Agenda packet — Fontana City Council, May 14, 2024 (part 10 of 11)

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March 19, 2024, Planning Commission Hearing
Minutes
Planning Commission Minutes March 19 , 2024
Attachment No. 3

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PH-D Master Case No. 22-143: Tentative Parcel Map (TPM 20710) No. 23-012, Design Review (DRP) No. 22-064, Development Agreement (AGR) No. 24-002, and Final Subsequent Environmental Impact Report for the development of an industrial warehouse building totaling approximately 881,826 square feet on approximately

40.01 acres.

Chair Fort opened Public Hearing.

Rina Leung, Senior Planner, presented the staff report.

The applicant Myra Ramirez, on behalf of Prologis, stated that she read and agreed to the Conditions of Approval.

The applicant and traffic engineer spoke about mitigation measures and average daily truck trips.

The City Clerk’s Department received four (4) written correspondences for this item.

The following individuals spoke in opposition:
 Zach Strasters
 Salvador Rincon
 David Martinez
 Andrew Graf
 Elijah Silva
 Godfrey Wachira
 Robert Lujan
 Elizabeth Sena
 Joaquin Castillejos
The following individuals spoke in favor:
 Jon Shardlow
 Amanda Morales
 Al Sanchez
 Rafael Legido
 Alex Zamora
 Forrest Peck
The Public Hearing was closed.
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Planning Commission Minutes March 19 , 2024
Attachment No. 5

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Additionally, the commission and staff discussed traffic study and traffic mitigation. The Environmental Consultant also commented on the truck trips generated by the project.

Lastly, the commission and staff discussed state requirements and the responsibilities of the developers when addressing solar.

RECOMMENDATION:

1. Based on the information contained in this staff report and subject to the attached Findings and Conditions of Approval, staff recommends that the Planning Commission adopt Resolution No. PC 2024-020, and,
a. Certify the FSEIR, a Mitigation Monitoring and Reporting Program and a Statement of Facts and Findings, and direct staff to file a Notice of Determination.

2. Based on the information contained in this staff report and subject to the attached Findings and Conditions of Approval, staff recommends that the Planning Commission adopt Resolution No. PC 2024-021, and,
a. Approve Tentative Parcel Map No. 23-012 (TPM No. 20710); and, b. b. Approve Design Review No. 22-064; and,

3. Adopt Resolution No. PC 2024-022 and forward a recommendation to the City Council to adopt an ordinance approving Development Agreement (AGR) No. 24- 002.

ACTION: Motion was made by Commissioner Sangha and seconded by Secretary Quintana and passed by a vote of 4-0 to approve Public Hearing Item “D” and adopt Resolution PC No. 2024-020, 21, & 22; approve Tentative Parcel Map No. 23-012 (TPM No. 20710); Design Review No. 22-064.

The motion carried by the following vote:

AYES: Chair Fort, Secretary Quintana, Commissioners Sangha, and Thrasher; NOES: None; ABSTAIN: None. ABSENT: Vice Chair Sanchez.
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Attachment No. 4
ORDINANCE NO.

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF

FONTANA APPROVING, PURSUANT TO THE CERTIFIED

FINAL SUPPLEMENTAL ENVIRONMENTAL IMPACT
REPORT (SCH 2009091089) FOR THE PROJECT,
APPROVING DEVELOPMENT AGREEMENT (AGR) NO.
24-002 BETWEEN THE CITY OF FONTANA AND
PROLOGIS EXCHANGE 11115 HEMLOCK AVENUE LLC,

WHICH PROVIDES FOR EXTENDED ENTITLEMENT

TIMING AND ENHANCED ENVIRONMENTAL MEASURES

FOR AN APPROVED INDUSTRIAL COMMERCE CENTER
DEVELOPMENT OF APPROXIMATELY 881,826 SQUARE
FEET ON APPROXIMATELY 40.01 ACRES
WHEREAS, the City Council (“City Council”) of the City of Fontana ("City") is authorized by California Government Code sections 65864 et seq. and section 30-322 of the City's Development Code (“Development Code”) to enter into an agreement for the development of real property with any person having a legal or equitable interest in such property in order to establish certain development rights in such property; and WHEREAS, the City of Fontana (“the City”) has found that development agreements will strengthen the public planning process, encourage private participation in comprehensive planning by providing a greater degree of certainty in that process, reduce the economic costs of development, allow for the orderly planning of public improvements and services, allocate costs to achieve maximum utilization of public and private resources in the development process, and ensure that appropriate measures to enhance and protect the environment are achieved; and
WHEREAS, because of the logistics, magnitude of the expenditure, and considerable lead time required to plan and develop the Property, Prologis Exchange 11115 Hemlock Avenue (“Developer”) has proposed to enter into a development agreement concerning the Property located at 11115 Hemlock Avenue (Assessor Parcel Numbers 0237-131-25,-26 and -27) (the “Property”), to provide assurances that the Property can be developed without disruption caused by a change in the City’s planning policies and requirements except as provided in the development agreement, which assurances will thereby reduce the actual or perceived risk of planning for and proceeding with development of the Property; and
WHEREAS, the City and Developer are supportive of entering into Development Agreement No. 24-002 ("AGR No. 24-002”) for the Property which the Developer has fee title; and

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WHEREAS, Developer’s interest in the Property, including that interest to be conveyed pursuant to the AGR No. 24-002, constitutes a legal or equitable interest in real property pursuant to California Government Code section 65865; and WHEREAS, Developer proposes the development of the Property for an industrial building totaling approximately 881,826 square feet to achieve the goals of the City's General Plan (“General Plan”), as further described and conditioned in the AGR No. 24- 002 such development shall be referred to herein as the “Project”); and WHEREAS, City has found that the AGR No. 24-002 attached hereto as “Exhibit A” and incorporated herein by reference is consistent with City's General Plan and it has been reviewed and evaluated in accordance with Section 30-102 of the City Development Code; and
WHEREAS, City has determined that by entering into the AGR No. 24-002: (i) City will promote orderly growth and quality development on the Property in accordance with the goals and policies set forth in the General Plan and (ii) City will benefit from increased employment, industrial opportunities created by the Project for residents of the City; and WHEREAS, a Final Subsequent Environmental Impact Report (FSEIR) to the previously-certified Final Program Environmental Impact Report (FEIR) for the Southwest Industrial Park (SWIP) Specific Plan Update and Annexation (State Clearinghouse (SCH) No. 2009091089) has been prepared for this project in accordance with Sections 15063 and 15163 of the California Environmental Quality Act (CEQA) and identified the AGR No. 24-002 as a potential Project approval; and
WHEREAS, on March 19, 2024, pursuant to the California Environmental Quality Act (Pub. Res. Code §§ 21000 et seq.) (“CEQA”), and the State CEQA Guidelines (14 Cal. Code Regs. §§ 15000 et seq.) the Planning Commission certified the project FSEIR (SCH #2009091089), and approved the Mitigation Monitoring and Reporting Program (MMRP) with Resolution PC Number 2024 – 020; and,
WHEREAS, on May 14, 2024, the City Council at a public hearing considered and denied Appeal (APL) No. 24-002 and Appeal (APL) No. 24-005 to uphold the Planning Commission’s March 19, 2024 decision approving Tentative Parcel Map No. 23-012 (TPM No. 20710) and Design Review (DRP) No. 22-064 along with the certification of a Final Subsequent Environmental Report (FSEIR) State Clearinghouse Number (SCH No. 2009091089) and adoption of a Mitigation, Monitoring, and Reporting Program, (MMRP), and
WHEREAS, the terms and conditions of the AGR No. 24-002 have undergone review by City at publicly noticed hearings and have been found to be fair, just and reasonable, and consistent with the General Plan. Further, City found that:
(i) the economic interests of the City's citizens and the public health, safety and welfare will be best served by entering into the Development Agreement;

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(ii) the development agreement is compatible with the uses authorized in, and the regulations prescribed for, the land use district in which the Property is located; (iii) the development agreement is consistent with the General Plan; (iv) the development agreement is in conformity with the public convenience, general welfare and good land use practice;
(v) the development agreement will not be detrimental to the public health, safety and general welfare; and
(vi) the development agreement will not adversely affect the orderly development or the preservation of property values for the Property or any other property; and WHEREAS, all the notices require by statute and the Fontana Municipal Code have been given as required.

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

SECTION 1. Recitals. The City Council hereby incorporates by reference the Recitals set forth herein and adopts those Recitals as its own as though fully set forth in this Ordinance. Pursuant to California Government Code section 65867.5(b), and based on the entire record before the City Council, including all written and oral evidence presented to the City Council, the City Council hereby finds that the development agreement is consistent with the General Plan because the AGR No. 24-002 will result in the development of the Property at the intensity and density allowed under the General Plan and with the restrictions and standards set forth in the City's Municipal Code.

SECTION 2. California Environmental Quality Act. Consistent with CEQA and the State CEQA Guidelines (Cal. Code Regs., tit. 14, § 15000 et seq.), EIR (State Clearinghouse No. 2022110389) was prepared for development, including the Tentative Parcel Map and Design Review. The Planning Commission certified the Project SEIR and adopted the MMRP, the City Council, and, based on the CEQA Sections 15162 through 15164, staff has determined that none of the criteria requiring a subsequent environmental document have been met and that further environmental analysis is not required, and directs Staff to file a Notice of Determination. On May 14, 2024, the City Council at a public hearing considered and denied Appeal (APL) No. 24-002 and Appeal (APL) No. 24-005 to uphold the Planning Commission’s March 19, 2024 decision approving Tentative Parcel Map No. 23-012 (TPM No. 20710) and Design Review (DRP) No. 22-064 along with the certification of a Final Subsequent Environmental Report (FSEIR) State Clearinghouse Number (SCH No. 2009091089) and adoption of a Mitigation, Monitoring, and Reporting Program, (MMRP).

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SECTION 3. Development Agreement Findings. Based upon the entire record and all written and oral evidence presented, the City Council finds this Ordinance promotes the public health, safety and welfare of the community because the AGR No. 24-002 will enable needed public improvements at the Property and the economic development of the Property will benefit the citizens of the City.

The City Council further finds that among the public benefits to accrue to the residents of the City as a result of AGR No. 24-002 are:

1. The revitalization of an underdeveloped site.

2. The development of onsite infrastructure upgrades that would not occur otherwise.

3. The generation of additional property tax.

4. The stimulation of adjacent areas in the City by introducing new industrial facility and opportunities.

5. The implementation of numerous City planning and economic development policies which benefit the health and fiscal welfare of the City and its residents.

6. The implementation of enhanced environmental measures.

SECTION 4. Development Agreement Approval. Pursuant to California Government Code sections 65865 et seq., the City Council hereby approves the AGR No. 24-002 between Developer and the City, a copy of which is on file with the City Clerk and attached hereto as “Exhibit A”.

SECTION 5. Recordation. The City Clerk shall cause to be recorded with the San Bernardino County Recorder a copy of the executed development agreement at the time and in the manner provided for in the development agreement.

SECTION 6. Effective Date/Publication. This Ordinance shall take effect thirty (30) days after the date of the adoption, and prior to the expiration of the fifteen (15) days from the passage thereof, shall be published by the City Clerk at least once in the Fontana Herald News, a local newspaper of general circulation, published and circulated in the City of Fontana, and henceforth and thereafter the same shall be in full force and effect.

SECTION 7. Custodian of Records. The documents and materials that constitute the record of proceedings on which this Ordinance is based are located at the City Clerk’s office located at 8353 Sierra Avenue, Fontana, CA 92335. The custodian of records is the City Clerk.

SECTION 9. Severability. If any provision of this Ordinance or the application of any such provision to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of this Ordinance that can be given effect without the invalid provision or application.

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APPROVED and ADOPTED this 28th day of May 2024.

READ AND APPROVED AS TO LEGAL FORM:

City Attorney
I, Germaine McClellen Key, City Clerk of the City of Fontana, and Ex-Officio Clerk of the City Council, do hereby certify that the foregoing Ordinance is the actual Ordinance adopted by the City Council and was introduced at a regular meeting on the 14th day of May 2024, and was finally passed and adopted not less than five days thereafter on the 28th day of May 2024 by the following vote to wit:

AYES:

NOES:

ABSENT:

City Clerk of the City of Fontana
Mayor of the City of Fontana
ATTEST:

City Clerk

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EXHIBIT "A"

DEVELOPMENT AGREEMENT

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Attachment No. 5

NOTICE OF DETERMINATION
TO: X County Clerk, County of FROM: City of Fontana
San Bernardino Planning Department
8353 Sierra Avenue
___ X Office of Planning and Research Fontana, CA 92335 SUBJECT: Filing of Notice of Determination in Compliance with Section 21152 of the Public Resources Code.

Project Title: Master Case No. 22-143: Development Agreement (AGR) No. 24-002 – Hemlock Warehouse Development Agreement for extending timing parameters and enhanced environmental measures.

State Clearinghouse Number: 2009091089
Name of Person or Agency carrying out project: Rina Leung, City of Fontana (Lead Agency) 8353 Sierra Avenue, Fontana, CA 92335.

Project Location: The project site is located at 11115 Hemlock Avenue (APNs: 0237-131-25, 0237-131-26, and 0237-131-27)
Project Description: Development Agreement for a term of 10 years that commences upon expiration of the initial two (2) year period for MCN22-143, Tentative Parcel Map No. 23-012 (TPM No. 20710), and Design Review No. 22-064 along with enhanced environmental measures by exceeding the minimum requirements of the Warehouse Actions and Investments to Reduce Emissions (WAIRE) Program Project Proponent & Address: Prologis Exchange 11115 Hemlock Avenue LLC, 17777 Center Court Dr. N, Suite 100, Cerritos, CA 90703
Contact Name & Phone: Rina Leung (909 350-6566)
On March 19, 2024, the City certified a Final Subsequent Environmental Impact Report (FSEIR) to the previouslycertified Final Program Environmental Impact Report (FEIR) for the Southwest Industrial Park (SWIP) Specific Plan Update and Annexation (State Clearinghouse (SCH) No. 2009091089), which included this Development Agreement.

In accordance with Sections 15162 and 15163 of the California Environmental Quality Act Guidelines, no further environmental review is required.

This is to certify that on May 28, 2024, the City Council of the City of Fontana approved the above-described project for Master Case No. 22-143 for Development Agreement (AGR) No. 24-002 and made the following determinations:

1. The project _X_ will will not have a significant effect on the environment where a Subsequent EIR was prepared and previously certified for this project pursuant to the provisions of CEQA.

2. A Subsequent EIR was prepared and previously certified for this project pursuant to the provisions of CEQA and reflects the independent judgment of the Lead Agency.

3. Mitigation measures X were were not identify in the previously certified EIR, were made a condition of the approval of the project (MCN22-143 for Tentative Parcel Map No. 23-012 (TPM No. 20710) and Design Review No. 22-064).

4. A Statement of Overriding Considerations _X_ was was not adopted for this project for the previously certified Subsequent EIR.

5. Findings X were were not made in the previously certified Subsequent EIR pursuant to the provisions of CEQA.

6. The location and custodian of the documents which comprise the record of proceedings for the Subsequent EIR are specified as follows:

Custodian: City of Fontana, Planning Department
Location: 8353 Sierra Avenue, Fontana, CA 92335
____________________________
DiTanyon Johnson, Principal Planner
Date Received for Filing
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Attachment No. 6

NOTICE OF PUBLIC HEARING AND

OF INTENT TO MAKE A CEQA FINDING
Si desea información en Español referente a esta notificación o proyecto, favor de comunicarse al (909) 350-6728.

In compliance with Section No. 202 of the Americans with Disabilities Act of 1990 (42 U.S.C.

Sec. 12132) and the federal rules and regulations adopted in implementation thereof, the agenda will be made available in appropriate alternative formats to persons with a disability.

Should you need special assistance to participate in this meeting, please contact the City Clerk’s Department by calling (909) 350-7602. Notification 48 hours prior to the meeting will enable the city to make reasonable arrangements to ensure accessibility to this meeting.

A PUBLIC HEARING HAS BEEN SCHEDULED BEFORE THE CITY COUNCIL OF THE CITY OF FONTANA FOR THE FOLLOWING:

Master Case (MCN) No. 22-143, Development Agreement (AGR) No. 24-002: An Ordinance of the City Council of the City of Fontana, California, pursuant to a certified Subsequent Environmental Impact Report, approving a Development Agreement with Prologis Exchange 11115 Hemlock Avenue LLC, concerning an Industrial Commerce Center development of an approximately 881,826 square feet on approximately 40.01 acres, and direct staff to File a Notice of Determination.

General Project
Description:

A Development Agreement that has a term of 10 years that commences upon expiration of the initial two (2) year period along with enhance environmental measures in association with an approved new industrial commerce center.

Environmental
Determination:

On March 19, 2024 the City certified a Final Subsequent Environmental Impact Report (FSEIR) (State Clearinghouse (SCH) No. 2009091089) to the previously-certified Final Program Environmental Impact Report (FEIR) for the Southwest Industrial Park (SWIP) Specific Plan Update and Annexation (State Clearinghouse (SCH) No. 2009091089), which included the Development Agreement, for the Industrial Commerce Center. In accordance with Sections 15162 and 15163 of the California Environmental Quality Act Guidelines, no further environmental review is required.

Date of Hearing: May 14, 2024
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Place of Hearing: City Hall Council Chambers, 8353 Sierra Avenue, Fontana, CA, 92335 Time of Hearing: 2:00 P.M.

Project Location: 11115 Hemlock Avenue (APNs: 0237-131-25, 0237-131-26, and 0237- 131-27)
A draft copy of the proposed Development Agreement is available for public inspection at the office of the Fontana City Clerk, City Hall Council Chambers, 8353 Sierra Avenue, Fontana, CA, 92335.

Should you have any questions concerning this project, please contact Rina Leung at (909) 350-6566 or rleungfontanaca.gov.

ANY INTERESTED PARTY MAY PROVIDE INFORMATION BY LETTER OR EMAIL WHICH MAY BE OF ASSISTANCE TO THE CITY COUNCIL. A COPY OF THE ENVIRONMENTAL DOCUMENTATION IS AVAILABLE FOR INSPECTION. PLEASE CONTACT THE PLANNER LISTED ABOVE.

IF YOU CHALLENGE IN COURT ANY ACTION TAKEN CONCERNING A PUBLIC HEARING ITEM,

YOU MAY BE LIMITED TO RAISING ONLY THOSE ISSUES YOU OR SOMEONE ELSE RAISED AT

THE PUBLIC HEARING DESCRIBED IN THIS NOTICE, OR IN WRITTEN CORRESPONDENCE TO THE CITY AT, OR PRIOR TO, THE PUBLIC HEARING.

Publish: May 3, 2024
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City of Fontana
Action Report
City Council Meeting
8353 Sierra Avenue
Fontana, CA 92335
File #: 21-2924 Agenda Date: 5/14/2024
Agenda #: E. Category: Public Hearing
FROM:

Planning Department
SUBJECT:

Master Case No. 24-019 and Municipal Code Amendment No. 24-001: Fontana Municipal Code amendments to Chapter 30 (Zoning and Development Code), pursuant to a categorical exemption in accordance with CEQA Guidelines section 15060(c) and 15061(B)(3).

RECOMMENDATION:

1. Determine that this project is Categorically Exempt pursuant Sections 15060(c), 15061(B)(3) (the “common-sense” exemption), and 15378 and Sections No. 3.01, 3.22, and 10.59 of the 2019 Local Guidelines for Implementing CEQA, and direct staff to file a Notice of Exemption; and,

2. Read by title only and waive further reading of and introduce Ordinance No. 1951, an Ordinance of the City Council of the City of Fontana approving Master Case No. 24-019 and Municipal Code Amendment No. 24-001 to amend multiple sections of Chapter 30 of the Fontana Zoning and Development Code, including amendments to sections 30-41, 30-43, 30-80, 30-215, 30-217, 30-302.2, and 30-643 to remove references to the Development Advisory Board; Sections 30-285 and 30-294 to correct noticing verbiage related to Tentative Maps; Sections 30-362 through 30-370 and 30-378 through 30-380 to remove Form Based Code maximum lot dimensions and add language to allow common and public open space for projects over two acres in the Form Base Code; Section 30-404 to provide common open space amenity options; Section 30-467 to remove ADU owner occupancy requirements consistent with state law; and Section 30-530 to remove certain “all other” use categories permitted in industrial zoning districts; and the reading of the title constitutes the first thereof.

COUNCIL GOALS:
· Promote economic development by pursuing business attraction, retention, and expansion. · Promote economic development by establishing a quick, consistent development process. · Promote economic development by being business friendly at all levels and striving to constantly improve the city's competitiveness.

DISCUSSION:

Background:

The Planning Commission reviewed Master Case No. 24-019 and Municipal Code Amendment No. 24-001 during its March 19, 2024, meeting. At the conclusion of the hearing, the Planning Commission adopted Resolution PC No. 2024-023 to recommend approval of Municipal Code Amendment No. 24-001 to the City Council.

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File #: 21-2924 Agenda Date: 5/14/2024
Agenda #: E. Category: Public Hearing
Analysis:

The City is proposing approval of Municipal Code Amendment No. 24-001 to update Chapter 30, that will modify multiple sections of the Zoning and Development Code, including removal of references to the development advisory board (various portions of the code), corrections to Tentative Parcel Map and Tentative Tract Map noticing section referencing minor use permits, removing maximum lot dimensions in the Form Based Code, add language to allow common and public open space for projects over two acres in the Form Based Code, removal of owner occupancy requirements related to accessory dwelling units and removal of certain permitted uses in industrial zoning districts. The amendments are proposed in order to provide flexibility, clarity, and streamlining of the City’s Municipal Code.

The following is a brief summary of the proposed amendments. A detailed list of proposed amendments are provided under the Ordinance, attached to this staff report as Attachment No. 1.

Development Advisory Board: Multiple sections will be amended to remove references to the Development Advisory Board, which no longer exists.

Tentative Map Cleanup Item: Corrections to clean up incorrect language referencing minor use permits in the Tentative Parcel Map and Tentative Tract Map noticing section of the code.

Maximum Lot Dimensions and Common and Public Open Space: This amendment will modify the development standards tables of various subdistrict of the Form Based Code to remove the maximum lot dimensions. In addition, this amendment will add language to allow common and public open space for projects over two acres within the Form Based Code. This will remove obstacles to residential development and provide consistency with the requirements of residential zoning districts.

Section 30-404: General requirements: This amendment will provide additional amenities that can be considered in Form Based Code open spaces.

Section 30-467: Accessory dwelling units and junior accessory dwelling units: This amendment will remove the language that references owner occupancy for ADU’s, consistent with recently adopted state legislation, with the exception of junior accessory dwelling units (JADU’s) which is permitted by state law.

Section 30-530: Uses permitted: This amendment will modify the language within the permitted uses table to remove “catch-all” categories withing the table.

In summary, the proposed amendments are proposed in order to provide flexibility in, and streamlining of, the City’s Municipal Code.

FISCAL IMPACT:

None.

MOTION:

Approve staff recommendation.

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ORDINANCE NO. _____

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF

FONTANA, CALIFORNIA, APPROVING MUNICIPAL CODE
AMENDMENT NO. 24-001 TO AMEND MULTIPLE
SECTIONS OF CHAPTER 30 (FONTANA ZONING AND

DEVELOPMENT CODE) INCLUDING AMENDMENTS TO
SECTIONS 30-41, 30-43, 30-80, 30-215, 30-217, 30-302.2, AND 30-643 TO REMOVE REFERENCES TO THE
DEVELOPMENT ADVISORY BOARD; SECTIONS 30-285
AND 30-294 TO CORRECT NOTICING VERBIAGE
RELATED TO TENTATIVE MAPS; SECTIONS 30-362
THROUGH 30-370 AND 30-378 THROUGH 30-380 TO

REMOVE FORM BASED CODE MAXIMUM LOT

DIMENSIONS AND ADD LANGUAGE TO ALLOW COMMON

AND PUBLIC OPEN SPACE FOR PROJECTS OVER TWO
ACRES IN THE FORM BASED CODE; 30-404 TO PROVIDE
COMMON OPEN SPACE AMENITY OPTIONS; 30-467 TO

REMOVE ADU OWNER OCCUPANCY REQUIRMENTS
CONSISTENT WITH STATE LAW; AND 30-530 TO REMOVE
CERTAIN “ALL OTHER” USES PERMITTED USES IN

INDUSTRIAL ZONING DISTRICTS, PURSUANT TO A

CATEGORICAL EXEMPTION IN ACCORDANCE WITH
CEQA GUIDELINES SECTIONS 15060(C) AND 16051(B)(3).

WHEREAS, pursuant to article XI, section 5 of the California Constitution and Government Code section 37100, the legislative body of a city may pass ordinances not in conflict with the Constitution and laws of the State or the United States; and WHEREAS, Government Code sections 50022.1 to 50022.10 authorizes a city to codify and recodify its ordinances; and
WHEREAS, the City of Fontana (“City”) desires to restate without substantive revision, amend and recodify certain ordinances codified in the Fontana Municipal Code (“Code”); and
WHEREAS, the General Plan includes policies and actions calling for numerous updates to the Code; and
WHEREAS, Section 30-41. – “Pre-application meeting.” is amended to remove references to the Development Advisory Board (DAB); and WHEREAS, Section 30-43. – “Development Advisory Board (DAB) review.” Reserved, is being deleted; and
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Ordinance CC No. 2024-_____

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WHEREAS, Section 30-80. – “Development Advisory Board (DAB) review.” Reserved, is being deleted; and
WHEREAS, Section 30-215. – “Pre-application meeting.” is amended to remove references to the Development Advisory Board (DAB); and WHEREAS, Section 30-217. – “Development Advisory Board (DAB) review.” Reserved, is being deleted; and
WHEREAS, Section 30.285 – “Noticing.” is amended to remove erroneous verbiage “minor use permits” from this section; and
WHEREAS, Section 30-294 – “Noticing.” is amended to remove erroneous verbiage “minor use permits” from this section; and
WHEREAS, Section 30-302.2 – “Finance and conveyance maps.” will be amended to remove references to the Development Advisory Board; and WHEREAS, Section 30-362 – “Station area district.” is amended to remove maximum lot width and depth dimensions and add language regarding common and public open space for projects over two acres; and
WHEREAS, Section 30-363 – “Downtown gateway district.” is amended to remove maximum lot width and depth dimensions and add language regarding common and public open space; and
WHEREAS, Section 30-364 – “Neighborhood district.” is amended to remove maximum lot width and depth dimensions and add language regarding common and public open space; and
WHEREAS, Section 30-365 – “Multi-family district.” is amended to remove maximum lot width and depth dimensions and add language regarding common and public open space; and
WHEREAS, Section 30-366 – “Transitional district.” is amended to remove maximum lot width and depth dimensions and add language regarding common and public open space; and
WHEREAS, Section 30-367 – “Sierra gateway district.” is amended to remove maximum lot width and depth dimensions and add language regarding common and public open space; and
WHEREAS, Section 30-368 – “Route 66 gateway district.” is amended to remove maximum lot width and depth dimensions and add language regarding common and public open space; and
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Ordinance CC No. 2024-_____

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WHEREAS, Section 30-369 – “Valley gateway district.” is amended to remove maximum lot width and depth dimensions and add language regarding common and public open space; and
WHEREAS, Section 30-370 – “Village gateway district.” is amended to remove maximum lot width and depth dimensions and add language regarding common and public open space; and
WHEREAS, Section 30-378 – “Hybrid.” is amended to remove maximum lot width and depth dimensions; and
WHEREAS, Section 30-379 – “Flex building.” is amended to remove maximum lot width and depth dimensions; and
WHEREAS, Section 30-380 – “Liner building.” is amended to remove maximum lot width and depth dimensions; and
WHEREAS, Section 30-404 – “General requirements.” is amended to identify common open space amenities; and
WHEREAS, Sec. 30-467 – “Accessory dwelling units and junior accessory dwelling units.” is amended to remove references to Owner Occupancy in compliance with Government Code section 66315; and
WHEREAS, Section 30-530 – “Uses permitted.” Is amended to remove certain broad categories of permitted uses within industrial zoning districts; and WHEREAS, Section 30-643 – “Minimum development standards.” is amended to remove references to the DAB; and
WHEREAS, State law requires Zoning regulations to be consistent with the General Plan and therefore updating the Municipal Code would contribute to consistency with the General Plan; and
WHEREAS, a notice of the public hearing was published in the local newspaper on Saturday, May 3, 2024 and simultaneously displayed at City Hall; and WHEREAS, on March 19, 2024, the Fontana Planning Commission (“Planning Commission”) held a public meeting on amendments to sections 30-41, 30-43, 30-80, 30- 215, 30-217, 30-302.2, 30-643, 30-285, 30-294, 30-362 through 30-370, 30-378 through 30-380, 30-404, 30-467 and 30-30 (together “MCA No. 24-001”) where they received evidence and public testimony on the amendments and recommended that the Fontana City Council (“City Council”) determine that the amendments qualify for a categorical exemption pursuant to the California Environmental Quality Act (CEQA) Guidelines Sections 15060(c), 15061(B)(3) (the common-sense exemption), and Sections No. 3.01,

3.22, and 10.59 of the 2019 Local Guidelines for Implementing CEQA. This Ordinance is 1655
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nonetheless exempt from the requirements of CEQA in that the activity is covered by the general rule that CEQA applies only to projects which have the potential for causing a significant effect on the environment. Where it can be with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA; and
WHEREAS, the Planning Commission carefully considered all evidence and testimony presented at its public hearing on March 19, 2024 and recommended that the City Council approve the modifications to the Zoning and Development Code; and WHEREAS, the amendments in MCA No. 24-001 are consistent and compatible with the General Plan and are in line with goals, policies and objectives of the City; the Housing Element policies and the Zoning and Development Code; and WHEREAS, the amendments in MCA No. 24-001 will be in conformity with appropriate land use practices and will establish appropriate development standards for the land use designations; and
WHEREAS, the amendments in MCA No. 24-001 are attached here to as Exhibit “A” and incorporated herein by reference, will not be detrimental to the public health, safety and general welfare, nor will it adversely affect the orderly development of property; and
WHEREAS, the amendments in MCA No. 24-001 will better express the City’s policies and will generally promote good land use planning and regulation; and WHEREAS, On May 3, 2024, the Fontana Planning Department published the item in the local newspaper; and
WHEREAS, on May 14, 2024, the City Council held a public meeting on MCA No. 24-001 where City Council received evidence and public testimony pertaining to the Zoning and Development Code amendments; and
WHEREAS, the City Council carefully considered all information pertaining to MCA No. 24-001 that was presented at its public hearing on May 14, 2024; and WHEREAS, all other legal prerequisites to the adoption of this Ordinance have occurred.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF FONTANA, CALIFORNIA, DOES ORDAIN AS FOLLOWS:
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SECTION 1. Recitals. The recitals are true, correct and incorporated herein by this reference.

SECTION 2. CEQA. The City Council hereby determines that this project qualifies for a categorical exemption pursuant to the California Environmental Quality Act (CEQA) Guidelines Sections 15060(c), 15061(B)(3) (the common-sense exemption), and 15378 and Sections No. 3.01, 3.22, and 10.59 of the 2019 Local Guidelines for Implementing CEQA, as implementation of this Ordinance is to improve the environment.

SECTION 3. Development Code Amendment Findings. The City Council hereby makes the following findings for Municipal Code Amendment No. 24-001 accordance with Section 30-40 “Purpose” of the Fontana Zoning and Development Code:

Finding: A Zoning and Development Code may be amended by changing the development standards (text) or zoning designation map boundaries of any zone whenever such an amendment is
deemed necessary to protect or promote the public's health, safety or general welfare or when modification is viewed as appropriate in the context of generally accepted planning principles, surrounding land uses, and the General Plan.

Findings of Fact: The City initiated the Code amendment to amend Chapter 30 to modify multiple sections, including amendments to sections 30-41, 30-43, 30-80, 30-215, 30-217, 30-302.2, and 30-643 to remove references to the DAB; Sections 30-285 and 30-294 to correct erroneous references to minor use permits; Sections 30-362 through 30-380 to remove Form Based Code maximum lot dimensions and add language to allow common and public open space for projects over two acres; 30-404 to provide common open space amenity options; 30-467 to remove ADU owner occupancy requirements consistent with state law; and 30-530 to remove certain permitted uses in Industrial Zoning Districts. These amendments would provide clarity, eliminate inconsistencies, streamline City processes, and improve the implementation of the Code which is beneficial to the community to promote public welfare and furthers good planning principals. The amendments will provide flexibility to various development standards which will allow for various housing developments and promote the public’s health and safety or general welfare.

SECTION 4. Development Code Amendment Approval. Based on the foregoing, the City Council hereby approves the amendments as set forth in MCA No. 24-001, which is attached hereto as Exhibit “A” and incorporated herein by reference as fully set forth herein.
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SECTION 5. Effective Date/Publication. This Ordinance shall take effect thirty (30) days after the date of the adoption and prior to the expiration of fifteen (15) days from the passage thereof, shall be published by the City Clerk at least once in the Fontana Herald News, a local newspaper of the general circulation, published and circulated in the City of Fontana, and henceforth and thereafter the same shall be in full force and effect.

SECTION 6. Custodian of Records. The documents and materials that constitute the record of proceedings on which this Ordinance is based are located at the City Clerk’s office located at 8353 Sierra Avenue, Fontana, CA 92335. The custodian or records is the City Clerk.

SECTION 7. Certification. The City Clerk of the City Council shall certify to the adoption of this Ordinance.

SECTION 8. Severability. If any provision of this Ordinance or the application of any such provision to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of this Ordinance that can be given effect without the invalid provision or application.

APPROVED AND ADOPTED this 14th day of May 2024.

READ AND APPROVED AS TO LEGAL FORM:
_________________________________________
City Attorney
I, Germaine Key, City Clerk of the City of Fontana, and Ex-Officio Clerk of the City Council, do hereby certify that the foregoing Ordinance is the actual Ordinance adopted by the City Council and was introduced at a regular meeting on the 14th day of May 2024, and was finally passed and adopted not less than five days thereafter on the 28th day of May 2024, by the following vote to wit:

AYES:

NOES:

ABSENT:
_________________________________________
City Clerk of the City of Fontana
_________________________________________
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Mayor of the City of Fontana
ATTEST:
_________________________________________
City Clerk
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“EXHIBIT A”
Below are the Amendments to Chapter 30 of the Municipal Code. Deletions are shown as strike outs. Additions are shown as underlines.

Sec. 30-41. - Pre-application meeting.

Prior to the filing of an application for a Development Code and/or zoning district map amendment, the applicant or the applicant's representative shall apply for a preapplication meeting application. The pre-application meeting is presented to the Development Advisory Board Director of Planning for recommendation for the project.

The recommendation should be incorporated into the project prior to filing the formal application.

Sec. 30-43. - Development Advisory Board (DAB) review. Reserved.

All application for Development Code and/or zoning district map amendments shall be reviewed by the Development Advisory Board (DAB) to provide recommendation for the project. The recommendation should be incorporated into the project prior to moving forward to the approval body.

Sec. 30-80. - Development Advisory Board (DAB) review. Reserved.

All application for administrative site plan, major shall be reviewed by the Development Advisory Board (DAB) to provide recommendation for the project. The recommendation should be incorporated into the project prior to moving forward to the approval body.

Sec. 30-215. - Pre-application meeting.

Prior to the filing of an application for a variance, major, the applicant or the applicant's representative shall hold a pre-application meeting with the Director of Community Development and the Development Advisory Board apply for a preapplication conference with Director of Planning. Projects determined minor in nature may be waived of this process by the Director of Planning.

Sec. 30-217. - Development Advisory Board (DAB) review. Reserved.

All application for variance, major shall be reviewed by the Development Advisory Board (DAB) to provide recommendation for the project. The recommendation should be incorporated into the project prior to moving forward to the approval body.

Sec. 30-285. - Noticing.

Notice of hearings for minor use permit tentative parcel map modification shall be as set forth in Division 4, of this article herein.
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Sec. 30-294. - Noticing.

Notice of hearings for minor use permit tentative tract map modification shall be as set forth in Division 4, of this article herein.

Sec. 30-302.2. - Finance and conveyance maps.
(a) Purpose. The purpose and intent is to provide procedures for the implementation of Government Codes relative to Finance and Conveyance Maps. Specific procedures as outlined in Division 21 of this article and Chapter 26; the administrative procedures are herein.
(b) Authority. The Director of Planning is authorized to approve or deny finance and conveyance map applications.
(c) Application. An application for a finance and conveyance map shall be filed with the Planning Department in a manner prescribed by the Director of Planning. (d) Reserved. Development Advisory Board (DAB) review. All application for a finance and conveyance map shall be reviewed by the Development Advisory Board (DAB) to provide recommendation for the project. The recommendation should be incorporated into the project prior to moving forward to the approval body. (e) Findings for approval. The Director of Planning shall make the findings identified in Chapter 26 before granting approval of a finance and conveyance map application. (f) Noticing. Notice of hearings for finance and conveyance maps shall be as set forth in Division 4, of this article herein.
(g) Hearing. Upon receipt of a complete application for the project a time and place for the hearing before the Director of Planning shall be set. (h) Appeal. The decision of the Director of Planning shall be final unless an appeal is filed. An appeal could be made to the Planning Commission as set forth in Division 5, of this article herein.
(i) Time limitations. Each finance and conveyance map approval granted under this article shall become null and void pursuant to the time limitation identified in Chapter

26. Sec. 30-362. Station area district.

The station area district includes the Metrolink station and Omnitrans bus terminal as the primary anchors. This area provides a transition between the retail district, the south Sierra gateway district and Chaffey College.

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Front Side/Rear
Min. (ft.) Max. (ft) Min. (ft.)
i. Front Street 0 10 -
ii. Side Street 0 10 -
iii. Side (Interior) - - 0
iv. Rear yard - - 5
railadjacent - - 10
Allowed
Building Types
Min Max
Stories/ft. Lot W/D Stories/ft. Lot W/D
Court 1/18 100/100 4/55 150/150
Flex 2/30 25/100 4/55 400/150
Hybrid 2/30 150/160 4/55 400/150
Liner 2/30 100/100 4/55 200/150
Live/Work 2/24 75/80 3/40 150/150
Frontage Coverage 50% minimum
Story Height
Ground Floor Upper Stories
Min. Height 12 ft. Minimum Height 10 ft.

Common Open
Space/Amenities
Development projects over two acres shall develop 5 percent of the site as common open space or public open space.*
*See Article III (Form Based Code), Division 10 of the Zoning and Development Code.

Sec. 30-363. Downtown gateway district.

The downtown gateway district is primarily intended for commercial retail and personal service uses. New development should incorporate pedestrian elements to help serve as a transition to surrounding land uses.

Residential or
Mixed-Use Density
Minimum Maximum
15 units/acre 39 units/acre
Commercial
Floor Area Ratio
(without a residential component)
— 2.0
Setback Building setback from PL
Front Side/Rear
Min.
(ft.)
Max.
(ft)
Min. (ft.)
i. Front Street 5 35 -
ii. Side Street 5 20 -
iii. Side (Interior) - - 0
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iv. Rear yard - - 15
Allowed
Building Types
Min Max
Stories/ft. Lot W/D Stories/ft. Lot W/D
Flex 2/30 25/100 5/70 400/150
Hybrid 3/40 150/160 5/70 400/150
Liner 1/24 100/100 5/70 200/150
Live/Work 1/24 75/80 3/40 150/150
Court 2/24 100/100 5/70 150/150
Frontage Coverage 50% minimum
Story Height
Ground Floor Upper Stories
Min. Height 12 ft. Minimum Height 10 ft.

Sec. 30-364. Neighborhood district.

The neighborhood district is an area primarily developed with single-family detached homes. New development should preserve and exemplify the character of existing neighborhoods.

Single-Family Density Minimum Maximum
3 units/acre 5 units/acre
Setback Building setback from PL
Front Side/Rear
Min.
(ft.)
Max.
(ft)
Min. (ft.)
i. Front Street 10 25 -
ii. Side Street 10 20 -
iii. Side (Interior) - - 5
iv. Rear yard - - 10
Allowed
Building Types
Min Max
Stories/ft. Lot W/D Stories/ft. Lot W/D
Single Family 1/15 50/75 3/40 75/100
Flex
(non-residential
only)
1/24 — 3/40 —
Common Open
Space/Amenities
Development projects over two acres shall develop 5 percent of the site as common open space or public open space.*
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*See Article III (Form Based Code), Division 10 of the Zoning and Development Code.

Sec. 30-365. Multi-family district.

The multi-family district provides higher densities focused along the fringe of the more urban development. New development should incorporate increased density with architectural design and materials that exemplify one of the designated architectural styles.

Multi-Family Density Minimum Maximum
12 units/acre 39 units/acre
Setback Building setback from PL
Front Side/Rear
Min.
(ft.)
Max.
(ft)
Min. (ft.)
i. Front Street 5 20 -
ii. Side Street 5 10 -
iii. Side (Interior) - - 0
iv. Rear yard - - 10
Allowed
Building Types
Min Max
Stories/ft. Lot W/D Stories/ft. Lot W/D
Court 1/18 100/100 4/55 200/200
Liner 1/24 100/100 4/55 200/200
Rowhouse 2/24 125/125 3/40 125/150
Rosewalk &
Bungalow Court
1/18 100/100 2/40 200/200
Duplex,
Multiplex
1/18 50/100 3/40 75/150
Flex 1/24 — 3/40 —
Frontage Coverage 50% minimum
Story Height
Ground Floor Upper Stories
Min. Height 12 ft. Minimum Height 10 ft.

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Sec. 30-366. Transitional district.

The transitional district is adjacent to more intense commercial uses providing a transition to more sensitive uses, such as residential. This district includes a mixture of commercial office, retail, personal services, and residential.

Multi-Family or Mixed-Use Density Minimum Maximum
12 units/acre 39 units/acre
Detached Single-Family Density 3 units/acre 12 units/acre Commercial Floor Area Ratio — 2.0
Setback Building setback from PL
Front Side/Rear
Min.
(ft.)
Max.
(ft)
Min. (ft.)
i. Front Street 10 30 -
ii. Side Street 10 15 -
iii. Side (Interior) - - 5
iv. Rear yard - - 20
Allowed
Building Types
Min Max
Stories/ft. Lot W/D Stories/ft. Lot W/D
Court 2/30 100/100 3/40 150/150
Live/Work 1/18 75/80 3/40 150/150
Rowhouse 1/18 125/125 3/40 125/150
Rosewalk &
Bungalow Court
1/18 75/100 3/40 150/150
Duplex,
Multiplex
1/18 50/100 3/40 75/100
Single Family 1/18 50/100 3/40 —
Frontage Coverage 50% minimum
Story Height
Ground Floor Upper Stories
Min. Height 12 ft. Minimum Height 10 ft.

Sec. 30-367. Sierra gateway district.

The Sierra gateway district is intended to encourage pedestrian-oriented development and land uses. Uses are to include a mix of medium- to high-density residential, retail and services, office, entertainment, education, and open space. 1665
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Residential or Mixed-Use Density Minimum Maximum
18 units/acre 39 units/acre
Commercial Floor Area Ratio (without
residential component)
— 2
Setback Building setback from PL
Front Side/Rear
Min.
(ft.)
Max.
(ft)
Min. (ft.)
i. Front Street 0 10 -
ii. Side Street 0 10 -
iii. Side (Interior) - - 0
iv. Rear yard - - 5
Allowed
Building Types
Min Max
Stories/ft. Lot W/D Stories/ft. Lot W/D
Flex 1/30 25/100 4/60 400/150
Hybrid 3/40 150/160 5/70 400/150
Liner 1/24 100/100 5/70 200/150
Live/Work 1/24 75/80 3/40 150/150
Rowhouse 2/24 75/80 3/40 150/150
Frontage Coverage 50% minimum
When the development project
is 5 acres or more in size and
does not include any residential
uses, frontage coverage can be
reduced to 25% at the discretion
of the Planning Commission if it
can be determined that the
reduced frontage benefits public
safety.

Story Height
Ground Floor Upper Stories
Min. Height 12 ft. Minimum Height 10 ft.

Sec. 30-368. Route 66 gateway district.

The Route 66 gateway district is primarily intended for commercial retail and personal service uses with incorporated automobile uses that have traditionally been located along the corridor.
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Residential or Mixed-Use Density Minimum Maximum
18 units/acre 39 units/acre
Commercial Floor Area Ratio (without a
residential component)
— 2.0
Setback Building setback from PL
Front Side/Rear
Min.
(ft.)
Max.
(ft)
Min. (ft.)
i. Front Street 0 10 -
ii. Side Street 0 10 -
iii. Side (Interior) - - 0
iv. Rear yard - - 5
Allowed
Building Types
Min Max
Stories/ft. Lot W/D Stories/ft. Lot W/D
Flex 1/30 25/100 4/60 400/150
Hybrid 3/40 150/160 5/70 400/150
Liner 1/24 100/100 5/70 200/150
Live/Work 1/24 75/80 3/40 150/150
Rowhouse 2/24 75/80 3/40 150/150
Frontage Coverage 50% minimum
Story Height
Ground Floor Upper Stories
Min. Height 12 ft. Minimum Height 10 ft.

Sec. 30-369. Valley gateway district.

The Valley gateway district is intended to encourage pedestrian and transit-oriented development. Land uses should include a mixture of housing types, retail and services, general and medical office, entertainment and education.

Residential or Mixed-Use Density Minimum Maximum
20 units/acre 39 units/acre
Commercial Floor Area Ratio (without
residential component)
— 2.0
Setback Building setback from PL
Front Side/Rear
Min.
(ft.)
Max.
(ft)
Min. (ft.)
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i. Front Street 0 10 -
ii. Side Street 0 10 -
iii. Side (Interior) - - 0
iv. Rear yard - - 5
Allowed
Building Types
Min Max
Stories/ft. Lot W/D Stories/ft. Lot W/D
Flex 2/30 25/100 5/70 400/150
Hybrid 3/40 150/160 5/70 400/150
Liner 1/24 100/100 5/70 200/150
Live/Work 1/24 75/80 3/40 150/150
Frontage Coverage 50% minimum
Story Height
Ground Floor Upper Stories
Min. Height 12 ft. Minimum Height 10 ft.

Sec. 30-370. Village district.

The Village district is intended to provide an alternative to conventional subdivision development with a mixture of housing types, neighborhood-service retail, and open space.

Residential or Mixed-Use Minimum Maximum

2.1 units/acre 24 units/acre
Commercial Floor Area Ratio (without
residential component)
— 1.0
Setback Building setback from PL
Front Side/Rear
Min.
(ft.)
Max.
(ft)
Min. (ft.)
i. Front Street 10 25 -
ii. Side Street 10 20 -
iii. Side (Interior) - - 5
iv. Rear yard - - 10
Allowed
Building Types
Min Max
Stories/ft. Lot W/D Stories/ft. Lot W/D
Flex 2/30 25/100 5/70 400/150
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Hybrid 2/30 150/160 5/70 400/150
Liner 1/24 100/100 5/70 200/150
Live/Work 1/24 75/80 3/40 150/150
Rowhouse 2/24 125/125 3/40 -
Court 2/24 100/100 5/70 150/150
Single Family 1/15 50/75 3/40 75/100
Duplex,
Multiplex
1/18 50/100 3/40 75/150
Rosewalk or
Bungalow Ct.
1/18 75/100 3/40 150/150
Frontage Coverage 50% minimum
Story Height
Ground Floor Upper Stories
Min. Height 12 ft. Minimum Height 10 ft.

Sec. 30-378. - Hybrid.

Description: A building that combines a point-access portion of the building with a walk-up portion. The building may be designed for occupancy by retail, service, and/or office uses on the ground floor, with upper floors also configured for those uses or for residences.

Allowed
In:

Retail, Station, Downtown Gateway, Sierra Gateway, Route 66 Gateway, Valley Gateway & Village
Lot Size: Width: 150 ft. min./200 ft. max.

Depth: 160 ft. min./250 ft. max.

Pedestrian
Access:

The main entrance to each ground floor is directly from the street.

Entrance to the residential portions of the building is through a dedicated street level lobby, or through a dedicated podium lobby accessible from the street or through a side yard.

Interior circulation to each unit above the second level in double-loaded corrido element of the building is through a corridor of at least six feet in width with recessed doors or seating alcoves/offsets at every 100 feet at a minimum. For other units, it is directly off a common courtyard or through stairs serving up to three dwellings. 1669
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Vehicle Access & Parking: Underground garage, surface parking, tuck under parking or a combination of any of the
above.

Frontages: Porch
Dooryard
Stoop
Arcade
Private Open Space: Minimum width: 8 ft.

Minimum depth: 8 ft.

Minimum area: 64 sq. ft.

This open space is exclusive of the
courtyard and may be located in a
side or rear yard.

Common Courtyard: Recommended width/depth/height
ratio: 1:1 approx.

Width/depth: 20 ft. min.

Building Size & Massing: Length along frontage: 200 ft. max.

Sec. 30-379. - Flex building.

Description: A building type designed for occupancy by retail, service, and/or office uses on the ground floor, with upper floors configured for retail, service, office, and/or residential uses. Second floor units may be directly accessed from the street through a stair; upper floors are accessed through a street level lobby.

Allowed In: Retail, Station, Downtown Gateway, Civic, Sierra Gateway, Route 66 Gateway, Valley Gateway & Village
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Lot Size: Width: 400 ft. max.

Depth: 150 ft. max.

Pedestrian
Access:

Direct access from sidewalk. Upper floors accessed from street level.

Vehicle Access
& Parking:

Required parking is accommodated in an underground or aboveground garage, tuck under parking, or a combination of any of the above.

Frontages: Forecourt
Shopfront
Gallery
Arcade
Private Open
Space:

Private open space is required for each residential unit and shall be no less than 64 sq. ft. with a minimum dimension of five feet in each direction.

Shared Open
Space:

The primary shared common space is the rear or side yard designed as a courtyard. Courtyards can be located on the ground or on a podium and must be open to the sky. Side yards can also be formed to provide outdoor patios connected to ground floor commercial uses.

Recommended width/depth/height ratio: 1:1 approx. Width/depth:
20 ft. min.

Building Size &
Massing:

Length along frontage: 400 ft. max., but Iif over 200 ft., must provide massing break.
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Sec. 30-380. - Liner building.

Description: A building that conceals a garage, or other large-scale faceless building (such as a movie theater), "big box" store or surface parking facility, designed for occupancy by retail, service, and/or office uses on the ground floor, with upper floors configured for retail, service, office, and/or residential uses. The access corridor, if applicable, is included in the minimum depth.

Allowed In: Retail, Station, Downtown Gateway, Civic, Sierra Gateway, Route 66 Gateway, Valley Gateway & Village
Lot Size: Width: 400 ft. max.

Depth: 150 ft. max.

Pedestrian
Access:

Direct access from sidewalk. Upper floors accessed from street level.

Vehicle Access
& Parking:

Required parking is accommodated in an underground or aboveground garage, tuck under parking, or a combination of any of the above.

Frontages: Forecourt
Shopfront
Gallery
Arcade
Private Open
Space:

Private open space is required for each residential unit and shall be no less than 64 sq. ft. with a minimum dimension of eight feet in each direction.

Shared Open
Space:

Recommended width/depth/height ratio: 1:1 approx.

Width/depth: 20 ft. min.

Building Size &
Massing:

Length along frontage: 400 ft. max., but Iif over 200 ft., must provide massing break.
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Sec. 30-404. General requirements.
(a) All public open spaces shall abut public right-of-way or be otherwise connected to public sidewalks and shall be open to the public 24 hours per day. At the discretion of the Community Development Director, public access to a public open space may be restricted after dark.
(b) All public open spaces shall be visible from surrounding streets and masses of shrubs around edges shall be avoided.
(c) Common open spaces shall include an amenity such as a tot lot, outdoor sports recreation area, bar-b-que with picnic tables, paseos, or equivalent.

Sec. 30-467. Accessory dwelling units and junior accessory dwelling units. (e) General ADU and JADU requirements. The following requirements apply to all ADUs and JADUs that are approved under subsection (d)(1) or (d)(2) above:
(1) Zoning.
a. An ADU or JADU subject only to a building permit under subsection (d)(1) above may be created on a lot in a residential or mixed-use zone. b. An ADU or JADU subject to an ADU permit under subsection (d)(2) above may be created on a lot that is zoned to allow single-family dwelling residential use or multi-family dwelling residential use.
(2) Height.
a. Except as otherwise provided by subsections (e)(2)(b) and (e)(2)(c) below, a detached ADU created on a lot with an existing or proposed single-family or multi-family dwelling unit may not exceed 16 feet in height. b. A detached ADU may be up to 18 feet in height if it is created on a lot with an existing or proposed single-family or multi-family dwelling unit that is located within one-half mile walking distance of a major transit stop or a high quality transit corridor, as those terms are defined in Public Resources Code § 21155, and the ADU may be up to two additional feet in height (for a maximum of 20 feet) if necessary to accommodate a roof pitch on the ADU that is aligned with the roof pitch of the primary dwelling unit.
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c. A detached ADU created on a lot with an existing or proposed multi-family dwelling that has more than one story above grade may not exceed 18 feet in height.
d. An ADU that is attached to the primary dwelling may not exceed 25 feet in height or the height limitation imposed by the underlying zone that applies to the primary dwelling, whichever is lower. Notwithstanding the foregoing, ADUs subject to this subsection (e)(2)(d) may not exceed two stories. e. For purposes of this subsection (e)(2), height is measured from existing legal grade to the peak of the structure.
(3) Fire sprinklers.

1. Fire sprinklers are required in an ADU if sprinklers are required in the primary residence.

2. The construction of an ADU does not trigger a requirement for fire sprinklers to be installed in the existing primary dwelling.
(4) Rental term. No ADU or JADU may be rented for a term that is shorter than 30 days. This prohibition applies regardless of when the ADU or JADU was created. (5) No separate conveyance. An ADU or JADU may be rented but, except as otherwise provided in Government Code § 65852.26, no ADU or JADU may be sold or otherwise conveyed separately from the lot and the primary dwelling (in the case of a single-family lot) or from the lot and all of the dwellings (in the case of a multi-family lot).
(6) Septic system. If the ADU or JADU will connect to an onsite wastewater-treatment system, include with the application a percolation test completed within the last five years or, if the percolation test has been recertified, within the last ten years. (6) Septic system. If the ADU or JADU will connect to an onsite wastewater-treatment system, include with the application a percolation test completed within the last five years or, if the percolation test has been recertified, within the last ten years. (7) Owner occupancy. As required by state law, all JADUs are subject to an owneroccupancy requirement. A natural person with legal or equitable title to the property must reside on the property, in either the primary dwelling or JADU, as the person's legal domicile and permanent residence. However, the owner-occupancy requirement in this subsection (e)(7)(c) does not apply if the property is entirely owned by another governmental agency, land trust, or housing organization. a. An ADU that is permitted after January 1, 2020, but before January 1, 2025, is not subject to any owner-occupancy requirement.
b. Unless applicable law requires otherwise, all ADUs that are permitted on or after January 1, 2025, are subject to an owner-occupancy requirement.

