Folsom City Council
May 26, 2026

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2A Page 3
the duties required of it under the Indenture; the costs to the City, CFD No. 24 IA2A, or any designee thereof of complying with arbitrage rebate requirements or responding to questions from the IRS or SEC pertaining to any Bonds or any audit of any Bonds by the SEC or IRS; the costs to the City, CFD No. 24 IA2A, or any designee thereof of providing continuing disclosure regarding the Bonds pursuant to applicable state or federal securities law; the costs associated with preparing Facilities Special Tax disclosure statements and responding to public inquiries regarding the Facilities Special Taxes; the costs of the City, CFD No. 24 IA2A, or any designee thereof related to any appeal of the levy or application of the Facilities Special Tax; the costs associated with the release of funds from an escrow account, if any; and the costs associated with computing and preparing the Effective Tax Rate Evaluation, including the Price Point Study. Facilities Administrative Expenses shall also include amounts estimated or advanced by the City or CFD No. 24 IA2A for any other administrative purposes, including, but not limited to, attorney’s fees and other costs related to commencing and pursuing to completion any foreclosure of delinquent Facilities Special Taxes. “Facilities Special Tax” means 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. “Facilities Special Tax Escalation Factor” means two percent (2%) annually. “Facilities Special Tax Requirement” means that amount of Special Tax revenue required in any Fiscal Year for CFD No. 24 IA2A 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 CFD No. 24 IA2A Administrator pursuant to the Indenture. “Facilities Special Tax Term” means the earlier of Fiscal Year 2085-2086 or the Fiscal Year occurring 50 years following the Fiscal Year in which the first building permit was issued, or the first series of Bonds was issued within CFD No. 24 IA2A.
“Fiscal Year” means the period starting July 1 and ending on the following June 30. “Indenture” means the indenture, fiscal agent agreement, trust agreement, resolution or other instrument pursuant to which Bonds are issued, as modified, amended and/or supplemented from time to time, and any instrument replacing or supplementing the same. “Large Lot Map” means a recorded subdivision map creating larger parcels by land use. The Large Lot Map does not create individual lots for which building permits may be issued for single-family Residential Units.
“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

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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. “Maximum Facilities Special Tax” means the total maximum annual Facilities Special Tax, determined in accordance with the provisions of Section C, which may be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.
“Maximum Facilities Special Tax Rate” means the maximum annual Facilities Special Tax rate for each land use category of Taxable Property, as shown in Attachment A, which may be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.
“Maximum Services Special Tax” means the total maximum annual Services Special Tax, determined in accordance with the provisions of Section D, which may be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.
“Maximum Services Special Tax Rate” means the maximum annual Services Special Tax rate for each land use category of Taxable Property, as shown in Attachment A, which may be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.
“Maximum Special Tax” means, prior to the Transition Year, the total annual Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) and Maximum Services Special Tax, determined in accordance with the provisions of Section C and Section D, which may be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.

Beginning in the Transition Year, “Maximum Special Tax”, means the total annual Maximum Transition Services Special Tax, determined in accordance with the provisions of Section D, which may be levied in any Fiscal Year following the Transition Event on any Assessor’s Parcel of Taxable Property “Maximum Total Effective Tax Rate” means 1.80%, unless the City determines, in its sole discretion, that a higher Maximum Total Effective Tax Rate is appropriate. “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 and 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. “Minimum Facilities Revenue” means the minimum amount of total CFD No. 24 IA2A Maximum Facilities Special Tax, as adjusted annually by the Facilities Special Tax Escalation Factor, less any Maximum Facilities Special Tax amounts partially prepaid pursuant to Section L. The Minimum Facilities Revenue, based on Planned Development, is set forth in Attachment B of this Rate and Method of Apportionment. Following the Transition Event, the Minimum Facilities Revenue shall be zero.
“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

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Parcel with a permitted density range of 12-20 Residential Units per Acre and more fully described in the Folsom Plan Area Specific Plan adopted on June 28, 2011 and as amended by the City Council. “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. “Open Space Property” means property within the boundaries of CFD No. 24 IA2A which (a) has been designated with specific boundaries and acreage on a Small Lot Final Subdivision Map as open space, or (b) is classified by the City zoning code or County Assessor as open space, or (c) has been irrevocably offered for dedication as open space to the federal government, the State of California, the County, the City, any other public agency, a private, non-profit organization, or (d) is encumbered by an easement or other restriction required by the City limiting the use of such property to open space. “Outstanding Bonds” means all Bonds, which remain outstanding as defined in the Indenture pursuant to which such Bonds were issued.
“Pay as You Go Costs” means that portion of the Facilities Special Tax Requirement attributable to the direct payment for the acquisition and/or construction of public improvements, which are authorized to be financed by CFD No. 24 IA2A.
“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. “Planned Development” means the planned number of Residential Lots, MHD Multi-Family Attached Property Acreage, MMD Multi-Family Attached Property Acreage, and Non-Residential Property Acreage planned within CFD No. 24 IA2A, set forth in Attachment B or, following the Effective Tax Rate Evaluation, Attachment D of this Rate and Method of Apportionment, as amended by the future recordation of all Large Lot Maps and Small Lot Final Subdivision Maps within CFD No. 24 IA2A. “Price Point Study” means an analysis, prepared by an independent firm, to verify the estimated average sales price within each land use category of Residential Property given the project location and current market conditions.
“Property Owner Association Property” means any property within the boundaries of CFD No. 24 IA2A, which is (a) owned by a property owner association or (b) designated with specific boundaries

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and Acreage on a Small Lot Final Subdivision Map as property owner association property. As used in this definition, a property owner association includes any master or sub-association. “Proportionately” means for Taxable Property that the ratio of the Facilities Special Tax levy to the Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) and the Services Special Tax levy to the Maximum Services Special Tax is equal for all Assessors’ Parcels within each classification (Developed Property, Single Family Final Map Property, Permit Ready Multi- Family/Non-Residential Property, Large Lot Property, etc.) within CFD No. 24 IA2A. “Public Property” means any property within the boundaries of CFD No. 24 IA2A, which (a) is owned by a public agency, (b) has been irrevocably offered for dedication to a public agency, or (c) is designated with specific boundaries and Acreage on a Small Lot Final Subdivision Map as property, which will be owned by a public agency. For purposes of this definition, a public agency includes the federal government, the State of California, the County, the City, or any other public agency. “Residential Lot” means an individual lot of land for which a building permit could be issued to construct a Residential Unit.
“Residential Property” means, for each Fiscal Year, all Taxable Property for which a building permit could be issued for purposes of constructing Residential Units, including Single-Family Detached Property – SF/SFHD Zoning, Single-Family Detached Property – MLD Zoning, MHD Multi-Family Attached Property, and MMD Multi-Family Attached Property. “Residential Unit” means a residential dwelling unit, including Accessory Dwelling Units, as allowed by the City zoning code.
“Services Administrative Expenses” means the actual or reasonably estimated costs directly related to the administration of the Services Special Tax including, but not limited to, the following: the costs of computing the Services Special Taxes and preparing the annual Services Special Tax collection schedules (whether by the City or designee thereof or both); the costs of collecting the Services Special Taxes (whether by the County, the City, or otherwise); the costs associated with preparing Special Tax disclosure statements and responding to public inquiries regarding the Services Special Tax; and the costs of the City, CFD No. 24 IA2A, or any designee thereof related to any appeal of the levy or application of the Services Special Tax. Services Administrative Expenses shall also include amounts estimated or advanced by the City or CFD No. 24 IA2A for any other administrative purposes related to the Services Special Tax.
“Services Special Tax” means, prior to the Transition Event, the annual Special Tax to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property to fund the Services Special Tax Requirement.
“Services Special Tax Escalation Factor” means the maximum of two percent (2%) or the June annualized percentage change of the Consumer Price Index for all Urban Consumers, for the San Francisco-Oakland-San Jose area, not to exceed four percent (4%). “Services Special Tax Requirement” means the amount of Services Special Tax revenue required for CFD No. 24 IA2A, before the Transition Year, to (i) pay Services Administrative Expenses in an amount

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2A Page 7
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 CFD No. 24 IA2A Administrator.
“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 and 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 – SF/SFHD 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.
“Special Tax” means, before the Transition Year, 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.

Beginning in the Transition Year, the annual Transition Services Special Tax to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property to fund the Transition Services Special Tax Requirement.
“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. “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 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.
“Small Lot Final Subdivision Map” means a subdivision of property created by recordation of a final subdivision map, parcel map or lot line adjustment, approved by the City pursuant to the Subdivision

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2A Page 8
Map Act (California Government Code Section 66410 et seq.) or recordation of a condominium plan pursuant to California Civil Code 1352, that creates individual lots for which building permits may be issued for Residential Units without further subdivision of such property. “State” means the State of California.
“Taxable Property” means all of the Assessor’s Parcels within the boundaries of CFD No. 24 IA2A that are not exempt from the CFD No. 24 IA2A Special Tax pursuant to law or Section F below. “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 reflect the actual property tax rates levied upon Taxable Property in the Fiscal Year that the Effective Tax Rate Evaluation is completed.
“Transition Event” means the earlier of (i) Fiscal Year 2085-2086 or (ii) the Fiscal Year when the CFD No. 24 IA2A Administrator determines that both of the following events have occurred (1) all Bonds secured by the levy and collection of the Facilities Special Tax in CFD No. 24 IA2A have been fully repaid and the City determines that no additional Bonds are to be issued, and (2) all Facilities Administrative Expenses have been paid or reimbursed to CFD No. 24 IA2A. “Transition Services Administrative Expenses” means the actual or reasonably estimated costs directly related to the administration of the Transition Services Special Tax including, but not limited to, the following: the costs of computing the Transition Services Special Taxes and preparing the annual Transition Services Special Tax collection schedules (whether by the City or designee thereof or both); the costs of collecting the Transition Services Special Taxes (whether by the County, the City, or otherwise); the costs associated with preparing Special Tax disclosure statements and responding to public inquiries regarding the Transition Services Special Tax; and the costs of the City, CFD No. 24 IA2A, or any designee thereof related to any appeal of the levy or application of the Transition Services Special Tax. Transition Services Administrative Expenses shall also include amounts estimated or advanced by the City or CFD No. 24 IA2A for any other administrative purposes related to the Transition Services Special Tax.
“Transition Services Special Tax” means, after the Transition Event, the annual Special Tax to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property to fund the Transition Services Special Tax Requirement.
“Transition Services Special Tax Escalation Factor” means the maximum of two percent (2%) or the June annualized percentage change of the Consumer Price Index for all Urban Consumers, for the San Francisco-Oakland-San Jose area, not to exceed four percent (4%). “Transition Services Special Tax Rate” means, calculated in the Transition Year, the amount equal to the prior year’s Maximum Services Special Tax Rate plus fifty percent (50%) of the prior year’s

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City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2A Page 9
Maximum Facilities Special Tax Rate. The Transition Services Special Tax Escalation Factor shall be applied beginning in the Transition Year. Following the Transition Year, the Transition Services Special Tax Rate shall be equal to the prior year’s Transition Services Special Tax Rate, increased by the Transition Services Special Tax Escalation Factor.
“Transition Services Special Tax Requirement” Beginning in the Transition Year, to (i) pay Transition 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, replacement and contingency funds, capital improvement funds, or reserve funds related to the Authorized Services expenses; (iv) pay for reasonably anticipated delinquent Transition Services Special Taxes based on the delinquency rate for Transition Services Special Taxes levied in the previous Fiscal Year; less (v) a credit for funds available to reduce the annual Transition Services Special Tax levy as determined by the CFD No. 24 IA2A Administrator.
“Transition Year” means the first year in which the CFD No. 24 IA2A Administrator determines that the Transition Event occurred in the prior Fiscal Year. “Trustee” means the entity appointed pursuant to an Indenture to act as the trustee, fiscal agent, or paying agent or a combination thereof.
“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.
“Welfare Exempt Property” means, in any Fiscal Year, all Parcels within the boundaries of CFD No. 24 IA2A that (a) have been granted a welfare exemption by the County under subdivision (g) of Section 214 of the Revenue and Taxation Code indicated in the Assessor’s Data finalized as of January 1 of the previous Fiscal Year, and (b) are exempt from the Special Tax pursuant to Section 53340(c) of the Act.

Pursuant to Section 53340(c) of the Act, after the issuance of the first series of Bonds, as applicable, any Assessor’s Parcels that receives a welfare exemption under subdivision (g) of Section 214 of the Revenue and Taxation Code shall not be classified as Welfare Exempt Property and will be subject to the Facilities Special Tax.

B. ASSIGNMENT TO LAND USE CATEGORIES
Each Fiscal Year, using City and County records, City zoning information, and land use development plans, all Assessor’s Parcels within the boundaries of CFD No. 24 IA2A shall be designated as either Taxable Property or Exempt Property.

All Taxable Property shall 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 determined pursuant to Sections C and D below.

C. FACILITIES SPECIAL TAX

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City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2A Page 10
Prior to the Transition Year, a Maximum Facilities Special Tax shall be assigned to all Taxable Property within CFD No. 24 IA2A according to the Maximum Facilities Special Tax Rates set forth in Attachment A of this Rate and Method of Apportionment.

Once assigned, the sum of the total Maximum Facilities Special Tax shall be equal to or greater than the Minimum Facilities Revenue, unless adjusted by an Effective Tax Rate Evaluation as described below. The Minimum Facilities Revenue for Fiscal Year 2026-2027 is set forth in Attachment B of this Rate and Method of Apportionment.

On each July 1, commencing on July 1, 2027, the Maximum Facilities Special Tax Rates and Minimum Facilities Revenue shall be increased by the Facilities Special Tax Escalation Factor of the Maximum Facilities Special Tax Rates and Minimum Facilities Revenue in effect for the previous Fiscal Year.

C.1. Future Assessor’s Parcel Changes – Prior to an Effective Tax Rate Evaluation The 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 sum of the total Maximum Facilities Special Tax revenue is not less than the Minimum Facilities Revenue set forth in Attachment B of this Rate and Method of Apportionment.

Undeveloped Property Subdividing into Large Lot Property When Undeveloped Property subdivides into Large Lot Property, the Maximum Facilities Special Tax shall be calculated for all Taxable Property as if all of the Taxable Property was classified as Developed Property. The expected Developed Property Maximum Facilities Special Tax for any Large Lot Property and any remaining Undeveloped Property shall be based upon the Planned Development for the Large Lot Property and remaining Undeveloped Property.

If the sum of the total expected Developed Property Maximum Facilities Special Tax generated by all of the Taxable Property is greater than or equal to the Minimum Facilities Revenue, there will be no further adjustments to the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non-Residential Property Maximum Facilities Special Tax Rates for the Large Lot Property created from the Undeveloped Property subdivision.

If the sum of the total expected Developed Property Maximum Facilities Special Tax is less than the Minimum Facilities Revenue, the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non-Residential Property Maximum Facilities Special Tax Rates shall be Proportionately increased, on the Large Lot Property created from the Undeveloped Property subdivision, until the sum of the total expected Developed Property Maximum Facilities Special Tax is equal to the Minimum Facilities Revenue. Further, if the sum of the total current Maximum Facilities Special Tax is less than the Minimum Facilities Revenue, the Maximum Facilities Special Tax Rates for the Large Lot Property and any remaining Undeveloped Property created from the Undeveloped Property subdivision shall be Proportionately increased until the sum of the total current Maximum Facilities Special Tax is equal to the Minimum Facilities Revenue. Attachment B of this Rate and Method of Apportionment shall be updated to reflect any increases to the Maximum Facilities Special Tax Rates from the Undeveloped Property subdivision. The

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City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2A Page 11
Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non- Residential Property Maximum Facilities Special Tax Rates shall not be adjusted for any Taxable Property already classified as Developed Property, Small Lot Final Map Property or Permit Ready Multi-Family/Non-Residential Property.

Large Lot Property Subdividing into Small Lot Final Map Property and Permit Ready Multi- Family/Non-Residential Property
When Large Lot Property subdivides into Small Lot Final Map Property or Permit Ready Multi- Family/Non-Residential Property, the Maximum Facilities Special Tax shall be calculated for all Taxable Property as if all of the Taxable Property was classified as Developed Property. If the Large Lot Property subdivision also creates Small Lot Final Map Remainder Property, the expected Developed Property Maximum Facilities Special Tax for the Small Lot Final Map Remainder Property shall be based upon the Planned Development for the Small Lot Final Map Remainder Property. The expected Developed Property Maximum Facilities Special Tax for any remaining Large Lot Property and Undeveloped Property shall be based upon the Planned Development of the Large Lot Property and the Undeveloped Property.

If the sum of the total expected Developed Property Maximum Facilities Special Tax is greater than or equal to the Minimum Facilities Revenue, there will be no further adjustments to the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non- Residential Property Maximum Facilities Special Tax Rates for the Small Lot Final Map Property, Small Lot Final Map Remainder Property and Permit Ready Multi-Family/Non-Residential Property created from the Large Lot Property subdivision.

If the sum of the total expected Developed Property Maximum Facilities Special Tax is less than the Minimum Facilities Revenue, and such difference is not eliminated by the partial prepayment of the Effective Tax Rate Evaluation Maximum Facilities Special Tax pursuant to Section L, the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non- Residential Property Maximum Facilities Special Tax Rates shall be Proportionately increased, on the Small Lot Final Map Property, Small Lot Final Map Remainder Property and Permit Ready Multi-Family/Non-Residential Property created from the Large Lot Property subdivision, until the sum of the total expected Developed Property Maximum Facilities Special Tax is equal to the Minimum Facilities Revenue. Attachment B of this Rate and Method of Apportionment shall be updated to reflect any increases to the Maximum Facilities Special Tax Rates from the Large Lot Property subdivision. The Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non-Residential Property Maximum Facilities Special Tax Rates shall not be adjusted for any Taxable Property already classified as Developed Property, Small Lot Final Map Property or Permit Ready Multi-Family/Non-Residential Property created prior to the Large Lot Property subdivision.

C.2. Effective Tax Rate Evaluation
Prior to the issuance of the first series of Bonds within CFD No. 24 IA2A an Effective Tax Rate Evaluation will be completed. Following the Effective Tax Rate Evaluation, Attachment C of this

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Rate and Method of Apportionment will be updated to reflect the Effective Tax Rate Evaluation Maximum Facilities Special Tax Rate for all Taxable Property in CFD No. 24 IA2A.

Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates As part of the Effective Tax Rate Evaluation, a Price Point Study will be prepared and an estimated average sales prices will be established for each Residential Property land use category. Using the estimated average sales price information determined in the Price Point Study, the Total Estimated Tax Burden and Total Effective Tax Rate will be calculated, using the Developed Property Maximum Facilities Special Tax Rates set forth in Attachment A, for each Residential Property land use category. If the calculated Total Effective Tax Rate is less than or equal to the Total Maximum Effective Tax Rate for a Residential Property land use category, the Maximum Facilities Special Tax Rate shall not be adjusted and will be assigned using the Developed Property Maximum Facilities Special Tax Rates set forth in Attachment A. Attachment C of this Rate and Method of Apportionment will be updated to set forth the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rate for each Residential Property land use category.

If the Total Effective Tax Rate for any Residential Property land use category exceeds the Total Maximum Effective Tax Rate, the Developed Property Maximum Facilities Special Tax Rate set forth in Attachment A shall be reduced until the Total Effective Tax Rate is less than or equal to the Total Maximum Effective Tax Rate for that Residential Property land use category.

Attachment C of this Rate and Method of Apportionment will be updated to set forth the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rate for each Residential Property land use category.

Effective Tax Rate Evaluation Minimum Facilities Revenue As a result of the Effective Tax Rate Evaluation, if the calculated Total Effective Tax Rate is less than or equal to the Total Maximum Effective Tax Rate for a Residential Property land use category used in the Minimum Facilities Revenue calculation, the Developed Property Maximum Facilities Special Tax Rate for the applicable Residential Property land use category shall not be adjusted and the Effective Tax Rate Evaluation Developed Property Maximum Facilities Special Tax Rate will be assigned using the Developed Property Maximum Facilities Special Tax Rates set forth in Attachment B. Attachment D of this Rate and Method of Apportionment will be updated to set forth the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rate for each Residential Property land use category and the Effective Tax Rate Evaluation Minimum Facilities Revenue.

If the calculated Total Effective Tax Rate exceeds the Total Maximum Effective Tax Rate for a Residential Property land use category used in the Minimum Facilities Revenue calculation, the Effective Tax Rate Evaluation Developed Property Maximum Facilities Special Tax Rate will be assigned using the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates set forth in Attachment C. Attachment D of this Rate and Method of Apportionment will be updated to set forth the Developed Property Effective Tax Rate Evaluation Maximum

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Facilities Special Tax Rate for each Residential Property land use category and the Effective Tax Rate Evaluation Minimum Facilities Revenue.

C.3. Future Assessor’s Parcel Changes – After an Effective Tax Rate Evaluation 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 sum of the total Effective Tax Rate Evaluation Maximum Facilities Special Tax revenue is not less than the total Effective Tax Rate Evaluation Minimum Facilities Revenue set forth in Attachment D of this Rate and Method of Apportionment.

Undeveloped Property Subdividing into Large Lot Property When Undeveloped Property subdivides into Large Lot Property, the Effective Tax Rate Evaluation Maximum Facilities Special Tax shall be calculated for all Taxable Property as if all of the Taxable Property was classified as Developed Property. The expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax for any Large Lot Property and any remaining Undeveloped Property shall be based upon the Planned Development for the Large Lot Property and remaining Undeveloped Property.

If the sum of the total expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax generated by all of the Taxable Property is greater than or equal to the Effective Tax Rate Evaluation Minimum Facilities Revenue, there will be no further adjustments to the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non- Residential Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates for the Large Lot Property created from the Undeveloped Property subdivision.

If the sum of the total expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax is less than the Effective Tax Rate Evaluation Minimum Facilities Revenue, the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non- Residential Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates shall be Proportionately increased, on the Large Lot Property created from the Undeveloped Property subdivision, until the sum of the total expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax is equal to the Effective Tax Rate Evaluation Minimum Facilities Revenue. Further, if the sum of the total current Effective Tax Rate Evaluation Maximum Facilities Special Tax is less than the Effective Tax Rate Evaluation Minimum Facilities Revenue, the Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates for the Large Lot Property and any remaining Undeveloped Property created from the Undeveloped Property subdivision shall be Proportionately increased until the sum of the total current Effective Tax Rate Evaluation Maximum Facilities Special Tax is equal to the Effective Tax Rate Evaluation Minimum Facilities Revenue. Attachment D of this Rate and Method of Apportionment shall be updated to reflect any increases to the Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates from the Undeveloped Property subdivision. The Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non-Residential Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates shall not be adjusted for any Taxable Property already classified as

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2A Page 14
Developed Property, Small Lot Final Map Property or Permit Ready Multi-Family/Non-Residential Property.

Large Lot Property Subdividing into Small Lot Final Map Property and Permit Ready Multi- Family/Non-Residential Property
When Large Lot Property subdivides into Small Lot Final Map Property or Permit Ready Multi- Family/Non-Residential Property, the Effective Tax Rate Evaluation Maximum Facilities Special Tax shall be calculated for all Taxable Property as if all of the Taxable Property was classified as Developed Property. If the Large Lot Property subdivision also creates Small Lot Final Map Remainder Property, the expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax for the Small Lot Final Map Remainder Property shall be based upon the Planned Development for the Small Lot Final Map Remainder Property. The expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax for any remaining Large Lot Property and Undeveloped Property shall be based upon the Planned Development of the Large Lot Property and the Undeveloped Property.

If the sum of the total expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax is greater than or equal to the Effective Tax Rate Evaluation Minimum Facilities Revenue, there will be no further adjustments to the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non-Residential Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates for the Small Lot Final Map Property, Small Lot Final Map Remainder Property and Permit Ready Multi-Family/Non-Residential Property created from the Large Lot Property subdivision.

