CITY OF MENIFEE
SUBJECT: Proposed Bond Issuance for Community Facilities District No. 2025-2, Quartz Trail
MEETING DATE: July 13, 2026
TO: Finance Committee
PREPARED BY: Lauri Lockwood, Financial Analyst
REVIEWED BY: Travis Hickey, Chief Financial Officer
APPROVED BY: Armando G. Villa, City Manager
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RECOMMENDED ACTION
1. Review the proposed bond issuance request for Community Facilities District ("CFD") No. 2025-2, Quartz Trail, by Lennar Homes of California, LLC, to finance the costs of certain public improvements in connection with the development of 80 homes located southeast of Holland Road and Evans Road within the City of Menifee (the "City"); and
2. Recommend the Finance Department proceed with the preparation of the Official Statement and other legal documents related to the transaction for presentation to the City Council.
DISCUSSION
Lennar Homes of California, LLC (the "Developer"), owns a residential tract approved for 80 detached single-family homes within the City. In May 2026, the Developer requested that the City proceed with issuing bonds for CFD No. 2025-2, Quartz Trail (the "Development") to finance eligible public facilities.
As of May 27, 2026, building permits have been issued for all 80 residential lots within the Development. Pursuant to the Rate and Method of Apportionment, 75 lots are classified as Developed Property for the Fiscal Year (FY) 2026/2027 levy because building permits were issued on or before the May 1, 2026, building permit cutoff. The remaining five lots are classified as Approved Property for FY 2026/2027 because their building permits were issued after the May 1 cutoff and are anticipated to become Developed Property for the FY 2027/2028 levy. While only 75 lots are subject to the FY 2026/2027 Developed Property levy, all 80 permitted lots are incorporated into the proposed bond sizing and long-term repayment analysis. Currently, 48 homes have closed escrow, 26 homes are sold and in escrow, and the development is projected to be fully absorbed prior to the proposed bond issuance.
City of Menifee Staff Report
Proposed Bond Issuance for CFD 2025-2, Quartz Trail
July 13, 2026
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Spicer Consulting Group completed a preliminary financing analysis to evaluate the proposed bond issuance. Based on current market assumptions, approximately $5.79 million of Special Tax Bonds could be issued. The proposed financing satisfies the City's bond issuance policies, including an estimated 10.27:1 value-to-lien ratio, an estimated effective property tax rate ranging from 1.82% to 1.84%, and a FY 2025/2026 delinquency rate of 3.36%, each of which falls within the City's adopted financing criteria.
The proposed financing is expected to generate approximately $4.92 million in bond proceeds to reimburse eligible public improvements, including City facilities, development impact fees, the City premium, and EMWD facilities. The total estimated eligible project costs are approximately $6.60 million, with the remaining approximately $1.68 million expected to continue to be funded by the Developer.
The intent is to engage Raymond James & Associates to sell the bonds for this CFD.
Table 1: Summary of CFD 2025-2, Quartz Trail, Activity:
Description Date
Finance Committee CFD Formation Review November 12, 2024 Resolution of Intention February 5, 2025
Resolutions of CFD Formation (City Council
Approval)
April 2, 2025 /
April 16, 2025
FISCAL IMPACT
There is no fiscal impact associated with the recommended action.
ATTACHMENTS
1. CFD 2025-2 Executive Summary
2. CFD 2025-2 Project Map
3. CFD 2025-2 Preliminary Bond Sale Analysis
4. CFD 2025-2 Boundary Map
5. CFD 2025-2 Public Hearing Report
6. CFD 2025-2 Bond Issuance Request