Agenda packet — Ontario City Council, November 7, 2023 (part 2 of 4)

303 East B Street, Ontario, California 91764 Phone: 909.395.2036 / Fax: 909.395.2420

LAND DEVELOPMENT DIVISION

CONDITIONS OF APPROVAL
Da
te Prepared: 7/11/2023 Revised: 8/21/2023
F
ile No: PUD22-004
Re
lated Files: PDEV22-027 and PHP22-015
P
roject Description: A Planned Unit Development (File No. PUD22-004) to establish development standards and design guidelines for the overall 10.6 -acre Project site, in conjunction with a Development Plan (File No. PDEV22 -027) to construct 346 apartment units and 5,400 square feet of commercial space on 9.4 acres of the Project site and a Certificate of Appropriateness (File No.

PHP22-015) to determine whether the Project site is an historic resource. The Project site is located at the northwest corner of Euclid Avenue and Walnut Avenue, within the Mixed Use – Neighborhood Hub 8e – Euclid and Walnut (MU -NH 8e) zoning district ; (APNs: 1051-271-67, 1051- 271-06, and 1051-271-66); submitted by Legacy/Collier Residential LLC.

P
repared By: Alexis Vaughn, Associate Planner
Phone: 909. 395.2416 (direct)
Email: [email protected]
T
he Planning Department, Land Development Section, conditions of approval applicable to the above-described Project are listed below. The Project shall comply with each condition of approval:
1 .0 Standard Conditions of Approval. The Project shall comply with the Standard Conditions for New Development, adopted by City Council Resolution No. 2017-027 on April 18, 2017. A copy of the Standard Conditions for New Development may be obtained from the Planning Department or City Clerk/Records Management Department. 2 .0 Special Conditions of Approval. In additio n to the Standard Conditions for New Development identified in condition no. 1.0, above, t he Project shall comply with the following special conditions of approval:

2.1 Planned Unit Development . The final City Council approval date and ordinance number shall be added to the title page (the October and May dates shall be removed) and the following items submitted to the Planning Department within 30 days following City Council approval of the Planned Unit Development:
(
a) Two copies of the final Euclid Walnut Planned Unit Development document – color, double-sided, and bound; and
(
b) One CD or flash drive containing a complete copy of the final Planned Unit Development document in Microsoft Word and/or its original a nd accessible file format, such as InDesign, and a complete PDF copy of the final document, optimized for the web. 224
Planning Department – Land Development Division
Conditions of Approval
File No.: PUD22-004

Page 2 of 3 ends

2.2 Signs.

(a) All Project signage shall comply with the requirements of Ontario Development Code Division 8.1 (Sign Regulations).

(b) On-site posting of large public notification signs was required for this Project, pursuant to Code Section 2.03.010.C.4, which consists of one or more large, 6- foot-tall, freestanding public notification signs. The signs, which were posted no later than ten calendar days prior to the Planning Commission hearing date, shall be removed no later than fourteen calendar days following the City Council hearing date, unless an extension is required by the Planning Director.

(c) Per the provisions of the Planned Unit Development, a Sign Program shall be submitted for review and approval prior to issuance of building permits for the Project site.

2.3 Sound Attenuation. The Project shall be constructed and operated in a manner so as not to exceed the maximum interior and exterior noise levels set forth in Ontario Municipal Code Title 5 (Public Welfare, Morals, and Conduct), Chapter 29 (Noise).

2.4 Covenants and Lease Agreement Terms.

(a) A current covenant shall be recorded for the properties (generally, Phas e 1 and Phase 2 of the Pro ject site, as described in the Euclid Walnut Planned Unit Development) that provides for reciprocal access between the two properties.

(b) A parking management plan and any lease agreement/terms shall be submitted to the City for review and approval, prior to issuance of a building permit for the Project.

The lease agreement/terms shall include, but not be limited to, the following:

(i) Clauses prohibiting public nuisances, including but not limited to , excessive noise, parking of vehicles on driveways to garages that are less than 18 feet in length, excessive storage of personal items on balconies, and the hanging of personal items over balcony railings (such as clothes lines, towels, etc.); and
(ii) Personal property storage shall not preclude the intended number of vehicles from being parked within the garage. Carports shall not be used for personal property storage but solely vehicle parking.

2.5 Disclosure Statements.

(a) The following information shall be provided to each prospective re nter of the residential units:

(i) This site is subject to noise from the Ontario International Airport and may be more severely impacted in the future.
(ii) Some of the property adjacent to this site is zoned for agricultural uses and there could be fly, odor, or related problems due to the proximity of animals. 225
Planning Department – Land Development Division
Conditions of Approval
File No.: PUD22-004

Page 3 of 3 ends

(iii) The area south of Riverside Drive lies within the San Bernardino County Agricultural Preserve. Dairies current ly existing in that area are likely to remain for the foreseeable future.

2.6 Indemnification. The applicant shall agree to defend, indemnify and hold harmless, the City of Ontario or its agents, officers, and employees from any claim, action or proceeding against the City of Ontario or its agents, officers or employees to attack, set aside, void or annul any approval of the City of Ontario, whether by its City Council, Planning Commission or other authorized board or officer. The City of Ontario shall promptly notify the applicant of any such claim, action or proceeding, and the City of Ontario shall cooperate fully in the defense.

2.7 Additional Fees.

(a) Within 5 days following final application approval, the Notice of Determination (“NOD”) filing fee shall be provided to the Planning Department. The fee shall be paid by check, made payable to the "Clerk of the Board of Supervisors", which shall be forwarded to the San Bernardino County Clerk of the Board of Supervisors, along with all applicable environmental forms/notices, pursuant to the requirements of the California Environmental Quality Act (“CEQA”). Failure to provide said fee within the time specified will result in the extension of the statute of limitations for the filing of a CEQA lawsuit from 30 days to 180 days.

2.8 Related Applications . Planned Unit Development (File No. PUD22 -004) approval shall not be final and complete until such time that related File Nos. PHP22-015 and PDEV22-027 have been approved by the Planning Commission . A Lot Line Adjustment/Lot Merger is also required to be approved prior to issuance of Building Permits, pursuant to Engineering Department conditions of approval.

2.9 Additional Requirements.

(a) In-line tenant spaces shall contain a high -quality food service establishment.
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240
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245

CITY OF ONTARIO

MEMORANDUM
TO: Scott Murphy, Community Development Director (Copy of memo only) Rudy Zeledon, Planning Director (Copy of memo only)
Diane Ayala, Advanced Planning Division (Copy of memo only) Charity Hernandez, Economic Development
James Caro, Building Department
Raymond Lee, Engineering Department
Jamie Richardson, Landscape Planning Division
Dennis Mejia, Municipal Utility Company
Heather Lugo, Police Department
Paul Erhman, Deputy Fire Chief/Fire Marshal
Jay Bautista, Traffic/Transportation Manager
Lorena Mejia, Airport Planning
Jeff Tang, Engineering/NPDES
Angela Magana, Community Improvement (Copy of memo only) Jimmy Chang, IPA Department
Blaine Ishii, Integrated Waste
FROM: Alexis Vaughn, Associate Planner
DATE: May 31, 2023
SUBJECT: FILE #: PUD-22-004 Finance Acct#: PU006
The following project has been resubmitted for review. Please send one (1) copy and email one (1) copy of your DAB report to the Planning Department by .

PROJECT DESCRIPTION: A Planned Unit Development establishing land use designations, and development standards and guidelines, which will govern the development of 10.6 acres of land generally located at the northwest corner of Euclid Avenue and Walnut Street (APNs: 1051-271-67, 1051-271-06, 1051-271-66). Related Files: PDEV22-027, PHP22-015)
The conditions contained in the attached report must be met prior to scheduling for Development Advisory Board.

The plan does not adequately address the departmental concerns.

Standard Conditions of Approval apply
Report attached (1 copy and email 1 copy)
No comments
The plan does adequately address the departmental concerns at this time.

See previous report for Conditions
Department Signature Title Date
Revision #2
246

CITY OF ONTARIO

MEMORANDUM

TO: Alexis Vaughn, Associate Planner
Planning Department

FROM: Paul Ehrman, Sr. Deputy Fire Chief/Fire Marshal
Fire Department

DATE: November 7, 2022

SUBJECT: PUD-22-004 - A Planned Unit Development establishing land use designations, and development standards and guidelines, which will govern the development of 10.6 acres of land generally located at the northwest corner of Euclid Avenue and Walnut Street (APNs: 1051 -271-67, 1051-271- 06, 1051-271-66). Related Files: PDEV22-027, PHP22-015).

The plan does adequately address Fire Department requirements at this time.

No comments.

247
248

CITY OF ONTARIO

The plan does not adequately address the departmental concerns.

Standard Conditions of Approval apply
Report attached (1 copy and email 1 copy)
No comments
The plan does adequately address the departmental concerns at this time.

See previous report for Conditions
Department Signature Title Date
Revision #2
249

AIRPORT LAND USE COMPATIBILITY PLANNING
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Project File No.:

Address:

APN:

Existing Land
Use:

Proposed Land
Use:

Site Acreage:

ONT-IAC Project Review:
$LUSRUW,QÀXHQFH$UHD

This proposed Project is: Exempt from the ALUCP Consistent Consistent with Conditions Inconsistent Reviewed By:

Date:

Contact Info:

Project Planner:

CD No.:

PALU No.:

The project is impacted by the following ONT ALUCP Compatibility Zones:

Safety Noise Impact Airspace Protection 2YHUÀLJKW1RWL¿FDWLRQ Zone 1
Zone 1A
Zone 2
Zone 3
Zone 4
Zone 5
75+ dB CNEL
70 - 75 dB CNEL
65 - 70 dB CNEL
60 - 65 dB CNEL
High Terrain Zone
)$$1RWL¿FDWLRQ6XUIDFHV
Avigation Easement
Dedication
5HFRUGHG2YHUÀLJKW
1RWL¿FDWLRQ
Real Estate Transaction
'LVFORVXUH
Zone 1 Zone 2 Zone 3 Zone 4 Zone 5
$LUSRUW3ODQQHU6LJQDWXUH

CONSISTENCY DETERMINATION
3URSRVHG6WUXFWXUH+HLJKW

Airspace Avigation
Easement Area
Allowable
Height:
$LUVSDFH2EVWUXFWLRQ
6XUIDFHV
The project is impacted by the following Chino ALUCP Safety Zones:

Form Updated: March 3, 2016Page 1
Zone 6
Allowable Height:

PDEV22-027 & PUD22-004
NWC of Euclid Ave and Walnut Street
1051-271-67, 06 & 66
Commercial shopping center with vacant/underutilized buildings Development Plan to construct 346 multi-family units and 6,000 SF of commercial

10.63 N/A
ONT
The proposed project is located within the Airport Influence Area of Ontario International Airport (ONT) was evaluated and found to be consistent with the policies and criteria of the Airport Land Use Compatibility Plan (ALUCP) for ONT. ✔
Lorena Mejia
909-395-2276
Alexis Vaugn
1/30/2023
2022-051
N/A
55 FT
200 FT+
250
Department: Police Department
Prepared By: Matthew Hernandez
Staff Member Presenting:

Mike Lorenz, Chief of Police
Approved By:

Submitted To: Council/OHA
Approved: _______________________________
Continued To: ___________________________
Denied: __________________________________
Item No: 12
SUBJECT:

ACCEPT AND APPROVE LAW ENFORCEMENT EQUIPMENT GRANT PROGRAM ADDITIONAL AWARD FOR FISCAL YEAR 2022-23

CITY OF ONTARIO
Agenda Report
November
7, 2023
SECTION:

CONSENT CALENDAR

RECOMMENDATION:

That the City Council authorize the City Manager or his designee to execute all documents necessary to accept and approve the Citizen's Option for Public Safety (COPS) / Enhancing Law Enforcement Activities Subaccount (ELEAS) Grant for Fiscal Year 2022-23 in the amount of $277,260.

THE FOLLOWING COUNCIL GOALS ARE BEING ACHIEVED:

Maintain the Current High Level of Public Safety
Pursue City's Goals and Objectives by Working with Other Governmental Agencies FISCAL IMPACT:

On December 6, 2022, the City Council approved the acceptance of the Citizen's
Option for Public Safety (COPS) / Enhancing Law Enforcement Activities Subaccount (ELEAS) grant
program for Fiscal Year 2022-23 in the amount of $277,260. The program has since awarded the City an additional $239,261 reallocated from actuals received from the State's Vehicle License Fee (VLF) revenues for Fiscal Year 2022-23. If approved, the associated revenue and expenditure adjustments in the Grants Fund will be presented in the next quarterly budget update.

BACKGROUND & ANALYSIS:

Beginning in Fiscal Year 2002-03, the State of California allocated grant monies
Citizen's Option for Public Safety (COPS) / Enhancing Law Enforcement Activities Subaccount (ELEAS)
, formerly known as Supplemental Law Enforcement Services Fund to counties.

The County granted those monies to cities for the purpose of supporting front-line law enforcement needs. The California State Department of Finance later announced the actual funding allocation amounts to be awarded to each participating agency under the COPS/ELEAS grant program. The City of Ontario is receiving an additional award of $239,261. If approved, the associated revenue and expenditure adjustments will be presented in the next quarterly budget adjustment. 251
252
Department: Police Department
Prepared By: Nicole Alvarez
Staff Member Presenting:

Mike Lorenz, Chief of Police
Approved By:

Submitted To: Council/OHA
Approved: _______________________________
Continued To: ___________________________
Denied: __________________________________
Item No: 13
SUBJECT:

ACCEPTANCE OF GRANT AWARD FROM THE U. S. DEPARTMENT OF HOMELAND

SECURITY AND THE CALIFORNIA OFFICE OF EMERGENCY SERVICES PROVIDED THROUGH THE FISCAL YEAR 2022 URBAN AREA SECURITY INITIATIVE (UASI)

GRANT PROGRAM

CITY OF ONTARIO
Agenda Report
November
7, 2023
SECTION:

CONSENT CALENDAR

RECOMMENDATION:

That the City Council authorize the City Manager or his designee to execute all documents necessary to accept a three-year sub-grant award in the amount of $600,000 from the U.S. Department of Homeland Security and the California Oﬃce of Emergency Services provided through the Fiscal Year 2022 UASI Grant Program.

THE FOLLOWING COUNCIL GOALS ARE BEING ACHIEVED:

Maintain the Current High Level of Public Safety
Pursue City's Goals and Objectives by Working with Other Governmental Agencies FISCAL IMPACT:

The City, through the Riverside Urban Area Security Initiative (RUASI) grant, has been awarded $600,000 to purchase portable road barriers. The associated grant revenue and expenditure adjustments will be presented in the next quarterly budget report to the City Council.

The City is not required to provide matching funds for this reimbursable grant.

BACKGROUND & ANALYSIS:

The UASI program provides ﬁnancial assistance to address multidiscipline planning, operations, equipment, training, and exercise needs unique to high-threat, high density urban areas, and to assist them in building and sustaining capabilities to prevent, protect against, respond to, and recover from threats or acts of terrorism and weapons of mass destruction. The intent of the UASI program is to enhance regional preparedness and expand collaboration efforts.

The RUASI includes the cities of Riverside, San Bernardino and Ontario, and the counties of Riverside and San Bernardino. Projects are recommended for consideration by the RUASI Steering Group and local Approval Authority which are comprised of staﬀ from the three cities and two counties. Recommendations are made based upon the ability to match project beneﬁts the UASI program guidelines, which include a focus on regional coordination and collaboration. The 144 Riverside Regional UASI's recommended projects are then subject to review and approval at the State and Federal levels. The City of Ontario, as a sub-recipient of the Fiscal Year 2022 RUASI Grant, 253
has been approved to receive $600,000 for the purchase of portable road barriers.

The City is not obligated to continue with these grant programs beyond the equipment's operational life. Upon termination of the programs, Staﬀ will work with the City of Riverside Oﬃce of Emergency Services (the designated Riverside Regional UASI Administrative Entity) and the Department of Homeland Security to properly demobilize and surplus the equipment. 254
255
256
Department: Police Department
Prepared By: Matthew Hernandez
Department:

Prepared By: Matthew Hernandez
Staff Member Presenting:

Mike Lorenz, Chief of Police
Approved By:

Submitted To: Council/OHA
Approved: _______________________________
Continued To: ___________________________
Denied: __________________________________
Item No: 14
SUBJECT:

AUTHORIZE A SOLE SOURCE PURCHASE OF A PUBLIC SAFETY VEHICLE FROM LDV INC.

CITY OF ONTARIO
Agenda Report
November
7, 2023
SECTION:

CONSENT CALENDAR

RECOMMENDATION:

That the City Council approve and authorize the City Manager or his designee to execute all documents necessary for the sole source purchase of a Public Safety Vehicle from LDV Inc., of Burlington, Wisconsin, in the amount of $500,030.

THE FOLLOWING COUNCIL GOALS ARE BEING ACHIEVED:

Maintain the Current High Level of Public Safety
Pursue City's Goals and Objectives by Working with Other Governmental Agencies FISCAL IMPACT:

Appropriations for a Public Safety Vehicle for a total not-to-exceed amount of $500,030 will be included in the DOJ Asset Seizure Fund in the next quarterly budget adjustment for Fiscal Year 2023-24.

BACKGROUND & ANALYSIS:

The Police Department is dedicated to enhancing operations with state-of-the-art equipment to reduce violence in the City. The goal is to increase the organization’s capacity in situations that require negotiations by utilizing a multi-purpose vehicle to assist the department with tactical operations.

LDV Inc. is the largest supplier of custom specialty vehicles in North America with more than 20,000 vehicles delivered since 1977. LDV Inc. has built units for some of the nation’s most respected police departments, sheriﬀ’s oﬃces, ﬁre departments, Federal agencies, utilities, insurance companies, hospital groups, and commercial clients. LDV Inc. has successfully delivered over 175 vehicles to CA since 1995. This experience allows LDV Inc. to focus on continuous improvements including innovative designs, materials, and technologies to improve user experience and vehicle performance.

LDV Inc. has a current contract with the Houston-Galveston Area-Council (H-GAC), an organization of which the City of Ontario is a member. H-GAC maintains a Cooperative Purchasing Program, known as HGACBuy, and provides a list of Contractors whose pricing has been subjected to either a 257
competitive bid (IFB) or competitive proposal (RFP) process. Use of HGACBuy for purchases by any Member is strictly at the discretion of that entity. Members must issue their purchase orders and pay the HGACBuy Contractor directly. City Council approval will allow the City to acquire a Public Safety Vehicle from LDV Inc. at a competitive price established by HGACBuy. 258

180 Industrial Drive

Burlington, WI 53105 USA

Phone: 800
-
558
-
5986

Fax: (262) 76
7 -
2529

Direct: +1 (262) 763
-
0147

www.ldvusa.com

PRELIMINARY

SPECIFICATIONS FOR:

ONTARIO PD (CA)

Hostage Negotiation Vehicle

LDV PROPOSAL # C26HNT
-
35108
-
23 DATE

August 17, 2023 REV 9

June 5, 2023 REV8

May 31, 2023 REV7

May 24, 2023 REV6

May 23, 2023 REV5

January 25, 2023
REV4

November 23, 2021 REV3

September 13, 2017 REV2
259

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180 Industrial Drive

Burlington, WI 53105 USA

Phone: 800
-
558
-
5986

Fax: (262) 76
7 -
2529

Direct: +1 (262) 763
-
0147

www.ldvusa.com

TABLE OF CONTENTS

CHASSIS:

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...
4 BODY:

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.........
4 PAINT / GRAPHICS:

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..................
5 DRIVER / PASSENGER CAB AREA:

................................
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........................
5 WALLS, CEILING AND FLOOR:

................................
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................................
................................
6 GALLEY / LAVATORY:

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..............
6 SEATING:

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................................
...
6 CABINETS:

................................
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................................
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................................
.
7 HVAC SYSTEM:

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.........................
7 AC ELECTRICAL SYSTEM:

................................
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................................
.......
8 DC ELECTRICAL SYSTEM:

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......
9 EMERGENCY LIGHTING / SIRENS:

................................
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......................

10 AUDIO / VIDEO:

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11 RADIOS:

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..

12 COMPUTER NETWORK AND EQUIPMENT:

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........

12 MISCELLANEOUS ELECTRONICS:

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13 EXTERIOR STORAGE COMPARTMENTS:

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...........

13 MISCELLANEOUS OTHER:

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...

13 260

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180 Industrial Drive

Burlington, WI 53105 USA

Phone: 800
-
558
-
5986

Fax: (262) 76
7 -
2529

Direct: +1 (262) 763
-
0147

www.ldvusa.com

PRICING PAGE: (HGAC contract AM10
-
23)

Total price per unit as specified, FOB Origin

$468,132.00

Discount amount

-
$17,321.00

HGAC discounted price for 1 unit as specified

$450,811.00

Contract
Administration Fee
-

HGAC

$1,000.00

HGAC discounted price for 1 unit as specified with Contract Admin Fees

$451,811.00

Delivery charge to Ontario (CA)

$7,986.00

Total price per unit

$459,797.00

BREAKOUT COST FOR STREET SIDE TV’S AND
COMPARTMENTS:

Includes four (4) Samsung 32" TVs, two (2) exterior TV compartments, four (4) HDMI ports for TVs,

two (2) GFCI duplex outlets, two (2) dual USB charging ports, and one (1) awning.

$30,026.00

Delivery terms: Ask your Sales
Representative.

Payment Terms: Net 30.

Quote is firm for
9 0 days from specification date.

Quoted price does not include any applicable FET, federal, state or local tax unless specified.

Sales Tax 8.75%
(
LDV does not collect sales tax. Tax to be
paid by customer.
)

$40,232.24

261
180
Industrial Drive

Burlington, WI 53105 USA

Phone: 800
-
558
-
5986

Fax: (262) 763
-
0156

Direct: +1 (262) 763
-
0147

www.ldvusa.com

Item

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1.00 CHASSIS:

1.01 1

2024 Ford Commercial Cutaway E
-
450 Super Duty, 176" WB, DRW, rear wheel drive, 14,500
GVWR with rear spring suspension.

Powertrain:

• Engine: 7.3L V8 gas

• Transmission: 6
-
Speed Automatic w/OD

• 4.56 Axle Ratio

Wheels & Tires:

• Tires: LT225/75R16E BSW AS

• Wheels: 16" x 6" White Painted Steel

Seats & Seat Trim:

• Dual High Back Buckets

• Vinyl Seat Trim

Other Options:

• Traction Control

• Extra Heavy
-
Duty 210
-
Amp Alternator

• Heavy
-
Duty 78
-
Amp Battery

• Telescopic Trailer Tow Mirrors w/Flat Lens

•
Instrument Panel Electronic Message Center

• Power Windows & Locks Group

• Cruise Control

• Radio: AM/FM Stereo w/Clock Display & 2 Speakers. Includes Bluetooth capability and USB input.

• User
-
Defined Switches
–

Includes 4 upfitter switches on the instru
ment panel

• 50 State Emission System
-

Tier 2 Bin 8 emissions

1.02 1

Spring upgrade installed on rear suspension.

1.03 1

Federal Signal

Back
-
up alarm model 210331.