If the sum of the total expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax is less than the Effective Tax Rate Evaluation Minimum Facilities Revenue, and such difference is not eliminated by the partial prepayment of the Effective Tax Rate Evaluation Maximum Facilities Special Tax pursuant to Section L, the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non-Residential Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates shall be Proportionately increased, on the Small Lot Final Map Property, Small Lot Final Map Remainder Property and Permit Ready Multi- Family/Non-Residential Property created from the Large Lot Property subdivision, until the sum of the total expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax is equal to the Effective Tax Rate Evaluation Minimum Facilities Revenue. Attachment D of this Rate and Method of Apportionment shall be updated to reflect any increases to the Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates from the Large Lot Property subdivision. The Developed Property, Small Lot Final Map Property and Permit Ready Multi- Family/Non-Residential Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates shall not be adjusted for any Taxable Property already classified as Developed Property, Small Lot Final Map Property or Permit Ready Multi-Family/Non-Residential Property created prior to the Large Lot Property subdivision.

C.4. Method of Apportionment of Facilities Special Tax

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2A Page 15
Using the definitions and procedures described herein, the CFD No. 24 IA2A 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 until the Transition Year as follows:

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

Second: 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 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.

Third: 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 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.

Fourth: 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 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.

Fifth: 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 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.

After an Effective Tax Rate Evaluation
First: 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.

Second: 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.

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2A Page 16
Third: 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.

Fourth: 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.

Fifth: 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.

D. SERVICES SPECIAL TAX
A Services Special Tax shall be assigned to all Taxable Property within CFD No. 24 IA2A according to the Maximum Services Special Tax Rates set forth in Attachment A of this Rate and Method of Apportionment.

D.1. Prior to the Transition Event - Increase in the Maximum Services Special Tax Prior to the Transition Event, on each July 1, commencing on July 1, 2027, the Maximum Services Special Tax Rates shall be increased by the Services Special Tax Escalation Factor of the Maximum Services Special Tax Rates in effect for the previous Fiscal Year.

D.2. Prior to the Transition Event - Method of Apportionment of Services Special Tax If, in any Fiscal Year prior to the Transition Year, the Facilities Special Tax is levied against each Assessor’s Parcel of Taxable Property within CFD No. 24 IA2A and the Facilities Special Tax revenues generated are insufficient to pay the Facilities Special Tax Requirement such shortfall shall be deemed a component of the Services Special Tax Requirement in that Fiscal Year, and proceeds from the levy of the Services Special Tax shall first be applied to mitigate the shortfall in the Facilities Special Tax Requirement before being used to pay for Authorized Services. The Services Special Tax revenue shall not be applied to any Facilities Special Tax Requirement shortfalls attributable to Pay As You Go Costs authorized to be financed by CFD No. 24 IA2A.

Using the definitions and procedures described herein, the CFD No. 24 IA2A Administrator shall determine the Services Special Tax Requirement and levy the Services Special Tax until the amount of Services Special Tax equals the Services Special Tax Requirement. The Services Special Tax shall be levied each Fiscal Year as follows:

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2A Page 17
First: 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.

Second: 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 100% of the Maximum Services Special Tax in order to satisfy the Services Special Tax Requirement.

Third: 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 100% of the Maximum Services Special Tax in order to satisfy the Services Special Tax Requirement.

Fourth: If additional monies are needed to satisfy the Services Special Tax Requirement after the 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.

Fifth: If additional monies are needed to satisfy the Services Special Tax Requirement after the three steps have been completed, the Services Special Tax shall be levied Proportionately on all Undeveloped Property at a rate up to 100% of the Maximum Services Special Tax in order to satisfy the Services Special Tax Requirement.

E. TRANSITION SERVICES SPECIAL TAX
A Transition Services Special Tax shall be assigned to all Taxable Property within CFD No. 24 IA2A according to the Maximum Transition Services Special Tax Rates set forth in Attachment A of this Rate and Method of Apportionment.

E.1. After the Transition Event – Method of Apportionment of Transition Services Special Tax Using the definitions and procedures described herein, the CFD No. 24 IA2A Administrator shall determine the Transition Services Special Tax Requirement and levy the Transition Services Special Tax until the amount of Transition Services Special Tax equals the Transition Services Special Tax Requirement. The Transition Services Special Tax shall be levied each Fiscal Year as follows:

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

Second: If additional monies are needed to satisfy the Transition Services Special Tax Requirement after the first step has been completed, the Transition Services Special Tax shall be levied Proportionately on all Small Lot Final Map Property at a rate up to 100% of the Maximum Transition Services Special Tax in order to satisfy the Transition Services Special Tax Requirement.

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2A Page 18
Third: If additional monies are needed to satisfy the Transition Services Special Tax Requirement after the first two steps have been completed, the Transition Services Special Tax shall be levied Proportionately on all Permit Ready Multi-Family/Non-Residential Property at a rate up to 100% of the Maximum Transition Services Special Tax in order to satisfy the Transition Services Special Tax Requirement.

Fourth: If additional monies are needed to satisfy the Transition Services Special Tax Requirement after the three steps have been completed, the Transition Services Special Tax shall be levied Proportionately on all Large Lot Property at a rate up to 100% of the Maximum Transition Services Special Tax in order to satisfy the Transition Services Special Tax Requirement.

Fifth: If additional monies are needed to satisfy the Transition Services Special Tax Requirement after the three steps have been completed, the Transition Services Special Tax shall be levied Proportionately on all Undeveloped Property at a rate up to 100% of the Maximum Transition Services Special Tax in order to satisfy the Transition Services Special Tax Requirement.

F. DELINQUENCIES
Notwithstanding the above, under no circumstances will the CFD No. 24 IA2A Facilities Special Tax levied against any Assessor’s Parcel of Developed Property classified as Residential Property, in any Fiscal Year, be increased as a consequence of the delinquency or default in the payment of the CFD No. 24 IA2A Facilities Special Taxes by the owner or owners of any other Taxable Property by more than ten percent (10%) above the amount that would have been levied against such Assessor’s Parcel in such Fiscal Year had there been no delinquencies or defaults.

G. EXEMPTIONS
The CFD No. 24 IA2A Administrator shall classify the following as Exempt Property: Public Property, Property Owner Association Property, Open Space Property, and Assessor’s Parcels with public or utility easements making impractical their utilization for any use other than the purposes set forth in the easement.

The Maximum Facilities Special Tax obligation or, if applicable, the Effective Tax Rate Evaluation Maximum Facilities Special Tax obligation for Taxable Property which will be transferred or dedicated to a public agency and will be classified as Public Property may be fully prepaid by the seller, pursuant to Section L, prior to the transfer/dedication of such Taxable Property. Until the Maximum Facilities Special Tax obligation or, if applicable, the Effective Tax Rate Evaluation Maximum Facilities Special Tax obligation for any such Taxable Property is prepaid, the Taxable Property shall continue to be subject to the levy of the Facilities Special Tax. An exception to this may be made if an Assessor’s Parcel of Public Property, such as a school site, is relocated to an Assessor’s Parcel of Taxable Property, in which case the Assessor’s Parcel of previously Public Property becomes Taxable Property and the Assessor’s Parcel of previously Taxable Property becomes Public Property. This trading of an Assessor’s Parcel from Taxable Property to Public Property will be permitted to the extent there is no loss in Maximum Facilities Special Tax revenue or, if applicable, Effective Tax Rate Evaluation Maximum Facilities Special Tax revenue, and the transfer is agreed to by the owners of all Assessor’s Parcels involved in the transfer and the City Council.

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2A Page 19
If the use of an Assessor’s Parcel changes so that such Assessor’s Parcel is no longer eligible to be classified as one of the uses set forth in Section G.1. above that would make such Assessor’s Parcel eligible to continue to be classified as Exempt Property, such Assessor’s Parcel shall cease to be classified as Exempt Property and shall be deemed to be Taxable Property and subject to the Special Tax.

No Special Tax shall be levied on any Assessor’s Parcel in any Fiscal Year in which such Assessor’s Parcel is classified as Welfare Exempt Property; however, pursuant to Section 53340(c) of the Act, after the issuance of the first series of Bonds, as applicable, any Assessor’s Parcel that receives a welfare exemption under subdivision (g) of Section 214 of the Revenue and Taxation Code shall not be classified as Welfare Exempt Property and will be subject to the Facilities Special Tax.

H. TRANSFERS
Prior to the issuance of the first series of Bonds within CFD No. 24 IA2A, the City may permit the transfer of Maximum Facilities Special Tax or Effective Tax Rate Evaluation Maximum Facilities Special Tax from one Assessor’s Parcel to another Assessor’s Parcel. Before recordation of a Small Lot Final Subdivision Map, if a subdivision map is required, the City may permit a transfer if the number of planned Residential Units, Multi-Family Attached Property Acreage, or Non-Residential Property Acreage is transferred from one Assessor’s Parcel(s) to another Assessor’s Parcel(s) in any portion of Large Lot Property. The City may, in its sole discretion, allow for a transfer of the Maximum Facilities Special Tax or Effective Tax Rate Evaluation Maximum Facilities Special Tax from one Assessor’s Parcel to another Assessor’s Parcel provided such a transfer shall be allowed only if (1) all adjustments are agreed to in writing by the affected property owners and the City’s Finance Director, and (2) there is no reduction in the sum of the total Maximum Facilities Special Tax or sum of the total Effective Tax Rate Evaluation Maximum Facilities Special Tax as a result of the transfer. Should a transfer result in an amendment to Attachment B or, following an Effective Tax Rate Evaluation, Attachment D of this Rate and Method of Apportionment, the requesting property owner shall bear the costs to affect the transfer in the CFD No. 24 IA2A records and prepare the required amendments to Attachment B or, following an Effective Tax Rate Evaluation, Attachment D of this Rate and Method of Apportionment.

I. INTERPRETATIONS
The City reserves the right to make minor administrative and technical changes to this document that do not materially affect the Rate and Method of Apportionment of Special Tax. In addition, the interpretation and application of any section of this document shall be at the City’s discretion.

Interpretations may be made by the City by ordinance or resolution for purposes of clarifying any vagueness or ambiguity in this Rate and Method of Apportionment of Special Tax.

J. REVIEW/APPEALS
The CFD No. 24 IA2A Administrator may establish such procedures, as it deems necessary to undertake the review of any such appeal. The CFD No. 24 IA2A Administrator shall interpret this Rate and Method of Apportionment of Special Tax and make determinations relative to the annual administration of the Special Tax and any property owner appeals, as herein specified.

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2A Page 20
Any property owner may file a written appeal of the Special Tax with the CFD No. 24 IA2A Administrator claiming that the amount or application of the Special Tax is not correct. The appeal must be filed not later than one calendar year after having paid the Special Taxes that are disputed, and the appellant must be current in all payments of Special Taxes. In addition, during the term of the appeal process, all Special Taxes levied must be paid on or before the payment date established when the levy was made. The appeal must specify the reasons why the appellant claims the Special Taxes are in error. The CFD No. 24 IA2A Administrator shall review the appeal, meet with the appellant if the CFD No. 24 IA2A Administrator deems necessary, and advise the appellant of its determination.

If the property owner disagrees with the CFD No. 24 IA2A Administrator’s decision relative to the appeal, the owner may file a written notice with the City Manager appealing the amount of the Special Tax levied on such Assessor’s Parcel. If following such consultation and action (if any by the City Manager), the property owner believes such error still exists, such person may file a written notice with the City Council appealing the amount of the Special Tax levied on such Assessor’s Parcel. The decision of the City shall be final and binding to all persons. If the decision of the CFD No. 24 IA2A Administrator or subsequent decision by the City Manager or City Council requires the Special Taxes to be modified or changed in favor of the property owner, no cash refund shall be made for prior years’ Special Taxes, but an adjustment shall be made to credit future Special Taxes. This procedure shall be exclusive and its exhaustion by any property owner shall be a condition precedent to filing any legal action by such owner.

K. MANNER OF COLLECTION
The annual Special Tax shall be collected in the same manner and at the same time as ordinary ad valorem property taxes; provided, however, that CFD No. 24 IA2A, may, at the sole discretion of the City, directly bill the Special Tax, may collect Special Taxes at a different time or in a different manner as necessary to meet its financial obligations, and may covenant to foreclose and may actually foreclose on Assessor’s Parcels of Taxable Property that are delinquent in the payment of Special Taxes.

L. PREPAYMENT IN PART OF FACILITIES SPECIAL TAX
The Facilities Special Tax obligation of an Assessor’s Parcel of Taxable Property may be partially prepaid as described herein; provided that there are no delinquent Special Taxes with respect to such Assessor’s Parcel at the time of partial prepayment. An owner of an Assessor’s Parcel intending to partially prepay the Facilities Special Tax obligation shall provide the CFD No. 24 IA2A Administrator with written notice of intent to partially prepay. Within 30 days of receipt of such written notice, the CFD No. 24 IA2A Administrator shall notify such owner of the partial prepayment amount of such Assessor’s Parcel. Any partial prepayment must be submitted at least 60 days before the next occurring bond redemption date, and the proceeds of such prepayment shall be provided to the Trustee for application toward bond redemption in accordance with the Indenture. The CFD No. 24 IA2A Administrator may charge a fee for providing this service.

L.1. Partial Prepayment Amount

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2A Page 21
The Facilities Special Tax may be prepaid in an amount determined at the time of prepayment based on the portion of Bonds then outstanding; provided, however, that no partial prepayment shall be accepted in an amount equal to an annual Special Tax amount less than the annual Transition Services Special Tax rate escalated to the then current fiscal year less the then current Services Special Tax rate.

Step 1: Determine the current Fiscal Year Maximum Facilities Special Tax for the Assessor’s Parcel based on the assignment of the Maximum Facilities Special Tax described in Section C above. If an Effective Tax Rate Evaluation has occurred, determine the current Fiscal Year Effective Tax Rate Evaluation Maximum Facilities Special Tax for the Assessor’s Parcel based on the assignment of the Effective Tax Rate Evaluation Maximum Facilities Special Tax described in Section C above.

If the Assessor’s Parcel is not already classified as Developed Property, the Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) shall be assigned as though the Assessor’s Parcel was already designated as Developed Property.

Step 2: Calculate the annual revenue produced, by annually applying the Facilities Special Tax Escalation Factor, from the Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) from the date of prepayment through the earlier of the end of the Facilities Special Tax Term or the Transition Event, except that this final date may be amended by the City no later than the time of the calculation of the prepayment. If the final date used in the prepayment calculation is amended by the City, this amended final date shall apply to any and all prepayment calculations from that point forward.

Step 3: Calculate the present value of the Assessor’s Parcel’s annual Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) revenue stream determined in Step 2. The present value shall be calculated using a discount rate that earns a rate of interest that, when the prepayment is invested in City permitted and available investments, would produce annual revenues equal to the amounts calculated in Step 2.

If there are Outstanding Bonds at the time of the Partial Prepayment Amount calculation, the Partial Prepayment Amount shall be first allocated to the Redemption Amount. If the Partial Prepayment Amount is insufficient to fund the Redemption Amount, then the Partial Prepayment Amount shall be increased to equal the Redemption Amount.

The Redemption Amount is calculated as follows:

Step 1: Divide the Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) computed pursuant to Step 1 of Section L.1 by the total Maximum Facilities Special Taxes (or total Effective Tax Rate Evaluation Maximum Facilities Special Taxes) for the entire CFD No. 24 IA2A, based on the Maximum Facilities Special Taxes (or Effective Tax Rate Evaluation Maximum Facilities Special Taxes) that could be charged in the current Fiscal Year if all Taxable Property were designated as Developed Property, excluding any Assessor’s Parcels which have prepaid the Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) obligation (the “Prepayment Quotient”).

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City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2A Page 22
Step 2: Multiply the Prepayment Quotient by the Outstanding Bonds to compute the amount of Outstanding Bonds to be redeemed (the “Bond Redemption Amount”).

Step 3: Multiply the Bond Redemption Amount by the applicable redemption premium, if any, on the Outstanding Bonds to be redeemed.

Step 4: Compute the amount needed to pay interest on the Bond Redemption Amount from the first Bond interest payment date following the current Fiscal Year until the earliest redemption date for the Outstanding Bonds.

Step 5: Determine that portion of Facilities Special Taxes levied on the Assessor’s Parcel in the current Fiscal Year to satisfy the Facilities Special Tax Requirement, which have not yet been paid.

Step 6: A reserve fund credit shall equal the lesser of: (a) the expected reduction in the reserve requirement (as defined in the Indenture for the Bonds), if any, associated with the redemption of Outstanding Bonds as a result of the partial prepayment, or (b) the amount derived by subtracting the new reserve requirement (as defined in the Indenture for the Bonds) in effect after the redemption of Outstanding Bonds as a result of the partial prepayment from the balance in the reserve fund on the prepayment date, but in no event shall such amount be less than zero. Such reserve fund credit will not decrease the balance in the reserve fund below the new reserve requirement.

Step 7: If any capitalized interest for the Outstanding Bonds will not have been expended at the time of the first interest and/or principal payment following the current Fiscal Year, a capitalized interest credit shall be calculated by multiplying the quotient computed pursuant to Step 1 by the expected balance in the capitalized interest fund after such first interest payment.

Step 8: The redemption amount is equal to the sum of the amounts computed pursuant to Steps 2, 3, 4, and 5, less the amount computed pursuant to Steps 6 and 7 (the “Redemption Amount”).

If the Partial Prepayment Amount exceeds the Redemption Amount, then any remaining Partial Prepayment Amount, after allocating the Redemption Amount, shall be designated as Pay as You Go Costs.

The Partial Prepayment Amount shall include any fees or expenses, including the costs of computation of the prepayment, the costs to invest the prepayment proceeds, the cost of redeeming Bonds, and the costs of recording any notices to evidence the prepayment and the redemption (the “Administrative Fees and Expenses”).

In addition, the City has the authority to adjust the Partial Prepayment Amount calculated above if a portion or all of the current property tax bill and the portion attributable to the payment of the Facilities Special Tax has not been used to make an interest and/or principal payment on the Bonds.

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2A Page 23
Notwithstanding the foregoing, no partial prepayment shall be allowed unless the amount of Maximum Facilities Special Taxes (or Effective Tax Rate Evaluation Maximum Facilities Special Taxes), net of any priority administration, if any as defined in the Bond documents, that may be levied on Taxable Property, in each Fiscal Year, both prior to and after the proposed partial prepayment, is at least 1.1 times the annual debt service on all Outstanding Bonds to be paid from the Maximum Facilities Special Taxes (or Effective Tax Rate Evaluation Maximum Facilities Special Taxes) in each Fiscal Year.

M. TERM OF SPECIAL TAX
The Maximum Facilities Special Tax and Effective Tax Rate Evaluation Maximum Facilities Special Tax shall be levied commencing in Fiscal Year 2026-2027 to the extent necessary to fully satisfy the Facilities Special Tax Requirement and shall be levied for the Facilities Special Tax Term.

The Maximum Services Special Tax shall be levied commencing in Fiscal Year 2026-2027 and shall be levied until the Transition Event to the extent necessary to fully satisfy the Services Special Tax Requirement.

The Maximum Transition Services Special Tax shall be levied commencing in the Fiscal Year following the Transition Event in perpetuity, unless and until such time the City determines that revenues are no longer needed to pay the Transition Services Special Tax Requirement.

including Single-Family Detached Property – SF/SFHD Zoning, Single-Family Detached Property – MLD Zoning, MHD Multi-Family Attached Property, and MMD Multi-Family Attached Property.

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2A Page 24

ATTACHMENT A

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 24 (ALDER CREEK WEST) IMPROVEMENT AREA 2A

MAXIMUM SPECIAL TAX RATES
(FISCAL YEAR 2026-2027)
Land Use Category Lot / Village #
2026-2027
Maximum
Facilities Special
Tax Rate(1)
2026-2027
Maximum
Services Special
Tax Rate(2) Taxed Per
Developed Property:

Multi-Family Attached Property – MLD Zoning 1A $2,547 $450 Residential Lot Multi-Family Attached Property – MLD Zoning 1B 2,598 470 Residential Lot Multi-Family Attached Property – MLD Zoning 1C 2,498 400 Residential Lot Small Lot Final Map Property:

Multi-Family Attached Property – MLD Zoning 1A $2,547 $450 Residential Lot Multi-Family Attached Property – MLD Zoning 1B 2,598 470 Residential Lot Multi-Family Attached Property – MLD Zoning 1C 2,498 400 Residential Lot Permit Ready Multi-Family/Non-Residential Property $23,000 N/A Acre Large Lot Property $23,000 N/A Acre
Undeveloped Property $23,000 N/A Acre
(1) On each July 1, commencing on July 1, 2027, the Maximum Facilities Special Tax Rates shall be increased by the Facilities Special Tax Escalation Factor of the Maximum Facilities Special Tax Rates in effect for the previous Fiscal Year. (2) On each July 1, commencing on July 1, 2027, the Maximum Services Special Tax Rates shall be increased by an amount equal to the Services Special Tax Escalation Factor of the Maximum Services Special Tax Rates in effect for the previous Fiscal Year.

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2A Page 25

ATTACHMENT B

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 24 (ALDER CREEK WEST) IMPROVEMENT AREA 2A

MINIMUM FACILITIES REVENUE
(FISCAL YEAR 2026-2027)
Land Use Category Lot / Village #
Planned Number
of Residential
Lots / Acres
2026-2027
Developed Property
Maximum Facilities
Special Tax Rate(1)(2)
2026-2027
Minimum
Facilities
Revenue (1)(3)
Developed Property:

Multi-Family Attached Property – MLD Zoning 1A 104 $2,547 $264,888 Multi-Family Attached Property – MLD Zoning 1B 101 2,598 262,398 Multi-Family Attached Property – MLD Zoning 1C 124 2,498 309,752 Total Minimum Facilities Revenue(4) $837,038
(1) On each July 1, commencing on July 1, 2027, the Developed Property Maximum Facilities Special Tax Rates and Minimum Facilities Revenue shall be increased by the Facilities Special Tax Escalation Factor of the Developed Property Maximum Facilities Special Tax Rates and Minimum Facilities Revenue in effect for the previous Fiscal Year. (2) As a result of future Assessor’s Parcel changes, described in Section C.1, the assigned Maximum Facilities Special Tax Rates for Developed Property may exceed the Developed Property Maximum Facilities Special Tax Rates set forth in this table. (3) The total Minimum Facilities Revenue may be decreased as result of a portion of Maximum Facilities Special Tax obligations being prepaid pursuant to Section L.
(4) Based upon the Developed Property Maximum Facilities Special Tax Rate for Single-Family Detached Property in Lot/Village 1A, 1B, and 1C.

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ATTACHMENT C

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 24 (ALDER CREEK WEST) IMPROVEMENT AREA 2A

EFFECTIVE TAX RATE EVALUATION MAXIMUM FACILITIES SPECIAL TAX RATES (FISCAL YEAR 2026-2027)
Land Use Category Lot / Village #
2026-2027
Effective Tax Rate
Evaluation Maximum
Facilities Special Tax
Rate(1)(2) Taxed Per
Developed Property:

Multi-Family Attached Property – MLD Zoning 1A $_________ Residential Lot Multi-Family Attached Property – MLD Zoning 1B _________ Residential Lot Multi-Family Attached Property – MLD Zoning 1C _________ Residential Lot Small Lot Final Map Property:

Multi-Family Attached Property – MLD Zoning 1A $_________ Residential Lot Multi-Family Attached Property – MLD Zoning 1B _________ Residential Lot Multi-Family Attached Property – MLD Zoning 1C _________ Residential Lot Permit Ready Multi-Family/Non-Residential Property $_________ Acre Large Lot Property $_________ Acre
Undeveloped Property $_________ Acre
(1) Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates will be inserted following the Effective Tax Rate Evaluation. (2) On each July 1, commencing in the Fiscal Year after the Effective Tax Rate Evaluation occurs, the Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates shall be increased by the Facilities Special Tax Escalation Factor of the Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates in effect for the previous Fiscal Year.