A natural person with legal or equitable title to the property must reside on the property as the person's legal domicile and permanent residence. c. As required by state law, all JADUs are subject to an owner-occupancy requirement. A natural person with legal or equitable title to the property must reside on the property, in either the primary dwelling or JADU, as the 1674
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person's legal domicile and permanent residence. However, the owneroccupancy requirement in this subsection (e)(7)(c) does not apply if the property is entirely owned by another governmental agency, land trust, or housing organization.
(87) Deed restriction. Prior to issuance of a building permit for an ADU or JADU, a deed restriction must be recorded against the title of the property in the County Recorder's office and a copy filed with the Director. The deed restriction must run with the land and bind all future owners. The form of the deed restriction will be provided by the city and must provide that:
a. Except as otherwise provided in Government Code § 65852.26, the ADU or JADU may not be sold separately from the primary dwelling. b. The ADU or JADU is restricted to the approved size and to other attributes allowed by this section.
c. The deed restriction runs with the land and may be enforced against future property owners.
d. The deed restriction may be removed if the owner eliminates the ADU or JADU, as evidenced by, for example, removal of the kitchen facilities. To remove the deed restriction, an owner may make a written request of the Director, providing evidence that the ADU or JADU has in fact been eliminated. The Director may then determine whether the evidence supports the claim that the ADU or JADU has been eliminated. Appeal may be taken from the Director's determination consistent with other provisions of this Code. If the ADU or JADU is not entirely physically removed but is only eliminated by virtue of having a necessary component of an ADU or JADU removed, the remaining structure and improvements must otherwise comply with applicable provisions of this Code. e. The deed restriction is enforceable by the director or his or her designee for the benefit of the city. Failure of the property owner to comply with the deed restriction may result in legal action against the property owner, and the city is authorized to obtain any remedy available to it at law or equity, including, but not limited to, obtaining an injunction enjoining the use of the ADU or JADU in violation of the recorded restrictions or abatement of the illegal unit. (98) Income reporting. In order to facilitate the city's obligation to identify adequate sites for housing in accordance with Government Code §§ 65583.1 and 65852.2, the following requirements must be satisfied:
a. With the building-permit application, the applicant must provide the city with an estimate of the projected annualized rent that will be charged for the ADU or JADU.
b. Within 90 days after each yearly anniversary of the issuance of the building permit, the owner must report the actual rent charged for the ADU or JADU during the prior year. If the city does not receive the report within the 90-day period, the owner is in violation of this Code, and the city may send the owner a notice of violation and allow the owner another 30 days to submit the report.

If the owner fails to submit the report within the 30-day period, the city may enforce this provision in accordance with applicable law. 1675
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(109) Building and safety.
a. Must comply with building code. Subject to subsection (e)(10)(b) below, all ADUs and JADUs must comply with all local building code requirements. b. No change of occupancy. Construction of an ADU does not constitute a Group R occupancy change under the local building code, as described in California Building Code § 310, unless the building official or Code Compliance Department makes a written finding based on substantial evidence in the record that the construction of the ADU could have a specific, adverse impact on public health and safety. Nothing in this subsection (e)(10)(b) prevents the city from changing the occupancy code of a space that was uninhabitable space or that was only permitted for non-residential use and was subsequently converted for residential use in accordance with this section. (f) Specific ADU requirements. The following requirements apply only to ADUs that require an ADU permit under subsection (d)(2) above.
(1) Maximum size.
a. The maximum size of a detached or attached ADU subject to this subsection (f) is 1,200 square feet.
b. An attached ADU that is created on a lot with an existing primary dwelling is further limited to 50 percent of the floor area of the existing primary dwelling. c. Application of other development standards in this subsection (f), such as lot coverage, might further limit the size of the ADU, but no application of the percent-based size limit in subsection (f)(1)(b) above or of an FAR, front setback, lot coverage limit, or open-space requirement may require the ADU to be less than 800 square feet.

Setbacks.
d. An ADU that is subject to this subsection (f) must conform to an 18-foot frontyard setback, subject to subsection (f)(1)(c) above. e. An ADU that is subject to this subsection (f) must conform to four-foot side- and rear-yard setbacks.
f. No setback is required for an ADU that is subject to this subsection (f) if the ADU is constructed in the same location and to the same dimensions as a legal existing structure.
(2) Lot coverage. No ADU subject to this subsection (f) may cause the total lot coverage of the lot to exceed 50 percent, subject to subsection (f)(1)(c) above. (3) Passageway. No passageway, as defined by subsection (c)(9) above, is required for an ADU.
(4) Parking.
a. Generally. One off-street parking space is required for each ADU. The parking space may be provided in setback areas or as tandem parking, as defined by subsection (c)(12) above.
b. Exceptions. No parking under subsection (f)(4)(a) is required in the following situations:

1. The ADU is located within one-half mile walking distance of public transit, as defined in subsection (c)(11) above.
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2. The ADU is located within an architecturally and historically significant historic district.

3. The ADU is part of the proposed or existing primary residence or an accessory structure under subsection (d)(1)(a) above.

4. When on-street parking permits are required but not offered to the occupant of the ADU.

5. When there is an established car share vehicle stop located within one block of the ADU.

6. When the permit application to create an ADU is submitted with an application to create a new single-family or new multi-family dwelling on the same lot, provided that the ADU or the lot satisfies any other criteria listed in subsections (f)(4)(b)(1) through (5) above.
c. No replacement. When a garage, carport, or covered parking structure is demolished in conjunction with the construction of an ADU or converted to an ADU, those off-street parking spaces are not required to be replaced. (5) Architectural requirements.
a. The materials and colors of the exterior walls, roof, and windows and doors must match the appearance and architectural design of those of the primary dwelling.
b. The roof slope must match that of the dominant roof slope of the primary dwelling. The dominant roof slope is the slope shared by the largest portion of the roof.
c. The exterior lighting must be limited to down-lights or as otherwise required by the building or fire code.
d. The ADU must have an independent exterior entrance, apart from that of the primary dwelling.
e. The interior horizontal dimensions of an ADU must be at least ten feet wide in every direction, with a minimum interior wall height of seven feet. f. Windows and doors of the ADU may not have a direct line of sight to an adjoining residential property. Fencing, landscaping, or privacy glass may be used to provide screening and prevent a direct line of sight. g. All windows and doors in an ADU are less than 30 feet from a property line that is not a public right-of-way line must either be (for windows) clerestory with the bottom of the glass at least six feet above the finished floor, or (for windows and for doors) utilize frosted or obscure glass.
(6) Landscape requirements. Evergreen landscape screening must be planted and maintained between the ADU, and adjacent parcels as follows:
a. At least one 15-gallon size plant shall be provided for every five linear feet of exterior wall. Alternatively, at least one 24 inch box size plant shall be provided for every ten linear feet of exterior wall.
b. Plant specimens must be at least six feet tall when installed. As an alternative, a solid fence of at least six feet in height may be installed. c. All landscaping must be drought tolerant.
(7) Historical protections. An ADU that is on or within 600 feet of real property that is listed in the California Register of Historic Resources must be located so as to not be visible from any public right-of-way.
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(g) Fees. The following requirements apply to all ADUs that are approved under subsections (d)(1) or (d)(2) above.
(1) Impact fees.
a. No impact fee is required for an ADU that is less than 750 square feet in size.

For purposes of this subsection (g)(1), "impact fee" means a "fee" under the Mitigation Fee Act (Government Code § 66000(b)) and a fee under the Quimby Act (Government Code § 66477). "Impact fee" here does not include any connection fee or capacity charge for water or sewer service. b. Any impact fee that is required for an ADU that is 750 square feet or larger in size must be charged proportionately in relation to the square footage of the primary dwelling unit. (E.g., the floor area of the ADU, divided by the floor area of the primary dwelling, times the typical fee amount charged for a new dwelling.)
(2) Utility fees.
a. If an ADU is constructed with a new single-family home, a separate utility connection directly between the ADU and the utility and payment of the normal connection fee and capacity charge for a new dwelling are required. b. Except as described in subsection (g)(2)(a), converted ADUs on a single-family lot that are created under subsection (d)(1)(a) above are not required to have a new or separate utility connection directly between the ADU and the utility.

Nor is a connection fee or capacity charge required.
c. Except as described in subsection (g)(2)(a), all ADUs that are not covered by subsection (g)(2)(b) require a new, separate utility connection directly between the ADU and the utility.

1. The connection is subject to a connection fee or capacity charge that is proportionate to the burden created by the ADU based on either the floor area or the number of drainage-fixture units (DFU) values, as defined by the Uniform Plumbing Code, upon the water or sewer system.

2. The portion of the fee or charge that is charged by the city may not exceed the reasonable cost of providing this service.
(h) Nonconforming zoning code conditions, building code violations, and unpermitted structures.
(1) Generally. The city will not deny an ADU or JADU application due to a nonconforming zoning condition, building code violation, or unpermitted structure on the lot that does not present a threat to the public health and safety and that is not affected by the construction of the ADU or JADU.
(2) Unpermitted ADUs constructed before 2018.
a. Permit to legalize. As required by state law, the city may not deny a permit to legalize an existing, but unpermitted ADU that was constructed before January 1, 2018, if denial is based on either of the following grounds:

1. The ADU violates applicable building standards, or

2. The ADU does not comply with the state ADU law (Government Code § 65852.2) or this ADU ordinance (Section 30-467).
b. Exceptions.
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1. Notwithstanding subsection (h)(2)(a) above, the city may deny a permit to legalize an existing, but unpermitted ADU that was constructed before January 1, 2018, if the city makes a finding that correcting a violation is necessary to protect the health and safety of the public or of occupants of the structure.

2. Subsection (h)(2)(a) above does not apply to a building that is deemed to be substandard in accordance with California Health and Safety Code § 17920.3.

Sec. 30-530. Uses permitted.
(a) Uses by zoning district. Table No. 30-530, lists the uses permitted in each of the industrial zoning districts. A "P" indicates the use is permitted by right and requires site and architectural approval; "M" indicates the use requires the granting of a minor use permit; a "C" indicates the use requires a conditional use permit; and "—" means the use is not permitted in that zoning district. (b) Uses subject to specific requirements. Permitted uses marked with an asterisk "*" are permitted subject to specific use regulations in Section 30-532. Conditional uses are subject to the provisions of Section 30-533. Uses marked with a double Table No. 30-530
Permitted Uses in Industrial Zoning Districts
Uses M-1 M-2

1. Manufacturing
Batching Plant (Concrete Processing)/Mining
and Processing
— C
Manufacturing processes involving raw
materials
— C
Manufacturing processes involving no raw
materials
C P

2. Food processing
Animal slaughtering — —
Commercial Bakery P P
Industrial food catering P P
Lard, pickles, sauerkraut, vinegar — C
Meat, dog and cat food processing, canning,
packaging
— C
All other food processing C C

3. Service and Repair
Body shop and Custom automotive repair
(includes lowering and lifting)
C C
Automobile, truck, and other vehicle wash
facility
P P
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Rental—Automobile, pick-up truck,
commercial truck or van, tractor and/or trailer
C P
Automobile Repair Facility C C
Truck repair facility C C
Cargo container repair ——
Gymnasiums, health spas P P
Tractor (diesel truck), heavy equipment
service and repair
— C
Industrial laundry P P
Machine shop, machinery repair C P
Printer, blueprint shop P P
Recycling facilities C C
Terminal, bus C C

4. Storage and open yards
Auto storage ——
Automobile/truck dismantling —
Truck and trailer storage ——
Truck Terminal C C
Building materials—Finished P* P*
Building materials—Raw (excluding concrete
batching)
— P*
Contractor's equipment storage yard — P*
Hazardous substance (in amounts below the
maximum allowable quantities as determined
by the hazardous material inventory list)
P P
Hazardous substance (in amounts exceeding
the maximum allowable quantities as
determined by the hazardous material
inventory list)
__
Self-storage facility C C
Petroleum and similar flammable materials
(for local distribution)
— C
RV storage P* P*

5. Warehousing Uses
Warehousing, High-Cube P* P
Warehousing, standard P* P
Warehousing, Logistics and Distribution P* P
Warehousing Sales, Retail P * P
Warehousing Sales, Wholesale P * P

6. Retail Sales
Automobile and Boat Sales and Accessory
Uses
C P
Tractor (diesel truck) sales and accessory C M
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Convenience Store P P
Convenience Store with Alcoholic Beverage
Sales
C C
Copying, Packaging, Mailing P P
Fueling Station (with or without convenience
store)
C C
Liquor Store C C
Pharmacy P P
All other retail sales P P

7. Restaurants and bars
Bar C C
Restaurant with or without alcoholic
beverage sales
P P
Restaurant with alcoholic beverage sales C C
Restaurant, drive-thru P P
Restaurant, fast food P P
Micro-brewery C C

8. Administrative and professional offices
Associated with manufacturing or other
industrial use
P* P*
Business Park P P
Financial Institutions P P
Clinic, medical or dental P P
Laboratory, medical or biological P P
Optician P P
All other offices P P

9. Educational
Driver training school C C
Trade or technical school C C
All other educational institutions C C

10. Miscellaneous uses
Adult businesses P* P*
Animal kennel C C
Auctions C C
Cemetery and related uses C C
Crematory — —
Construction trailer P* P*
Depot, bus P* P*
Greenhouse P P
Hotel P P
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Natural resource development ** **
Night watchmen or custodian quarters C C
Parks P P
Fire Station P P
Sec. 30-643. – Minimum development standards.
(2) Planning area 2—Auto center supporting uses.
a. Building setbacks.

1. All buildings and parking areas, except for allowed monument signs, shall be setback from all street property lines as follows:

Sierra Avenue: 25 Feet
South Highland Avenue: 20 Feet
Mango Avenue: 15 Feet
210 Freeway Right-of-way: 5 Feet

2. Monument signs are required to be set back a minimum of five feet from the street property line, and must comply with site distance traffic standards at all street corners and driveway entrances.
b. Building height.

1. Buildings and other structures shall not exceed a maximum of 60 feet as measured from the top of curb located adjacent to the street property line to the highest building ridge.
c. Lot coverage:

1. No more than 50 percent of the net lot area may be covered with buildings or other structures.
d. Off-street parking and circulation.

1. Required off-street parking spaces for retail shall be provided at the ratio set forth in Chapter 30 of the Fontana Municipal Code.

2. All parking spaces shall be a minimum of nine feet wide and 19 feet deep. 1682
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3. Drive aisle widths are required to be 26 feet wide unless otherwise required by the San Bernardino County Fire Department.
e. Landscaping.

1. All retail commercial uses shall have a minimum of 15 percent landscaping of the net project site (minus the building footprint).

2. Required setback areas shall be landscaped with trees, shrubs, plants, grasses and hardscape as set forth within the overlay district landscape design guidelines plant palette.

3. For projects that are adjacent to the 210 Freeway right-of-way, there shall be a minimum five-foot wide landscape strip planted with trees and shrubs.

4. Solid block walls adjacent to the 210 Freeway right-of-way are prohibited. The Freeway edge treatment shall consist of eight-foot tall pilasters at 30 feet on center with tubular or wrought iron fencing between pilasters. These pilasters shall be consistent with the design as set forth within the auto center design guidelines.
f. Lighting.

1. On-site lighting plans shall be submitted showing the design, intensity, layout and exact fixture mounting. Lighting plans shall be reviewed by City Staff and approved through the required Development Advisory Board (DAB) review process.

2. Lighting plans shall be consistent with the lighting design criteria and guidelines set forth within this overlay district.

3. Shielded fixtures shall direct all lighting downward, and shall illuminate areas used for parking and driveways.

4. All exterior areas shall have light standards no taller than 20 feet in height.

5. All lighting fixtures shall be properly shielded to prevent off-site glare. Spot fixtures shall only be downward directed, except at strategic areas such as monument signs and other landscape locations along the project's perimeter.

6. Strings of incandescent fixtures are not allowed in any exterior commercial area.
g. Walls, fences and screening. Walls and fences constructed on an interior lot line, at the rear of the required landscape setback area, or along the 210 Freeway rightof-way shall be in keeping with the development standards set forth herein. 1683
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1. Walls shall not exceed eight feet in height, except that within the required building and parking landscaped setback, walls may not exceed three feet in height.

2. All walls shall be constructed of split face or masonry material that is compatible with the building design.

3. Chain link fencing and all types of barbed wire are prohibited, except that chain link fencing is allowed during construction for security purposes.

4. All service and trash enclosure areas shall be screened from view from all public streets by walls and approved fencing, wherever feasible. No storage areas shall be visible from any public right-of-way, including the 210 Freeway.

5. Solid block walls are prohibited. Wall edge treatments shall consist of eightfoot tall pilasters at 30 feet on center with tubular or wrought iron fencing between pilasters. These pilasters shall be consistent with the design as set forth within the auto center design guidelines.

6. Roof mounted mechanical equipment shall be screened and not be visible from any public rights-of-way, including the 210 Freeway. Roof mounted equipment screening techniques shall involve an integrated architectural design element which is compatible with the architectural design of the commercial building.
h. Sound attenuation.

1. A drive-through lane is not permitted adjacent to any parcel of land that is zoned for residential use.
1684

NOTICE OF EXEMPTION
TO: Clerk of the Board of Supervisors
County of San Bernardino
385 N. Arrowhead Avenue, 2nd Floor
San Bernardino, CA 92415-0130
FROM:

City of Fontana
Planning Department
8353 Sierra Avenue
Fontana, CA 92335
Project Title: Master Case No. 24-019
Municipal Code Amendment No. 24-001
Project Location - Specific: Citywide
(a) Project Location - City: Fontana, CA
(b) Project Location - County: San Bernardino

1. Description of nature, purpose, and beneficiaries of Project: Municipal Code Amendment No. 24- 001 - Fontana Municipal Code amendment to Chapter 30 (Zoning and Development Code)

2. Name of Public Agency approving project: City of Fontana

3. Name of Person or Agency carrying out project: City of Fontana

4. Exempt status: (Check one)
(a) _____ Ministerial project.
(b) _____ Not a project.
(c) _____ Emergency Project.
(d) __X__ Categorical Exemption. State type and class number: Exempt under guidelines section Sections 15060(c), 15061(B)(3) (the common-sense exemption), and 15378 and Sections No. 3.01, 3.22, and 10.59 of the 2019 Local Guidelines for Implementing CEQA. (e) _____ Declared Emergency.
(f) _____ Statutory Exemption. State Code section number: _______________________ (g) _____ Other. Explanation: _______________________________________________

5. Reason why project was exempt: This project is a citywide code update to Chapter 9 of the Fontana Municipal Code. There is no associated development with this project.

6. Contact Person: Salvador Quintanilla, Senior Planner Telephone: (909) 350-6566 Date Received for Filing: __________________________________ DiTanyon Johnson
Principal Planner
(Clerk Stamp Here)
ATTACHMENT NO. 2
1685
ATTACHMENT NO. 3

NOTICE OF PUBLIC HEARING
Si desea información en Español referente a esta notificación o proyecto, favor de comunicarse al (909) 350-6728.

In compliance with Section No. 202 of the Americans with Disabilities Act of 1990 (42 U.S.C.

Sec. 12132) and the federal rules and regulations adopted in implementation thereof, the agenda will be made available in appropriate alternative formats to persons with a disability.

A PUBLIC HEARING HAS BEEN SCHEDULED BEFORE THE CITY COUNCIL OF THE CITY OF FONTANA FOR THE FOLLOWING:

Master Case No. 24-019 and Municipal Code Amendment No. 24-001: Update to the City of Fontana Municipal Code to amend to Chapter 30 (Zoning and Development Code). The Chapter 30 amendments include removal of language that references the Development Advisory Board (DAB), correction of the noticing requirements within the Tentative Parcel Map and Tentative Tract Map section, removal of maximum lot dimensions in the Form Based Code, addition of language regarding the size of the common and public open space in the Form Based Code, addition of language to clarify amenities that can be constructed in the Form Based Code, modification of the language of the Accessory Dwelling Units and Junior Accessory Dwelling Units section, and removal of certain broad use categories in the permitted uses table in the industrial zoning districts.

Environmental
Determination:

This project qualifies for a categorical exemption pursuant to the California Environmental Quality Act (CEQA) Guidelines Sections 15060(c), 15061(B)(3) (the common-sense exemption), and 15378 and Sections No.

3.01, 3.22, and 10.59 of the 2019 Local Guidelines for Implementing CEQA.

Location: Citywide
Date of Hearing: May 14, 2024
Place of Hearing: City Hall Council Chambers, 8353 Sierra Avenue, Fontana, CA, 92335 1686
Time of Hearing: 2:00 pm
Should you have any questions concerning this project, please contact Salvador Quintanilla, Senior Planner, at (909) 350-6656 or [email protected]

ANY INTERESTED PARTY MAY PROVIDE INFORMATION BY LETTER OR EMAIL WHICH MAY BE OF ASSISTANCE TO THE CITY COUNCIL. A COPY OF THE APPLICATION AND ENVIRONMENTAL DOCUMENTATION IS AVAILABLE FOR INSPECTION. PLEASE CONTACT THE PLANNER LISTED ABOVE.

IF YOU CHALLENGE IN COURT ANY ACTION TAKEN CONCERNING A PUBLIC HEARING ITEM,

YOU MAY BE LIMITED TO RAISING ONLY THOSE ISSUES YOU OR SOMEONE ELSE RAISED

AT THE PUBLIC HEARING DESCRIBED IN THIS NOTICE, OR IN WRITTEN CORRESPONDENCE TO THE CITY AT, OR PRIOR TO, THE PUBLIC HEARING.

Publish: May 3, 2024
¼ Page
1687
City of Fontana
Action Report
City Council Meeting
8353 Sierra Avenue
Fontana, CA 92335
File #: 21-3001 Agenda Date: 5/14/2024
Agenda #: F. Category: Public Hearing
FROM:

Finance
SUBJECT:

Public Hearing on Formation of Community Facilities District No. 113 (The Gardens Phase Two) RECOMMENDATION:

1. Adopt Resolution No. 2024-022, of the City Council of the City of Fontana of formation of the City of Fontana Community Facilities District No. 113 (The Gardens Phase Two), authorizing the levy of a special tax within the community facilities district and establishing an appropriations limit for the community facilities district.

2. Adopt Resolution No. 2024-023, of the City Council of the City of Fontana deeming it necessary to incur bonded indebtedness within the City of Fontana Community Facilities District No. 113 (The Gardens Phase Two).

3. Adopt Resolution No. 2024-024, of the City Council of the City of Fontana calling special election for City of Fontana Community Facilities District No. 113 (The Gardens Phase Two).

4. Adopt Resolution No. 2024-025, of the City Council of the City of Fontana declaring results of special election and directing the recording of notice of special tax lien.

5. Read by title only and waive further reading of and introduce Ordinance No. 1952 levying special taxes within the City of Fontana Community Facilities District No. 113 (The Gardens Phase Two); and that the reading of the title constitutes the first reading thereof.

6. Adopt Resolution No. 2024-026, of the City Council of the City of Fontana authorizing the execution and delivery of Joint Community Facilities Agreements.

7. Adopt Resolution No. 2024-027, of the City Council of the City of Fontana authorizing the execution and delivery of a Letter of Credit Agreement and an Acquisition and Funding Agreement.

COUNCIL GOALS:
· Practice sound fiscal management by developing long-term funding and debt management plans.

DISCUSSION:

North Fontana Investment Company, LLC and Richmond American Homes of Maryland, Inc. have initiated the process to form a Community Facilities District for the purpose of financing the City of Fontana Page 1 of 3 Printed on 5/8/2024
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File #: 21-3001 Agenda Date: 5/14/2024
Agenda #: F. Category: Public Hearing
initiated the process to form a Community Facilities District for the purpose of financing the acquisition of certain public facilities that are eligible under the City financing goals and policies, namely sewer, storm drain, street improvements, landscaping, and development impact fees. The formation of the district will benefit the City by funding the infrastructure projects outside of the typical improvements that would be required for the project including a contribution for a project of community benefit. CFD bond funding will allow for infrastructure to be built at one time, reducing construction inconvenience for earlier residents and enhancing the overall community aesthetics.

The project consists of approximately 36.37 gross (25.27 net taxable acres) (388 residential lots), is located on the west side of Sierra Avenue north of Casa Grande Avenue.

The proposed Rate and Method of Apportionment (RMA) includes rates to pay for bonded indebtedness and maintenance of street lighting, landscaping and parks. Initial assigned residential rates are proposed as follows:

Land
Use
Class
Planning
Area
Residential Floor Area Bond
Debt Maint Total
1 1 2,100 sf or Greater $4,137 $550 $4,687
2 1 1,950 to less than 2,100 sf $3,956 $550 $4,506
3 1 1,800 to less than 1,950 sf $3,775 $550 $4,325
4 1 1,650 to less than 1,800 sf $3,554 $550 $4,104
5 1 Less than 1,650 sf $3,344 $550 $3,894
6 2 2,100 sf or greater $3,946 $550 $4,496
7 2 1,950 to less than 2,100 sf $3,759 $550 $4,309
8 2 1,800 to less than 1,950 sf $3,572 $550 $4,122
9 2 1,650 to less than 1,800 sf $3,385 $550 $3,935
10 2 Less than 1,650 sf $3,198 $550 $3,748
11 3 & 4 2,225 sf or Greater $4,604 $550 $5,154
12 3 & 4 2,075 to less than 2,225 sf $4,259 $550 $4,809 13 3 & 4 1,925 to less than 2,075 sf $3,914 $550 $4,464 14 3 & 4 1,775 to less than 1,925 sf $3,699 $550 $4,249 15 3 & 4 Less than 1,775 sf $3,549 $550 $4,099
Sales prices for the homes have been estimated at $478,400 to $613,600. The proposed rates have been established to provide a total tax rate of less than 1.95% of the home value per City Policy.

The proposed rates for bonded indebtedness will support $17.6 million of bonds, providing funds to finance $14.8 million of facilities and/or fees. The proposed annual rates for maintenance of $550 for all planning areas will be sufficient to fund the annual maintenance costs for street lighting, landscaping and parks within and surrounding the area of the CFD. The rate also includes the maintenance costs related to the water quality system required by the State of California. The maximum annual tax rate for maintenance has been set at $770 per unit for planning areas with a 2% escalator per City Policy.

City of Fontana Page 2 of 3 Printed on 5/8/2024
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File #: 21-3001 Agenda Date: 5/14/2024
Agenda #: F. Category: Public Hearing
This action will form the District, authorize the levy of the special tax and authorize bonded indebtedness. The recommended action complies with the City Council’s debt management objectives.

FISCAL IMPACT:

This District will provide annual funding for maintenance costs, administration and debt service costs once bonds are issued.

MOTION:

Approve staff recommendation.

City of Fontana Page 3 of 3 Printed on 5/8/2024
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4128-6910-7534.3
RESOLUTION NO. ___

A RESOLUTION OF THE CITY COUNCIL OF THE CITY

OF FONTANA OF FORMATION OF CITY OF FONTANA
COMMUNITY FACILITIES DISTRICT NO. 113 (THE

GARDENS PHASE TWO), PROPOSING THAT THE

COMMUNITY FACILITIES DISTRICT BE AUTHORIZED

TO LEVY A SPECIAL TAX AND PROPOSING THAT AN

APPROPRIATIONS LIMIT OF THE COMMUNITY

FACILITIES DISTRICT BE ESTABLISHED
WHEREAS, on April 9, 2024, the City Council (the “City Council”) of the City of Fontana (the “City”), pursuant to the Mello-Roos Community Facilities Act of 1982 (the “Act”), adopted a resolution entitled “A Resolution of the City Council of the City of Fontana of Intention to Establish a Community Facilities District Proposed to be Named City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) and to Authorize the Levy of a Special Tax Therein” (the “Resolution of Intention”), stating its intention to establish City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) (the “Community Facilities District”), to authorize the Community Facilities District to levy a special tax within the Community Facilities District for the purpose of financing certain public facilities and services and setting the date for a public hearing to be held on the establishment of the Community Facilities District;
WHEREAS, pursuant to the Resolution of Intention, notice of said public hearing was published in the Fontana Herald News, a newspaper of general circulation published in the area of the Community Facilities District, in accordance with the Act; WHEREAS, on this date, the City Council opened, conducted and closed said public hearing;
WHEREAS, pursuant to the Resolution of Intention, each officer of the City who is or will be responsible for providing one or more of the proposed types of public facilities or services to be financed by the Community Facilities District was directed to study, or cause to be studied, the proposed Community Facilities District and, at or before said public hearing, file a report with the City Council containing a brief description of the public facilities and services by type that will in his or her opinion be required to adequately meet the needs of the Community Facilities District, and his or her estimate of the cost of providing such public facilities and services; such officers were also directed to estimate the fair and reasonable cost of the public facilities proposed to be purchased as completed public facilities and of the incidental expenses proposed to be paid; WHEREAS, said report was so filed with the City Council and made a part of the record of said public hearing;
WHEREAS, at the hearing, the testimony of all persons for or against the establishment of the Community Facilities District, the extent of the Community Facilities District and the furnishing of the specified types of public facilities and services was heard; 1691
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WHEREAS, written protests against the establishment of the Community Facilities District, the furnishing of any specified type or types of facilities and services within the Community Facilities District or the levying of a specified special tax were not made or filed at or before said hearing by 50% or more of the registered voters, or six registered voters, whichever is more, residing within the territory proposed to be included in the Community Facilities District, or the owners of one-half or more of the area of land in the territory proposed to be included in the Community Facilities District and not exempt from the special tax; WHEREAS, there has been filed with the City Clerk of the City a letter from the Registrar of Voters of the County of San Bernardino indicating that no persons were registered to vote within the territory of the proposed Community Facilities District as of April 19, 2024, which demonstrates that 12 or more persons have not been registered to vote within the territory of the proposed Community Facilities District for each of the 90 days preceding the close of said public hearing;
WHEREAS, Section 53314.9 of the Act provides that, at any time either before or after the formation of a community facilities district, the legislative body may accept advances of funds from any source, including, but not limited to, private persons or private entities and may provide, by resolution, for the use of those funds for any authorized purpose, including, but not limited to, paying any cost incurred by the local agency in creating a community facilities district; WHEREAS, Section 53314.9 of the Act further provides that the legislative body may enter into an agreement, by resolution, with the person or entity advancing the funds, to repay all or a portion of the funds advanced, as determined by the legislative body, with or without interest, under all the following conditions: (a) the proposal to repay the funds is included in both the resolution of intention to establish a community facilities district adopted pursuant to Section 53321 of the Act and in the resolution of formation to establish a community facilities district pursuant to Section 53325.1 of the Act, (b) any proposed special tax is approved by the qualified electors of the community facilities district pursuant to the Act, and (c) any agreement shall specify that if the qualified electors of the community facilities district do not approve the proposed special tax, the local agency shall return any funds which have not been committed for any authorized purpose by the time of the election to the person or entity advancing the funds; WHEREAS, the City and North Fontana Investment Company, LLC (“North Fontana Investment Company”), have entered into the Deposit and Reimbursement Agreement, dated as of December 1, 2023 (the “Deposit Agreement”), that provides for the advancement of funds by North Fontana Investment Company to be used to pay costs incurred in creating the Community Facilities District and the incurrence of bonded indebtedness thereby, and provides for the repayment to North Fontana Investment Company of such funds advanced, without interest, from the proceeds of any such bonded indebtedness incurred by the Community Facilities District; and WHEREAS, the City desires to include in this Resolution, in accordance with Section 53314.9 of the Act, the proposal to repay funds pursuant to the Deposit Agreement; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Fontana as follows:
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Section 1. The foregoing recitals are true and correct, and the City Council so finds and determines.

Section 2. The Community Facilities District is hereby established.

Section 3. The name for the Community Facilities District is “City of Fontana Community Facilities District No. 113 (The Gardens Phase Two).”
Section 4. The public facilities (the “Facilities”) proposed to be financed by the Community Facilities District pursuant to the Act are described under the caption “Facilities” on Exhibit A hereto, which is by this reference incorporated herein. Those Facilities proposed to be purchased as completed public facilities are identified under the caption “Facilities to be Purchased” on Exhibit A hereto. The services (the “Services”) proposed to be financed by the Community Facilities District pursuant to the Act are described under the caption “Services” on Exhibit A hereto. The incidental expenses proposed to be incurred are identified under the caption “Incidental Expenses” on Exhibit A hereto. All or any portion of the Facilities may be financed through a financing plan, including, but not limited to, a lease, lease-purchase or installmentpurchase arrangement.

Section 5. The proposed special tax to be levied within the Community Facilities District has not been precluded by majority protest pursuant to Section 53324 of the Act.

Section 6. The City Council proposes that, except where funds are otherwise available, the Community Facilities District be authorized to annually levy within the Community Facilities District a special tax (the “Special Tax”) sufficient to pay for all Facilities and Services, secured by recordation of a continuing lien against all nonexempt real property in the Community Facilities District. The rate, method of apportionment and manner of collection of the Special Tax in sufficient detail to allow each landowner or resident within the proposed Community Facilities District to estimate the maximum amount that he or she will have to pay, is specified in the Rate and Method of Apportionment of Special Tax (the “Rate and Method”) attached hereto as Exhibit B, which is by this reference incorporated herein. The conditions under which the obligation to pay the Special Tax to be levied to pay for Facilities may be prepaid and permanently satisfied are specified in the Rate and Method. The Special Tax will be collected in the same manner as ordinary ad valorem property taxes or in such other manner as the City Council shall determine, including direct billing of the affected property owners.

Section 7. The Special Tax may only finance the Services to the extent that they are in addition to those provided in the territory of the Community Facilities District before the date the Community Facilities District is created. The Services may not supplant services already available within that territory when the Community Facilities District is created. Bonds of the Community Facilities District may not be issued to fund any of the Services.

Section 8. The tax year after which no further Special Tax to pay for Facilities shall be levied against any parcel used for private residential purposes is specified in the Rate and Method.

Under no circumstances shall the Special Tax to pay for Facilities in any fiscal year against any parcel used for private residential purposes be increased as a consequence of delinquency or default by the owner or owners of any other parcel or parcels within the Community Facilities District by 1693
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more than 10% above the amount that would have been levied in that fiscal year had there never been any such delinquencies or defaults. For purposes of this paragraph, a parcel shall be considered “used for private residential purposes” not later than the date on which an occupancy permit for private residential use is issued. The Special Tax to pay for Services will be levied in perpetuity, as provided in the Rate and Method.

Section 9. Pursuant to Section 53344.1 of the Act, the City Council hereby reserves to itself the right and authority to allow any interested owner of property within the Community Facilities District, subject to the provisions of said Section 53344.1 and to those conditions as it may impose, and any applicable prepayment penalties as prescribed in the bond indenture or comparable instrument or document, to tender to the Community Facilities District treasurer in full payment or part payment of any installment of the Special Tax or the interest or penalties thereon that may be due or delinquent, but for which a bill has been received, any bond or other obligation secured thereby, the bond or other obligation to be taken at par and credit to be given for the accrued interest shown thereby computed to the date of tender.

Section 10. The name, address and telephone number of the office, department or bureau that will be responsible for preparing annually a current roll of Special Tax levy obligations by assessor’s parcel number and that will be responsible for estimating further Special Tax levies pursuant to Section 53340.2 of the Act are as follows: Chief Financial Officer, Finance Department, City of Fontana, 8353 Sierra Avenue, Fontana, California 92335, (909) 350-7679.

Section 11. Upon recordation of a notice of special tax lien pursuant to Section 3114.5 of the California Streets and Highways Code, a continuing lien to secure each levy of the Special Tax shall attach to all nonexempt real property in the Community Facilities District and this lien shall continue in force and effect until the Special Tax obligation is prepaid, permanently satisfied and canceled in accordance with law or until the Special Tax ceases to be levied and a notice of cessation of the Special Tax is recorded in accordance with Section 53330.5 of the Act.

Section 12. The boundary map of the Community Facilities District has been recorded in San Bernardino County in Book 56 at Page 91 of Maps of Assessments and Community Facilities Districts in the San Bernardino County Recorder’s Office (Document No. 2024-0089360).

Section 13. The City Council proposes that the annual appropriations limit, as defined by subdivision (h) of Section 8 of Article XIII B of the California Constitution, of the Community Facilities District be established at $24,000,000.

Section 14. Pursuant to the provisions of the Act, the propositions to authorize the Community Facilities District to levy the Special Tax and to establish the appropriations limit of the Community Facilities District specified above shall be subject to the approval of the qualified electors of the Community Facilities District at a special election. The City Council hereby finds and determines that no persons were registered to vote within the territory of the proposed Community Facilities District as of April 19, 2024, and that 12 or more persons have not been registered to vote within the territory of the Community Facilities District for each of the 90 days preceding the close of the public hearing held by the City Council on the establishment of the Community Facilities District. Accordingly, pursuant to Section 53326 of the Act, the vote shall be by the landowners of the Community Facilities District and each person who is the owner of 1694
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land as of the close of said public hearing, or the authorized representative thereof, shall have one vote for each acre or portion of an acre that he or she owns within the Community Facilities District not exempt from the Special Tax. The voting procedure shall be by mailed or hand-delivered ballot.

Section 15. North Fontana Investment Company has heretofore advanced certain funds, and may advance additional funds, that have been or may be used to pay costs incurred in creating the Community Facilities District and the incurrence of bonded indebtedness thereby. The City Council has previously approved the acceptance of such funds for the purpose of paying costs incurred in creating the Community Facilities District and the incurrence of bonded indebtedness thereby. The City Council proposes to repay North Fontana Investment Company all or a portion of such funds so advanced, without interest, solely from the proceeds of any such bonded indebtedness incurred by the Community Facilities District, pursuant to the Deposit Agreement.

The Deposit Agreement is hereby incorporated herein as though set forth in full herein.

Section 16. The City Council hereby finds and determines that all proceedings, up to and including the adoption of this Resolution, were valid and in conformity with the requirements of the Act. In accordance with Section 53325.1 of the Act, such finding shall be final and conclusive.

Section 17. All actions heretofore taken by the officers, employees and agents of the City with respect to the establishment of the Community Facilities District, or in connection with or related to any of the matters referred to herein, are hereby approved, confirmed and ratified.

Section 18. The officers, employees and agents of the City are hereby authorized and directed to take all actions and do all things that they, or any of them, may deem necessary or desirable to accomplish the purposes of this Resolution and not inconsistent with the provisions hereof.

Section 19. This Resolution shall take effect immediately upon its adoption.

APPROVED and ADOPTED by the City Council of the City of Fontana on May 14, 2024.

READ AND APPROVED AS TO LEGAL FORM:

City Attorney
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EXHIBIT A

FACILITIES, SERVICES AND INCIDENTAL EXPENSES
Facilities
The types of public facilities to be financed by the Community Facilities District are streets, including grading, paving, curbs and gutters, sidewalks, street signalization and signage, street lights and parkway and landscaping related thereto, sewers, storm drains, flood control facilities, fire protection facilities, police facilities, public facilities, landscaping, library facilities, park and recreational facilities, water distribution, treatment and storage facilities, and land, rights-of-way and easements necessary for any of such facilities.

Facilities to be Purchased
The types of public facilities to be purchased as completed facilities are streets, including grading, paving, curbs and gutters, sidewalks, street signalization and signage, street lights and parkway and landscaping related thereto, sewers, storm drains, water distribution, treatment and storage facilities, and land, rights-of-way and easements necessary for any of such facilities.

Services
The types of City services to be financed by the Community Facilities District are fire protection and suppression services, maintenance and lighting of parks, parkways, streets, roads and open space, flood and storm protection services and maintenance and operation of any real property or other tangible property with an estimated useful life of five or more years that is owned by the City.

Incidental Expenses
The incidental expenses proposed to be incurred include the following:
(a) the cost of planning and designing public facilities to be financed, including the cost of environmental evaluations of those facilities; (b) the costs associated with the creation of the Community Facilities District, issuance of bonds, determination of the amount of taxes, collection of taxes, payment of taxes, or costs otherwise incurred in order to carry out the authorized purposes of the Community Facilities District; and
(c) any other expenses incidental to the construction, completion, and inspection of the authorized work.
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EXHIBIT B

RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX
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Community Facilities District No. 113 (The Gardens Phase Two) Page 1

RATE AND METHOD OF APPORTIONMENT FOR
CITY OF FONTANA COMMUNITY FACILITIES DISTRICT NO. 113
(THE GARDENS PHASE TWO)
A Special Tax as hereinafter defined shall be levied on all Assessor's Parcels of Taxable Property in City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) ("CFD No. 113") and collected each Fiscal Year, in an amount determined by the City Council of the City of Fontana, through the application of the Rate and Method of Apportionment as described below.

All of the real property in CFD No. 113, 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. DEFINITIONS
The terms hereinafter set forth have the following meanings:
"Acre" or "Acreage" means the land area expressed in acres of an Assessor’s Parcel as shown on an Assessor’s Parcel Map, or if the land area is not shown on an Assessor’s Parcel Map, the land area shown on the applicable final map, parcel map, condominium plan, or other recorded County map or the land area calculated to the reasonable satisfaction of the CFD Administrator using the boundaries set forth on such map or plan. For residential dwelling units within a condominium plan, the Acres applicable to each residential dwelling unit shall be determined by dividing (i) the Acres of the underlying lot or parcel on which the residential dwelling unit is constructed or to be constructed, by (ii) the total number of residential dwelling units constructed or to be constructed on such lot or parcel. 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, Part 1, Division 2 of Title 5 (commencing with Section 53311) of the California Government Code.
"Administrative Expenses" means the following actual or reasonably estimated costs directly related to the administration of CFD No. 113, including but not limited to: the costs of computing the Special Taxes and preparing the annual Special Tax collection schedules (whether by the City or designee thereof or both); the costs of collecting the Special Taxes (whether by the County or otherwise); the costs of remitting the Special Taxes to the Trustee; the costs of the Trustee (including its legal counsel) in the discharge of the duties required of it under the Indenture; the costs to the City, CFD No. 113 or any designee thereof of complying with arbitrage rebate requirements with respect to the Special Tax and CFD No. 113 Bonds; the costs to the City, CFD No. 113 or any designee thereof of complying with disclosure requirements of the City, CFD No. 113 or obligated persons associated with applicable federal and state securities laws and the Act; the costs associated with preparing Special Tax disclosure statements and responding to public inquiries regarding the Special Taxes; the costs of the City, CFD No. 113, or any designee thereof related to the reduction of the Assigned Facilities Special Tax and Backup Facilities Special Tax in accordance with Section C.1 herein; the costs of the City, CFD No. 113 or any designee thereof related to an appeal of the Special Tax; and the City’s annual administration fees and third party expenses related to CFD No. 113 Bonds. Administrative Expenses shall also include amounts estimated or advanced by the City or CFD No. 113 for any other administrative purposes of CFD No. 113, including attorney’s fees and other costs related to commencing and pursuing to completion any foreclosure of delinquent Special Taxes. 1698
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Community Facilities District No. 113 (The Gardens Phase Two) Page 2 "Assessor" means the Assessor of the County.
"Assessor's Parcel" means a lot or parcel to which an Assessor’s parcel number is assigned as determined from an Assessor’s Parcel Map or the applicable assessment roll. "Assessor's Parcel Map" means an official map of the Assessor designating parcels by Assessor’s Parcel number.
"Assigned Facilities Special Tax" means the applicable Facilities Special Tax for (i) Residential Property as determined in accordance with Section C.1.a.(2) herein, and (ii) NonResidential Property as determined in accordance with Section C.1.a.(3) herein. "Assigned Services Special Tax" means the Services Special Tax, determined in accordance with Section C.2.b herein, that can be levied in any Fiscal Year on any Assessor’s Parcel of Developed Property.
"Authorized Facilities" means those facilities eligible to be funded by CFD No. 113. "Authorized Services" means those services eligible to be funded by CFD No. 113 in accordance with the Act, namely, fire protection and suppression services, maintenance and lighting of parks, parkways, streets, roads and open space, flood and storm protection services and maintenance and operation of any real property or other tangible property with an estimated useful life of five or more years that is owned by the City. "Backup Facilities Special Tax" means the Facilities Special Tax applicable to each Assessor's Parcel of Developed Property, as determined in accordance with Section C.1.a.(4) herein. "Buildout" means, for CFD No. 113, that all expected building permits for residential dwelling units and/or non-residential development to be constructed within CFD No. 113 have been issued, as determined by the CFD Administrator.
"CFD Administrator" means an official of the City, or designee thereof, responsible for determining the Special Tax Requirement for Facilities and the Special Tax Requirement for Services, providing for the levy and collection of the Special Taxes, and performing other duties as set forth herein.
"CFD No. 113" means City of Fontana Community Facilities District No. 113 (The Gardens Phase Two).
"CFD No. 113 Bonds" means any bonds or other debt (as defined in Section 53317(d) of the Act), whether in one or more series, issued by CFD No. 113 and secured by the Facilities Special Tax levy on property within the boundaries of CFD No. 113 under the Act. "City" means the City of Fontana, California.
"Contractual Impositions" means (a) a voluntary contractual assessment established and levied on an Assessor’s Parcel pursuant to Chapter 29 of Part 3 of Division 7 of the California Streets and Highways Code (commencing with Section 5898.10 et seq.), as amended from time to time, (b) a special tax established and levied on an Assessor’s Parcel pursuant to Section 53328.1 of the California Government Code and related provisions of the Act, as amended from time to time, and (c) any other fee, charge, tax or assessment established and levied on an individual Assessor’s Parcel pursuant to a contractual agreement or other voluntary consent by the owner thereof.
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Community Facilities District No. 113 (The Gardens Phase Two) Page 3 "Council" means the City Council of the City acting as the legislative body of CFD No. 113. "County" means the County of San Bernardino.
"Developed Property" means, for each Fiscal Year, (i) with respect to the Facilities Special Tax, all Taxable Property, exclusive of Taxable Public Property and Taxable Property Owner Association Property, for which a building permit for new construction, other than the construction of a garage, parking lot, or parking structure, was issued after January 1, 2024 and on or before May 1 of the Fiscal Year preceding the Fiscal Year for which the Facilities Special Taxes are being levied, and (ii) with respect to the Services Special Tax, all Taxable Property, exclusive of Taxable Public Property and Taxable Property Owner Association Property, (a) for which the Final Residential Subdivision was recorded prior to the Fiscal Year for which the Services Special Taxes are being levied, or (b) for which a building permit has been issued with respect to Non-Residential Property on or before May 1 of the Fiscal Year preceding the Fiscal Year for which the Services Special Taxes are being levied. "Facilities Special Tax" means the special tax to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property within CFD No. 113 to fund the Special Tax Requirement for Facilities, as set forth in Section C.1 herein.
"Final Residential Subdivision" means a Final Subdivision that creates individual lots for which building permits may be issued for residential dwelling units without further subdivision of such property.
"Final Subdivision" means (i) a subdivision of property by recordation of a final map, parcel map, or lot line adjustment approved by the City pursuant to the Subdivision Map Act (California Government Code Section 66410 et seq.) that creates individual lots or parcels for which building permits may be issued, or (ii) for condominiums, a final map approved by the City and a condominium plan recorded pursuant to California Civil Code Section 4285 that creates an individual lot(s) for which a building permit(s) may be issued without further subdivision. The term "Final Subdivision" shall not include any Assessor’s Parcel Map or subdivision map or portion thereof that does not create individual lots for which a building permit may be issued, including Assessor’s Parcels that are designated as remainder parcels.

Notwithstanding the above, a condominium plan for which one or more building permits have been issued, but no individual lots have been created for such building permits, shall be considered a Final Subdivision, and the portion of the condominium plan for which building permits have been issued shall be defined as Developed Property. "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 CFD No. 113 Bonds are issued, as modified, amended and/or supplemented from time to time.
"Land Use Class" means any of the classes listed in Table 1, Table 5, or Table 6 herein. "Lower Income Households Welfare Exemption Property" means, for each Fiscal Year, an Assessor’s Parcel within the boundaries of CFD No. 113 that is subject to a welfare exemption under subdivision (g) of Section 214 of the California Revenue and Taxation Code (or any successor statute), as indicated in the County’s assessment roll finalized as of the last preceding January 1.
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Community Facilities District No. 113 (The Gardens Phase Two) Page 4 "Maximum Facilities Special Tax" means the maximum Facilities Special Tax, determined in accordance with Section C.1 herein, that can be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.
"Maximum Services Special Tax" means the maximum Services Special Tax, determined in accordance with Section C.2 herein, that can be levied in any Fiscal Year on any Assessor’s Parcel of Developed Property.
"Minimum Sale Price" means the minimum price at which any parcel in a given Land Use Class has sold or is expected to be sold in a normal marketing environment and shall not include prices for such parcels that are sold at a discount to expected sales prices for the purpose of stimulating the initial sales activity with respect to such Land Use Class. "Non-Residential Property" means all Assessor’s Parcels of Developed Property for which a building permit(s) has been issued by the City permitting the construction of one or more nonresidential structures or facilities. "Outstanding Bonds" means all CFD No. 113 Bonds which are outstanding under the Indenture.
"Planning Area" means an area designated with the letters "P.A." as shown on Exhibit B. "Price Point Consultant" means any consultant or firm of such consultants selected by CFD No. 113 that (a) has substantial experience in performing price point studies for residential dwelling units within community facilities districts or otherwise estimating or confirming pricing for residential dwelling units in community facilities districts, (b) has recognized expertise in analyzing economic and real estate data that relates to the pricing of residential dwelling units in community facilities districts, (c) is in fact independent and not under the control of CFD No. 113 or the City, (d) does not have any substantial interest, direct or indirect, with or in (i) CFD No. 113, (ii) the City, (iii) any owner of real property in CFD No. 113, or (iv) any real property in CFD No. 113, and (e) is not connected with CFD No. 113 or the City as an officer or employee thereof, but who may be regularly retained to make reports to CFD No. 113 or the City.
"Price Point Study" means a price point study or a letter updating a previous price point study prepared by the Price Point Consultant pursuant to Section C herein. "Property Owner Association Property" means, for each Fiscal Year, (i) any property within the boundaries of CFD No. 113 for which the owner of record, as determined from the County’s assessment roll for the Fiscal Year in which the Special Tax is being levied, is a property owner’s association, including any master or sub-association, or (ii) any property located in a Final Subdivision that was recorded as of the January 1 preceding the Fiscal Year in which the Special Tax is being levied and which, as determined from such Final Subdivision, is or will be open space, a common area recreation facility, or a private street. Notwithstanding the foregoing, any property previously classified as Developed Property and subsequently owned in fee or by easement, or dedicated to, a property owner association, including any master or subassociation, shall remain classified as Developed Property. "Proportionately" means that the ratio of the actual Facilities Special Tax levy to the Assigned Facilities Special Tax is equal for all Assessor’s Parcels of Developed Property, and that the ratio of the actual Services Special Tax levy to the Assigned Services Special Tax is equal for all Assessor’s Parcels of Developed Property. For Undeveloped Property, "Proportionately" means 1701
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Community Facilities District No. 113 (The Gardens Phase Two) Page 5 that the ratio of the actual Facilities Special Tax levy per Acre to the Maximum Facilities Special Tax per Acre is equal for all Assessor’s Parcels of Undeveloped Property. The term "Proportionately" shall similarly be applied to other categories of Taxable Property as listed in Section D herein.
"Public Property" means, for each Fiscal Year, any property within the boundaries of CFD No. 113 that is (i) owned by, irrevocably offered or dedicated to the federal government, the State, the County, the City, or any local government or other public agency, provided, however, that any property leased by a public agency to a private entity and subject to taxation under Section 53340.1 of the Act shall be taxed and classified according to its use; or (ii) encumbered by a public utility easement making impractical its use for any purpose other than that set forth in the easement.
"Rate and Method of Apportionment" means this Rate and Method of Apportionment for CFD No. 113.
"Residential Floor Area" means all of the square footage of living area within the perimeter of a residential structure, not including any carport, walkway, garage, overhang, patio, enclosed patio, or similar area. The determination of Residential Floor Area for an Assessor’s Parcel shall be as set forth in the building permit(s) issued for such Assessor’s Parcel and/or as set forth in the appropriate records kept by the Building and Safety Department of the City, or other applicable City department, as determined by the CFD Administrator. "Residential Property" means all Assessor’s Parcels of Developed Property for which a building permit(s) has been issued by the City permitting the construction thereon of one or more residential dwelling units.
"Services Special Tax" means the special tax to be levied in each Fiscal Year on each Assessor’s Parcel of Developed Property within CFD No. 113 to fund the Special Tax Requirement for Services, as set forth in Section C.2 herein. "Special Tax" or "Special Taxes" means the Facilities Special Tax and/or Services Special Tax, as applicable.
"Special Tax Requirement for Facilities" means, for any Fiscal Year, that amount required, after taking into account available amounts held in the funds and accounts under the Indenture, for the following items: (i) debt service on all Outstanding Bonds due in the calendar year commencing in such Fiscal Year; (ii) periodic costs with respect to the CFD No. 113 Bonds, including but not limited to, costs of credit enhancement and federal rebate payments due in the calendar year commencing in such Fiscal Year; (iii) pay all or a portion of Administrative Expenses; (iv) any amounts required to establish or replenish any reserve funds for all Outstanding Bonds; (v) without duplicating any amounts described in clause (iv), above, reasonably anticipated Facilities Special Tax delinquencies based on the delinquency rate for the Facilities Special Tax in the previous Fiscal Year, as said levy for delinquencies shall be limited by the Act; and (vi) pay directly for the acquisition or construction of Authorized Facilities, provided that the inclusion of such amount does not increase the Facilities Special Tax levy beyond the first step in Section D.1 herein.
"Special Tax Requirement for Services" means that amount required in any Fiscal Year for CFD No. 113 to (i) pay directly for the Authorized Services; (ii) pay Administrative Expenses not funded through the Special Tax Requirement for Facilities as determined by the CFD 1702
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Community Facilities District No. 113 (The Gardens Phase Two) Page 6 Administrator; (iii) pay for reasonably anticipated Services Special Tax delinquencies based on the delinquency rate for the Services Special Tax levy in the previous Fiscal Year; less (iv) a credit for funds available to reduce the annual Services Special Tax levy, as determined by the CFD Administrator, so long as the amount required is not less than zero. "State" means the State of California.
"Taxable Property" means all of the Assessor's Parcels within the boundaries of CFD No. 113 which are not exempt from the Special Tax pursuant to applicable law or Section E herein. "Taxable Property Owner Association Property" means all Assessor’s Parcels of Property Owner Association Property that are not exempt pursuant to Section E herein. "Taxable Public Property" means all Assessor’s Parcels of Public Property that are not exempt pursuant to Section E herein.
"Total Tax Burden" means, for a parcel of residential property within a Land Use Class, for the Fiscal Year in which Total Tax Burden is being calculated, the sum of (a) the Assigned Facilities Special Tax for such Fiscal Year, plus (b) the Assigned Services Special Tax for such Fiscal Year, plus (c) the ad valorem property taxes, special assessments, special taxes for any overlapping community facilities districts, and any other governmental fees, charges (other than fees or charges for services such as sewer and trash), taxes and assessments (which, for purposes of clarity, do not include Contractual Impositions) collected by the County on ad valorem tax bills and that the CFD Administrator estimates would be levied or imposed on such residential property in such Fiscal Year if the residential dwelling unit thereon or therein had been completed and sold, and was subject to such fees, charges, taxes and assessments in such Fiscal Year.
"Trustee" means the trustee or fiscal agent under the Indenture. "Undeveloped Property" means, for each Fiscal Year, all Taxable Property not classified as Developed Property, Taxable Public Property or Taxable Property Owner Association Property.