1.04 1

US DOT triangle reflector kit with three (3) triangles, for compliance with FMCSA regulations.

Includes plastic storage case. Kit will be shipped loose in the vehicle.

1.05 1

Route horizontal exhaust to streetside.

2.00 BODY:

2.01 1

Load space area shall be 83" high x 93" wide x 16' long custom dry van body with the following:

• Aerodynamic cap on front bulkhead unit with sliding door access to cab.

• One (1) 32" wide x 78" high sedan door with fixed window

• FRP front wall

• Aluminum .040 walls.

• 1 ½” Alum. I Beams on 16" centers.

• Aluminum roof

• 1
-
1/8" tongue
& groove plywood floor.

• 18” steel treadplate full step bumper.

• LED Rear break, turn, and 4 back
-
up lights

2.02 1

Exterior heavy
-
duty fluted aluminum grab handle with rubber inserts and chrome plated stanchions installed at entry door.

262
180
Industrial Drive

Burlington, WI 53105 USA

Phone: 800
-
558
-
5986

Fax: (262) 763
-
0156

Direct: +1 (262) 763
-
0147

www.ldvusa.com

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2.03 1

Interior heavy
-
duty fluted aluminum grab handle with rubber inserts and chrome plated stanchions installed
at

entry door.

2.04 1

Automatic LED courtesy light at entry door.

2.05 1

Courtesy light defeat switch.

2.06 1

Back
-
up alarm defeat switch on dash.

2.07 1

Lippert Treadlite 30" wide
-

single
-

automatic electric steel entry step mounted under entry door.

Product features:

•

Automatic LED ground light

•

Hold/Cycle switch that allows step to remain extended unless ignition is turned on.

NOTE:

Step
light will be tied into courtesy light defeat.

2.08 1

Entire underside shall be undercoated. Includes floor extrusions, step wells and aluminum compartments.

3.00 PAINT / GRAPHICS:

3.01 Body and Cab paint base color shall be single color nonmetallic paint from the roof line down.

NOTE:

Color to be blue. Color code to be submitted at the time of order.

3.02 1

4 -
inch wide reflective stripe on the exterior back and sides of the vehicle.

3.03 1

Custom computer
-
generated
non
-
reflective vinyl graphics per customer specifications.

Includes up to seventy 8"
-
10" letters and up to forty
-
five 3"
-
6" letters. All lettering can be
shaded or outlined.

4.00 GENERAL INTERIOR SPECIFICATIONS:

• Wall Covering: #66 Silver Smooth FRP i
n the front room, carpet in the rear room (color TBD)

• Ceiling Fabric: Silver Mist

• Floor Covering: #150 Onyx PVC Flooring

• Office Chairs: Black

• Vinyl Coverings: #WH1
-
2140 Whisper Black

• Cabinets: Charcoal Gray Powder Coated Aluminum

• Counters and

Tables: #4880
-
38 Carbon Mesh

Note: Manufacturer reserves the right to substitute equivalent materials.

5.00 DRIVER / PASSENGER CAB AREA:

5.01 Cab Area Additions:

• Vehicle height sign on dash.

• Vehicle shall have a Final Stage Vehicle
Certification and Altered Vehicle Certification as
required by Federal Motor Vehicle Safety Standards (FMVSS) 49 CFR Part 567.5 and 567.7

• Payload sticker in cab area with vehicle axle load ratings and available axle payload as built.

5.02 1

Custom
fabricated console in cab, for locating siren controller, police radio and/or other controls as specified elsewhere in this document.

5.03 1

Color back up camera system with 7" LCD monitor and day/night camera. Camera includes a microphone for audio comm
ands from a spotter to the driver during backing operations.

263
180
Industrial Drive

Burlington, WI 53105 USA

Phone: 800
-
558
-
5986

Fax: (262) 763
-
0156

Direct: +1 (262) 763
-
0147

www.ldvusa.com

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6.00 WALLS, CEILING AND FLOOR:

6.01 Install wood furring strips on interior body side posts and roof supports to provide space for the installation of insulation, conduit and
electrical boxes.

6.02 Insulate walls with a minimum of 2
-
1/2" of fiberglass insulation. Cover interior body side posts with 1/2" plywood sub wall.

6.03 Cover sub wall with smooth finish
Kemlite

0.075" fiberglass reinforced plastic (FRP) lining.

Wal
l covering shall be a continuous piece front to back, no seams acceptable.

NOTE:

FRP walls in the front room.

6.04 Cover sub wall with ribbed loop pile carpet.

NOTE:

Carpeted walls in the rear room.

6.05 Insulate ceiling with a minimum of
2 -
1/2" of fiberglass with an R
-
11 rating.

• Cover interior roof beams with 1/2" plywood.

• Modular panel design allows for manageable future additions and repairs.

• Plywood Panels covered in acoustical fabric.

6.06 Floor underlayment to be 5/8" exteri
or grade tongue and groove structural plywood, 6 ply, face veneer plugged and sanded.

6.07 Lonseal

Loncoin

II Flecks non
-
skid commercial grade PVC flooring. The flooring shall be continuous, one piece full length, full width, no seams.

6.08 Vinyl cove molding (mop board) at base of wall, 2
-
1/2” high. Installed where required.

6.09 1

Flush pocket door inst
alled on heavy
-
duty aluminum c
-
channel track with two (2) three
-
wheel
roller trucks and soft open/close feature. Pocket door shall have recessed handle and magnetic closure to keep the door open/closed.

6.10 1

Tinted window in pocket door.

6.11 All bul
kheads shall be covered with
Kemlite

0.075" FRP. Trim exposed edges of bulkheads
with rounded anodized aluminum trim where applicable.

6.12 1

Tinted window in pocket door.

7.00 GALLEY / LAVATORY:

7.01 1

Microwave oven. Sharp 1.1 cu.ft. 1000
-
watt Model SMC1131CB.

7.02 1

Norcold

NR751B AC and DC powered refrigerator with the following features:

• 2.7 cu. ft. capacity.

• Freezer shelf for ice cube tray.

• Door bin holds 2
-
liter containers.

•
Integrated door latch.

• 120/230Vac 50/60 Hz and 12/24 Vdc

8.00 SEATING:

8.01 4

HON Basyx HVL210 pneumatic task chair with five
-
star caster spider base, adjustable height
and no armrests.

8.02 4

Securement strap with buckle installed under counter to secure office chair.

8.03 Fabricate and install fixed bench seating with removable cushions as shown on drawing.

Bench seat cushions shall be covered in heavy
-
duty vinyl.

264
180
Industrial Drive

Burlington, WI 53105 USA

Phone: 800
-
558
-
5986

Fax: (262) 763
-
0156

Direct: +1 (262) 763
-
0147

www.ldvusa.com

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8.04 BENCH SEAT REQUIREMENTS:

• Foam for seat backs and bottoms shall be
firm density.

• All bench seating material must meet Federal Motor Vehicle Safety Standards part 571.302 Flammability of Interior Materials.

• Material corners shall be squared or angled to fit precise cut of foam.

• Foam shall be bonded to plywood backer
with industrial grade adhesive.

•
Attachment

of fabric/vinyl to backer shall
utilize

industrial grade upholstery staples.

9.00 CABINETS:

9.01 Custom fabricated aluminum cabinets located as shown on drawing. Cabinet specifications:

• Base
cabinets constructed of 0.080" powder coated aluminum with anodized aluminum frames.

• Base cabinet doors are double shell, formed from a single sheet of 0.080" aluminum, with a

0.040" aluminum door back attached.

• Overhead cabinets constructed of 0.064"p
owder coated aluminum with anodized aluminum
frames.

• Overhead cabinet doors are double shell, formed from a single sheet of 0.064" aluminum, with a 0.040" aluminum door back attached.

• Overhead cabinet doors swing up with gas spring lift supports.

9.02 Radius edging incorporated as design permits.

9.03 6

Dry erase writing surface on overhead cabinet door.

9.04 5

LED light under overhead cabinet.

9.05 1

Slide
-
out printer tray.

9.06 2

Magnetic dry erase board framed in aluminum. Includes
aluminum clip frame for easy board
replacement, sized as required.

9.07 3

Aluminum box pan shelf, up to 24” wide.

9.08 Heavy B
-
Line steel channel fastened to bulkheads for shelf support.

9.09 Countertops shall be covered in 0.040"
Wilsonart

laminate.

All exposed edges shall be
covered with heavy duty flexible PVC T
-
molding.

9.10 Countertops shall be covered in 0.040"
Wilsonart

laminate. All exposed edges shall be
covered with heavy duty flexible PVC T
-
molding.

Create custom cutout into table to accommodate a recessed HNT case per the drawing and customer specifications.

9.11 2

Pencil drawer under countertop.

9.12 1

Install
a key display board inside overhead cabinet and clearly tag all keys for the vehicle as to their purpose.

9.13 Custom fabricated console to house electrical distribution components and control panels.

10.00 HVAC SYSTEM:

10.01 1

Ducted low
profile rooftop air conditioner with wall mounted thermostat. Includes:

• 13,500 nominal Btu/hr air conditioner with condensate pump.

• Chill Grille Assembly with 6,000 Btu/hr heat strip

• Louvered Ceiling Vents, as required

10.02 1

Duct air conditioner
through pocket door header with surface mounted duct. Duct to be covered with ceiling fabric.

265
180
Industrial Drive

Burlington, WI 53105 USA

Phone: 800
-
558
-
5986

Fax: (262) 763
-
0156

Direct: +1 (262) 763
-
0147

www.ldvusa.com

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10.03 1

5,800
-
12,000 Btu/hr

direct discharge, 12Vdc powered, gasoline
-
fired furnace with individual
thermostat control. Exhaust shall be routed to the street side.

10.04 1

Duct heater through pocket door bulkhead wall.

11.00 AC ELECTRICAL SYSTEM:

11.01 1

Onan Commercial QG EFI 7000 7kW 120/240 volt AC generator HGJAD -
2141 mounted in
custom fabricated all aluminum compartment. Product features:

• Sound rating at 10 ft (3 m) full load: 70 dB(A)

•
Cummins Onan OHV engine

• Overspeed/underspeed

protection

• Fuel consumption is as follows: 50% load = 0.73 GPH, full load = 1.22 GPH

Compartment shall be constructed to the following specifications:

•
Compartment shall be constructed from 0.187" aluminum with all welded seams.

• Compartment shall h
ave 0.125" aluminum 2" box pan door and 0.125" aluminum frame.

• Door frame shall be riveted to the body and welded to the compartment.

• Door shall have stainless steel hinge attached to the door and door frame with stainless machine screws.

• Door shall
be sealed with industrial grade neoprene gasket.

NOTE:

Generator exhaust shall be routed to the street side of the vehicle.

11.02 1

120/240Vac electrical control panel with the following features:

•

60A generator and 30A shore power main breakers

•

Six
(6) AC UL listed magnetic/hydraulic branch circuit breakers with LED indicators

•

Digital AC voltmeter

•

Generator stop/start switch, generator hour meter

•

Shore power reverse polarity indicator

11.03 1

Marinco

30A
-
125Vac waterproof shore power inlet, 50
-
ft. 3
0A
-
125Vac shore power cord, 6
-
ft.
30A
-
125Vac pigtail.

11.04 5

20A
-
125Vac duplex receptacle with dual USB [Type A] charging ports. Receptacle is not dedicated to any installed equipment.

NOTE:

One (1) at each workstation.

11.05 4

20A
-
125Vac GFCI
duplex receptacle. These receptacles are not dedicated to any installed equipment.

NOTE:

One (1) located in each exterior TV compartment and one (1) above refrigerator.

11.06 Wire chase wire management raceway system located as shown on drawing. Produc t
features:

•

Satin anodized finish. The finish resists rust, corrosion and fading. Material extruded from 6063
-
T5 aluminum alloy.

•

Removable dual cover. Makes wiring easy and accessible and provides maximum flexibility for adding or relocating outlets and c
ircuits. The cover retention is 45 lbs. straight pull for one minute.

266
180
Industrial Drive

Burlington, WI 53105 USA

Phone: 800
-
558
-
5986

Fax: (262) 763
-
0156

Direct: +1 (262) 763
-
0147

www.ldvusa.com

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•

UL Listed multioutlet assemblies. File E68073 Guide PVGT, Fittings: File E121188 Guide RJPR. Meets Article 380 of NEC and meets Section 12
-
3032 of CEC.

•

UL and cUL Listed component race
ways. File E73943 Guide RJBT, Fittings: File E74343
Guide RJPR. Meets Article 386 of NEC and meets Section 12 -
600 of CEC.

•

UL5 and ADA compliant. Raceway and fittings meet UL5 specifications and can be installed in conformance with ADA
requirements

11.07 AC WIRING REQUIREMENTS:

•

All AC main wiring shall be stranded THHN wire and run in non -
metallic liquid tight conduit.

•

All AC branch circuit wiring shall be stranded THHN wire (AWG 12 minimum) and run in non -
metallic liquid tight and ENT

conduit.

•

All electrical circuits and appliances shall conform to applicable national electrical codes.

12.00 DC ELECTRICAL SYSTEM:

12.01 • Two (2) 6Vdc Absorbed Glass Mat (AGM) batteries. The batteries will be separated from the chassis
batteries for auxiliary equipment.

• Two (2) electronic converter/chargers, 60
-
amp minimum output each. Converter/charger
features:

• Charges three banks of batteries at the same time.

• UL listed for safety.

• Manual reset circuit breaker
.

• Reverse battery protection.

• Electronic current limiting.

• High voltage protection.

• 12Vdc control panel with seven (7) UL listed magnetic/hydraulic circuit breakers with red LED indicators, 12Vdc digital voltmeter, and 12Vdc low volt age alarm.

• 12Vdc auxiliary panels with UL listed magnetic/hydraulic circuit breakers as required.

12.02 1

Battery combiner automatically combines the battery banks during charging and isolates when no charging sensed on either bank.

A three position control switch allows an operator to
manually combine or separate batteries, to jump start engine or troublesho ot a failure.

12.03 1

Dual Auxiliary Battery Disconnect System. Enables auxiliary battery disconnect to be activated from cab or load space area.

12.04 8

Light, Orion 6" LED, neutral white with polished bezel.

12.05 4

Light, Orion 6" LED, neutral white

/ red with polished bezel.

12.06 6

Whelen

900 Series Super LED Scenelight 9SC0ENZR (or current model) includes chrome plated flange.

12.07 3

12VDC dual USB power port.

NOTE:

One (1) located in each exterior TV compartment.

12.08 12VDC WIRING
REQUIREMENTS:

• 2
-
gauge minimum copper stranded battery cable shall be used for 12Vdc main supply lines.

All cable runs shall be full length, no splices. All cable terminals shall be staked and soldered.

All cable shall be enclosed in convoluted polyeth
ylene tubing and the ends of the cable shall be
sealed with color
-
coded shrink
-
wrap identifying the function of the cable.

267
180
Industrial Drive

Burlington, WI 53105 USA

Phone: 800
-
558
-
5986

Fax: (262) 763
-
0156

Direct: +1 (262) 763
-
0147

www.ldvusa.com

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• All added electrical branch circuits shall be protected from over -
current by resettable circuit
breakers appropriately rated for th
e load. Only circuit breakers shall be used in the installation of added electrical branch circuit wiring (plug type fuses are unacceptable).

• Circuit breaker functions shall be identified by engraved or printed labels.

• All added wiring for load runs o
f AWG 10, 12, 14, and 18, shall conform to MIL
-
W
-
16878/2
and/or UL1007/1569”

• All added wiring for load runs of AWG 8, shall conform to MIL -
W
-
16878/3 and/or UL1028

• Wire terminals for added circuits must conform to MIL -
T
-
7928. Terminals shall be insul
ated,
insulation grip, TYPE II, CLASS 2 and shall be crimped with tooling recommended by the terminal manufacturer.

• All wiring shall be numbered or lettered on 6" centers minimum.

• Wiring shall be protected from chafing and abrasion with convoluted poly ethylene tubing (wire
loom) as required.

• Where wire passes through sheet metal, bulkheads and structural supports, plastic grommets shall be used to protect both wiring and wire looms.

• All wire bundles shall be tied with trimmed nylon ties.

• Extreme
care shall be exercised to provide for easy serviceability of the system in future years.

• Extreme care must be taken in the installation to avoid the engine manifold, engine exhaust, and muffler, which could expose the wiring to severe overheating during

long periods of
operation. Proper insulation and heat deflection panels must be installed in such areas.

• A high
-
current 12Vdc system wiring schematic shall be provided.

• These are the minimum acceptable 12Vdc wiring requirements.

13.00 EMERGENCY LIGHTING / SIRENS:

13.01 1

Whelen

295HFS6 siren with 9 high current switches for lighting controls

NOTE:

Slide Bar Positions Control:

1. Rear (Upper and Lower)

2. Rear (Upper and Lower), All Upper, Front Wall or "Light bar"

3. All

13.02 1

Whelen SA315P high performance, multi
-
port 100 watt speaker with Whelen SAK1 mount.

13.03 1

Whelen TLIR ION
-
T
-

Series
™

Linear Super
-
LED® Red with clear outer lens & TIONFC
chrome flange.

NOTE:

Grill

13.04 1

Whelen TLIB ION
-
T
-

Series
™

Linear Supe
r
-
LED® Blue with clear outer lens & TIONFC
chrome flange.

NOTE:

Grill

13.05 5

Whelen M6 series, M6RC (or current model), Linear Super -
LED lighthead with internal flasher,
RED LED's with CLEAR outer lens. Includes M6FC chrome flange.

13.06 5

Whelen M6 series, M6BC (or current model), Linear Super -
LED lighthead with internal flasher,
BLUE LED's with CLEAR outer lens. Includes M6FC chrome flange.

268
180
Industrial Drive

Burlington, WI 53105 USA

Phone: 800
-
558
-
5986

Fax: (262) 763
-
0156

Direct: +1 (262) 763
-
0147

www.ldvusa.com

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13.07 3

Whelen
M9 series, M9RC, Linear Super
-
LED lighthead with internal flasher, RED LED's with
C
LEAR outer lens. Includes chrome flange.

13.08 3

Whelen

M9 series, M9BC, Linear Super
-
LED lighthead with internal flasher, BLUE LED's with
CLEAR outer lens. Includes chrome flange.

14.00 AUDIO / VIDEO:

14.01 2

LG 24" Black 720P LED HDTV
-

24LM530S
-
PU Features:

•

720P resolution

•

(2) HDMI inputs

•

(2) Speakers

NOTE:

Locations: One at each forward workstation.

14.02 6

Samsung 32" QLED TV QN32Q60AAFXZA with wall mount bracket. Product features:

•

Resolution 4K

•

(3) HDMI, (2) USB

•

(2) Speakers

•

DTV Tuner/ATSC / Clear QAM

•

Dimensions: 28.5"(W) x 16.8"(H) x 1.2"(D) Weight 11.7lbs

NOTE:

Locations:

• One (1) in the rear room

• Four (4) in the street side exterior TV compartments

• One (1) in the curb side exterior TV compartment

14.03 1

Weatherproof single door exterior work station and TV/monitor compartment. Constructed from

0.125" aluminum with
all welded seams and hinged at the top.

Includes:

• Internal flip down work surface

• LED strip light (illuminates when door is opened)

• Gas charged lift support and locking latch

NOTE:

Location: One (1) curb side

14.04 2

Exterior surface
mounted compartment to house two exterior TVs. Door to be constructed from

0.125" aluminum with all welded seams, hinged at the top. Product features:

• Gas charged lift supports and locking latch.

• Internal flip down work surface

• Installed and Painted
to match body.

• Does not include monitors.

NOTE:

Locations: two (2) street side compartments.

The following equipment will be installed in each exterior TV compartment:

• Two (2) 32" TVs

• Two (2) HDMI inputs (one to each TV)

• One (1) 120
-
volt GFCI ou
tlet

• One (1) dual USB charging ports

269
180
Industrial Drive

Burlington, WI 53105 USA

Phone: 800
-
558
-
5986

Fax: (262) 763
-
0156

Direct: +1 (262) 763
-
0147

www.ldvusa.com

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14.05 1

JACK® model OA8500 Digital HDTV Antenna + Mount with SureLock ™

DTV Signal Meter. No
crank up, built in Amplifier and 360° rotation for improved reception.

14.06 8

HDMI input jack, wall plate and
cable.

NOTE:

One (1) HDMI jack inputted into each TV, interior and exterior.

14.07 All RF cable for DSS antenna systems (when specified) shall be Belden #9116 series 6 broadband coaxial cable. All other video cabling shall be Belden #1505A RG -
6/U prec
ision
video cable.

15.00 RADIOS:

15.01 12Vdc power leads for communications radios to be 8 -
gauge copper stranded wire with crimp
-
on end connectors. Power to radios to be controlled by auxiliary battery disconnect switch.

15.02 1

Prewire and make
installation provisions for customer installed radio. Installation includes:

• Two (2) Antenna Runs from the roof to radio location. These runs will each have an NMO -
style base on the antenna raceway and have LMR195 antenna cable routed to radio location i n
Carlon Carflex ENT conduit.

• One (1) 12Vdc power block located at the radio location.

15.03 Install hinged panels under countertops to conceal radio transceivers where applicable.

16.00 COMPUTER NETWORK AND EQUIPMENT:

16.01 6

RJ
-
45 Cat6 computer network jack with Cat6 cable routed through Carlon

Flex
-
Plus ENT
conduit or raceway (as applicable).

NOTE:

Locations: (1) at each workstation 1
-
4, (1) at printer, (1) in the exterior TV compartment.

16.02 1

Leviton

69270
-
U24 24
-
port Cat6 rack mount patch panel.

NOTE:

Location: Exterior TV box.

16.03 1

Cable Certification Report confirming that network wiring complies with Cat6 specifications.

16.04 1

Allied Telesis AT
-
GS950/24
-
10 24
-
port 10/100/1000T
Unmanaged Gigabit Switch. Product
features:

• Wirespeed performance

• Auto
-
negotiation Gigabit ports

• Auto MDI/MDIX on TX ports

• Transparent to VLAN packets

• Full duplex flow control

16.05 1

ASUS Wireless
-
N300 3
-
in
-
1 Router/AP/Range Extender.

• Multip
le 3
-
in
-
1 Router/Access Point/Range Extender wireless modes

• 2 detachable 5 dBi antennas for more powerful and wider coverage

• 4 SSIDs help manage bandwidth allocation and access control

16.06 1

HP Color LaserJet Pro Multi
-
Function Printer (MFP) M479FDW

Product features:

• Black/white or color print, copy, scan, and fax capable

• 1 Hi
-
Speed USB 2.0; 1 host USB at rear side;Gigabit

Ethernet 10/100/1000BASE
-
T network;
802.3az(EEE) 802.11b/g/n / 2.4 / 5 GHZ Wi
-
Fi radio

• Dimensions (W X D X H) 16.8 x 25.7 x 16.3 in; 51.6 Lbs.

270
180
Industrial Drive

Burlington, WI 53105 USA

Phone: 800
-
558
-
5986

Fax: (262) 763
-
0156

Direct: +1 (262) 763
-
0147

www.ldvusa.com

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17.00 MISCELLANEOUS ELECTRONICS:

17.01 1

Install cabling for customer owned HNT system.