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ATTACHMENT D

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 24 (ALDER CREEK WEST) IMPROVEMENT AREA 2A

EFFECTIVE TAX RATE EVALUATION MINIMUM FACILITIES REVENUE (FISCAL YEAR 2026-2027)

Land Use Category Lot / Village #
Planned Number
of Residential
Lots / Acres(1)
2026-2027
Developed Property
Effective Tax Rate
Evaluation Maximum
Facilities Special Tax
Rate(1)(2)(3)
2026-2027
Effective Tax Rate
Evaluation
Minimum Facilities
Revenue(1)(2)(4)
Developed Property:

Multi-Family Attached Property – MLD Zoning 1A 104 $_________ $_________ Multi-Family Attached Property – MLD Zoning 1B 101 _________ _________ Multi-Family Attached Property – MLD Zoning 1C 124 _________ _________ Total Effective Tax Rate Evaluation Minimum
Facilities Revenue(5)
$_________
(1) Planned Number of Residential Units/Acres, Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rate and Effective Tax Rate Evaluation Minimum Facilities Revenue to be inserted following the Effective Tax Rate Evaluation. (2) On each July 1, commencing in the Fiscal Year after the Effective Tax Rate Evaluation occurs, the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates and Effective Tax Rate Evaluation Minimum Facilities Revenue shall be increased by the Facilities Special Tax Escalation Factor of the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates and Effective Tax Rate Evaluation Minimum Facilities Revenue in effect for the previous Fiscal Year. (3) As a result of future Assessor’s Parcel changes, described in Section C.3, the assigned Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates may exceed the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates set forth in this table.
(4) The total Effective Tax Rate Evaluation Minimum Facilities Revenue may be decreased as result of a portion of Effective Tax Rate Evaluation Maximum Facilities Special Tax obligations being prepaid pursuant to Section L. (5) Based upon the Developed Property Maximum Facilities Special Tax Rate for Single-Family Detached Property in Lot/Village 1A, 1B, and 1C.

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ATTACHMENT E

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 24 (ALDER CREEK WEST) IMPROVEMENT AREA 2A

MAP OF VILLAGES

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City of Folsom
Community Facilities District No. 24 (Alder Creek West) Public Hearing Report D APPENDIX D: RATE AND METHOD OF APPORTIONMENT –
IA 2B
The following pages provide a copy of the Rate and Method of Apportionment for IA 2B.

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RATE AND METHOD OF APPORTIONMENT FOR

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 24
(ALDER CREEK WEST)
IMPROVEMENT AREA 2B
A Special Tax, as hereinafter defined, shall be levied on each Assessor's Parcel of Taxable Property within the City of Folsom Community Facilities District No. 24 (Alder Creek West) Improvement Area 2B (CFD No. 24 IA2B) and collected each Fiscal Year in an amount determined by the CFD No. 24 IA2B Administrator through the application of the Rate and Method of Apportionment as described below. All of the real property within CFD No. 24 IA2B, unless exempted by law or by the provisions hereof, shall be taxed for the purposes, to the extent and in the manner herein provided.

A. GENERAL DEFINITIONS
The terms hereinafter set forth have the following meaning:
“Accessory Dwelling Unit” or “ADU” means a secondary residential unit of limited size, as defined in California Government Code Section 66313, as may be amended from time to time, that is accessory to a single-unit dwelling. The ADU may be on the same Assessor’s Parcel as the single-unit dwelling or on a separate Assessor’s Parcel. For purposes of clarification, where an ADU and primary Unit are on the same Assessor’s Parcel, the ADU located on such Assessor’s Parcel is considered a separate Unit from the primary Unit on such Assessor’s Parcel for purposes of the Special Tax. Should an Assessor’s Parcel contain only an ADU, such Assessor’s Parcel will be taxed as an ADU only. “Acre” or “Acreage” means the land area of an Assessor’s Parcel as shown on County records, such as an Assessor’s Parcel Map and secured roll data, or if the land area is not shown on an Assessor’s Parcel Map, the land area shown on the applicable Large Lot Map, Small Lot Final Subdivision Map, condominium plan, record of survey, or other recorded document creating or describing the parcel.

If the preceding maps for a land area are not available, the Acreage of such land area may be determined utilizing available spatial data and GIS. The square footage of an Assessor’s Parcel is equal to the Acreage of such parcel multiplied by 43,560.
“Act” means the Mello-Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Division 2 of Title 5 of the Government Code of the State of California. “Assessor’s Parcel” or “Parcel” means a lot or parcel shown in an Assessor’s Parcel Map with an assigned Assessor’s Parcel number.
“Assessor’s Parcel Map” means an official map of the County Assessor of the County designating lots or parcels by an Assessor’s Parcel number.
“Authorized Services” means the services authorized to be financed by CFD No. 24 IA2B. “Bond Year” means a one-year period beginning on September 2nd in each year and ending on September 1st in the following year, unless defined differently in the applicable Indenture. “Bonds” means any bonds or other debt (as defined in the Act), whether in one or more series, issued by CFD No. 24 IA2B under the Act.

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“CFD No. 24 IA2B” means City of Folsom Community Facilities District No. 24 (Alder Creek West) Improvement Area 2B.
“CFD No. 24 IA2B Administrator” means the City’s Finance Director, or designee thereof, responsible for determining the Facilities Special Tax Requirement, Services Special Tax Requirement and providing for the levy and collection of the Special Taxes. “City” means the City of Folsom.
“City Council” means the City Council of the City, acting as the legislative body of CFD No. 24 IA2B. “County” means the County of Sacramento.
“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. “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.
“Effective Tax Rate Evaluation Maximum Facilities Special Tax” means the total maximum annual Facilities Special Tax, as determined during the Effective Tax Rate Evaluation, in accordance with the provisions of Section C.2, which may be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.
“Effective Tax Rate Evaluation Maximum Facilities Special Tax Rate” means the maximum annual Facilities Special Tax rate for each land use category of Taxable Property that will be set forth in Attachment C, following 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 Minimum Facilities Revenue” means, following the Effective Tax Rate Evaluation, the total minimum amount of CFD No. 24 IA2B 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 partially prepaid pursuant to Section L. The Effective Tax Rate Evaluation Minimum Facilities Revenue, based on Planned Development, is set forth in Attachment D of this Rate and Method of Apportionment.
“Exempt Property” means all Assessors’ Parcels that are exempt from the Special Tax pursuant to Section F.
“Facilities Administrative Expenses” means the actual or reasonably estimated costs directly related to the administration of the Facilities Special Tax including, but not limited to, the following: the costs of computing the Facilities Special Tax and preparing the annual Facilities Special Tax collection schedules (whether by the City or designee thereof or both); the costs of collecting the Facilities Special Taxes (whether by the County, the City, or otherwise); the costs of remitting the Facilities Special Taxes to the Trustee; the costs of the Trustee (including its legal counsel) in the discharge of

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the duties required of it under the Indenture; the costs to the City, CFD No. 24 IA2B, or any designee thereof of complying with arbitrage rebate requirements or responding to questions from the IRS or SEC pertaining to any Bonds or any audit of any Bonds by the SEC or IRS; the costs to the City, CFD No. 24 IA2B, or any designee thereof of providing continuing disclosure regarding the Bonds pursuant to applicable state or federal securities law; the costs associated with preparing Facilities Special Tax disclosure statements and responding to public inquiries regarding the Facilities Special Taxes; the costs of the City, CFD No. 24 IA2B, or any designee thereof related to any appeal of the levy or application of the Facilities Special Tax; the costs associated with the release of funds from an escrow account, if any; and the costs associated with computing and preparing the Effective Tax Rate Evaluation, including the Price Point Study. Facilities Administrative Expenses shall also include amounts estimated or advanced by the City or CFD No. 24 IA2B for any other administrative purposes, including, but not limited to, attorney’s fees and other costs related to commencing and pursuing to completion any foreclosure of delinquent Facilities Special Taxes. “Facilities Special Tax” means 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. “Facilities Special Tax Escalation Factor” means two percent (2%) annually. “Facilities Special Tax Requirement” means that amount of Special Tax revenue required in any Fiscal Year for CFD No. 24 IA2B 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 CFD No. 24 IA2B Administrator pursuant to the Indenture. “Facilities Special Tax Term” means the earlier of Fiscal Year 2085-2086 or the Fiscal Year occurring 50 years following the Fiscal Year in which the first building permit was issued, or the first series of Bonds was issued within CFD No. 24 IA2B.
“Fiscal Year” means the period starting July 1 and ending on the following June 30. “Indenture” means the indenture, fiscal agent agreement, trust agreement, resolution or other instrument pursuant to which Bonds are issued, as modified, amended and/or supplemented from time to time, and any instrument replacing or supplementing the same. “Large Lot Map” means a recorded subdivision map creating larger parcels by land use. The Large Lot Map does not create individual lots for which building permits may be issued for single-family Residential Units.
“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

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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. “Maximum Facilities Special Tax” means the total maximum annual Facilities Special Tax, determined in accordance with the provisions of Section C, which may be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.
“Maximum Facilities Special Tax Rate” means the maximum annual Facilities Special Tax rate for each land use category of Taxable Property, as shown in Attachment A, which may be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.
“Maximum Services Special Tax” means the total maximum annual Services Special Tax, determined in accordance with the provisions of Section D, which may be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.
“Maximum Services Special Tax Rate” means the maximum annual Services Special Tax rate for each land use category of Taxable Property, as shown in Attachment A, which may be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.
“Maximum Special Tax” means, prior to the Transition Year, the total annual Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) and Maximum Services Special Tax, determined in accordance with the provisions of Section C and Section D, which may be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.

Beginning in the Transition Year, “Maximum Special Tax”, means the total annual Maximum Transition Services Special Tax, determined in accordance with the provisions of Section D, which may be levied in any Fiscal Year following the Transition Event on any Assessor’s Parcel of Taxable Property “Maximum Total Effective Tax Rate” means 1.80%, unless the City determines, in its sole discretion, that a higher Maximum Total Effective Tax Rate is appropriate. “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 and 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. “Minimum Facilities Revenue” means the minimum amount of total CFD No. 24 IA2B Maximum Facilities Special Tax, as adjusted annually by the Facilities Special Tax Escalation Factor, less any Maximum Facilities Special Tax amounts partially prepaid pursuant to Section L. The Minimum Facilities Revenue, based on Planned Development, is set forth in Attachment B of this Rate and Method of Apportionment. Following the Transition Event, the Minimum Facilities Revenue shall be zero.
“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

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Parcel with a permitted density range of 12-20 Residential Units per Acre and more fully described in the Folsom Plan Area Specific Plan adopted on June 28, 2011 and as amended by the City Council. “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. “Open Space Property” means property within the boundaries of CFD No. 24 IA2B which (a) has been designated with specific boundaries and acreage on a Small Lot Final Subdivision Map as open space, or (b) is classified by the City zoning code or County Assessor as open space, or (c) has been irrevocably offered for dedication as open space to the federal government, the State of California, the County, the City, any other public agency, a private, non-profit organization, or (d) is encumbered by an easement or other restriction required by the City limiting the use of such property to open space. “Outstanding Bonds” means all Bonds, which remain outstanding as defined in the Indenture pursuant to which such Bonds were issued.
“Pay as You Go Costs” means that portion of the Facilities Special Tax Requirement attributable to the direct payment for the acquisition and/or construction of public improvements, which are authorized to be financed by CFD No. 24 IA2B.
“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. “Planned Development” means the planned number of Residential Lots, MHD Multi-Family Attached Property Acreage, MMD Multi-Family Attached Property Acreage, and Non-Residential Property Acreage planned within CFD No. 24 IA2B, set forth in Attachment B or, following the Effective Tax Rate Evaluation, Attachment D of this Rate and Method of Apportionment, as amended by the future recordation of all Large Lot Maps and Small Lot Final Subdivision Maps within CFD No. 24 IA2B. “Price Point Study” means an analysis, prepared by an independent firm, to verify the estimated average sales price within each land use category of Residential Property given the project location and current market conditions.
“Property Owner Association Property” means any property within the boundaries of CFD No. 24 IA2B, which is (a) owned by a property owner association or (b) designated with specific boundaries

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and Acreage on a Small Lot Final Subdivision Map as property owner association property. As used in this definition, a property owner association includes any master or sub-association. “Proportionately” means for Taxable Property that the ratio of the Facilities Special Tax levy to the Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) and the Services Special Tax levy to the Maximum Services Special Tax is equal for all Assessors’ Parcels within each classification (Developed Property, Single Family Final Map Property, Permit Ready Multi- Family/Non-Residential Property, Large Lot Property, etc.) within CFD No. 24 IA2B. “Public Property” means any property within the boundaries of CFD No. 24 IA2B, which (a) is owned by a public agency, (b) has been irrevocably offered for dedication to a public agency, or (c) is designated with specific boundaries and Acreage on a Small Lot Final Subdivision Map as property, which will be owned by a public agency. For purposes of this definition, a public agency includes the federal government, the State of California, the County, the City, or any other public agency. “Residential Lot” means an individual lot of land for which a building permit could be issued to construct a Residential Unit.
“Residential Property” means, for each Fiscal Year, all Taxable Property for which a building permit could be issued for purposes of constructing Residential Units, including Single-Family Detached Property – SF/SFHD Zoning, Single-Family Detached Property – MLD Zoning, MHD Multi-Family Attached Property, and MMD Multi-Family Attached Property. “Residential Unit” means a residential dwelling unit, including Accessory Dwelling Units, as allowed by the City zoning code.
“Services Administrative Expenses” means the actual or reasonably estimated costs directly related to the administration of the Services Special Tax including, but not limited to, the following: the costs of computing the Services Special Taxes and preparing the annual Services Special Tax collection schedules (whether by the City or designee thereof or both); the costs of collecting the Services Special Taxes (whether by the County, the City, or otherwise); the costs associated with preparing Special Tax disclosure statements and responding to public inquiries regarding the Services Special Tax; and the costs of the City, CFD No. 24 IA2B, or any designee thereof related to any appeal of the levy or application of the Services Special Tax. Services Administrative Expenses shall also include amounts estimated or advanced by the City or CFD No. 24 IA2B for any other administrative purposes related to the Services Special Tax.
“Services Special Tax” means, prior to the Transition Event, the annual Special Tax to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property to fund the Services Special Tax Requirement.
“Services Special Tax Escalation Factor” means the maximum of two percent (2%) or the June annualized percentage change of the Consumer Price Index for all Urban Consumers, for the San Francisco-Oakland-San Jose area, not to exceed four percent (4%). “Services Special Tax Requirement” means the amount of Services Special Tax revenue required for CFD No. 24 IA2B, before the Transition Year, to (i) pay Services Administrative Expenses in an amount

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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 CFD No. 24 IA2B Administrator.
“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 and 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 – SF/SFHD 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.
“Special Tax” means, before the Transition Year, 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.

Beginning in the Transition Year, the annual Transition Services Special Tax to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property to fund the Transition Services Special Tax Requirement.
“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. “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 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.
“Small Lot Final Subdivision Map” means a subdivision of property created by recordation of a final subdivision map, parcel map or lot line adjustment, approved by the City pursuant to the Subdivision

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Map Act (California Government Code Section 66410 et seq.) or recordation of a condominium plan pursuant to California Civil Code 1352, that creates individual lots for which building permits may be issued for Residential Units without further subdivision of such property. “State” means the State of California.
“Taxable Property” means all of the Assessor’s Parcels within the boundaries of CFD No. 24 IA2B that are not exempt from the CFD No. 24 IA2B Special Tax pursuant to law or Section F below. “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 reflect the actual property tax rates levied upon Taxable Property in the Fiscal Year that the Effective Tax Rate Evaluation is completed.
“Transition Event” means the earlier of (i) Fiscal Year 2085-2086 or (ii) the Fiscal Year when the CFD No. 24 IA2B Administrator determines that both of the following events have occurred (1) all Bonds secured by the levy and collection of the Facilities Special Tax in CFD No. 24 IA2B have been fully repaid and the City determines that no additional Bonds are to be issued, and (2) all Facilities Administrative Expenses have been paid or reimbursed to CFD No. 24 IA2B. “Transition Services Administrative Expenses” means the actual or reasonably estimated costs directly related to the administration of the Transition Services Special Tax including, but not limited to, the following: the costs of computing the Transition Services Special Taxes and preparing the annual Transition Services Special Tax collection schedules (whether by the City or designee thereof or both); the costs of collecting the Transition Services Special Taxes (whether by the County, the City, or otherwise); the costs associated with preparing Special Tax disclosure statements and responding to public inquiries regarding the Transition Services Special Tax; and the costs of the City, CFD No. 24 IA2B, or any designee thereof related to any appeal of the levy or application of the Transition Services Special Tax. Transition Services Administrative Expenses shall also include amounts estimated or advanced by the City or CFD No. 24 IA2B for any other administrative purposes related to the Transition Services Special Tax.
“Transition Services Special Tax” means, after the Transition Event, the annual Special Tax to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property to fund the Transition Services Special Tax Requirement.
“Transition Services Special Tax Escalation Factor” means the maximum of two percent (2%) or the June annualized percentage change of the Consumer Price Index for all Urban Consumers, for the San Francisco-Oakland-San Jose area, not to exceed four percent (4%). “Transition Services Special Tax Rate” means, calculated in the Transition Year, the amount equal to the prior year’s Maximum Services Special Tax Rate plus fifty percent (50%) of the prior year’s

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Maximum Facilities Special Tax Rate. The Transition Services Special Tax Escalation Factor shall be applied beginning in the Transition Year. Following the Transition Year, the Transition Services Special Tax Rate shall be equal to the prior year’s Transition Services Special Tax Rate, increased by the Transition Services Special Tax Escalation Factor.
“Transition Services Special Tax Requirement” Beginning in the Transition Year, to (i) pay Transition 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, replacement and contingency funds, capital improvement funds, or reserve funds related to the Authorized Services expenses; (iv) pay for reasonably anticipated delinquent Transition Services Special Taxes based on the delinquency rate for Transition Services Special Taxes levied in the previous Fiscal Year; less (v) a credit for funds available to reduce the annual Transition Services Special Tax levy as determined by the CFD No. 24 IA2B Administrator.
“Transition Year” means the first year in which the CFD No. 24 IA2B Administrator determines that the Transition Event occurred in the prior Fiscal Year. “Trustee” means the entity appointed pursuant to an Indenture to act as the trustee, fiscal agent, or paying agent or a combination thereof.
“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.
“Welfare Exempt Property” means, in any Fiscal Year, all Parcels within the boundaries of CFD No. 24 IA2B that (a) have been granted a welfare exemption by the County under subdivision (g) of Section 214 of the Revenue and Taxation Code indicated in the Assessor’s Data finalized as of January 1 of the previous Fiscal Year, and (b) are exempt from the Special Tax pursuant to Section 53340(c) of the Act.

Pursuant to Section 53340(c) of the Act, after the issuance of the first series of Bonds, as applicable, any Assessor’s Parcels that receives a welfare exemption under subdivision (g) of Section 214 of the Revenue and Taxation Code shall not be classified as Welfare Exempt Property and will be subject to the Facilities Special Tax.

B. ASSIGNMENT TO LAND USE CATEGORIES
Each Fiscal Year, using City and County records, City zoning information, and land use development plans, all Assessor’s Parcels within the boundaries of CFD No. 24 IA2B shall be designated as either Taxable Property or Exempt Property.

All Taxable Property shall 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 determined pursuant to Sections C and D below.

C. FACILITIES SPECIAL TAX

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City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2B Page 10
Prior to the Transition Year, a Maximum Facilities Special Tax shall be assigned to all Taxable Property within CFD No. 24 IA2B according to the Maximum Facilities Special Tax Rates set forth in Attachment A of this Rate and Method of Apportionment.

Once assigned, the sum of the total Maximum Facilities Special Tax shall be equal to or greater than the Minimum Facilities Revenue, unless adjusted by an Effective Tax Rate Evaluation as described below. The Minimum Facilities Revenue for Fiscal Year 2026-2027 is set forth in Attachment B of this Rate and Method of Apportionment.

On each July 1, commencing on July 1, 2027, the Maximum Facilities Special Tax Rates and Minimum Facilities Revenue shall be increased by the Facilities Special Tax Escalation Factor of the Maximum Facilities Special Tax Rates and Minimum Facilities Revenue in effect for the previous Fiscal Year.

C.1. Future Assessor’s Parcel Changes – Prior to an Effective Tax Rate Evaluation The 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 sum of the total Maximum Facilities Special Tax revenue is not less than the Minimum Facilities Revenue set forth in Attachment B of this Rate and Method of Apportionment.

Undeveloped Property Subdividing into Large Lot Property When Undeveloped Property subdivides into Large Lot Property, the Maximum Facilities Special Tax shall be calculated for all Taxable Property as if all of the Taxable Property was classified as Developed Property. The expected Developed Property Maximum Facilities Special Tax for any Large Lot Property and any remaining Undeveloped Property shall be based upon the Planned Development for the Large Lot Property and remaining Undeveloped Property.

If the sum of the total expected Developed Property Maximum Facilities Special Tax generated by all of the Taxable Property is greater than or equal to the Minimum Facilities Revenue, there will be no further adjustments to the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non-Residential Property Maximum Facilities Special Tax Rates for the Large Lot Property created from the Undeveloped Property subdivision.

If the sum of the total expected Developed Property Maximum Facilities Special Tax is less than the Minimum Facilities Revenue, the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non-Residential Property Maximum Facilities Special Tax Rates shall be Proportionately increased, on the Large Lot Property created from the Undeveloped Property subdivision, until the sum of the total expected Developed Property Maximum Facilities Special Tax is equal to the Minimum Facilities Revenue. Further, if the sum of the total current Maximum Facilities Special Tax is less than the Minimum Facilities Revenue, the Maximum Facilities Special Tax Rates for the Large Lot Property and any remaining Undeveloped Property created from the Undeveloped Property subdivision shall be Proportionately increased until the sum of the total current Maximum Facilities Special Tax is equal to the Minimum Facilities Revenue. Attachment B of this Rate and Method of Apportionment shall be updated to reflect any increases to the Maximum Facilities Special Tax Rates from the Undeveloped Property subdivision. The

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2B Page 11
Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non- Residential Property Maximum Facilities Special Tax Rates shall not be adjusted for any Taxable Property already classified as Developed Property, Small Lot Final Map Property or Permit Ready Multi-Family/Non-Residential Property.

Large Lot Property Subdividing into Small Lot Final Map Property and Permit Ready Multi- Family/Non-Residential Property
When Large Lot Property subdivides into Small Lot Final Map Property or Permit Ready Multi- Family/Non-Residential Property, the Maximum Facilities Special Tax shall be calculated for all Taxable Property as if all of the Taxable Property was classified as Developed Property. If the Large Lot Property subdivision also creates Small Lot Final Map Remainder Property, the expected Developed Property Maximum Facilities Special Tax for the Small Lot Final Map Remainder Property shall be based upon the Planned Development for the Small Lot Final Map Remainder Property. The expected Developed Property Maximum Facilities Special Tax for any remaining Large Lot Property and Undeveloped Property shall be based upon the Planned Development of the Large Lot Property and the Undeveloped Property.

If the sum of the total expected Developed Property Maximum Facilities Special Tax is greater than or equal to the Minimum Facilities Revenue, there will be no further adjustments to the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non- Residential Property Maximum Facilities Special Tax Rates for the Small Lot Final Map Property, Small Lot Final Map Remainder Property and Permit Ready Multi-Family/Non-Residential Property created from the Large Lot Property subdivision.

If the sum of the total expected Developed Property Maximum Facilities Special Tax is less than the Minimum Facilities Revenue, and such difference is not eliminated by the partial prepayment of the Effective Tax Rate Evaluation Maximum Facilities Special Tax pursuant to Section L, the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non- Residential Property Maximum Facilities Special Tax Rates shall be Proportionately increased, on the Small Lot Final Map Property, Small Lot Final Map Remainder Property and Permit Ready Multi-Family/Non-Residential Property created from the Large Lot Property subdivision, until the sum of the total expected Developed Property Maximum Facilities Special Tax is equal to the Minimum Facilities Revenue. Attachment B of this Rate and Method of Apportionment shall be updated to reflect any increases to the Maximum Facilities Special Tax Rates from the Large Lot Property subdivision. The Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non-Residential Property Maximum Facilities Special Tax Rates shall not be adjusted for any Taxable Property already classified as Developed Property, Small Lot Final Map Property or Permit Ready Multi-Family/Non-Residential Property created prior to the Large Lot Property subdivision.

