained by the Corporate Trust Office ( as defined in the Trust Agreement hereinafter referred to) of U.S. Bank Trust Company, National Association (together with any successor as Trustee under the Trust Agreement hereinafter mentioned, the "Trustee") as of the close of business on the fifteenth (15th) day of the month preceding such Interest Payment Date (the "Record Date"), except with respect to defaulted interest for which a special record date will be established; provided, that in the case of a registered owner of one million dollars ($1,000,000) or more in aggregate principal amount of Authority Bonds, upon written request of such registered owner to the Trustee received not later than the Record Date, such interest shall be paid on the Interest Payment Date in immediately available funds by wire transfer to an account in a bank or trust company or savings bank that is a member of the Federal Reserve System and that is located in the continental United States of America. The principal hereof and the redemption premium hereon, if any, are payable upon presentation and surrender hereof at the Corporate Trust Office of the Trustee. Both the interest on and principal of and redemption premium, if any, hereon are payable in lawful money of the United States of America.

All capitalized terms used herein but not otherwise defined shall have the meanings contained in the hereinafter mentioned Trust Agreement.

The Authority and the Trustee shall be entitled to conclusively treat the registered owner of this Authority Bond as the absolute owner hereof for the purpose of receiving payment as herein provided and for all other purposes, and the Authority and the Trustee shall not be affected by notice to the contrary.

This Authority Bond is one of a duly authorized issue of bonds of the Authority designated as the "Folsom Ranch Financing Authority City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 1 Special Tax Revenue Bonds, Series 2022" (the "Authority Bonds") issued in the aggregate principal amount of [ ] dollars ($[ ]) pursuant to the provisions relating to the joint exercise of powers found in Chapter 5 of Division 7 of Title 1 of the California Government Code, including the Marks-Roos Local Bond Pooling Act of 1985 (being California Government Code Sections 6584-6594) as amended and supplemented (the "Act"), and pursuant to a trust agreement executed and entered into as of May 1, 2022, by and among the Authority, the City of Folsom Community Facilities District No. 23 (Folsom Ranch) (the "Community Facilities District") and the Trustee (the "Trust Agreement").

The Authority Bonds are issued for the purpose of purchasing Local Obligations, and reference is hereby made to the Trust Agreement (a copy of which is on file at the Corporate Trust Office of the Trustee) and all trust agreements supplemental thereto and to the Act for a description of the purposes thereof, of the rights thereunder of the registered owner, of the nature and extent of the security for the Authority Bonds and of the rights, duties and immunities of the Trustee, of the obligations of the Community Facilities District, and of the rights and obligations of the Authority thereunder, to all the provisions of which Trust Agreement the registered owner of this Authority Bond, by acceptance hereof, assents and agrees.

The Authority Bonds and the interest thereon and any redemption premiums thereon are special, limited obligations of the Authority payable solely from the Trust Estate and are secured by the Trust Estate, including amounts held in the accounts and funds ( other than the Rebate Fund) established pursuant to the Trust Agreement (including proceeds of the sale of the Authority Bonds), subject only to the provisions of the Trust Agreement permitting the application A-2
4149-1157-6629.3

04/12/2022 Item No.13.
thereof for the purposes and on the terms and conditions set forth in the Trust Agreement. No member or officer of the Authority, nor any person executing this Authority Bond, shall in any event be subject to any personal liability or accountability by reason of the issuance of this Authority Bond.

THE AUTHORITY BONDS ARE SPECIAL, LIMITED OBLIGATIONS OF

THE AUTHORITY, PAYABLE FROM, AND SECURED AS TO THE PAYMENT OF THE

PRINCIPAL OF AND ANY REDEMPTION PREMIUMS ON OR INTEREST ON THE

AUTHORITY BONDS IN ACCORDANCE WITH THEIR TERMS AND THE TERMS OF THE TRUST AGREEMENT, SOLELY FROM THE TRUST ESTATE. THE AUTHORITY BONDS

DO NOT CONSTITUTE A CHARGE AGAINST THE GENERAL CREDIT OF THE

AUTHORITY OR ITS MEMBERS, AND UNDER NO CIRCUMSTANCES SHALL THE

AUTHORITY BE OBLIGATED TO PAY PRINCIPAL OF OR ANY REDEMPTION

PREMIUMS ON OR INTEREST ON THE AUTHORITY BONDS EXCEPT FROM THE TRUST ESTATE. NONE OF THE COMMUNITY FACILITIES DISTRICT, THE CITY OF FOLSOM (THE "CITY"), THE STATE OF CALIFORNIA NOR ANY PUBLIC AGENCY (OTHER THAN THE AUTHORITY) NOR ANY MEMBER OF THE COMMUNITY

FACILITIES DISTRICT OR THE AUTHORITY IS OBLIGATED TO PAY THE PRINCIPAL

OF OR ANY REDEMPTION PREMIUMS ON OR INTEREST ON THE AUTHORITY BONDS,

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

COMMUNITY FACILITIES DISTRICT, THE CITY, THE STATE OF CALIFORNIA OR ANY

PUBLIC AGENCY THEREOF OR ANY MEMBER OF THE AUTHORITY (INCLUDING THE

CITY) OR THE COMMUNITY FACILITIES DISTRICT IS PLEDGED TO THE PAYMENT

OF THE PRINCIPAL OF OR ANY REDEMPTION PREMIUMS ON OR INTEREST ON THE

AUTHORITY BONDS, AND NEITHER THE PRINCIPAL OF OR ANY REDEMPTION

PREMIUMS ON OR INTEREST ON THE AUTHORITY BONDS CONSTITUTES A DEBT,

LIABILITY OR OBLIGATION OF THE COMMUNITY FACILITIES DISTRICT, THE CITY,

THE STATE OF CALIFORNIA OR ANY PUBLIC AGENCY (OTHER THAN THE AUTHORITY) OR ANY MEMBER OF THE AUTHORITY.

The Authority Bonds are subject to optional redemption by the Authority prior to their respective maturity dates as a whole or in part on any date on or after September 1, 20L ], from any source of available funds other than Minimum Sinking Fund Payments and Special Tax Prepayments, upon mailed notice as hereinafter provided, at the following redemption prices ( computed upon the principal amount of the Authority Bonds or portions thereof called for redemption) together with accrued interest thereon to the date fixed for redemption:
103% if redeemed on any date on or after September 1, 20LJ through August 31, 20LJ ;
102% if redeemed on any date from September 1, 20L ] through August 31, 20L ];
101 % if redeemed on any date from September 1, 20L ] through August 31, 20L ]; and
100% if redeemed on September 1, 20L ] and any date thereafter.

A-3
4149-1157-6629.3

04/12/2022 Item No.13.

The Authority Bonds are subject to extraordinary redemption by the Authority prior to their respective maturity dates, as a whole or in part on any Interest Payment Date on or after September 1, 20L ], solely from funds derived from extraordinary redemption of Local Obligations from Special Tax Prepayments, at the following redemption prices ( computed upon the principal amount of the Authority Bonds or portions thereof called for redemption) together with accrued interest thereon to the date fixed for redemption:
103% if redeemed on an Interest Payment Date on or after September 1, 20LJ through March 1, 20L ];
102% if redeemed on an Interest Payment Date on September 1, 20LJ and March 1, 20LJ ;
101 % if redeemed on an Interest Payment Date on September 1, 20L ] and March 1, 20LJ ; and
100% if redeemed on September 1, 20 L ] and any Interest Payment Date thereafter.

The Authority Bonds maturing on September 1, 20L ], are subject to mandatory redemption by the Authority prior to their stated maturity date in part on September 1 of each year on and after September 1, 20L ], to and including September 1, 20L ]; and the Authority Bonds maturing on September 1, 20LJ , are subject to mandatory redemption by the Authority prior to their stated maturity date in part on September 1 of each year on and after September 1, 20LJ , to and including September 1, 20L ], upon mailed notice as hereinafter provided, from (and in the amount of) the Minimum Sinking Fund Payment due and payable for the Authority Bonds on each such date, at a redemption price equal to the principal amount thereof plus accrued interest thereon to the date of redemption, without premium.

Notice of redemption of any Authority Bonds shall be mailed by first class mail, in a sealed envelope, postage prepaid, at least thirty (30) but not more than sixty (60) days before the date fixed for redemption, to the registered owners of such Authority Bonds ( or portions thereof) so called for redemption, at their respective addresses as the same shall last appear on the Bond Register maintained by the Trustee; provided, that neither the failure of a registered owner to receive notice of redemption of Authority Bonds nor any error in such notice shall affect the validity of the proceedings for the redemption of Authority Bonds.

Any notice of optional redemption under the Trust Agreement may be rescinded by written notice given by the Authority to the Trustee no later than three (3) Business Days prior to the date specified for redemption. The Trustee shall give notice of rescission of the notice of optional redemption or non-satisfaction of any conditions specified in the notice of optional redemption as soon as practicable to the same parties and in the same manner as the notice of redemption was given.

The Authority Bonds are issuable as fully registered bonds in denominations of five thousand dollars ($5,000) or any integral multiple in excess thereof. This Authority Bond may be transferred or exchanged by the registered owner hereof, in person or by an attorney duly authorized in writing, but only in the manner, subject to the limitations and upon payment of the A-4
4149-1157-6629.3

04/12/2022 Item No.13.
charges, if any, provided in the Trust Agreement, and upon surrender and cancellation of this Authority Bond. Upon such transfer or exchange, a new Authority Bond or Authority Bonds, of authorized denominations, for the same aggregate principal amount, interest rate and maturity will be issued to the transferee in accordance with the provisions of the Trust Agreement. The Trustee is not required to register the transfer of, or to exchange, any Authority Bond during the period established by the Trustee for selection of Authority Bonds for redemption or to register the transfer of, or to exchange, any Authority Bond which has been selected for redemption pursuant to the Trust Agreement.

The Trust Agreement and the rights and obligations of the Authority and of the registered owners of the Authority Bonds may be modified or amended from time to time and at any time ( and in certain cases without the consent of such registered owners) in the manner, to the extent and upon the terms provided in the Trust Agreement.

The Trust Agreement contains provisions perrnrtting the Authority to make provisions for the payment of the interest on, and the principal and premium, if any, of, any of the Authority Bonds so that such Authority Bonds shall no longer be deemed to be Outstanding under the terms of the Trust Agreement.

It is hereby certified and recited that any and all conditions, things and acts required to exist, to have happened and to have been performed precedent to and in the issuance of this Authority Bond do exist, have happened and have been performed in due time, form and manner as required by the Constitution and laws of the State of California, including the Act, and that the amount of this Authority Bond, together with all other indebtedness of the Authority, does not exceed any limit prescribed by the Constitution and laws of the State of California, including the Act, and is not in excess of the amount of Authority Bonds permitted to be issued under the Trust Agreement.

This Authority Bond shall not be entitled to any benefit under the Trust Agreement, or become valid or obligatory for any purpose, until the certificate of authentication hereon endorsed shall have been manually signed by an authorized signatory of the Trustee.

A-5
4149-1157-6629.3

04/12/2022 Item No.13.

IN WITNESS WHEREOF, the Folsom Ranch Financing Authority has caused this Authority Bond to be executed in its name and on its behalf by the manual or facsimile signature of its Treasurer and attested by the facsimile signature of its Secretary, all as of May LJ , 2022.

FOLSOM RANCH FINANCING AUTHORITY
By: _
Treasurer
Attest:

Secretary
A-6
4149-1157-6629.3

04/12/2022 Item No.13.

FORM OF CERTIFICATE OF AUTHENTICATION
This is one of the Authority Bonds described in the within-mentioned Trust Agreement, which has been authenticated on the date below.

Dated: May L ], 2022
U.S. Bank Trust Company, National Association
as Trustee
By:- - - - - - - - - - - - - - ­
Authorized Signatory
A-7
4149-1157-6629.3

04/12/2022 Item No.13.

FORM OF ASSIGNMENT
For value received, the undersigned sells, assigns and transfers unto _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ this registered Authority Bond and irrevocably constitutes and appoints attorney to transfer the same on the books of the Trustee, with full power of substitution in the premises.

Dated: - - - - - - - - - - - -
SIGNATURE GUARANTEED BY:

NOTE: Signatures must be guaranteed by an "eligible guarantor institution" meeting the requirements of membership or participation in the Security Transfer Agent Medallion Program ("ST AMP") or such other "signature guarantee program" as may be determined in substitution for STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.

Social Security Number, Taxpayer Identification Number or other Identifying Number of Assignee: _
A-8
4149-1157-6629.3

04/12/2022 Item No.13.

TABLE OF CONTENTS
Page

ARTICLE I

DEFINITIONS
Section 1.01. Definitions 2
Section 1.02. Rules of Construction l 0

ARTICLE II

TERMS OF AUTHORITY BONDS
Section 2.01.

Section 2.02.

Section 2.03.

Section 2.04.

Section 2.05.

Section 2.06.

Section 2.07.

Section 2.08.

Section 2.09.

Section 2.10.

Section 2.11.

Section 3.01.

Section 3.02.

Section 4.01.

Section 4.02.

Section 4.03.

Section 4.04.

Section 4.05.

Section 4.06.

Section 4.07.

Section 4.08.

The Authority Bonds 10
Form of Authority Bonds 13
Authority Bonds Mutilated, Destroyed, Stolen or Lost 13 Execution of Authority Bonds 13
Transfer and Registration of Authority Bonds 14
Regulations with Respect to Exchange or Transfer of Authority Bonds .14 Authentication of Authority Bonds 15
Cancellation of Authority Bonds 15
Authority Bonds as Special Obligations 15
Special Covenants as to Book-Entry Only System for Authority Bonds 15 CU SIP Numbers 17

ARTICLE III

ISSUANCE OF AUTHORITY BONDS
Provisions for the Issuance of Authority Bonds 17
Parity and Subordinate Bonds 18

ARTICLE IV

REDEMPTION OF AUTHORITY BONDS
General Redemption Provisions 18
Optional Redemption 18
Extraordinary Redemption 19
Mandatory Redemption 19
Redemption Instructions 19
Notice of Redemption 20
Payment of Redeemed Authority Bonds 21
Purchase in Lieu of Redemption 21

ARTICLE V

REVENUES AND FUNDS FOR AUTHORITY BONDS
Section 5.01. Establishment of Funds .21
Section 5.02. Deposit of Proceeds of Authority Bonds 21 Section 5.03. Proceeds Fund 22
Section 5.04. Local Obligations Fund 22
Section 5.05. Revenue Fund .............................................................•....................................... 22 Section 5.06. Revenues Derived from Special Tax Prepayments .22 -1-
4149-1157-6629.3

04/12/2022 Item No.13.

TABLE OF CONTENTS
( continued)
Page
Section 5.07.

Section 5.08.

Section 5.09.

Section 5.10.

Interest Fund 22
Principal Fund 22
Redemption Fund 23
Rebate Fund 23

ARTICLE VI

SECURITY FOR AND INVESTMENT OF MONEY
Section 6.01. Security 24
Section 6.02. Investment of Money .24

ARTICLE VII

COVENANTS OF THE AUTHORITY AND THE IMPROVEMENT AREA
Section 7.01.

Section 7.02.

Section 7.03.

Section 7.04.

Section 7.05.

Section 7.06.

Section 7.07.

Section 7.08.

Section 8.01.

Section 8.02.

Section 8.03.

Section 8.04.

Section 8.05.

Section 8.06.

Section 8.07.

Section 8.08.

Section 8.09.

Section 9.01.

Section 9.02.

Section 9.03.

Section 9.04.

Section 9.05.

Section 9.06.

Section 9.07.

Payment of Authority Bonds; No Encumbrances 25
Enforcement and Amendment of Local Obligations 25
Further Documents 26
Tax Covenants for the Authority Bonds 26
Maintenance of Existence 27
Continuing Disclosure 27
Redemption Fund for the Local Obligations 27
Concerning the Trust Estate .28

ARTICLE VIII

DEF AUL TS AND REMEDIES
Events ofDefault 28
Proceedings by Trustee; No Acceleration 29
Effect of Discontinuance or Abandonment 29
Rights of Owners 29
Restriction on Owner's Action 30
Power of Trustee to Enforce 30
Remedies Not Exclusive 30
Waiver of Events of Default; Effect ofWaiver 31
Application of Money upon Event of Default.. 31

ARTICLE IX

THE TRUSTEE
Appointment and Acceptance of Duties 32
Duties, Immunities and Liability of Trustee 32
Merger or Consolidation 35
Compensation and Indemnification 35
Liability of Trustee 36
Right to Rely on Documents; Adverse Effect Determinations 36 Preservation and Inspection of Documents 3 7
-11-
4149-1157-6629.3

04/12/2022 Item No.13.

TABLE OF CONTENTS
( continued)
Page
Section 9.08. Indemnity for Trustee 37

ARTICLEX

EXECUTION OF INSTRUMENTS BY OWNERS AND

PROOF OF OWNERSHIP OF AUTHORITY BONDS
Section 10.01. Execution ofl nstruments; Proof of Ownership 37

ARTICLE XI

SUPPLEMENTAL TRUST AGREEMENTS
Section 11.01. Supplemental Trust Agreements with Consent of Owners 38 Section 11.02. Supplemental Trust Agreements Without Consent of Owners 38 Section 11.03. Trustee Authorized to Enter into Supplemental Trust Agreements 39

ARTICLE XII

DEFEASANCE
Section 12.01. Defeasance 39
Section 12.02. Authority Bonds Deemed to Have Been Paid .40 Section 12.03. Money Held for Particular Authority Bonds .41 Section 12.04. Effect of Defeasance of Authority Bonds .41

ARTICLE XIII

MISCELLANEOUS
Section 13.01. Dissolution of Authority .41
Section 13.02. Parties Interested Herein .41
Section 13.03. Notice 41
Section 13.04. Holidays 43
Section 13.05. Limitation of Liability .43
Section 13.06. Unclaimed Money .43
Section 13.07. Governing Law 43
Section 13.08. Severability of Invalid Provisions .43
Section 13.09. Counterparts 43
Section 13.10. U.S.A. Patriot Act 44
Section 13.11. Force Majeure .44
EXHIBIT A FORM OF AUTHORITY BONDS A-1
-111-
4149-1157-6629.3

04/12/2022 Item No.13.

ATTACHMENT 4

04/12/2022 Item No.13.

OH&SDRAFT
3/10/22

FIRST SUPPLEMENTAL INDENTURE
between the
CITY OF FOLSOM COMMUNITY FACILITIES DISTRICT NO. 23
(FOLSOM RANCH)
and
U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION,
as Trustee
Relating to the
$[~ - - ~ ]

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 23 (FOLSOM RANCH)
IMPROVEMENT AREA NO. 1
SPECIAL TAX BONDS, SERIES 2022
Dated as of May 1, 2022
4125-3772-8821.3

04/12/2022 Item No.13.

TABLE OF CONTENTS
Page

ARTICLE I

DEFINITIONS
SECTION 1.01. Definitions 2

ARTICLE II
ISSUANCE OF SERIES 2022 BONDS
SECTION 2.01. Authorization of Series 2022 Bonds 3
SECTION 2.02. Registration of Series 2022 Bonds 3
SECTION 2.03. Terms of Series 2022 Bonds .4
SECTION 2.04. Redemption Prices of Series 2022 Bonds 6
SECTION 2.05. Form of Series 2022 Bonds 7
SECTION 2.06. Application of Proceeds of Sale of Series 2022 Bonds 7 SECTION 2.07. Capitalized Interest Account 8

ARTICLE III

MISCELLANEOUS
SECTION 3.01. Authority for First Supplemental Indenture 8 SECTION 3.02. Covenant of the Community Facilities District Against Federal Income Taxation 8
SECTION 3.03. Covenant of the Community Facilities District Relating to Maximum Facilities Special Tax Coverage 9
SECTION 3.04. Statements of Fund and Accounts 9
SECTION 3.05. Amendment to Section 10.14 of the Master Indenture 9 SECTION 3.06. Terms of Series 2022 Bonds Subject to the Master Indenture 10 SECTION 3.07. Effective Date of First Supplemental Indenture 10

EXHIBIT A
FORM OF SERIES 2022 BONDS
-1-
4125-3772-8821.3

04/12/2022 Item No.13.

FIRST SUPPLEMENTAL INDENTURE
This First Supplemental Indenture (the "First Supplemental Indenture"), dated as of May 1, 2022, is between the CITY OF FOLSOM COMMUNITY FACILITIES DISTRICT NO. 23 (FOLSOM RANCH), organized and existing under and by virtue of the laws of the State of California (the "Community Facilities District"), and U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION, a national banking association duly organized and existing under and by virtue of the laws of the United States of America and authorized to accept and execute trusts of the character herein set forth, as trustee ( the "Trustee").

BACKGROUND
A. The Community Facilities District and MUFG Union Bank, N.A., as trustee (the "Original Trustee"), duly executed an Indenture (the "Master Indenture") dated as of October 1, 2020, which authorized the issuance of City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 1 Special Tax Bonds (the "Bonds") and provided for the issuance of the Bonds in series.

B. U.S. Bank National Association (the "Prior Trustee") succeeded and replaced the Original Trustee under the Master Indenture in accordance with its terms.

C. The Trustee has succeeded and replaced the Prior Trustee under the Master Indenture in accordance with its terms.

D. The Community Facilities District has determined to prescribe the terms, conditions, and form of$[ ] aggregate principal amount of City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 1 Special Tax Bonds, Series 2022 (the "Series 2022 Bonds") under the Master Indenture.

E. The Community Facilities District has determined that all things necessary to cause the Series 2022 Bonds, when duly executed by the Community Facilities District and authenticated by the Trustee and delivered as provided herein, to be legal and valid special tax obligations of the Community Facilities District enforceable in accordance with their terms, and to constitute this First Supplemental Indenture a valid agreement for the uses and purposes herein set forth in accordance with its terms, have been done and taken, and the execution and delivery hereof and the execution and delivery of the Series 2022 Bonds, subject to the terms hereof, have in all respects been duly authorized.

F. The Folsom Ranch Financing Authority (the "Authority") has agreed to purchase the Series 2022 Bonds pursuant to a Local Obligation Purchase Contract between the Authority and the Community Facilities District dated [ ], 2022 (the "2022 Local Obligation Purchase Contract"), with a portion of the proceeds of the Authority's City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 1 Special Tax Revenue Bonds, Series 2022 (the "2022 Authority Bonds").

NOW, THEREFORE, in order to secure the payment of the interest on and the principal of and the redemption premiums, if any, on all Series 2022 Bonds at any time issued and outstanding 4125-3772-8821.3

04/12/2022 Item No.13.
hereunder according to their tenor, and to secure the observance and performance of all the agreements, conditions, covenants, and terms therein and herein set forth, and to declare the conditions and terms upon and subject to which the Series 2022 Bonds will be issued and received, and in consideration of the premises and of the mutual agreements and covenants contained herein and of the purchase and acceptance of the Series 2022 Bonds by the registered owners thereof from time to time, and for other valuable considerations, the receipt whereof is hereby acknowledged, the Community Facilities District does hereby agree and covenant with the Trustee, for the benefit of the respective registered owners from time to time of the Series 2022 Bonds, as follows:

ARTICLE I

DEFINITIONS
SECTION 1.01. Definitions.
(a) Except as otherwise provided herein, all terms defined in Section 1.01 of the Master Indenture have the same definitions in this First Supplemental Indenture that are given to them in Section 1.01 of the Master Indenture.
(b) Unless the context otherwise requires, the terms defined in this Section 1.01 (b) have the meanings set forth, and those meanings apply for all purposes of this First Supplemental Indenture, of the Master Indenture, of the Series 2022 Bonds, and of any certificate, opinion, report, request, or other document mentioned herein or therein; and those meanings apply equally to both the singular and plural forms of the terms:
"2022 Authority Bonds" means the Folsom Ranch Financing Authority City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 1 Special Tax Revenue Bonds, Series 2022.
"2022 Authority Trustee" means U.S. Bank Trust Company, National Association, as trustee under the 2022 Trust Agreement.
"2022 Local Obligation Purchase Contract" means the Local Obligation Purchase Contract between the Community Facilities District and the Authority providing for the sale of the Series 2022 Bonds.
"2022 Trust Agreement" means that certain Trust Agreement, dated as of May 1, 2022, among the Authority, the Community Facilities District and the 2022 Authority Trustee, as trustee for the 2022 Authority Bonds.
"Capitalized Interest Account" means the City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 1 Special Tax Bonds Capitalized Interest Account established pursuant to Section 2.14 of the Master Indenture and reestablished pursuant to Section 2.07 of this First Supplemental Indenture. "Costs of Issuance Fund" means the City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 1 Special Tax Bonds Costs ofl ssuance Fund 2 4125-3772-8821.3

04/12/2022 Item No.13.
established pursuant to Section 2.16 of the Master Indenture and reestablished pursuant to Section 2.08 of this First Supplemental Indenture.
"First Supplemental Indenture" means this First Supplemental Indenture dated as of May 1, 2022, between the Community Facilities District and the Trustee entered into under the Law and the Master Indenture.
"Master Indenture" means the Indenture dated as of October 1, 2020, between the Community Facilities District and the Trustee entered into under the Law. "Series 2022 Acquisition and Construction Account" means the account by that name established in the Acquisition and Construction Fund pursuant to Section 2.06 of this First Supplemental Indenture.
"Series 2022 Bond Reserve Account" means the account by that name established in the Bond Reserve Fund pursuant to Section 2.06 of this First Supplemental Indenture. "Series 2022 Bonds" means the Bonds referred to by that name authorized to be issued by the Master Indenture and Article II of this First Supplemental Indenture. "Series 2022 Costs of Issuance Account" means the account by that name established in the Costs of Issuance Fund pursuant to Section 2.06 of this First Supplemental Indenture. "Term Series 2022 Bonds" means the Series 2022 Bonds that are Term Bonds.

