Development Agreement
Amendment No. 1 for Legado
Specific Plan
Finance Committee
October 14, 2025
City of Menifee Community Development Department
City of Menifee Finance Department
Phase 1 Parks & Paseos
1 • By purchasing Phase 1, Lennar assumed all responsibilities of the DA • Maximum developer contribution of $3 million
• Construction of the parks and paseos was delayed for 5 years • A bid review was conducted by a 3rd party and the cost was determined to be $5.8 million, creating a $2.8 million variance
• Fiscal opportunities were identified to close this variance gap • The parks and amenities will be delivered as designed within the Specific Plan
Purpose of the Amendment
2 Cost Estimates
3 • Construction costs have significantly increased since adoption of the DA due to inflation Improvement DA Exhibit F-3
Cost
Lennar
Estimate
Amount over
F-3 Cost
TR37408
Neighborhood Park
West
$700,000 $1,715,166 $1,015,166
TR37408 Paseo Park
West $750,000 $1,416,741 $666,741
TR37409
Neighborhood Park
East
$750,000 $832,087 $82,087
TR37409 Paseo Park
East $800,000 $1,917,681 $1,117,681
Total $3,000,000 $5,881,675 $2,881,675
Proposed Provisions
4 ITEM DA SAVINGS REDUCTION REMAINING
Original Variance - $2,881,676
DIF Freeze Extension ($44,064) $2,837,612
Non-Prevailing Wage for
East Park & Paseo ($763,498) $2,074,114
Phased POC Landscape
Turnover ($345,139) $1,728,975
East Park Restroom
Removal ($237,000) $1,491,975
Contingency Reduction from
15% to 5% ($469,844) $1,022,131
FINANCE COMMITTEE ACTIONS
CFD Bond Premium
Reduction ($219,477) $802,654
ADDITIONAL FISCAL PROVISIONS
Quimby & Park DIF from
Heritage Village TR38346 ($731,025) $71,629
Bond Releases ($50,000) $21,629
New Variance (shortfall) - $21,629
• Proposed amendment provisions for Legado Phase 1
• Extend the DIF freeze for all lots within Phase 1 (491 total) • 81 lots currently fall outside the DIF freeze
• Removal of restroom building from TR 37409 East Park
• Reduces ongoing maintenance costs; park’s intended function is unaffected • Reduce Park Cost Estimate contingency from 15% to 5%
• Adjust thresholds for park & paseo completion
• TR 37408 West Park & Paseo extended from the 140th Certificate of Occupancy to the 200th Certificate of Occupancy
• TR 37409 East Park & Paseo moved up from the 140th Certificate of Occupancy to the 95th Certificate of Occupancy
DA Amendment No. 1
5 • Additional amendment provisions
• Include a definition of “Lennar Phase 1”
• Prepare a Reimbursement Agreement for the Community Facilities District (CFD) Bond premiums
• Prepare a Quimby Agreement for Quimby fee reallocation from Heritage Village TR 38346
• Acceptant of Points of Connection/Right-of-Way (landscape areas) after the 90-day maintenance period
• Expedite bond exoneration efforts for previously completed tracts DA Amendment No. 1
6 Recommendation
• Review the proposed Bond Premium Reimbursement agreement between the City and Lennar for CFD No. 2022-3, Improvement Area 1, and recommend to the City Council for consideration.
7 Questions?
Thank You.