Lake Forest City Council
March 3, 2026

RESOLUTION NO. 2026- ______

A JOINT RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LAKE

FOREST, CALIFORNIA, AND THE HOUSING AUTHORITY OF THE CITY

OF LAKE FOREST, CALIFORNIA, APPROVING AN AMENDMENT TO

THE AMENDED AND RESTATED AFFORDABLE HOUSING LOAN

AGREEMENT BETWEEN THE CITY OF LAKE FOREST, LAKE FOREST

HOUSING AUTHORITY, AND NATIONAL COMMUNITY RENAISSANCE
WHEREAS, on September 14, 2023, the City of Lake Forest (“City”) issued a Notice of Funding Availability (“NOFA”) to develop additional housing affordable to lower- income households within the community. The NOFA was issued to enable the selection of a qualified development partner. In March 2024, City approved an Exclusive Negotiation Agreement (“ENA”) with National Community Renaissance (“Developer”) to develop housing affordable to lower-income households; and WHEREAS, Developer identified that certain real property located at 22471 Aspan St., Lake Forest, CA 92630 (APN 617-491-03 and APN 617-491-04 and hereafter, the “Property”), for the construction of a 50-unit residential long-term affordable housing rental community that will also include a dedicated room with its own entrance and restroom for Lake Forest Police Services to use for report writing and as a breakroom (“Project”); and WHEREAS, on March 18, 2025, the City Council and the Lake Forest Housing Authority (“Authority”) approved an Affordable Housing Loan Agreement (“AHLA”) with Developer for the development of the Project on the Property. The AHLA established the legal terms and conditions governing a $4.35 million construction loan (“City Loan”), comprised of funds from City’s Affordable Housing In-Lieu Fees and Authority’s Low and Moderate Income Housing Fund, to assist with Project development costs; and WHEREAS, on November 4, 2025, the City Council and Authority approved an Amended and Restated Affordable Housing Loan Agreement (“A/R AHLA”), which modified the City Loan’s structure from a construction loan to an acquisition loan. The City Loan was so modified to allow Developer to acquire the Property and close escrow by the end of January 2026; and
WHEREAS, Developer was unable to close escrow on the Property by the end of January 2026 due to subsequent delays and uncertainties with acquiring other Project- related financing. Against this backdrop, Developer has requested, and City and Authority have agreed, to amend the A/R AHLA to modify the transaction structure and address the Project’s financing gap, enable Developer to close escrow on the Property, and preserve the opportunity to develop affordable housing (i.e., the Project) on the Property; and WHEREAS, the Project is in the best interest of City and Authority and the health, safety and welfare of City’s residents, and in accordance with the public purposes and provisions of applicable federal, state and local laws and requirements; and WHEREAS, approval of the attached First Amendment to the A/R AHLA (“First Amendment”) is not a project under the California Environmental Quality Act (“CEQA”) as Item: 7
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it is merely a governmental funding mechanism. If, however, approval of the First Amendment it is a project under CEQA, its approval is exempt from CEQA pursuant to Government Code Section 65651(b)(2); and
WHEREAS, members of the public have been provided the opportunity to comment upon the First Amendment; and
WHEREAS, all legal prerequisites to the adoption of this Resolution have occurred.

NOW THEREFORE, THE LAKE FOREST CITY COUNCIL AND THE LAKE

FOREST HOUSING AUTHORITY DO HEREBY RESOLVE, DETERMINE, FIND AND ORDER AS FOLLOWS:

SECTION 1.Recitals. The above recitals are true and correct and are incorporated herein and made an operative part of this Resolution.

SECTION 2.CEQA. The City Council and the Authority find that adopting the First Amendment is not subject to the California Environmental Quality Act (CEQA) pursuant to sections 15060(c)(3) and 15378(b)(4) of the State CEQA Guidelines, which provides that the definition of a CEQA project does not include the creation of government funding mechanisms or other government fiscal activities, which do not involve any commitment to any specific project which may result in a potentially significant physical impact on the environment. The First Amendment is not a project because it is an agreement to provide financial assistance for a ministerially approved affordable housing development that was not a project subject to CEQA review pursuant to Government Code section 21080(b)(1).

As such, the First Amendment is not a project subject to CEQA and no further environmental review is required. Notwithstanding the foregoing, the City Council and Authority find that if the First Amendment is a project subject to CEQA, the action approving the First Amendment is exempt from CEQA as it is in furtherance of a permanent supportive housing project that is statutorily exempt from CEQA pursuant to California Government Code section 65651(b)(2). City staff is hereby directed to file a Notice of Exemption within 5 days of this action.

SECTION 3.Approval. The City Council and the Authority hereby approve the First Amendment attached hereto as Exhibit “A” and incorporated herein by reference.

The City Council and the Authority authorize the City Manager and the Executive Director, respectively, in consultation with the City Attorney, to take all necessary actions to effectuate the execution of the First Amendment and all related documents and make any minor revisions to said documents that are necessary to effectuate the intent of the parties. In addition to the foregoing, the City Council and the Authority authorize the Mayor and the Board Chair, respectively, to execute the final form of the First Amendment and any other related documents.

SECTION 4. Severability. If any provision of this Resolution is held invalid by a court of competent jurisdiction, the remainder of this Resolution shall not be affected by such invalidity, and the provisions of this Resolution are severable.

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SECTION 5.Effective Date. This Resolution is effective immediately upon adoption.

PASSED, APPROVED AND ADOPTED this 3 rd day of March, 2026, by the following vote, to wit:
__________________________
ROBERT PEQUEÑO

MAYOR/CHAIR
ATTEST:
______________________________

THY MERRITT

CITY CLERK/AUTHORITY SECRETARY
APPROVED AS TO FORM:
________________________
MATTHEW E. RICHARDSON

CITY ATTORNEY
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172

STATE OF CALIFORNIA )

COUNTY OF ORANGE ) SS

CITY OF LAKE FOREST )
I, Thy Merritt, Authority Secretary of the Lake Forest Housing Authority and City Clerk of the City of Lake Forest, do hereby certify that the foregoing Resolution No. 2026- __ was duly passed and adopted by the Lake Forest Housing Authority and the Lake Forest City Council at a regular meeting thereof, held on the 3rd day of March 2026, by the following vote, to wit:

AYES: CITY COUNCIL/BOARD MEMBERS:

NOES: CITY COUNCIL/BOARD MEMBERS:

ABSENT: CITY COUNCIL/BOARD MEMBERS:

ABSTAIN: CITY COUNCIL/BOARD MEMBERS:
_____________________________

THY MERRITT

CITY CLERK/AUTHORITY SECRETARY
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EXHIBIT “A”

FIRST AMENDMENT TO AMENDED AND RESTATED AFFORDABLE HOUSING

LOAN AGREEMENT
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FIRST AMENDMENT

TO AMENDED AND RESTATED

AFFORDABLE HOUSING AND LOAN AGREEMENT
(Aspan Court Affordable Housing Project)

by and between

CITY OF LAKE FOREST,
a California municipal corporation

and

CITY OF LAKE FOREST HOUSING AUTHORITY

and

National Community Renaissance of California,
a California nonprofit public benefit corporation

Dated as of ______________, 2026

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FIRST AMENDMENT TO AMENDED AND RESTATED

AFFORDABLE HOUSING AND LOAN AGREEMENT

THIS IS THE FIRST AMENDMENT ( “First Amendment”) to that certain Amended and Restated Affordable Housing and Loan Agreement which was made and entered into on November 4, 2025 among the City of Lake Forest, a California corporation, the City of Lake Forest Housing Authority (collectively referred to as the “City”) and National Community Renaissance of California, a California nonprofit public benefit corporation (the “Borrower”). The City and the Borrower are herein occasionally referred to individually as “party” and collectively as the “parties.”

RECITALS

A. The parties entered into an Amended and Restated Affordable Housing and Loan Agreement (the “A/R AHLA”) which was effective on November 4, 2025, the date of its approval by City. All capitalized terms used and not otherwise defined herein will have the meanings assigned to them in the A/R AHLA.

B. The Project contemplated by the A/R AHLA is in the best interest of the City and the health, safety and welfare of the residents of the City, and in accordance with the public purposes and provisions of applicable federal, state and local laws and requirements.

C. By approval by City and execution of this First Amendment by the parties, the parties now desire to amend the A/R AHLA in accordance with the terms of this First Amendment, and these Recitals are deemed incorporated into the covenants set forth below.

COVENANTS

Based upon the foregoing Recitals and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, City and Borrower agree as follows:

1. Interim Use of City Loan. Section 2.1 of the A/R AHLA is hereby amended by adding to it the following provision:

“(b) Interim Funding Use. Because Borrower is required to close the Escrow (by which it or a permitted assignee will acquire title to the Property from the third party seller/owner thereof) by a date before which Borrower has secured approval from TCAC of an allocation of tax credits or a commitment from a lender for a Construction Loan or Permanent Loan, as described in Section 2.9.2, Borrower has not secured the financing necessary for the development, construction and operation of the Project in order to satisfy Section 2.8. Borrower has requested, and the City has agreed, to permit the interim operation of the office building ( “Office Building”) located on the Property until Borrower is able to satisfy the financial capability requirements set out in Section 2.8. Because operation of an office building is not an affordable housing residential use, notwithstanding the restrictions of subparagraph (a) above, City has Docusign Envelope ID: 14BB40FF-FD5C-4ED6-839F-8CD7C585A9C9 Item: 7
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Affordable Housing and Loan Agreement
agreed to permit the Property to be used for office professional operation on an interim basis only and only in compliance with the following conditions:

(i) Such interim use must terminate and Borrower must commence construction of the Project on the Property pursuant to a valid demolition, grading or building permit issued by the City no later than March 18, 2028. Should Borrower fail to do so, Borrower will be deemed to be in breach of the requirements of Section 3.8 and the City shall have all of its remedies under Section 3.8 and under other applicable provisions of the A/R AHLA.

(ii) Because operation of the Office Building on the Property is an interim use only until the affordable housing Project can move forward on the Property, Borrower agrees that (1) without the City’s prior written agreement, which the City will be under no obligation to provide, Interim Owner (as defined in Section 7.3) may not use any portion of the Property or the Office Building improvements thereon for any commercial or residential use or any other use which is not a permitted office, administrative, business or professional use as provided in Title 9 of the City’s Code of Ordinances, (2) Interim Owner may continue to rent or lease (on a short-term or month-to-month basis only) space within the Office Building to tenants presently leasing space within the Office Building or to persons or entities to whom Borrower has outstanding but unsigned leases, rental agreements, letters of intent or proposals as of the date of Borrower’s execution of this First Amendment, (3) on the same short- term or month-to-month basis, Interim Owner may rent space in the Office Building to fill vacancies occurring as a result of existing tenants vacating the Office Building.

Borrower agrees that operation of the Office Building by the Interim Owner is an interim use only in order to provide funds to pay taxes, insurance, utilities, and interior and exterior maintenance expenses of the Office Building so that the Office Building does not deteriorate during the period of its interim operation, (4) Borrower confirms that, as provided in the City’s Deed of Trust, Borrower or Interim Owner as the owner of the Property may not sell, transfer or convey the Property to any third person or entity without the City’s prior written approval for any use other than affordable housing, and (5) Borrower agrees that concurrently with funding the City Loan and recordation of the City Deed of Trust and the City Regulatory Agreement, Interim Owner will execute, acknowledge and cause to be recorded in a lien position immediately following recordation of the City Deed of Trust a covenant in the form of Attachment No. 1 to this First Amendment (“Covenant”) confirming the use of the Property for office purposes to be interim only, that such use may not be expanded or modified, and that the Property cannot be sold for any use other than affordable housing.”

2. City Loan Funding Conditions. Section 2.4 of the A/R AHLA is hereby modified and amended as follows:

(a) Section 2.4(a) is deemed modified so that reference to the documents referred to in Section 2.7 is deemed to also include the Covenant.

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(b) Section 2.4(b) is hereby deemed modified as follows: (i) the City Title Policy will show fee title to the Site vested in the “Interim Owner,” as provided more specifically in Section (8) of the First Amendment, (ii) the City Title Policy will show the lien of the City Deed of Trust in first priority, junior only to the lien of the City’s Regulatory Agreement, (iii) the City Title Policy will show the lien of a deed of trust in favor of National Community Renaissance of California, as the beneficiary thereof, securing a loan to the Interim Owner for an amount not in excess of $1,200,000.00 (the “CORE Deed of Trust”) to assist the Interim Owner to pay the acquisition cost of the Property, (iv) the CORE Deed of Trust will be junior in priority to the City Deed of Trust, the City’s Regulatory Agreement and the Covenant, (v) the City Title Policy will show the lien of the Covenant to be junior to the lien of the City’s Regulatory Agreement and the City Deed of Trust, but to be senior to the CORE Deed of Trust.