17.02 1

Hannay mo
del AVC 16
-
10 -
11 -
DE manual cord reel for throw phone cable.

17.03 1

Hannay model AVC 16
-
14 -
16 -
DE manual cord reel for throw phone cable.

17.04 1

Cast Products

EB00013
-
1 (or current model) cast aluminum box with key lock. The rear of the box will be removed to allow cables to be passed into the vehicle.

17.05 1

Shroud with weatherproof pass
-
through hatch installed in the door of the input box.

18.00 EXTERIOR STORAGE COMPARTMENTS:

18.01 1

Storage compartment with approximate interior dimensions of 24" high x up to 46" wide x 25" deep constructed from 0.1875 " aluminum with all welded seams.

NOTE:

Compartment for cable reels.

18.02 Compartments list
ed above will be constructed to the following specifications:

• Sweep out type bottoms with 1/2” drain holes.

• 2" box pan doors and door frames fabricated from 0.125" aluminum.

• Door frames shall be riveted to the body and welded to the compartments.

• C
ompartments shall have an LED light that illuminates when the door is opened.

Compartment doors will be constructed to the following specifications:

• Stainless steel hinges attached with stainless machine screws.

• Slam latches and flush mounted handles.

• 0.100" bright polished aluminum diamond plate on interior surfaces fastened with stainless hardware.

• All doors shall be sealed with industrial grade neoprene gasket.

19.00 MISCELLANEOUS OTHER:

19.01 2

Dometic 9500E lateral arm 12V power awning
(up to 15ft) with the following features:

•
5 -

to 15
-
degree pitch adjustment

•
Durable 4
-
ply vinyl fabric
resists fading, scratching and staining

• Case’s brush seal cleans and seals the fabric for storage and long life

19.02 1

Quadra MFG. Inc.

Big Foot
™

Heavy duty, four point, fully automatic one
-
touch leveling system
for Ford E450.

19.03 1

Set of four (4) Super Dolly Pads high density polypropylene, injection molded yellow colored for use with leveling system jacks. Pads meas
ure 15” x 17” x 1” thick with a grab strap on one
side.

19.04 1

5 pound dry chemical fire extinguisher.

19.05 2

Battery powered combination Carbon Monoxide and Smoke alarm.

19.06 1

Complete manual set, including the following (as
applicable):

• As
-
built specifications with interior and exterior drawings as used for production of the vehicle.

• Chassis and body owner's manuals.

• 12Vdc and 120Vac legends showing wire gauge, color, number and function.

• 12Vdc high current wiring dia
gram illustrating the battery system, isolators, power converters, alternator, disconnect switches and control panels.

• Roof top antenna placement drawing and legend identifying antenna placements and termination points.

271
180
Industrial Drive

Burlington, WI 53105 USA

Phone: 800
-
558
-
5986

Fax: (262) 763
-
0156

Direct: +1 (262) 763
-
0147

www.ldvusa.com

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• Audio/Video cabling diagram.

• C
hassis and generator maintenance and service logs.

• Battery maintenance information.

• All individual component manuals and warranty registration cards as provided by component manufacturers. Customer is responsible for completing warranty cards and mail ing them to
manufacturers.

19.07 1

TRAINING. An LDV representative will provide up to four (4) hours of orientation on LDV provided systems, as applicable:

•

Generator start up and shut down procedure

•

Leveling system operation

•

AC and DC electrical systems o
peration

•

HVAC systems operation

•

Mast operation

•

Audio/Video system operation, does not include programming DVR's, TV's, etc.

•

Alarm operation

•

Awning operation

19.08 LDV warranty of one (1) year/12,000 miles, whichever comes first, for manufacturer’s defects
in materials and workmanship. Refer to LDV warranty statement for details of warranty coverage.

19. 09

Note: Project scope does not include certain tasks or costs that are the responsibility of the customer unless clearly specified
as LDV supplied. These items include, but are not limited to:

• Radio and telephone system programming.

• Activation and service fees for cellular telephones, satellite telephones, satellite TV, satellite internet access.

• Loading and configuring compute
r software.

In the event of a discrepancy between the drawing and specification, the specification will supersede. LDV reserves the right to make substitutions of equal quality and specifications of those listed in this document.

Some component models ch
ange frequently. In the event that a specified component model becomes unavailable at the time LDV attempts to source it, LDV will provide a replacement model with equivalent or better features, as agreed upon with the customer.

272
Department: Housing
Prepared By: Katryna Gonzalez
Staff Member Presenting:

Helen McAlary, Executive Director Community
Life and Culture
Approved By:

Submitted To: Council/OHA
Approved: _______________________________
Continued To: ___________________________
Denied: __________________________________
Item No: 15
SUBJECT:

ACCEPTANCE OF STATE OF CALIFORNIA HOMELESS HOUSING, ASSISTANCE AND PREVENTION ROUND 3 (HHAP-3) FUNDING ADMINISTERED BY THE COUNTY OF

SAN BERNARDINO TO RAPIDLY REHOUSE HOMELESS FAMILIES AND

INDIVIDUALS

CITY OF ONTARIO
Agenda Report
November
7, 2023
SECTION:

CONSENT CALENDAR

RECOMMENDATION:

That the City Council accept $135,000 in HHAP-3 funding to provide eight households that are homeless in the west valley of San Bernardino County with move-in costs and up to six months’ rent assistance and services to stabilize their housing.

THE FOLLOWING COUNCIL GOALS ARE BEING ACHIEVED:

Pursue City's Goals and Objectives by Working with Other Governmental Agencies FISCAL IMPACT:

The $135,000 contract amount includes $121,500 to fund rent assistance and security deposits, and $13,500 for the coordination of services. There is no local match requirement and no impact on the City’s General Fund.

BACKGROUND & ANALYSIS:

The San Bernardino City & County Continuum of Care (SBC CoC) was allocated funding by the State of California, Homeless Coordinating and Financing Council in the Business, Consumer and Housing Agency, hereinafter called State, under the Homeless Housing, Assistance and Prevention Round 3 (HHAP-3) Program authorized by AB 140 (Health & Safety Code § 50218.6, et seq.), which was signed into law by Governor Gavin Newsom on July 19, 2021. On April 24, 2023, the San Bernardino County Oﬃce of Homeless Services (OHS) released a Request for Applications that included $2,590,844.87 for regional proposals. Of that allocation, $350,901 was reserved for proposals in the West Valley region, encompassing Chino, Chino Hills, Montclair, Ontario, Rancho Cucamonga, Upland, and the surrounding unincorporated communities.

On May 17, 2023, the City of Ontario submitted an application for $150,000 to provide Rapid Rehousing rental assistance and services to assist homeless families and individuals. This application was coordinated with a complementary application submitted by the City of Montclair to provide temporary housing. The City of Ontario submission received the highest score for the West Valley region; however, due to the demand for funding, was reduced to $135,000. 273
The HHAP-3 Rapid Rehousing Program will provide up to 100% of the monthly rental payment for eligible households for no more than $15,000 per household and for no longer than six months.

Each participating household will enter into a one-year lease and must demonstrate their ability to assume the entire month’s rent when the HHAP-3 assistance ends. Housing Services Department Staﬀ will evaluate applications referred via the Coordinated Entry System. Staﬀ will guide eligible applicants in their housing search and oﬀer budgeting and planning assistance services. Program participants will also be referred into the San Bernardino County Workforce Development Program to improve employment options and increase income.

The target population for this program will be recently homeless households in the West Valley cities that can support their rental payments beyond six months. This program provides lower- income households the ﬁnancial support they need to stabilize their household income and housing situation. Priority will be given to households that have become homeless in the last year, have a member with a disability, or is a Veteran household unable to be served by other Veteran housing programs. Program participants may opt to move to a unit within the West Valley region of San Bernardino County.

Once the contract is executed, program outreach to obtain referrals will begin immediately, with a goal of moving six households into housing by January 2024, and the remaining two households before March 30, 2024. This pacing will enable the program to meet the County requirements to expend 50% of HHAP-3 funds by May 31, 2024.

Staﬀ recommends approval of the contract which will be executed upon San Bernardino County Board of Supervisors approval.
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THE INFORMATION IN THIS BOX IS NOT A PART OF THE CONTRACT AND IS FOR COUNTY USE ONLY Community Revitalization
Office of Homeless Services
Department Contract Representative Carrie Harmon
Telephone Number (909) 382-3983
Contractor City of Ontario
Contractor Representative Katryna Gonzalez
Telephone Number (909) 395-2322
Contract Term October 3, 2023–June 30, 2026
Original Contract Amount $135,000
Amendment Amount N/A
Total Contract Amount $135,000
Cost Center 6210002479
IT IS HEREBY AGREED AS FOLLOWS:

WHEREAS, the San Bernardino County Continuum of Care (SBC CoC) has been allocated funds by the State of California, Homeless Coordinating and Financing Council in the Business, Consumer and Housing Agency, hereinafter called State, under the Homeless Housing, Assistance and Prevention Round 3 (HHAP-3) Program authorized by AB 140 (Health & Safety Code § 50218.6, et seq.), which was signed into law by Governor Gavin Newsom on July 19, 2021; and
WHEREAS, the San Bernardino County (County) Office of Homeless Services, hereinafter referred to as OHS, is the Administrative Entity authorized to act on behalf of the County to administer HHAP-3 as designated by the SBC CoC, the eligible recipient of HHAP-3 funding; and
WHEREAS, the SBC CoC conducted a competitive process to find the City of Ontario (Contractor) to provide these services, and
WHEREAS, C ontractor has the required qualifications, experience and expertise to provide services and is willing to use State funds to serve individuals and families experiencing homelessness; and WHEREAS, the County desires that such services be provided by Contractor and Contractor agrees to perform these services as set forth below;
NOW, THEREFORE, the County and Contractor mutually agree to the following terms and conditions:

Contract Number
SAP Number
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TABLE OF CONTENTS

SECTION PAGE
A. DEFINITIONS 3
B. CONTRACTOR RESPONSIBILITIES 6
C. GENERAL CONTRACT REQUIREMENTS 14
D. TERM OF CONTRACT 22
E. COUNTY RESPONSIBILITIES 23
F. FISCAL PROVISIONS 23
G. INDEMNIFICATION AND INSURANCE REQUIREMENTS 23
H. RIGHT TO MONITOR AND AUDIT 26
I. CORRECTION OF PERFORMANCE DEFICIENCIES 27
J. NOTICES 27
K. ENTIRE AGREEMENT 27
L. ELECTRONIC SIGNATURES 27

ATTACHMENTS
EXHIBIT I – HHAP-3 AWARD BY CATEGORY
EXHIBIT 2 – SCOPE OF WORK
EXHIBIT 3 – HHAP-3 REPORTING REQUIREMENTS
EXHIBIT 4 – HMIS CLIENT DATA REPORT SAMPLE
EXHIBIT 5 – HMIS DATA QUALITY REPORT
EXHIBIT 6 – CALIFORNIA WELFARE AND INSTITUTIONS CODE SECTION 8255 EXHIBIT 7 – HHAP-3 EXPENDITURE REPORT
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A. DEFINITIONS
A.1 Administrative Entity: A unit of general-purpose local government (city, county, or a city that is also a county) or nonprofit organization that has (1) previously administered federal Department of Housing and Urban Development (HUD) Continuum of Care (CoC) funds as the collaborative applicant pursuant to Section 578.3 of Title 24 of the Code of Federal Regulations, and (2) been designated by the CoC to administer program funds.

A.2 Case Management: The coordination of community-based services by a professional team to provide people the quality health care that is customized accordingly to an individual’s setbacks or persistent challenges and aid them to their recovery. In addition, it can be defined as a collaborative process that assesses, plans, implements, coordinates, monitors, and evaluates the options and services required to meet the client’s health and human service needs.

A.3 Continuum of Care (CoC): The group organized to carry out the responsibilities required under this part and that is composed of representatives of organizations, including nonprofit homeless providers, victim service providers, faith-based organizations, governments, businesses, advocates, public housing agencies, school districts, social service providers, mental health agencies, hospitals, universities, affordable housing developers, law enforcement, organizations that serve homeless and formerly homeless veterans, and homeless and formerly homeless persons to the extent these groups are represented within the geographic area and are available to participate.

A.4 Continuum of Care (CoC) Service Providers: A network of Community Based Organizations partnered with the SBC CoC to provide services to homeless individuals and families.

A.5 Coordinated Entry System (CES): The CES is a centralized or coordinated process developed pursuant to Section 578.7 of Title 24 of the Code of Federal Regulations, as that section read on January 10, 2019, designed to coordinate homelessness program participant intake, assessment, and provision of referrals. In order to satisfy this subdivision, a centralized or coordinated assessment system shall cover the geographic area, be easily accessed by individuals and families seeking housing or services, be well advertised, and include a comprehensive and standardized assessment tool.

A.7 Emergency Aid: Any urgent and immediate services, which include housing that will be provided to homeless individuals. Broad categories of uses include, but are not limited to, shelters, shelter beds, public toilets, shower facilities, tiny-shed homes, etc.

A.8 Emergency Shelter: Housing with minimal supportive services for homeless persons that is limited to occupancy of six months or less by a homeless person. No individual or household may be denied emergency shelter because of any inability to pay.

A.9. General Service Area: The geographically defined area where a service entity provides outreach and direct services to homeless people.

A.10 Homeless: The same meaning as defined in Section 578.3 of Title 24 of the Code of Federal Regulations, as that section read on January 10, 2019:
(1) An individual or family who lacks a fixed, regular, and adequate nighttime residence, meaning:
(i) An individual or family with a primary nighttime residence that is a public or private place not designed for or ordinarily used as a regular sleeping accommodation for human beings, including a car, park, abandoned building, bus or train station, airport, or camping ground; (ii) An individual or family living in a supervised publicly or privately operated shelter designated to provide temporary living arrangements (including congregate shelters, transitional housing, and hotels and motels paid for by charitable organizations or by federal, State, or local government programs for low-income individuals); or
(iii) An individual who is exiting an institution where he or she resided for 90 days or less and who resided in an emergency shelter or place not meant for human habitation immediately before entering that institution;
(2) An individual or family who will imminently lose their primary nighttime residence, provided that:
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(i) The primary nighttime residence will be lost within 14 days of the date of application for homeless assistance;
(ii) No subsequent residence has been identified; and
(iii) The individual or family lacks the resources or support networks, e.g., family, friends, faith- based or other social networks, needed to obtain other permanent housing; (3) Unaccompanied youth under 25 years of age, or families with children and youth, who do not otherwise qualify as homeless under this definition, but who:
(i) Are defined as homeless under section 387 of the Runaway and Homeless Youth Act (42 U.S.C. 5732a), section 637 of the Head Start Act (42 U.S.C. 9832), section 41403 of the Violence Against Women Act of 1994 (42 U.S.C. 14043e–2), section 330(h) of the Public Health Service Act (42 U.S.C. 254b(h)), section 3 of the Food and Nutrition Act of 2008 (7 U.S.C. 2012), section 17(b) of the Child Nutrition Act of 1966 (42 U.S.C. 1786(b)), or section 725 of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11434a);
(ii) Have not had a lease, ownership interest, or occupancy agreement in permanent housing at any time during the 60 days immediately preceding the date of application for homeless assistance;
(iii) Have experienced persistent instability as measured by two moves or more during the 60-day period immediately preceding the date of applying for homeless assistance; and (iv) Can be expected to continue in such status for an extended period of time because of chronic disabilities; chronic physical health or mental health conditions; substance addiction; histories of domestic violence or childhood abuse (including neglect); the presence of a child or youth with a disability; or two or more barriers to employment, which include the lack of a high school degree or General Education Development (GED), illiteracy, low English proficiency, a history of incarceration or detention for criminal activity, and a history of unstable employment; or (4) Any individual or family who:
(i) Is fleeing, or is attempting to flee, domestic violence, dating violence, sexual assault, stalking, or other dangerous or life-threatening conditions that relate to violence against the individual or a family member, including a child, that has either taken place within the individual's or family's primary nighttime residence or has made the individual or family afraid to return to their primary nighttime residence;
(ii) Has no other residence; and
(iii) Lacks the resources or support networks,e.g., family, friends, and faith-based or other social networks, to obtain other permanent housing.

A.11 Homeless Management Information System (HMIS): A web-enabled database used by homeless service providers to capture information about the San Bernardino County persons they serve.

The database tracks services provided to homeless individuals and families by the collaborative agencies. Services tracked include: emergency, transitional, and permanent housing bed usage, employment, veteran’s status, as well as referrals to health and human service providers, or other relevant supportive service agencies. As required by the U.S. Department of Housing and Urban Development, the Continuum of Care utilizes the captured information to make informed decisions in planning, homeless advocacy, and policy development that result in target services. HMIS also includes that use of a comparable database by a victim services provider or legal services provider that is permitted under Part 576 of Title 24 of the Code of Federal Regulations.

A.12 Homeless Youth: An unaccompanied youth between 12 and 24 years of age, inclusive, who is experiencing homelessness, as defined in subsection (2) of Section 725 of the federal McKinney-Vento Homeless Assistance Act [42 U.S.C. Sec. 11434a(2)]; includes unaccompanied youth who are pregnant or parenting.

A.13 Housing First: An approach to quickly and successfully connect individuals and families experiencing homelessness to permanent housing without preconditions and barriers to entry, such as sobriety, treatment or service participation requirements. Supportive services are offered to maximize housing stability and prevent returns to homelessness as opposed to addressing predetermined treatment goals prior to permanent housing entry.
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A.14 Housing Search and Placement: Services to assist clients to locate, secure, and navigate the rental market. Housing Search and Placement activities may include, but are not limited to, unit identification, unit inspection, determining rent reasonableness, contracts, advocating for households, land/lord/ tenant mediation, and any other housing requirements.

A.15 Interagency Council on Homelessness (ICH): The policy making body for the San Bernardino County Homeless Partnership. ICH works to ensure that the recommendations listed in the County’s 10- Year Strategy to End Homelessness are realized. ICH Membership is composed of elected officials, state and local representatives, community and faith-based organizations, and corporate advocates.

A.16 Instance of Service: Each encounter with a member of the target population where services are provided for each of the eligible grant activities. For example, one individual checks into a warming center operated by Provider X on Tuesday. The same individual checks into the same warming center the next night. This counts as two instances of service for this activity.

A.17 Navigation Center: A Housing First, low barrier, service-enriched shelter focused on moving homes individuals and families into permanent that provides temporary living facilities while case managers connect individuals experiencing homelessness to income, public benefits, health services, shelter, and housing.

A.18 Office of Homeless Services (OHS): The lead agency for the San Bernardino County Continuum of Care (SBC CoC). The SBC CoC coordinates services with the San Bernardino County Homeless Partnership consisting of community and faith-based organizations, educational institutions, non-profit organizations, private industry, and Federal, State and local governments.

A.19 Permanent Supportive Housing (PSH):Low-barrier permanent housing with services. The type of services depends on the needs of the residents. Services may be short-term, sporadic, or ongoing indefinitely. PSH units are for individuals and families who are homeless or chronically homeless. PSH is housing combined with services, which may include mental health and health services, drug and alcohol treatment, education and job training.

A.20 Point-In-Time-Count (PITC): An unduplicated one-night estimates of both sheltered and unsheltered homeless populations conducted by Continuums of Care nationwide on a predetermined date within the last 10 days of each January pursuant to Section 578.3 of Title 24 of the Code of Federal Regulations.

A.21 Program: The Homeless Housing, Assistance and Prevention Round 3 (HHAP-3) Program, established pursuant to Chapter 5 of Part 1 of Division 31 of the Health and Safety Code, and HHAP-3 are used interchangeably throughout this document.

A.22 Rapid Re-Housing (RRH): An intervention designed to help individuals and families quickly exit homelessness and return to permanent housing. Using the Housing First model, move families and individuals into permanent affordable housing as quickly as possible with minimal barriers, assist with move-in costs such as security and utility deposits and short-medium term declining rental subsidies, and provide intensive social services while families or individual’s stability and equip them with skills and resources they need to sustain and thrive in housing and avoid future homelessness.

A.23 San Bernardino County Continuum of Care (SBC CoC): Provides leadership in creating a comprehensive countywide network of service delivery to homeless individuals and families and those at-risk of becoming homeless.

A.24 State of California, Homeless Coordinating and Financing Council (State): Created pursuant to Section 8257 of the Welfare and Institutions Code to, among other things, identify mainstream resources, benefits, and services that can be accessed to prevent and end homelessness in California. 279
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A.25 Subcontractor: An individual, company, firm, corporation, partnership or other organization, not in the employment of or owned by Contractor who is performing services on behalf of Contractor under a separate contract with or on behalf of Contractor.

A.26 Target Population: Any person who is homeless as defined for this grant (see A.10 above).

A.27 Transitional Housing (TH): Designed to provide homeless individuals and families with the interim stability and support to successfully move to and maintain permanent housing. TH may be used to cover the costs of up to 24 months of housing with accompanying supportive services.

A.28 United States Department of Housing and Urban Development (HUD): A Federal agency established in 1965, HUD’s mission is to increase homeownership, support community development, and increase access to affordable housing free from discrimination. To fulfill this mission, HUD will embrace high standards of ethics, management and accountability and forge new partnerships, particularly with faith-based and community organizations, that leverage resources and improve HUD’s ability to be effective on the community level.

B. CONTRACTOR RESPONSIBILITIES
B.1 General Requirements
B.1.1 Contractor shall be in compliance with all applicable Federal, State, and local laws, required to perform this Contract. Contractor shall be required to repay the County in the event of non-compliance with any applicable law if the County is required to repay any amount of funds to the State as a result of Contractor’s non-compliance.

B.1.2 Contractor and its Subcontractors shall perform the work in accordance with Federal, State and local housing and building codes, as applicable.

B.1.3 Contractor shall be responsible to accomplish the levels of performance as set forth in Exhibit 1 – HHAP AWARD BY CATEGORY and report such measures quarterly to the County with each quarterly expenditure report. The County will review Contractor performance to assess expenditure and performance progress. If Contractor is not meeting expenditure and performance measures, the County will work with Contractor to identify strategies and remediate performance issues.

B.1.4 Contractor’s obligation to the County shall not end until all closeout requirements are completed. Activities during closeout period shall include, but are not limited to: making final payments, disposing of program assets (including the return of all unused materials, equipment, unspent funds, and accounts receivable to the County), and determining the custodianship of records.

B.2 Scope of Work
The project description for services to be provided by Contractor under this Contract are identified in Exhibit 2 - SCOPE OF WORK.

B.3 Administrative Requirements
Contractor shall adhere to the following:

B.3.1 Coordinated Entry System (CES)
a. The CES is a referral process that currently coordinates with the SBC CoC. All those participating with CES will need to apply to participate with the Homeless Management Information System (HMIS).
b. Contractor must work in collaboration with CES and SBC CoC to ensure the screening, assessment, and referral of HHAP participants are consistent with the eligible uses under HHAP.
c. Contractor agrees to receive referrals from CES prior to providing services with the exception of individuals receiving emergency assistance. In such cases, immediate services can be provided, but individuals and/or families must be referred by Contractor to CES for assessment and prioritization within seventy-two 280
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(72) hours. Contractor understands that individuals and/or families may not be referred to Contractor and may be referred to another service provider based upon the CES assessment.

