purposes of CFD No. 2022-1, including attorney's fees and other costs related to commencing and pursuing to completion any foreclosure of delinquent Special Taxes. "Approved Property" means all Assessor's Parcels of Taxable Property: (i) that are included in a Final Map that was recorded prior to the January 1"1 preceding the Fiscal Year in which the Special Tax is being levied, (ii) that have an assigned Assessor's Parcel Number from the County shown on an Assessor's Parcel Map for the individual Iot included on the Final Map, and (iii) that have not been issued a building permit on or before May l"tpreceding the Fiscal Year in which the Special Tax is being levied.
"Assessor's Parcel" means a lot or parcel of land designated on an Assessor's Parcel Map with an assigned Assessor's Parcel Number.
"Assessor's Parcel Map" means an official map of the Assessor of the County designating parcels by Assessor's Parcel Number.
"Assessor's Parcel Number" means that number assigned to an Assessor's Parcel by the County for purposes of identification.
"Assigned Special Tax" means the Special Tax ofthat name described in Section D below. "Backup Special Tax" means the Special Tax ofthat name described in Section D below. "Eonds" means any obligation to repay a sum of money, including obligations in the form of bonds, certificates of participation, long{erm leases, loans from government agencies, or loans from banks, other flnancial institutions, pravate businesses, or individuals, or long{erm contracts, or any refunding thereof, to which the Special Tax of CFD No. 2022-1 have been pledged. "Boundary Map" means a recorded map of the CFD which indicates the boundaries of the CFD. "Building Permit" means the first legal document issued by the City giving official permission for new construction. For purposes of this deflnition, "Building Permit" may or may not include expired or cancelled building permits, or any subsequent building permit document(s) authorizing new construction on an Assessor's Parcel that are issued or changed by the City after the first original issuance, as determined by the CFD Administrator, provided that following such determination the Maximum Special Tax that may be levied on all Assessor's Parcels of Taxable Property will be at least'1.1 times annual debt service on all outstanding Bonds plus the estimated annual Administrative Expenses.
"Building Square Footage" or "BSF" means the square footage of assessable internal living space, exclusive of garages or other structures not used as living space, as determined by reference to the Building Permit for such Assessois Parcel. "Calendar Year" means the period commencing January 1 of any year and ending the following December 31.
"CFD" or "CFD No.2022-1" means Community Facalities Distrlct No.2022-'l (Quartz Ranch) established by the City under the Act.
"CFD Administrator" means an official of the City, or designee thereof, responsible for determining the Special Tax Requirement, and providing for the levy and collection of the Special Taxes.
4853-3893-4543v3/200299-0009
L-Z
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 68
Menifee Mayor and City Council May 18, 2022
"City" means the City of Nilenifee, State of California "City Council" means the City Council of the City of Menifee, acting as the legislative body of CFD No. 2022-1 .
"Condominium Plan" means a condominium plan purusant to California Civil Code, Section 6624.
"Developed Property" means all Assessor's Parcels that: (i) are included in a Final Map that was recorded prior to the January l"tpreceding the Fiscal Year in which the Special Tax is being levied, (ii) have an Assessor's Parcel Number from the County shown on an Assessor's Parcel Map for the individual lot included on the Final Map, and (iii) for which a Building Permit for new conslruction was issued on or before May l"ipreceding the Fiscal Year in which the Special Tax is being levied.
"Exempt Property" means all Assessor's Parcels designated as being exempt from Special Taxes as provided for in Section F.
"Final Map" means a subdivrsion of property by recordation of a flnal map, parcel map, or lot line adjustment, pursuant to the Subdivision Map Act (California Government Code Section 66410 et seq.) or recordation of a Condominium Plan pursuant to California Civil Code Section 6624 that creates individual lots for which Building Permits may be issued without further subdivision. "Fiscal Year" means the period commencing on July 1sl of any year and ending the following June 30th.
"lndenture" means the indenture, fiscal agent agreement, resolution or other instrument pursuant to which Bonds are issued, as modified, amended and/or supplemented from time to time, and any instrument replacing or supplementing the same. "Land Use Category" means any of the categories listed in Table 1 of Section D. "Maximum Special Tax" means for each Assessor's Parcel, the maximum Special Tax, determined in accordance with Section D below, that can be levied by CFD No. 2022-'1 on such Assessor's Parcel.
"Multifamily Property" means all Assessor's Parcels of Developed Property for which a Building Permit has been issued for the purpose of constructing a building or buildings comprised of attached Residential Units available for rental by the general public, not for sale to an end user, and under common management, as determined by the CFD Administrator. "Non-Residential Property" means all Assessor's Parcels of Developed Property for which a Building Permit(s) was issued for a non-residential use. The CFD Administrator shall make the determrnation if an Assessor's Parcel is Non-Residential Property. "Partial Prepayment Amount" means the amount required to prepay a portion of the Special Tax obligation for an Assessor's Parcel, as described in Section G.2. "Prepayment Amount" means the amount required to prepay the Special Tax obligation in full for an Assessor's Parcel, as described in Section G.1.
4853-3893-4543v3/200299-0009
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"County" means the County of Riverside, State of California.
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 69
Menifee Mayor and City Council May 18, 2022
"Proportionately" means for Taxable Property that is (i) Developed Property, that the ratio of the actual Special Tax levy to the Assigned Special Tax is the same for all Assessor's Parcels of Developed Property, (ii) Approved Property, that the ratio of the actual Special Tax levy to the Maximum Special Tax is the same for all Assessor's Parcels of Approved Property, and (iii) Undeveloped Property or Provisional Undeveloped Property, that the ratio of the actual Special Tax levy per Acre to the Maximum Special Tax per Acre is the same for all Assessor's Parcels of Undeveloped Property or Provisional Undeveloped Property, as applicable. "Provisional Undeveloped Property" means all Assessor's Parcels of Taxable Property that would othenrise be classified as Exempt Property pursuant to the provisions of Section F, but cannot be classified as Exempt Property because to do so would be reduce the Acreage of all Taxable Property below the required minimum Acreage set forth in Section F. "Residential Property" means all Assessor's Parcels of Developed Property for which a Building Permit has been issued for purposes of constructing one or more Residential Units. "Residential Unit" or "RU" means a residential unit that is used or intended to be used as a domicile by one or more persons, as determined by the CFD Adminrstrator. An Accessory Dwelling Unit that shares an Assessor's Parcel with a Single Family Residential Property shall not be considered a Residential Unit for purposes of this RMA. "RMA" means this Rate and Method of Apportionment of Special Taxes. "Single Family Residential Property" means all Assessor's Parcels of Residential Property other than Multifamily Property.
"Special Tax" or "Special Taxes" means any ofthe special taxes authorized to be levied within CFD No. 2022-1 pursuant to the Act to fund the Special Tax Requirement. "Special Tax Requirement " means the amount required in any Fiscal Year to pay: (i) the debt service or the periodic costs on all outstanding Bonds due in the Calendar Year that commences in such Fiscal Year, (ii) Administrative Expenses, (iii) the costs associated with the release of funds from an escrow account, (iv) any amount required to replenish any reserve funds established in association with the Bonds (provided that the same amount was not prevaously levied), (v) an amount up to any anticipated shortfall due to Special Tax delinquencies and (vi) for the collection or accumulalion of funds for the acquisition or construction of facilities authorized by CFD No. 2022-1 or the payment of debt service on Bonds anticipated to be issued, provided that the inclusion of such amount does not cause an increase in the levy of Special Tax on Approved Property or Undeveloped Property as set forth in Steps Two or Three of Section E., less (vii) any amounts available to pay debt service or other periodic costs on the Bonds pursuant to the lndenture.
"Taxable Property" means all Assessor's Parcels within CFD No. 20221 , wnich are not Exempt Property.
"Taxable Unit" means either a Residential Unit or an Acre "Trustee" means the trustee, fiscal agent, or paying agent under the lndenture. "Undeveloped Property" means all Assessor's Parcels of Taxable Property which are not Developed Property, Approved Property, or Provisional Undeveloped Property. 4853-3893-4543v3/200299'0009
c-4
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 70
Menifee Mayor and City Council May 18, 2022
B. SPECIAL TAX
Commencing Fiscal Year 2022-2023 and for each subsequent Fiscal Year, the City Council shall levy Special Taxes on all Taxable Property, up to the applicable Maximum Special Tax, to fund the Special Tax Requirement.
C. ASSIGNMENT TO LAND USE CATEGORY FOR SPECIAL TAX
Each Fiscal Year, beginnang with Fiscal Yeat 2022-2023, each Assessor's Parcel within CFD No. 2022-1 shall be classified as Taxable Property or Exempt Property. ln addition, each Assessor's Parcel of Taxable Property shall be further classified as Developed Property, Approved Property, Undeveloped Property or Provisional Undeveloped Property.
Assessor's Parcels of Developed Property shall further be classified as Residential Property or Non-Residential Property. Each Assessor's Parcel of Residential Property shall further be classified as a Single Family Residential Property or Multifamily Property. Each Assessor's Parcel of Single Family Residential Property shall be further assigned to a Land Use Category based on its Building Square Footage.
ln the event that there are Assessor's Parcel(s) for which one or more Building Permits for Residential Units have been issued and the County has not yet assigned final Assessor's Parcel Number(s) to such Assessor's Parcel(s) (in accordance with the Final Map or Condominium Plan), the amount of the Special Tax levy on such Assessor's Parcel for each Fiscal Year shall be determined as follows: (1) the CFD Administrator shall first determine an amount of the Maximum Special Tax for such Assessor's Parcel, based on the classification of such Assessor's Parcel as Undeveloped Propertyi (2) the amount of the Special Tax for the Residential Units on such Assessor's Parcel for which Building Permits have been issued shall be determined based on the Developed Property Special Tax rates and such amount shall be levied as Developed Property in accordance with Step 1 of Section E below; and (3) the amount of the Special Tax on the Taxable Property in such Assessor's Parcel not subject to the Special Tax levy in clause (2) shall be equal to: (A) the percentage ofthe Maximum Special Tax rate levied on Undeveloped Property pursuant to Step 3 of Section E below, multiplied by the total of the amount determined in clause (1), less (B) the amount determined in clause (2).
D. MAXIMUM SPECIAL TAX
1. Develooed Prooertv
The Maximum Special Tax for each Assessor's Parcel of Single Family Residential Property in any Fiscal Year shall be the greater of (i) the Assigned Special Tax for such Assessor's Parcel or (ii) the Backup Special Tax.
The Maximum Special Tax for each Assessor's Parcel of Multifamily Property and Non- Residential Property shall be the applicable Assigned Special Tax described in Table 'l of Section D.
a. Assiqned Special Tax
Each Fiscal Year, each Assessor's Parcel of Single Family Residential Property, Multifamily Property or Non-Residential Property shall be subject to an Assrgned Special Tax. The Assigned Special Tax for Fiscal Y ear 2022-2023 applicable to an Assessor's Parcel of Developed Property shall be determined pursuant to Table 1 below. 4853-3893-4543v3/200299-0009
c-5
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 71
Menifee Mayor and City Council May 18, 2022
Land Use Category
Taxable
Unit
Building Square
Footage
Assigned
Special Tax
Per Taxable
Un it
1. Single Family Residential Property RU Less than 1,900 sq. ft $2,781 00
2. Single Family Residential Property RU 1 ,900 sq. ft to 2,1 00 sq. ft $2,885 00
3. Sinole Family Residential Property RU 2,101 sq. ft to 2,300 sq. ft $2,923 00
4. Single Family Residential Property RU 2,301 sq. ft to 2,500 sq. ft $2,997 00
5. Sinqle Family Residential Propertv RU 2,501 sq. ft to 2,700 sq. ft $3,183 00
6. Single Family Residential Property RU 2,70'l sq. ft to 2,900 sq. ft $3,212 00
7. Sinqle Family Residential Propertv RU 2,901 sq. ft to 3,100 sq. ft $3,296 00
8. Single Family Residential Property RU 3,101 sq. ft to 3,300 sq. ft $3,380.00
9. Single Famiiy Residential Property RU 3,301 sq. ft to 3,500 sq. ft $3,547.00
10. Single Family Residential Property RU 3,501 sq. ft to 3,700 sq. ft $3,631.00 1 1 . Single Family Residential Property RU 3,701 sq. ft to 3,900 sq. ft $3.714.00 '12. Sinqle Family Residential Property RU Greater than 3,900 sq. ft $3,882 00 1 3. Multifamily Property Acre N/A $15,327 00
14. Non-Residential Property Acre N/A $15,327 00
TABLE 1
ASSIGNED SPECIAL TAX FOR DEVELOPED PROPERTY
FISCAL YEAR 2022.2023
On each July 1 , commencing July 1 , 2023, the Assigned Special Tax rate for Developed Property shall be increased by two percent (2.00%) of the amount in effect in the prior Fiscal Year.
b. Multiple Land Use Cateqories
ln some instances an Assessor's Parcel of Developed Property may contain more than one Land Use Category. The Maximum Special Tax levied on an Assessor's Parcel shall be the sum of the Maximum Special Tax for each Taxable Unit for all Land Use Categories located on the Assessor's Parcel. The CFD Administrator's allocation to each type of property shall be fi nal.
c. Backup Special Tax
The Backup Special Tax for an Assessor's Parcelwithin a Final Map classified as Single Family Residential Property or Approved Property expected to be classifled as Single Family Residential Property shall calculated according to the followrng formula. g=(UxA) /L
The terms above have the following meanings
B = Backup Special Tax per Assessor's Parcel classified as Single Family Residential Property or Approved Property expected to be classified as Single Family Residential Property within the Final Map.
U = lvlaximum Special Tax per Acre of Undeveloped Property per Section D.3 below 4853-3893-4543v3/200299-0009
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Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 72
Menifee Mayor and City Council May 18, 2022
A = Acreage of Single Family Residential Property expected to exist after build out in such Final Map at the time of calculation, as determined by the Adminishator L = Number of Assessor's Parcels of Single Family Residential Property expected to exist after build out in such Final Map at the time of calculation, as determined by the Administrator.
ln the event any portion of the Final Map is changed or modified, the Backup Specral Tax for all Assessor's Parcels within such changed or modified area shall be $15,327 per Acre.
Notwithstanding the foregoing, the Backup Special Tax for an Assessor's Parcel of Developed Property for which a certificate of occupancy has been granted may not be revised. ln the event any superseding Final Map is recorded as a Final Map within the boundaries of the CFD, the Backup Special Tax for all Assessor's Parcels within such Fanal Map shall be $15,327 per Acre. The Backup Special Tax shall not apply to Multifamily Residential Property or Non-Residential Property.
On each July 1, commencing July 1, 2023, the Backup Special Tax rate shall be increased by two percent (2.00%) of the amount in effect in the prior Fiscal Year.
2. Approved Propertv
The Maximum Special Tax for each Assessor's Parcel of Approved Property expected to be classified as Single Family Residential Property shall be the Backup Special Tax computed pursuant to Section D. l .c above.
The Maximum Special Tax for each Assessor's Parcel of Approved Property not expected to be classified as Single Family Residential Property shall be $15,327 per Acre.
On each July 1, commencing July 1, 2023, the Maximum Special Tax rate for Approved Property shall be increased by two percent (2.00%) of the amount in effect in the prior Fiscal Year.
3. Undeveloped ProperU and Provisional Undeveloped Property The Maximum Special Tax for each Assessor's Parcel of Undeveloped Property and Provisional Undeveloped Property shall be $15,327 per Acre.
On each July 1 , commencing July 1, 2023, lhe Maximum Special Tax rate for Undeveloped Property and Provisional Undeveloped Property shall be increased by two percent (2.00%) of the amount in effect in the prior Fiscal Year.
E. METHOD OF APPORTIONMENT OF THE SPECIAL TAX
Commencing Fiscal Year 2022 -2023 and for each subsequent Fiscal Year, the City Council shall levy Special Taxes on all Taxable Property in accordance with the following steps:
Step One The Special Tax shall be levied Proportionately on each Assessor's Parcel of Developed Property at up to '100% of the applicable Assigned Special Tax rates in Table 1 to satisry the Special Tax Requirement.
4853-3893-4543v3/200299-0009
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 73
Menifee Mayor and City Council May 18, 2022
Step Two lf additaonal moneys are needed to satisfy the Special Tax Requirement after the first step has been completed, the Special Tax shall be levied Proportronately on each Assessor's Parcel of Approved Property at up to 100% of the Maximum Special Tax applicable to each such Assessor's Parcel as needed to satisfy the Special Tax Requirement.
Step Three lf additional moneys are needed to satisfy the Special Tax Requirement after the first two steps have been completed, the Special Tax shall be levied Proportionately on each Assessor's Parcel of Undeveloped Property up to 100% of the Maximum Special Tax applicable to each such Assessor's Parcel as needed to satisfy the Specral Tax Requirement.
Step Four lf additional moneys are needed to satisfy the Special Tax Requirement after the first three steps have been completed, then the Special Tax levy on each Assessor's Parcel of Developed Property for which the Maximum Special Tax is the Backup Special Tax shall be increased in equal percentages from the Assigned Special Tax up to 100% ofthe Backup Specral Tax as needed to satisfy the Special Tax Requirement.
Step Five lf additional moneys are needed to satisfy the Special Tax Requirement after the first four steps have been completed, the Special Tax shall be levied Proportionately on each Assessor's Parcel of Provisional Undeveloped Property up to 100% of the Maximum Special Tax applicable to each such Assessor's Parcel as needed to satisfy the Special Tax Requirement.
Notwithstanding the above, under no circumstances will the Special Taxes levied in any Fiscal Year against any Assessor's Parcel of Residential Property as a result of a delinquency in the payment of the Special Tax applicable to any other Assessor's Parcel be increased by more than ten percent (10%) above the amount that would have been levied in that Fiscal Year had there never been any such delinquency or default.
F. EXEMPTIONS
The City shall classify as Exempt Property, in the following order of priority, (i) Assessofs Parcels which are owned by, irrevocably offered for dedication, encumbered by or restricted in use by the State of California, Federal or other local governments, including school districts, (ii) Assessor's Parcels which are used as places of worship and are exempt ftom ad valorem property taxes because they are owned by a religious organization, (iii) Assessor's Parcels which are owned by, irrevocably offered for dedication, encumbered by or restricted in use by a homeowners' association, (iv) Assessor's Parcels with public or utility easements making impractical their utilization for other than the purposes set forth in the easement, (v) Assessor's Parcels which are privately owned and are encumbered by or restricted solely for public uses, (vi) Assessor's Parcels which are classified as Non-Residential Property or (vii) Assessor's Parcels restricted to other types of public uses determined by the City Council, provided that no such classification would reduce the sum of all Taxable Property to less than 76.1 3 Acres.
Notwithstanding the above, the City Council shall not classify an Assessor's Parcel as Exempt Property if such classification would reduce the sum of all Taxable Property to less than 76.13 Acres. Assessor's Parcels which cannot be classified as Exempt Property because such classification would reduce the Acreage of all Taxable Property to less than 76.13 Acres will be 4853-3893-4543v3i200299-0009
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 74
Menifee Mayor and City Council May 18, 2022
classified as Provisional Undeveloped Property, and will be subject to Special Tax pursuant to Step Five in Section E.
G. PREPAYMENT OF SPECIAL TAX
"CFD Facilities" means $22,000,000 expressed in 2022 dollars, which shall increase by the Construction lnflation lndex on July 1 , 2023, and on each July 1 thereafter, or such lower amount (i) determined by the City Council as sufficient to provide the facilities under the authorized bonding program for CFD No. 2022-1, ot (ii) determined by the City Council concurrently with a covenant that it will not issue any more Bonds to finance additional facilities to be supported by Special Tax levied under this Rate and Method of Apportlonment. "Construction Fund" means an account speciflcally identified in the lndenture or functionally equivalent to hold funds, which are available for expenditure to acquire or construct facilities eligible to be financed by CFD No. 2022-1 .
"Construction lnflation lndex" means the greater ot (i\ 2o/o and (ii) the annual percentage change in the Engineering News-Record Building Cost Index for the city of Los Angeles, measured as of the Calendar Year which ends in the previous Fiscal Year. In the event this index ceases to be published, the Construction lnflation lndex shall be another index as determined by the City that is reasonably comparable to the Engineering News-Record Building Cost Index for the City of Los Angeles.
"Future Facilities Costs" means the CFD Facilities minus (i) amounts deposited in the Conslruction Fund, (ii) amounts deposited in any escrow accounts funded by the Outstanding Bonds and anticipated to fund public facilities costs, and (iii) public facility costs funded by interest earnings on the Construction Fund actually earned prior to the date of prepayment, but in no event shall such amount be less than zero.
"Outstanding Bonds" means all previously issued Bonds issued and secured by the levy of Special Tax which will remain outstanding after the first interest and/or principal payment date following the current Fiscal Year, excluding Bonds to be redeemed at a later date with the proceeds of prior prepayments of Special Tax.
1. Prepayment in Full
4853-3893-4543v3/200299-0009
t-v
The following additional definitions apply to this Section G:
The Special Tax obligation may be prepaid and permanently satisfied for (i) Assessor's Parcels of Developed Property, (ii) Assessor's Parcels of Approved Property or Undeveloped Property for which a Building Permit has been issued, (iii) Assessor's Parcels of Approved Property or Undeveloped Property for which a Building Permit has not been issued and (iv) Assessor's Parcels of Provisional Undeveloped Property. The Special Tax obligation applicable to an Assessor's Parcel may be fully prepaid and the obligation to pay the Special Tax for such Assessor's Parcel permanently satisfied as described herein; provided that a prepayment may be made only if there are no delinquent Special Taxes with respect to such Assessor's Parcel at the time of prepayment. An owner of an Assessor's Parcel intending to prepay the Special Tax obligation for such Assessor's Parcel shall provide the CFD Administrator with written notice of intent to prepay, and within 5 business days of receipt of such notice, the CFD Administrator shall notify such owner of the amount of the non-refundable deposit determined to cover the cost to be incurred by the CFD in calculating the Prepayment Amount (as defined below) for the Assessor's Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 75
Menifee Mayor and City Council May 18, 2022
Parcel. Within 15 days of receipt of such non-refundable deposit, the CFD Administrator shall notify such owner of the Prepayment Amount for the Assessor's Parcel. Prepayment must be made not less than 60 days prior to the redemption date for any Bonds to be redeemed with the proceeds of such prepaid Special Taxes.
The Prepayment Amount shall be calculated as follows (some capitalized terms are defined below):
plus
plus
plus
plus
less
Equals
Bond Redemption Amount
Redemption Premium
Future Facilities Amount
Defeasance Amount
Administrative Fees and Expenses
Reserve Fund Credit
Prepayment Amount
The Prepayment Amount shall be determined as of the proposed prepayment date as follows
1. Conlirm that no Special Tax delrnquencies apply to such Assessor's Parcel
2. For an Assessor's Parcel of Developed Property, compute the Maximum Special Tax for the Assessor's Parcel. For an Assessor's Parcel of Approved Property or Undeveloped Property for which a Building Permit has been issued, compute the Maximum Special Tax for the Assessor's Parcel as though it was already designated as Developed Property, based upon the Building Permit which has been rssued for the Assessor's Parcel. ForanAssessor's Parcel of Approved Property or Undeveloped Property for which a Building Permit has not been issued, or Provisional Undeveloped Property, compute the lvlaximum Special Tax for the Assessor's Parcel.
3. Divide the Maximum Special Tax derived pursuant to paragraph 2 by the total amount of Maximum Special Taxes that could be levied assuming build out of all Assessor's Parcels of Taxable Property based on the applicable Maximum Special Tax for Assessor's Parcels of Developed Property not including any Assessor's Parcels for which the Special Tax obligation has been previously prepaid.
4. Multiply the quotient derived pursuant to paragraph 3 by the principal amount of the Outstanding Bonds to determine the amount of Outstanding Bonds to be redeemed with the Prepayment Amount (the "Bond Redemption Amount").
5. Multiply the Bond Redemption Amount by the applicable redemption premium, if any, on the Outstanding Bonds to be redeemed (the "Redemption Premium").
6. Determine the Future Facilities Costs
7. Multiply the quotient derived pursuant to paragraph 3 by the amount determined pursuant to paragraph 6 to determine the amount of Future Facilities Costs for the Assessor's Parcel (the "Future Facilities Amount").
4853-3893-4543v3/200299-0009
c-10
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 76
Menifee Mayor and City Council May 18, 2022
8. Determine the amount needed to pay interest on the Bond Redemption Amount from the first bond interest and/or principal payment date following the current Fiscal Year until the earliest redemption date for the Outstanding Bonds on which Bonds can be redeemed from Special Tax prepayments.
9. Determine the Special Taxes levied on the Assessor's Parcel in the current Fiscal Year which have not yet been paid.
10. Determine the amount the CFD Administrator reasonably expects to derive from the investment of the Bond Redemptron Amount and the Redemption Premium from the date of prepayment until the redemption date for the Outstanding Bonds to be redeemed with the Prepayment Amount.
11. Add the amounts derived pursuant to paragraphs I and I and subtract the amount derived pursuant to paragraph '10 (the "Defeasance Amount").
12. Verify the administrative fees and expenses of the CFD, the cost to invest the Prepayment Amount, the cost of redeeming the Outstanding Bonds, and the cost of recording notices to evidence the prepayment of the Special Tax obligation for the Assessor's Parcel and the redemption of Outstanding Bonds (the "Administrative Fees and Expenses").
13. The reserve fund credit (the "Reserve Fund Credit") shall equal the lesser of: (a) the expected reduction in the reserve requirement (as defined in the lndenture), if any, associated with the redemption of Outstanding Bonds as a result of the prepayment, or (b) the amount derived by subtracting the new reserve requirement (as deflned in the lndenture) in effect after the redemption of Outstanding Bonds as a result of the prepayment from the balance in the reserve fund on the prepayment date, but in no event shall such amount be less than zero.
14. The Prepayment Amount is equal to the sum of the Bond Redemption Amount, the Redemption Premium, the Future Facilities Amount, the Defeasance Amount and the Administrative Fees and Expenses, less the Reserve Fund Credit.
15. From the Prepayment Amount, the Bond Redemption Amount, the Redemption Premium, and Defeasance Amount shall be deposited into the appropriate fund as established under the lndenture and be used to redeem Outstanding Bonds or make debt service payments. The Future Facilities Amount shall be deposited into the Construction Fund. The Administrative Fees and Expenses shall be retained by the CFD.
The Prepayment Amount may be sufficient to redeem other than a $5,000 increment of Bonds.
In such event, the increment above $5,000 or an integral multiple thereof will be retained in the appropriate fund established under the lndenture to be used with the next redemption from other Special Tax prepayments of Outstanding Bonds or to make debt service payments.
As a result of the payment of the current Fiscal Year's Special Tax levy as determined pursuant to paragraph 9 above, the CFD Administrator shall remove the current Fiscal Year's Special Tax levy for the Assessor's Parcel from the County tax roll. With respect to any Assessor's Parcel for which the Special Tax obligation is prepaid, the City Council shall cause a suitable notice to be recorded in compliance with the Act, to indicate the prepayment of Special Tax obligation and the release of the Special Tax lien for the Assessor's Parcel, and the obligation to pay the Special Tax for such Assessor's Parcel shall cease.
4853-3893-4543v3/200299-0009
c-1'1
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 77
Menifee Mayor and City Council May 18, 2022
Notwithstanding the foregoing, no Special Tax prepayment shall be allowed unless the amount of Maximum Special Tax that may be levied on all Assessor's Parcels of Taxable Property after the proposed prepayment will be at least 1 .1 times maximum annual debt service on the Bonds that will remain outstanding after the prepayment plus the estimated annual Administrative Expenses.
Tenders of Bonds in prepayment of the Special Tax obligation may be accepted upon the terms and conditions established by the City Council pursuant to the Act. However, the use of Bond tenders shall only be allowed on a case-by-case basis as specifically approved by the City Council.