ARTICLE II
ISSUANCE OF SERIES 2022 BONDS
SECTION 2.01. Authorization of Series 2022 Bonds. The City Council, as legislative body of the Community Facilities District, has reviewed all proceedings heretofore taken relative to the authorization of the Series 2022 Bonds and has found, as a result of such review, and hereby finds and determines, that all acts, conditions, and things required by law to exist, happen, and be performed precedent to and in the issuance of the Series 2022 Bonds do exist, have happened, and have been performed in due time, form, and manner as required by the Law.

Accordingly, the Community Facilities District is now authorized, under every requirement of the Law, the Master Indenture, and this First Supplemental Indenture, to issue the Series 2022 Bonds in the form and manner provided herein, which Series 2022 Bonds will be entitled to the benefit, protection, and security of the Law, the Master Indenture, and this First Supplemental Indenture.

The purpose for which the Series 2022 Bonds are to be issued is to provide funds to finance the acquisition and construction of certain of the Facilities, make a deposit to the Series 2022 Bond Reserve Account, make a deposit to the Capitalized Interest Account to fund interest on the Series 2022 Bonds through [September 1, 2022], and to pay the Costs of Issuance of the Series 2022 Bonds.

SECTION 2.02. Registration of Series 2022 Bonds. Notwithstanding Section 2.11 of the Master Indenture, the Series 2022 Bonds shall be registered in the name of the 2022 Authority Trustee, as trustee for the Authority, and delivered to the 2022 Authority Trustee upon 3 4125-3772-8821.3

04/12/2022 Item No.13.
the issuance thereof in accordance with the provisions of the 2022 Local Obligation Purchase Contract.

SECTION 2.03. Terms of Series 2022 Bonds.
(a) The Series 2022 Bonds will be issued in the aggregate principal amount of $[ ]; will be designated the "City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 1 Special Tax Bonds, Series 2022;" will be dated the date of the original delivery thereof; will be issued in fully registered form without coupons in denominations of $5,000 or any integral multiple thereof; and will mature on the dates and in the principal amounts and bear interest (computed on a 360-day year of twelve 30-day calendar months) at the rates per annum, payable semiannually on March 1 and September 1 in each year, commencing on [September 1, 2022], as follows:

Maturity Date
(September 1)
2022
Principal Amount Interest Rate
$ %
* Term Bonds
(b) Minimum Sinking Fund Account Payments are hereby established for the mandatory redemption and payment of the Series 2022 Bonds maturing on September 1, 20LJ , which payments shall become due during the years ending on the dates and in the amounts set forth in the following schedule ( except that if any of the Series 2022 Bonds maturing on September 1, 20L ] shall have been 4 4125-3772-8821.3

04/12/2022 Item No.13.
optionally or extraordinarily redeemed under Section 2.04 of this First Supplemental Indenture, the amounts of the Minimum Sinking Fund Account Payments for the Series 2022 Bonds maturing on September 1, 20L ] shall be reduced proportionately by the principal amount of all such Series 2022 Bonds so optionally or extraordinarily redeemed), namely:

Year Ending
September 1
Minimum Sinking Fund
Account Payment
$
*
* Maturity
Minimum Sinking Fund Account Payments are hereby established for the mandatory redemption and payment of the Series 2022 Bonds maturing on September 1, 20L ], which payments shall become due during the years ending on the dates and in the amounts set forth in the following schedule ( except that if any of the Series 2022 Bonds maturing on September 1, 20L ] shall have been optionally or extraordinarily redeemed under Section 2.04 of this First Supplemental Indenture, the amounts of the Minimum Sinking Fund Account Payments for the Series 2022 Bonds maturing on September 1, 20LJ shall be reduced proportionately by the principal amount of all such Series 2022 Bonds so optionally or extraordinarily redeemed), namely:

Year Ending
September 1
Minimum Sinking Fund
Account Payment
$
*
* Maturity
All such Minimum Sinking Fund Account Payments shall be deposited in the Sinking Fund Subaccount. All money in the Sinking Fund Subaccount representing such Minimum Sinking Fund Account Payments shall be used and withdrawn by the Trustee (upon receipt of a Written Request of the Community Facilities District) at any time for the purchase of the Term Series 2022 Bonds at public or private sales as and when and at such prices (including brokerage and other charges) as the Community Facilities District may in its discretion determine, but not to exceed the principal amount of such Term Series 2022 Bonds. All money in the Sinking Fund Subaccount representing such Minimum Sinking Fund Account Payments on September 1 of each year during the period beginning on September 1, 20LJ , and 5 4125-3772-8821.3

04/12/2022 Item No.13.
ending on September 1, 20LJ , both dates inclusive, shall be used and withdrawn by the Trustee on each such September 1 for the mandatory redemption or payment of the Term Series 2022 Bonds maturing on September 1, 20L ]; and all money in the Sinking Fund Subaccount representing such Minimum Sinking Fund Account Payments on September 1 of each year during the period beginning on September 1, 20LJ , and ending on September 1, 20LJ , both dates inclusive, shall be used and withdrawn by the Trustee on each such September 1 for the mandatory redemption or payment of the Term Series 2022 Bonds maturing on September 1, 20LJ ; and the Community Facilities District hereby agrees and covenants with the Holders of the Term Series 2022 Bonds to call and redeem in accordance with Article III of the Master Indenture or pay the Term Series 2022 Bonds from the Minimum Sinking Fund Account Payments deposited in the Sinking Fund Subaccount under this paragraph whenever on September 1 of any year, beginning on September 1, 2022, there is money in the Sinking Fund Subaccount available for such purpose.

SECTION 2.04. Redemption Prices of Series 2022 Bonds.
(a) The Series 2022 Bonds are subject to optional redemption by the Community Facilities District prior to their respective maturity dates as a whole or in part on any date on or after September 1, 20L ], from any source other than such Minimum Sinking Fund Account Payments deposited in the Sinking Fund Subaccount or such prepayments of the Special Tax, upon mailed notice as provided in the Master Indenture, at the following redemption prices ( computed upon the principal amount of the Series 2022 Bonds or portions thereof called for redemption) together with accrued interest thereon to the date fixed for redemption, to wit:
103% if redeemed on any date on or after September 1,
20L ] through August 31, 20LJ ;
102% if redeemed on any date from September 1, 20L ]
through August 31, 20LJ ;
101 % if redeemed on any date from September 1, 20LJ
through August 31, 20LJ ; and
100% if redeemed on September 1, 20LJ and any date
thereafter.
(b) The Series 2022 Bonds are subject to extraordinary redemption by the Community Facilities District prior to their respective maturity dates, as a whole or in part on any interest payment date on or after September 1, 20LJ , from funds derived by the Community Facilities District from prepayments of the Special Tax, upon mailed notice as provided in the Master Indenture, at the following redemption prices ( computed upon the principal amount of the Series 2022 Bonds or portions thereof called for redemption) together with accrued interest thereon to the date fixed for redemption, to wit:
6 4125-3772-8821.3

04/12/2022 Item No.13.
103% if redeemed on an interest payment date on or after September 1, 20LJ through March 1, 20L ];
102% if redeemed on an interest payment date on
September 1, 20LJ or March 1, 20L ];
101 % if redeemed on an interest payment date on
September 1, 20LJ or March 1, 20L ]; and
100% if redeemed on September 1, 20L ] or any interest
payment date thereafter.
(c) The Term Series 2022 Bonds are subject to mandatory redemption by the Community Facilities District before their stated maturity date as provided in Section 2.03 hereof solely from Minimum Sinking Fund Account Payments deposited in the Sinking Fund Subaccount, upon mailed notice as provided in the Master Indenture, at a redemption price equal to the principal amount thereof to be redeemed, together with accrued interest to the date of redemption, without premium.

SECTION 2.05.
authentication and registration endorsements and the assignment to appear thereon must be substantially in the forms set forth in Exhibit A hereto, with such variations, insertions, or omissions as are appropriate and not inconsistent herewith.

Form of Series 2022 Bonds. The Series 2022 Bonds and the SECTION 2.06. Application of Proceeds of Sale of Series 2022 Bonds. Upon the receipt of payment of the purchase price of the Series 2022 Bonds when the Series 2022 Bonds shall have been duly sold by the Community Facilities District, the Trustee shall deposit such proceeds of sale of the Series 2022 Bonds into a temporary account called the Proceeds Fund which the Trustee shall establish, maintain and hold in trust, and which shall be disbursed in full on the date ofr eceipt (whereupon said temporary account shall be closed) in the following order:
(a) First, the Trustee shall deposit$[ ] in the Series 2022 Bond Reserve Account, which the Trustee shall establish and maintain as a Bond Reserve Account within the Bond Reserve Fund, which amount equals the Required Bond Reserve for the Series 2022 Bonds as of the date of issuance of the Series 2022 Bonds. (b) Second, the Trustee shall deposit$[ ] in the Series 2022 Costs oflssuance Account, which the Trustee shall establish and maintain within the Costs of Issuance Fund.
(c) Third, the Trustee shall deposit$~[- - - ~ ] in the Capitalized Interest Account. (d) Fourth, the Trustee shall deposit$[ ] in the Series 2022 Acquisition and Construction Account, which the Trustee shall establish and maintain within the Acquisition and Construction Fund.
7 4125-3772-8821.3

04/12/2022 Item No.13.

SECTION 2.07. Capitalized Interest Account. There is hereby reestablished a fund to be known as the City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 1 Special Tax Bonds Capitalized Interest Account. On the following date, the Trustee shall transfer the amount from the Capitalized Interest Account to the Redemption Account for the payment of interest due on the Series 2022 Bonds:

Date of Transfer Amount
$[._ _ __.]
On the date set forth in the table immediately above, the amount set forth shall be transferred from the Capitalized Interest Account to the Redemption Account for the payment of interest due on the Series 2022 Bonds. The Capitalized Interest Account will be closed following the last date of transfer.

SECTION 2.08. Costs of Issuance Fund. There is hereby reestablished a fund to be known as the City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 1 Special Tax Bonds Costs ofl ssuance Fund, to be held and administered by the Trustee.

All money in the Costs of Issuance Fund shall be used and withdrawn by the Trustee to pay the Costs ofl ssuance upon receipt of a Written Request of the Community Facilities District filed with the Trustee, each of which shall be sequentially numbered and shall state the person to whom payment is to be made, the amount to be paid, the purpose for which the obligation was incurred and that such payment is a proper charge against such fund; provided, that on November LJ , 2022, or upon a prior determination by the Community Facilities District that all Costs ofl ssuance relating to the Series 2022 Bonds have been paid ( as set forth in a Certificate of the Community Facilities District so determining filed with the Trustee), any balance of money remaining in the Series 2022 Costs ofl ssuance Account within the Costs ofl ssuance Fund shall be withdrawn from the Series 2022 Costs of Issuance Account by the Trustee and transferred to the Acquisition and Construction Fund. The Series 2022 Costs of Issuance Account will be closed following the last date of transfer.

ARTICLE III

MISCELLANEOUS
SECTION 3.01. Authority for First Supplemental Indenture. This First Supplemental Indenture is executed in accordance with the Law, is supplemental to the Master Indenture, and is executed in accordance with Articles II and VII of the Master Indenture.

SECTION 3.02. Covenant of the Community Facilities District Against Federal Income Taxation. Notwithstanding Section 5.03 of the Master Indenture, the Community Facilities District will not take any action, or fail to take any action, if such action or failure to take such action would adversely affect the exclusion from gross income of the interest on the Series 2022 Bonds pursuant to Section 103 of the Code, and specifically the Community Facilities District will not directly or indirectly use or make any use of the proceeds of the 2022 Authority Bonds or any other funds of the Community Facilities District or take or omit to take any action that would cause the 2022 Authority Bonds to be "arbitrage bonds" subject to federal income taxation by reason of Section 148 of the Code or "private activity bonds" subject to federal income taxation by reason of Section 141(a) of the Code or obligations subject to federal income taxation 8 4125-3772-8821.3

04/12/2022 Item No.13.
because they are "federally guaranteed" as provided in Section 149(b) of the Code; and to that end the Community Facilities District, with respect to the proceeds of the Series 2022 Bonds and such other funds, will comply with all requirements of such sections of the Code and all regulations of the United States Department of the Treasury issued thereunder to the extent that such regulations are, at the time, applicable and in effect; provided, that if the Community Facilities District shall obtain an opinion of nationally recognized bond counsel to the effect that any action required under this Section is no longer required, or to the effect that some further action is required, to maintain the exclusion from gross income of the interest on the 2022 Authority Bonds pursuant to Section 103 of the Code, the Community Facilities District may rely conclusively on such opinion in complying with the provisions hereof. In the event that at any time the Community Facilities District is of the opinion that for purposes of this Section it is necessary to restrict or limit the yield on the investment of any money held by the Finance Director, for and on behalf of the Community Facilities District, hereunder or otherwise the Community Facilities District shall so instruct the Finance Director in writing, and the Finance Director shall take such action as may be necessary in accordance with such instructions.

SECTION 3.03. Covenant of the Community Facilities District Relating to Maximum Facilities Special Tax Coverage. The Community Facilities District covenants to not approve any amendments, changes or modifications relating to development of the property within the Improvement Area that would reduce the amount of the Maximum Facilities Special Tax less Priority Administrative Expenses to equal less than one hundred ten percent (110%) of the sum of the Annual Debt Service on the Bonds in any year until the maturity date for the Bonds.

SECTION 3.04. Statements of Fund and Accounts. For so long as any Bonds are Outstanding, the Trustee shall provide a monthly accounting of all funds and accounts held pursuant to the Master Indenture and any supplements thereto, including the First Supplemental Indenture, to the Community Facilities District within fifteen (15) Business Days after the end of such month and shall provide statements of account for each annual period beginning July 1 and ending June 30, within ninety (90) days after the end of such period. Such accounting shall show in reasonable detail all financial transactions during the accounting period and the balance in any accounts and funds created under the Master Indenture or any supplements thereto, including the First Supplemental Indenture, as of the beginning and the close of such accounting period.

SECTION 3.05. Amendment to Section 10.14 of the Master Indenture. Pursuant to Section 7.0l(b) of the Master Indenture, Section 10.14 of the Master Indenture is hereby amended to replace the contact information for the Trustee therein with the information included below.

If to the Trustee:

U.S. Bank Trust Company, National Association
One California Street, Suite 1000
San Francisco, CA 94111
Attention: Global Corporate Trust
Fax: 415-677-3769
Email: [email protected]
9 4125-3772-8821.3

04/12/2022 Item No.13.

SECTION 3.06. Terms of Series 2022 Bonds Subject to the Master Indenture.

Except as expressly provided in this First Supplemental Indenture, every agreement, condition, covenant, and term in the Master Indenture applies to this First Supplemental Indenture and to the Series 2022 Bonds with the same force and effect as if they were set forth at length in this First Supplemental Indenture, with such omissions, variations, and modifications as may be appropriate to conform them to this First Supplemental Indenture.

SECTION 3.07. Effective Date of First Supplemental Indenture. This First Supplemental Indenture takes effect from and after its execution and delivery. [Remainder of page intentionally blank.]
10 4125-3772-8821.3

04/12/2022 Item No.13.

IN WITNESS WHEREOF, the City of Folsom Community Facilities District No. 23 (Folsom Ranch) has caused this First Supplemental Indenture to be signed in its name by the Finance Director of the City of Folsom, and U.S. Bank Trust Company, National Association, as Trustee, in token of its acceptance of the trusts created hereunder, has caused this First Supplemental Indenture to be signed in its corporate name by its officer thereunto duly authorized, all as of the date and year first above written.

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 23
(FOLSOM RANCH)
By: _
Stacey Tamagni
Finance Director of the City of Folsom
U.S. BANK TRUST COMPANY, NATIONAL
ASSOCIATION, as Trustee
By _
Authorized Officer
11 4125-3772-8821.3

04/12/2022 Item No.13.

EXHIBIT A
FORM OF SERIES 2022 BONDS
No. - - - - - $ _

UNITED ST A TES OF AMERICA

STATE OF CALIFORNIA

COUNTY OF SACRAMENTO

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 23
(FOLSOM RANCH) IMPROVEMENT AREA NO. 1
SPECIAL TAX BOND, SERIES 2022
Interest
Rate
Maturity
Date
Dated
as of
% September 1, 20_ ~( - - ~], 2022
REGISTERED OWNER:

PRINCIPAL AMOUNT:

U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION,

AS TRUSTEE FOR THE FOLSOM RANCH FINANCING

AUTHORITY

DOLLARS
The City of Folsom Community Facilities District No. 23 (Folsom Ranch), organized and existing under and pursuant to the laws of the State of California (the "Community Facilities District"), for value received hereby promises to pay (but only out of the proceeds of the Special Tax hereinafter referred to and certain other funds as described herein) to the registered owner set forth above on the maturity date set forth above (subject to any right of prior redemption hereinafter provided for) the principal amount set forth above, together with interest thereon computed on the basis of a 360-day year of twelve (12) 30-day calendar months from the interest payment date next preceding the date of registration of this Series 2022 Bond (unless this Series 2022 Bond is registered on a day during the period from the sixteenth (16th) day of the month next preceding an interest payment date to such interest payment date, both inclusive, in which event it shall bear interest from such interest payment date, or unless this Series 2022 Bond is registered on a day on or before the fifteenth (15th) day of the month next preceding the first interest payment date, in which event it shall bear interest from its dated date) until the principal hereof shall have been paid, at the interest rate per annum set forth above, payable on (September 1, 2022], and semiannually thereafter on September 1 and March 1 in each year. The interest on and principal of and redemption premium, if any, on this Series 2022 Bond are payable in lawful money of the United States of America at the Corporate Trust Office (as that term is defined in the Indenture hereinafter referred to, and herein the "Corporate Trust Office") of U.S. Bank Trust Company, National Association, or any other bank or trust company at its Corporate Trust Office, which may A-1
4125-3772-8821.3

04/12/2022 Item No.13.
at any time be substituted in its place as provided in the Indenture hereinafter described, the Trustee of the Community Facilities District for the Bonds (the "Trustee"). The interest on this Series 2022 Bond due on or before the maturity or prior redemption hereof shall be payable only to the person whose name appears in the registration books required to be kept by the Trustee as the registered owner hereof at the close of business as of the fifteenth (15th) day of the month next preceding each interest payment date, such interest to be paid by check mailed by first class mail on each such interest payment date to such registered owner at his or her address as it appears on such books, except that in the case of a registered owner of one million dollars ($1,000,000) or more in principal amount of Bonds then Outstanding, payment shall be made at such owner's option by wire transfer on each such interest payment date of immediately available funds to an account in a bank or trust company or savings bank that is a member of the Federal Reserve System and that is located in the continental United States of America according to written instructions provided by such owner to the Trustee at least fifteen (15) days before such interest payment date.

The principal of and redemption premium, if any, on this Series 2022 Bond shall be payable only to the person whose name appears in such registration books as the registered owner hereof, such principal and redemption premium, if any, to be paid only on the surrender of this Series 2022 Bond at the Corporate Trust Office of the Trustee at maturity or on redemption prior to maturity.

Notwithstanding the foregoing, the Trustee may agree with the Holder of this Series 2022 Bond that such Holder may, in lieu of surrendering the same for a new Bond, endorse on this Series 2022 Bond a record of partial payment of the principal of this Series 2022 Bond as follows:

PAYMENTS ON ACCOUNT OF PRINCIPAL
Payment Date
Principal
Amount Paid
Balance of Principal
Amount Unpaid
Signature
of Holder
This Series 2022 Bond is one of a duly authorized issue of bonds in the aggregate principal amount of [ ] dollars ($[ ]) issued by the Community Facilities District located in the City of Folsom (the "City"), designated the "City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 1 Special Tax Bonds, Series 2022" (the "Series 2022 Bonds"), which Series 2022 Bonds are issued under and pursuant to the Mello-Roos Community Facilities Act of 1982, as amended (being Sections 53311 et seq. of the Government Code of the State of California), and all laws amendatory thereof or supplemental thereto (the "Law") and under and pursuant to the provisions of an Indenture, dated as of October 1, 2020 (as supplemented, the "Master Indenture"), between the Community Facilities District and the Trustee, as successor trustee to MUFG Union Bank, N.A., which Master Indenture authorized the issuance in various series from time to time of "City of Folsom Community Facilities District A-2
4125-3772-8821.3

04/12/2022 Item No.13.

No. 23 (Folsom Ranch) Improvement Area No. 1 Special Tax Bonds" (the "Bonds"), and a First Supplemental Indenture (the "First Supplemental Indenture," and together with the Master Indenture, the "Indenture") supplemental thereto, dated as of May 1, 2022, between the Community Facilities District and the Trustee, all ofl ike tenor and date ( except for such variations, if any, as may be required to designate varying numbers, maturities, interest rates or redemption provisions of the Series 2022 Bonds), and all capitalized terms used herein not otherwise defined shall have the meanings contained in the Indenture. All the Series 2022 Bonds are payable on a parity with all other Bonds issued under the Master Indenture in accordance with the terms and conditions of the Indenture ( copies of which are on file at the office of the City Clerk of the City and at the above-mentioned office of the Trustee), and reference is hereby made to the Law and to the Indenture and any and all amendments thereof and supplements thereto for a description of the terms on which the Series 2022 Bonds are issued and for the rights of the registered owners of the Series 2022 Bonds; and all the terms of the Law and the Indenture are hereby incorporated herein and constitute a contract between the Community Facilities District and the registered owner from time to time of this Series 2022 Bond, to all the provisions of which the registered owner of this Series 2022 Bond, by his or her acceptance hereof, agrees and consents; and each taker and subsequent registered owner hereof shall have recourse to all the provisions of the Law and the Indenture and shall be bound by all the terms and conditions thereof.

The Series 2022 Bonds are issued to provide funds to pay costs of the acquisition and construction of the Facilities, make a deposit to the Series 2022 Bond Reserve Account, pay Costs of Issuance of the Series 2022 Bonds in accordance with the Indenture and pay interest on the Series 2022 Bonds to [September 1, 2022]. The Series 2022 Bonds are special tax obligations of the Community Facilities District and the interest on and principal of and redemption premiums, if any, on the Series 2022 Bonds are payable solely from the proceeds of the Special Tax, net of Priority Administrative Expenses, and certain other funds, as provided in the Indenture, and the Community Facilities District is not obligated to pay them except from the proceeds of the Special Tax, net of Priority Administrative Expenses, and such other funds. The General Fund of the City and the funds of the Community Facilities District are not liable and neither the full faith and credit of the Community Facilities District nor the City are pledged for the payment of the interest on or the principal of or the redemption premiums, if any, on the Series 2022 Bonds, and no tax or assessment other than the Special Tax shall ever be levied or collected to pay the interest on or the principal of or the redemption premiums, if any, on the Series 2022 Bonds. The Series 2022 Bonds are not secured by a legal or equitable pledge of or charge, lien or encumbrance upon any property of the Community Facilities District or any of its income or receipts except the proceeds of the Special Tax, net of Priority Administrative Expenses, and such other funds, and neither the payment of the interest on or the principal of or the redemption premiums, if any, on the Series 2022 Bonds is a general debt, liability or obligation of the Community Facilities District.