(c) The date contained in Section 2.4 by which the Funding Conditions must be satisfied is modified due to the change in the date by which Escrow No. 30117453 (the “Escrow”) at the Escrow Holder must be closed. The Funding Conditions must be satisfied before March 18, 2026, or, if the closing date in the Escrow is again postponed, the date by which Borrower must satisfy the Funding Conditions shall likewise on written notice to the City of postponement of such closing date be postponed to a date not later than the postponed Escrow closing date.

3. Repayment of City Loan. Section 2.6 of the A/R AHLA and the provisions of Section 2(e) of the City Note are hereby deemed modified so that the repayment date of the City Loan will be no later than March 18, 2028 except in the event that the City agrees in writing to extend the date for commencement of construction of the Project beyond March 18, 2028 (which the City is under no obligation to do), in which case the due date of the City Note shall be deemed to be extended to be concurrent with the date of the City’s agreed extension of the date by which construction of the Project must commence. Conforming language changes shall be made to the final version of the City Note to be executed by the Interim Owner and delivered to the City at the close of Escrow.

4. City Deed of Trust. The provisions of Section 2.6 concerning the City Deed of Trust shall be deemed to provide that the City Deed of Trust also secures performance by the Interim Owner under the Covenant and that a default on any of the obligations or restrictions set forth in the Covenant and a subsequent failure to cure any such default within the applicable cure period, if any, will enable the City, at its option, to declare the entire indebtedness evidenced by the City Note immediately due and payable. Conforming language changes shall be made to the final version of the City Deed of Trust to be executed by Interim Owner and delivered to Escrow at the closing for recordation.

5. Execution and Delivery of Documents. Section 2.7 of the A/R AHLA is hereby deleted in its entirety and replaced with the following :

“No later than five (5) days after the date the Funding Conditions in subparagraphs (b)-(h) in Section 2.4 are satisfied, Borrower shall deliver to City the following documents: (a) the City Note, executed by the Interim Owner; (b) the Regulatory Agreement, executed and acknowledged by the Interim Owner; and (c) evidence that the Deed of Trust and Covenant, each executed and acknowledged by the Interim Owner, has been deposited by Borrower or the Interim Owner with the Escrow Holder.

No later than the Funding Conditions Satisfaction Date and prior to City’s disbursement of any City Loan proceeds through Escrow, City shall execute the Docusign Envelope ID: 14BB40FF-FD5C-4ED6-839F-8CD7C585A9C9 Item: 7
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4 First Amendment to Amended and Restated
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Regulatory Agreement and shall cause the Regulatory Agreement to be deposited with Escrow Holder to be recorded together with the Deed of Trust and Covenant at the close of Escrow in the Office Records of Orange County, California. ”

6. Schedule of Performance. The second and third sentences of Section 3.8 of the A/R AHLA are hereby deleted in their entirety and replaced with the following:

“However, Borrower shall cause construction of the Project on the Property to commence pursuant to a valid demolition, grading or building permit issued by the City no later than March 18, 2028. Upon failure to commence construction of the Project on the Property (pursuant to such valid permit issued by the City) by March 18, 2028, the Borrower shall be in default and breach of this Agreement.”

7. Use of Site. The first sentence of Section 4 of the A/R AHLA is hereby deleted in its entirety and replaced with the following:

“During the interim period after the close of the Escrow and before commencement of construction of an affordable housing Project in compliance with Section 3.8 (the “Interim Period”), the Property may be used for office, business, administrative or professional purposes consistent with the restrictions of Section 2.1(b) of the A/R AHLA. Thereafter, upon the end of the Interim Period and transfer of title of the Property by the Interim Owner to the Tax Credit Partnership (as defined in Section 7.3), Borrower and its successors and assigns shall use, operate and maintain the Property as an affordable housing Project in accordance with the provisions of the Regulatory Agreement and of the A/R AHLA, as amended.”

8. Assignment to Interim Owner; Assignment to Tax Credit Partnership. Section 7.3 of the A/R AHLA is hereby deleted in its entirety and replaced with the following:

“7.3 Assignment to Interim Owner; Assignment to Tax Credit Partnership. Because ownership of the Property during the Interim Period when it is operated for office/professional uses is not consistent with the operation of a Tax Credit Partnership or conducive to the future syndication of tax credits in connection with admission of an investor as the limited partner thereof, Borrower has formed NCRC AH Holdings LLC, a California limited liability company of which Borrower is the manager and sole member (the “Interim Owner”) to act as the interim owner of the Property.

Borrower has also formed NCRC Aspan Court LP, a California limited partnership, to act as the “Tax Credit Partnership” in connection with the financing of the Project.

The general partner of NCRC Aspan Court LP is NCRC Aspan Court MGP LLC, a California limited liability company of which Borrower is the manager and sole member. Borrower has requested that the City permit, and the City has agreed to permit, Borrower to transfer and assign to the Interim Owner Borrower’s rights under Borrower’s Real Property Purchase and Sale Agreement dated May 9, 2024 to purchase the Property from Tappan Investments (SC), LLC and also Borrower’s rights under and the deposits in the Escrow. To implement this assignment, Borrower has requested, and the City hereby approves: (i) cancellation and termination of that certain Assignment and Assumption Agreement dated December 15, 2025 from Borrower in favor of the Tax Credit Partnership, which was previously approved by Docusign Envelope ID: 14BB40FF-FD5C-4ED6-839F-8CD7C585A9C9 Item: 7
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5 First Amendment to Amended and Restated
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the City, because the Tax Credit Partnership will no longer acquire title to the Property through the Escrow as was contemplated therein, (ii) Borrower, in its individual capacity and as the general partner of the Interim Owner, will execute the Assignment and Assumption Agreement in the form of Attachment No. 2 hereto (the “Interim Assignment”) to be dated as of the date of City’s approval of this First Amendment, to enable the Interim Owner to acquire title to and operate the Property as an office/professional use during the Interim Period until affordable funding is obtained by Borrower in satisfaction of the provisions of Section 2.8 of the A/R AHLA, and (iii) assuming Borrower’s satisfactory demonstration to, and approval by the designated representatives of the City of, Borrower’s evidence of financial capacity under Section

2.8, when Borrower has received a written reservation letter from TCAC confirming an award of tax credits as a funding source for the affordable housing development of the Property in accordance with the provisions of Section 2.9.2, the City will permit the Interim Owner and Borrower, respectively, to assign their rights to the ownership of the Property (with regard to the Interim Owner) and the rights under the A/R AHLA, as amended, and all other rights, permits, approvals, funding commitments and contracts developed by Borrower for construction of the Project (with regard to the Borrower), to the Tax Credit Partnership, in the form of Attachment No. 3 to this First Amendment (the “Tax Credit Assignment”). Borrower and Interim Owner shall execute the Interim Assignment and submit the same to the City for its execution, conditioned upon City’s approval of the First Amendment to the Amended and Restated Affordable Housing Loan Agreement. Borrower and the Interim Owner must, and upon satisfaction of applicable conditions precedent thereto shall be permitted by the City to, execute and deliver the Tax Credit Assignment to confirm assignment of title of the Property and all of Borrower’s rights under the A/R AHLA to the Tax Credit Partnership at such time as the Funding Conditions have been satisfied, and the identity of the investor and the terms of the amended/restated limited partnership agreement by which the investor becomes a limited partner of the Tax Credit Partnership are both reasonably acceptable to the City. Transfer of title of the Property by the Interim Owner to the Tax Credit Partnership shall be subject to the lien of the Regulatory Agreement and the City’s Deed of Trust. At such time title of the Property transfers to the Tax Credit Partnership, the Tax Credit Partnership will assume the payment obligations of the City Note as a consequence thereof. To facilitate transfer of title of the Property to the Tax Credit Partnership, the City will execute a form of quitclaim or release of the Covenant which the City will permit to be recorded concurrently with recordation of a grant deed from the Interim Owner to the Tax Credit Partnership, and recordation of a construction loan and other affordable housing financing in satisfaction of the provisions of Section 2.9.2 of the A/R AHLA. Upon full execution and delivery of the Tax Credit Assignment, the Tax Credit Partnership will be deemed to be the “Borrower” under the A/R AHLA, as amended. The parties intend, and the Interim Owner agrees by its execution of the Interim Assignment, that the Interim Owner is bound by the provisions of the Covenant during its interim operation of the Office Building on the Property and is obligated to transfer title of the Property to the Tax Credit Partnership when permitted to do so by the City.”

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9. Attachment 2 to the A/R AHLA. The Schedule of Performance attached as Attachment 2 to the A/R AHLA shall be deemed modified as follows: (i) the documents referred to in Row 7 shall also include the Covenant; (ii) the date for the close of Escrow listed in Row 8 shall be March 18, 2026, unless postponed in compliance with the provisions of §

2.4; and (iii) the parenthetical section reference in Row 13 shall be to “(§ 3.8)” and the time for performance shall be no later than March 18, 2028.

10. Counterpart/Captions. This First Amendment may be executed in counterparts, each of which will be deemed an original. This First Amendment is effective and to be dated the date that this First Amendment is approved by the City. Counterparts may be exchanged by electronic transmission. The captions used herein are for convenience only and will not affect the construction to be given to any of the provisions hereof. Unless otherwise specified, all references to Sections herein shall be to Sections of the A/R AHLA.

11. Conflicts With Agreements. In the event that any specific provision contained in this First Amendment conflicts with any provision of the A/R AHLA in any manner, the terms and provisions of this First Amendment will control for all purposes. Borrower and City hereby agree that the A/R AHLA, as modified, amended, supplemented and confirmed by this First Amendment, is a valid and binding agreement in full force and effect and is enforceable in accordance with its terms, as modified herein, and further agree that except as provided in this First Amendment, the provisions of the A/R AHLA will be and remain unmodified.

12. Attachments. Attachment Nos. 1-3 attached to this First Amendment are incorporated herein by this reference and made a part hereof. Said Attachments are identified as follows:

ATTACHMENT NO. 1 COVENANT
ATTACHMENT NO. 2 ASSIGNMENT AND ASSUMPTION AGREEMENT
[INTERIM]
ATTACHMENT NO. 3 ASSIGNMENT AND ASSUMPTION AGREEMENT
[TAX CREDIT PARTNERSHIP]

[All signatures of parties are on the following page]

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IN WITNESS WHEREOF, City and Borrower have executed this First Amendment as of the date set forth above.

“CITY”

CITY OF LAKE FOREST, a California
municipal corporation

By: ________________________________
Name: ______________________________
Title: _____________________________

ATTEST:

_____________________________________
City Clerk

APPROVED AS TO FORM:

_____________________________________
City Attorney

CITY OF LAKE FOREST

HOUSING AUTHORITY

By: ________________________________
Name: ______________________________
Title: _____________________________

ATTEST:

_____________________________________
Secretary

APPROVED AS TO FORM:

_____________________________________
Housing Authority Attorney

“BORROWER”

NATIONAL COMMUNITY RENAISSANCE
OF CALIFORNIA, a California nonprofit
public benefit corporation

By: __________________________________
Michael M. Ruane, President

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Declaration of Restrictive Covenants

ATTACHMENT NO. 1

COVENANT

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1 Declaration of Restrictive Covenants

RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:

City of Lake Forest
100 Civic Center Drive
Lake Forest, CA 92630
Attn: City Manager

______________________________________________________________________________ SPACE ABOVE FOR RECORDER’S USE ONLY

EXEMPT FROM RECORDING FEE PER
GOVERNMENT CODE §27383

DECLARATION OF RESTRICTIVE COVENANTS

THIS DECLARATION OF RESTRICTIVE COVENANTS (the “Covenant”) dated _____________, 2026 for reference purposes, is by NCRC AC HOLDINGS LLC, a California limited liability company ( “Interim Owner”) and is hereby given to and for the benefit of the CITY OF LAKE FOREST, a California municipal corporation and the CITY OF LAKE FOREST HOUSING AUTHORITY (collectively, “City”).

RECITALS

This Covenant affects the ownership and operation of that certain improved real property commonly known as 22471 Aspan Street, Lake Forest, California, more particularly described in Exhibit A attached hereto and incorporated herein by this reference (the “Property”) and is entered into based on the following facts and understandings:

1. The Property consisting of approximately 1.62 gross acres is as of the date of recordation of this Covenant improved by a building which is divided into suites and rented or leased to tenants for operation of office/professional uses therein (the “Office Building”).