2. Prepayment in Part
The Speclal Tax obligation for an Assessor's Parcel of Developed Property, Approved Property, Undeveloped Property, or Provisional Undeveloped Property may be partially prepaid. For purposes of determining the Partial Prepayment Amount, the provisions of Section G.1 shall be modified as provided by the following formula:
PP = Partial Prepayment Amount
PE = the Prepayment Amount calculated according to Section G.1 F = the percent by which the owner of the Assessor's Parcel(s) is partially prepaying the Special Tax obligation
A = the Administrative Fees and Expenses determined pursuant to Section G.1 The owner of an Assessor's Parcel who desires to partially prepay the Special Tax obligation for the Assessor's Parcel shall notify the CFD Administrator of (i) such owner's intent to partially prepay the Special Tax obligataon, (ii) the percentage of the Special Tax obligation such owner wishes to prepay, and (iii) the company or agency that will be acting as the escrow agent, if any.
Within 5 days of receipt of such notice, the CFD Administrator shall notifi/ such property owner of the amount of the non-refundable deposit determined to cover the cost to be incurred by the CFD in calculating the Partial Prepayment Amount. Within '15 business days of receipt of such non- refundable deposit, the CFD Admanistrator shall notify such owner of the amount of the Partial Prepayment Amount forthe Assessor's Parcel. A Partial Prepayment Amount must be made not less than 60 days prior to the redemption date for the Outstanding Bonds to be redeemed with the proceeds ofthe Partial Prepayment Amount.
With respect to any Assessor's Parcel for which the Special Tax obligation is partially prepaid, the CFD Administrator shall (i) distribute the Partial Prepayment Amount as provided in Paragraph 15 of Section G.1, and (ii) indicate in the records of the CFD that there has been a partial prepayment for the Assessor's Parcel and that a portion of the Special Tax obligation equal to the remaining percentage (1.00 - F) of the applicable Special Tax will continue to be levied on the Assessor's Parcel pursuant to Section E.
H. TERMINATION OF SPECIAL TAX
For each Fiscal Year that any Bonds are outstanding the Special Tax shall be levied on all Assessor's Parcels subjecttothe Special Tax pursuantto Section E. The Special Taxshall cease not later than the 2064-2065 Fiscal Year, however, Special Taxes will cease to be levied in an earlier Fiscal Year if the CFD Adminastrator has determined (i) that all the required interest and 4853-3893-4543v3/200299'0009
PP=((PE-A)xF)+A
These terms have the following meaning:
c-12
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 78
Menifee Mayor and City Council May 18, 2022
principal payments on the CFD No. 2022-1 Bonds have been paid; (ii) all authorized facilities of CFD No. 2O22-1 have been acquired and all reimbursements to the developer have been paid, (iii) no delinquent Special Taxes remain uncollected and (iv) all other obligations of CFD No. 2022- t have been satisfied.
I. MANNER OF COLLECTION
The Special Tax shall be collected in the same manner and at the same time as ordinary ad valorem Vopefty taxes, provided, however, that CFD No. 2022-1 may collect Special Taxes at a different time or in a different manner if necessary to meet its financial obligations, and may covenant to foreclose and may actually foreclose on delinquent Assessor's Parcels as permitted by the Act.
J. APPEALS OF SPECIAL TAXES
Any taxpayer may file a written appeal of the Special Taxes Ievied on his/her Assessor's Parcel(s) with the CFD Administrator, provided that the appellant is current in his/her payments of Special Taxes. During pendency of an appeal, all Special Taxes previously levied must be paid on or before the payment date established when the levy was made. The appeal must speciry the reasons why the appellant claims the Special Tax as in error. The CFD Administrator shall review the appeal, meet with the appellant if the CFD Administrator deems necessary, and advise the appellant of its determination. lf the CFD Administrator agrees with the appellant, the CFD Administrator shall grant a credit to eliminate or reduce future Special Taxes on the appellant's Assessor's Parcel(s). No refunds of previously paid Special Taxes shall be made unless approved by the CFD Administrator.
The CFD Administrator shall interpret this Rate and Method of Apportionment and make determinations relative to the annual levy and administration of the Special Taxes and any taxpayer who appeals, as herein specified.
4853-3893-4543v3/200299-0009
c-13
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 79
Menifee Mayor and City Council May 18, 2022
STATE OF CALIFORNIA
COUNTY OF RIVERSIDE
CITY OF MENIFEE
l, Stephanie Roseen, Acting City Clerk of the City of Menifee, do hereby certify that the foregoing City Council Resolution No. 22-'l 133 was duly adopted by the City Council of the City of Menifee at a meeting thereof held on the 6th ol April 2022 by the following vote.
SS
)
)
)
Ayes:
Noes:
Absent:
Abstain
Deines, Karwin, Liesemeyer, Sobek, Zimmerman
None
None
None
p anie Roseen, Acting City Clerk
MENIFEE
\#
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 80
Menifee Mayor and City Council May 18, 2022
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 81
Menifee Mayor and City Council May 18, 2022
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 82
Menifee Mayor and City Council May 18, 2022
1 4866-2281-3467v3/200299-0009
WAIVER OF CERTAIN ELECTION PROCEDURES
WITH RESPECT TO LANDOWNER ELECTION FOR
COMMUNITY FACILITIES DISTRICT NO. 2022-1
(QUARTZ RANCH) OF THE CITY OF MENIFEE
The undersigned, Geoffrey Smith, acting on behalf of the Lennar Homes of California, LLC, a California limited liability company (the “Owner”), hereby certifies to the City of Menifee (the “City”), with respect to the proposed formation of Community Facilities District No. 2022-1 (Quartz Ranch) of the City of Menifee (the “District”), as follows:
1. The undersigned has been duly authorized by the Owner and possesses all authority necessary to execute this Waiver on behalf of the Owner in connection with the election to be called by the City Council of the City with respect to the District. The Owner hereby appoints [Geoffrey Smith] to act as its authorized representative to vote in the election referred to herein and certifies that his true and exact signature is set forth below:
Signature of Geoffrey Smith: __________________________________
2. The Owner is the present owner of 80.4 acres of land located within the proposed boundaries of the District. To the actual knowledge of the undersigned, there are no registered voters residing within the territory owned by the Owner and have been none during the 90-day period preceding May 18, 2022.
3. The Owner has received notice of the May 18, 2022 public hearing to be held by the City Council of the City regarding the levy of a special tax in the District and the incurring of bonded indebtedness by the District. The Owner agrees that it received adequate notice of the May 18, 2022 hearing.
4. The Owner has received from the City and the City has made available to the Owner necessary and relevant information regarding the proposed formation of the District and the imposition of the special tax and the issuance of bonded indebtedness, as set forth in Resolutions No. 22-1133 and 22-1134 adopted by the City Council on April 6, 2022 (together, the “Resolutions”) to finance the facilities as set forth in the Resolutions.
5. The undersigned understands that if the District is formed on or after May 18, 2022, an election will be held by the District on the propositions set forth in the sample ballot attached hereto as Exhibit “A” less than 90 days after the close of the May 18, 2022 public hearing as in accordance with Section 53326 of the Government Code, without the preparation of an impartial analysis, arguments or rebuttals concerning the election as provided for by Elections Code Sections 9160 to 9167, inclusive, and 9190 and without preparation of a tax rate statement as provided in Section 9401 of the Elections Code and without further notice of such election as required pursuant to the Elections Code or the Government Code. Having been fully advised with respect to the election, in accordance with the authority contained in Government Code Sections 53326 and 53327, the Owner waives compliance with the foregoing provisions of the Elections Code and Government Code, with any time limits or other procedural requirements pertaining to the conduct of the election which are not being complied with and consents to having the election on any date on or after the close of the May 18, 2022 public hearing and consents to the closing of the election as soon as all ballots are received by the City Clerk.
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 83
Menifee Mayor and City Council May 18, 2022
2 4866-2281-3467v3/200299-0009
6. The undersigned hereby represents that compliance with the procedural requirements for conducting the election, including the receipt of any ballot arguments and impartial analysis and the time limitations which apply in connection with scheduling, mailing and publishing notices for such an election, are unnecessary in light of the fact that the undersigned has received sufficient information regarding the imposition of the special tax and the issuance of bonded indebtedness as set forth in the Resolutions to allow it to properly complete the attached ballot. The Owner further waives its right to make any protest or complaint or undertake any legal action challenging the validity of the election, the validity of any bonded indebtedness issued by the District as approved at the election, or the validity of the authorization of the special tax to finance facilities for the benefit of the District or to repay bonded indebtedness issued by the District in accordance with the rate and method of apportionment of special taxes provided in Resolution No. 22-1133 of the City Council of the City.
Dated: May __, 2022
LENNAR HOMES OF CALIFORNIA, LLC,
a California limited liability company
By: ___________________________
Name: _________________________
Title: __________________________
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 84
Menifee Mayor and City Council May 18, 2022
A-1
4866-2281-3467v3/200299-0009
EXHIBIT A
SAMPLE BALLOT
COMMUNITY FACILITIES DISTRICT NO. 2022-1
(QUARTZ RANCH) OF THE CITY OF MENIFEE
SPECIAL TAX AND SPECIAL BOND ELECTION
__________, 2022
PROPOSITION A: Shall Community Facilities District
No. 2022-1 (Quartz Ranch) of the City of Menifee (the
“District”) incur an indebtedness and issue bonds in the maximum principal amount of $27,000,000, with interest
at a rate or rates not to exceed the maximum interest
rate permitted by law, to finance the Facilities and the Incidental Expenses described in Resolution No. 22-
1133 of the City Council of the City of Menifee?
PROPOSITION B: Shall a special tax with a rate and
method of apportionment as provided in Resolution No.
22-1133 of the City Council of the City of Menifee be
levied to pay for the Facilities, Incidental Expenses and other purposes described in Resolution No. 22-1133,
including the payment of the principal of and interest on bonds issued to finance the Facilities and Incidental
Expenses?
YES______
NO_______
YES______
NO_______
PROPOSITION C: For each year commencing with
Fiscal Year 2022-23, shall the appropriations limit, as defined by subdivision (h) of Section 8 of Article XIII B of the California Constitution, for Community Facilities
District No. 2022-1 be an amount equal to $10,000,000?
YES______
NO_______
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 85
Menifee Mayor and City Council May 18, 2022
4863-2785-2828v3/200299-0009
COMMUNITY FACILITIES DISTRICT NO. 2022-1 (QUARTZ RANCH)
OF THE CITY OF MENIFEE
ACQUISITION, CONSTRUCTION AND FUNDING AGREEMENT
THIS ACQUISITION, CONSTRUCTION AND FUNDING AGREEMENT (the “Agreement”) is made and entered into by and between CITY OF MENIFEE (the “City”), acting for and on behalf of itself and COMMUNITY FACILITIES DISTRICT NO. 2022-1 (QUARTZ RANCH) OF THE CITY OF MENIFEE (the “Community Facilities District” or “CFD”) and LENNAR HOMES OF CALIFORNIA, LLC, a California limited liability company (the “Developer”), each individually a “Party” and collectively the “Parties.”
WHEREAS, Developer has requested that the City consider the formation of a community facilities district pursuant to the provisions of the Mello-Roos Community Facilities Act of 1982, as amended (the “Act”), and undertake proceedings for the authorization of special taxes and issuance of bonded indebtedness for the payment of the construction and/or acquisition of certain improvements to be owned, operated or maintained by the City, Eastern Municipal Water District (the “Water District”), Menifee Union School District (the “Menifee Union School District”), and Perris Union High School District (the “Perris School District”), as well as overhead utility undergrounding improvements required by the City as a condition of development (the “Utility Undergrounding”), and incidental expenses in accordance with the Act; and
WHEREAS, in order to proceed in a timely way with development of its property within the CFD which is described in the attached Exhibit “A” (the “Developer Property”), Developer desires to fund through the Community Facilities District (i) the City’s acquisition or construction of certain improvements that are to be owned, operated and maintained by the City or are otherwise required to be constructed by the City (i.e., the Utility Undergrounding) (“City Improvements”), as more particularly set forth and described in the Description of Cost Estimates attached hereto as Exhibit “B,” (ii) improvements included in the City’s fee programs (the “City Fee Facility Improvements”), as more particularly set forth and described in Exhibit “B,” and (iii) the improvements of the Water District, the Menifee Union School District, and the Perris School District described in Exhibit “C” hereto (the “Miscellaneous Improvements” and together with the City Improvements and the City Fee Facilities Improvements, collectively the “Improvements”); and WHEREAS, the City is authorized by the Act to form the CFD and to issue bonds secured by Special Taxes (as defined in Section 2.2) of the CFD (the “Bonds”) to fund the Improvements; and WHEREAS, the City Council has adopted the City’s policies and procedures concerning the use of special district financing programs to finance the Improvements (the “Policy”); and WHEREAS, the purpose of this Agreement is to constitute a formal understanding between Developer and the City (pursuant to the requirements of Government Code Section 53313.51 and other provisions of the Act and the Policy) concerning financial and other obligations and responsibilities related to the formation of the Community Facilities District and the Improvements to be financed by the Community Facilities District, when and if formed, to the extent funds are available, and to set forth the conditions upon which (1) the Community Facilities District will reimburse Developer or its designee for the cost of the City Improvements constructed by or on behalf of the Developer and (2) the Community Facilities District will fund the City Fee Facility Improvements thereby satisfying Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 86
Menifee Mayor and City Council May 18, 2022
2 4863-2785-2828v3/200299-0009
corresponding City fees; and (3) the Community Facilities District will also fund the Miscellaneous Improvements described in Exhibit “C.”
NOW, THEREFORE, it is mutually agreed between the respective Parties as follows:
1. Feasibility Study. The City has retained, at the Developer’s expense, the necessary consultants to analyze the proposed formation of the CFD, including the special tax consultant, bond counsel, and other consultants deemed necessary by the City. The Developer has advanced to the City a sum of money for such costs, all or a part of which may be eligible for reimbursement from the CFD in accordance with the Reimbursement Agreement dated as of April 1, 2022 (the “Reimbursement Agreement”) between the Developer and the City.
2. Sale of Bonds.
2.1 City Policies. The City Council has adopted the Policy, setting forth the City’s policies and procedures concerning the use of special district financing programs to finance the Improvements. Pursuant to the Policy, the total annual amount of the special taxes to be collected with respect to a parcel within the CFD and all other taxes and assessments which will be collected with respect to such parcel from the secured tax roll must not exceed two percent (2%) of the Fair Market Value (as defined in the Policy) of such parcel at the time of CFD formation.
The Parties hereby agree that, unless waived by the City, at the time of issuance of the Bonds, the ratio of the value of all parcels of property for which the Bonds are being issued to the amount of outstanding community facilities district or assessment district bonds attributable to such parcels (the “Value-to-Lien Ratio”) may not be less than four-to-one (4:1). Unless waived by the City, the Fair Market Value of the property within the Community Facilities District for purposes of determining the foregoing ratio will be determined based on the appraised value of the property based on the appraisal made by an appraiser selected by the City with a valuation date within three (3) months of the issuance of the Bonds, or, with respect to developed projects (as determined in the sole discretion of the City) or issuance of refunding bonds, the assessed value of the property, or some combination thereof.
Subject to satisfaction of the Policy and the requirements of this Agreement, the City shall use reasonable efforts to issue and sell the Bonds in one or more series in an amount sufficient to fund the Improvements in accordance with the schedule for development of the Developer Property. The ultimate decision as to issuance and sizing lies in the sole legislative discretion of the City.
2.2 Security for Payment of Special Taxes.
(a) Concurrently with the issuance and sale of each series of the Bonds, the owner of any land within the Community Facilities District which the City has determined, in its sole discretion, to use in the sizing of such series of Bonds (the “Sizing Property”), together with any Sizing Property owned by any affiliate (collectively, an “Account Party”), for which the Maximum Special Taxes for the then-current fiscal year (as defined in the Rate and Method of Apportionment of Special Tax for the Community Facilities District (the “Rate and Method”) and such Special Tax referred to herein as the “Special Tax” or “Special Taxes”), are equal to or exceed 20% of the aggregate Maximum Special Taxes authorized to be levied on the Sizing Property in such fiscal year, shall deliver to the City either (i) a renewable irrevocable instrument of credit from a financial institution (rated “A” or better) and approved by the City, or (ii) cash in-lieu thereof (a “Security”). The Security shall be in an amount equal to 200% of the product of the maximum annual debt service on the Bonds proposed to be issued times a fraction the numerator of which is the aggregate Maximum Special Taxes on the Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 87
Menifee Mayor and City Council May 18, 2022
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Sizing Property in the then current fiscal year applicable to the land owned by the Account Party and the denominator of which is the total Maximum Special Taxes applicable to all of the Sizing Property in such fiscal year (the “Stated Amount”). The Security shall be maintained by the Account Party in each fiscal year until terminated in accordance with Section 2.2(c) below. While the Security is still required the Stated Amount of such Security shall be reduced as set forth in a Certificate of Reduction or Termination (as defined in Section 2.2(c) below).
The Security shall name the Fiscal Agent as a beneficiary and shall provide that the Fiscal Agent may draw an amount equal to any delinquencies in payment of semiannual installments of the Special Taxes levied on property owned by the Account Party in the Community Facilities District.
The total amount to be drawn under the Security shall not exceed an amount equal to the Special Taxes owed by the Account Party with respect to property within the Community Facilities District that is delinquent at the time the draw is made. The amount drawn on the Security shall be applied in the same manner and for the same purposes as the delinquent Special Taxes would have been applied; provided, however the payment of a draw under the Security will not be deemed to cure the delinquency in payment of the Special Taxes.
If, subsequent to a draw on the Security and prior to the satisfaction of any reimbursements due to the institution providing the Security (the “Security Provider”) pursuant to this Agreement, the City receives payment of all or a portion of the delinquent Special Taxes or the proceeds of a sale of delinquent real property pursuant to foreclosure proceedings (“Delinquency Proceeds”) for a parcel for which the Security has been drawn, the Security Provider (or its designee, which may be the Developer) shall be reimbursed for such draws to the extent of Delinquency Proceeds net of the City’s costs of collection. The Security Provider is intended by the Parties to be a third party beneficiary of this Section 2.2.
(b) The Security shall be renewed, or a substitute Security reasonably satisfactory to the City (a “Substitute Security”) provided, not less than thirty (30) calendar days prior to the expiration of the Security or Substitute Security then in effect. If the Account Party provides a Substitute Security to the City, then the Fiscal Agent shall return any existing Security on the effective date of the Substitute Security to the Security Provider.
If the Security is not renewed within thirty (30) days prior to its expiration date and the requirements for release or termination of the Security as set forth in Section 2.2(c) below have not then been met, the full amount of the Security may be drawn by the Fiscal Agent and deposited in an account established under the Indenture (as hereinafter defined) or in such account established with a financial institution selected by the City. Thereafter, amounts in such account shall be held as security, and if Special Taxes owed by the Account Party with respect to property within the Community Facilities District are not paid prior to delinquency, then such amounts in such account may be applied by the City to pay the delinquent Special Taxes owed by the Account Party with respect to such property on the same terms and conditions applicable hereunder to draws on the Security.
At such time as the Security is renewed, or a Substitute Security is accepted by the Fiscal Agent, or the requirement for the Security has been terminated pursuant to this section, the City or its designee, shall release all amounts in the Security account to the Security Provider (or its designee, which may be the Developer) within ten (10) calendar days from the date of renewal or acceptance. (c) Following the sale or transfer by the Account Party of any property to a person other than the Account Party, or upon the prepayment of the Special Tax obligation for a parcel owned Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 88
Menifee Mayor and City Council May 18, 2022
4 4863-2785-2828v3/200299-0009
by the Account Party, the Account Party shall notify the Community Facilities District of such event, in writing, and, if requested by the Account Party, the Stated Amount of the Security shall be reduced and be recalculated in accordance with this Section 2.2; provided, however, that any costs associated with the recalculation and reduction shall be borne by the Account Party. Subject to Section 2.2(d) below, the Stated Amount may be reduced to an amount equal to 200% of the product of the maximum annual debt service on the outstanding Bonds times a fraction the numerator of which is the aggregate Maximum Special Taxes applicable to the Sizing Property owned by the Account Party and the denominator of which is the total Maximum Special Taxes to all of the Sizing Property as of the date of calculation. The Security shall be terminated when the Account Party has paid all Special Taxes in the current fiscal year and the Sizing Property owned by the Account Party is expected to be responsible for less than 20% of the Maximum Special Taxes in the next fiscal year.
Reduction or termination of a Security shall occur automatically upon submission to the Security Provider by the Fiscal Agent of a “Certificate of Reduction or Termination” upon valuation of the Certificate of Reduction or Termination by the City. The City shall direct that the Fiscal Agent deliver to the Security Provider such Certificate of Reduction or Termination promptly upon receiving from the Account Party a certification which shall be made under penalty of perjury and which shall indicate (i) the legal description of all Sizing Property owned by the Account Party, and either (ii) a recalculation of the new Stated Amount that the Account Party proposes be applicable to the Security or (iii) if termination of the Security is requested, a statement that one of the requirements set forth in the preceding paragraph for termination of the Security has been satisfied.
The Account Party shall notify the City of any events that will result in a reduction of the Stated Amount of the Security and shall provide the City with verification of said events. The Account Party may provide the Fiscal Agent with a Substitute Security in the reduced amount, and the Fiscal Agent shall release and return to the Security Provider the Security then in effect. The Parties expressly acknowledge that the Account Party’s failure to so notify the City or to reduce the Security at the times prescribed herein shall in no way effect or invalidate sale or transfer of property, or recordation of maps on property.
(d) If the Sizing Property is sold or transferred by an Account Party with the result that the Sizing Property owned by the transferee or any of its affiliates (“Transferee”) is responsible for 20% or more of the aggregate Maximum Special Taxes of all Sizing Property, a Security on the same terms specified in Section 2.2(a) above will be furnished by Transferee with respect to all land owned by such Transferee with respect to the Sizing Property. Any applicable purchase and sale agreement and/or escrow instructions shall notify the Transferee of this Security requirement and obligate the Transferee to provide such Security, if applicable. The Security of the Account Party will not be reduced to reflect the sale or transfer of such Sizing Property until a Security is furnished by the Transferee and accepted by the Fiscal Agent. The issuing financial institution and the form and terms of said Security will be subject to reasonable prior approval by the City. All terms provided in this Section 2.2 are applicable to the Transferee by replacing the term “Account Party” at each place where it occurs in each section with the term “Transferee.” Each provider of a Security for a Transferee shall be an express third party beneficiary of the provisions of this Section 2.2.
Any costs related to the holding or maintaining the Security, including any fees of a fiscal agent, trustee or other depository shall be borne by the Account Party.
2.3 Major Landowner Initial and Continuing Disclosure. An owner of land which is responsible for twenty percent (20%) or more of the Maximum Special Taxes applicable to Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 89
Menifee Mayor and City Council May 18, 2022
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the Sizing Property in the fiscal year in which the Bonds are issued or in the fiscal year following the fiscal year in which the Bonds are issued (a “Major Landowner”) will be required to provide all information regarding the development of its property, including the financing plan for such development, which is necessary to ensure that the official statement for such Bonds complies with the requirements of Rule 15c2-12 of the Securities and Exchange Commission (the “Rule”) and all other applicable federal and state securities laws. Additionally, Developer acknowledges that, if it is a Major Landowner at the time of issuance of the Bonds, it will be necessary that Developer enter into a continuing disclosure agreement to provide such continuing disclosure pertaining to the development of the land owned by Developer within the CFD to assist in the marketing of the Bonds
2.4 Bond Issuance Parameters. The terms and conditions upon which each series of the Bonds shall be issued and sold, the method of sale of the Bonds and the pricing of the Bonds shall be determined solely by the City in its legislative discretion in conformance with the Act, the Policy, and this Agreement. Each series of Bonds shall be issued with a term not to exceed 35 years from the date of issuance of the Bonds. The proceeds of the Bonds shall be used in the following priority to (1) fund a reserve fund for the payment of principal and interest with respect to the Bonds in an amount equal to the least of (i) ten percent (10%) of the total bond issue, (ii) maximum annual debt service on Bonds, or (iii) 125% of average annual debt service; (2) fund capitalized interest through the interest payment date on the Bonds for which Special Taxes are not available for payment of debt service on the Bonds or such longer period as requested by the Developer and approved by the City, subject to the Act; (3) reimburse the Developer or its designee pursuant to Section 1 hereof for CFD formation costs advanced by the Developer pursuant to the Reimbursement Agreement which have not already been reimbursed to the Developer from collected Special Tax; (4) pay for costs of issuance of the Bonds including, without limitation, underwriter’s discount, bond counsel and disclosure counsel fees, appraisal and special tax consultant fees, printing, fiscal agent fees, and reasonable Developer legal and financial consultant costs; (5) pay for the costs of forming the Community Facilities District; and (6) pay for the actual costs of the Improvements. The Community Facilities District shall maintain records relating to the disbursements of proceeds of the sale of the Bonds. The Indenture or Resolution or Fiscal Agent Agreement (hereinafter “Indenture”) for the Bonds shall establish an acquisition and construction fund or improvement fund (herein, the “Improvement Fund”) to be held by the fiscal agent (“Fiscal Agent”) into which shall be deposited initially the proceeds of the Bonds net of the amount of proceeds required to fund items (1) through (5) in the second preceding sentence. The Indenture shall also establish separate accounts of the Improvement Fund designated the “City Improvements Account,” “City Fee Facility Improvements Account,” and any Miscellaneous Improvement Account(s) for the Miscellaneous Improvements described in Exhibit “C,” into which shall be deposited such portions of the Improvement Fund as agreed by the Parties and directed by the City in writing at or subsequent to the closing of the sale of the Bonds consistent with the following priorities:
(a) An amount sufficient to fund the reasonable, current estimated cost of the City Fee Facility Improvements anticipated to be funded out of the Bonds being issued shall be deposited in the City Fee Facility Improvements Account (any Special Taxes levied in the CFD and collected by the CFD remaining after the payment of administrative expenses of the CFD and the reimbursement of the Developer for CFD formation costs pursuant to Section 1 hereof shall be deposited into the City Fee Facility Improvements Account at the time of Bond issuance, unless otherwise directed in writing by the Developer);
(b) If applicable, an amount to be agreed upon between Developer and the CFD prior to the issuance of Bonds sufficient to fund the reasonable, current estimated costs of the City Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 90
Menifee Mayor and City Council May 18, 2022
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Improvements (including the Utility Undergrounding) shall be deposited, or later transferred, to the City Improvements Account; and
(c) If applicable, an amount to be agreed upon between Developer and the CFD prior to the issuance of Bonds sufficient to fund the reasonable, current estimated cost of the Miscellaneous Improvements described in Exhibit “C” hereto, anticipated to be funded out of the Bonds being issued shall be deposited, or later transferred, to the applicable Miscellaneous Improvement Account(s).
Interest earned on moneys deposited in each of the City Fee Facility Improvements Account, the City Improvements Account and the Miscellaneous Improvement Account(s) shall remain in such accounts until such time as all of the Improvements have been funded. Additionally, the Developer may direct the CFD to transfer excess moneys in any of the City Fee Facility Improvements Account, the City Improvements Account or the Miscellaneous Improvement Account(s) to another Account.
The Indenture shall provide that amounts remaining in the Improvement Fund after funding all proposed Improvements (such completion of funding to be agreed by the City and the Developer) shall be deposited in the special tax fund or bond service fund and be applied to pay debt service on the Bonds and/or to call Bonds in advance of maturity.
3. Allocation of Special Taxes. Prior to the issuance of Bonds, the City Council of the City, acting as the legislative body of the Community Facilities District, may levy Special Taxes on all parcels classified as Developed Property pursuant to the Rate and Method. Such Special Taxes collected by the City shall first be applied to fund annual administrative expenses of the Community Facilities District and then to fund Improvements in the same manner as the proceeds of Bonds as set forth herein. Upon sale and delivery of the Bonds, the City shall annually levy the Special Tax as provided for in documents pursuant to which the Bonds were issued. Following the issuance of the last series of Bonds, the City shall have no obligation to levy Special Taxes to reimburse the Developer for the costs of any Improvements not paid for from Bond proceeds.