The Series 2022 Bonds maturing on September 1, 20L ], are subject to mandatory redemption by the Community Facilities District prior to their maturity date in part on September 1 in each of the years 20[_] through 20[_] , both years inclusive; and the Series 2022 Bonds maturing on September 1, 20[_] , are subject to mandatory redemption by the Community Facilities District prior to their maturity date in part on September 1 in each of the years 20L ] through 20[_] , both years inclusive, in each case solely from Minimum Sinking Fund Account Payments deposited in the Sinking Fund Subaccount, upon mailed notice as hereinafter provided, A-3
4125-3772-8821.3

04/12/2022 Item No.13.
at a redemption price of one hundred percent (100%) of the principal amount thereof called for redemption together with accrued interest thereon to the date of redemption.

The Series 2022 Bonds are subject to optional redemption by the Community Facilities District prior to their respective maturity dates as a whole or in part on any date on or after September 1, 20LJ , from funds derived by the Community Facilities District from any source other than such Minimum Sinking Fund Account Payments deposited in the Sinking Fund Subaccount or such prepayments of the Special Tax, upon mailed notice as hereinafter provided, at the following redemption prices ( computed upon the principal amount of the Series 2022 Bonds or portions thereof called for redemption) together with accrued interest thereon to the date fixed for redemption, to wit:
103% if redeemed on any date on or after September 1, 20L ] through August 31, 20L] ;
102% if redeemed on any date from September 1, 20LJ through August 31, 20L ];
101 % if redeemed on any date from September 1, 20LJ through August 31, 20LJ ; and
100% if redeemed on September 1, 20L ] and any date thereafter.

The Series 2022 Bonds are subject to extraordinary redemption by the Community Facilities District prior to their respective maturity dates, as a whole or in part on any interest payment date on and after September 1, 20L ], from funds derived by the Community Facilities District from prepayments of the Special Tax, upon mailed notice as hereinafter provided, at the following redemption prices ( computed upon the principal amount of the Series 2022 Bonds or portions thereof called for redemption) together with accrued interest thereon to the date fixed for redemption, to wit:
103% if redeemed on an interest payment date on or after September 1, 20LJ through March 1, 20L ];
102% if redeemed on an interest payment date on September 1, 20L ] or March 1, 20L ];
101 % if redeemed on an interest payment date on September 1, 20L ] or March 1, 20L ]; and
100% if redeemed on September 1, 20L ] or any interest payment date thereafter.

If less than all the Series 2022 Bonds are to be redeemed as a result of prepayments of the Special Tax at any one time, the Series 2022 Bonds shall be redeemed pro rata by maturity.

Ifl ess than all the Series 2022 Bonds are to be redeemed at the option of the Community Facilities District at any one time, the Series 2022 Bonds of the latest maturity date or dates shall be redeemed prior to or simultaneously with the redemption of the Series 2022 Bonds maturing prior A-4
4125-3772-8821.3

04/12/2022 Item No.13.
thereto, and if less than all the Series 2022 Bonds of any one maturity date are to be redeemed at any one time, the Trustee shall select the Series 2022 Bonds or the portions thereof of such maturity date to be redeemed in integral multiples of five thousand dollars ($5,000) in a manner that it deems appropriate and fair.

Notice of redemption of this Series 2022 Bond or any portion hereof shall be mailed by the Trustee to the registered owner hereof and to those securities depositories and securities information services selected by the Community Facilities District in accordance with the Indenture, but neither failure to receive any such mailed notice nor any immaterial defect contained therein shall affect the sufficiency or validity of such proceedings for redemption. Any notice of optional redemption may be rescinded by written notice given by the Community Facilities District to the Trustee no later than three (3) Business Days prior to the date specified for redemption. The Trustee shall give notice of rescission of the notice of optional redemption or non-satisfaction of any conditions specified in the notice of optional redemption as soon as practicable to the same parties and in the same manner as the notice of redemption was given pursuant to the Indenture.

If notice of redemption has been duly given and not rescinded as aforesaid and money sufficient for the payment of the principal of and redemption premiums, if any, on, together with interest to the redemption date on, this Series 2022 Bond or portion thereof so called for redemption has been irrevocably deposited with the Trustee, then this Series 2022 Bond or the portion thereof to be redeemed shall, on the redemption date designated in such notice, become due and payable at the above-described redemption price; and from and after the date so designated interest on this Series 2022 Bond or the portion thereof to be redeemed shall cease to accrue and the registered owner of this Series 2022 Bond shall have no rights in respect hereof except to receive payment of the redemption price of this Series 2022 Bond or the portion thereof to be redeemed, and upon surrender of this Series 2022 Bond if redeemed in part only, the Community Facilities District shall execute and the Trustee shall authenticate and deliver to the registered owner hereof at the expense of the Community Facilities District a new Series 2022 Bond or Series 2022 Bonds equal in aggregate principal amount to the unredeemed portion of this Series 2022 Bond so surrendered.

The Community Facilities District has covenanted that, so long as any Series 2022 Bonds are outstanding, it will annually levy the Special Tax against all Taxable Property in the Improvement Area and make provision for the collection of the Special Tax in amounts which will be sufficient, together with the money then on deposit in the Redemption Account, after making reasonable allowances for contingencies and errors in the estimates, to yield proceeds equal to the amounts required for compliance with the agreements, conditions, covenants and terms contained in the Indenture, and which in any event will be sufficient to pay the interest on and principal of and Minimum Sinking Fund Account Payments for and redemption premiums, if any, on the Series 2022 Bonds as they become due and payable and to replenish each Bond Reserve Account established under the Indenture and to pay all current Expenses as they become due and payable in accordance with the provisions and terms of the Indenture.

The Series 2022 Bonds are issuable in the form of fully registered bonds. The registered owner of any Series 2022 Bond or Series 2022 Bonds may surrender the same (together with a written instrument of transfer satisfactory to the Trustee duly executed by the registered owner or his or her duly authorized attorney) in exchange for an equal aggregate principal amount A-5
4125-3772-8821.3

04/12/2022 Item No.13.
of Series 2022 Bonds of the same series and maturity date in the manner, subject to the conditions and upon payment of the charges provided in the Indenture.

The registration of this Series 2022 Bond is transferable on the registration books kept by the Trustee by the registered owner hereof or by his or her duly authorized attorney upon surrender of this Series 2022 Bond together with a written instrument of transfer satisfactory to the Trustee duly executed by the registered owner or his or her duly authorized attorney, and thereupon a new Series 2022 Bond or Series 2022 Bonds of the same series and maturity date in the same aggregate principal amount will be issued to the transferee in exchange therefor in the manner, subject to the conditions and terms and upon payment of the charges provided in the Indenture. The Community Facilities District and the Trustee shall be entitled to conclusively treat the person in whose name this Series 2022 Bond is registered as the absolute owner hereof for the purpose of receiving payment of, or on account of, the principal hereof and redemption premium, if any, hereon and for all other purposes.

The rights and obligations of the Community Facilities District and of the registered owners of the Series 2022 Bonds may be amended at any time in the manner, to the extent and upon the terms provided in the Indenture, and in certain circumstances without the consent of such registered owners, but no such amendment shall (1) extend the maturity of this Series 2022 Bond or reduce the interest rate hereon or otherwise alter or impair the obligation of the Community Facilities District to pay the interest hereon or principal hereof or Minimum Sinking Fund Account Payment herefor or redemption premium, if any, hereon at the time and place and at the rate and in the currency and from the funds provided herein without the express written consent of the registered owner of this Series 2022 Bond, or (2) permit the issuance by the Community Facilities District of any obligations payable from the proceeds of the Special Tax other than as provided in the Indenture, or jeopardize the ability of the Community Facilities District to levy and collect the Special Tax, or (3) reduce the percentage of Series 2022 Bonds required for the written consent to an amendment of the Indenture, or (4) modify any rights or obligations of the Trustee without its prior written assent thereto; all as more fully set forth in the Indenture.

The Series 2022 Bonds do not constitute an indebtedness of the Community Facilities District within the meaning of any constitutional or statutory debt limitation or restriction, and neither the City Council of the City nor the Community Facilities District nor any officer or employee thereof or of the City shall be liable for the payment of the interest on or principal of or redemption premiums, if any, on the Series 2022 Bonds otherwise than from the proceeds of the Special Tax, net of Priority Administrative Expenses, and such other funds, as provided in the Indenture.

This Series 2022 Bond shall not be entitled to any benefits under the Indenture or become valid or obligatory for any purpose until the certificate of authentication and registration hereon endorsed shall have been manually signed by an authorized signatory of the Trustee.

It is hereby certified that all acts, conditions and things required by law to exist, to have happened and to have been performed precedent to and in the issuance of this Series 2022 Bond do exist, have happened and have been performed in due time, form and manner as required by law and that the amount of this Series 2022 Bond, together with all other obligations of the Community Facilities District, does not exceed any limit prescribed by the laws of the State of A-6
4125-3772-8821.3

04/12/2022 Item No.13.

California and is not in excess of the principal amount of the Series 2022 Bonds permitted to be issued under the Indenture.

A-7
4125-3772-8821.3

04/12/2022 Item No.13.

IN WITNESS WHEREOF, the City of Folsom Community Facilities District No. 23 (Folsom Ranch) has caused this Series 2022 Bond to be executed in its name and on its behalf by the manual or facsimile signature of the Mayor of the City and countersigned by the manual or facsimile signature of the City Clerk of the City, and has caused this Series 2022 Bond to be dated [ ], 2022.

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 23
(FOLSOM RANCH)
By _
Mayor of the City of Folsom
Countersigned:

City Clerk of the City of Folsom
A-8
4125-3 772-8821.3

04/12/2022 Item No.13.
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION
TO APPEAR ON SERIES 2022 BONDS]
This is one of the Series 2022 Bonds described in the within-mentioned Indenture which has been authenticated on [ ], 2022.

U.S. BANK TRUST COMPANY, NATIONAL

ASSOCIATION,
as Trustee
By _
Authorized Signatory
[FORM OF ASSIGNMENT TO APPEAR ON SERIES 2022 BONDS]
For value received the undersigned do(es) hereby sell, assign and transfer unto _ _ _ _ _ _ the within Series 2022 Bond and do( es) hereby irrevocably constitute and appoint attorney to transfer the same on the bond register of the Trustee, with full power of substitution in the premises.

Dated: - - - - - - - - -
SIGNATURE GUARANTEED BY:

Note: Signatures must be guaranteed by an "eligible guarantor institution" meeting the requirements of membership or participation in the Security Transfer Agent Medallion Program ("ST AMP") or such other "signature guarantee program" as may be determined in substitution for ST AMP, all in accordance with the Securities Exchange Act of 1934, as amended.

Social Security Number, Taxpayer Identification Number or other identifying number of Assignee: _
A-9
4125-3772-8821.3

04/12/2022 Item No.13.

ATTACHMENT 5

04/12/2022 Item No.13.

OH&SDRAFT
4/5/22
PRELIMINARY OFFICIAL STATEMENT DATED I ), 2022

NEW ISSUE-BOOK-ENTRY ONLY NOT RATED
In the opinion of Orrick, Herrington & Sutcliffe LLP, Bond Counsel to the Authority, based upon an analysis of existing laws, regulations, rulings and court decisions, and assuming, among other matters, the accuracy of certain representations and compliance with certain covenants, interest on the Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986 and is exempt from State of California personal income taxes. In the further opinion of Bond Counsel, interest on the Bonds is not a specific preference item for purposes of the federal alternative minimum tax. Bond Counsel expresses no opinion regarding any other tax consequences related to the ownership or disposition of. or the amount, accrual or receipt of interest on, the Bonds. See "TAX MATTERS." $13,235,000 •

FOLSOM RANCH FINANCING AUTHORITY
CITY OF FOLSOM COMMUNITY FACILITIES DISTRICT NO. 23
(FOLSOM RANCH) IMPROVEMENT AREA NO. 1

SPECIAL TAX REVENUE BONDS
SERIES 2022
Dated: Date of Delivery Due: September 1, as shown on inside front cover The Folsom Ranch Financing Authority City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. I Special Tax Revenue Bonds, Series 2022 (the "Bonds") are being issued by the Folsom Ranch Financing Authority (the "Authority") to provide funds to finance the purchase of limited obligation special tax bonds (the "Local Obligations"), issued by the City of Folsom Community Facilities District No. 23 (Folsom Ranch) (the "District"). The purchase price of the Local Obligations will be used to finance the acquisition and construction of certain public facilities, fund a debt service reserve account, fund capitalized interest to September I, 2022, and pay certain costs of issuance of the Local Obligations and Bonds.

The Bonds are being issued by the Authority pursuant to a Trust Agreement (the "Trust Agreement") among the District, the Authority and U.S. Bank Trust Company, National Association, as trustee (the "Trustee") and will be secured by a pledge of the Trust Estate, as defined herein. See "SECURITY AND SOURCES OF PAYMENT FOR THE BONDS." The Bonds are special, limited obligations of the Authority. The Bonds are payable solely from and secured by the Trust Estate of the Authority pledged under the Trust Agreement, consisting primarily of payments received by the Authority from the District under the Local Obligations, which payments are secured by a lien of the Special Taxes (defined herein) levied upon property within Improvement Area No. I of the District (the "Improvement Area"), as more fully described herein. Payments under the Local Obligations are calculated to be sufficient to permit the Authority to pay the principal of, and interest on, the Bonds when due.

The Local Obligations are secured by the lien of the net Special Taxes on parity with the 2020 IA I Obligations and any Additional Local Obligations (each defined herein). See "SECURITY AND SOURCES OF PAYMENT FOR THE BONDS­ Terms of the Local Obligations."
The Local Obligations Indenture (defined herein) for the Local Obligations establishes a debt service reserve fund (the "Local Obligations Reserve Fund") with a debt service reserve account therein for the Local Obligations (the "Local Obligations Reserve Account"). Pursuant to the Local Obligations Indenture, a deposit is being made to the Local Obligations Reserve Account for the Local Obligations. Amounts available from the Local Obligations Reserve Account are not available to make up a deficiency for the payment of principal and interest on the Bonds. See "SECURITY AND SOURCES OF PAYMENT FOR THE BONDS- Terms of the Local Obligations- Local Obligations Reserve Account." The Bonds are being issued only as fully registered bonds registered in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York ("DTC") and interest thereon is payable on March I and September I of each year, commencing September 1, 2022, by the Trustee to DTC. DTC will in turn remit principal or redemption price and interest to the DTC participants, which will in tum remit such principal or redemption price and interest to the Beneficial Owners of the Bonds, as described herein. DTC will act as securities depository for the Bonds. Individual purchases will be made in book-entry only form in the principal amount of $5,000 or integral multiple thereof. Purchasers of the Bonds will not receive instruments representing their interest in the Bonds purchased. See APPENDIX F- "DTC AND THE BOOK- ENTRY ONLY SYSTEM." The Bonds are subject to optional, extraordinary and mandatory redemption as described herein.' See "THE BONDS­ Redemption Provisions."
• Preliminary, subject to change.

04/12/2022 Item No.13.

NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE CITY OF FOLSOM (THE "CITY"),

THE AUTHORITY, THE STATE OF CALIFORNIA OR ANY OTHER POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE BONDS. THE AUTHORITY HAS NO TAXING POWER. EXCEPT FOR THE TRUST ESTATE, NO OTHER REVENUES OR TAXES ARE PLEDGED TO THE PAYMENT OF THE BONDS. THE BONDS ARE

NOT GENERAL OBLIGATIONS OF THE AUTHORITY, THE DISTRICT OR THE CITY, BUT ARE LIMITED

OBLIGATIONS OF THE AUTHORITY PAYABLE SOLELY FROM THE TRUST ESTATE, DERIVED PRIMARILY FROM

PAYMENT ON THE LOCAL OBLIGATIONS FROM THE PAYMENT OF THE SPECIAL TAXES LEVIED WITHIN THE IMPROVEMENT AREA AS MORE FULLY DESCRIBED HEREIN.

The Bonds are not rated by any rating agency. Investment in the Bonds involves a substantial degree of risk that may not be appropriate for some investors. See "CERTAIN RISKS TO BONDHOLDERS" for a discussion of special risk factors that should be considered, in addition to the other matters set forth herein, in evaluating the investment quality of the Bonds ..

This cover page contains information for general reference only and it is not a complete summary of the Bonds. Investors should read the entire Official Statement to obtain information essential to the making of an informed investment decision.

Maturity Schedule, Interest Rates, Prices and CUSIPS
(See inside front cover)
The Bonds are offered when, as and if issued, subject to the approval as to their legality by Orrick, Herrington & Sutcliffe LLP, Bond Counsel to the Authority, and certain other conditions. Certain legal matters will be passed on for the Authority and the District by the City Attorney. Certain legal matters will be passed upon for the Underwriter by Stradling, Yocca, Carlson & Rauth, a Professional Corporation. It is anticipated that the Bonds in book-entry form will be available for delivery through the facilities of The Depository Trust Company in New York, New York on or about [ ], 2022.

Piper Sandler & Co.

The date of this Official Statement is , 2022.

04/12/2022 Item No.13.
$13,235,000*

FOLSOM RANCH FINANCING AUTHORITY
CITY OF FOLSOM COMMUNITY FACILITIES DISTRICT NO. 23
(FOLSOM RANCH) IMPROVEMENT AREA NO. 1

SPECIAL TAX REVENUE BONDS
SERIES 2022

MATURITY SCHEDULE, INTEREST RA TES, PRICES AND CUSIPS
Maturity
(September 1)
Principal
Amount
$
Interest
Rate Price
CUSIPNo.1
(344414)
%
$ % Term Bond maturing September 1, 20_ Price (CUSIPNo.t 344414__J $ % Term Bond maturing September 1, 20_ Price (CUSIP No.t 344414__J Preliminary, subject to change.
t CUSIP® is a registered trademark of the American Bankers Association. CUSIP Global Services (CGS) is managed on behalf of the American Bankers Association by FactSet Research Systems Inc. Copyright© 2022 CUSIP Global Services.

All rights reserved. CUSIP® data herein is provided by CUSIP Global Services. This data is not intended to create a database and does not serve in any way as a substitute for the CGS database. CUSIP numbers are provided for convenience of reference only. The Authority, the District, the Underwriter and the City take no responsibility for the accuracy of such numbers.

04/12/2022 Item No.13.

No dealer, broker, salesperson or other person has been authorized by the Authority, the District or the Underwriter to give any information or to make any representations other than as contained in this Official Statement, and if given or made, such other information or representations must not be relied upon as having been authorized by any of the foregoing. This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the Bonds by any person, in any jurisdiction in which it is unlawful for such person to make such offer, solicitation or sale. This Official Statement is not to be construed as a contract with the purchasers of the Bonds. Statements contained in this Official Statement which involve estimates, forecasts or matters of opinion, whether or not expressly so described herein, are intended solely as such and are not to be construed as representations of fact.

The information set forth herein has been obtained from sources which are believed to be reliable, but such information is neither guaranteed as to accuracy or completeness, nor is it to be construed as a representation of such by the Authority, the District or the Underwriter. The information and expressions of opinion stated herein are subject to change without notice; and neither the delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the Authority, the District or the property owners in the Improvement Area, or in the condition of the property in the Improvement Area, since the date hereof.

The summaries and references to the Trust Agreement, the Mello-Roos Act, the Local Obligations Indenture and to other statutes and documents referred to herein do not purport to be comprehensive or definitive and are qualified in their entireties by reference to each such statute and document. This Official Statement including any amendment or supplement hereto is intended to be deposited with one or more depositories.

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, their 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.

IN CONNECTION WITH THIS OFFERING, THE UNDERWRITER MAY OVERALLOT OR EFFECT

TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. THE UNDERWRITER MAY OFFER AND SELL

THE BONDS TO CERTAIN DEALERS AND OTHERS AT PRICES LOWER THAN THE PUBLIC OFFERING

PRICES SET FORTH ON THE INSIDE FRONT COVER PAGE HEREOF AND SUCH PUBLIC OFFERING PRICES MAY BE CHANGED FROM TIME TO TIME BY THE UNDERWRITER.

THE BONDS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS

AMENDED, IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS CONTAINED IN SUCH ACT. THE BONDS HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES LAWS OF ANY STATE.

Certain statements included or incorporated by reference in this Official Statement constitute forward­ looking statements. Such statements are generally identifiable by the terminology used such as "plan," "expect," "estimate," "budget" or 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.

04/12/2022 Item No.13.

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 23
(FOLSOM RANCH)

BOUNDARY MAP

04/12/2022 Item No.13.

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 23
(FOLSOM RANCH)
IMPROVEMENT AREA NO. 1

04/12/2022 Item No.13.

AUTHORITY GOVERNING BOARD/CITY COUNCIL
Kerri Howell, Chair I Mayor
Rosario Rodriguez, Vice Chair I Vice Mayor
Sarah Aquino, Member I Councilmember
YK Chalamcherla, Member I Councilmember
Mike Kozlowski, Member I Councilmember

AUTHORITY/CITY STAFF
Elaine Andersen, Executive Director I City Manager
Stacey Tamagni, Treasurer I Finance Director
Steven Wang, Esq., General Counsel I City Attorney
Christa Freemantle, Secretary I City Clerk

SPECIAL SERVICES

BOND AND DISCLOSURE COUNSEL
Orrick, Herrington & Sutcliffe LLP

TRUSTEE
U.S. Bank Trust Company, National Association

MUNICIPAL ADVISOR
Fieldman, Rolapp & Associates, Inc.

SPECIAL TAX CONSULTANT
NBS

APPRAISER
Integra Realty Resources

04/12/2022 Item No.13.

TABLE OF CONTENTS
Page Page
INTRODUCTION 1
General 1
Authority for Issuance 1
Purpose 1
Security for the Bonds 2
The Improvement Area 3
Property Ownership and
Development Status 3
Property Values 7
Bondholders Risks 7
Continuing Disclosure 7
Summaries Not Definitive 7
FOLSOM PLAN AREA 8
General Folsom Plan Area Plan
of Finance 8
Public Facilities Financing Plan 8
PLAN OF FINANCE 10
Facilities to be Financed 10
THE BONDS 11
General 11
Description of the Bonds 11
Redemption Provisions 12

ESTIMATED SOURCES AND USES
OF FUNDS 16
DEBT SERVICE SCHEDULE 17

SECURITY AND SOURCES OF
PAYMENT FOR THE BONDS 18
General 19
Flow of Funds 19
Description of Local
Obligations 20
Issuance of Local Obligations 20
Payment of the Local
Obligations 21
Local Obligations Flow of
Funds 22
Special Tax Authorization 24
Covenant for Foreclosure 25
No Required Advances from
Available Surplus Funds 26
Terms of the Local Obligations 26
Special Tax Analysis 29
Special Tax Calculation 36
The Teeter Plan 38
THE AUTHORITY 39
THE CITY 39
THE IMPROVEMENT AREA 39
General Description and
Location 39
Property Values 40
Value-to-Lien Analysis .41
Estimated Tax Burden on Single
Family Home 45
Overlapping Debt. .46

PROPOSED PROPERTY
DEVELOPMENT 47
Development Entitlements 47
Property Ownership 56
Development Plan and Status of
Development. 61
COVID-19 Impact 68
Development Plans of Finance 69

CERTAIN RISKS TO
BONDHOLDERS 79
Risks of Real Estate Secured
Investments Generally 79
Levy of the Special Tax 80
Collection of Special Tax 80
Shapiro v. San Diego 81
Concentration of Ownership 82
Payment of the Special Tax is
Not a Personal Obligation of a
Property Owner 82
Potential Early Redemption of
Bonds from Prepaid Special
Taxes 83
Special Tax Delinquencies 83
Teeter Plan Termination 83
Land Values 83
Appraisal Risks 84
Zoning and Land Use Decisions 84
Exempt Properties 84
Maximum Special Tax 85
Ballot Initiatives and Measures 85
Recent Changes to Federal
Income Tax Law 85
Disclosures to Future
Purchasers 86
Parity Taxes and Special
Assessments 86
Bankruptcy 87
Geologic, Topographic and
Climatic Conditions 87
Potential Impact of Global
Health Crises or Concerns 88
Failure to Develop 89
Future Private Indebtedness 90
No Independent Review of
Valuation or Viability of
Completed Projects 90

04/12/2022 Item No.13.