Please refer to additional definitions in Section H herein relating to the Prepayment of Facilities Special Tax.

B. ASSIGNMENT TO LAND USE CATEGORIES
Each Fiscal Year, commencing with Fiscal Year 2024-2025, all Taxable Property within CFD No. 113 shall be classified as Developed Property, Undeveloped Property, Taxable Public Property or Taxable Property Owner Association Property, and shall be subject to Special Taxes in accordance with this Rate and Method of Apportionment determined pursuant to Sections C and D herein.

C. MAXIMUM SPECIAL TAX RATE

1. Facilities Special Tax
At least 30 days prior to the issuance of the first series of CFD No. 113 Bonds, the Assigned Facilities Special Tax for Residential Property (set forth in Table 1 below) shall be analyzed in accordance with and subject to the conditions set forth in this Section C. At such time, the CFD Administrator shall request the Price Point Consultant to prepare a Price Point Study setting forth the Minimum Sale Price of residential property within each Land Use Class. If based upon such Price Point Study the CFD Administrator calculates that the Total Tax Burden applicable to one 1703
City of Fontana March 20, 2024
Community Facilities District No. 113 (The Gardens Phase Two) Page 7 or more Land Use Classes of residential property constructed or to be constructed within CFD No. 113 shall exceed 1.95% of the Minimum Sale Price of such residential property constructed or to be constructed within CFD No. 113, the CFD Administrator shall reduce the Assigned Facilities Special Tax to the extent necessary to cause the Total Tax Burden that shall apply to residential property within such Land Use Class(es) to not exceed 1.95% of the Minimum Sale Price of such residential property. Each Assigned Facilities Special Tax reduction for a Land Use Class shall be calculated separately, and it shall not be required that such reduction be proportionate among Land Use Classes. In connection with any reduction in the Assigned Facilities Special Tax for Residential Property, the CFD Administrator shall also reduce the Assigned Facilities Special Tax for Non-Residential in accordance with Section C.1.a.(3) herein, and the Backup Facilities Special Tax in accordance with Section C.1.a.(4) herein. Upon determining the reductions, if any, in the Assigned Facilities Special Tax and Backup Facilities Special Tax required pursuant to this Section C, the CFD Administrator shall complete the Certificate to Amend Facilities Special Tax substantially in the form attached hereto as Exhibit A (the “Certificate to Amend”) and shall execute such completed Certificate to Amend and shall deliver such Certificate to Amend to CFD No. 113. Upon receipt thereof, if in satisfactory form, CFD No. 113 shall execute such Certificate to Amend. The reduced Assigned Facilities Special Tax and Backup Facilities Special Tax specified in such Certificate to Amend shall become effective upon the execution of such Certificate to Amend by CFD No. 113. The Assigned Facilities Special Tax and Backup Facilities Special Tax reductions permitted pursuant to this Section C shall be reflected in an amended notice of Special Tax lien which CFD No. 113 shall cause to be recorded with the San Bernardino County Recorder as soon as practicable after execution of the Certificate to Amend by CFD No. 113. If based upon such Price Point Study the CFD Administrator calculates that the Total Tax Burden applicable to each Land Use Class of residential property constructed or to be constructed within CFD No. 113 does not exceed

1.95% of the Minimum Sale Price of each such Land Use Class of residential property constructed or to be constructed within CFD No. 113, then there shall be no reduction in the Assigned Facilities Special Tax, nor shall there be a reduction in the Backup Facilities Special Tax.
a. Developed Property
(1). Maximum Facilities Special Tax
The Maximum Facilities Special Tax for each Assessor's Parcel classified as Developed Property shall be the greater of (i) the amount derived by application of the Assigned Facilities Special Tax or (ii) the amount derived by application of the Backup Facilities Special Tax.
(2). Assigned Facilities Special Tax for Residential Property Residential Property shall be assigned to Land Use Classes 1 through 15 as listed in Table 1 below based on the Planning Area, Description, and the Residential Floor Area associated with each such residential dwelling unit. The Assigned Facilities Special Tax that shall be levied in any Fiscal Year for each Land Use Class is shown below in Table 1 and shall not be subject to escalation.
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Community Facilities District No. 113 (The Gardens Phase Two) Page 8 Table 1
Assigned Facilities Special Tax for Residential Property City of Fontana CFD No. 113 (The Gardens Phase Two)
Land
Use
Class
Planning
Area Description
Residential Floor
Area (square feet)
Assigned
Facilities
Special Tax
1 Planning
Area 1
Residential Property 2,100 or greater $4,137 per unit
2 Residential Property 1,950 to less than 2,100 $3,956 per unit 3 Residential Property 1,800 to less than 1,950 $3,775 per unit 4 Residential Property 1,650 to less than 1,800 $3,554 per unit 5 Residential Property Less than 1,650 $3,344 per unit
6 Planning
Area 2
Residential Property 2,100 or greater $3,946 per unit
7 Residential Property 1,950 to less than 2,100 $3,759 per unit 8 Residential Property 1,800 to less than 1,950 $3,572 per unit 9 Residential Property 1,650 to less than 1,800 $3,385 per unit 10 Residential Property Less than 1,650 $3,198 per unit 11 Planning
Areas
3 & 4
Residential Property 2,225 or greater $4,604 per unit
12 Residential Property 2,075 to less than 2,225 $4,259 per unit 13 Residential Property 1,925 to less than 2,075 $3,914 per unit 14 Residential Property 1,775 to less than 1,925 $3,699 per unit 15 Residential Property Less than 1,775 $3,549 per unit (3). Assigned Facilities Special Tax for Non-Residential Property The Assigned Facilities Special Tax for an Assessor’s Parcel of Non-Residential Property within a Planning Area shall equal the lesser of (a) the Assigned Facilities Special Tax applicable for such Planning Area set forth in Table 2 below (as such Assigned Facilities Special Tax shall not be subject to escalation), or (b) in connection with any reduction in the Assigned Facilities Special Tax for Residential Property as set forth in Section C.1 herein, the amount per Acre calculated for each Planning Area pursuant to the formula below:

RAFST = AFST  ATP
These terms have the following meaning:

RAFST = the reduced Assigned Facilities Special Tax for Non-Residential Property within a Planning Area.

AFST = The total estimated Assigned Facilities Special Tax levy within such Planning Area based on the reduced Assigned Facilities Special Taxes for Developed Property permitted pursuant to Section C.1 herein which could be levied on all expected development within such Planning Area assuming Buildout of CFD No. 113.

ATP = The sum of the Acreage of all Taxable Property within a Final Subdivision (assuming Buildout of CFD No. 113) within such Planning Area (after excluding 1705
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Community Facilities District No. 113 (The Gardens Phase Two) Page 9 Public Property and Property Owner Association Property as set forth in Section E.1 herein).

Table 2
Assigned Facilities Special Tax for Non-Residential Property City of Fontana CFD No. 113 (The Gardens Phase Two)
Planning Area
Assigned
Facilities
Special Tax
P.A. 1 $59,110 per Acre
P.A. 2 $59,970 per Acre
P.A. 3 $51,370 per Acre
P.A. 4 $52,300 per Acre
(4). Backup Facilities Special Tax
The Backup Facilities Special Tax for an Assessor’s Parcel of Developed Property within a Planning Area shall equal the lesser of (a) the Backup Facilities Special Tax applicable for such Planning Area set forth in Table 3 below (as such Backup Facilities Special Tax shall not be subject to escalation), or (b) in connection with any reduction in the Assigned Facilities Special Tax as set forth in Section C.1 herein, the amount per Acre calculated for each Planning Area pursuant to the formula below:

RBFST = AFST  ATPX
These terms have the following meaning:

RBFST = the reduced Backup Facilities Special Tax for Developed Property within a Planning Area.

ATPX = The sum of the Acreage of all Taxable Property within a Final Subdivision (assuming Buildout of CFD No. 113) within such Planning Area (after excluding Public Property and Property Owner Association Property as set forth in Section E.1 herein) multiplied by 85%.

Table 3
Backup Facilities Special Tax for Developed Property
City of Fontana CFD No. 113 (The Gardens Phase Two)
Planning Area
Backup
Facilities
Special Tax
P.A. 1 $69,540 per Acre
P.A. 2 $70,560 per Acre
P.A. 3 $60,450 per Acre
P.A. 4 $61,530 per Acre
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Community Facilities District No. 113 (The Gardens Phase Two) Page 10 Furthermore, all Assessors’ Parcels within CFD No. 113 shall be relieved simultaneously and permanently from the obligation to pay and disclose the Backup Facilities Special Tax if the CFD Administrator calculates that (i) the annual debt service required for the Outstanding Bonds, when compared to the Assigned Facilities Special Tax that shall be levied against all Assessors’ Parcels of Developed Property in CFD No. 113 results in 110% debt service coverage (i.e., the Assigned Facilities Special Tax that shall be levied against all Developed Property in CFD No. 113 in each remaining Fiscal Year based on the then existing development is at least equal to the sum of (a) 1.10 times the debt service necessary to support the remaining Outstanding Bonds in each corresponding Fiscal Year, and (b) Administrative Expenses), and (ii) all authorized CFD No. 113 Bonds have already been issued or the Council has covenanted that it shall not issue any additional CFD No. 113 Bonds (except refunding bonds) to be supported by the Facilities Special Tax in CFD No. 113.
(5). Multiple Land Uses
In some instances an Assessor’s Parcel may contain both Developed Property and Undeveloped Property. In such cases, the Acreage of the Assessor’s Parcel shall be allocated between Developed Property and Undeveloped Property based on the portion of the Assessor’s Parcel for which building permits had been issued prior to May 1 of the prior Fiscal Year and the portion of the Assessor’s Parcel for which building permits had not been issued prior to May 1 of the prior Fiscal Year.

Furthermore, Developed Property may contain more than one Land Use Class. In such cases, the Acreage that is considered Developed Property shall be allocated between Residential Property and Non-Residential Property based on the amount of Acreage designated for each land use as determined by reference to the site plan approved for such Assessor's Parcel. The Maximum Facilities Special Tax that can be levied on such Assessor’s Parcel shall be the sum of the Maximum Facilities Special Tax that can be levied on each type of property located on that Assessor’s Parcel.

The CFD Administrator’s allocation to each type of property shall be final. b. Undeveloped Property, Taxable Public Property, and Taxable Property Owner Association Property
The Maximum Facilities Special Tax for each Assessor’s Parcel of Undeveloped Property, Taxable Public Property, and Taxable Property Owner Association Property within a Planning Area shall be the applicable amount for such Planning Area set forth in Table 4 below. The Maximum Facilities Special Tax for Undeveloped Property, Taxable Public Property, and Taxable Property Owner Association Property shall not be subject to escalation and shall therefore remain the same in every Fiscal Year.

Table 4
Maximum Facilities Special Tax for Undeveloped Property, Taxable Public Property and Taxable Property Owner Association Property City of Fontana CFD No. 113 (The Gardens Phase Two)
Planning Area
Maximum
Facilities
Special Tax
P.A. 1 $69,540 per Acre
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Community Facilities District No. 113 (The Gardens Phase Two) Page 11 Planning Area
Maximum
Facilities
Special Tax
P.A. 2 $70,560 per Acre
P.A. 3 $60,450 per Acre
P.A. 4 $61,530 per Acre

2. Services Special Tax
For purposes of the Services Special Tax, an Assessor(s) Parcel of Developed Property within a Final Residential Subdivision shall be assigned to Land Use Classes 1, as identified in Table 5 and Table 6 below. Non-Residential Property shall be assigned to Land Use Class 2.

Furthermore, the Services Special Tax levied against each Assessor’s Parcel within a Final Residential Subdivision shall be based on the number of residential dwelling units for which building permits have been issued or are expected to be issued for such Assessor’s Parcel, as determined by the CFD Administrator based on such Final Residential Subdivision or other available documents.
a. Maximum Services Special Tax
The Fiscal Year 2023-2024 Maximum Services Special Tax for each Land Use Class of Developed Property is shown below in Table 5.

Table 5
Maximum Services Special Tax for Developed Property
City of Fontana CFD No. 113 (The Gardens Phase Two)
Fiscal Year 2023-2024
Land
Use
Class Description
Maximum Services
Special Tax
1 Final Residential Subdivision $770 per unit
2 Non-Residential Property $11,830 per Acre
b. Assigned Services Special Tax
The Fiscal Year 2023-2024 Assigned Services Special Tax for each Land Use Class of Developed Property is shown below in Table 6.

Table 6
Assigned Services Special Tax for Developed Property
City of Fontana CFD No. 113 (The Gardens Phase Two)
Fiscal Year 2023-2024
Land
Use
Class Description
Assigned Services
Special Tax
1 Final Residential Subdivision $550 per unit
2 Non-Residential Property $8,450 per Acre
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Community Facilities District No. 113 (The Gardens Phase Two) Page 12 c. Increase in the Maximum Services Special Tax
The Maximum Services Special Tax in Table 5 above shall be applicable for Fiscal Year 2023-2024, and shall increase thereafter, commencing on July 1, 2024, and on each July 1 thereafter by an amount equal to two percent (2%) of the amount in effect for the previous Fiscal Year.
d. Increase in the Assigned Services Special Tax
The Assigned Services Special Tax in Table 6 above shall be applicable for Fiscal Year 2023-2024, and shall increase thereafter, commencing on July 1, 2024, and on each July 1 thereafter in an amount estimated to fund the Special Tax Requirement for Services for the Fiscal Year commencing on such July 1. However, in no case shall the Assigned Services Special Tax for an Assessor’s Parcel of Developed Property exceed the applicable Maximum Services Special Tax for such Assessor’s Parcel of Developed Property in any Fiscal Year.
e. Multiple Land Uses
In some instances an Assessor’s Parcel of Developed Property may contain more than one Land Use Class. In such cases, the Acreage of Developed Property shall be allocated between Residential Property and Non-Residential Property based on the amount of Acreage designated for each land use as determined by reference to the site plan approved for such Assessor's Parcel. The Maximum Services Special Tax that can be levied on such Assessor’s Parcel shall be the sum of the Maximum Services Special Tax that can be levied on each type of property located on that Assessor’s Parcel. The CFD Administrator’s allocation to each type of property shall be final.

D. METHOD OF APPORTIONMENT OF THE SPECIAL TAX

1. Facilities Special Tax
Commencing with Fiscal Year 2024-2025, and for each following Fiscal Year, the CFD Administrator shall determine the Special Tax Requirement for Facilities and shall provide for the levy of the Facilities Special Tax each Fiscal Year as follows:

First: The Facilities Special Tax shall be levied on each Assessor’s Parcel of Developed Property in an amount equal to 100% of the applicable Assigned Facilities Special Tax; Second: If additional monies are needed to satisfy the Special Tax Requirement for Facilities after the first step has been completed, the Facilities Special Tax shall be levied Proportionately on each Assessor's Parcel of Undeveloped Property at up to 100% of the Maximum Facilities Special Tax for Undeveloped Property;
Third: If additional monies are needed to satisfy the Special Tax Requirement for Facilities after the first two steps have been completed, then the levy of the Facilities Special Tax on each Assessor's Parcel of Developed Property whose Maximum Facilities Special Tax is determined through the application of the Backup Facilities Special Tax shall be increased in equal percentages from the Assigned Facilities Special Tax up to the Maximum Facilities Special Tax for each such Assessor's Parcel;
Fourth: If additional monies are needed to satisfy the Special Tax Requirement for Facilities after the first three steps have been completed, then the Facilities Special Tax shall be levied Proportionately on each Assessor’s Parcel of Taxable Public Property and Taxable Property 1709
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Community Facilities District No. 113 (The Gardens Phase Two) Page 13 Owner Association Property at up to 100% of the Maximum Facilities Special Tax for Taxable Public Property and Taxable Property Owner Association Property, as needed to satisfy the Special Tax Requirement for Facilities.

Notwithstanding the above, the CFD Administrator shall, in any Fiscal Year, calculate a levy Proportionately less than 100% of the Assigned Facilities Special Tax in step one (above), when (i) the CFD Administrator is no longer required to provide for the levy of the Facilities Special Tax pursuant to steps two through four above in order to meet the Special Tax Requirement for Facilities; and (ii) all authorized CFD No. 113 Bonds have already been issued or the Council has covenanted that it shall not issue any additional CFD No. 113 Bonds (except refunding bonds) to be supported by the Facilities Special Tax.

Further notwithstanding the above, under no circumstances shall the Facilities Special Tax levied in any Fiscal Year against any Assessor’s Parcel of Residential Property for which an occupancy permit for private residential use has been issued (in accordance with Section 53321(d)(3) of the California Government Code), be increased as a consequence of delinquency or default by the owner of any other Assessor’s Parcel within CFD No. 113 by more than ten percent above the amount that would have been levied in that Fiscal Year had there never been any such delinquencies or defaults. To the extent that the levy of the Facilities Special Tax on Residential Property is limited by the provision in the previous sentence, the levy of the Facilities Special Tax on each Assessor’s Parcel of Non-Residential Property shall continue in equal percentages up to 100% of the applicable Maximum Facilities Special Tax.

2. Services Special Tax
Commencing with Fiscal Year 2024-2025 and for each following Fiscal Year, the CFD Administrator shall determine the Special Tax Requirement for Services and shall provide for the levy of the Services Special Tax until the total Services Special Tax levy equals the Special Tax Requirement for Services. The Services Special Tax shall be levied each Fiscal Year as follows:

First: The Services Special Tax shall be levied Proportionately each Fiscal Year on each Assessor’s Parcel of Developed Property at up to 100% of the applicable Assigned Services Special Tax as needed to satisfy the Special Tax Requirement for Services; Second: If additional monies are needed to satisfy the Special Tax Requirement for Services after the first step has been completed, then the levy of the Services Special Tax on each Assessor's Parcel of Developed Property shall be increased in equal percentages from the Assigned Services Special Tax up to the Maximum Services Special Tax for each such Assessor’s Parcel.

E. EXEMPTIONS

1. Facilities Special Tax
No Facilities Special Tax shall be levied on up to the applicable Acreage limit of Public Property and/or Property Owner Association Property established for each Planning Area as set forth in Table 7 below. Tax-exempt status shall be assigned by the CFD Administrator in the chronological order in which property within a Planning Area becomes Public Property or Property Owner Association Property. However, should an Assessor’s Parcel no longer be classified as Public Property or Property Owner Association Property, it shall, from that point forward, be subject to the Facilities Special Tax.
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Community Facilities District No. 113 (The Gardens Phase Two) Page 14 Table 7
Exempt Acreage Limits
City of Fontana CFD No. 113 (The Gardens Phase Two)
Planning Area
Exempt
Acreage Limit
P.A. 1 3.36 Acres
P.A. 2 2.00 Acres
P.A. 3 2.66 Acres
P.A. 4 3.08 Acres
Notwithstanding the above, an Assessor’s Parcel within a Planning Area that is transferred to a public agency or property owner’s association prior to the issuance of the first series of CFD No. 113 Bonds that causes the Acreage of Public Property and Property Owner Association Property within such Planning Area to exceed the applicable Acreage limit that can be designated by the CFD Administrator under this Section E.1 shall also be exempted from paying the Special Tax.

Public Property or Property Owner Association Property that is not exempt from the Facilities Special Tax under this Section E.1 shall be subject to the levy of the Facilities Special Tax and shall be taxed Proportionately as part of the fourth step in Section D herein, at up to 100% of the applicable Maximum Facilities Special Tax for Taxable Public Property and Taxable Property Owner Association Property.

In addition, no Facilities Special Tax shall be levied on Lower Income Households Welfare Exemption Property, provided that if, in any Fiscal Year, applicable law does not require that an Assessor’s Parcel that is Lower Income Households Welfare Exemption Property be exempt from the Facilities Special Tax, then the Facilities Special Tax shall be levied on such Assessor’s Parcel in accordance with this Rate and Method of Apportionment as if such Assessor’s Parcel were not classified as Lower Income Households Welfare Exemption Property.

2. Services Special Tax
No Services Special Tax shall be levied on Undeveloped Property, Taxable Public Property, Taxable Property Owner Association Property, Public Property, or Property Owner Association Property.

In addition, no Services Special Tax shall be levied on Lower Income Households Welfare Exemption Property, provided that if, in any Fiscal Year, applicable law does not require that an Assessor’s Parcel that is Lower Income Households Welfare Exemption Property be exempt from the Services Special Tax, then the Services Special Tax shall be levied on such Assessor’s Parcel in accordance with this Rate and Method of Apportionment as if such Assessor’s Parcel were not classified as Lower Income Households Welfare Exemption Property.

F. MANNER OF COLLECTION
The 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. 113 may directly bill the Special Tax, and/or may collect Special Taxes at a different time or in a different manner if necessary to meet financial obligations, and, to the extent of the Facilities Special Tax, may covenant to foreclose and may actually foreclose on delinquent Assessor’s Parcels. 1711
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Community Facilities District No. 113 (The Gardens Phase Two) Page 15 G. APPEALS AND INTERPRETATIONS
Any landowner or resident who feels that the amount of the Special Tax levied on his/her Assessor’s Parcel is in error may submit a written appeal to the CFD Administrator, provided that the appellant is current in his/her payment of Special Taxes. During the pendency of an appeal, all Special Taxes previously levied must be paid on or before the payment date established when the levy was made. The CFD Administrator shall review the appeal, meet with the appellant if the CFD Administrator deems necessary, and advise the appellant of its determination. If the CFD Administrator agrees with the appellant, a cash refund shall not be made (except for the last year of levy), but the amount of the Special Tax levied shall be appropriately modified through an adjustment to the Special Tax levy in the following Fiscal Year. If the CFD Administrator disagrees with the appellant and the appellant is dissatisfied with the determination, the appellant then has 30 days in which to appeal to the Council by filing a written notice of appeal with the City Clerk, provided that the appellant is current in his/her payment of Special Taxes. This second appeal must specify the reasons for its disagreement with the CFD Administrator's determination.

The CFD Administrator shall interpret this Rate and Method of Apportionment for purposes of clarifying any ambiguity and make determinations relative to the annual administration of the Special Tax and any landowner or resident appeals. Any decision of the CFD Administrator shall be subject to appeal to the Council whose decision shall be final and binding as to all persons.

H. PREPAYMENT OF FACILITIES SPECIAL TAX
Under this Rate and Method of Apportionment, an Assessor’s Parcel within CFD No. 113 is permitted to prepay the Facilities Special Tax. The obligation of the Assessor’s Parcel to pay the Facilities Special Tax may be fully prepaid and permanently satisfied or partially prepaid as described herein, provided that a prepayment may be made only for Assessor’s Parcels of Developed Property, or for an Assessor’s Parcel of Undeveloped Property for which a building permit has been issued after January 1, 2024, and only if there are no delinquent Special Taxes with respect to such Assessor’s Parcel at the time of prepayment. An owner of an Assessor's Parcel intending to prepay the Facilities Special Tax obligation shall provide the CFD Administrator with written notice of intent to prepay. Within 30 days of receipt of such written notice, the CFD Administrator shall notify such owner of the prepayment amount for such Assessor's Parcel. The CFD Administrator may charge such owner a reasonable fee for providing this service. If there are Outstanding Bonds, prepayment must be made not less than 30 days prior to a date that notice of redemption of CFD No. 113 Bonds from the proceeds of such prepayment may be given by the Trustee pursuant to the Indenture that is specified in the report of the Facilities Special Tax Prepayment Amount (defined below).

The following additional definitions apply to this Section H:
"CFD Public Facilities Costs" means either $20,183,675 in 2024 dollars, which shall increase by the Construction Inflation Index on July 1, 2025, and on each July 1 thereafter, or such lower number as (i) shall be determined by the CFD Administrator as sufficient to provide funding for the Authorized Facilities under the authorized bonding program for CFD No. 113, or (ii) shall be determined by the Council concurrently with a covenant that it shall not issue any more CFD No. 113 Bonds (except refunding bonds) to be supported by the Facilities Special Tax levy under this Rate and Method of Apportionment.
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Community Facilities District No. 113 (The Gardens Phase Two) Page 16 "Construction Inflation Index" means the annual percentage change in the Engineering News Record Building Cost Index for the City of Los Angeles, measured as of the month of December in the calendar year which ends in the previous Fiscal Year. In the event this index ceases to be published, the Construction Inflation Index shall be another index as determined by the CFD Administrator that is reasonably comparable to the Engineering News Record Building Cost Index for the City of Los Angeles.
"Future Facilities Costs" means the CFD Public Facilities Costs minus (i) costs of Authorized Facilities previously paid from the Improvement Fund, (ii) moneys currently on deposit in the Improvement Fund available to pay costs of Authorized Facilities, and (iii) the amount the CFD Administrator reasonably expects to derive from the reinvestment of these funds. "Improvement Fund" means a fund or account specifically identified in the Indenture (or prior to the issuance of the first series of CFD No. 113 Bonds a fund or account held by the City) to hold funds which are currently available for expenditure to acquire or construct Authorized Facilities.
"Previously Issued Bonds" means, for any Fiscal Year, all Outstanding Bonds that are outstanding under the Indenture after the first interest and/or principal payment date following the current Fiscal Year.

1. Prepayment in Full
The Facilities Special Tax Prepayment Amount (defined below) shall be calculated as summarized below (capitalized terms as defined below):

Bond Redemption Amount
plus Redemption Premium
plus Future Facilities Amount
plus Defeasance Amount
plus Administrative Fees and Expenses
less Reserve Fund Credit
less Capitalized Interest Credit
Total: equals Facilities Special Tax Prepayment Amount
As of the proposed date of prepayment, the Facilities Special Tax Prepayment Amount shall be calculated according to the following paragraphs:

1. Confirm that no Special Tax delinquencies apply to such Assessor’s Parcel.

2. For Assessor’s Parcels of Developed Property, compute the Assigned Facilities Special Tax and Backup Facilities Special Tax for the Assessor’s Parcel to be prepaid. For Assessor’s Parcels of Undeveloped Property for which a building permit has been issued after January 1, 2024, compute the Assigned Facilities Special Tax and Backup Facilities Special Tax for that Assessor’s Parcel as though it was already designated as Developed Property, based upon the building permit which has already been issued for such Assessor’s Parcel.

3. (a) Divide the Assigned Facilities Special Tax computed pursuant to paragraph 2 by the total estimated Assigned Facilities Special Tax levy for CFD No. 113 based on the Assigned Facilities Special Taxes for Developed Property which could be levied on all expected development assuming Buildout of CFD No. 113, excluding any Assessor’s Parcels which have been prepaid, and
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Community Facilities District No. 113 (The Gardens Phase Two) Page 17 (b) Divide the Backup Facilities Special Tax computed pursuant to paragraph 2 by the total estimated Backup Facilities Special Taxes at Buildout for the entire CFD No. 113, excluding any Assessor’s Parcels which have been prepaid.

4. Multiply the larger quotient computed pursuant to paragraph 3(a) or 3(b) by the Previously Issued Bonds to compute the amount of Previously Issued Bonds to be redeemed (the "Bond Redemption Amount").

5. Multiply the Bond Redemption Amount computed pursuant to paragraph 4 by the applicable redemption premium (e.g., the redemption price minus 100%) set forth in the Indenture, if any, on the Previously Issued Bonds to be redeemed (the "Redemption Premium").

6. Compute the current Future Facilities Costs.

7. Multiply the larger quotient computed pursuant to paragraph 3(a) or 3(b) by the amount determined pursuant to paragraph 6 to compute the amount of Future Facilities Costs to be prepaid (the "Future Facilities Amount").

8. Compute the amount needed to pay interest on the Bond Redemption Amount from the first bond interest and/or principal payment date following the current Fiscal Year until the redemption date for the Previously Issued Bonds specified in the report of the Facilities Special Tax Prepayment Amount.

9. Determine the Facilities Special Tax levied on the Assessor’s Parcel in the current Fiscal Year which has not yet been paid.

10. Compute the minimum amount the CFD Administrator reasonably expects to derive from the reinvestment of the Facilities Special Tax Prepayment Amount, less any interest earnings attributed to the Future Facilities Amount, and less any interest earnings attributed to the Administrative Fees and Expenses (defined below) from the date of prepayment until the redemption date for the Previously Issued Bonds to be redeemed with the prepayment.

11. Add the amounts computed pursuant to paragraphs 8 and 9 and subtract the amount computed pursuant to paragraph 10 (the "Defeasance Amount").

12. The administrative fees and expenses of CFD No. 113 are as calculated by the CFD Administrator and include the costs of computation of the prepayment, the costs to invest the prepayment proceeds, the costs of redeeming CFD No. 113 Bonds, and the costs of recording any notices to evidence the prepayment and the redemption (the "Administrative Fees and Expenses").

13. The reserve fund credit (the "Reserve Fund Credit") shall equal the lesser of: (a) the expected reduction in the reserve requirement (as defined in the Indenture), if any, associated with the redemption of Previously Issued Bonds as a result of the prepayment, or (b) the amount derived by subtracting the new reserve requirement (as defined in the Indenture) in effect after the redemption of Previously Issued Bonds as a result of the prepayment from the balance in the reserve fund on the prepayment date, but in no event shall such amount be less than zero. No Reserve Fund Credit shall be granted if the amount then on deposit in the reserve fund for the Previously Issued Bonds is below 100% of the reserve requirement (as defined in the Indenture). 1714
City of Fontana March 20, 2024
Community Facilities District No. 113 (The Gardens Phase Two) Page 18

14. If any capitalized interest for the Previously Issued Bonds will not have been expended as of the date immediately following the first interest and/or principal payment following the current Fiscal Year, a capitalized interest credit shall be calculated by multiplying the larger quotient computed pursuant to paragraph 3(a) or 3(b) by the expected balance in the capitalized interest fund or account under the Indenture after such first interest and/or principal payment date (the "Capitalized Interest Credit").

15. The Facilities Special Tax prepayment is equal to the sum of the amounts computed pursuant to paragraphs 4, 5, 7, 11 and 12, less the amounts computed pursuant to paragraphs 13 and 14 (the "Facilities Special Tax Prepayment Amount").

2. Prepayment in Part
The amount of the prepayment shall be calculated as in Section H.1; except that a partial prepayment shall be calculated according to the following formula:

PP = [(PE – A) x F] + A
These terms have the following meaning:

PP = the partial prepayment.

PE = the Facilities Special Tax Prepayment Amount calculated according to Section H.1.

F = the percentage, expressed as a decimal, by which the owner of the Assessor’s Parcel is partially prepaying the Facilities Special Tax.

A = the Administrative Fees and Expenses calculated according to Section H.1.

3. General Provisions Applicable to the Prepayment of Facilities Special Tax (a). Use of the Facilities Special Tax Prepayment Amount The Facilities Special Tax Prepayment Amount, less the Administrative Fees and Expenses calculated according to Section H.1 which shall be retained by CFD No. 113, and less the Future Facilities Amount calculated according to Section H.1 which shall be deposited into the Improvement Fund, shall be deposited into specific funds established under the Indenture, to fully or partially redeem as many Outstanding Bonds as possible, and, if amounts are less than $5,000, to make debt service payments on the Outstanding Bonds.
(b). Full Prepayment of Facilities Special Tax
Upon confirmation of the payment of the current Fiscal Year’s entire Facilities Special Tax obligation, the CFD Administrator shall remove the current Fiscal Year’s Facilities Special Tax levy for such Assessor’s Parcel from the County tax rolls. With respect to any Assessor’s Parcel that is prepaid in accordance with Section H.1, the CFD Administrator shall cause a suitable notice to be recorded in compliance with the Act, to indicate the prepayment of the Facilities Special Tax and the release of the Facilities Special Tax lien on such Assessor’s Parcel, and the obligation of such Assessor’s Parcel to pay the Facilities Special Tax shall cease.
(c). Partial Prepayment of Facilities Special Tax
With respect to any Assessor’s Parcel that is partially prepaid, the CFD Administrator shall (i) distribute or cause to be distributed the funds remitted to it according to Section H.3.(a) and (ii) indicate in the records of CFD No. 113 that there has been a partial 1715
City of Fontana March 20, 2024
Community Facilities District No. 113 (The Gardens Phase Two) Page 19 prepayment of the Facilities Special Tax and that a portion of the Facilities Special Tax with respect to such Assessor’s parcel, equal to the outstanding percentage (1.00 – F) of the remaining Maximum Facilities Special Tax, shall continue to be levied on such Assessor’s Parcel pursuant to Section D herein.
(d). Debt Service Coverage
Notwithstanding the foregoing, no prepayment of the Facilities Special Tax shall be allowed unless the amount of Facilities Special Tax that may be levied on Taxable Property (assuming Buildout) within CFD No. 113 in each future Fiscal Year (after excluding Public Property and Property Owner Association Property as set forth in Section E.1 herein), after the proposed prepayment, is at least equal to the sum of (i) 1.10 times the debt service necessary to support the remaining Outstanding Bonds in each corresponding Fiscal Year, and (ii) Administrative Expenses.

I. TERM OF SPECIAL TAX
The Facilities Special Tax shall be levied for a period not to exceed fifty years commencing with Fiscal Year 2024-2025. The Services Special Tax shall be levied in perpetuity to fund the Special Tax Requirement for Services.

T/Clients/FONTANA/MELLO/CFD Nos. 113 (The Gardens Phase Two)/Rate and Method/Fontana CFD No. 113 (The Gardens Phase Two) RMA for ROI.docx 1716
A-1

EXHIBIT A

CERTIFICATE TO AMEND FACILITIES SPECIAL TAX
CFD NO. 113 CERTIFICATE

1. Pursuant to Section C.1 of the Rate and Method of Apportionment (the "Rate and Method") for City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) ("CFD No. 113"), the Assigned Facilities Special Tax and the Backup Facilities Special Tax for Developed Property within CFD No. 113 has been reduced as described herein. (a) The information in Table 1 of the Rate and Method relating to the Assigned Facilities Special Tax for Residential Property within CFD No. 113 shall be modified as follows:

Land
Use
Class
Planning
Area Description
Residential Floor
Area (square feet)
Original
Assigned
Facilities
Special Tax
Modified
Assigned
Facilities
Special Tax
1 Planning
Area 1
Residential Property 2,100 or greater $4,137 per unit $[____] per unit 2 Residential Property 1,950 to less than 2,100 $3,956 per unit $[____] per unit 3 Residential Property 1,800 to less than 1,950 $3,775 per unit $[____] per unit 4 Residential Property 1,650 to less than 1,800 $3,554 per unit $[____] per unit 5 Residential Property Less than 1,650 $3,344 per unit $[____] per unit 6 Planning
Area 2
Residential Property 2,100 or greater $3,946 per unit $[____] per unit 7 Residential Property 1,950 to less than 2,100 $3,759 per unit $[____] per unit 8 Residential Property 1,800 to less than 1,950 $3,572 per unit $[____] per unit 9 Residential Property 1,650 to less than 1,800 $3,385 per unit $[____] per unit 10 Residential Property Less than 1,650 $3,198 per unit $[____] per unit 11 Planning
Areas
3 & 4
Residential Property 2,225 or greater $4,604 per unit $[____] per unit 12 Residential Property 2,075 to less than 2,225 $4,259 per unit $[____] per unit 13 Residential Property 1,925 to less than 2,075 $3,914 per unit $[____] per unit 14 Residential Property 1,775 to less than 1,925 $3,699 per unit $[____] per unit 15 Residential Property Less than 1,775 $3,549 per unit $[____] per unit (b) The Assigned Facilities Special Tax for Non-Residential Property within a Planning Area, set forth in Table 2 within Section C.1.a.(3) of the Rate and Method, shall be modified as follows:

Planning
Area
Original
Assigned
Facilities
Special Tax
Modified
Assigned
Facilities
Special Tax
P.A. 1 $59,110 per Acre $[____] per Acre
P.A. 2 $59,970 per Acre $[____] per Acre
P.A. 3 $51,370 per Acre $[____] per Acre
P.A. 4 $52,300 per Acre $[____] per Acre
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(c) The Backup Facilities Special Tax for Developed Property within a Planning Area, set forth in Table 3 within Section C.1.a.(4) of the Rate and Method, shall be modified as follows:

Planning
Area
Original
Backup
Facilities
Special Tax
Modified
Backup
Facilities
Special Tax
P.A. 1 $69,540 per Acre $[____] per Acre
P.A. 2 $70,560 per Acre $[____] per Acre
P.A. 3 $60,450 per Acre $[____] per Acre
P.A. 4 $61,530 per Acre $[____] per Acre

2. The Assigned Facilities Special Tax and the Backup Facilities Special Tax for Developed Property may only be reduced prior to the first issuance of CFD No. 113 Bonds.

3. Upon execution of the certificate by CFD No. 113, CFD No. 113 shall cause an amended notice of Special Tax lien for CFD No. 113 to be recorded reflecting the reductions set forth herein.

All capitalized terms used herein shall have the meanings set forth in the Rate and Method.

By:___________________________ Date:______________________ CFD Administrator
By execution hereof, the undersigned acknowledge, on behalf of CFD No. 113, receipt of this certificate and modification of the Rate and Method as set forth in this certificate.

CITY OF FONTANA COMMUNITY FACILITIES DISTRICT NO. 113
(THE GARDENS PHASE TWO)
By:___________________________ Date:______________________ 1718
B

EXHIBIT B

PLANNING AREAS
Planning Area (P.A.) Legal Description
Planning Area 1 Lot 1 of Tract No. 20362
Planning Area 2 Lot 2 of Tract No. 20362
Planning Area 3 Lot 3 of Tract No. 20362
Planning Area 4 Lot 4 of Tract No. 20362
Reference is hereby made to Tract No. 20362 filed in Book 362 of Tract Maps at Pages 78 through 84 in the Office of the San Bernardino County Recorder (recorded as Document No. 2022- 0129505), Tract No. 20363 filed in Book 363 of Tract Maps at Pages 58 through 66 in the Office of the San Bernardino County Recorder (recorded as Document No. 2022-0259528), and Tract No. 20364 filed in Book 363 of Tract Maps at Pages 67 through 71 in the Office of the San Bernardino County Recorder (recorded as Document No. 2022-0259529) for a description of the lines and dimensions of the tracts and lots listed above.
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I, Germaine Key, City Clerk of the City of Fontana, California, and Ex-Officio Clerk of the City Council, do hereby certify that the foregoing Resolution is the actual Resolution duly and regularly adopted by the City Council of said City at a regular meeting thereof, held on May 14, 2024, by the following vote to-wit:

AYES:

NOES:

ABSENT:

City Clerk
Mayor
ATTEST:

City Clerk
1720
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RESOLUTION NO. _____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY

OF FONTANA DEEMING IT NECESSARY FOR CITY OF
FONTANA COMMUNITY FACILITIES DISTRICT NO. 113
(THE GARDENS PHASE TWO) TO INCUR BONDED

INDEBTEDNESS
WHEREAS, on April 9, 2024, the City Council (the “City Council”) of the City of Fontana (the “City”), pursuant to the Mello-Roos Community Facilities Act of 1982 (the “Act”), adopted a resolution entitled “A Resolution of the City Council of the City of Fontana of Intention to Establish a Community Facilities District Proposed to be Named City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) and to Authorize the Levy of a Special Tax Therein,” stating its intention to establish City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) (the “Community Facilities District”) and to authorize the Community Facilities District to levy a special tax (the “Special Tax”) within the Community Facilities District for the purpose of financing certain public facilities (the “Facilities”) and services; WHEREAS, on April 9, 2024, the City Council also adopted a resolution entitled “A Resolution of the City Council of the City of Fontana Declaring it Necessary for City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) to Incur Bonded Indebtedness” (the “Resolution Declaring Necessity”), declaring it necessary for the Community Facilities District to incur bonded indebtedness and setting the date for a public hearing to be held on the proposed debt authorization;
WHEREAS, pursuant to the Resolution Declaring Necessity, notice of said public hearing was published in the Fontana Herald News, a newspaper of general circulation published in the area of the Community Facilities District, in accordance with the Act; WHEREAS, on this date, the City Council opened, conducted and closed said public hearing;
WHEREAS, at said public hearing, any person interested, including persons owning property within the area and desiring to appear and present any matters material to the questions set forth in the Resolution Declaring Necessity appeared and presented such matters; WHEREAS, oral or written protests against the proposed debt issue were not made or filed at or before said public hearing by 50% or more of the registered voters, or six registered voters, whichever is more, residing within the territory proposed to be included in the Community Facilities District, or the owners of one-half or more of the area of land in the territory proposed to be included in the Community Facilities District and not exempt from the Special Tax; WHEREAS, the City Council deems it necessary for the Community Facilities District to incur bonded indebtedness;
WHEREAS, on this date, the City Council adopted a resolution entitled “A Resolution of the City Council of the City of Fontana of Formation of City of Fontana Community Facilities District No. 113 (The Gardens Phase Two), Proposing that the Community Facilities District Be 1721
2 4133-2209-2366.2
Authorized to Levy a Special Tax and Proposing that an Appropriations Limit of the Community Facilities District Be Established;”
WHEREAS, the City Clerk of the City (the “City Clerk”) is the election official that will conduct the special election on the proposition to authorize the Community Facilities District to incur bonded indebtedness;
WHEREAS, there has been filed with the City Clerk a letter from the Registrar of Voters of the County of San Bernardino indicating that no persons were registered to vote within the territory of the Community Facilities District as of April 19, 2024, which demonstrates that 12 or more persons have not been registered to vote within the territory of the Community Facilities District for each of the 90 days preceding the close of said public hearing; WHEREAS, there has been filed with the City Clerk consents and waivers of all of the landowners of record in the Community Facilities District consenting to the waiver of, and waiving, any time limit specified by Section 53326 of the Act and any requirement pertaining to the conduct of said special election, including any time limit or requirement applicable to an election pursuant to Article 5 of the Act (commencing with Section 53345 of the Act), consenting to the holding of said special election on May 14, 2024, and consenting to the waiver of, and waiving, any impartial analysis, arguments or rebuttals, as set forth in Sections 53326 and 53327 of the Act; and
WHEREAS, the City Clerk has concurred in said waivers and has concurred in holding said special election on May 14, 2024;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Fontana as follows:

Section 1. The foregoing recitals are true and correct, and the City Council so finds and determines.

Section 2. The City Council deems it necessary for the Community Facilities District to incur the bonded indebtedness.

Section 3. The bonded indebtedness will be incurred for the purpose of financing the costs of the Facilities, including all costs and estimated costs incidental to, or connected with, the accomplishment of said purpose, including, but not limited to, such costs and estimated costs as are described in Section 53345.3 of the Act.

Section 4. In accordance with the previous determination of the City Council, the whole of the Community Facilities District will pay for the bonded indebtedness.

Section 5. The maximum amount of debt to be incurred is $24,000,000.

Section 6. The maximum term the bonds to be issued shall run before maturity is 40 years.

Section 7. The maximum annual rate of interest to be paid shall not exceed the maximum interest rate permitted by applicable law at the time of sale of the bonds, payable semiannually or 1722
3 4133-2209-2366.2
at such times as the City Council or its designee shall determine, the actual rate or rates and times of payment of such interest to be determined by the City Council or its designee at the time or times of sale of the bonds.

Section 8. The proposition to authorize the Community Facilities District to incur the bonded indebtedness shall be submitted to the qualified electors of the Community Facilities District.

Section 9. The City Council hereby finds and determines that no persons were registered to vote within the territory of the Community Facilities District as of April 19, 2024, and that 12 or more persons have not been registered to vote within the territory of the Community Facilities District for each of the 90 days preceding the close of the public hearing held by the City Council on the proposed debt issue for the Community Facilities District. Accordingly, pursuant to Section 53326 of the Act, the vote shall be by the landowners of the Community Facilities District and each person who is the owner of land as of the close of said public hearing, or the authorized representative thereof, shall have one vote for each acre or portion of an acre that he or she owns within the Community Facilities District not exempt from the Special Tax.

Section 10. The City Council hereby finds and determines that the qualified electors of the Community Facilities District have (a) unanimously consented to the waiver of, and have waived, any time limit specified by Section 53326 of the Act and any requirement pertaining to the conduct of said election, including any time limit or requirement applicable to an election pursuant to Article 5 of the Act (commencing with Section 53345 of the Act), (b) unanimously consented to the holding of said election on May 14, 2024, and (c) unanimously consented to the waiver of, and have waived, any impartial analysis, arguments or rebuttals, as set forth in Sections 53326 and 53327 of the Act. The City Council hereby finds and determines that the City Clerk has concurred in said waivers and has concurred in holding said election on May 14, 2024.

Section 11. The date of the special community facilities district election (which shall be consolidated with the special district election to authorize the Community Facilities District to levy the Special Tax) at which time the proposition to authorize the Community Facilities District to incur the bonded indebtedness shall be submitted to the voters is May 14, 2024.

Section 12. As authorized by Section 53353.5 of the Act, the propositions to authorize the Community Facilities District to incur such bonded indebtedness, to authorize the Community Facilities to levy the Special Tax and to establish an appropriations limit of the Community Facilities District shall be combined into one ballot proposition.

Section 13. Pursuant to Section 53326 of the Act, the election shall be conducted by mail or hand-delivered ballot. The voted ballots are required to be received in the office of the City Clerk no later than 8:30 p.m. on May 14, 2024; provided, however, that if all of the qualified electors have voted prior to such time, the election may be closed with the concurrence of the City Clerk.

Section 14. All actions heretofore taken by the officers, employees and agents of the City with respect to the incurrence of bonded indebtedness by the Community Facilities District, or in 1723
4 4133-2209-2366.2
connection with or related to any of the matters referred to herein, are hereby approved, confirmed and ratified.

Section 15. The officers, employees and agents of the City are hereby authorized and directed to take all actions and do all things that they, or any of them, may deem necessary or desirable to accomplish the purposes of this Resolution and not inconsistent with the provisions hereof.

Section 16. This Resolution shall take effect immediately upon its adoption.

APPROVED and ADOPTED by the City Council of the City of Fontana on May 14, 2024.

READ AND APPROVED AS TO LEGAL FORM:

City Attorney
1724
5 4133-2209-2366.2
I, Germaine Key, City Clerk of the City of Fontana, California, and Ex-Officio Clerk of the City Council, do hereby certify that the foregoing Resolution is the actual Resolution duly and regularly adopted by the City Council of said City at a regular meeting thereof, held on May 14, 2024, by the following vote to-wit:

AYES:

NOES:

ABSENT:

City Clerk
Mayor
ATTEST:

City Clerk
1725
4132-0471-7390.1
RESOLUTION NO. _____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY

OF FONTANA CALLING SPECIAL ELECTION FOR CITY

OF FONTANA COMMUNITY FACILITIES DISTRICT
NO. 113 (THE GARDENS PHASE TWO)
WHEREAS, on this date, the City Council (the “City Council”) of the City of Fontana (the “City”), pursuant to the Mello-Roos Community Facilities Act of 1982 (the “Act”), adopted a resolution entitled “A Resolution of the City Council of the City of Fontana of Formation of City of Fontana Community Facilities District No. 113 (The Gardens Phase Two), Proposing that the Community Facilities District Be Authorized to Levy a Special Tax and Proposing that an Appropriations Limit of the Community Facilities District Be Established” (the “Resolution of Formation”), establishing City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) (the “Community Facilities District”), proposing that the Community Facilities District be authorized to levy a special tax (the “Special Tax”) within the Community Facilities District for the purpose of financing certain public facilities (the “Facilities”) and services and proposing that an appropriations limit of the Community Facilities District be established at $24,000,000;
WHEREAS, on this date, the City Council also adopted a resolution entitled “A Resolution of the City Council of the City of Fontana Deeming it Necessary for City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) to Incur Bonded Indebtedness” (the “Resolution Deeming Necessity”), deeming it necessary for the Community Facilities District to incur bonded indebtedness in a maximum amount of $24,000,000; WHEREAS, pursuant to the provisions of the Act and said resolutions, the propositions to authorize the Community Facilities District to incur such bonded indebtedness, to authorize the Community Facilities District to levy the Special Tax and to establish such appropriations limit of the Community Facilities District are to be submitted to the qualified electors of the Community Facilities District at a special election;
WHEREAS, the City Council desires to designate the City Clerk of the City (the “City Clerk”) as the election official for such special election; WHEREAS, there has been filed with the City Clerk a letter from the Registrar of Voters of the County of San Bernardino indicating that no persons were registered to vote within the territory of the Community Facilities District as of April 19, 2024, which demonstrates that 12 or more persons have not been registered to vote within the territory of the Community Facilities District for each of the 90 days preceding the close of the public hearings on the establishment of the Community Facilities District and the proposed debt issue for the Community Facilities District;
WHEREAS, there has been filed with the City Clerk consents and waivers of all of the landowners of record in the Community Facilities District consenting to the waiver of, and waiving, any time limit specified by Section 53326 of the Act and any requirement pertaining to the conduct of said special election, including any time limit or requirement applicable to an 1726
2 4132-0471-7390.1
election pursuant to Article 5 of the Act (commencing with Section 53345 of the Act), consenting to the holding of said special election on May 14, 2024 and consenting to the waiver of, and waiving, any impartial analysis, arguments or rebuttals, as set forth in Sections 53326 and 53327 of the Act; and
WHEREAS, the City Clerk has concurred in said waivers and has concurred in holding said special election on May 14, 2024;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Fontana as follows:

Section 1. The foregoing recitals are true and correct, and the City Council so finds and determines.

Section 2. Pursuant to Sections 53351, 53326 and 53325.7 of the Act, the propositions to authorize the Community Facilities District to incur bonded indebtedness, to authorize the Community Facilities District to levy the Special Tax and to establish the appropriations limit of the Community Facilities District shall be submitted to the qualified electors of the Community Facilities District at an election called therefor as provided below.

Section 3. The City Clerk is hereby designated as the official to conduct said election.

Section 4. As authorized by Section 53353.5 of the Act, the propositions to authorize the Community Facilities District to incur such bonded indebtedness, to authorize the Community Facilities District to levy the Special Tax and to establish such appropriations limit of the Community Facilities District shall be combined into one ballot proposition.

Section 5. The City Council hereby finds and determines that no persons were registered to vote within the territory of the Community Facilities District as of April 19, 2024, and that 12 or more persons have not been registered to vote within the territory of the Community Facilities District for each of the 90 days preceding the close of the public hearings heretofore held by the City Council on the establishment of the Community Facilities District and the proposed debt issue for the Community Facilities District. Accordingly, pursuant to Section 53326 of the Act, the vote shall be by the landowners of the Community Facilities District and each person who is the owner of land as of the close of said public hearings, or the authorized representative thereof, shall have one vote for each acre or portion of an acre that he or she owns within the Community Facilities District not exempt from the Special Tax.

Section 6. The City Council hereby finds and determines that the qualified electors of the Community Facilities District have (a) unanimously consented to the waiver of, and have waived, any time limit specified by Section 53326 of the Act and any requirement pertaining to the conduct of said election, including any time limit or requirement applicable to an election pursuant to Article 5 of the Act (commencing with Section 53345 of the Act), (b) unanimously consented to the holding of said election on May 14, 2024, and (c) unanimously consented to the waiver of, and have waived, any impartial analysis, arguments or rebuttals, as set forth in Sections 53326 and 53327 of the Act. The City Council hereby finds and determines that the City Clerk has concurred in said waivers and has concurred in holding said election on May 14, 2024. 1727
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Section 7. The City Council hereby calls a special election to submit to the qualified electors of the Community Facilities District the combined ballot proposition to authorize the Community Facilities District to incur bonded indebtednessin a maximum amount of $24,000,000, to authorize the Community Facilities to levy the Special Tax and to establish the appropriations limit of the Community Facilities District at $24,000,000, which election shall be held at 8353 Sierra Avenue, Fontana, California, on May 14, 2024, provided, that, in the event the May 14, 2024 City Council meeting is held via teleconference and/or videoconference only, the means by which the public may observe such public hearings and offer public comment would be as prescribed in the notice and agenda for such City Council meeting. The City Council has caused to be provided to the City Clerk, as the official to conduct the election, the Resolution of Formation, the Resolution Deeming Necessity, a certified map of sufficient scale and clarity to show the boundaries of the Community Facilities District and a sufficient description to allow the City Clerk to determine the boundaries of the Community Facilities District.

The voted ballots shall be returned to the City Clerk not later than 8:30 p.m. on May 14, 2024; provided, however, that if all of the qualified electors have voted prior to such time, the election may be closed with the concurrence of the City Clerk.

Section 8. Pursuant to Section 53326 of the Act, the election shall be conducted by mail or hand-delivered ballot pursuant to Section 4000 et. seq. of the California Elections Code. Except as otherwise provided in the Act, the provisions of law regulating elections of the City, insofar as they may be applicable, shall govern the election.

Section 9. The form of the ballot for the election, which sets forth the measure to be submitted to the voters, is attached hereto as Exhibit A and by this reference incorporated herein, and such form of ballot is hereby approved. The City Clerk shall cause to be delivered to each of the qualified electors of the Community Facilities District a ballot in said form, together with all supplies and written instructions necessary for the use and return of the ballot. The number of votes to be voted by a particular landowner shall be specified on the ballot provided to that landowner.

The identification envelope for return of a ballot shall be enclosed with such ballot, shall have the return postage prepaid, and shall contain: (a) the name and address of the landowner, (b) a declaration, under penalty of perjury, stating that the voter is the owner of record or the authorized representative of the landowner entitled to vote and is the person whose name appears on the identification envelope, (c) the printed name and signature of the voter, (d) the date of signing and place of execution of the declaration described in clause (b) above, and (e) a notice that the envelope contains an official ballot and is to be opened only by the canvassing board.

Analysis and arguments with respect to the measure submitted to the voters are hereby waived, as provided in Section 53327 of the Act.

Section 10. The City Clerk shall accept the ballots of the qualified electors in the office of the City Clerk at 8353 Sierra Avenue, Fontana, California, to and including 8:30 p.m. on May 14, 2024, whether said ballots be personally delivered or received by mail. The City Clerk shall have available ballots that may be marked at said location on the election day by said qualified electors. 1728
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Section 11. The City Council hereby determines that the facilities and services financed by the Community Facilities District are necessary to meet increased demands placed upon local agencies as a result of development occurring in the Community Facilities District.

Section 12. The specific purpose of the bonded indebtedness that the Community Facilities District is proposed to be authorized to incur is the financing of the Facilities, including all costs and estimated costs incidental to, or connected with, the accomplishment of such purpose, and the proceeds of such bonded indebtedness shall be applied only to such specific purpose.

Upon approval of the proposition to authorize the Community Facilities District to incur bonded indebtedness, and the sale of any bonds evidencing such indebtedness, the City Council shall take such action as may be necessary to cause to be established an account for deposit of the proceeds of sale of the bonds. For so long as any proceeds of the bonds remain unexpended, the Chief Financial Officer, Finance Department, of the City shall cause to be filed with the City Council, no later than January 1 of each year, a report stating (a) the amount of bond proceeds received and expended during the preceding year, and (b) the status of any project funded or to be funded from bond proceeds. Said report may relate to the calendar year, fiscal year or other appropriate annual period, as the Chief Financial Officer, Finance Department, of the City shall determine, and may be incorporated into the annual budget, audit or other appropriate routine report to the City Council.