4. Notice of Special Tax. Developer shall provide written notice to all potential initial purchasers of lots advising of the special tax obligation applicable to the Developer Property in the form required by Section 53341.5 of the Government Code.
5. Design Plans and Specifications. The requirements of this Section shall not apply to any City Improvement that was complete (as determined by the City Council) prior to the adoption by the City Council of the resolution forming the CFD, but they shall apply to all other City Improvements.
All plans, specifications and bid documents for the City Improvements (“Plans”) constructed or to be constructed by the Developer shall be prepared by the Developer at the Developer’s initial expense, subject to approval by the applicable public agency. Costs for preparation of the Plans will be eligible for reimbursement, conditioned upon the final approval of the applicable public agency and the availability of funds. Reimbursement of costs for plan revisions will be considered on a case by case basis. All facilities shall be bid in accordance with “public works” requirements of Section 7 to be eligible for reimbursement.
6. Construction of Improvements. The requirements of this Section shall not apply to any City Improvement that was complete (as determined by the City Council) prior to the adoption by the City Council of the resolution forming the CFD, but they shall apply to all other City Improvements.
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 91
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6.1 Acquisition of City Improvements. Upon the approval of Plans for a City Improvement, the Developer Developer will provide for construction of such City Improvement in accordance with Sections 6.2 and 7 of this Agreement. Sections 6.2 and 7 specify the requirements for construction of the City Improvements that the City believes are necessary to ensure that such City Improvements are constructed as if they had been constructed under the direction and supervision, or under the authority of the City.
6.2 Acquisition. With respect to City Improvements, a qualified engineering firm (the “Field Engineer”) shall be employed by the Developer to provide all field engineering surveys determined to be necessary by the City’s inspection personnel. Field Engineer shall promptly furnish to City a complete set of grade sheets listing all locations, offsets, etc., in accordance with good engineering practices, and attendant data and reports resulting from Field Engineer’s engineering surveys and/or proposed facility design changes. City shall have the right, but not the obligation, to review, evaluate and analyze whether such results comply with applicable specifications.
As necessary as determined by City, a full-time soil-testing firm, approved by City, shall be employed by the Developer to conduct soil compaction testing and certification. The Developer shall promptly furnish results of all such compaction testing to the City for its review, evaluation and decision as to compliance with applicable specifications. In the event the compaction is not in compliance with applicable specifications, the Developer shall be fully liable and responsible for the costs of achieving compliance. A final report certifying all required compaction in accordance with the specifications shall be a condition of final approval of facilities.
The costs of all surveying, testing and reports associated with the City Improvements furnished and constructed by the Developer’s contractor(s) shall be eligible to be paid from funds in the City Improvements Account.
The City shall not be responsible for conducting any environmental, archaeological, biological, or cultural studies or any mitigation requirements that may be requested by appropriate Federal, State, and/or local agencies. Any such work shall be paid for and conducted by the Developer and reimbursed out of the City Improvements Account.
Should the Developer notify the City that the Developer is unable to complete such City Improvement, the City shall have the right but not the obligation to require the Developer to make an irrevocable offer of dedication to the City of the land owned by the Developer for the City Improvement identified in the notice and to assume responsibility for the work to be performed thereunder. In the event the City elects to assume the responsibility for any work on a previously awarded contract as described in the preceding sentence, the following will occur: (i) the Developer will make an irrevocable offer of dedication to the City of the land owned by the Developer for such City Improvement identified in the notice; (ii) to the extent permitted by law and the applicable contract, the Developer will assign all of the contracts for the work performed to date on the City Improvement identified in the notice to the City, if requested to do so by the City Manager; the City will use its best efforts to complete the City Improvement within a reasonable time frame; and upon completion of the City Improvement, to the extent there are Special Taxes or proceeds of the Bonds available following payment to the City for the costs of completing such City Improvement, the Developer will be reimbursed for the lesser of the cost or value of the previously unreimbursed satisfactory work performed or paid for by the Developer. The cost of such work will be determined by taking the unreimbursed amounts expended by the Developer under the contract(s) taken over by the City and deducting any incremental cost incurred by the City to complete the work under the contracts in Item Title: 11.1
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question. Incremental cost shall be costs in excess of the sum of the original contract cost plus change orders approved by the City.
7. Public Works Requirements.
7.1 City Requirements. In order that the City Improvements may be properly and readily acquired by the City, the Developer shall comply with all of the requirements in this Section
7.1 with respect to any such City Improvements to be acquired with funds in the City Improvements Account and the Developer shall provide such proof to the City as the City may reasonably require and at such intervals and in such form as the City may reasonably require, that the requirements under this Section 7.1 have been satisfied as to all such City Improvements. Notwithstanding the foregoing, City Improvements shall only be eligible for financing by the CFD if the City determines that the conditions under Section 53313.5 have been satisfied with respect to such City Improvements. (a) The Developer shall prepare a bid package for review, comment and approval by the City Manager or his designee (the “City Representative”) for any City Improvements bid after the effective date of this Agreement.
(b) For any City Improvements bid after the effective date of this Agreement, the Developer shall, after obtaining sealed bids for the construction of the City Improvements in conformance with the procedures and requirements of the City, submit to the City written evidence of such competitive bidding procedure, including evidence of the means by which bids were solicited, a listing of all responsive bids and their amounts, and the name or names of the contractor or contractors to whom the Developer proposes to award the contracts for such construction, which shall be the lowest responsible bidder.
(c) For any City Improvements bid after the effective date of this Agreement, the following provisions apply: the City Representative shall attend the bid opening for such City Improvements. If unable to attend the bid opening, the City Representative shall approve or disapprove of a contractor or contractors, in writing, within five (5) business days after receipt from the Developer of the name or names of such contractor or contractors recommended by the Developer. If the City Representative disapproves of any such contractor, the Developer shall select the next lowest responsible bidder from the competitive bids received who is acceptable to the City Representative. (d) The specifications and bid and contract documents shall require all such contractors to pay prevailing wages and to otherwise comply with applicable provisions of the Labor Code, the Government Code and the Public Contract Code relating to public works projects and as required by the procedures and standards of the City with respect to the construction of its public works projects.
(e) The Developer shall submit faithful performance and payment bonds in form and substance reasonably acceptable to the City with respect to the City Improvements. (f) The Developer and its contractor and subcontractors shall be required to provide proof of insurance coverage throughout the term of the construction of the City Improvements, which they will construct in conformance with the City’s standard procedures and requirements. The City’s insurance requirements are set out in Section 20 herein.
Item Title: 11.1
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(g) The Developer and all such contractors shall comply with such other requirements relating to the construction of the City Improvements which the City may impose by written notification delivered to the Developer and each such contractor at the time either prior to the receipt of bids by the Developer for the construction of such City Improvements or, to the extent required as a result of changes in applicable laws, during the progress of construction thereof; provided that such other requirements shall only be imposed to the extent the City reasonably determines they are required in order to comply with applicable law. In accordance with Section 7, the Developer shall be deemed the awarding body and shall be solely responsible for compliance and enforcement of the provisions of the Labor Code, Government Code, and Public Contract Code. (h) A “Change Order” is an order from the Developer to a contractor authorizing a change in the work to be performed and a “Significant Change Order” is an order from the Developer to a contractor authorizing a change in the work to be performed where such Change Order is larger than 10% of the contract amount for such City Improvement. After the effective date of this Agreement, the Developer shall receive comments from the City Representative prior to the Developer’s approval of any Significant Change Order. The City Representative shall comment on or deny the Significant Change Order request within fifteen (15) business days of receipt of all necessary information. The City’s comments to a Significant Change Order shall not be unreasonably delayed, conditioned or withheld. The Developer shall not be entitled to be compensated for costs associated with a Significant Change Order that has not been approved by the City Representative.
Developer shall provide proof to the City, at such intervals and in such form as the City may reasonably require, that the foregoing requirements have been satisfied as to all of the City Improvements which are funded through Bond proceeds.
8. Inspection; Completion of Construction. The requirements of this Section shall not apply to any City Improvement that was complete (as determined by the City Council) prior to the adoption by the City Council of the resolution forming the CFD, but they shall apply to all other City Improvements.
The City shall have primary responsibility for inspecting the City Improvements to assure that the work is being accomplished in accordance with the Plans. Such inspection does not include inspection for compliance with safety requirements by the Developer’s contractor(s). The City’s personnel shall be granted access to each construction site at all reasonable times for the purpose of accomplishing such inspection. Upon satisfaction of the City’s inspectors, the Developer shall notify the City in writing that a City Improvement has been completed in accordance with the Plans. Any actual costs reasonably incurred by the City for inspection not previously paid by the Developer shall be reimbursed from funds in the City Improvements Account.
Within three (3) business days of receipt of written notification from City inspectors that a City Improvement has been completed in accordance with the Plans, the City Representative shall notify the Developer in writing that such City Improvement has been satisfactorily completed. Upon receiving such notification, the Developer shall file a Notice of Completion with the County of Riverside Recorders Office, pursuant to the provisions of Section 3093 of the Civil Code. The Developer shall furnish to the City a duplicate copy of each such Notice of Completion showing thereon the date of filing with the County of Riverside (the “County”). City will in turn file a notice with the County for acceptance.
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 94
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9. Liens. With respect to any City Improvement that was complete (as determined by the City Council) prior to the adoption by the City Council of the resolution forming the CFD, prior to any payment by the CFD to the Developer for such City Improvement, the Developer shall provide to the City such evidence or proof as the City shall require that all persons, firms and corporations supplying work, labor, materials, supplies and equipment for the construction of the City Improvements have been paid, and that no claims of liens have been recorded by or on behalf of any such person, firm or corporation. With respect to City Improvements, upon the earlier of (i) receipt of all applicable lien releases, or (ii) expiration of the time for the recording of claim of liens as prescribed by Sections 3115 and 3116 of the Civil Code the Developer shall provide to the City such evidence or proof as the City shall require that all persons, firms and corporations supplying work, labor, materials, supplies and equipment for the construction of the City Improvements have been paid, and that no claims of liens have been recorded by or on behalf of any such person, firm or corporation.
10. Acquisition; Acquisition Price; Source of Funds. The acquisition price of a City Improvement that was complete (as determined by the City Council) prior to the adoption by the City Council of the resolution forming the CFD shall be its fair market value, as determined by the City’s Assistant General Manager or his or her designee, as of the date of acquisition. The City shall consider input and data provided by the Developer prior to determining the final fair market value. The Actual Cost (as defined below) of the City Improvement shall be presumed to be its fair market value unless there is reasonable evidence that a lower amount is the fair market value.
The costs eligible to be included in the acquisition price of a City Improvement that is not described in the preceding paragraph (the “Actual Costs”) shall include:
(i) The actual hard costs for the construction of such City Improvement as established by the City-approved construction contracts, Change Orders, and approved Significant Change Orders, including costs of payment, performance and maintenance bonds and insurance costs, pursuant to this Agreement;
(ii) The design and engineering costs of such City Improvement including, without limitation, the costs incurred in preparing the Plans; (iii) The costs of environmental evaluations and public agency permits and approvals attributable to the City Improvement;
(iv) Costs incurred by the Developer for construction management and supervision of such City Improvement, not to exceed five percent (5%) of the actual construction cost; (v) Professional costs associated with the City Improvement such as engineering, inspection, construction staking, materials, testing and similar professional services; and (vi) Costs approved by the City in accordance with the Act of acquiring any real property or interests therein required for the City Improvement including, without limitation, temporary construction easements, temporary by-pass road and maintenance easements.
Provided the Developer has complied with the requirements of this Agreement, the City agrees to pay the acquisition price of a completed City Improvement to the Developer or its designee within thirty (30) days after the Developer’s satisfaction of the preconditions to such payment stated herein, but only to the extent there are sufficient funds available in the City Improvements Account. Except Item Title: 11.1
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in the case of a City Improvement described in the first paragraph of this Section, the acquisition price to be paid from Bond proceeds for the acquisition of a City Improvement by the City shall be the least of (1) the value of the City Improvement; or (2) the total of the Actual Costs of the City Improvement (“Acquisition Price”). The Actual Cost of the City Improvement shall be presumed to be its Acquisition Price unless there is reasonable evidence that a lower amount is the actual value.
As a condition to the payment of the Acquisition Price, the ownership of the completed City Improvement shall be transferred to the City by grant deed, bill of sale or such other documentation as such public agency may require free and clear of all taxes, liens, encumbrances, and assessments, but subject to any exceptions determined by the City to not interfere with the actual or intended use of the land or interest therein (including the lien of a community facilities district so long as the subject property is exempt from taxation or is otherwise not taxable by such community facilities district).
Upon the transfer of ownership of City Improvements or any portion thereof to the City, the City shall be responsible for the maintenance of such City Improvements or the portion transferred.
Notwithstanding the foregoing, the Acquisition Price of a City Improvement may be paid prior to transfer of ownership and acceptance of the City Improvement if it is substantially completed at the time of payment. The City Improvement shall be considered “substantially complete” when it has been reasonably determined by the City to be usable, subject to final completion of such items as the final lift or any other items not essential to the primary use or operation of the City Improvement.
For purposes of determining the Acquisition Price to be paid by the Community Facilities District for the acquisition of the City Improvements by the City (other than City Improvements described in the first paragraph of this Section), the value of such City Improvements shall include the construction costs specified in the City-approved contracts (subject to the next sentence), Change Orders, and City-approved Significant Change Orders conforming to Section 6, as hereinbefore specified. City approval is a condition prior to initiation of contract work for City Improvements bid after the effective date of this Agreement. However, if the City reasonably determines that the additional Actual Costs are excessive and that the value of the City Improvements is less than the total amount of such Actual Costs and such construction costs, the price to be paid for the acquisition of the City Improvements shall be the value thereof as determined by the Engineer, subject, however, to the Developer’s right to appeal to the City Council.
Upon completion of the construction of a City Improvement, the Developer shall deliver or cause to be delivered to the City a Disbursement Request Form in substantially the form of Exhibit “D,” attached hereto, copies of the contract(s) with the contractor(s) who have constructed the City Improvement and other relevant documentation with regard to the payments made to such contractor(s) and each of them for the construction of the City Improvement, documentation evidencing payment of prevailing wages, and shall also provide to the City invoices and purchase orders with respect to all equipment, materials and labor purchased for the construction of the City Improvements. The City shall require the Engineer to complete its determination of the value of the City Improvements as promptly as is reasonably possible.
Notwithstanding the preceding provisions of this Section, the source of funds for the acquisition of the City Improvements or any portion thereof shall be funds in the City Improvements Account. If for any reason beyond the City’s control the Bonds are not sold, the City shall not be required to acquire the City Improvements from the Developer, except to the extent of funds from the collection of Special Taxes. In such event, the Developer shall complete the design and construction and offer to the City ownership of such portions of the City Improvements as are required to be constructed by the Developer as a condition to recordation of subdivision maps for the Developer Item Title: 11.1
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Property (but only at such times as required by such condition), but need not construct any portion of the City Improvements which it is not so required to construct. Reimbursement for these facilities would be made from the collection of Special Taxes over time.
In addition to the foregoing, the City shall have the right to withhold payment for acquisition of a City Improvement, if:
(a) the Developer or any of its affiliates is delinquent in the payment of any Special Taxes levied by the Community Facilities District on properties then owned by the Developer or any of its affiliates within the CFD, or
(b) the Developer is not then in substantial compliance with a condition or obligation imposed upon the Developer Property by the City, including but not limited to, payment of all applicable fees, dedication of all applicable rights-of-way or other property and construction requirements.
The City shall immediately provide written notice to the Developer of the decision to withhold any such payment and shall specify the reason for such decision. If the payment is withheld as a result of the delinquency in the payment of Special Taxes, the notice shall identify the delinquent parcels and the amount of such delinquency. If the payment is withheld as a result of substantial non-compliance with a condition or obligation, the notice shall specify such condition or obligation and what action will be necessary by the Developer to substantially comply with such condition or obligation. Upon receipt of evidence reasonably satisfactory to the City that the Developer has paid the delinquent Special Taxes or complied with the subject condition or obligation, the City shall forthwith make all payments which have been withheld pursuant to the provisions of this Section.
11. Easements and/or Fee Title Ownership Deeds. Without limiting the Developer’s rights to reimbursement for such grants pursuant to Section 10 above, the Developer shall, at the time the City acquires the City Improvements as provided in Section 10 hereof, grant or cause to be granted to the City, by appropriate instruments prescribed by the City, all easements across private property and/or fee title ownership deeds which may be reasonably necessary for the proper operation and maintenance of such City Improvements, or any part thereof, but only to the extent located within the Developer Property.
12. Permits. The Developer shall be responsible for obtaining all necessary construction permits from the City and/or the County (as appropriate) covering construction and installation of the City Improvement.
13. Maintenance. Prior to the transfer of ownership of a City Improvement by the Developer to the City, as provided in Section 10 hereof, the Developer shall be responsible for the maintenance thereof and shall require its contractor(s) to repair all facilities damaged by any party other than the City, prior to acceptance by the City and/or make corrections determined to be necessary by the City’s inspection personnel. The City shall not be permitted to place any City Improvement in service prior to acceptance of the same, unless the Developer otherwise consents in writing.
14. Inspection of Records. The City shall have the right to review all books and records of the Developer pertaining to the costs and expenses incurred by the Developer for the design and construction of the City Improvements during normal business hours by making arrangements with the Developer. The Developer shall have the right to review all books and records of the City pertaining Item Title: 11.1
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to costs and expenses incurred by the City for services of the Engineer by making arrangements with the City.
15. Ownership of Improvements. Notwithstanding the fact that some or all of the City Improvements may be constructed in dedicated street rights-of-way or on property which has been or will be dedicated to the City, each City Improvement shall be and remain the property of the Developer until acquired by the City as provided in this Agreement. The foregoing shall not apply to the Utility Undergrounding.
16. Materials and Workmanship Warranty. The requirements of this Section shall not apply to any City Improvement that was complete (as determined by the City Council) prior to the adoption by the City Council of the resolution forming the CFD, but they shall apply to all other City Improvements.
Upon the completion of the acquisition of a City Improvement by the City, the performance bond related to such individual City Improvement provided by the Developer pursuant to Section 7.1(e) hereof, shall be reduced by 90%, and the remaining 10% shall serve as a maintenance bond to guarantee that such City Improvement will be free from defects due to faulty workmanship or materials for a period of one year.
17. City Fee Facility Improvements. The Developer may be required pursuant to the conditions of development or the fee ordinance to pay certain City fees (the “City Fees”) relating to the City Fee Facility Improvements prior to the availability of proceeds of the Bonds to pay for such City Fee Facility Improvements. In the event such City Fees are paid prior to the availability of Bond proceeds, the amounts paid to the City shall be deemed to be deposits (each a “Deposit”) that are subject to refund by the City to the Developer in accordance with this Agreement. The City shall place each Deposit in a capital facilities account(s). If the Developer has made any Deposits to the City, then following deposit of Bond proceeds in the City Fee Facility Improvements Account, the City shall return to the Developer, from the capital account in which the Deposits were deposited the Deposits not previously returned, without interest or other earnings thereon. The City shall be so obligated to return such Deposits only to the extent that an equivalent amount of the Deposits to be returned is deposited in the City Fee Facility Improvements Account from Bond proceeds or Special Tax collections prior to the issuance of Bonds.
Bond proceeds used to finance City Fee Facility Improvements which relate to the City Fees shall be allocated first for return of all Deposits prior to being allocated to the payment of City Fees not previously deposited by the Developer. Any Deposits that have not been returned to the Developer at the time it is determined that there will be no further Bond proceeds available (i.e. the final series of Bonds to finance the Improvements have been issued) shall be retained by the City and may be used for the purposes for which the City Fee was required, and the unrefunded Deposits shall constitute full and final payment for such City Fees, without any increase of any kind.
18. Miscellaneous Improvements. Improvements unrelated to the City Improvements and the City Fee Facility Improvements are described in Exhibit “C” attached hereto. The amounts deposited in the applicable Miscellaneous Improvement Account(s), if any, will be disbursed for the acquisition or construction of Miscellaneous Improvements in accordance with the provisions in the applicable Joint Community Facilities Agreement. Any amounts in the applicable Miscellaneous Improvement Account(s) shall be disbursed at the written direction of the City upon Developer’s submittal of a payment request which will be based upon applicable entity’s payment request form as Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 98
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provided for in the applicable Joint Community Facilities Agreement. Upon receipt of such payment request, the City shall submit a written requisition for payment of the requested amount to the Fiscal Agent for the Bonds, who shall directly pay the amount requested to the applicable entity.
19. Independent Contractor. In performing this Agreement, Developer is an independent contractor and not the agent of the City. The City shall not have any responsibility for payment to any contractor or supplier of Developer. It is not intended by the Parties that this Agreement create a partnership or joint venture among them and this Agreement shall not otherwise be construed.
20. Indemnification. Developer shall assume the defense of, indemnify and save harmless, the City, its officers, employees and agents, and the Community Facilities District, its officers, employees and agents, from and against all actions, damages, claims, losses or expenses of every type and description to which they may be subject or put, by reason of, or resulting from such person’s or entity’s performance of its obligations under this Agreement and the construction of the City Improvements and the Miscellaneous Improvements, the failure of the Developer to provide notice of the Special Tax to be levied by the Community Facilities District pursuant to Section 53341.5 of the Act (but only if the Developer is required by law to provide such notice), or arising out of any alleged misstatements of fact or alleged omission of a material fact made by the Developer, its officers, directors, employees or agents to the City, the Community Facilities District, the underwriter of the Bonds and its counsel, the appraiser, the special tax consultant, the market absorption consultant or bond counsel regarding the Developer, its proposed developments, its property ownership, and any contractual arrangement it may enter into in a disclosure document describing the Community Facilities District and the risks relating to the Bonds. No provision of this Agreement shall in any way limit the extent of Developer’s responsibility for payment of damages resulting from the operations of Developer and its contractors; provided, however that Developer shall not be required to assume the defense or indemnify and save harmless any person or entity as to actions, damages, claims, losses or expenses resulting from the breach of this Agreement, the willful misconduct of such person or entity or their officers, agents, consultants or employees.
21. Insurance Requirements. For City Improvements bid after the effective date of this Agreement, neither the Developer nor its contractor shall commence work on such City Improvement under this Agreement prior to obtaining insurance with a company or companies acceptable to the City, nor shall the Developer’s contractor allow any subcontractor to commence work on its subcontract until all insurance required of the subcontractor has been obtained.
The Developer shall during the life of this Agreement, notify the City in writing of any incident giving rise to any potential bodily injury or property damage claim and any resultant settlements, whether in conjunction with this or any other project which may affect the limits of the required coverage, as soon as is reasonable and practical.
22. Conflict With Other Agreements. Except as specifically provided herein, nothing contained herein shall be construed as releasing Developer from any condition of development or requirement imposed by any other agreement with City. In the event of a conflicting provision, such other agreement shall prevail unless such conflicting provision is specifically waived or modified in writing by City.
23. Notices. Any notice, payment or instrument required or permitted by this Agreement to be given or delivered to either Party shall be deemed to have been received when personally delivered or seventy-two (72) hours following deposit of the same in any United States Post Office in Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 99
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California, registered or certified, postage prepaid. Any notice to the Community Facilities District or the City shall be addressed to City of Menifee, 29844 Haun Road, Menifee, CA 92530, Attention:
Assistant City Manager. Any notice to Developer shall be addressed to Lennar Homes of California, LLC, 980 Montecito Drive Ste 206, Corona, CA 92879, Attention: Geoff Smith.
Each Party may change its address for delivery of notice by delivering written notice of such change of address to the other Party hereto.
24. No Gift or Waiver.
24.1 No Gift or Waiver for City Improvements. The Developer and the City acknowledge that:
(a) The Developer or its predecessor may have constructed or may be constructing City Improvements before funds that will be used to acquire them are available with the expectation that the Developer will be reimbursed for such City Improvements to the extent and in the manner set forth in this Agreement.
(b) The City may inspect City Improvements and process Disbursement Request Forms even if funds from the proceeds of Bonds available at the time of such inspection and processing do not exist or are not then sufficient to satisfy the Disbursement Request in full. (c) The Developer may convey City Improvements to the City and the City may accept such City Improvements even if funds from the proceeds of Bonds available at the time of such conveyance and acceptance do not exist or are not then sufficient to satisfy the Disbursement Request in full.
(d) If the City accepts City Improvements before a Disbursement Request is paid in full, the unpaid balance of the Disbursement Request will be paid from time to time, in any number of installments and irrespective of the length of time payment is deferred, as funds from the proceeds of Bonds become available.
(e) The Developer’s conveyance or dedication of City Improvements to the City before the availability of funds from the proceeds of Bonds to acquire the City Improvements is not and shall not be deemed, a gift or a waiver of the Developer’s right to payment of the purchase price of such City Improvements pursuant to this Agreement.
24.2 No Gift or Waiver for City Fees. The Developer and the City acknowledge that:
(a) Prior to the availability of funds from the proceeds of Bonds, the Developer or its predecessor may have been or may be required to deposit funds to assure payment of applicable City Fees of the City.
(b) The Developer or its predecessor has deposited or will be depositing such funds with the expectation that the Developer will be reimbursed for these Deposits to the extent and in the manner set forth in this Agreement.
Item Title: 11.1
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(c) The reimbursement of such Deposits pursuant to Section 16 of this Agreement may occur from time to time, in any number of installments and irrespective of the length of time payment is deferred, as funds become available.
(d) The Developer’s deposit of such funds to the City before the availability of funds to reimburse the Developer is not, and shall not be deemed, a gift or a waiver of the Developer’s right to reimbursement of such Deposits pursuant to this Agreement.
25. General Provisions.
(a) Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the City and the Developer and their respective heirs, executors, legal representatives, successors, and authorized assigns.
(b) Amendment. This Agreement may be amended at any time but only in writing signed by each Party hereto.
(c) Entire Agreement. This Agreement, and the agreements referenced herein, contains the entire understanding and agreement between the Parties with respect to the matters provided for herein and supersedes all prior agreements and negotiations between the Parties with respect to the subject matter of this Agreement. There are no oral or written representations, understanding, undertakings or agreements which are not contained or expressly referred to herein, and any such representations, understandings or agreements are superseded by this Agreement. Failure by a Party to insist upon the strict performance of any of the provisions of this Agreement by the other Parties hereto, or the failure by a Party to exercise its rights upon the default of another Party, shall not constitute a waiver of such Party’s right to insist and demand strict compliance by such other Parties with the terms of this Agreement thereafter. This Agreement shall be binding upon, and enforceable by and against the Community Facilities District upon the establishment of the Community Facilities District.
(d) Exhibits. All exhibits attached hereto are incorporated into this Agreement by reference.
(e) Severability. If any part of this Agreement is held to be illegal or unenforceable by a court of competent jurisdiction, the remainder of this Agreement shall be given effect to the fullest extent reasonably possible.
(f) Waiver. Failure by a Party to insist upon the strict performance of any of the provisions of this Agreement by the other Parties hereto, or the failure by a Party to exercise its rights upon the default of another Party, shall not constitute a waiver of such Party’s right to insist and demand strict compliance by such other Parties with the terms of this Agreement thereafter. (g) No Third Party Beneficiaries. Except as provided explicitly in this Agreement, no person or entity shall be deemed to be a third party beneficiary hereof, and nothing in this Agreement (either express or implied) is intended to confer upon any person or entity, other than the City, the Community Facilities District, the Developer, and the Security Provider (and their respective successors and assigns), any rights, remedies, obligations or liabilities under or by reason of this Agreement.