TABLE OF CONTENTS
(continued)
Page Page
Endangered Species 91
Hazardous Substances 91
Naturally Occurring Asbestos 92
Naturally Occurring Arsenic 92
FDIC/Federal Government
Interests in Properties 93
No Acceleration Provision 94
Loss of Tax Exemption 94
LEGAL MATTERS 94
TAX MATTERS 95

APPENDIX A - RA TE, METHOD OF APPORTIONMENT AND MANNER OF COLLECTION OF

SPECIAL TAX

APPENDIX B - ECONOMIC AND DEMOGRAPHIC INFORMATION RELATING TO THE CITY

OF FOLSOM

APPENDIX C- SUMMARY OF PRINCIPAL DOCUMENTS

APPENDIX D - FORMS OF CONTINUING DISCLOSURE UNDERTAKINGS

APPENDIX E - PROPOSED FORM OF OPINION OF BOND COUNSEL

APPENDIX F - OTC AND THE BOOK-ENTRY ONLY SYSTEM

APPENDIX G - APPRAISAL
NO LITIGATION 97
NO RATING 97
MUNICIPAL ADVISOR 97
UNDERWRITING 97
CONTINUING DISCLOSURE 98
The District 98
KB HOME Sacramento and Tri
Pointe 98
MISCELLANEOUS 99
II

04/12/2022 Item No.13.
$13,235,000*

FOLSOM RANCH FINANCING AUTHORITY
CITY OF FOLSOM COMMUNITY FACILITIES DISTRICT NO. 23
(FOLSOM RANCH) IMPROVEMENT AREA NO. 1

SPECIAL TAX REVENUE BONDS
SERIES 2022

INTRODUCTION
The description and summaries of various documents hereinafter set forth do not purport to be comprehensive or definitive, and reference is made to each document for the complete details of all terms and conditions. All statements herein are qualified in their entirety by reference to each document. All capitalized terms used in this Official Statement and not otherwise defined herein have the same meaning as in the Trust Agreement (defined below) or the Local Obligations Indenture (defined below), as applicable.

General
This Official Statement, including the cover page, the inside cover page and the Appendices hereto, is provided to furnish certain information in connection with the issuance and sale by the Folsom Ranch Financing Authority (the "Authority") of $13,235,000* aggregate principal amount of Folsom Ranch Financing Authority City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 1 Special Tax Revenue Bonds, Series 2022 (the "Bonds").

Authority for Issuance
The Bonds will be issued pursuant to the provisions of the Trust Agreement (the "Trust Agreement") among the Authority, the City of Folsom Community Facilities District No. 23 (Folsom Ranch) (the "District"), and U.S. Bank Trust Company, National Association, as trustee (the "Trustee"), as authorized pursuant to a resolution of the Authority. The Bonds will be issued pursuant to the Marks­ Roos Local Bond Pooling Act of 1985, as amended, constituting Article 4 of Chapter 5, Division 7, Title 1 of the Government Code of the State of California. The Bonds will be issued as fully registered bonds in book-entry form, in denominations of $5,000 each or any integral multiple thereof and will be dated the date of delivery thereof and bear interest at the rates set forth on the inside front cover page hereof. See "THE BONDS- Description of the Bonds."
Purpose
The Bonds are being issued to finance the purchase of the limited obligation special tax bonds (the "Local Obligations"), issued by the District pursuant to an Indenture (as supplemented and amended, the "Local Obligations Indenture") between the District and U.S. Bank Trust Company, National Association, as successor trustee to U.S. Bank National Association, as successor trustee to MUFG Union Bank, N.A., as trustee (the "Local Obligations Trustee"), as supplemented and amended by a First Supplemental Indenture (the "First Supplemental Indenture") between the District and the Local Obligations Trustee. The purchase price of the Local Obligations will be used to finance the acquisition and construction of certain public facilities, fund a debt service reserve account, fund capitalized interest to September 1, 2022, and pay certain costs of issuance of the Local Obligations and Bonds. See "PLAN OF FINANCE" and "THE IMPROVEMENT AREA."
• Preliminary, subject to change.

04/12/2022 Item No.13.

The Local Obligations are authorized pursuant to (i) the provisrons of the Mello-Roos Community Facilities Act of 1982, as amended, constituting Section 53311, et seq. of the California Government Code (the "Mello-Roos Act"), (ii) a resolution of the City Council of the City of Folsom (the "City") as legislative body of the District adopted on April 12, 2022, and (iii) the Local Obligations Indenture. The Local Obligations are payable from the special taxes authorized to be levied and collected annually upon taxable real property within Improvement Area No. 1 of the District (the "Improvement Area"). See "SECURITY AND SOURCES OF PAYMENT FOR THE BONDS- General." Security for the Bonds
The Bonds are special, limited obligations of the Authority, payable from and secured by the Trust Estate (as defined herein) received by the Authority consisting primarily of payments received from the District as debt service payments on the Local Obligations.

The Local Obligations will be issued with an annual scheduled debt service schedule that results in at least 110% annual debt service coverage for the Local Obligations and the 2020 IA 1 Obligations from Effective Tax Rate Evaluation Maximum Facilities Special Tax revenues for Developed Property and Effective Tax Rate Evaluation Minimum Facilities Revenues for Small Lot Final Map Property expected to be generated in the Improvement Area (except for Lots C and D), net of Priority Administrative Expenses (each as defined below). Although the scheduled payments under the Local Obligations are sufficient, in the aggregate, to provide the Authority with moneys to pay the principal of, premium, if any, and interest on the Bonds when due (see "SECURITY AND SOURCES OF PAYMENT FOR THE BONDS"), investment in the Bonds involves a substantial degree of risk that may not be appropriate for some investors. See "CERTAIN RISKS TO BONDHOLDERS" below.

The Local Obligations are secured by a pledge of special taxes received by the District (the "Special Tax" or the "Special Taxes," as the context requires) (including any prepayment thereof and proceeds from foreclosure sales pursuant to the Local Obligations Indenture), net of Priority Administrative Expenses, and the Local Obligations Reserve Account established under the Local Obligations Indenture. See "SECURITY AND SOURCES OF PAYMENT FOR THE BONDS." The Special Taxes are included on the regular property tax bill sent to the record owners of taxable properties within the Improvement Area. The District has covenanted in the Local Obligations Indenture to commence judicial foreclosure proceedings against property with delinquent Special Taxes and to diligently pursue such proceedings to completion; provided, however, that the District is not obligated under the Local Obligations Indenture to commence such judicial foreclosure proceedings on any delinquent installment of the Special Tax for any Fiscal Year in which the District has received one hundred percent (100%) of the amount of such installment from the County of Sacramento (the "County") pursuant to the Teeter Plan (described below). See "SECURITY AND SOURCES OF PAYMENT FOR THE BONDS- Payment of the Local Obligations," "- Special Tax Authorization," "- Covenant for Foreclosure" and "- The Teeter Plan."
The Special Taxes secure only the Local Obligations and the 2020 IAl Obligations (as defined herein). For this reason, a delinquency or default in the payment of Special Taxes could cause a default in the payments of principal and interest on the Bonds if moneys in the Local Obligations Reserve Account are insufficient to make up the deficit in debt service for the Local Obligations caused by such delinquency or nonpayment.

NEITHER THE FULL FAITH AND CREDIT NOR THE TAXING POWER OF THE CITY, THE DISTRICT, THE AUTHORITY, THE STATE OF CALIFORNIA (THE "STATE") OR ANY

OTHER POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE BONDS. THE AUTHORITY HAS NO TAXING POWER. EXCEPT FOR THE TRUST ESTATE, NO 2

04/12/2022 Item No.13.

OTHER REVENUES OR TAXES ARE PLEDGED TO THE PAYMENT OF THE BONDS. THE

BONDS ARE NOT GENERAL OBLIGATIONS OF THE AUTHORITY, THE DISTRICT OR THE

CITY, BUT ARE LIMITED OBLIGATIONS OF THE AUTHORITY PAY ABLE SOLELY FROM THE

TRUST ESTATE, DERIVED PRIMARILY FROM DEBT SERVICE PAYMENTS ON THE LOCAL

OBLIGATIONS FROM THE PAYMENT OF THE SPECIAL TAXES LEVIED WITHIN THE IMPROVEMENT AREA AS MORE FULLY DESCRIBED HEREIN.

The Improvement Area
General. The Improvement Area is located in the southern portion of the City, east of East Bidwell Street, west of Placerville Road, north of Mangini Parkway and south of U.S. Highway 50 and consists of over 205 total gross acres, of which approximately 109 acres are subject to the Special Tax.

Presently, the Improvement Area includes properties in varying stages of development, including partially-improved lots, improved lots, homes under construction and completed homes. Collectively, these properties are planned to include 441 single-family high density units, 222 multi-family low density units and 265 multi-family high density units that are expected to be constructed as apartments.

Formation Proceedings. The District was formed by the City pursuant to the Mello-Roos Act.

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

Pursuant to the Mello-Roos Act, the City Council undertook proceedings to form the District, initially designating six separate improvement areas therein, including the Improvement Area, and called an election to authorize the incurring of bonded indebtedness and authorize the levy of special taxes within the District. On May 26, 2020, elections were held within the District for each improvement area therein at which the eligible voters in each improvement area approved the levy of special taxes in accordance with the respective Rate and Method of Apportionment of Special Tax for such improvement area. In addition, the eligible voters in the Improvement Area authorized the issuance of bonds in an amount not to exceed $76,000,000 for the Improvement Area. The Rate and Method of Apportionment for Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 1 (the "Rate and Method of Apportionment") is included as APPENDIX A hereto and summarized herein under 'SECURITY AND SOURCES OF PAYMENT FOR THE BONDS - Special Tax Analysis." In December 2021, a seventh improvement area was designated within the District and change proceedings were conducted for Improvement Area No. 3.

Property Ownership and Development Status
The development planned within the Improvement Area is comprised of eight sequentially numbered "Villages" and three additional lots referred to as "Village 1 O," "Lot C" and "Lot D." Development within the Improvement Area is planned to ultimately include 441 single-family high density units, 222 multi-family low density units and 265 multi-family high density units, for an aggregate total of 928 residential units. Both the single-family high density units and the multi-family low density units, representing 663 total residences, are being developed as detached single-family homes. The 265 multi-family high density units are expected to be constructed as for-rent apartments.

See "PROPOSED PROPERTY DEVELOPMENT- Development Entitlements- Tentative and Final Mapping" for a discussion of these zoning entitlements within the Improvement Area. At full 3

04/12/2022 Item No.13.
development, the Improvement Area is also planned to include an elementary school, a police substation, a fire station, parks, trails and additional acreage planned for open space.

Property within the Improvement Area is in varying stages of development and is in the process of being completed in three main phases (referred to herein as "Phase 2A," "Phase 2B" and "Phase 2C").

Phase 2A of development within the Improvement Area includes Villages 4, 7, 8 and 10 and Lots C and D and is entitled for a total of 560 units at the time of full build-out, comprised of 73 single-family high density units, 222 multi-family low density units and 265 multi-family high density units. Phase 2B of development includes Villages 1 and 2 and is entitled for a total of 162 single-family high density units at the time of full build-out. Phase 2C of development includes Villages 3, 5 and 6 and is entitled for a total of 206 single-family high density units at the time of full build-out. "PROPOSED PROPERTY DEVELOPMENT- Development Entitlements- Tentative and Final Mapping." The majority of the property within the Improvement Area is owned by various merchant builders, including KB HOME Sacramento Inc., a California corporation ("KB HOME Sacramento"), Tri Pointe Homes Holdings, Inc., a Delaware corporation ("Tri Pointe"), Lennar Homes of California, LLC ("Lennar"), Beazer Homes Holdings, LLC ("Beazer") and FR 68 Lots LLC ("FR 68 Lots"). FR 68 Lots is managed by Signature Homes, Inc., a California corporation, and is owned by three separate members, each of which is affiliated with a member of the executive team of Signature Homes, Inc. Due to their affiliation, FR 68 Lots and Signature Homes, Inc. are each referred to herein as "Signature Homes." KB HOME Sacramento, Tri Pointe, Lennar, Beazer and Signature Homes are referred to herein collectively as the "Merchant Builders."
East Carpenter Improvement Company, LLC ("ECIC") and CMB Improvement Company, LLC ("CMB"), the master developers responsible for the initial improvement of the lots, also own portions of the taxable property within the Improvement Area. Both ECIC and CMB are managed by the same three individuals. As of March 8, 2022, 76 homes were owned by individual homeowners. See "PROPOSED PROPERTY DEVELOPMENT- Property Ownership." ECIC and CMB are under contract to sell the remaining portion of their taxable parcels to A.G. Spanos Company ("Spanos") and Tri Pointe, respectively.

ECIC and CMB have made significant progress in the initial grading and improvement of the taxable properties in the Improvement Area. ECIC completed the mass grading and backbone infrastructure for Phase 2A (consisting of Villages 4, 7, 8 and 10 and Lots C and D) in 2020 along with the development of the initial subdivisions for the 295 single-family residential lots and the 10-acre multifamily site (Lots C and D) planned for 265 multi-family high density units. CMB commenced development of Phase 28 (Villages 1 and 2) in October 2020 with grading and backbone roadway improvements for Westwood Drive and Savannah Parkway. The Phase 2B subdivision improvements commenced in April 2021 and were significantly completed in December 2021, and the landscaping, fencing and punch-list related work is underway and scheduled for completion in April 2022. ECIC's initial grading and improvement work for Phase 2C (Villages 3, 5 and 6) is scheduled to occur in two phases. The grading and backbone work for Village 3 began in February 2022 and is expected to be completed by the fourth quarter of 2022. The grading and backbone work for Villages 5 and 6 is expected to begin in April 2022 and is expected to be completed by the fourth quarter of 2022.

To date, final maps have been approved and recorded for Villages 1, 2, 4, 7, 8 and 10, and tentative maps have been approved for Villages 3, 5 and 6. Final maps for Villages 3, 5 and 6 are expected to be approved and recorded by June 30, 2022. A final small lot map is not required for the development of the 265 multi-family high density units on Lots C and D. However, a boundary line adjustment to remove the existing parcel line between Lots C and D will be required to be reviewed and approved by the City and recorded with the Office of the County Recorder of the County of Sacramento 4

04/12/2022 Item No.13.
prior to building permit issuance for Lots C and D. It is anticipated that the required boundary line adjustment for Lots C and D will be completed by Spanos during the second quarter of 2022.

The following table summarizes the current landowners, the current or anticipated merchant builders, the phase for development (2A, 2B or 2C), the status of the final maps and the number of units expected at full build-out.

Development Total
Property Current Owner Builder Phase Map Status Units
Village 1 CMB/Tri Pointe'U Tri Pointe 2B final small lot 88 Village 2 CMB/Tri Pointe'!' Tri Pointe 2B final small lot 74 Village 3 Beazer Beazer 2C tentative small lot 53
Village 4 KB HOME Sacramento KB HOME Sacramento 2A final small lot 73 Village 5 KB HOME Sacramento KB HOME Sacramento 2C tentative small lot 83 Village 6 KB HOME Sacramento KB HOME Sacramento 2C tentative small lot 70 Village 7 FR 68 Lots Signature Homes 2A final small lot 68 Village 8 KB HOME Sacramento KB HOME Sacramento 2A final small lot 36 Village 10 Lennar Lennar 2A final small lot 118
Lots C and D ECIC<2l Spanos 2A no final map required 265(2) (I) Tri Pointe has contracted to purchase the Village 1 and Village 2 properties through three separate takedowns, the first of which occurred in January 2022 for 54 lots. No assurance can be given that the conveyance of the remaining two takedowns totaling 108 lots will occur as expected. See "PROPOSED PROPERTY DEVELOPMENT- Property Ownership- Tri Pointe Purchase and Sale Agreement."
<2l Spanos has contracted to purchase the Lot C and Lot D properties. See "PROPOSED PROPERTY DEVELOPMENT Development Entitlements- Tentative and Final Mapping." Source: ECIC.

The following table summarizes, as of March 8, 2022, the current or anticipated merchant builders; the phase for development (2A, 2B or 2C); the zoning designation (single-family high density "SFHD," multi-family low density "MLD" or multi-family high density "MHD") for the lots; the number of homes under construction; the number of completed homes not yet sold; the number of homes under contract to be sold to individual home buyers; the number of homes closed; the number of building permits issued; the number of finished lots (without vertical home construction); the number of partially improved lots (including those that have only been initially graded for further development); the number of undeveloped lots; and the number of units expected at full build-out. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
5

04/12/2022 Item No.13.

Finished Lots
Homes (Without
Homes Completed Homes Building Vertical Partially Total Development Under But Not Under Homes Permits Home Improved Undeveloped Proposed Property Merchant Builder Phase Zoning Construction Closed Contract Closed Issued Construction) Lots Lots Units<3) - - -
Village I Tri Pointe'!' 28 SFHD 12<4) 0 0 0 12 76 0 0 88 Village 2 Tri Pointe'!' 28 SFHD 16(5) 0 0 0 16 58 0 0 74 Village 3 Beazer 2C SFHD 0 0 0 0 0 0 53 0 53
Village 4 KB HOME Sacramento 2A SFHD 50 2<6) 50 19 71 2 0 0 73 Village 5 KB HOME Sacramento 2C SFHD 0 0 0 0 0 0 83 0 83 Village 6 KB HOME Sacramento 2C SFHD 0 0 0 0 0 0 70 0 70 Village 7 Signature Homes 2A MLD 31 3(6) 21 31 65 3 0 0 68 Village 8 KB HOME Sacramento 2A SFHD 4 0 4 0 34 32 0 0 36 Village 10 Lennar 2A SFHD 40 4(6) 63 26 70 48 0 0 118
Lots C and D Spanosw 2A MHD Q Q Q Q Q Q 265 Q 265
TOTAL 153 9 138 76 268 219 471 0 928
(I) Tri Pointe has contracted to purchase the Village 1 and Village 2 properties through three separate takedowns, the first of which occurred in January 2022 for 54 lots. No assurance can be given that the conveyance of the remaining two takedowns totaling 108 lots will occur as expected. See "PROPOSED PROPERTY DEVELOPMENT- Property Ownership- Tri Pointe Purchase and Sale Agreement."
<2> Spanos has contracted to purchase the Lot C and Lot D properties. See "PROPOSED PROPERTY DEVELOPMENT- Development Entitlements- Tentative and Final Mapping." <3) Amounts equal to the total from the following columns: (i) "Homes Under Construction," (ii) "Homes Completed But Not Closed," (iii) "Homes Closed," (iv) "Finished Lots (Without Vertical Home Construction)," (v) "Partially Improved Lots" and (vi) "Undeveloped Lots." C4) Includes 12 Lonestar production homes. The two Lonestar model homes are being constructed in Village 2, where the Eastwood homes are being constructed.

CS) Includes four model homes (two for the Eastwood product and two for the Lonestar product) and 12 Eastwood production homes.

C6) Represents model homes.

Source: ECIC and the Merchant Builders
6

04/12/2022 Item No.13.

Property Values
An appraisal of the taxable property within the Improvement Area dated March 11, 2022 (the "Appraisal") was prepared by Integra Realty Resources, Sacramento, California (the "Appraiser"). The purpose of the appraisal was to estimate the aggregate value of the fee simple interest, subject to the special tax and based upon a hypothetical condition, for all of the taxable property within the Improvement Area. Subject to the assumptions, extraordinary assumption, hypothetical condition and limiting conditions contained in the Appraisal, the Appraiser estimated that the taxable property within the Improvement Area had an estimated aggregate value of $183,319,655 as of February 18, 2022. See "THE IMPROVEMENT AREA- Property Values."
Bondholders Risks
Investment in the Bonds involves a substantial degree of risk that may not be appropriate for some investors. For a discussion of certain considerations relevant to an investment in the Bonds, in addition to the other matters set forth herein, see "CERTAIN RISKS TO BONDHOLDERS." Investors should read the entire Official Statement to obtain information essential to the making of an informed investment decision.

Continuing Disclosure
The District will agree to provide certain annual financial information and operating data by not later than April 1 in each year, commencing April 1, 2023 (the "Annual Report"), and to provide notices of the occurrence of certain enumerated events. The Annual Report and notices will be filed with the Municipal Securities Rulemaking Board's Electronic Municipal Market Access database ("EMMA").

The specific nature of the information to be contained in the Annual Report or the notices of enumerated events is set forth in APPENDIX D- "FORMS OF CONTINUING DISCLOSURE UNDERTAKINGS." These covenants have been made in order to assist the Underwriter in complying with S.E.C. Rule 15c2-12.

KB HOME Sacramento and Tri Pointe will covenant for the benefit of the Bondholders to provide certain information relating to it, its development plan and its financing plan no later than March 31 and September 30 in each year, commencing September 30, 2022 (collectively, the "Disclosure Reports"), and to provide notices of the occurrence of certain enumerated events. The Disclosure Reports and notices will be filed with EMMA. The specific nature of the information to be contained in the Disclosure Reports or the notices of enumerated events is set forth in APPENDIX D- "FORMS OF CONTINUING DISCLOSURE UNDERTAKINGS." The obligations of KB HOME Sacramento and Tri Pointe will terminate upon the occurrence of certain events as set forth in the applicable Continuing Disclosure Certificate for KB HOME Sacramento and Tri Pointe, including when the property owned by KB HOME Sacramento and Tri Pointe within the Improvement Area, respectively, is no longer obligated to pay 20% or more of the Special Taxes within the Improvement Area.

Summaries Not Definitive
Brief descriptions of the Bonds; the Local Obligations; the security for the Bonds, the City, the Improvement Area and the status of development within the Improvement Area are included in this Official Statement together with summaries of certain provisions of the Bonds, the Trust Agreement and the Local Obligations Indenture. Such descriptions do not purport to be comprehensive or definitive. All references herein to the Trust Agreement and the Local Obligations Indenture are qualified in their entirety by reference to such documents, copies of which are available for inspection at the office of Trustee.
7

04/12/2022 Item No.13.

FOLSOM PLAN AREA
General Folsom Plan Area Plan of Finance
In 2001, the City commenced plans to expand its sphere of influence area to include an area south of US Route 50. The area, known as the Folsom Plan Area is bordered to the west by Prairie City Road, the east by the Sacramento/El Dorado County boundary line, the north by US Route 50, and the south by White Rock Road. In November 2004, the citizens of the City adopted Measure W ("Measure W"), which specified certain requirements for annexing the Folsom Plan Area into the City. In June 2011, the City adopted its Folsom Plan Area Specific Plan (the "Specific Plan"). The Local Agency Formation Commission approved the City's plan to annex the Folsom Plan Area on January 18, 2012.

As described below, the Folsom Plan Area is an area of approximately 3,500 acres in the southern portion of the City that has been approved for development of approximately 11,461 units of residential development, plus 274.5 acres of commercial/industrial development (including mixed use development).

Over the build out of the property, the City anticipates using community facilities districts under the Mello-Roos Act to finance a large portion of the public infrastructure required for the development, plus certain maintenance obligations of public improvements and facilities.

The City has previously issued a series of bonds for its Community Facilities District No. 17 (Willow Hill Pipeline) ("CFD 17") to finance certain public capital improvements for the benefit of the Folsom Plan Area in the principal amount of $6,675,000, of which $6,015,000 are currently outstanding.