2. The manager and sole owner of Interim Owner is National Community Renaissance of California, a California nonprofit public benefit corporation ( “National CORE”). National CORE as “Borrower,” and the City of Lake Forest, a municipal corporation and the City of Lake Forest Housing Authority entered into an Affordable Housing and Loan Agreement dated as of March 18, 2025. Subsequently, National CORE and City entered into an Amended and Restated Affordable Housing and Loan Agreement dated November 4, 2025 and a First Amendment to the Amended and Restated Affordable Housing and Loan Agreement dated ___________, 2026 (as amended and restated, the “Affordable Housing Agreement”). Among other things, the Affordable Housing Agreement contains provisions for a loan by the City to National CORE of $4,350,000.00 to assist National CORE to acquire the Property (the “City Loan”).

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3. National CORE applied to the City for and received various land use approvals necessary or required for development of the Property with an affordable housing project consisting of 50 apartment units, 49 of which are intended to be rented to persons and families of very low, low and lower income at an affordable rent (the “Affordable Housing Project”).

4. As of the date of recordation hereof, National CORE has not received financing necessary to demolish the Office Building and develop/construct the Affordable Housing Project on the Property. However, the current private entity owner of the Property, which entered into a Real Property Purchase and Sale Agreement dated May 9, 2024 for National CORE’s purchase of the Property, has required that the escrow opened to consummate purchase of the Property be closed. The City and National CORE have agreed that the Property will be developed with the Affordable Housing Project in accordance with applicable conditions of the Affordable Housing Agreement. However, National CORE anticipates that certain of its sources for affordable housing financing, specifically the award to and syndication of Federal low income housing tax credits, will take additional time after the Property must be purchased in order to apply for and receive allocations and commitments.

5. Until the Funding Conditions contained in the Affordable Housing Agreement can be satisfied, title to the Property will need to be held by an entity affiliated with National CORE and arrangements acceptable to the City will need to be made for the interim operation of the Office Building. Interim Owner has been established as the entity to take title to the Property until the Funding Conditions have been satisfied, at which time the Interim Owner will transfer title to NCRC Aspan Court LP, a California limited partnership, which is the “tax credit entity” established by National CORE for the purpose of acquiring, developing, constructing and operating the Affordable Housing Project.

6. The funding sources for the City Loan include in-lieu fees received by the City under City’s Developer Fund Affordable Housing Program and money from the Housing Authority Low and Moderate Income Housing Asset Fund (collectively, the “Affordable Housing Dollars”). Due to the nature of the Affordable Housing Dollars, the City requires assurance that ownership of the Property by the Interim Owner and operation of the Office Building as a non- residential use on the Property will be strictly limited in order to ensure that the Affordable Housing Project is built and effectuates the affordable housing goals of the City.

7. The City Loan will be evidenced by a promissory note secured by a deed of trust in favor of the City (“City Deed of Trust”). Concurrently with recordation of the City Deed of Trust, the City has required recordation of a regulatory agreement ( “Regulatory Agreement”) containing provisions applicable to the development, construction, maintenance and operation of the Property as an Affordable Housing Project. The City Deed of Trust secures not only performance under the promissory note but also under the City Deed of Trust, the Regulatory Agreement and this Covenant.

8. In connection with the negotiation and approval of a First Amendment to the Amended and Restated Affordable Housing and Loan Agreement (the “First Amendment”), (i) the City approved Interim Owner as the owner of the Property until it can be developed with the Affordable Housing Project, and (ii) recordation of this Covenant assuring the City of use of the Docusign Envelope ID: 14BB40FF-FD5C-4ED6-839F-8CD7C585A9C9 Item: 7
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3 Declaration of Restrictive Covenants

Office Building and the Property in the interim which are compatible with the City’s intention to permit the City Affordable Dollars to be used for affordable residential housing and not for non- residential purposes and for the Property to be developed with the Affordable Housing Project and not to be operated for other than an interim period with an Office Building and used for office/professional uses.

9. As consideration for the City’s agreement to the First Amendment and as an inducement to the City for its contribution of the Affordable Housing Dollars towards the Affordable Housing Project (and the interim use thereof as set forth herein), National CORE, for itself and for Interim Owner, have agreed to execute and record this Covenant to restrict the interim use and occupancy of the Office Building as more specifically provided herein.

OPERATIVE PROVISIONS

NOW, THEREFORE, in consideration of the City Loan and for other valuable consideration, the Interim Owner hereby covenants, agrees and declares that the Property will be owned, held, used, maintained and transferred pursuant to the following restrictive covenants, conditions, restrictions and limitations contained herein (collectively, “Restrictions”). Such Restrictions shall be binding upon all of the Interim Owner’s successors, assigns and transferees to or of the Property and upon all leases, tenants, contractors, agents and persons claiming an interest in the Property or claiming an interest by or through any of the foregoing until such time as the agreement between the City and National CORE enables the release of these Restrictions.

1. Operation of Interim Use. Interim Owner for itself and any successor and assign, hereby declares and covenants that use of the Property is restricted to operation of an Office Building rented or leased by tenants who may conduct office/professional uses therein. The Office Building may not be used for commercial, industrial, residential or any other use other than an office, administrative, business or professional use which is permitted under Title 9 of the Code of Ordinances of the City of Lake Forest. Interim Owner further declares and covenants that it will not be entitled to sell, convey or transfer the Property or any interest therein other than for affordable housing and other than as is permitted under the Affordable Housing Agreement. In furtherance thereof, Interim Owner agrees that it will only be entitled to transfer or convey title to the Property (i) to the Tax Credit Partnership upon satisfaction of all the Funding Conditions contained in the Affordable Housing Agreement, (ii) to the City, or (iii) as the City shall instruct in the event of an uncured default under the Affordable Housing Agreement. Interim Owner further covenants and agrees that the office/professional use of the Office Building may not be expanded during the period of interim operation of the Office Building by the Interim Owner. In clarification of the foregoing, Interim Owner shall be entitled to lease/rent office suites on a short term or month-to-month basis to tenants of the Office Building which are tenants as of the date of recordation of this Covenant or entities or persons with whom National CORE was negotiating for lease or rental of space in the Office Building as of the date hereof, and to other parties to lease/rent and occupy such space in the event of vacation of the Office Building by a current tenant, all for the purpose of providing Interim Owner with funds to maintain the Office Building and the Property, pay the utilities thereon, pay property taxes and insurance premiums and perform common area maintenance until such time as title to the Property can be transferred to the Tax Credit Partnership for the development and construction of the Affordable Housing Project.

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4 Declaration of Restrictive Covenants

2. Interim Maintenance and Repair of the Office Building and Property. Interim Owner agrees (i) to keep the Property in safe condition and repair and to permit no waste thereof, (ii) not to commit or suffer to be done or exist on or about the Property or the Office Building any condition causing the Property or the Office Building to be a threat to public health, safety or welfare, (iii) not to construct improvements or additions to the Office Building, or to demolish or structurally alter the Office Building, except with prior City approval which the City is under no obligation to provide, (iv) to comply with all applicable laws affecting the Property and not to alter the interim use of all or any part of the Property or the Office Building which is specified in Section 1 above without the City’s prior written consent, which it is under no obligation to give.

3. Restrictions on Sale and Other Acts. Interim Owner shall not, except with the City’s prior written consent, make any sale, encumbrance, hypothecation, assignment, conveyance or transfer of the Property, the Office Building or of any of its interest in either of them except to transfer the same, if and in compliance with the Affordable Housing Agreement, as amended, to the Tax Credit Partnership, National CORE or the City.

4. Security. Interim Owner’s performance under this Covenant is secured by the City Deed of Trust, which shall be recorded concurrently herewith.

5. Covenants Run with the Land. The Property is held, leased, rented, used and occupied subject to these Restrictions. The foregoing Restrictions are intended to constitute both equitable servitudes and covenants running with the land. Interim Owner expressly acknowledges and agrees that it has agreed that the Restrictions are reasonable restraints on Interim Owner’s right to own, use, maintain and transfer the Property and any estate or interest therein and are not and shall not be construed to be an unreasonable restraint on alienation.

6. Term. The provisions of this Covenant shall be binding, effective and enforceable by the City, at its discretion, until the earlier of the following shall occur: (i) the date on which a City-approved transfer of title to the Property from the Interim Owner to the Tax Credit Partnership has occurred, upon which this Covenant will be released by an instrument signed by the City and recorded by National CORE or the Tax Credit Partnership in order to terminate the interim provisions of this Covenant, (ii) March 18, 2028 (unless such date is extended by prior written agreement of the City), or (iii) National CORE’s default under the Affordable Housing Agreement which remains uncured after any time period provided for the cure or remedy thereof and exercise of any remedy of the City including, but not limited to, foreclosure under its Deed of Trust, deed in lieu of foreclosure to the City or as otherwise provided by agreement or by law.

7. Amendments; Modification. Except in compliance with an executory provision of this Covenant, Interim Owner shall not amend, modify, waive or release this Covenant, or any part hereof, without the prior and express written consent of an authorized representative of the City, which consent may be withheld, conditioned or delayed in the City’s sole and absolute discretion.

Any modification, amendment, waiver or release of this Covenant without the prior and express written consent of the City shall be void.

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5 Declaration of Restrictive Covenants

8. Severability. Every provision of this Covenant is intended to be severable. If any provision hereof is held invalid, illegal or unenforceable by a court of competent jurisdiction, the validity, legality and enforceability in the remaining provisions shall not be affected or impaired thereby.

IN WITNESS WHEREOF, Interim Owner has executed this Covenant which shall be effective on the date of its recordation.

INTERIM OWNER:

NCRC AC Holdings LLC

By its Manager
National Community Renaissance of California

By: __________________________________
(Name) (Title)

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EXHIBIT A
Declaration of Restrictcive Covenants

EXHIBIT A
(Legal Description of the Property)

THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF LAKE

FOREST IN THE COUNTY OF ORANGE, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:

THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF LAKE

FOREST IN THE COUNTY OF ORANGE, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:

PARCEL 3, IN THE COUNTY OF ORANGE, STATE OF CALIFORNIA, AS SHOWN ON A MAP RECORDED IN BOOK 140, PAGES 40 AND 41 OF PARCEL MAPS, RECORDS OF SAID ORANGE COUNTY.

ALSO EXCEPTING THEREFROM ALL MINERAL RIGHTS, INCLUDING WITHOUT

LIMITATION ALL OIL, GAS, HYDROCARBON, AND SIMILAR RIGHTS, AND ALL

WATER, WATER RIGHTS, GEOTHERMAL STEAM, POWER WITHIN OR UNDERLYING

SAID PROPERTY, TOGETHER WITH THE PERPETUAL RIGHT OF DEVELOPMENT THEREOF; PROVIDED, HOWEVER, THAT THE RIGHTS THEREIN RESERVED AND

EXCEPTED DO NOT INCLUDE THE RIGHT TO ENTER UPON THE SURFACE AND THE TOP 500 FEET OF THE SUBSURFACE OF SAID LAND, AS RESERVED IN DEED FROM OCCIDENTAL LAND, INC., A CALIFORNIA CORPORATION, RECORDED OCTOBER 14, 1977, IN BOOK 12414, PAGE 1152, OFFICIAL RECORDS.

APN 617-491-03; APN 617-491-04

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First Amendment to Amended and Restated
Affordable Housing and Loan Agreement

ALL-PURPOSE ACKNOWLEDGMENT Civil Code §1189

State of California )
) ss.

County of San Bernardino )

On , 2026, before me, , Notary Public Date Name and Title of Officer (e.g., “Jane Doe, Notary Public”)

personally appeared
_________________________________________________________ Name(s) of Signer(s)
who proved to me on the basis of satisfactory evidence to be the person whose name(s) are/is subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

WITNESS my hand and official seal.

Signature ________________________________________________

Signature of Notary Public
Place Notary Seal and/or Stamp Above
_________________________OPTIONAL_____________________________ Completing this information can deter alteration of the document or fraudulent reattachment of this form to an unintended document.

Description of Attached Document
Title or Type of Document: Declaration of Restrictive Covenants Document Dated , 2026 Number of Pages: _____ Signer(s) Other Than Named Above:_________________________________ Capacity(ies) Claimed by Signer
Signer’s Name: _____________________________________

☐ Individual
□ Corporate Officer - Title(s):
□ Co-Managing Member
☐ Attorney in Fact
□ Trustee
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

I certify under PENALTY OF PERJURY under
the laws of the State of California that the
foregoing paragraph is true and correct.