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 101
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(h) Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which shall constitute but one instrument. (i) Assignment. Developer may assign all or any of its rights pursuant to this Agreement to a purchaser of all or any portion of the Developer Property. Such a purchaser and assignee shall, as a condition to taking an assignment of such rights, enter into an assignment and assumption agreement with the City and Developer, in a form reasonably acceptable to Developer and the City, whereby such rights assigned are specified and such purchaser agrees, except as may be otherwise specifically provided therein, to assume the obligations of Developer pursuant to this Agreement and to be bound thereby. A company that acquires all of the assets of the Developer, including ownership of the Developer itself, shall be deemed a successor and shall not require an assignment or assumption agreement to be bound by, and enjoy the benefits of, this Agreement. (j) Governing Law. This Agreement and any dispute arising hereunder shall be governed by and interpreted in accordance with the laws of the State of California. (k) Construction of Agreement. This Agreement has been reviewed by legal counsel for both the City and Developer and shall be deemed for all purposes to have been jointly drafted by the City and Developer. No presumption or rule that ambiguities shall be construed against the drafting Party shall apply to the interpretation or enforcement of this Agreement. (l) Termination. The provisions of this Agreement related to the acquisition and financing of the Improvements shall terminate and be of no further force or effect if the first series of Bonds for the CFD are not sold within ten years from the date of this Agreement unless extended by agreement of all the Parties. If the City is unable to sell the first series of Bonds for the CFD after diligent, commercially reasonable efforts to do so, this Agreement shall terminate and be of no further force and effect; provided, however, in such event, any collected Special Taxes remaining after the payment of administrative expenses of the CFD and reimbursement to the Developer of CFD formation costs shall be used to pay for Improvements in accordance with this Agreement and Developer shall receive a credit against City Fees otherwise payable to City in the amount so used to pay for City Fee Facility Improvements.
(m) Attorneys’ Fees. In the event of any action or proceeding, including an arbitration or a reference pursuant to Section 638 et seq., of the Code of Civil Procedure brought by any Party against any other under this Agreement, the prevailing Party shall be entitled to recover its actual attorneys’ fees and all fees, costs and expenses incurred for prosecution, defense, consultation, or advice in such action or proceeding. In addition to the foregoing, the prevailing Party shall be entitled to its actual attorneys’ fees and all fees, costs and expenses incurred in any post-judgment proceedings to collect or enforce the judgment. This provision is separate and several and shall survive the merger of this Agreement into any judgment on this Agreement. (n) Venue and Forum. Any action at law or in equity arising under this Agreement brought by any Party hereto for the purpose of enforcing, construing or determining the validity of any provision of this Agreement shall be filed and tried in the Superior Court of the County of Riverside, State of California, and the Parties waive all provisions of law providing for the filing removal or change of venue to any other Court.
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 102
Menifee Mayor and City Council May 18, 2022
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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day and year written below.
DATED: __________________, 2022
CITY OF MENIFEE, a political subdivision of
the State of California
By:
Armando G. Villa, City Manager
ATTEST:
By:
Sarah Manwaring, City Clerk
APPROVED AS TO FORM:
CITY ATTORNEY FOR THE CITY OF
MENIFEE
By:
Jeffrey T. Melching, City Attorney
LENNAR HOMES OF CALIFORNIA, LLC,
A California limited liability company
By:
Name:
Title:
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 103
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LIST OF EXHIBITS
EXHIBIT A - DESCRIPTION OF DEVELOPER PROPERTY
EXHIBIT B - DESCRIPTION OF COST ESTIMATES
EXHIBIT C - MISCELLANEOUS IMPROVEMENTS
EXHIBIT D - DISBURSEMENT REQUEST FORM
Item Title: 11.1
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EXHIBIT A
DESCRIPTION OF DEVELOPER PROPERTY
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Item Title: 11.1
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Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 108
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Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 109
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EXHIBIT B
DESCRIPTION OF COST ESTIMATES OF THE IMPROVEMENTS (1)
I. CITY FEE FACILITY IMPROVEMENTS.
Estimated Cost of the City Fee Facility Improvements
Description Estimated Cost
Law Enforcement $ 87,549
Fire Facilities 232,706
Circulation 1,769,930
General Government 386,959
Public Use Facilities 58,366
Parks – Land Acquisition 81,485
Parks – Improvements 250,519
City Projects 573,503
Total City Fees Facility Improvements $ 3,441,017
II. CITY IMPROVEMENTS.
Those facilities constructed by or on behalf of the Developer and needed by City in order to provide services to the Developer Property, including the following:
Estimated Cost of the City Improvements
Description Estimated Cost
Traffic Signals (Holland & Evans)(2) $ 643,905
Street & Traffic Signals (Murrieta & La Piedra (i.e. Mountain View)) 871,002 Traffic Signal Land Acq. (Murrieta & La Piedra / Evans & Holland) 138,474 Traffic Signals (Evans & La Piedra)(2) 76,161
Utility Undergrounding ‐ Rule 20(2) 761,608
Park Improvements(2) 3,800,000
Total City Improvements $6,291,150
(1) Amounts are estimates and subject to change. The Acquisition Price will be funded with Bond proceeds. (2) Bids for these City Improvements were received prior to the effective date of the Acquisition, Construction and Funding Agreement, however, such City Improvements shall only be eligible for financing by the CFD if the City determines that the conditions under Section 53313.5 have been satisfied with respect to such City Improvements.
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 110
Menifee Mayor and City Council May 18, 2022
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EXHIBIT C
DESCRIPTION OF THE MISCELLANEOUS IMPROVEMENT
Water District facilities included in the Water District’s capacity and connection fee programs used to finance expansion projects, exclusive of in-tract facilities constructed by a property owner, but including and not limited to the following:
Description Estimated Cost
Sewer Financial Participation Charge $ 1,215,832
Sewer Treatment Plant Capacity Charge 2,594,255
Water Financial Participation Charge 2,304,699
Water Supply Development Fee 140,988
Meter Fees 142,883
Total Estimated Water District Facilities Fees $ 6,398,657 Those facilities constructed by or on behalf of the Developer and needed by the Water District in order to provide services to the Developer Property and also include any of the following:
Estimated Cost of the Water District Improvements
Description Estimated Cost
TBD TBD
Menifee School District Improvements included in the Menifee School District’s development fee programs used to finance Menifee School District Improvements, in approximately the following amount:
Estimated Cost of the Menifee School District Improvements Description Estimated Cost
Menifee Union School District Fees $3,594,144
Perris School District Improvements included in the Perris School District’s development fee programs used to finance Perris School District Improvements, in approximately the following amount:
Estimated Cost of the Perris School District Improvements Description Estimated Cost
Perris Union High School District Fees TBD
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 111
Menifee Mayor and City Council May 18, 2022
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EXHIBIT D
CFD NO. 2022-1 (QUARTZ RANCH) OF THE CITY OF MENIFEE
DISBURSEMENT REQUEST FORM
1. Community Facilities District No. 2022-1 (Quartz Ranch) of City of Menifee (the “CFD”) is hereby requested to pay from the ________________________ Account, or any applicable account or sub-account thereof, established by the CFD in connection with its 20__ Special Tax Bonds (the “Bonds”) to City of Menifee (the “City”) as payee, the sum set forth below:
$_____________________ (the Requested Amount”)
2. The Requested Amount represents the payment of City Fees for ___ lot(s) within the boundaries of the CFD (the “Property”).
(Tract No. __________, Lot Nos. ________________).
Or, City Improvements as supported by attached documentation.
3. The Requested Amount is due and payable, has not formed the basis of any prior request or disbursement.
4. The City, as payee, is hereby directing payment of the Requested Amount be payable to Lennar Homes of California, LLC, a California limited liability company (the “Developer”), pursuant to the wiring instructions attached hereto.
5. The Requested Amount is authorized and payable pursuant to the terms of the certain Acquisition, Construction and Funding Agreement (the “Agreement”) between the City of Menifee, acting for and on behalf of itself and the CFD and Developer.
6. Capitalized undefined terms used herein shall have the meaning ascribed to them in the Agreement.
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 112
Menifee Mayor and City Council May 18, 2022
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Dated: DEVELOPER:
LENNAR HOMES OF CALIFORNIA, LLC,
a California limited liability company
By:
Name:
Title:
Dated: CITY OF MENIFEE
By:
Its:
[ATTACH WIRING INSTRUCTIONS]
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 113
Menifee Mayor and City Council May 18, 2022
4867-4705-4356v2/200299-0009
JOINT COMMUNITY FACILITIES AGREEMENT
relating to
Community Facilities District No. 2022-1 (Quartz Ranch) of the City of Menifee by and among
City of Menifee, Eastern Municipal Water District and
Lennar Homes of California, LLC
THIS JOINT COMMUNITY FACILITIES AGREEMENT (the “Agreement”) is entered into effective as of the _____ day of _____, 2022, by and among CITY OF MENIFEE, a California general law city (the “City”), EASTERN MUNICIPAL WATER DISTRICT, a public agency organized and existing pursuant to Division 20 of the California Water Code (“EMWD”), and LENNAR HOMES OF CALIFORNIA, LLC, a California limited liability company (“Property Owner”), and relates to the formation by the City of a community facilities district known as “Community Facilities District No. 2022-1 (Quartz Ranch) of the City of Menifee” (the “CFD”) for the purpose of financing certain facilities to be owned, operated or maintained by the City or EMWD from proceeds of bonds issued by the CFD and the proceeds of special taxes levied by the CFD.
R E C I T A L S:
A. The property (“Property”) depicted in Exhibit “A” hereto, which is located in the City, County of Riverside, State of California, constitutes the land within the boundaries of the CFD.
B. Property Owner owns the Property included in the CFD. Property Owner intends to develop the Property for residential purposes. The Property is described in Exhibit “B” hereto.
C. The City received a petition in accordance with the Act (defined below) to form the CFD for the purpose of financing, among other things, certain public facilities to be constructed and owned and operated by EMWD (the “EMWD Facilities”) in lieu of the payment of EMWD Fees (defined herein) and certain water and sewer facilities to be constructed by Property Owner and acquired by EMWD (the “Acquisition Facilities”).
D. In conjunction with the issuance of permits for the construction of homes on the Property and/or receipt of water meters for such homes, the Property Owner, or its successors or assigns, may elect to advance EMWD Facilities costs in lieu of payment of EMWD Fees (the “Advances”) before Bond Proceeds (defined herein) are available in sufficient amounts to pay for EMWD Facilities. In such case, the Property Owner shall be entitled to (i) reimbursement of such Advances limited to Bond Proceeds available to EMWD, if any (the Advances being considered an interest free loan by the Property Owner with no repayment obligation except to the extent there are Bond Proceeds received by or made available to EMWD as described herein, all as further described in Section 5(a) below), and (ii) credit against EMWD Fees which would otherwise be due to EMWD equal to the amount of Bond Proceeds disbursed to EMWD or at the direction of EMWD for EMWD Facilities, all as further described herein.
E. The City will have sole discretion and responsibility for the formation and administration of the CFD.
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 114
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F. The City is authorized by Section 53313.5 of the Act to assist in the financing of the acquisition and/or construction of the EMWD Facilities and/or the Acquisition Facilities. This Agreement constitutes a joint community facilities agreement, within the meaning of Section 53316.2 of the Act, by and among EMWD, the Property Owner and the City, pursuant to which the CFD, when and if formed, will be authorized to finance the acquisition and/or construction of all or a portion of the EMWD Facilities and/or the Acquisition Facilities. As authorized by Section 53316.6 of the Act, responsibility for constructing, providing for and operating the EMWD Facilities and/or the Acquisition Facilities is delegated to EMWD.
G. The Parties (defined below) hereto find and determine that the residents residing within the boundaries of EMWD, the City and the CFD will be benefited by the construction and/or acquisition of the EMWD Facilities and/or the Acquisition Facilities and that this Agreement is beneficial to the interests of such residents.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the Parties hereto agree as follows:
1. Recitals. Each of the above recitals is incorporated herein and is true and correct.
2. Definitions. Unless the context clearly otherwise requires, the terms defined in this Section shall, for all purposes of this Agreement, have the meanings herein specified. (a) “Acquisition Facility(ies)” means the sewer and water facilities described as such in Exhibit “C” hereto.
(b) “Act” means the Mello-Roos Community Facilities Act of 1982, Chapter 2.5 (commencing with Section 53311) of Part 1 of Division 2 of Title 5 of the California Government Code.
(c) “Advance” or “Advances” means an amount advanced by Property Owner to EMWD for EMWD Facilities in lieu of payment of EMWD Fees prior to the availability of sufficient Bond Proceeds. Advances shall be deemed payment of EMWD Fees to the extent sufficient Bond Proceeds are not received by or made available to EMWD. (d) “Bond Proceeds” or “Proceeds of the Bonds” shall mean those net funds generated by the sale of the Bonds and investment earnings thereon, net of costs of issuance, reserve fund, capitalized interest and administrative expenses, and may include net funds generated by the levy of Special Taxes and investment earnings thereon.
(e) “Bond Resolution” means that Resolution, Resolution Supplement, Fiscal Agent Agreement, Indenture of Trust or other equivalent document(s) providing for the issuance of the Bonds.
(f) “Bonds” shall mean those bonds, or other securities, issued by, or on behalf of the CFD, in one or more series, as authorized by the qualified electors within the CFD. (g) “Disbursement Request” means a request for payment relating to EMWD Facilities in the form attached hereto as Exhibit “D.”
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 115
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(h) “EMWD Engineer Representative” means an EMWD engineer duly authorized to act on behalf of EMWD or his or her designee.
(i) “EMWD Fees” means water supply development fees, water backup fees, sewer backup fees, sewer treatment capacity charges and all components thereof imposed by EMWD upon the Property to finance EMWD Facilities.
(j) “EMWD Facilities” means those sewer and water facilities listed on Exhibit “C” hereto, which are necessary for the provision of water and sewer services to the Property and paid for with Bond Proceeds in lieu of the payment of EMWD Fees. (k) “Other Facilities Account of the Improvement Fund” means the fund, account or subaccount of the CFD (regardless of its designation within the Bond Resolution) into which a portion of the Bond Proceeds may be deposited in accordance with the Bond Resolution to finance EMWD Facilities and/or the Acquisition Facilities and which may have subaccounts. (l) “Party” or “Parties” shall mean any one or all of the parties to this Agreement. (m) “Payment Request” means a request for payment relating to Acquisition Facilities in the form attached hereto as Exhibit “E”.
(n) “Rate and Method” means the Rate and Method of Apportionment of the Special Tax authorizing the levy and collection of Special Taxes pursuant to proceedings undertaken for the formation of the CFD pursuant to the Act.
(o) “Special Taxes” means the special taxes authorized to be levied and collected within the CFD pursuant to the Rate and Method.
(p) “State” means the State of California.
3. Formation of the CFD. The City has undertaken to analyze the appropriateness of forming the CFD to finance the EMWD Facilities, Acquisition Facilities, and other facilities. The City has and will retain, at the expense of the Property Owner, the necessary consultants to analyze the formation of the CFD.
4. Sale of Bonds and Use of Bond Proceeds. In the event that the CFD is formed and Bonds are issued, the City and the Property Owner shall determine the amount of Bond Proceeds to be deposited in the Other Facilities Account of the Improvement Fund and each subaccount thereof. As Bond Proceeds are transferred to EMWD and reserved to fund EMWD Facilities, as described in Section 5 below, the Property Owner shall receive a credit in the amount transferred against the payment of EMWD Fees with respect to the Property. Nothing herein shall supersede the obligation of an owner of the Property to make an Advance or pay EMWD Fees to EMWD when due. The purpose of this Agreement is to provide a mechanism by which the CFD may issue the Bonds and levy Special Taxes to provide a source of funds to finance EMWD Facilities and Acquisition Facilities in lieu of the payment of EMWD Fees and provision of Acquisition Facilities. In the event that Bond Proceeds, including investment earnings thereon, are not available or sufficient to satisfy the obligation, then the Property Owner shall remain obligated to make an Advance for which it will receive no reimbursement (except to the extent Bond Proceeds later become available to EMWD), or pay EMWD Fees to EMWD as a condition of receiving water and sewer service to the Property.
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 116
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The Bonds shall be issued only if, in its sole discretion, the City Council determines that all requirements of State and federal law and all City policies have been satisfied or have been waived by the City. Nothing in this Agreement shall confer upon EMWD or any owner of the Property, including Property Owner, a right to compel the issuance of the Bonds or the disbursement of Bond Proceeds to fund EMWD Facilities and/or Acquisition Facilities except in accordance with the terms of this Agreement.
If and when the CFD determines to issue Bonds, the CFD shall take such actions necessary in its reasonable discretion to ensure the total effective tax rate within the CFD does not exceed two percent (2%) at the time of Bond sale. The total effective tax rate shall be based on a method of determination of property values reasonably acceptable to the City. CFD shall not include EMWD’s name on property owners’ special tax bills within the CFD.
By entering into this Agreement and requisitioning Bond Proceeds as described herein, EMWD is not passing upon, determining or assuming the tax-exempt status of the Bonds for federal or California state income tax purposes.
5. Disbursements for EMWD Facilities.
(a) Upon the funding of the Other Facilities Account of the Improvement Fund with funds reserved to fund EMWD Facilities, the Property Owner shall notify EMWD of the amount of Bond Proceeds reserved to fund EMWD Facilities and the Property Owner and EMWD may execute and submit a Disbursement Request for payment to the City or the CFD requesting disbursement of an amount equal to all or a portion of Advances from the Other Facilities Account of the Improvement Fund to the extent that Bond Proceeds are available in the Other Facilities Account of the Improvement Fund for such purpose. Upon EMWD’s receipt of funds pursuant to such Disbursement Request, the Property Owner shall receive reimbursement of the Advances from EMWD. To facilitate EMWD’s bookkeeping, EMWD may direct in a Disbursement Request, that all or a portion of a payment be made directly from the Other Facilities Account to the Property Owner as reimbursement for Advances made by the Property Owner. In the event of a reimbursement to the Property Owner pursuant to the preceding sentence, EMWD shall account for an equivalent amount of Advances previously received from the Property Owner in accordance with Section 5(c) below.
To the extent that EMWD expends all or a portion of an Advance pending the deposit of Bond Proceeds in the Other Facilities Account of the Improvement Fund, for purposes of Treasury Regulations regarding investment and expenditure of Bond Proceeds and State law provisions regarding financing of public capital facilities, the Advance shall be a considered an interest free loan by the Property Owner, which EMWD only agrees to repay to the extent of the deposit, if any, of Bond Proceeds in the Other Facilities Account of the Improvement Fund and EMWD’s written direction as described below to pay all or a portion of such deposit to the Property Owner as repayment of an Advance.
(b) From time to time following the funding of the Other Facilities Account of the Improvement Fund, the Property Owner may notify EMWD in writing and the Property Owner and EMWD may jointly request a disbursement from the Other Facilities Account of the Improvement Fund to fund EMWD Facilities by executing and submitting a Disbursement Request. Upon receipt of such Disbursement Request completed in accordance with the terms of this Agreement, the CFD shall wire transfer or otherwise pay to EMWD (or upon EMWD’s written direction pay to the Property Owner or an EMWD contractor) such requested funds to the extent that Bond Proceeds are available Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 117
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in the Other Facilities Account of the Improvement Fund for such purpose. Upon such notice and EMWD’s receipt of such disbursement (or upon payment to the Property Owner or an EMWD contractor in accordance with directions from EMWD relating to EMWD Facilities), the Property Owner shall be deemed to have satisfied the applicable EMWD Fees with respect to the number of dwelling units or lots for which the EMWD Fees would otherwise have been required in an amount equal to such disbursement.
(c) EMWD agrees that prior to submitting a Disbursement Request requesting payment from the CFD it shall review and approve all costs included in its request and will have already paid or incurred such costs of EMWD Facilities from its own funds (which may include Advances from the Property Owner) subsequent to the date of this Agreement, or will disburse such amounts to pay the costs of EMWD Facilities following receipt of funds from the CFD. In the event that EMWD does not disburse any Bond Proceeds (or equivalent amount of Advances repaid pursuant to the second to the last sentence of the first paragraph of Section 5(a) above) received by it to third parties within five banking days of receipt, it will trace and report to the CFD all earnings, if any, earned by EMWD, from the date of receipt of such Bond Proceeds by EMWD (or the date of disbursement pursuant to the second to the last sentence of the first paragraph of Section 5(a) above) to the date of expenditure by EMWD for capital costs of the EMWD Facilities. Such report shall be delivered at least semiannually until all Bond Proceeds are expended by EMWD. EMWD agrees that in processing the above disbursements it will comply with all legal requirements for the expenditure of Bond Proceeds under the Internal Revenue Code of 1986 and any amendments thereto. (d) EMWD agrees to maintain adequate internal controls over its payment function and to maintain accounting records in accordance with generally accepted accounting procedures.
EMWD will, upon request, provide the City and/or the Property Owner with access to EMWD’s records related to the EMWD Facilities and expenditure of Advances and will provide to the City its annual financial report certified by an independent certified public accountant for purposes of assisting the City in calculating the arbitrage rebate obligation of the CFD, if any. (e) The City or the CFD agrees to maintain full and accurate records of all amounts, and investment earnings, if any, expended from the Other Facilities Account of the Improvement Fund and expenditure of Advances. The City or the CFD will, upon request, provide EMWD and/or Property Owner with access to the City’s or the CFD’s records related to the Other Facilities Account of the Improvement Fund.
(f) The City acknowledges that it is in receipt of and has reviewed the EMWD Comprehensive Debt Policy (“Debt Policy”). At the time of formation of the CFD, the City and the CFD are in conformance with Section 3.1 of the Debt Policy and it is expected that the City and CFD will remain in conformance with Section 3.1 at the time of any Bond sale. However, City and EMWD acknowledge that the City has the ultimate responsibility for issuance of the Bonds, the administration of the CFD, and the tax-exempt status of any Bonds issued by the CFD. Accordingly, the City Council shall have ultimate responsibility for making all decisions with respect to the issuance of any CFD Bonds and the levy of CFD Special Taxes.
6. Ownership of EMWD Facilities and Acquisition Facilities. The EMWD Facilities and Acquisition Facilities shall be and remain the property of EMWD.
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 118
Menifee Mayor and City Council May 18, 2022
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7. Acquisition Facilities. The requirements of this Section 7 shall apply to any Acquisition Facility for which a Payment Request is submitted to EMWD pursuant to this Section 7. (a) Design Plans and Specifications. All plans, specifications and bid documents for the Acquisition Facility (“Plans”) constructed or to be constructed by the Property Owner shall be prepared by the Property Owner at the Property Owner’s initial expense, subject to approval by EMWD. Costs for preparation of the Plans shall be included in the acquisition price. Reimbursement of costs for plan revisions will be considered on a case by case basis. The Property Owner shall not award bids for construction, or commence or cause commencement of construction, of the Acquisition Facility until the Plans and bidding documents have been approved by EMWD. The bid opening for the Acquisition Facility shall be coordinated with and take place at EMWD’s offices, with EMWD personnel in attendance.
(b) Construction of Acquisition Facilities. A qualified engineering firm (the “Field Engineer”) shall be employed by the Property Owner to provide all field engineering surveys determined to be necessary by the EMWD’s inspection personnel. Field Engineer shall promptly furnish to EMWD a complete set of grade sheets listing all locations, offsets, etc., in accordance with good engineering practices, and attendant data and reports resulting from Field Engineer’s engineering surveys and/or proposed facility design changes. EMWD shall have the right, but not the obligation, to review, evaluate and analyze whether such results comply with applicable specifications.
A full-time soil testing firm, approved by EMWD, shall be employed by the Property Owner to conduct soil compaction testing and certification. The Property Owner shall promptly furnish results of all such compaction testing to EMWD for its review, evaluation and decision as to compliance with applicable specifications. In the event the compaction is not in compliance with applicable specifications, the Property Owner shall be fully liable and responsible for the costs of achieving compliance. A final report certifying all required compaction in accordance with the specifications shall be a condition of final acceptance of the Acquisition Facility.
The costs of all surveying, testing and reports associated with the Acquisition Facility furnished and constructed by the Property Owner’s contractor(s) shall be included in the acquisition price.
EMWD shall not be responsible for conducting any environmental, archaeological, biological, or cultural studies or any mitigation requirements that may be requested by appropriate Federal, State, and/or local agencies with respect to the Acquisition Facility. Any such work shall be paid for and conducted by the Property Owner and included in the acquisition price of the Acquisition Facility.
(c) EMWD Public Works Requirements. In order that the Acquisition Facility may be properly and readily acquired by EMWD, the Property Owner shall comply with all of the following requirements with respect to the Acquisition Facility, and the Property Owner shall provide such proof to the EMWD as EMWD may reasonably require and at such intervals and in such form as EMWD may reasonably require, that the following requirements have been satisfied as to the Acquisition Facility:
(i) The Property Owner shall prepare a bid package for review, comment and approval by the General Manager of EMWD or his designee (the “EMWD Representative”).
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 119
Menifee Mayor and City Council May 18, 2022
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(ii) The Property Owner shall, after obtaining at least three sealed bids for the construction of the Acquisition Facility in conformance with the procedures and requirements of EMWD, submit to EMWD written evidence of such competitive bidding procedure, including evidence of the means by which bids were solicited, a listing of all responsive bids and their amounts, and the name or names of the contractor or contractors to whom the Property Owner proposes to award the contracts for such construction, which shall be the lowest responsible bidder. (iii) The EMWD Representative shall attend the bid opening. If unable to attend the bid opening, the EMWD Representative shall approve or disapprove of a contractor or contractors, in writing, within five (5) business days after receipt from the Property Owner of the name or names of such contractor or contractors recommended by the Property Owner. If the EMWD Representative disapproves of any such contractor; the Property Owner shall select the next lowest responsible bidder from the competitive bids received who is acceptable to the EMWD Representative. (iv) The specifications and bid and contract documents shall require all such contractors to pay prevailing wages and to otherwise comply with applicable provisions of the Labor Code, the Government Code and the Public Contract Code relating to public works projects and as required by the procedures and standards of EMWD with respect to the construction of its public works projects.
(v) The Property Owner shall submit faithful performance and payment bonds conforming in all respects to the requirements set forth in EMWD’s “Standard Water and/or Sewer Facilities and Service Agreement.” The following documents shall be submitted to EMWD along with the performance and payment bonds:
(1) The original, or a certified copy, of the unrevoked appointment, power of attorney, bylaws, or other instrument entitling or authorizing the person who executed the bond to do so;
(2) A certified copy of the certificate of authority of the insurer issued by the State of California’s Insurance Commissioner; and (3) Copies of the insurer’s most recent annual and quarterly statements filed with the Department of Insurance.
(vi) The Property Owner and its contractor and subcontractors shall be required to provide proof of insurance coverage throughout the term of the construction of the Acquisition Facility, which they will construct in conformance with EMWD’s standard procedures and requirements. EMWD’s insurance requirements are set out in Section 7(n) herein. (vii) The Property Owner and all such contractors shall comply with such other requirements relating to the construction of the Acquisition Facility which EMWD may impose by written notification delivered to the Property Owner and each such contractor at the time either prior to the receipt of bids by the Property Owner for the construction of such Acquisition Facility or, to the extent required as a result of changes in applicable laws, during the progress of construction thereof.
In accordance with Section 7(f), the Property Owner shall be deemed the awarding body and shall be solely responsible for compliance and enforcement of the provisions of the Labor Code, Government Code, and Public Contract Code.
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(viii) A “Change Order” is an order from the Property Owner to a contractor authorizing a change in the work to be performed. The Property Owner shall receive comments from the EMWD Representative prior to the Property Owner’s approval of any Change Order. The EMWD Representative shall comment on or deny the Change Order request within five (5) business days of receipt of all necessary information. EMWD’s comments to a Change Order shall not be unreasonably delayed, conditioned or withheld. The Property Owner shall not be entitled to include in the acquisition price costs associated with a Change Order that have not been approved by the EMWD Representative. (d) Inspection; Completion of Construction. EMWD shall have primary responsibility for inspecting the Acquisition Facility to assure that the work is being accomplished in accordance with the Plans. Such inspection does not include inspection for compliance with safety requirements by the Property Owner’s contractor(s). EMWD’s personnel shall be granted access to each construction site at all reasonable times for the purpose of accomplishing such inspection. Upon satisfaction of EMWD’s inspectors, the Property Owner shall notify EMWD in writing that an Acquisition Facility has been completed in accordance with the Plans.