B.3.2 Data Reporting
a. Contractor will submit to OHS detailed reports containing information listed in Exhibit 3 – HHAP REPORTING REQUIREMENTS.
b. A report will be due forty-five (45) days after the date of expiration of this Contract or upon completion of Contract services.
c. Contractor shall submit additional reports as required by the State or County.

B.3.3 Equipment and Other Property
All equipment, materials, supplies or property of any kind (including vehicles, publications, copyrights, etc.) purchased with HHAP-3 funds received under the terms of this Contract which has a life expectancy of one (1) year or more shall be the property of the County and shall be subject to the provisions of this paragraph. The disposition of equipment or property of any kind shall be determined by the County when the Contract is terminated.

Additional terms are as follows:
a. The purchase of any furniture or equipment which was not included in Contractor’s approved budget, shall require the prior written approval of the County, and shall fulfill the provisions of this Contract which are appropriate and directly related to Contractor’s services or activities under the terms of the Contract. The County may refuse approval for any cost resulting from such items purchased, which are incurred by Contractor, if prior written approval has not been obtained from the County.
b. Before equipment purchases made by Contractor are approved by the County, Contractor must submit paid vendor receipts identifying the purchase price, description of the item, serial numbers, model number and location where equipment will be used during the term of this Contract. c. Contractor shall submit an inventory of equipment purchased under the terms of this Contract as part of the expenditures report for the month in which the equipment is purchased. Contractor must also maintain an inventory of equipment purchased that, at a minimum, includes the description of the property, serial number or other identification number, title holder, acquisition date, cost of the equipment, location, use and condition of the property, and ultimate disposition data. A physical inventory of the property must be reconciled annually. Equipment should be adequately maintained and a control system in place to prevent loss, damage, or theft. Equipment with cost exceeding County’s capitalization threshold of $5,000 must be depreciated.
d. No costs incurred prior to the Contract commencement date shall be eligible for reimbursement with HHAP-3 funds.
e. Upon termination of this Contract, Contractor will provide a final inventory to the County and shall at that time query the County as to requirements, including the manner and method in returning equipment to the County. Final disposition of such equipment shall be in accordance with instructions from the County.

B.3.4 Financial Management
a. Review, understanding, and certification that quarterly expenditure reports submitted to the County meet eligible expenses under HHAP-3 and State requirements. The County shall have no obligation to advance or pay Contractor with any funds other than HHAP-3 funds the County receives from the State. b. Contractor attests that by submitting a quarterly expenditures report to OHS, it has completed all due diligence necessary and verified eligibility for HHAP-3 funding.

Contractor shall be required to repay County for non-eligible expenditures that may inadvertently be processed by the County.
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c. Budget Changes – Contractor agrees that no changes shall be made to Contractor’s HHAP-3 budget without first obtaining approval. No more than the amounts specified in Exhibit 1 – HHAP-3 AWARD BY CATEGORY may be spent for the separate cost categories specified in the budget summary. Any changes to this Contract must be requested by Contractor in writing through OHS. Changes must be approved by the County and/or the State.
d. Documentation of Costs and Other Financial Reporting Contractor will be required to maintain books, records, documents, and other evidence directly related to the performance of work in accordance with Generally Acceptable Accounting Procedures. Costs shall be supported by properly executed payrolls, time records, invoices, receipts, vouchers or other official documentation, as evidence of the nature and propriety of the charges.

All accounting documents pertaining in whole or in part to this Contract shall be clearly identified and readily accessible, and upon reasonable notice, the County shall have the right to audit the records of the Contractor as they relate to the Contract and the activities and services described herein.

Contractor shall also:
1) Maintain an effective system of internal fiscal control and accountability for all HHAP-3 funds and property acquired or improved with HHAP-3 funds, and make sure the same are used solely for authorized purposes. 2) Keep a continuing record of all disbursements by date, payment method, amount, vendor, description of items purchased and line item from which the money was expended, as reflected in the Contractor’s accounting records.
3) Maintain payroll, financial, and expense reimbursement records for a minimum period of five (5) years after the termination of this Contract. 4) Permit inspection and audit of its records with respect to all matters authorized by this Contract by representatives of the County at any time during normal business hours and as often as necessary. 5) Inform the County concerning any funds allocated to Contractor, that the Contractor anticipates will not be expended during the term of this Contract. 6) Repay the County any funds in its possession at the time of the termination of this Contract that may be due to the County; e.g., ineligible costs, unexpended funds, etc.

B.3.5 Funding
a. This Contract is valid and enforceable only if sufficient funds are made available to County by legislative appropriation. In addition, this Contract is subject to any additional restrictions, limitations or conditions, or statutes, regulations or any other laws, whether Federal or those of the State, or of any agency, department, or any political subdivision of Federal or the State governments, which may affect the provisions, terms or funding of this Contract in any manner. b. Contractor must establish and maintain effective internal controls over all funding awarded to Contractor by the County to provide reasonable assurance that Contractor complies with Federal, State, and County statutes, regulations, and terms and conditions of the Contract.
c. County may base funding for Contractor upon positive performance outcomes, which OHS will monitor throughout the year.
d. Contractor must be able to demonstrate that HHAP-3 funds were expended for eligible uses to benefit members of the Target Population. e. Funds allocated pursuant to this Contract shall be used exclusively for costs included in Contractor’s Program budget. Contract funds shall not be used as 282
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security or to guarantee payments for any non-program obligations nor as loans for non-program activities.
f. Contractor certifies and agrees that it will not use funds provided through this Contract to pay for entertainment, gifts, or fundraising activities. g. Ineligible Costs – HHAP-3 funds shall not be used for costs associated with activities in violation of any law or for any activities not consistent with the intent of HHAP-3 and the eligible uses identified in California Health and Safety Code Sections 50218 and 50219.

The County or the State reserves the right to request additional information and clarification to determine the reasonableness and eligibility of all costs to be paid with funds made available by this Contract. If Contractor or its Subcontractors use HHAP-3 funds to pay for ineligible activities, Contractor shall be required to reimburse these funds to the County within thirty (30) days of the request. 1) An expenditure which is not authorized by this Contract, or which cannot be adequately documented, shall be disallowed and must be reimbursed to the County by Contractor.
2) The State, at its sole and reasonable discretion, shall make the final determination regarding the allowability of expenditures of HHAP-3 funds. 3) Program funds shall not be used to supplant existing local funds for homeless housing, assistance, or prevention. HHAP-3 funds cannot replace local funds that are committed to an existing or developing homeless assistance program. However, if funds previously supporting a service or project end or are reduced for reasons beyond the control of Contractor and services or housing capacity will be lost as a result of these funds ending, HHAP-3 funds may be used to maintain the service or program and are not considered supplanting [examples include, but are not limited to, a time-limited city and/or county tax or one-time block grant, such as Homeless Emergency Aid Program (HEAP) grant].
h. Contractor must expend:
1) No less than fifty percent (50%) of HHAP-3 funds by May 31, 2024; 2) One hundred percent (100%) of HHAP-3 funds by June 30, 2026; and “Expend” means all HHAP-3 funds obligated under this Contract have been fully paid and receipted, and no invoices remain outstanding.” Reports submitted by the Contractor will be used to ensure that Contractor is on track to expend fifty percent (50%) of HHAP-3 funds by May 31, 2024 and one hundred percent (100%) of HHAP-3 funds by June 30, 2026. Contractor may submit a request to OHS prior to May 31, 2024 if Contractor is not on track to expend 50% of the HHAP-3 funds by May 31, 2024 proposing an alternative expenditure rate to meet the June 20, 2026 100% expenditure deadline with justification. The Chief of Homeless Services may approve, modify, or deny such request.

If, by January 1, 2026, Contractor has not submitted reports showing an expenditure of at least eighty percent (80%) of the HHAP-3 funds, the remaining twenty percent (20%) will be returned and reallocated.
i. HHAP-3 funds may not be obligated and expended prior to the effective date of this Contract. “Obligate” means that Contractor has placed orders, entered into sub-contracts, received services, or entered into similar transactions that require payment from the Contract award.
j. All proceeds from any interest-bearing account established by the Contractor for the deposit of HHAP-3 funds must be used for HHAP-eligible activities.

Documentation of all expenditures and accrued interest shall be reported on the forms provided by OHS (i.e., Exhibit 7 – HHAP-3 Expenditure Report). 283
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k. Any housing-related activities funded with HHAP-3 funds, including but not limited to, emergency shelter, rapid-rehousing, rental assistance, transitional housing and permanent supportive housing must be in compliance or otherwise aligned with the Core Components of Housing First, pursuant to Welfare and Institution Code Section 8255(b).
l. Contractor confirms that rental assistance will be issued directly to a property owner or an agent authorized to act on behalf of a property owner. m. Joint Funding – For all programs and services for which there are sources of funds in addition to County funds as provided under this Contract, Contractor shall provide proof of such funding. Contractor must be able to account for the receipt, obligation and expenditure of funds.

The County shall NOT pay for any services provided by Contractor which are funded by other sources. All restrictions and/or requirements provided in this Contract relative to accounting, budgeting, and reporting apply to the total program regardless of funding sources.
n. The County reserves the right to reduce the Contract award when the County’s fiscal monitoring indicates that Contractor’s rate of expenditure will result in unspent funds at the end of the Contract term or if it is determined that costs incurred are not in conformance with eligible costs as defined in Health and Safety Code Section 50214. Changes in the Contract award will be done after consultation with Contractor. Such changes shall be incorporated into this Contract by written amendment(s).

B.3.6 Fiscal Award Monitoring
a. The County has the right to monitor the Contract during the Contract period to ensure accuracy of expenditure reports and compliance with applicable laws and regulations.
b. Contractor agrees to furnish duly authorized representatives from the County and the State access to all financial records necessary to review or audit Contract services and to evaluate the cost, quality, and appropriateness of services. c. If the State or the County determines that all, or any part of, the payments made by the County to Contractor pursuant hereto are not eligible expenses in accordance with this Contract, said funds will be repaid by Contractor to the County. In the event such payment is not made on demand, the County may withhold future disbursements to Contractor until such disallowances are paid by Contractor. If disallowable expenses are not reimbursed within thirty (30) days of demand, the Contract will terminate without consultation at the County’s sole and absolute discretion.
d. If there is a conflict between a State audit of this Contract and a County audit of this Contract, the State audit shall take precedence.

B.3.7 Closeout
Contractor shall submit a closeout report including a narrative of the project outcomes, an inventory of all equipment and property acquired or improved by HHAP funds, and a final financial report, upon termination or completion of the services specified in this Contract.

Contractor agrees to adhere to and comply with all the closeout procedures detailed below; including, but not limited to the following:
a. Disposition of Program assets shall be determined by the County when the Contract is terminated.
b. Contractor shall submit within forty-five (45) days after the date of expiration of this Contract, all financial, performance, and other reports required by this Contract; and in addition, will cooperate in a Program audit by the County. 284
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c. Any unobligated/unexpended funds disbursed in advance to Contractor shall be returned to the County within thirty (30) days after the expiration of the Contract term, or in accordance with Section B.3.5.h, whichever occurs first. This term shall survive the expiration of the Contract.
d. Contractor must account for any real and personal property acquired with HHAP- 3 funds.
e. Closeout will remain pending until all requirements are met and all outstanding issues with the Contractor have been resolved to the satisfaction of the County.

B.3.8 Homeless Management Information System
The HMIS is a local database application used to collect client-level data and data on the provision of housing and services to homeless individuals and families and persons at risk of homelessness in the County. Contractor must ensure that data on all persons served are entered into the countywide HMIS. HMIS is managed and operated by OHS. HMIS technical and data standards are set forth in the Final 2017 HMIS Data Standards, on file with OHS.
a. Contractor shall enter into a Memorandum of Understanding (MOU) with the HMIS Lead Agency where the Contractor agrees to share HMIS data with other HHAP funded agencies, unless prohibited by law.
b. Contractor is required to work with OHS staff to ensure the timely and accurate set-up of their HMIS program profile and to ensure the HMIS program profile is setup in a manner that accurately captures the data pertinent to Contractor’s program. Contractor’s program profile must be setup prior to Contractor submitting their first HHAP Disbursement Request form.
c. Contractor shall submit a copy of HMIS reports (see Exhibit 4 – HMIS DATA REPORT SAMPLE) with the quarterly expenditure reports. In the case of Domestic Violence service providers or other agencies prohibited from entering data into HMIS, documentation from the HMIS lead agency certifying that the Contractor is using a comparable database shall be delivered to the County. The contact information for the "HMIS Lead Agency" is:

Robin Kennedy, HMIS Lead
San Bernardino County
Office of Homeless Services
560 E. Hospitality Ln., Ste. 200
San Bernardino CA 92415-0044
[email protected]
Phone: 909-501-0610
d. Contractor must ensure all required data elements, as listed below, are entered into the HMIS system for HHAP-3 participants, in a timely manner, and is inputted no later than two (2) working days after program entry. Services rendered to clients must be entered into HMIS no later than two (2) working days from date of service(s). All clients who exit the program must have an updated status in HMIS within two (2) working days from actual exit date. Failure to meet the above data inputting requirements will constitute a violation of the terms and conditions of this Contract. Contractor will be notified by OHS, and if not rectified, the Contract may be terminated at the County’s sole and absolute discretion. e. In addition to the timely entry of HMIS data, Contractor is required to enter accurate and complete data. The County will ensure Contractor adheres to Data Quality Standards, as established by HUD, and data entry requirements, as set forth in the HMIS MOU and the OHS Policy Handbook. The Data Quality Standards assess the data quality and completeness of the following Data Elements entered:
1) Client Demographic Data
a) Name
b) Social Security Number
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c) Date of Birth
d) Race
e) Ethnicity
f) Gender
g) Veteran Status
2) Universal Data
a) Disabling Condition
b) Project Start Date
c) Project Exit Date
d) Destination
e) Relationship to Head of Household
f) Client Location
g) Housing Move-in Date
h) Living Situation
3) Common Program Specific Data Elements
a) Income and Sources
b) Non-Cash Benefits
c) Health Insurance
d) Disability Elements
e) Physical Disability
f) Developmental Disability
g) Chronic Health Condition
h) HIV/AIDS
i) Mental Health Problem
j) Substance Abuse
k) Domestic Violence
l) Contact
m) Date of Engagement
n) Bed-Night Date
o) Housing Assessment Disposition
4) Data Timeliness
a) Entry Timeliness
b) Exit Timeliness
f. According to Data Quality Standards, Contractor is required to have a five-percent (5%) or less error rate to ensure data accuracy and less than a five-day lapse in timeliness for entry of data at time of client entry, services are rendered, and client exit. Any performance benchmarks not meeting these standards will be captured on Contractor’s HMIS Data Quality Report Sample, see Exhibit 5. The report will be generated by Contractor and submitted quarterly with expenditure reports. OHS will review reports and data deficiencies, if any, will be identified and discussed with Contractor to determine methods to remediate and/or improve data quality scores.
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g. If Contractor continues to not meet data entry and data quality benchmarks, as established by HUD and set forth in the HMIS MOU and the OHS Policy Handbook, County may terminate Contract as set forth in CORRECTION OF PERFORMANCE DEFICIENCIES Section.
h. Contractor agrees to provide the County and/or the State access to HMIS data collected and entered into HMIS, upon request, and to participate in any statewide data initiative as directed by the State including, but not limited to, a statewide data integration environment.

B.3.9 Housing First
The methodology of providing services will follow the Housing First policy. This is an approach that offers permanent, affordable housing as quickly as possible for individuals and families experiencing homelessness, and then provides the supportive services and connections to the community-based supports people need to avoid returning to homelessness. HHAP projects must align and comply with the core components of Housing First as defined in California Welfare and Institutions Code Section 8255(b) (see Exhibit 6).

B.3.10 Program Participant Eligibility
Contractor shall ensure that:
a. HHAP-3 participants meet the Homeless definition as defined in Section 578.3 of Title 24 of the Code of Federal Regulations:
1) An individual or family who lacks a fixed, regular, and adequate nighttime residence, meaning:
a) An individual or family with a primary nighttime residence that is a public or private place not designed for or ordinarily used as a regular sleeping accommodation for human beings, including a car, park, abandoned building, bus or train station, airport, or camping ground;
b) An individual or family living in a supervised publicly or privately- operated shelter designated to provide temporary living arrangements (including congregate shelters, transitional housing, and hotels and motels paid for by charitable organizations or by Federal, State and local government programs for low-income individuals); or
c) An individual who is exiting an institution where he or she resided for 90 days or less and who resided in an emergency shelter or place not meant for human habitation immediately before entering that institution.
2) An individual or family who will imminently lose their primary nighttime residence, provided that:
a) The primary nighttime residence will be lost within 14 days of the date of application for homeless assistance;
b) No subsequent residence has been identified; and
c) The individual or family lacks the resources or support networks, e.g., family, friends, faith-based or other social networks, needed to obtain other permanent housing;
3) Unaccompanied youth under 25 years of age, or families with children and youth, who do not otherwise qualify as homeless under this definition, but who:
a) Are defined as homeless under Section 387 of the Runaway and Homeless Youth Act (42 U.S.C. 5732a), Section 637 of the Head Start Act (42 U.S.C. 9832), Section 41403 of the Violence Against 287
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Women Act of 1994 (42 U.S.C. 14043e-2), Section 330(h) of the Public Health Service Act (42 U.S.C. 254b(h)), Section 3 of the Food and Nutrition Act of 2008 (7 U.S.C. 2012), Section 17(b) of the Child Nutrition Act of 1966 (42 U.S.C. 1786(b)), or Section 725 of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11434a);
b) Have not had a lease, ownership interest, or occupancy agreement in permanent housing at any time during the 60 days immediately preceding the date of application for homeless assistance; c) Have experienced persistent instability as measured by two moves or more during the 60-day period immediately preceding the date of applying for homeless assistance; and
d) Can be expected to continue in such status for an extended period of time because of chronic disabilities; chronic physical health or mental health conditions; substance addiction; histories of domestic violence or childhood abuse (including neglect); the presence of a child or youth with a disability; or two or more barriers to employment, which include the lack of a high school degree or General Education Development (GED), illiteracy, low English proficiency, a history of incarceration or detention for criminal activity, and a history of unstable employment; or
4) Any individual or family who:
a) Is fleeing, or is attempting to flee, domestic violence, dating violence, sexual assault, stalking, or other dangerous or life- threatening conditions that relate to violence against the individual or a family member, including a child, that has either taken place within the individual's or family's primary nighttime residence or has made the individual or family afraid to return to their primary nighttime residence;
b) Has no other residence; and
c) Lacks the resources or support networks, e.g., family, friends, and faith-based or other social networks, to obtain other permanent housing.
b. HHAP-3 participants are referred by CES to Contractor. c. Contractor coordinates Program enrollment and services in collaboration with CES.

B.3.11 Job Training and Employment
Contractor agrees to refer HHAP-3 clients that are eligible for job training and employment services to the County of San Bernardino Workforce Development Department (WDD).

Contractor also agrees to refer eligible “work ready” clients to the County’s Community Employment Pathways (CEP) program for job placement services. Number of participants who have been referred to WDD and CEP will be reported on a quarterly basis by Contractor.

B.3.12 Staffing Requirements
Contractor shall provide the necessary professional staff to meet the needs of the homeless population following the Housing First model (ex. Case managers, Clinicians, medical staff, peer advocates, employment specialists, and eligibility specialists).

Contractor must have the readiness capacity to immediately perform and administer homeless efforts through HHAP funding.

C. GENERAL CONTRACT REQUIREMENTS
C.1 Recitals
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The recitals set forth above are true and correct and incorporated herein by this reference.

C.2 Contract Amendments
Contractor agrees any alterations, variations, modifications, or waivers of the provisions of the Contract, shall be valid only when reduced to writing, executed and attached to the original Contract and approved by the person(s) authorized to do so on behalf of Contractor and County.

C.3 Contract Assignability
Without the prior written consent of the County, the Contract is not assignable by Contractor either in whole or in part.

C.4 Contract Exclusivity
This is not an exclusive Contract. The County reserves the right to enter into a contract with other contractors for the same or similar services. The County does not guarantee or represent that the Contractor will be permitted to perform any minimum amount of work, or receive compensation other than on a per order basis, under the terms of this Contract.

C.5 Attorney’s Fees and Costs
If any legal action is instituted to enforce any party’s rights hereunder, each party shall bear its own costs and attorney’s fees, regardless of who is the prevailing party. This paragraph shall not apply to those costs and attorney’s fees directly arising from a third-party legal action against a party hereto and payable under Indemnification and Insurance Requirements.

C.6 Background Checks for Contractor Personnel
Contractor shall ensure that its personnel (a) are authorized to work in the jurisdiction in which they are assigned to perform Services; (b) do not use legal or illegal substances in any manner which will impact their ability to provide Services to the County; and (c) are not otherwise disqualified from performing the Services under applicable law. If requested by the County and not in violation of applicable law, Contractor shall conduct a background check, at Contractor’s sole expense, on all its personnel providing Services. If requested by the County, Contractor shall provide the results of the background check of each individual to the County. Such background check shall be in the form generally used by Contractor in its initial hiring of employees or contracting for contractors or, as applicable, during the employment-screening process but must, at a minimum, have been performed within the preceding 12-month period. Contractor personnel who do not meet the County’s hiring criteria, in County’s sole discretion, shall not be assigned to work on County property or Services, and County shall have the right, at its sole option, to refuse access to any Contract personnel to any County facility.

C.7 Change of Address
Contractor shall notify the County in writing, of any change in mailing address within ten (10) business days of the change.

C.8 Choice of Law
This Contract shall be governed by and construed according to the laws of the State of California.

C.9 Compliance with County Policy
In performing the Services and while at any County facilities, Contractor personnel (including subcontractors) shall (a) conduct themselves in a businesslike manner; (b) comply with the policies, procedures, and rules of the County regarding health and safety, and personal, professional and ethical conduct; (c) comply with the finance, accounting, banking, Internet, security, and/or other applicable standards, policies, practices, processes, procedures, and controls of the County; and (d) abide by all laws applicable to the County facilities and the provision of the Services, and all amendments and modifications to each of the documents listed in subsections (b), (c), and (d) (collectively, “County Policies”). County Policies, and additions or modifications thereto, may be communicated orally or in writing to Contractor or Contractor personnel or may be made available to Contractor or Contractor personnel by conspicuous 289
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posting at a County facility, electronic posting, or other means generally used by County to disseminate such information to its employees or contractors. Contractor shall be responsible for the promulgation and distribution of County Policies to Contractor personnel to the extent necessary and appropriate.

County shall have the right to require Contractor’s employees, agents, representatives and subcontractors to exhibit identification credentials issued by County in order to exercise any right of access under this Contract.

C.10 Confidentiality
Contractor shall protect from unauthorized use or disclosure the names and other identifying information concerning persons receiving Services pursuant to this Contract, except for statistical information not identifying any participant. Contractor shall not use or disclose any identifying information for any purpose other than carrying out the Contractor's obligations under this Contract, except as may otherwise be required by law. This provision will remain in force even after the termination of the Contract.