Section 13. All actions heretofore taken by the officers, employees and agents of the City with respect to the special election called pursuant hereto, or in connection with or related to any of the matters referred to herein, are hereby approved, confirmed and ratified.

Section 14. The officers, employees and agents of the City are hereby authorized and directed to take all actions and do all things that they, or any of them, may deem necessary or desirable to accomplish the purposes of this Resolution and not inconsistent with the provisions hereof.

Section 15. This Resolution shall take effect immediately upon its adoption.

APPROVED and ADOPTED by the City Council of the City of Fontana on May 14, 2024.

READ AND APPROVED AS TO LEGAL FORM:

City Attorney
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4132-0471-7390.1

EXHIBIT A

OFFICIAL BALLOT

CITY OF FONTANA
May 14, 2024

SPECIAL ELECTION
This ballot is for a special, landowner election. The number of votes to be voted pursuant to this ballot is ___.

INSTRUCTIONS TO VOTERS:

To vote on the measure, mark a cross (+ or X) in the voting square after the word “YES” or after the word “NO”. All distinguishing marks or erasures are forbidden and make the ballot void. If you wrongly mark, tear or deface this ballot, return it to the City Clerk of the City of Fontana and obtain another.

CITY OF FONTANA
COMMUNITY FACILITIES DISTRICT NO. 113
(THE GARDENS PHASE TWO)
MEASURE: Shall the measure to authorize City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) (the “Community Facilities District”) to incur bonded indebtedness in a maximum amount of $24,000,000, to authorize the Community Facilities District to levy a special tax in order to finance certain facilities and services and to establish the annual appropriations limit of the Community Facilities District at $24,000,000, as specified in the resolutions adopted by the City Council of the City of Fontana on May 14, 2024 entitled “A Resolution of the City Council of the City of Fontana of Formation of City of Fontana Community Facilities District No. 113 (The Gardens Phase Two), Proposing that the Community Facilities District Be Authorized to Levy a Special Tax and Proposing that an Appropriations Limit of the Community Facilities District Be Established” and “A Resolution of the City Council of the City of Fontana Deeming it Necessary for City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) to Incur Bonded Indebtedness,” be adopted?
Yes:

No:
1730
4132-0471-7390.1
I, Germaine Key, City Clerk of the City of Fontana, California, and Ex-Officio Clerk of the City Council, do hereby certify that the foregoing Resolution is the actual Resolution duly and regularly adopted by the City Council of said City at a regular meeting thereof, held on May 14, 2024, by the following vote to-wit:

AYES:

NOES:

ABSENT:

City Clerk
Mayor
ATTEST:

City Clerk
1731
4135-0670-7278.1
RESOLUTION NO. _____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY

OF FONTANA DECLARING RESULTS OF SPECIAL

ELECTION AND DIRECTING RECORDING OF NOTICE

OF SPECIAL TAX LIEN
WHEREAS, on May 14, 2024, the City Council (the “City Council”) of the City of Fontana (the “City”), pursuant to the Mello-Roos Community Facilities Act of 1982 (the “Act”), adopted a resolution entitled “A Resolution of the City Council of the City of Fontana Calling Special Election for City of Fontana Community Facilities District No. 113 (The Gardens Phase Two)” (the “Resolution Calling Election”), calling a special election to submit to the qualified electors of City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) (the “Community Facilities District”) the combined ballot proposition to authorize the Community Facilities District to incur bonded indebtedness, to authorize the Community Facilities District to levy a special tax and to establish the appropriations limit of the Community Facilities District; WHEREAS, pursuant to the terms of the Resolution Calling Election and the provisions of the Act, the special election was held on May 14, 2024; and WHEREAS, the City Clerk of the City (the “City Clerk”) has certified the canvass of the returns of the election and has filed a Canvass and Statement of Results of Election (the “Canvass”), a copy of which is attached hereto as Exhibit A;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Fontana as follows:

Section 1. The foregoing recitals are true and correct, and the City Council so finds and determines.

Section 2. The City Council has received, reviewed and hereby accepts the Canvass.

Section 3. The City Council hereby finds and declares that the ballot proposition submitted to the qualified electors of the Community Facilities District pursuant to the Resolution Calling Election has been passed and approved by such electors in accordance with Section 53355, Section 53328 and Section 53325.7 of the Act.

Section 4. The City Clerk is hereby directed to execute and cause to be recorded in the office of the County Recorder of the County of San Bernardino a notice of special tax lien in the form required by the Act, said recording to occur no later than 15 days following adoption by the City Council of this Resolution.

Section 5. All actions heretofore taken by the officers, employees and agents of the City with respect to the special election, or in connection with or related to any of the matters referred to herein, are hereby approved, confirmed and ratified.

Section 6. The officers, employees and agents of the City are hereby authorized and directed to take all actions and do all things that they, or any of them, may deem necessary or 1732
2 4135-0670-7278.1
desirable to accomplish the purposes of this Resolution and not inconsistent with the provisions hereof.

Section 7. This Resolution shall take effect immediately upon its adoption.

APPROVED and ADOPTED by the City Council of the City of Fontana on May 14, 2024.

READ AND APPROVED AS TO LEGAL FORM:

City Attorney
1733
A-1
4135-0670-7278.1

EXHIBIT A
[See attached]
1734
A-2
4135-0670-7278.1

CITY OF FONTANA
COMMUNITY FACILITIES DISTRICT NO. 113
(THE GARDENS PHASE TWO)

CANVASS AND STATEMENT OF RESULTS OF ELECTION
I hereby certify that on May 14, 2024, I canvassed the returns of the special election for City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) held on May 14, 2024, that the total number of ballots cast in said Community Facilities District and the total number of votes cast for and against the combined ballot proposition submitted to the qualified electors of the Community Facilities District are as follows and that the totals as shown for and against such proposition are true and correct:

Qualified
Landowner
Votes
Votes
Cast YES NO
City of Fontana Community Facilities
District No. 113 (The Gardens Phase
Two) Special Election, May 14, 2024
37 ____ ____ ____
MEASURE: Shall the measure to authorize City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) (the “Community Facilities District”) to incur bonded indebtedness in a maximum amount of $24,000,000, to authorize the Community Facilities District to levy a special tax in order to finance certain facilities and services and to establish the annual appropriations limit of the Community Facilities District at $24,000,000, as specified in the resolutions adopted by the City Council of the City of Fontana on May 14, 2024 entitled “A Resolution of the City Council of the City of Fontana of Formation of City of Fontana Community Facilities District No. 113 (The Gardens Phase Two), Proposing that the Community Facilities District Be Authorized to Levy a Special Tax and Proposing that an Appropriations Limit of the Community Facilities District Be Established” and “A Resolution of the City Council of the City of Fontana Deeming it Necessary for City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) to Incur Bonded Indebtedness,” be adopted? IN WITNESS WHEREOF, I HAVE HEREUNTO SET MY HAND this 14th day of May 2024.

By:

Germaine Key, City Clerk
1735
4135-0670-7278.1
I, Germaine Key, City Clerk of the City of Fontana, California, and Ex-Officio Clerk of the City Council, do hereby certify that the foregoing Resolution is the actual Resolution duly and regularly adopted by the City Council of said City at a regular meeting thereof, held on May 14, 2024, by the following vote to-wit:

AYES:

NOES:

ABSENT:

City Clerk
Mayor
ATTEST:

City Clerk
1736
4141-6101-8702.1
ORDINANCE NO. _____

AN ORDINANCE OF THE CITY OF FONTANA LEVYING A

SPECIAL TAX WITHIN CITY OF FONTANA COMMUNITY
FACILITIES DISTRICT NO. 113 (THE GARDENS PHASE
TWO)
WHEREAS, on April 9, 2024, the City Council (the “City Council”) of the City of Fontana (the “City”), pursuant to the Mello-Roos Community Facilities Act of 1982 (the “Act”), adopted a resolution entitled “A Resolution of the City Council of the City of Fontana of Intention to Establish a Community Facilities District Proposed to be Named City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) and to Authorize the Levy of a Special Tax Therein,” stating its intention to establish City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) (the “Community Facilities District”), to authorize the Community Facilities District to levy a special tax (the “Special Tax”) within the Community Facilities District for the purpose of financing certain public facilities (the “Facilities”) and services (the “Services”); WHEREAS, on May 14, 2024, the City Council held a noticed public hearing on the establishment of the Community Facilities District, as required by the Act; WHEREAS, subsequent to the close of said hearing, the City Council adopted resolutions entitled “A Resolution of the City Council of the City of Fontana of Formation of City of Fontana Community Facilities District No. 113 (The Gardens Phase Two), Proposing that the Community Facilities District Be Authorized to Levy a Special Tax and Proposing that an Appropriations Limit of the Community Facilities District Be Established” (the “Resolution of Formation”), “A Resolution of the City Council of the City of Fontana Deeming it Necessary for City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) to Incur Bonded Indebtedness” and “A Resolution of the City Council of the City of Fontana Calling Special Election for City of Fontana Community Facilities District No. 113 (The Gardens Phase Two),” which resolutions established the Community Facilities District, proposed that the Community Facilities District be authorized to levy the Special Tax within the Community Facilities District and called a special election to submit to the qualified electors of the Community Facilities District the combined ballot proposition to authorize the Community Facilities District to incur bonded indebtedness, to authorize the Community Facilities District to levy the Special Tax and to establish the appropriations limit of the Community Facilities District; WHEREAS, on May 14, 2024, an election was held in which the qualified electors of the Community Facilities District approved said proposition by more than the two-thirds vote required by the Act; and
WHEREAS, the City Council is the legislative body of the Community Facilities District;

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

Section 1. The City Council hereby authorizes and levies the Special Tax within the Community Facilities District pursuant to Sections 53328 and 53340 of the Act, at the rate and in 1737
2 4141-6101-8702.1
accordance with the method of apportionment set forth in Exhibit B to the Resolution of Formation (the “Rate and Method”). The Special Tax is hereby levied commencing in fiscal year 2024-25 and in each fiscal year thereafter until the last fiscal year in which the Special Tax is authorized to be levied pursuant to the Rate and Method.

Section 2. The City Council may, pursuant to subdivision (b) of Section 53340 of the Act, provide, by resolution, for the levy of the Special Tax in the current tax year or in future tax years at the same rate or at a lower rate than the rate provided by this Ordinance. In no event shall the Special Tax be levied on any parcel within the Community Facilities District in excess of the maximum tax specified therefor in the Rate and Method.

Section 3. The Special Tax shall be levied on all of the parcels in the Community Facilities District, unless exempted by law or by the Rate and Method.

Section 4. The proceeds of the Special Tax shall only be used to pay, in whole or in part, the cost of providing the Facilities and Services and incidental expenses pursuant to the Act.

Section 5. The Special Tax shall be collected in the same manner as ordinary ad valorem property taxes are collected and shall be subject to the same penalties and the same procedure, sale and lien priority in the case of delinquency as is provided for ad valorem taxes or in such other manner as the City Council shall determine, including direct billing of the affected property owners.

Section 6. If for any reason any portion of this Ordinance is found to be invalid, or if the Special Tax is found inapplicable to any particular parcel within the Community Facilities District, by a court of competent jurisdiction, the balance of this Ordinance and the application of the Special Tax to the remaining parcels within the Community Facilities District shall not be affected.

Section 7. This Ordinance shall take effect and shall be in force 30 days after the date of its adoption and prior to the expiration of 15 days from the passage thereof shall be published at least once in the Fontana Herald News, a newspaper of general circulation, printed and published in the City of Fontana, State of California, together with the names of the City Council members voting for and against the same.

APPROVED AND ADOPTED this ____ day of _________ 2024.

READ AND APPROVED AS TO LEGAL FORM:

City Attorney
1738
4141-6101-8702.1
I, Germaine Key, City Clerk of the City of Fontana and Ex-Officio Clerk of the City Council, do hereby certify that the foregoing Ordinance is the actual Ordinance introduced at a regular meeting of said City Council on May 14, 2024, and was finally passed and adopted not less than five days thereafter on ___________, 2024, by the following vote, to wit:

AYES:

NOES:

ABSENT:

City Clerk
Mayor
ATTEST:

City Clerk
1739
4150-3343-3934.1
RESOLUTION NO. _____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

FONTANA AUTHORIZING THE EXECUTION AND

DELIVERY OF A JOINT COMMUNITY FACILITIES

AGREEMENT
WHEREAS, City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) (the “Community Facilities District”) has been established under the provisions of the MelloRoos Community Facilities Act of 1982 (the “Act”); WHEREAS, the Community Facilities District is authorized to levy a special tax (the “Special Tax”) upon the land within the Community Facilities District and to issue bonds (the “Bonds”) secured by the Special Tax, the proceeds of which are to be used to finance certain public facilities;
WHEREAS, the public facilities proposed to be financed by the Community Facilities District include certain facilities (the “City Facilities”) to be owned and operated by the City and certain facilities (the “Water District Facilities”) to be owned and operated by the West Valley Water District (the “Water District”);
WHEREAS, Section 53316.2 of the Act provides that a community facilities district may finance facilities to be owned or operated by a public agency other than the agency that created the community facilities district only pursuant to a joint community facilities agreement or a joint exercise of powers agreement adopted pursuant to said Section; WHEREAS, Section 53316.2 of the Act further provides that at any time prior to the adoption of the resolution of formation creating a community facilities district or a resolution of change to alter a district, or a resolution or resolutions authorizing issuance of bonds pursuant to Section 53356 of the Act, the legislative bodies of two or more local agencies may enter into a joint community facilities agreement pursuant to said Section and Sections 53316.4 and 53316.6 of the Act to exercise any power authorized by the Act with respect to the community facilities district being created if the legislative body of each entity adopts a resolution declaring that such a joint agreement would be beneficial to the residents of that entity; WHEREAS, no resolution authorizing the issuance of any Bonds has been adopted; WHEREAS, there has been presented to this meeting a form of Joint Community Facilities Agreement by and among the City, the Community Facilities District and the Water District that provides for the financing of the Water District Facilities from the proceeds of the Special Tax and Bonds (such Joint Community Facilities Agreement, in the form that presented to this meeting, with such changes, insertions and omissions as are made pursuant to this Resolution, being referred to herein as the “Joint Facilities Agreement”); and
WHEREAS, the City Council is the legislative body of the Community Facilities District; 1740
2 4150-3343-3934.1
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Fontana as follows:

Section 1. The City Council hereby declares that the Joint Facilities Agreement will be beneficial to the residents of the City.

Section 2. The Joint Facilities Agreement, in substantially the form submitted to this meeting and made a part hereof as though set forth herein, be and the same is hereby approved.

Each of the Mayor of the City, and such other member of the City Council as the Mayor may designate, the City Manager of the City and the Chief Financial Officer, Finance Department, of the City, and such other officer or employee of the City as the City Manager may designate (the “Authorized Officers”) is hereby authorized, and any one of the Authorized Officers is hereby directed, for and in the name of the City, to execute and deliver the Joint Facilities Agreement in the form submitted to this meeting, with such changes, insertions and omissions as the Authorized Officer executing the same may require or approve, such requirement or approval to be conclusively evidenced by the execution of the Joint Facilities Agreement by such Authorized Officer.

Each of the Authorized Officers is hereby authorized, and any one of the Authorized Officers is hereby directed, for and in the name of the Community Facilities District, to execute and deliver the Joint Facilities Agreement in the form submitted to this meeting, with such changes, insertions and omissions as the Authorized Officer executing the same may require or approve, such requirement or approval to be conclusively evidenced by the execution of the Joint Facilities Agreement by such Authorized Officer.

Section 3. All actions heretofore taken by the officers, employees and agents of the City with respect to the Joint Facilities Agreement, or in connection with or related to any of the matters referred to herein, are hereby approved, confirmed and ratified.

Section 4. The officers, employees and agents of the City are hereby authorized and directed to take all actions and do all things that they, or any of them, may deem necessary or desirable to accomplish the purposes of this Resolution and not inconsistent with the provisions hereof.

Section 5. This Resolution shall take effect immediately upon its adoption.

APPROVED and ADOPTED by the City Council of the City of Fontana on May 14, 2024.

READ AND APPROVED AS TO LEGAL FORM:

City Attorney
1741
4150-3343-3934.1
I, Germaine Key, City Clerk of the City of Fontana, California, and Ex-Officio Clerk of the City Council, do hereby certify that the foregoing Resolution is the actual Resolution duly and regularly adopted by the City Council of said City at a regular meeting thereof, held on May 14, 2024, by the following vote to-wit:

AYES:

NOES:

ABSENT:

City Clerk
Mayor
ATTEST:

City Clerk
1742
4147-4822-1262.1
RESOLUTION NO. _____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

FONTANA AUTHORIZING THE EXECUTION AND

DELIVERY OF A LETTER OF CREDIT AGREEMENT AND

AN ACQUISITION AND FUNDING AGREEMENT
WHEREAS, the City Council (the “City Council”) of the City of Fontana (the “City”) has, pursuant to the provisions of the Mello-Roos Community Facilities Act of 1982 (the “Act”), established City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) (the “Community Facilities District”);
WHEREAS, it is anticipated that, in order to finance certain public facilities, the Community Facilities District will issue special tax bonds (the “Bonds”) secured by a special tax (the “Special Tax”) levied within the Community Facilities District; WHEREAS, North Fontana Investment Company, LLC, a Delaware limited liability company (the “Developer”), and Richmond American Homes of Maryland, Inc., a Maryland corporation (the “Landowner”), propose to develop the property within the Community Facilities District;
WHEREAS, it is contemplated that the property within the Community Facilities District may be substantially undeveloped at the time the Bonds are issued and that, as a result, a significant portion of the Special Tax securing the Bonds would be levied on undeveloped property; WHEREAS, in order to increase the credit quality of the Bond issue, the Community Facilities District may require, as a condition to the issuance of the Bonds, that the Landowner provide a letter of credit securing the payment of Special Tax levied on certain of such undeveloped property within the Community Facilities District;
WHEREAS, in order to evidence such requirement and the matters pertaining thereto, there has been prepared and presented to this meeting a form of Letter of Credit Agreement, by and between the Community Facilities District and the Landowner (such Letter of Credit Agreement, in the form presented to this meeting, with such changes, insertions and omissions as are made pursuant to this Resolution, being referred to herein as the “Letter of Credit Agreement”); WHEREAS, the Developer proposes to construct, or cause to be constructed, certain of the public facilities proposed to be financed by the Community Facilities District pursuant to the Act, and the Community Facilities District proposes to purchase such public facilities from the Developer, title to which public facilities will be taken by the City; WHEREAS, the Community Facilities District, the City and the Developer desire to provide for the priority in which Special Tax and proceeds of the Bonds are to be applied and certain other matters regarding the Community Facilities District, the Special Tax and the Bonds; WHEREAS, in order to provide for such matters, there has been prepared and presented to this meeting a form of Acquisition and Funding Agreement by and among the Community Facilities District, the City and the Developer (such Acquisition and Funding Agreement, in the 1743
2 4147-4822-1262.1
form presented to this meeting, with such changes, insertions and omissions as are made pursuant to this Resolution, being referred to herein as the “Acquisition Agreement”); and WHEREAS, the City Council is the legislative body of the Community Facilities District; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Fontana as follows:

Section 1. The Letter of Credit Agreement, in substantially the form submitted to this meeting and made a part hereof as though set forth herein, be and the same is hereby approved.

Each of the Mayor of the City, and such other member of the City Council as the Mayor may designate, the City Manager of the City and the Chief Financial Officer, Finance Department, of the City, and such other officer or employee of the City as the City Manager may designate (the “Authorized Officers”) is hereby authorized, and any one of the Authorized Officers is hereby directed, for and in the name of the Community Facilities District, to execute and deliver the Letter of Credit Agreement in the form submitted to this meeting, with such changes, insertions and omissions as the Authorized Officer executing the same may require or approve, such requirement or approval to be conclusively evidenced by the execution of the Letter of Credit Agreement by such Authorized Officer.

Section 2. The Acquisition Agreement, in substantially the form submitted to this meeting and made a part hereof as though set forth herein, be and the same is hereby approved. Each of the Authorized Officers is hereby authorized, and any one of the Authorized Officers is hereby directed, for and in the name of the Community Facilities District, to execute and deliver the Acquisition Agreement in the form submitted to this meeting, with such changes, insertions and omissions as the Authorized Officer executing the same may require or approve, such requirement or approval to be conclusively evidenced by the execution of the Acquisition Agreement by such Authorized Officer.

Each of the Authorized Officers is hereby authorized, and any one of the Authorized Officers is hereby directed, for and in the name of the City, to execute and deliver the Acquisition Agreement in the form submitted to this meeting, with such changes, insertions and omissions as the Authorized Officer executing the same may require or approve, such requirement or approval to be conclusively evidenced by the execution of the Acquisition Agreement by such Authorized Officer.

Section 3. All actions heretofore taken by the officers, employees and agents of the City with respect to the Letter of Credit Agreement and the Acquisition Agreement, or in connection with or related to any of the matters referred to herein, are hereby approved, confirmed and ratified.

APPROVED and ADOPTED by the City Council of the City of Fontana on May 14, 2024.

READ AND APPROVED AS TO LEGAL FORM:

City Attorney
1745
4147-4822-1262.1
I, Germaine Key, City Clerk of the City of Fontana, California, and Ex-Officio Clerk of the City Council, do hereby certify that the foregoing Resolution is the actual Resolution duly and regularly adopted by the City Council of said City at a regular meeting thereof, held on May 14, 2024, by the following vote to-wit:

AYES:

NOES:

ABSENT:

City Clerk
Mayor
ATTEST:

City Clerk
1746
4128-1884-1422.1

CITY OF FONTANA
COMMUNITY FACILITIES DISTRICT NO. 113
(THE GARDENS PHASE TWO)

CONCURRENCE OF ELECTION OFFICIAL
I, Germaine Key, City Clerk of the City of Fontana (the “City”), hereby certify as follows:
(a) that I am the election official responsible for conducting special elections in the City; and
(b) that, pursuant to Section 53326(a) of the Mello-Roos Community Facilities Act of 1982 (the “Act”), I do hereby concur in (i) the holding on the date hereof of the special election to submit to the qualified electors of City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) (the “Community Facilities District”) the combined ballot proposition to authorize the Community Facilities District to incur bonded indebtedness, to authorize the Community Facilities District to levy a special tax and to establish an appropriations limit of the Community Facilities District, as provided in the resolution entitled “A Resolution of the City Council of the City of Fontana Calling Special Election for City of Fontana Community Facilities District No. 113 (The Gardens Phase Two),” proposed to be adopted by the City Council of the City on the date hereof, and (ii) the waiving by the unanimous consent of the qualified electors of the Community Facilities District of any time limit specified by Section 53326 of the Act and any requirement pertaining to the conduct of the election, including any time limit or requirement applicable to any election pursuant to Article 5 of the Act (commencing with Section 53345 of the Act).

Dated: May 14, 2024
Germaine Key, City Clerk
1747
4138-0869-7166.2

RECORDING REQUESTED BY AND
AFTER RECORDATION RETURN TO:

City Clerk
City of Fontana
8353 Sierra Avenue
Fontana, California 92335

NOTICE OF SPECIAL TAX LIEN

CITY OF FONTANA
COMMUNITY FACILITIES DISTRICT NO. 113
(THE GARDENS PHASE TWO)
Pursuant to the requirements of Section 3114.5 of the California Streets and Highways Code and Section 53328.3 of the Mello-Roos Community Facilities Act of 1982 (the “Act”), the undersigned City Clerk of the City of Fontana, State of California, hereby gives notice that a lien to secure payment of a special tax is hereby imposed by the City Council of the City of Fontana, County of San Bernardino, State of California. The special tax secured by this lien is authorized to be levied for the purpose of (a) paying the principal of and interest on bonds, the proceeds of which are being used to finance the facilities described in Exhibit A attached hereto and hereby made a part hereof, (b) providing such facilities, and (c) providing the services described in Exhibit A.

The special tax is authorized to be levied within City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) (the “Community Facilities District”) that has now been officially formed and the lien of the special tax is a continuing lien that shall secure each annual levy of the special tax and which shall continue in force and effect until the special tax obligation is prepaid, permanently satisfied and canceled in accordance with law or until the special tax ceases to be levied and a notice of cessation of special tax is recorded in accordance with Section 53330.5 of the Act.

The rate, method of apportionment and manner of collection of the authorized special tax is as set forth in Exhibit B attached hereto and hereby made a part hereof. Conditions under which the obligation to pay the special tax for facilities may be prepaid and permanently satisfied and the lien of the special tax canceled are as set forth in Exhibit B.

Notice is further given that upon the recording of this notice in the office of the County Recorder of the County of San Bernardino, the obligation to pay the special tax levy shall become a lien upon all nonexempt real property within the Community Facilities District in accordance with Section 3115.5 of the California Streets and Highways Code.

The name(s) of the owner(s) and the assessor’s tax parcel number(s) of the real property included within the Community Facilities District and not exempt from the special tax are as set forth in Exhibit C attached hereto and hereby made a part hereof.

Reference is made to the boundary map of the Community Facilities District recorded at Book 91 of Maps of Assessment and Community Facilities Districts at Page 56, in the office of the 1748
2 4138-0869-7166.2
County Recorder for the County of San Bernardino, State of California (Document No. 2024-0089360), which map is now the final boundary map of the Community Facilities District.

For further information concerning the current and estimated future tax liability of owners or purchasers of real property subject to this special tax lien, interested persons should contact the Chief Financial Officer, Finance Department, City of Fontana, 8353 Sierra Avenue, Fontana, California 92335, (909) 350-7679.

Dated: May __, 2024
By:

Germaine Key, City Clerk
1749
A-1
4138-0869-7166.2

EXHIBIT A

FACILITIES AND SERVICES TO BE FINANCED
Facilities
The types of public facilities to be financed by the Community Facilities District are streets, including grading, paving, curbs and gutters, sidewalks, street signalization and signage, street lights and parkway and landscaping related thereto, sewers, storm drains, flood control facilities, fire protection facilities, police facilities, public facilities, landscaping, library facilities, park and recreational facilities, water distribution, treatment and storage facilities, and land, rights-of-way and easements necessary for any of such facilities.

EXHIBIT B

RATE AND METHOD

OF APPORTIONMENT OF SPECIAL TAX
1751
City of Fontana March 20, 2024
Community Facilities District No. 113 (The Gardens Phase Two) Page 1

All of the real property in CFD No. 113, 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. DEFINITIONS
The terms hereinafter set forth have the following meanings:
"Acre" or "Acreage" means the land area expressed in acres of an Assessor’s Parcel as shown on an Assessor’s Parcel Map, or if the land area is not shown on an Assessor’s Parcel Map, the land area shown on the applicable final map, parcel map, condominium plan, or other recorded County map or the land area calculated to the reasonable satisfaction of the CFD Administrator using the boundaries set forth on such map or plan. For residential dwelling units within a condominium plan, the Acres applicable to each residential dwelling unit shall be determined by dividing (i) the Acres of the underlying lot or parcel on which the residential dwelling unit is constructed or to be constructed, by (ii) the total number of residential dwelling units constructed or to be constructed on such lot or parcel. 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, Part 1, Division 2 of Title 5 (commencing with Section 53311) of the California Government Code.
"Administrative Expenses" means the following actual or reasonably estimated costs directly related to the administration of CFD No. 113, including but not limited to: the costs of computing the Special Taxes and preparing the annual Special Tax collection schedules (whether by the City or designee thereof or both); the costs of collecting the Special Taxes (whether by the County or otherwise); the costs of remitting the Special Taxes to the Trustee; the costs of the Trustee (including its legal counsel) in the discharge of the duties required of it under the Indenture; the costs to the City, CFD No. 113 or any designee thereof of complying with arbitrage rebate requirements with respect to the Special Tax and CFD No. 113 Bonds; the costs to the City, CFD No. 113 or any designee thereof of complying with disclosure requirements of the City, CFD No. 113 or obligated persons associated with applicable federal and state securities laws and the Act; the costs associated with preparing Special Tax disclosure statements and responding to public inquiries regarding the Special Taxes; the costs of the City, CFD No. 113, or any designee thereof related to the reduction of the Assigned Facilities Special Tax and Backup Facilities Special Tax in accordance with Section C.1 herein; the costs of the City, CFD No. 113 or any designee thereof related to an appeal of the Special Tax; and the City’s annual administration fees and third party expenses related to CFD No. 113 Bonds. Administrative Expenses shall also include amounts estimated or advanced by the City or CFD No. 113 for any other administrative purposes of CFD No. 113, including attorney’s fees and other costs related to commencing and pursuing to completion any foreclosure of delinquent Special Taxes. 1752
City of Fontana March 20, 2024
Community Facilities District No. 113 (The Gardens Phase Two) Page 2 "Assessor" means the Assessor of the County.
"Assessor's Parcel" means a lot or parcel to which an Assessor’s parcel number is assigned as determined from an Assessor’s Parcel Map or the applicable assessment roll. "Assessor's Parcel Map" means an official map of the Assessor designating parcels by Assessor’s Parcel number.
"Assigned Facilities Special Tax" means the applicable Facilities Special Tax for (i) Residential Property as determined in accordance with Section C.1.a.(2) herein, and (ii) NonResidential Property as determined in accordance with Section C.1.a.(3) herein. "Assigned Services Special Tax" means the Services Special Tax, determined in accordance with Section C.2.b herein, that can be levied in any Fiscal Year on any Assessor’s Parcel of Developed Property.
"Authorized Facilities" means those facilities eligible to be funded by CFD No. 113. "Authorized Services" means those services eligible to be funded by CFD No. 113 in accordance with the Act, namely, fire protection and suppression services, maintenance and lighting of parks, parkways, streets, roads and open space, flood and storm protection services and maintenance and operation of any real property or other tangible property with an estimated useful life of five or more years that is owned by the City. "Backup Facilities Special Tax" means the Facilities Special Tax applicable to each Assessor's Parcel of Developed Property, as determined in accordance with Section C.1.a.(4) herein. "Buildout" means, for CFD No. 113, that all expected building permits for residential dwelling units and/or non-residential development to be constructed within CFD No. 113 have been issued, as determined by the CFD Administrator.
"CFD Administrator" means an official of the City, or designee thereof, responsible for determining the Special Tax Requirement for Facilities and the Special Tax Requirement for Services, providing for the levy and collection of the Special Taxes, and performing other duties as set forth herein.
"CFD No. 113" means City of Fontana Community Facilities District No. 113 (The Gardens Phase Two).
"CFD No. 113 Bonds" means any bonds or other debt (as defined in Section 53317(d) of the Act), whether in one or more series, issued by CFD No. 113 and secured by the Facilities Special Tax levy on property within the boundaries of CFD No. 113 under the Act. "City" means the City of Fontana, California.
"Contractual Impositions" means (a) a voluntary contractual assessment established and levied on an Assessor’s Parcel pursuant to Chapter 29 of Part 3 of Division 7 of the California Streets and Highways Code (commencing with Section 5898.10 et seq.), as amended from time to time, (b) a special tax established and levied on an Assessor’s Parcel pursuant to Section 53328.1 of the California Government Code and related provisions of the Act, as amended from time to time, and (c) any other fee, charge, tax or assessment established and levied on an individual Assessor’s Parcel pursuant to a contractual agreement or other voluntary consent by the owner thereof.
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Community Facilities District No. 113 (The Gardens Phase Two) Page 3 "Council" means the City Council of the City acting as the legislative body of CFD No. 113. "County" means the County of San Bernardino.
"Developed Property" means, for each Fiscal Year, (i) with respect to the Facilities Special Tax, all Taxable Property, exclusive of Taxable Public Property and Taxable Property Owner Association Property, for which a building permit for new construction, other than the construction of a garage, parking lot, or parking structure, was issued after January 1, 2024 and on or before May 1 of the Fiscal Year preceding the Fiscal Year for which the Facilities Special Taxes are being levied, and (ii) with respect to the Services Special Tax, all Taxable Property, exclusive of Taxable Public Property and Taxable Property Owner Association Property, (a) for which the Final Residential Subdivision was recorded prior to the Fiscal Year for which the Services Special Taxes are being levied, or (b) for which a building permit has been issued with respect to Non-Residential Property on or before May 1 of the Fiscal Year preceding the Fiscal Year for which the Services Special Taxes are being levied. "Facilities Special Tax" means the special tax to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property within CFD No. 113 to fund the Special Tax Requirement for Facilities, as set forth in Section C.1 herein.
"Final Residential Subdivision" means a Final Subdivision that creates individual lots for which building permits may be issued for residential dwelling units without further subdivision of such property.
"Final Subdivision" means (i) a subdivision of property by recordation of a final map, parcel map, or lot line adjustment approved by the City pursuant to the Subdivision Map Act (California Government Code Section 66410 et seq.) that creates individual lots or parcels for which building permits may be issued, or (ii) for condominiums, a final map approved by the City and a condominium plan recorded pursuant to California Civil Code Section 4285 that creates an individual lot(s) for which a building permit(s) may be issued without further subdivision. The term "Final Subdivision" shall not include any Assessor’s Parcel Map or subdivision map or portion thereof that does not create individual lots for which a building permit may be issued, including Assessor’s Parcels that are designated as remainder parcels.

Notwithstanding the above, a condominium plan for which one or more building permits have been issued, but no individual lots have been created for such building permits, shall be considered a Final Subdivision, and the portion of the condominium plan for which building permits have been issued shall be defined as Developed Property. "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 CFD No. 113 Bonds are issued, as modified, amended and/or supplemented from time to time.
"Land Use Class" means any of the classes listed in Table 1, Table 5, or Table 6 herein. "Lower Income Households Welfare Exemption Property" means, for each Fiscal Year, an Assessor’s Parcel within the boundaries of CFD No. 113 that is subject to a welfare exemption under subdivision (g) of Section 214 of the California Revenue and Taxation Code (or any successor statute), as indicated in the County’s assessment roll finalized as of the last preceding January 1.
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Community Facilities District No. 113 (The Gardens Phase Two) Page 4 "Maximum Facilities Special Tax" means the maximum Facilities Special Tax, determined in accordance with Section C.1 herein, that can be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.
"Maximum Services Special Tax" means the maximum Services Special Tax, determined in accordance with Section C.2 herein, that can be levied in any Fiscal Year on any Assessor’s Parcel of Developed Property.
"Minimum Sale Price" means the minimum price at which any parcel in a given Land Use Class has sold or is expected to be sold in a normal marketing environment and shall not include prices for such parcels that are sold at a discount to expected sales prices for the purpose of stimulating the initial sales activity with respect to such Land Use Class. "Non-Residential Property" means all Assessor’s Parcels of Developed Property for which a building permit(s) has been issued by the City permitting the construction of one or more nonresidential structures or facilities. "Outstanding Bonds" means all CFD No. 113 Bonds which are outstanding under the Indenture.
"Planning Area" means an area designated with the letters "P.A." as shown on Exhibit B. "Price Point Consultant" means any consultant or firm of such consultants selected by CFD No. 113 that (a) has substantial experience in performing price point studies for residential dwelling units within community facilities districts or otherwise estimating or confirming pricing for residential dwelling units in community facilities districts, (b) has recognized expertise in analyzing economic and real estate data that relates to the pricing of residential dwelling units in community facilities districts, (c) is in fact independent and not under the control of CFD No. 113 or the City, (d) does not have any substantial interest, direct or indirect, with or in (i) CFD No. 113, (ii) the City, (iii) any owner of real property in CFD No. 113, or (iv) any real property in CFD No. 113, and (e) is not connected with CFD No. 113 or the City as an officer or employee thereof, but who may be regularly retained to make reports to CFD No. 113 or the City.
"Price Point Study" means a price point study or a letter updating a previous price point study prepared by the Price Point Consultant pursuant to Section C herein. "Property Owner Association Property" means, for each Fiscal Year, (i) any property within the boundaries of CFD No. 113 for which the owner of record, as determined from the County’s assessment roll for the Fiscal Year in which the Special Tax is being levied, is a property owner’s association, including any master or sub-association, or (ii) any property located in a Final Subdivision that was recorded as of the January 1 preceding the Fiscal Year in which the Special Tax is being levied and which, as determined from such Final Subdivision, is or will be open space, a common area recreation facility, or a private street. Notwithstanding the foregoing, any property previously classified as Developed Property and subsequently owned in fee or by easement, or dedicated to, a property owner association, including any master or subassociation, shall remain classified as Developed Property. "Proportionately" means that the ratio of the actual Facilities Special Tax levy to the Assigned Facilities Special Tax is equal for all Assessor’s Parcels of Developed Property, and that the ratio of the actual Services Special Tax levy to the Assigned Services Special Tax is equal for all Assessor’s Parcels of Developed Property. For Undeveloped Property, "Proportionately" means 1755
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Community Facilities District No. 113 (The Gardens Phase Two) Page 5 that the ratio of the actual Facilities Special Tax levy per Acre to the Maximum Facilities Special Tax per Acre is equal for all Assessor’s Parcels of Undeveloped Property. The term "Proportionately" shall similarly be applied to other categories of Taxable Property as listed in Section D herein.
"Public Property" means, for each Fiscal Year, any property within the boundaries of CFD No. 113 that is (i) owned by, irrevocably offered or dedicated to the federal government, the State, the County, the City, or any local government or other public agency, provided, however, that any property leased by a public agency to a private entity and subject to taxation under Section 53340.1 of the Act shall be taxed and classified according to its use; or (ii) encumbered by a public utility easement making impractical its use for any purpose other than that set forth in the easement.
"Rate and Method of Apportionment" means this Rate and Method of Apportionment for CFD No. 113.
"Residential Floor Area" means all of the square footage of living area within the perimeter of a residential structure, not including any carport, walkway, garage, overhang, patio, enclosed patio, or similar area. The determination of Residential Floor Area for an Assessor’s Parcel shall be as set forth in the building permit(s) issued for such Assessor’s Parcel and/or as set forth in the appropriate records kept by the Building and Safety Department of the City, or other applicable City department, as determined by the CFD Administrator. "Residential Property" means all Assessor’s Parcels of Developed Property for which a building permit(s) has been issued by the City permitting the construction thereon of one or more residential dwelling units.
"Services Special Tax" means the special tax to be levied in each Fiscal Year on each Assessor’s Parcel of Developed Property within CFD No. 113 to fund the Special Tax Requirement for Services, as set forth in Section C.2 herein. "Special Tax" or "Special Taxes" means the Facilities Special Tax and/or Services Special Tax, as applicable.
"Special Tax Requirement for Facilities" means, for any Fiscal Year, that amount required, after taking into account available amounts held in the funds and accounts under the Indenture, for the following items: (i) debt service on all Outstanding Bonds due in the calendar year commencing in such Fiscal Year; (ii) periodic costs with respect to the CFD No. 113 Bonds, including but not limited to, costs of credit enhancement and federal rebate payments due in the calendar year commencing in such Fiscal Year; (iii) pay all or a portion of Administrative Expenses; (iv) any amounts required to establish or replenish any reserve funds for all Outstanding Bonds; (v) without duplicating any amounts described in clause (iv), above, reasonably anticipated Facilities Special Tax delinquencies based on the delinquency rate for the Facilities Special Tax in the previous Fiscal Year, as said levy for delinquencies shall be limited by the Act; and (vi) pay directly for the acquisition or construction of Authorized Facilities, provided that the inclusion of such amount does not increase the Facilities Special Tax levy beyond the first step in Section D.1 herein.
"Special Tax Requirement for Services" means that amount required in any Fiscal Year for CFD No. 113 to (i) pay directly for the Authorized Services; (ii) pay Administrative Expenses not funded through the Special Tax Requirement for Facilities as determined by the CFD 1756
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Community Facilities District No. 113 (The Gardens Phase Two) Page 6 Administrator; (iii) pay for reasonably anticipated Services Special Tax delinquencies based on the delinquency rate for the Services Special Tax levy in the previous Fiscal Year; less (iv) a credit for funds available to reduce the annual Services Special Tax levy, as determined by the CFD Administrator, so long as the amount required is not less than zero. "State" means the State of California.
"Taxable Property" means all of the Assessor's Parcels within the boundaries of CFD No. 113 which are not exempt from the Special Tax pursuant to applicable law or Section E herein. "Taxable Property Owner Association Property" means all Assessor’s Parcels of Property Owner Association Property that are not exempt pursuant to Section E herein. "Taxable Public Property" means all Assessor’s Parcels of Public Property that are not exempt pursuant to Section E herein.
"Total Tax Burden" means, for a parcel of residential property within a Land Use Class, for the Fiscal Year in which Total Tax Burden is being calculated, the sum of (a) the Assigned Facilities Special Tax for such Fiscal Year, plus (b) the Assigned Services Special Tax for such Fiscal Year, plus (c) the ad valorem property taxes, special assessments, special taxes for any overlapping community facilities districts, and any other governmental fees, charges (other than fees or charges for services such as sewer and trash), taxes and assessments (which, for purposes of clarity, do not include Contractual Impositions) collected by the County on ad valorem tax bills and that the CFD Administrator estimates would be levied or imposed on such residential property in such Fiscal Year if the residential dwelling unit thereon or therein had been completed and sold, and was subject to such fees, charges, taxes and assessments in such Fiscal Year.
"Trustee" means the trustee or fiscal agent under the Indenture. "Undeveloped Property" means, for each Fiscal Year, all Taxable Property not classified as Developed Property, Taxable Public Property or Taxable Property Owner Association Property.

Please refer to additional definitions in Section H herein relating to the Prepayment of Facilities Special Tax.

C. MAXIMUM SPECIAL TAX RATE

1. Facilities Special Tax
At least 30 days prior to the issuance of the first series of CFD No. 113 Bonds, the Assigned Facilities Special Tax for Residential Property (set forth in Table 1 below) shall be analyzed in accordance with and subject to the conditions set forth in this Section C. At such time, the CFD Administrator shall request the Price Point Consultant to prepare a Price Point Study setting forth the Minimum Sale Price of residential property within each Land Use Class. If based upon such Price Point Study the CFD Administrator calculates that the Total Tax Burden applicable to one 1757
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Community Facilities District No. 113 (The Gardens Phase Two) Page 7 or more Land Use Classes of residential property constructed or to be constructed within CFD No. 113 shall exceed 1.95% of the Minimum Sale Price of such residential property constructed or to be constructed within CFD No. 113, the CFD Administrator shall reduce the Assigned Facilities Special Tax to the extent necessary to cause the Total Tax Burden that shall apply to residential property within such Land Use Class(es) to not exceed 1.95% of the Minimum Sale Price of such residential property. Each Assigned Facilities Special Tax reduction for a Land Use Class shall be calculated separately, and it shall not be required that such reduction be proportionate among Land Use Classes. In connection with any reduction in the Assigned Facilities Special Tax for Residential Property, the CFD Administrator shall also reduce the Assigned Facilities Special Tax for Non-Residential in accordance with Section C.1.a.(3) herein, and the Backup Facilities Special Tax in accordance with Section C.1.a.(4) herein. Upon determining the reductions, if any, in the Assigned Facilities Special Tax and Backup Facilities Special Tax required pursuant to this Section C, the CFD Administrator shall complete the Certificate to Amend Facilities Special Tax substantially in the form attached hereto as Exhibit A (the “Certificate to Amend”) and shall execute such completed Certificate to Amend and shall deliver such Certificate to Amend to CFD No. 113. Upon receipt thereof, if in satisfactory form, CFD No. 113 shall execute such Certificate to Amend. The reduced Assigned Facilities Special Tax and Backup Facilities Special Tax specified in such Certificate to Amend shall become effective upon the execution of such Certificate to Amend by CFD No. 113. The Assigned Facilities Special Tax and Backup Facilities Special Tax reductions permitted pursuant to this Section C shall be reflected in an amended notice of Special Tax lien which CFD No. 113 shall cause to be recorded with the San Bernardino County Recorder as soon as practicable after execution of the Certificate to Amend by CFD No. 113. If based upon such Price Point Study the CFD Administrator calculates that the Total Tax Burden applicable to each Land Use Class of residential property constructed or to be constructed within CFD No. 113 does not exceed

1.95% of the Minimum Sale Price of each such Land Use Class of residential property constructed or to be constructed within CFD No. 113, then there shall be no reduction in the Assigned Facilities Special Tax, nor shall there be a reduction in the Backup Facilities Special Tax.
a. Developed Property
(1). Maximum Facilities Special Tax
The Maximum Facilities Special Tax for each Assessor's Parcel classified as Developed Property shall be the greater of (i) the amount derived by application of the Assigned Facilities Special Tax or (ii) the amount derived by application of the Backup Facilities Special Tax.
(2). Assigned Facilities Special Tax for Residential Property Residential Property shall be assigned to Land Use Classes 1 through 15 as listed in Table 1 below based on the Planning Area, Description, and the Residential Floor Area associated with each such residential dwelling unit. The Assigned Facilities Special Tax that shall be levied in any Fiscal Year for each Land Use Class is shown below in Table 1 and shall not be subject to escalation.
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Community Facilities District No. 113 (The Gardens Phase Two) Page 8 Table 1
Assigned Facilities Special Tax for Residential Property City of Fontana CFD No. 113 (The Gardens Phase Two)
Land
Use
Class
Planning
Area Description
Residential Floor
Area (square feet)
Assigned
Facilities
Special Tax
1 Planning
Area 1
Residential Property 2,100 or greater $4,137 per unit
2 Residential Property 1,950 to less than 2,100 $3,956 per unit 3 Residential Property 1,800 to less than 1,950 $3,775 per unit 4 Residential Property 1,650 to less than 1,800 $3,554 per unit 5 Residential Property Less than 1,650 $3,344 per unit
6 Planning
Area 2
Residential Property 2,100 or greater $3,946 per unit
7 Residential Property 1,950 to less than 2,100 $3,759 per unit 8 Residential Property 1,800 to less than 1,950 $3,572 per unit 9 Residential Property 1,650 to less than 1,800 $3,385 per unit 10 Residential Property Less than 1,650 $3,198 per unit 11 Planning
Areas
3 & 4
Residential Property 2,225 or greater $4,604 per unit
12 Residential Property 2,075 to less than 2,225 $4,259 per unit 13 Residential Property 1,925 to less than 2,075 $3,914 per unit 14 Residential Property 1,775 to less than 1,925 $3,699 per unit 15 Residential Property Less than 1,775 $3,549 per unit (3). Assigned Facilities Special Tax for Non-Residential Property The Assigned Facilities Special Tax for an Assessor’s Parcel of Non-Residential Property within a Planning Area shall equal the lesser of (a) the Assigned Facilities Special Tax applicable for such Planning Area set forth in Table 2 below (as such Assigned Facilities Special Tax shall not be subject to escalation), or (b) in connection with any reduction in the Assigned Facilities Special Tax for Residential Property as set forth in Section C.1 herein, the amount per Acre calculated for each Planning Area pursuant to the formula below:

RAFST = AFST  ATP
These terms have the following meaning:

RAFST = the reduced Assigned Facilities Special Tax for Non-Residential Property within a Planning Area.

ATP = The sum of the Acreage of all Taxable Property within a Final Subdivision (assuming Buildout of CFD No. 113) within such Planning Area (after excluding 1759
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Community Facilities District No. 113 (The Gardens Phase Two) Page 9 Public Property and Property Owner Association Property as set forth in Section E.1 herein).

RBFST = AFST  ATPX
These terms have the following meaning:

RBFST = the reduced Backup Facilities Special Tax for Developed Property within a Planning Area.

Table 3
Backup Facilities Special Tax for Developed Property
City of Fontana CFD No. 113 (The Gardens Phase Two)
Planning Area
Backup
Facilities
Special Tax
P.A. 1 $69,540 per Acre
P.A. 2 $70,560 per Acre
P.A. 3 $60,450 per Acre
P.A. 4 $61,530 per Acre
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Community Facilities District No. 113 (The Gardens Phase Two) Page 10 Furthermore, all Assessors’ Parcels within CFD No. 113 shall be relieved simultaneously and permanently from the obligation to pay and disclose the Backup Facilities Special Tax if the CFD Administrator calculates that (i) the annual debt service required for the Outstanding Bonds, when compared to the Assigned Facilities Special Tax that shall be levied against all Assessors’ Parcels of Developed Property in CFD No. 113 results in 110% debt service coverage (i.e., the Assigned Facilities Special Tax that shall be levied against all Developed Property in CFD No. 113 in each remaining Fiscal Year based on the then existing development is at least equal to the sum of (a) 1.10 times the debt service necessary to support the remaining Outstanding Bonds in each corresponding Fiscal Year, and (b) Administrative Expenses), and (ii) all authorized CFD No. 113 Bonds have already been issued or the Council has covenanted that it shall not issue any additional CFD No. 113 Bonds (except refunding bonds) to be supported by the Facilities Special Tax in CFD No. 113.
(5). Multiple Land Uses
In some instances an Assessor’s Parcel may contain both Developed Property and Undeveloped Property. In such cases, the Acreage of the Assessor’s Parcel shall be allocated between Developed Property and Undeveloped Property based on the portion of the Assessor’s Parcel for which building permits had been issued prior to May 1 of the prior Fiscal Year and the portion of the Assessor’s Parcel for which building permits had not been issued prior to May 1 of the prior Fiscal Year.

Table 4
Maximum Facilities Special Tax for Undeveloped Property, Taxable Public Property and Taxable Property Owner Association Property City of Fontana CFD No. 113 (The Gardens Phase Two)
Planning Area
Maximum
Facilities
Special Tax
P.A. 1 $69,540 per Acre
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Community Facilities District No. 113 (The Gardens Phase Two) Page 11 Planning Area
Maximum
Facilities
Special Tax
P.A. 2 $70,560 per Acre
P.A. 3 $60,450 per Acre
P.A. 4 $61,530 per Acre

Table 6
Assigned Services Special Tax for Developed Property
City of Fontana CFD No. 113 (The Gardens Phase Two)
Fiscal Year 2023-2024
Land
Use
Class Description
Assigned Services
Special Tax
1 Final Residential Subdivision $550 per unit
2 Non-Residential Property $8,450 per Acre
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Community Facilities District No. 113 (The Gardens Phase Two) Page 12 c. Increase in the Maximum Services Special Tax
The Maximum Services Special Tax in Table 5 above shall be applicable for Fiscal Year 2023-2024, and shall increase thereafter, commencing on July 1, 2024, and on each July 1 thereafter by an amount equal to two percent (2%) of the amount in effect for the previous Fiscal Year.
d. Increase in the Assigned Services Special Tax
The Assigned Services Special Tax in Table 6 above shall be applicable for Fiscal Year 2023-2024, and shall increase thereafter, commencing on July 1, 2024, and on each July 1 thereafter in an amount estimated to fund the Special Tax Requirement for Services for the Fiscal Year commencing on such July 1. However, in no case shall the Assigned Services Special Tax for an Assessor’s Parcel of Developed Property exceed the applicable Maximum Services Special Tax for such Assessor’s Parcel of Developed Property in any Fiscal Year.
e. Multiple Land Uses
In some instances an Assessor’s Parcel of Developed Property may contain more than one Land Use Class. In such cases, the Acreage of Developed Property shall be allocated between Residential Property and Non-Residential Property based on the amount of Acreage designated for each land use as determined by reference to the site plan approved for such Assessor's Parcel. The Maximum Services Special Tax that can be levied on such Assessor’s Parcel shall be the sum of the Maximum Services Special Tax that can be levied on each type of property located on that Assessor’s Parcel. The CFD Administrator’s allocation to each type of property shall be final.

D. METHOD OF APPORTIONMENT OF THE SPECIAL TAX

First: The Facilities Special Tax shall be levied on each Assessor’s Parcel of Developed Property in an amount equal to 100% of the applicable Assigned Facilities Special Tax; Second: If additional monies are needed to satisfy the Special Tax Requirement for Facilities after the first step has been completed, the Facilities Special Tax shall be levied Proportionately on each Assessor's Parcel of Undeveloped Property at up to 100% of the Maximum Facilities Special Tax for Undeveloped Property;
Third: If additional monies are needed to satisfy the Special Tax Requirement for Facilities after the first two steps have been completed, then the levy of the Facilities Special Tax on each Assessor's Parcel of Developed Property whose Maximum Facilities Special Tax is determined through the application of the Backup Facilities Special Tax shall be increased in equal percentages from the Assigned Facilities Special Tax up to the Maximum Facilities Special Tax for each such Assessor's Parcel;
Fourth: If additional monies are needed to satisfy the Special Tax Requirement for Facilities after the first three steps have been completed, then the Facilities Special Tax shall be levied Proportionately on each Assessor’s Parcel of Taxable Public Property and Taxable Property 1763
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Community Facilities District No. 113 (The Gardens Phase Two) Page 13 Owner Association Property at up to 100% of the Maximum Facilities Special Tax for Taxable Public Property and Taxable Property Owner Association Property, as needed to satisfy the Special Tax Requirement for Facilities.

E. EXEMPTIONS

1. Facilities Special Tax
No Facilities Special Tax shall be levied on up to the applicable Acreage limit of Public Property and/or Property Owner Association Property established for each Planning Area as set forth in Table 7 below. Tax-exempt status shall be assigned by the CFD Administrator in the chronological order in which property within a Planning Area becomes Public Property or Property Owner Association Property. However, should an Assessor’s Parcel no longer be classified as Public Property or Property Owner Association Property, it shall, from that point forward, be subject to the Facilities Special Tax.
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Community Facilities District No. 113 (The Gardens Phase Two) Page 14 Table 7
Exempt Acreage Limits
City of Fontana CFD No. 113 (The Gardens Phase Two)
Planning Area
Exempt
Acreage Limit
P.A. 1 3.36 Acres
P.A. 2 2.00 Acres
P.A. 3 2.66 Acres
P.A. 4 3.08 Acres
Notwithstanding the above, an Assessor’s Parcel within a Planning Area that is transferred to a public agency or property owner’s association prior to the issuance of the first series of CFD No. 113 Bonds that causes the Acreage of Public Property and Property Owner Association Property within such Planning Area to exceed the applicable Acreage limit that can be designated by the CFD Administrator under this Section E.1 shall also be exempted from paying the Special Tax.

F. MANNER OF COLLECTION
The 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. 113 may directly bill the Special Tax, and/or may collect Special Taxes at a different time or in a different manner if necessary to meet financial obligations, and, to the extent of the Facilities Special Tax, may covenant to foreclose and may actually foreclose on delinquent Assessor’s Parcels. 1765
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Community Facilities District No. 113 (The Gardens Phase Two) Page 15 G. APPEALS AND INTERPRETATIONS
Any landowner or resident who feels that the amount of the Special Tax levied on his/her Assessor’s Parcel is in error may submit a written appeal to the CFD Administrator, provided that the appellant is current in his/her payment of Special Taxes. During the pendency of an appeal, all Special Taxes previously levied must be paid on or before the payment date established when the levy was made. The CFD Administrator shall review the appeal, meet with the appellant if the CFD Administrator deems necessary, and advise the appellant of its determination. If the CFD Administrator agrees with the appellant, a cash refund shall not be made (except for the last year of levy), but the amount of the Special Tax levied shall be appropriately modified through an adjustment to the Special Tax levy in the following Fiscal Year. If the CFD Administrator disagrees with the appellant and the appellant is dissatisfied with the determination, the appellant then has 30 days in which to appeal to the Council by filing a written notice of appeal with the City Clerk, provided that the appellant is current in his/her payment of Special Taxes. This second appeal must specify the reasons for its disagreement with the CFD Administrator's determination.