C.2. Effective Tax Rate Evaluation
Prior to the issuance of the first series of Bonds within CFD No. 24 IA2B an Effective Tax Rate Evaluation will be completed. Following the Effective Tax Rate Evaluation, Attachment C of this

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2B Page 12
Rate and Method of Apportionment will be updated to reflect the Effective Tax Rate Evaluation Maximum Facilities Special Tax Rate for all Taxable Property in CFD No. 24 IA2B.

Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates As part of the Effective Tax Rate Evaluation, a Price Point Study will be prepared and an estimated average sales prices will be established for each Residential Property land use category. Using the estimated average sales price information determined in the Price Point Study, the Total Estimated Tax Burden and Total Effective Tax Rate will be calculated, using the Developed Property Maximum Facilities Special Tax Rates set forth in Attachment A, for each Residential Property land use category. If the calculated Total Effective Tax Rate is less than or equal to the Total Maximum Effective Tax Rate for a Residential Property land use category, the Maximum Facilities Special Tax Rate shall not be adjusted and will be assigned using the Developed Property Maximum Facilities Special Tax Rates set forth in Attachment A. Attachment C of this Rate and Method of Apportionment will be updated to set forth the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rate for each Residential Property land use category.

If the Total Effective Tax Rate for any Residential Property land use category exceeds the Total Maximum Effective Tax Rate, the Developed Property Maximum Facilities Special Tax Rate set forth in Attachment A shall be reduced until the Total Effective Tax Rate is less than or equal to the Total Maximum Effective Tax Rate for that Residential Property land use category.

Attachment C of this Rate and Method of Apportionment will be updated to set forth the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rate for each Residential Property land use category.

Effective Tax Rate Evaluation Minimum Facilities Revenue As a result of the Effective Tax Rate Evaluation, if the calculated Total Effective Tax Rate is less than or equal to the Total Maximum Effective Tax Rate for a Residential Property land use category used in the Minimum Facilities Revenue calculation, the Developed Property Maximum Facilities Special Tax Rate for the applicable Residential Property land use category shall not be adjusted and the Effective Tax Rate Evaluation Developed Property Maximum Facilities Special Tax Rate will be assigned using the Developed Property Maximum Facilities Special Tax Rates set forth in Attachment B. Attachment D of this Rate and Method of Apportionment will be updated to set forth the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rate for each Residential Property land use category and the Effective Tax Rate Evaluation Minimum Facilities Revenue.

If the calculated Total Effective Tax Rate exceeds the Total Maximum Effective Tax Rate for a Residential Property land use category used in the Minimum Facilities Revenue calculation, the Effective Tax Rate Evaluation Developed Property Maximum Facilities Special Tax Rate will be assigned using the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates set forth in Attachment C. Attachment D of this Rate and Method of Apportionment will be updated to set forth the Developed Property Effective Tax Rate Evaluation Maximum

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2B Page 13
Facilities Special Tax Rate for each Residential Property land use category and the Effective Tax Rate Evaluation Minimum Facilities Revenue.

C.3. Future Assessor’s Parcel Changes – After an Effective Tax Rate Evaluation 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 sum of the total Effective Tax Rate Evaluation Maximum Facilities Special Tax revenue is not less than the total Effective Tax Rate Evaluation Minimum Facilities Revenue set forth in Attachment D of this Rate and Method of Apportionment.

Undeveloped Property Subdividing into Large Lot Property When Undeveloped Property subdivides into Large Lot Property, the Effective Tax Rate Evaluation Maximum Facilities Special Tax shall be calculated for all Taxable Property as if all of the Taxable Property was classified as Developed Property. The expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax for any Large Lot Property and any remaining Undeveloped Property shall be based upon the Planned Development for the Large Lot Property and remaining Undeveloped Property.

If the sum of the total expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax generated by all of the Taxable Property is greater than or equal to the Effective Tax Rate Evaluation Minimum Facilities Revenue, there will be no further adjustments to the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non- Residential Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates for the Large Lot Property created from the Undeveloped Property subdivision.

If the sum of the total expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax is less than the Effective Tax Rate Evaluation Minimum Facilities Revenue, the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non- Residential Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates shall be Proportionately increased, on the Large Lot Property created from the Undeveloped Property subdivision, until the sum of the total expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax is equal to the Effective Tax Rate Evaluation Minimum Facilities Revenue. Further, if the sum of the total current Effective Tax Rate Evaluation Maximum Facilities Special Tax is less than the Effective Tax Rate Evaluation Minimum Facilities Revenue, the Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates for the Large Lot Property and any remaining Undeveloped Property created from the Undeveloped Property subdivision shall be Proportionately increased until the sum of the total current Effective Tax Rate Evaluation Maximum Facilities Special Tax is equal to the Effective Tax Rate Evaluation Minimum Facilities Revenue. Attachment D of this Rate and Method of Apportionment shall be updated to reflect any increases to the Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates from the Undeveloped Property subdivision. The Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non-Residential Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates shall not be adjusted for any Taxable Property already classified as

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2B Page 14
Developed Property, Small Lot Final Map Property or Permit Ready Multi-Family/Non-Residential Property.

Large Lot Property Subdividing into Small Lot Final Map Property and Permit Ready Multi- Family/Non-Residential Property
When Large Lot Property subdivides into Small Lot Final Map Property or Permit Ready Multi- Family/Non-Residential Property, the Effective Tax Rate Evaluation Maximum Facilities Special Tax shall be calculated for all Taxable Property as if all of the Taxable Property was classified as Developed Property. If the Large Lot Property subdivision also creates Small Lot Final Map Remainder Property, the expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax for the Small Lot Final Map Remainder Property shall be based upon the Planned Development for the Small Lot Final Map Remainder Property. The expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax for any remaining Large Lot Property and Undeveloped Property shall be based upon the Planned Development of the Large Lot Property and the Undeveloped Property.

If the sum of the total expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax is greater than or equal to the Effective Tax Rate Evaluation Minimum Facilities Revenue, there will be no further adjustments to the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non-Residential Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates for the Small Lot Final Map Property, Small Lot Final Map Remainder Property and Permit Ready Multi-Family/Non-Residential Property created from the Large Lot Property subdivision.

If the sum of the total expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax is less than the Effective Tax Rate Evaluation Minimum Facilities Revenue, and such difference is not eliminated by the partial prepayment of the Effective Tax Rate Evaluation Maximum Facilities Special Tax pursuant to Section L, the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non-Residential Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates shall be Proportionately increased, on the Small Lot Final Map Property, Small Lot Final Map Remainder Property and Permit Ready Multi- Family/Non-Residential Property created from the Large Lot Property subdivision, until the sum of the total expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax is equal to the Effective Tax Rate Evaluation Minimum Facilities Revenue. Attachment D of this Rate and Method of Apportionment shall be updated to reflect any increases to the Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates from the Large Lot Property subdivision. The Developed Property, Small Lot Final Map Property and Permit Ready Multi- Family/Non-Residential Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates shall not be adjusted for any Taxable Property already classified as Developed Property, Small Lot Final Map Property or Permit Ready Multi-Family/Non-Residential Property created prior to the Large Lot Property subdivision.

C.4. Method of Apportionment of Facilities Special Tax

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2B Page 15
Using the definitions and procedures described herein, the CFD No. 24 IA2B 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 until the Transition Year as follows:

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

Second: 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 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.

Third: 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 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.

Fourth: 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 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.

Fifth: 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 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.

After an Effective Tax Rate Evaluation
First: 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.

Second: 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.

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City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2B Page 16
Third: 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.

Fourth: 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.

Fifth: 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.

D. SERVICES SPECIAL TAX
A Services Special Tax shall be assigned to all Taxable Property within CFD No. 24 IA2B according to the Maximum Services Special Tax Rates set forth in Attachment A of this Rate and Method of Apportionment.

D.1. Prior to the Transition Event - Increase in the Maximum Services Special Tax Prior to the Transition Event, on each July 1, commencing on July 1, 2027, the Maximum Services Special Tax Rates shall be increased by the Services Special Tax Escalation Factor of the Maximum Services Special Tax Rates in effect for the previous Fiscal Year.

D.2. Prior to the Transition Event - Method of Apportionment of Services Special Tax If, in any Fiscal Year prior to the Transition Year, the Facilities Special Tax is levied against each Assessor’s Parcel of Taxable Property within CFD No. 24 IA2B and the Facilities Special Tax revenues generated are insufficient to pay the Facilities Special Tax Requirement such shortfall shall be deemed a component of the Services Special Tax Requirement in that Fiscal Year, and proceeds from the levy of the Services Special Tax shall first be applied to mitigate the shortfall in the Facilities Special Tax Requirement before being used to pay for Authorized Services. The Services Special Tax revenue shall not be applied to any Facilities Special Tax Requirement shortfalls attributable to Pay As You Go Costs authorized to be financed by CFD No. 24 IA2B.

Using the definitions and procedures described herein, the CFD No. 24 IA2B Administrator shall determine the Services Special Tax Requirement and levy the Services Special Tax until the amount of Services Special Tax equals the Services Special Tax Requirement. The Services Special Tax shall be levied each Fiscal Year as follows:

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2B Page 17
First: 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.

Second: 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 100% of the Maximum Services Special Tax in order to satisfy the Services Special Tax Requirement.

Third: 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 100% of the Maximum Services Special Tax in order to satisfy the Services Special Tax Requirement.

Fourth: If additional monies are needed to satisfy the Services Special Tax Requirement after the 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.

Fifth: If additional monies are needed to satisfy the Services Special Tax Requirement after the three steps have been completed, the Services Special Tax shall be levied Proportionately on all Undeveloped Property at a rate up to 100% of the Maximum Services Special Tax in order to satisfy the Services Special Tax Requirement.

E. TRANSITION SERVICES SPECIAL TAX
A Transition Services Special Tax shall be assigned to all Taxable Property within CFD No. 24 IA2B according to the Maximum Transition Services Special Tax Rates set forth in Attachment A of this Rate and Method of Apportionment.

E.1. After the Transition Event – Method of Apportionment of Transition Services Special Tax Using the definitions and procedures described herein, the CFD No. 24 IA2B Administrator shall determine the Transition Services Special Tax Requirement and levy the Transition Services Special Tax until the amount of Transition Services Special Tax equals the Transition Services Special Tax Requirement. The Transition Services Special Tax shall be levied each Fiscal Year as follows:

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

Second: If additional monies are needed to satisfy the Transition Services Special Tax Requirement after the first step has been completed, the Transition Services Special Tax shall be levied Proportionately on all Small Lot Final Map Property at a rate up to 100% of the Maximum Transition Services Special Tax in order to satisfy the Transition Services Special Tax Requirement.

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City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2B Page 18
Third: If additional monies are needed to satisfy the Transition Services Special Tax Requirement after the first two steps have been completed, the Transition Services Special Tax shall be levied Proportionately on all Permit Ready Multi-Family/Non-Residential Property at a rate up to 100% of the Maximum Transition Services Special Tax in order to satisfy the Transition Services Special Tax Requirement.

Fourth: If additional monies are needed to satisfy the Transition Services Special Tax Requirement after the three steps have been completed, the Transition Services Special Tax shall be levied Proportionately on all Large Lot Property at a rate up to 100% of the Maximum Transition Services Special Tax in order to satisfy the Transition Services Special Tax Requirement.

Fifth: If additional monies are needed to satisfy the Transition Services Special Tax Requirement after the three steps have been completed, the Transition Services Special Tax shall be levied Proportionately on all Undeveloped Property at a rate up to 100% of the Maximum Transition Services Special Tax in order to satisfy the Transition Services Special Tax Requirement.

F. DELINQUENCIES
Notwithstanding the above, under no circumstances will the CFD No. 24 IA2B Facilities Special Tax levied against any Assessor’s Parcel of Developed Property classified as Residential Property, in any Fiscal Year, be increased as a consequence of the delinquency or default in the payment of the CFD No. 24 IA2B Facilities Special Taxes by the owner or owners of any other Taxable Property by more than ten percent (10%) above the amount that would have been levied against such Assessor’s Parcel in such Fiscal Year had there been no delinquencies or defaults.

G. EXEMPTIONS
The CFD No. 24 IA2B Administrator shall classify the following as Exempt Property: Public Property, Property Owner Association Property, Open Space Property, and Assessor’s Parcels with public or utility easements making impractical their utilization for any use other than the purposes set forth in the easement.

The Maximum Facilities Special Tax obligation or, if applicable, the Effective Tax Rate Evaluation Maximum Facilities Special Tax obligation for Taxable Property which will be transferred or dedicated to a public agency and will be classified as Public Property may be fully prepaid by the seller, pursuant to Section L, prior to the transfer/dedication of such Taxable Property. Until the Maximum Facilities Special Tax obligation or, if applicable, the Effective Tax Rate Evaluation Maximum Facilities Special Tax obligation for any such Taxable Property is prepaid, the Taxable Property shall continue to be subject to the levy of the Facilities Special Tax. An exception to this may be made if an Assessor’s Parcel of Public Property, such as a school site, is relocated to an Assessor’s Parcel of Taxable Property, in which case the Assessor’s Parcel of previously Public Property becomes Taxable Property and the Assessor’s Parcel of previously Taxable Property becomes Public Property. This trading of an Assessor’s Parcel from Taxable Property to Public Property will be permitted to the extent there is no loss in Maximum Facilities Special Tax revenue or, if applicable, Effective Tax Rate Evaluation Maximum Facilities Special Tax revenue, and the transfer is agreed to by the owners of all Assessor’s Parcels involved in the transfer and the City Council.

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2B Page 19
If the use of an Assessor’s Parcel changes so that such Assessor’s Parcel is no longer eligible to be classified as one of the uses set forth in Section G.1. above that would make such Assessor’s Parcel eligible to continue to be classified as Exempt Property, such Assessor’s Parcel shall cease to be classified as Exempt Property and shall be deemed to be Taxable Property and subject to the Special Tax.

No Special Tax shall be levied on any Assessor’s Parcel in any Fiscal Year in which such Assessor’s Parcel is classified as Welfare Exempt Property; however, pursuant to Section 53340(c) of the Act, after the issuance of the first series of Bonds, as applicable, any Assessor’s Parcel that receives a welfare exemption under subdivision (g) of Section 214 of the Revenue and Taxation Code shall not be classified as Welfare Exempt Property and will be subject to the Facilities Special Tax.

H. TRANSFERS
Prior to the issuance of the first series of Bonds within CFD No. 24 IA2B, the City may permit the transfer of Maximum Facilities Special Tax or Effective Tax Rate Evaluation Maximum Facilities Special Tax from one Assessor’s Parcel to another Assessor’s Parcel. Before recordation of a Small Lot Final Subdivision Map, if a subdivision map is required, the City may permit a transfer if the number of planned Residential Units, Multi-Family Attached Property Acreage, or Non-Residential Property Acreage is transferred from one Assessor’s Parcel(s) to another Assessor’s Parcel(s) in any portion of Large Lot Property. The City may, in its sole discretion, allow for a transfer of the Maximum Facilities Special Tax or Effective Tax Rate Evaluation Maximum Facilities Special Tax from one Assessor’s Parcel to another Assessor’s Parcel provided such a transfer shall be allowed only if (1) all adjustments are agreed to in writing by the affected property owners and the City’s Finance Director, and (2) there is no reduction in the sum of the total Maximum Facilities Special Tax or sum of the total Effective Tax Rate Evaluation Maximum Facilities Special Tax as a result of the transfer. Should a transfer result in an amendment to Attachment B or, following an Effective Tax Rate Evaluation, Attachment D of this Rate and Method of Apportionment, the requesting property owner shall bear the costs to affect the transfer in the CFD No. 24 IA2B records and prepare the required amendments to Attachment B or, following an Effective Tax Rate Evaluation, Attachment D of this Rate and Method of Apportionment.

I. INTERPRETATIONS
The City reserves the right to make minor administrative and technical changes to this document that do not materially affect the Rate and Method of Apportionment of Special Tax. In addition, the interpretation and application of any section of this document shall be at the City’s discretion.

Interpretations may be made by the City by ordinance or resolution for purposes of clarifying any vagueness or ambiguity in this Rate and Method of Apportionment of Special Tax.

J. REVIEW/APPEALS
The CFD No. 24 IA2B Administrator may establish such procedures, as it deems necessary to undertake the review of any such appeal. The CFD No. 24 IA2B Administrator shall interpret this Rate and Method of Apportionment of Special Tax and make determinations relative to the annual administration of the Special Tax and any property owner appeals, as herein specified.

06/09/2026 Item No.13.

City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2B Page 20
Any property owner may file a written appeal of the Special Tax with the CFD No. 24 IA2B Administrator claiming that the amount or application of the Special Tax is not correct. The appeal must be filed not later than one calendar year after having paid the Special Taxes that are disputed, and the appellant must be current in all payments of Special Taxes. In addition, during the term of the appeal process, all Special Taxes levied must be paid on or before the payment date established when the levy was made. The appeal must specify the reasons why the appellant claims the Special Taxes are in error. The CFD No. 24 IA2B Administrator shall review the appeal, meet with the appellant if the CFD No. 24 IA2B Administrator deems necessary, and advise the appellant of its determination.

If the property owner disagrees with the CFD No. 24 IA2B Administrator’s decision relative to the appeal, the owner may file a written notice with the City Manager appealing the amount of the Special Tax levied on such Assessor’s Parcel. If following such consultation and action (if any by the City Manager), the property owner believes such error still exists, such person may file a written notice with the City Council appealing the amount of the Special Tax levied on such Assessor’s Parcel. The decision of the City shall be final and binding to all persons. If the decision of the CFD No. 24 IA2B Administrator or subsequent decision by the City Manager or City Council requires the Special Taxes to be modified or changed in favor of the property owner, no cash refund shall be made for prior years’ Special Taxes, but an adjustment shall be made to credit future Special Taxes. This procedure shall be exclusive and its exhaustion by any property owner shall be a condition precedent to filing any legal action by such owner.

K. MANNER OF COLLECTION
The annual Special Tax shall be collected in the same manner and at the same time as ordinary ad valorem property taxes; provided, however, that CFD No. 24 IA2B, may, at the sole discretion of the City, directly bill the Special Tax, may collect Special Taxes at a different time or in a different manner as necessary to meet its financial obligations, and may covenant to foreclose and may actually foreclose on Assessor’s Parcels of Taxable Property that are delinquent in the payment of Special Taxes.

L. PREPAYMENT IN PART OF FACILITIES SPECIAL TAX
The Facilities Special Tax obligation of an Assessor’s Parcel of Taxable Property may be partially prepaid as described herein; provided that there are no delinquent Special Taxes with respect to such Assessor’s Parcel at the time of partial prepayment. An owner of an Assessor’s Parcel intending to partially prepay the Facilities Special Tax obligation shall provide the CFD No. 24 IA2B Administrator with written notice of intent to partially prepay. Within 30 days of receipt of such written notice, the CFD No. 24 IA2B Administrator shall notify such owner of the partial prepayment amount of such Assessor’s Parcel. Any partial prepayment must be submitted at least 60 days before the next occurring bond redemption date, and the proceeds of such prepayment shall be provided to the Trustee for application toward bond redemption in accordance with the Indenture. The CFD No. 24 IA2B Administrator may charge a fee for providing this service.

L.1. Partial Prepayment Amount

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The Facilities Special Tax may be prepaid in an amount determined at the time of prepayment based on the portion of Bonds then outstanding; provided, however, that no partial prepayment shall be accepted in an amount equal to an annual Special Tax amount less than the annual Transition Services Special Tax rate escalated to the then current fiscal year less the then current Services Special Tax rate.

Step 1: Determine the current Fiscal Year Maximum Facilities Special Tax for the Assessor’s Parcel based on the assignment of the Maximum Facilities Special Tax described in Section C above. If an Effective Tax Rate Evaluation has occurred, determine the current Fiscal Year Effective Tax Rate Evaluation Maximum Facilities Special Tax for the Assessor’s Parcel based on the assignment of the Effective Tax Rate Evaluation Maximum Facilities Special Tax described in Section C above.

If the Assessor’s Parcel is not already classified as Developed Property, the Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) shall be assigned as though the Assessor’s Parcel was already designated as Developed Property.

Step 2: Calculate the annual revenue produced, by annually applying the Facilities Special Tax Escalation Factor, from the Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) from the date of prepayment through the earlier of the end of the Facilities Special Tax Term or the Transition Event, except that this final date may be amended by the City no later than the time of the calculation of the prepayment. If the final date used in the prepayment calculation is amended by the City, this amended final date shall apply to any and all prepayment calculations from that point forward.

Step 3: Calculate the present value of the Assessor’s Parcel’s annual Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) revenue stream determined in Step 2. The present value shall be calculated using a discount rate that earns a rate of interest that, when the prepayment is invested in City permitted and available investments, would produce annual revenues equal to the amounts calculated in Step 2.

If there are Outstanding Bonds at the time of the Partial Prepayment Amount calculation, the Partial Prepayment Amount shall be first allocated to the Redemption Amount. If the Partial Prepayment Amount is insufficient to fund the Redemption Amount, then the Partial Prepayment Amount shall be increased to equal the Redemption Amount.

The Redemption Amount is calculated as follows:

Step 1: Divide the Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) computed pursuant to Step 1 of Section L.1 by the total Maximum Facilities Special Taxes (or total Effective Tax Rate Evaluation Maximum Facilities Special Taxes) for the entire CFD No. 24 IA2B, based on the Maximum Facilities Special Taxes (or Effective Tax Rate Evaluation Maximum Facilities Special Taxes) that could be charged in the current Fiscal Year if all Taxable Property were designated as Developed Property, excluding any Assessor’s Parcels which have prepaid the Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) obligation (the “Prepayment Quotient”).

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Step 2: Multiply the Prepayment Quotient by the Outstanding Bonds to compute the amount of Outstanding Bonds to be redeemed (the “Bond Redemption Amount”).

Step 3: Multiply the Bond Redemption Amount by the applicable redemption premium, if any, on the Outstanding Bonds to be redeemed.

Step 4: Compute the amount needed to pay interest on the Bond Redemption Amount from the first Bond interest payment date following the current Fiscal Year until the earliest redemption date for the Outstanding Bonds.

Step 5: Determine that portion of Facilities Special Taxes levied on the Assessor’s Parcel in the current Fiscal Year to satisfy the Facilities Special Tax Requirement, which have not yet been paid.

Step 6: A reserve fund credit shall equal the lesser of: (a) the expected reduction in the reserve requirement (as defined in the Indenture for the Bonds), if any, associated with the redemption of Outstanding Bonds as a result of the partial prepayment, or (b) the amount derived by subtracting the new reserve requirement (as defined in the Indenture for the Bonds) in effect after the redemption of Outstanding Bonds as a result of the partial prepayment from the balance in the reserve fund on the prepayment date, but in no event shall such amount be less than zero. Such reserve fund credit will not decrease the balance in the reserve fund below the new reserve requirement.

Step 7: If any capitalized interest for the Outstanding Bonds will not have been expended at the time of the first interest and/or principal payment following the current Fiscal Year, a capitalized interest credit shall be calculated by multiplying the quotient computed pursuant to Step 1 by the expected balance in the capitalized interest fund after such first interest payment.

Step 8: The redemption amount is equal to the sum of the amounts computed pursuant to Steps 2, 3, 4, and 5, less the amount computed pursuant to Steps 6 and 7 (the “Redemption Amount”).

If the Partial Prepayment Amount exceeds the Redemption Amount, then any remaining Partial Prepayment Amount, after allocating the Redemption Amount, shall be designated as Pay as You Go Costs.

The Partial Prepayment Amount shall include any fees or expenses, including the costs of computation of the prepayment, the costs to invest the prepayment proceeds, the cost of redeeming Bonds, and the costs of recording any notices to evidence the prepayment and the redemption (the “Administrative Fees and Expenses”).

In addition, the City has the authority to adjust the Partial Prepayment Amount calculated above if a portion or all of the current property tax bill and the portion attributable to the payment of the Facilities Special Tax has not been used to make an interest and/or principal payment on the Bonds.