C.11 Primary Point of Contact
Contractor will designate an individual to serve as the primary point of contact for the Contract.

Contractor or designee must respond to County inquiries within two (2) business days. Contractor shall not change the primary contact without written acknowledgement to the County. Contractor will also designate a back-up point of contact in the event the primary contact is not available.

C.12 County Representative
The Director of Community Development and Housing or his/her designee shall represent the County in all matters pertaining to the services to be rendered under this Contract, including termination and assignment of this Contract, and shall be the final authority in all matters pertaining to the Services/Scope of Work by Contractor. If this contract was initially approved by the San Bernardino County Board of Supervisors, then the Board of Supervisors must approve all amendments to this Contract.

C.13 Damage to County Property
Contractor shall repair, or cause to be repaired, at its own cost, all damages to County vehicles, facilities, buildings or grounds caused by the willful or negligent acts of Contractor or its employees or agents. Such repairs shall be made immediately after Contractor becomes aware of such damage, but in no event later than thirty (30) days after the occurrence.

If the Contractor fails to make timely repairs, the County may make any necessary repairs. The Contractor, as determined by the County, shall repay all costs incurred by the County for such repairs, by cash payment upon demand, or County may deduct such costs from any amounts due to the Contractor from the County, as determined at the County’s sole discretion.

C. 14 Debarment and Suspension
Contractor certifies that neither it nor its principals or subcontractors is presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from participation in this transaction by any federal department or agency. (See the following United States General Services Administration’s System for Award Management website https://www.sam.gov).

Contractor further certifies that if it or any of its subcontractors are business entities that must be registered with the California Secretary of State, they are registered and in good standing with the Secretary of State.

C.15 Drug and Alcohol Free Workplace
In recognition of individual rights to work in a safe, healthful and productive work place, as a material condition of this Contract, the Contractor agrees that the Contractor and the Contractor’s employees, while performing service for the County, on County property, or while using County equipment:
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C.15.1 Shall not be in any way impaired because of being under the influence of alcohol or an illegal or controlled substance.

C.15.2 Shall not possess an open container of alcohol or consume alcohol or possess or be under the influence of an illegal or controlled substance.

C.15.3 Shall not sell, offer, or provide alcohol or an illegal or controlled substance to another person, except where Contractor or Contractor’s employee who, as part of the performance of normal job duties and responsibilities, prescribes or administers medically prescribed drugs.

The Contractor shall inform all employees that are performing service for the County on County property, or using County equipment, of the County’s objective of a safe, healthful and productive work place and the prohibition of drug or alcohol use or impairment from same while performing such service for the County.

The County may terminate for default or breach of this Contract and any other Contract the Contractor has with the County, if the Contractor or Contractor’s employees are determined by the County not to be in compliance with above.

C.16 Duration of Terms
This Contract, and all of its terms and conditions, shall be binding upon and shall inure to the benefit of the heirs, executors, administrators, successors, and assigns of the respective parties, provided no such assignment is in violation of the provisions of this Contract.

C.17 Employment Discrimination
During the term of the Contract, Contractor shall not discriminate against any employee or applicant for employment because of race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, genetic information, marital status, sex, gender, gender identity, gender expression, sexual orientation, age, or military and veteran status.

Contractor shall comply with Executive Orders 11246, 11375, 11625, 12138, 12432, 12250, 13672, Title VI and Title VII of the Civil Rights Act of 1964, the California Fair Employment and Housing Act and other applicable Federal, State and County laws and regulations and policies relating to equal employment and contracting opportunities, including laws and regulations hereafter enacted.

C.18 Environmental Requirements
In accordance with County Policy 11-08, the County prefers to acquire and use products with higher levels of post-consumer recycled content. Environmentally preferable goods and materials must perform satisfactorily and be available at a reasonable price. The County requires Contractor to use recycled paper for any printed or photocopied material created as a result of this Contract. Contractor is also required to use both sides of paper sheets for reports submitted to the County whenever practicable.

To assist the county in meeting the reporting requirements of the California Integrated Waste Management Act of 1989 (AB 939), Contractor must be able to annually report the County’s environmentally preferable purchases. Contractor must also be able to report on environmentally preferable goods and materials used in the provision of their service to the County, utilizing a County approved form.

C.19 Improper Influence
Contractor shall make all reasonable efforts to ensure that no County officer or employee, whose position in the County enables him/her to influence any award of the Contract or any competing offer, shall have any direct or indirect financial interest resulting from the award of the Contract or shall have any relationship to the Contractor or officer or employee of the Contractor. 291
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C.20 Improper Consideration
Contractor shall not offer (either directly or through an intermediary) any improper consideration such as, but not limited to cash, discounts, service, the provision of travel or entertainment, or any items of value to any officer, employee or agent of the County in an attempt to secure favorable treatment regarding this Contract.

The County, by written notice, may immediately terminate this Contract if it determines that any improper consideration as described in the preceding paragraph was offered to any officer, employee or agent of the County with respect to the proposal and award process. This prohibition shall apply to any amendment, extension or evaluation process once a contract has been awarded.

Contractor shall immediately report any attempt by a County officer, employee or agent to solicit (either directly or through an intermediary) improper consideration from Contractor. The report shall be made to the supervisor or manager charged with supervision of the employee or the County Administrative Office. In the event of a termination under this provision, the County is entitled to pursue any available legal remedies.

C.21 Informal Dispute Resolution
In the event the County determines that service is unsatisfactory, or in the event of any other dispute, claim, question or disagreement arising from or relating to this Contract or breach thereof, the parties hereto shall use their best efforts to settle the dispute, claim, question or disagreement.

To this effect, they shall consult and negotiate with each other in good faith and, recognizing their mutual interests, attempt to reach a just and equitable solution satisfactory to both parties.

C.22 Legality and Severability
The parties’ actions under the Contract shall comply with all applicable laws, rules, regulations, court orders and governmental agency orders. The provisions of this Contract are specifically made severable. If a provision of the Contract is terminated or held to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall remain in full effect.

C.23 Licenses, Permits and/or Certifications
Contractor shall ensure that it has all necessary licenses, permits and/or certifications required by the laws of Federal, State, County, and municipal laws, ordinances, rules and regulations. The Contractor shall maintain these licenses, permits and/or certifications in effect for the duration of this Contract. Contractor will notify County immediately of loss or suspension of any such licenses, permits and/or certifications. Failure to maintain a required license, permit and/or certification may result in immediate termination of this Contract.

C.24 Material Misstatement/Misrepresentation
If during the course of the administration of this Contract, the County determines that Contractor has made a material misstatement or misrepresentation or that materially inaccurate information has been provided to the County, this Contract may be immediately terminated. If this Contract is terminated according to this provision, the County is entitled to pursue any available legal remedies.

C.25 Mutual Covenants
The parties to this Contract mutually covenant to perform all of their obligations hereunder, to exercise all discretion and rights granted hereunder, and to give all consents in a reasonable manner consistent with the standards of “good faith” and “fair dealing”.

C.26 Nondisclosure
Contractor shall hold as confidential and use reasonable care to prevent unauthorized access by, storage, disclosure, publication, dissemination to and/or use by third parties of, confidential information that is either: (1) provided by the County to Contractor or an agent of Contractor or 292
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otherwise made available to Contractor or Contractor’s agent in connection with this Contract; or, (2) acquired, obtained, or learned by Contractor or an agent of Contractor in the performance of this Contract. For purposes of this provision, confidential information means any data, files, software, information or materials in oral, electronic, tangible or intangible form and however stored, compiled or memorialize and includes, but is not limited to, technology infrastructure, architecture, financial data, trade secrets, equipment specifications, user lists, passwords, research data, and technology data.

C.27 Notice of Delays
Except as otherwise provided herein, when either party has knowledge that any actual or potential situation is delaying or threatens to delay the timely performance of this contract, that party shall, within twenty-four (24) hours, give notice thereof, including all relevant information with respect thereto, to the other party.

C.28 Ownership of Documents
All documents, data, products, graphics, computer programs and reports prepared by Contractor pursuant to the Contract shall be considered property of the County upon payment for services (and products, if applicable). All such items shall be delivered to County at the completion of work under the Contract, subject to the requirements of Section IV–Term of the Contract. Unless otherwise directed by County, Contractor may retain copies of such items.

C.29 Reserved
C.30 Air, Water Pollution Control, Safety and Health
Contractor shall comply with all air pollution control, water pollution, safety and health ordinances and statutes, which apply to the work performed pursuant to this Contract.

C.31 Records
Contractor shall maintain all records and books pertaining to the delivery of services under this Contract and demonstrate accountability for contract performance. All records shall be complete and current and comply with all Contract requirements. Failure to maintain acceptable records shall be considered grounds for withholding of payments for invoices submitted and/or termination of the Contract.

All records relating to the Contractor’s personnel, consultants, subcontractors, Services/Scope of Work and expenses pertaining to this Contract shall be kept in a generally acceptable accounting format. Records should include primary source documents. Fiscal records shall be kept in accordance with Generally Accepted Accounting Principles and must account for all funds, tangible assets, revenue and expenditures. Fiscal records must comply with the appropriate Office of Management and Budget (OMB) Circulars, which state the administrative requirements, cost principles and other standards for accountancy.

C.32 Relationship of the Parties
Nothing contained in this Contract shall be construed as creating a joint venture, partnership, or employment arrangement between the Parties hereto, nor shall either Party have the right, power or authority to create an obligation or duty, expressed or implied, on behalf of the other Party hereto.

C.33 Release of Information
No news releases, advertisements, public announcements or photographs arising out of the Contract or Contractor’s relationship with County may be made or used without prior written approval of the County.

C.34 Representation of the County
In the performance of this Contract, Contractor, its agents and employees, shall act in an independent capacity and not as officers, employees, or agents of the San Bernardino County. 293
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C.35 Strict Performance
Failure by a party to insist upon the strict performance of any of the provisions of this Contract by the other party, or the failure by a party to exercise its rights upon the default of the other party, shall not constitute a waiver of such party’s right to insist and demand strict compliance by the other party with the terms of this Contract thereafter.

C.36 Subcontracting
Contractor shall obtain County’s written consent, which County may withhold in its sole discretion, before entering into Contracts with or otherwise engaging any subcontractors who may supply any part of the Services to County. At County’s request, Contractor shall provide information regarding the subcontractor’s qualifications and a listing of a subcontractor’s key personnel including, if requested by the County, resumes of proposed subcontractor personnel. Contractor shall remain directly responsible to County for its subcontractors and shall indemnify County for the actions or omissions of its subcontractors under the terms and conditions specified in Section G. All approved subcontractors shall be subject to the provisions of this Contract applicable to Contractor Personnel.

For any subcontractor, Contractor shall:

36.1 Be responsible for subcontractor compliance with the Contract and the subcontract terms and conditions; and

36.2 Ensure that the subcontractor follows County’s reporting formats and procedures as specified by County.

36.3 Include in the subcontractor’s subcontract substantially similar terms as are provided in Sections B. Contractor Responsibilities and C. General Contract Requirements.

Upon expiration or termination of this Contract for any reason, County will have the right to enter into direct Contracts with any of the Subcontractors. Contractor agrees that its arrangements with Subcontractors will not prohibit or restrict such Subcontractors from entering into direct Contracts with County.

C. 37 Subpoena
In the event that a subpoena or other legal process commenced by a third party in any way concerning the Goods or Services provided under this Contract is served upon Contractor or County, such party agrees to notify the other party in the most expeditious fashion possible following receipt of such subpoena or other legal process. Contractor and County further agree to cooperate with the other party in any lawful effort by such other party to contest the legal validity of such subpoena or other legal process commenced by a third party as may be reasonably required and at the expense of the party to whom the legal process is directed, except as otherwise provided herein in connection with defense obligations by Contractor for County.

C.38 Termination for Convenience
The County reserves the right to terminate the Contract, for any reason, with a thirty (30) day written notice of termination. Such termination may include all or part of the services described herein. Upon such termination, payment will be made to the Contractor for services rendered and expenses reasonably incurred prior to the effective date of termination. Upon receipt of termination notice Contractor shall promptly discontinue services unless the notice directs otherwise. Contractor shall deliver promptly to County and transfer title (if necessary) all completed work, and work in progress, including drafts, documents, plans, forms, data, products, graphics, computer programs and reports.

C.39 Time of the Essence
Time is of the essence in performance of this Contract and of each of its provisions.

C.40 Venue
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The parties acknowledge and agree that this Contract was entered into and intended to be performed in San Bernardino County, California. The parties agree that the venue of any action or claim brought by any party to this Contract will be the Superior Court of California, San Bernardino County, San Bernardino District. Each party hereby waives any law or rule of the court, which would allow them to request or demand a change of venue. If any action or claim concerning this Contract is brought by any third party and filed in another venue, the parties hereto agree to use their best efforts to obtain a change of venue to the Superior Court of California, San Bernardino County, San Bernardino District.

C.41 Conflict of Interest
Contractor shall make all reasonable efforts to ensure that no conflict of interest exists between its officers, employees, or subcontractors and the County. Contractor shall make a reasonable effort to prevent employees, Contractor, or members of governing bodies from using their positions for purposes that are, or give the appearance of being motivated by a desire for private gain for themselves or others such as those with whom they have family business, or other ties.

Officers, employees, and agents of cities, counties, districts, and other local agencies are subject to applicable conflict of interest codes and state law. In the event the County determines a conflict of interest situation exists, any increase in costs, associated with the conflict of interest situation, may be disallowed by the County and such conflict may constitute grounds for termination of the Contract. This provision shall not be construed to prohibit employment of persons with whom Contractor’s officers, employees, or agents have family, business, or other ties so long as the employment of such persons does not result in increased costs over those associated with the employment of any other equally qualified applicant.

C.42 Former County Administrative Officials
Contractor agrees to provide, or has already provided information on former San Bernardino County administrative officials (as defined below) who are employed by or represent Contractor.

The information provided includes a list of former County administrative officials who terminated County employment within the last five years and who are now officers, principals, partners, associates or members of the business. The information also includes the employment with or representation of Contractor. For purposes of this provision, “County administrative official” is defined as a member of the Board of Supervisors or such officer’s staff, County Executive Officer or member of such officer’s staff, County department or group head, assistant department or group head, or any employee in the Exempt Group, Management Unit or Safety Management Unit.

C.43 Disclosure of Criminal and Civil Procedures
The County reserves the right to request the information described herein from the Contractor.

Failure to provide the information may result in a termination of the Contract. The County also reserves the right to obtain the requested information by way of a background check performed by an investigative firm. The Contractor also may be requested to provide information to clarify initial responses. Negative information discovered may result in Contract termination.

Contractor is required to disclose whether the firm, or any of its partners, principals, members, associates or key employees (as that term is defined herein), within the last ten years, has been indicted on or had charges brought against it or them (if still pending) or convicted of any crime or offense arising directly or indirectly from the conduct of the firm’s business, or whether the firm, or any of its partners, principals, members, associates or key employees, has within the last ten years, been indicted on or had charges brought against it or them (if still pending) or convicted of any crime or offense involving financial misconduct or fraud. If the response is affirmative, the Contractor will be asked to describe any such indictments or charges (and the status thereof), convictions and the surrounding circumstances in detail.

In addition, the Contractor is required to disclose whether the firm, or any of its partners, principals, members, associates or key employees, within the last ten years, has been the subject of legal proceedings as defined herein arising directly from the provision of services by the firm or those 295
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individuals. “Legal proceedings” means any civil actions filed in a court of competent jurisdiction, or any matters filed by an administrative or regulatory body with jurisdiction over the firm or the individuals. If the response is affirmative, the Contractor will be asked to describe any such legal proceedings (and the status and disposition thereof) and the surrounding circumstances in detail.

For purposes of this provision “key employees” includes any individuals providing direct service to the County. “Key employees” do not include clerical personnel providing service at the firm’s offices or locations.

C.44 Reserved
C.45 Reserved
C.46 Iran Contracting Act
IRAN CONTRACTING ACT OF 2010, Public Contract Code sections 2200 et seq. (Applicable for all Contracts of one million dollars ($1,000,000) or more). In accordance with Public Contract Code section 2204(a), the Contractor certifies that at the time the Contract is signed, the Contractor signing the Contract is not identified on a list created pursuant to subdivision (b) of Public Contract Code section 2203 as a person (as defined in Public Contract Code section 2202(e)) engaging in investment activities in Iran described in subdivision (a) of Public Contract Code section 2202.5, or as a person described in subdivision (b) of Public Contract Code section 2202.5, as applicable.

Contractors are cautioned that making a false certification may subject the Contractor to civil penalties, termination of existing contract, and ineligibility to bid on a contract for a period of three (3) years in accordance with Public Contract Code section 2205.

C.47 Reserved
C.48 Reserved
C.49 Reserved
C.50 Executive Order N-6-22 Russia Sanctions
On March 4, 2022, Governor Gavin Newsom issued Executive Order N-6-22 (the EO) regarding Economic Sanctions against Russia and Russian entities and individuals. “Economic Sanctions” refers to sanctions imposed by the U.S. government in response to Russia’s actions in Ukraine (https://home.treasury.gov/policy-issues/financial-sanctions/sanctions-programs-and-country- information/ukraine-russia-related-sanctions), as well as any sanctions imposed under state law (https://www.dgs.ca.gov/OLS/Ukraine-Russia). The EO directs state agencies and their contractors (including by agreement or receipt of a grant) to terminate contracts with, and to refrain from entering any new contracts with, individuals or entities that are determined to be a target of Economic Sanctions. Accordingly, should it be determined that Contractor is a target of Economic Sanctions or is conducting prohibited transactions with sanctioned individuals or entities, that shall be grounds for termination of this agreement. Contractor shall be provided advance written notice of such termination, allowing Contractor at least 30 calendar days to provide a written response.

Termination shall be at the sole discretion of the County.

C.51 Reserved
C.52 Reserved
D. TERM OF CONTRACT
This Contract is effective as of October 3, 2023 and expires June 30, 2026 but may be terminated earlier in accordance with provisions of this Contract.
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E. COUNTY RESPONSIBILITIES
E.1 OHS shall provide technical assistance to Contractor.

E.2 OHS shall participate in evaluating the progress of the overall program.

E.3 OHS shall monitor Contractor on a regular basis in regard to compliance with Contractual requirements.

F. FISCAL PROVISIONS
F.1 The maximum amount of payment under this Contract shall not exceed $135,000 and shall be subject to availability of other funds to the County. The consideration to be paid to Contractor, as provided herein, shall be in full payment for all Contractor’s services and expenses incurred in the performance hereof, including travel and per diem.

F.2 Quarterly disbursements will be made to the Contractor based upon satisfactory performance under the terms of this Contract.

F.3 Contractor shall accept all payments from County via electronic funds transfer (EFT) directly deposited into the Contractor’s designated checking or other bank account. Contractor shall promptly comply with directions and accurately complete forms provided by County required to process EFT payments.

F.4 County is exempt from Federal excise taxes and no payment shall be made for any personal property taxes levied on Contractor or on any taxes levied on employee wages. The County shall only pay for any State or local sales or use taxes on the services rendered or equipment and/or parts supplied to the County pursuant to the Contract.

F.5 Costs for services under the terms of this Contract shall be incurred during the contract period except as approved by County. Contractor shall not use current year funds to pay prior or future year obligations.

F.6 Funds made available under this Contract shall not supplant any federal, state or any governmental funds intended for services of the same nature as this Contract. Contractor shall not claim reimbursement or payment from County for, or apply sums received from County with respect to that portion of its obligations that have been paid by another source of revenue.

Contractor agrees that it will not use funds received pursuant to this Contract, either directly or indirectly, as a contribution or compensation for purposes of obtaining funds from another revenue source without prior written approval of the County.

F.7 Contractor shall adhere to the County’s Travel Management Policy (8-02 and 08-02SP1) when travel is pursuant to this Contract and for which reimbursement is sought from the County. In addition, Contractor is encouraged to utilize local transportation services, including but not limited to, the Ontario International Airport.

G. INDEMNIFICATION AND INSURANCE REQUIREMENTS
G.1 Indemnification
The Contractor agrees to indemnify, defend (with counsel reasonably approved by County) and hold harmless the County and its authorized officers, employees, agents and volunteers from any and all claims, actions, losses, damages and/or liability arising out of this Contract from any cause whatsoever, including the acts, errors or omissions of any person and for any costs or expenses incurred by the County on account of any claim except where such indemnification is prohibited by law. This indemnification provision shall apply regardless of the existence or degree of fault of indemnities. The Contractor indemnification obligation applies to the County’s “active” as well as “passive” negligence but does not apply to the County’s “sole negligence” or “willful misconduct” within the meaning of Civil Code section 2782. 297
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G.2 Additional Insured
All policies, except for Worker’s Compensation, Errors and Omissions and Professional Liability policies shall contain additional endorsements naming the County and its officers, employees, agents and volunteers as additional named insured with respect to liabilities arising out of the performance of services hereunder. The additional insured endorsements shall not limit the scope of coverage for the County to vicarious liability but shall allow coverage for the County to the full extent provided by the policy. Such additional insured coverage shall be at least as broad as Additional Insured (Form B) endorsement form ISO, CG 2010.11 85.

G.3 Waiver of Subrogation Rights
The Contractor shall require the carriers of required coverages to waive all rights of subrogation against the County, its officers, employees, agents, volunteers, contractors and subcontractors.

All general or auto liability insurance coverage provided shall not prohibit the Contractor and Contractor’s employees or agents from waiving the right of subrogation prior to a loss or claim.

The Contractor hereby waives all rights of subrogation against the County.

G.4 Policies Primary and Non-Contributory
All policies required herein are to be primary and non-contributory with any insurance or self- insurance programs carried or administered by the County.

G.5 Severability of Interests
The Contractor agrees to ensure that coverage provided to meet these requirements is applicable separately to each insured and there will be no cross liability exclusions that preclude coverage for suits between the Contractor and the County or between the County and any other insured or additional insured under the policy.

G.6 Proof of Coverage
The Contractor shall furnish Certificates of Insurance to the County Department administering the Contract evidencing the insurance coverage at the time the Contract is executed, additional endorsements, as required shall be provided prior to the commencement of performance of services hereunder, which certificates shall provide that such insurance shall not be terminated or expire without thirty (30) days written notice to the Department, and Contractor shall maintain such insurance from the time Contractor commences performance of services hereunder until the completion of such services. Within fifteen (15) days of the commencement of this contract, the Contractor shall furnish a copy of the Declaration page for all applicable policies and will provide complete certified copies of the policies and endorsements immediately upon request.

G.7 Acceptability of Insurance Carrier
Unless otherwise approved by Risk Management, insurance shall be written by insurers authorized to do business in the State of California and with a minimum “Best” Insurance Guide rating of “A- VII”.

G.8 Deductibles and Self-Insured Retention
Any and all deductibles or self-insured retentions in excess of $10,000 shall be declared to and approved by Risk Management.

G.9 Failure to Procure Coverage
In the event that any policy of insurance required under this contract does not comply with the requirements, is not procured, or is canceled and not replaced, the County has the right but not the obligation or duty to cancel the contract or obtain insurance if it deems necessary and any premiums paid by the County will be promptly reimbursed by the Contractor or County payments to the Contractor will be reduced to pay for County purchased insurance.