Within three (3) business days of receipt of written notification from EMWD inspectors that an Acquisition Facility has been completed in accordance with the Plans, the EMWD Representative shall notify the Property Owner in writing that such Acquisition Facility has been satisfactorily completed. Upon receiving such notification, the Property Owner shall file a Notice of Completion with the County of Riverside Recorder’s Office, pursuant to the provisions of Section 3093 of the Civil Code. The Property Owner shall furnish to EMWD a duplicate copy of each such Notice of Completion showing thereon the date of filing with the County of Riverside (the “County”).
EMWD will in turn file a notice with the County for acceptance. (e) Liens. With respect to the Acquisition Facility, upon the earlier of (i) receipt of all applicable lien releases, or (ii) expiration of the time for the recording of claim of liens as prescribed by Sections 3115 and 3116 of the Civil Code, the Property Owner shall provide to EMWD such evidence or proof as EMWD shall require that all persons, firms and corporations supplying work, labor, materials, supplies and equipment for the construction of the Acquisition Facility have been paid, and that no claims of liens have been recorded by or on behalf of any such person, firm or corporation.
(f) Acquisition; Acquisition Price; Source of Funds. The costs eligible to be included in the acquisition price of the Acquisition Facility (the “Actual Costs”) shall include:
(i) The actual hard costs for the construction of such Acquisition Facility as established by EMWD-approved construction contracts and approved Change Orders, including costs of payment, performance and maintenance bonds and insurance costs, pursuant to this Agreement;
(ii) The design and engineering costs of such Acquisition Facility including, without limitation, the costs incurred in preparing the Plans. Costs for plan revisions will be considered on a case by case basis;
(iii) The costs of environmental evaluations and public agency permits and approvals attributable to the Acquisition Facility;
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(iv) Costs incurred by the Property Owner for construction management and supervision of such Acquisition Facility, not to exceed five percent (5%) of the actual construction cost, subject to prior approval by EMWD of any construction management or supervision contract with respect to the Acquisition Facility;
(v) Professional costs associated with the Acquisition Facility such as engineering, inspection, construction staking, materials, testing and similar professional services; and (vi) Costs approved by EMWD of acquiring from an unrelated third party any real property or interests therein required for the Acquisition Facility including, without limitation, temporary construction easements, temporary by-pass road and maintenance easements.
Provided the Property Owner has complied with the requirements of this Agreement, EMWD agrees to execute and submit to the City a Payment Request for payment of the acquisition price of the completed Acquisition Facility to the Property Owner or its designee within thirty (30) days after the Property Owner’s satisfaction of the preconditions to such payment stated herein.
As a condition to EMWD’s execution of the Payment Request for the acquisition price, the property ownership of the completed Acquisition Facility shall be transferred to EMWD by grant deed, bill of sale or such other documentation as EMWD may require free and clear of all taxes, liens, encumbrances, and assessments, but subject to any exceptions determined by EMWD to not interfere with the actual or intended use of the land or interest therein (including the lien of a community facilities district so long as the subject property is exempt from taxation or is otherwise not taxable by such community facilities district). Upon the transfer of property ownership of the Acquisition Facility or any portion thereof to EMWD, EMWD shall be responsible for the maintenance of such Acquisition Facility or the portion transferred. Notwithstanding the foregoing, the acquisition price of an Acquisition Facility may be paid prior to transfer of property ownership and acceptance of the Acquisition Facility if it is substantially completed at the time of payment. The Acquisition Facility shall be considered “substantially complete” when it has been reasonably determined by EMWD to be usable, subject to final completion of such items as the final lift or any other items not essential to the primary use or operation of the Acquisition Facility.
For purposes of determining the acquisition price to be paid by the CFD for the acquisition of each Acquisition Facility by EMWD, the value of such Acquisition Facility shall include the construction costs specified in EMWD-approved contracts and EMWD-approved change orders conforming to this Section 7, as hereinbefore specified. EMWD approval is a condition prior to initiation of contract work. However, if EMWD reasonably determines that the additional Actual Costs are excessive and that the value of the Acquisition Facility is less than the total amount of such Actual Costs and such construction costs, the price to be paid for the acquisition of the Acquisition Facility shall be the value thereof as determined by the EMWD Engineer Representative, subject, however, to the Property Owner’s right to appeal to EMWD’s Board of Directors.
Upon completion of the construction of an Acquisition Facility, the Property Owner shall deliver or cause to be delivered to EMWD a Payment Request in substantially the form of Exhibit “E,” attached hereto, copies of the contract(s) with the contractor(s) who have constructed the Acquisition Facility and other relevant documentation with regard to the payments made to such contractor(s) and each of them for the construction of the Acquisition Facility, documentation evidencing payment of prevailing wages, and shall also provide to EMWD invoices and purchase orders with respect to all equipment, materials and labor purchased for the construction of the Item Title: 11.1
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Acquisition Facility. EMWD shall require the EMWD Engineer Representative to complete its determination of the acquisition price of the Acquisition Facility as promptly as is reasonably possible.
Notwithstanding the preceding provisions of this Section, the source of funds for the acquisition of the Acquisition Facility or any portion thereof shall be funds on deposit in the Other Facilities Account of the Improvement Fund. If no such funds are available, EMWD shall not be required to acquire the Acquisition Facility from the Property Owner. In such event, the Property Owner shall complete the design and construction and offer to EMWD property ownership of such portions of the Acquisition Facility as are required to be constructed by the Property Owner as a condition to recordation of subdivision maps for the Property, but need not construct any portion of the Acquisition Facility which it is not so required to construct. Reimbursement for these facilities would be made pursuant to the “Standard Water and/or Sewer Facilities and Service Agreement(s)” by and between EMWD and the Property Owner.
(g) Easements and/or Fee Title Property Ownership Deeds. The Property Owner shall, at the time EMWD acquires the Acquisition Facility as provided in Section 7(f) hereof, grant or cause to be granted to EMWD, by appropriate instruments prescribed by EMWD, all easements across private property and/or fee title property ownership deeds which may be reasonably necessary for the proper operation and maintenance of such Acquisition Facility, or any part thereof. (h) Permits. The Property Owner shall be responsible for obtaining all necessary construction permits from the City covering construction and installation of the Acquisition Facility.
EMWD will request the City to issue an “operate and maintain permit” to EMWD, which will become effective upon the completion of the Acquisition Facility and acceptance of property ownership therewith by EMWD.
(i) Maintenance. Prior to the transfer of property ownership of an Acquisition Facility by the Property Owner to EMWD, as provided in Section 7(f) hereof, the Property Owner shall be responsible for the maintenance thereof and shall require its contractor(s) to repair all facilities damaged by any party, prior to acceptance by EMWD and/or make corrections determined to be necessary by EMWD’s inspection personnel.
(j) Inspection of Records. EMWD shall have the right to review all books and records of the Property Owner pertaining to the costs and expenses incurred by the Property Owner for the design and construction of the Acquisition Facility during normal business hours by making arrangements with the Property Owner. The Property Owner shall have the right to review all books and records of EMWD pertaining to costs and expenses incurred by EMWD for services of the EMWD Engineer Representative by making arrangements with EMWD. (k) Property Ownership of Improvements. Notwithstanding the fact that some or all of the Acquisition Facility may be constructed in dedicated street rights-of-way or on property which has been or will be dedicated to EMWD, each Acquisition Facility shall be and remain the property of the Property Owner until acquired by EMWD as provided in this Agreement. (l) Materials and Workmanship Warranty. Upon the completion of the acquisition of an Acquisition Facility by EMWD, the performance bond related to such individual Acquisition Facility provided by the Property Owner pursuant to Section 7(c)(v) hereof, shall be reduced by 90%, and the remaining 10% shall serve as a maintenance bond to guarantee that such Acquisition Facility will be free from defects due to faulty workmanship or materials for a period of one year. Release of Item Title: 11.1
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performance and payment bonds is addressed in the Standard Water and/or Sewer Facilities and Service Agreement, by and between EMWD and the Property Owner. (m) Independent Contractor. In performing this Agreement with respect to the Acquisition Facilities, the Property Owner is an independent contractor and not the agent of EMWD.
EMWD shall not have any responsibility for payment to any contractor, subcontractor or supplier of the Property Owner. It is not intended by the Parties that this Agreement create a partnership or joint venture among them and this Agreement shall not otherwise be construed. (n) Insurance Requirements. Neither the Property Owner nor its contractor shall commence work on an Acquisition Facility under this Agreement prior to obtaining all insurance required hereunder with a company or companies acceptable to EMWD, nor shall the Property Owner’s contractor allow any subcontractor to commence work on its subcontract until all insurance required of the subcontractor has been obtained.
The Property Owner shall, during the life of this Agreement, notify EMWD in writing of any incident giving rise to any potential bodily injury or property damage claim and any resultant settlements, whether in conjunction with this or any other project which may affect the limits of the required coverage, as soon as is reasonable and practical.
Both the Property Owner and its contractor shall conform in every respect to the requirements set forth in the Standard Water and/or Sewer Facilities and Service Agreement, by and between EMWD and the Property Owner.
8. Indemnification.
(a) Indemnification by the City. The City shall assume the defense of, indemnify and save harmless, EMWD, its officers, employees and agents, and each and every one of them, from and against all actions, damages, claims, losses or expenses of every type and description to which they may be subjected or put, by reason of, or resulting from, any act or omission of the City with respect to this Agreement and the issuance of the Bonds; provided, however, that the City shall not be required to indemnify any person or entity as to damages resulting from negligence or willful misconduct of such person or entity or their officers, agents or employees. (b) Indemnification by Property Owner. Property Owner shall assume the defense of, indemnify and save harmless, the City, the CFD and EMWD, their respective officers, employees and agents, and each and every one of them, from and against all actions, damages, claims, losses or expenses of every type and description to which they may be subjected or put, by reason of, or resulting from, any act or omission of Property Owner with respect to this Agreement; provided, however, that Property Owner shall not be required to indemnify any person or entity as to damages resulting from negligence or willful misconduct of such person or entity or their officers, agents or employees. (c) Indemnification by EMWD. EMWD shall assume the defense of, indemnify and save harmless, the City, the CFD and their respective officers, employees and agents, and each and every one of them, from and against all actions, damages, claims, losses or expenses of every type and description to which they may be subjected or put, by reason of, or resulting from, any act or omission of EMWD with respect to this Agreement, and the design, engineering and construction of the EMWD Facilities and the Acquisition Facilities constructed by EMWD; provided, however, that EMWD shall Item Title: 11.1
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not be required to indemnify any person or entity as to damages resulting from negligence or willful misconduct of such person or entity or their officers, agents or employees.
9. Allocation of Special Taxes. The entire amount of any Special Taxes levied by the CFD to repay Bonds, or to fund other obligations, shall be allocated to the CFD.
10. Amendment and Assignment. This Agreement may be amended at any time but only in writing signed by each Party hereto. This Agreement may be assigned, in whole or in part, by the Property Owner to the purchaser of any parcel of land within the Property, provided, however, such assignment shall not be effective unless and until EMWD and the City have been notified, in writing, of such assignment and the assignment specifies whether the Property Owner or such assignee is authorized to execute disbursement requests.
11. Entire Agreement. This Agreement contains the entire agreement between the Parties with respect to the matters provided for herein and supersedes all prior agreements and negotiations between the Parties with respect to the subject matter of this Agreement.
12. Notices. Any notice, payment or instrument required or permitted by this Agreement to be given or delivered to either Party shall be deemed to have been received when personally delivered or seventy-two hours following deposit of the same in any United States Post Office in California, registered or certified, postage prepaid, addressed as follows:
City: City of Menifee
29844 Haun Road
Menifee, CA 92586
Attention: Deputy City Manager
EMWD: Eastern Municipal Water District
P.O. Box 8300
2270 Trumble Road
Perris, CA 92572-8300
Attention: Special Funding Division
Email: [email protected]
Property Owner: Lennar Homes of California, LLC
980 Montecito Dr., Suite 300
Corona, CA 92879
Attention: Geoff Smith
Each Party may change its address for delivery of notice by delivering written notice of such change of address to the other Parties hereto. Each such notice, statement, demand, consent, approval, authorization, offer, designation, request or other communication hereunder shall be deemed delivered to the party to whom it is addressed (a) if personally served or delivered, upon delivery, (b) if given by electronic communication, whether by telex, telegram or telecopier upon the sender’s receipt of written acknowledgement from the addressee, (c) if given by registered or certified mail, return receipt requested, deposited with the United States mail postage prepaid, 72 hours after such notice is deposited with the United States mail, (d) if given by overnight courier, with courier charges prepaid, 24 hours after delivery to said overnight courier, or (e) if given by any other means, upon delivery at the address specified in this Section.
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13. Exhibits. All exhibits attached hereto are incorporated into this Agreement by reference.
14. Attorney’s Fees. In the event of the bringing of any action or suit by any Party against any other Party arising out of this Agreement, the Party in whose favor final judgment shall be entered shall be entitled to recover from the losing Party all costs and expenses of suit, including reasonable attorney’s fees.
15. Interpretation in the event of Ambiguities or Disputes. The Parties acknowledge and agree that each has been given the opportunity to review this Agreement with legal counsel independently, and/or has the requisite experience and sophistication to understand, interpret, and agree to the particular language of the provisions hereof. In the event of an ambiguity in or dispute regarding the interpretation of same, the interpretation of this Agreement shall not be resolved by any rule of interpretation providing for interpretation against the Party who causes the uncertainty to exist or against the drafter.
16. Severability. If any part of this Agreement is held to be illegal or unenforceable by court of competent jurisdiction, the remainder of this Agreement shall be given effect to the fullest extent reasonably possible.
17. Governing Law. This Agreement and any dispute arising hereunder shall be governed by interpreted in accordance with the laws of the State of California.
18. Waiver. Failure by a Party to insist upon the strict performance of any of the provisions of this Agreement by any other Party hereto, or the failure by a Party to exercise its rights upon the default of any other Party, shall not constitute a waiver of such Party’s right to insist and demand strict compliance by such other Party with the terms of this Agreement thereafter.
19. No Third Party Beneficiaries. No person or entity other than the CFD, when and if formed, shall be deemed to be a third party beneficiary hereof, and nothing in this Agreement (either express or implied) is intended to confer upon any person or entity, other than EMWD, the City, the CFD and Property Owner (and their respective successors and assigns, exclusive of individual homebuyers), any rights, remedies, obligations or liabilities under or by reason of this Agreement.
20. Singular and Plural; Gender. As used herein, the singular of any word includes the plural, and terms in the masculine gender shall include the feminine.
21. Termination. If the City determines and notifies the other Parties in writing that the CFD is unable to complete the sale of the Bonds, any obligation of the Parties, if any, to finance all or any EMWD Facilities with Bond Proceeds pursuant to this Agreement shall automatically terminate and be of no further force or effect.
22. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which shall constitute but one instrument. [REMAINDER OF PAGE LEFT BLANK]
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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day and year written above.
CITY OF MENIFEE
Deputy City Manager
ATTEST:
By:
Sarah Manwaring, City Clerk
APPROVED AS TO FORM:
CITY ATTORNEY OF THE CITY OF MENIFEE
By:
Jeffrey T. Melching, City Attorney
[SIGNATURES CONTINUED ON NEXT PAGE.]
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EASTERN MUNICIPAL WATER DISTRICT
By:
Joe Mouawad, P.E., General Manager
ATTEST:
By:
Sheila Zelaya, Board Secretary
PROPERTY OWNER
LENNAR HOMES OF CALIFORNIA, LLC,
a California limited liability company
By:
Its:
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EXHIBIT “A”
COMMUNITY FACILITIES DISTRICT NO. 2022-1 (QUARTZ RANCH)
OF THE CITY OF MENIFEE
DEPICTION OF PROPERTY
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EXHIBIT “B”
COMMUNITY FACILITIES DISTRICT NO. 2022-1 (QUARTZ RANCH)
OF THE CITY OF MENIFEE
DESCRIPTION OF PROPERTY
City of Menifee, County of Riverside, State of California Tract Map(s):
TRACT NO. 28786
TRACT NO. 28791
TRACT NO. 28792
TRACT NO. 28793
TRACT NO. 28794
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EXHIBIT “C”
COMMUNITY FACILITIES DISTRICT NO. 2022-1 (QUARTZ RANCH)
OF THE CITY OF MENIFEE
FACILITIES DESCRIPTION
1. EMWD Facilities. The type of EMWD Facilities eligible to be financed by the CFD under the Act are as follows:
Those water and sewer facilities included in EMWD’s water and sewer capacity and connection fee programs used to finance expansion projects, exclusive of in-tract facilities contributed by Property Owner. EMWD Facilities include, but are not limited to the following: water and sewer transmission pipelines, sewer treatment plants, disposal ponds, pumping plants, lift stations and water reservoirs, including all costs of site acquisition, planning, design, engineering, legal services, materials testing, coordination, surveying, construction staking, construction, inspection and any and all appurtenant facilities and appurtenant work relating to the foregoing.
2. Acquisition Facilities. The types of Acquisition Facilities eligible to be financed by the CFD under the Act shall consist of sewer and water transmission lines, sewer and water pump stations and water reservoirs, including all costs of site acquisition, planning, design, engineering, legal services, materials testing, coordination, surveying, construction staking, construction inspection and any and all appurtenant facilities to the foregoing required to serve the Property. The facilities listed above are representative of the types of facilities eligible to be financed by the CFD as Acquisition Facilities. Detailed scope and limits of specific projects will be determined by EMWD as appropriate, consistent with the standards of the EMWD.
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EXHIBIT “D”
COMMUNITY FACILITIES DISTRICT NO. (2022-1 QUARTZ RANCH)
OF THE CITY OF MENIFEE
DISBURSEMENT REQUEST FORM
(EMWD Facilities)
1. City of Menifee Community Facilities District No. 2022-1 (Quartz Ranch) of the City of Menifee (“CFD”) is hereby requested to pay from the CFD bond proceeds (“Bond Proceeds”) to Eastern Municipal Water District (“EMWD”), as Payee, or to EMWD’s designee, the sum set forth in 3 below.
2. The undersigned certifies that the amount requested for EMWD Facilities is due and payable, has not formed the basis of prior request or payment, and is being made with respect to the connection of the property described below to the EMWD system.
3. Amount requested: $________________
For Tract/Lot Nos: _________________
4. The amount set forth in 3 above is authorized and payable pursuant to the terms of the Joint Community Facilities Agreement, by and among the City of Menifee, EMWD and Lennar Homes of California, LLC, dated _________, 2022 (the “Agreement”). Capitalized terms not defined herein shall have the meaning set forth in the Agreement. EMWD shall spend the Bond Proceeds allocated hereby in accordance with the requirements set forth in Section 5 of the Agreement.
5. By entering into the Agreement and requisitioning Bond Proceeds as described herein, EMWD is not passing upon, determining or assuming the tax-exempt status of the Bonds for federal or California state income tax purposes.
PROPERTY OWNER
LENNAR HOMES OF CALIFORNIA, LLC,
a California liability company
By:
EASTERN MUNICIPAL WATER DISTRICT
By:
Name:
Title:
Date:
cc: EMWD Special Funding District
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EXHIBIT “E”
CITY OF MENIFEE
COMMUNITY FACILITIES DISTRICT NO. 2022-1 (QUARTZ RANCH)
PAYMENT REQUEST FORM
CITY OF MENIFEE CFD NO. 2022-1 (QUARTZ RANCH) – OTHER FACILITIES ACCOUNT
OF THE IMPROVEMENT FUND
City of Menifee (“City”), Eastern Municipal Water District (“EMWD”) and _______________ (“Property Owner”) are parties to the Joint Community Facilities Agreement, dated as of __________ (the “EMWD JCFA”). Capitalized undefined terms used herein shall have the meanings ascribed thereto in the EMWD JCFA. Pursuant to the EMWD JCFA, Property Owner hereby requests approval of the acquisition price of the Acquisition Facility(ies) described in Attachment A attached hereto. In connection with this Payment Request, Property Owner hereby represents and warrants to the EMWD as follows:
(a) The person executing this Payment Request is qualified to execute this Payment Request on behalf of Property Owner and knowledgeable as to the matters set forth herein. (b) The Acquisition Facility(ies) have been constructed in accordance with the Plans therefor, and in accordance with all applicable EMWD standards and the requirements of the EMWD JCFA.
(c) The true and correct Actual Cost of the Acquisition Facility(ies) is set forth in Attachment A.
(d) Property Owner has submitted or submits herewith to EMWD the contracts, invoices, receipts, worksheets and other evidence of Actual Costs which are in sufficient detail to allow the EMWD Representative to verify the Actual Cost of the Acquisition Facility(ies) for which payment is requested.
(e) There are no liens, rights to lien or attachment upon, or claims affecting the right to receive the payment requested herein which has not been released or will not be released simultaneously with the payment of such obligation, other than materialmen’s or mechanics’ liens accruing by operation of law. Copies of lien releases for all work for which payment is requested hereunder are attached hereto.
Property Owner hereby declares under penalty of perjury that the above representations and warranties are true and correct.
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Property Owner hereby requests that the acquisition price be paid to the person or persons, in the amount set forth in Attachment B hereto.
PROPERTY OWNER
LENNAR HOMES OF CALIFORNIA, LLC,
a California liability company
By:
Its:
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CONFIRMATION AND APPROVAL BY EMWD
EMWD has (a) confirmed that the Acquisition Facility(ies) described in Attachment A is complete and was constructed in accordance with the Plans therefor, and (b) reviewed, verified and approved the acquisition price of such Acquisition Facility(ies). Such Acquisition Facility(ies) is/are complete and the acquisition price therefor eligible for payment is $________. The amount to be paid and the payee(s) are described in Attachment B.
Date: AUTHORIZED REPRESENTATIVE OF EMWD
By:
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ATTACHMENT A
Acquisition Facility Actual Cost Acquisition Price*
Total Acquisition Price to be Paid:
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ATTACHMENT B
ACQUISITION PRICE PAYMENT INSTRUCTIONS
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JOINT COMMUNITY FACILITIES AGREEMENT
by and among
CITY OF MENIFEE
AND
MENIFEE UNION SCHOOL DISTRICT
AND
LENNAR HOMES OF CALIFORNIA, LLC
RELATING TO
COMMUNITY FACILITIES DISTRICT NO. 2022-1 (QUARTZ RANCH)
OF THE CITY OF MENIFEE
Dated _________, 2022
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JOINT COMMUNITY FACILITIES AGREEMENT
BY AND AMONG
CITY OF MENIFEE
AND
MENIFEE UNION SCHOOL DISTRICT
AND LENNAR HOMES OF CALIFORNIA, LLC
(Community Facilities District No. 2022-1 (Quartz Ranch) of the City of Menifee)
THIS JOINT COMMUNITY FACILITIES AGREEMENT (“Agreement”) is made and entered into as of the ____ day of ___________, 2022, by and among the CITY OF MENIFEE, a general law city (the “City”), the MENIFEE UNION SCHOOL DISTRICT, a California public school district organized and operating pursuant to the applicable provisions of the California Education Code and the California Constitution (“School District”) and LENNAR HOMES OF CALIFORNIA, LLC (“Property Owner”).
R E C I T A L S:
A. Property Owner is the owner or developer of certain real property located within the boundaries of the City and School District, consisting of approximately 379 lots on approximately 119 gross acres within Tract Nos. 28786 and 28791, 28792, 28793, and 28794 proposed to be included within the boundaries of the CFD (defined below) (collectively the “Project”) in the County of Riverside (“County”) and as more fully described in Exhibit “A” attached hereto (the “Property”).
B. Pursuant to that certain School Facilities Funding and Mitigation Agreement, by and between the School District and Property Owner dated as of March 26, 2019 (the “Mitigation Agreement”), in lieu of the statutory school fees, the Property Owner shall pay the Mitigation Payment (as defined in the Mitigation Agreement) to the School District in accordance with the terms of the Mitigation Agreement, which may be paid, in whole or in part, from Bond Proceeds (defined below) of Community Facilities District No. 2022-1 (Quartz Ranch) of the City of Menifee (the “CFD”). The City Facilities defined below and School Facilities (defined herein) are sometimes collectively referred to herein as the “Facilities.”
C. Property Owner and School District entered into a Purchase and Sale Agreement And Escrow Instructions dated December 14, 2004 (“Purchase Agreement”) related to a 14 acre site adjacent to the Project (“School Site”). Pursuant to Section 2 of the Purchase Agreement, Property Owner received a credit against School District school fees in the amount of $2,900,000 (“School Site Purchase Price”).
D. The City is authorized by Section 53313.5 of the Act to finance, by means of the CFD, the School Facilities. This Agreement constitutes a “joint community facilities agreement” (“JCFA”) within the meaning of Section 53316.2 of the Act by and among the City, School District and Property Owner, pursuant to which the CFD will be authorized to finance the School Facilities. As provided by Section 53316.6 of the Act, responsibility for constructing, maintaining and operating the City Facilities is the City’s to the extent set forth herein and responsibility for constructing, providing and operating the School Facilities is the School District’s.
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 139
Menifee Mayor and City Council May 18, 2022
2 E. The provision of the City Facilities and School Facilities is necessitated by the Project, and the Parties hereto find and determine that the residents of the City, School District and CFD will be benefited by the financing of the City Facilities and School Facilities, and that this Agreement is beneficial to the interests of such residents.
ARTICLE I
GENERAL PROVISIONS
Section 1.1. Recitals.
The above recitals are true and correct and are hereby incorporated by this reference.
Section 1.2. Definitions.
Unless the context clearly otherwise requires, the terms defined in this Section shall, for all purposes of this Agreement, have the meanings herein specified. (a) “Act” means the Mello-Roos Community Facilities Act of 1982, as amended, commencing with California Government Code Section 53311, et seq. (b) “Agreement” means this Joint Communities Facilities Agreement. (c) “Bond Proceeds” shall mean those net funds generated by the sale of the Bonds. (d) “Bond Resolution” means that Resolution, Resolution Supplement, Fiscal Agent Agreement, Indenture of Trust or other equivalent document(s) providing for the issuance of the Bonds.
(e) “Bonds” shall mean those bonds, or other securities, issued by, or on behalf of the CFD, as authorized by the qualified electors of the CFD. (f) “CFD” means Community Facilities District No. 2022-1 (Quartz Ranch) of the City of Menifee.
(g) “Deposits” mean all amounts advanced to School District by Property Owner, including the School Site Purchase Price, or Property Owner’s successor in interest, (i) prior to the issuance and sale of Bonds and the funding of the School Fee Fund or (ii) at such time as the funds in the School Fee Fund have been temporarily depleted, as security for future payment, with Bond Proceeds, of the Mitigation Payments due in connection with certificates of compliance issued by School District for lots within the Project.
(h) “Disbursement Request” means a request for payment relating to School Facilities in the form attached hereto as Exhibit “B.”
(i) “City Facilities” means certain City facilities authorized to be financed by the CFD pursuant to the Act including, but not limited to fire and safety facilities, street, storm, drainage and park facilities necessary to serve the Project.
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 140
Menifee Mayor and City Council May 18, 2022
3 (j) “Mitigation Payment or Payments” has the meaning set forth in the Mitigation Agreement.
(k) “Party” or “Parties” shall mean any one or all of the parties to this Agreement and the CFD.
(l) “Rate and Method” means each individual Rate and Method of Apportionment of the Special Tax authorizing the levy and collection of special taxes pursuant to proceedings undertaken for the formation of the CFD pursuant to the Act. (m) “School Facilities” means those school sites, school facilities, including classrooms, on-site office space at a school, central support and administrative facilities, interim housing, furniture, equipment, technology, busses, and transportation facilities needed by School District in order to serve the student population to be generated as a result of development of the property within the CFD , and also includes costs associated with the maintenance and operation of school facilities in accordance with the Act.
(n) “School Fee Fund” means the fund(s), account(s) or sub-account(s) of the CFD (regardless of its designation within the Bond Resolution) into which a portion of the Bond Proceeds may be deposited in accordance with the Bond Resolution to finance the School Facilities. (o) “State” means the State of California.
(p) “Special Taxes” means the special taxes authorized to be levied and collected pursuant to the Rate and Method.
ARTICLE II
FORMATION OF THE CFD AND ISSUANCE OF BONDS
Section 2.1. Formation of the CFD.