The City has also formed its Community Facilities District No. 18 (Folsom Plan Area - Area-Wide Improvements and Services) ("CFD 18") to finance certain water and sewer improvements and a regional aquatic center along with maintenance and certain services. CFD 18 encompasses all of the property within the Folsom Plan Area, which is the CFD 17 property plus approximately 190 acres bordering El Dorado County in the eastern portion of the City south of US Route 50. The City has authorized the issuance of up to $200,000,000 in bonds for CFD 18. The timing of issuance of bonds for CFD 18 is dependent upon market conditions and development within the Folsom Plan Area, and the City currently anticipates that an initial series of CFD 18 bonds will be issued in the second half of 2022 to help finance the required Phase 2 Water Facilities (as defined herein). See "PROPOSED PROPERTY DEVELOPMENT- Development Entitlements- Water Supply Infrastructure." The boundaries of CFD 17 and CFD 18 encompass nearly all of the property in the Folsom Plan Area, including the property in the Improvement Area. The Improvement Area represents approximately 6.1 % by acres of CFD 17 and approximately 5.9% by acres of CFD 18. The allocable portion of bonds previously issued for CFD 17 and any bonds to be issued for CFD 18 constitute overlapping debt. See "THE IMPROVEMENT AREA- Overlapping Debt."
Public Facilities Financing Plan
Measure W, adopted by City of Folsom residents in November 2004, required, among other things, that residents north of US Route 50 not bear the cost for infrastructure and public facilities serving the Folsom Plan Area. The City adopted a Public Facilities Financing Plan ("PFFP") for the Folsom Plan Area on January 14, 2014. The PFFP provides an overview of how the infrastructure required for the development of the Folsom Plan Area will be financed and constructed and how various public facilities will be financed and maintained to ensure that public facilities and infrastructure will be available for the orderly development of the Folsom Plan Area without cost to the residents of the City north of US Route 50 and without an adverse impact on the service levels provided to future residents of the Folsom Plan Area.
8

04/12/2022 Item No.13.

The PFFP contemplates that the primary sources of funding for the construction of the public infrastructure and facilities in the Folsom Plan Area are community facilities districts, development impact fees collected upon permit issuance (including development impact fees of the Folsom Cordova Unified School District), direct developer financing, and matching state school grants and other school funding (including the school facilities improvement district described under "THE IMPROVEMENT AREA- Overlapping Debt"). Subdivision improvements are not included as part of the PFFP.

On September 8, 2015, the City approved Resolution No. 9641, in which the City Council adopted a Nexus Study to collect certain impact fees for the Specific Plan to be collected in accordance with City Ordinance No. 1234. In addition, on the same date, the City approved Resolution No. 9642, in which the City Council adopted a Nexus Study for the Specific Plan Infrastructure Fees (the "SPIF") to be collected for the Specific Plan and in accordance with Ordinance No. 1235 and Chapter 3.130 of the Folsom Municipal Code. Most recently, on January 9, 2018, the City of Folsom approved Resolution No. 10040, amending Resolution No. 9641, to adjust the initial Folsom Plan Area Development Impact Fees.

On the same date, the City approved Resolution No. 10059, adopting the Nexus Study Fiscal Year 2017- 18 Update for the SPIF, and setting the updated infrastructure fees. On July 28, 2020, the City approved Resolution No. 10491, in which the City adopted the Nexus Study Fiscal Year 2020-21 Update for the Folsom Plan Area SPIF. On this date, the City also introduced and had the first reading for City Ordinance No. 1307, in which the City amended sections 3.130.0l0(JJ) and 3.130.030(E)(l )(c) of the Folsom Municipal Code pertaining to the SPIF Set-Aside Component of the SPIF. The SPIF Set-Aside was amended to include a new SPIF Off-Site Water Set-Aside Component to repay the City for water treatment plant costs the City had previously incurred. On August 25, 2020, the City conducted the second reading and approved Ordinance No. 1307.

Phasing of Development. For purposes of setting the PFFP costs, the City projected single family units would be sold and occupied within 13 years, multi-family low density units within 15 years, and multi-family medium and high density units within 18 years.

Backbone Infrastructure. The PFFP provides for the financing or collection of impact fees for and the construction of the backbone infrastructure required before construction in the Folsom Plan Area can proceed. Specifically, the PFFP recognizes the need for roadway improvements, on-site water system improvements, off-site water system improvements, recycled water system improvements, sanitary sewer system improvements, storm drainage system improvements, habitat mitigation, and construction of two freeway interchanges and improvements to an existing freeway interchange.

Public Facilities - the Folsom Plan Area. The PFFP describes plans for the financing of public schools, parks, transit services, trails, police and fire facilities and equipment, municipal service center, a corporation yard, solid waste facilities, a library, general capital improvements, transportation, and a community and aquatic center. The PFFP anticipates that the land for the public facilities will be dedicated to the City without cost to the City.

The Folsom Plan Area is currently being served by the existing fire resources of the City as well as other Sacramento County, El Dorado County and Placer County fire agencies through mutual aid agreements with the City. The City is currently undertaking general planning for the type and staffing needs of the first fire station. As noted in the PFFP, the City's goal is to maintain a level of service that represents a rate of 1 station per 12,000 population, which the City expects to resolve by commencing construction on the first fire station servicing the Folsom Plan Area when there are approximately 1,400 residential units occupied within the Folsom Plan Area.

The estimated total cost of the backbone infrastructure and public facilities for the Folsom Plan Area at build-out is $876,669,484 (in 2017 dollars), of which the City anticipates that a portion will be 9

04/12/2022 Item No.13.
financed through the Folsom Plan Area SPIF and the issuance of bonds for CFD 18, the Improvement Area or other community facilities districts and improvement areas. This estimate is subject to a variety of construction and market risks. The City and the District can provide no assurances that the overall costs will not increase, even significantly, in the future. The following table shows the breakdown of overall estimated costs for each category of improvement within the Folsom Plan Area as a whole.

Table 1
City of Folsom
Folsom Plan Area Public Facilities Financing Plan
Estimated Budget (2017$)
Infrastructure Public Improvements
Roadways
Dry Utility
On-Site Water
Off-Site Potable Water
Recycled Water
Wastewater (Sewer)
Storm Drainage
Habitat Mitigation
Total:

Estimated Cost
$270,335,001
32,476,778
54,966,951
41,655,691
10,931,440
21,434,147
65,467,614
6,978,281
$504,245,902
Public Schools(ll(2l
Parks
Transit Services
Housing Trust'"
Trails
Fire Facilities and Equipment
Police Facilities and Equipment
Municipal Service Center
Corporation Yard
Solid Waste
Branch Library
Community and Aquatic Centert"
General Capital
Transportation'v
Total:

Estimated Cost
$134,250,000
74,116,000
17,129,000
39,680,000
14,420,000
12,736,582
5,843,000
5,434,000
8,020,000
5,542,000
2,833,000
37,860,000
13,800,000
760,000
$372,423,582
Source: Folsom Specific Plan Infrastructure Fee Nexus Study Fiscal Year 2017-2018 Update ("Nexus Study Update"); City of Folsom; EPS.
<1l Assumed no active-adult units in calculation of estimated school fee revenue. Certain developments within the Folsom Plan Area are expected to include active-adult units.
<2l Based on estimated fee revenue generated from existing fee programs. <3) Community and Aquatic Center was not included in the Nexus Study Update. Estimated cost based on original PFFP costs in 2013 dollars increased by 3.02%, similar to the cost increases for the Folsom Plan Area Specific Plan Stand Alone Fee facilities included in the Nexus Study Update.

Development within the Folsom Plan Area, including within the Improvement Area, is dependent upon completion of certain of the above described infrastructure. For more information on status of construction of improvements and development necessary for development to occur within the Improvement Area, see "PROPOSED PROPERTY DEVELOPMENT." See also "THE IMPROVEMENT AREA- Overlapping Debt."

PLAN OF FINANCE
Facilities to be Financed
The Bonds are issued for the purpose of providing funds to purchase the Local Obligations. The Local Obligations are being issued to finance the acquisition and construction of certain public capital improvements more particularly described in the Resolution of Formation adopted by the City Council of the City on May 26, 2020. The City entered into an acquisition and shortfall agreement (the "Acquisition Agreement") with ECIC on June 25, 2020, wherein the City agrees to use a portion of the proceeds of the Local Obligations to finance the acquisition from ECIC of those facilities set forth in the Acquisition Agreement. Such facilities consist of certain transportation improvements, water system improvements, 10

04/12/2022 Item No.13.
recycled water system improvements, drainage system improvements, wastewater system improvements, park, parkway and open space improvements, Specific Plan Infrastructure Fee program improvements and certain Specific Plan Infrastructure Fee obligations (collectively, the "Facilities"). Construction of the Facilities is required for development within the Improvement Area and the District to be completed.

Proceeds from the Local Obligations are expected to finance some, but not all, of the Facilities eligible to be financed within the District, and the District expects to issue one or more series of bonds to finance the acquisition of additional facilities in the future. See "PROPOSED PROPERTY DEVELOPMENT - Development Plans of Finance."

THE BONDS
General
The Bonds are secured by a pledge of amounts paid with respect to the Local Obligations. The Local Obligations are secured by a pledge of Special Taxes (net of Priority Administrative Expenses) levied against taxable property within the Improvement Area. See "DEBT SERVICE SCHEDULE" and "SECURITY AND SOURCES OF PAYMENT FOR THE BONDS." The Local Obligations are secured by a pledge of Special Taxes (net of Priority Administrative Expenses) on parity with the City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 1 Special Tax Bonds, Series 2020 (the "2020 IAl Obligations") and any Additional Local Obligations (defined below).

The Local Obligations Indenture establishes a Local Obligation Reserve Fund and a Local Obligations Reserve Account therein with respect to the Local Obligations. Amounts available from the Local Obligations Reserve Account are available to pay debt service on the Local Obligations. The Local Obligations Indenture requires the funding of separate debt service reserve accounts for the Local Obligations, the 2020 IAl Obligations and any Additional Local Obligations, each of which may be used only to pay the principal of and interest on the related series of special tax bonds issued under the Local Obligations Indenture. There is no reserve fund with respect to the Bonds. Amounts available from the Local Obligations Reserve Account are not available to cure a deficiency generally in the Trust Estate to make debt service payments on the Bonds.

Description of the Bonds
General. The Bonds will be dated their date of delivery and mature on September 1, as set forth on the inside front cover page hereof (each, a "Principal Payment Date"). Interest is payable semiannually on March 1 and September 1 of each year, commencing September 1, 2022 (each, an "Interest Payment Date").

The Bonds will be issued as fully registered bonds, without coupons, in denominations of $5,000, or any integral multiple thereof. The Bonds will be issued in book-entry only form and will be registered in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York ("OTC"). OTC will act as securities depository for the Bonds. So long as the Bonds are in book-entry only form, principal of and redemption premium, if any, on the Bonds will be payable to OTC or its nominee, who will in turn remit such payments to OTC Participants for subsequent disbursement to the Beneficial Owners. See APPENDIX F- "DTC AND THE BOOK-ENTRY ONLY SYSTEM." Principal of, and redemption premium, if any, on the Bonds is payable at the corporate trust office of the Trustee. Interest on the Bonds will be paid only to the registered owners as shown on the Trustee's books as of the fifteenth day of the calendar month next preceding each Interest Payment Date (the "Record Date"), except that in the case of an owner of $1,000,000 or more in aggregate principal amount 11

04/12/2022 Item No.13.
of Bonds outstanding, payment will be made at the owner's option by wire transfer of immediately available funds to an account in a bank or trust company or savings bank that is a member of the Federal Reserve System and that is located in the continental United States of America according to instructions provided by such owner to the Trustee and received no later than the Record Date for such Interest Payment Date.

The Bonds are special, limited obligations of the Authority. The Bonds are payable solely from and secured by the Trust Estate of the Authority pledged under the Trust Agreement, consisting primarily of payments received by the Authority from the District under the Local Obligations, which payments are secured by a lien of the Special Taxes (defined herein) (net of Priority Administrative Expenses) levied upon property within the Improvement Area, as more fully described herein. See "SECURITY AND SOURCES OF PAYMENT FOR THE BONDS."
Payments under the Local Obligations are calculated to be sufficient to permit the Authority to pay the principal of, and interest on, the Bonds when due. Pursuant to the Local Obligations Indenture, a Local Obligations Reserve Account is established for the Local Obligations. Amounts available from the Local Obligations Reserve Account are not available to cure a deficiency in the Trust Estate available to pay debt service of the Bonds. See "SECURITY AND SOURCES OF PAYMENT FOR THE BONDS­ Terms of the Local Obligations- Local Obligations Reserve Account." No Additional Bonds under the Trust Agreement. The Trust Agreement does not permit the Authority to issue any additional bonds on parity with the Bonds. However, subject to certain conditions contained in the Local Obligations Indenture, the District may at any time issue bonds (the "Additional Local Obligations") payable from the net proceeds of the Special Tax (after payment of Priority Administrative Expenses) on parity with the Local Obligations and the 2020 IAI Obligations. See "SECURITY AND SOURCES OF PAYMENT FOR THE BONDS - Terms of the Local Obligations - Additional Local Obligations."
Redemption Provisions·
Optional Redemption. The Bonds are subject to optional redemption by the Authority prior to their respective maturity dates as a whole or in part on any date on or after , 20 _ , from any source of available funds other than Minimum Sinking Fund Payments and Special Tax Prepayments, at the following redemption prices (computed upon the principal amount of the Bonds or portions thereof called for redemption) together with accrued interest thereon to the date fixed for redemption:
103% if redeemed on any date on or after , 20_ through
_ _ _ _ ,20_ ,
I 02% if redeemed on any date from
_ _ _ ,20
IO I% if redeemed on any date from
_ _ _ _ ,20_ ;and
20 through
20 through
100% if redeemed on , 20_ and any date thereafter.

Extraordinary Redemption from Prepayment of Special Taxes. The Bonds are subject to extraordinary redemption by the Authority prior to their respective maturity dates, as a whole or in part on • Preliminary, subject to change.
12

04/12/2022 Item No.13.
any Interest Payment Date on or after , 20 _ , solely from funds derived from the extraordinary redemption of Local Obligations from Special Tax Prepayments, at the following redemption prices (computed upon the principal amount of the Bonds or portions thereof called for redemption) together with accrued interest thereon to the date fixed for redemption:
103% if redeemed on an Interest Payment Date on or after - - - - 20_ through , 20_
102% if redeemed on an Interest Payment Date on , 20 and _ _ _ ,20_
101 % if redeemed on an Interest Payment Date on , 20 _ and , 20_ ; and - - - -
100% if redeemed on , 20 _ and any Interest Payment Date thereafter.

Prepayments from prepaid Special Taxes could be made by any of the owners of any of the property within the Improvement Area, including ECIC, CMB, any of the Merchant Builders, any other developers or homebuilders owning Taxable Property in the Improvement Area or any individual owner; and they could also be made from the proceeds of bonds issued by or on behalf of an overlapping special assessment district or community facilities district. The resulting redemption of Bonds that were purchased at a price greater than the applicable redemption price could reduce the otherwise expected yield on such Bonds. See "CERTAIN RISKS TO BONDHOLDERS- Potential Early Redemption of Bonds from Prepaid Special Taxes."
Mandatory Sinking Fund Redemption of Bonds. The Bonds maturing on September 1, 20 _ are subject to mandatory redemption in part on September 1 of each year commencing September 1, 20_ , at a redemption price equal to one hundred percent (100%) of the principal amount thereof called for redemption together with accrued interest thereon to the date fixed for redemption:

Minimum Sinking Fund
Payment Date
(September 1)
Bonds
Minimum Sinking Fund Payment
$
t Maturity.
13

04/12/2022 Item No.13.

The Bonds maturing on September 1, 20_ are subject to mandatory redemption in part on September 1 of each year commencing September 1, 20 _ , at a redemption price equal to one hundred percent (100%) of the principal amount thereof called for redemption together with accrued interest thereon to the date fixed for redemption:

Minimum Sinking Fund
Payment Date
(September 1)
Bonds
Minimum Sinking Fund Payment
$
t Maturity.

If the Bonds subject to mandatory redemption are redeemed in part prior to their stated maturity date other than from Minimum Sinking Fund Payments, the Minimum Sinking Fund Payments for such Bonds shall be reduced proportionately by the principal amount of such Bonds so redeemed.

Redemption Instructions. Upon any prepayment of a Local Obligation, the Authority shall deliver to the Trustee a Written Order of the Authority designating the amounts and maturities of the Bonds to be redeemed, which shall be in the manner necessary to enable the Authority to deliver a Cash Flow Certificate satisfying the requirements described below. In the event only a portion of the Outstanding Bonds of any maturity are to be redeemed at any one time, the Trustee shall select the particular Bonds of each maturity date to be redeemed in accordance with OTC procedures or, if the Bonds are not then in book-entry, in a manner that it deems appropriate and fair. The Trustee shall redeem Bonds in Authorized Denominations.

Upon any redemption of a portion but not all of the Outstanding Bonds, the Authority shall deliver to the Trustee a Cash Flow Certificate to the effect that, assuming all payments are made with respect to the Local Obligations, (i) the Revenues, together with moneys on deposit in other funds and accounts held under the Trust Agreement, will be sufficient to pay all Principal Installments, Minimum Sinking Fund Payments and interest payments on the Bonds when due; and (ii) the redemption premiums, if any, on the Local Obligations, together with other Revenues available to the Trustee for such purpose, are sufficient to offset any difference between the interest to accrue on the Bonds to be paid or redeemed with the proceeds of prepayment of such Local Obligations (plus any redemption premium payable upon redemption of such Bonds) and the income to be earned on any investment of such proceeds (assured as of the date of payment thereof), in each case until the date of payment or redemption of Bonds, such that in no event will the prepayment of Local Obligations cause the Trustee to have insufficient funds to pay debt service on the Bonds when due.

In no event shall Bonds be redeemed if upon such redemption the principal amount of the Local Obligations remaining outstanding will be less than the total principal amount of Outstanding Bonds.

Such Written Order of the Authority may specify that optional redemption of the Bonds will be conditioned upon receipt of funds or other events.

Notice of Redemption. Subject to receipt of the Written Order of the Authority described under "- Redemption Instructions", the Trustee shall give notice of redemption; provided, that Bonds, identified by CUSIP numbers, serial numbers and maturity date, have been called for redemption and, in the case of Bonds to be redeemed in part only, the portion of the principal amount thereof that has been 14

04/12/2022 Item No.13.
called for redemption (or if all the Outstanding Bonds are to be redeemed, so stating, in which event such serial numbers may be omitted), that they will be due and payable on the date fixed for redemption (specifying such date) upon surrender thereof to the Trustee at its Corporate Trust Office, subject to any conditions to such redemption specified in the Written Order of the Authority, at the redemption price (specifying such price), together with any accrued interest to such date, and that all interest on the Bonds ( or portions thereof) so to be redeemed will cease to accrue on and after such date and that from and after such date such Bond (or such portion thereof) shall no longer be entitled to any lien, benefit or security under the Trust Agreement, and the Owner thereof shall have no rights in respect of such redeemed Bond or such portion except to receive payment from such money of such redemption price plus accrued interest to the date fixed for redemption. If sufficient monies for the payment of the redemption price of all Bonds to be redeemed are not then on deposit with the Trustee, such notice shall also state that redemption is conditioned upon the timely deposit of sufficient funds therefor with the Trustee.

Such notice shall be mailed by first class mail, in a sealed envelope, postage prepaid, at least thirty (30) but not more than sixty (60) days before the date fixed for redemption, to the Owners of such Bonds (or portions thereof) so called for redemption, at their respective addresses as the same shall last appear on the Bond Register; provided, that neither the failure of an Owner to receive notice of redemption of Bonds nor any error in such notice shall affect the validity of the proceedings for the redemption of Bonds.

Any notice of optional redemption may be rescinded by written notice given by the Authority to the Trustee no later than three Business Days prior to the date specified for redemption. The Trustee shall give notice of rescission of the notice of optional redemption or non-satisfaction of any conditions specified in the notice of optional redemption as soon as practicable to the same parties and in the same manner as the notice of redemption was given.

So long as the Bonds are in book-entry only form, notices of redemption will be given directly by the Trustee to DTC and not to the Beneficial Owners of the Bonds. See APPENDIX F- "DTC AND THE BOOK-ENTRY ONLY SYSTEM."
Purchase in Lieu of Redemption. In lieu of redemption of any Bond, amounts on deposit in the Proceeds Fund, the Principal Fund or in the Redemption Fund may be used and withdrawn by the Trustee at any time prior to a notice of redemption having been delivered, upon a Written Order for the purchase of such Bonds at public or private sale as and when and at such prices as the Authority may in its discretion determine, but not in excess of the lower of the highest or then current redemption price thereof plus accrued interest to the purchase date; and all Bonds so purchased shall be delivered to the Trustee for cancellation.

Payment of Redeemed Bonds. If notice of redemption has been given and not rescinded and if the conditions to such redemption specified therein, if any, have been satisfied, each as provided in the Trust Agreement, the Bonds or portions thereof called for redemption will become irrevocably due and payable on the date fixed for redemption at the redemption price thereof, together with accrued interest to the date fixed for redemption, upon presentation and surrender of the Bonds to be redeemed at the office specified in the notice of redemption. If less than the full principal amount of a Bond is called for redemption, the Authority is required to execute and deliver and the Trustee is required to authenticate, upon surrender of such Bond, and without charge to the Owner thereof, Bonds of like interest rate and maturity in an aggregate principal amount equal to the unredeemed portion of the principal amount of the Bonds so surrendered in such Authorized Denominations as specified by the Owner.

If any Bond or any portion thereof has been duly called for redemption and payment of the redemption price, together with unpaid interest accrued to the date fixed for redemption, has been made or 15

04/12/2022 Item No.13.
provided for by the Authority, then interest on such Bond or such portion will cease to accrue from such date, and from and after such date such Bond or such portion will no longer be entitled to any lien, benefit or security under the Trust Agreement, and the Owner thereof will have no rights in respect of such Bond or such portion except to receive payment of such redemption price, and unpaid interest accrued to the date fixed for redemption.

ESTIMATED SOURCES AND USES OF FUNDS
The proceeds from the sale of the Bonds will be used to purchase the Local Obligations. The proceeds of the Local Obligations in turn will be used to finance construction and acquisition of the Facilities and pay costs of issuance of the Local Obligations and Bonds. The following table sets forth the estimated sources and uses of the funds as allocated to the Bonds:

Sources of Funds
Principal Amount
[Plus/Less]: [Net] Original Issue [Premium/Discount]
Total Sources
Uses of Funds
Acquisition and Construction Fund
Underwriter's Discount
Deposit to Local Obligations Reserve Account'"
Deposit to Local Obligations Capitalized Interest Accounts" Deposit to Costs of Issuance Fund<3l
Total Uses
$
$
$
$
(I) A portion of the purchase price of the Local Obligations will be deposited into the Local Obligations Reserve Account for the Local Obligations. See "SECURITY AND SOURCES OF PAYMENT FOR THE BONDS." <2) To pay interest on the Local Obligations and, in tum, the Bonds, to September I, 2022. (3) A portion of the purchase price of the Local Obligations will be used to pay costs of issuance including fees of Bond Counsel and the Municipal Advisor, the initial fees of the Trustee, noncontingent fees of the Appraiser, printing costs and other miscellaneous expenses.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
16

04/12/2022 Item No.13.

DEBT SERVICE SCHEDULE
The annual scheduled debt service schedule for both the Bonds and the 2020 IA 1 Obligations, assuming no early redemption other than from mandatory sinking fund installments, is set forth in Table 2A below. The Local Obligations are sized to provide 100% of the debt service on the Bonds when due and have the same principal amortization as the Bonds. The Local Obligations will be issued with an annual scheduled debt service schedule that, when combined with the scheduled debt service for the 2020 IA 1 Obligations, results in at least 110% annual debt service coverage from the revenues of the Effective Tax Rate Evaluation Maximum Facilities Special Tax (as defined herein) for Developed Property and the Effective Tax Rate Evaluation Minimum Facilities Revenues for Small Lot Final Map Property expected to be generated in the Improvement Area, except those revenues expected from Lots C and D, net of Priority Administrative Expenses (defined below). The District expects that Additional Local Obligations will be issued on parity with the Local Obligations and the 2020 IA! Obligations as the Improvement Area develops. See "SECURJTY AND SOURCES OF PAYMENT FOR THE BONDS - Terms of the Local Obligations =Additional Local Obligations."
Table 2A
Folsom Ranch Financing Authority
City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 1 Special Tax Revenue Bonds, Series 2022
Debt Service Schedule"
2020 JAi Total Series
Period Ending Obligations Series 2022 Series 2022 2022 Debt Total Debt (September I) Debt Service Principal Interest Service Service 2022<1) $615,050 $ $ $ $
2023 626,900
2024 643,300
2025 654,100
2026 669,450
2027 679,200
2028 696,600
2029 708,000
2030 723,600
2031 738,200
2032 751,800
2033 764,400
2034 781,000
2035 796,400
2036 815,600
2037 828,400
2038 845,000
2039 865,200
2040 878,800
2041 881,000
2042 882,200
2043 882,400
2044 881,600
2045 879,800
2046 882,000
2047 883,000
2048 882,800
2049 881,400
2050 878,800
2051
2052
TOTAL $22,896,00 $ $ $ $
Preliminary, subject to change
(I) Local Obligations debt service capitalized through September I, 2022.