G.10 Insurance Review
Insurance requirements are subject to periodic review by the County. The Director of Risk Management or designee is authorized, but not required, to reduce, waive or suspend any 298
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insurance requirements whenever Risk Management determines that any of the required insurance is not available, is unreasonably priced, or is not needed to protect the interests of the County. In addition, if the Department of Risk Management determines that heretofore unreasonably priced or unavailable types of insurance coverage or coverage limits become reasonably priced or available, the Director of Risk Management or designee is authorized, but not required, to change the above insurance requirements to require additional types of insurance coverage or higher coverage limits, provided that any such change is reasonable in light of past claims against the County, inflation, or any other item reasonably related to the County’s risk.

Any change requiring additional types of insurance coverage or higher coverage limits must be made by amendment to this contract. Contractor agrees to execute any such amendment within thirty (30) days of receipt.

Any failure, actual or alleged, on the part of the County to monitor or enforce compliance with any of the insurance and indemnification requirements will not be deemed as a waiver of any rights on the part of the County.

G.11 The Contractor agrees to provide insurance set forth in accordance with the requirements herein.

If the Contractor uses existing coverage to comply with these requirements and that coverage does not meet the specified requirements, the Contractor agrees to amend, supplement or endorse the existing coverage to do so.

Without in anyway affecting the indemnity herein provided and in addition thereto, the Contractor shall secure and maintain throughout the contract term the following types of insurance with limits as shown:

G.11.1 Workers’ Compensation/Employer’s Liability – A program of Workers’ Compensation insurance or a state-approved, self-insurance program in an amount and form to meet all applicable requirements of the Labor Code of the State of California, including Employer’s Liability with $250,000 limits covering all persons including volunteers providing services on behalf of the Contractor and all risks to such persons under this contract.

If Contractor has no employees, it may certify or warrant to the County that it does not currently have any employees or individuals who are defined as “employees” under the Labor Code and the requirement for Workers’ Compensation coverage will be waived by the County’s Director of Risk Management.

With respect to Contractors that are non-profit corporations organized under California or Federal law, volunteers for such entities are required to be covered by Workers’ Compensation insurance.

G.11.2 Commercial/General Liability Insurance – The Contractor shall carry General Liability Insurance covering all operations performed by or on behalf of the Contractor providing coverage for bodily injury and property damage with a combined single limit of not less than one million dollars ($1,000,000), per occurrence. The policy coverage shall include:
a. Premises operations and mobile equipment.
b. Products and completed operations.
c. Broad form property damage (including completed operations). d. Explosion, collapse and underground hazards.
e. Personal injury.
f. Contractual liability.
g. $2,000,000 general aggregate limit.
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G.11.3 Automobile Liability Insurance – Primary insurance coverage shall be written on ISO Business Auto coverage form for all owned, hired and non-owned automobiles or symbol 1 (any auto). The policy shall have a combined single limit of not less than one million dollars ($1,000,000) for bodily injury and property damage, per occurrence.

If the Contractor is transporting one or more non-employee passengers in performance of contract services, the automobile liability policy shall have a combined single limit of two million dollars ($2,000,000) for bodily injury and property damage per occurrence.

If the Contractor owns no autos, a non-owned auto endorsement to the General Liability policy described above is acceptable.

G.11.4 Umbrella Liability Insurance – An umbrella (over primary) or excess policy may be used to comply with limits or other primary coverage requirements. When used, the umbrella policy shall apply to bodily injury/property damage, personal injury/advertising injury and shall include a “dropdown” provision providing primary coverage for any liability not covered by the primary policy. The coverage shall also apply to automobile liability.

G.11.5 Professional Liability – Professional Liability Insurance with limits of not less than one million ($1,000,000) per claim and two million ($2,000,000) aggregate limits or
Errors and Omissions Liability Insurance – Errors and Omissions Liability Insurance with limits of not less than one million ($1,000,000) and two million ($2,000,000) aggregate limits
or
Directors and Officers Insurance coverage with limits of not less than one million ($1,000,000) shall be required for Contracts with charter labor committees or other not-for-profit organizations advising or acting on behalf of the County.

If insurance coverage is provided on a “claims made” policy, the “retroactive date” shall be shown and must be before the date of the state of the contract work. The claims made insurance shall be maintained or “tail” coverage provided for a minimum of five (5) years after contract completion.

G.11.6 Reserved
G.11.7 Abuse/Molestation Insurance – Contractor shall have abuse or molestation insurance providing coverage for all employees for the actual or threatened abuse or molestation by anyone of any person in the care, custody, or control of any insured, including negligent employment, investigation and supervision. The policy shall provide coverage for both defense and indemnity with liability limits of not less than one million dollars ($1,000,000) with a two million dollars ($2,000,000) aggregate limit.

H. RIGHT TO MONITOR AND AUDIT
H.1 The County, State and Federal government shall have absolute right to review and audit all records, books, papers, documents, corporate minutes, and other pertinent items as requested, and shall have absolute right to monitor the performance of Contractor in the delivery of services provided under this Contract. Contractor shall give full cooperation, in any auditing or monitoring conducted. Contractor shall cooperate with the County in the implementation, monitoring, and evaluation of this Contract and comply with any and all reporting requirements established by the County.
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H.2 All records pertaining to services delivered and all fiscal, statistical and management books and records shall be available for examination and audit by County representatives for a period of three years after final payment under this Contract or until all pending County, State and Federal audits are completed, whichever is later.

I. CORRECTION OF PERFORMANCE DEFICIENCIES
I.1 Failure by Contractor to comply with any of the provisions, covenants, requirements, or conditions of this Contract shall be a material breach of this Contract.

I.2 In the event of a non-cured breach, County may, at its sole discretion and in addition to any other remedies available at law, in equity, or otherwise specified in this Contract:
a. Afford Contractor thereafter a time period within which to cure the breach, which period shall be established at the sole discretion of County; and/or b. Discontinue reimbursement to Contractor for and during the period in which Contractor is in breach, which reimbursement shall not be entitled to later recovery; and/or c. Withhold funds pending duration of the breach; and/or d. Offset against any monies billed by Contractor but not yet paid by County those monies disallowed pursuant to Item “b” of this paragraph; and/or e. Terminate this Contract immediately and be relieved of the payment of any consideration to Contractor. In the event of such termination, the County may proceed with the work in any manner deemed proper by the County. The cost to the County shall be deducted from any sum due to the Contractor under this Contract and the balance, if any, shall be paid by the Contractor upon demand.

J. NOTICES
All written notices provided for in this Contract or which either party desires to give to the other shall be deemed fully given, when made in writing and either served personally, or by facsimile, or deposited in the United States mail, postage prepaid, and addressed to the other party as follows:

San Bernardino County
Office of Homeless Services
560 E. Hospitality Ln. Ste. 200
San Bernardino, CA 92415-0044
City of Ontario
Attn: Katryna Gonzalez
303 E. B St.

Ontario, CA 91764
Notice shall be deemed communicated two (2) County working days from the time of mailing if mailed as provided in this paragraph.

K. ENTIRE AGREEMENT
This Contract, including all Exhibits and other attachments, which are attached hereto and incorporated by reference, and other documents incorporated herein, represents the final, complete and exclusive agreement between the parties hereto. Any prior agreement, promises, negotiations or representations relating to the subject matter of this Contract not expressly set forth herein are of no force or effect. This Contract is executed without reliance upon any promise, warranty or representation by any party or any representative of any party other than those expressly contained herein. Each party has carefully read this Contract and signs the same of its own free will.

L. ELECTRONIC SIGNATURES
This Agreement may be executed in any number of counterparts, each of which so executed shall be deemedtobeanoriginal,andsuchcounterparts shalltogetherconstitute oneandthesameAgreement. The parties shall be entitledtosign andtransmitanelectronicsignatureofthisAgreement(whether byfacsimile, PDF or other mail transmission), which signature shall be binding on the party whose name is contained therein. Each party providing an electronic signature agrees to promptly execute and deliver to the other party an original signed Agreement upon request.
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IN WITNESS WHEREOF, San Bernardino County and the Contractor have each caused this Contract to be subscribed by its respective duly authorized officers, on its behalf.

FOR County USE ONLY
Approved as to Legal Form Reviewed for Contract Compliance Reviewed/Approved by Department Suzanne Bryant, Deputy County Counsel Carrie Harmon, Director Date Date Date
SAN BERNARDINO COUNTY City of Ontario
(Print or type name of corporation, company, contractor, etc.) By
Dawn Rowe, Chair, Board of Supervisors (Authorized signature - sign in blue ink) Dated: Name Scott Ochoa
SIGNED AND CERTIFIED THAT A COPY OF THIS (Print or type name of person signing contract)

DOCUMENT HAS BEEN DELIVERED TO THE
CHAIRMAN OF THE BOARD Title City Manager
Lynna Monell
Clerk of the Board of Supervisors
of the San Bernardino County
(Print or Type)
By Dated:

Deputy
Address 303 E. B St.

Ontario, CA 91764
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EXHIBIT 1 – AWARD BY CATEGORY
HHAP Award by Category
City of Ontario
October 3, 2023 through June 30, 2026
Eligible Use Category Award/Allocation Service Unit
Number Expected
to be Served
Rapid Rehousing: $121,500 Households 8
Operating Subsidies:

Street Outreach:

Services Coordination: $13,500 Households 8
Systems Support:

Delivery of Permanent Housing:

Prevention and shelter Diversion:

Interim sheltering:

Improvements to existing emergency shelters:

Homeless Youth (Countywide):

Total Award $135,000
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EXHIBIT 2 – SCOPE OF WORK
Contractor will operate a rapid rehousing program that will provide approximately 8 homeless households up to $15,000 in subsidies for up to six months ($121,500). The project budget reserves $1,688 per household for case management services and program support services, such as managing payments to property lessors.

Households will need to demonstrate that their income falls below 80% of area median income and that they would have sufficient income to sustain the fully charged rent when the subsidy ends.

Priority will be given to households with a disabled family member and families with children from the West Valley who are referred via the Coordinated Entry System (CES). In keeping with San Bernardino County Continuum of Care standards, RRH will be provided for individuals with Vulnerability Index – Service Prioritization Decision Assistance Tool (VI-SPDAT) scores between 4-7 and families with F-VI-SPDAT scores between 4 and 8.

Program process:
 Receive and evaluate CES referrals
 Within 2 business days, conduct initial eligibility verification, note outstanding questions for follow up o Enter any missing required information into HMIS [this is done throughout the process] o Schedule interview
 Meet with applicant, explain program, review required documents, complete application  Issue determination within 3 business days of completed application o If denied, staff will provide referrals to other resources  Enrollment meeting
o Issue Rapid Rehousing Coupon
o Review approval terms with client
o Update budget plan
o Discuss housing search strategy, adjust plans as needed o Set timeline for housing search activities
o Address any other potential barriers
 Housing Search Process
o Depending on client level of need, staff will provide an orientation on the following:
 Determining needs vs. wants in a housing unit How to find available housing units and how to find the right unit and neighborhood for their household  Rent limits and hidden costs
 Sustainability planning – how to afford the unit after the program ends  Applicability of fair housing laws
 What to expect in a lease agreement
o Staff will contact clients every 3-4 days to check on progress and share any information they have on unit vacancies.
o Unit found; initiate Request for Unit Approval. Housing Services staff will confirm:
 Unit meets rent reasonableness standards
 Lease agreement conforms to TBRA or State standards
 Tenant executes lease; owner, tenant, and City execute Rapid Rehousing Rental Assistance Agreement.
 Projected move-in date
 Continuum of Care team will assist client in identifying and addressing essential furnishing needs
 Maintenance
o Call or visit tenants to offer assistance;
o Gather and develop informational materials to advance participant housing stability, including ways to increase income, promote financial literacy and access programs that support wellness. 304
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EXHIBIT 3 – HHAP REPORTING REQUIREMENTS
A. Detailed reports containing, at minimum, the following information:

1. Amount awarded to Contractor with activity(ies) identified;

2. Contract expenditures;

3. Unduplicated number of homeless persons and households served by HHAP-3 funds;

4. Unduplicated number of persons and households at imminent risk of homelessness served by HHAP- 3 funds;

5. Number of instances of service;

6. Increases in capacity for new and existing programs;

7. Number of unsheltered homeless persons and homeless households becoming sheltered; and

8. Number of homeless persons and homeless households entering permanent housing.

9. Number of homeless persons and households successfully exited from HHAP-3 (i.e., in permanent housing) that remain in permanent housing 12 months post-exit from HHAP-3.

10. Number of persons and households at imminent risk of homelessness successfully exited from HHAP-3 (i.e., in permanent housing) that remain in permanent housing 12 months post-exit from HHAP-3.

B. Breakdowns will be expected for each activity (i.e., services, capital improvements, rental assistance, etc.) and program type (i.e. emergency shelter, rapid re-housing, outreach, etc.) for the supplemental reporting requirements listed above, when applicable. The same information will also be requested specifically for the following subpopulations, based on priorities defined by the U.S. Department of Housing and Urban Development:

1. Chronically homeless

2. Homeless veterans

3. Unaccompanied homeless youth

4. Homeless persons in families with children
C. Counts by subpopulation will not be required in cases where that information is unavailable, but is expected in cases where client information is entered in the Homeless Management Information System (HMIS). 305
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EXHIBIT 4 – HMIS CLIENT DATA REPORT SAMPLE
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EXHIBIT 5 – HMIS DATA QUALITY REPORT SAMPLE
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EXHIBIT 6
State of California

WELFARE AND INSTITUTIONS CODE
Section 8255
8255.

For purposes of this chapter:
(a) “Council” means the California Interagency Council on Homelessness, formerly known as the Homeless Coordinating and Financing Council established pursuant to Section 8257. (b) “Core components of Housing First” means all of the following:
(1) Tenant screening and selection practices that promote accepting applicants regardless of their sobriety or use of substances, completion of treatment, or participation in services. (2) Applicants are not rejected on the basis of poor credit or financial history, poor or lack of rental history, criminal convictions unrelated to tenancy, or behaviors that indicate a lack of “housing readiness.”
(3) Acceptance of referrals directly from shelters, street outreach, drop-in centers, and other parts of crisis response systems frequented by vulnerable people experiencing homelessness. (4) Supportive services that emphasize engagement and problem solving over therapeutic goals and service plans that are highly tenant-driven without predetermined goals. (5) Participation in services or program compliance is not a condition of permanent housing tenancy.
(6) Tenants have a lease and all the rights and responsibilities of tenancy, as outlined in California’s Civil, Health and Safety, and Government codes. (7) The use of alcohol or drugs in and of itself, without other lease violations, is not a reason for eviction.
(8) In communities with coordinated assessment and entry systems, incentives for funding promote tenant selection plans for supportive housing that prioritize eligible tenants based on criteria other than “first-come-first-serve,” including, but not limited to, the duration or chronicity of homelessness, vulnerability to early mortality, or high utilization of crisis services.

Prioritization may include triage tools, developed through local data, to identify high-cost, high-need homeless residents.
(9) Case managers and service coordinators who are trained in and actively employ evidence- based practices for client engagement, including, but not limited to, motivational interviewing and client-centered counseling.
(10) Services are informed by a harm-reduction philosophy that recognizes drug and alcohol use and addiction as a part of tenants’ lives, where tenants are engaged in nonjudgmental communication regarding drug and alcohol use, and where tenants are offered education regarding how to avoid risky behaviors and engage in safer practices, as well as connected to evidence-based treatment if the tenant so chooses.
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(11) The project and specific apartment may include special physical features that accommodate disabilities, reduce harm, and promote health and community and independence among tenants.
(c) “Homeless” has the same definition as that term is defined in Section 91.5 of Title 24 of the Code of Federal Regulations.
(d) (1) “Housing First” means the evidence-based model that uses housing as a tool, rather than a reward, for recovery and that centers on providing or connecting homeless people to permanent housing as quickly as possible. Housing First providers offer services as needed and requested on a voluntary basis and that do not make housing contingent on participation in services.
(2) (A) “Housing First” includes time-limited rental or services assistance, so long as the housing and service provider assists the recipient in accessing permanent housing and in securing longer term rental assistance, income assistance, or employment. (B) For time-limited, supportive services programs serving homeless youth, programs should use a positive youth development model and be culturally competent to serve unaccompanied youth under 25 years of age. Providers should work with the youth to engage in family reunification efforts, where appropriate and when in the best interest of the youth. In the event of an eviction, programs shall make every effort, which shall be documented, to link tenants to other stable, safe, decent housing options. Exit to homelessness should be extremely rare, and only after a tenant refuses assistance with housing search, location, and move-in assistance.
(e) “State programs” means any programs a California state agency or department funds, implements, or administers for the purpose of providing housing or housing-based services to people experiencing homelessness or at risk of homelessness, with the exception of federally funded programs with requirements inconsistent with this chapter. (Amended by Stats. 2021, Ch. 398, Sec. 3. (AB 1220) Effective January 1, 2022.) 310
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EXHIBIT 7
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Department: Economic Development
Prepared By: Karla Tavera
Staff Member Presenting:

Jennifer McLain Hiramoto, Economic
Development Director
Approved By:

Submitted To: Council/OHA
Approved: _______________________________
Continued To: ___________________________
Denied: __________________________________
Item No: 16
SUBJECT:

A RESOLUTION OF INTENTION TO RENEW THE DOWNTOWN ONTARIO

COMMUNITY BENEFIT DISTRICT AND TO LEVY AND COLLECT ASSESSMENTS

WITHIN DISTRICT

CITY OF ONTARIO
Agenda Report
November
7, 2023
SECTION:

CONSENT CALENDAR

RECOMMENDATION:

That the City Council take the following actions:

A
.

Adopt a Resolution of Intention to renew the Downtown Ontario Community Beneﬁt District and to levy and collect assessments within such District pursuant to California Streets and Highways Code 36600;
B
.

Direct Staﬀ to mail the notice of public hearing and assessment ballots to all aﬀected property owners within the proposed district boundaries.

THE FOLLOWING COUNCIL GOALS ARE BEING ACHIEVED:

Invest in the Growth and Evolution of the City's Economy Operate in a Businesslike Manner
Focus Resources in Ontario's Commercial and Residential Neighborhoods FISCAL IMPACT:

There is no immediate ﬁscal impact to the City associated with the subject recommendation and action.

BACKGROUND & ANALYSIS:

On August 20, 2019, the City Council conducted a public hearing to tabulate ballots for the formation of the Downtown Ontario Community Beneﬁts District (the "District"). Ballot Tabulation weighted majority in support of forming the District. In doing so, the District was established for a 5-year term. The District is now seeking to re-certify for a 10-year term. The objective of this proposition is to continue providing services and improvements that particularly beneﬁt downtown property owners by increasing economic activity, retail and business experience, and enhancing the value of commercial and retail property. The renewal of the District will be key in the continued revitalization efforts downtown.

Special Beneﬁt Districts are authorized by State Law under California Streets and Highway Code section 36600 in order to fund improvements and services that are over and beyond what City 313
services currently provide. Any special beneﬁt assessments paid by property owners solely fund improvements to the public rights of way directly surrounding those properties within the District, and by law, these funds cannot be used outside of the District boundaries or to replace existing City services.

Property owners, District board members, and Staﬀ were also invited to participate in a steering committee to help guide the types of services and improvements the District could oﬀer. The input of the steering committee was essential for the creation of a Management District Plan (Attachment A), which establishes the District boundaries (Attachment B), the method of calculating property assessment values, a District budget, and the types of services and improvements to be funded by the District. The Engineer’s Report (Attachment C), supporting the assessment, has been prepared by an assessment engineer, certiﬁed by the State of California as required by State law, and reviewed by the City Attorney.

Upon completion of the Management District Plan, a plan summary was mailed to each property owner in the proposed District, along with individual parcel assessments and a petition to renew the District. The support of property owners needed to be at least 50% of the assessed valuation within the District to trigger the Resolution of Intention. The petitions received weighted 52.44% in support therefore the City Council is able to adopt this Resolution of Intention to renew the District.

Upon the adoption of this Resolution of Intention, a public hearing will be scheduled for January 16,
2024
in order to receive written communication and hear public testimony regarding the renewal of the District and to calculate the results of the assessment ballots. If the weighted majority of returned, and not withdrawn, signed ballots support renewal of the District, the City Council may adopt a Resolution of Intention to renew the District and to levy the assessments on the beneﬁtting parcels.
314
1 The Proposed Renewal for the
Downtown Ontario Community Benefit District
(DOCBD)
Management District Plan
for the
Downtown Ontario Improvement Association
&
The City of Ontario
Being Renewed for a 10-year Term Pursuant to
California Streets and Highways Code Section 36600 et seq.

Property & Business Improvement District Act of 1994, as amended September 14, 2023
Corporate Office 2210 Columbia Street  San Diego, CA 92101  888-356-2726  619-233-5009  Midwest Office  300 N. State Street, Ste 4710  Chicago, Ill 60654 New England Office: 42 Pearl Street,  New Bedford, MA  02740 [email protected]  www.newcityamerica.com  Facebook: New City America, Inc. 315
2 TABLE OF CONTENTS
I. Management District Plan Summary – 3
II. DOCBD Boundaries – 7
III. Proposed 10-year DOCBD Work Plan and Budget – 11
IV. Proposed DOCBD Assessment Formula – 17
V. Publicly Owned Parcels – 23
VI. DOCBD District Governance – 26
VII. Proposed Rules and Regulation – 26
VIII. Other Items – 26
IX. Implementation Timetable – 27
Appendix 1: Year 1 – CBD Assessment Roll -29
Attachment 1: Certified Assessment Engineer’s Report
316
3 MANAGEMENT DISTRICT PLAN SUMMARY
Background:

Beginning in the summer of 2018, the City of Ontario worked with a group of motivated property owners to gauge support within the community for a new Special Benefits District for both the Downtown property owners and business community alike. The City of Ontario has hired New City America – a company specializing in Special Benefits District formation and district management - to work with the Downtown property owners to investigate the viability of a new Community Benefit District (CBD) in Downtown.

The property owners voted overwhelmingly in August of 2019 (pre-COVID) to support the establishment of this new Community Benefit District, formed under the provisions of Section 36600 of the California Streets and Highway Code. Due to its work during COVID as well as the success of its management and the introduction of new development in Downtown Ontario, the property owners have decided to renew the DOCBD, this time for the maximum ten year term, which would commence on January 1 st 2025. The documents shall serve as the renewal Management District Plan.

Accomplishments of the DOCBD Since its Formation:

Proposed Renewal Plan:

The Downtown Ontario CBD is a Property and Community Benefit District (DOCBD) being renewed for a 10-year period by the Owners Association, the Downtown Ontario Improvement Association Board within the CBD area. Understanding that the timeline for formation in time for Fiscal Year 2025 would be very challenging, property owners felt that the time had come for such a special benefits district and that these services would be needed to accommodate hundreds of new apartments as well as new businesses opening in 2023 - 24, and these services would be needed by the beginning of 2025.