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Notwithstanding the foregoing, no partial prepayment shall be allowed unless the amount of Maximum Facilities Special Taxes (or Effective Tax Rate Evaluation Maximum Facilities Special Taxes), net of any priority administration, if any as defined in the Bond documents, that may be levied on Taxable Property, in each Fiscal Year, both prior to and after the proposed partial prepayment, is at least 1.1 times the annual debt service on all Outstanding Bonds to be paid from the Maximum Facilities Special Taxes (or Effective Tax Rate Evaluation Maximum Facilities Special Taxes) in each Fiscal Year.

M. TERM OF SPECIAL TAX
The Maximum Facilities Special Tax and Effective Tax Rate Evaluation Maximum Facilities Special Tax shall be levied commencing in Fiscal Year 2026-2027 to the extent necessary to fully satisfy the Facilities Special Tax Requirement and shall be levied for the Facilities Special Tax Term.

The Maximum Services Special Tax shall be levied commencing in Fiscal Year 2026-2027 and shall be levied until the Transition Event to the extent necessary to fully satisfy the Services Special Tax Requirement.

The Maximum Transition Services Special Tax shall be levied commencing in the Fiscal Year following the Transition Event in perpetuity, unless and until such time the City determines that revenues are no longer needed to pay the Transition Services Special Tax Requirement.

including Single-Family Detached Property – SF/SFHD Zoning, Single-Family Detached Property – MLD Zoning, MHD Multi-Family Attached Property, and MMD Multi-Family Attached Property.

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City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 2B Page 24

ATTACHMENT A

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 24 (ALDER CREEK WEST) IMPROVEMENT AREA 2B

MAXIMUM SPECIAL TAX RATES
(FISCAL YEAR 2026-2027)
Land Use Category Lot / Village #
2026-2027
Maximum
Facilities Special
Tax Rate(1)
2026-2027
Maximum
Services Special
Tax Rate(2) Taxed Per
Developed Property:

Single-Family Detached Property – SFHD Zoning 2A $2,947 $578 Residential Lot Single-Family Detached Property – SFHD Zoning 2B 2,563 566 Residential Lot Multi-Family Attached Property – MLD Zoning 3A 2,573 461 Residential Lot Single-Family Detached Property – SF Zoning 3B 5,025 857 Residential Lot Single-Family Detached Property – SF Zoning 4A 3,848 931 Residential Lot Single-Family Detached Property – SF Zoning 4B 5,042 840 Residential Lot Small Lot Final Map Property:

Single-Family Detached Property – SFHD Zoning 2A $2,947 $578 Residential Lot Single-Family Detached Property – SFHD Zoning 2B 2,563 566 Residential Lot Multi-Family Attached Property – MLD Zoning 3A 2,573 461 Residential Lot Single-Family Detached Property – SF Zoning 3B 5,025 857 Residential Lot Single-Family Detached Property – SF Zoning 4A 3,848 931 Residential Lot Single-Family Detached Property – SF Zoning 4B 5,042 840 Residential Lot Permit Ready Multi-Family/Non-Residential Property $20,000 N/A Acre Large Lot Property $20,000 N/A Acre
Undeveloped Property $20,000 N/A Acre
(1) On each July 1, commencing on July 1, 2027, the Maximum Facilities Special Tax Rates shall be increased by the Facilities Special Tax Escalation Factor of the Maximum Facilities Special Tax Rates in effect for the previous Fiscal Year. (2) On each July 1, commencing on July 1, 2027, the Maximum Services Special Tax Rates shall be increased by an amount equal to the Services Special Tax Escalation Factor of the Maximum Services Special Tax Rates in effect for the previous Fiscal Year.

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ATTACHMENT B

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 24 (ALDER CREEK WEST) IMPROVEMENT AREA 2B

MINIMUM FACILITIES REVENUE
(FISCAL YEAR 2026-2027)
Land Use Category Lot / Village #
Planned Number
of Residential
Lots / Acres
2026-2027
Developed Property
Maximum Facilities
Special Tax Rate(1)(2)
2026-2027
Minimum
Facilities
Revenue (1)(3)
Developed Property:

Single-Family Detached Property – SFHD Zoning 2A 106 $2,947 $312,382 Single-Family Detached Property – SFHD Zoning 2B 71 2,563 181,973 Multi-Family Attached Property – MLD Zoning 3A 132 2,573 339,636 Single-Family Detached Property – SF Zoning 3B 25 5,025 125,625 Single-Family Detached Property – SF Zoning 4A 31 3,848 119,288 Single-Family Detached Property – SF Zoning 4B 63 5,042 317,646 Total Minimum Facilities Revenue(4) $1,396,550
(1) On each July 1, commencing on July 1, 2027, the Developed Property Maximum Facilities Special Tax Rates and Minimum Facilities Revenue shall be increased by the Facilities Special Tax Escalation Factor of the Developed Property Maximum Facilities Special Tax Rates and Minimum Facilities Revenue in effect for the previous Fiscal Year. (2) As a result of future Assessor’s Parcel changes, described in Section C.1, the assigned Maximum Facilities Special Tax Rates for Developed Property may exceed the Developed Property Maximum Facilities Special Tax Rates set forth in this table. (3) The total Minimum Facilities Revenue may be decreased as result of a portion of Maximum Facilities Special Tax obligations being prepaid pursuant to Section L.
(4) Based upon the Developed Property Maximum Facilities Special Tax Rate for Single-Family Detached Property in Lot/Village 2A, 2B, 3A, 3B, 4A, and 4B.

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ATTACHMENT C

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 24 (ALDER CREEK WEST) IMPROVEMENT AREA 2B

EFFECTIVE TAX RATE EVALUATION MAXIMUM FACILITIES SPECIAL TAX RATES (FISCAL YEAR 2026-2027)
Land Use Category Lot / Village #
2026-2027
Effective Tax Rate Evaluation
Maximum Facilities Special
Tax Rate(1)(2) Taxed Per
Developed Property:

Single-Family Detached Property – SFHD Zoning 2A $_________ Residential Lot Single-Family Detached Property – SFHD Zoning 2B _________ Residential Lot Multi-Family Attached Property – MLD Zoning 3A _________ Residential Lot Single-Family Detached Property – SF Zoning 3B _________ Residential Lot Single-Family Detached Property – SF Zoning 4A _________ Residential Lot Single-Family Detached Property – SF Zoning 4B _________ Residential Lot Small Lot Final Map Property:

Single-Family Detached Property – SFHD Zoning 2A $_________ Residential Lot Single-Family Detached Property – SFHD Zoning 2B _________ Residential Lot Multi-Family Attached Property – MLD Zoning 3A _________ Residential Lot Single-Family Detached Property – SF Zoning 3B _________ Residential Lot Single-Family Detached Property – SF Zoning 4A _________ Residential Lot Single-Family Detached Property – SF Zoning 4B _________ Residential Lot Permit Ready Multi-Family/Non-Residential Property $_________ Acre Large Lot Property $_________ Acre
Undeveloped Property $_________ Acre
(1) Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates will be inserted following the Effective Tax Rate Evaluation. (2) On each July 1, commencing in the Fiscal Year after the Effective Tax Rate Evaluation occurs, the Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates shall be increased by the Facilities Special Tax Escalation Factor of the Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates in effect for the previous Fiscal Year.

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ATTACHMENT D

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 24 (ALDER CREEK WEST) IMPROVEMENT AREA 2B

EFFECTIVE TAX RATE EVALUATION MINIMUM FACILITIES REVENUE (FISCAL YEAR 2026-2027)
Land Use Category Lot / Village #
Planned Number
of Residential
Lots / Acres(1)
2026-2027
Developed Property
Effective Tax Rate
Evaluation Maximum
Facilities Special Tax
Rate(1)(2)(3)
2026-2027
Effective Tax Rate
Evaluation
Minimum Facilities
Revenue(1)(2)(4)
Developed Property:

Single-Family Detached Property – SFHD Zoning 2A 106 $_________ $_________ Single-Family Detached Property – SFHD Zoning 2B 71 _________ _________ Multi-Family Attached Property – MLD Zoning 3A 132 _________ _________ Single-Family Detached Property – SF Zoning 3B 25 _________ _________ Single-Family Detached Property – SF Zoning 4A 31 _________ _________ Single-Family Detached Property – SF Zoning 4B 63 _________ _________ Total Effective Tax Rate Evaluation Minimum Facilities
Revenue(5)
$_________
(1) Planned Number of Residential Units/Acres, Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rate and Effective Tax Rate Evaluation Minimum Facilities Revenue to be inserted following the Effective Tax Rate Evaluation. (2) On each July 1, commencing in the Fiscal Year after the Effective Tax Rate Evaluation occurs, the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates and Effective Tax Rate Evaluation Minimum Facilities Revenue shall be increased by the Facilities Special Tax Escalation Factor of the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates and Effective Tax Rate Evaluation Minimum Facilities Revenue in effect for the previous Fiscal Year. (3) As a result of future Assessor’s Parcel changes, described in Section C.3, the assigned Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates may exceed the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates set forth in this table.
(4) The total Effective Tax Rate Evaluation Minimum Facilities Revenue may be decreased as result of a portion of Effective Tax Rate Evaluation Maximum Facilities Special Tax obligations being prepaid pursuant to Section L. (5) Based upon the Developed Property Maximum Facilities Special Tax Rate for Single-Family Detached Property in Lot/Village 2A, 2B, 3A, 3B, 4A, and 4B.

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ATTACHMENT E

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 24 (ALDER CREEK WEST) IMPROVEMENT AREA 2B

MAP OF VILLAGES

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City of Folsom
Community Facilities District No. 24 (Alder Creek West) Public Hearing Report E APPENDIX E: RATE AND METHOD OF APPORTIONMENT –
IA 3
The following pages provide a copy of the Rate and Method of Apportionment for IA 3.

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RATE AND METHOD OF APPORTIONMENT FOR

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 24
(ALDER CREEK WEST)
IMPROVEMENT AREA 3
A Special Tax, as hereinafter defined, shall be levied on each Assessor's Parcel of Taxable Property within the City of Folsom Community Facilities District No. 24 (Alder Creek West) Improvement Area 3 (CFD No. 24 IA3) and collected each Fiscal Year in an amount determined by the CFD No. 24 IA3 Administrator through the application of the Rate and Method of Apportionment as described below. All of the real property within CFD No. 24 IA3, unless exempted by law or by the provisions hereof, shall be taxed for the purposes, to the extent and in the manner herein provided.

A. GENERAL DEFINITIONS
The terms hereinafter set forth have the following meaning:
“Accessory Dwelling Unit” or “ADU” means a secondary residential unit of limited size, as defined in California Government Code Section 66313, as may be amended from time to time, that is accessory to a single-unit dwelling. The ADU may be on the same Assessor’s Parcel as the single-unit dwelling or on a separate Assessor’s Parcel. For purposes of clarification, where an ADU and primary Unit are on the same Assessor’s Parcel, the ADU located on such Assessor’s Parcel is considered a separate Unit from the primary Unit on such Assessor’s Parcel for purposes of the Special Tax. Should an Assessor’s Parcel contain only an ADU, such Assessor’s Parcel will be taxed as an ADU only. “Acre” or “Acreage” means the land area of an Assessor’s Parcel as shown on County records, such as an Assessor’s Parcel Map and secured roll data, or if the land area is not shown on an Assessor’s Parcel Map, the land area shown on the applicable Large Lot Map, Small Lot Final Subdivision Map, condominium plan, record of survey, or other recorded document creating or describing the parcel.

If the preceding maps for a land area are not available, the Acreage of such land area may be determined utilizing available spatial data and GIS. The square footage of an Assessor’s Parcel is equal to the Acreage of such parcel multiplied by 43,560.
“Act” means the Mello-Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Division 2 of Title 5 of the Government Code of the State of California. “Assessor’s Parcel” or “Parcel” means a lot or parcel shown in an Assessor’s Parcel Map with an assigned Assessor’s Parcel number.
“Assessor’s Parcel Map” means an official map of the County Assessor of the County designating lots or parcels by an Assessor’s Parcel number.
“Authorized Services” means the services authorized to be financed by CFD No. 24 IA3. “Bond Year” means a one-year period beginning on September 2nd in each year and ending on September 1st in the following year, unless defined differently in the applicable Indenture. “Bonds” means any bonds or other debt (as defined in the Act), whether in one or more series, issued by CFD No. 24 IA3 under the Act.

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“CFD No. 24 IA3” means City of Folsom Community Facilities District No. 24 (Alder Creek West) Improvement Area 3.
“CFD No. 24 IA3 Administrator” means the City’s Finance Director, or designee thereof, responsible for determining the Facilities Special Tax Requirement, Services Special Tax Requirement and providing for the levy and collection of the Special Taxes. “City” means the City of Folsom.
“City Council” means the City Council of the City, acting as the legislative body of CFD No. 24 IA3. “County” means the County of Sacramento.
“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. “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.
“Effective Tax Rate Evaluation Maximum Facilities Special Tax” means the total maximum annual Facilities Special Tax, as determined during the Effective Tax Rate Evaluation, in accordance with the provisions of Section C.2, which may be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.
“Effective Tax Rate Evaluation Maximum Facilities Special Tax Rate” means the maximum annual Facilities Special Tax rate for each land use category of Taxable Property that will be set forth in Attachment C, following 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 Minimum Facilities Revenue” means, following the Effective Tax Rate Evaluation, the total minimum amount of CFD No. 24 IA3 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 partially prepaid pursuant to Section L. The Effective Tax Rate Evaluation Minimum Facilities Revenue, based on Planned Development, is set forth in Attachment D of this Rate and Method of Apportionment.
“Exempt Property” means all Assessors’ Parcels that are exempt from the Special Tax pursuant to Section F.
“Facilities Administrative Expenses” means the actual or reasonably estimated costs directly related to the administration of the Facilities Special Tax including, but not limited to, the following: the costs of computing the Facilities Special Tax and preparing the annual Facilities Special Tax collection schedules (whether by the City or designee thereof or both); the costs of collecting the Facilities Special Taxes (whether by the County, the City, or otherwise); the costs of remitting the Facilities Special Taxes to the Trustee; the costs of the Trustee (including its legal counsel) in the discharge of

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the duties required of it under the Indenture; the costs to the City, CFD No. 24 IA3, or any designee thereof of complying with arbitrage rebate requirements or responding to questions from the IRS or SEC pertaining to any Bonds or any audit of any Bonds by the SEC or IRS; the costs to the City, CFD No. 24 IA3, or any designee thereof of providing continuing disclosure regarding the Bonds pursuant to applicable state or federal securities law; the costs associated with preparing Facilities Special Tax disclosure statements and responding to public inquiries regarding the Facilities Special Taxes; the costs of the City, CFD No. 24 IA3, or any designee thereof related to any appeal of the levy or application of the Facilities Special Tax; the costs associated with the release of funds from an escrow account, if any; and the costs associated with computing and preparing the Effective Tax Rate Evaluation, including the Price Point Study. Facilities Administrative Expenses shall also include amounts estimated or advanced by the City or CFD No. 24 IA3 for any other administrative purposes, including, but not limited to, attorney’s fees and other costs related to commencing and pursuing to completion any foreclosure of delinquent Facilities Special Taxes. “Facilities Special Tax” means 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. “Facilities Special Tax Escalation Factor” means two percent (2%) annually. “Facilities Special Tax Requirement” means that amount of Special Tax revenue required in any Fiscal Year for CFD No. 24 IA3 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 CFD No. 24 IA3 Administrator pursuant to the Indenture. “Facilities Special Tax Term” means the earlier of Fiscal Year 2085-2086 or the Fiscal Year occurring 50 years following the Fiscal Year in which the first building permit was issued, or the first series of Bonds was issued within CFD No. 24 IA3.
“Fiscal Year” means the period starting July 1 and ending on the following June 30. “Indenture” means the indenture, fiscal agent agreement, trust agreement, resolution or other instrument pursuant to which Bonds are issued, as modified, amended and/or supplemented from time to time, and any instrument replacing or supplementing the same. “Large Lot Map” means a recorded subdivision map creating larger parcels by land use. The Large Lot Map does not create individual lots for which building permits may be issued for single-family Residential Units.
“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

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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. “Maximum Facilities Special Tax” means the total maximum annual Facilities Special Tax, determined in accordance with the provisions of Section C, which may be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.
“Maximum Facilities Special Tax Rate” means the maximum annual Facilities Special Tax rate for each land use category of Taxable Property, as shown in Attachment A, which may be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.
“Maximum Services Special Tax” means the total maximum annual Services Special Tax, determined in accordance with the provisions of Section D, which may be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.
“Maximum Services Special Tax Rate” means the maximum annual Services Special Tax rate for each land use category of Taxable Property, as shown in Attachment A, which may be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.
“Maximum Special Tax” means, prior to the Transition Year, the total annual Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) and Maximum Services Special Tax, determined in accordance with the provisions of Section C and Section D, which may be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.

Beginning in the Transition Year, “Maximum Special Tax”, means the total annual Maximum Transition Services Special Tax, determined in accordance with the provisions of Section D, which may be levied in any Fiscal Year following the Transition Event on any Assessor’s Parcel of Taxable Property “Maximum Total Effective Tax Rate” means 1.80%, unless the City determines, in its sole discretion, that a higher Maximum Total Effective Tax Rate is appropriate. “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 and 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. “Minimum Facilities Revenue” means the minimum amount of total CFD No. 24 IA3 Maximum Facilities Special Tax, as adjusted annually by the Facilities Special Tax Escalation Factor, less any Maximum Facilities Special Tax amounts partially prepaid pursuant to Section L. The Minimum Facilities Revenue, based on Planned Development, is set forth in Attachment B of this Rate and Method of Apportionment. Following the Transition Event, the Minimum Facilities Revenue shall be zero.
“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

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Parcel with a permitted density range of 12-20 Residential Units per Acre and more fully described in the Folsom Plan Area Specific Plan adopted on June 28, 2011 and as amended by the City Council. “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. “Open Space Property” means property within the boundaries of CFD No. 24 IA3 which (a) has been designated with specific boundaries and acreage on a Small Lot Final Subdivision Map as open space, or (b) is classified by the City zoning code or County Assessor as open space, or (c) has been irrevocably offered for dedication as open space to the federal government, the State of California, the County, the City, any other public agency, a private, non-profit organization, or (d) is encumbered by an easement or other restriction required by the City limiting the use of such property to open space. “Outstanding Bonds” means all Bonds, which remain outstanding as defined in the Indenture pursuant to which such Bonds were issued.
“Pay as You Go Costs” means that portion of the Facilities Special Tax Requirement attributable to the direct payment for the acquisition and/or construction of public improvements, which are authorized to be financed by CFD No. 24 IA3.
“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. “Planned Development” means the planned number of Residential Lots, MHD Multi-Family Attached Property Acreage, MMD Multi-Family Attached Property Acreage, and Non-Residential Property Acreage planned within CFD No. 24 IA3, set forth in Attachment B or, following the Effective Tax Rate Evaluation, Attachment D of this Rate and Method of Apportionment, as amended by the future recordation of all Large Lot Maps and Small Lot Final Subdivision Maps within CFD No. 24 IA3. “Price Point Study” means an analysis, prepared by an independent firm, to verify the estimated average sales price within each land use category of Residential Property given the project location and current market conditions.
“Property Owner Association Property” means any property within the boundaries of CFD No. 24 IA3, which is (a) owned by a property owner association or (b) designated with specific boundaries

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and Acreage on a Small Lot Final Subdivision Map as property owner association property. As used in this definition, a property owner association includes any master or sub-association. “Proportionately” means for Taxable Property that the ratio of the Facilities Special Tax levy to the Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) and the Services Special Tax levy to the Maximum Services Special Tax is equal for all Assessors’ Parcels within each classification (Developed Property, Single Family Final Map Property, Permit Ready Multi- Family/Non-Residential Property, Large Lot Property, etc.) within CFD No. 24 IA3. “Public Property” means any property within the boundaries of CFD No. 24 IA3, which (a) is owned by a public agency, (b) has been irrevocably offered for dedication to a public agency, or (c) is designated with specific boundaries and Acreage on a Small Lot Final Subdivision Map as property, which will be owned by a public agency. For purposes of this definition, a public agency includes the federal government, the State of California, the County, the City, or any other public agency. “Residential Lot” means an individual lot of land for which a building permit could be issued to construct a Residential Unit.
“Residential Property” means, for each Fiscal Year, all Taxable Property for which a building permit could be issued for purposes of constructing Residential Units, including Single-Family Detached Property – SF/SFHD Zoning, Single-Family Detached Property – MLD Zoning, MHD Multi-Family Attached Property, and MMD Multi-Family Attached Property. “Residential Unit” means a residential dwelling unit, including Accessory Dwelling Units, as allowed by the City zoning code.
“Services Administrative Expenses” means the actual or reasonably estimated costs directly related to the administration of the Services Special Tax including, but not limited to, the following: the costs of computing the Services Special Taxes and preparing the annual Services Special Tax collection schedules (whether by the City or designee thereof or both); the costs of collecting the Services Special Taxes (whether by the County, the City, or otherwise); the costs associated with preparing Special Tax disclosure statements and responding to public inquiries regarding the Services Special Tax; and the costs of the City, CFD No. 24 IA3, or any designee thereof related to any appeal of the levy or application of the Services Special Tax. Services Administrative Expenses shall also include amounts estimated or advanced by the City or CFD No. 24 IA3 for any other administrative purposes related to the Services Special Tax.
“Services Special Tax” means, prior to the Transition Event, the annual Special Tax to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property to fund the Services Special Tax Requirement.
“Services Special Tax Escalation Factor” means the maximum of two percent (2%) or the June annualized percentage change of the Consumer Price Index for all Urban Consumers, for the San Francisco-Oakland-San Jose area, not to exceed four percent (4%). “Services Special Tax Requirement” means the amount of Services Special Tax revenue required for CFD No. 24 IA3, before the Transition Year, to (i) pay Services Administrative Expenses in an amount

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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 CFD No. 24 IA3 Administrator.
“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 and 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 – SF/SFHD 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.
“Special Tax” means, before the Transition Year, 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.

Beginning in the Transition Year, the annual Transition Services Special Tax to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property to fund the Transition Services Special Tax Requirement.
“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. “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 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.
“Small Lot Final Subdivision Map” means a subdivision of property created by recordation of a final subdivision map, parcel map or lot line adjustment, approved by the City pursuant to the Subdivision

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Map Act (California Government Code Section 66410 et seq.) or recordation of a condominium plan pursuant to California Civil Code 1352, that creates individual lots for which building permits may be issued for Residential Units without further subdivision of such property. “State” means the State of California.
“Taxable Property” means all of the Assessor’s Parcels within the boundaries of CFD No. 24 IA3 that are not exempt from the CFD No. 24 IA3 Special Tax pursuant to law or Section F below. “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 reflect the actual property tax rates levied upon Taxable Property in the Fiscal Year that the Effective Tax Rate Evaluation is completed.
“Transition Event” means the earlier of (i) Fiscal Year 2085-2086 or (ii) the Fiscal Year when the CFD No. 24 IA3 Administrator determines that both of the following events have occurred (1) all Bonds secured by the levy and collection of the Facilities Special Tax in CFD No. 24 IA3 have been fully repaid and the City determines that no additional Bonds are to be issued, and (2) all Facilities Administrative Expenses have been paid or reimbursed to CFD No. 24 IA3. “Transition Services Administrative Expenses” means the actual or reasonably estimated costs directly related to the administration of the Transition Services Special Tax including, but not limited to, the following: the costs of computing the Transition Services Special Taxes and preparing the annual Transition Services Special Tax collection schedules (whether by the City or designee thereof or both); the costs of collecting the Transition Services Special Taxes (whether by the County, the City, or otherwise); the costs associated with preparing Special Tax disclosure statements and responding to public inquiries regarding the Transition Services Special Tax; and the costs of the City, CFD No. 24 IA3, or any designee thereof related to any appeal of the levy or application of the Transition Services Special Tax. Transition Services Administrative Expenses shall also include amounts estimated or advanced by the City or CFD No. 24 IA3 for any other administrative purposes related to the Transition Services Special Tax.
“Transition Services Special Tax” means, after the Transition Event, the annual Special Tax to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property to fund the Transition Services Special Tax Requirement.
“Transition Services Special Tax Escalation Factor” means the maximum of two percent (2%) or the June annualized percentage change of the Consumer Price Index for all Urban Consumers, for the San Francisco-Oakland-San Jose area, not to exceed four percent (4%). “Transition Services Special Tax Rate” means, calculated in the Transition Year, the amount equal to the prior year’s Maximum Services Special Tax Rate plus fifty percent (50%) of the prior year’s

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Maximum Facilities Special Tax Rate. The Transition Services Special Tax Escalation Factor shall be applied beginning in the Transition Year. Following the Transition Year, the Transition Services Special Tax Rate shall be equal to the prior year’s Transition Services Special Tax Rate, increased by the Transition Services Special Tax Escalation Factor.
“Transition Services Special Tax Requirement” Beginning in the Transition Year, to (i) pay Transition 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, replacement and contingency funds, capital improvement funds, or reserve funds related to the Authorized Services expenses; (iv) pay for reasonably anticipated delinquent Transition Services Special Taxes based on the delinquency rate for Transition Services Special Taxes levied in the previous Fiscal Year; less (v) a credit for funds available to reduce the annual Transition Services Special Tax levy as determined by the CFD No. 24 IA3 Administrator.
“Transition Year” means the first year in which the CFD No. 24 IA3 Administrator determines that the Transition Event occurred in the prior Fiscal Year.
“Trustee” means the entity appointed pursuant to an Indenture to act as the trustee, fiscal agent, or paying agent or a combination thereof.
“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.
“Welfare Exempt Property” means, in any Fiscal Year, all Parcels within the boundaries of CFD No. 24 IA3 that (a) have been granted a welfare exemption by the County under subdivision (g) of Section 214 of the Revenue and Taxation Code indicated in the Assessor’s Data finalized as of January 1 of the previous Fiscal Year, and (b) are exempt from the Special Tax pursuant to Section 53340(c) of the Act.