The City, pursuant to the written request of the Property Owner, has initiated proceedings pursuant to the Act for the formation of the CFD, the authorization of the Special Taxes within the CFD and the authorization of Bonds on behalf of the CFD, with the qualified electors for approval of the levy of the Special Taxes and the sale of the Bonds.
Section 2.2. Issuance and Sale of Bonds.
The City Council of the City, acting as the legislative body of the CFD, may, in its sole discretion, in accordance with its adopted policies, adopt the Bond Resolution and issue the Bonds.
Within 30 days of the issuance of a series of Bonds, Property Owner shall notify School District of the estimated amount of proceeds to be deposited in the School Fee Fund.
If and when the City determines it will issue Bonds, it shall take such actions necessary in its reasonable discretion and in accordance with the terms of the Rate and Method to ensure that the total effective tax rate for completed homes within the CFD does not exceed 2%.
The Bonds shall be issued only if, in its sole discretion, the City Council of the City determines that all requirements of State and Federal law and all the City policies have been satisfied or have been Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 141
Menifee Mayor and City Council May 18, 2022
4 waived by the City. Nothing in this Agreement shall confer upon the School District or any owner of the Property, including the Property Owner, a right to compel the issuance of the Bonds or the disbursement of Bond Proceeds to fund School Facilities except in accordance with the terms of this Agreement.
Section 2.3. Bond Proceeds.
In the event that Bonds are issued, the City, or the CFD (as may be applicable), and Property Owner shall determine the amount of Bond Proceeds to be deposited into the School Fee Fund or any applicable accounts or subaccounts thereof. Nothing herein shall conflict with or supersede the Mitigation Agreement; however, School District agrees that Mitigation Payments made pursuant to the Mitigation Agreement shall be considered Deposits and subject to reimbursement pursuant to Section
2.4(a) of this Agreement. The purpose of this Agreement is to provide a mechanism by which the CFD may levy Special Taxes and issue Bonds to provide a source of funds to finance the School Facilities.
Section 2.4. Disbursements for School Facilities.
(a) From time to time following the funding of the School Fee Fund, School District may notify the City in writing and request a disbursement from the School Fee Fund to fund School Facilities of an amount equal to all Deposits, or portion thereof, up to the amount on deposit in the School Fee Fund, by executing and submitting an executed Disbursement Request to the City.
Upon receipt of such Disbursement Request completed in accordance with the terms of this Agreement, the CFD shall wire transfer or otherwise pay to School District such requested funds to the extent that Bond Proceeds are available in the School Fee Fund for such purpose. Upon School District’s receipt of Bond Proceeds pursuant to such Disbursement Request, all Deposits shall be returned to Property Owner up to the amount of Bond Proceeds received by School District, and Mitigation Payments for all dwelling units for which such Deposits were returned shall be deemed fully satisfied. (b) School District agrees that prior to submitting a Disbursement Request requesting payment from the CFD, it shall review and approve all costs included in its request and will either have already paid or incurred such costs of School Facilities from its own funds subsequent to the date of this Agreement, or will disburse such amounts to pay the costs of School Facilities following receipt of funds from the CFD. In the event that School District does not disburse any Bond Proceeds received by it to third parties within five banking days of receipt, it will trace and remit to the CFD all earnings, if any, earned by School District, from the date of receipt of such Bond Proceeds by School District to the date of expenditure by School District for capital costs of the School Facilities. School District agrees that in processing the above disbursements it will comply with all legal requirements for the expenditure of Bond Proceeds under the Internal Revenue Code of 1986 and any amendments thereto. As a condition to receiving any proceeds of the Bonds, the School District agrees that it shall provide to the CFD, a certificate confirming the representations contained in Sections 2.4 and 4.1 hereof and such other matters as the CFD may reasonably request upon which the CFD and its bond counsel may rely in connection with the issuance of such Bonds and their conclusion that interest on such Bonds is not included in gross income for federal income tax purposes.
Section 2.5. Responsibility for Mitigation Payments.
(a) The Parties hereto acknowledge and agree that the final responsibility for the payment of the Mitigation Payments lies with Property Owner.
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 142
Menifee Mayor and City Council May 18, 2022
5 (b) If the amounts derived from Bond Proceeds for School Facilities deposited in the School Fee Fund, including investment earnings thereon, if any, are not sufficient to fund the total cost of the Mitigation Payments, the Parties hereto agree that all responsibility and liability for the amount of such shortfall shall be and remain with Property Owner, and shall not lie with the CFD, School District, or the City.
(c) School District agrees to utilize or apply funds provided to it by the CFD, in accordance with the Act, the Local Agency Special Tax and Bond Accountability Act (described in Section 4.1 hereof), in compliance with the requirements of federal tax law which is necessary in order for interest on the Bonds to be excluded from the gross income of the recipients for federal income tax purposes, and in accordance with other applicable law, and as set forth herein.
Section 2.6. Administration of the CFD.
The City shall have the power and duty to provide for the administration of the CFD, subject to the terms hereof and the Bond Resolution, including employing and compensating all consultants and providing for the various other administration duties set forth in this Agreement. It is understood and agreed by Parties hereto that School District was not or will not be considered a participant in the proceedings relative to formation of the CFD or the issuance of the Bonds, other than as a Party to this Agreement.
ARTICLE III
TERM AND TERMINATION
Section 3.1. Effective Date.
This Agreement shall become effective and of full force and effect as of the date (“Effective Date”) it is approved and executed by the Governing Board of School District, by Property Owner and the City Council of the City, to be confirmed by the execution hereof by the authorized representatives of the Parties hereto.
Section 3.2. Termination.
If the City determines and notifies Property Owner and School District in writing that the CFD is unable to complete the sale of the Bonds, any obligation of the Parties, if any, to finance all or any portion of the Mitigation Payments with CFD Bond Proceeds pursuant to this Agreement shall automatically terminate and be of no further force or effect.
ARTICLE IV
ADDITIONAL GENERAL PROVISIONS
Section 4.1. Recordkeeping; Inspection of Records.
School District hereby agrees to keep and maintain full and accurate records of all amounts, if any, paid to School District for Mitigation Payments and to fund School Facilities (from proceeds of Bonds or otherwise) and investment earnings thereon and the City or the CFD, or the Fiscal Agent on their behalf, hereby agrees to keep and maintain full and accurate records of all amounts, and investment earnings, if any, disbursed to School District from the School Fee Fund. Each Party further Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 143
Menifee Mayor and City Council May 18, 2022
6 agrees to make such records available to any other Party hereto, including Property Owner, during normal business hours upon reasonable prior notice. All such records shall be kept and maintained by the appropriate Party as provided by applicable law and their respective policies. School District and Property Owner agree that they will cooperate with the CFD and the City in providing documentation, reports or other data reasonably required and requested by the City or the CFD in meeting the reporting requirements of the CFD under Sections 50075.1, 50075.3, and 50075.5 and Article 1.5 (commencing with Section 53410) of Chapter 3 of Part 1 of Division 2 of Title 5 of, the Government Code (collectively, the “Local Agency Special Tax and Bond Accountability Act”). School District’s reporting obligations pursuant to this Section shall be limited to providing reports or other data detailing the following: (A) the amount of CFD funds received by School District to fund School Facilities, (B) the amount of such CFD funds deposited in separate funds or accounts of School District reflecting Mitigation Payments and the number of dwelling units for which such Mitigation Payments apply, and (C) School Facilities that have been acquired or constructed, in whole or in part, with CFD funds. School District’s reporting obligation shall terminate when all CFD funds have been disbursed from the School Fee Fund, or from any account or subaccount thereof that has been allocated Bond Proceeds to finance School Facilities, and School District has provided to the City a report for the last disbursement received by School District. If no CFD funds have been received by School District or used to finance School Facilities since the previous report, no report shall be required and the City may rely upon the previous reports.
Section 4.2. Partial Invalidity.
If any part of this Agreement is held to be illegal or unenforceable by a court of competent jurisdiction, the remainder of this Agreement shall be given effect to the fullest extent reasonably possible.
Section 4.3. Successors and Assigns.
Property Owner may assign its rights pursuant to this Agreement to a purchaser of the Property, or any portion thereof, and such purchaser and assignee shall assume the obligations of Property Owner pursuant to this Agreement and to be bound thereby. This Agreement shall be binding upon and inure to the benefit of the successors and assigns of the Parties hereto.
Section 4.4. Notice.
Any notice, payment or instrument required or permitted by this Agreement to be given or delivered to any Party or other person shall be deemed to have been received when personally delivered or upon deposit of the same in the United States Post Office registered or certified, postage prepaid, addressed as follows:
The City: The City of Menifee
29844 Haun Road
Menifee, CA 92530
Attention: Assistant City Manager
With a copy to: Stradling Yocca Carlson & Rauth
660 Newport Center Drive, Suite 1600
Newport Beach, CA 92660
Attn: Brian Forbath, Esq.
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 144
Menifee Mayor and City Council May 18, 2022
7 School District: Menifee Union School District
29775 Haun Road
Menifee, CA 92586
Attention: Assistant Superintendent, Business Services
With a copy to: Fagen Friedman & Fulfrost LLP
1525 Faraday Avenue, Suite 300
Carlsbad, CA 92011
Attention: Kelley Owens, Esq.
Property Owner: Lennar Homes of California, LLC
980 Montecito Dr., Suite 300
Corona, CA 92879
Attn: Geoffrey Smith
Each Party can change its address for delivery of notice by delivering written notice of such change or address to the other Parties within ten (10) calendar days prior to such change.
Section 4.5. Indemnification.
(a) Indemnification by the City and the CFD. The City shall assume the defense of, indemnify and save harmless, School District and its respective officers, employees, and agents, and each and every one of them, from and against all actions, damages, claims, losses, or expenses of every type and description to which they may be subjected or put, by reason of, or resulting from, any act or omission of the City with respect to this Agreement and the issuance of Bonds; provided, however, that the City shall not be required to indemnify any person or entity as to damages resulting from negligence or willful misconduct of such person or entity or their officers, agents, or employees. (b) Indemnification by Property Owner. Property Owner shall assume the defense of, indemnify and save harmless, the City, the CFD, and the School District, their respective officers, employees, and agents, and each and every one of them, from and against all actions, damages, claims, losses, or expenses of every type and description to which they may be subjected or put, by reason of, or resulting from, any act or omission of Property Owner with respect to this Agreement; provided, however, that Property Owner shall not be required to indemnify any person or entity as to damages resulting from negligence or willful misconduct of such person or entity or their officers, agents, or employees.
(c) Indemnification by School District. School District shall assume the defense of, indemnify and save harmless, the City, the CFD and the Property Owner and their respective officers, employees, and agents, and each and every one of them, from and against all actions, damages, claims, losses, or expenses of every type and description to which they may be subjected or put, by reason of, or resulting from, any act or omission of School District with respect to this Agreement, and the financing, design, engineering, and construction of the School Facilities and/or the use of CFD funds by the School District; provided, however, that School District shall not be required to indemnify any person or entity as to damages resulting from negligence or willful misconduct of such person or entity or their officers, agents, or employees.
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 145
Menifee Mayor and City Council May 18, 2022
8 Section 4.6. Captions.
The captions to Sections used herein are for convenience purposes only and are not part of this Agreement.
Section 4.7. Governing Law.
This Agreement shall be governed by, and construed in accordance with, the laws of the State of California applicable to contracts made and performed in said State.
Section 4.8. Entire Agreement.
This Agreement contains the entire agreement between the Parties with respect to the matters provided for herein and supersedes all prior agreements and negotiations between the Parties with respect to the subject matter of this Agreement.
Section 4.9. Amendments.
This Agreement may be amended or modified only in writing executed by the authorized representative(s) of each of the Parties hereto.
Section 4.10. Waiver.
The failure of any Party hereto to insist on compliance within any of the terms, covenants or conditions of this Agreement by any other Party hereto, shall not be deemed a waiver of such terms, covenants or conditions of this Agreement by such other Party, nor shall any waiver constitute a relinquishment of any other right or power for all or any other times.
Section 4.11. Cooperation and Execution of Documents.
The Parties hereto agree to complete and execute any further or additional documents which may be necessary to complete or further the terms of this Agreement.
Section 4.12. Attorneys’ Fees.
In the event of the bringing of any action or suit by any Party against any other Party arising out of this Agreement, the Party in whose favor final judgment shall be entered shall be entitled to recover from the losing Party all costs and expenses of suit, including reasonable attorneys’ fees.
Section 4.13. Exhibits.
The following exhibits attached hereto are incorporated into this Agreement by reference.
Exhibit Description
“A” Property Description
“B” Disbursement Request Form
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 146
Menifee Mayor and City Council May 18, 2022
9 Section 4.14. Signatories.
The signatories hereto represent that they have been appropriately authorized to enter into this Agreement on behalf of the Party for whom they sign.
Section 4.15. Execution in Counterparts.
This Agreement may be executed in counterparts, each of which shall be deemed an original. [Signatures on following page]
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 147
Menifee Mayor and City Council May 18, 2022
S-1
IN WITNESS WHEREOF, the Parties hereto have executed this Joint Community Facilities Agreement as of the day and year written above.
MENIFEE UNION SCHOOL DISTRICT
By:
President of the Board of Education
of the Menifee Union School District
ATTEST:
By:
Clerk of the Board of Education of
the Menifee Union School District
Property Owner:
LENNAR HOMES OF CALIFORNIA, LLC
a California limited liability company
By:
Geoffrey Smith, Vice President
City of Menifee
By:
Rochelle Clayton, Assistant City Manager
ATTEST:
By:
Sarah Manwaring, City Clerk
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 148
Menifee Mayor and City Council May 18, 2022
A-1
EXHIBIT “A”
PROPERTY DESCRIPTION
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 149
Menifee Mayor and City Council May 18, 2022
3 Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 150
Menifee Mayor and City Council May 18, 2022
4 Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 151
Menifee Mayor and City Council May 18, 2022
B-1
EXHIBIT “B”
DISBURSEMENT REQUEST FORM
1. Community Facilities District No. 2022-1 (Quartz Ranch) of the City of Menifee (“CFD No. 2022-1”) is hereby requested to pay from the School Fee Fund, or any applicable account or subaccount thereof, established by CFD No. 2022-1 in connection with its Special Tax Bonds (the “Bonds”) to Menifee Union School District (“MUSD”), as payee, the sum set forth below:
$________________ (the “Requested Amount”)
For Tract No(s). __________________________________ Lot Nos. __________________________________.
2. The Requested Amount is due and payable, has not formed the basis of any prior request or disbursement and is being made with respect to the obligation of the Property to pay Mitigation Payments to MUSD.
3. The Requested Amount is authorized and payable pursuant to the terms of that certain Joint Community Facilities Agreement, dated as of __________, 2022, by and among Menifee Union School District, Lennar Homes of California, LLC, and the City of Menifee (the “JCFA”) and the School Facilities Funding and Mitigation Agreement, by and between the School District and Lennar Homes of California, LLC, as assignee, dated as of March 26, 2019 (the “Mitigation Agreement”). By requisitioning Bond proceeds as described above, MUSD is not passing upon, determining or assuming the tax-exempt status of the Bonds for federal or California income tax purposes.
4. Capitalized undefined terms used herein shall have the meanings ascribed to them in the JCFA.
Date: _______________________________
LENNAR HOMES OF CALIFORNIA, LLC
a California limited liability company
By:
Date: _______________________________
MENIFEE UNION SCHOOL DISTRICT
By: ________________________________________
________________________________________
Item Title: 11.1
Proposed Formation of Community Facilities District No. 2022-1, Quartz Ranch Item Page Number: 152
Menifee Mayor and City Council May 18, 2022
CITY OF MENIFEE
SUBJECT: Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC MEETING DATE: May 18, 2022
TO: Mayor and City Council
PREPARED BY: Kristen Jensen, Financial Analyst
REVIEWED BY: Nick Fidler, Public Works Director
APPROVED BY: Armando G. Villa, City Manager
-------------------------------------------------------------------------------------------------------------------------------
RECOMMENDED ACTION
1. Adopt a Resolution calling an election to annex territory, including Tentative Tract Map (TMM) 31456, located west of Valley Boulevard, south of McCall Boulevard and north of Ridgemoor Boulevard, into City of Menifee Community Facilities District No. 2017-1 (Maintenance Services) ("CFD No. 2017-1" or "CFD"); and
2. Hold a special landowner election and canvass the election; and
3. Adopt a Resolution declaring results of special landowner election; and
4. Introduce an Ordinance amending the Ordinance No. 2017-231 and levying and apportioning the special tax in CFD No. 2017-1.
DISCUSSION
On April 6, 2022, the City Council adopted Resolution No. 22-1135, declaring its intent to annex territory to CFD No. 2017-1 and commence the annexation proceedings for the territory to be annexed, also known as Annexation No. 7. The next step in the annexation proceedings is to hold a public hearing on May 18, 2022, to conduct an election for the landowners and to declare the results of that election.
The area within Annexation No. 7 is included in TTM 31456 and is approximately 160.57 gross acres of vacant residential property within the City. The property is located west of Valley Boulevard, south of McCall Boulevard, and north of Ridgemoor Boulevard, as shown in the attached Project Map. The proposed maintenance services would include items such as landscaping, lighting, street maintenance, street sweeping, water quality improvements, park and trail maintenance, and graffiti abatement. Per the request of RCFC Investments, LLC (“Owner”), Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 1
Menifee Mayor and City Council May 18, 2022
City of Menifee Staff Report
CDF 2017-1 Annex 7 - Enclave
May 18, 2022
9 7
8 the City would establish a rate and method of apportionment and authorize the levy of special taxes on the taxable property within Annexation Area No. 7 to pay for those services. Annexation Area No. 7 would have a maximum annual tax of $996 per residential unit and would be included in CFD No. 2017-1 as “Tax Zone 7.” The maximum annual tax rate is proposed to escalate each year at the greater of Consumer Price Index (CPI) or 2%. There are no maintenance services proposed to be funded by the levy of Special Tax B (Contingent) for Community Facilities District No. 2017-1 Annexation No. 7. RCFC Investments, LLC has agreed to initiate and conduct the CFD annexation proceedings pursuant to the Mello-Roos Act of 1982.
The Owner submitted a "Consent and Waiver" form on file in the City Clerk's Office to:
hold the election and declare election results; and
consent to the shortening of election time requirements; and waive analysis and arguments; and
waive all notice requirements relating to the conduct of the election immediately following the public hearing.
A boundary map entitled "Annexation Map No. 7, Community Facilities District No. 2017-1 (Maintenance Services)" was previously recorded, on April 12, 2022, in Book 88 of Maps of Assessment and Community Facilities Districts at Page 64, in the office of the Riverside County Recorder. Annexing the parcel into CFD No. 2017-1 would cover the costs of maintenance of certain public improvements associated with the development.
STRATEGIC PLAN OBJECTIVE
Responsive and Transparent Community Government
FISCAL IMPACT
The individual property owners in the CFD would be responsible for annual payments of special taxes. It is estimated, upon full completion of the development that there would be an annual collection of special tax revenues of approximately $175,324 to be used to pay for maintenance costs.
On June 1 of each year, every taxable unit for which a building permit has been issued within the boundaries of the CFD, would be subject to the special tax for the ensuing fiscal year. If the anticipated costs of maintaining the facilities in any given fiscal year, prior to buildout of the project, exceeds the special tax revenues available from parcels for which building permits have been issued, then the special tax may also be applied to property within recorded final subdivision maps, as well as other undeveloped property within the boundaries of the CFD.
All costs associated with annexation into the CFD have been borne by the Developer. By annexing into the CFD, the costs of maintaining improvements located within the development would be financed through special taxes levied on the parcels within CFD No. 2017-1 and not through the City’s General Fund.
ATTACHMENTS
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 2
Menifee Mayor and City Council May 18, 2022
City of Menifee Staff Report
CDF 2017-1 Annex 7 - Enclave
May 18, 2022
9 7
8 1. Project Map
2. Resolution Calling the Election
3. Resolution Declaring Election Results
4. Certificate of Registered Voters
5. Ordinance
6. Signed Petition, Waiver and Consent for Annexation
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 3
Menifee Mayor and City Council May 18, 2022
ATTACHMENT #1
PROJECT LOCATION MAP
CFD NO. 2017-1 (MAINTENANCE SERVICES) - ANNEXATION NO. 7
Item Title: 11.2 Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 4
Menifee Mayor and City Council May 18, 2022 Page 485 of 610
1 RESOLUTION NO. 22-__ _
A
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
MENIFEE CALLING AN ELECTION TO SUBMIT TO THE
QUALIFIED ELECTORS THE QUESTION OF LEVYING A
SPECIAL TAX WITHIN THE AREA PROPOSED TO BE
ANNEXED TO COMMUNITY FACILITIES DISTRICT NO. 201 7-1
(MAINTENANCE SERVICES) (ANNEXATION NO. 7), TTM 31456
W
HEREAS, pursuant to the Mello- Roos Community Facilities Act of 1982 ( “Act”), on December 6, 2017, the City Council ( “City Council”) of the City of Menifee (the “City”) approved Resolution No. 17- 658 establishing Community Facilities District No. 2017-1 (Maintenance Services) of the City of Menifee, County of Riverside, State of California ( “CFD No. 2017-1”) for the purpose of levying special taxes on parcels of taxable property therein for the purpose of providing certain services ( “Services”) which are necessary to meet increased demands placed upon the City as a result of the development of said parcels; and W
HEREAS, the City Council called a special election for December 6, 2017, at which the questions of levying a special tax and establishing an appropriations limit with respect to CFD No. 2017-1 were submitted to the qualified electors within CFD No. 2017-1; and W
HEREAS, at a special election held on December 6, 2017, more than two-thirds (⅔) of all votes cast were cast in favor of the levy of a special tax and the establishment of an appropriations limit, as determined by the City Council in Resolution No. 17-658, which was duly adopted on December 6, 2017; and
W
HEREAS, the City Council is authorized by Article 3.5 (commencing with Section 53339) of Chapter 2.5 of Part 1 of Division 2 of Title 5 of the Government Code to annex territory into an existing community facilities district by complying with the procedures set forth in said Article 3.5; and
W
HEREAS, the City Council on April 6, 2022 duly adopted Resolut ion No. 22- 1135 (“Resolution of Intention”) declaring its intention to annex certain territory to the CFD No. 2017-1 and to levy a special tax within that territory to pay for certain services and setting a time and place for the public hearing on the proposed annexation for May 18, 2022; and W
HEREAS, the territory proposed to be annexed is identified in a map entitled “Annexation Map No. 7, Community Facilities District No. 2017-1 (Maintenance Services)” a copy of which was recorded , on April 12, 2022, in Book 88 of Maps of Assessment and Community Facilities Districts at Page 64, in the office of the Riverside County Recorder; and W
HEREAS, pursuant to the Act and the Resolution of Intention, a noticed public hearing was convened by the City Council on May 18, 2022, not earlier than the hour of 6:00 p.m. at the City Hall located at 29844 Haun Road, Menifee, California 92586, at which hearing all interested persons were given the opportunity to appear and be heard on the proposed annexation of said territory to the CFD No. 2017-1 and the levy of special taxes within said territory proposed to be annexed. If and to the extent participation in the May 18, 2022 meeting must occur by teleconference, videoconference, or other electronic means authorized by the Ralph M. Brown Act or an Executive Order of the Governor of California, the means and methods for participating the meeting shall be posted on the Agenda for said meeting, which shall be posted at least 72 hours prior to the meeting on the City of Menifee (www.cityofmenifee.us), and outside of City Hall Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 5
Menifee Mayor and City Council May 18, 2022
2 at 29844 Haun Road, Menifee, California 92586. A copy of the Agenda will be made available upon r
equest to the Menifee City Clerk's office at 951-723-3471; and; W
HEREAS, written protests have not been filed by fifty percent (50%) or more of the registered voters residing within the CFD No. 2017-1, or by fifty percent (50%) or more of the registered voters residing within the territory proposed to be annexed, or by the owners of one- half (½) or more of the area within the CFD No. 2017-1, or by the owners of one-half (½) or more of the territory proposed to be annexed; and
W
HEREAS, the City Council has determined that there are fewer than twelve (12) registered voters residing in the territory proposed to be annexed to the CFD No. 2017-1 and that the qualified electors in such territory are the landowners; and W
HEREAS, on the basis of all of the foregoing, the City Council has determined at this time to call an election to authorize the annexation of territory to the CFD No. 2017-1 and the levying of a special tax as described in Exhibit A attached hereto; and W
HEREAS, the City Council has received a written instrument from each landowner in the territory proposed to be annexed to the CFD No. 2017-1 consenting to the shortening of election time requirements, waiving analysis and arguments, and waiving all notice requirements relating to the conduct of the election; and
W
HEREAS, the City Clerk has concurred with the election date set forth herein.
NO
W, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
MENIFEE, ACTING AS THE LEGISLATIVE BODY OF COMMUNITY FACILITIES DISTRICT NO. 2017-1 ( MAINTENANCE SERVICES) OF THE CITY OF MENIFEE, DETERMINE AND ORDER AS FOLLOWS:
Section 1. Recitals. The foregoing recitals are true and correct.
Section 2. Confirmation of Finding in Resolution of Intention. The City Council reconfirms all of its findings and determinations as set forth in the Resolution of Intention.
Section 3. Findings Regarding Protests. The City Council finds and determines that written protests to the proposed annexation of territory to the CFD No. 2017-1 and the levy of the special tax within such territory are insufficient in number and in amount under the Act, and the City Council hereby further orders and determines that all such protests are hereby overruled.
Section 4. Findings Regarding Prior Proceedings. The City Council finds and determines that all prior proceedings had and taken by the City Council with respect to the annexation of territory to the CFD No. 2017-1 are valid and in conformity with the requirements of the Act.
Section 5. Levy of Special Tax. As stated in the Resolution of Intention, except where funds are otherwise available, subject to the approval of the qualified electors of territory proposed to be annexed to the CFD No. 2017-1 , a special tax sufficient to pay the costs of the Services (including incidental expenses as described in the Resolution of Intention), secured by recordation of a continuing lien against all nonexempt real property in CFD No. 2017-1, will be levied annually in CFD No. 2017-1. The rate and method of apportionment, and manner of collection of the special tax are specified in Exhibit A hereto.
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 6
Menifee Mayor and City Council May 18, 2022
3 Section 6. Apportionment of Tax. The special tax as apportioned to each parcel is based on the cost of making the Services available to each parcel, or other reasonable basis, and is not based on or upon the ownership of real property.
Section 7. Tax Roll Preparation. The office of the Public Works Director, 29844 Haun Road, Menifee, California 92586, is hereby designated as the office that will be responsible for annually preparing a current roll of special tax levy obligations by assessor’s parcel number and that will be responsible for estimating future special tax lev ies pursuant to Government Code section 53340.2. The Public Works Director may cause these functions to be performed by his or her deputies, assistants, or other designated agents.
Section 8. Accountability Measures. Pursuant to Government Code section 50075.1, the City shall create a separate account into which special tax proceeds will be deposited; and the Public Works Director annually shall prepare and file a report with the City Council that will state (a) the amount of funds collected and expended and (b) the status of the Services financed in the CFD No. 2017-1.
Section 9. Special Election; Voting Procedures . The City Council hereby submits the question of levying the special tax within the territory proposed to be annexed to the qualified electors of the territory proposed to be annexed, in accordance with and pursuant to the Act. The special election shall be held on May 18, 2022, and shall be conducted as follows:
(a) Qualified Electors. The City Council hereby determines that the Services are necessary to meet increased demands placed upon the City as a result of development occurring within the boundaries of the territory proposed to be annexed in to CFD No. 2017-1 . Because fewer than twelve registered voters reside within the territory proposed to be annexed to the CFD No. 2017-1 on April 12, 2022 (a date within the 90 days preceding the close of the public hearing on the territory proposed to be annexed to the CFD No. 2017-1), the qualified electors shall be the landowners within the territory proposed to be annexed to the CFD No. 2017-1, and each landowner who was the owner of record at the close of the hearing shall have one vote for each acre or portion of an acre of land that such landowner owns within the territory proposed to be annexed to the CFD No. 2017-1.