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First Amendment to Amended and Restated
Affordable Housing and Loan Agreement
☐ Guardian or Conservator
☐ Other:

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Assignment and Assumption Agreement
[Interim]
ATTACHMENT NO. 2

ASSIGNMENT AND ASSUMPTION [INTERIM]

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1 Assignment and Assumption Agreement
[Interim]

[INTERIM]

ASSIGNMENT AND ASSUMPTION AGREEMENT

THIS ASSIGNMENT AND ASSUMPTION AGREEMENT [INTERIM] (“Agreement”) dated _______________, 2026, is by National Community Renaissance of California, a California nonprofit public benefit corporation (“Assignor” or, sometimes, “National CORE”) in favor of NCRC AC Holdings LLC, a California limited liability company ( “Assignee” or “Interim Owner”). Assignor and Assignee are sometimes referred to herein individually as a “Party” and collectively as the “Parties.”

RECITALS

A. National CORE, as the “Buyer,” and Tappan Investments (SC), LLC, a California limited liability company, as the “Seller,” entered into a Real Property Purchase and Sale Agreement dated May 9, 2024 (as amended, the “Purchase Agreement”) for National CORE’s purchase of improved real property commonly known as 22471 Aspan Street, Lake Forest, California (the “Property”). Pursuant to applicable provisions of the Purchase Agreement, Escrow No. 30117453 (the “Escrow”) was opened at Fidelity National Title Insurance Company (“Escrow Holder”) on May 17, 2024. Pursuant to provisions of the Purchase Agreement, subject to the satisfaction of closing conditions therein, the Escrow will close on [March 18], 2026 (the “Closing Date”).

B. National CORE, as “Borrower”, and the City of Lake Forest, a municipal corporation and the City of Lake Forest Housing Authority (collectively, the “City”) entered into an Affordable Housing and Loan Agreement dated as of March 18, 2025, as subsequently amended by the Amended and Restated Affordable Housing and Loan Agreement dated November 4, 2025 and a First Amendment to the Amended and Restated Affordable Housing and Loan Agreement dated _________, 2026 (as amended and restated, the “Affordable Housing Agreement”).

Among other things, the Affordable Housing Agreement contains provisions for a loan of $4,350,000.00 by the City to National CORE to assist National CORE to acquire the Property (the “City Loan”). The City Loan is to be evidenced by a Promissory Note Secured by Deed of Trust with Assignment of Rents ( “City Note”); the City Note is secured by a Deed of Trust with Assignment of Rents ( “City’s Deed of Trust”), a Regulatory Agreement and Declaration of Covenants and Restrictions (“Regulatory Agreement”) and a Covenant (“Covenant”), all to be recorded against title to the Property at the close of Escrow in the priority established in the Affordable Housing Agreement. The Affordable Housing Agreement, City Note, City’s Deed of Trust, Regulatory Agreement, and Covenant are herein sometimes referred to collectively as the “City Agreements ." National CORE also applied for and expects to receive a necessary determination from the County Counsel’s office of Orange County of a Restrictive Covenant Modification Document under Civil Code Section 714.6 (“Restrictive Covenant Modification”), which may be recorded at the close of Escrow.

C. The City Loan will assist in acquiring the Property in order to have the Property available when necessary financing is available to construct thereon a residential affordable Docusign Envelope ID: 14BB40FF-FD5C-4ED6-839F-8CD7C585A9C9 Item: 7
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2 Assignment and Assumption Agreement
[Interim]

housing apartment rental project (the “Affordable Housing Project”) to be rented at an affordable rent to qualifying persons and families of very low and low income, as specified and defined in the Regulatory Agreement.

D. Assignor is the manager and sole member of Interim Owner. Interim Owner was formed by Assignor for the purpose of acquiring title to the Property, serving as the interim owner thereof, and operating the existing office improvements thereon until sufficient financing is in place to construct, equip, operate and maintain the Affordable Housing Project. When sufficient funding is committed and concurrently with funding thereof, Interim Owner must transfer title of the Property to NCRC Aspan Court LP, a California limited partnership (“Project Partnership”).

The Project Partnership has been established by Assignor; Assignor functions as the manager and sole member of NCRC Aspan Court MGP LLC, a California limited liability company (“General Partner”), which is the general partner of the Project Partnership. Assignor, Interim Owner, the General Partner, and the Project Partnership are all affiliated entities.

E. Under the provisions of Section 7.3 of the Affordable Housing Agreement, transfer by Assignor of its interest as the purchaser of the Property must be reasonably acceptable to the City. Transfer of National CORE’s interest under the Purchase Agreement is also subject to the City’s requirement that upon acquisition of title to the Property at the close of the Escrow by an approved assignee, such title shall be subject to the liens of the Regulatory Agreement, the Covenant and the City’s Deed of Trust.

F. Assignor desires to transfer its interest under the Purchase Agreement to Interim Owner. Interim Owner desires to acquire Assignor’s interest in and to assume Assignor’s obligations under the Purchase Agreement, to hold title to the Property and operate the improvements thereon as the interim owner thereof in compliance with the provisions of the Covenant. As a condition of such transfer and assignment to Interim Owner, when sufficient financing is available, Interim Owner must transfer title of the Property and all personal property thereon to the Project Partnership in order that the Project Partnership may thereafter construct, own and operate the Affordable Housing Project on the Property, as contemplated by the City Agreements.

G. Assignor desires to confirm the assignment to Interim Owner of all of Assignor’s tangible and intangible rights, title and interest in and to the Purchase Agreement, the Escrow and all deposits of money or documents therein (collectively, the “Assigned Matters”). Interim Owner desires to confirm its assumption of all obligations under the Purchase Agreement and the Escrow, as well as its obligation to execute, deliver and comply with applicable provisions of the City Note, City’s Deed of Trust, Regulatory Agreement and the Covenant in satisfaction of applicable provisions of Sections 2.7 and 7.3 of the Affordable Housing Agreement (collectively, the “Assumed Obligations”).

H. This Agreement confirms the actions taken by Assignor to assign the Assigned Matters to Interim Owner as of the date of this Agreement. In its capacity as the “Developer” and as the manager of Interim Owner, Assignor will have a continuing economic interest in the Docusign Envelope ID: 14BB40FF-FD5C-4ED6-839F-8CD7C585A9C9 Item: 7
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3 Assignment and Assumption Agreement
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Affordable Housing Project and will benefit from assignment of the items described herein for use by the Assignee.

I. Interim Owner acknowledges that promptly when it is instructed to do so by Assignor, Interim Owner will (i) transfer title of the Property to the Project Partnership, and (ii) with Assignor, execute an Assignment and Assumption Agreement which, among other things confirms the transfer by Interim Owner of title to the Property and all rights therein to the Project Partnership.

NOW, THEREFORE, Assignor and Interim Owner hereby agree as follows:

1. Assignment.

1.1 Assignment of Assignor. By its execution hereof and by delivery of this Agreement to Interim Owner, Assignor confirms that it hereby transfers, conveys and assigns to Assignee all of Assignor’s right, title and interest in and to all of the Assigned Matters described in Recital G above and, except as provided in Section 1.3, all representations, warranties and guaranties (whether written or oral), potential or existing legal or equitable rights, claims and causes of action and all other similar, and all related, contractual rights connected with or relating to the Assigned Matters.

1.2 Acknowledgement of Assumption. Interim Owner expressly assumes, acknowledges and agrees for the benefit of City to be bound by, to execute, and to perform and comply with, the provisions of each of the instruments constituting the Assumed Obligations described in Recital G above, as well as any and all matters associated with the Assigned Matters and the Assumed Obligations from and after the date of this Agreement. The Parties explicitly agree and confirm that City shall have the same rights and remedies against the Interim Owner from and after the date of this Agreement as City had against Assignor under the terms and provisions of the City Note, the City’s Deed of Trust, the Regulatory Agreement and the Covenant, with the same force and effect as though every such duty, obligation, responsibility, right or remedy were set forth herein in full. In the event of any default or breach under the instruments comprising the Assumed Obligations arising from and after the effective date of this Agreement, City may proceed directly against Interim Owner, any guarantors, or anyone else liable under the City Agreements without first exhausting City’s remedies against any other person or entity liable under the City Agreements to City pursuant to the express terms and conditions of the City Agreements.

1.3 Retained Rights. Assignor retains nonexclusive rights and interest in and to all warranty rights or indemnity rights (including defense and other related rights) and any and all other rights and claims against any person relating to any event with respect to any claim (whether valid or invalid) which is at any time made against Assignor under, and/or related to any of the Assigned Matters; provided, however, that Interim Owner will have the primary/leading role in enforcing any such rights and/or claims but subject to its reasonable cooperation with Assignor.

1.4 Confirmation. Interim Owner agrees that it is acquiring Assignor’s interest in the Assigned Matters upon all of the terms contained in this Agreement including, but not limited Docusign Envelope ID: 14BB40FF-FD5C-4ED6-839F-8CD7C585A9C9 Item: 7
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4 Assignment and Assumption Agreement
[Interim]

to, Interim Owner’s obligation to satisfy the closing conditions set out in the Purchase Agreement and close the Escrow.

2. Acceptance and Assumption. Interim Owner hereby accepts the assignment of the items, rights, and obligations as provided in Section 1 and assumes the responsibility of performing any and all of the obligations and duties of Assignor under and/or related to any of such Assigned Matters and Assumed Obligations as provided in Sections 1.2 and 1.4 above, and to execute all documents and instruments which Assignor was, is or will be obligated to execute under the provisions of any of the Assigned Matters and Assumed Obligations.

3. Further Assurances. Assignor will execute and deliver any and all additional papers, documents and other assurances, and will do any and all acts and things reasonably necessary to accomplish the assignment set forth in Section 1.

4. Successors and Assigns. This Agreement will be binding upon and inure to the benefit of the successors and assigns of Assignor and Interim Owner.

5. Assignee Dissolution. If at any point prior to the full repayment and satisfaction of the City Loan, Interim Owner ceases to exist or enters bankruptcy proceedings, this Agreement shall be immediately null and void, without the need for any further action by any party. In the preceding instances, any and all rights and responsibilities owed to the City pursuant to the City Agreements shall fully revert to the Assignor, and Assignor shall be fully liable to the City under the City Agreements, both as if this Agreement had never been executed or effective. If the preceding occurs any reversion, and subsequent transfer of liability to the Assignor, shall not be limited or modified by the date of the dissolution or bankruptcy of the Assignee; the Assignor shall be liable for the entirety of all debts, obligations, and otherwise included in the City Agreements.

6. Attorneys’ Fees. In any action between Assignor and Interim Owner involving this Agreement or the Assigned Matters, the prevailing party will be entitled to recover from the other party, in addition to damages, injunctive or other relief, if any, all costs and expenses (whether or not allowable as “cost” items by law) reasonably incurred at, before and after trial or on appeal, or in any bankruptcy or arbitration proceeding including, without limitation, attorneys’ fees, witness fees (experts and otherwise), deposition costs, copying charges and other expenses.

7. Interpretation. This Agreement is made and entered into in the State of California and will in all respects be interpreted, enforced and governed under the laws of the State of California. The language in all parts of this Agreement will be in all cases construed as a whole according to their fair meaning and not strictly for or against either Assignor or Interim Owner.

This Agreement has been negotiated and prepared by both Assignor and Interim Owner. Any rule of contract interpretation to the effect that ambiguities or uncertainties are to be interpreted against the drafting party, or the party that caused it to exist, will not be employed in the interpretation of this Agreement.

8. Incorporation. The Recitals set forth in the beginning of this Agreement are incorporated into the operative provisions hereof.

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9. Severability. If any term, provision, condition or covenant of this Agreement or its application to any party or circumstance is held to be, to any extent, invalid or unenforceable, then the remainder of this Agreement, or the application of such term, provision, condition or covenant to any party or circumstances other than those as to whom or which it is held invalid or unenforceable will not be affected and will be valid and enforceable to the full extent permitted by law.

10. Authority. Each person signing this Agreement represents and warrants that he or she has the proper authority to bind the party on whose behalf he or she signs this Agreement.

11. Amendment. This Agreement may not be amended or modified except by a writing signed by Assignor and Interim Owner which expressly states that it amends this Agreement.

12. Indemnification of the Interim Owner by Assignor. Assignor will, to the fullest extent permitted by law, indemnify, defend (with legal counsel reasonably acceptable to Interim Owner), protect and hold harmless Interim Owner and the members, directors, officers, employees, agents, successors and assigns thereof from and against any and all claims, actions, causes of action, rights, defenses, demands, allegations, damages, fines, penalties, liabilities, losses, liens, obligations, judgements, awards, appeals, costs and expenses (including, but not limited to, reasonable fees and costs of attorneys, expert witnesses and other consultants) of any kind or character at law, in equity or otherwise, regarding, arising out of or in connection with, or in any manner related to (i) any of the Assigned Matters prior to the date hereof, and (ii) any breach or default by Assignor under this Agreement.