Source: Piper Sandler & Co.
17

04/12/2022 Item No.13.

The following table shows the expected debt service coverage for the Bonds for Fiscal Year 2022-23, taking into account the debt service on both the Local Obligations and the 2020 IAI Obligations for that Fiscal Year, based on the revenues of the Effective Tax Rate Evaluation Maximum Facilities Special Tax (as defined herein) for all taxable properties in the Improvement Area other than Lots C and D, net of Priority Administrative Expenses in the amount of $20,400.

Table 2B
City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 1
Fiscal Year 2022-23
Debt Service and Debt Service Coverage - Local Obligations and 2020 IAl Obligations" Net
Effective
Tax Rate
Effective Evaluation
Tax Rate Maximum
Maximum Facilities 2020 IAI Local Total Improvement
Facilities Priority Special Obligations Obligations Improvement Area Debt Special Tax Administrative Tax Debt Debt Area Debt Service Fiscal Year Revenue<1H2> Expensev" Revenue Service Service . Service . Coverage . 2022-23 $1,410,822 $20,400 $1,390,422 $626,900 $624,550 $1,251,450 111.1% Preliminary, subject to change
(I) The Effective Tax Rate Evaluation Maximum Facilities Special Tax escalates annually at 2%. <2l Excludes the Effective Tax Rate Evaluation Maximum Facilities Special Tax revenues from Lots C and D. <3) The Priority Administrative Expense amount was established at $20,000 for Fiscal Year 2021-22 and escalates annually at 2%.

Source: Piper Sandler & Co. for Local Obligations debt service figures; Trustee for 2020 IA I Obligations debt service figures; NBS for all other amounts.

SECURITY AND SOURCES OF PAYMENT FOR THE BONDS
The Bonds are secured by a lien on and pledge of the Trust Estate, consisting primarily of payments received by the Authority from the District under the Local Obligations, which payments are secured by Special Taxes (net of Priority Administrative Expenses) levied upon property within the Improvement Area and received by the District.

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

DISTRICT, THE AUTHORITY, THE STATE OF CALIFORNIA OR ANY OTHER POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE BONDS. THE AUTHORITY HAS NO TAXING POWER. EXCEPT FOR THE TRUST ESTATE, NO OTHER REVENUES OR TAXES ARE PLEDGED TO THE PAYMENT OF THE BONDS. THE BONDS ARE NOT GENERAL

OBLIGATIONS OF THE AUTHORITY, THE DISTRICT OR CITY, BUT ARE LIMITED

OBLIGATIONS OF THE AUTHORITY PAYABLE SOLELY FROM THE TRUST ESTATE,

DERIVED PRIMARILY FROM PAYMENTS ON THE LOCAL OBLIGATIONS FROM THE

PAYMENT OF THE SPECIAL TAXES LEVIED WITHIN THE IMPROVEMENT AREA AS MORE FULLY DESCRIBED HEREIN.

The Trust Agreement does not permit the Authority to issue any additional bonds on parity with the Bonds. However, subject to certain conditions contained in the Local Obligations Indenture, the District may at any time issue Additional Local Obligations payable from the net proceeds of the Special Tax (after payment of Priority Administrative Expenses) on parity with the Local Obligations and the 18

04/12/2022 Item No.13.
2020 IAl Obligations. See "SECURITY AND SOURCES OF PAYMENT FOR THE BONDS - Terms of the Local Obi igations =Additional Local Obligations." General
The Trust Estate consists of the Revenues, the amounts in certain of the funds established and held under the Trust Agreement, and the Local Obligations. The Revenues consist of amounts received by the Trustee as the payment of interest on, or the equivalent thereof, and the payment or return of principal of, or redemption premiums, if any, on, or the equivalent thereof, the Local Obligations, whether as a result of scheduled payments, or redemption premiums, Special Tax Prepayments or remedial proceedings taken in the event of a default thereon, and all investment earnings on any money held in the Funds held under the Trust Agreement ( except the Rebate Fund).

The principal of and the interest on the Local Obligations are payable from the annual Special Taxes levied and to be collected on all real property within the Improvement Area subject to the Special Taxes and the proceeds, if any, from the sale of such property for delinquency of such Special Taxes, after payment of Priority Administrative Expenses. The Local Obligations are secured by a pledge on the Special Taxes (net of Priority Administrative Expenses) on parity with the pledge of such Special Taxes for the 2020 IAI Obligations and any Additional Local Obligations issued under the Local Obligations Indenture. See "- Payment of the Local Obligations" and "- Terms of the Local Obligations." The District may not issue indebtedness payable from the Special Taxes except as provided in the Local Obligations Indenture. See APPENDIX C- "SUMMARY OF PRINCIPAL DOCUMENTS­ SUMMARY OF THE LOCAL OBLIGATIONS INDENTURE- Authorization and Issuance ofBonds­ Additional Bonds; Subordinate Bonds." The City has, however, formed CFD 17, which has issued bonds secured by special taxes with a co-equal lien on property within the Improvement Area and has formed CFD 18, which is authorized to issue bonds secured by special taxes with a co-equal lien on property within the Improvement Area. See "FOLSOM PLAN AREA." The Authority, the District and the City have no control over the amount of additional debt payable from taxes or assessments on all or any portion of the property within the Improvement Area that may be issued in the future by other governmental entities or districts having jurisdiction over all or a portion of the land within the Improvement Area. To the extent such debt is payable from other assessments or special taxes levied pursuant to the applicable law, such assessments or special taxes may have a lien on the property within the Improvement Area on parity with the lien of the Special Taxes.

Flow of Funds
Receipt and Deposit of Revenues. As noted above, Revenues consist of amounts received by the Trustee as the payment of interest on, or the equivalent thereof, and the payment or return of principal of, or redemption premiums, if any, on, or the equivalent thereof, all Local Obligations, whether as a result of scheduled payments, or redemption premiums, Special Tax Prepayments or remedial proceedings taken in the event of a default thereon, and all investment earnings on any money held under the Trust Agreement ( except the Rebate Fund). All Revenues, other than Revenues derived from the early redemption of Local Obligations from Special Tax Prepayments received by the Trustee from the Authority, will be deposited into the Revenue Fund. On each Interest Payment Date and each Principal Payment Date, the Trustee will transfer Revenues from the Revenue Fund, in the amounts required in the order of priority as set forth below, with the requirements of each fund being fully satisfied, leaving no deficiencies therein, prior to any deposit into any fund later in priority:
19

04/12/2022 Item No.13.

First:

Second:

To the Interest Fund, an amount of Revenues which together with amounts on deposit therein, is equal to the interest due and payable on the Bonds due on such Interest Payment Date;
To the Principal Fund (i) on each Principal Payment Date from the Revenue Fund an amount of Revenues which, together with any amounts then on deposit in the Principal Fund ( other than amounts previously deposited on account of any Bonds which have matured but which have not been presented for payment) is sufficient to pay the Principal Installments on the Bonds due on such Principal Payment Date and (ii) on each September 1 on which a Minimum Sinking Fund Payment is required to be made (for deposit in the Sinking Fund Account) from the Revenue Fund an amount of Revenues which is equal to the Minimum Sinking Fund Payment due and payable on such date. On each Principal Payment Date, the Trustee shall pay the principal or redemption price due and payable on the Bonds on such date from the Principal Fund.

Following such deposits, any remaining money in the Revenue Fund is required to be transferred to the Local Obligations Trustee for application under the Local Obligations Indenture. For additional information regarding the Flow of Funds, see "- Local Obligations Flow of Funds." Revenues Derived from Special Tax Prepayments. All Revenues derived from early redemption of Local Obligations from Special Tax Prepayments received by the Trustee will be immediately deposited into the Redemption Fund to be applied to the extraordinary redemption of Bonds. See "THE BONDS- Redemption Provisions- Extraordinary Redemption from Prepayment of Special Taxes." Description of Local Obligations
The District will issue the Local Obligations in the principal amount of $13,235,000.* The Local Obligations are secured solely by the Special Taxes (net of Priority Administrative Expenses) levied upon certain real property within the Improvement Area and proceeds of foreclosure sales in the Improvement Area.

The pledge of Special Taxes (net of Priority Administrative Expenses) levied within the Improvement Area is on parity with the pledge thereof securing the 2020 IAl Obligations and any Additional Local Obligations issued under the Local Obligations Indenture. The District may issue Additional Local Obligations secured on parity with the pledge of the Special Taxes (net of Priority Administrative Expenses) within the Improvement Area only in accordance with the Local Obligations Indenture. See APPENDIX C- "SUMMARY OF PRINCIPAL DOCUMENTS- SUMMARY OF THE LOCAL OBLIGATIONS INDENTURE- Authorization and Issuance of Bonds- Additional Bonds; Subordinate Bonds."
A description of the Improvement Area is set forth under the caption, "THE IMPROVEMENT AREA."
Issuance of Local Obligations
The Local Obligations are authorized pursuant to the Mello-Roos Act and are issued under a resolution of the City Council of the City, as legislative body of the District and the Local Obligations Indenture. The Mello-Roos Act was enacted by the State Legislature to provide an alternate method of • Preliminary, subject to change.
20

04/12/2022 Item No.13.
financing certain essential public capital facilities and services, especially in developing areas of the State.

Subject to approval by a two-thirds vote of qualified electors and compliance with the provisions of the Mello-Roos Act, a legislative body of a local agency may issue bonds for a community facilities district and may levy and collect a special tax within such district to repay such indebtedness.

The Local Obligations constitute special tax obligations of the District payable as to both principal and interest from the annual Special Tax (after payment of the District's Priority Administrative Expenses) to be levied by the District on land within the Improvement Area, including proceeds from the sale of property within the Improvement Area collected as a result of foreclosure of the lien of the Special Taxes and certain funds and accounts held under the Local Obligations Indenture. The District's sole recourse in the event of a delinquency or failure to pay Special Taxes on a particular parcel is to institute foreclosure proceedings with respect to that parcel. However, the District is not obligated under the Local Obligations Indenture to enforce the lien of any delinquent installment of the Special Tax for any Fiscal Year in which the District has received one hundred percent (100%) of the amount of such installment from the County pursuant to the Teeter Plan. See "-C ovenant for Foreclosure" and "- The Teeter Plan" herein.

Payment of the Local Obligations
The Local Obligations constitute the limited obligations of the District payable as to both principal and interest from the annual Special Tax (net of Priority Administrative Expenses) levied by the District on Taxable Property within the Improvement Area, including proceeds from the sale of property within the Improvement Area collected as a result of foreclosure of the lien on the Special Taxes and certain funds and accounts held under the Local Obligations Indenture. The District's sole recourse in the event of a delinquency or failure to pay Special Taxes on a particular parcel is to institute foreclosure proceedings with respect to that parcel.

The term "Priority Administrative Expenses" means an amount equal to (a) for Fiscal Year 2021-22, $20,000, and (b) for any subsequent Fiscal Year, the amount resulting from increasing the Priority Administrative Expenses on each July 1, from and including the July 1 immediately following the end of the then current Fiscal Year to and including the July l in such Fiscal Year by 2% of the amount in effect for the previous Fiscal Year.
, THE LOCAL OBLIGATIONS ARE SPECIAL TAX OBLIGATIONS OF THE DISTRICT,

AND THE INTEREST ON AND PRINCIPAL OF AND REDEMPTION PREMIUMS, IF ANY, ON

THE LOCAL OBLIGATIONS ARE PAY ABLE SOLELY FROM THE PROCEEDS OF THE SPECIAL

TAX (INCLUDING ANY PREPAYMENTS THEREOF AND PROCEEDS FROM THE SALE OF

PROPERTY COLLECTED PURSUANT TO THE FORECLOSURE PROVISIONS OF THE LOCAL

OBLIGATIONS INDENTURE FOR THE DELINQUENCY OF THE SPECIAL TAX), NET OF

PRIORITY ADMINISTRATIVE EXPENSES, AND AMOUNTS IN CERTAIN FUNDS AND

ACCOUNTS ESTABLISHED IN THE LOCAL OBLIGATIONS INDENTURE, AND THE DISTRICT IS NOT OBLIGATED TO PAY THE LOCAL OBLIGATIONS EXCEPT FROM SUCH FUNDS. THE

GENERAL FUND OF THE CITY AND THE FUNDS OF THE DISTRICT ARE NOT LIABLE, AND

NEITHER THE FULL FAITH AND CREDIT OF THE DISTRICT NOR THE CITY ARE PLEDGED

FOR THE PAYMENT OF THE INTEREST ON OR PRINCIPAL OF OR REDEMPTION PREMIUMS, IF ANY, ON THE LOCAL OBLIGATIONS. NO TAX OR ASSESSMENT OTHER THAN THE

SPECIAL TAX SHALL EVER BE LEVIED OR COLLECTED TO PAY THE INTEREST ON OR PRINCIPAL OF OR REDEMPTION PREMIUMS, IF ANY, ON THE LOCAL OBLIGATIONS. THE

LOCAL OBLIGATIONS ARE NOT SECURED BY A LEGAL OR EQUITABLE PLEDGE OF OR

CHARGE, LIEN OR ENCUMBRANCE UPON ANY PROPERTY OF THE DISTRICT OR ANY OF

ITS INCOME OR RECEIPTS EXCEPT THE PROCEEDS OF THE SPECIAL TAX (INCLUDING 21

04/12/2022 Item No.13.

ANY PREPAYMENTS THEREOF AND PROCEEDS FROM THE SALE OF PROPERTY

COLLECTED PURSUANT TO THE FORECLOSURE PROVISIONS OF THE LOCAL

OBLIGATIONS INDENTURE FOR THE DELINQUENCY OF THE SPECIAL TAX), NET OF

PRIORITY ADMINISTRATIVE EXPENSES, AND AMOUNTS IN CERTAIN FUNDS AND

ACCOUNTS ESTABLISHED IN THE LOCAL OBLIGATIONS INDENTURE, AND NEITHER THE

PAYMENT OF THE INTEREST ON OR PRINCIPAL OF OR REDEMPTION PREMIUMS, IF ANY,

ON THE LOCAL OBLIGATIONS IS A GENERAL DEBT, LIABILITY OR OBLIGATION OF THE DISTRICT. THE LOCAL OBLIGATIONS DO NOT CONSTITUTE AN INDEBTEDNESS OF THE

DISTRICT WITHIN THE MEANING OF ANY CONSTITUTIONAL OR STATUTORY DEBT

LIMITATION OR RESTRICTION, AND NEITHER THE CITY COUNCIL NOR THE DISTRICT

NOR ANY OFFICER OR EMPLOYEE THEREOF SHALL BE LIABLE FOR THE PAYMENT OF

THE INTEREST ON OR PRINCIPAL OF OR REDEMPTION PREMIUMS, IF ANY, ON THE LOCAL

OBLIGATIONS OTHERWISE THAN FROM THE PROCEEDS OF THE SPECIAL TAX (INCLUDING ANY PREPAYMENTS THEREOF AND PROCEEDS FROM THE SALE OF

PROPERTY COLLECTED PURSUANT TO THE FORECLOSURE PROVISIONS OF THE LOCAL

OBLIGATIONS INDENTURE FOR THE DELINQUENCY OF THE SPECIAL TAX), NET OF

PRIORITY ADMINISTRATIVE EXPENSES, AND AMOUNTS IN CERTAIN FUNDS AND ACCOUNTS ESTABLISHED IN THE LOCAL OBLIGATIONS INDENTURE.

Although the Special Tax will constitute a lien on property subject to taxation in the Improvement Area, it will not constitute a personal indebtedness of the owners of such property. There is no assurance that the owners will be financially able to pay the annual Special Tax or that they will pay such tax even if financially able to do so. The risk of nonpayment by property owners is more fully described m "CERTAIN RISKS TO BONDHOLDERS- Collection of Special Tax." Local Obligations Flow of Funds
Application of Special Tax Fund. Pursuant to the Local Obligations Indenture, the District agrees and covenants that it will deposit the Special Tax proceeds in the Community Facilities Fund, which fund is established in the treasury of the City. All money in the Community Facilities Fund shall be used and withdrawn by the District solely for the benefit of the District in accordance with the Mello-Roos Act, including payment of Expenses. Pursuant to the Local Obligations Indenture, the District further agrees and covenants that, after payment of Priority Administrative Expenses, it will transfer to the Local Obligations Trustee from the Community Facilities Fund amounts sufficient and in sufficient time for the Local Obligations Trustee to make the transfers required by it, and the Local Obligations Trustee shall deposit such proceeds as and when received in the Special Tax Fund. All money in the Special Tax Fund is required to be set aside by the Local Obligations Trustee in the following respective special account and fund within the Special Tax Fund in the following order of priority, and all money in each such account and fund shall be applied, used and withdrawn only for the purposes specified in the Local Obligations Indenture:
(I) Redemption Account; and
(2) Local Obligations Reserve Fund.

Redemption Account. On or before March 1 and September 1 in each year, the Local Obligations Trustee shall, from the money in the Special Tax Fund, transfer to and deposit in the Redemption Account an amount of money equal to the aggregate amount of interest becoming due and payable on all Outstanding Local Obligations, 2020 IAl Obligations and any Additional Local Obligations on such March 1 or September 1, as the case may be, and on or before September 1 in each year, the Local Obligations Trustee shall, from the then remaining money in the Special Tax Fund, transfer to and deposit 22

04/12/2022 Item No.13.
in the Redemption Account an amount of money equal to the aggregate amount of principal becoming due and payable on all Outstanding serial Local Obligations, 2020 IA 1 Obligations and any Additional Local Obligations on such September 1 plus all Minimum Sinking Fund Account Payments required to be made on such September 1 into the Sinking Fund Subaccount; provided, that all of the aforesaid payments shall be made without priority of any payment over any other payment, and in the event that money in the Special Tax Fund on any March 1 or September 1 is not equal to the amount of interest becoming due on all Local Obligations, 2020 IA 1 Obligations and any Additional Local Obligations on such date, or in the event that the money in the Special Tax Fund on any September 1 is not equal to the amount of principal of the Local Obligations, 2020 IA 1 Obligations and Additional Local Obligations becoming due on such date, as the case may be, then such money shall be applied pro rata in such proportion as such interest and principal and Minimum Sinking Fund Account Payments bear to each other.

No deposit need be made into the Redemption Account if the amount of money contained therein is at least equal to the amount required by the terms of the preceding paragraph to be deposited therein at the times and in the amounts provided in the Local Obligations Indenture.

All money in the Redemption Account shall be used and withdrawn by the Local Obligations Trustee to pay the interest on the Local Obligations, 2020 IAl Obligations and any Additional Local Obligations as it shall become due and payable (including accrued interest on any Local Obligations, 2020 IAl Obligations or any Additional Local Obligations purchased or redeemed prior to maturity) plus the principal of and redemption premiums, if any, on the Local Obligations, 2020 IAl Obligations and any Additional Local Obligations as they shall mature or upon the prior redemption thereof, except that any money in the Sinking Fund Subaccount shall be used only to purchase or redeem or retire the term Local Obligations, 2020 IA 1 Obligations and any Additional Local Obligations as provided in the Local Obligations Indenture.

Local Obligations Reserve Fund. On or before March 1 and September 1 in each year, the Local Obligations Trustee shall, from the then remaining money in the Special Tax Fund, transfer to and deposit in each Local Obligations Reserve Account within the Local Obligations Reserve Fund such amount of money as shall be required to restore each such Local Obligations Reserve Account to a sum equal to the Required Bond Reserve (as defined herein) for the applicable series of Local Obligations, 2020 IA] Obligations or Additional Local Obligations, pro rata, to the extent that amounts are available in the Special Tax Fund for such purpose; and for this purpose all investments in each Local Obligations Reserve Account shall be valued on March 1 and September 1 of each year at the face value thereof if such investments mature within twelve (12) months from the date of valuation, or if such investments mature more than twelve (12) months after the date of valuation, at the price at which such investments are redeemable by the holder at his option, if so redeemable, or if not so redeemable, at the lesser of (i) the cost of such investments plus the amortization of any premium or minus the amortization of any discount, or (ii) the market value of such investments. For purposes of allocating remaining money in the Special Tax Fund between more than one Local Obligations Reserve Account, any such transfers to and deposits in each Local Obligations Reserve Account shall be made equally and ratably.

No deposit need be made into a Local Obligations Reserve Account if the value of the investments contained therein is at least equal to the Required Bond Reserve for the applicable series of Local Obligations, 2020 IAl Obligations or Additional Local Obligations ..

All money in each Local Obligations Reserve Account shall be used and withdrawn by the Local Obligations Trustee solely for the purpose of paying the interest on or principal of the corresponding series of Local Obligations, 2020 IAl Obligations or Additional Local Obligations in the event there is insufficient money in the Redemption Account available for this purpose; provided, that if as a result of any of the foregoing valuations or due to redemption as a result of property owner prepayments it is 23

04/12/2022 Item No.13.
determined that the amount of money in a Local Obligations Reserve Account exceeds or will exceed the Required Bond Reserve for the applicable series of Local Obligations, 2020 IA 1 Obligations or Additional Local Obligations, the Local Obligations Trustee shall withdraw the amount of money representing such excess from such fund and shall deposit such amount of money in the Redemption Account. For the avoidance of doubt, amounts in a Local Obligations Reserve Account are not available to make up a deficiency for the payment of principal and interest on any series of Local Obligations, 2020 IA] Obligations or Additional Local Obligations, other than the specific series of Local Obligations, 2020 IA 1 Obligations or Additiona:I Local Obligations to which that Local Obligations Reserve Account relates.

Special Tax Authorization
The Special Tax is to be levied and collected against all Taxable Property within the Improvement Area in accordance with the rate and method of apportionment (the "Rate and Method of Apportionment"). See APPENDIX A- "RA TE, METHOD OF APPORTIONMENT AND MANNER OF COLLECTION OF SPECIAL TAX." The Special Tax is to be collected in the same manner as ordinary ad valorem property taxes are collected, and, except as otherwise provided in the covenant for foreclosure and in the Mello-Roos Act, is to be subject to the same penalties and the same procedure, sale and lien priority in case of delinquency as is provided for ad valorem property taxes. See "SECURITY AND SOURCES OF PAYMENT FOR THE BONDS- Covenant for Foreclosure" and "CERTAIN RISKS TO BONDHOLDERS- Collection of Special Tax."
The Rate and Method of Apportionment of the Special Tax, subject to the maximum rates set forth therein, apportions the total debt service requirement (principal, interest, and mandatory sinking fund payments), restoration of the Required Bond Reserve, current annual expenses, pay as you go improvement costs and other costs each year among the taxable land in the Improvement Area. See APPENDIX A- "RATE, METHOD OF APPORTIONMENT AND MANNER OF COLLECTION OF SPECIAL TAX."
Pursuant to the Local Obligations Indenture, so long as any Local Obligations, 2020 IAl Obligations or Additional Local Obligations are Outstanding, the District is required annually to levy the Special Tax against all Taxable Property in the Improvement Area and make provision for the collection of such Special Tax in amounts which will be sufficient, after making reasonable allowances for contingencies and errors in the estimates, to yield proceeds equal to the amounts required for compliance with the agreements, conditions, covenants and terms contained in the Local Obligations Indenture, and which in any event will be sufficient to pay the interest on and principal of and Minimum Sinking Fund Account Payments for and redemption premiums, if any, on the Local Obligations, 2020 IA! Obligations and any Additional Local Obligations as they become due and payable, to replenish each reserve account within the Local Obligations Reserve Fund to the Required Bond Reserve and to pay all current Expenses as they become due and payable.

Under the Mello-Roos Act, the Facilities Special Tax levied in any fiscal year against private residential property may not be increased as a consequence of delinquency or default by the owner or owners of any other parcel or parcels within the Improvement Area 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.