(b) Consolidation of Elections; Combination of Propositions on Ballot . The election on the question of levying the special tax and establishing an appropriations limit for the CFD No. 2017-1 shall be consolidated, and the two propositions shall be combined into a single ballot proposition for submission to the voters, as authorized by Government Code Section 53353.5.
(c) Mail Ballot Election . Pursuant to Government Code section 53327.5, the election shall be conducted as a mail ballot election. The City Council hereby ratifies the City Clerk’s delivery of a ballot to each landowner within the territory proposed to be annexed to the CFD No. 2017-1. The City Council hereby ratifies the form of the ballot, which is attached hereto as Exhibit B.
(d) Return of Ballots. The City Clerk shall accept the ballots of the landowners up to 6:00 p.m. on May 18, 2022. The City Clerk shall have available ballots that may be marked at the City Clerk’s office on the election day by voters. Once all qualified electors have voted, the City Clerk may close the election.
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 7
Menifee Mayor and City Council May 18, 2022
4 (e) Canvass of Election. The City Clerk shall commence the canvass of t he returns of the special election as soon as the election is closed (on May 18, 2022, or when all qualified electors have voted) at the City Clerk’s office. At the conclusion of the canvass, the City Clerk shall declare the results of the election.
(f) Declaration of Results . The City Council shall declare the results of the special election following the completion of the canvass of the returns and shall cause to be inserted into its minutes a statement of the results of the special election as ascertained by the canvass of the returns.
Section 10. General Authorization with Respect to the Election. The officers, employees, and agents of the City are hereby authorized and directed to take all actions and do all things which they, or any of them, may deem necessary or desirable to accomplish the purposes of this Resolution and not inconsistent with the provisions hereof. All actions heretofore taken by the officers, employees, and agents of the City that are in conformity with the purposes and intent of this Resolution are hereby ratified, confirmed, and approved in all respects.
Section 11. Filing of Resolution and Map with City Clerk. The City Council hereby directs the City Clerk to file a copy of this Resolution and the annexation map of the boundaries of CFD No. 2017-1 in his/her office.
Section 12. Effective Date. This Resolution shall take effect immediately upon its adoption.
P ASSED AND ADOPTED by the City Council of the City of Menifee at a regular meeting held on this 18th day of May 2022.
A
TTEST: APPROVED:
Stephanie Roseen, Acting City Clerk Bill Zimmerman, Mayor A
PPROVED AS TO FORM:
Jeffrey T. Melching, City Attorney
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 8
Menifee Mayor and City Council May 18, 2022
EXHIBIT A
COMMUNITY FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES)
RATE AND METHOD OF APPORTIONMENT
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 9
Menifee Mayor and City Council May 18, 2022
City of Menifee
Community Facilities District No. 2017‐1 (Maintenance Services) 1 RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX FOR
COMMUNITY FACILITIES DISTRICT NO. 2017‐1 (MAINTENANCE SERVICES) OF THE CITY OF MENIFEE
A Special Tax (the “Special Tax”) shall be levied on and collected from each Assessor’s Parcel (defined below) in Community Facilities District No. 2017‐1 (Maintenance Services) (the “CFD No. 2017‐1” or “CFD”; defined below), in each
Fiscal Year, (defined below), commencing in the Fiscal Year beginning July 1, 2018, in an amount determined by the City Council of the City of Menifee, acting in its capacity as the legislative body of CFD No. 2017‐1, by applying the rate and method of apportionment set forth below. All of the real property in CFD No. 2017‐1, unless exempted by law or by the provisions herein, shall be taxed to the extent and in the manner provided herein.
A. DEFINITIONS
“Acre” or “Acreage” means the land area of an Assessor’s Parcel as shown on any Assessor’s Parcel Map, or if the land area is not shown on the Assessor’s Parcel Map, the land area as shown on the applicable Final Map, or if the area is not shown on the applicable Final Map, the land area shall be calculated by the Administrator.
“Administrative Expenses” means the actual
or reasonably estimated costs directly related to the formation, annexation, and administration of CFD No. 2017‐1 including, but not limited to: the costs of computing the Special Taxes and preparing the annual Special Tax collection schedules (whether by the City or designee thereof or both); the costs to the City, CFD No. 2017‐1, or any designee thereof associated with fulfilling the CFD No. 2017‐1 disclosure requirements; the costs associated with responding to public inquiries regarding the Special Taxes; the costs of the City, CFD No. 2017‐1 or any designee thereof related to an appeal of the Special Tax; and the City's annual administration fees including payment of a proportional share of City overhead and salaries and benefits of any City employees whose duties are related to the administration of CFD No. 2017‐1 and third party expenses related to CFD No. 2017‐1. Administrative Expenses shall also include amounts estimated or advanced by the City or CFD No. 2017‐1 for any other administrative purposes of CFD No. 2017‐1, including attorney's fees and other costs related to commencing and pursuing to completion any foreclosure of delinquent Special Taxes.
“Administrator” means the City Manager of the City of
Menifee, or his or her designee.
“Approved Property” means all Assessor’s Parcels of Taxable Property that are included in a Final Map that was recorded prior to the March 1 preceding the Fiscal Year in which the Special Tax is being levied, and that have not been issued a building permit
on or prior to the June 1 preceding the Fiscal year in
which the special tax is being levied.
“Assessor’s Parcel” means a lot or parcel of land that is identifiable by an Assessor’s Parcel Number by the County Assessor of the County of Riverside.
“Assessor’s Parcel Map” means an
official map of the Assessor of the County designating parcels by Assessor’s Parcel Number.
“Assessor’s Parcel Number” means that identification number assigned to a parcel by the County Assessor of the County.
“Building Square Footage” or “BSF” means the floor area square footage reflected on the original Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 10
Menifee Mayor and City Council May 18, 2022
City of Menifee
Community Facilities District No. 2017‐1 (Maintenance Services) 2 construction building permit issued for construction of a building of Non‐Residential Property and any Building Square Footage subsequently added to a building of such Non‐Residential Property after issuance of a building permit for expansion or renovation of such building.
“Calendar Year” means the period commencing January 1 of any year and ending the following
December 31.
“CFD” or “CFD No. 2017‐1” means the City of Menifee Community Facilities District No. 2017‐1 (Maintenance Services).
“City” means the City of Menifee.
“Contingent Services” means services permitted under the Mello‐Roos Community Facilities Act of 1982 including, without limitation,
those services authorized to be funded by CFD No. 2017‐1 as set forth in the documents adopted by the City Council at the time the CFD was formed to be provided by the City in the event the Administrator makes a determination pursuant to Section C(2) that a Property Owners’ Association fails to adequately provide such services.
“County” means the County of Riverside.
“Developed Property” means all Assessor’s Parcels of Taxable Property for which a building permit for new construction has been issued on or prior to June 1 preceding the Fiscal Year in which the Special Tax is being
levied.
“Exempt Property” means all Assessors’ Parcels designated as being exempt from the Special Tax as provided for in Section G.
“Final Map” means a subdivision of property by recordation of a final map, parcel map, or lot line adjustment, pursuant to the Subdivision Map Act (California Government Code Section 66410 et seq.) or
recordation of a condominium plan pursuant to California Civil Code 1352 that creates individual lots for which building permits may be issued without further subdivision.
“Fiscal Year” means the period from and including July 1 st of any year to and including the following June
30th.
“Land Use Category” or “LUC” means any of the categories contained in Section B hereof to which an Assessor’s Parcel is assigned consistent with the land use approvals that have been received or proposed for the Assessor’s Parcel as of June 1 preceding the Fiscal Year in which the Special Tax is being levied.
“Maximum Special Tax” means either Maximum Special Tax A and/or Maximum Special Tax B (Contingent), as applicable.
“Maximum Special Tax A” means for each Assessor’s Parcel and each Fiscal Year, the maximum Special Tax A, as determined in accordance with Section C below that can be levied on such Assessor’s Parcel in
such Fiscal Year.
“Maximum Special Tax B (Contingent)” means for each Assessor’s Parcel and each Fiscal Year, the maximum Special Tax B (Contingent), as determined in accordance with Section C below that can be levied on such Assessor’s Parcel in such Fiscal Year.
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 11
Menifee Mayor and City Council May 18, 2022
City of Menifee
Community Facilities District No. 2017‐1 (Maintenance Services) 3 “Multi‐Family Residential Property” or “MFR” means any Assessor’s Parcel of Residential Property upon which a building or buildings comprised of attached Residential Units sharing at least one common wall with another unit are constructed or are intended to be constructed.
“Non‐Residential Property” or “NR” means all Assessor's Parcels of Taxable Property for which a building
permit(s) was issued for a non‐residential use. The Administrator shall make the determination if an Assessor’s Parcel is Non‐Residential Property.
“Property Owner’s Association” or “POA” means the property owner’s association or homeowner’s association established to maintain certain landscaping within a Tax Zone.
“Proportionately” means for Taxable Property that is: (i) Developed Property, that the ratio of the actual Special Tax levy to the Maximum Special Tax is the same for all Parcels of Developed Property, (ii) Approved Property, that the ratio of the actual Special Tax levy to the Maximum Special Tax is the same for all Parcels of Approved Property, and (iii) Undeveloped Property that the ratio of the actual Special Tax levy per acre to the Maximum Special Tax per acre is the same for all Parcels of Undeveloped Property.
“Residential Unit” or "RU" means a residential unit that is used or intended to be used as a domicile by
one or more persons, as determined by the Administrator.
“Residential Property” means all Assessor’s Parcels of Taxable Property upon which Residential Units have been constructed or are intended to be constructed or for which building permits have been or may be issued for purposes of constructing one or more Residential Units.
“Service(s)” means services permitted under the Mello‐Roos Community Facilities Act of 1982 including, without limitation, those services authorized to be funded by CFD No. 2017‐1 as set forth in the documents adopted by the City Council at the time the CFD was formed.
“Single Family Residential Property” or “SFR” means any Residential Property other than Multi‐Family Residential Property on an Assessor’s Parcel.
“Special Tax(es)” means the Special Tax A or Special Tax B (Contingent) to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable
Property.
“Special Tax A” means the annual special tax to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property to fund the Special Tax A Requirement.
"Special Tax A Requirement" means for each Tax Zone that amount to be collected in any Fiscal Year to pay
for certain costs as required to meet the needs of such Tax Zone within CFD No. 2017‐1 in both the current Fiscal Year and the next Fiscal Year. The costs to be covered shall be the direct costs for maintenance services including but not limited to (i) maintenance and lighting of parks, parkways, streets, roads and open space, (ii) maintenance and operation of water quality improvements, (iii) public street sweeping, (iv) fund an operating reserve for the costs of Services as determined by the Administrator, and (v) Administrative Expenses. Under no circumstances shall the Special Tax A Requirement include funds for Bonds.
“Special Tax B (Contingent)” means the annual special tax to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property to fund the Special Tax B (Contingent) Requirement, if required.
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 12
Menifee Mayor and City Council May 18, 2022
City of Menifee
Community Facilities District No. 2017‐1 (Maintenance Services) 4 “Special Tax B (Contingent) Requirement” means that amount required in any Fiscal Year, if the POA is unable to maintain the Contingent Service(s) to: (i) pay the costs of Contingent Services incurred or otherwise payable in the Calendar Year commencing in such Fiscal Year; (ii) fund an operating reserve for the costs of Contingent Services as determined by the Administrator; less a credit for funds available to reduce the annual Special Tax B (Contingent) levy as determined by the Administrator.
"Taxable Property" means all Assessor’s Parcels within CFD No. 2017‐1, which are not Exempt Property.
“Taxable Unit” means a Residential
Unit, Building Square Footage, or an Acre.
"Tax Zone" means a mutually exclusive geographic area, within which particular Special Tax rates may be levied pursuant to this Rate and Method of Apportionment of Special Tax. Appendix C identifies the Tax Zone in CFD No. 2017‐1 at formation; additional Tax Zones may be created when property is annexed into the CFD.
"Tax Zone 1" means the specific geographic area identified on the CFD Boundary Map as Tax Zone 1.
"Tract(s)" means an area of land; i) within a subdivision identified by a particular tract number on a Final Map, ii)
identified within a Parcel Map; or iii) identified within lot line adjustment approved for subdivision.
“Undeveloped Property” means, for each Fiscal Year, all Taxable Property not classified as Developed Property or Approved Property.
B. ASSIGNMENT TO LAND USE CATEGORIES
For each Fiscal Year, all Assessor’s Parcels of Taxable Property within CFD No. 2017‐1 shall be classified
as Developed Property, Approved Property, or Undeveloped Property, and shall be subject to the levy of Special Taxes as determined pursuant to Sections C and D below. Assessor’s Parcels of Developed Property and Approved Property shall be classified as either Residential Property or Non‐Residential Property. Residential Property shall be further classified as Single Family Residential Property or Multi‐ Family Residential Property and the number of Residential Units shall be determined by the Administrator.
C. MAXIMUM SPECIAL TAX RATES
For purposes of determining the applicable Maximum Special Tax for Assessor’s Parcels of Developed Property and Approved Property which are classified as Residential Property, all such Assessor’s Parcels shall be assigned the number of Residential Unit(s) constructed or to be constructed thereon as specified in or shown on the building permit(s) issued or Final Map as determined by the Administrator. Once a single family attached or multi‐family building or buildings have been built on an Assessor's Parcel, the Administrator shall determine the actual number of Residential Units contained within the building or buildings, and the Special Tax A levied against the Assessor’s Parcel in the next Fiscal Year shall be calculated by multiplying the actual number of Residential Units by the Maximum Special Tax per Residential Unit for the Tax Zone below or as included in Appendix A as each annexation occurs.
For purposes of determining the applicable Maximum Special Tax for Assessor’s Parcels of Developed Property and Approved Property which are classified as Non‐Residential Property, all such Assessor’s Parcels shall be assigned the number of Building Square Footage or Acres as shown on the Final Map as determined by the Administrator. Once the Administrator determines the actual number of Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 13
Menifee Mayor and City Council May 18, 2022
City of Menifee
Community Facilities District No. 2017‐1 (Maintenance Services) 5 Building Square Footage or Acres for the Assessor’s Parcels, the Special Tax A levied against the Assessor’s Parcel in the next Fiscal Year shall be calculated by multiplying the number of Building Square Footage or Acres by the Maximum Special Tax per Taxable Unit identified for the applicable Tax Zone below or as included in Appendix A as each annexation occurs.
1. Special Tax A
a. Developed Property
(i) Maximum Special Tax A
The Maximum Special Tax A for each Assessor’s Parcel of Developed Property shall be specific to each Tax Zone within the CFD. When additional property is annexed into CFD No. 2017‐1, the rate and method adopted for the annexed property shall reflect the Maximum Special Tax A for the Tax Zones annexed and included in Appendix A. The Maximum Special Tax A for Developed Property for Fiscal Year 2018‐19 within Tax Zone 1 is identified in Table 1 below:
TABLE 1
MAXIMUM SPECIAL TAX A RATES
DEVELOPED PROPERTY
Tax
Zone Tract Land Use Category
Taxable
Unit
Maximum
Special Tax A
1 TR 36299‐1
& PM 9504
Single Family Residential Property RU $158
Multi‐Family Residential Property RU $158
Non‐Residential Property Acre $1,714
(ii) Increase in the Maximum Special Tax A
On each July 1, commencing on July 1, 2019 the Maximum Special Tax A for Developed Property shall increase by i) the percentage increase in the Consumer Price Index (All Items) for Los Angeles ‐ Riverside ‐ Orange County (1982‐84 = 100) since the beginning of the preceding Fiscal Year, or ii) by two percent (2.0%), whichever is greater.
(iii) Multiple Land Use Categories
In some instances, an Assessor's Parcel of Developed Property may contain more than one Land Use Category. The Maximum Special Tax A that can be levied on an Assessor's Parcel shall be the sum of the Maximum Special Tax A that can be levied for each Land Use Category located on that Assessor's Parcel. For an Assessor's Parcel that contains more than one land use, the Acreage of such Assessor's Parcel shall be allocated to each type of property based on the amount of Acreage designated for each land use as determined by reference to the site plan approved for such Assessor's Parcel. The Administrator's allocation to each type of property shall be final.
b. Approved Property
The Maximum Special Tax A for each Assessor’s Parcel of Approved Property shall be specific to each Tax Zone within the CFD. When additional property is annexed into CFD No. 2017‐1, the rate and method adopted for the annexed property shall reflect the Maximum Special Tax A for the Tax Zone annexed and included in Appendix A. The Maximum Special Tax A for Approved Property for Fiscal Year 2018‐19 within Tax Zone 1 is identified in Table 2 below:
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 14
Menifee Mayor and City Council May 18, 2022
City of Menifee
Community Facilities District No. 2017‐1 (Maintenance Services) 6 TABLE 2
MAXIMUM SPECIAL TAX A RATES
APPROVED PROPERTY
Tax
Zone Tract Land Use Category
Taxable
Unit
Maximum
Special Tax A
1 TR 36299‐1
& PM 9504
Single Family Residential Property RU $158
Multi‐Family Residential Property RU $158
Non‐Residential Property Acre $1,714
On each July 1, commencing on July 1, 2019 the Maximum Special Tax A for Approved Property shall increase by i) the percentage increase in the Consumer Price Index (All Items) for Los Angeles ‐ Riverside ‐ Orange County (1982‐84 = 100) since the beginning of the preceding Fiscal Year, or ii) by two percent (2.0%), whichever is greater.
c. Undeveloped Property
The Maximum Special Tax A for each Assessor’s Parcel of Undeveloped Property shall be specific to each Tax Zone within the CFD. When additional property is annexed into CFD No. 2017‐1, the rate and method adopted for the annexed property shall reflect the Maximum Special Tax A for the Tax Zone annexed and included in Appendix A. The Maximum Special Tax A for Undeveloped Property for Fiscal Year 2018‐19 within Tax Zone 1 is identified in Table 3 below:
TABLE 3
MAXIMUM SPECIAL TAX A RATES
UNDEVELOPED PROPERTY
Tax Zone Tracts Taxable Unit Maximum Special Tax A
1 TR 36299‐1
& PM 9504 Acre $1,515
On each July 1, commencing on July 1, 2019 the Maximum Special Tax A for Undeveloped Property shall increase by i) the percentage increase in the Consumer Price Index (All Items) for Los Angeles ‐ Riverside ‐ Orange County (1982‐84 = 100) since the beginning of the preceding Fiscal Year, or ii) by two percent (2.0%), whichever is greater.
2. Special Tax B (Contingent)
The City Council shall levy Special Tax B (Contingent) only in the event the POA defaults in its obligation to maintain the Contingent Services, which default shall be deemed to have occurred, as determined by the Administrator, in each of the following circumstances:
(a) The POA files for bankruptcy;
(b) The POA is dissolved;
(c) The POA ceases to levy annual assessments for the Contingent Services; or (d) The POA fails to provide the Contingent Services at the same level as the City provides similar services and maintains similar improvements throughout the City and within ninety (90) days after written notice from the City, or such longer period permitted by the City Manager, fails to remedy the deficiency to the reasonable satisfaction of the City Council.
a. Developed Property
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 15
Menifee Mayor and City Council May 18, 2022
City of Menifee
Community Facilities District No. 2017‐1 (Maintenance Services) 7 (i) Maximum Special Tax B (Contingent)
The Maximum Special Tax B (Contingent) for each Assessor’s Parcel of Taxable Property is shown in Table 4 and shall be specific to each Tax Zone within the CFD. When additional property is annexed into CFD No. 2017‐1, the rate and method adopted for the annexed property shall reflect the Maximum Special Tax B (Contingent) for the Tax Zones annexed and included in Appendix A. The Maximum Special Tax B (Contingent) for Fiscal Year 2018‐19 within Tax Zone 1 is identified in Table 4 below:
TABLE 4
MAXIMUM SPECIAL TAX B (CONTINGENT) RATES
DEVELOPED PROPERTY
Tax
Zone Tract Land Use Category
Taxable
Unit
Maximum
Special Tax B
(Contingent)
1 TR 36299‐1
& PM 9504
Single Family Residential Property RU $0
Multi‐Family Residential Property RU $0
Non‐Residential Property Acre $0
(ii) Increase in the Maximum Special Tax B (Contingent) On each July 1, commencing on July 1, 2019 the Maximum Special Tax B (Contingent) for Developed Property shall increase by i) the percentage increase in the Consumer Price Index (All Items) for Los Angeles ‐ Riverside ‐ Orange County (1982‐84 = 100) since the beginning of the preceding Fiscal Year, or ii) by two percent (2.0%), whichever is greater.
(iii) Multiple Land Use Categories
In some instances, an Assessor's Parcel of Developed Property may contain more than one Land Use Category. The Maximum Special Tax B (Contingent) that can be levied on an Assessor's Parcel shall be the sum of the Maximum Special Tax B (Contingent) that can be levied for each Land Use Category located on that Assessor's Parcel. For an Assessor's Parcel that contains more than one land use, the Acreage of such Assessor's Parcel shall be allocated to each type of property based on the amount of Acreage designated for each land use as determined by reference to the site plan approved for such Assessor's Parcel. The Administrator's allocation to each type of property shall be final.
b. Approved Property
The Maximum Special Tax B (Contingent) for each Assessor’s Parcel of Approved Property shall be specific to each Tax Zone within the CFD. When additional property is annexed into CFD No. 2017‐ 1, the rate and method adopted for the annexed property shall reflect the Maximum Special Tax B (Contingent) for the Tax Zone annexed and included in Appendix A. The Maximum Special Tax B (Contingent) for Fiscal Year 2018‐19 within Tax Zone 1 is identified in Table 5 below:
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 16
Menifee Mayor and City Council May 18, 2022
City of Menifee
Community Facilities District No. 2017‐1 (Maintenance Services) 8 TABLE 5
MAXIMUM SPECIAL TAX B (CONTINGENT) RATES
APPROVED PROPERTY
Tax
Zone Tract Land Use Category
Taxable
Unit
Maximum
Special Tax B
(Contingent)
1 TR 36299‐1
& PM 9504
Single Family Residential Property RU $0
Multi‐Family Residential Property RU $0
Non‐Residential Property Acre $0
On each July 1, commencing on July 1, 2019 the Maximum Special Tax B (Contingent) for Approved Property shall increase by i) the percentage increase in the Consumer Price Index (All Items) for Los Angeles ‐ Riverside ‐ Orange County (1982‐84 = 100) since the beginning of the preceding Fiscal Year, or ii) by two percent (2.0%), whichever is greater.
c. Undeveloped Property
The Maximum Special Tax B (Contingent) for each Assessor’s Parcel of Undeveloped Property shall be specific to each Tax Zone within the CFD. When additional property is annexed into CFD No. 2017‐ 1, the rate and method adopted for the annexed property shall reflect the Maximum Special Tax B (Contingent) for the Tax Zone annexed and included in Appendix A. The Maximum Special Tax B (Contingent) for Fiscal Year 2018‐19 within Tax Zone 1 is identified in Table 6 below:
TABLE 6
MAXIMUM SPECIAL TAX B (CONTINGENT) RATES
UNDEVELOPED PROPERTY
Tax Zone Tracts Taxable Unit
Maximum Special
Tax B (Contingent)
1 TR 36299‐1
& PM 9504 Acre $0
On each July 1, commencing on July 1, 2019 the Maximum Special Tax B (Contingent) for Undeveloped Property shall increase by i) the percentage increase in the Consumer Price Index (All Items) for Los Angeles ‐ Riverside ‐ Orange County (1982‐84 = 100) since the beginning of the preceding Fiscal Year, or ii) by two percent (2.0%), whichever is greater.
D. METHOD OF APPORTIONMENT OF ANNUAL SPECIAL TAX
1. Special Tax A
Commencing with Fiscal Year 2018‐19 and for each following Fiscal Year, the City Council shall determine the Special Tax A Requirement for each Tax Zone and shall levy the Special Tax A on all Assessor’s Parcels of Taxable Property within such Tax Zone until the aggregate amount of Special Tax A equals the Special Tax A Requirement for such Tax Zone. The Special Tax A shall be levied for each Fiscal Year as follows:
First: The Special Tax A
shall be levied Proportionately on all Assessor’s Parcels of Developed Property up to 100% of the applicable Maximum Special Tax A to satisfy the Special Tax A Requirement;
Second: If additional moneys are needed to satisfy the Special Tax A Requirement after the first step has been completed, the Special Tax A shall be levied Proportionately on each Parcel of Approved Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 17
Menifee Mayor and City Council May 18, 2022
City of Menifee
Community Facilities District No. 2017‐1 (Maintenance Services) 9 Property at up to 100% of the Maximum Special Tax A for Approved Property;
Third: If additional monies are needed to satisfy the Special Tax A Requirement after the first two steps has been completed, the Special Tax A shall be levied Proportionately on all Assessor’s Parcels of Undeveloped Property up to 100% of the Maximum Special Tax A for Undeveloped Property.
2. Special Tax B (Contingent)
Commencing with the first Fiscal Year in which Special Tax B (Contingent) is authorized to be levied and for each following Fiscal Year, the City Council shall determine the Special Tax B (Contingent) Requirement for each Tax Zone, if any, and shall levy the Special Tax on all Assessor’s Parcels of Taxable Property within such Tax Zone until the aggregate amount of Special Tax B (Contingent) equals the Special Tax B (Contingent) Requirement for such Tax Zone. The Special Tax B (Contingent) shall be levied for each Fiscal Year as follows:
First: The Special Tax shall be levied Proportionately on all Assessor’s Parcels of Developed Property up to 100% of the applicable Maximum Special Tax B (Contingent) to satisfy the Special Tax B (Contingent) Requirement;
Second: If additional moneys are needed to satisfy the Special Tax B (Contingent) Requirement after the first step has been completed, the Special Tax B (Contingent) shall be levied Proportionately on each Parcel of Approved Property at up to 100% of the Maximum Special Tax B (Contingent) for Approved Property;
Third: If additional monies are needed to satisfy the Special Tax B (Contingent) Requirement after the first two steps has been completed, the Special Tax B (Contingent) shall be levied Proportionately on all Assessor’s Parcels of Undeveloped Property up to 100% of the Maximum Special Tax B (Contingent) for Undeveloped Property.
E. FUTURE ANNEXATIONS
It is anticipated that additional properties will be annexed to CFD No. 2017‐1 from time to time. As each
annexation is proposed, an analysis will be prepared to determine the annual cost for providing Services to such properties. Based on this analysis, any properties to be annexed, pursuant to California Government Code section 53339 et seq. will be assigned the appropriate Maximum Special Tax rates for the Tax Zone when annexed and included in Appendix A.
F. DURATION OF SPECIAL TAX
For each Fiscal Year, the Special Tax A shall be levied as long as the Services are being provided.
For each Fiscal Year, the Special Tax B (Contingent) shall be levied as long as the Contingent Services are being provided.
G. EXEMPTIONS
The City shall classify as Exempt Property within CFD No. 2017‐1, all Assessor’s; (i) which are owned by, irrevocably offered for dedication, encumbered by or restricted in use by any public entity; (ii) with public or utility easements making impractical their utilization for other than the purposes set forth in the easement; (iii) which are privately owned but are encumbered by or restricted solely for public uses; or (iv) which are in use in the performance of a public function as determined by the Administrator.
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 18
Menifee Mayor and City Council May 18, 2022
City of Menifee
Community Facilities District No. 2017‐1 (Maintenance Services) 10 H. APPEALS
Any property owner claiming that the amount or application of the Special Taxes are not correct may file a written notice of appeal with the City not later than twelve months after having paid the first installment of the Special Tax that is disputed. The Administrator of CFD No. 2017‐1 shall promptly review the appeal, and if necessary, meet with the property owner, consider written and oral evidence regarding the amount of the Special Tax, and rule on the appeal. If the Administrator’s decision requires that the Special Tax for an Assessor’s Parcel be modified or changed in favor of the property owner, a cash refund shall not be made, but an adjustment shall be made to the Special Tax on that Assessor’s Parcel in the subsequent Fiscal Year(s).
I. MANNER OF COLLECTION
The Special Tax shall be collected in the same manner and at the same time as ordinary ad valorem property taxes, provided, however, that CFD No. 2017‐1 may collect the Special Tax at a different time or in a different manner if necessary to meet its financial obligations.