13. Counterparts. This Agreement may be executed in counterparts, each of which will be deemed an original but all of which will together constitute one and the same instrument.

ASSIGNOR:

National Community Renaissance of California

By: __________________________________
(Name) (Title)

ASSIGNEE

NCRC AC Holdings LLC

By its Manager
National Community Renaissance of California

By: __________________________________
(Name) (Title)

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S-1
Assignment and Assumption Agreement
[Interim]

The City of Lake Forest and the City of Lake Forest Housing Authority (collectively, “City”) execute this instrument solely to acknowledge (i) their approval of the form of this Assignment and Assumption Agreement [Interim], and (ii) their consent to the transfer of National CORE’s right, title and interest in and to the purchase of the Property and to the Escrow as set forth herein to NCRC AC Holdings LLC, a California limited liability company and to execution of the City Note, City’s Deed of Trust, Regulatory Agreement and Covenant by NCRC AC Holdings LLC, as provided herein.

City of Lake Forest,
a California municipal corporation

By: ______________________
______________________,
City Manager

City of Lake Forest Housing Authority,
a California municipal corporation

By: ______________________
Name: ______________________
Its: ______________________

ATTEST:

By: ____________________________
City Clerk

APPROVED AS TO FORM:

Best, Best & Krieger LLP

By: ____________________________
City Attorney

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Assignment and Assumption Agreement
[Tax Credit Partnership]
ATTACHMENT NO. 3

ASSIGNMENT AND ASSUMPTION [TAX CREDIT PARTNERSHIP]

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1 [Tax Credit Partnership]
Assignment and Assumption Agreement
[TAX CREDIT PARTNERSHIP]

ASSIGNMENT AND ASSUMPTION AGREEMENT

THIS ASSIGNMENT AND ASSUMPTION AGREEMENT [TAX CREDIT
PARTNERSHIP] ( “Agreement”) is dated ______________, 202__, and is by National Community Renaissance of California, a California nonprofit public benefit corporation (“National CORE”), and NCRC AC Holdings LLC, a California limited liability company (“Interim Owner”) (National CORE and Interim Owner are collectively referred to herein as “Assignor”) in favor of NCRC Aspan Court LP, a California limited partnership ( “Assignee” or “Project Partnership”). Assignor and Assignee are sometimes referred to herein individually as a “Party” and collectively as the “Parties.”

RECITALS

A. National CORE, as “Borrower”, and the City of Lake Forest, a municipal corporation and the City of Lake Forest Housing Authority (collectively, the “City”) entered into an Affordable Housing and Loan Agreement dated as of March 18, 2025, as subsequently amended in the Amended and Restated Affordable Housing and Loan Agreement dated November 4, 2025 and a First Amendment to the Amended and Restated Affordable Housing and Loan Agreement dated __________, 2026 (as amended and restated, the “Affordable Housing Agreement”).

Among other things, the Affordable Housing Agreement contains provisions for a loan of $4,350,000.00 (the “City Loan”) by the City to assist in the acquisition of a parcel of improved real property commonly known as 22471 Aspan Street, Lake Forest, California (the “Property”); the Property is improved by an office building. Although National CORE and the City contemplated in the Affordable Housing Agreement that National CORE or a permitted assignee would acquire title to the Property, concurrently demolish the improvements thereon, and then develop and construct thereon an affordable housing apartment rental project to be rented at an affordable rent to qualifying persons and families of very low and low income (the “Affordable Housing Project”), National CORE was unable to secure sufficient financing to proceed with the immediate development of the Affordable Housing Project at such time as it was obligated to close escrow to acquire the Property. National CORE proposed to the City, and the City agreed, to permit National CORE to transfer its contract rights to purchase the Property to an interim ownership entity which would take title to the Property and operate it as an office building until such time as sufficient financing was awarded to National CORE or the Affordable Housing Project in order to permit its development as a residential affordable rental community as initially contemplated.

Interim operation of the office building would be carried out in compliance with a Covenant in favor of the City. Such interim ownership entity then would transfer title to the Property to the Project Partnership. The Interim Owner was formed for the purpose of holding title to the Property, executing and complying with applicable provisions of the City Note, the City’s Deed of Trust, the Regulatory Agreement and the Covenant, and operating the improvements thereon until the Affordable Housing Project could go forward.

B. As a condition to making the City Loan, the City required in the Affordable Housing Agreement that the City Loan be evidenced by a Promissory Note Secured by Deed of Trust with Assignment of Rents ( “City Note”), which City Note is to be secured by a Deed of Trust with Docusign Envelope ID: 14BB40FF-FD5C-4ED6-839F-8CD7C585A9C9 Item: 7
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Assignment and Assumption Agreement
Assignment of Rents ( “City’s Deed of Trust”), a Regulatory Agreement and Declaration of Covenants and Restrictions (“Regulatory Agreement”) and a Covenant, all to be recorded against title to the Property at the close of Escrow in the priority established in the Affordable Housing Agreement. The Affordable Housing Agreement, City Note, City’s Deed of Trust, Regulatory Agreement, and Covenant are sometimes collectively referred to herein as the “City Agreements." National CORE also applied for and received a necessary determination from the County Counsel’s office of Orange County of an Affordable Housing Development Restrictive Covenant Modification under Civil Code Section 714.6 (“Restrictive Covenant Modification”) which has been or will be recorded.

C. National CORE applied to the City for and received approval of various land use approvals and permits described herein necessary or required for development of the Affordable Housing Project (collectively, the “Entitlements”). National CORE engaged RRM Design Group (the “Architect”), Fuscoe Engineering (the “Civil Engineer”), as well as other professionals and consultants, in order to develop and prepare a planning submittal package for the Affordable Housing Project. Departments of the City gave necessary approval to a conceptual site plan and building elevations for the Affordable Housing Project, as well as to other necessary ancillary material comprising the Entitlements. The City approved Streamlined Housing Permit (SHP) 01- 25-5767 for the demolition of the existing office building on the Property and construction thereon of a 50-unit affordable housing apartment community. National CORE submitted proposed plans, specifications and elevations, including all necessary demolition, building, structural, electrical, mechanical, plumbing, environmental and landscaping plans (collectively, “Plans and Specifications”) to the City for review and approval, and the City has approved the same; necessary demolition, grading, and construction permits for construction of the Affordable Housing Project are ready to issue upon payment of necessary fees and costs to the City.

D. To satisfy provisions of Section 7.3 of the Affordable Housing Agreement, transfer to Interim Owner by National CORE of its interest as the purchaser of the Property was permitted with the consent of the City. On _______________, 2026, using the proceeds of the City Loan and other funding, Interim Owner became the owner of the Property. The Covenant, the City’s Deed of Trust and the City Regulatory Agreement were all recorded concurrently with Interim’s Owner’s acquisition of title to the Property.

E. Assignor is the manager and sole member of NCRC Aspen Court MGP LLC, a California limited liability company (the “General Partner”), which is the general partner of the Project Partnership. The Project Partnership was formed by Assignor for the purpose of serving as the “tax credit partnership” in order to own the Property and to construct, equip, operate and maintain the Affordable Housing Project.

F. Sufficient funding has now been awarded to National CORE and/or the Affordable Housing Project to permit the development and construction of the Affordable Housing Project to move forward. National CORE and the Interim Owner have requested that the City consent to transfer of title to the Property, as well as transfer of the Entitlements, the Plans and Specifications, all contract rights relating thereto, and of National CORE’s rights and obligations under the Affordable Housing Agreement, to the Project Partnership. Transfer of title to the Property by Interim Owner to the Project Partnership will be made subject to the liens and obligations of the Docusign Envelope ID: 14BB40FF-FD5C-4ED6-839F-8CD7C585A9C9 Item: 7
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3 [Tax Credit Partnership]
Assignment and Assumption Agreement
City Note, the City’s Deed of Trust and the Regulatory Agreement as well as all applicable requirements of the Affordable Housing Agreement. Upon transfer and assignment to the Project Partnership of title of the Property and of National CORE’s rights under the Affordable Housing Agreement, the Project Partnership will be deemed to be the “Borrower” under the Affordable Housing Agreement.

G. The Interim Owner desires to transfer to the Project Partnership the Interim Owner’s interest in the Property and the obligations arising under the City Note, City’s Deed of Trust and Regulatory Agreement. Concurrently therewith, National CORE desires to transfer to the Project Partnership its interest in the Entitlements, the Plans and Specifications, all other ancillary material comprising or ancillary to any of the foregoing, as well as its rights under the Restrictive Covenant Modification and under the Affordable Housing Agreement. All real and personal property, tangible and intangible rights, obligations and other matters assigned and transferred from Interim Owner and National CORE to the Project Partnership are collectively described in this Agreement as the “Assigned Matters.” The Project Partnership desires to acquire title to the Property and to acquire from National CORE and the Interim Owner their respective rights to ownership of the Property and under the Affordable Housing Agreement. The Project Partnership also agrees to assume all of National CORE’s obligations under the Affordable Housing Agreement and the other Assigned Matters, and also to assume the obligations of Interim Owner relating to the City Note, the City’s Deed of Trust, and the Regulatory Agreement.

Notwithstanding the foregoing, however, National CORE excludes from the various assignments described in this Agreement National CORE’s rights and obligations as the “Developer” of the Affordable Housing Project, which the Parties understand will be defined more specifically in an amended and restated agreement of limited partnership for NCRC Aspan Court LP (an “ARALP”) enabling admission of an investor as a limited partner thereof, as well as under an accompanying development agreement between the Project Partnership and National CORE. National CORE must retain its title and obligations as Developer in order to carry out its responsibilities as the developer of the Project and to be paid a developer’s fee therefore, as the Parties anticipate will be provided more specifically in the ARALP and documents ancillary thereto.

H. Except for matters reserved under Recital G above, by their execution hereof the Interim Owner and National CORE desire to confirm the transfer of title of the Property to the Project Partnership and assignment to the Project Partnership of all of National CORE’s right, title and interest in and to the Affordable Housing Agreement and all of the other Assigned Matters. By its execution hereof, the Project Partnership confirms its assumption of all obligations under the Affordable Housing Agreement and all other executory obligations arising under the City Note, City’s Deed of Trust, Regulatory Agreement and other items constituting the Assigned Matters being assigned hereunder.

I. This Agreement confirms the actions taken to assign the Assigned Matters to the Project Partnership on the date of this Agreement. In its capacity as the “Developer” and as the manager and sole member of the General Partner of Assignee, National CORE will have a continuing economic interest in the Affordable Housing Project and will benefit from assignment of the items described herein for use by the Project Partnership.

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4 [Tax Credit Partnership]
Assignment and Assumption Agreement
NOW, THEREFORE, Assignor and Assignee hereby agree as follows:

1. Assignment.

1.1 Assignment of Assignor. By its execution hereof and by delivery of this Agreement to Assignee, Assignor confirms that, except as otherwise provided in Recital G above, they hereby transfer, convey and assign to Assignee all of Assignor’s right, title and interest in and to all of the Assigned Matters and, except as provided in Section 1.3, all representations, warranties and guaranties (whether written or oral), potential or existing legal or equitable rights, claims and causes of action and all other similar, and all related, contractual rights connected with or relating to the Affordable Housing Project. National CORE shall, at Assignee’s reasonable request, cooperate in transitioning to Assignee the services of any consultants which have provided services to National CORE in connection with the Plans and Specifications or any other aspect of the Affordable Housing Project being transferred to the Project Partnership hereby.

1.2 Acknowledgement of Assumption. Assignee expressly assumes, acknowledges and agrees for the benefit of City to be bound by, and to perform and comply with, every obligation of Assignor associated with the City Agreements and any and all other matters associated with the Assigned Matters from and after the date of this Agreement. The Parties explicitly agree and confirm that City shall have the same rights and remedies as against the Assignee from and after the effective date of this Agreement as City had against National CORE under the terms and provisions of the Affordable Housing Agreement and the other Assigned Matters and as against the Interim Owner under the terms and provisions of the City Note, City’s Deed of Trust and the Regulatory Agreement prior to the effective date of this Agreement, with the same force and effect as though every such duty, obligation, responsibility, right or remedy were set forth herein in full. In the event of any default or breach under the City Agreements arising from and after the effective date of this Agreement, City may proceed directly against Assignee, any guarantors, or anyone else liable under the City Agreements without first exhausting City’s remedies against any other person or entity liable under the City Agreements to City pursuant to the express terms and conditions of the City Agreements.

1.3 Retained Rights. In addition to retaining its rights to act as the “Developer” of the Affordable Housing Project, National CORE retains nonexclusive rights and interest in and to all warranty rights or indemnity rights (including defense and other related rights) and any and all other rights and claims against any person relating to any event with respect to any claim (whether valid or invalid) which is at any time made against National CORE under, and/or related to any of the Assigned Matters; provided, however, that the Assignee will have the primary/leading role in enforcing any such rights and/or claims but subject to its reasonable cooperation with National CORE.