The following additional definitions apply to this Section H:
"CFD Public Facilities Costs" means either $20,183,675 in 2024 dollars, which shall increase by the Construction Inflation Index on July 1, 2025, and on each July 1 thereafter, or such lower number as (i) shall be determined by the CFD Administrator as sufficient to provide funding for the Authorized Facilities under the authorized bonding program for CFD No. 113, or (ii) shall be determined by the Council concurrently with a covenant that it shall not issue any more CFD No. 113 Bonds (except refunding bonds) to be supported by the Facilities Special Tax levy under this Rate and Method of Apportionment.
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Community Facilities District No. 113 (The Gardens Phase Two) Page 16 "Construction Inflation Index" means the annual percentage change in the Engineering News Record Building Cost Index for the City of Los Angeles, measured as of the month of December in the calendar year which ends in the previous Fiscal Year. In the event this index ceases to be published, the Construction Inflation Index shall be another index as determined by the CFD Administrator that is reasonably comparable to the Engineering News Record Building Cost Index for the City of Los Angeles.
"Future Facilities Costs" means the CFD Public Facilities Costs minus (i) costs of Authorized Facilities previously paid from the Improvement Fund, (ii) moneys currently on deposit in the Improvement Fund available to pay costs of Authorized Facilities, and (iii) the amount the CFD Administrator reasonably expects to derive from the reinvestment of these funds. "Improvement Fund" means a fund or account specifically identified in the Indenture (or prior to the issuance of the first series of CFD No. 113 Bonds a fund or account held by the City) to hold funds which are currently available for expenditure to acquire or construct Authorized Facilities.
"Previously Issued Bonds" means, for any Fiscal Year, all Outstanding Bonds that are outstanding under the Indenture after the first interest and/or principal payment date following the current Fiscal Year.

1. Prepayment in Full
The Facilities Special Tax Prepayment Amount (defined below) shall be calculated as summarized below (capitalized terms as defined below):

1. Confirm that no Special Tax delinquencies apply to such Assessor’s Parcel.

3. (a) Divide the Assigned Facilities Special Tax computed pursuant to paragraph 2 by the total estimated Assigned Facilities Special Tax levy for CFD No. 113 based on the Assigned Facilities Special Taxes for Developed Property which could be levied on all expected development assuming Buildout of CFD No. 113, excluding any Assessor’s Parcels which have been prepaid, and
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Community Facilities District No. 113 (The Gardens Phase Two) Page 17 (b) Divide the Backup Facilities Special Tax computed pursuant to paragraph 2 by the total estimated Backup Facilities Special Taxes at Buildout for the entire CFD No. 113, excluding any Assessor’s Parcels which have been prepaid.

6. Compute the current Future Facilities Costs.

9. Determine the Facilities Special Tax levied on the Assessor’s Parcel in the current Fiscal Year which has not yet been paid.

11. Add the amounts computed pursuant to paragraphs 8 and 9 and subtract the amount computed pursuant to paragraph 10 (the "Defeasance Amount").

13. The reserve fund credit (the "Reserve Fund Credit") shall equal the lesser of: (a) the expected reduction in the reserve requirement (as defined in the Indenture), if any, associated with the redemption of Previously Issued Bonds as a result of the prepayment, or (b) the amount derived by subtracting the new reserve requirement (as defined in the Indenture) in effect after the redemption of Previously Issued Bonds as a result of the prepayment from the balance in the reserve fund on the prepayment date, but in no event shall such amount be less than zero. No Reserve Fund Credit shall be granted if the amount then on deposit in the reserve fund for the Previously Issued Bonds is below 100% of the reserve requirement (as defined in the Indenture). 1768
City of Fontana March 20, 2024
Community Facilities District No. 113 (The Gardens Phase Two) Page 18

2. Prepayment in Part
The amount of the prepayment shall be calculated as in Section H.1; except that a partial prepayment shall be calculated according to the following formula:

PP = [(PE – A) x F] + A
These terms have the following meaning:

PP = the partial prepayment.

PE = the Facilities Special Tax Prepayment Amount calculated according to Section H.1.

F = the percentage, expressed as a decimal, by which the owner of the Assessor’s Parcel is partially prepaying the Facilities Special Tax.

A = the Administrative Fees and Expenses calculated according to Section H.1.

3. General Provisions Applicable to the Prepayment of Facilities Special Tax (a). Use of the Facilities Special Tax Prepayment Amount The Facilities Special Tax Prepayment Amount, less the Administrative Fees and Expenses calculated according to Section H.1 which shall be retained by CFD No. 113, and less the Future Facilities Amount calculated according to Section H.1 which shall be deposited into the Improvement Fund, shall be deposited into specific funds established under the Indenture, to fully or partially redeem as many Outstanding Bonds as possible, and, if amounts are less than $5,000, to make debt service payments on the Outstanding Bonds.
(b). Full Prepayment of Facilities Special Tax
Upon confirmation of the payment of the current Fiscal Year’s entire Facilities Special Tax obligation, the CFD Administrator shall remove the current Fiscal Year’s Facilities Special Tax levy for such Assessor’s Parcel from the County tax rolls. With respect to any Assessor’s Parcel that is prepaid in accordance with Section H.1, the CFD Administrator shall cause a suitable notice to be recorded in compliance with the Act, to indicate the prepayment of the Facilities Special Tax and the release of the Facilities Special Tax lien on such Assessor’s Parcel, and the obligation of such Assessor’s Parcel to pay the Facilities Special Tax shall cease.
(c). Partial Prepayment of Facilities Special Tax
With respect to any Assessor’s Parcel that is partially prepaid, the CFD Administrator shall (i) distribute or cause to be distributed the funds remitted to it according to Section H.3.(a) and (ii) indicate in the records of CFD No. 113 that there has been a partial 1769
City of Fontana March 20, 2024
Community Facilities District No. 113 (The Gardens Phase Two) Page 19 prepayment of the Facilities Special Tax and that a portion of the Facilities Special Tax with respect to such Assessor’s parcel, equal to the outstanding percentage (1.00 – F) of the remaining Maximum Facilities Special Tax, shall continue to be levied on such Assessor’s Parcel pursuant to Section D herein.
(d). Debt Service Coverage
Notwithstanding the foregoing, no prepayment of the Facilities Special Tax shall be allowed unless the amount of Facilities Special Tax that may be levied on Taxable Property (assuming Buildout) within CFD No. 113 in each future Fiscal Year (after excluding Public Property and Property Owner Association Property as set forth in Section E.1 herein), after the proposed prepayment, is at least equal to the sum of (i) 1.10 times the debt service necessary to support the remaining Outstanding Bonds in each corresponding Fiscal Year, and (ii) Administrative Expenses.

T/Clients/FONTANA/MELLO/CFD Nos. 113 (The Gardens Phase Two)/Rate and Method/Fontana CFD No. 113 (The Gardens Phase Two) RMA for ROI.docx 1770
A-1

EXHIBIT A

CERTIFICATE TO AMEND FACILITIES SPECIAL TAX
CFD NO. 113 CERTIFICATE

Planning
Area
Original
Assigned
Facilities
Special Tax
Modified
Assigned
Facilities
Special Tax
P.A. 1 $59,110 per Acre $[____] per Acre
P.A. 2 $59,970 per Acre $[____] per Acre
P.A. 3 $51,370 per Acre $[____] per Acre
P.A. 4 $52,300 per Acre $[____] per Acre
1771
A-2
(c) The Backup Facilities Special Tax for Developed Property within a Planning Area, set forth in Table 3 within Section C.1.a.(4) of the Rate and Method, shall be modified as follows:

2. The Assigned Facilities Special Tax and the Backup Facilities Special Tax for Developed Property may only be reduced prior to the first issuance of CFD No. 113 Bonds.

3. Upon execution of the certificate by CFD No. 113, CFD No. 113 shall cause an amended notice of Special Tax lien for CFD No. 113 to be recorded reflecting the reductions set forth herein.

All capitalized terms used herein shall have the meanings set forth in the Rate and Method.

CITY OF FONTANA COMMUNITY FACILITIES DISTRICT NO. 113
(THE GARDENS PHASE TWO)
By:___________________________ Date:______________________ 1772
B

EXHIBIT B

EXHIBIT C

PROPERTY OWNER,
ASSESSOR’S PARCEL NUMBERS AND PROPERTY DESCRIPTION
Name of
Property Owner
San Bernardino County
Assessor Parcel Nos. Property Description
North Fontana Investment
Company, LLC
1118-401-01
1118-401-02
Lot 1 and Lot 2 of Tract Map No.
20362, recorded on April 6, 2022,
in Book 362 of Tract Maps at
Pages 78 through 84, inclusive, in
the Office of the San Bernardino
County Recorder (recorded as
Document No. 2022-0129505).

Richmond American Homes
of Maryland, Inc.
1118-421-01
1118-441-01
Lot 3 and Lot 4 of Tract Map No.
20362, recorded on April 6, 2022,
in Book 362 of Tract Maps at
Pages 78 through 84, inclusive, in
the Office of the San Bernardino
County Recorder (recorded as
Document No. 2022-0129505).
1774
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COMMUNITY FACILITIES

DISTRICT REPORT

CITY OF FONTANA
COMMUNITY FACILITIES DISTRICT NO. 113
(THE GARDENS PHASE TWO)
Report Date: April 26, 2024
1775
www.FinanceDTA.com
18201 Von Karman, Suite 220
Irvine, CA 92612

COMMUNITY FACILITIES DISTRICT REPORT
FOR

CITY OF FONTANA
COMMUNITY FACILITIES DISTRICT NO. 113
(THE GARDENS PHASE TWO)

Prepared for:

City of Fontana
8353 Sierra Avenue
Fontana, CA 92335
1776
TABLE

OF CONTENTS

SECTION
I INTRODUCTION .............................................................. 1 II PROJECT DESCRIPTION ................................................ 2

III DESCRIPTION AND ESTIMATED COSTS OF PUBLIC
FACILITIES AND SERVICES ............................................ 3 A Description of Public Facilities and Services ................ 3 B Estimated Costs of Public Facilities and
Services ................................................................................. 4

IV BONDED INDEBTEDNESS AND INCIDENTAL
EXPENSES .......................................................................... 6 A Projected Bond Sales ......................................................... 6 B Incidental Bond Issuance Expenses to be
Included in the Proposed Bonded
Indebtedness ....................................................................... 6 C Incidental Expenses to be Included in the
Annual Levy of Special Taxes ........................................... 6 V RATE AND METHOD OF APPORTIONMENT .............. 7
A Explanation for Special Tax Apportionment ................. 7 B Maximum Facilities Special Tax ....................................... 8 C Backup Facilities Special Tax ............................................ 9 D Maximum Services Special Tax ........................................ 9 E Accuracy of Information ................................................... 9 VI BOUNDARIES OF THE CFD .......................................... 10 VII GENERAL TERMS AND CONDITIONS ....................... 11 A Substitution of Facilities and Services ......................... 11 B Appeals and Interpretations ........................................... 11 C Prepayment of Special Tax ............................................. 11

APPENDICES

APPENDIX A RATE AND METHOD OF

APPORTIONMENT

APPENDIX B BOUNDARY MAP
1777
1 SECTION I

INTRODUCTION

City of Fontana April 26, 2024
Community Facilities District No. 113 (The Gardens Phase Two) www.FinanceDTA.com

I INTRODUCTION
WHEREAS, the City Council of the City of Fontana (hereinafter referred to as the "Council") did, pursuant to the provision of the "Mello-Roos Community Facilities Act of 1982," being Chapter 2.5, Part 1, Division 2 of Title 5 (commencing with Section 53311) of the Government Code of the State of California (hereinafter referred to as the "Act"), and specifically Section 53321.5 thereof, expressly order the filing of a written "Report" with the legislative body of the proposed Community Facilities District (“CFD”). This CFD being City of Fontana CFD No. 113 (The Gardens Phase Two) shall hereinafter be referred to as:
"CFD No. 113"; and,
WHEREAS, on April 9, 2024, Council, pursuant to the Act, adopted a resolution entitled “A

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FONTANA OF INTENTION TO

ESTABLISH A COMMUNITY FACILITIES DISTRICT PROPOSED TO BE NAMED CITY OF FONTANA COMMUNITY FACILITIES DISTRICT NO. 113 (THE GARDENS PHASE TWO) AND TO AUTHORIZE THE LEVY OF A SPECIAL TAX THEREIN" (hereinafter referred to as the "Resolution of Intention") directing that the Report generally contain the following:

1. A brief description of the public facilities and services by type that will be required to adequately meet the needs of CFD No. 113; and

2. An estimate of the cost of providing the public facilities and services, including an estimate of the fair and reasonable cost of the public facilities proposed to be purchased as completed public facilities and of the incidental expenses proposed to be paid.

WHEREAS, each officer of the City of Fontana (hereinafter referred to as the "City") who is or will be responsible for providing one or more of the proposed types of public facilities or services to be financed by CFD No. 113 has hereby directed DTA, Inc. (“DTA”) to study the proposed CFD No. 113 and, at or before the time of the public hearing on the establishment of CFD No. 113, file the Report with Council pursuant to the provisions of the Resolution of Intention.

NOW, THEREFORE, DTA does hereby submit the Report.
1778
2 SECTION II

PROJECT DESCRIPTION

City of Fontana April 26, 2024
Community Facilities District No. 113 (The Gardens Phase Two) www.FinanceDTA.com

II PROJECT DESCRIPTION
CFD No. 113 encompasses approximately 36.4 gross acres of land within the City located on the east side of Cypress Avenue south of Duncan Canyon Road and north of Casa Grande Avenue. Of this acreage, approximately 25.3 acres are expected to be developed into uses subject to a Mello-Roos Special Tax1. At buildout, it is currently anticipated that CFD No. 113 will consist of approximately 388 detached condominium units ranging in size from 1,567 to 2,121 square feet.
1 Please note that all capitalized terms used herein, unless otherwise indicated, shall have the meanings defined in the Rate and Method of Apportionment for CFD No. 113. 1779
3 SECTION III

DESCRIPTION AND ESTIMATED

COSTS OF PUBLIC FACILITIES AND

SERVICES

City of Fontana April 26, 2024
Community Facilities District No. 113 (The Gardens Phase Two) www.FinanceDTA.com

III DESCRIPTION AND ESTIMATED COSTS OF PUBLIC FACILITIES AND

SERVICES
A CFD may provide for the purchase, construction, expansion or rehabilitation of any real or tangible property, including public facilities and infrastructure improvements, with an estimated useful life of five (5) years or longer, which is necessary to meet increased demands placed upon local agencies as a result of development or rehabilitation occurring within the CFD. In addition, a CFD may pay in full all amounts necessary to eliminate any fixed special assessment liens or to pay, repay, or defease any obligation to pay for any indebtedness secured by any tax, fee, charge, or assessment levied within the area of the CFD. A CFD may also provide for the financing of certain public services to meet these demands.

A Description of Public Facilities and Services
The type of public facilities proposed to be eligible for funding by CFD No. 113, as identified in the resolution establishing CFD No. 113 (the "Resolution of Formation"), shall consist of those listed below. It is intended that CFD No. 113 will be authorized to finance all or a portion of the costs of any of the following public facilities to be owned and operated by the City and the West Valley Water District (collectively the “Local Agencies”) and such public facilities shall be constructed, whether or not acquired in their completed states, pursuant to the plans and specifications approved by the Local Agencies:

A.1 Facilities
The types of public facilities proposed to be eligible for funding by CFD No. 113 are streets, including grading, paving, curbs and gutters, sidewalks, street signalization and signage, street lights and parkway and landscaping related thereto, sewers, storm drains, flood control facilities, fire protection facilities, police facilities, public facilities, landscaping, library facilities, park and recreational facilities, water distribution, treatment and storage facilities, and land, rights-of-way and easements necessary for any of such facilities.

A.2 Facilities Authorized to be Purchased as Completed Public Facilities The types of public facilities proposed to be purchased as completed facilities by CFD No. 113 are streets, including grading, paving, curbs and gutters, sidewalks, street signalization and signage, street lights and parkway and landscaping related thereto, sewers, storm drains, water distribution, treatment and storage facilities, and land, rights-of-way and easements necessary for any of such facilities.

A.3 Services
The types of public services proposed to be eligible for funding by CFD No. 113 are fire protection and suppression services, maintenance and lighting of parks, parkways, streets, roads and open space, flood and storm protection services and 1780
4 SECTION III

DESCRIPTION AND ESTIMATED

COSTS OF PUBLIC FACILITIES AND

SERVICES

City of Fontana April 26, 2024
Community Facilities District No. 113 (The Gardens Phase Two) www.FinanceDTA.com
maintenance and operation of any real property or other tangible property with an estimated useful life of five or more years that is owned by the City.

A.4 Incidental Expenses
The incidental expenses proposed to be incurred include the following:

The cost of planning and designing public facilities to be financed by CFD No. 113, including the cost of environmental evaluations of those facilities; The costs associated with the creation of CFD No. 113, issuance of CFD No. 113 bonds (the "Bonds"), determination of the amount of taxes, collection of taxes, payment of taxes, or costs otherwise incurred in order to carry out the authorized purposes of CFD No. 113; and
Any other expenses incidental to the construction, completion, and inspection of the authorized work.

B Estimated Costs of Public Facilities and Services
The estimated costs of infrastructure and facilities proposed to be eligible for funding by CFD No. 113 are set forth in the table below. The costs listed below are estimates only and actual costs may differ from those estimates herein. As previously referenced, it is intended that CFD No. 113 will be authorized to finance all or a portion of the costs of any of the following public facilities:
1781
5 SECTION III

DESCRIPTION AND ESTIMATED

COSTS OF PUBLIC FACILITIES AND

SERVICES

City of Fontana April 26, 2024
Community Facilities District No. 113 (The Gardens Phase Two) www.FinanceDTA.com
CFD No. 113 (THE GARDENS PHASE TWO) PUBLIC FACILITIES AMOUNT Acquisition Facilities $25,770,041
[1]

Storm Drain Improvements $7,556,747
Street Improvements $7,213,962
Landscape Improvements $6,414,403
Traffic Signal Improvements $2,894,465
Sewer Improvements $1,445,003
Right-of-Way Acquisition $245,461

Other Public Facilities

$8,753,540
[2]

Water System Capacity Improvements $7,460,557
Circulation Facility Improvements $546,393
Police Facility Improvements $183,136
Public Facility Improvements $139,028
Fire Facility Improvements $63,632
Library Facility Improvements $38,412
Additional Circulation Facility Improvements [3]
$322,382
Advance and Reimbursement Agreement Fee $1,000,000
TOTAL ESTIMATED COSTS $35,523,581
[1] Represents construction costs estimates provided by the Project Developer and subject to review and confirmation. Estimates are inclusive of construction costs contingency for design, planning, engineering and construction management.
[2] Estimated amount of Permit Fees provided by the Project Developer and subject to review and confirmation. [3] Represents additional circulation facilities improvements pursuant to the provisions of the Second Amendment to Development Agreement.

In addition, CFD No. 113 is expected to finance the annual costs to provide fire protection and suppression services, maintenance and lighting of parks, parkways, streets, roads and open space, flood and storm protection services, and maintenance and operation of any real property or other tangible property with an estimated useful life of five or more years that is owned by the City. The Services Special Tax within CFD No. 113 has been established to pay for these public services at approximately $550 per detached condominium unit per year. This amount is subject to change based on the actual need that arises as development progresses within CFD No. 113 and shall also be subject to an annual increase as specified in Section C.2 of the Rate and Method of Apportionment (defined herein).
1782
6 SECTION IV

BONDED INDEBTEDNESS AND

INCIDENTAL EXPENSES

City of Fontana April 26, 2024
Community Facilities District No. 113 (The Gardens Phase Two) www.FinanceDTA.com

IV BONDED INDEBTEDNESS AND INCIDENTAL EXPENSES
A Projected Bond Sales
The maximum authorized bonded indebtedness for CFD No. 113 is $24,000,000. It is anticipated that CFD No. 113 will sell one or more series of Bonds, as determined necessary and appropriate by Council, as development progresses within CFD No. 113.

B Incidental Bond Issuance Expenses to be Included in the Proposed Bonded Indebtedness
Pursuant to Section 53345.3 of the Act, bonded indebtedness may include all costs and estimated costs incidental to, or connected with, the accomplishment of the purpose for which the proposed debt is to be incurred, including, but not limited to, the estimated costs of construction or acquisition of buildings, or both; acquisition of land, rights-of-way, water, sewer, or other capacity or connection fees; satisfaction of contractual obligations relating to expenses or the advancement of funds for expenses existing at the time the bonds are issued, architectural, engineering, inspection, legal, fiscal, and financial consultant fees; bond and other reserve funds; discount fees; interest on any bonds of the district estimated to be due and payable within two years of issuance of the bonds; election costs; and all costs of issuance of the bonds, including, but not limited to, fees for bond counsel, disclosure counsel and the City's general counsel, costs of obtaining credit ratings, bond insurance premiums, fees for letters of credit, and other credit enhancement costs, and printing costs. For the Bonds proposed to be issued by CFD No. 113, the reserve requirement is estimated at approximately seven percent of the principal amount of Bonds, capitalized interest is estimated at approximately six percent of the principal amount of Bonds, and all other incidental bond issuance expenses are estimated at approximately four percent of the principal amount of Bonds. Actual bond issuance expenses, including the amount of Bond funded capitalized interest, may vary from the above estimates.

C Incidental Expenses to be Included in the Annual Levy of Special Taxes Pursuant to Section 53340 of the Act, the proceeds of any special tax may only be used to pay, in whole or part, the costs of providing public facilities, services and incidental expenses. As defined by the Act, incidental expenses include, but are not limited to, the costs of planning and designing public facilities to be financed, including the costs of environmental evaluations of those public facilities; the costs associated with the creation of the district, issuance of bonds, determination of the amount of taxes, collection of taxes, payment of taxes, or costs otherwise incurred in order to carry out the authorized purposes of the district; any other expenses incidental to the construction, completion, and inspection of the authorized work; and the costs associated with the retirement of existing bonded indebtedness. While the actual costs of administering CFD No. 113 may vary, it is anticipated that the amount of Special Taxes which can be collected will be sufficient to fund at least $40,000 in annual administrative expenses, which shall also be subject to an annual increase of two (2%) annually.
1783
7 SECTION V

RATE AND METHOD OF

APPORTIONMENT

City of Fontana April 26, 2024
Community Facilities District No. 113 (The Gardens Phase Two) www.FinanceDTA.com

V RATE AND METHOD OF APPORTIONMENT
All of the property located within CFD No. 113, unless exempted by law or by the Rate and Method of Apportionment (defined below), shall be taxed for the purpose of funding public facilities and services authorized to be financed by CFD No. 113. Pursuant to Section 53325.3 of the Act, the tax imposed “is a special tax and not a special assessment, and there is no requirement that the tax be apportioned on the basis of benefit to any property.” The special tax “may be based on benefit received by parcels of real property, the costs of making authorized facilities or authorized services available to each parcel or other reasonable basis as determined by the legislative body,” although the special tax may not be apportioned on an ad valorem basis pursuant to Article XIIIA of the California Constitution.

The rate and method of apportionment of the special tax (the "Rate and Method of Apportionment") proposed to be levied within CFD No. 113 is described in Exhibit C to the Resolution of Intention. This proposed Rate and Method of Apportionment, also provided herein as Appendix A, provides information sufficient to allow each property owner within CFD No. 113 to estimate the maximum annual Special Tax he or she will be required to pay.

Sections A through D below provide additional information on the Rate and Method of Apportionment.

A Explanation for Special Tax Apportionment
When a community facilities district is formed, a special tax may be levied on each parcel of taxable property within the community facilities district to pay for the construction, acquisition and rehabilitation of public facilities, to pay for authorized services or to repay bonded indebtedness or other related expenses incurred by a community facilities district.

This special tax must be apportioned in a reasonable manner; however, the tax may not be apportioned on an ad valorem basis.

When more than one type of land use is present within a community facilities district, several criteria may be considered when apportioning the special tax. Generally, criteria based on building square footage, acreage, and land use are selected, and categories based on such criteria are established to differentiate between parcels of property. These categories are a direct result of the projected product mix and are reflective of the proposed land use types within that community facilities district. Specific special tax levels are assigned to each land use class, with all parcels within a land use class assigned the same special tax rate.

The Act does not require that special taxes be apportioned to individual parcels based on benefit received. However, in order to ensure fairness and equity, benefit principles have been incorporated in establishing the Special Tax rates for CFD No. 113.

The major assumption inherent in the Special Tax rates set forth in the Rate and Method of 1784
8 SECTION V

RATE AND METHOD OF

APPORTIONMENT

City of Fontana April 26, 2024
Community Facilities District No. 113 (The Gardens Phase Two) www.FinanceDTA.com
Apportionment is that the level of benefit received from the proposed public facilities and services is a function of land use and/or product type. This assumption is borne out through an examination of commonly accepted statistical measures for public facility usage.

For example, in measuring average weekday vehicle trip-ends, the Institute of Transportation Engineer's Trip Generation manual identifies land use as the primary determinant of trip-end magnitude. Larger residential dwelling units typically generate a greater number of trip-ends than do smaller residential dwelling units, and therefore, will tend to receive more benefit from road grading, road landscaping and road improvements.

Drainage and flood control requirements generally vary with the amount of impervious ground cover per parcel. It follows that large homes situated on large lots have more impervious ground cover which will create more drainage flows than that of smaller homes situated on smaller lots.

In addition, sewer treatment costs are based on plant capacity to treat Biochemical Oxygen Demand (“BOD”), Suspended Solids (“SS”), and the flow rate. Other variables for water and sewer requirements include storage and fire flow requirements, as well as the number of bathrooms and fixture units in the home and the population of the household, which tends to vary directly with the size of the dwelling unit.

Therefore, Special Tax rates have been established for residential and non-residential land use classes for CFD No. 113. In addition, in order to ensure fairness, the Special Tax rates are uniformly applied within each land use class. The Special Tax for a parcel of Residential Property within CFD No. 113 will vary directly based on the location and the amount of Residential Floor Area associated with each such parcel. The Special Tax for Non-Residential Property, if any, in CFD No. 113 will vary directly with the acreage of such parcel.

Based on the types of public facilities and services that are proposed for CFD No. 113 and the factors described above, the Special Taxes assigned to Developed Properties are generally proportionate to the relative benefits received by them, and, accordingly, the Special Taxes in CFD No. 113 can be considered fair and reasonable.

B Maximum Facilities Special Tax
Table 1 within the Rate and Method of Apportionment lists the Assigned Facilities Special Tax that may be levied on each Assessor’s Parcel classified as Residential Property within CFD No. 113 to fund the Special Tax Requirement for Facilities. In addition, the Assigned Facilities Special Tax that may be levied on each Assessor’s Parcel classified as NonResidential Property shall range from $51,370 per Acre to $59,970 per Acre, as identified in Table 2 within the Rate and Method of Apportionment, based on the location of such Assessor’s Parcel. The Facilities Special Tax for an Assessor’s Parcel of Residential Property or Non-Residential Property cannot exceed the rates shown in such Table 1 or Table 2, 1785
9 SECTION V

RATE AND METHOD OF

APPORTIONMENT

City of Fontana April 26, 2024
Community Facilities District No. 113 (The Gardens Phase Two) www.FinanceDTA.com
except when the Backup Facilities Special Tax is applied as discussed in Section C below.

Furthermore, the Maximum Facilities Special Tax for each Assessor’s Parcel of Undeveloped Property, Taxable Public Property, and Taxable Property Owner Association Property shall range from $60,450 per Acre to $70,560 per Acre, as identified in Table 4 within the Rate and Method of Apportionment, based on the location of such Assessor’s Parcel.

C Backup Facilities Special Tax
Pursuant to the Rate and Method of Apportionment, the Maximum Facilities Special Tax for each Assessor’s Parcel classified as Developed Property shall be the greater of (i) the amount derived by application of the Assigned Facilities Special Tax or (ii) the amount derived by application of the Backup Facilities Special Tax. The Backup Facilities Special Tax for an Assessor's Parcel of Developed Property shall range from $60,450 per Acre to $70,560 per Acre, as identified in Table 3 within the Rate and Method of Apportionment, based on the location of such Assessor’s Parcel, or such lower amount as determined pursuant to Section C.1.a.(4) of the Rate and Method of Apportionment.

D Maximum Services Special Tax
Table 5 within the Rate and Method of Apportionment lists the Fiscal Year 2023-2024 Maximum Services Special Tax that may be levied against Developed Property within CFD No. 113 to fund the Special Tax Requirement for Services. On each July 1, commencing July 1, 2024, the Maximum Services Special Tax shall be increased by an amount equal to two percent (2%) of the amount in effect for the previous Fiscal Year. No Services Special Tax shall be levied on Undeveloped Property, Taxable Public Property, Taxable Property Owner Association Property, Public Property or Property Owner Association Property in CFD No. 113. Refer to Section C.2 of the Rate and Method of Apportionment for further details on the Services Special Tax.

E Accuracy of Information
In order to establish the Maximum Special Tax rates for CFD No. 113 as set forth in the Rate and Method of Apportionment, DTA has relied on information including, but not limited to, absorption, land-use types, building square footage, and net taxable acreage provided by others. DTA has not independently verified such data and disclaims responsibility for the impact of inaccurate data, if any, on the Rate and Method of Apportionment for CFD No. 113, including the inability to meet the financial obligations within CFD No. 113. 1786
10 SECTION VI

BOUNDARIES OF THE CFD

City of Fontana April 26, 2024
Community Facilities District No. 113 (The Gardens Phase Two) www.FinanceDTA.com

VI BOUNDARIES OF THE CFD
The boundaries of CFD No. 113 include all land on which the Special Taxes may be levied.

A reduced scale map showing the boundaries of CFD No. 113 is provided herein as Appendix B. A full-scale map is on file with the City Clerk of the City and was recorded on April 17, 2024, in Book 91 of Maps of Assessment and Community Facilities Districts at Page 56, as Document No. 2024-0089360 in the office of the County Recorder in the County of San Bernardino.
1787
11 SECTION VII

GENERAL TERMS AND

CONDITIONS

City of Fontana April 26, 2024
Community Facilities District No. 113 (The Gardens Phase Two) www.FinanceDTA.com

VII GENERAL TERMS AND CONDITIONS
A Substitution of Facilities and Services
The descriptions of the public facilities and services, as set forth herein, are general in their nature. The Local Agencies will determine the final nature, location, and costs of facilities and services upon the preparation of final plans and specifications. The final plans may show substitutes, in lieu of modifications to the proposed work in order to accomplish the work of improvement, and any such substitution shall not be a change or modification in the proceedings as long as the public facilities and services provide a service substantially similar to that as set forth in this Report.

B Appeals and Interpretations
Pursuant to Section G of the Rate and Method of Apportionment, any landowner or resident who feels that the amount of the Special Tax levied on his/her Assessor’s Parcel is in error may submit a written appeal to the CFD Administrator, provided that the appellant is current in his/her payment of Special Taxes. During the pendency of an appeal, all Special Taxes previously levied must be paid on or before the payment date established when the levy was made. The CFD Administrator shall review the appeal, meet with the appellant if the CFD Administrator deems necessary, and advise the appellant of its determination. If the CFD Administrator agrees with the appellant, a cash refund shall not be made (except for the last year of levy), but the amount of the Special Tax levied shall be appropriately modified through an adjustment to the Special Tax levy in the following Fiscal Year. If the CFD Administrator disagrees with the appellant and the appellant is dissatisfied with the determination, the appellant then has 30 days in which to appeal to the Council by filing a written notice of appeal with the City Clerk, provided that the appellant is current in his/her payment of Special Taxes. This second appeal must specify the reasons for its disagreement with the CFD Administrator's determination.

C Prepayment of Special Tax
The Facilities Special Tax applicable to an Assessor’s Parcel in CFD No. 113 may be prepaid according to the prepayment provisions identified in Section H of the Rate and Method of Apportionment. The Services Special Tax may not be prepaid. 1788

APPENDIX A
City of Fontana
Community Facilities District No. 113
(The Gardens Phase Two)

RATE AND METHOD OF

APPORTIONMENT

1789
City of Fontana March 20, 2024
Community Facilities District No. 113 (The Gardens Phase Two) Page 1

All of the real property in CFD No. 113, 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. DEFINITIONS
The terms hereinafter set forth have the following meanings:
"Acre" or "Acreage" means the land area expressed in acres of an Assessor’s Parcel as shown on an Assessor’s Parcel Map, or if the land area is not shown on an Assessor’s Parcel Map, the land area shown on the applicable final map, parcel map, condominium plan, or other recorded County map or the land area calculated to the reasonable satisfaction of the CFD Administrator using the boundaries set forth on such map or plan. For residential dwelling units within a condominium plan, the Acres applicable to each residential dwelling unit shall be determined by dividing (i) the Acres of the underlying lot or parcel on which the residential dwelling unit is constructed or to be constructed, by (ii) the total number of residential dwelling units constructed or to be constructed on such lot or parcel. 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, Part 1, Division 2 of Title 5 (commencing with Section 53311) of the California Government Code.
"Administrative Expenses" means the following actual or reasonably estimated costs directly related to the administration of CFD No. 113, including but not limited to: the costs of computing the Special Taxes and preparing the annual Special Tax collection schedules (whether by the City or designee thereof or both); the costs of collecting the Special Taxes (whether by the County or otherwise); the costs of remitting the Special Taxes to the Trustee; the costs of the Trustee (including its legal counsel) in the discharge of the duties required of it under the Indenture; the costs to the City, CFD No. 113 or any designee thereof of complying with arbitrage rebate requirements with respect to the Special Tax and CFD No. 113 Bonds; the costs to the City, CFD No. 113 or any designee thereof of complying with disclosure requirements of the City, CFD No. 113 or obligated persons associated with applicable federal and state securities laws and the Act; the costs associated with preparing Special Tax disclosure statements and responding to public inquiries regarding the Special Taxes; the costs of the City, CFD No. 113, or any designee thereof related to the reduction of the Assigned Facilities Special Tax and Backup Facilities Special Tax in accordance with Section C.1 herein; the costs of the City, CFD No. 113 or any designee thereof related to an appeal of the Special Tax; and the City’s annual administration fees and third party expenses related to CFD No. 113 Bonds. Administrative Expenses shall also include amounts estimated or advanced by the City or CFD No. 113 for any other administrative purposes of CFD No. 113, including attorney’s fees and other costs related to commencing and pursuing to completion any foreclosure of delinquent Special Taxes. 1790
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Community Facilities District No. 113 (The Gardens Phase Two) Page 2 "Assessor" means the Assessor of the County.
"Assessor's Parcel" means a lot or parcel to which an Assessor’s parcel number is assigned as determined from an Assessor’s Parcel Map or the applicable assessment roll. "Assessor's Parcel Map" means an official map of the Assessor designating parcels by Assessor’s Parcel number.
"Assigned Facilities Special Tax" means the applicable Facilities Special Tax for (i) Residential Property as determined in accordance with Section C.1.a.(2) herein, and (ii) NonResidential Property as determined in accordance with Section C.1.a.(3) herein. "Assigned Services Special Tax" means the Services Special Tax, determined in accordance with Section C.2.b herein, that can be levied in any Fiscal Year on any Assessor’s Parcel of Developed Property.
"Authorized Facilities" means those facilities eligible to be funded by CFD No. 113. "Authorized Services" means those services eligible to be funded by CFD No. 113 in accordance with the Act, namely, fire protection and suppression services, maintenance and lighting of parks, parkways, streets, roads and open space, flood and storm protection services and maintenance and operation of any real property or other tangible property with an estimated useful life of five or more years that is owned by the City. "Backup Facilities Special Tax" means the Facilities Special Tax applicable to each Assessor's Parcel of Developed Property, as determined in accordance with Section C.1.a.(4) herein. "Buildout" means, for CFD No. 113, that all expected building permits for residential dwelling units and/or non-residential development to be constructed within CFD No. 113 have been issued, as determined by the CFD Administrator.
"CFD Administrator" means an official of the City, or designee thereof, responsible for determining the Special Tax Requirement for Facilities and the Special Tax Requirement for Services, providing for the levy and collection of the Special Taxes, and performing other duties as set forth herein.
"CFD No. 113" means City of Fontana Community Facilities District No. 113 (The Gardens Phase Two).
"CFD No. 113 Bonds" means any bonds or other debt (as defined in Section 53317(d) of the Act), whether in one or more series, issued by CFD No. 113 and secured by the Facilities Special Tax levy on property within the boundaries of CFD No. 113 under the Act. "City" means the City of Fontana, California.
"Contractual Impositions" means (a) a voluntary contractual assessment established and levied on an Assessor’s Parcel pursuant to Chapter 29 of Part 3 of Division 7 of the California Streets and Highways Code (commencing with Section 5898.10 et seq.), as amended from time to time, (b) a special tax established and levied on an Assessor’s Parcel pursuant to Section 53328.1 of the California Government Code and related provisions of the Act, as amended from time to time, and (c) any other fee, charge, tax or assessment established and levied on an individual Assessor’s Parcel pursuant to a contractual agreement or other voluntary consent by the owner thereof.
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Community Facilities District No. 113 (The Gardens Phase Two) Page 3 "Council" means the City Council of the City acting as the legislative body of CFD No. 113. "County" means the County of San Bernardino.
"Developed Property" means, for each Fiscal Year, (i) with respect to the Facilities Special Tax, all Taxable Property, exclusive of Taxable Public Property and Taxable Property Owner Association Property, for which a building permit for new construction, other than the construction of a garage, parking lot, or parking structure, was issued after January 1, 2024 and on or before May 1 of the Fiscal Year preceding the Fiscal Year for which the Facilities Special Taxes are being levied, and (ii) with respect to the Services Special Tax, all Taxable Property, exclusive of Taxable Public Property and Taxable Property Owner Association Property, (a) for which the Final Residential Subdivision was recorded prior to the Fiscal Year for which the Services Special Taxes are being levied, or (b) for which a building permit has been issued with respect to Non-Residential Property on or before May 1 of the Fiscal Year preceding the Fiscal Year for which the Services Special Taxes are being levied. "Facilities Special Tax" means the special tax to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property within CFD No. 113 to fund the Special Tax Requirement for Facilities, as set forth in Section C.1 herein.
"Final Residential Subdivision" means a Final Subdivision that creates individual lots for which building permits may be issued for residential dwelling units without further subdivision of such property.
"Final Subdivision" means (i) a subdivision of property by recordation of a final map, parcel map, or lot line adjustment approved by the City pursuant to the Subdivision Map Act (California Government Code Section 66410 et seq.) that creates individual lots or parcels for which building permits may be issued, or (ii) for condominiums, a final map approved by the City and a condominium plan recorded pursuant to California Civil Code Section 4285 that creates an individual lot(s) for which a building permit(s) may be issued without further subdivision. The term "Final Subdivision" shall not include any Assessor’s Parcel Map or subdivision map or portion thereof that does not create individual lots for which a building permit may be issued, including Assessor’s Parcels that are designated as remainder parcels.

Notwithstanding the above, a condominium plan for which one or more building permits have been issued, but no individual lots have been created for such building permits, shall be considered a Final Subdivision, and the portion of the condominium plan for which building permits have been issued shall be defined as Developed Property. "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 CFD No. 113 Bonds are issued, as modified, amended and/or supplemented from time to time.
"Land Use Class" means any of the classes listed in Table 1, Table 5, or Table 6 herein. "Lower Income Households Welfare Exemption Property" means, for each Fiscal Year, an Assessor’s Parcel within the boundaries of CFD No. 113 that is subject to a welfare exemption under subdivision (g) of Section 214 of the California Revenue and Taxation Code (or any successor statute), as indicated in the County’s assessment roll finalized as of the last preceding January 1.
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Community Facilities District No. 113 (The Gardens Phase Two) Page 4 "Maximum Facilities Special Tax" means the maximum Facilities Special Tax, determined in accordance with Section C.1 herein, that can be levied in any Fiscal Year on any Assessor’s Parcel of Taxable Property.
"Maximum Services Special Tax" means the maximum Services Special Tax, determined in accordance with Section C.2 herein, that can be levied in any Fiscal Year on any Assessor’s Parcel of Developed Property.
"Minimum Sale Price" means the minimum price at which any parcel in a given Land Use Class has sold or is expected to be sold in a normal marketing environment and shall not include prices for such parcels that are sold at a discount to expected sales prices for the purpose of stimulating the initial sales activity with respect to such Land Use Class. "Non-Residential Property" means all Assessor’s Parcels of Developed Property for which a building permit(s) has been issued by the City permitting the construction of one or more nonresidential structures or facilities. "Outstanding Bonds" means all CFD No. 113 Bonds which are outstanding under the Indenture.
"Planning Area" means an area designated with the letters "P.A." as shown on Exhibit B. "Price Point Consultant" means any consultant or firm of such consultants selected by CFD No. 113 that (a) has substantial experience in performing price point studies for residential dwelling units within community facilities districts or otherwise estimating or confirming pricing for residential dwelling units in community facilities districts, (b) has recognized expertise in analyzing economic and real estate data that relates to the pricing of residential dwelling units in community facilities districts, (c) is in fact independent and not under the control of CFD No. 113 or the City, (d) does not have any substantial interest, direct or indirect, with or in (i) CFD No. 113, (ii) the City, (iii) any owner of real property in CFD No. 113, or (iv) any real property in CFD No. 113, and (e) is not connected with CFD No. 113 or the City as an officer or employee thereof, but who may be regularly retained to make reports to CFD No. 113 or the City.
"Price Point Study" means a price point study or a letter updating a previous price point study prepared by the Price Point Consultant pursuant to Section C herein. "Property Owner Association Property" means, for each Fiscal Year, (i) any property within the boundaries of CFD No. 113 for which the owner of record, as determined from the County’s assessment roll for the Fiscal Year in which the Special Tax is being levied, is a property owner’s association, including any master or sub-association, or (ii) any property located in a Final Subdivision that was recorded as of the January 1 preceding the Fiscal Year in which the Special Tax is being levied and which, as determined from such Final Subdivision, is or will be open space, a common area recreation facility, or a private street. Notwithstanding the foregoing, any property previously classified as Developed Property and subsequently owned in fee or by easement, or dedicated to, a property owner association, including any master or subassociation, shall remain classified as Developed Property. "Proportionately" means that the ratio of the actual Facilities Special Tax levy to the Assigned Facilities Special Tax is equal for all Assessor’s Parcels of Developed Property, and that the ratio of the actual Services Special Tax levy to the Assigned Services Special Tax is equal for all Assessor’s Parcels of Developed Property. For Undeveloped Property, "Proportionately" means 1793
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Community Facilities District No. 113 (The Gardens Phase Two) Page 5 that the ratio of the actual Facilities Special Tax levy per Acre to the Maximum Facilities Special Tax per Acre is equal for all Assessor’s Parcels of Undeveloped Property. The term "Proportionately" shall similarly be applied to other categories of Taxable Property as listed in Section D herein.
"Public Property" means, for each Fiscal Year, any property within the boundaries of CFD No. 113 that is (i) owned by, irrevocably offered or dedicated to the federal government, the State, the County, the City, or any local government or other public agency, provided, however, that any property leased by a public agency to a private entity and subject to taxation under Section 53340.1 of the Act shall be taxed and classified according to its use; or (ii) encumbered by a public utility easement making impractical its use for any purpose other than that set forth in the easement.
"Rate and Method of Apportionment" means this Rate and Method of Apportionment for CFD No. 113.
"Residential Floor Area" means all of the square footage of living area within the perimeter of a residential structure, not including any carport, walkway, garage, overhang, patio, enclosed patio, or similar area. The determination of Residential Floor Area for an Assessor’s Parcel shall be as set forth in the building permit(s) issued for such Assessor’s Parcel and/or as set forth in the appropriate records kept by the Building and Safety Department of the City, or other applicable City department, as determined by the CFD Administrator. "Residential Property" means all Assessor’s Parcels of Developed Property for which a building permit(s) has been issued by the City permitting the construction thereon of one or more residential dwelling units.
"Services Special Tax" means the special tax to be levied in each Fiscal Year on each Assessor’s Parcel of Developed Property within CFD No. 113 to fund the Special Tax Requirement for Services, as set forth in Section C.2 herein. "Special Tax" or "Special Taxes" means the Facilities Special Tax and/or Services Special Tax, as applicable.
"Special Tax Requirement for Facilities" means, for any Fiscal Year, that amount required, after taking into account available amounts held in the funds and accounts under the Indenture, for the following items: (i) debt service on all Outstanding Bonds due in the calendar year commencing in such Fiscal Year; (ii) periodic costs with respect to the CFD No. 113 Bonds, including but not limited to, costs of credit enhancement and federal rebate payments due in the calendar year commencing in such Fiscal Year; (iii) pay all or a portion of Administrative Expenses; (iv) any amounts required to establish or replenish any reserve funds for all Outstanding Bonds; (v) without duplicating any amounts described in clause (iv), above, reasonably anticipated Facilities Special Tax delinquencies based on the delinquency rate for the Facilities Special Tax in the previous Fiscal Year, as said levy for delinquencies shall be limited by the Act; and (vi) pay directly for the acquisition or construction of Authorized Facilities, provided that the inclusion of such amount does not increase the Facilities Special Tax levy beyond the first step in Section D.1 herein.
"Special Tax Requirement for Services" means that amount required in any Fiscal Year for CFD No. 113 to (i) pay directly for the Authorized Services; (ii) pay Administrative Expenses not funded through the Special Tax Requirement for Facilities as determined by the CFD 1794
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Community Facilities District No. 113 (The Gardens Phase Two) Page 6 Administrator; (iii) pay for reasonably anticipated Services Special Tax delinquencies based on the delinquency rate for the Services Special Tax levy in the previous Fiscal Year; less (iv) a credit for funds available to reduce the annual Services Special Tax levy, as determined by the CFD Administrator, so long as the amount required is not less than zero. "State" means the State of California.
"Taxable Property" means all of the Assessor's Parcels within the boundaries of CFD No. 113 which are not exempt from the Special Tax pursuant to applicable law or Section E herein. "Taxable Property Owner Association Property" means all Assessor’s Parcels of Property Owner Association Property that are not exempt pursuant to Section E herein. "Taxable Public Property" means all Assessor’s Parcels of Public Property that are not exempt pursuant to Section E herein.
"Total Tax Burden" means, for a parcel of residential property within a Land Use Class, for the Fiscal Year in which Total Tax Burden is being calculated, the sum of (a) the Assigned Facilities Special Tax for such Fiscal Year, plus (b) the Assigned Services Special Tax for such Fiscal Year, plus (c) the ad valorem property taxes, special assessments, special taxes for any overlapping community facilities districts, and any other governmental fees, charges (other than fees or charges for services such as sewer and trash), taxes and assessments (which, for purposes of clarity, do not include Contractual Impositions) collected by the County on ad valorem tax bills and that the CFD Administrator estimates would be levied or imposed on such residential property in such Fiscal Year if the residential dwelling unit thereon or therein had been completed and sold, and was subject to such fees, charges, taxes and assessments in such Fiscal Year.
"Trustee" means the trustee or fiscal agent under the Indenture. "Undeveloped Property" means, for each Fiscal Year, all Taxable Property not classified as Developed Property, Taxable Public Property or Taxable Property Owner Association Property.

Please refer to additional definitions in Section H herein relating to the Prepayment of Facilities Special Tax.

C. MAXIMUM SPECIAL TAX RATE

1. Facilities Special Tax
At least 30 days prior to the issuance of the first series of CFD No. 113 Bonds, the Assigned Facilities Special Tax for Residential Property (set forth in Table 1 below) shall be analyzed in accordance with and subject to the conditions set forth in this Section C. At such time, the CFD Administrator shall request the Price Point Consultant to prepare a Price Point Study setting forth the Minimum Sale Price of residential property within each Land Use Class. If based upon such Price Point Study the CFD Administrator calculates that the Total Tax Burden applicable to one 1795
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Community Facilities District No. 113 (The Gardens Phase Two) Page 7 or more Land Use Classes of residential property constructed or to be constructed within CFD No. 113 shall exceed 1.95% of the Minimum Sale Price of such residential property constructed or to be constructed within CFD No. 113, the CFD Administrator shall reduce the Assigned Facilities Special Tax to the extent necessary to cause the Total Tax Burden that shall apply to residential property within such Land Use Class(es) to not exceed 1.95% of the Minimum Sale Price of such residential property. Each Assigned Facilities Special Tax reduction for a Land Use Class shall be calculated separately, and it shall not be required that such reduction be proportionate among Land Use Classes. In connection with any reduction in the Assigned Facilities Special Tax for Residential Property, the CFD Administrator shall also reduce the Assigned Facilities Special Tax for Non-Residential in accordance with Section C.1.a.(3) herein, and the Backup Facilities Special Tax in accordance with Section C.1.a.(4) herein. Upon determining the reductions, if any, in the Assigned Facilities Special Tax and Backup Facilities Special Tax required pursuant to this Section C, the CFD Administrator shall complete the Certificate to Amend Facilities Special Tax substantially in the form attached hereto as Exhibit A (the “Certificate to Amend”) and shall execute such completed Certificate to Amend and shall deliver such Certificate to Amend to CFD No. 113. Upon receipt thereof, if in satisfactory form, CFD No. 113 shall execute such Certificate to Amend. The reduced Assigned Facilities Special Tax and Backup Facilities Special Tax specified in such Certificate to Amend shall become effective upon the execution of such Certificate to Amend by CFD No. 113. The Assigned Facilities Special Tax and Backup Facilities Special Tax reductions permitted pursuant to this Section C shall be reflected in an amended notice of Special Tax lien which CFD No. 113 shall cause to be recorded with the San Bernardino County Recorder as soon as practicable after execution of the Certificate to Amend by CFD No. 113. If based upon such Price Point Study the CFD Administrator calculates that the Total Tax Burden applicable to each Land Use Class of residential property constructed or to be constructed within CFD No. 113 does not exceed

1.95% of the Minimum Sale Price of each such Land Use Class of residential property constructed or to be constructed within CFD No. 113, then there shall be no reduction in the Assigned Facilities Special Tax, nor shall there be a reduction in the Backup Facilities Special Tax.
a. Developed Property
(1). Maximum Facilities Special Tax
The Maximum Facilities Special Tax for each Assessor's Parcel classified as Developed Property shall be the greater of (i) the amount derived by application of the Assigned Facilities Special Tax or (ii) the amount derived by application of the Backup Facilities Special Tax.
(2). Assigned Facilities Special Tax for Residential Property Residential Property shall be assigned to Land Use Classes 1 through 15 as listed in Table 1 below based on the Planning Area, Description, and the Residential Floor Area associated with each such residential dwelling unit. The Assigned Facilities Special Tax that shall be levied in any Fiscal Year for each Land Use Class is shown below in Table 1 and shall not be subject to escalation.
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Community Facilities District No. 113 (The Gardens Phase Two) Page 8 Table 1
Assigned Facilities Special Tax for Residential Property City of Fontana CFD No. 113 (The Gardens Phase Two)
Land
Use
Class
Planning
Area Description
Residential Floor
Area (square feet)
Assigned
Facilities
Special Tax
1 Planning
Area 1
Residential Property 2,100 or greater $4,137 per unit
2 Residential Property 1,950 to less than 2,100 $3,956 per unit 3 Residential Property 1,800 to less than 1,950 $3,775 per unit 4 Residential Property 1,650 to less than 1,800 $3,554 per unit 5 Residential Property Less than 1,650 $3,344 per unit
6 Planning
Area 2
Residential Property 2,100 or greater $3,946 per unit
7 Residential Property 1,950 to less than 2,100 $3,759 per unit 8 Residential Property 1,800 to less than 1,950 $3,572 per unit 9 Residential Property 1,650 to less than 1,800 $3,385 per unit 10 Residential Property Less than 1,650 $3,198 per unit 11 Planning
Areas
3 & 4
Residential Property 2,225 or greater $4,604 per unit
12 Residential Property 2,075 to less than 2,225 $4,259 per unit 13 Residential Property 1,925 to less than 2,075 $3,914 per unit 14 Residential Property 1,775 to less than 1,925 $3,699 per unit 15 Residential Property Less than 1,775 $3,549 per unit (3). Assigned Facilities Special Tax for Non-Residential Property The Assigned Facilities Special Tax for an Assessor’s Parcel of Non-Residential Property within a Planning Area shall equal the lesser of (a) the Assigned Facilities Special Tax applicable for such Planning Area set forth in Table 2 below (as such Assigned Facilities Special Tax shall not be subject to escalation), or (b) in connection with any reduction in the Assigned Facilities Special Tax for Residential Property as set forth in Section C.1 herein, the amount per Acre calculated for each Planning Area pursuant to the formula below:

RAFST = AFST  ATP
These terms have the following meaning:

RAFST = the reduced Assigned Facilities Special Tax for Non-Residential Property within a Planning Area.

ATP = The sum of the Acreage of all Taxable Property within a Final Subdivision (assuming Buildout of CFD No. 113) within such Planning Area (after excluding 1797
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Community Facilities District No. 113 (The Gardens Phase Two) Page 9 Public Property and Property Owner Association Property as set forth in Section E.1 herein).

RBFST = AFST  ATPX
These terms have the following meaning:

RBFST = the reduced Backup Facilities Special Tax for Developed Property within a Planning Area.

Table 3
Backup Facilities Special Tax for Developed Property
City of Fontana CFD No. 113 (The Gardens Phase Two)
Planning Area
Backup
Facilities
Special Tax
P.A. 1 $69,540 per Acre
P.A. 2 $70,560 per Acre
P.A. 3 $60,450 per Acre
P.A. 4 $61,530 per Acre
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Community Facilities District No. 113 (The Gardens Phase Two) Page 10 Furthermore, all Assessors’ Parcels within CFD No. 113 shall be relieved simultaneously and permanently from the obligation to pay and disclose the Backup Facilities Special Tax if the CFD Administrator calculates that (i) the annual debt service required for the Outstanding Bonds, when compared to the Assigned Facilities Special Tax that shall be levied against all Assessors’ Parcels of Developed Property in CFD No. 113 results in 110% debt service coverage (i.e., the Assigned Facilities Special Tax that shall be levied against all Developed Property in CFD No. 113 in each remaining Fiscal Year based on the then existing development is at least equal to the sum of (a) 1.10 times the debt service necessary to support the remaining Outstanding Bonds in each corresponding Fiscal Year, and (b) Administrative Expenses), and (ii) all authorized CFD No. 113 Bonds have already been issued or the Council has covenanted that it shall not issue any additional CFD No. 113 Bonds (except refunding bonds) to be supported by the Facilities Special Tax in CFD No. 113.
(5). Multiple Land Uses
In some instances an Assessor’s Parcel may contain both Developed Property and Undeveloped Property. In such cases, the Acreage of the Assessor’s Parcel shall be allocated between Developed Property and Undeveloped Property based on the portion of the Assessor’s Parcel for which building permits had been issued prior to May 1 of the prior Fiscal Year and the portion of the Assessor’s Parcel for which building permits had not been issued prior to May 1 of the prior Fiscal Year.