Under the Rate and Method of Apportionment, property is considered "Residential Property" and is subject to the aforementioned limitation once a building permit could be issued for the purposes of constructing one or more residential units. See "CERTAIN RISKS TO BONDHOLDERS- Maximum Special Tax."
24

04/12/2022 Item No.13.

Covenant for Foreclosure
The Local Obligations Indenture provides that the Special Tax is to be collected in the same manner as ordinary ad valorem property taxes are collected and, except as provided in the special covenant for foreclosure described below and in the Mello-Roos Act, is subject to the same penalties and the same procedure, sale, and lien priority in case of delinquency as is provided for ad valorem property taxes.

Pursuant to Section 53356.1 of the Mello-Roos Act, in the event of any delinquency in the payment of the Special Tax, the District 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 a judicial foreclosure sale. Such judicial foreclosure action is not mandatory.

However, the District has covenanted in the Local Obligations Indenture that it will annually on or before September 1 of each year review the public records of the County relating to the collection of the Special Tax in order to determine the amount of the Special Tax collected in the prior Fiscal Year, and if it determines on the basis of such review that the amount so collected is deficient by more than five percent (5%) of the total amount of the Special Tax levied in such Fiscal Year within the Improvement Area, it will within sixty (60) days thereafter institute foreclosure proceedings as authorized by the Mello-Roos Act in order to enforce the lien of the delinquent installments of the Special Tax against each lot or parcel of land in the Improvement Area, and will diligently prosecute and pursue such foreclosure proceedings to judgment and sale; provided, that irrespective of the foregoing if the District determines on the basis of such review that property owned by any single property owner in the Improvement Area is delinquent by more than four thousand dollars ($4,000) with respect to the Special Tax due and payable by such property owner by such delinquency date, then the District will institute, prosecute and pursue such foreclosure proceedings in the time and manner provided in the Local Obligations Indenture against such property owner; provided further, that any actions taken to enforce delinquent Special Tax liens shall be taken only consistent with Sections 53356.1 through 53356.7, both inclusive, of the Government Code of the State of California; and provided further, that the District is not obligated under the Local Obligations Indenture to enforce the lien of any delinquent installment of the Special Tax for any Fiscal Year in which the District has received one hundred percent (100%) of the amount of such installment from the County pursuant to the Teeter Plan (described herein).

In the event that sales or foreclosures of property are necessary, there could be a delay in payments to Owners of the Bonds (if the Local Obligations Reserve Account has been depleted) pending such sales or the prosecution of such foreclosure proceedings and receipt by the District of the proceeds of sale. However, within the limits of the Special Tax, the District may adjust the Special Tax levied on Taxable Property in the Improvement Area (subject to the limitation on the Maximum Special Tax, defined herein), to provide an amount required to pay interest on and principal of the Local Obligations and any additional obligations payable from the Special Tax, and the amount, if any, necessary to replenish each subaccount of the Local Obligations Reserve Fund to an amount equal to the Required Bond Reserve and to pay all current Expenses for the Improvement Area. There is, however, no assurance that the total amount of the Special Tax that could be levied and collected against Taxable Property (as defined in the Rate and Method of Apportionment) in the Improvement Area will be at all times sufficient to pay the amounts required to be paid by the Local Obligations Indenture, even if the Special Tax is levied at the Maximum Special Tax rates. See "CERTAIN RISKS TO BONDHOLDERS- Maximum Special Tax."
No assurance can be given that the real property subject to sale or foreclosure will be sold, or if sold, that the proceeds of sale will be sufficient to pay any delinquent installments of the Special Tax.

The Mello-Roos Act does not require the District to purchase or otherwise acquire any lot or parcel of property to be sold if there is no other purchaser at such sale. The Mello-Roos Act and the Local 25

04/12/2022 Item No.13.

Obligations Indenture do specify that the Special Tax will have the same lien priority as for ad valorem property taxes in the case of delinquency. Section 53356.6 of the Mello-Roos Act requires that property within the Improvement Area that is sold pursuant to foreclosure under the Mello-Roos 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 at least 75% of the Local Obligations, 2020 IAl Obligations and any Additional Local Obligations issued under the Local Obligations Indenture is obtained.

No Required Advances from Available Surplus Funds
Neither the City nor the District is obligated to advance available surplus funds available from the City treasury to pay debt service on the Local Obligations or to replenish the Local Obligations Reserve Account; provided, that nothing shall affect the right of the District under the Mello-Roos Act to make advances to cure any deficiencies.

Terms of the Local Obligations
General. The City Council of the City established the District and designated the Improvement Area therein on May 26, 2020. On that same date, the eligible voters of the District in the Improvement Area authorized the issuance of bonds in an amount not to exceed $76,000,000 for the Improvement Area.

However, based on the expected Special Tax revenues, the District expects that obligations issued to finance improvements in the Improvement Area will be issued for the Improvement Area in a total amount of approximately $33,160,000*. This amount may vary depending on the timing of the issuance of 'the Additional Local Obligations and the applicable interest rates at the time of any such issuance. The 2020 IA] Obligations were issued in the aggregate principal amount of $12,925,000 pursuant to the Mello-Roos Act and the Local Obligations Indenture and are currently outstanding in the amount of $12,925,000. The District may issue Additional Local Obligations on parity with the Local Obligations and the 2020 IA] Obligations in accordance with the Local Obligations Indenture.

The Local Obligations will be the second issuance of bonds for the Improvement Area. The Local Obligations will be issued in the aggregate principal amount of $13,235,000* pursuant to the Mello­ Roos Act and the Local Obligations Indenture. The Local Obligations will be dated the date of delivery of the Bonds. The Local Obligations are secured by a pledge of the Special Tax (net of Priority Administrative Expenses) levied within the Improvement Area.

Local Obligations Reserve Account. The Local Obligations Indenture establishes, for this series of the Local Obligations specifically, a Local Obligations Reserve Account within the Local Obligations Reserve Fund to be held by the Local Obligations Trustee. The Local Obligations Indenture requires that there be maintained in the Local Obligations Reserve Account an amount equal to the Required Bond Reserve. "Required Bond Reserve" is defined to mean, for the Local Obligations specifically, as of any date of calculation, the least of: (a) the Maximum Annual Debt Service, (b) one hundred twenty-five percent (125%) of the Average Annual Debt Service or ( c) ten (10%) percent of the original proceeds of the Local Obligations; provided that the Required Bond Reserve shall be calculated on the date of issuance of the Local Obligations issued under the Local Obligations Indenture and shall not increase thereafter; and provided further that such requirement ( or any portion thereof) may be satisfied by the provision of one or more policies of municipal bond insurance or surety bonds issued by a municipal bond insurer or by a letter of credit issued by a bank, the obligations insured by which insurer or issued by which bank, as the case may be, have ratings at the time of issuance of such policy or surety bond or letter of credit equal to "AA" or higher (without regard to qualifier) assigned by Fitch or "Aa" or higher • Preliminary, subject to change.
26

04/12/2022 Item No.13.
(without regard to qualifier) assigned by Moody's or "AA" or higher (without regard to qualifier) assigned by S&P.

The Local Obligations Reserve Account is established specifically for the Local Obligations, and amounts in the Local Obligations Reserve Account are not available to make up a deficiency for the payment of principal and interest on the 2020 IA 1 Obligations or any Additional Local Obligations.

Pursuant to the Local Obligations Indenture, each reserve account within the Local Obligations Reserve Fund is only available for paying the interest on or principal of the corresponding series of Local Obligations, 2020 IA 1 Obligations or Additional Local Obligations for which it was created.

The Required Bond Reserve with respect to the Local Obligations upon their date of issuance will be$ - - - - - -
All money in the Local Obligations Reserve Account will be used and withdrawn by the Local Obligations Trustee solely for the purpose of paying the interest on and principal of the Local Obligations in the event there is insufficient money available for the purpose; provided, that if as a result of any of the valuation of a Required Bond Reserve or as a result of any property owner prepayment it is determined that the amount of money in the Local Obligations Reserve Account exceeds the Required Bond Reserve, the Local Obligations Trustee shall withdraw the amount of money representing such excess from such fund and shall deposit such amount of money in the Redemption Account. Amounts on deposit in the Local Obligations Reserve Account are not available to cure a deficiency in Revenues available to pay debt service on the Bonds.

Additional Local Obligations. The District may at any time, by a supplement to the Local Obligations Indenture, issue Additional Local Obligations that are payable from the proceeds of the Special Tax (after payment of Priority Administrative Expenses) on parity with the Local Obligations and the 2020 IAl Obligations, subject to the following conditions, which conditions are precedent to the issuance of such Additional Local Obligations:
(i) The District shall be in compliance with all agreements, conditions, covenants and terms contained in the Local Obligations Indenture and in all Supplemental Indentures required to be observed or performed by it, and no Event of Default under the Local Obligations Indenture or under any Supplemental Indenture shall have occurred and shall be then continuing; (ii) The District shall establish a separate subaccount of the Local Obligations Reserve Fund for the payment of such Additional Local Obligations in an amount equal to the Required Bond Reserve; and
(iii) (a) In each year until the maturity date for the Additional Local Obligations, the Maximum Facilities Special Tax for Taxable Property classified as Developed Property, plus the Effective Tax Rate Evaluation Minimum Facilities Revenue (as defined in the Rate and Method of Apportionment) for Taxable Property not classified as Developed Property less Priority Administrative Expenses is estimated to cover at least one hundred ten percent (110%) of the sum of the Annual Debt Service for each year on the Local Obligations, 2020 IA] Obligations and all Additional Local Obligations, including such Additional Local Obligations to be issued, and (b) the Value of all Taxable Property, in aggregate, is at least three (3) times the aggregate Lien on such Taxable Property. "Facilities Special Tax" is the annual Special Tax to be levied in each Fiscal Year on each Assessor's Parcel of Taxable Property to fund the Facilities Special Tax Requirement in accordance with the Rate and Method of Apportionment (each as defined in the Rate and Method of Apportionment). 27

04/12/2022 Item No.13.
"Developed Property" means, for purposes of the requirement described above relating to the issuance of Additional Local Obligations, Taxable Property for which a building permit for new construction has been issued as of the date of calculation. "Maximum Facilities Special Tax" is the total maximum annual Facilities Special Tax, determined in accordance with the provisions of Section C of the Rate and Method of Apportionment, which may be levied in any Fiscal Year on any Assessor's Parcel of Taxable Property (each as defined in the Rate and Method of Apportionment).
"Value" is defined as the current assessed valuation of the Taxable Property and/or the appraised value of the Taxable Property determined by a MAI appraiser. "Lien" is defined in the Local Obligations Indenture as the aggregate principal amount of all overlapping debt and bonds (including the Local Obligations, 2020 IAl Obligations and any Additional Local Obligations) outstanding that are secured by a special tax levied pursuant to the Mello-Roos Act or a special assessment levied on property within the Improvement Area, including any overlapping debt or bonds for community facilities districts or special assessment districts that is reasonably allocated to property within the Improvement Area.

Notwithstanding the foregoing, the District may issue one or more series of Additional Local Obligations (the "Refunding Local Obligations") without meeting the requirements summarized in paragraph (iii) above if, after the issuance and delivery of such Refunding Local Obligations, either (i) none of the Local Obligations, 2020 IAI Obligations and Additional Local Obligations theretofore issued under the Local Obligations Indenture will be Outstanding or (ii) the Debt Service in each Bond Year that begins after the issuance of such Refunding Local Obligations is not increased by reason of the issuance of such Refunding Local Obligations.

Redemption of the Local Obligations" The Local Obligations are subject to extraordinary redemption by the District from funds derived by the District from prepayments of the Special Tax. The Local Obligations are also subject to optional and mandatory redemption by the District. A description of the redemption prices and terms of the Local Obligations is set forth under APPENDIX C- "SUMMARY OF PRINCIPAL DOCUMENTS- SUMMARY OF THE LOCAL OBLIGATIONS INDENTURE­ Redemption of Bonds."
Selection of Local Obligations for Redemption. If less than all the outstanding Local Obligations, 2020 IAl Obligations and any Additional Local Obligations are to be redeemed as a result of prepayments of the Special Tax at any one time, the Local Obligations, 2020 IA I Obligations and any Additional Local Obligations shall be redeemed pro rata by maturity. If less than all the outstanding Local Obligations, 2020 IAl Obligations and any Additional Local Obligations are to be redeemed at the option of the District at any one time, the Local Obligations, 2020 IAl Obligations and any Additional Local Obligations of the latest maturity date or dates shall be redeemed prior to or simultaneously with the redemption of the Local Obligations, 2020 IAl Obligations and any Additional Local Obligations maturing prior thereto, and if less than all the outstanding Local Obligations, 2020 IA 1 Obligations and any Additional Local Obligations of any one maturity date are to be redeemed at any one time, the Trustee shall select the Local Obligations, 2020 !Al Obligations and any Additional Local Obligations or the portions thereof of such maturity date to be redeemed in integral multiples of five thousand dollars ($5,000) in a manner that it deems appropriate and fair. • Preliminary, subject to change.
28

04/12/2022 Item No.13.

Special Tax Analysis
The following is a synopsis of the provisions of the Rate and Method of Apportionment, which should be read in conjunction with the complete text of the Rate and Method of Apportionment which is attached as APPENDIX A. The definitions of the capitalized terms used under this caption "- Special Tax Analysis" are as set forth in APPENDIX A. This section provides only a summary of the Rate and Method of Apportionment, and is qualified by more complete and detailed information contained in the entire Rate and Method of Apportionment attached as APPENDIX A. · The Special Tax is to be levied and collected against all Taxable Property within the Improvement Area in accordance with the Rate and Method of Apportionment approved by the landowner electors of the Improvement Area. The total annual levy of the Special Tax is calculated to satisfy the annual debt service during the ensuing Fiscal Year, to replenish the reserve fund for the Local Obligations, the allocable portion of administrative expenses, the amount necessary to cure any delinquencies or to fund any deficiency of the amount to be available for the payment of principal or interest on bonds which are expected to occur in the ensuing Fiscal Year, to fund authorized facilities funded on a pay-as-you-go basis, to fund authorized services expenses and to pay amounts required to establish or replenish certain funds related to authorized services, less any available capitalized interest and earnings on the funds that may be used to fund the aforementioned costs.

Assignment to Land Use Categories. Each Fiscal Year, all Assessor's Parcels within the Improvement Area will be classified by the CFD No. 23 IA 1 Administrator as either Taxable Property or Exempt Property. Taxable Property will be further classified as Developed Property, Small Lot Final Map Property, Permit Ready Multi-Family/Non-Residential Property, Large Lot Property, or Undeveloped Property and shall be subject to the levy of the annual Special Tax. "Developed Property" means, for each Fiscal Year, all Taxable Property for which a building permit for new construction was issued prior to June 30 of the previous Fiscal Year. "Small Lot Final Map Property" means, for each Fiscal Year, all Taxable Property for which a Small Lot Final Subdivision Map was recorded prior to June 30 of the previous Fiscal Year. "Permit Ready Multi-Family/Non-Residential Property" means an Assessor's Parcel of Taxable Property zoned for multi-family or non-residential land use for which all discretionary entitlements have been obtained, including without limitation, development plan review and improvement plan approval, such that building permits may be issued without further approvals for the construction of multi-family Residential Units or non-residential buildings within such Assessor's Parcel. The City shall have sole discretion, based upon available development information, in classifying an Assessor's Parcel as Permit Ready Multi-Family/Non-Residential Property.
"Large Lot Property" means, for each Fiscal Year, all Taxable Property for which a Large Lot Map was recorded prior to June 30 of the previous Fiscal Year, excluding any portion(s) thereof classified as Developed Property, Small Lot Final Map Property or Permit Ready Multi-Family/Non-Residential Property. Large Lot Property also means, for each Fiscal Year, all Taxable Property classified as Small Lot Final Map Remainder Property as of June 30 of the previous Fiscal Year. "Small Lot Final Map Remainder Property" means an Assessor's Parcel that is created from the subdivision of Large Lot Property by the recordation of a Small Lot Final Subdivision Map that has not yet been mapped for final development approval. Small Lot Final Map Remainder Property is that portion of property for which the Small Lot Final Subdivision Map definition does not apply (i.e., does not contain individual lots for which building permits may be issued for Residential Units without further 29

04/12/2022 Item No.13.
subdivision of such property). Each Fiscal Year, all Taxable Property classified as Small Lot Final Map Remainder Property, as of June 30 of the previous Fiscal Year, will be considered Large Lot Property. "Undeveloped Property" means, for each Fiscal Year, all Taxable Property not classified as Developed Property, Small Lot Final Map Property, Permit Ready Multi-Family/Non-Residential Property or Large Lot Property.
"Single-Family Detached Property - MLD Zoning" means, for each Fiscal Year, all Taxable Property for which a building permit could be issued for purposes of constructing one or more detached or attached Residential Units with a permitted density range of 7-12 Residential Units per Acre, which is more fully described in the Folsom Plan Area Specific Plan adopted on June 28, 2011 and as amended by the City Council.
"Single-Family Detached Property - SFISFHD Zoning" means, for each Fiscal Year, all Taxable Property for which a building permit could be issued for purposes of constructing one or more Residential Units. Single-Family Detached Property - SF/SFHD Zoning shall consist of either single-family property with a permitted density range of 1-4 Residential Units per Acre or single-family high density property with a permitted density range of 4- 7 Residential Units per Acre, which is more fully described in the Folsom Plan Area Specific Plan adopted on June 28, 2011 and as amended by the City Council. "MMD Multi-Family Attached Property" means all Assessor's Parcels for which a building permit could be issued for purposes of constructing one or more attached Residential Units per Assessor's Parcel with a permitted density range of 12-20 Residential Units per Acre, which is more fully described in the Folsom Plan Area Specific Plan adopted on June 28, 2011 and as amended by the City Council. "MHD Multi-Family Attached Property" means all Assessor's Parcels for which a building permit could be issued for purposes of constructing one or more attached Residential Units per Assessor's Parcel with a permitted density range of greater than 20 Residential Units per Acre, which is more fully described in the Folsom Plan Area Specific Plan adopted on June 28, 2011 and as amended by the City Council. MHD Multi-Family Attached Property shall also include an Assessor's Parcel or that portion of an Assessor's Parcel designated as a Mixed Use Residential Parcel. "Mixed Use Residential Parcel" means a mixed use Assessor's Parcel that is designated for residential land use. If the mixed use Assessor's Parcel contains a combination of residential land use and non-residential land use, only that portion of an Assessor's Parcel designated for residential land use shall be classified as a Mixed Use Residential Parcel and the remaining non-residential land use of the Assessor's Parcel shall be classified as Non-Residential Property. "Non-Residential Property" means, for each Fiscal Year, all Taxable Property for which a building permit could be issued for purposes of constructing non-residential buildings.

Maximum Special Tax. The Rate and Method of Apportionment is used to allocate the amount of the Special Tax required among the Taxable Property, based upon land use categories, subject to the Maximum Special Tax Rate that may be levied against each land use category.

The following table shows the Effective Tax Rate Evaluation Minimum Facilities Special Tax rates and the Maximum Special Tax rates within the Improvement Area for all anticipated allocable land use categories in Fiscal Year 2022-23. The Effective Tax Rate Evaluation Minimum Facilities Special Tax rates are the minimum rates for the Effective Tax Rate Evaluation Maximum Facilities Special Tax. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
30

04/12/2022 Item No.13.

Table 3
City of Folsom
Communities Facilities District No. 23 (Folsom Ranch)
Improvement Area No. 1
Maximum Special Tax Rate Categories
Fiscal Year 2022-23
Effective Effective Tax
Tax Rate Rate
Evaluation Evaluation
Minimum Maximum Maximum Maximum
Facilities Facilities Services Annual
Residential Special Special Tax Special Special
Tax Category Floor Area Tax Rate<1> Rate(1> Tax Rate'" Tax(3l Developed Property ($ amounts per residential unit)
Single-Family Detached Property - SF/SFHD Zoning 2: 3,600 $1,976 $2,431 $221 $2,652 Single-Family Detached Property - SF/SFHD Zoning 3,200 - 3,599 1,976 2,431 221 2,652 Single-Family Detached Property - SF/SFHD Zoning 2,800 - 3, 199 1,976 2,431 221 2,652 Single-Family Detached Property - SF/SFHD Zoning 2,400 - 2,799 1,976 2,340 221 2,561 Single-Family Detached Property - SF/SFHD Zoning 2,000 - 2,399 1,976 2,193 221 2,414 Single-Family Detached Property - SF/SFHD Zoning < 2,000 1,976 1,976 221 2,197 Single-Family Detached Property - MLD Zoning 2: 3,600 2,286 2,635 164 2,799 Single-Family Detached Property - MLD Zoning 3,200 - 3,599 2,286 2,635 164 2,799 Single-Family Detached Property - MLD Zoning 2,800 - 3,199 2,286 2,635 164 2,799 Single-Family Detached Property - MLD Zoning 2,400 - 2,799 2,286 2,635 164 2,799 Single-Family Detached Property - MLD Zoning 2,000 - 2,399 2,286 2,452 164 2,616 Single-Family Detached Property - MLD Zoning < 2,000 2,286 2,286 164 2,450 Developed Property ($ amounts per acre)
MMD Multi-Family Attached Property NIA $31,212 $31,212 $526 $31,738 MHD Multi-Family Attached Property NIA 12,173 12,173 1,052 13,225 Non-Residential Property NIA 12,173 12,173 1,052 13,225 Small Lot Final Map Property
($ amounts per residential lot)
Single-Family Detached Property - SF/SFHD Zoning NIA NIA $1,976 $221 $2,197 Single-Family Detached Property - MLD Zoning NIA NIA 2,286 164 2,450 Permit Ready Multi-Family/Non-Residential NIA NIA $12,173 $ 1,052 $13,225 Property($ amounts per acre)
Large Lot Property($ amounts per acre) NIA NIA $23,409 $1,473 $24,882 Undeveloped Property($ amounts per acre) NIA NIA $23,409 $1,473 $24,882 (I) Increases by 2% each Fiscal Year.
(2) Increases by the annual June consumer price index change for the San Francisco-Oakland-San Jose area, not to exceed 4% each Fiscal Year.

Available to pay debt service on the Local Obligations, the 2020 JAi Obligations and any Additional Local Obligations in the event of a shortfall in the Facilities Special Tax (as defined in the Local Obligations Indenture). Estimated to increase by 2% for Fiscal Year 2022-23. (3) The sum of the Effective Tax Rate Evaluation Maximum Facilities Special Tax and the Maximum Services Special Tax.

Source: NBS and the District.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
31

04/12/2022 Item No.13.

The total Special Tax generated by the Improvement Area may change from time to time if there are amendments or modifications to the development plan. The District covenants in the Local Obligations Indenture to not approve any amendments, changes or modifications relating to development of the property within the Improvement Area that would reduce the amount of the Maximum Facilities Special Tax less Priority Administrative Expenses to equal less than one hundred ten percent ( 110%) of the sum of the Annual Debt Service on the Local Obligations, 2020 IA 1 Obligations and any Additional Local Obligations in any year until the maturity date for the Local Obligations, 2020 JAi Obligations and any Additional Local Obligations.

Tables 4 and 5 under "- Special Tax Calculation" collectively show the estimated maximum and projected actual amounts of Special Tax revenue for Fiscal Year 2022-23 using the development status of the properties as of March 8, 2022 (unless otherwise noted). Table 4 shows the Fiscal Year 2022-23 estimated Effective Tax Rate Evaluation Maximum Facilities Special Tax revenues, based on the development status of the properties as of March 8, 2022 (unless otherwise noted). If changes are made to development plans for the Improvement Area, the projected Effective Tax Rate Evaluation Maximum Facilities Special Tax revenues may decrease from the amounts shown in that table, but in no event will the Effective Tax Rate Evaluation Maximum Facilities Special Tax revenues decrease below the Effective Tax Rate Evaluation Minimum Facilities Revenue. Table 5 shows the estimated total Special Tax levy for Fiscal Year 2022-23 based on the properties' development status as of March 8, 2022 (unless otherwise noted), including both the estimated Facilities Special Tax levy and the estimated Services Special Tax levy for Fiscal Year 2022-23, and the percentage of the estimated Special Tax levy allocable to each of the projected property owners.