1.4 Confirmation. Assignee agrees that it is acquiring Assignor’s interest in the Assigned Matters upon all of the terms contained in this Agreement, as well as assuming all of the duties and obligations of the Assignor arising from or relating to the Affordable Housing Agreement and the other Assigned Matters.

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5 [Tax Credit Partnership]
Assignment and Assumption Agreement

2. Acceptance and Assumption. Assignee hereby accepts the assignment of the items, rights, and obligations as provided in Section 1 and assumes the responsibility of performing any and all of the obligations and duties of Assignor under and/or related to any of such Assigned Matters as provided in Section 1.2, and to execute all documents and instruments which Assignor was, is or will be obligated to execute under the provisions of any of the Assigned Matters.

3. Further Assurances. National CORE and Interim Owner will each execute and deliver any and all additional papers, documents and other assurances, and will do any and all acts and things reasonably necessary to accomplish the assignment set forth in Section 1. If any of the Assigned Matters may not be assigned to Assignee (because of a contractual, legal or other restriction or prohibition), then upon Assignee’s written request Assignor will enforce such Assigned Matters for and on behalf of Assignee with an attorney selected by Assignee; provided, however, that Assignor will not be required to pay any out-of-pocket expenses for such enforcement. Assignor will cooperate with Assignee in obtaining the consent of any third party whose consent is required for Assignor to implement the assignment described in Section 1 above.

4. Successors and Assigns. This Agreement will be binding upon and inure to the benefit of the successors and assigns of Assignor and Assignee.

5. Assignee Dissolution. If at any point prior to the full repayment and satisfaction of the City Loan, the Assignee ceases to exist or enters bankruptcy proceedings, this Agreement shall be immediately null and void, without the need for any further action by any party. In the preceding instances, any and all rights and responsibilities owed to the City pursuant to the City Agreements shall fully revert to National CORE, and National CORE shall be fully liable to the City under the City Agreements, both as if this Agreement had never been executed or effective. If the preceding occurs any reversion, and subsequent transfer of liability to National CORE, shall not be limited or modified by the date of the dissolution or bankruptcy of the Assignee; National CORE shall be liable for the entirety of all debts, obligations, and otherwise included in the City Agreements.

6. Attorneys’ Fees. In any action between Assignor and Assignee involving this Agreement or the Assigned Matters, the prevailing party will be entitled to recover from the other party, in addition to damages, injunctive or other relief, if any, all costs and expenses (whether or not allowable as “cost” items by law) reasonably incurred at, before and after trial or on appeal, or in any bankruptcy or arbitration proceeding including, without limitation, attorneys’ fees, witness fees (experts and otherwise), deposition costs, copying charges and other expenses.

7. Interpretation. This Agreement is made and entered into in the State of California and will in all respects be interpreted, enforced and governed under the laws of the State of California. The language in all parts of this Agreement will be in all cases construed as a whole according to their fair meaning and not strictly for or against either Assignor or Assignee. This Agreement has been negotiated and prepared by both Assignor and Assignee. Any rule of contract interpretation to the effect that ambiguities or uncertainties are to be interpreted against the drafting party, or the party that caused it to exist, will not be employed in the interpretation of this Agreement.

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6 [Tax Credit Partnership]
Assignment and Assumption Agreement

8. Incorporation. The Recitals set forth in the beginning of this Agreement are incorporated into the operative provisions hereof.

9. Severability. If any term, provision, condition or covenant of this Agreement or its application to any party or circumstance is held to be, to any extent, invalid or unenforceable, then the remainder of this Agreement, or the application of such term, provision, condition or covenant to any party or circumstances other than those as to whom or which it is held invalid or unenforceable will not be affected and will be valid and enforceable to the full extent permitted by law.

10. Authority. Each person signing this Agreement represents and warrants that he or she has the proper authority to bind the party on whose behalf he or she signs this Agreement.

11. Amendment. This Agreement may not be amended or modified except by a writing signed by Assignor and Assignee which expressly states that it amends this Agreement.

12. Indemnification of the Assignee by Assignor. Assignor will, to the fullest extent permitted by law, indemnify, defend (with legal counsel reasonably acceptable to the Assignee), protect and hold harmless the Assignee and the partners, members, directors, officers, employees, agents, successors and assigns thereof from and against any and all claims, actions, causes of action, rights, defenses, demands, allegations, damages, fines, penalties, liabilities, losses, liens, obligations, judgements, awards, appeals, costs and expenses (including, but not limited to, reasonable fees and costs of attorneys, expert witnesses and other consultants) of any kind or character at law, in equity or otherwise, regarding, arising out of or in connection with, or in any manner related to (i) any of the Assigned Matters prior to the date hereof, and (ii) any breach or default by Assignor under this Agreement.

13. Counterparts. This Agreement may be executed in counterparts, each of which will be deemed an original but all of which will together constitute one and the same instrument.

[THIS SPACE LEFT BLANK INTENTIONALLY;
SIGNATURES ARE ON THE FOLLOWING PAGES]

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S-1
[Tax Credit Partnership]
Assignment and Assumption Agreement

ASSIGNORS

NATIONAL CORE:

National Community Renaissance of California

By: __________________________________
(Name) (Title)

ASSIGNEE:

NCRC Aspan Court LP

By its General Partner
NCRC Aspan Court MGP LLC

By its Manager
National Community Renaissance of California

By: __________________________________
(Name) (Title)

INTERIM OWNER:

NCRC AC Holdings LLC

By its Manager
National Community Renaissance of California,
a California nonprofit public benefit corporation

By:_________________________________
Name:_________________________________
Title:_________________________________

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S-2
[Tax Credit Partnership]
Assignment and Assumption Agreement
The City of Lake Forest and the City of Lake Forest Housing Authority (collectively, “City”) execute this instrument solely to acknowledge (i) their approval of the form of this Assignment and Assumption Agreement [Tax Credit Partnership], (ii) the acceptability of NCRC Aspan Court LP as the “Tax Credit Partnership” under the Amended and Restated Affordable Housing and Loan Agreement (“Affordable Housing Agreement”), (iii) the transfer to the extent provided herein of National CORE’s right, title and interest in, to and under the Affordable Housing Agreement to NCRC Aspan Court LP, (iv) the transfer of title to the Property to NCRC Aspan Court LP, and (v) assumption by NCRC Aspan Court LP of the obligations under the City Note, City’s Deed of Trust, and the Regulatory Agreement, all as provided herein.

City of Lake Forest,
a California municipal corporation

By: ______________________
______________________,
City Manager

City of Lake Forest Housing Authority,
a California municipal corporation

By: ______________________
Name: ______________________
Its: ______________________

ATTEST:

By: ____________________________
City Clerk

APPROVED AS TO FORM:

Best, Best & Krieger LLP

By: ____________________________
City Attorney

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CITY COUNCIL AGENDA REPORT
MEETING DATE: 03/03/2026
DEPARTMENT: Finance
SUBJECT:

FISCAL YEAR 2025-26 MID-YEAR BUDGET REVIEW
RECOMMENDED ACTION(S):

Adopt a Resolution titled: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LAKE FOREST, CALIFORNIA, AMENDING THE 2025-2027 OPERATING BUDGET; AMENDING THE 2025-2032 CAPITAL IMPROVEMENT PLAN, AMENDING APPROPRIATIONS FOR FISCAL YEAR 2025-26.

EXECUTIVE SUMMARY:

Consistent with the Council adopted financial policies, the Mid-Year Budget Review Report (“Report”) provides an update on the City’s 2025-2027 Operating Budget and the financial condition of Fiscal Year 2025-26. Proposed changes to Fiscal Year 2025-26 appropriations of the 2025-2027 Operating Budget are detailed in (Attachment 1). The Report recommends a proposed $115,600 increase in General Fund revenues (Attachment 2) and a $60,000 increase in General fund cost estimates (Attachment 3) and adjustments to other funds to align with actual activity to date (Attachment 4). The proposed changes to other funds would result in a $918,200 decrease in revenue and an $858,500 increase in appropriations. Additional funding would be provided for one existing Capital Improvement Plan (“CIP”) project, and two new CIP projects are proposed, resulting in a net increase of $340,000 to the 2025–2032 Capital Improvement Plan, and the budget remains balanced.

The proposed Mid-Year Budget Review Report also includes updates to the 2025-2032 Capital Improvement Plan (“CIP”), including the addition of two new Capital Improvement Plan (“CIP”) projects (Attachments 5-7). The proposed changes would add $340,000 to the 2025-2032 Capital Improvement Plan (“CIP”). Adopting these changes ensures the first year of 2025-2027 Operating Budget (Fiscal Year 2025-26) reflects the most current and accurate financial information. Staff recommend the City Council adopt a resolution amending appropriations for FY 2025-26 to effectuate the proposed changes (Attachment 8).

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DISCUSSION:

The report covers recommended changes as part of the biennial Mid-Year Budget Review process. These changes include various adjustments to the adopted budget for the current Fiscal Year 2025-26.

Fiscal Year 2025-26
Staff recommend adjustments to revenue and appropriations for the current Fiscal Year 2025-26 to align with the City’s long-term financial vision, financial integrity, and Strategic Plan initiatives. Staff continuously monitor spending, economic indicators, consultant projections, and permit activity to uphold the City’s strong tradition of responsible fiscal management.

As part of this review, staff assessed the adopted budget against actual and projected financial conditions and programmatic priorities. This Report outlines the recommended budget adjustments based on the most current information available.

Proposed Mid-Year Budget Adjustments
The proposed Mid-Year Budget adjustments include a $115,600 increase in General Fund revenues, bringing the total General Fund revenue to $69,523,093 General Fund cost estimates will be increased by $60,000 and will be $66,623,899, ensuring the budget remains balanced. Staff believe these adjustments incorporate the most accurate financial information available and ensure the current budget accurately reflects updated financial projections within the 2025-2027 Operating Budget.

Summary of Proposed General Fund Revenues
Proposed General Fund revenue estimates for the current year incorporate the latest analysis and data. A 0.2% overall increase is proposed for General Fund revenues. Table 1 below details changes to General Fund revenue projections by type, with detailed explanations provided in Attachment 1 (Proposed Mid-Year Changes for FY 2025-26) and Attachment 2 (General Fund Revenue by Source).

Table 1: Fiscal Year 2025-26 General Fund Revenue Projections Revenue Type
FY 2025-26
Current
Budget
Increase
(Decrease)
FY 2025-26
Proposed
Budget
%
Change
Taxes
Property Taxes $28,143,200 $128,000 $28,271,200 0.5%
Real Property
Transfer Taxes 750,000 - 750,000 0.0%
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Revenue Type
FY 2025-26
Current
Budget
Increase
(Decrease)
FY 2025-26
Proposed
Budget
%
Change
Sales and Use
Taxes 17,931,600 - 17,931,600 0.0%
Transient
Occupancy Taxes 6,250,000 - 6,250,000 0.0%
Franchises 2,182,000 (40,000) 2,142,000 -1.8%
Intergovernmental 435,000 20,000 455,000 4.6%
Licenses and Permits 1,936,300 (400,000) 1,536,300 -20.7% Charges for Current
Service - Parks 1,249,900 - 1,249,900 0.0%
Charges for Current
Service 2,275,493 (348,200) 1,927,293 -15.3%
Developer Contributions 93,000 - 93,000 0.0%
Fines, Forfeitures, and
Penalties 790,000 - 790,000 0.0%
Facility and Park
Rentals, Leases 1,091,000 10,000 1,101,000 0.9%
Investment Earnings 6,000,000 700,000 6,700,000 11.7%
Other Revenues 280,000 45,800 325,800 16.4%
Total $69,407,493 $ 115,600 $ 69,523,093 0.2%
Summary of Proposed General Fund Cost Estimates
Proposed General Fund cost estimates for the current year incorporate the latest analysis and data. A 0.1% overall increase is proposed for General Fund cost estimates. Table 2 below details changes to General Fund cost estimates by Program Area, with detailed explanations provided in Attachment 1 (Proposed Mid-Year Changes for FY 2025-26) and Attachment 3 (General Fund Cost Estimates by Program Area).