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 19
Menifee Mayor and City Council May 18, 2022
City of Menifee
Community Facilities District No. 2017‐1 (Maintenance Services) 11 APPENDIX A
CITY OF MENIFEE
COMMUNITY FACILITIES DISTRICT NO. 2017‐1 (MAINTENANCE SERVICES)
COST ESTIMATE
Special Tax A Services ‐ The estimate breaks down the costs of providing one year's maintenance services for Fiscal Year 2022‐23. These services are being funded by the levy of Special Tax A for Community Facilities District No. 2017‐1 Tax Zone 7.
TAX ZONE 7 (SERVICES)
TTM 31456
Item Description Estimated Cost
1 Landscaping $45,315
2 Lighting $19,763
3 Streets $34,883
4 Drainage $22,611
5 Parks $33,412
6 Trails $1,000
7 Graffiti $503
8 Reserves $9,828
9 Administration $8,009
Total $175,324
Special Tax B Contingent Services ‐ The estimate breaks down the costs of providing one year's contingent maintenance services for Fiscal Year 2022‐23. There are no maintenance services proposed to be funded by the levy of Special Tax B (Contingent) for Community Facilities District No. 2017‐1 Tax Zone 7.
TAX ZONE 7
FY 2022‐23 MAXIMUM SPECIAL TAX RATES
Land Use
Category
Taxable
Unit
Maximum
Special Tax A
Maximum
Special Tax B
Developed RU $996 $0
Approved RU $996 $0
Undeveloped Acre $4,255 $0
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 20
Menifee Mayor and City Council May 18, 2022
City of Menifee
Community Facilities District No. 2017‐1 (Maintenance Services) 12 MAXIMUM SPECIAL TAXES ASSIGNED TO EACH TAX ZONE
Tax
Zone
Fiscal
Year
Included Tract
No. of
Taxable
Units
Land Use
Category
Taxable
Unit
Maximum
Special Tax
A
Maximum
Special Tax B
(Contingent) Subdivider
1 2018‐19 36299‐1 &
PM 9504
426 SFR RU $158 $0 Stark Menifee Land, LLC
548 MFR RU $158 $0 Stark Menifee Land, LLC &
Menifee Multifamily, LLC
27.68 NR Acre $1,714 $0 Several
2 2020‐21 TR 37576 65 SFR RU $539 $43 Meritage Homes 3 2020‐21 TR 28859 161 SFR RU $727 $0 Woodside O5S 4 2020‐21 TTM 31098 258 SFR RU $878 $0 Lennar Homes of California, Inc.
5 2020‐21 TTM 36852 68 SFR RU $642 $151 Strata Holland, LLC 6 2021‐22 TTM 37668 175 SFR RU $765 $295
Meritage Homes of
California, Inc.
7 2022‐23 TTM 31456 176 SFR RU $996 $0 RCFC Investments, LLC 8 2021‐22
TR 32102 &
TR 32102‐1 256 SFR RU $674 $0
Diamond Brother Five
Partnership, LP and Pulte
Home Company, LLC
9 2021‐22 TTM 37400 174 SFR RU $703 $0
D.R.Horton Los Angeles
Holding Company, Inc.
10 To Be Determined
11 To Be Determined
12 2022‐23
TR 37408 &
TR 37409 1,022 SFR RU $963 $5 BLC Fleming LLC
ESCALATION OF MAXIMUM SPECIAL TAXES
On each July 1, commencing on July 1, 2019 the Maximum Special Tax shall increase by i) the percentage increase in the Consumer Price Index (All Items) for Los Angeles ‐ Riverside ‐ Orange County (1982‐84 = 100) since the beginning of the preceding Fiscal Year, or ii) by two percent (2.0%), whichever is greater.
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 21
Menifee Mayor and City Council May 18, 2022
City of Menifee
Community Facilities District No. 2017‐1 (Maintenance Services) 13 APPENDIX B
CITY OF MENIFEE
COMMUNITY FACILITIES DISTRICT NO. 2017‐1 (MAINTENANCE SERVICES) DESCRIPTION OF AUTHORIZED SERVICES
The services which may be funded with proceeds of the special tax of CFD No. 2017‐1, as provided by Section 53313 of the Act, will include all costs attributable to maintaining, servicing, cleaning, repairing and/or replacing landscaped areas (may include reserves for replacement) in public street right‐of‐way, public landscaping, public open spaces and other similar landscaped areas officially dedicated for public use. These services including the following:
(a) maintenance and lighting of parks, parkways, streets, roads and open space, which maintenance and lighting services may include, without limitation, furnishing of electrical power to street lights; repair and replacement of damaged or inoperative light bulbs, fixtures and standards; maintenance (including irrigation and replacement) of landscaping vegetation situated on or adjacent to parks, parkways, streets, roads and open space; maintenance and repair of irrigation facilities; maintenance of public signage; graffiti removal from and maintenance and repair of public structures situated on parks, parkways, streets, roads and open space; maintenance and repair of playground or recreation program equipment or facilities situated on any park; and
(b) maintenance and operation of water quality improvements which include storm drainage and flood protection facilities, including, without limitation, drainage inlets, catch basin inserts, infiltration basins, flood control channels, fossil fuel filters, and similar facilities. Maintenance services may include but is not limited to the repair, removal or replacement of all or part of any of the water quality improvements, fossil fuel filters within the public right‐of‐way including the removal of petroleum hydrocarbons and other pollutants from water runoff, or appurtenant facilities, clearing of inlets and outlets; erosion repairs; and cleanup to improvements, and other items necessary for the maintenance and servicing of the water quality basin improvements within flood control channel improvements; and
(c) public street sweeping, on the segments of the arterials within the boundaries of CFD No. 2017‐1; as well as local roads within residential subdivisions located within CFD No. 2017‐1; and any portions adjacent to the properties within CFD No. 2017‐1;
and
In addition to payment of the cost and expense of the forgoing services, proceeds of the special tax may be expended to pay “Administrative Expenses,” as said term is defined in the Rate and Method of Apportionment.
The above services may be financed by proceeds of the special tax of CFD No. 2017‐1 only to the extent that
they are in addition to those provided in the territory of CFD No. 2017‐1 before CFD No. 2017‐1 was created or those provided in the territory annexed to CFD No. 2017‐1 before the territory was annexed, as applicable.
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 22
Menifee Mayor and City Council May 18, 2022
City of Menifee
Community Facilities District No. 2017‐1 (Maintenance Services) 14 APPENDIX C
CITY OF MENIFEE
COMMUNITY FACILITIES DISTRICT NO. 2017‐1 (MAINTENANCE SERVICES) PROPOSED BOUNDARIES
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 23
Menifee Mayor and City Council May 18, 2022
Item Title: 11.2 Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 24
Menifee Mayor and City Council May 18, 2022 Page 505 of 610
Item Title: 11.2 Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 25
Menifee Mayor and City Council May 18, 2022 Page 506 of 610
EXHIBIT B
SPECIAL ELECTION BALLOT
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 26
Menifee Mayor and City Council May 18, 2022
CITY OF MENIFEE
COUNTY OF RIVERSIDE, STATE OF CALIFORNIA
COMMUNITY FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES) ANNEXATION NO. 7
(May 18, 2022)
This ballot is for the use of the authorized representative of the following owner of land within Community Facilities District No. 2017-1 (Maintenance Services) (“CFD No. 2017-1”) of the City of Menifee:
Name of Landowne
r Number of Acres Owned Total Votes
RCFC Investments, LLC 160.57 161
According to the provisions of the Mello-Roos Community Facilities Act of 1982, and resolutions of the City Council (the “Council”) of the City of Menifee (the “City”), the above-named landowner is entitled to cast the number of votes shown above under the heading “Total Votes,” representing the total votes for the property owned by said landowner. The City has sent the enclosed ballot to you so that you may vote on whether or not to approve the special tax.
This special tax ballot is for the use of the property owner of the parcels identified below, which parcels are located within the territory proposed to be annexed to the CFD No. 2017-1, City of Menifee, County of Riverside, State of California. Please advise the City Clerk, at (951) 672-6777 if the name set forth below is incorrect or if you are no longer one of the owners of these parcels.
This special tax ballot may be used to express either support for or opposition to the proposed special tax. To be counted, this special tax ballot must be signed below by the owner or, if the owner is not an individual, by an authorized representative of the owner. The ballot must then be delivered to the City Clerk, either by mail or in person, as follows:
Mail
Delivery: If by mail, place ballot in the return envelope provided, and mail no later than May 4, 2022, two calendar weeks prior to the date set for the election. Mailing later than this deadline creates the risk that the special tax ballot may not be received in time to be counted.
Personal
Delivery: If in person, deliver to the City Clerk at any time up to 5:00 p.m. on May 18, 2022, at the Clerk’s office at 29844 Haun Road, City of Menifee, CA 92586.
However delivered, this ballot must be received by the Clerk prior to the close of the public meeting on May 18, 2022.
Very truly yours,
Sarah Manwaring
City Clerk
City of Menifee
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 27
Menifee Mayor and City Council May 18, 2022
TO CAST THIS BALLOT, PLEASE RETURN THIS ENTIRE PAGE.
OFFICIAL SPECIAL TAX BALLOT
Name & Address of Property Owner: Assessor’s Parcel Number(s):
RCFC Investments, LLC
Attn: Gordon Youde
26071 Merit Circle, Suite 101
Laguna Hills, CA 92653
339-020-004, 339-020-005, 339-020-006,
339-020-007, 339-020-008, 339-020-040,
339-020-041, 339-020-042, 339-020-043,
339-030-022
CITY OF MENIFEE
COUNTY OF RIVERSIDE, STATE OF CALIFORNIA
COMMUNITY FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES)
AN “X” OR OTHER MARK WILL CAST ALL VOTES ASSIGNED TO THIS BALLOT
SPECIAL TAX BALLOT MEASURE MARK “YES” OR “NO”
WITH AN “X”:
Shall the City Council of the City of Menifee be authorized to levy a special tax on an annual basis at the rates and apportioned as described in Exhibit B to the Resolution Declaring its Intention to Annex territory to Community Facilities District No. 2017-1 (Maintenance Services) adopted by the City Council on April 6, 2022 (the “Resolution”), which is incorporated herein by this reference, within the territory identified on the map entitled “Annexation Map No. 7 of Community Facilities District No. 2017-1 (Maintenance Services) City of Menifee” to finance certain services as set forth in Section 5 to the Resolution (including incidental expenses), and shall an appropriation limit be established for the Community Facilities District No. 2017-1 (Maintenance Services) in the amount of special taxes collected?
YES _________
NO _________
Certification for Special Election Ballot
The undersigned is an authorized representative of the above-named landowner and is the person legally authorized and entitled to cast this ballot on behalf of the above-named landowner.
I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct, and that this declaration is executed on ____________, 20__.
RCFC Investments, LLC
Gordon Youde
Manager
Signature
Print Name
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 28
Menifee Mayor and City Council May 18, 2022
RESOLUTION NO. 22-___
A
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
MENIFEE DECLARING ELECTION RESULTS OF THE
SPECIAL ELECTION HELD ON APRIL 6, 2022 AND ORDERING
THE ANNEXATION OF TERRITORY TO COMMUNITY
FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES)
(ANNEXATION NO. 7), TTM 31456
WHEREAS, the City Council (the “City Council”) of the City of Menifee (the “City”) has heretofore conduc ted proceedings, pursuant to the Mello-R oos Community Facilities Act of 1982 (the “Act”), for the area propos ed to be annexed to Community Fac ilities District No. 2017-1 (Maintenance Serv ices) of the City of Menifee, County of Riverside, State of California (the “CFD No. 2017-1”), including conducting a public hearing purs uant to the Act; and
WHEREAS, at the conc lusion of said public hearing, the City Council adopted a resolution calling a special election for May 18, 2022, and submitting to the qualified electors of the territory proposed to be annexed to the CFD No. 2017-1 the question of levying special taxes on parcels of tax able property therein for the purpose of providing certain services which are necessary to meet increas ed demands placed upon the City as a result of the development of said real property, as provided in the form of the special elec tion ballot attached thereto as Exhibit B; and
WHEREAS, the special elec tion was held on May 18, 2022, and the City Clerk (or, in the absence of the City Clerk, the Acting City Clerk – in either case, the “Clerk”) has duly canvassed the returns of the special election and has filed with the City Council a Certificate of Election Results, dated May 18, 2022, executed by the Clerk, certifying that a completed ballot has been returned to the Clerk for each landowner-v oter(s) eligible to cast a ballot in said special election, with all votes cast as “Yes” votes in favor of the ballot measure, and further certifying on said basis that the special mailed-b allot election was closed.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF MENIFEE:
Section 1. Recitals. The City Counc il finds and determines that the foregoing recitals are true and correct.
Section 2. Approval of Canv ass. The City Council has received, reviewed, and hereby accepts the Clerk ’s Certificate of Election Results, a copy of which is attached hereto as Exhibit A , and hereby ratifies, confirms, and approves said Certificate of Election Results.
Section 3. Ballot Measure. The City Council hereby finds, determines, and declares that more than two-thirds (⅔) of all the votes cast at the special election on the ballot measure were in favor of the ballot measure, the ballot measure passed, and the ballot measure was approved by the qualified electors in accordance with the Act.
Section 4. Validity of Procedures
. The City Counc il hereby finds and determines that all prior proceedings and actions taken by the City Council pursuant to the Ac t were and are valid and in conformity with the Act.
Section 5. Annexation. The City Council hereby finds, determines, and declares that pursuant to Gov ernment Code section 53339.8, the territory proposed to be annexed is added to and part of the CFD No. 2017-1 with full legal effect, and the City Council is also authorized,
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 29
Menifee Mayor and City Council May 18, 2022
pursuant to said Section 53339.8, to annually levy special taxes within the annexed territory to pay the costs of the services to be provided by the CFD No. 2017 -1 as specified in Resolution No. 22- 1135 adopted by the City Council on April 6, 2022. The boundaries of the annexed territory are shown on the map entitled, “Annexation Map No. 7 Community Facilities District No. 2017-1 (Maintenance Services)” a copy of which was recorded, on April 12, 2022, in Book 88 of Maps of Assessment and Community Facilities Districts at Page 64 , in the office of the Riverside County Recorder.
Section 6. Notice of Special Tax Lien. Pursuant to Government Code section 53339.8 and Streets and Highways Code sections 3114.5 and 3117.5, within fifteen (15) days of the adoption of this Resolution, the City Clerk shall cause to be filed with the County Recorder of the County of Riverside an amendment to the notice of special tax lien and a map of the amended boundaries of the CFD No. 2017-1 including the annexed territory.
Section 7. Effective Date. This Resolution shall take effect immediately upon its adoption.
PASSED AND ADOPTED by the City Council of the City of Menifee at a regular meeting held on this 18th day of May 2022 by the following vote:
A
TTEST: APPROVED:
Stephanie Roseen, Acting City Clerk Bill Zimmerman, Mayor A
PPROVED AS TO FORM:
Jeffrey T. Melching, City Attorney
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 30
Menifee Mayor and City Council May 18, 2022
E
XHIBIT A
CERTIFICATE OF ELECTION RESULTS
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 31
Menifee Mayor and City Council May 18, 2022
EXHIBIT A
CITY OF MENIFEE
COMMUNITY FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES) ANNEXATION NO. 7
CERTIFICATE OF ELECTION RESULTS
I, the undersigned, being the City Clerk or the Acting City Clerk, as the case may be, hereby certify:
In connection with the special mailed-ballot election called by the City Council (the “City Council”) of the City of Menifee (the “City”) on this same date in the proceedings of the City Council for the above -entitled community facilities district, I personally received (a) signed and dated waiver and consent form s and (b) signed, dated and marked election ballot s on behalf of the property owners, the entities named as the sole landowners of the lands within the boundary of the above-entitled community facilities district in the Certificate Regarding Registered Voters and Landowners, dated April 12, 2022 and on file in the office of the City Clerk of the City in connection with the City Council actions on that date. Copies of the completed waiver and consent form and the completed ballot received by me and on file in my office are attached hereto.
Following such receipt, I have personally, and in the presence of all persons present, reviewed the ballot to confirm that it is properly marked and signed, and I hereby certify the result of that count to be that the ballot was cast in favor of the measure.
Based upon the foregoing, all votes that were cast having been cast “Yes”, in favor of the ballot measure, the measure has therefore passed.
Qualified
Landowner Votes Votes Cast YES NO
161 161
I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct and that this declaration is executed on May 18, 2022.
Sarah Manwaring
City Clerk
City of Menifee
By:
(Attach completed copies of Waiver/Consent and Ballot)
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 32
Menifee Mayor and City Council May 18, 2022
EXHIBIT B
SPECIAL ELECTION BALLOT
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 33
Menifee Mayor and City Council May 18, 2022
CITY OF MENIFEE
COUNTY OF RIVERSIDE, STATE OF CALIFORNIA
COMMUNITY FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES) ANNEXATION NO. 7
(May 18, 2022)
This ballot is for the use of the authorized representative of the following owner of land within Community Facilities District No. 2017-1 (Maintenance Services) (“CFD No. 2017-1”) of the City of Menifee:
Name of Landowne
r Number of Acres Owned Total Votes
RCFC Investments, LLC 160.57 161
According to the provisions of the Mello-Roos Community Facilities Act of 1982, and resolutions of the City Council (the “Council”) of the City of Menifee (the “City”), the above-named landowner is entitled to cast the number of votes shown above under the heading “Total Votes,” representing the total votes for the property owned by said landowner. The City has sent the enclosed ballot to you so that you may vote on whether or not to approve the special tax.
This special tax ballot is for the use of the property owner of the parcels identified below, which parcels are located within the territory proposed to be annexed to the CFD No. 2017-1, City of Menifee, County of Riverside, State of California. Please advise the City Clerk, at (951) 672-6777 if the name set forth below is incorrect or if you are no longer one of the owners of these parcels.
This special tax ballot may be used to express either support for or opposition to the proposed special tax. To be counted, this special tax ballot must be signed below by the owner or, if the owner is not an individual, by an authorized representative of the owner. The ballot must then be delivered to the City Clerk, either by mail or in person, as follows:
Mail
Delivery: If by mail, place ballot in the return envelope provided, and mail no later than May 4, 2022, two calendar weeks prior to the date set for the election. Mailing later than this deadline creates the risk that the special tax ballot may not be received in time to be counted.
Personal
Delivery: If in person, deliver to the City Clerk at any time up to 5:00 p.m. on May 18, 2022, at the Clerk’s office at 29844 Haun Road, City of Menifee, CA 92586.
However delivered, this ballot must be received by the Clerk prior to the close of the public meeting on May 18, 2022.
Very truly yours,
Sarah Manwaring
City Clerk
City of Menifee
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 34
Menifee Mayor and City Council May 18, 2022
TO CAST THIS BALLOT, PLEASE RETURN THIS ENTIRE PAGE.
OFFICIAL SPECIAL TAX BALLOT
Name & Address of Property Owner: Assessor’s Parcel Number(s):
RCFC Investments, LLC
Attn: Gordon Youde
26071 Merit Circle, Suite 101
Laguna Hills, CA 92653
339-020-004, 339-020-005, 339-020-006,
339-020-007, 339-020-008, 339-020-040,
339-020-041, 339-020-042, 339-020-043,
339-030-022
CITY OF MENIFEE
COUNTY OF RIVERSIDE, STATE OF CALIFORNIA
COMMUNITY FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES)
AN “X” OR OTHER MARK WILL CAST ALL VOTES ASSIGNED TO THIS BALLOT
SPECIAL TAX BALLOT MEASURE MARK “YES” OR “NO”
WITH AN “X”:
Shall the City Council of the City of Menifee be authorized to levy a special tax on an annual basis at the rates and apportioned as described in Exhibit B to the Resolution Declaring its Intention to Annex territory to Community Facilities District No. 2017-1 (Maintenance Services) adopted by the City Council on April 6, 2022 (the “Resolution”), which is incorporated herein by this reference, within the territory identified on the map entitled “Annexation Map No. 7 of Community Facilities District No. 2017-1 (Maintenance Services) City of Menifee” to finance certain services as set forth in Section 5 to the Resolution (including incidental expenses), and shall an appropriation limit be established for the Community Facilities District No. 2017-1 (Maintenance Services) in the amount of special taxes collected?
YES _________
NO _________
Certification for Special Election Ballot
The undersigned is an authorized representative of the above-named landowner and is the person legally authorized and entitled to cast this ballot on behalf of the above-named landowner.
I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct, and that this declaration is executed on ____________, 20__.
RCFC Investments, LLC
Gordon Youde
Manager
Signature
Print Name
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 35
Menifee Mayor and City Council May 18, 2022
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 36
Menifee Mayor and City Council May 18, 2022
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ORDINANCE NO. 2022-___
AN ORDINANCE AMENDING ORDINANCE NO. 2017-231 AND
LEVYING SPECIAL TAXES TO BE COLLECTED DURING FISCAL
YEAR 2022-23 TO PAY THE ANNUAL COSTS OF THE MAINTENANCE
AND SERVICING OF STREET LIGHTS, PARKS, PARKWAYS,
STREETS, ROADS, AND OPEN SPACE, THE OPERATION AND
MAINTENANCE OF STORM DRAINAGE SYSTEMS, A RESERVE
FUND FOR CAPITAL REPLACEMENT, AND ADMINISTRATIVE
EXPENSES WITH RESPECT TO CITY OF MENIFEE COMMUNITY
FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES)
(ANNEXATION NO. 7)
WHEREAS, pursuant to the Mello-Roos Community Facilities Act of 1982 (the “Act”), on December 6, 2017, the City Council (the “City Council”) of the City of Menifee (the “City”) adopted Resolution No. 17- 658 establishing Community Facilities District No. 2017-1 (Maintenance Services) of the City of Menifee, County of Riverside, State of California (the "CFD No. 2017-1") for the purpose of levying special taxes on parcels of taxable property therein for the pNurpose of providing certain services (the “Services”), which are necessary to meet increased demands placed upon the City and are described in Exhibit A attached hereto; and
WHEREAS, on December 20, 2017, the City Council adopted Ordinance No. 2017-231 entitled, “An Ordinance Levying Special Taxes to be Collected During Fiscal Year 2018-19 to Pay the Annual Costs of the Maintenance and Servicing of Street Lights, Parks, Parkways, Streets, Roads, and Open Space, the Operation and Maintenance of Storm Drainage Systems, a Reserve Fund for Capital Replacement, and Administrative Expenses with Respect to City of Menifee Community Facilities District No. 2017-1 (Maintenance Services)” (“Ordinance No. 2017-231”), pursuant to which the City Council levied special taxes with the CFD No. 2017-1; and
WHEREAS, on April 6, 2022, the City Council adopted Resolution No. 22-1135 entitled “A Resolution of the City Council of the City of Menifee Declaring Its Intention to Annex Territory to Community Facilities District No. 2017-1 (Maintenance Services) of the City of Menifee, Adopting a Map of the Area to be Proposed to be Annexed (Annexation No. 7) and Authorizing the Levy of a Special Taxes Therein” (the “Resolution of Intention”) declaring its intention to annex certain territory to the CFD No. 2017-1 and to levy special taxes within that territory to provide the Services as described in the Resolution of Intention and setting a special public hearing on the proposed annexation for May 18, 2022; and WHEREAS, notice was published as required by the Act relative to the intention of the City Council to annex certain territory to the CFD No. 2017-1, to levy special taxes therein to provide the Services, and to set the time and place of said public hearing; and
WHEREAS, on May 18, 2022, at the time and place specified in said published notice, the City Council opened and held a public hearing as required by the Act relative to the annexation of territory in to the CFD No. 2017-1, the levy of the special taxes therein, and the provision of Services by the CFD No. 2017-1; and
WHEREAS, at said public hearing all persons desiring to be heard on all matters pertaining to the annexation of territory to the CFD No. 2017-1, the levy of the special taxes therein, and the provision of Services therein were heard, and a full and fair hearing was held; and WHEREAS, subsequent to said public hearing, the City Council adopted Resolution No. 22-___ entitled “A Resolution of the City Council of the City of Menifee Calling an Election to Submit to the Qualified Electors the Question of Levying a Special Tax Within the Area Proposed to be Annexed to Community Facilities District No. 2017-1 (Maintenance Services) (Annexation No. 7)” (the “Resolution Calling the Election”) on May 18, 2022, wherein the City Council submitted the question of levying a special tax in Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 37
Menifee Mayor and City Council May 18, 2022
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territory proposed to be annexed to the CFD No. 2017-1 at the rate and according to the method of apportionment described therein; and
WHEREAS, at said special election on May 18, 2022, the qualified electors of the territory proposed to be annexed to the CFD No. 2017-1 approved said propositions as described in the Resolution Calling the Special Election by more than the two-thirds vote required by the Act; and WHEREAS, subsequent to said special election, the City Council adopted Resolution No. 22-___ entitled “A Resolution of the City Council of the City of Menifee Declaring the Results of the Special Election Held on May 18, 2022, and Ordering the Annexation of Territory to Community Facilities District No. 2017-1 (Maintenance Services) (Annexation No. 7)” wherein the City Council determined that the territory proposed to be annexed was added to the CFD No. 2017-1 (such territory being referred to herein as “Annexation No. 7”).
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF MENIFEE, ACTING AS THE LEGISLATIVE BODY OF COMMUNITY FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES) OF THE CITY OF MENIFEE, DOES ORDAIN AS FOLLOWS:
Section 1.Recitals. The foregoing recitals are true and correct.
Section 2.Amendment to Exhibit B of Ordinance No. 2017-231. Exhibit B of Ordinance No. 2017- 231 is hereby amended by deleting it in its entirety and replacing it with Revised Exhibit B attached hereto.
Section 3.Amendment to Section 2 of Ordinance No. 2017-231. Section 2 of Ordinance No. 2017- 231 is hereby amended by deleting it in its entirety and replacing it with the following:
Section 2.Levy of Special Taxes. Special taxes shall be and are hereby levied for the Fiscal Year 2022-23 and each Fiscal Year thereafter, on all parcels of real property within the Community Facilities District which are subject to taxation, which are identified in Revised Exhibit B attached hereto, and in the amount set forth for each such parcel in said Revised Exhibit B. Pursuant to said Section 53340, such special taxes shall be collected in the same manner as ordinary ad valorem property taxes are collected and shall be subject to the same penalties and the same procedure, sale, and lien priority in case of delinquency as is provided for ad valorem taxes.
Section 4.Future Annexations. The annexation of additional territory into the CFD No. 2017-1 was contemplated as part of the adoption of Resolution No. 17-654. The boundaries of the territory within which any property may annex to the CFD No. 2017-1 are more particularly described and shown on that certain map entitled “Boundaries – Potential Annexation Area Community Facilities District No. 2017-1 (Maintenance Services) of the City of Menifee, County of Riverside, State of California,” as recorded on November 7, 2017 in Book 81 of Maps of Assessment and Community Facilities District, at Page 70, and as Document No. 2017-0465707 in the official records of the County of Riverside. Following a public hearing and the adoption of resolutions required by the Act for any additional annexations of property within said potential annexation area, Revised Exhibit B of Ordinance No. 2017-231 shall be further amended to include any additional territory annexed to the CFD No. 2017-1. The City Council hereby authorizes and directs the officers, employees, and agents of the City to take all actions and do all things which they, or any of them, may deem necessary or desirable to accomplish the purposes of this Section 4 of this Ordinance to further amend Revised Exhibit B of Ordinance No. 2017-231.
Section 5.Severability. If for any reason any portion of this Ordinance is found to be invalid, or if the special taxes found inapplicable to any particular parcel within the CFD No. 2017-1, by a court of competent jurisdiction, the balance of this Ordinance and the application of the special tax to the remaining parcels within the CFD No. 2017-1 shall not be affected.
Item Title: 11.2
Annexation No. 7 to Community Facilities District 2017-1 (Maintenance Services), Enclave by RCFC Investments, LLC Item Page Number: 38
Menifee Mayor and City Council May 18, 2022