Table 4
Maximum Facilities Special Tax for Undeveloped Property, Taxable Public Property and Taxable Property Owner Association Property City of Fontana CFD No. 113 (The Gardens Phase Two)
Planning Area
Maximum
Facilities
Special Tax
P.A. 1 $69,540 per Acre
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Community Facilities District No. 113 (The Gardens Phase Two) Page 11 Planning Area
Maximum
Facilities
Special Tax
P.A. 2 $70,560 per Acre
P.A. 3 $60,450 per Acre
P.A. 4 $61,530 per Acre

Table 6
Assigned Services Special Tax for Developed Property
City of Fontana CFD No. 113 (The Gardens Phase Two)
Fiscal Year 2023-2024
Land
Use
Class Description
Assigned Services
Special Tax
1 Final Residential Subdivision $550 per unit
2 Non-Residential Property $8,450 per Acre
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Community Facilities District No. 113 (The Gardens Phase Two) Page 12 c. Increase in the Maximum Services Special Tax
The Maximum Services Special Tax in Table 5 above shall be applicable for Fiscal Year 2023-2024, and shall increase thereafter, commencing on July 1, 2024, and on each July 1 thereafter by an amount equal to two percent (2%) of the amount in effect for the previous Fiscal Year.
d. Increase in the Assigned Services Special Tax
The Assigned Services Special Tax in Table 6 above shall be applicable for Fiscal Year 2023-2024, and shall increase thereafter, commencing on July 1, 2024, and on each July 1 thereafter in an amount estimated to fund the Special Tax Requirement for Services for the Fiscal Year commencing on such July 1. However, in no case shall the Assigned Services Special Tax for an Assessor’s Parcel of Developed Property exceed the applicable Maximum Services Special Tax for such Assessor’s Parcel of Developed Property in any Fiscal Year.
e. Multiple Land Uses
In some instances an Assessor’s Parcel of Developed Property may contain more than one Land Use Class. In such cases, the Acreage of Developed Property shall be allocated between Residential Property and Non-Residential Property based on the amount of Acreage designated for each land use as determined by reference to the site plan approved for such Assessor's Parcel. The Maximum Services Special Tax that can be levied on such Assessor’s Parcel shall be the sum of the Maximum Services Special Tax that can be levied on each type of property located on that Assessor’s Parcel. The CFD Administrator’s allocation to each type of property shall be final.

D. METHOD OF APPORTIONMENT OF THE SPECIAL TAX

First: The Facilities Special Tax shall be levied on each Assessor’s Parcel of Developed Property in an amount equal to 100% of the applicable Assigned Facilities Special Tax; Second: If additional monies are needed to satisfy the Special Tax Requirement for Facilities after the first step has been completed, the Facilities Special Tax shall be levied Proportionately on each Assessor's Parcel of Undeveloped Property at up to 100% of the Maximum Facilities Special Tax for Undeveloped Property;
Third: If additional monies are needed to satisfy the Special Tax Requirement for Facilities after the first two steps have been completed, then the levy of the Facilities Special Tax on each Assessor's Parcel of Developed Property whose Maximum Facilities Special Tax is determined through the application of the Backup Facilities Special Tax shall be increased in equal percentages from the Assigned Facilities Special Tax up to the Maximum Facilities Special Tax for each such Assessor's Parcel;
Fourth: If additional monies are needed to satisfy the Special Tax Requirement for Facilities after the first three steps have been completed, then the Facilities Special Tax shall be levied Proportionately on each Assessor’s Parcel of Taxable Public Property and Taxable Property 1801
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Community Facilities District No. 113 (The Gardens Phase Two) Page 13 Owner Association Property at up to 100% of the Maximum Facilities Special Tax for Taxable Public Property and Taxable Property Owner Association Property, as needed to satisfy the Special Tax Requirement for Facilities.

E. EXEMPTIONS

1. Facilities Special Tax
No Facilities Special Tax shall be levied on up to the applicable Acreage limit of Public Property and/or Property Owner Association Property established for each Planning Area as set forth in Table 7 below. Tax-exempt status shall be assigned by the CFD Administrator in the chronological order in which property within a Planning Area becomes Public Property or Property Owner Association Property. However, should an Assessor’s Parcel no longer be classified as Public Property or Property Owner Association Property, it shall, from that point forward, be subject to the Facilities Special Tax.
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Community Facilities District No. 113 (The Gardens Phase Two) Page 14 Table 7
Exempt Acreage Limits
City of Fontana CFD No. 113 (The Gardens Phase Two)
Planning Area
Exempt
Acreage Limit
P.A. 1 3.36 Acres
P.A. 2 2.00 Acres
P.A. 3 2.66 Acres
P.A. 4 3.08 Acres
Notwithstanding the above, an Assessor’s Parcel within a Planning Area that is transferred to a public agency or property owner’s association prior to the issuance of the first series of CFD No. 113 Bonds that causes the Acreage of Public Property and Property Owner Association Property within such Planning Area to exceed the applicable Acreage limit that can be designated by the CFD Administrator under this Section E.1 shall also be exempted from paying the Special Tax.

F. MANNER OF COLLECTION
The 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. 113 may directly bill the Special Tax, and/or may collect Special Taxes at a different time or in a different manner if necessary to meet financial obligations, and, to the extent of the Facilities Special Tax, may covenant to foreclose and may actually foreclose on delinquent Assessor’s Parcels. 1803
City of Fontana March 20, 2024
Community Facilities District No. 113 (The Gardens Phase Two) Page 15 G. APPEALS AND INTERPRETATIONS
Any landowner or resident who feels that the amount of the Special Tax levied on his/her Assessor’s Parcel is in error may submit a written appeal to the CFD Administrator, provided that the appellant is current in his/her payment of Special Taxes. During the pendency of an appeal, all Special Taxes previously levied must be paid on or before the payment date established when the levy was made. The CFD Administrator shall review the appeal, meet with the appellant if the CFD Administrator deems necessary, and advise the appellant of its determination. If the CFD Administrator agrees with the appellant, a cash refund shall not be made (except for the last year of levy), but the amount of the Special Tax levied shall be appropriately modified through an adjustment to the Special Tax levy in the following Fiscal Year. If the CFD Administrator disagrees with the appellant and the appellant is dissatisfied with the determination, the appellant then has 30 days in which to appeal to the Council by filing a written notice of appeal with the City Clerk, provided that the appellant is current in his/her payment of Special Taxes. This second appeal must specify the reasons for its disagreement with the CFD Administrator's determination.

The following additional definitions apply to this Section H:
"CFD Public Facilities Costs" means either $20,183,675 in 2024 dollars, which shall increase by the Construction Inflation Index on July 1, 2025, and on each July 1 thereafter, or such lower number as (i) shall be determined by the CFD Administrator as sufficient to provide funding for the Authorized Facilities under the authorized bonding program for CFD No. 113, or (ii) shall be determined by the Council concurrently with a covenant that it shall not issue any more CFD No. 113 Bonds (except refunding bonds) to be supported by the Facilities Special Tax levy under this Rate and Method of Apportionment.
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Community Facilities District No. 113 (The Gardens Phase Two) Page 16 "Construction Inflation Index" means the annual percentage change in the Engineering News Record Building Cost Index for the City of Los Angeles, measured as of the month of December in the calendar year which ends in the previous Fiscal Year. In the event this index ceases to be published, the Construction Inflation Index shall be another index as determined by the CFD Administrator that is reasonably comparable to the Engineering News Record Building Cost Index for the City of Los Angeles.
"Future Facilities Costs" means the CFD Public Facilities Costs minus (i) costs of Authorized Facilities previously paid from the Improvement Fund, (ii) moneys currently on deposit in the Improvement Fund available to pay costs of Authorized Facilities, and (iii) the amount the CFD Administrator reasonably expects to derive from the reinvestment of these funds. "Improvement Fund" means a fund or account specifically identified in the Indenture (or prior to the issuance of the first series of CFD No. 113 Bonds a fund or account held by the City) to hold funds which are currently available for expenditure to acquire or construct Authorized Facilities.
"Previously Issued Bonds" means, for any Fiscal Year, all Outstanding Bonds that are outstanding under the Indenture after the first interest and/or principal payment date following the current Fiscal Year.

1. Prepayment in Full
The Facilities Special Tax Prepayment Amount (defined below) shall be calculated as summarized below (capitalized terms as defined below):

1. Confirm that no Special Tax delinquencies apply to such Assessor’s Parcel.

3. (a) Divide the Assigned Facilities Special Tax computed pursuant to paragraph 2 by the total estimated Assigned Facilities Special Tax levy for CFD No. 113 based on the Assigned Facilities Special Taxes for Developed Property which could be levied on all expected development assuming Buildout of CFD No. 113, excluding any Assessor’s Parcels which have been prepaid, and
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Community Facilities District No. 113 (The Gardens Phase Two) Page 17 (b) Divide the Backup Facilities Special Tax computed pursuant to paragraph 2 by the total estimated Backup Facilities Special Taxes at Buildout for the entire CFD No. 113, excluding any Assessor’s Parcels which have been prepaid.

6. Compute the current Future Facilities Costs.

9. Determine the Facilities Special Tax levied on the Assessor’s Parcel in the current Fiscal Year which has not yet been paid.

11. Add the amounts computed pursuant to paragraphs 8 and 9 and subtract the amount computed pursuant to paragraph 10 (the "Defeasance Amount").

13. The reserve fund credit (the "Reserve Fund Credit") shall equal the lesser of: (a) the expected reduction in the reserve requirement (as defined in the Indenture), if any, associated with the redemption of Previously Issued Bonds as a result of the prepayment, or (b) the amount derived by subtracting the new reserve requirement (as defined in the Indenture) in effect after the redemption of Previously Issued Bonds as a result of the prepayment from the balance in the reserve fund on the prepayment date, but in no event shall such amount be less than zero. No Reserve Fund Credit shall be granted if the amount then on deposit in the reserve fund for the Previously Issued Bonds is below 100% of the reserve requirement (as defined in the Indenture). 1806
City of Fontana March 20, 2024
Community Facilities District No. 113 (The Gardens Phase Two) Page 18

2. Prepayment in Part
The amount of the prepayment shall be calculated as in Section H.1; except that a partial prepayment shall be calculated according to the following formula:

PP = [(PE – A) x F] + A
These terms have the following meaning:

PP = the partial prepayment.

PE = the Facilities Special Tax Prepayment Amount calculated according to Section H.1.

F = the percentage, expressed as a decimal, by which the owner of the Assessor’s Parcel is partially prepaying the Facilities Special Tax.

A = the Administrative Fees and Expenses calculated according to Section H.1.

3. General Provisions Applicable to the Prepayment of Facilities Special Tax (a). Use of the Facilities Special Tax Prepayment Amount The Facilities Special Tax Prepayment Amount, less the Administrative Fees and Expenses calculated according to Section H.1 which shall be retained by CFD No. 113, and less the Future Facilities Amount calculated according to Section H.1 which shall be deposited into the Improvement Fund, shall be deposited into specific funds established under the Indenture, to fully or partially redeem as many Outstanding Bonds as possible, and, if amounts are less than $5,000, to make debt service payments on the Outstanding Bonds.
(b). Full Prepayment of Facilities Special Tax
Upon confirmation of the payment of the current Fiscal Year’s entire Facilities Special Tax obligation, the CFD Administrator shall remove the current Fiscal Year’s Facilities Special Tax levy for such Assessor’s Parcel from the County tax rolls. With respect to any Assessor’s Parcel that is prepaid in accordance with Section H.1, the CFD Administrator shall cause a suitable notice to be recorded in compliance with the Act, to indicate the prepayment of the Facilities Special Tax and the release of the Facilities Special Tax lien on such Assessor’s Parcel, and the obligation of such Assessor’s Parcel to pay the Facilities Special Tax shall cease.
(c). Partial Prepayment of Facilities Special Tax
With respect to any Assessor’s Parcel that is partially prepaid, the CFD Administrator shall (i) distribute or cause to be distributed the funds remitted to it according to Section H.3.(a) and (ii) indicate in the records of CFD No. 113 that there has been a partial 1807
City of Fontana March 20, 2024
Community Facilities District No. 113 (The Gardens Phase Two) Page 19 prepayment of the Facilities Special Tax and that a portion of the Facilities Special Tax with respect to such Assessor’s parcel, equal to the outstanding percentage (1.00 – F) of the remaining Maximum Facilities Special Tax, shall continue to be levied on such Assessor’s Parcel pursuant to Section D herein.
(d). Debt Service Coverage
Notwithstanding the foregoing, no prepayment of the Facilities Special Tax shall be allowed unless the amount of Facilities Special Tax that may be levied on Taxable Property (assuming Buildout) within CFD No. 113 in each future Fiscal Year (after excluding Public Property and Property Owner Association Property as set forth in Section E.1 herein), after the proposed prepayment, is at least equal to the sum of (i) 1.10 times the debt service necessary to support the remaining Outstanding Bonds in each corresponding Fiscal Year, and (ii) Administrative Expenses.

T/Clients/FONTANA/MELLO/CFD Nos. 113 (The Gardens Phase Two)/Rate and Method/Fontana CFD No. 113 (The Gardens Phase Two) RMA for ROI.docx 1808
A-1

EXHIBIT A

CERTIFICATE TO AMEND FACILITIES SPECIAL TAX
CFD NO. 113 CERTIFICATE

Planning
Area
Original
Assigned
Facilities
Special Tax
Modified
Assigned
Facilities
Special Tax
P.A. 1 $59,110 per Acre $[____] per Acre
P.A. 2 $59,970 per Acre $[____] per Acre
P.A. 3 $51,370 per Acre $[____] per Acre
P.A. 4 $52,300 per Acre $[____] per Acre
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(c) The Backup Facilities Special Tax for Developed Property within a Planning Area, set forth in Table 3 within Section C.1.a.(4) of the Rate and Method, shall be modified as follows:

2. The Assigned Facilities Special Tax and the Backup Facilities Special Tax for Developed Property may only be reduced prior to the first issuance of CFD No. 113 Bonds.

3. Upon execution of the certificate by CFD No. 113, CFD No. 113 shall cause an amended notice of Special Tax lien for CFD No. 113 to be recorded reflecting the reductions set forth herein.

All capitalized terms used herein shall have the meanings set forth in the Rate and Method.

CITY OF FONTANA COMMUNITY FACILITIES DISTRICT NO. 113
(THE GARDENS PHASE TWO)
By:___________________________ Date:______________________ 1810
B

EXHIBIT B

APPENDIX B
City of Fontana
Community Facilities District No. 113
(The Gardens Phase Two)

BOUNDARY MAP
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18201 VON KARMAN, SUITE 220
IRVINE, CA 92612
PHONE (800) 969-4DTA
Public Finance
Public-Private Partnerships
Development Economics
Clean Energy Bonds
www.FinanceDTA.com
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4125-6365-8317.2

JOINT COMMUNITY FACILITIES AGREEMENT
by and among

CITY OF FONTANA

CITY OF FONTANA
COMMUNITY FACILITIES DISTRICT NO. 113
(THE GARDENS PHASE TWO)
and

WEST VALLEY WATER DISTRICT
Dated as of May 1, 2024
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JOINT COMMUNITY FACILITIES AGREEMENT
THIS JOINT COMMUNITY FACILITIES AGREEMENT (this “Facilities Agreement”), dated as of May 1, 2024, is by and among the CITY OF FONTANA, a general law city organized and existing under the laws of the State of California (the “City”), CITY OF FONTANA COMMUNITY FACILITIES DISTRICT NO. 113 (THE GARDENS PHASE TWO), a community facilities district organized and existing under the laws of the State of California (the “Community Facilities District”), and the WEST VALLEY WATER DISTRICT, a municipal water district organized and existing under the laws of the State of California (the “Water District”).

W I T N E S S E T H:

WHEREAS, the City Council of the City (the “City Council”) has, pursuant to the provisions of the Mello-Roos Community Facilities Act of 1982 (the “Act”), established the Community Facilities District;
WHEREAS, pursuant to the Act, the proceedings of the City Council and an election held within the Community Facilities District, the Community Facilities District is authorized to issue special tax bonds (the “Bonds”) secured by a special tax (the “Special Tax”) levied within the Community Facilities District to finance certain public facilities (the “Facilities”); WHEREAS, the Facilities proposed to be financed by the Community Facilities District include certain Facilities to be owned and operated by the City (the “City Facilities”) and certain Facilities to be owned and operated by the Water District (the “Water District Facilities”); WHEREAS, Section 53316.2 of the Act provides that a community facilities district may finance facilities to be owned or operated by a public agency other than the agency that created the community facilities district only pursuant to a joint community facilities agreement or a joint exercise of powers agreement adopted pursuant to said Section; WHEREAS, Section 53316.2 of the Act further provides that at any time prior to the adoption of the resolution of formation creating a community facilities district or a resolution of change to alter a district, or a resolution or resolutions authorizing issuance of bonds pursuant to Section 53356 of the Act, the legislative bodies of two or more local agencies may enter into a joint community facilities agreement pursuant to said Section and Sections 53316.4 and 53316.6 of the Act to exercise any power authorized by the Act with respect to the community facilities district being created if the legislative body of each entity adopts a resolution declaring that such a joint agreement would be beneficial to the residents of that entity; WHEREAS, no resolution authorizing the issuance of any Bonds has been adopted; WHEREAS, the City Council and the Board of Directors of the Water District have each adopted a resolution declaring that such a joint agreement would be beneficial to the residents of that entity;
WHEREAS, North Fontana Investment Company, LLC (the “Developer”) is the master developer of the property within the boundaries of the Community Facilities District; 1840
2 4125-6365-8317.2
WHEREAS, development of such property will require the acquisition, construction and installation of certain Water District Facilities;
WHEREAS, in order to provide for the acquisition, construction and installation of such Water District Facilities, the Water District and the Developer are entering into an Acquisition and Funding Agreement (the “Acquisition Agreement”), pursuant to which the Developer will acquire, construct and install, or cause to be acquired, constructed and installed, certain of the Water District Facilities and, upon satisfaction of the conditions specified therein, the Water District will acquire and take title to such Water District Facilities and that the Developer will be paid the purchase price thereof from proceeds of the Special Tax or Bonds (collectively, “District Proceeds”) made available for such purpose by the Community Facilities District; and WHEREAS, the City, the Community Facilities District and the Water District desire to enter into this Facilities Agreement in accordance with Sections 53316.2, 53316.4 and 53316.6 of the Act in order to provide for the financing of the Water District Facilities with District Proceeds; NOW, THEREFORE, for and in consideration of the mutual promises and covenants herein contained, the parties hereto agree as follows:

Section 1. Issuance of Bonds. (a) It is anticipated that the Community Facilities District will issue Bonds to finance the acquisition, construction and installation of the City Facilities and the Water District Facilities. The City Council, acting as the legislative body of the Community Facilities District, shall, in its sole discretion, determine whether, when, under what conditions and to what extent Bonds shall be issued to finance the acquisition, construction and installation of the City Facilities or the Water District Facilities, or any combination thereof. In no event shall the Water District have any right to compel the Community Facilities District to issue Bonds to finance the acquisition, construction and installation of Water District Facilities or to disburse Bond proceeds to pay the costs of the acquisition, construction and installation of Water District Facilities.
(b) It is anticipated that the Community Facilities District may make proceeds of the Special Tax available to finance the acquisition, construction and installation of the City Facilities and the Water District Facilities. The City Council, acting as the legislative body of the Community Facilities District, shall, in its sole discretion, determine whether, when, under what conditions and to what extent any such Special Tax proceeds shall be made available to finance the acquisition, construction and installation of the City Facilities or the Water District Facilities, or any combination thereof. In no event shall the Water District have any right to compel the Community Facilities District to make proceeds of the Special Tax available to finance the acquisition, construction and installation of Water District Facilities or to disburse such Special Tax proceeds to pay the costs of the acquisition, construction and installation of Water District Facilities.

Section 2. Water District Facilities. (a) The Water District Facilities, including any real or tangible property that is to be purchased, constructed, expanded or rehabilitated, are described in Exhibit A attached hereto.
(b) It is anticipated that the Community Facilities District will make District Proceeds available to finance the acquisition, construction and installation of the Water District Facilities. 1841
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If the Community Facilities District makes District Proceeds available for such purpose, the Community Facilities District shall notify the Water District of the amount of such District Proceeds available for such purpose within 15 days of such District Proceeds becoming so available. The Community Facilities District makes no representation that, if District Proceeds are made available to finance the acquisition, construction and installation of the Water District Facilities, such District Proceeds will be sufficient to finance the acquisition, construction and installation of all of the Water District Facilities, and neither the City nor the Community Facilities District shall have any liability to the Water District if such District Proceeds are insufficient for such purpose. If the Community Facilities District determines not to make District Proceeds available to finance the acquisition, construction and installation of the Water District Facilities, neither the City nor the Community Facilities District shall have any obligation to provide any amounts to finance or pay the costs of the acquisition, construction and installation of the Water District Facilities.

Section 3. Disbursements. (a) District Proceeds available for the acquisition, construction and installation of the Water District Facilities shall be deposited in a special account (howsoever denominated, the “Water District Facilities Account”), which (i) prior to the issuance of Bonds, is to be established and held by or on behalf of the Community Facilities District, and (ii) upon the issuance of Bonds is to be established and held under the Indenture pursuant to which the Bonds are issued. Moneys on deposit in the Water District Facilities Account shall be invested and disbursed at the direction of the Community Facilities District. (b) To the extent that moneys are available therein, the Community Facilities District shall cause disbursements to be made from the Water District Facilities Account from time to time to pay the costs of the acquisition, construction and installation of the Water District Facilities upon submission of a written request of the Water District stating (i) the name and address of the person to whom payment is to be made, (ii) the amount to be paid, (iii) that an obligation in such amount has been incurred by the Water District, (iv) the purpose for which the obligation to be paid was incurred, (v) that each item of the obligation to be paid constitutes a cost of the Water District Facilities, (vi) that the obligation to be paid has not been the subject of a prior Water District request for disbursement from the Water District Facilities Account, (vii) that each portion of the Water District Facilities for which payment is requested was constructed under the direction and supervision, or under the authority of, the Water District or was constructed as if it had been constructed under the direction and supervision, or under the authority of, the Water District, and (viii) that each portion of the Water District Facilities being purchased pursuant to the Acquisition Agreement for which payment is requested is being acquired and purchased in accordance with the provisions of the Act and the Acquisition Agreement.

The Community Facilities District shall process in a timely manner written requests for disbursements received from the Water District that conform to the requirements hereof.

Section 4. Construction, Ownership and Maintenance of City Facilities and Water District Facilities. (a) The Water District shall have no responsibility for the acquisition, construction and installation of the City Facilities. The City Facilities shall be and remain the sole and separate property of the City and shall be operated, maintained and utilized by the City. The Water District shall not have any ownership interest in the City Facilities, and the Water District shall have no responsibility for the operation, maintenance or utilization of the City Facilities. 1842
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(b) Neither the City nor the Community Facilities District shall have any responsibility for the acquisition, construction and installation of the Water District Facilities. The Water District Facilities shall be and remain the sole and separate property of the Water District and shall be operated, maintained and utilized by the Water District. Neither the City nor the Community Facilities District shall have any ownership interest in the Water District Facilities, and neither the City nor the Community Facilities District shall have any responsibility for the operation, maintenance or utilization of the Water District Facilities.

Section 5. Tax Matters. In connection with the issuance of any Bonds, a portion of the proceeds of which are to be made available to finance the acquisition, construction and installation of the Water District Facilities, the Water District shall execute and deliver such certifications and agreements as may be reasonably required in order for bond counsel to conclude that interest on such Bonds will be excluded from gross income under Section 103 of the Internal Revenue Code of 1986.

Section 6. Indemnification. (a) The City agrees to protect, indemnify, defend and hold the Water District, and its officers, employees and agents, and each of them, harmless from and against any and all claims, losses, expenses, suits actions, decrees, judgments, awards, attorneys’ fees and court costs which the Water District, or its officers, employees and agents, or any combination thereof, may suffer or which may be sought against or recovered or obtained from the Water District, or its officers, employees or agents, or any combination thereof, as a result of or by reason of or arising out of or in consequence of the acquisition, construction, installation, operation, maintenance or utilization of the City Facilities. If the City fails to do so, the Water District shall have the right, but not the obligation, to defend the same and charge all of the direct and incidental costs of such defense, including any attorneys’ fees or court costs, to and recover the same from the City.

No indemnification is required to be paid by the City for any claim, loss or expense arising from the willful misconduct or negligence of the Water District, or its officers, employees or agents.
(b) The Water District agrees to protect, indemnify, defend and hold the City and the Community Facilities District, and their respective officers, employees and agents, and each of them, harmless from and against any and all claims, losses, expenses, suits actions, decrees, judgments, awards, attorneys’ fees and court costs which the City or the Community Facilities District, or their respective officers, employees and agents, or any combination thereof, may suffer or which may be sought against or recovered or obtained from the City or the Community Facilities District, or their respective officers, employees or agents, or any combination thereof, as a result of or by reason of or arising out of or in consequence of the acquisition, construction, installation, operation, maintenance or utilization of the Water District Facilities. If the Water District fails to do so, the City and the Community Facilities District shall have the right, but not the obligation, to defend the same and charge all of the direct and incidental costs of such defense, including any attorneys’ fees or court costs, to and recover the same from the Water District.

No indemnification is required to be paid by the Water District for any claim, loss or expense arising from the willful misconduct or negligence of the City or the Community Facilities District, or their respective officers, employees or agents. 1843
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Section 7. Nature of Agreement; Allocation of Special Tax. This Facilities Agreement shall constitute a joint community facilities agreement entered into pursuant to Sections 53316.2, 53316.4 and 53316.6 of the Act. The entire amount of the proceeds of the Special Tax shall be allocated and distributed to the City.

Section 8. Limitation of Rights to Parties. Nothing in this Facilities Agreement expressed or implied is intended or shall be construed to give to any person other than the City, the Community Facilities District and the Water District any legal or equitable right, remedy or claim under or in respect of this Facilities Agreement or any covenant, condition or provision herein contained; and all such covenants, conditions and provisions are and shall be held to be for the sole and exclusive benefit of the City, the Community Facilities District and the Water District.

Section 9. Notices. All written notices to be given hereunder shall be given to the party entitled thereto at its address set forth below, or at such other address as such party may provide to the other parties in writing from time to time, namely:

If to the City:

City of Fontana
8353 Sierra Avenue
Fontana, CA 92335
Attention: Chief Financial Officer, Finance Department
If to the Community Facilities District:

City of Fontana Community Facilities
District No. 113 (The Gardens Phase Two)
c/o City of Fontana
8353 Sierra Avenue
Fontana, CA 92335
Attention: Chief Financial Officer, Finance Department
If to the Water District:

West Valley Water District
Post Office Box 920
Rialto, CA 92377-0920
Attention: General Manager
Each such notice, statement, demand, consent, approval, authorization, offer, designation, request or other communication hereunder shall be deemed delivered to the party to whom it is addressed (a) if given by courier or delivery service or if personally served or delivered, upon delivery, (b) if given by telecopier, upon the sender’s receipt of an appropriate answerback or other written acknowledgment, (c) if given by electronic mail, on the date sent, but only if confirmation of the receipt of such electronic mail is received or if notice is concurrently sent by another means specified herein, (d) if given by registered or certified mail, return receipt requested, deposited with the United States mail postage prepaid, 72 hours after such notice is deposited with the United 1844
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States mail, or (e) if given by any other means, upon delivery at the address specified in this Section.

Section 10. Severability. If any part of this Facilities Agreement is held to be illegal or unenforceable by a court of competent jurisdiction, the remainder of this Facilities Agreement shall be given effect to the fullest extent reasonably possible.

Section 11. Successors. This Facilities Agreement shall be binding upon and inure to the benefit of the successors of the parties hereto.

Section 12. Amendments. This Facilities Agreement may be amended, supplemented or otherwise modified only by an instrument in writing executed and delivered by each of the parties hereto.

Section 13. Governing Laws. This Facilities Agreement shall be governed and construed in accordance with the laws of the State of California.

Section 14. Counterparts. This Facilities Agreement may be executed in counterparts, each of which shall be deemed an original and all of which shall constitute but one and the same instrument.
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4125-6365-8317.2

EXHIBIT A

DESCRIPTION OF WATER DISTRICT FACILITIES
The types of facilities to be owned and operated by the Water District and financed by the District Proceeds are water distribution, treatment and storage facilities, together with appurtenances and appurtenant work.
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4165-9371-5022.3

ACQUISITION AND FUNDING AGREEMENT
by and among

CITY OF FONTANA
COMMUNITY FACILITIES DISTRICT NO. 113
(THE GARDENS PHASE TWO)
and

CITY OF FONTANA
and

NORTH FONTANA INVESTMENT COMPANY, LLC
Dated as of May 1, 2024
City of Fontana
Community Facilities District No. 113
(The Gardens Phase Two)
Special Tax Bonds
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TABLE OF CONTENTS
Page
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4165-9371-5022.3
ARTICLE I DEFINITIONS .................................................................................................... 3 Section 1.01. Definitions.................................................................................................... 3 ARTICLE II FUNDING PRIORITIES; CREDITS .................................................................. 9 Section 2.01. Funding Priorities......................................................................................... 9 Section 2.02. Payment of Permit Fees as Deposit ........................................................... 10 Section 2.03. Credits ........................................................................................................ 10 ARTICLE III ACQUISITION OF ACQUISITION FACILITIES .......................................... 12 Section 3.01. Acquisition of Acquisition Facilities ......................................................... 12 Section 3.02. Payment of Purchase Price......................................................................... 12 Section 3.03. Payments of Credit Amount....................................................................... 13 Section 3.04. Dedication of Property and Easements to City .......................................... 14 Section 3.05. Modifications to Segments and Acquisition Costs .................................... 14 ARTICLE IV CONSTRUCTION OF ACQUISITION FACILITIES ..................................... 15 Section 4.01. Preparation and Approval of Plans and Specifications .............................. 15 Section 4.02. Duty of Developer to Construct ................................................................. 15 Section 4.03. Public Works Requirements ...................................................................... 15 Section 4.04. Bonding Requirements............................................................................... 16 Section 4.05. Inspection; Completion of Construction .................................................... 17 Section 4.06. Maintenance of Acquisition Facilities; Warranties .................................... 17 Section 4.07. Insurance Requirements ............................................................................. 17 Section 4.08. Ownership of Acquisition Facilities .......................................................... 19 ARTICLE V REPRESENTATIONS, WARRANTIES AND COVENANTS;
INDEMNIFICATION ....................................................................................... 20 Section 5.01. Representations and Warranties of the Developer ..................................... 20 Section 5.02. Covenants of the Developer ....................................................................... 21 Section 5.03. Representations and Warranties of the Community Facilities District and the City .............................................................................................. 22 Section 5.04. Covenants of the Community Facilities District and the City ................... 23 Section 5.05. Indemnification .......................................................................................... 23 1849

TABLE OF CONTENTS
(continued)
Page
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ARTICLE VI TERMINATION; DAMAGES ......................................................................... 25 Section 6.01. Termination by Agreement ........................................................................ 25 Section 6.02. Termination by City ................................................................................... 25 Section 6.03. Termination by Developer ......................................................................... 27 Section 6.04. Remedies in General; Damages Limited ................................................... 27 Section 6.05. Force Majeure ............................................................................................ 28 ARTICLE VII MISCELLANEOUS .......................................................................................... 30 Section 7.01. Developer as Independent Contractor ........................................................ 30 Section 7.02. Other Agreements ...................................................................................... 30 Section 7.03. Binding on Successors and Assigns ........................................................... 30 Section 7.04. Amendments .............................................................................................. 30 Section 7.05. Waivers ...................................................................................................... 30 Section 7.06. No Third-Party Beneficiaries ..................................................................... 30 Section 7.07. Notices ....................................................................................................... 30 Section 7.08. Attorneys’ Fees .......................................................................................... 31 Section 7.09. Jurisdiction and Venue ............................................................................... 31 Section 7.10. Governing Law .......................................................................................... 32 Section 7.11. Electronic Signature ................................................................................... 32 Section 7.12. Usage of Words.......................................................................................... 32 Section 7.13. Counterparts ............................................................................................... 32 Section 7.14. Effective Date ............................................................................................ 32 EXHIBIT A ACQUISITION FACILITIES ......................................................................... A-1 EXHIBIT B FORM OF PAYMENT REQUEST ................................................................ B-1 1850
4165-9371-5022.3

ACQUISITION AND FUNDING AGREEMENT
THIS ACQUISITION AND FUNDING AGREEMENT (this “Acquisition Agreement”), dated as of May 1, 2024, is by and among CITY OF FONTANA COMMUNITY FACILITIES DISTRICT NO. 113 (The Gardens Phase Two), a community facilities district organized and existing under the laws of the State of California (the “Community Facilities District”), the CITY OF FONTANA, a general law city organized and existing under the laws of the State of California (the “City”), and NORTH FONTANA INVESTMENT COMPANY, LLC, a limited liability company organized and existing under the laws of the State of Delaware (the “Developer”).

W I T N E S S E T H:

WHEREAS, the Developer is developing certain property within the City as a masterplanned community known as The Arboretum (the “Project Property”); WHEREAS, the City Council of the City (the “City Council”) has, pursuant to the provisions of the Mello-Roos Community Facilities Act of 1982 (the “Act”), established the Community Facilities District;
WHEREAS, the property within the Community Facilities District consists of a portion of the Project Property;
WHEREAS, pursuant to the Act, the proceedings of the City Council and an election held within the Community Facilities District, the Community Facilities District is authorized to issue bonds (the “Bonds”) secured by a special tax (the “Special Tax”) levied within the Community Facilities District to finance certain public facilities; WHEREAS, the Community Facilities District will, upon satisfaction of the conditions and in accordance with the terms set forth in this Acquisition Agreement, purchase certain of such public facilities, described herein (the “Acquisition Facilities”), the City will take title thereto and the Developer will be paid from the proceeds of the Bonds for the costs of acquisition, construction and improvement of the Acquisition Facilities at the prices as determined as set forth herein; WHEREAS, the Bonds are to be issued pursuant to an indenture (the “Indenture”) to be entered into by the Community Facilities District and a commercial bank or trust company (the “Trustee”);
WHEREAS, pursuant to the Indenture, the Community Facilities District will establish or cause the Trustee to establish an acquisition account into which a portion of the proceeds of the Bonds will be deposited, which amounts will be used to finance the acquisition of the Acquisition Facilities;
WHEREAS, Section 53313.5 of the Act provides that a community facilities district may only finance the purchase of facilities whose construction has been completed, as determined by the legislative body, before the resolution of formation to establish the community facilities district is adopted pursuant to Section 53325.1 of the Act, except that a community facilities district may finance the purchase of facilities completed after the adoption of the resolution of formation if the 1851
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facility was constructed as if it had been constructed under the direction and supervision, or under the authority of, the local agency that will own or operate the facility; WHEREAS, the Acquisition Facilities are to be acquired by the City under this Acquisition Agreement pursuant to the Act and, specifically, pursuant to the provisions of Section 53313.5 thereof; and
WHEREAS, the Community Facilities District, the City and the Developer desire to provide for the priority in which proceeds of the Special Tax and proceeds of the Bonds are to be applied and certain other matters regarding the Community Facilities District, the Special Tax and the Bonds;
NOW, THEREFORE, for and in consideration of the mutual promises and covenants contained herein, the parties hereto agree as follows:
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ARTICLE I

DEFINITIONS
Section 1.01. Definitions. All terms defined in the Indenture shall have the same meaning in this Acquisition Agreement, except as indicated. Unless the context otherwise requires, the terms defined in this Article I shall have the meanings herein specified:
“Acceptable Title” means title to land, or an easement therein, delivered free and clear of all liens, taxes, assessments, leases, easements and encumbrances, whether any such item is recorded or unrecorded, except those non-monetary items that are reasonably determined by the City not to interfere with the intended use of such land or easement and therefore are not required to be cleared from title.
“Acceptance Date” means (a) with respect to a Segment, either (i) the date that the full amount of the Purchase Price thereof is payable to the Developer pursuant to the terms hereof and of the Indenture, or (ii) if 90% of the Purchase Price of such Segment was paid to the Developer pursuant to Section 3.02(c) hereof, the date that the remaining 10% of the Purchase Price of such Segment is payable to the Developer pursuant to the terms hereof and of the Indenture, and (b) with respect to a Component, either (i) the date that the full Purchase Price of the last of the Segments included in such Component is payable to the Developer pursuant to the terms hereof and of the Indenture, or (ii) if 90% of the Purchase Price of such Segment was paid to the Developer pursuant to Section 3.02(c) hereof, the date that the remaining 10% of the Purchase Price of such Segment is payable to the Developer pursuant to the terms hereof and of the Indenture. “Acquisition Account” means the account by that name established under the Indenture, the amounts in which are to be applied to the payment of the Purchase Price of the Segments. “Acquisition Agreement” means this Acquisition and Funding Agreement, dated as of May 1, 2024, by and among the Community Facilities District, the City and the Developer, as originally executed or as the same may from time to time be amended, supplemented or otherwise modified pursuant to the provisions hereof.
“Acquisition Cost” means, with respect to a Segment, the amount specified as the Acquisition Cost for such Segment in Exhibit A attached hereto, as the same may be modified by one or more supplements thereto entered into in accordance with Section 3.05 hereof. “Acquisition Facilities” means the public facilities described in Exhibit A attached hereto. “Act” means the Mello-Roos Community Facilities Act of 1982, constituting Sections 53311 et seq. of the California Government Code.
“Actual Cost” means, with respect to a Segment, an amount equal to the sum of (a) the actual, reasonable cost of constructing such Segment, including labor, material and equipment costs, (b) the actual, reasonable cost of designing and preparing the Plans for such Segment, including engineering services provided in connection with designing and preparing such Plans, (c) the actual, reasonable cost of environmental evaluations required in the City’s reasonable determination specifically for such Segment, (d) the amount of any fees actually paid to 1853
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governmental agencies in order to obtain permits, licenses or other necessary governmental approvals and reviews for such Segment, (e) the actual, reasonable cost for construction management services for such Segment, which cost shall not exceed 5% of the cost of constructing such Segment, as determined pursuant to clause (a) of this definition, (f) the actual, reasonable cost for professional services directly related to the construction of such Segment, including engineering, inspection, construction staking, materials testing and similar professional services, which costs shall not exceed 18% of the costs of constructing such Segment, as determined pursuant to clause (a) of this definition, (g) the actual, reasonable cost of any performance and maintenance bonds and insurance, including title insurance, required hereby for such Segment, and (h) the actual, reasonable cost of any real property or interest therein acquired from a party other than the Developer or an Affiliate thereof (including amounts advanced by the Developer to the City for such purpose), which real property or interest therein is either necessary for the construction of such Segment (e.g., temporary construction easements, haul roads, etc.) or is required to be conveyed with such Segment in order to convey Acceptable Title thereto to the City or its designee, all as specified in a Payment Request that has been reviewed and approved by the City Engineer; provided, however, that (x) no item of cost relating to a Segment shall be included in more than one category of cost specified in clauses (a) through (h) of this definition, and (y) each item of cost shall include only amounts actually paid by the Developer to third parties, other than Affiliates of the Developer, and shall not include overhead or other internal expenses of the Developer.
“Administrative Expenses” has the meaning ascribed to that term in the Rate and Method. “Affiliate” of another Person means (a) each Person that, directly or indirectly, owns or controls, whether beneficially or as trustee, guardian, or other fiduciary, 50% or more of any class of equity securities of such other Person, and (b) each Person that controls, is controlled by or is under common control with or by such Person or any Affiliate of such Person. For the purpose of this definition, “control” of a Person shall mean the possession, directly or indirectly, of the power to direct or cause the direction of its management or policies, whether through the ownership of voting securities, by contract or otherwise.
“Aggregate Overage Amount” means, as of any date, the sum of the Overage Amounts for all Segments for which the Acceptance Date occurred on or before such date. “Aggregate Savings Amount” means, as of any date, the sum of the Savings Amounts for all Segments for which the Acceptance Date occurred on or before such date. “Authorized Representative” means, with respect to the Community Facilities District, the City Manager of the City and the Chief Financial Officer, Finance Department, of the City, and any other Person designated as an Authorized Representative of the Community Facilities District in a Written Certificate of the Community Facilities District filed with the Trustee. “Bonds” means the City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) Special Tax Bonds issued under the Indenture. “City” means the City of Fontana, a general law city organized and existing under the laws of the State, and its successors.
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“City Engineer” means the City Engineer of the City.
“Closing Date” means the date on which the Bonds are issued and delivered to the initial purchaser thereof.
“Community Facilities District” means City of Fontana Community Facilities District No. 113 (The Gardens Phase Two), a community facilities district organized and existing under the laws of the State, and its successors.
“Community Benefit Facilities Account” means the account by that name established under the Indenture, the amounts in which are to be applied to the payment of the costs of the acquisition, construction and installation of the Construction Facilities. “Complete” means, with respect to a Segment, that the construction of such Segment (including all ancillary, non-essential items included in such Segment) by or on behalf of the Developer is, in the reasonable judgment of the City Engineer, in all respects complete. “Components” means the related groups of Segments identified as such and described in Exhibit A attached hereto; each Component is comprised of the Segments listed thereunder in Exhibit A.
“Conditions of Approval” means the conditions of approval of all land use entitlements approved by the City for the Property and the conditions of the subdivision improvement agreement or other agreement between the Developer and the City relating to the Property, which conditions the Developer must satisfy or cause to be satisfied in order to develop the Property. “Construction Account” means the account by that name established under the Indenture, the amounts in which are to be applied to the payment of the costs of the acquisition, construction and installation of the Construction Facilities.
“Construction Facilities” means the facilities authorized to be financed by the Community Facilities District, other than the Acquisition Facilities and the Water District Facilities.
“Credit Amount” means, as of any date, the remainder of (a) the Aggregate Savings Amount as of such date, minus (b) the aggregate amount paid to the Developer prior to such date pursuant to Section 3.03 hereof; provided, however, that in no event shall such Credit Amount exceed the remainder of (i) the Aggregate Overage Amount as of such date, minus (ii) the aggregate amount paid to the Developer prior to such date pursuant to Section 3.03 hereof. “Deposit Account” means a separate account established by the City to be used exclusively for the deposit, holding and application of a category of Permit Fees and any amounts paid as a security deposit therefor, as contemplated by Section 2.02 hereof. “Developer” means North Fontana Investment Company, LLC, a limited liability company organized and existing under the laws of the State of Delaware, and its successors and assigns.
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“Developer Advance” has the meaning ascribed to such term in the Advance and Reimbursement Agreement, dated as of June 10, 2008, by and between the City and the Developer, as amended by the First Amendment to Advance and Reimbursement Agreement, dated as of November 8, 2016, by and between the City and the Developer, or as the same may from time to time be further amended, supplemented or otherwise modified pursuant to the provisions thereof. “Developer Representative” means the person or persons designated as such in a certificate signed by the Developer and delivered to the Community Facilities District and the Trustee, which certificate shall contain an original or specimen signature of each person so designated.
“Development Agreement” means the Development Agreement, effective November 14, 2009, by and between the City and the Developer, as amended by the First Amendment to Arboretum Development Agreement, by and between the City and the Developer, recorded on April 5, 2017 as Document No. 2017-0142267 in the Official Records of San Bernardino County and by the Second Amendment to Arboretum Development Agreement, by and between the City and the Developer, recorded on September 15, 2021 as Document No. 2021-0420491 in the Official Records of San Bernardino County, or as the same may from time to time be further amended, supplemented or otherwise modified pursuant to the provisions thereof. “Effective Date” means May 14, 2024.
“General Prevailing Wage Rates” means those rates as determined by the Director of the Department of Industrial Relations of the State of California. “Hazardous Material” means any hazardous or toxic substance, material or waste that is regulated by any local governmental authority, the State or the United States Government, including, without limitation, any material or substance that is (a) designated as a “hazardous substance” pursuant to Section 311 of the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq. (33 U.S.C. § 1321), (b) defined as a “hazardous waste” pursuant to Section 1004 of the Federal Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq. (42 U.S.C. § 6903), (c) defined as a “hazardous substance” pursuant to Section 101 of the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. § 9601 et seq., (d) petroleum, or (e) asbestos.
“Indenture” means the indenture, by and between the Community Facilities District and the Trustee, pursuant to which the Bonds are issued, as originally executed or as the same may from time to time be supplemented, amended or otherwise modified by any supplemental indenture entered into pursuant to the provisions thereof or, if such Indenture has been discharged in accordance with its terms, the indenture, trust agreement, fiscal agent agreement or similar instrument, regardless of title, pursuant to which bonds, notes or other evidences of indebtedness of the Community Facilities District have been issued and are outstanding, as originally executed or as the same may from time to time be supplemented, amended or otherwise modified pursuant to the provisions thereof.
“Joint Community Facilities Agreement” means the Joint Community Facilities Agreement, dated as of May 1, 2024, by and among the City, the Community Facilities District 1856
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and the Water District, as originally executed or as the same may from time to time be supplemented, amended or otherwise modified pursuant to the provisions thereof. “Payment Request” means the document to be provided by the Developer to substantiate the Purchase Price of one or more Segments, which shall be substantially in the form of Exhibit B attached hereto.
“Permit Fees” means, with respect to a Subject Unit, the Circulation Fee, the Fire Facilities Impact Fee, the Flood Control Fee, the Library Facilities Impact Fee, the Local Arterials Fee, the Median Landscape Fee, the Municipal Services Impact Fee, the Park Development Fee, the Police Facilities Impact Fee, the Public Facilities Impact Fee, the Sewer Connection Impact Fee and the Storm Drainage Facilities Fee, all as described in the Development Agreement, payable to the City as a condition precedent to the City’s issuing a building permit for such Subject Unit.
“Person” means an individual, a corporation, a partnership, an association, a limited liability company, a joint stock company, a trust, any unincorporated organization or a government or political subdivision thereof.
“Plans” means the plans and specifications for the Acquisition Facilities prepared or to be prepared at the direction of the Developer pursuant to Section 4.01 hereof. “Project Property” has the meaning ascribed thereto in the recitals of this Acquisition Agreement.
“Property” means the real property located within the Community Facilities District. “Public Improvement Policies” means the City’s operational and implementation policies and procedures for public improvement construction using public funds, as set forth in the City of Fontana Public Improvement Policy and Procedure Manual, dated July 30, 1990, as originally adopted by the City Council of the City or as the same may be amended or supplemented from time to time.
“Purchase Price” means, with respect to a Segment, subject to the provisions of Section

3.02 hereof, the lesser of the Actual Cost or the Acquisition Cost of such Segment. “Rate and Method” means the Rate and Method of Apportionment for City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) approved by the qualified electors of the Community Facilities District.
“Related Property” means, with respect to a Segment, the property on, in or over which such Segment is located, which property, or an easement thereon or other interest therein, is dedicated or otherwise conveyed to the City as provided in Section 3.04 hereof. “Savings Amount” means, with respect to a Segment, the amount, if any, by which the Acquisition Cost of such Segment exceeds the Actual Cost of such Segment. 1857
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“Segments” means the discrete portions of the Components identified as such and described in Exhibit A attached hereto, as the same may be modified by one or more supplements thereto entered into in accordance with Section 3.05 hereof. “Special Tax” means the special tax described and defined in the Rate and Method as “Facilities Special Tax” approved by the qualified electors of the Community Facilities District. “State” means the State of California.
“Subject Unit Fee Amount” means, as of any date, the amount of Permit Fees applicable to a Subject Unit as of such date.
“Subject Units” means the 388 residential housing units to be constructed on the Property, for which entitlements have been granted by the City.
“Substantially Complete” means, with respect to a Segment, that the construction of such Segment by or on behalf of the Developer has, in the reasonable judgment of the City Engineer, reached a stage of completion sufficient to allow such Segment to be utilized for the purpose for which it is intended and that only the construction of ancillary, non-essential items remains incomplete; provided, however, that a Segment shall not be deemed to be Substantially Complete if, in the reasonable judgment of the City Engineer, the cost to complete the construction of such ancillary, non-essential items would exceed 10% of the Purchase Price of such Segment. “Trustee” means the commercial bank or trust company initially designated as trustee under the Indenture, and any successor thereto permitted under the Indenture. “Water District” means the West Valley Water District, a municipal water district organized and existing under the laws of the State of California, and its successors. “Water District Account” means the account by that name established under the Indenture, the amounts in which are to be applied to the payment of the costs of the acquisition, construction and installation of the Water District Facilities. “Water District Facilities” means the Water District facilities described in Exhibit A to the Joint Community Facilities Agreement.
“Written Certificate” and “Written Request” of the Community Facilities District mean, respectively, a written certificate or written request signed in the name of the Community Facilities District by an Authorized Representative. Any such certificate or request may, but need not, be combined in a single instrument with any other instrument, opinion or representation, and the two or more so combined shall be read and construed as a single instrument. 1858
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ARTICLE II
FUNDING PRIORITIES; CREDITS
Section 2.01. Funding Priorities. (a) Prior to the issuance of the Bonds, the proceeds of the Special Tax collected in each fiscal year shall, as soon as reasonably practicable, be applied in the following order of priority:

First Priority. To pay, or to provide for the payment of, Administrative Expenses.

Second Priority. To provide for the payment of the costs of the acquisition, construction and installation of the Construction Facilities. (b) Upon the issuance of the Bonds, the proceeds thereof received by or on behalf of the Community Facilities District shall be applied in the following order of priority:

First Priority. To pay, or to provide for the payment of, the costs of issuing the Bonds.

Second Priority. To provide for the payment of Administrative Expenses until Special Tax receipts are anticipated to be sufficient therefor.

Third Priority. To fund a reserve fund for the Bonds in an amount equal to the reserve requirement therefor, as provided in the Indenture.

Fourth Priority. To fund capitalized interest in an amount to pay up to 12 months of interest on the Bonds, as determined by the City.

Fifth Priority. If the Developer Advance has not been repaid in full, to repay the Developer for the remaining unpaid amount of the Developer Advance.

Sixth Priority. For deposit in the Community Benefit Facilities Account an amount equal to the payment, if any, that the City is to receive pursuant to Section 4.1.2 of the Development Agreement.

Seventh Priority. For deposit in the Acquisition Account until the amount deposited in the Acquisition Account pursuant to this Seventh Priority, is equal to the total Purchase Prices of all Acquisition Facilities expected to be acquired.

Eighth Priority. For deposit in the Water District Account until the amount deposited in the Water District Account pursuant to this Eighth Priority, is equal to the total amount of Water District Facilities expected to be financed with proceeds of the Bonds.

Ninth Priority. For deposit in the Construction Account an amount equal to the lesser of (i) the amount of all Permit Fees paid by or on behalf of the Developer deposited in the Deposit Accounts pursuant to subsection (a) of Section 2.02 hereof, and (ii) the remaining amount of such proceeds.
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Tenth Priority. For deposit in the Construction Account, the remainder of such proceeds, if any; provided, however, that the sum of (i) the amount deposited in the Construction Account pursuant to the Ninth Priority in this subsection, plus (ii) the amount deposited in the Construction Account pursuant to this Tenth Priority shall not exceed the product of (A) 388, times (B) the Subject Unit Fee Amount as of the date such proceeds are so deposited.
(c) If, after the payment of the Purchase Prices of all of the Segments, as provided herein, amounts remain on deposit in the Acquisition Account, such remaining amounts shall be transferred to and deposited in the Community Benefit Facilities Account. If, after the completion of all of the Water District Facilities to be financed from the amount deposited in the Water District Account pursuant to the Eighth Priority of subsection (b) of this Subsection, amounts remain on deposit in the Water District Account, such remaining amounts shall be transferred to and deposited in the Community Benefit Facilities Account.

Section 2.02. Payment of Permit Fees as Deposit. (a) The Developer shall timely pay, or cause to be paid, an amount equal to all Permit Fees that are chargeable upon issuance of a building permit for a Subject Unit. Any amounts so paid prior to the issuance of the Bonds shall constitute a security deposit for the payment of such Permit Fees and, upon receipt thereof, the City shall deposit such amounts in one or more Deposit Accounts. Except as otherwise provided in subsection (b) of this Section, amounts on deposit in such Deposit Accounts shall not be expended by the City; provided, however, that earnings on the investment of amounts on deposit in a Deposit Account shall be withdrawn by the City and applied by the City to any legally permitted purpose.
(b) If, upon the issuance of the Bonds, proceeds thereof are deposited in the Construction Account, as provided in the Ninth Priority in subsection (b) of Section 2.01 hereof, the City shall withdraw from the Deposit Accounts and, as soon as practicable, return to the Developer, or the Developer’s designee, an amount equal to the amount of such proceeds so deposited. Any amounts remaining in the Deposit Accounts after such withdrawal shall constitute Permit Fees paid by or on behalf of the Developer in satisfaction of the obligation to pay such Permit Fees. Any such amounts remaining in the Deposit Accounts shall be withdrawn by the City and applied thereby to any purposes to which such Permit Fees may legally be applied.

Section 2.03. Credits. (a) If, upon the issuance of the Bonds, proceeds thereof are deposited in the Construction Account as provided in the Ninth Priority in subsection (b) of Section

2.01 hereof, the Developer shall, upon such deposit, be deemed to have paid Permit Fees for the number of Subject Units equal to the largest whole number that is not greater than the quotient of (i) the amount of such proceeds so deposited in the Construction Account in accordance with the Ninth Priority in subsection (b) of Section 2.01 hereof, divided by (ii) the Subject Unit Fee Amount as of the date such proceeds are so deposited.
(b) If (i) upon the issuance of the Bonds, proceeds thereof are deposited in the Construction Account as provided in the Tenth Priority in subsection (b) of Section 2.01 hereof, and (ii) the Developer has not, pursuant to subsection (a) of this Section, been deemed to have paid Permit Fees for all of the Subject Units, the Developer shall be deemed to have paid Permit Fees that would otherwise subsequently become payable for the number of Subject Units equal to the 1860
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lesser of (A) the number of Subject Units for which the Developer has not, pursuant to subsection (a) of this Section, been deemed to have paid Permit Fees, and (B) the largest whole number that is not greater than the quotient of (I) the amount of such proceeds so deposited in the Construction Account in accordance with the Tenth Priority in subsection (b) of Section 2.01 hereof, divided by (II) the Subject Unit Fee Amount as of the date such proceeds are so deposited. (c) If (i) remaining amounts in the Acquisition Account are transferred to and deposited in the Construction Account pursuant to subsection (c) of Section 2.01 hereof, and (ii) the Developer has not, pursuant to subsections (a) and (b) of this Section, been deemed to have paid Permit Fees for all of the Subject Units, the Developer shall be deemed to have paid Permit Fees for a number of Subject Units equal to the lesser of (A) the number of Subject Units for which the Developer has not, pursuant to subsections (a) and (b) of this Section been deemed to have paid Permit Fees, and (B) the largest whole number that is not greater than the quotient of (I) the amounts so transferred to and deposited in the Construction Account pursuant to subsection (c) of Section 2.01 hereof, divided by (II) the Subject Unit Fee Amount as of the date such proceeds are so deposited.
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ARTICLE III

ACQUISITION OF ACQUISITION FACILITIES
Section 3.01. Acquisition of Acquisition Facilities. The Developer hereby agrees to sell to the Community Facilities District, and the Community Facilities District hereby agrees to purchase from the Developer, each Segment for the Purchase Price thereof, subject to the terms and conditions hereof. Title to each Segment purchased pursuant hereto shall be transferred by the Developer to the City as of the Acceptance Date of such Segment by appropriate instrument in accordance with the Conditions of Approval; provided, however, that notwithstanding such transfer, as provided in Section 4.06 hereof, the Developer shall be responsible for the maintenance of such Segment until the Acceptance Date of the Component of which such Segment is a part.