Table 2: Fiscal Year 2025-26 General Fund Cost Estimate Projections Program Area
FY 2025-26
Current
Budget
Increase
(Decrease)
FY 2025-26
Proposed
Budget
%
Change
Legislative $ 381,700 - $ 381,700 0.0%
Management and
Support 10,945,350 - 10,945,350 0.0%
Public Safety 24,875,900 - 24,875,900 0.0%
Infrastructure
Maintenance Service 12,716,600 $60,000 12,776,600 0.5%
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Program Area
FY 2025-26
Current
Budget
Increase
(Decrease)
FY 2025-26
Proposed
Budget
%
Change
Planning, Engineering,
Building & Safety 7,574,136 - 7,574,136 0.0%
Transportation 509,600 - 509,600 0.0%
Environmental Services 1,206,400 - 1,206,400 0.0%
Culture, Leisure, &
Recreation 5,256,520 - 5,256,520 0.0%
Community Vitality &
Engagement 3,098,013 - 3,098,013 0.0%
Total $66,563,899 $ 60,000 $66,623,899 0.1%
Summary of Proposed Other Fund Revenues
Proposed revenue projections for all other funds are presented in Table 3 below, with further details in Attachment 4 (Estimated Revenue/Appropriation Adjustments to Other Funds). These adjustments reflect the latest data available on revenue and costs for these funds.

Table 3: Fiscal Year 2025-26 Other Fund Revenue Projections Fund Name
FY 2025-26
Current
Budget
Increase
(Decrease)
FY 2025-26
Proposed
State Gas Tax HUTA $2,539,300 $17,800 $2,557,100
State GAS Tax RMRA 2,394,000 (36,000) 2,358,000
City Facilities Improvement 2,250,000 (400,000) 1,850,000 Foothill Circulation Phasing
Plan 1,018,000 (300,000) 718,000
Lake Forest Traffic Mitigation 776,706 (200,000) 576,706 Total $8,978,006 $(918,200) $8,059,806
Summary of Proposed Other Fund Cost Estimates
Proposed cost estimates in other funds are presented in Table 4 below, based on the most recent information available (Attachment 4). The adjustments in Table 5 reflect proposed General Fund Capital Improvement Plan Appropriations (Attachments 5-7).

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Table 4: Fiscal Year 2025-26 Other Fund Expenditure Appropriations Fund Name
FY 2025-26
Current Budget
Increase
(Decrease)
FY 2025-26
Proposed
Measure M2 Senior Mobility $195,700 $72,000 $267,700
Permanent Local Housing
Allocation Program 463,200 (4,500) 458,700
Foothill Circulation Phasing
Plan 13,661,869 791,000 14,452,869
Total $14,320,769 $858,500 $15,179,269
Summary of Proposed CIP Appropriations
Aliso Creek Drainage Repairs
This is an established CIP project to repair a deteriorated 18-inch storm drain outlet south of El Toro Road that became exposed due to creek bank erosion following a water main break. A design consultant is now under contract to advance the project. Additional funding is required due to unforeseen CEQA review and documentation requirements identified during preliminary design.

Osterman Solar Lighting Project
This project installs additional solar lighting along the pathway to and from Regency Park to address identified safety concerns, deter crime, and improve visibility for pedestrians. The improvements are needed to enhance public safety and ensure a safe path of travel for park users.

Foothill Ranch Parks Slope Landscape Improvements
This project removes Acacia vegetation along the slope adjacent to single-family homes and replaces it with drought-tolerant landscaping and water-efficient irrigation. Advancing the project is necessary to complete slope clearing prior to fire season in October and to strengthen the existing fire break to reduce wildfire risk to nearby homes.

Table 5: General Fund CIP Appropriations
Project Name
FY 2025-26
Current Budget
Increase
(Decrease)
FY 2025-26
Proposed
Aliso Creek Drainage Repairs $30,000 $20,000 $50,000
Foothill Ranch Parks Slope
Landscape Improvements - 120,000 120,000
Osterman Solar Streetlight - 200,000 200,000
Total $30,000 $340,000 $370,000
Conclusion
In conclusion, approval of the proposed adjustments would increase General Fund revenues by $115,600 and General Fund cost estimates by $60,000, while Item: 8
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maintaining a balanced General Fund budget. The proposed Mid-Year adjustment would decrease other fund revenues by $918,200, increase other fund appropriations by $858,500, provide additional funding for one existing Capital Improvement Plan (“CIP”) project, and add two new CIP projects, resulting in a net increase of $340,000 to the 2025–2032 Capital Improvement Plan. The proposed adjustments to revenues and appropriations updates the first year (i.e., Fiscal Year 2025-26) of the 2025-2027 Operating Budget utilizing the best available information at this time.

The proposed Resolution approving these budget adjustments is provided as Attachment 8 for City Council consideration. Staff recommend the City Council adopt the attached Resolution as presented and authorize the budget adjustments described in the Report.

FISCAL IMPACT:

The fiscal impact of the recommended action increases General Fund revenues by $115,600 and increases General Fund cost estimates by $60,000. This action decreases other funds revenue by $918,200 and increases other fund appropriations by $858,500. The proposed action would also increase funding for one existing CIP project and add two new CIP projects, resulting in a net increase to the 2025-2032 Capital Improvement Plan.

ATTACHMENTS:

1. Proposed Mid-Year Changes to FY 2025-26

2. General Fund Revenue by Source

3. General Fund Cost Estimates by Program Area

4. Estimated Revenue and Expenses of Other Funds

5. Aliso Creek Drainage Repairs CIP

6. Foothill Ranch Parks Slope Landscape Improvements CIP

7. Osterman Solar Streetlight Project CIP

8. Proposed Resolution
Initiated By: John Meza, Management Analyst
Submitted By: Kevin Shirah, Director of Finance/City Treasurer Approved By: Debra Rose, City Manager
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7 ATTACHMENT 1
Item: 8
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Proposed Mid-Year Fiscal Year 2025-2026 Changes
1 Summary of Proposed Changes:
General Fund Revenue Increase: $115,600
General Fund Cost Estimates Increase: $60,000
The 2025-2027 Operating Budget, Fiscal Year 2025-26 Revenue Estimates Proposed Changes to General Fund Estimated Revenues
1)Property Taxes – Current revenues received exceed the original estimate.

It is recommended that the revenue be increased by $128,000. 2)Franchises – Lower cable franchise fees have decreased from current projection, requiring a reduction of the anticipated collections by $40,000. 3)Intergovernmental State –Revenue to be increased by $20,000 to align with current SB 90 revenues.
4)Licenses and Permits –Revenues decreased by ($400,000) to align with current development.
5)Charges for Services – Net revenue decreased by ($348,000). a)Plan Check Fees, Encroachment Services, and Encroachment Deposits: Reduction to align with current development activity. b)Veterans Brick Program: Increased revenue from the Veterans Program’s popularity.
6)Facility and Park Rentals, Leases – Due to increased rentals, it is recommended that the revenue be increased by $10,000.
(7) Investment Income – An increase of $700,000 is anticipated given projected investment income.
(8) Other Revenues – Net revenue increased by $45,800.
a)Reimbursements: Increase in reimbursements for unemployment and workshops.
b)Other Revenue: Increase in auction proceeds.

The 2025-2027 Operating Budget, Fiscal Year 2025-26 Cost Estimates Item: 8
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Proposed Mid-Year Fiscal Year 2025-2026 Changes
2 Proposed Changes to General Fund Cost Estimates
(9) Infrastructure Maintenance Service – HVAC Upgrades needed for City Hall Server room for an additional $60,000
Proposed Changes to Other Funds
(10) Measure M Senior Mobility
Revenue – No changes requested.

Expenditure – A $72,000 increase to accommodate contract increase. (11) Permanent Local Housing Allocation
Revenue – No changes requested.

Expenditure – A reduction of $4,500 to align expenditures with available grant funding.
(12) Foothill Circulation Phasing Plan
Revenue – A $300,000 revenue decrease to align with current development activity.

Expenditure – This adjustment recognizes an unanticipated financial obligation estimated at $791,000.
(13) Lake Forest Traffic Mitigation
Revenue – A $200,000 revenue reduction to align with current development activity.

Expenditure – No changes requested.
(14) City Facilities Improvement
Revenue – A $400,000 revenue reduction to align with current development activity.

Expenditure – No changes requested.
(15) State Gas Tax
HUTA Revenue – An increase of $17,800 is anticipated based on the latest state estimates.

RMRA Revenue – A decrease of $36,000 is anticipated based on the latest state estimates.
(16) General Fund CIP
Revenue – No changes requested.

Expenditure – A $340,000 increase to accommodate additional CIP Projects
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Proposed Mid-Year Fiscal Year 2025-2026 Changes
3 1. Foothill Ranch Parks – increase $120,000

2. Osterman Solar Street Light – increase $200,000

3. Aliso Creek Drainage Project – increase $20,000
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City of Lake Forest
General Fund Revenue by Source
Fiscal Year 2025-26
Taxes (#) Current Budget
Mid-Year
Adjustment
Proposed
Amended
Budget % Change
Property Taxes (1) 28,143,200 128,000 28,271,200 0.6% Real Property Transfer Taxes 750,000 - 750,000 0.0% Sales and Use Taxes 17,931,600 - 17,931,600 0.0% Transient Occupancy Taxes 6,250,000 - 6,250,000 0.0% Franchises: (2) 2,182,000 (40,000) 2,142,000 -1.8% Total Taxes: 55,256,800 88,000 55,344,800 0.2% Intergovernmental (3) 435,000 20,000 455,000 4.6% Licenses and Permits (4) 1,936,300 (400,000) 1,536,300 -20.7% Charges for Current Service - Parks 1,249,900 - 1,249,900 0.0% Charges for Current Service (5) 2,275,493 (348,200) 1,927,293 -15.3% Developer Contributions 93,000 - 93,000 0.0% Fines, Forfeitures, and Penalties 790,000 - 790,000 0.0% Facility and Park Rentals, Leases (6) 1,091,000 10,000 1,101,000 0.9% Investment Earnings (7) 6,000,000 700,000 6,700,000 11.7% Other Revenues (8) 280,000 45,800 325,800 16.4% Total 69,407,493$ 115,600$ 69,523,093$ 0.2% Item: 8
219

City of Lake Forest
General Fund Cost Estimates by Program Area
Fiscal Year 2025-26
(#) Current Budget
Mid-Year
Adjustment
Proposed
Amended
Budget % Change
Legislative 381,700 - 381,700 0.0% Management and Support 10,964,350 - 10,964,350 0.0% Public Safety 24,875,900 - 24,875,900 0.0% Infrastructure Maintenance Service (9) 12,716,600 60,000 12,776,600 0.5% Planning, Engineering, Building & Safety 7,574,136 - 7,574,136 0.0% Transportation 509,600 - 509,600 0.0% Environmental Services 1,206,400 - 1,206,400 0.0% Culture, Leasure, & Recreation 5,256,200 - 5,256,200 0.0% Community Vitality & Engagement 3,079,013 - 3,079,013 0.0% Total 66,563,899$ 60,000$ 66,623,899$ 0.1% Item: 8
220

City of Lake Forest
Estimated Revenue/Appropriation Adjustments
Other Funds
Fiscal Year 2025-26
(#)
Revenue
Adjustments
Appropriation
Adjustments
Net
Increase/(Decrease)
to Fund Balance
Measure M2 Senior Mobility (10)
Contractual Services - 72,000
Net increase (decrease) in fund balance (72,000)
Permanent Local Housing Allocation (11)
Personnel Services - (4,560)
Net increase (decrease) in fund balance 4,560
Foothill Circulation Phasing Plan (13)
Developer Contributions (300,000) 791,000
Net increase (decrease) in fund balance
(1,091,000)
Lake Forest Traffic Mitigation (14)
Developer Contributions (200,000) -
Net increase (decrease) in fund balance
(200,000)
City Facilities Improvement (15)
Developer Contributions (400,000) -
Net increase (decrease) in fund balance
(400,000)
State Gas Tax (16)
HUTA - Local Streets and Roads 17,800 -
RMRA - Local Streets and Roads (36,000) - Net increase (decrease) in fund balance
(18,200)
General Fund CIP
Capital (17)
Net increase (decrease) in fund balance - 340,000 (340,000)
Item: 8
221

ATTACHMENT 5
Item: 8
222

Asset Management Condition:5 - Poor/Failed
PROJECT DESCRIPTION:

Drainage repairs at various locations along Aliso Creek. The first location is a storm drain pipe on the southside of El Toro Road opposite Northcrest flowing into Aliso Creek. The second location is slope repairs along the Aliso Creek access road east of Trabuco Road.

ESTIMATED ANNUAL COST IMPACT OF PROJECT ON CITY OPERATING BUDGET:

This project would provide preventative maintenance and/or rehabilitation, which would reduce annual maintenance costs for erosion control.

Strategic Plan Goal: A. Our Livable City is well planned, attractive, and safe.