Pursuant to Section 53340(c) of the Act, after the issuance of the first series of Bonds, as applicable, any Assessor’s Parcels that receives a welfare exemption under subdivision (g) of Section 214 of the Revenue and Taxation Code shall not be classified as Welfare Exempt Property and will be subject to the Facilities Special Tax.

B. ASSIGNMENT TO LAND USE CATEGORIES
Each Fiscal Year, using City and County records, City zoning information, and land use development plans, all Assessor’s Parcels within the boundaries of CFD No. 24 IA3 shall be designated as either Taxable Property or Exempt Property.

All Taxable Property shall 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 determined pursuant to Sections C and D below.

C. FACILITIES SPECIAL TAX

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Prior to the Transition Year, a Maximum Facilities Special Tax shall be assigned to all Taxable Property within CFD No. 24 IA3 according to the Maximum Facilities Special Tax Rates set forth in Attachment A of this Rate and Method of Apportionment.

Once assigned, the sum of the total Maximum Facilities Special Tax shall be equal to or greater than the Minimum Facilities Revenue, unless adjusted by an Effective Tax Rate Evaluation as described below. The Minimum Facilities Revenue for Fiscal Year 2026-2027 is set forth in Attachment B of this Rate and Method of Apportionment.

On each July 1, commencing on July 1, 2027, the Maximum Facilities Special Tax Rates and Minimum Facilities Revenue shall be increased by the Facilities Special Tax Escalation Factor of the Maximum Facilities Special Tax Rates and Minimum Facilities Revenue in effect for the previous Fiscal Year.

C.1. Future Assessor’s Parcel Changes – Prior to an Effective Tax Rate Evaluation The 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 sum of the total Maximum Facilities Special Tax revenue is not less than the Minimum Facilities Revenue set forth in Attachment B of this Rate and Method of Apportionment.

Undeveloped Property Subdividing into Large Lot Property When Undeveloped Property subdivides into Large Lot Property, the Maximum Facilities Special Tax shall be calculated for all Taxable Property as if all of the Taxable Property was classified as Developed Property. The expected Developed Property Maximum Facilities Special Tax for any Large Lot Property and any remaining Undeveloped Property shall be based upon the Planned Development for the Large Lot Property and remaining Undeveloped Property.

If the sum of the total expected Developed Property Maximum Facilities Special Tax generated by all of the Taxable Property is greater than or equal to the Minimum Facilities Revenue, there will be no further adjustments to the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non-Residential Property Maximum Facilities Special Tax Rates for the Large Lot Property created from the Undeveloped Property subdivision.

If the sum of the total expected Developed Property Maximum Facilities Special Tax is less than the Minimum Facilities Revenue, the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non-Residential Property Maximum Facilities Special Tax Rates shall be Proportionately increased, on the Large Lot Property created from the Undeveloped Property subdivision, until the sum of the total expected Developed Property Maximum Facilities Special Tax is equal to the Minimum Facilities Revenue. Further, if the sum of the total current Maximum Facilities Special Tax is less than the Minimum Facilities Revenue, the Maximum Facilities Special Tax Rates for the Large Lot Property and any remaining Undeveloped Property created from the Undeveloped Property subdivision shall be Proportionately increased until the sum of the total current Maximum Facilities Special Tax is equal to the Minimum Facilities Revenue. Attachment B of this Rate and Method of Apportionment shall be updated to reflect any increases to the Maximum Facilities Special Tax Rates from the Undeveloped Property subdivision. The

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Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non- Residential Property Maximum Facilities Special Tax Rates shall not be adjusted for any Taxable Property already classified as Developed Property, Small Lot Final Map Property or Permit Ready Multi-Family/Non-Residential Property.

Large Lot Property Subdividing into Small Lot Final Map Property and Permit Ready Multi- Family/Non-Residential Property
When Large Lot Property subdivides into Small Lot Final Map Property or Permit Ready Multi- Family/Non-Residential Property, the Maximum Facilities Special Tax shall be calculated for all Taxable Property as if all of the Taxable Property was classified as Developed Property. If the Large Lot Property subdivision also creates Small Lot Final Map Remainder Property, the expected Developed Property Maximum Facilities Special Tax for the Small Lot Final Map Remainder Property shall be based upon the Planned Development for the Small Lot Final Map Remainder Property. The expected Developed Property Maximum Facilities Special Tax for any remaining Large Lot Property and Undeveloped Property shall be based upon the Planned Development of the Large Lot Property and the Undeveloped Property.

If the sum of the total expected Developed Property Maximum Facilities Special Tax is greater than or equal to the Minimum Facilities Revenue, there will be no further adjustments to the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non- Residential Property Maximum Facilities Special Tax Rates for the Small Lot Final Map Property, Small Lot Final Map Remainder Property and Permit Ready Multi-Family/Non-Residential Property created from the Large Lot Property subdivision.

If the sum of the total expected Developed Property Maximum Facilities Special Tax is less than the Minimum Facilities Revenue, and such difference is not eliminated by the partial prepayment of the Effective Tax Rate Evaluation Maximum Facilities Special Tax pursuant to Section L, the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non- Residential Property Maximum Facilities Special Tax Rates shall be Proportionately increased, on the Small Lot Final Map Property, Small Lot Final Map Remainder Property and Permit Ready Multi-Family/Non-Residential Property created from the Large Lot Property subdivision, until the sum of the total expected Developed Property Maximum Facilities Special Tax is equal to the Minimum Facilities Revenue. Attachment B of this Rate and Method of Apportionment shall be updated to reflect any increases to the Maximum Facilities Special Tax Rates from the Large Lot Property subdivision. The Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non-Residential Property Maximum Facilities Special Tax Rates shall not be adjusted for any Taxable Property already classified as Developed Property, Small Lot Final Map Property or Permit Ready Multi-Family/Non-Residential Property created prior to the Large Lot Property subdivision.

C.2. Effective Tax Rate Evaluation
Prior to the issuance of the first series of Bonds within CFD No. 24 IA3 an Effective Tax Rate Evaluation will be completed. Following the Effective Tax Rate Evaluation, Attachment C of this

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Rate and Method of Apportionment will be updated to reflect the Effective Tax Rate Evaluation Maximum Facilities Special Tax Rate for all Taxable Property in CFD No. 24 IA3.

Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates As part of the Effective Tax Rate Evaluation, a Price Point Study will be prepared and an estimated average sales prices will be established for each Residential Property land use category. Using the estimated average sales price information determined in the Price Point Study, the Total Estimated Tax Burden and Total Effective Tax Rate will be calculated, using the Developed Property Maximum Facilities Special Tax Rates set forth in Attachment A, for each Residential Property land use category. If the calculated Total Effective Tax Rate is less than or equal to the Total Maximum Effective Tax Rate for a Residential Property land use category, the Maximum Facilities Special Tax Rate shall not be adjusted and will be assigned using the Developed Property Maximum Facilities Special Tax Rates set forth in Attachment A. Attachment C of this Rate and Method of Apportionment will be updated to set forth the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rate for each Residential Property land use category.

If the Total Effective Tax Rate for any Residential Property land use category exceeds the Total Maximum Effective Tax Rate, the Developed Property Maximum Facilities Special Tax Rate set forth in Attachment A shall be reduced until the Total Effective Tax Rate is less than or equal to the Total Maximum Effective Tax Rate for that Residential Property land use category.

Attachment C of this Rate and Method of Apportionment will be updated to set forth the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rate for each Residential Property land use category.

Effective Tax Rate Evaluation Minimum Facilities Revenue As a result of the Effective Tax Rate Evaluation, if the calculated Total Effective Tax Rate is less than or equal to the Total Maximum Effective Tax Rate for a Residential Property land use category used in the Minimum Facilities Revenue calculation, the Developed Property Maximum Facilities Special Tax Rate for the applicable Residential Property land use category shall not be adjusted and the Effective Tax Rate Evaluation Developed Property Maximum Facilities Special Tax Rate will be assigned using the Developed Property Maximum Facilities Special Tax Rates set forth in Attachment B. Attachment D of this Rate and Method of Apportionment will be updated to set forth the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rate for each Residential Property land use category and the Effective Tax Rate Evaluation Minimum Facilities Revenue.

If the calculated Total Effective Tax Rate exceeds the Total Maximum Effective Tax Rate for a Residential Property land use category used in the Minimum Facilities Revenue calculation, the Effective Tax Rate Evaluation Developed Property Maximum Facilities Special Tax Rate will be assigned using the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates set forth in Attachment C. Attachment D of this Rate and Method of Apportionment will be updated to set forth the Developed Property Effective Tax Rate Evaluation Maximum

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Facilities Special Tax Rate for each Residential Property land use category and the Effective Tax Rate Evaluation Minimum Facilities Revenue.

C.3. Future Assessor’s Parcel Changes – After an Effective Tax Rate Evaluation 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 sum of the total Effective Tax Rate Evaluation Maximum Facilities Special Tax revenue is not less than the total Effective Tax Rate Evaluation Minimum Facilities Revenue set forth in Attachment D of this Rate and Method of Apportionment.

Undeveloped Property Subdividing into Large Lot Property When Undeveloped Property subdivides into Large Lot Property, the Effective Tax Rate Evaluation Maximum Facilities Special Tax shall be calculated for all Taxable Property as if all of the Taxable Property was classified as Developed Property. The expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax for any Large Lot Property and any remaining Undeveloped Property shall be based upon the Planned Development for the Large Lot Property and remaining Undeveloped Property.

If the sum of the total expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax generated by all of the Taxable Property is greater than or equal to the Effective Tax Rate Evaluation Minimum Facilities Revenue, there will be no further adjustments to the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non- Residential Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates for the Large Lot Property created from the Undeveloped Property subdivision.

If the sum of the total expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax is less than the Effective Tax Rate Evaluation Minimum Facilities Revenue, the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non- Residential Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates shall be Proportionately increased, on the Large Lot Property created from the Undeveloped Property subdivision, until the sum of the total expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax is equal to the Effective Tax Rate Evaluation Minimum Facilities Revenue. Further, if the sum of the total current Effective Tax Rate Evaluation Maximum Facilities Special Tax is less than the Effective Tax Rate Evaluation Minimum Facilities Revenue, the Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates for the Large Lot Property and any remaining Undeveloped Property created from the Undeveloped Property subdivision shall be Proportionately increased until the sum of the total current Effective Tax Rate Evaluation Maximum Facilities Special Tax is equal to the Effective Tax Rate Evaluation Minimum Facilities Revenue. Attachment D of this Rate and Method of Apportionment shall be updated to reflect any increases to the Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates from the Undeveloped Property subdivision. The Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non-Residential Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates shall not be adjusted for any Taxable Property already classified as

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Developed Property, Small Lot Final Map Property or Permit Ready Multi-Family/Non-Residential Property.

Large Lot Property Subdividing into Small Lot Final Map Property and Permit Ready Multi- Family/Non-Residential Property
When Large Lot Property subdivides into Small Lot Final Map Property or Permit Ready Multi- Family/Non-Residential Property, the Effective Tax Rate Evaluation Maximum Facilities Special Tax shall be calculated for all Taxable Property as if all of the Taxable Property was classified as Developed Property. If the Large Lot Property subdivision also creates Small Lot Final Map Remainder Property, the expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax for the Small Lot Final Map Remainder Property shall be based upon the Planned Development for the Small Lot Final Map Remainder Property. The expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax for any remaining Large Lot Property and Undeveloped Property shall be based upon the Planned Development of the Large Lot Property and the Undeveloped Property.

If the sum of the total expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax is greater than or equal to the Effective Tax Rate Evaluation Minimum Facilities Revenue, there will be no further adjustments to the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non-Residential Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates for the Small Lot Final Map Property, Small Lot Final Map Remainder Property and Permit Ready Multi-Family/Non-Residential Property created from the Large Lot Property subdivision.

If the sum of the total expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax is less than the Effective Tax Rate Evaluation Minimum Facilities Revenue, and such difference is not eliminated by the partial prepayment of the Effective Tax Rate Evaluation Maximum Facilities Special Tax pursuant to Section L, the Developed Property, Small Lot Final Map Property and Permit Ready Multi-Family/Non-Residential Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates shall be Proportionately increased, on the Small Lot Final Map Property, Small Lot Final Map Remainder Property and Permit Ready Multi- Family/Non-Residential Property created from the Large Lot Property subdivision, until the sum of the total expected Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax is equal to the Effective Tax Rate Evaluation Minimum Facilities Revenue. Attachment D of this Rate and Method of Apportionment shall be updated to reflect any increases to the Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates from the Large Lot Property subdivision. The Developed Property, Small Lot Final Map Property and Permit Ready Multi- Family/Non-Residential Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates shall not be adjusted for any Taxable Property already classified as Developed Property, Small Lot Final Map Property or Permit Ready Multi-Family/Non-Residential Property created prior to the Large Lot Property subdivision.

C.4. Method of Apportionment of Facilities Special Tax

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Using the definitions and procedures described herein, the CFD No. 24 IA3 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 until the Transition Year as follows:

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

Second: 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 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.

Third: 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 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.

Fourth: 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 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.

Fifth: 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 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.

After an Effective Tax Rate Evaluation
First: 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.

Second: 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.

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Third: 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.

Fourth: 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.

Fifth: 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.

D. SERVICES SPECIAL TAX
A Services Special Tax shall be assigned to all Taxable Property within CFD No. 24 IA3 according to the Maximum Services Special Tax Rates set forth in Attachment A of this Rate and Method of Apportionment.

D.1. Prior to the Transition Event - Increase in the Maximum Services Special Tax Prior to the Transition Event, on each July 1, commencing on July 1, 2027, the Maximum Services Special Tax Rates shall be increased by the Services Special Tax Escalation Factor of the Maximum Services Special Tax Rates in effect for the previous Fiscal Year.

D.2. Prior to the Transition Event - Method of Apportionment of Services Special Tax If, in any Fiscal Year prior to the Transition Year, the Facilities Special Tax is levied against each Assessor’s Parcel of Taxable Property within CFD No. 24 IA3 and the Facilities Special Tax revenues generated are insufficient to pay the Facilities Special Tax Requirement such shortfall shall be deemed a component of the Services Special Tax Requirement in that Fiscal Year, and proceeds from the levy of the Services Special Tax shall first be applied to mitigate the shortfall in the Facilities Special Tax Requirement before being used to pay for Authorized Services. The Services Special Tax revenue shall not be applied to any Facilities Special Tax Requirement shortfalls attributable to Pay As You Go Costs authorized to be financed by CFD No. 24 IA3.

Using the definitions and procedures described herein, the CFD No. 24 IA3 Administrator shall determine the Services Special Tax Requirement and levy the Services Special Tax until the amount of Services Special Tax equals the Services Special Tax Requirement. The Services Special Tax shall be levied each Fiscal Year as follows:

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City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 3 Page 17
First: 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.

Second: 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 100% of the Maximum Services Special Tax in order to satisfy the Services Special Tax Requirement.

Third: 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 100% of the Maximum Services Special Tax in order to satisfy the Services Special Tax Requirement.

Fourth: If additional monies are needed to satisfy the Services Special Tax Requirement after the 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.

Fifth: If additional monies are needed to satisfy the Services Special Tax Requirement after the three steps have been completed, the Services Special Tax shall be levied Proportionately on all Undeveloped Property at a rate up to 100% of the Maximum Services Special Tax in order to satisfy the Services Special Tax Requirement.

E. TRANSITION SERVICES SPECIAL TAX
A Transition Services Special Tax shall be assigned to all Taxable Property within CFD No. 24 IA3 according to the Maximum Transition Services Special Tax Rates set forth in Attachment A of this Rate and Method of Apportionment.

E.1. After the Transition Event – Method of Apportionment of Transition Services Special Tax Using the definitions and procedures described herein, the CFD No. 24 IA3 Administrator shall determine the Transition Services Special Tax Requirement and levy the Transition Services Special Tax until the amount of Transition Services Special Tax equals the Transition Services Special Tax Requirement. The Transition Services Special Tax shall be levied each Fiscal Year as follows:

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

Second: If additional monies are needed to satisfy the Transition Services Special Tax Requirement after the first step has been completed, the Transition Services Special Tax shall be levied Proportionately on all Small Lot Final Map Property at a rate up to 100% of the Maximum Transition Services Special Tax in order to satisfy the Transition Services Special Tax Requirement.

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Third: If additional monies are needed to satisfy the Transition Services Special Tax Requirement after the first two steps have been completed, the Transition Services Special Tax shall be levied Proportionately on all Permit Ready Multi-Family/Non-Residential Property at a rate up to 100% of the Maximum Transition Services Special Tax in order to satisfy the Transition Services Special Tax Requirement.

Fourth: If additional monies are needed to satisfy the Transition Services Special Tax Requirement after the three steps have been completed, the Transition Services Special Tax shall be levied Proportionately on all Large Lot Property at a rate up to 100% of the Maximum Transition Services Special Tax in order to satisfy the Transition Services Special Tax Requirement.

Fifth: If additional monies are needed to satisfy the Transition Services Special Tax Requirement after the three steps have been completed, the Transition Services Special Tax shall be levied Proportionately on all Undeveloped Property at a rate up to 100% of the Maximum Transition Services Special Tax in order to satisfy the Transition Services Special Tax Requirement.

F. DELINQUENCIES
Notwithstanding the above, under no circumstances will the CFD No. 24 IA3 Facilities Special Tax levied against any Assessor’s Parcel of Developed Property classified as Residential Property, in any Fiscal Year, be increased as a consequence of the delinquency or default in the payment of the CFD No. 24 IA3 Facilities Special Taxes by the owner or owners of any other Taxable Property by more than ten percent (10%) above the amount that would have been levied against such Assessor’s Parcel in such Fiscal Year had there been no delinquencies or defaults.

G. EXEMPTIONS
The CFD No. 24 IA3 Administrator shall classify the following as Exempt Property: Public Property, Property Owner Association Property, Open Space Property, and Assessor’s Parcels with public or utility easements making impractical their utilization for any use other than the purposes set forth in the easement.

The Maximum Facilities Special Tax obligation or, if applicable, the Effective Tax Rate Evaluation Maximum Facilities Special Tax obligation for Taxable Property which will be transferred or dedicated to a public agency and will be classified as Public Property may be fully prepaid by the seller, pursuant to Section L, prior to the transfer/dedication of such Taxable Property. Until the Maximum Facilities Special Tax obligation or, if applicable, the Effective Tax Rate Evaluation Maximum Facilities Special Tax obligation for any such Taxable Property is prepaid, the Taxable Property shall continue to be subject to the levy of the Facilities Special Tax. An exception to this may be made if an Assessor’s Parcel of Public Property, such as a school site, is relocated to an Assessor’s Parcel of Taxable Property, in which case the Assessor’s Parcel of previously Public Property becomes Taxable Property and the Assessor’s Parcel of previously Taxable Property becomes Public Property. This trading of an Assessor’s Parcel from Taxable Property to Public Property will be permitted to the extent there is no loss in Maximum Facilities Special Tax revenue or, if applicable, Effective Tax Rate Evaluation Maximum Facilities Special Tax revenue, and the transfer is agreed to by the owners of all Assessor’s Parcels involved in the transfer and the City Council.

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City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 3 Page 19
If the use of an Assessor’s Parcel changes so that such Assessor’s Parcel is no longer eligible to be classified as one of the uses set forth in Section G.1. above that would make such Assessor’s Parcel eligible to continue to be classified as Exempt Property, such Assessor’s Parcel shall cease to be classified as Exempt Property and shall be deemed to be Taxable Property and subject to the Special Tax.

No Special Tax shall be levied on any Assessor’s Parcel in any Fiscal Year in which such Assessor’s Parcel is classified as Welfare Exempt Property; however, pursuant to Section 53340(c) of the Act, after the issuance of the first series of Bonds, as applicable, any Assessor’s Parcel that receives a welfare exemption under subdivision (g) of Section 214 of the Revenue and Taxation Code shall not be classified as Welfare Exempt Property and will be subject to the Facilities Special Tax.

H. TRANSFERS
Prior to the issuance of the first series of Bonds within CFD No. 24 IA3, the City may permit the transfer of Maximum Facilities Special Tax or Effective Tax Rate Evaluation Maximum Facilities Special Tax from one Assessor’s Parcel to another Assessor’s Parcel. Before recordation of a Small Lot Final Subdivision Map, if a subdivision map is required, the City may permit a transfer if the number of planned Residential Units, Multi-Family Attached Property Acreage, or Non-Residential Property Acreage is transferred from one Assessor’s Parcel(s) to another Assessor’s Parcel(s) in any portion of Large Lot Property. The City may, in its sole discretion, allow for a transfer of the Maximum Facilities Special Tax or Effective Tax Rate Evaluation Maximum Facilities Special Tax from one Assessor’s Parcel to another Assessor’s Parcel provided such a transfer shall be allowed only if (1) all adjustments are agreed to in writing by the affected property owners and the City’s Finance Director, and (2) there is no reduction in the sum of the total Maximum Facilities Special Tax or sum of the total Effective Tax Rate Evaluation Maximum Facilities Special Tax as a result of the transfer. Should a transfer result in an amendment to Attachment B or, following an Effective Tax Rate Evaluation, Attachment D of this Rate and Method of Apportionment, the requesting property owner shall bear the costs to affect the transfer in the CFD No. 24 IA3 records and prepare the required amendments to Attachment B or, following an Effective Tax Rate Evaluation, Attachment D of this Rate and Method of Apportionment.

I. INTERPRETATIONS
The City reserves the right to make minor administrative and technical changes to this document that do not materially affect the Rate and Method of Apportionment of Special Tax. In addition, the interpretation and application of any section of this document shall be at the City’s discretion.

Interpretations may be made by the City by ordinance or resolution for purposes of clarifying any vagueness or ambiguity in this Rate and Method of Apportionment of Special Tax.

J. REVIEW/APPEALS
The CFD No. 24 IA3 Administrator may establish such procedures, as it deems necessary to undertake the review of any such appeal. The CFD No. 24 IA3 Administrator shall interpret this Rate and Method of Apportionment of Special Tax and make determinations relative to the annual administration of the Special Tax and any property owner appeals, as herein specified.