The purpose of establishing this CBD is to provide and manage supplemental services and improvements for this important, historic and growing business center, including landscaping, beautification, marketing, district identity, safety, and administration services, programs and improvements. The DOCBD is a unique benefit assessment district that will enable the DOCBD property owners and businesses working as a unit, to fund needed property and business-related improvement programs, services and programs above what is provided by the City of Ontario.

Management Plan at a Glance:

Name: The name of the CBD is the Downtown Ontario Community Benefit District (DOCBD).

Management Entity: The Downtown Ontario Improvement Association (501c3) 317
4 Location: The proposed DOCBD is in the Downtown Ontario district along both sides of Euclid Avenue from the underpass just south of W. Emporia Street northward to the parcels to the south side of G Street. The western boundary is predominantly along North Palm Avenue, and the eastern boundary is predominantly along North Lemon Avenue.

Benefit Zones: There is one benefit zone within the proposed DOCBD. The boundaries of the benefit zone are coterminous with the boundaries of the proposed DOCBD.

Services: Civil Sidewalks, District Identity and Placemaking, Administration services, and Contingency. These services are proposed to be performed in the first year, and in each subsequent year, of the proposed DOCBD. 80% of the revenue generated by the proposed district will directly fund services to the property owners with less than 20% allocated to the oversight and administration of those services.

Finance: The financing of the CBD is based upon a benefit assessment of real property (204 parcels with 101 property owners). No bonds shall be issued to fund DOCBD programs.

Budget: CBD assessment revenue for Year 1 is projected to be $ 486,776. It is noted that the Assessment Engineer has determined that general benefits equate to 2% of the total adjusted CBD program costs of $496,710 or $ 9,934. General benefit costs shall be derived from non- assessment revenue sources such as grants, program income, credits, interest, memberships and other sources. Revenues from the assessment will increase by a maximum of 5% each year.

Year 1 – PROPOSED BUDGET (ASSESSMENT REVENUES/SPECIAL BENEFIT COSTS) Category of Special Benefit Services
2025
Approximate
Annual Amount
Approximate
Percentage of total
budget
Civil Sidewalks $ 290,000 60%
District Identity/Placemaking $ 96,000 20%
Administration $ 79,000 16%
Contingency $ 21,776 4%
Total $ 486,776 100%
Benefits: “General Benefit” is defined as: “A benefit to properties in the area and in the surrounding community or benefit to the public in general resulting from the improvement, activity, or service to be provided by the assessment levied.” “Special Benefit” as defined by the California State Constitution means a distinct benefit over and above general benefits conferred on real property located in the DOCBD or to the public at large.

Formula: There is one benefit zone in the DOCBD. (A map showing the DOCBD boundaries is shown in Chapter 2 of this Plan). Year 1 property assessment rates per parcel are as follows:
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5 YEAR 1 –Assessment Rates
Benefit Zone Annual Building Square
Footage Cost
Annual
Lot Size Cost
Annual Linear
Frontage Cost
All parcels $0.17 $0.065 $ 6.50
Residential Condos $0.20 0 0
Assessments for the County of San Bernardino Property Tax Year fiscal beginning July 1, 2025 and ending June 30, 2034, are proposed to be collected at the same time and in the same manner as ad valorem taxes paid to the County of San Bernardino (Operation Years 2025-2034). The District assessments shall appear as a separate line item on the property tax bills issued by the San Bernardino County Assessor. The City of Ontario is authorized to collect any assessments not placed on the County tax rolls, or to place assessments, unpaid delinquent assessments, or penalties on the County tax rolls as appropriate to implement this Management District Plan.

Cap: Assessment increases are capped at a maximum of 5% per year, subject to approval by the DOCBD Property Owner Association Board of Directors, Owners Association.

Renewal:

The DOCBD renewal is a two-step process. First, petitions signed by DOCBD property owners representing at least 50% of the total assessment to be levied must be secured. Second, property owners will be sent a ballot to vote on forming the CBD and levying the assessment. Returned ballots in support of the CBD Renewed must outweigh those in opposition based on the amount of assessment to be levied. Ballots are weighted based on the total assessment attributable to each parcel.

Duration
As allowed by State PBID Law, the renewed DOCBD will have a ten (10) year operational term from January 1, 2025 to December 31, 2034. The proposed renewed District operation is expected to begin services on January 1, 2025. If the District is not renewed, services will end on December 31, 2034.
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6 II. DOCBD RENEWAL BOUNDARIES
General
The renewed Downtown Ontario CBD is located along Euclid Avenue (SR83) in Downtown Ontario, just south of Interstate 10 and north of Highway 60. The DOCBD is a grid based commcerial district with its eastern boundary proposed as predominantly on North Lemon Avenue and its west boundary proposed as predominantly along S. Palm Avenue. The district boundaries run the underpass just south of Emporia Street northward to the south side of G Street.

Boundary Description: The Downtown Ontario CBD encompasses approximately 23 square blocks centered by Euclid Avenue.

Benefit Zones: The District consists of one benefit zone.

District Boundary Rationale
The Downtown Ontario CBD boundaries are comprised of the commercial core parcels where the main economic activity of Downtown Ontario is centered. The commercial parcels fronting Euclid Avenue are the historic heart of the commercial core of the city of Ontario. These parcels showcase an array of commercial retailers, restaurants, retailers, service stores, the vast Town Center block, churches and soon will be home to a full block of market rate housing and a full block of a new university. After years of little if any new development, the corridor is now experiencing a renaissance of new market rate housing development in the form of new mixed use, market rate housing. Its proximity to Interstate 10, Highway 60, the Ontario Airport and the Metrolink station in Upland makes it an ideal place to live in and conduct commerce in the region.

The new housing and excellent historic and contemporary housing surrounding Downtown is evolving into an emerging 21 st century mixed use community. New retail in the form of stores, restaurants and coffee shops are following the growth of high density residential on Euclid Avenue.

Northern Boundary
The northern boundary of the CBD is defined by the commercial parcels which are located just south of G Street from the east side of North Laurel Avenue on the west and the west side of North Lemon Avenue on the east. The District will only provide services to the individual assessed parcels within the boundaries; services will not be provided to parcels that are not assessed. No District programs and services will be provided north of the northern District boundary.

Western Boundary
The western boundary of the Downtown Ontario CBD is at the southeastern corner parcel at the intersection of West G Street and North Laurel Avenue (parcel 1048-356-01) and runs south along the eastern side of North Laurel to the intersection of West D Street and North Laurel Avenue.

The boundary then runs straight west along the south side of West D Street to the intersection of North Palm Avenue and West G Street. From there, the boundary runs south along the east side of North Palm Avenue from parcel 1048-561-13 southward to parcel 1049-056-06 at the 320
7 intersection of West Emporia Street and North Palm Avenue. The boundary then runs west along the south side of West Emporia Street to include the western most parcel 1049-059-07.

The District will only provide services to the individual assessed parcels within the boundaries; services will not be provided to parcels that are not assessed. No District programs and services will be provided west of the western District boundary.

Southern Boundary
The southern boundary of the CBD begins at parcel 1049-059-07 on West Emporia Street and runs on the south side of all the parcels on West Emporia Street to the parcel at the west side of the intersection of West Emporia Street and North Plum Street, ending at parcel 1049-064-14.

Eastern Boundary
The eastern boundary of the CBD begins at the parcel at the west side of the intersection of West Emporia Street and North Plum Street, at parcel 1049-064-14 and runs northward along the west side of North Plum Avenue to the parcel at the southwestern corner of the intersection of East Holt Blvd and North Plum Avenue, parcel 1049-063-05. The boundary then runs westward for one block on the south side of East Holt Blvd. to the southeastern parcel of the intersection of South Lemon Avenue and East Holt Blvd., parcel 1049-063-01, and then runs northward along the western side of North Lemon Avenue up to the parcel at the southwestern corner of the intersection of East G Street and North Lemon Avenue, ending at parcel 1048-361-05.

Summation
A list of all parcels included in the proposed DOCBD are shown as Appendix 1, attached to this report identified by their respective San Bernardino County assessor parcel numbers. The boundary of the proposed DOCBD is shown on the map of the DOCBD is to be found on page 10 of this report.

All identified assessed parcels within the above-described boundaries shall be assessed to fund supplemental programs, services and improvements that provide a special benefit to assessed parcels, as outlined in this Management District Plan. All DOCBD funded services, programs and improvements shall be provided within the above described boundaries and no services shall be provided outside of the DOCBD. Each assessed parcel within the DOCBD will specially benefit from the District funded programs and services (i.e. Civil Sidewalks, District Identity and Place Making, Administration and Contingency).
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8 These services, programs and improvements are intended to improve commerce, employment, rents and occupancy rates and investment viability of individually assessed parcels and businesses within the DOCBD. The DOCBD confers special benefits on each individually assessed parcel by reducing crime, improving aesthetics and marketing goods and services available from individually assessed parcels and the businesses and residential rental units within the District, all considered supplemental in a competitive properly managed Downtown district.

All District funded services programs and improvements are supplemental, above normal base level services provided by the City of Ontario and are only provided for the special benefit of assessed parcels within the boundaries of the proposed renewed DOCBD.

The District includes 204 parcels of which all are identified as assessable which are listed in the Assessment Roll included as Appendix 1.
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9 323
10 III. P ROPOSED TEN-YEAR CBD RENEWAL WORK PLAN AND BUDGET Overview
The Programs and activities to be funded by the DOCBD will include Civil Sidewalks, District Identity and Place Making, Administration services, and Contingency. The property uses within the boundaries of the District that will receive special benefits from District funded programs, services and improvements are currently a unique mix of retail, office, grocery, restaurant, ecumenical, banking, public space, mixed use housing developments, service and other commercial uses. District funded activities are primarily designed to provide special benefits as described below to identify assessed parcels and array of land uses within the boundaries of the District.

These benefits are distinct to each identified assessed parcel within the DOCBD and are not provided to non-assessed parcels outside of the District. These programs, services and improvements will only be provided to each individual assessed parcel within the District boundaries and, in turn, confer proportionate "special benefits” to each assessed parcel.

In the case of the DOCBD, the very nature of the purpose of this District is to fund supplemental programs, services and improvements to assessed parcels within the District boundaries above and beyond what is being currently funded either via normal tax supported methods or other funding sources. The City of Ontario does not provide these supplemental programs and services.

All benefits derived from the assessments to be levied on assessed parcels within the District are for services, programs and improvements directly benefiting each individual assessed parcel within the District. No District funded services, activities or programs will be provided outside of the District boundaries.

The projected program special benefit cost allocation of the District assessment revenues for the 10-year District term assuming a 5% maximum annual assessment rate increase is shown in the Table on page 14 of this Plan.

Renewal Work Plan Details
The special benefit services to be provided by the DOCBD are all designed to contribute to the cohesive commercial fabric and to ensure economic success and vitality of the District. The assessed parcels in the CBD will specially benefit from the District programs in the form of increasing commerce and improving economic success and vitality through meeting the CBD goals: to improve sanitation, beautification, landscaping, and to attract new and retain existing businesses and services, and ultimately to increase commerce and improve the economic viability of each individual assessed parcel. The following programs, services and improvements are proposed by the DOCBD to specially benefit each individually assessed parcel within the District boundaries. DOCBD services, programs and improvements will not be provided to parcels outside the District boundary.
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11 Year 1 – PROPOSED RENEWAL BUDGET (ASSESSMENT REVENUES/SPECIAL BENEFIT COSTS) The proposed “bundles” of special benefit services are listed below.

CIVIL SIDEWALKS:

Examples of this category of special benefit services and costs may include, but is not limited to:
 Regular sidewalk and gutter sweeping
 Regular sidewalk steam cleaning
 Beautification of the district
 Enhanced trash emptying (over and above city services)  Timely graffiti removal, within 24 hours as necessary  Tree and vegetation maintenance (over and above city services)  Maintenance of existing and new public spaces supplemental to what is current being provided by the City of Ontario
 Installation of and maintenance of hanging plants, planting flowers throughout the district
 Private security or case workers to respond to homeless issues, aggressive panhandling and mentally ill people behaving poorly in the public rights of way, including possible hiring of Ontario PD Bike patrols and/or a camera system
DISTRICT IDENTITY AND PLACEMAKING:

Examples of this category of special benefit services and costs may include, but is not limited to:
 Web site development and updating
 Management and coordination of special events
 Social media
 Public relations firm
 Holiday and seasonal decorations
 Branding of the Downtown Ontario CBD properties so a positive image is promoted to the public
 Banner programs
 Public art displays
 Logo development
 Public space design and improvements

ADMINISTRATION/PROGRAM MANAGEMENT
Examples of this category of special benefit services and costs may include, but is not limited to:
 Staff and administrative costs
 Directors and Officers Insurance, General Liability and other insurance coverages
 Office related expenses
 Rent
 Financial reporting and accounting, and legal services 325
12 CONTINGENCY/CITY AND COUNTY FEES/RESERVE
As with other plans in similar CBDs, this management plan sets aside a 4% contingency/reserve which provides for costs related to operating the district. Those costs may include, but not be limited to:
 City and/or County fees associated with their oversight and implementation of the District,
 the implementation of the Management District Plan and the Engineer’s Report.  City fees to collect and process the assessments, delinquencies and non-payments. A percentage of the budget is held in reserve to offset delinquent and/or slow payment from both public and private properties. This component also funds the expenses charged by the County of San Bernardino for collection and distribution of DOCBD revenue.  Other unanticipated costs related to the compliance of the Management District Plan and Engineer’s report.
 Funding for renewal of the District;
METHOD OF FINANCING:

The financing of the renewed Downtown Ontario CBD is based upon the levy of special assessments upon real property that receive special benefits from the improvements and activities. There will be five factors used in the determination of proportional benefit to the parcels in the CBD. Those four factors are:
 Linear frontage
 Lot size or the footprint of the parcel
 Building square footage (excluding parking structures built within the building that predominantly serve the tenants of the building and are not open to the public) and  New Residential condominiums built within the District boundaries

PROGRAM & ACTIVITY BUDGET
Each identified assessed parcel within the renewed DOCBD will be assessed the full amount of the proportionate special benefit conferred upon it based on the level of District funded services provided, except those tax-exempt owner-occupied parcels which shall only for the direct special benefits they will be receiving along the frontage of their parcels facing streets within the DOCBD. The projected District program special benefit (assessment) cost allocation budget for Year 1 is shown in the following Table:
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13 Year 1 – PROPOSED RENEWAL BUDGET (ASSESSMENT REVENUES) Category of Special Benefit Services
2025
Approximate
Annual Amount
Approximate
Percentage of total
budget
Civil Sidewalks $ 290,000 60%
District Identity/Placemaking $ 96,000 20%
Administration $ 79,000 16%
Contingency $ 21,776 4%
Total $486,776 100%
To carry out the District programs outlined in the previous section, a Year 1 assessment budget of $484,314.00 is projected. Since the District is planned for a 10-year term, projected program costs for future years (Years 2-10) are set at the inception of the District. While future inflationary, new development assessments and other program cost increases are unknown at this point, a built-in maximum increase of 5% per annum, commensurate to special benefits received by each assessed parcel, is incorporated into the projected program costs and assessment rates for the 10-year District term. The District shall adhere to the budget and Management District Plan.

While some variation is permissible to account for unexpected circumstances, the funding allocated to each funding category expressed as a percentage of the total budget, shall not vary by more than 10% of total budget from each year’s percentage in the Management District Plan.

Any proposed variation that exceeds 10% of total budget shall be subject to review and approval of the City Manager’s office. Any surplus or unspent funds, per category, may accumulate year to year over the life of the CBD. A 10-year projected DOCBD budget is shown in the following Table:
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14 YEAR 1-10 PROJECTED DISTRICT ASSESSMENT BUDGET SUMMARY (Special Benefit Costs) (Assumes 5% max rate increase per year)
Year Civil Sidewalks
District Identity and
Placemaking Administration Contingency Total
% 60% 20% 16% 4% 100%
1 $ 290,000.00 $ 96,000.00 $ 79,000.00 $ 21,776.00 $ 486,776.00 2 $ 304,500.00 $ 100,800.00 $ 82,950.00 $ 22,864.80 $ 511,114.80 3 $ 319,725.00 $ 105,840.00 $ 87,097.50 $ 24,008.04 $ 536,670.54 4 $ 335,711.25 $ 111,132.00 $ 91,452.38 $ 25,208.44 $ 563,504.07 5 $ 352,496.81 $ 116,688.60 $ 96,024.99 $ 26,468.86 $ 591,679.27 6 $ 370,121.65 $ 122,523.03 $ 100,826.24 $ 27,792.31 $ 621,263.23 7 $ 388,627.74 $ 128,649.18 $ 105,867.56 $ 29,181.92 $ 652,326.40 8 $ 408,059.12 $ 135,081.64 $ 111,160.93 $ 30,641.02 $ 684,942.72 9 $ 428,462.08 $ 141,835.72 $ 116,718.98 $ 32,173.07 $ 719,189.85 10 $ 449,885.18 $ 148,927.51 $ 122,554.93 $ 33,781.72 $ 755,149.34 The Assessment Engineer (see attached Engineer’s Report) has found that the general benefits (i.e. general benefits to assessed parcels within the District, the general public and surrounding parcels outside the DOCBD) of the proposed programs, services and improvements (i.e. Civil Sidewalks, District Identity and Placemaking, Administration services, and Contingency) represent 2% of the total benefits generated and, in turn, 2% ($ 9,934) of the total adjusted costs of the DOCBD funded improvements, activities and services provided.

Total Year 1 adjusted costs are estimated at $ 496,710. General benefits are factored at 2% of the total adjusted costs ( see Finding 2 in the attached Engineer’s Report) with special benefits set at 98%. Article XIIID Section 4(b) of the California Constitution limits the levy of property assessments to costs attributed to special benefits only. The 2% general benefit cost is computed to be $ 9,934 with a resultant 98% special benefit limit computed at $ 486,776. Based on current property data and land uses, this is the maximum amount of Year 1 revenue that can be derived from property assessments from the subject District.

All program costs associated with general benefits will be derived from sources other than District assessments. Sample “other” revenue sources are shown in the following Table:
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15 Special and General Benefit Revenue Sources
Revenue Source Revenue % of Total
District Assessments $ 486,776 98%
Grants, donations, sponsors, program income, etc. $9,934 2% Total $ 496,710 100.0%
The DOCBD assessments may increase for each individual parcel each year during the 10-year effective operating period, but not to exceed 5% per year, commensurate to special benefits received by each assessed parcel, and must be approved by the Owners’ Association Board of Directors, included in the Annual Planning Report and adopted by the Ontario City Council.

Any accrued interest and delinquent payments will be expended within the budgeted categories.

The Owners’ Association Board of the Directors (Property Owner’s Association of the DOCBD) shall determine the percentage increase to the annual assessment and the methodology employed to determine the amount of the increase. The Owners’ Association Executive Director or staff shall communicate the annual increase to the City each year in which the District operates at a time determined in the Administration Contract held between the Owners’ Association and the City of Ontario.

No bonds are to be issued in conjunction with the proposed renewed District.

Pursuant to Section 36671 of the Streets and Highways Code, any funds remaining after the 5th year of operation will be rolled over into the renewed budget or returned to stakeholders. District assessment funds may be used to pay for costs related to the following District renewed term. If the District is not renewed or terminated for any reason, unexpended funds will be returned to the property owners in the same proportion in which they were collected.

Manner of Collection
Assessments for the County of San Bernardino Property Tax Year fiscal beginning July 1, 2024 and ending June 30, 2034, are proposed to be collected at the same time and in the same manner as ad valorem taxes paid to the County of San Bernardino (Operation Years 2025-2034). The District assessments shall appear as a separate line item on the property tax bills issued by the San Bernardino County Assessor. The City of Ontario is authorized to collect any assessments not placed on the County tax rolls, or to place assessments, unpaid delinquent assessments, or penalties on the County tax rolls as appropriate to implement this Management District Plan. 329
16 IV PROPOSED RENEWAL ASSESSMENT FORMULA
The DOCBD programs and services described in this Management District Plan will be funded through benefit assessments against real property in DOCBD and non-assessment revenues to fund the costs associated with general benefits conferred on assessed parcels within the District, the public at large and surrounding parcels outside of the DOCBD boundaries. The assessment formula has been developed to ensure that no parcel will be assessed an amount that exceeds the cost of the proportional special benefit that parcel derives from the programs, services and improvements to be funded by the proposed benefit assessments. The assessment rates are based on the anticipated benefit to be derived by each individual parcel within the boundary of the DOCBD.

Based on the specific needs and corresponding nature of the program activities to be funded by the proposed renewed DOCBD (i.e. Civil Sidewalks, District Identity and Placemaking, Administration services, and contingency), the assessment factors on which to base assessment rates relate directly to the proportionate amount of land area and street frontage within district boundaries.

The “Basic Benefit Units” will be expressed as a combined function of land square footage (Benefit Unit “A”), street frontage (Benefit Unit “B”) and building square footage, (Benefit unit “C”). Based on the shape of the proposed renewed DOCBD, as well as the nature of the District program elements, it is determined that all identified assessed properties will gain a direct and proportionate degree of special benefit based on the respective amount of land area, street frontage and building square footage.

For the array of land uses within the District, the interactive application of land area, street frontage and building square footage quantities are a proven method of fairly and equitably spreading special benefit costs to these beneficiaries of District funded services, programs and improvements. Each of these factors directly relates to the degree of special benefit each assessed parcel will receive from District funded activities.

Land area is a direct measure of the current and future development capacity of each parcel and its corresponding impact or draw on District funded activities. The targeted weight of this factor, land area, should generate approximately 27% of the total first year District revenue.

Linear Frontage is a direct measure of the static utilization of each parcel and its corresponding impact or draw on District funded activities, many of which are linear in nature (i.e. Landscaping, Sanitation and Beautification). The targeted weight of this factor, street frontage, should generate approximately 36% of the total District revenue.
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17 Building Square Footage is a direct measure of the current and future improvements to the building square footage of each parcel and its corresponding impact or draw on District funded activities. The targeted weight of this factor, building square footage, should generate approximately 37% of the total District revenue.

Building square footage that is allocated to parking solely for tenants and is NOT available to the public at any time, at market rates, shall have that portion of the building square footage exempted from the individual parcel’s gross building square footage. This reduction or exemption only applies to the building square footage of structured parking that is not available to public access and use. The individual parcel owner has the responsibility to inform the Management Corporation (Owners Association) if such deductions are applicable since County records to not reveal this information via County tax records.

Enhanced Residential Condominium Unit Improvements: (currently don’t exist within the boundaries of the District)
Future residential condominium development within the boundaries of the District will be assessed separately due to their unique characteristics and special benefit needs. Residential condominiums or town homes will have the following special benefit services conferred on the frontage their parcels. These services may include, but will not be limited to:
 Installation, stocking and upkeep of pet waste stations on the frontages adjacent to high concentrations of residential condominium individually assessed parcels;  Enhancement and beautification of sidewalks on the frontages adjacent to high concentrations of residential individually assessed parcels;  Installation of hanging plants and enhanced upkeep of the sidewalks surrounding frontages adjacent to residential condominiums;
 Other services requested by residents that confer special benefits to the areas directly adjacent to parcels with high concentrations of residential condominiums;  Proportional share of the Administrative and Contingency costs to cover the oversight of enhanced beautification special benefit services.