Strategic Plan Priority Area:2. Attractive: Investment and maintenance in public facilities, infrastructure, and natural resources that enhance the visual character of the city and supports quality neighborhoods
Strategic Plan Strategy: a) Proactively enhance the visual character of the city and plan for maintenance of all City assets.

CATEGORY: Environmental
PURPOSE:

Strategic Plan Initiative: N/A
PROJECT NUMBER: 25E01
PROJECT NAME: Aliso Creek Drainage Repairs
RESPONSIBLE DEPARTMENT: Public Works (Engineering)
Project Location
Project LocationProject LocationProject Locations

Item: 8
223

FY FY FY FY FY
2025/26 2026/27 2027/28 2028/29 2029/30
Acquisition R/W
Pre-Design
Design 50,000 $
Const. Support 15,000 $
Construction 270,000 $
Miscellaneous
Contingency 15,000 $
Total Estimate 50,000$ 300,000$ - $ - $ -$

FY FY FY FY FY
2025/26 2026/27 2027/28 2028/29 2029/30
General Fund 50,000$ 300,000$ -$ -$ -$ Total Revenue 50,000$ 300,000$ - $ - $ -$ FY FY
2030/31 2031/32
Acquisition R/W $ -
Pre-Design $ -
Design $ 50,000
Const. Support $ 15,000
Construction $ 270,000
Miscellaneous $ -
Contingency $ 15,000
Total Estimate -$ - $ 350,000$ FY FY
2030/31 2031/32
General Fund -$ -$ $ 350,000 $ -
$ -
Total Revenue -$ - $ 350,000$

PROJECT

ESTIMATE
Funding Source

PROJECT

ESTIMATE TOTAL
Funding Source TOTAL

CURRENT AND FUTURE FUNDING

PRIOR YEAR FUNDING
$20,000 funding added for completing preliminay design in FY 2025/26 mid-year.

Item: 8
224

ATTACHMENT 6
Item: 8
225

Asset Management Condition:N/A
PROJECT DESCRIPTION:

This project removes the Acacia vegetation on the slope nearest the single family homes and the northside of the park. The Acacia vegetation will be replaced with drought tolerant landscaping and water efficient irrigation systems. The replacement of the vegetation also improves the fire break between the homes and the park.

ESTIMATED ANNUAL COST IMPACT OF PROJECT ON CITY OPERATING BUDGET:

This project would provide preventative maintenance and/or rehabilitation, which would reduce annual maintenance costs.

Strategic Plan Goal: A. Our Livable City is well planned, attractive, and safe.

Strategic Plan Priority Area:2. Attractive: Investment and maintenance in public facilities, infrastructure, and natural resources that enhance the visual character of the city and supports quality neighborhoods
Strategic Plan Strategy: a) Enhance the city's overall visual character, maintain city assets, and proactively reinvest in city assets
CATEGORY: Maintenance
PURPOSE:

Strategic Plan Initiative: N/A
PROJECT NUMBER: TBD
PROJECT NAME: Foothill Ranch Parks Slope Landscape Improvements RESPONSIBLE DEPARTMENT: Public Works (Maintenance)
Project Location

Item: 8
226

FY FY FY FY FY
2025/26 2026/27 2027/28 2028/29 2029/30
Acquisition R/W
Pre-Design
Design
Const. Support
Construction 120,000$
Miscellaneous
Contingency
Total Estimate 120,000$ - $ - $ - $ -$

FY FY FY FY FY
2025/26 2026/27 2027/28 2028/29 2029/30
General Fund 120,000$ -$ -$ -$ -$ Total Revenue 120,000$ - $ - $ - $ -$ FY FY
2030/31 2031/32
Acquisition R/W $ -
Pre-Design $ -
Design $ -
Const. Support $ -
Construction $ -
Miscellaneous $ -
Contingency $ -
Total Estimate -$ - $ - $
FY FY
2030/31 2031/32
General Fund -$ -$ $ 120,000 $ -
$ -
Total Revenue -$ - $ 120,000$ Funding Source TOTAL
Funding Source

PROJECT

ESTIMATE TOTAL

PROJECT

ESTIMATE

CURRENT AND FUTURE FUNDING

PRIOR YEAR FUNDING
$120,000 funding added in FY 2025/26 mid-year.

Item: 8
227

ATTACHMENT 7
Item: 8
228

Asset Management Condition:N/A
PROJECT DESCRIPTION:

Installation of solar streetlights along Osterman between Pittsford and Regency.

ESTIMATED ANNUAL COST IMPACT OF PROJECT ON CITY OPERATING BUDGET:

This project would provide additional lighting resources to address public safety and crime prevention, while enhancing the path of travel to/from Regency Park.

Strategic Plan Goal: A. Our Livable City is well planned, attractive, and safe.

Strategic Plan Priority Area:2. Attractive: Investment and maintenance in public facilities, infrastructure, and natural resources that enhance the visual character of the city and supports quality neighborhoods
Strategic Plan Strategy: b) Consistently invest in the City's facilities.

CATEGORY: Traffic
PURPOSE:

Strategic Plan Initiative: N/A
PROJECT NUMBER: TBD
PROJECT NAME: Osterman Solar Streetlight Project
RESPONSIBLE DEPARTMENT: Public Works (Engineering)
Project Location

Item: 8
229

FY FY FY FY FY
2025/26 2026/27 2027/28 2028/29 2029/30
Acquisition R/W
Pre-Design
Design
Const. Support
Construction 200,000$
Miscellaneous
Contingency
Total Estimate 200,000$ - $ - $ - $ -$

FY FY FY FY FY
2025/26 2026/27 2027/28 2028/29 2029/30
General Fund 200,000$ -$ -$ -$ -$ Total Revenue 200,000$ - $ - $ - $ -$ FY FY
2030/31 2031/32
Acquisition R/W $ -
Pre-Design $ -
Design $ -
Const. Support $ -
Construction $ -
Miscellaneous $ -
Contingency $ -
Total Estimate -$ - $ - $
FY FY
2030/31 2031/32
General Fund -$ -$ $ 200,000 $ -
$ -
Total Revenue -$ - $ 200,000$ Funding Source TOTAL
Funding Source

PROJECT

ESTIMATE TOTAL

PROJECT

ESTIMATE

CURRENT AND FUTURE FUNDING

PRIOR YEAR FUNDING
$200,000 funding added in FY 2025/26 mid-year.

Item: 8
230

5 6
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3 ATTACHMENT 8
Item: 8
231

5 6
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3 RESOLUTION NO. 2026-xx

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
LAKE FOREST, CALIFORNIA, AMENDING THE 2025-2027
OPERATING BUDGET; AMENDING THE 2025-2032

CAPITAL IMPROVEMENT PLAN, AMENDING
APPROPRIATIONS FOR FISCAL YEAR 2025-26
WHEREAS, the 2025-2027 Operating Budget was adopted by the City Council on June 3, 2025; and
WHEREAS, the 2025-2032 Capital Improvement Plan was adopted by the City Council on June 3, 2025; and
WHEREAS, the appropriations and revenue estimates for Fiscal Year 2025- 26 were adopted by the City Council on June 3, 2025; and WHEREAS, modifications are now required as a result of changes during Fiscal Year 2025-26.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LAKE

FOREST DOES HEREBY RESOLVE, DETERMINE, FIND AND ORDER
AS FOLLOWS:

Section 1. The City Council’s adoption of this Resolution is not a project within the meaning of the California Environmental Quality Act. Specifically, the City’s adoption of the Resolution is an administrative and fiscal function of the City that does not commit the City to any specific project or course of action. (State CEQA Guidelines, sections 15378(b)(4) & (b)(5).) Thus, no environmental review of the Resolution is required. The City Council hereby directs staff to prepare, execute and file with the Orange County Clerk a Notice of Exemption within five working days of the adoption of this Resolution.

Section 2. The appropriations are hereby authorized, and revenue estimates updated for Fiscal Year 2025-26 as reflected on Exhibit A to this Resolution.

Section 3. That, for FY 2025-26, the Director of Finance is hereby authorized to move appropriations between line items within departmental budgets in concurrence with Department Directors.

Section 4. That for FY 2025-26, the City Manager is hereby authorized to transfer appropriations from one department to another or between funds within Item: 8
232

5 6
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3 Item: 8
233

5 6
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3 the Operating Budget with notification to the City Council Audit Committee.

Section 5. That for FY 2025-26, the City Manager is hereby authorized to transfer appropriations from a capital improvement project to another existing project within the adopted Capital Improvement Plan with notification to the City Council Audit Committee.

Section 6. The City Clerk shall attest as to the adoption and execution of this Resolution and cause the same to be maintained in the permanent records of the City.

PASSED, APPROVED AND ADOPTED this __ day of ___ 2026, by the following vote, to wit:

ROBERT PEQUEÑO
MAYOR
ATTEST:
____________________________

THY MERRITT

CITY CLERK
APPROVED AS TO FORM:
____________________________

MATTHEW RICHARDSON

CITY ATTORNEY
Item: 8
234

STATE OF CALIFORNIA )

COUNTY OF ORANGE ) SS

CITY OF LAKE FOREST )
I, Thy Merritt, City Clerk of the City of Lake Forest, California, do hereby certify that the foregoing Resolution No. 2026- was duly passed and adopted at a regular meeting of the Lake Forest City Council on the ___ day of _____ 2026, by the following vote, to wit:

AYES: COUNCIL MEMBERS:

NOES: COUNCIL MEMBERS:

ABSTAIN: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:
____________________________

THY MERRITT

CITY CLERK
Item: 8
235

Item: 8
236

EXHIBIT A
General Fund Revenue Estimates by Type
Revenue Type FY 2025-26
Current Budget
Increase
(Decrease)
FY 2025-26
Proposed
Taxes
Property Taxes $28,143,200 $128,000 $28,271,200
Real Property Transfer Taxes 750,000 - 750,000
Sales and Use Taxes 17,931,600 - 17,931,600
Transient Occupancy Taxes 6,250,000 - 6,250,000
Franchises 2,182,000 (40,000) 2,142,000
Intergovernmental 435,000 20,000 455,000
Licenses and Permits 1,936,300 (400,000) 1,536,300
Charges for Current Service 3,525,393 (348,200) 3,177,193 Developer Contributions 93,000 - 93,000
Fines, Forfeitures, and Penalties 790,000 - 790,000
Facility and Park Rentals, Leases 1,091,000 10,000 1,101,000 Investment Earnings 6,000,000 700,000 6,700,000
Other Revenues 280,000 45,800 325,800
Total $69,407,493 $115,600 $69,523,093
General Fund Cost Estimates by Program Area
Program Area FY 2025-26
Current Budget
Increase
(Decrease)
FY 2025-26
Proposed Budget
Legislative $ 381,700 - $ 381,700
Management and Support 10,945,350 - 10,945,350
Public Safety 24,875,900 - 24,875,900
Infrastructure Maintenance Service 12,716,600 $60,000 12,776,600 Planning, Engineering, Building & Safety 7,574,136 - 7,574,136 Transportation 509,600 - 509,600
Environmental Services 1,206,400 - 1,206,400
Culture, Leisure, & Recreation 5,256,200 - 5,256,200
Community Vitality & Engagement 3,098,013 - 3,098,013
Total $66,563,899 $ 60,000 $66,623,899
Item: 8
237

Other Funds Revenue Estimates
Fund Name FY 2025-26
Current Budget
Increase
(Decrease)
FY 2025-26
Proposed
State Gas Tax HUTA 2,539,300 17,800 2,557,100
State Gas Tax RMRA 2,394,000 (36,000) 2,358,000
City Facilities Improvement 4,410,400 (400,000) 4,010,400 Lake Forest Traffic Mitigation 776,706 (200,000) 576,706 Foothill Circulation Phasing Plan 1,018,000 (300,000) 718,000 Total $11,138,406 $(918,200) $10,220,206
All Other Funds Operating Appropriations
Fund Name FY 2025-26 Current
Budget
Increase
(Decrease)
FY 2025-26
Proposed
Measure M2 Senior Mobility 195,700 72,000 267,700
Permanent Local Housing
Allocation Program 463,200 (4,500) 458,700
Foothill Circulation Phasing
Plan 13,661,869 791,000 14,452,869
Total $14,320,769 $858,500 $15,179,269
Capital Improvement Plan Appropriations
Funding
Source Project
Current
FY2025-26
Budget
Increase
(Decrease)
FY 2025-26
Proposed
General
Fund CIP
Aliso Creek Drainage
Repairs $30,000 $20,000 $50,000
General
Fund CIP
Foothill Ranch Parks Slope
Landscape Improvements - 120,000 120,000
General
Fund CIP Osterman Solar Streetlight - 200,000 200,000
Total $30,000 $340,000 $370,000
Item: 8
238