The parties hereto expect that, at some date after the execution hereof, the Community Facilities District will issue the Bonds. The Purchase Price of the Segments is to be paid from proceeds of the Special Tax available for such purpose, as provided in Section 2.01 hereof, and from proceeds of the Bonds deposited in the Acquisition Account, as provided in Section 2.01 hereof. The Community Facilities District shall not be obligated to pay the Purchase Price of the Segments except from such proceeds of the Special Tax and the Bonds. Neither the Community Facilities District nor the City makes any warranty, either express or implied, that such proceeds of the Special Tax and the Bonds available for the payment of the Purchase Price of the Segments will be sufficient for such purpose.

In the event that certain of the Segments are not purchased from the Developer pursuant to this Acquisition Agreement as a result of the proceeds of Special Taxes available for the purpose of paying the Purchase Price of Segments, as provided in subsection (a) of Section 2.01 hereof, plus the proceeds of the Bonds deposited in the Acquisition Account available for the purpose of paying the Purchase Price of Segments, as provided in subsection (b) of Section 2.01 hereof, not being sufficient to pay the Purchase Price of such Segments not so purchased, the Purchase Price for such Segments may be paid from the proceeds of special taxes or proceeds of bonds issued by one or more additional community facilities districts that may be formed by the City within the Project Property. Nothing herein shall obligate the City to form any such additional community facilities districts, the formations of which are at the sole discretion of the City Council, and the City provides no assurance that any such additional community facilities districts will be formed.

Section 3.02. Payment of Purchase Price. (a) In order to receive all or any portion of the Purchase Price for a Segment, the Developer shall deliver to the Community Facilities District and the City Engineer (i) a Payment Request for such Segment, together with all attachments and exhibits to be included therewith, (ii) a copy of the documents conveying, or which previously conveyed, to the City Acceptable Title to the Related Property of such Segment, as described in Section 3.04 hereof, and (iii) a copy of the Notice of Completion of such Segment that will be filed in accordance with Section 8182 of the California Civil Code, if applicable. (b) Upon receipt of a completed Payment Request (and accompanying documentation) for a Segment, the City Engineer shall conduct a review in order to confirm that such Segment is Complete and was constructed in accordance with the Plans therefor and to verify and approve the Actual Cost of such Segment specified in such Payment Request. The Developer agrees to 1862
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cooperate with the City Engineer in conducting each such review and to provide the City Engineer with such additional information and documentation as is reasonably necessary for the City Engineer to conclude each such review. The City agrees to cause the City Engineer to conduct such review without unreasonable delay. If the City Engineer determines that the Actual Cost specified in such Payment Request as initially submitted exceeds the Developer’s actual, reasonable cost of constructing such Segment, the Developer shall resubmit such Payment Request, with the Actual Cost specified therein modified so as to take into account such determination by the City Engineer. Upon confirmation that such Segment is Complete and has been constructed in accordance with the Plans therefor, and verification and approval of the Actual Cost of such Segment, the City Engineer shall sign the Payment Request, indicating thereon that the full amount of the Purchase Price of such Segment is to be paid, and forward the same to the Community Facilities District. Upon receipt of such reviewed and fully signed Payment Request, the Community Facilities District shall, without unreasonable delay, direct the Trustee to pay the full amount of the Purchase Price of such Segment to the Developer. (c) If, as a result of the review described in subsection (b), above, the City Engineer (i) determines that such Segment, while not Complete, is Substantially Complete, (ii) confirms that such Segment has been constructed in accordance with the Plans therefor, and (iii) verifies and approves the Actual Cost of such Segment, the City Engineer shall sign the Payment Request, indicating thereon that an amount equal to 90% of the lesser of (x) such Actual Cost, or (y) the Acquisition Cost of such Segment is to be paid, and forward the same to the Community Facilities District. Upon receipt of such reviewed and fully signed Payment Request, the Community Facilities District shall, without unreasonable delay, direct the Trustee to pay such amount to the Developer.

When the Developer completes or causes to be completed all work with respect to such Segment and concludes that such Segment is Complete, the Developer shall deliver to the City Engineer (i) if as-built drawings or similar plans and specifications for such Segment have not previously been submitted to the City Engineer, such drawings or plans and specifications, together with a certification of the Developer that such drawings or plans and specifications are true, correct and complete, and (ii) such information and documentation as is reasonably required by the City Engineer in order for the City Engineer to determine whether such Segment is Complete. Upon receipt of such information and documentation, the City Engineer shall conduct a review in order to confirm that such Segment is Complete. If, as a result of such review, the City Engineer determines that such Segment is Complete, the City Engineer shall sign a copy of the original Payment Request therefor, indicating thereon that an amount equal to the remainder of the (x) the Purchase Price of such Segment, less (y) the amount paid pursuant to the preceding paragraph is to be paid, and forward the same to the Community Facilities District. Upon receipt of such reviewed and fully signed Payment Request, the Community Facilities District shall, without unreasonable delay, direct the Trustee to pay such amount to the Developer.

Section 3.03. Payments of Credit Amount. If and when the amount of the Credit Amount is greater than zero, the Developer shall be entitled to be paid from the Acquisition Account an amount equal to the Credit Amount. In order to receive all or a portion of the Credit Amount, the Developer shall deliver to the Community Facilities District a written request signed by a Developer Representative stating (a) the amount to be paid, and (b) that such amount does not exceed the amount of the Credit Amount as of the date of delivery of such written request. 1863
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Such written request shall be accompanied by a calculation demonstrating the amount of the Credit Amount as of the date of delivery of such written request. Upon receipt of such written request and accompanying calculation, the Community Facilities District shall, without unreasonable delay, direct the Trustee to pay such amount from the Acquisition Account to the Developer.

Section 3.04. Dedication of Property and Easements to City. Acceptable Title to all property on, in or over which each Segment will be located shall be deeded over to the City by way of grant deed, quitclaim, or dedication of such property, or easement thereon, if such easement is approved by the City as being a sufficient interest therein to permit the City to properly own, operate and maintain such Segment located therein, thereon or thereover, and to permit the Developer to perform its obligations as set forth in this Acquisition Agreement.

Upon the request of the City, the Developer shall furnish to the City a title report for such property not previously dedicated or otherwise conveyed to the City or its designee, for review and approval at least 20 calendar days prior to the transfer of Acceptable Title to a Segment to the City or its designee. The City shall approve the title report unless it reveals a matter that, in the reasonable judgment of the City, could materially affect the City’s or its designee’s use and enjoyment of any part of the property or easement covered by the title report. In the event the City does not approve the title report, the City shall not be obligated to accept title to such Segment, and the Community Facilities District shall not be obligated to pay any portion of the Purchase Price for such Segment, until the Developer has cured such objections to title to the reasonable satisfaction of the City.

Section 3.05. Modifications to Segments and Acquisition Costs. The Community Facilities District, the City and the Developer may make modifications in the composition and description of a Segment or a Component, or in the amount of the Acquisition Cost for a Segment, whenever the Community Facilities District, the City and the Developer deem such modifications to be appropriate. Any such modification shall be approved and implemented by the City Manager or Deputy City Manager (on behalf of the Community Facilities District), the City Engineer (on behalf of the City) and the Developer executing a supplement to Exhibit A containing a description of the modified Segment or Component and, if applicable, Acquisition Cost of such Segment.

Upon the execution of any such supplement to Exhibit A, the description of the Segment or Component and, if applicable, the Acquisition Cost of such Segment in Exhibit A shall be deemed to have been modified in accordance therewith.
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ARTICLE IV

CONSTRUCTION OF ACQUISITION FACILITIES
Section 4.01. Preparation and Approval of Plans and Specifications. The Developer shall cause Plans to be prepared for the Acquisition Facilities in accordance with the Conditions of Approval. The Developer shall obtain the written approval of the Plans from all appropriate departments of the City or from any other public agency or public utility from which such approval must be obtained. Copies of all such Plans shall be provided by the Developer to the City Engineer.

Section 4.02. Duty of Developer to Construct. The Developer shall construct or cause to be constructed the Segments in accordance with the Conditions of Approval and the approved Plans. The Developer shall perform all of its obligations hereunder and shall conduct all operations with respect to the construction of the Segments in a good, workmanlike and commercially reasonable manner, with the standard of diligence and care normally employed by duly qualified persons utilizing commercially reasonable efforts in the performance of comparable work and in accordance with generally accepted practices appropriate to the activities undertaken. The Developer shall not be relieved of its obligation to construct a Segment, and convey such Segment to the City in accordance with the terms hereof, even if the Purchase Price for such Segment is less than the Actual Cost of such Segment. Notwithstanding the foregoing, nothing set forth in this Acquisition Agreement shall be construed to require the Developer to construct any Acquisition Facilities other than at the time required by, and in accordance with, the Conditions of Approval or to perform any work requiring a contractor’s license, nor shall the Developer be deemed to be performing construction services pursuant to this Acquisition Agreement.

Section 4.03. Public Works Requirements. (a) In order to ensure that the Segments that are acquired by the City pursuant to this Acquisition Agreement are constructed as if they had been constructed under the direction and supervision, or under the authority of, the City, so that they may be acquired pursuant to California Government Code Section 53313.5, the Developer shall comply with all of the requirements of this Section for each Segment for which the Developer submits a Payment Request.
(b) Bids for the construction of each Segment shall be obtained in conformance with the Public Improvement Policies, or as otherwise approved by the City Engineer in writing. (c) The contract for the construction of each Segment shall be awarded to the responsible bidder submitting the lowest responsive bid for the construction of such Segment. (d) The Developer shall require, and the specifications and bid and contract documents shall require, all contractors, subcontractors, vendors, equipment operators and owner operators, in each such case to the extent such Persons are engaged to perform work on a Segment, to pay at least General Prevailing Wage Rates to all workers employed in the execution of the contract, to post a copy of the General Prevailing Wage Rates at the job-site in a conspicuous place available to all employees and applicants for employment, and to otherwise comply with applicable provisions of the California Labor Code, the California Government Code and the California Public Contracts Code relating to public works projects of cities and as required by the Public 1865
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Improvement Policies. The City has provided the Developer with copies of tables setting forth the General Prevailing Wage Rates, and the Developer hereby acknowledges receipt thereof.

The Developer shall require, and the specifications and bid and contract documents shall require, for all contracts involving in excess of $30,000 or 20 working days, all contractors, subcontractors, vendors, equipment operators and owner operators, in each such case to the extent such Persons are engaged to perform work on a Segment, to comply with the provisions of Section 1777.5 of the California Labor Code with respect to all apprenticeable occupations upon the project.
(e) In performing its obligations under this Acquisition Agreement, the Developer shall comply with the applicable nondiscrimination and affirmative action provisions of the laws of the United States of America, the State and the City. In performing its obligations under this Acquisition Agreement, the Developer shall not discriminate in its employment practices against any employee, or applicant for employment, because of such person’s race, religion, national origin, ancestry, sex, sexual orientation, age, physical handicap, marital status or medical condition. The Developer shall require, in any contract it enters into for the construction of any Segment, that the contractor be subject to the provisions of this paragraph. (f) The Developer shall require each contractor, subcontractor, vendor, equipment operator and owner operator, in each such case to the extent such Person is engaged to perform work on a Segment, to provide proof of insurance coverage satisfying the requirements of Section

4.07 hereof throughout the term of the construction of such Segment; provided, however, that, rather than requiring such contractors, subcontractors, vendors, equipment operators and owner operators to provide such insurance, the Developer may elect to provide the same for the benefit of such contractors, subcontractors, vendors, equipment operators and owner operators. (g) The Developer shall comply, and shall cause each contractor, subcontractor, vendor, equipment operator and owner operator, in each such case to the extent such Person is engaged to perform work on a Segment, to comply, with such other requirements relating to the construction of the Segments as the City may impose by written notification delivered to the Developer, to the extent legally required as a result of changes in applicable federal, State or City laws or the Public Improvement Policies.
(h) The Developer shall require, and the specifications and bid and contract documents shall require, all contractors, subcontractors, vendors, equipment operators and owner operators, in each such case to the extent such Persons are engaged to perform work on a Segment, to submit certified weekly payroll records to the Developer for inspection by the City, and to furnish certified payroll records to the City promptly upon request.

The Developer shall provide proof to the City, at such intervals and in such form as the City may reasonably require, that the foregoing requirements have been satisfied as to all of the Segments.

Section 4.04. Bonding Requirements. Prior to the commencement of construction of a Segment, the Developer shall secure, or caused to be secured, appropriate bonds for the construction and completion of construction of such Segment, a faithful performance bond and a 1866
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bond for the security of laborers and materialmen, each in an amount that is equal to 100% of the contract price for such Segment. Each issuer of any such bond shall be duly authorized to issue such bond in the State. Each such bond shall comply with the provisions of California Government Code Sections 66499.1 and 66499.2.

Section 4.05. Inspection; Completion of Construction. The City shall have primary responsibility for providing inspection of the work of construction of the Segments to ensure that the work of construction is accomplished in accordance with the Plans. The City’s personnel shall have access to the site of the work of construction at all reasonable times for the purpose of accomplishing such inspection. Upon the completion of the construction of a Segment to the satisfaction of the City’s inspectors, the Developer shall notify the Community Facilities District, the City and the City Engineer in writing that the construction of such Segment has been completed in accordance with the Plans.

No later than ten days after receiving notification pursuant to Section 3.02 hereof that a Segment was constructed in accordance with the Plans therefor, the Developer shall forthwith file with the San Bernardino County Recorder a Notice of Completion, in form acceptable to the City Engineer, pursuant to the provisions of Section 8182 of the California Civil Code, if applicable.

The Developer shall furnish to the City and the Community Facilities District a duplicate copy of each such Notice of Completion showing thereon the date of filing with said County Recorder.

Section 4.06. Maintenance of Acquisition Facilities; Warranties. The Developer shall maintain each Segment in good and safe condition until the Acceptance Date of the Component of which such Segment is a part. Prior to the Acceptance Date of the Component of which such Segment is a part, the Developer shall be responsible for maintaining such Segment in proper operating condition, and shall perform such maintenance on such Segment as the City Engineer reasonably determines to be necessary. As of the Acceptance Date of the Component of which a Segment is a part, the performance bond provided by the Developer for such Segment pursuant to Section 4.04 hereof shall be reduced to an amount equal to 20% of the original amount thereof and shall serve as a warranty bond to guarantee that such Segment will be free from defects due to faulty workmanship or materials for a period of 12 months from the Acceptance Date of the Component of which such Segment is a part, or the Developer may elect to provide a new warranty bond in such an amount pursuant to the Public Improvement Policies. As of the Acceptance Date of the Component of which a Segment is a part, the Developer shall assign to the City all of the Developer’s rights in any warranties, guarantees, maintenance obligations or other evidence of contingent obligations of third Persons with respect to such Segment.

Section 4.07. Insurance Requirements. The Developer shall or, pursuant to Section

4.03(f) hereof, shall cause each contractor, subcontractor, vendor, equipment operator and owner operator, in each such case to the extent such Person is engaged to perform work on a Segment, to, at all times prior to the final Acceptance Date of all Segments, maintain, deliver to the City and keep in full force and effect, the following insurance policies:
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(a) a protective liability policy providing for not less than the following amounts:

Bodily Injury $1,000,000 each person
$2,000,000 each occurrence
$1,000,000 each accident for products
and completed operations
Property Damage $1,000,000 each accident
Worker’s Compensation Statutory
(b) Automobile Liability Insurance to include all owned, non-owned or nonhired vehicles, including loading and unloading thereof:

Automobile Bodily Injury $1,000,000 each person
$2,000,000 each occurrence
Automobile Property Damage $1,000,000 each accident
All liability insurance policies shall bear an endorsement or shall have attached a rider whereby it is provided that, in the event of expiration or proposed cancellation of such policies for any reason whatsoever, the City shall be notified by registered mail, return receipt requested, giving a sufficient time before the date thereof to comply with any applicable law or statute, but in no event less than 30 days before expiration or cancellation is effective.

The following statement shall be included on the insurance certificate:

Additional Insured: The insurer agrees that the City, its City Council, and/or all City Council appointed groups, committees, boards and any other City Council appointed body, and/or elective and appointive officers, servants, agents or employees of the City, when acting as such, are additional insureds hereunder, for the acts of the insured, and such insurance shall be primary to any insurance of the City.

The Developer may effect such coverage under blanket insurance policies, provided, however, that (a) such policies are written on a per occurrence basis, (b) such policies comply in all other respects with the provisions of this Section, and (c) the protection afforded the City under any such policy shall be no less than that that would be available under a separate policy relating only to the Segments. All policies of insurance shall be with companies licensed or approved by the California Commissioner of Insurance and rated B+5 or better in the most recent edition of Best’s Insurance Guide and shall be issued and delivered in accordance with State law and regulations.

If Developer fails to maintain or cause to be maintained any insurance required hereby, the City may, but shall not be obligated to, procure such insurance and recover the amount of the premiums therefor from the Developer or retain such amount from any monies due to the Developer under this Acquisition Agreement. The failure of the City to procure any such insurance shall in no way relieve the Developer of any of its obligations under this Acquisition Agreement. 1868
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Section 4.08. Ownership of Acquisition Facilities. Notwithstanding the fact that some or all of the Acquisition Facilities may be constructed in dedicated street rights-of-way or on property that has been or will be dedicated to the City, the Acquisition Facilities shall be and remain the property of the Developer until title thereto is conveyed to and accepted by the City as provided herein and in the Conditions of Approval. Such ownership by the Developer shall likewise not be affected by any agreement that the Developer may have entered into or may enter into with the City pursuant to the provisions of the Subdivision Map Act, Section 66410 et seq. of the California Government Code, and the provisions of this Section and the Conditions of Approval shall control.
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ARTICLE V
REPRESENTATIONS, WARRANTIES AND COVENANTS; INDEMNIFICATION Section 5.01. Representations and Warranties of the Developer. The Developer makes the following representations and warranties for the benefit of the Community Facilities District and the City:
(a) Organization. The Developer represents and warrants that the Developer is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware, is authorized to conduct business and is in good standing under the laws of the State, and has the power and authority to own its properties and assets and to carry on its business as now being conducted and as now contemplated. (b) Authority. The Developer represents and warrants that the Developer has the power and authority to enter into this Acquisition Agreement, and has taken all action necessary to cause this Acquisition Agreement to be executed and delivered, and this Acquisition Agreement has been duly and validly executed and delivered on behalf of the Developer.
(c) Binding Obligation. The Developer represents and warrants that this Acquisition Agreement is a valid and binding obligation of the Developer and is enforceable against the Developer in accordance with its terms, subject to bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors’ rights in general and by general equity principles.
(d) Environmental Matters Relating to Segments. The Developer represents and warrants that neither the Developer, nor any subcontractor, agent or employee of either thereof, has used, generated, manufactured, procured, stored, released, discharged or disposed of (whether accidentally or intentionally) any Hazardous Material on, under or in any Segment or the Related Property of such Segment, or transported (whether accidentally or intentionally) any Hazardous Material to or from such Segment or such Related Property, in violation of any federal, state or local law, ordinance, regulation, rule or decision regulating Hazardous Material.

The Developer represents and warrants that, as of the Acceptance Date of each Segment, there will not be present on, under or in such Segment or the Related Property of such Segment, or any portion thereof, any Hazardous Materials, except for (i) any types or amounts that do not require remediation or mitigation under federal, state or local laws, ordinances, regulations, rules or decisions, (ii) those that have been remediated or mitigated in full compliance with applicable federal, state or local laws, ordinances, regulations, rules or decisions, or (iii) those with respect to which ongoing remediation or mitigation is being performed in full compliance with applicable federal, state or local laws, ordinances, regulations, rules or decisions.
(e) Environmental Matters Relating to Property. The Developer represents and warrants that neither the Developer, nor any subcontractor, agent or employee of either 1870
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thereof, has used, generated, manufactured, procured, stored, released, discharged or disposed of (whether accidentally or intentionally) at any time on or prior to the date hereof any Hazardous Material on, under or in the Property, or any structure, fixtures, equipment, or other objects thereon, or transported (whether accidentally or intentionally) any Hazardous Material to or from the Property, or any structure, fixtures, equipment, or other objects thereon, in violation of any federal, state or local law, ordinance, regulation, rule or decision regulating Hazardous Material.

The Developer represents and warrants that the Developer has not received notice of, and, to the best of the Developer’s knowledge, there is not, any proceeding or formal inquiry by any governmental authority, body or agency with respect to the presence of Hazardous Materials on, under or in the Property, or any structure, fixtures, equipment, or other objects thereon, or the migration thereof from or to other property.

Section 5.02. Covenants of the Developer. The Developer makes the following covenants for the benefit of the Community Facilities District and the City:
(a) Completion of Segments. The Developer covenants that it will use its reasonable and diligent efforts to do all things that may be lawfully required of it in order to cause the Segments to be completed in accordance with this Acquisition Agreement and the Conditions of Approval.
(b) Compliance with Laws. The Developer covenants that, while the Acquisition Facilities are owned by the Developer or required pursuant to this Acquisition Agreement to be maintained by the Developer, it will not commit, suffer or permit any of its agents, employees or contractors to commit any act to be done in, upon or to the Acquisition Facilities in violation in any material respect of any law, ordinance, rule, regulation or order of any governmental authority or any covenant, condition or restriction now or hereafter affecting the Property or the Acquisition Facilities. (c) Payment Requests. The Developer covenants that (i) it will not request payment from the Community Facilities District under this Acquisition Agreement for the acquisition of any improvements that are not part of a Segment, and (ii) it will diligently follow all procedures set forth in this Acquisition Agreement with respect to Payment Requests.
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(d) Financial Records. Until the final Acceptance Date of the Acquisition Facilities, the Developer covenants to maintain proper books of record and account for the Acquisition Facilities and all costs related thereto. The Developer covenants that such accounting books will be maintained in accordance with generally accepted accounting principles, and will be available for inspection by the Community Facilities District and the City within a reasonable time after the Community Facilities District or the City submits a written request to the Developer requesting that such books be made available for inspection.
(e) Environmental Matters Relating to Segments. The Developer covenants that neither the Developer, nor any subcontractor, agent or employee thereof, will use, generate, manufacture, procure, store, release, discharge or dispose of (whether accidentally or intentionally) at any time on or prior to the Acceptance Date of each Segment any Hazardous Material on, under or in such Segment or the Related Property of such Segment, or transport (whether accidentally or intentionally) any Hazardous Material to or from such Segment or such Related Property, in violation of any federal, state or local law, ordinance, regulation, rule or decision regulating Hazardous Material in effect at the time of such use, generation, manufacturing, procurement, storage, release, discharge, disposal or transportation.
(f) Permits. The Developer covenants that it will obtain all governmental or other permits required to proceed with the construction of the Acquisition Facilities, and that it will pay all fees relating thereto that are required to be paid, in accordance with the Conditions of Approval.

Section 5.03. Representations and Warranties of the Community Facilities District and the City. The Community Facilities District and the City make the following representations and warranties for the benefit of the Developer:
(a) Authority. The Community Facilities District represents and warrants that the Community Facilities District has the power and authority to enter into this Acquisition Agreement, and has taken all action necessary to cause this Acquisition Agreement to be executed and delivered, and this Acquisition Agreement has been duly and validly executed and delivered on behalf of the Community Facilities District. The City represents and warrants that the City has the power and authority to enter into this Acquisition Agreement, and has taken all action necessary to cause this Acquisition Agreement to be executed and delivered, and this Acquisition Agreement has been duly and validly executed and delivered on behalf of the City.
(b) Binding Obligation. The Community Facilities District represents and warrants that this Acquisition Agreement is a valid and binding obligation of the Community Facilities District and is enforceable against the Community Facilities District in accordance with its terms. The City represents and warrants that this Acquisition Agreement is a valid and binding obligation of the City and is enforceable against the City in accordance with its terms.
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Section 5.04. Covenants of the Community Facilities District and the City. The Community Facilities District and the City make the following covenants for the benefit of the Developer:
(a) Completion of Segments. The City covenants that it will use its reasonable and diligent efforts to take all actions that may be lawfully required of it in issuing permits, processing and approving Plans and inspecting the Segments in accordance with this Acquisition Agreement.
(b) Payment Requests. Each of the Community Facilities District and the City covenants that it will diligently follow all procedures set forth in this Acquisition Agreement with respect to each Payment Request.
(c) Financial Records. Until the final Acceptance Date, the Community Facilities District covenants to maintain proper books of record and account for the Special Tax and the Bonds. The Community Facilities District covenants that such accounting books will be maintained in accordance with generally accepted accounting principles applicable to governmental entities, and will be available for inspection by the Developer within a reasonable time after the Developer submits a written request to the Community Facilities District requesting that such books be made available for inspection.

Section 5.05. Indemnification. The Developer agrees to protect, indemnify, defend and hold the Community Facilities District and the City, and their respective officers, employees and agents (the “Indemnified Parties”), and each of them, harmless from and against any and all claims, losses, expenses, suits, actions, decrees, judgments, awards, attorney’s fees, and court costs that any Indemnified Party may suffer or that may be sought against or recovered or obtained from any Indemnified Party as a result of or by reason of or arising out of or in consequence of (a) the issuance of the Bonds or the acquisition, construction, installation or financing of the Acquisition Facilities, (b) the untruth or inaccuracy of any representation or warranty made by the Developer in this Acquisition Agreement or in any certifications delivered by the Developer pursuant hereto or in connection with the issuance of the Bonds, (c) the release, threatened release, storage, treatment, transportation or disposal of any Hazardous Materials on, under, in, from or to any portion of the Property while such portion of the Property is owned by the Developer, and (d) any act or omission of the Developer or any of its subcontractors, or their respective officers, employees or agents, in connection with the Acquisition Facilities, including noncompliance with any covenants made by the Developer in this Acquisition Agreement. If the Developer fails to do so, the Community Facilities District and the City shall have the right, but not the obligation, to defend the same and charge all of the direct or incidental costs of such defense, including any fees or costs, to and recover the same from the Developer.

Upon receipt by an Indemnified Party of notice of any claim, loss, expense, suit, action, decree, judgment or award for which the Developer is obligated to protect, indemnify, defend and hold such Indemnified Party harmless pursuant to this Section, such Indemnified Party shall promptly notify the Developer in writing of such claim, loss, expense, suit, action, decree, judgment or award. Neither the Developer nor an Indemnified Party shall, without the other’s written consent, settle, compromise or consent to the entry of judgment with respect to any claim, 1873
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suit or action for which the Developer is obligated to protect, indemnify, defend and hold such Indemnified Party harmless pursuant to this Section.

No indemnification is required to be paid by the Developer for any claim, loss or expense (a) arising from the willful misconduct or negligence of an Indemnified Party, or (b) arising from the use or operation of a Segment after the Acceptance Date of the Component of which such Segment is a part, unless such claim, loss or expense results from the defective or improper design, acquisition, construction or installation of such Segment.

The provisions of this Section shall survive the termination of this Acquisition Agreement. 1874
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ARTICLE VI
TERMINATION; DAMAGES
Section 6.01. Termination by Agreement. This Acquisition Agreement may be terminated by written agreement of the Community Facilities District, the City and the Developer.

Upon such termination, the City may, but shall not be obligated to, complete the acquisition, construction and installation of any Segments not theretofore acquired from the Developer pursuant hereto, and the Community Facilities District and the City may use all or any portion of the monies in the Acquisition Account to pay for such acquisition, construction and installation.

In the event of such termination, the Developer shall have no claim or right to any further payments for the Purchase Price of any Segment except as otherwise may be provided in such written agreement.

Section 6.02. Termination by City. (a) The following events shall constitute grounds for the Community Facilities District and the City, at their option, to terminate this Acquisition Agreement, without the consent of the Developer:
(i) the Developer shall voluntarily file for reorganization or other relief under any Federal or state bankruptcy or insolvency law; (ii) the Developer shall have any involuntary bankruptcy or insolvency action filed against it, or shall suffer a trustee in bankruptcy or insolvency or receiver to take possession of the assets of Developer, or shall suffer an attachment or levy of execution to be made against the property it owns within the Community Facilities District unless, in any of such cases, such action, possession, attachment or levy shall have been terminated or released within 60 days after the commencement thereof; (iii) except to the extent that the Developer’s obligation to construct the Acquisition Facilities is excused pursuant to Section 6.05 hereof, the Developer shall abandon construction of the Acquisition Facilities that, as of the time of such abandonment, the Developer is required to construct or cause to be constructed in accordance with the Conditions of Approval (failure for a period of three consecutive months or failure for two periods of two consecutive months to undertake substantial work related to the construction of the Acquisition Facilities shall constitute a non-exclusive example of such abandonment);
(iv) the Developer shall breach any material covenant or default in the performance of any material obligation under this Acquisition Agreement, or any representation or warranty of the Developer set forth herein or in any certifications delivered by the Developer hereunder shall prove to have been false or misleading in any material respect when made or deemed made;
(v) the Developer shall transfer any of its rights or obligations under this Acquisition Agreement, without the prior written consent of the Community Facilities District and the City;
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(vi) the Developer shall have made any material misrepresentation or material omission in any written materials furnished in connection with any preliminary official statement, official statement or bond purchase contract that has not been corrected and is used in connection with the sale of any Bonds;
(vii) the Developer or any of its partners, permitted assigns or successors-ininterest under this Acquisition Agreement or any Affiliate of the Developer shall at any time bring any action, suit, proceeding, inquiry or investigation at law or in equity, before any court, regulatory agency, public board or body that in any way seeks to challenge or overturn the Community Facilities District, the levy of the Special Tax in accordance with the Rate and Method or the validity of the Bonds or the proceedings leading up to their issuance; provided, however, that the Developer or any of its partners, permitted assigns or successors-in-interest under this Acquisition Agreement or any Affiliate of the Developer that owns any of the Property may bring an action or suit contending that the Special Tax has not been levied in accordance with the methodology contained in the Rate and Method; (viii) the Developer shall materially fail to complete the Acquisition Facilities as contemplated by this Acquisition Agreement and the Conditions of Approval; or (ix) the Developer or any of its partners, permitted assigns or successors-ininterest under this Acquisition Agreement or any Affiliate of the Developer shall fail to pay any Special Tax levied on the Property owned by such party prior to such Special Tax becoming delinquent.
(b) If any event listed in paragraph (i), (ii) or (vii) of subsection (a) of this Section occurs, this Acquisition Agreement shall automatically terminate. (c) If any event listed in paragraph (iii), (iv), (v), (vi), (viii) or (ix) of subsection (a) of this Section occurs, the Community Facilities District and the City may elect to terminate this Acquisition Agreement. If the Community Facilities District and the City intend to terminate this Acquisition Agreement, the Community Facilities District and the City shall first notify the Developer in writing of such intention and of the grounds for such termination and allow the Developer 60 days to eliminate or mitigate to the reasonable satisfaction of the Community Facilities District and the City the grounds for such termination. If, in the reasonable opinion of the Community Facilities District and the City, such grounds for termination can be eliminated or mitigated, but not within such 60 day period, such period shall be extended in order to provide a reasonably sufficient amount of time to accomplish such elimination or mitigation, but only if the Developer has instituted corrective action within such 60 day period and the Developer is thereafter proceeding with diligence to eliminate or mitigate such grounds for termination. If at the end of such period (and any extension thereof), the Developer has not eliminated or completely mitigated such grounds for termination to the reasonable satisfaction of the Community Facilities District and the City, the Community Facilities District and the City may then terminate this Acquisition Agreement by delivering a written notice of such termination to the Developer. If any of the grounds listed in said paragraph (iii), (iv), (v), (vi), (viii) or (ix) for termination of this Acquisition Agreement by the Community Facilities District and the City (A) has occurred, and (B) has not been eliminated or mitigated to the reasonable satisfaction of the Community Facilities District and the City or waived by the Community Facilities District and the City, the Community Facilities 1876
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District, from and after the occurrence thereof, shall have no obligation to acquire any Segment pursuant hereto.

Section 6.03. Termination by Developer. (a) The following events shall constitute grounds for the Developer, at its option, to terminate this Acquisition Agreement, without the consent of the Community Facilities District or the City:
(i) the City or the Community Facilities District shall voluntarily file for reorganization or other relief under any Federal or state bankruptcy or insolvency law; (ii) the City or the Community Facilities District shall have any involuntary bankruptcy or insolvency action filed against it, or shall suffer a trustee in bankruptcy or insolvency or receiver to take possession of the assets of the City or the Community Facilities District, as applicable, or shall suffer an attachment or levy of execution to be made against the property it owns unless, in any of such cases, such action, possession, attachment or levy shall have been terminated or released within 60 days after the commencement thereof;
(iii) the Community Facilities District or the City shall breach any material covenant or default in the performance of any material obligation under this Acquisition Agreement, or any representation or warranty of the Community Facilities District or the City set forth herein shall prove to have been false or misleading in any material respect when made; and
(iv) the Community Facilities District or the City shall transfer any of its respective rights or obligations under this Acquisition Agreement, without the prior written consent of the Developer;
(b) If any event listed in subsection (a) of this Section occurs, the Developer may elect to terminate this Acquisition Agreement. If the Developer intends to terminate this Acquisition Agreement, the Developer shall first notify the Community Facilities District and the City in writing of such intention and of the grounds for such termination and allow the Community Facilities District and the City 60 days to eliminate or mitigate to the reasonable satisfaction of the Developer the grounds for such termination. If, in the reasonable opinion of the Developer, such grounds for termination can be eliminated or mitigated, but not within such 60 day period, such period shall be extended in order to provide a reasonably sufficient amount of time to accomplish such elimination or mitigation, but only if the Community Facilities District and the City have instituted corrective action within such 60 day period and the Community Facilities District and the City are thereafter proceeding with diligence to eliminate or mitigate such grounds for termination. If at the end of such period (and any extension thereof), the Community Facilities District and the City have not eliminated or completely mitigated such grounds for termination to the reasonable satisfaction of the Developer, the Developer may then terminate this Acquisition Agreement by delivering a written notice of such termination to the Community Facilities District and the City.

Section 6.04. Remedies in General; Damages Limited. (a) The Developer acknowledges that neither the Community Facilities District nor the City would have entered into 1877
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this Acquisition Agreement if it were to be liable in damages under or with respect to this Acquisition Agreement. The only obligations of the Community Facilities District and the City hereunder to pay amounts or provide funding are the obligations to apply proceeds of the Special Tax and proceeds of the Bonds as provided in Section 2.01 hereof, to pay the Purchase Price of the Segments and any Credit Amount from amounts on deposit in the Acquisition Account, as provided in Section 3.02 hereof and Section 3.03 hereof, respectively and to pay amounts pursuant to Section 7.08 hereof, if and to the extent required by said Section. Neither the Community Facilities District nor the City shall have any pecuniary liability under this Acquisition Agreement for any act or omission of the Community Facilities District or the City, except as set forth in this Section. In no event will an act, or an omission or failure to act, by the Community Facilities District or the City with respect to the sale or proposed sale of the Bonds subject the Community Facilities District or the City to pecuniary liability therefor. (b) In general, each of the parties hereto may pursue any remedy at law or equity available for the breach of any provision of this Acquisition Agreement; provided, however, that the Community Facilities District and the City shall not be liable in damages to the Developer, other than to the extent that remedying a failure to perform an obligation specified in subsection (a) of this Section might be considered direct damages, and, in no case shall the Community Facilities District or the City be liable for any special, exemplary, consequential or punitive damages. In light of the foregoing, the Developer covenants not to sue for or claim any damages, for any alleged breach of, or dispute that arises out of, this Acquisition Agreement, other than to the extent that remedying a failure to perform an obligation specified in subsection (a) of this Section might be considered direct damages.

Section 6.05. Force Majeure. Except as may be specifically provided in this Acquisition Agreement, the performance by the Community Facilities District, the City or the Developer of its respective obligations hereunder shall be excused during, and the period of time for performance of its respective obligations hereunder shall be extended for a period of time equal to, any period of delay caused by reason of (a) acts of God or civil commotion, (b) riots, strikes, picketing or other labor disputes, (c) shortages of materials or supplies, (d) damage to work in progress by reason of fire, floods, earthquakes or other casualty, (e) enactment of laws that prevent or preclude compliance by the Community Facilities District, the City or the Developer with a material provision of this Acquisition Agreement, (f) administrative proceedings challenging the Community Facilities District, the Bonds, this Acquisition Agreement or a Payment Request brought by Persons other than the Community Facilities District, the City or the Developer, or any Affiliate thereof, (g) litigation (including the pendency thereof), brought by Persons other than the Community Facilities District, the City or the Developer, or any Affiliate thereof, including, without limitation, litigation challenging the Community Facilities District, the development of the Property, the Bonds, this Acquisition Agreement, a Payment Request, (h) pendency of initiatives or referenda affecting the Community Facilities District, the development of the Property, the Bonds, this Acquisition Agreement or a Payment Request, or (i) any other cause beyond the reasonable control of the Community Facilities District, the City or the Developer, respectively; provided, however that, as to any party (x) the financial inability of such party itself to perform under this Acquisition Agreement, and (y) the negligence or willful misconduct of such party shall not constitute a permitted delay for purposes of this Section and, provided, further, that any action, omission, or failure to approve a Payment Request or other approval, or the imposition of additional requirements or restrictions in connection therewith by the Community Facilities 1878
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District or the City, caused by the Developer’s actual failure to comply with applicable laws or regulations or the provisions of this Acquisition Agreement (other than an actual failure to comply that results from the enactment of laws that prevent or preclude compliance by a party with a material provision of this Acquisition Agreement, administrative proceedings challenging the Community Facilities District, the Bonds, this Acquisition Agreement or a Payment Request or other approval, litigation brought by persons other than a party, or an Affiliate of a party, including without limitation, litigation challenging the Community Facilities District, the development of the Property, the Bonds, this Acquisition Agreement or a Payment Request or other approval, initiative or referenda affecting the Community Facilities District, the development of the Property, the Bonds, this Acquisition Agreement or a Payment Request or other approval), shall not constitute a permitted delay for the Developer for purposes of this Section.

If the Community Facilities District, the City or the Developer shall claim that performance of its respective obligations hereunder is excused by a permitted delay pursuant to this Section, such party shall give the other parties hereto written notice of the commencement of such permitted delay within 30 days after first gaining knowledge of such permitted delay.

If the Community Facilities District, the City or the Developer shall claim that performance of its respective obligations hereunder is excused by a permitted delay pursuant to this Section, such party’s performance shall only be excused during, and the period of time for performance of its obligations hereunder shall only be extended for a period of time equal to, the period of time for which the cause of such permitted delay is in effect and is actually causing a delay in performance by such party of its obligations hereunder.

The Community Facilities District, the City and the Developer shall act diligently and in good faith to avoid foreseeable delays in performance and to remove the cause of any permitted delay under this Section or develop a reasonable alternative means of performance of its respective obligations hereunder.
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ARTICLE VII

MISCELLANEOUS
Section 7.01. Developer as Independent Contractor. In performing under this Acquisition Agreement, it is mutually understood that the Developer is acting as an independent contractor, and not an agent of the Community Facilities District or the City. Neither the Community Facilities District nor the City shall have any responsibility for payment to any contractor, subcontractor or supplier of the Developer.

Section 7.02. Other Agreements. Nothing contained herein shall be construed as affecting the City’s or the Developer’s respective duty to perform its respective obligations under other agreements, land use regulations or subdivision requirements relating to the development of the Property, which obligations are and shall remain independent of the Developer’s rights and obligations, and the City’s rights and obligations, under this Acquisition Agreement; provided, however, that the Developer shall use its reasonable and diligent efforts to perform each and every covenant to be performed by it under any lien or encumbrance, instrument, declaration, covenant, condition, restriction, license, order, or other agreement, the nonperformance of which could reasonably be expected to materially and adversely affect the acquisition, construction and installation of the Segments.

Section 7.03. Binding on Successors and Assigns. Neither this Acquisition Agreement nor the duties and obligations of the Developer hereunder may be assigned to any Person without the written consent of the Community Facilities District and the City, which consent shall not be unreasonably withheld or delayed. Neither this Acquisition Agreement nor the duties and obligations of the City or the Community Facilities District hereunder may be assigned to any Person, without the written consent of the Developer, which consent shall not be unreasonably withheld or delayed. The agreements and covenants included herein shall be binding on and inure to the benefit of any partners, permitted assigns, and successors-in-interest of the parties hereto.

Section 7.04. Amendments. This Acquisition Agreement may be amended by an instrument in writing executed and delivered by the Community Facilities District, the City and the Developer.

Section 7.05. Waivers. No waiver of, or consent with respect to, any provision of this Acquisition Agreement by a party hereto shall in any event be effective unless the same shall be in writing and signed by such party, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which it was given.

Section 7.06. No Third-Party Beneficiaries. No person or entity shall be deemed to be a third-party beneficiary hereof, and nothing in this Acquisition Agreement (either express or implied) is intended to confer upon any person or entity, other than the Community Facilities District, the City and the Developer (and their respective successors and assigns), any rights, remedies, obligations or liabilities under or by reason of this Acquisition Agreement.

Section 7.07. Notices. Any written notice, statement, demand, consent, approval, authorization, offer, designation, request or other communication to be given hereunder shall be 1880
31 4165-9371-5022.3
given to the party entitled thereto at its address set forth below, or at such other address as such party may provide to the other party in writing from time to time, namely:

Community Facilities District: City of Fontana Community Facilities District No. 113 (The Gardens Phase Two)
c/o City of Fontana
8353 Sierra Avenue
Fontana, California 92335
Attention: City Clerk
City: City of Fontana
8353 Sierra Avenue
Fontana, California 92335
Attention: Chief Financial Officer, Finance Department
Developer: North Fontana Investment Company, LLC
c/o Lewis Operating Corp.
1156 North Mountain Avenue
Upland, California 91786
Attention: Stacey Sassaman, Vice President
Each such notice, statement, demand, consent, approval, authorization, offer, designation, request or other communication hereunder shall be deemed delivered to the party to whom it is addressed (a) if given by courier or delivery service or if personally served or delivered, upon delivery, (b) if given by registered or certified mail, return receipt requested, deposited with the United States mail postage prepaid, 72 hours after such notice is deposited with the United States mail, (c) if given by electronic mail, on the date sent, but only if confirmation of the receipt of such electronic mail is received or if notice is concurrently sent by another means specified herein, and (d) if given by any other means, upon delivery at the address specified in this Section.

Section 7.08. Attorneys’ Fees. If any action is instituted to interpret or enforce any of the provisions of this Acquisition Agreement, the party prevailing in such action shall be entitled to recover from the other party thereto reasonable attorney’s fees and costs of such suit (including both prejudgment and postjudgment fees and costs) as determined by the court as part of the judgment.

Section 7.09. Jurisdiction and Venue. Each of the Community Facilities District, the City and the Developer (a) agrees that any suit, action or other legal proceeding arising out of or relating to this Acquisition Agreement shall be brought in a state or local court in the County of San Bernardino or in the Courts of the United States of America in the district in which said county is located, (b) consents to the jurisdiction of each such court in any such suit, action or proceeding, and (c) waives any objection that it may have to the laying of venue of any suit, action or proceeding in any of such courts and any claim that any such suit, action or proceeding has been brought in an inconvenient forum. Each of the Community Facilities District, the City and the Developer agrees that a final and non-appealable judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.
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Section 7.10. Governing Law. This Acquisition Agreement and any dispute arising hereunder shall be governed by and interpreted in accordance with the laws of the State.

Section 7.11. Electronic Signature. Each of the parties hereto agrees that the transaction consisting of this Acquisition Agreement may be conducted by electronic means. Each party agrees, and acknowledges that it is such party’s intent, that if such party signs this Acquisition Agreement using an electronic signature, it is signing, adopting and accepting this Acquisition Agreement and that signing this Acquisition Agreement using an electronic signature is the legal equivalent of having placed its handwritten signature on this Acquisition Agreement on paper.

Each party acknowledges that it is being provided with an electronic or paper copy of this Acquisition Agreement in a usable format.

Section 7.12. Usage of Words. As used herein, the singular of any word includes the plural, and terms in the masculine gender shall include the feminine.

Section 7.13. Counterparts. This Acquisition Agreement may be executed in counterparts, each of which shall be deemed an original.

Section 7.14. Effective Date. This Acquisition Agreement has been dated for convenience purposes only. Notwithstanding the stated date of this Acquisition Agreement, this Acquisition Agreement shall be effective on the Effective Date. 1882
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EXHIBIT A

ACQUISITION FACILITIES
Segment/Component
Acquisition
Cost
Street Improvements
Sierra Avenue. Approximately 2,640 LF of asphalt paving, sidewalks, streetlights, signage and striping, and related improvements on the west side of Sierra Avenue between Casa Grande to Duncan Canyon Road. $2,002,144
Casa Grande Avenue. Approximately 1,300 LF of asphalt paving, sidewalks, streetlight, signage and striping, and related improvements on the north side of Casa Grande Avenue between the westerly boundary of Tr. 20362 and Sierra Avenue.
$231,838
Cypress Avenue. Approximately 1,960 LF of asphalt paving, sidewalks, streetlight, signage and striping, and related improvements on the east side of Cypress Avenue between the southerly boundary of Tr. 20362 and Duncan Canyon Road.
$1,244,144
Duncan Canyon Road. Approximately 2,640 LF of asphalt paving, sidewalks, streetlight, signage and striping, and related improvements on the south side of Duncan Canyon Road between Cypress Avenue and Sierra Avenue. $1,263,104
Cassava Drive, Fieldcress Drive, Gardens Street, and Montelena Road.

Approximately 5,280 LF of asphalt paving, sidewalks, streetlight, signage and striping, and related improvements for collector streets. $2,472,732
Subtotal $7,213,962
Sewer Improvements
Cypress Avenue. Approximately 62 LF of sewer main, manholes, and appurtenances within Cypress Avenue between the southerly boundary of Tr. 20362 and Duncan Canyon Road.
$240,523
Cassava Drive, Fieldcress Drive, Gardens Street, and Montelena Road.

Approximately 4,600 LF of sewer main, manholes, and appurtenances within the collector streets.
$1,204,480
Subtotal $1,445,003
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Segment/Component
Acquisition
Cost
Storm Drain Improvements
Sierra Avenue. Approximately 2,600 LF of storm drain mainline, laterals, and appurtenances within Sierra Avenue between Casa Grande and Duncan Canyon Road.
$2,111,589
Cypress Avenue. Approximately 1,900 LF of storm drain mainline, laterals, and appurtenances within Cypress Avenue between the southerly boundary of Tr. 20362 and Duncan Canyon Road.
$1,024,839
Duncan Canyon Road. Approximately 1,020 of storm drain mainline, laterals, and appurtenances within Duncan Canyon Road between Arboretum Avenue and Sierra Avenue.
$895,813
Cassava Drive, Fieldcress Drive, Gardens Street, and Montelena Road.

Approximately 6,800 LF of storm drain mainline, laterals and appurtenances within the collector streets.
$3,524,506
Subtotal $7,556,747
Landscape Improvements
Sierra Avenue. Approximately 2,640 LF of plant materials, irrigation, monumentation, and ancillary improvements on the west side of Sierra Avenue between Casa Grande Avenue and Duncan Canyon Road.
$2,633,967
Casa Grande Avenue. Approximately 1,300 LF of plant materials, irrigation, monumentation, and ancillary improvements on the north side of Casa Grande Avenue between the westerly boundary of Tr. 20362 and Sierra Avenue. $899,940
Cypress Avenue. Approximately 1,960 LF of plant materials, irrigation, monumentation, and ancillary improvements on the east side of Cypress Avenue between the southerly boundary of Tr. 20362 and Duncan Canyon Road.
$1,423,924
Duncan Canyon Road. Approximately 2,640 LF of plant materials, irrigation, monumentation, and ancillary improvements on the south side of Duncan Canyon Road between Cypress Avenue and Sierra Avenue.
$1,456,572
Subtotal $6,414,403
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Segment/Component
Acquisition
Cost
Traffic Signal Improvements
Casa Grande Avenue and Cypress Traffic Signal including all appurtenances. $584,250 Duncan Canyon Road and Sierra Avenue Traffic Signal including all appurtenance and interconnect systems. $1,310,215
Duncan Canyon Road and Cassava Drive Traffic Signal including all appurtenance and interconnect systems. $1,000,000
Subtotal $2,894,465
Rights of Way
Street Right of Way at APN 0239-081-38 (North side of Duncan Canyon Road between Citrus and Cypress Avenues). $52,074
Street Right of Way at APN 1118-031-01 (Southeast Corner of Duncan Canyon Road and Sierra Avenue). $5,000
Street Right of Way at APN 0239-081-23 and 0239-081-24 (Northwest Corner of Duncan Canyon Road and Sierra Avenue). $188,387
Subtotal $245,461
TOTAL: $25,770,041
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EXHIBIT B

FORM OF PAYMENT REQUEST
City of Fontana
Community Facilities District No. 113
(The Gardens Phase Two)
North Fontana Investment Company, LLC (the “Developer”), hereby requests payment of the Purchase Price of the Segment or Segments described in Attachment A attached hereto.

Capitalized undefined terms shall have the meanings ascribed thereto in the Acquisition and Funding Agreement, dated as of May 1, 2024 (the “Acquisition Agreement”), by and among City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) (the “Community Facilities District”), the City of Fontana (the “City”), and the Developer. In connection with this Payment Request, the undersigned hereby represents and warrants to the Community Facilities District and the City as follows:

1. The undersigned is a Developer Representative, qualified to execute this request for payment on behalf of the Developer and knowledgeable as to the matters set forth herein.

2. The Developer has submitted or submits herewith to the City Engineer as-built drawings or similar plans and specifications for the Segments for which payment is requested, and such drawings or plans and specifications, as applicable, are true, correct and complete; provided, however, that if such Segment is Substantially Complete but not Complete, such drawings or plans and specifications need not be submitted to the City Engineer until such Segment is Complete.

3. Each of the Segments described in Attachment A has been constructed in accordance with the Plans therefor, and in accordance with all applicable City standards and the requirements of the Acquisition Agreement, and the as-built drawings or similar Plans and specifications referenced in paragraph 2 above.

4. The true and correct Actual Cost of each Segment for which payment is requested is set forth in Attachment A.

6. The Developer has submitted or submits herewith to the City Engineer invoices, receipts, worksheets and other evidence of costs that are in sufficient detail to allow the City Engineer to verify the Actual Cost of each Segment for which payment is requested.

7. There has not been filed with or served upon the Developer notice of any lien, right to lien or attachment upon, or claim affecting the right to receive the payment requested herein that has not been released or will not be released simultaneously with the payment of such obligation, other than materialmen’s or mechanics’ liens accruing by operation of law. Copies of lien releases for all work for which payment is requested hereunder are attached hereto.

8. No event listed in subsection (a) of Section 6.02 of the Acquisition Agreement has occurred and is continuing or will occur upon the making of any payment requested hereunder. 1887
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9. The representations and warranties of the Developer set forth in Section 5.01 of the Acquisition Agreement are true and correct on and as of the date hereof with the same force and effect as if made on and as of the date hereof (except that no certification is made with respect to the representations and warranties contained in subsections (d) and (e) of said Section 5.01).

10. The Developer represents and warrants that, as of the date hereof, there is not present on, under or in any Segment described in Attachment A or the Related Property of such Segment, or any portion thereof, any Hazardous Materials, except for (i) any types or amounts that do not require remediation or mitigation under federal, state or local laws, ordinances, regulations, rules or decisions, (ii) those that have been remediated or mitigated in full compliance with applicable federal, state or local laws, ordinances, regulations, rules or decisions, (iii) those with respect to which ongoing remediation or mitigation is being performed in full compliance with applicable federal, state or local laws, ordinances, regulations, rules or decisions or (iv) any types or amounts that do not present a human health risk or hazard to the public.

I hereby declare under penalty of perjury that the above representations and warranties are true and correct.

Date: NORTH FONTANA INVESTMENT

COMPANY, LLC,
a Delaware limited liability company
By:

Name: ______________________________
Title:
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APPROVAL BY THE CITY ENGINEER
[The City Engineer has confirmed that each Segment described in Attachment A is Complete and was constructed in accordance with the Plans therefor and the Actual Cost of each Segment described in Attachment A has been reviewed, verified and approved by the City Engineer. Payment of the full Purchase Price of each such Segment is hereby approved.] [The City Engineer has confirmed that each Segment described in Attachment A is Substantially Complete and was constructed in accordance with the Plans therefor and the Actual Cost of each Segment described in Attachment A has been reviewed, verified and approved by the City Engineer. Payment of $_______, an amount equal to 90% of the sum of the lesser of (a) the Actual Cost, or (b) the Acquisition Cost of each such Segment is hereby approved.] [The City Engineer previously confirmed that each Segment described in Attachment A was Substantially Complete and previously approved the payment of $_______, an amount equal to the sum of the lesser of (a) the Actual Cost, or (b) the Acquisition Cost of each Segment described in Attachment A. The City Engineer has now confirmed that each Segment described in Attachment A is Complete and was constructed in accordance with the Plans therefor and the Actual Cost of each Segment described in Attachment A has been reviewed, verified and approved by the City Engineer. Payment of $_______, an amount equal to the sum of the remainder of (a) the Purchase Price of each such Segment, less (b) the amount previously paid with respect to such Segment is hereby approved.]
Date: CITY ENGINEER OF THE CITY OF

FONTANA
By:
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ATTACHMENT A
Segment Acquisition Cost Actual Cost Purchase Price*
Total Purchase Price to be Paid:
_________________________
*Lesser of Acquisition Cost or Actual Cost
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LETTER OF CREDIT AGREEMENT
by and between

CITY OF FONTANA
COMMUNITY FACILITIES DISTRICT NO. 113
(THE GARDENS PHASE TWO)
and

NORTH FONTANA INVESTMENT COMPANY, LLC
Dated as of May 1, 2024
City of Fontana
Community Facilities District No. 113
(The Gardens Phase Two)
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TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS ................................................................................................. 2 Section 1.1. Definitions...................................................................................................... 2 ARTICLE II SECURITY FOR PAYMENT OF SPECIAL TAX ........................................ 6 Section 2.1. Developer Letter of Credit ............................................................................. 6 Section 2.2. Transferred Parcel Letter of Credit ................................................................ 8 Section 2.3. No Contest to Foreclosure ........................................................................... 11 ARTICLE III REPRESENTATIONS AND WARRANTIES.............................................. 12 Section 3.1. Representations and Warranties of the Developer ....................................... 12 Section 3.2. Representations and Warranties of the Community Facilities District ........ 13 ARTICLE IV MISCELLANEOUS ...................................................................................... 14 Section 4.1. Binding on Successors and Assigns ............................................................. 14 Section 4.2. Amendments ................................................................................................ 14 Section 4.3. Waivers ........................................................................................................ 14 Section 4.4. Third Party Beneficiaries ............................................................................. 14 Section 4.5. Notices ......................................................................................................... 14 Section 4.6. Attorneys’ Fees ............................................................................................ 15 Section 4.7. Jurisdiction and Venue ................................................................................. 15 Section 4.8. Governing Law ............................................................................................ 15 Section 4.9. Electronic Signature ..................................................................................... 15 Section 4.10. Usage of Words.......................................................................................... 15 Section 4.11. Counterparts ............................................................................................... 15 Section 4.12. Effective Date ............................................................................................ 15 1892
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LETTER OF CREDIT AGREEMENT
THIS LETTER OF CREDIT AGREEMENT (this “Agreement”), dated as of May 1, 2024, is by and between CITY OF FONTANA COMMUNITY FACILITIES DISTRICT NO. 113 (The Gardens Phase Two), a community facilities district organized and existing under the laws of the State of California (the “Community Facilities District”), and NORTH FONTANA INVESTMENT COMPANY, LLC, a limited liability company organized and existing under the laws of the State of Delaware (the “Developer”).