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City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 3 Page 20
Any property owner may file a written appeal of the Special Tax with the CFD No. 24 IA3 Administrator claiming that the amount or application of the Special Tax is not correct. The appeal must be filed not later than one calendar year after having paid the Special Taxes that are disputed, and the appellant must be current in all payments of Special Taxes. In addition, during the term of the appeal process, all Special Taxes levied must be paid on or before the payment date established when the levy was made. The appeal must specify the reasons why the appellant claims the Special Taxes are in error.

The CFD No. 24 IA3 Administrator shall review the appeal, meet with the appellant if the CFD No. 24 IA3 Administrator deems necessary, and advise the appellant of its determination.

If the property owner disagrees with the CFD No. 24 IA3 Administrator’s decision relative to the appeal, the owner may file a written notice with the City Manager appealing the amount of the Special Tax levied on such Assessor’s Parcel. If following such consultation and action (if any by the City Manager), the property owner believes such error still exists, such person may file a written notice with the City Council appealing the amount of the Special Tax levied on such Assessor’s Parcel. The decision of the City shall be final and binding to all persons. If the decision of the CFD No. 24 IA3 Administrator or subsequent decision by the City Manager or City Council requires the Special Taxes to be modified or changed in favor of the property owner, no cash refund shall be made for prior years’ Special Taxes, but an adjustment shall be made to credit future Special Taxes. This procedure shall be exclusive and its exhaustion by any property owner shall be a condition precedent to filing any legal action by such owner.

K. MANNER OF COLLECTION
The annual Special Tax shall be collected in the same manner and at the same time as ordinary ad valorem property taxes; provided, however, that CFD No. 24 IA3, may, at the sole discretion of the City, directly bill the Special Tax, may collect Special Taxes at a different time or in a different manner as necessary to meet its financial obligations, and may covenant to foreclose and may actually foreclose on Assessor’s Parcels of Taxable Property that are delinquent in the payment of Special Taxes.

L. PREPAYMENT IN PART OF FACILITIES SPECIAL TAX
The Facilities Special Tax obligation of an Assessor’s Parcel of Taxable Property may be partially prepaid as described herein; provided that there are no delinquent Special Taxes with respect to such Assessor’s Parcel at the time of partial prepayment. An owner of an Assessor’s Parcel intending to partially prepay the Facilities Special Tax obligation shall provide the CFD No. 24 IA3 Administrator with written notice of intent to partially prepay. Within 30 days of receipt of such written notice, the CFD No. 24 IA3 Administrator shall notify such owner of the partial prepayment amount of such Assessor’s Parcel. Any partial prepayment must be submitted at least 60 days before the next occurring bond redemption date, and the proceeds of such prepayment shall be provided to the Trustee for application toward bond redemption in accordance with the Indenture. The CFD No. 24 IA3 Administrator may charge a fee for providing this service.

L.1. Partial Prepayment Amount

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City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 3 Page 21
The Facilities Special Tax may be prepaid in an amount determined at the time of prepayment based on the portion of Bonds then outstanding; provided, however, that no partial prepayment shall be accepted in an amount equal to an annual Special Tax amount less than the annual Transition Services Special Tax rate escalated to the then current fiscal year less the then current Services Special Tax rate.

Step 1: Determine the current Fiscal Year Maximum Facilities Special Tax for the Assessor’s Parcel based on the assignment of the Maximum Facilities Special Tax described in Section C above. If an Effective Tax Rate Evaluation has occurred, determine the current Fiscal Year Effective Tax Rate Evaluation Maximum Facilities Special Tax for the Assessor’s Parcel based on the assignment of the Effective Tax Rate Evaluation Maximum Facilities Special Tax described in Section C above.

If the Assessor’s Parcel is not already classified as Developed Property, the Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) shall be assigned as though the Assessor’s Parcel was already designated as Developed Property.

Step 2: Calculate the annual revenue produced, by annually applying the Facilities Special Tax Escalation Factor, from the Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) from the date of prepayment through the earlier of the end of the Facilities Special Tax Term or the Transition Event, except that this final date may be amended by the City no later than the time of the calculation of the prepayment. If the final date used in the prepayment calculation is amended by the City, this amended final date shall apply to any and all prepayment calculations from that point forward.

Step 3: Calculate the present value of the Assessor’s Parcel’s annual Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) revenue stream determined in Step 2. The present value shall be calculated using a discount rate that earns a rate of interest that, when the prepayment is invested in City permitted and available investments, would produce annual revenues equal to the amounts calculated in Step 2.

If there are Outstanding Bonds at the time of the Partial Prepayment Amount calculation, the Partial Prepayment Amount shall be first allocated to the Redemption Amount. If the Partial Prepayment Amount is insufficient to fund the Redemption Amount, then the Partial Prepayment Amount shall be increased to equal the Redemption Amount.

The Redemption Amount is calculated as follows:

Step 1: Divide the Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) computed pursuant to Step 1 of Section L.1 by the total Maximum Facilities Special Taxes (or total Effective Tax Rate Evaluation Maximum Facilities Special Taxes) for the entire CFD No. 24 IA3, based on the Maximum Facilities Special Taxes (or Effective Tax Rate Evaluation Maximum Facilities Special Taxes) that could be charged in the current Fiscal Year if all Taxable Property were designated as Developed Property, excluding any Assessor’s Parcels which have prepaid the Maximum Facilities Special Tax (or Effective Tax Rate Evaluation Maximum Facilities Special Tax) obligation (the “Prepayment Quotient”).

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Step 2: Multiply the Prepayment Quotient by the Outstanding Bonds to compute the amount of Outstanding Bonds to be redeemed (the “Bond Redemption Amount”).

Step 3: Multiply the Bond Redemption Amount by the applicable redemption premium, if any, on the Outstanding Bonds to be redeemed.

Step 4: Compute the amount needed to pay interest on the Bond Redemption Amount from the first Bond interest payment date following the current Fiscal Year until the earliest redemption date for the Outstanding Bonds.

Step 5: Determine that portion of Facilities Special Taxes levied on the Assessor’s Parcel in the current Fiscal Year to satisfy the Facilities Special Tax Requirement, which have not yet been paid.

Step 6: A reserve fund credit shall equal the lesser of: (a) the expected reduction in the reserve requirement (as defined in the Indenture for the Bonds), if any, associated with the redemption of Outstanding Bonds as a result of the partial prepayment, or (b) the amount derived by subtracting the new reserve requirement (as defined in the Indenture for the Bonds) in effect after the redemption of Outstanding Bonds as a result of the partial prepayment from the balance in the reserve fund on the prepayment date, but in no event shall such amount be less than zero. Such reserve fund credit will not decrease the balance in the reserve fund below the new reserve requirement.

Step 7: If any capitalized interest for the Outstanding Bonds will not have been expended at the time of the first interest and/or principal payment following the current Fiscal Year, a capitalized interest credit shall be calculated by multiplying the quotient computed pursuant to Step 1 by the expected balance in the capitalized interest fund after such first interest payment.

Step 8: The redemption amount is equal to the sum of the amounts computed pursuant to Steps 2, 3, 4, and 5, less the amount computed pursuant to Steps 6 and 7 (the “Redemption Amount”).

If the Partial Prepayment Amount exceeds the Redemption Amount, then any remaining Partial Prepayment Amount, after allocating the Redemption Amount, shall be designated as Pay as You Go Costs.

The Partial Prepayment Amount shall include any fees or expenses, including the costs of computation of the prepayment, the costs to invest the prepayment proceeds, the cost of redeeming Bonds, and the costs of recording any notices to evidence the prepayment and the redemption (the “Administrative Fees and Expenses”).

In addition, the City has the authority to adjust the Partial Prepayment Amount calculated above if a portion or all of the current property tax bill and the portion attributable to the payment of the Facilities Special Tax has not been used to make an interest and/or principal payment on the Bonds.

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City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 3 Page 23
Notwithstanding the foregoing, no partial prepayment shall be allowed unless the amount of Maximum Facilities Special Taxes (or Effective Tax Rate Evaluation Maximum Facilities Special Taxes), net of any priority administration, if any as defined in the Bond documents, that may be levied on Taxable Property, in each Fiscal Year, both prior to and after the proposed partial prepayment, is at least 1.1 times the annual debt service on all Outstanding Bonds to be paid from the Maximum Facilities Special Taxes (or Effective Tax Rate Evaluation Maximum Facilities Special Taxes) in each Fiscal Year.

M. TERM OF SPECIAL TAX
The Maximum Facilities Special Tax and Effective Tax Rate Evaluation Maximum Facilities Special Tax shall be levied commencing in Fiscal Year 2026-2027 to the extent necessary to fully satisfy the Facilities Special Tax Requirement and shall be levied for the Facilities Special Tax Term.

The Maximum Services Special Tax shall be levied commencing in Fiscal Year 2026-2027 and shall be levied until the Transition Event to the extent necessary to fully satisfy the Services Special Tax Requirement.

The Maximum Transition Services Special Tax shall be levied commencing in the Fiscal Year following the Transition Event in perpetuity, unless and until such time the City determines that revenues are no longer needed to pay the Transition Services Special Tax Requirement.

including Single-Family Detached Property – SF/SFHD Zoning, Single-Family Detached Property – MLD Zoning, MHD Multi-Family Attached Property, and MMD Multi-Family Attached Property.

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City of Folsom - Community Facilities District No. 24 (Alder Creek West) April 1, 2026 Improvement Area 3 Page 24

ATTACHMENT A

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 24 (ALDER CREEK WEST) IMPROVEMENT AREA 3

MAXIMUM SPECIAL TAX RATES
(FISCAL YEAR 2026-2027)
Land Use Category Lot / Village #
2026-2027
Maximum
Facilities Special
Tax Rate(1)
2026-2027
Maximum
Services Special
Tax Rate(2) Taxed Per
Developed Property:

Single-Family Detached Property – SF Zoning 8A $4,237 $695 Residential Lot Single-Family Detached Property – SF Zoning 8A 4,083 695 Residential Lot Single-Family Detached Property – SF Zoning 8B 5,013 869 Residential Lot Single-Family Detached Property – SF Zoning 8C 5,563 816 Residential Lot Single-Family Detached Property – SF Zoning 9A 5,086 796 Residential Lot Single-Family Detached Property – SF Zoning 9B 4,279 653 Residential Lot Small Lot Final Map Property:

Single-Family Detached Property – SF Zoning 2A $4,237 $695 Residential Lot Single-Family Detached Property – SF Zoning 2B 4,083 695 Residential Lot Single-Family Detached Property – SF Zoning 3A 5,013 869 Residential Lot Single-Family Detached Property – SF Zoning 3B 5,563 816 Residential Lot Single-Family Detached Property – SF Zoning 4A 5,086 796 Residential Lot Single-Family Detached Property – SF Zoning 4B 4,279 653 Residential Lot Permit Ready Multi-Family/Non-Residential Property $20,000 N/A Acre Large Lot Property $20,000 N/A Acre
Undeveloped Property $20,000 N/A Acre
(1) On each July 1, commencing on July 1, 2027, the Maximum Facilities Special Tax Rates shall be increased by the Facilities Special Tax Escalation Factor of the Maximum Facilities Special Tax Rates in effect for the previous Fiscal Year. (2) On each July 1, commencing on July 1, 2027, the Maximum Services Special Tax Rates shall be increased by an amount equal to the Services Special Tax Escalation Factor of the Maximum Services Special Tax Rates in effect for the previous Fiscal Year.

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ATTACHMENT B

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 24 (ALDER CREEK WEST) IMPROVEMENT AREA 3

MINIMUM FACILITIES REVENUE
(FISCAL YEAR 2026-2027)
Land Use Category Lot / Village #
Planned Number
of Residential
Lots / Acres
2026-2027
Developed Property
Maximum Facilities
Special Tax Rate(1)(2)
2026-2027
Minimum
Facilities
Revenue (1)(3)
Developed Property:

Single-Family Detached Property – SF Zoning 8A 52 $4,237 $220,324 Single-Family Detached Property – SF Zoning 8A 52 4,083 212,316 Single-Family Detached Property – SF Zoning 8B 27 5,013 135,351 Single-Family Detached Property – SF Zoning 8C 96 5,563 534,048 Single-Family Detached Property – SF Zoning 9A 62 5,086 315,332 Single-Family Detached Property – SF Zoning 9B 102 4,279 436,458 Total Minimum Facilities Revenue $1,853,829
(1) On each July 1, commencing on July 1, 2027, the Developed Property Maximum Facilities Special Tax Rates and Minimum Facilities Revenue shall be increased by the Facilities Special Tax Escalation Factor of the Developed Property Maximum Facilities Special Tax Rates and Minimum Facilities Revenue in effect for the previous Fiscal Year. (2) As a result of future Assessor’s Parcel changes, described in Section C.1, the assigned Maximum Facilities Special Tax Rates for Developed Property may exceed the Developed Property Maximum Facilities Special Tax Rates set forth in this table. (3) The total Minimum Facilities Revenue may be decreased as result of a portion of Maximum Facilities Special Tax obligations being prepaid pursuant to Section L.
(4) Based upon the Developed Property Maximum Facilities Special Tax Rate for Single-Family Detached Property in Lot/Village 8A, 8B, 8C, 9A and 9B.

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(1) Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates will be inserted following the Effective Tax Rate Evaluation. (2) On each July 1, commencing in the Fiscal Year after the Effective Tax Rate Evaluation occurs, the Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates shall be increased by the Facilities Special Tax Escalation Factor of the Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates in effect for the previous Fiscal Year.

ATTACHMENT C

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 24 (ALDER CREEK WEST) IMPROVEMENT AREA 3

EFFECTIVE TAX RATE EVALUATION MAXIMUM FACILITIES SPECIAL TAX RATES (FISCAL YEAR 2026-2027)
Land Use Category
Lot / Village
#
2026-2027
Effective Tax Rate Evaluation
Maximum Facilities Special Tax
Rate(1)(2) Taxed Per
Developed Property:

Single-Family Detached Property – SF Zoning 8A $_________ Residential Lot Single-Family Detached Property – SF Zoning 8A _________ Residential Lot Single-Family Detached Property – SF Zoning 8B _________ Residential Lot Single-Family Detached Property – SF Zoning 8C _________ Residential Lot Single-Family Detached Property – SF Zoning 9A _________ Residential Lot Single-Family Detached Property – SF Zoning 9B _________ Residential Lot Small Lot Final Map Property:

Single-Family Detached Property – SF Zoning 8A $_________ Residential Lot Single-Family Detached Property – SF Zoning 8A _________ Residential Lot Single-Family Detached Property – SF Zoning 8B _________ Residential Lot Single-Family Detached Property – SF Zoning 8C _________ Residential Lot Single-Family Detached Property – SF Zoning 9A _________ Residential Lot Single-Family Detached Property – SF Zoning 9B _________ Residential Lot Permit Ready Multi-Family/Non-Residential Property $_________ Acre Large Lot Property $_________ Acre
Undeveloped Property $_________ Acre

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ATTACHMENT D

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 24 (ALDER CREEK WEST) IMPROVEMENT AREA 3

EFFECTIVE TAX RATE EVALUATION MINIMUM FACILITIES REVENUE (FISCAL YEAR 2026-2027)
Land Use Category Lot / Village #
Planned
Number of
Residential Lots
/ Acres(1)
2026-2027
Developed Property Effective
Tax Rate Evaluation Maximum
Facilities Special Tax Rate(1)(2)(3)
2026-2027
Effective Tax Rate
Evaluation
Minimum Facilities
Revenue(1)(2)(4)
Developed Property:

Single-Family Detached Property – SF Zoning 8A 52 $_________ $_________ Single-Family Detached Property – SF Zoning 8A 52 _________ _________ Single-Family Detached Property – SF Zoning 8B 27 _________ _________ Single-Family Detached Property – SF Zoning 8C 96 _________ _________ Single-Family Detached Property – SF Zoning 9A 62 _________ _________ Single-Family Detached Property – SF Zoning 9B 102 _________ _________ Total Effective Tax Rate Evaluation Minimum
Facilities Revenue(5)
$_________
(1) Planned Number of Residential Units/Acres, Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rate and Effective Tax Rate Evaluation Minimum Facilities Revenue to be inserted following the Effective Tax Rate Evaluation. (2) On each July 1, commencing in the Fiscal Year after the Effective Tax Rate Evaluation occurs, the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates and Effective Tax Rate Evaluation Minimum Facilities Revenue shall be increased by the Facilities Special Tax Escalation Factor of the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates and Effective Tax Rate Evaluation Minimum Facilities Revenue in effect for the previous Fiscal Year. (3) As a result of future Assessor’s Parcel changes, described in Section C.3, the assigned Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates may exceed the Developed Property Effective Tax Rate Evaluation Maximum Facilities Special Tax Rates set forth in this table.
(4) The total Effective Tax Rate Evaluation Minimum Facilities Revenue may be decreased as result of a portion of Effective Tax Rate Evaluation Maximum Facilities Special Tax obligations being prepaid pursuant to Section L. (5) Based upon the Developed Property Maximum Facilities Special Tax Rate for Single-Family Detached Property in Lot/Village 8A, 8B, 8C, 9A and 9B.

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ATTACHMENT E

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 24 (ALDER CREEK WEST) IMPROVEMENT AREA 3

MAP OF VILLAGES

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Folsom City Council
Staff Report

1 MEETING DATE:

5/28/2026
AGENDA SECTION:

Old Business
SUBJECT: Resolution No. 11622 - A Resolution Authorizing the City Manager to Execute Amendment No. 1 to the Agreement Between the City of Folsom and the Folsom Tourism Bureau Relative to the Folsom Tourism Business Improvement District and Appointing Two Councilmembers to Serve on the FTBID Capital
Improvement Committee

FROM: City Manager's Office

RECOMMENDATION / CITY COUNCIL ACTION

Staff Recommends the City Council adopt Resolution No. 11622 - A Resolution Authorizing the City Manager to Execute Amendment No. 1 to the Agreement between the City of Folsom and the Folsom Tourism Bureau Relative to the Folsom Tourism Business Improvement District and Appointing Two Councilmembers to Serve on the FTBID Governance Committee.

BACKGROUND / ISSUE

TOURISM BUSINESS IMPROVEMENT DISTRICTS

Tourism Business Improvement Districts (TBIDs) util ize the efficiencies of private sector operation in the market-based promotion of tourism. These special assessment districts allow assessed business owners to organize their efforts to increase tourism. Business owners within the TBID fund the TBID, and those funds are used to pro vide services and facilities that are desired by and benefit the assessed businesses within the TBID.

Benefit assessment districts have been used success fully in Folsom as well as other destination areas throughout the state to improve tourism and d rive additional room nights to assessed businesses.

TBID benefits:
 Funds cannot be diverted for other government programs;

06/09/2026 Item No.14.
2  They are customized to fit the needs of each destination;  They allow for a wide range of services and improve ments, including, but not limited to, destination marketing, tourism promotion, and sales lead generation;  They are designed, created, and governed by those w ho will pay the assessment with oversight by the city; and
 They provide a stable funding source for tourism promotion.

FOLSOM TOURISM BUSINESS IMPROVEMENT DISTRICT (FTBID)

The City of Folsom established the FTBID in 2012 vi a the adoption of Resolution No. 9071, pursuant to the Parking and Business Improvement Ar ea Law of 1989 (California Streets and Highway Code § 36500 et seq.) (89 Law) and Ordinanc e No. 1171 (which codified Folsom Municipal Code Chapter 3.100). The FTBID is a benefit assessment district that provides specific benefit directly to the Folsom lodging businesses that are assessed that is not provided to those not paying the assessment. The boundaries of the FTBID are the boundaries of the City of Folsom.

The FTBID includes all lodging businesses with twenty or more rooms, existing and in the future, within the boundaries of the City of Folsom.

Resolution No. 9071 established the FTBID with an assessment rate of 4% to be levied for a term of 20 years, commencing on January 1, 2013 and ending on December 13, 2032. Assessments are levied on lodging businesses with twenty or more rooms, on the basis of benefit.

2026 MODIFICATION

The FTBID Owners’ Association recommended to the lo dging business owners to pursue modification of the FTBID in order to expand a revenue source devoted to marketing Folsom as a tourist, meeting, and event destination and support facility-related investments such as infrastructure improvements.

The proposed modified assessment rate was eight per cent (8%) of gross room rental revenue, increasing the previous rate of four percent (4%) of gross room rental revenue. The additional four percent (4%) assessment was designed to be dedicated to improvements, including but not limited to development of facilities that attract overnight visitation to businesses paying the TBID assessment, infrastructure improvements, and market ing and development efforts directly related to the facilities and associated visitor growth.

Based on feedback received from the lodging busines ses subject to the increased assessment, the Owners Association must establish the FTBID Capital Improvement Committee (Committee) and adopt a Governance Policy (Attachment 3). The Committee shall be comprised of representatives from assessed hotels, TEDCorp, and the City of Fols om that shall direct use of the additional revenue from the supplemental four percent (4%) assessment.

An amendment to the agreement between the City and the Owners’ Association is necessary to incorporate these requirements and ensure they are in place before the modified assessment is levied. This understanding was memorialized in Res olution No. 11539 adopting the modified assessment.

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3 POLICY / RULE

City of Folsom Ordinance No. 1171, codified as Folsom Municipal Code Chapter 3.100, establishes procedures for forming, modifying, and governing parking and business improvement districts supplemental to the 89 Law.

Folsom Municipal Code section 2.36.080 contains the requirements for execution of contracts.

The existing agreement between the City and the Owners’ Association requires that amendments be made in writing, executed by both parties.

ANALYSIS

The FTBID modification was approved by City Council in Resolution No. 11539 on April 28, 2026, subject to the requirements that:

1. The FTBID Owners’ Association shall establish the F TBID Capital Improvement Committee, a committee of representatives from assessed hotels, TEDCorp, and the City that directs use of the additional revenue fro m the supplemental four percent (4%) assessment in conformity with the terms of the Governance Policy.

2. The existing agreement between the City and the Own ers’ Association shall be amended to incorporate requirements that the Owners ’ Association establish the Committee and conform operations of the FTBID to th e Governance Policy with respect to the increased assessment.

3. The increased assessment shall not be levied until the Committee has been established and the contract amendment described above has become effective.

The attached resolution authorizes the City Manager to execute an amendment to the existing agreement with the Owners Association to implement requirements 1-3 above.

With the attached resolution, the Council also appoints two Councilmembers to the Committee as City representatives. Councilmembers Leary and Aquino specifically expressed interest in serving on the Committee, so staff is proposing their appoi ntment, subject to the will of the Council.

Pursuant to the terms of the TBID Governance Policy , the City Manager is also a member of the Committee.

The attached resolution also clarifies that future appointments to the Committee do not need to be made by resolution and may instead follow the Counc il’s standard practice for appointments to boards and commissions.

FINANCIAL IMPACT

The contract amendment and Committee appointments described in this report will have no direct financial impact upon the City. The anticipated financial impact of the TBID modification

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4 is described in the staff report associated with Resolution No. 11539, adopted at the April 28, 2026 Council Meeting.

ENVIRONMENTAL REVIEW

This action is not subject to the California Environmental Quality Act (CEQA) because it is not considered a project pursuant to CEQA Guidelines sections 15378(b)(4) and (5). See also CEQA Guidelines section 15002(d).