Included below are additional relevant defined terms used 111 the Rate and Method of Apportionment.
"Effective Tax Rate Evaluation Minimum Facilities Revenue" means, following the Effective Tax Rate Evaluation, the total minimum amount of CFD No. 23 JAi Effective Tax Rate Evaluation Maximum Facilities Special Tax, as adjusted annually by the Facilities Special Tax Escalation Factor after the Fiscal Year in which the Effective Tax Rate Evaluation occurs, less any Effective Tax Rate Evaluation Maximum Facilities Special Tax amounts prepaid and permanently satisfied pursuant to Section K. The Effective Tax Rate Evaluation Minimum Facilities Revenue, based on Planned Development, is set forth in Attachment D of the Rate and Method of Apportionment. "Effective Tax Rate Evaluation Maximum Facilities Special Tax" means the total maximum annual Facilities Special Tax, as determined during the Effective Tax Rate Evaluation, which may be levied in any Fiscal Year on any Assessor's Parcel of Taxable Property. "Effective Tax Rate Evaluation" means an evaluation of the Total Effective Tax Rate of Residential Property at the time of such evaluation. The Effective Tax Rate Evaluation will be based upon a prepared Price Point Study to determine the Total Effective Tax Rate for Residential Property, based upon the calculated Total Estimated Tax Burden.
"Total Effective Tax Rate" means the percentage of the Total Estimated Tax Burden as compared to the estimated average sales price identified in the Price Point Study for each land use category of Residential Property.
"Total Estimated Tax Burden" means the total amount of overlapping property taxes anticipated to be levied upon a Residential Unit, based upon the estimated average sales price identified in the Price Point Study and existing property tax rates for the current Fiscal Year. Existing property tax rates shall 32

04/12/2022 Item No.13.
reflect the actual property tax rates levied upon Taxable Property in the Fiscal Year that the Effective Tax Rate Evaluation is completed.

Future Assessor's Parcel Changes. The Effective Tax Rate Evaluation Maximum Facilities Special Tax shall be assigned to all future Assessor's Parcel(s) created from a subdivision, lot line adjustment, or merger of one or more Assessor's Parcels so that the revised total Effective Tax Rate Evaluation Maximum Facilities Special Tax revenue is not less than the total Effective Tax Rate Evaluation Minimum Facilities Revenue amount described in the Rate and Method of Apportionment.

Method of Apportionment - Facilities Special Tax. The CFD No. 23 IA 1 Administrator shall determine the Facilities Special Tax Requirement and levy the Facilities Special Tax until the amount of Facilities Special Taxes equals the Facilities Special Tax Requirement. The Facilities Special Tax shall be levied each Fiscal Year as follows:

First:

Second:

Third:

Fourth:

Fifth:

The Facilities Special Tax shall be levied Proportionately on all Developed Property at a rate up to 100% of the Effective Tax Rate Evaluation Maximum Facilities Special Tax in order to satisfy the Facilities Special Tax Requirement.

If additional monies are needed to satisfy the Facilities Special Tax Requirement after the first step has been completed, the Facilities Special Tax shall be levied Proportionately on all Small Lot Final Map Property at a rate up to 100% of the Effective Tax Rate Evaluation Maximum Facilities Special Tax. The Facilities Special Tax shall be levied on Small Lot Final Map Property for the entire portion of the Facilities Special Tax Requirement, excluding only Pay As You Go Costs.

If additional monies are needed to satisfy the Facilities Special Tax Requirement after the first two steps have been completed, the Facilities Special Tax shall be levied Proportionately on all Permit Ready Multi-Family/Non-Residential Property at a rate up to 100% of the Effective Tax Rate Evaluation Maximum Facilities Special Tax. The Facilities Special Tax shall be levied on Permit Ready Multi-Family/Non-Residential Property for the entire portion of the Facilities Special Tax Requirement, excluding only Pay As You Go Costs.

If additional monies are needed to satisfy the Facilities Special Tax Requirement after the first three steps have been completed, the Facilities Special Tax shall be levied Proportionately on all Large Lot Property at a rate up to 100% of the Effective Tax Rate Evaluation Maximum Facilities Special Tax. The Facilities Special Tax shall be levied on Large Lot Property for the entire portion of the Facilities Special Tax Requirement, excluding only Pay As You Go Costs.

If additional monies are needed to satisfy the Facilities Special Tax Requirement after the first four steps have been completed, the Facilities Special Tax shall be levied Proportionately on all Undeveloped Property at a rate up to 100% of the Effective Tax Rate Evaluation Maximum Facilities Special Tax. The Facilities Special Tax shall be levied on Undeveloped Property for the entire portion of the Facilities Special Tax Requirement, excluding only Pay As You Go Costs.

Method of Apportionment - Services Special Tax. The CFD No. 23 IAl Administrator shall determine the Services Special Tax Requirement and levy the Services Special Tax until the amount of Services Special Taxes equals the Services Special Tax Requirement. The Services Special Tax shall be 33

04/12/2022 Item No.13.
levied each Fiscal Year as follows:

First:

Second:

Third:

Fourth:

The Services Special Tax shall be levied Proportionately on all Developed Property at a rate up to 100% of the Maximum Services Special Tax in order to satisfy the Services Special Tax Requirement.

If additional monies are needed to satisfy the Services Special Tax Requirement after the first step has been completed, the Services Special Tax shall be levied Proportionately on all Small Lot Final Map Property at a rate up to I 00% of the Maximum Services Special Tax in order to satisfy the Services Special Tax Requirement.

If additional monies are needed to satisfy the Services Special Tax Requirement after the first two steps have been completed, the Services Special Tax shall be levied Proportionately on all Permit Ready Multi-Family/Non-Residential Property at a rate up to I 00% of the Maximum Services Special Tax in order to satisfy the Services Special Tax Requirement.

If additional monies are needed to satisfy the Services Special Tax Requirement after the first three steps have been completed, the Services Special Tax shall be levied Proportionately on all Large Lot Property at a rate up to 100% of the Maximum Services Special Tax in order to satisfy the Services Special Tax Requirement.
"Special Tax" means the annual Facilities Special Tax and Services Special Tax to be levied in each Fiscal Year on each Assessor's Parcel of Taxable Property to fund the Facilities Special Tax Requirement and the Services Special Tax Requirement.
"Facilities Special Tax Requirement" means that amount of Special Tax revenue required in any Fiscal Year for the Improvement Area to: (i) Pay Facilities Administrative Expenses in an amount designated by the City; (ii) pay annual debt service on all Outstanding Bonds due in the Bond Year beginning in such Fiscal Year; (iii) pay other periodic costs on Outstanding Bonds, including but not limited to, credit enhancement and rebate payments on Outstanding Bonds; (iv) pay any amounts required to establish or replenish any reserve funds for all Outstanding Bonds in accordance with the Indenture; (v) pay for reasonably anticipated delinquent Special Taxes based on the delinquency rate for Special Taxes levied in the previous Fiscal Year and known upcoming delinquencies; and (vi) pay for Pay As You Go Costs; less (vii) a credit for funds available to reduce the annual Facilities Special Tax levy as determined by the CFO No. 23 IAI Administrator pursuant to the Indenture. "Services Special Tax Requirement" means the amount of Services Special Tax revenue required in any Fiscal Year for the Improvement Area to: (i) Pay Services Administrative Expenses in an amount designated by the City; (ii) pay Authorized Services expenses; (iii) pay any amounts required to establish or replenish any repair and contingency funds, capital improvement funds, or reserve funds related to the Authorized Services expenses; (iv) cover any shortfalls that exist if, in any Fiscal Year, the levy of the Facilities Special Tax on each Assessor's Parcel of Taxable Property is insufficient to pay the Facilities Special Tax Requirement in that Fiscal Year (Facilities Special Tax Requirement shortfalls shall not include Pay As You Go Costs), and (v) pay for reasonably anticipated delinquent Services Special Taxes based on the delinquency rate for Services Special Taxes levied in the previous Fiscal Year; less (vi) a credit for funds available to reduce the annual Services Special Tax levy as determined by the CFO No. 23 IAI Administrator.
34

04/12/2022 Item No.13.

In accordance with the flow of Special Tax proceeds under the Local Obligations Indenture, in the event of a shortfall in the Facilities Special Tax to pay the Facilities Special Tax Requirement, the proceeds of the Services Special Tax will be applied to help cover the Facilities Special Tax shortfall before being applied to fund Authorized Services. See "SECURITY AND SOURCES OF PAYMENT FOR THE BONDS- Local Obligations Flow of Funds."
Residential Property Limitation. Under no circumstances will the Facilities Special Tax levied in any fiscal year against Residential Property be increased as a consequence of delinquency or default by the owner or owners of any other parcel or parcels within the Improvement Area 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. Pursuant to the Rate and Method of Apportionment, property is considered "Residential Property" once a building permit could be issued for the purposes of constructing one or more Residential Units, including either single family detached homes or multi-family attached properties, such as apartments. See "CERTAIN RISKS TO BONDHOLDERS- Maximum Special Tax." [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
35

04/12/2022 Item No.13.

Special Tax Calculation
The following tables reflect the estimated Effective Tax Rate Evaluation Maximum Facilities Special Tax revenues for Fiscal Year 2022-23 (Table 4) and the estimated total Special Tax levy for Fiscal Year 2022-23 (Table 5), each based on the development status of the properties as of March 8, 2022 (unless otherwise noted). For Table 4, the estimated Effective Tax Rate Evaluation Maximum Facilities Special Tax revenues for Small Lot Final Map Property are equal to the Effective Tax Rate Evaluation Minimum Facilities Revenues until a building permit is issued for such property. The following tables do not necessarily reflect the Special Tax that will be actually levied in any year. See "PROPOSED PROPERTY DEVELOPMENT- Development Entitlements" for a discussion of the anticipated timing of the final map approval for Villages 3, 5 and 6.

Table 4
City of Folsom
Community Facilities District No. 23 (Folsom Ranch)
Improvement Area No. 1
Estimated 2022-23 Effective Tax Rate Evaluation Maximum Facilities Revenue Development Status as of March 8, 2022 (unless otherwise noted) Percentage of
Estimated 2022-23 Estimated 2022-23
Effective Tax Rate Effective Tax
Evaluation Rate Evaluation
Planned Appraised Maximum Facilities Maximum
Property Units Value<1> Revenue<2><3> Facilities Revenue Developed Property:

Single-Family Detached Property - SF/SFHD Zoning 80 $30, 160,608 $174,223 11% Single-Family Detached Property - MLD Zoning 140 62,835,567 335,936 22% Developed Property Total: 220 $92,996,175 $510,159 33%
Small Lot Final Map Propertyw'?':

Single-Family Detached Property - SF/SFHD Zoning 361 $65,145,871 $713,231 46% Single-Family Detached Property - MLD Zoning ~ 21,081,481 187,432 12% Small Lot Final Map Property Total: 443 $86,227,352 $900,663 58% Remaining Lots:

Permit Ready Multi-Family/Non-Residential Property-" 265 4,096,128 $129,882 8% Remaining Lots Total: 265 4,096,128 $129,882 8%
Total Effective Tax Rate Maximum Facilities Revenue's': 928 $183,319,655 $1,540,704 100% (!) Appraised value amounts provided by the Appraiser.
(Z) Increases by 2% each Fiscal Year.
<3) The 2022-23 Effective Tax Rate Evaluation Minimum Facilities Revenue amount is $1,498,023. <4) Villages 3, 5 and 6 Small Lot Final Maps are scheduled to record prior to June 30, 2022. <5) Dollar amounts per acre.
(6) Totals may not sum due to rounding.
<7) Reflects the estimated Fiscal Year 2022-23 Effective Tax Rate Evaluation Minimum Facilities Revenues, which is equal to the Effective Tax Rate Evaluation Maximum Facilities Special Tax revenues until a building permit is issued for such properties.

Source: NBS.
36

04/12/2022 Item No.13.

Table 5
City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 1 Estimated 2022-23 Special Tax Levy
Development Status as of March 8, 2022 (unless otherwise noted) Percent of
Estimated Estimated
Planned Facilities Special Facilities Special
Property and Owner Development Status Units Tax Levy'!' Tax Levy Village 4 - KB HOME Sacramento Developed Property 38 $80,746 6% Village 4 - KB HOME Sacramento Small Lot Final Map Property 20 33,417 3% Village 5 - KB HOME Sacramento'" Small Lot Final Map Property 83 145,365 11% Village 6 - KB HOME Sacramento!" Small Lot Final Map Property 70 110,277 9% Village 8 - KB HOME Sacramento Developed Property 2 4,921 0% Village 8 - KB HOME Sacramento Small Lot Final Map Property ----11 65,724 5% Total for KB HOME Sacramento: 247 $440,450 35%
Village I - CMB/Tri Pointe-" Developed Property 11 $26,105 2% Village 1 - CMB/Tri Pointef'' Small Lot Final Map Property 77 128,656 10% Village 2 - CMB/Tri Pointe'P Developed Property 16 35,703 3% Village 2 - CMB/Tri Pointe'P Small Lot Final Map Property ~ 96,910 8% Total for Tri Pointe: 162 $287,374 23%
Village 10 - Lennar Developed Property 51 $119,070 9%
Village 10 - Lennar Small Lot Final Map Property _-11 85,055 7% Total for Lennar: 95 $204,125 16%
Village 3 - Beazer Homes'" Small Lot Final Map Property 53 $88,556 7% Village 7 - Signature Homes Developed Property 36 $88,846 7% Village 7 - Signature Homes Small Lot Final Map Property _ _ 4 7 732 1% Total for Signature Homes: 40 $96,578 8%
Individual Homeowners Developed Property 66 $154,767 12% Lots C and D - ECIC Permit Ready Multi-Family/Non-Residential Property 265 Tutals'v: 928 $1,271,850 100%
Estimated Percent of
Services Estimated Estimated
Special Total Special Total Special
Tax Levy Tax Levy Tax Levy
$8,396 $89,142 6%
4,419 37,836 3%
19,223 164,587 12%
14,583 124,859 9%
328 5,249 0%
5,580 71,304 _lli
$52,529 $492,979 35%
$2,430 $28,535 2%
17,013 145,669 10%
3,535 39,238 3%
12,815 109,725 8%
$35,794 $323,168 23%
$8,371 $127,441 9%
7,222 92,276 7%
$15,592 $219,717 16%
$11,710 $100,266 7%
$5,909 $94,755 7%
____fil1. 8,389 _ill
$6,565 $103,143 7%
$11,685 $166,452 12%
$11,227 $11,227 1%
$145,102 $1,416,952 100%
(I) Based on estimated debt service requirements for the Bonds plus Priority Administrative Expenses of $20,400. <2> Small Lot Final Maps for Villages 3, 5 and 6 are scheduled to record prior to June 30, 2022. <3) Tri Pointe has contracted to purchase the Village 1 and Village 2 properties through three separate takedowns, the first of which occurred in January 2022 for 54 lots. No assurance can be given that the conveyance of the remaining two takedowns totaling 108 lots will occur as expected. See "PROPOSED PROPERTY DEVELOPMENT- Property Ownership- Tri Pointe Purchase and Sale Agreement."
<4> Totals may not sum due to rounding.

Source: NBS.
37

04/12/2022 Item No.13.

The Teeter Plan
In 1949, the State Legislature enacted an alternative method for the distribution of secured property taxes to local agencies. This method, known as the Teeter Plan, is now set forth in Sections 4701-4717 of the California Revenue and Taxation Code. Upon adoption and implementation of the Teeter Plan by a county board of supervisors, local agencies for which the county acts as "bank" and certain other public agencies and taxing areas located in the county receive annually the full amount of their share of property taxes on the secured roll, including delinquent property taxes which have yet to be collected. While a county benefits from the penalties associated with these delinquent taxes when they are paid, the Teeter Plan provides participating local agencies with stable cash flow and the elimination of collection risk.

To implement a Teeter Plan, the board of supervisors of a county generally must elect to do so by July 15 of the fiscal year in which it is to apply. The Sacramento County Board of Supervisors has adopted the Teeter Plan. Once adopted, a county's Teeter Plan will remain in effect in perpetuity unless the board of supervisors orders its discontinuance or unless prior to the commencement of a fiscal year a petition for discontinuance is received and joined in by resolutions of the governing bodies of not less than two-thirds of the participating districts in the county. An electing county may, however, opt to discontinue the Teeter Plan with respect to any levying agency in the county if the board of supervisors, by action taken not later than July 15 of a fiscal year, elects to discontinue the procedure with respect to such levying agency and the rate of secured tax delinquencies in that agency in any year exceeds 3% of the total of all taxes and assessments levied on the secured roll by that agency. See "CERTAIN RISKS TO BONDHOLDERS- Teeter Plan Termination."
Upon making a Teeter Plan election, a county must initially provide a participating local agency with 95% of the estimated amount of the then accumulated tax delinquencies (excluding penalties) for that agency. In the case of the initial year distribution of special taxes and assessments (if a county has elected to include assessments), 100% of the special tax delinquencies (excluding penalties) are to be apportioned to the participating local agency which levied the special tax. After the initial distribution, each participating local agency receives annually 100% of the secured property tax levies to which it is otherwise entitled, regardless of whether the county has actually collected the levies.

If any tax or assessment which was distributed to a Teeter Plan participant is subsequently changed by correction, cancellation or refund, a pro rata adjustment for the amount of the change is made on the records of the treasurer and auditor of the county. Such adjustment for a decrease in the tax or assessment is treated by the County as an interest-free offset against future advances of tax levies under the Teeter Plan.

The Special Tax for the District will be submitted to the County for direct levy. By submitting the Special Tax to the County, the District has agreed to allow the District to participate in the County's Teeter Plan. The County annually determines whether to include a particular direct levy and may make that determination on a district by district basis or a parcel by parcel basis. In addition, the County may not decide to include a particular parcel or district that had been included in its Teeter Plan in the previous year. The District can provide no assurance that the County will continue to include the District or any improvement area therein, including the Improvement Area, in the Teeter Plan.

To the extent that the County's Teeter Plan continues in existence and is carried out as adopted, the County's Teeter Plan may help protect the Owners of the Bonds from the risk of delinquencies in Special Taxes.
38

04/12/2022 Item No.13.

THE AUTHORITY
The Authority was created by a Joint Exercise of Powers Agreement, effective April 20, 2015 (the "JPA Agreement"), between the City and the City of Folsom South of 50 Parking Authority. The JP A Agreement was entered into pursuant to the Joint Exercise of Powers Act, Chapter 5 of Division 7 of Title 1 of the Government Code of the State. The Authority was created for the purpose of facilitating financing of public improvement facilities within the City south of US Route 50.

THE CITY
The Improvement Area is located in the City, which is located in the easterly section of the Sacramento metropolitan area approximately 22 miles east of the central business district of the City of Sacramento.

Certain economic and demographic information with respect to the City is contained in APPENDIX B. This information is presented solely as background information. The Local Obligations are not general obligations of the City but, rather, are special tax obligations of the District secured solely by the Special Taxes to be paid by the owners of property in the Improvement Area and funds held pursuant to the Local Obligations Indenture.

THE IMPROVEMENT AREA
General Description and Location
The District is a community facilities district organized by the City Council as the legislative body of the District under the Mello-Roos Act for the purpose of providing for the acquisition and construction of certain public improvements and the financing of certain services to serve property within the District. The City established the District on May 26, 2020, and designated six separate improvement areas therein, including the Improvement Area. On May 26, 2020, elections were held within the Improvement Area and the other improvement areas within the District at which the eligible voters in each improvement area approved the levy of special taxes in accordance with the respective Rate and Method of Apportionment of Special Tax for such improvement area. In addition, the eligible voters in the Improvement Area authorized the issuance of bonds in an amount not to exceed $76,000,000 for the Improvement Area. The District expects that such bonds and any bonds issued for the other improvement areas within the District from time to time will be issued to finance the authorized public facilities for the benefit of the District. With respect to the Improvement Area, such bonds will be issued only in accordance with the provisions of the Local Obligations Indenture. The total bonded indebtedness authorized in the Improvement Area will be limited by the requirements of the Local Obligations Indenture, including the following requirements relating to any Additional Local Obligations: a 3: 1 overlapping value to lien ratio on all land projected to be subject to the levy of the Special Tax and 110% annual coverage from the Maximum Facilities Special Tax for Taxable Property classified as Developed Property (as defined in the Local Obligations Indenture), plus the Effective Tax Rate Evaluation Minimum Facilities Revenue for Taxable Property not classified as Developed Property (as defined in the Local Obligations Indenture) less Priority Administrative Expenses. See "SECURITY AND SOURCES OF PAYMENT FOR THE BONDS- Terms of the Local Obligations- Additional Local Obligations." The Improvement Area is located in the southern portion of the City, east of East Bidwell Street, west of Placerville Road, north of Mangini Parkway and south of U.S. Highway 50 and consists of over 205 total gross acres, of which approximately 109 acres are expected to constitute Taxable Property subject to the Special Tax. The remainder of the property will include an elementary school, a fire station, a police substation, parks, trails and additional acreage planned for open space. Development 39

04/12/2022 Item No.13.
within the Improvement Area is planned to include, at the time of full build-out, 441 single-family high density units, 222 multi-family low density units and 265 multi-family high density units, for a total of 928 units. Both the single-family high density units and the multi-family low density units, representing 663 total residences, are expected to be developed as detached single-family homes, and the 265 multi­ family high density units are expected to be constructed as for-rent apartments. The maps appearing on the inside cover pages show the general location of the District and the Improvement Area.

Presently, the Improvement Area includes properties in varying stages development, including partially-improved lots, improved lots, homes under construction and completed homes. Collectively, these properties are planned to include 441 single-family high density units, 222 multi-family low density units and 265 multi-family high density units that are expected to be constructed as for-rent apartments.

Construction of the public improvements and backbone infrastructure in the Improvement Area is currently underway and has been completed for some properties, as more particularly described "PROPOSED PROPERTY DEVELOPMENT- Development Plans of Finance." The Improvement Area is located southwest of a residential community under current development known as Russell Ranch that is expected to include over 1,000 single family dwellings at full build-out, is immediately north of Mangini Ranch, a partially developed residential community that is also expected to include over 1,000 single family dwelling units at full build-out, and is northwest of an additional residential community known as White Rock Springs that is also under development and expected to include over 420 single family dwellings.

Property Values
An appraisal of the land within the Improvement Area has been prepared by the Appraiser in connection with the issuance of the Bonds. The appraisal estimates the land value as of February 18, 2022 (the "Appraisal"). The Appraisal is attached to this Official Statement as APPENDIX G.

As of the date of inspection, the Appraiser notes that development of the property is underway.

The subject property was valued based on the hypothetical conditions that (i) proceeds from the Bonds will be used to reimburse infrastructure improvements and (ii) the improvements to be financed by proceeds of the Bonds have been completed. The Appraisal is based on land values at the time of inspection. The Appraisal is also based on the extraordinary assumption expressed therein that the Improvement Area is located in a tax rate area with a corresponding, effective ad valorem property tax rate of 1.43 77%, which may change.

Subject to the assumptions, extraordinary assumption, hypothetical condition and limiting conditions, the Appraiser estimated that the value of the land within the Improvement Area, as of February 18, 2022, in aggregate, is $183,319,655. See "PROPOSED PROPERTY DEVELOPMENT­ Development Plan and Status of Development" below and APPENDIX G- "APPRAISAL." [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
40

04/12/2022 Item No.13.

Value-to-Lien Analysis
The following tables set forth the ratios of the appraised bulk value of the land to the total liens on the property in the Improvement Area. Table 6 shows the value-to-lien ratios for the Improvement Area as well as for the individual villages, Table 7 shows the value-to-lien ratios for the Improvement Area based on the development status of the property and Table 8 shows the value-to-lien ratios for the Improvement Area based on the owner of the property (which in some cases reflects the expected future owner). See "PROPOSED PROPERTY DEVELOPMENT- Development Entitlements." The value-to­ lien ratio for the Improvement Area based solely on the Local Obligations, the 2020 IA 1 Obligations and the appraised aggregate value of the land within the Improvement Area is 7 .o•: 1.0. The overall value to overlapping debt ratio including direct and overlapping assessment and special tax debt is 5.9':l.0 (see "- Overlapping Debt"). Any bonds secured by special assessments or special taxes issued from time to time may have the effect of reducing the value to lien ratio on property within the Improvement Area. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
• Preliminary, subject to change.
41