W I T N E S S E T H:

WHEREAS, the Community Facilities District has been established under the provisions of the Mello-Roos Community Facilities Act of 1982;
WHEREAS, it is anticipated that, in order to finance certain public facilities, the Community Facilities District will issue bonds (the “Bonds”) secured by a special tax (the “Special Tax”) levied within the Community Facilities District;
WHEREAS, the Developer and Richmond American Homes of Maryland, Inc. (“Richmond American”) are the owners of the property within the Community Facilities District; WHEREAS, the Developer and Richmond American propose to construct residential units on the property within the Community Facilities District and to market and sell such residential units;
WHEREAS, it is contemplated that the property within the Community Facilities District may be substantially undeveloped at the time the Bonds are issued and that, as a result, a significant portion of the Special Tax securing the Bonds would be levied on undeveloped property; and WHEREAS, in order to increase the credit quality of the Bond issue, the Community Facilities District may require, as a condition to the issuance of the Bonds, that the Developer provide a letter of credit securing the payment of the Special Tax levied on certain of such undeveloped property within the Community Facilities District; NOW, THEREFORE, for and in consideration of the mutual promises and covenants contained herein, the parties hereto agree as follows:
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ARTICLE I

DEFINITIONS
Section 1.1. Definitions. All terms defined in the Indenture shall have the same meaning in this Agreement, except as indicated. Unless the context otherwise requires, the terms defined in this Article I shall have the meanings herein specified:
“Affiliate” of another Person means (a) each Person that, directly or indirectly, owns or controls, whether beneficially or as trustee, guardian, or other fiduciary, 50% or more of any class of equity securities of such other Person, and (b) each Person that controls, is controlled by or is under common control with or by such Person or any Affiliate of such Person. For the purpose of this definition, “control” of a Person shall mean the possession, directly or indirectly, of the power to direct or cause the direction of its management or policies, whether through the ownership of voting securities, by contract or otherwise.
“Agreement” means this Letter of Credit Agreement, dated as of May 1, 2024, by and between the Community Facilities District and the Developer, as originally executed or as the same may be amended from time to time in accordance with its terms. “Annual Debt Service” means, for each Bond Year, the sum of (a) the interest due on the outstanding Bonds in such Bond Year, assuming that the outstanding Bonds are retired as scheduled (including by reason of mandatory sinking fund redemptions), and (b) the principal amount of the outstanding Bonds due in such Bond Year (including any mandatory sinking fund redemptions due in such Bond Year).
“Bond Year” has the meaning ascribed thereto in the Indenture. “Bonds” means the City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) Special Tax Bonds issued under the Indenture. “City” means the City of Fontana, a general law city organized and existing under the laws of the State, and its successors.
“Closing Date” means the date on which the Bonds are issued and delivered to the initial purchaser thereof.
“Community Facilities District” means City of Fontana Community Facilities District No. 113 (The Gardens Phase Two), a community facilities district organized and existing under the laws of the State, and its successors.
“Developer” means North Fontana Investment Company, LLC, a limited liability company organized and existing under the laws of the State of Delaware, and its successors and assigns
“Developer Letter of Credit” means an irrevocable letter of credit that (a) is issued by a financial institution authorized to do business in the State of California, the long-term unsecured obligations of which, at the time of delivery of such letter of credit, are rated not less than “Aa2” 1894
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by Moody’s or not less than “A” by S&P, (b) has terms and provisions that make it suitable for the purposes of, and facilitate its use in accordance with, the provisions of the Indenture and Section

2.1 hereof, which terms and provisions are reasonably acceptable to the Community Facilities District, (c) is delivered to and accepted by the Trustee pursuant to the Indenture and Section 2.1(a) hereof, and (d) is for a term of at least one year; provided, however, that upon the acceptance by the Trustee of a Substitute Letter of Credit in substitution of the Developer Letter of Credit in accordance with the Indenture and Section 2.1(e) hereof, such term shall mean such Substitute Letter of Credit.
“Developer Secured Parcels” means, as of any date, all Remaining Parcels that are owned by any of the Developer or an Affiliate thereof or Richmond American or an Affiliate thereof, and all Transferred Parcels, excluding Secured Transferred Parcels. “Effective Date” means May 14, 2024.
“Hazardous Material” means any hazardous or toxic substance, material or waste which is regulated by any local governmental authority, the State or the United States Government, including, without limitation, any material or substance which is (a) designated as a “hazardous substance” pursuant to Section 311 of the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq. (33 U.S.C. § 1321), (b) defined as a “hazardous waste” pursuant to Section 1004 of the Federal Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq. (42 U.S.C. § 6903), (c) defined as a “hazardous substance” pursuant to Section 101 of the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. § 9601 et seq., (d) petroleum, or (e) asbestos.
“Indenture” means the indenture, by and between the Community Facilities District and the Trustee, pursuant to which the Bonds are issued, as originally executed or as the same may from time to time be supplemented or amended by any supplemental indenture entered into pursuant to the provisions thereof or, if such Indenture has been discharged in accordance with its terms, the indenture, trust agreement, fiscal agent agreement or similar instrument, regardless of title, pursuant to which bonds, notes or other evidences of indebtedness of the Community Facilities District have been issued and are outstanding, as originally executed or as the same may from time to time be supplemented or amended pursuant to the provisions thereof. “Letter of Credit Provider” means (a) with respect to the Developer Letter of Credit, the issuer of the Developer Letter of Credit, and its successors and assigns, or the issuer of a Substitute Letter of Credit substituted for the Developer Letter of Credit in accordance with the Indenture and Section 2.1(e) hereof, and (b) with respect to a Transferred Parcel Letter of Credit, the issuer of such Transferred Parcel Letter of Credit, and its successors and assigns, or the issuer of a Substitute Letter of Credit substituted for such Transferred Parcel Letter of Credit in accordance with the Indenture and Section 2.2(e) hereof.
“Maximum Annual Debt Service” means the largest Annual Debt Service for any Bond Year, including the Bond Year the calculation is made.
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“Person” means an individual, a corporation, a partnership, an association, a limited liability company, a joint stock company, a trust, any unincorporated organization or a government or political subdivision thereof.
“Property” means the real property located within the Community Facilities District. “Rate and Method” means the Rate and Method of Apportionment for City of Fontana Community Facilities District No. 113 (The Gardens Phase Two) approved by the qualified electors of the Community Facilities District.
“Rating Downgrade” means, with respect to the Developer Letter of Credit or a Transferred Parcel Letter of Credit, that the rating of the long-term unsecured obligations of the issuer thereof has been reduced to less than “A3” by Moody’s or to less than “A-” by S&P. “Remaining Parcels” means, as of any date, all parcels of Property, excluding any of such parcels for which final inspection approval has been given by the City or for which a certificate of occupancy has been issued by the City on or prior to such date. “Required Letter of Credit Amount” means, with respect to any parcel or parcels within the Community Facilities District, for each Bond Year, an amount equal to 200% of the Share of MADS that would be applicable to such parcel or parcels for the Fiscal Year ending in such Bond Year; provided, however, that the initial Required Letter of Credit Amount shall be based on an estimate mutually agreeable to the Community Facilities District and the Developer. “Richmond American” means Richmond American Homes of Maryland, Inc., a corporation organized and existing under the laws of the State of Maryland, and its successors and assigns.
“Secured Transferred Parcel” means a Transferred Parcel for which a Transferred Parcel Letter of Credit has been delivered to and accepted by the Trustee pursuant to the Indenture and Section 2.2(a) hereof.
“Share of MADS” means, with respect to any property within the Community Facilities District, the share of Maximum Annual Debt Service allocable to such property, which share shall be equal to Maximum Annual Debt Service multiplied by a fraction, the numerator of which is the amount of the Special Tax to be levied on such property in the then current Fiscal Year pursuant to the Rate and Method (assuming that no capitalized interest is available to pay any portion of debt service on the Bonds), and the denominator of which is the total amount of the Special Tax to be levied on all property within the Community Facilities District in the then current Fiscal Year pursuant to the Rate and Method (assuming that no capitalized interest is available to pay any portion of debt service on the Bonds); provided, however, that, for purposes of determining Share of MADS, any parcel of property that, as of the date of such determination, is Undeveloped Property (as defined in the Rate and Method) for which final inspection approval has been given by the City or for which a certificate of occupancy has been issued by the City shall be deemed to be Developed Property (as defined in the Rate and Method) for purposes of calculating the amount of the Special Tax to be levied on such property in the then current Fiscal Year pursuant to the Rate and Method.
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“Special Tax” means the special tax described and defined in the Rate and Method as the “Facilities Special Tax” approved by the qualified electors of the Community Facilities District. “State” means the State of California.
“Substitute Letter of Credit” means one or more irrevocable letters of credit, each of which (a) with respect to a Substitute Letter of Credit replacing the Developer Letter of Credit, is delivered to and accepted by the Trustee pursuant to the Indenture and Section 2.1(e) hereof, or, with respect to a Substitute Letter of Credit replacing a Transferred Parcel Letter of Credit, is delivered to and accepted by the Trustee pursuant to the Indenture and Section 2.2(e) hereof, (b) is issued by a financial institution authorized to do business in the State of California, the longterm unsecured obligations of which, at the time of delivery of such letter of credit, are rated not less than “Aa2” by Moody’s and not less than “A” by S&P, (c) has the same material terms and provisions as the Developer Letter of Credit or Transferred Parcel Letter of Credit, as applicable, that it is replacing, and (d) is for a term of at least one year. “Transferred Parcel” means, as of any date, a Remaining Parcel that is subject to the Special Tax and is owned by a Person other than any of the Developer or an Affiliate thereof or Richmond American or an Affiliate thereof.
“Transferred Parcel Letter of Credit” means an irrevocable letter of credit that (a) is issued by a financial institution authorized to do business in the State of California, the long-term unsecured obligations of which, at the time of delivery of such letter of credit, are rated not less than “Aa2” by Moody’s and not less than “A” by S&P, (b) has terms and provisions that make it suitable for the purposes of, and facilitate its use in accordance with, the provisions of the Indenture and Section 2.2 hereof, which terms and provisions are reasonably acceptable to the Community Facilities District, (c) is delivered to and accepted by the Trustee pursuant to the Indenture and Section 2.2(a) hereof, and (d) is for a term of at least one year; provided, however, that upon the acceptance by the Trustee of a Substitute Letter of Credit in substitution of such Transferred Parcel Letter of Credit in accordance with the Indenture and Section 2.2(e) hereof, such term shall mean such Substitute Letter of Credit.
“Trustee” means the commercial bank or trust company initially designated as trustee under the Indenture, and any successor thereto permitted under the Indenture. 1897
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ARTICLE II

SECURITY FOR PAYMENT OF SPECIAL TAX
Section 2.1. Developer Letter of Credit. (a) Delivery of the Developer Letter of Credit.

If, at the time of the public posting of the official statement or other offering document for the Bonds, the Share of MADS allocable to Developer Secured Parcels will equal or exceed 9% of the then estimated Maximum Annual Debt Service, the Developer shall, on or before such posting date, deliver to the Trustee a Developer Letter of Credit, accompanied by one or more opinions of counsel reasonably satisfactory to the Trustee and the Community Facilities District addressed to the Trustee and the Community Facilities District to the effect, singly or together, that the Developer Letter of Credit is a legal, valid and binding obligation of the Letter of Credit Provider with respect thereto, enforceable against such Letter of Credit Provider in accordance with its terms, except as limited by applicable reorganization, insolvency, liquidation, readjustment of debt, moratorium or other similar laws affecting the enforcement of rights of creditors generally as such laws may be applied in the event of a reorganization, insolvency, liquidation, readjustment of debt or other similar proceeding of or moratorium applicable to such Letter of Credit Provider and by general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law). The amount available under such Developer Letter of Credit shall be at least equal to the Required Letter of Credit Amount for Developer Secured Parcels for the first full Bond Year commencing after the Closing Date. (b) Compliance with the Indenture. The Community Facilities District shall comply with the provisions of the Indenture applicable to the Developer Letter of Credit and shall use its best efforts to cause the Trustee to comply with such provisions of the Indenture. (c) Rating Downgrade. The Developer shall either (i) require the Letter of Credit Provider that issues the Developer Letter of Credit to covenant in a written agreement to give notice to the Developer, the Community Facilities District and the Trustee of a Rating Downgrade with respect to such Letter of Credit Provider, or (ii) provide for an alternative method of providing notice to the Developer, the Community Facilities District and the Trustee of a Rating Downgrade with respect to such Letter of Credit Provider acceptable to the Community Facilities District. The Developer shall provide notice to the Community Facilities District and the Trustee of a Rating Downgrade with respect to the Letter of Credit Provider that issued the Developer Letter of Credit immediately upon receiving notice thereof.
(d) Recalculation of Amount of Developer Letter of Credit. The Developer shall, no later than August 1 of each year (commencing on the August 1 immediately following the Closing Date), deliver to the Community Facilities District a written certification of the Developer as to which parcels within the Community Facilities District constitute Developer Secured Parcels as of such August 1, together with written evidence thereof, which written evidence shall be certified in writing by the Developer and shall include (i) either (A) an owner title guarantee for each such Developer Secured Parcel, or (B) such other form of written evidence demonstrating that such parcel is a Developer Secured Parcel as is reasonably satisfactory to the Community Facilities District, (ii) for each parcel of the Property that, as of such August 1, is a Transferred Parcel that is not a Secured Transferred Parcel (A) the legal description of such parcel and the date such parcel was transferred to Person other than any of the Developer or an Affiliate thereof or Richmond 1898
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American or an Affiliate thereof, (B) a copy of the grant deed pursuant to which such parcel was transferred to Person other than any of the Developer or an Affiliate thereof or Richmond American or an Affiliate thereof, or (C) such other form of written evidence demonstrating that such parcel is a Transferred Parcel that is not a Secured Transferred Parcel as is reasonably satisfactory to the Community Facilities District, and (iii) if applicable, copies or adequate descriptions of relevant final inspection approvals received or certificates of occupancy issued during the twelve months immediately preceding such August 1 for any parcels that, as of such August 1 are owned by any of the Developer or an Affiliate thereof or Richmond American or an Affiliate thereof; provided, however, that the Developer shall have no obligation to deliver such certification and such certified written evidence after the first time that such certification and certified written evidence demonstrates that the Share of MADS allocable to the Developer Secured Parcels is less than 9% of Maximum Annual Debt Service.

The Community Facilities District shall, no later than August 15 of each year, deliver to the Developer a draft Written Certificate of the Community Facilities District specifying the Required Letter of Credit Amount for Developer Secured Parcels for the Bond Year commencing on the immediately succeeding September 2; provided, however, that the Community Facilities District’s obligation to deliver such Written Certificate shall be subject to the Community Facilities District’s receiving from the Developer, no later than August 1 of such year, the certification and written evidence required to be provided by the Developer to the Community Facilities District pursuant to the preceding paragraph. The Required Letter of Credit Amount shall be calculated based on the parcels that constitute Developer Secured Parcels as of such August 1. Within five days of receipt of a copy of such draft Written Certificate, the Developer may provide evidence to the Community Facilities District that such calculation of the Required Letter of Credit Amount is incorrect. If, in its reasonable determination, the Community Facilities District agrees with the Developer that such calculation is incorrect, the Community Facilities District shall revise such Written Certificate of the Community Facilities District so as to correct the Required Letter of Credit Amount specified therein. No sooner than six days and no later than ten days after delivering to the Developer such draft Written Certificate of the Community Facilities District, the Community Facilities District shall deliver to the Trustee (with a copy to the Developer) the final Written Certificate of the Community Facilities District (revised, if necessary, in accordance with the preceding sentence) specifying the Required Letter of Credit Amount for Developer Secured Parcels for the Bond Year commencing on the immediately succeeding September 2. If the amount available under the Developer Letter of Credit is greater than the Required Letter of Credit Amount as specified in such Written Certificate, the Community Facilities District shall direct the Trustee to, in accordance with the terms of the Indenture and the Developer Letter of Credit, cause the available amount under the Developer Letter of Credit to be reduced, on or after September 2 of the following Bond Year, to an amount equal to the Required Letter of Credit Amount as specified in such Written Certificate. If the Required Letter of Credit Amount as specified in such Written Certificate is less than 9% of Maximum Annual Debt Service, the Community Facilities District shall direct the Trustee to, in accordance with the terms of the Indenture and the Developer Letter of Credit, surrender the Developer Letter of Credit to the Letter of Credit Provider with respect thereto.
(e) Substitute Letter of Credit. If at any time (i) the Developer has provided a Substitute Letter of Credit which satisfies the requirements specified in the definition thereof, (ii) the amount available to be drawn under such Substitute Letter of Credit is at least equal to the Required Letter 1899
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of Credit Amount for Developer Secured Parcels for the Bond Year in which such Substitute Letter of Credit is delivered, and (iii) such Substitute Letter of Credit is accompanied by one or more opinions of counsel reasonably satisfactory to the Trustee and the Community Facilities District addressed to the Trustee and the Community Facilities District to the effect, singly or together, that the Substitute Letter of Credit is a legal, valid and binding obligation of the provider thereof, enforceable against the provider thereof in accordance with its terms, except as limited by applicable reorganization, insolvency, liquidation, readjustment of debt, moratorium or other similar laws affecting the enforcement of rights of creditors generally as such laws may be applied in the event of a reorganization, insolvency, liquidation, readjustment of debt or other similar proceeding of or moratorium applicable to the provider thereof and by general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law), the Community Facilities District shall deliver to the Trustee (with a copy to the Developer) a Written Request of the Community Facilities District directing the Trustee to, upon receipt of such Substitute Letter of Credit, accept such Substitute Letter of Credit in substitution of the Developer Letter of Credit then held by the Trustee and surrender the Developer Letter of Credit being replaced to the Letter of Credit Provider that issued such Developer Letter of Credit. (f) No Reduction, Credit or Cure. The Developer hereby acknowledges and agrees that the amount received pursuant to any draw on the Developer Letter of Credit shall in no way reduce, constitute a credit, or cure any delinquency, in respect of the amount of any Special Tax levied on any Developer Secured Parcel or on any other parcel in the Community Facilities District.

Section 2.2. Transferred Parcel Letter of Credit. (a) Delivery of a Transferred Parcel Letter of Credit. If at any time (i) the owner of a Transferred Parcel makes available a Transferred Parcel Letter of Credit which satisfies the requirements specified in the definition thereof, (ii) the amount available to be drawn under such Transferred Parcel Letter of Credit is at least equal to the Required Letter of Credit Amount for such Transferred Parcel for the Bond Year in which such Transferred Parcel Letter of Credit is delivered, (iii) such Transferred Parcel Letter of Credit is accompanied by one or more opinions of counsel reasonably satisfactory to the Trustee and the Community Facilities District addressed to the Trustee and the Community Facilities District to the effect, singly or together, that the Transferred Parcel Letter of Credit is a legal, valid and binding obligation of the Letter of Credit Provider with respect thereto, enforceable against such Letter of Credit Provider in accordance with its terms, except as limited by applicable reorganization, insolvency, liquidation, readjustment of debt, moratorium or other similar laws affecting the enforcement of rights of creditors generally as such laws may be applied in the event of a reorganization, insolvency, liquidation, readjustment of debt or other similar proceeding of or moratorium applicable to such Letter of Credit Provider and by general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law), and (iv) the owner of such Transferred Parcel requests that the Community Facilities District deliver to the Trustee such Transferred Parcel Letter of Credit and such opinion, the Community Facilities District shall promptly deliver to the Trustee (A) such Transferred Parcel Letter of Credit, (B) such opinion, (C) a Written Request of the Community Facilities District (with a copy to the Developer and such owner) directing the Trustee to accept such Transferred Parcel Letter of Credit, identifying the Transferred Parcel to which such Transferred Parcel Letter of Credit is to apply and specifying the Required Letter of Credit Amount for such Transferred Parcel, and (D) a Written Certificate of the Community Facilities District (with a copy to the Developer) specifying the 1900
9 4159-7295-8030.3
revised Required Letter of Credit Amount for Developer Secured Parcels for the Bond Year in which such Transferred Parcel Letter of Credit is delivered. (b) Compliance with the Indenture. The Community Facilities District shall comply with the provisions of the Indenture applicable to Transferred Parcel Letters of Credit and shall use its best efforts to cause the Trustee to comply with such provisions of the Indenture. (c) Rating Downgrade. The Developer shall, or shall cause the owner of each Secured Transferred Parcel to, require the Letter of Credit Provider that issued the Transferred Parcel Letter of Credit for such Secured Transferred Parcel to covenant in a written agreement to give notice to the Developer, the owner of such Secured Transferred Parcel, the Community Facilities District and the Trustee of a Rating Downgrade with respect to such Letter of Credit Provider. The Developer shall provide notice to the Community Facilities District and the Trustee of a Rating Downgrade with respect to each Letter of Credit Provider that issued a Transferred Parcel Letter of Credit immediately upon receiving notice thereof.
(d) Recalculation of Amount of a Transferred Parcel Letter of Credit. The Developer shall cause each owner of a Secured Transferred Parcel to deliver to the Community Facilities District, no later than August 1 of each year (commencing with the August 1 immediately following the delivery of the Transferred Parcel Letter of Credit for such Secured Transferred Parcel), a written certification of such owner as to which parcels within the Community Facilities District constitute Secured Transferred Parcels owned by such owner or Affiliates of such owner as of such August 1, together with written evidence thereof, which written evidence shall be certified in writing by such owner and shall include (i) either (A) an owner title guarantee for each such Secured Transferred Parcel owned by such owner or an Affiliate of such owner, or (B) such other form of written evidence demonstrating that such parcel is a Secured Transferred Parcel owned by such owner or an Affiliate of such owner as is reasonably satisfactory to the Community Facilities District, and (ii) if applicable, copies or adequate descriptions of relevant final inspection approvals received or certificates of occupancy issued during the twelve months immediately preceding such August 1 for any parcels that, as of such August 1 are owned by such owner or an Affiliate thereof.

The Community Facilities District shall, no later than August 15 of each year, deliver to each owner of a Secured Transferred Parcel a draft Written Certificate of the Community Facilities District specifying the Required Letter of Credit Amount for such Secured Transferred Parcel for the Bond Year commencing on the immediately succeeding September 2; provided, however, that the Community Facilities District’s obligation to deliver such Written Certificate shall be subject to the Community Facilities District’s receiving, no later than August 1 of such year, the certification and written evidence with respect to such Secured Transferred Parcel required to be provided pursuant to the preceding paragraph. The Required Letter of Credit Amount shall be calculated based on the parcels that constitute Secured Transferred Parcels owned by such owner or Affiliates of such owner as of such August 1. Within five days of receipt of such draft Written Certificate, the owner of such Secured Transferred Parcel may provide evidence to the Community Facilities District that the calculation of the Required Letter of Credit Amount for Secured Transferred Parcels owned by such owner or Affiliates of such owner is incorrect. If, in its reasonable determination, the Community Facilities District agrees with such owner or the Developer that such calculation is incorrect, the Community Facilities District shall revise such 1901
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Written Certificate of the Community Facilities District so as to correct the Required Letter of Credit Amount specified therein. No sooner than six days and no later than ten days after delivering to such owner such draft Written Certificate of the Community Facilities District, the Community Facilities District shall deliver to the Trustee (with a copy to such owner) the final Written Certificate of the Community Facilities District (revised, if necessary, in accordance with the preceding sentence) specifying the Required Letter of Credit Amount for such Secured Transferred Parcels for the Bond Year commencing on the immediately succeeding September 2. If the amount available under the Transferred Parcel Letter of Credit for such Secured Transferred Parcels is greater than the Required Letter of Credit Amount as specified in such Written Certificate, the Community Facilities District shall direct the Trustee to, in accordance with the terms of the Indenture and such Transferred Parcel Letter of Credit, cause the available amount under such Transferred Parcel Letter of Credit to be reduced, on or after September 2 of the following Bond Year, to an amount equal to the Required Letter of Credit Amount for such Secured Transferred Parcels as specified in such Written Certificate. If the Required Letter of Credit Amount as specified in such Written Certificate is less than 9% of Maximum Annual Debt Service, the Community Facilities District shall direct the Trustee to, in accordance with the terms of the Indenture and such Transferred Parcel Letter of Credit, surrender such Transferred Parcel Letter of Credit to the Letter of Credit Provider with respect thereto. (e) Substitute Letter of Credit. If at any time (i) the owner of a Secured Transferred Parcel has provided a Substitute Letter of Credit which satisfies the requirements specified in the definition thereof in the Indenture, (ii) the amount available to be drawn under such Substitute Letter of Credit is at least equal to the Required Letter of Credit Amount for the Secured Transferred Parcels secured thereby for the Bond Year in which such Substitute Letter of Credit is delivered, and (iii) such Substitute Letter of Credit is accompanied by one or more opinions of counsel reasonably satisfactory to the Trustee and the Community Facilities District addressed to the Trustee and the Community Facilities District to the effect, singly or together, that the Substitute Letter of Credit is a legal, valid and binding obligation of the provider thereof, enforceable against the provider thereof in accordance with its terms, except as limited by applicable reorganization, insolvency, liquidation, readjustment of debt, moratorium or other similar laws affecting the enforcement of rights of creditors generally as such laws may be applied in the event of a reorganization, insolvency, liquidation, readjustment of debt or other similar proceeding of or moratorium applicable to the provider thereof and by general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law), the Community Facilities District shall deliver to the Trustee (with a copy to such owner) a Written Request of the Community Facilities District directing the Trustee to, upon receipt of such Substitute Letter of Credit, accept such Substitute Letter of Credit in substitution of the Transferred Parcel Letter of Credit then held by the Trustee securing the Secured Transferred Parcels owned by such owner and Affiliates of such owner and surrender such Transferred Parcel Letter of Credit being replaced to the Letter of Credit Provider that issued such Transferred Parcel Letter of Credit. (f) No Reduction, Credit or Cure. The Developer hereby acknowledges and agrees that the amount received pursuant to any draw on a Transferred Parcel Letter of Credit shall in no way reduce, constitute a credit, or cure any delinquency, in respect of the amount of any Special Tax levied on the Secured Transferred Parcel secured thereby or on any other parcel in the Community Facilities District.
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(g) Third Party Beneficiaries. The owners of the Secured Transferred Parcels are third party beneficiaries of this Section.

Section 2.3. No Contest to Foreclosure. The Developer, on behalf of itself and its successors and assigns to any portion of the Property while the same remains categorized as Developer Secured Parcels, agrees and covenants that it will not in any action or proceeding challenge the validity, enforceability or constitutionality of the proceedings by which the Community Facilities District was formed and the Special Tax levied, the lien securing repayment of the Special Tax or the applicability thereof to such Developer Secured Parcels, provided that such Special Tax is levied in accordance with the Rate and Method. 1903
12 4159-7295-8030.3

ARTICLE III

REPRESENTATIONS AND WARRANTIES
Section 3.1. Representations and Warranties of the Developer. The Developer makes the following representations and warranties for the benefit of the Community Facilities District:
(a) Organization. The Developer represents and warrants that the Developer is a corporation organized, validly existing and in good standing under the laws of the State of Maryland, is authorized to conduct business and is in good standing under the laws of the State, and has the power and authority to own its properties and assets and to carry on its business as now being conducted and as now contemplated. (b) Authority. The Developer represents and warrants that the Developer has the power and authority to enter into this Agreement, and has taken all action necessary to cause this Agreement to be executed and delivered, and this Agreement has been duly and validly executed and delivered on behalf of the Developer. (c) Binding Obligation. The Developer represents and warrants that this Agreement is a valid and binding obligation of the Developer and is enforceable against the Developer in accordance with its terms, except as limited by applicable reorganization, insolvency, liquidation, readjustment of debt, moratorium or other similar laws affecting the enforcement of rights of creditors generally as such laws may be applied in the event of a reorganization, insolvency, liquidation, readjustment of debt or other similar proceeding of or moratorium applicable to the provider thereof and by general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).
(d) Environmental Matters Relating to Property. The Developer represents and warrants that neither the Developer, nor any subcontractor, agent or employee thereof, has used, generated, manufactured, procured, stored, released, discharged or disposed of (whether accidentally or intentionally) at any time on or prior to the date hereof any Hazardous Material on, under or in the Property, or any structure, fixtures, equipment, or other objects thereon, or transported (whether accidentally or intentionally) any Hazardous Material to or from the Property, or any structure, fixtures, equipment, or other objects thereon, in violation of any federal, state or local law, ordinance, regulation, rule or decision regulating Hazardous Material.

The Developer represents and warrants that there is not present on, under or in the Property or any structure, fixtures, equipment, or other objects thereon, or any portion thereof, any Hazardous Materials, except for (i) any types or amounts that do not require remediation or mitigation under federal, state or local laws, ordinances, regulations, rules or decisions, (ii) those that have been remediated or mitigated in full compliance with applicable federal, state or local laws, ordinances, regulations, rules or decisions, and (iii) those with respect to which ongoing remediation or mitigation is being performed in full compliance with applicable federal, state or local laws, ordinances, regulations, rules or decisions.
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The Developer represents and warrants that the Developer has not received notice of, and, to the best of the Developer’s knowledge, there is not, any proceeding or formal inquiry by any governmental authority, body or agency with respect to the presence of Hazardous Materials on, under or in the Property, or any structure, fixtures, equipment, or other objects thereon, or the migration thereof from or to other property. (e) Certifications. The Developer represents and warrants that each certification delivered by the Developer pursuant to Section 2.1(d) hereof will be true, accurate and complete in all material respects.

The Community Facilities District shall not be required to issue Bonds on any Closing Date unless the Developer makes, on and as of such Closing Date, representations and warranties similar in all material respects to those set forth above.

Section 3.2. Representations and Warranties of the Community Facilities District.

The Community Facilities District makes the following representations and warranties for the benefit of the Developer:
(a) Authority. The Community Facilities District represents and warrants that the Community Facilities District has the power and authority to enter into this Agreement, and has taken all action necessary to cause this Agreement to be executed and delivered, and this Agreement has been duly and validly executed and delivered on behalf of the Community Facilities District.
(b) Binding Obligation. The Community Facilities District represents and warrants that this Agreement is a valid and binding obligation of the Community Facilities District and is enforceable against the Community Facilities District in accordance with its terms.
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ARTICLE IV

MISCELLANEOUS
Section 4.1. Binding on Successors and Assigns. Neither this Agreement nor the duties and obligations of the Developer hereunder may be assigned to any Person without the written consent of the Community Facilities District, which consent shall not be unreasonably withheld or delayed. Neither this Agreement nor the duties and obligations of the Community Facilities District hereunder may be assigned to any Person, without the written consent of the Developer, which consent shall not be unreasonably withheld or delayed. The agreements and covenants included herein shall be binding on and inure to the benefit of any partners, permitted assigns, and successors-in-interest of the parties hereto.

Section 4.2. Amendments. This Agreement may be amended by an instrument in writing executed and delivered by the Community Facilities District and the Developer.

Section 4.3. Waivers. No waiver of, or consent with respect to, any provision of this Agreement by a party hereto shall in any event be effective unless the same shall be in writing and signed by such party, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which it was given.

Section 4.4. Third Party Beneficiaries. The Trustee, the Owners of the Bonds and Richmond American are third party beneficiaries of this Agreement. As provided in Section 2.2(g) hereof, the owners of the Secured Transferred Parcels are third party beneficiaries of Section 2.2 hereof. No other person or entity shall be deemed to be a third party beneficiary hereof, and nothing in this Agreement, either express or implied, is intended to confer upon any person or entity, other than the Community Facilities District, the Developer, the Trustee, the Owners of the Bonds, Richmond American and the owners of the Secured Transferred Parcels, any rights, remedies, obligations or liabilities under or by reason of this Agreement.

Section 4.5. Notices. Any written notice, statement, demand, consent, approval, authorization, offer, designation, request or other communication to be given hereunder shall be given to the party entitled thereto at its address set forth below, or at such other address as such party may provide to the other party in writing from time to time, namely:

Community Facilities District: City of Fontana Community Facilities District No. 113 (The Gardens Phase Two)
c/o City of Fontana
8353 Sierra Avenue
Fontana, California 92335
Attention: Chief Financial Officer, Finance Department
Developer: North Fontana Investment Company, LLC
c/o Lewis Operating Corp.
1156 North Mountain Avenue
Upland, California 91786
Attention: Stacey Sassaman, Vice President
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Each such notice, statement, demand, consent, approval, authorization, offer, designation, request or other communication hereunder shall be deemed delivered to the party to whom it is addressed (a) if given by courier or delivery service or if personally served or delivered, upon delivery, (b) if given by registered or certified mail, return receipt requested, deposited with the United States mail postage prepaid, 72 hours after such notice is deposited with the United States mail, (c) if given by electronic mail, on the date sent, but only if confirmation of the receipt of such electronic mail is received or if notice is concurrently sent by another means specified herein, and (d) if given by any other means, upon delivery at the address specified in this Section.

Section 4.6. Attorneys’ Fees. If any action is instituted to interpret or enforce any of the provisions of this Agreement, the party prevailing in such action shall be entitled to recover from the other party thereto reasonable attorney’s fees and costs of such suit (including both prejudgment and postjudgment fees and costs) as determined by the court as part of the judgment.

Section 4.7. Jurisdiction and Venue. Each of the Community Facilities District and the Developer (a) agrees that any suit, action or other legal proceeding arising out of or relating to this Agreement shall be brought in a state or local court in the County of San Bernardino or in the Courts of the United States of America in the district in which said county is located, (b) consents to the jurisdiction of each such court in any such suit, action or proceeding, and (c) waives any objection that it may have to the laying of venue of any suit, action or proceeding in any of such courts and any claim that any such suit, action or proceeding has been brought in an inconvenient forum. Each of the Community Facilities District and the Developer agrees that a final and nonappealable judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.

Section 4.8. Governing Law. This Agreement and any dispute arising hereunder shall be governed by and interpreted in accordance with the laws of the State.

Section 4.9. Electronic Signature. Each of the parties hereto agrees that the transaction consisting of this Agreement may be conducted by electronic means. Each party agrees, and acknowledges that it is such party’s intent, that if such party signs this Agreement using an electronic signature, it is signing, adopting and accepting this Agreement and that signing this Agreement using an electronic signature is the legal equivalent of having placed its handwritten signature on this Agreement on paper. Each party acknowledges that it is being provided with an electronic or paper copy of this Agreement in a usable format.

Section 4.10. Usage of Words. As used herein, the singular of any word includes the plural, and terms in the masculine gender shall include the feminine.

Section 4.11. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original.

Section 4.12. Effective Date. This Agreement has been dated for convenience purposes only. Notwithstanding the stated date of this Agreement, this Agreement shall be effective on the Effective Date.
1907
1908
City of Fontana
Action Report
City Council Meeting
8353 Sierra Avenue
Fontana, CA 92335
File #: 21-3003 Agenda Date: 5/14/2024
Agenda #: G. Category: Public Hearing
FROM:

Finance
SUBJECT:

Public Hearing, Election, and Resolutions on Formation of Community Facilities District No. 114M (Tract 20512).

RECOMMENDATION:

Immediately after conducting a Public Hearing on the formation of the City of Fontana Community Facilities District No. 114M (the “District” or “Community Facilities District No. 114M”), staff recommends the City Council take the following actions in the following order:

1. Adopt Resolution No. 2024-028, Establishing the City of Fontana Community Facilities District No. 114M (the “Resolution of Formation”).

2. Adopt Resolution No. 2024-029, Calling a Special Election and Submitting to the Voters of Community Facilities District No. 114M a Proposition with Respect to the Annual Levy of Special Taxes within Community Facilities District No. 114M to Pay the Costs of Certain Services to be Provided by Community Facilities District No. 114M and a Proposition with Respect to the Establishment of an Appropriations Limit for Community Facilities District No. 114M (the “Resolution Calling the Election”).

3. Conduct the Special Election.

4. Adopt Resolution No. 2024-030, Declaring the Results of the Special Election for Community Facilities District No. 114M on the Propositions with Respect to (i) the Annual Levy of Special Taxes to Pay the Costs of Certain Services to be provided by Community Facilities District No. 114M and (ii) the establishment of an appropriations limit (the “Resolution Declaring Election Results”).

5. Conduct First Reading (Read title only, and waive further reading) of Ordinance No. 1953, Authorizing the Levy of a Special Tax within Community Facilities District No. 114M (the “Ordinance”). ..End
COUNCIL GOALS:
· Practice sound fiscal management by fully funding liabilities and reserves. · Practice sound fiscal management by developing long-term funding and debt management plans.

BACKGROUND:

The Mello-Roos Act provides for the establishment of community facilities districts as an alternate City of Fontana Page 1 of 3 Printed on 5/8/2024
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File #: 21-3003 Agenda Date: 5/14/2024
Agenda #: G. Category: Public Hearing
method of financing certain essential public capital facilities and services, especially in the developing areas of the State of California. Once duly established by the City, a community facilities district is a separate legal entity with defined boundaries, for which the City Council acts on its behalf as its legislative body. Subject to approval by a two-thirds vote of the qualified electors in compliance with the provisions of the Act, the City Council, as the legislative body of the community facilities district, may levy a special tax to pay for ongoing public services, among other actions.

The landowner, D.R. Horton Los Angeles Holding Company, Inc. (the “Developer”), has submitted a petition to the City to form Community Facilities District No. 114M for the purposes of funding certain public services. The landowner’s property to be included in the District consists of approximately 8.95 taxable acres (85 units) of residential property and is located at the intersection of Summit Avenue and Citrus Road.

The Community Facilities District Report (which is included with the agenda documents) contains a brief description of the services to be funded by the District by type, an estimate of the costs of providing those services, and the incidental expenses to be incurred therewith.

DISCUSSION:

On April 9, 2024, the City Council approved a resolution of intention (the “Resolution of Intention) declaring its intention to establish Community Facilities District No. 114M (the “District”), which also set a public hearing on the establishment of the District for May 14, 2024. The purpose for establishing the District is to provide funding for the maintenance of parks, parkways, street lighting and open space within and surrounding the area of the District and within and surrounding the area of any territory to be annexed to the District in the future and the costs associated with the determination of the amount of a collection of taxes, the payment of taxes and costs otherwise incurred in order to carry out the authorized purposes of the District.

Pursuant to the requirements of the Resolution of Intention and Government Code Section 53322, the City Clerk published a notice of the public hearing in a newspaper of general circulation in the City at least seven (7) days before the date of the public hearing. Additionally, the City Clerk’s designee gave notice of the public hearing by mail to the sole landowner within the District’s boundaries, as prescribed by Section 53322.4 of the California Government Code, at least fifteen (15) days before the public hearing. The boundary map of the District was recorded with the County on April 17, 2024.

At this meeting, the City Council will first open and conduct the public hearing on the formation of Community Facilities District No. 114M. Immediately thereafter, and in order to form the District, the City Council will need to take the following actions in the following order:

1. Adopt the Resolution of Formation which specifies that special taxes will be levied on all parcels of taxable property in the proposed District to finance the public services described therein. The rate and method of apportionment of the proposed special taxes that may be levied for these purposes are set forth as an exhibit to the Resolution of Formation.

2. Adopt the Resolution Calling the Election which schedules the special election for the District with respect to the annual levy of special taxes to pay the costs of the authorized public services, and with respect to establishing an annual appropriations limit for the District.

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File #: 21-3003 Agenda Date: 5/14/2024
Agenda #: G. Category: Public Hearing

3. Conduct the Special Election. The City Clerk has acted as the election official for the special election. The City Clerk and the landowner have consented to the holding of the special election on May 14, 2024. The County Registrar of Voters has certified that there are no registered voters within the boundaries of the District, and thus, the vote is by the landowner. The City Clerk will announce the results of the canvass of ballots and the special election.

4. Adopt the Resolution Declaring Election Results which declares the results of the special election.

5. Conduct a first reading of the Ordinance. If the results of the special election are in favor of the levy of special taxes within the District, the City Council may call the first reading of the Ordinance, authorizing the levy of special taxes within the District.

FISCAL IMPACT:

This action will establish the District, which will levy each property within its boundaries using special tax formulas outlined in the Rate and Method of Apportionment of Special Tax. The District’s Fiscal Year 2024-25 maximum special tax has been established at $907 per taxable assessor’s parcel and allows for a 2% increase per year. All costs for establishing the District have been paid by the Developer with ongoing yearly maintenance services costs paid by the property owner.

The special taxes for the District and any other assessments or special taxes, together with the projected ad valorem property taxes, are not expected to exceed the City Council policy of 1.95% of the sales price.

MOTION:

After conducting the public hearing, Approve the Resolution of Formation, Resolution Calling Election, Resolution Declaring Results of Election, and give first reading to Ordinance upon staff recommendation.

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1 RESOLUTION NO. _____

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

FONTANA ESTABLISHING COMMUNITY FACILITIES
DISTRICT NO. 114M OF THE CITY OF FONTANA,

COUNTY OF SAN BERNARDINO, STATE OF

CALIFORNIA, AND THE BOUNDARIES THEREOF
WHEREAS, on April 9, 2024, the City Council (the “City Council”) of the City of Fontana (the “City”) adopted Resolution No. 2024-014 (the “Resolution of Intention”), declaring its intention to establish a community facilities district to be known as “City of Fontana Community Facilities District No. 114M, County of San Bernardino, State of California” (“CFD No. 114M”) under the provisions of Chapter 2.5 (commencing with Section 53311) of Part 1 of Division 2 of Title 5 of the California Government Code, commonly known as the “Mello-Roos Community Facilities Act of 1982” (the “Act”) for the purpose of providing certain public services, and fixing the time and place for a public hearing (the “Public Hearing”) on the formation of CFD No. 114M and the levy of special taxes therein; and
WHEREAS, as part of the Resolution of Intention, the City Council approved a boundary map of CFD No. 114M (the “Boundary Map”), as required by California Streets and Highways Code Section 3110, entitled “Proposed Boundaries of City of Fontana Community Facilities District No. 114M, San Bernardino, State of California,” which is attached hereto as Exhibit A and incorporated herein; and
WHEREAS, notice of the Public Hearing was published and mailed to the owners of all of the property in the proposed boundaries of CFD No. 114M; and WHEREAS, prior to the commencement of the Public Hearing there was filed with the City Council a report (the “Report”) containing a description of the services being financed within and for CFD No. 114M and an estimate of costs of providing such services, as required by Section 53321.5 of the Act, and such Report has been reviewed by the City Council; and WHEREAS, on May 14, 2024, at the time and place set by the Resolution of Intention, the City Council conducted the Public Hearing and considered the establishment and extent of CFD No. 114M, the levy of the special tax and the proposed rate, method, and apportionment and manner of collection of the special tax, the provision of services by CFD No. 114M, the establishment of an appropriations limit, and all other matters set forth in the Resolution of Intention; and
WHEREAS, at the Public Hearing all interested persons, including all taxpayers, property owners, and registered voters within the proposed boundaries of CFD No. 114M, were given an opportunity to appear and to be heard, and the testimony and protests of all interested persons and all taxpayers, property owners, and registered voters for or against the formation of CFD No. 114M, the levy of the special taxes therein, the provision of the services to be authorized therein, and any other matters set forth in the Resolution of Intention were heard and considered, and a full and fair hearing was held; and
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2 WHEREAS, at the Public Hearing evidence was presented to the City Council on the matters before it, and the City Council, at the conclusion of the hearing, was fully advised as to all matters set forth in the Resolution of Intention; and
WHEREAS, the City Clerk has advised the City Council that a statement from the Registrar of Voters of the County of San Bernardino was received which stated that there are no persons registered to vote in the territory of CFD No. 114M; and WHEREAS, the City Council now desires to proceed to establish CFD No. 114M.

NOW THEREFORE, BE IT RESOLVED by the City Council of the City of Fontana, as follows:

Section 1. Findings. The City Council hereby finds and determines as follows:
(a) All of the preceding recitals are true and correct; (b) At its meeting on May 14, 2024, pursuant to notice thereof duly given as provided by law, the City Council conducted the Public Hearing with respect to the formation of CFD No. 114M and the annual levying of specified special taxes on the taxable property within CFD No. 114M to pay the costs of services for CFD No. 114M, which are described in Exhibit “B” attached hereto;
(c) All prior proceedings with respect to the formation of CFD No. 114M prior to and during the Public Hearing which were conducted by the City Council were valid and in conformity with the requirements of the Act, and except to the extent inconsistent with this resolution, the Resolution of Intention is reaffirmed, and its provisions and findings are, to that same extent, incorporated herein by this reference;
(d) The Boundary Map was recorded on April 17, 2024, pursuant to Section 3110 et seq. of the California Streets and Highways Code, at page 57 of Book 91 of Maps of Assessment and Community Facilities Districts, and as Document No. 2024-0089467, in the official records of the County of San Bernardino;
(e) At the close of the Public Hearing, written protests, if any, to the establishment or extent of CFD No. 114M or to any other matter contained in the Resolution of Intention, were submitted by less than fifty percent (50%) of the registered voters, or by less than six of the registered voters, if any, residing within the territory proposed to be included in CFD No. 114M.

Similarly, the City Council finds that at the close of the Public Hearing, such written protests, if any, were submitted by the owners of less than one-half of the area of land in the territory proposed to be included in CFD No. 114M and not exempt from the special tax. Thus, the City Council finds that it is not precluded by the Act from proceeding further in this matter. The City Council further orders and determines that all protests, if any, that may have been submitted have been considered and are hereby overruled; and
(f) No persons have been registered to vote within the territory of CFD No. 114M for each of the ninety (90) days preceding the close of the Public Hearing, and pursuant to Section 53326 of the Act, the vote in the Special Election (as defined below) provided for herein shall, 1913
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3 therefore, be by the landowners within CFD No. 114M, and each landowner shall have one vote for each acre, or portion thereof, which he or she owns within CFD No. 114M which is not exempt from the special tax.

Section 2. Formation of District. The City of Fontana Community Facilities District No. 114M, County of San Bernardino, State of California, is hereby established. The boundaries of CFD No. 114M are described and shown on the Boundary Map which is on file with the City Clerk and attached hereto as Exhibit A and incorporated herein, and said boundaries are hereby approved and established.

Section 3. Types of Services; Incidental Expenses. The services authorized to be financed by and through CFD No. 114M shall be those services shown on Exhibit B hereto (the “Services”). The City Council finds that the Services do not in any way exceed the description of the authorized services proposed in the Resolution of Intention. All of the Services are necessary to meet increased demands placed on the City as a result of development occurring and anticipated to occur within CFD No. 114M.

CFD No. 114M shall also finance all costs associated with the establishment of CFD No. 114M, administration thereof, the determination of the amount of any special taxes to be levied, the costs of collecting any special taxes, and costs otherwise incurred in order to carry out the authorized purpose of CFD No. 114M.

Section 4. Special Taxes and Appropriations Limit. Except where funds are otherwise available, a special tax sufficient to pay for the Services and related incidental expenses provided in Section 3 above and the annual administrative expenses of the City and CFD No. 114M and in determining, apportioning, levying and collecting such special taxes shall be annually levied within CFD No. 114M. The rate and method of apportionment of said special taxes shall be as set forth in Exhibit “C” attached hereto and by this reference made a part hereof, which sets forth in sufficient detail the rate and method of apportionment of the special taxes to allow each landowner or resident within CFD No. 114M to clearly estimate the maximum amount that such person will have to pay.

Pursuant to Section 53340 of the Act, the special taxes shall be collected in the same manner and at the same time as ordinary ad valorem property taxes; provided, however, that CFD No. 114M may collect special taxes at a different time or in a different manner if necessary to meet its financial obligations, and may covenant to foreclose and may actually foreclose on delinquent assessor’s parcels as permitted by the Act.

Upon recordation of a notice of special tax lien pursuant to Section 3114.5 of the California Streets and Highways Code, a continuing lien to secure each levy of the special taxes shall attach to all non-exempt real property in CFD No. 114M, and that lien shall continue in force and effect until the collection of the special tax ceases. The Finance Department of the City of Fontana, 8353 Sierra Avenue, Fontana, California, is designated as the office responsible for annually preparing a current roll of special tax levy obligations by assessor’s parcel numbers and for estimating future special tax levies pursuant to Section 53340.2 of the Act. 1914
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4 Pursuant to Section 53325.7 of the Act, and subject to voter approval, the initial appropriations limit, as defined by subdivision (h) of Section 8 of Article XIIIB of the California Constitution, for CFD No. 114M is established in the amount of $5,000,000.

Section 5. Exempt Properties. Pursuant to Section 53340 of the Act, and except as provided in Section 53317.3 of the Act, properties of entities of the state, federal, and local governments shall be exempt from the levy of special taxes.

Section 6. Report. The Report is hereby approved and is made a part of the record of the Public Hearing regarding the formation of CFD No. 114M and is ordered to be kept on file with the City Clerk as part of the transcript of these proceedings.

Section 7. Description of Voting Procedures. The voting procedures to be followed in conducting the special election (the “Special Election”) as to (i) the proposition with respect to the levy of special taxes on taxable property within CFD No. 114M to pay the costs of the services to be provided by CFD No. 114M, and (ii) the proposition with respect to establishing an appropriations limit for CFD No. 114M in the amount of $5,000,000, shall be as follows:
(a) Except as otherwise provide below, the Special Election shall be conducted by the City Clerk pursuant to the California Elections Code governing mail ballot elections of cities, and in particular, the provisions of Division 4 (commencing with Section 4000) of said Code, insofar as they may be applicable.
(b) The Special Election shall be held on the earliest date, which may be selected by the City Council, following the adoption by the City Council of this resolution and a resolution pursuant to Section 53326 of the Act submitting to the qualified electors the propositions with respect to the levy of special taxes to pay the costs of the services to be provided by CFD No. 114M and establishing an appropriations limit therefor, or such earlier date as the owners of land within CFD No. 114M and the City Clerk agree and concur is acceptable. (c) Pursuant to Section 53326 of the Act, the time limits for conducting the Special Election may be waived by the qualified electors by unanimous consent and the City Clerk concurs in such earlier election date as shall be consented to by the qualified electors. (d) Pursuant to said Section 53326 of the Act, ballots for the Special Election shall be distributed to the qualified electors by the City Clerk by mail with return postage prepaid, or by personal service.
(e) Pursuant to applicable sections of the California Elections Code governing the conduct of mail ballot elections of cities, and specifically Division 4 (commencing with Section 4000) of the California Elections Code with respect to elections conducted by mail, the City Clerk shall mail or deliver to each qualified elector an official ballot in a form specified by the City Council in the resolution calling and consolidating the Special Election, and shall also mail or deliver to all such qualified electors a ballot pamphlet and instructions to voter, and unless waived as provided for in the Act, shall include a sample ballot identical in form to the official ballot but identified as a sample ballot, a statement pursuant to Section 9401 of that Code, an impartial analysis by the City Attorney pursuant to Section 9280 of that Code with respect to the ballot 1915
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5 propositions contained in the official ballot, arguments and rebuttals, if any, pursuant to Sections 9281 to 9287, inclusive, and 9295 of that Code, a return identification envelope with prepaid postage thereon addressed to the City Clerk for the return of voted official ballots, and a copy of the Resolution of Intention, provided, however, that such conduct, statements, analysis and arguments may be waived pursuant to the Act with the unanimous consent of all the landowners who are qualified electors and shall be so stated in the resolution adopted by the City Council calling the Special Election. Such statements, impartial analysis and arguments, if any, shall be prepared by the City Attorney.
(f) The official ballot to be mailed or delivered by the City Clerk to each landownervoter shall have printed or typed thereon the name of the landowner-voter and the number of votes to be voted by the landowner-voter and shall have appended to it a certification to be signed by the person voting the official ballot which shall certify that the person signing the certification is the person who voted the official ballot, and if the landowner-voter is other than a natural person, that he or she is an officer of or other person affiliated with the landowner-voter entitled to vote such official ballot, that he or she has been authorized to vote such official ballot on behalf of the landowner-voter, that in voting such official ballot it was his or her intent, as well as the intent of the landowner-voter, to vote all votes to which the landowner-voter is entitled based on its land ownership on the propositions set forth in the official ballot as marked thereon in the voting square opposite each such proposition, and further certifying as to the acreage of the landowner-voter’s land ownership within CFD No. 114M.
(g) The return identification envelope mailed or delivered by the City Clerk to each landowner-voter shall have printed or typed thereon the following: (i) the name of the landowner, (ii) the address of the landowner, (iii) a declaration under penalty of perjury stating that the voter is the landowner or the authorized representative of the landowner entitled to vote the enclosed ballot and is the person whose name appears on the identification envelope, (iv) the printed name and signature of the voter, (v) the address of the voter, (vi) the date of signing and place of execution of said declaration, and (vii) a notice that the envelope contains an official ballot and is to be opened only by the City Clerk as the election official. (h) The instructions to voter form to be mailed or delivered by the City Clerk to the landowner-voters shall inform them that the official ballots shall be returned to the City Clerk properly voted as provided thereon and with the certification appended thereto properly completed and signed in the sealed return identification envelope with the certification thereon completed and signed and all other information to be inserted thereon properly inserted by 2:00 p.m. on the date of the election; provided that if all qualified voters have voted, the election shall be closed with the concurrence of the City Clerk.
(i) Upon receipt of the return identification envelopes which are returned prior to the voting deadline on the date of the election, the City Clerk shall canvass the votes cast in the Special Election, and shall file a statement with the City Council as to the results of such canvass and the election on each proposition set forth in the official ballot.

Fontana City CouncilMay 14, 2024

Fontana City Council
May 14, 2024