ATTACHMENTS

1. Resolution No. 11622 - A Resolution Authorizing the City Manager to Execute Amendment No. 1 to the Agreement Between the City of Folsom and the Folsom Tourism Bureau Relative to the Folsom Tourism Business Impr ovement District and Appointing Two Councilmembers to Serve on the FTBID Capital Improvement Committee

2. Agreement Between the City of Folsom and the Folsom Tourism Bureau Relative to the Folsom Tourism Business Improvement District

3. FTBID Capital Improvement Committee Governance Policy

Submitted,
Bryan Whitemyer
City Manager

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Attachment 1

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Resolution No. 11622

RESOLUTION NO. 11622

A RESOLUTION AUTHORIZING THE CITY MANAGER TO EXECUTE
AMENDMENT NO. 1 TO THE AGREEMENT BETWEEN THE CITY OF

FOLSOM AND THE FOLSOM TOURISM BUREAU RELATIVE TO THE

FOLSOM TOURISM BUSINESS IMPROVEMENT DISTRICT AND

APPOINTING TWO COUNCILMEMBERS TO SERVE ON THE FTBID

CAPITAL IMPROVEMENT COMMITTEE

WHEREAS, the Parking and Business Improvement Area Law of 1 989, Streets and Highways Code §36500 et seq., (1989 Law) authorizes cities and counties to establish parking and business improvement districts for the purpose of promoting tourism; and

WHEREAS, the City of Folsom (“the City”) adopted Ordinance No. 1171, codified as Folsom Municipal Code Chapter 3.100, which establis hes procedures for forming parking and business improvement districts supplemental to the 1989 Law; and

WHEREAS, the City Council established the Folsom Tourism Bu siness Improvement District (“FTBID”) on October 23, 2012, by Resolution No. 9071; and

WHEREAS, Folsom Municipal Code § 3.100.090 authorizes the F TBID Owners’ Association at any time to recommend the City modify the FTBID; and

WHEREAS, the FTBID Owners’ Association facilitated a request to modify the FTBID; and

WHEREAS, the City complied with the notice and majority prot est proceeding requirements contained in state law as modified by the Folsom Municipal Code with respect to the proposed TBID modification; and

WHEREAS, a majority protest is defined as written protests r eceived from owners of businesses in the modified FTBID which would pay fifty percent (50%) or more of the assessments proposed to be levied. Protests are weighted based on the assessment proposed to be levied on each assessed business; and
WHEREAS, the City Clerk determined that a conditional majori ty protest existed, to the effect that owners of businesses in the modified FT BID which would pay fifty percent (50%) or more of the assessments proposed to be levied submitted written protests stating that they support the proposed modification contingent upon the gover nance of the FTBID conforming to a governance policy prepared by the assessed business owners and agreed to by the Owners’ Association (“Governance Policy”) which includes a requirement for the Owners’ Association to establish the FTBID Capital Improvement Committee, a committee of representatives from assessed hotels, TEDCorp, and the City to direct us e of the additional revenue from the supplemental four percent (4%) assessment consisten t with the terms of the Governance Policy (“the Committee”); and

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Resolution No. 11622

WHEREAS , to effectuate the will of business owners in the modified FTBID which would pay fifty percent (50%) or more of the assessments proposed to be levied as stated in the conditional majority protest, the agreement between the City and the Owners’ Association must be amended to incorporate requirements that the Own ers’ Association establish the Committee and conform operations of the FTBID to the Governan ce Policy with respect to the increased assessment; and

WHEREAS, on April 28, 2026, the Council declared the results of the majority protest proceedings and adopted Resolution No. 11539, modif ying the assessment rate of the Folsom Tourism Business Improvement District from a rate o f four percent (4%) to eight percent (8%), contingent upon governance of the FTBID conforming to the Governance Policy with respect to the increased assessment; and

WHEREAS, Resolution No. 11539 included a requirement that th e FTBID Owners’ Association establish the Committee; and

WHEREAS, Resolution No. 11539 included a requirement that th e existing agreement between the City and the Owners’ Association be ame nded to incorporate requirements that the Owners’ Association establish the Committee and con form operations of the FTBID to the Governance Policy with respect to the increased assessment; and

WHEREAS, Resolution No. 11539 included a requirement that th e increased assessment not be levied until the Committee has been established and the associated contract amendment has become effective; and

WHEREAS, pursuant to Folsom Municipal Code §3.100.110, business owners subject to the assessment may request disestablishment; and
WHEREAS, the agreement will be in a form acceptable to the City Attorney:

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Folsom authorizes the City Manager to Execute Amendment No . 1 to the Agreement between the City of Folsom and the Folsom Tourism Bureau relative to th e Folsom Tourism Business Improvement District; and

BE IT FURTHER RESOLVED that the City Council appoints the following Councilmembers as City Council representatives to t he FTBID Capital Improvement Committee for the initial term:

1. Councilmember Aquino

2. Councilmember Leary

BE IT FURTHER RESOLVED that the City Council may appoint City Council representatives to the FTBID Capital Improvement Co mmittee for subsequent terms through the

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Resolution No. 11622

Council’s typical process for updating appointment of City Council representatives to regional boards and commissions without a formal resolution approving the appointment(s).

PASSED AND ADOPTED this 26
th day of May 2026, by the following roll-call vote:

AYES: Councilmember(s):

NOES: Councilmember(s):

ABSENT: Councilmember(s):

ABSTAIN: Councilmember(s):

_________________________________
Justin Raithel, MAYOR

ATTEST:

____________________________________
Christa Freemantle, CITY CLERK

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Attachment 2

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ATTACHMENT 2

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Attachment 3

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Approved by TEDCorp Board 4.8.2026
Attachment 3
Folsom TBID Capital Im provement C ommittee
Governance Policy

1. Purpose
The Folsom TBID Capital Improvement Committee (the “Committee”) is established as a formal committee of TEDCorp/Folsom Tourism Bureau. The Committee shall operate within TEDCorp’s governance structure and function in accordance with all applicable laws, including those governing Tourism Business Improvement Districts (TBIDs).

The Committee is established to direct and oversee the use of funds generated by the additional 4% TBID assessment dedicated for capital improvements. The Committee ensures these funds support projects that:
• Increase overnight hotel stays in Folsom
• Enhance tourism-related infrastructure and amenities
• Improve visitor experiences
• Strengthen Folsom’s competitiveness as a regional destination

2. Committee Name
FTBID Capital Improvement Committee

3. Authority & Relationship to Existing Organizations
The Committee shall have the authority to review, prioritize, and approve the use of funds generated by the additional 4% TBID assessment. No funds generated by the additional 4% TBID assessment shall be expended without prior approval of the Committee.

The TEDCorp Board retains ultimate fiduciary responsibility, contracting authority, legal and financial oversight and shall ensure compliance with all governing laws and agreements. The committee shall be subject to the same audit, accounting, reporting, and legal requirements as TEDCorp. The expenses associated with these requirements shall come from the additional 4% TBID assessment. The committee shall not have authority to approve, authorize or commit TEDCorp to any indebtedness, borrowing, guarantee, or financial obligation without approval of the Board of Directors.

4. Control of Funds
All funds generated by the additional 4% TBID assessment shall be treated as restricted funds. These funds shall not be commingled or used outside the Committee’s authority.

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Approved by TEDCorp Board 4.8.2026
The Committee shall have sole authority to approve allocation of these funds, subject only to the authority of the TEDCorp Board to accept or reject the allocation.

5. Responsibility of the Committee
Each year the Committee will:

1. Review tourism trends and hotel performance

2. Establish annual spending priorities

3. Identify high-impact tourism investments

4. Consider projects for funding approval

6. Project Eligibility & Evaluation Criteria
Funds shall be used exclusively for projects and initiatives reasonably expected to generate overnight hotel stays and increase visitation.

Eligible uses include:
• Tourism-related infrastructure, including sports tourism • Event attraction
• Destination-driving events, programming and marketing • Capital improvements supporting overnight visitation
• Strategic demand-generating investments

Projects must demonstrate a clear nexus to overnight stays, visitor demand, or economic impact.

In evaluating projects, the Committee shall prioritize projects and programs that:
• increase measurable room night generation
• increase midweek and shoulder season demand
• have long-term economic impact
• leverage funding or include public private partnerships • strategically align with TEDCorp’s Tourism Strategy

7. Committee Composition & Voting Structure
To ensure balanced representation, the Committee will consist of eleven (11) members nominated as described below. Each member shall have one (1) vote. Proxy voting is not permitted.

Hotel Industry Representatives (6 seats)
• Six representatives from hotels paying into the FTBID Appointments shall be by participating hoteliers.

TEDCorp Representatives (2 seats)
• Two members of the TEDCorp Board of Directors
Appointments shall be by TEDCorp Board of Directors and shall not be a City representative.

City Representatives (3 seats)
• Two members of the Folsom City Council
• City Manager

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Approved by TEDCorp Board 4.8.2026
City Council appointments shall be by the City Council.

8. Member Terms
Terms shall be five (5) years and may be staggered initially for continuity with the exception of City Council Representatives, which will be appointed each year by the City Council.

Members may serve up to two consecutive terms.

Hotel representatives must remain active operators of a hotel subject to the FTBID assessment.

9. Leadership
The Committee shall elect a Chair and Vice Chair from the hotel industry representatives The Chair, in coordination with the TEDCorp CEO, shall set agendas, facilitate meetings, and serve as liaison to the TEDCorp Board.

The Vice Chair shall perform these duties in the absence of the Chair.

10. Meetings & Compliance
The Committee shall meet as needed and maintain records of all actions. Meetings shall comply with applicable laws and governance requirements including the Brown Act.

TEDCorp shall form the Committee by Board resolution, pursuant to the California Corporations Code and the TEDCorp Bylaws. The resolution should establish the Committee's authority, composition, and purpose as required by Cal. Corp. Code § 7212(a)(6).

The Committee's initial meeting shall be scheduled and agendized in compliance with Brown Act notice requirements (Cal. Gov. Code § 54954.2). The agenda for the initial meeting should include:

• Dissemination of Brown Act requirements to all Committee members • Election of Committee officers
• Adoption of policies for the conduct of Committee business • Establishment of a regular Committee meeting schedule

11. Accountability & Reporting
Pursuant to TEDCorp Bylaw’s, staff shall provide an annual report on fund use and project outcomes, including impacts on hotel occupancy and visitation each year.

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Folsom City Council
Staff Report

1 MEETING DATE:

5/26/2026
AGENDA SECTION:

Old Business
ITEM TITLE: Consideration of Potential Ballot Measure(s) Amending the City Charter and/or the Folsom Municipal Code for the 2026 General Municipal Election and Direction to Staff

FROM: City Manager's Office

RECOMMENDATION / CITY COUNCIL ACTION

Staff requests that the City Council consider and provide direction to staff regarding preparation of potential ballot measures amending the City Charter and/or the Folsom Municipal Code for the 2026 General Municipal Election.

BACKGROUND / ISSUE

On December 9, 2025, the City Council adopted Resolution No. 11525, establishing the 2026 Ad Hoc Charter Review Committee. The Committee was tasked with reviewing the City Charter and recommending appropriate updates and changes to the City Council. Resolution No. 11525 directed the Committee to submit a report to the City Council containing its recommendations.

The Committee performed its work over five meetings, held from March 4, 2026 to May 4, 2026.

During these meetings, the Committee conducted a review of the City Charter and ultimately approved recommended language changes to seven sections of the Charter and one section of the Folsom Municipal Code that was an initiative measure passed by a vote of the people in 1994.

Resolution No. 11525 created the 2026 Ad Hoc Charter Review Committee as a Brown Act Committee, so the Committee’s meetings were open to the public. Members of the public attended the final three meetings and addressed the Committee on many of the items considered.

On May 12, 2026, the 2026 Ad Hoc Charter Review Committee’s Report was submitted to the City Council and a public hearing was held on the eight amendments recommended by the Committee. During the public hearing, 14 members of the public spoke, many of whom

06/09/2026 Item No.15.
2 addressed the proposal to amend Section 2.07(D) – Restriction on City Utility or Enterprise (franchise authority), which would have eliminated the existing voter approval requirement before a City owned utility or enterprise may be sold, leased for more than 2 years, contracted to, or put to franchise to any non-governmental party.

Following the public hearing, the City Council deliberated and passed Resolution No. 11613, receiving the 2026 Ad Hoc Charter Review Committee Report to City Council with recommended amendments and dissolving the Committee.

The Council engaged in further deliberation and ultimately voted 4-0, with one absent, not to submit the following proposed Charter amendments to the voters at the November 3, 2026 election:

1. Section 2.01 - City Council: to address the transition away from at-large elections.

2. Section 2.01(E) - Term limits: reducing the maximum number of consecutive terms City Councilmembers may serve, from four 4-year terms to three 4-year terms.

3. Section 2.06 - City Council Compensation and Expenses: to add automatic annual salary adjustments for City Council, tied to the Consumer Price Index, with a maximum increase of three percent per year.

4. Section 2.07(D) – Restriction on City Utility or Enterprise (franchise authority):
eliminate voter approval requirement before a City owned utility or enterprise may be sold, leased for more than 2 years, contracted to, or put to franchise to any non- governmental party. This will allow the Council to franchise or contract for City services without voter approval.

5. Section 9.02 – Transition of Elected Officials from 1990: delete entirely as obsolete.

The Committee voted 7-0 in favor of this recommendation.

The Council directed staff to return on May 26, 2026, for further consideration of whether to submit to the voters at the November 3, 2026 election any of the following amendments recommended by the Committee:

1. Section 4.03 - City Attorney: to change how the City Attorney is appointed, from the current system in which the City Manager appoints the City Attorney, to a system in which the City Council appoints the City Attorney, and related procedural and structural changes.

2. Section 4.07 – Boards and Commissions: strike language that all City Boards and Commissions are only advisory to the Council, allowing the Council to set the powers and duties of Commissions and Committees by ordinance. Clarifying that Committee members must be residents and registered voters of the City.

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3 3. Folsom Municipal Code § 2.48.030 – Campaign contribution limitation. To increase the campaign contribution limit in support or opposition to any candidate from $150 to a higher limit to be determined.

POLICY / RULE

The recommendations brought forward by the Ad Hoc Charter Review Committee relate to distinct and separate areas of law. To facilitate the City Council’s review and ensure the legally sufficient placement of these items on the ballot, the following sections outline the governing legal framework applicable to each of the proposed measures under consideration.

Charter Amendment
City Charter section 8.01 governs Charter amendments, which may be framed and proposed in several ways, including by an ordinance of the City Council containing the full text of the proposed amendment. Charter Amendments must be approved by a majority of the voters of the City at a regular election.

Pursuant to City Charter section 2.12(A), no City ordinance shall contain more than one subject, which shall be clearly expressed in its title. This “single subject rule” applies to all of the remaining amendments recommended in the Committee’s report.

Amendment of Ordinance Passed as an Initiative Measure
As applicable here, Elections Code section 9217 requires that an ordinance proposed by initiative petition and adopted by the voters shall only be amended by a vote of the people. Elections Code section 9222 allows the City Council to submit to the voters, without a petition, a proposition for the amendment of any ordinance, to be voted upon at any succeeding regular or special election. If the proposition submitted receives a majority of the votes cast on it at the election, the ordinance shall be amended.

Campaign Contribution Limits
Campaign contribution limits have been held to infringe on the contributor’s ability to engage in free communication and association, thereby impinging on First Amendment freedoms. (Citizens United v. Federal Election Commission (2010) 558 US 310.) Limits on campaign contributions made directly to candidates or their committees may be upheld if the regulations are “closely drawn” to achieve important governmental interests, including preventing corruption, the appearance of corruption, and the circumvention of otherwise valid campaign finance regulations. ( Buckley v. Valeo (1976) 424 US 1, 26.) However, the goals of equalizing political opportunities between candidates and reducing the influence of money in politics were rejected by the Supreme Court in Citizens United as sufficiently important governmental interests to support impinging on First Amendment freedoms. As a result, those concepts cannot be used as the basis for campaign contribution limits. (Citizens United, 558 US at p. 350.)

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4 ANALYSIS

Summary of Recommended Amendments
Each proposed amendment is reflected in an attachment to this staff report containing the recommended language amendments approved by the Committee and modified by staff following Council deliberation on May 12, 12026, as well as a succinct explanation of the reasons for the proposed changes. Briefly, the remaining amendments recommended by the Committee and not eliminated by the Council include:

1. Section 4.03 - City Attorney: to change how the City Attorney is appointed, from the current system in which the City Manager appoints the City Attorney, to a system in which the City Council appoints the City Attorney, and related procedural and structural changes.

2. Section 4.07 – Boards and Commissions: strike language that all City Boards and Commissions are only advisory to the Council, allowing the Council to set the powers and duties of Commissions and Committees by ordinance. Clarify that Committee members must be residents and registered voters of the City.

3. Folsom Municipal Code § 2.48.030 – Campaign contribution limitation. To increase the campaign contribution limit in support or opposition to any candidate from $150 to a higher limit to be determined through City Council deliberation.

Next Steps
Following the May 26, 2026 City Council meeting on this item, staff requests that the Council provide direction on which proposal(s) it would like to submit to the voters at the November 3, 2026 election.

If the Council elects to proceed with proposed amendment(s), a second public hearing will be held on June 23, 2026, where the City Council will consider ordinance(s) containing the specific language of the City Charter and/or Folsom Municipal Code amendment(s) it would like to be submitted to the voters.

On July 14, 2026, the Council will consider a resolution formally approving submission to the voters of any proposed amendments to the City Charter and/or the Folsom Municipal Code.

At the Council’s direction, the proposed amendments could be submitted to the voters at the statewide general election on November 3, 2026. Each proposed amendment shall be approved if it receives a majority of the votes cast on it at the election.

FINANCIAL IMPACT

The Sacramento County Department of Voter Registration and Elections recently updated its election fee formula, resulting in a substantial increase over prior estimates. The 2024 election that included Measure G and two city council positions cost the City $61,145. However, based

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5 on new information from the County Registrar of Voters Office, the revised cost structure is as follows:

• First Ballot Measure: Approximately $83,000

• Subsequent Measures: Approximately $10,750 per ad ditional item

If the City Council decides to add three measures to the ballot the anticipated City election costs for 2026 are estimated to be approximately $115,250. Staff has included sufficient funds to cover this cost in the proposed FY 2026/2027 preliminary budget.

ENVIRONMENTAL REVIEW

The proposed Charter and Folsom Municipal Code amendments are not a project for purposes of CEQA because CEQA only applies to activities that may cause either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment.

Because the proposed amendments do not have the potential to cause a physical change in the environment directly or indirectly, they are not a project subject to CEQA. (Public Resources Code §§ 21065; 21080(a); CEQA Guidelines §§ 15060(c), (2), (3); 15378(b)(2).) If for any reason the proposed amendments are considered a project, they are exempt from CEQA review pursuant to CEQA Guidelines § 15061(b)(3) because it can be seen with certainty that there is no possibility the activity in question may have a significant effect on the environment.

ATTACHMENTS

1. Proposed Amendment to City Charter § 4.03 City Attorney

2. Proposed Amendment to City Charter § 4.07 Boards and Commissions

3. Proposed Amendment to Folsom Municipal Code § 2.48.030 Campaign contribution limitation

Submitted,

Bryan Whitemyer
City Manager

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Attachment 1

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Attachment 1
Section / Title:

Section 4.03 (City Attorney)
What Change is Recommended and Why:

Designate the City Council as responsible for the direct hiring and oversight of the City Attorney position and make related procedural and structural changes to align with existing Charter language for the City Manager position, which is also hired by and reports directly to the Council.

The Committee reviewed the current appointment process for the City Attorney, with a focus on shifting this responsibility toward a Council-led hiring model. It was noted that the prevailing standard in other municipalities is for the City Attorney to report directly to and be hired by the City Council. Based on this, the Committee proposed a formal shift in authority to ensure the Council is responsible for the direct hiring and oversight of the City Attorney position.

Committee Vote:

The Committee voted 7-0 in favor of this recommendation.

Current Language:

4.03 City Attorney:

The office of City Attorney is hereby created. The City Attorney shall be the chief legal officer of the City, and:

A. Duties. Shall advise the City Council, individual Councilmembers, the City Manager and his/her assistants, and department heads regarding the law relating to City affairs.

B. Additional Duties. Shall represent the City in all legal proceedings, prepare all ordinances and other needed legal documents, select and retain specialist counsel where there is a need for such specialized legal services, and perform such other duties as may be prescribed by ordinance.

C. Department Head. May be a full time department head of the City, or may be contracted as a department head.

D. Approval of Contracts. Shall review and approve all City contracts as to legal form.

E. Special Counsel. The City Council may retain special counsel in any matter where representation by the City Attorney would create an impermissible conflict, including the discipline or dismissal of the City Manager.

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Proposed Language:

4.03 City Attorney:

The office of City Attorney is hereby created. The City Attorney shall be the chief legal officer of the City, and, notwithstanding any other provision of this Charter:

A. Duties. Shall advise the City Council, individual Councilmembers, the City Manager and his/her assistants, and department heads regarding the law relating to City affairs.

B. Additional Duties. Shall represent the City in all legal proceedings, prepare all ordinances and other needed legal documents, select and retain specialist counsel where there is a need for such specialized legal services, and perform such other duties as may be prescribed by ordinance.

C. Department Head. May be a full time department head of the City appointed by the City Council, or may be contracted by the City Council as a department head.

D. Approval of Contracts. Shall review and approve all City contracts as to legal form.

E. Special Counsel. The City Council may retain special counsel in any matter where representation by the City Attorney would create an impermissible conflict, including the discipline or dismissal of the City Manager.

F. City Attorney Appointment. The City Council shall appoint a City Attorney for an indefinite term through the mechanism of an employment agreement the same as those afforded department heads under this Charter. The City Attorney:

1. Serve At Pleasure. Shall serve at the pleasure of the Council;

2. How Chosen. Shall be chosen solely on the basis of administrative qualifications and, at time of appointment need not be a resident of the State or City but shall be a member of the California State Bar;

3. Salary. Shall be paid a salary fixed by the Council commensurate with the responsibilities of the position;
G. Dismissal Hearing. Shall have the right to a public hearing on any motion to remove or to suspend his/her employment, which public hearing shall be held only after provision of 10 days' published notice prior to the Council voting on the motion to remove or to suspend the City Attorney.

H. Restriction on Dismissal. During a period of 90 days immediately following the date of installation of any person newly elected to the Council at a regular or special City election, or of any person newly appointed to the Council, the Council shall take no action, whether immediate or prospective, to remove, suspend, request the resignation of, or to reduce the duties, salary or benefits of the City Attorney.

I. Appointment of Employees. The City Attorney shall appoint all other members of the City Attorney’s Office to positions authorized by the Council. These employees shall serve at the pleasure of the City Attorney but shall have permanent status subject to all rights and limitations in the City merit system.

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Redline Showing Changes:

4.03 City Attorney:

The office of City Attorney is hereby created. The City Attorney shall be the chief legal officer of the City, and
, notwithstanding any other provision of this Charter :

A. Duties. Shall advise the City Council, individual Councilmembers, the City Manager and his/her assistants, and department heads regarding the law relating to City affairs.

B. Additional Duties. Shall represent the City in all legal proceedings, prepare all ordinances and other needed legal documents, select and retain specialist counsel where there is a need for such specialized legal services, and perform such other duties as may be prescribed by ordinance.

C. Department Head. May be a full time department head of the City appointed by the City Council , or may be contracted by the City Council as a department head.

D. Approval of Contracts. Shall review and approve all City contracts as to legal form.

E. Special Counsel. The City Council may retain special counsel in any matter where representation by the City Attorney would create an impermissible conflict, including the discipline or dismissal of the City Manager.

F. City Attorney Appointment. The City Council shall appoint a City Attorney for an indefinite term through the mechanism of an employment agreement the same as those afforded department heads under this Charter. The City Attorney:

1. Serve At Pleasure. Shall serve at the pleasure of the Council;

2. How Chosen. Shall be chosen solely on the basis of administrative qualifications and, at time of appointment need not be a resident of the State or City but shall be a member of the California State Bar;

3. Salary. Shall be paid a salary fixed by the Council commensurate with the responsibilities of the position;
G. Dismissal Hearing. Shall have the right to a public hearing on any motion to remove or to suspend his/her employment, which public hearing shall be held only after provision of 10 days' published notice prior to the Council voting on the motion to remove or to suspend the City Attorney.

H. Restriction on Dismissal. During a period of 90 days immediately following the date of installation of any person newly elected to the Council at a regular or special City election, or of any person newly appointed to the Council, the Council shall take no action, whether immediate or prospective, to remove, suspend, request the resignation of, or to reduce the duties, salary or benefits of the City Attorney.

I. Appointment of Employees. The City Attorney shall appoint all other members of the City Attorney’s Office to positions authorized by the Council. These employees shall serve at the pleasure of the City Attorney but shall have permanent status subject to all rights and limitations in the City merit system.