Considering all identified specially benefiting parcels within the District and their respective assessable benefit units, the rates, cumulative quantities and assessment revenues by factor and zone are shown in the following tables:

Data generated from County records and validated by request of owner verification by mail:

Land Area/Lot size: 2,031,094 feet of assessable land area square footage Linear Frontage: 27,356 linear feet of assessable linear frontage Gross Building Square footage 1,040,518 feet of assessable building square footage Residential Condominiums 0
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18 Note: Tax-exempt owner-occupied parcels will only be assessed for the lot square footage and linear frontage of the individual parcels fronting on any street within the boundaries of the DOCBD since civil sidewalks and administration are the only special benefit services that will be provided to those individual parcels according to this Management Plan. The lot square footage and linear frontage will be calculated along the same property lines as adjacent parcels.

Year 1 – Projected DOCBD Assessment Revenue

LAND AREA

ASSMT REVENUE
LINEAR

FRONTAGE
ASSMT

REVENUE

BUILDING SQUARE
FOOTAGE ASSMT.

REVENUE

RESIDENTIAL

CONDOMINIUM
UNIT

REVENUE

SUBTOTAL

ASSMT REVENUE
Revenue $132,074 $ 177,814 $ 176,888 0 $ 486,776
Percentage
of total 27% 36.5% 36.5% 0% 100%
The number of Benefit Units for each identified benefiting parcel within the proposed DOCBD was computed from data extracted from County Assessor records and maps as well as property verification forms mailed out to each parcel owner in the proposed District. These data sources delineate current land uses, property areas and dimensions of record for each tax parcel.

The assessment formula for the proposed renewed DOCBD is as follows:

Assessments = Land Area (Unit A) Sq Ft x Unit A Rate, plus Street Frontage (Unit B) Lin Ft x Unit B Rate, plus
Building Square footage (Unit C) Sq Ft x Unit C rate
YEAR 1 – Assessment Rates
Land Area annual
assessment
Unit A
Linear Frontage
annual assessment
Unit B
Building square forage
annual assessment
Unit C
Residential
Condominiums
$ 0.065 per square foot $ 6.50 per linear foot $0.17 per square foot $0.20 per square foot for building square footage
Changes to Frontage, Building or Lot Parcel Size
Any changes in frontage, building and lot parcel size as a result of all three land adjustments including but not limited to lot splits, consolidations, subdivisions, street dedications, right of way setbacks shall have their assessment adjusted upon final City approval of such parcel adjustments.
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19 Other Future Development
Other than future maximum rates with the frontage, building or parcel size assessment methodology delineated in this report, per State Law (Government Code Section 53750), future assessments may increase for any given parcel if such an increase is attributable to events other than an increased rate or revised methodology, such as a change in the density, intensity, or nature of the use of land. Any change in assessment formula methodology or rates other than as stipulated in this Plan would require a new Proposition 218 ballot procedure in order to approve any such changes.

Future Residential Condominium Unit Parcels Defined:

Future residential condominium units building square footage is defined as the livable building square footage within the walls of the condominium residential unit parcel. They are included in a special category to designate their unique special benefits relative to the other commercial parcels within the Downtown Ontario CBD. Unlike the other commercial parcels in the district, including commercially operated apartment buildings, residential condominium parcels are assessed for building square footage only, and are not assessed for linear frontage and lot square footage.

Future residential condominium individually assessed parcels are assessed as a separate category. These future residential condominium individual parcels will be assessed for their building square footage only at the rate of $0.20 per square foot per year, commencing the first year of their completion if the assessment rate has not been adjusted annually as allowed in this plan. The rationale for assessing future residential condominiums only for the building square footage rate is provided below and its cost will be based upon the year that the residential condominium may be completed, (please see chart on page 23).

Residential condominium parcels are assessed differently than multi-unit, for-rent apartment buildings, due to the frequency of special benefit services required by each parcel as described below. The multi-unit apartment buildings are commercial properties in which the tenant and landlord have an economic relationship as opposed to residential condominium buildings where individual property owners own separate “air space parcels” on a single floor. Future residential apartment buildings can be bought or sold just as like commercial buildings whereas residential condominium units are separately owned and must be individually bought and sold.

Distinctions between residential apartment buildings with tenants and residential condominium building with individual parcel owners are as follows:

1. The Davis Sterling Act establishes rules and regulations for residential condominium owners based upon “separate interests” (i.e. ownership rights), as opposed to renters who only have a possessory interest.
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20 2. Generally, residential condominium unit owners demonstrate greater care for their property and concerns about quality of life issues due to their investment in real estate.

3. Residential owners have the right to vote in a Proposition 218 hearing, tenants do not have that right.

4. Residential condominium owners are required to contribute to legally renewed Homeowners Associations to oversee building maintenance, tenants are not.

5. Residential tenants may have their dwelling units sold or have their rent raised arbitrarily due the lack of ownership of their residential units.

The assessment methodology has been written to confer special benefits to future residential condominium individual assessed parcels since future residential condominium owners have unique investment backed expectations about the care and maintenance of the building and its surroundings compared to the interest of residential tenants who have a possessory not an ownership interest. The future residential condominiums’ special assessment methodology ensures that a fund will be renewed to maintain high levels of special benefit services that apply directly and proportional to the blocks that demand virtually seven days per week, 365 days per year special benefits.

DOCBD – 10-year Maximum Assessment Rates
(Includes a 5%/Yr. Maximum Increase)
Year
Lot Square Foot
Assessment
Rate
Linear Frontage
Assessment Rate
Building Square
Footage Assessment
Rate
Residential
Condominium
(only assessed for
building sq. ft.)
1 $ 0.0650 $ 6.50 $ 0.1700 $ 0.20000 2 $ 0.0683 $ 6.83 $ 0.1785 $ 0.21000 3 $ 0.0717 $ 7.17 $ 0.1874 $ 0.22050 4 $ 0.0752 $ 7.52 $ 0.1968 $ 0.23153 5 $ 0.0790 $ 7.90 $ 0.2066 $ 0.24310 6 $ 0.0830 $ 8.30 $ 0.2170 $ 0.25526 7 $ 0.0871 $ 8.71 $ 0.2278 $ 0.26802 8 $ 0.0915 $ 9.15 $ 0.2392 $ 0.28142 9 $ 0.0960 $ 9.60 $ 0.2512 $ 0.29549 334
21 10 $ 0.1008 $ 10.08 $ 0.2637 $ 0.31027 SAMPLE DOCBD FIRST YEAR ANNUAL ASSESSMENT CALCULATION:

A 5,000 sq. ft. lot with 50 linear feet in Downtown Ontario in street frontage and a 2,500 square foot building
Land/Lot size square footage: 5,000 x $.065 cents per square foot = $325.00 plus Liner Frontage: 50 linear feet x $6.50 per linear foot = $325.00 plus Building Square Footage 2,500 x $0.17 cents per square foot = $42.50 TOTAL YEAR 1 ASSESSMENT: $ 692.50
Cost Per Month: $ 57.70
Cost Per Day: $ 1.90
A residential condominium, once built, would pay as follows: (based upon the chart above if no annual increases have been applied to the overall budget) Building Square footage: 1,000 square feet x $0.20 per sq. ft. =$200.00 The complete Year 1 – assessment roll of all parcels to be assessed by this CBD is included in this Plan as Appendix I.

V. PUBLICLY OWNED PARCELS
The State Constitution - Article 13D (Proposition 218) states that “parcels within a District that are owned or used by any agency, the State of California or the United States shall not be exempt from assessment unless the agency can demonstrate by clear and convincing evidence that those publicly-owned parcels in fact receive no special benefit.” There are 75 publicly owned parcels within the renewed District, all of which are identified as assessable and for which special benefit services will be provided. 55 identified assessed parcels are owned by the City of Ontario, 19 are owned by the City of Ontario Housing Authority, one is owned by the US Postal Service and one is owned by the San Bernardino County Housing 335
22 Authority. All publicly owned parcels will be assessed as all other commercial parcels are assessed in accordance to this plan, that is on their parcel lot size, linear frontage and building square footage.

Each of these publicly owned parcels will directly receive special benefit from improved Civil Sidewalks, District Identity and Placemaking, Administration services, and contingency.

These 75 identified assessed publicly owned parcels/facilities will specially benefit from DOCBD funded programs and services from cleaner and safer facility entrances and street frontages as well as serve for a better, improved district for the hundreds of City employees and residents in the City, Housing Authority and Postal Service owned parcels.

In the opinion of the Assessment Engineer, there is no evidence that these 75 publicly owned parcels will not proportionately specially benefit from District services, programs and improvements; therefore, each publicly owned parcel will be assessed at the rates with assessments to be based on the lot square footage area, street linear frontage and building square footage of each parcel. The Table below lists all publicly owned parcels within the proposed renewed DOCBD and their Year 1 assessment amounts:

City of Ontario, Ontario Housing Authority, San Bernardino County Housing Authority and US Postal Service Publicly owned parcels
APN Legal Owner Site Address Annual
Assessment
1048-354-12-0000 CITY OF ONTARIO D ST $ 3,743.22 1048-354-13-0000 CITY OF ONTARIO LAUREL AVE $ 882.70 1048-355-02-0000 CITY OF ONTARIO $ 862.49 1048-355-11-0000 CITY OF ONTARIO $ 1,041.11 1048-356-08-0000 CITY OF ONTARIO 603 N EUCLID AVE $ 784.30 1048-356-11-0000 CITY OF ONTARIO F ST $ 994.44 1048-363-02-0000 CITY OF ONTARIO PARKING LOT $ 5,147.09 1048-363-03-0000 CITY OF ONTARIO PARKING LOT $ 2,204.28 1048-363-04-0000 CITY OF ONTARIO 404 N EUCLID AVE $ 3,772.70 1048-363-05-0000 CITY OF ONTARIO 414 N EUCLID AVE $ 9,198.98 1048-551-10-0000 CITY OF ONTARIO 116 E D ST $ 5,824.13 1048-552-13-0000 CITY OF ONTARIO 126 E C ST $ 5,796.64 1048-552-14-0000 CITY OF ONTARIO 124 E C ST $ 1,871.74 1048-552-18-0000 CITY OF ONTARIO N EUCLID $ 142.29 1048-553-02-0000 CITY OF ONTARIO 118 E B ST $ 1,620.74 1048-553-03-0000 CITY OF ONTARIO B ST $ 864.24 1048-553-04-0000 CITY OF ONTARIO 127 N LEMON AVE $ 2,014.74 1048-553-16-0000 CITY OF ONTARIO 126 N EUCLID AVE $ 1,329.51 1048-553-17-0000 CITY OF ONTARIO 128 N EUCLID AVE $ 3,912.85 1048-562-01-0000 CITY OF ONTARIO 215 W C ST $ 9,035.13 1048-563-06-0000 CITY OF ONTARIO HOLT BLVD $ 2,077.73 1048-564-03-0000 CITY OF ONTARIO 139 N EUCLID AVE $ 4,507.80 336
23 1048-564-05-0000 CITY OF ONTARIO 125 N EUCLID AVE $ 952.50 1048-564-06-0000 CITY OF ONTARIO 121 N EUCLID AVE $ 904.28 1048-564-13-0000 CITY OF ONTARIO LAUREL AVE $ 786.44 1048-564-14-0000 CITY OF ONTARIO LAUREL AVE $ 1,235.78 1048-565-01-0000 CITY OF ONTARIO 127 W C ST $ 3,411.72 1048-565-02-0000 CITY OF ONTARIO 115 W C ST $ 688.50 1048-565-03-0000 CITY OF ONTARIO 245 N EUCLID AVE $ 7,936.01 1048-565-09-0000 CITY OF ONTARIO 207 N EUCLID AVE $ 1,406.70 1048-565-13-0000 CITY OF ONTARIO LAUREL AVE $ 1,029.34 1048-565-14-0000 CITY OF ONTARIO LAUREL AVE $ 549.12 1048-566-01-0000 CITY OF ONTARIO 123 W D ST $ 1,274.00 1048-566-02-0000 CITY OF ONTARIO 123 W D ST $ 1,903.11 1048-566-03-0000 CITY OF ONTARIO $ 864.24 1048-566-08-0000 CITY OF ONTARIO 301 W C ST $ 156.00 1048-566-09-0000 CITY OF ONTARIO W C ST $ 1,603.03 1048-566-10-0000 CITY OF ONTARIO LAUREL AVE $ 2,014.74 1048-566-11-0000 CITY OF ONTARIO 324 N LAUREL AVE $ 1,116.10 1049-056-01-0000 CITY OF ONTARIO 221 W TRANSIT ST $ 2,640.63 1049-056-02-0000 CITY OF ONTARIO 211 W TRANSIT ST $ 628.68 1049-056-03-0000 CITY OF ONTARIO W TRANSIT ST $ 628.68 1049-056-04-0000 CITY OF ONTARIO 200 S LAUREL AVE $ 1,322.10 1049-056-05-0000 CITY OF ONTARIO 208 W EMPORIA ST $ 5,164.63 1049-056-06-0000 CITY OF ONTARIO 228 W EMPORIA ST $ 2,614.63 1049-057-06-0000 CITY OF ONTARIO W TRANSIT ST $ 1,378.00 1049-057-07-0000 CITY OF ONTARIO 206 W TRANSIT ST $ 567.00 1049-058-02-0000 CITY OF ONTARIO W TRANSIT ST $ 772.01 1049-059-14-0000 CITY OF ONTARIO EMPORIA ST $ 5,193.70 1049-062-01-0000 CITY OF ONTARIO 225 S EUCLID AVE $ 7,333.16 1049-062-02-0000 CITY OF ONTARIO TRANSIT ST $ 5,205.20 1049-063-02-0000 CITY OF ONTARIO 214 E HOLT BLVD $ 3,449.12 1049-064-12-0000 CITY OF ONTARIO $ 524.16 1049-064-13-0000 CITY OF ONTARIO 217 S LEMON AVE $ 2,782.42 1049-064-14-0000 CITY OF ONTARIO 204 E TRANSIT ST $ 8,225.17 TOTAL $ 143,889.68
1048-551-11-0000 ONTARIO HOUSING AUTHORITY 312 N EUCLID AVE $ 4,211.09 1048-551-12-0000 ONTARIO HOUSING AUTHORITY 334 N EUCLID AVE $ 3,246.10 1048-551-13-0000 ONTARIO HOUSING AUTHORITY 127 E C ST $ 1,756.95 1048-552-15-0000 ONTARIO HOUSING AUTHORITY C ST $ 223.54 1048-552-17-0000 ONTARIO HOUSING AUTHORITY 240 N EUCLID AVE $ 3,287.55 1048-552-24-0000 ONTARIO HOUSING AUTHORITY $ 2,849.08 1048-553-01-0000 ONTARIO HOUSING AUTHORITY W B ST $ 1,685.71 1048-553-05-0000 ONTARIO HOUSING AUTHORITY 115 N LEMON AVE $ 634.40 1048-553-06-0000 ONTARIO HOUSING AUTHORITY 127 E HOLT BLVD $ 1,268.15 1048-553-07-0000 ONTARIO HOUSING AUTHORITY 123 E HOLT BLVD $ 486.92 1048-553-08-0000 ONTARIO HOUSING AUTHORITY 121 E HOLT BLVD $ 782.02 1048-553-09-0000 ONTARIO HOUSING AUTHORITY E HOLT BLVD $ 413.14 1048-553-10-0000 ONTARIO HOUSING AUTHORITY E HOLT BLVD $ 1,112.80 1048-553-11-0000 ONTARIO HOUSING AUTHORITY N EUCLID AVE $ 455.39 337
24 1048-553-12-0000 ONTARIO HOUSING AUTHORITY 110 N EUCLID AVE $ 455.39 1048-553-13-0000 ONTARIO HOUSING AUTHORITY 112 N EUCLID AVE $ 2,610.78 1048-553-14-0000 ONTARIO HOUSING AUTHORITY 118 N EUCLID AVE $ 485.42 1048-553-15-0000 ONTARIO HOUSING AUTHORITY 122 N EUCLID AVE $ 1,110.88 TOTAL $ 27,075.29
1049-058-03-0000 SAN BERNARDINO COUNTY HOUSING
AUTH
200 S EUCLID AVE
$ 5,450.32
1049-057-01-0000 UNITED STATES OF AMERICA 123 E HOLT BLVD $ 4,266.08 VI. DOCBD DISTRICT GOVERNANCE
The governance or management of a CBD typically requires an “Owners’ Association” to carry out the CBD services and activities. State CBD Law (36600 Streets & Highways Code) also requires that the Owner’s Association carry out specific additional functions. This includes preparation of an Annual Report to the City Council on the CBD activities for the past fiscal year and those proposed for the next fiscal year. The Owner’s Association may also recommend to the City Council from time to time, changes to the CBD boundaries, assessment formula or CBD programs and activities, all subject to public notification and, in some cases petition/balloting requirements.

Meetings of the Owners’ Association and its standing Committees shall be subject to the State of California “Brown Act” open meeting law. Since the establishment of the DOCBD, by a vote of the affected property owners in 2019, the Owners Association has now incorporated into a public benefit, non-profit organization (501c3), named the Downtown Ontario Improvement Association.

VII. P ROPOSED RULES AND REGULATION APPLIED TO THE DISTRICT There are no specific rules or regulations applied to this CBD or its Owners’ Association.

VIII. OTHER ITEMS
No bonds will be issued for any DOCBD projects in conjunction with this formation. 338
25 IX. I MPLEMENTATION TIMETABLE
Task Timeline
The DOCBD Renewal Committee
approves the rough draft
DOCBD Renewal Management
Plan
The Renewal Committee approves the preliminary plan in July including boundaries, budget, the percentage allocation of each special service category, management and term.

Management District Plan
(MDP) submitted to City and
Assessment Engineer
The state constitution requires that the Management District Plan be certified as compliant with Proposition 218 by an Assessment Engineer. The Plan must also be approved by the City Attorney and City Manager. Estimated time for completion of this process is the middle of August.

Management District Plan is
approved by the City Attorney
and Assessment Engineer and
petition drive is launched
We anticipate the petition drive to be launched by the CBD Steering Committee in late August , with the target completion date by the beginning of September. 50% of the assessment amount paid by property owners must sign a petition endorsing the DOCBD Renewal Plan to initiate a mail balloting procedure of property owners
Resolution of Intent In mid-September, the City Council will receive a staff report and consider and adopt a “Resolution of Intent” to form the Downtown CBD. The requisite number of weighted petitions must be submitted to the City to trigger this process and allow the balloting to proceed. The City Council would then instruct the City Clerk to mail ballots to all affected property owners within the CBD boundaries. The ballots will be due by the public hearing date and will allow each property owner to vote yes or no on the mail ballot.

Public Hearing It is anticipated that the public hearing will be held the middle of November. Testimony will be given by property owners and the City Clerk will open and calculate the ballots. The DOCBD may be formed if the weighted majority of returned, signed ballots support the formation of the district.

Resolution of Formation Once the weighted return ballots are calculated and demonstrate support for the formation of the Downtown CBD, the City Council may then adopt a “Resolution of Formation” to create the CBD. The City Council may vote to levy the assessments on the benefitting parcels.

First assessments transferred The first assessment billings would be due with the December 2024 property tax bills. The first assessments will be transferred from the City to the Downtown Ontario Improvement Association after the first installments of assessments were collected by the County and the City in December 2024 or January 2025
339
26 APPENDIX 1
YR 1

ASSESSMENT ROLL
340
27 APN Annual Assessment
1048-354-01-0000 $1,960.27
1048-354-02-0000 $3,974.53
1048-354-03-0000 $3,264.84
1048-354-04-0000 $1,112.13
1048-354-05-0000 $328.50
1048-354-06-0000 $430.85
1048-354-07-0000 $1,844.41
1048-354-08-0000 $701.80
1048-354-09-0000 $1,112.13
1048-354-10-0000 $982.39
1048-354-11-0000 $4,234.00
1048-354-12-0000 $3,743.22
1048-354-13-0000 $882.70
1048-355-02-0000 $862.49
1048-355-03-0000 $2,342.43
1048-355-04-0000 $1,360.80
1048-355-05-0000 $738.79
1048-355-06-0000 $934.77
1048-355-07-0000 $1,830.21
1048-355-08-0000 $1,425.51
1048-355-11-0000 $1,041.11
1048-355-13-0000 $983.12
1048-355-15-0000 $4,493.66
1048-355-16-0000 $3,041.32
1048-356-01-0000 $4,154.59
1048-356-02-0000 $3,496.54
1048-356-03-0000 $1,278.58
1048-356-04-0000 $1,356.52
1048-356-05-0000 $3,018.78
1048-356-06-0000 $753.23
1048-356-07-0000 $455.39
1048-356-08-0000 $784.30
1048-356-09-0000 $1,251.60
1048-356-10-0000 $484.38
1048-356-11-0000 $994.44
1048-356-12-0000 $2,878.98
1048-356-13-0000 $1,116.22
1048-361-01-0000 $3,573.33
1048-361-02-0000 $811.27
1048-361-03-0000 $775.45
1048-361-04-0000 $2,048.49
1048-361-05-0000 $1,189.46
1048-361-06-0000 $919.88
1048-361-07-0000 $2,195.42
1048-361-08-0000 $2,755.52
1048-361-09-0000 $2,836.22
1048-361-10-0000 $1,805.49
1048-361-11-0000 $910.78
1048-361-12-0000 $913.58
1048-362-02-0000 $828.23
1048-362-03-0000 $4,454.64
1048-362-04-0000 $1,433.73
1048-362-05-0000 $1,783.34
1048-362-06-0000 $1,209.90
1048-362-07-0000 $2,835.72
1048-362-08-0000 $3,252.49
1048-362-09-0000 $2,195.83
1048-362-10-0000 $913.58
1048-363-01-0000 $1,390.84
1048-363-02-0000 $5,147.09
1048-363-03-0000 $2,204.28
1048-363-04-0000 $3,772.70
1048-363-05-0000 $9,198.98
1048-551-10-0000 $5,824.13
1048-551-11-0000 $4,211.09
1048-551-12-0000 $3,246.10
1048-551-13-0000 $1,756.95
1048-552-13-0000 $5,796.64
1048-552-14-0000 $1,871.74
1048-552-15-0000 $223.54
1048-552-17-0000 $3,287.55
1048-552-18-0000 $142.29
1048-552-22-0000 $3,438.35
1048-552-23-0000 $116.09
1048-552-24-0000 $2,849.08
1048-553-01-0000 $1,685.71
1048-553-02-0000 $1,620.74
1048-553-03-0000 $864.24
1048-553-04-0000 $2,014.74
1048-553-05-0000 $634.40
1048-553-06-0000 $1,268.15
1048-553-07-0000 $486.92
1048-553-08-0000 $782.02
1048-553-09-0000 $413.14
1048-553-10-0000 $1,112.80
1048-553-11-0000 $455.39
1048-553-12-0000 $455.39
1048-553-13-0000 $2,610.78
1048-553-14-0000 $485.42
1048-553-15-0000 $1,110.88
1048-553-16-0000 $1,329.51
1048-553-17-0000 $3,912.85
1048-561-07-0000 $2,595.63
1048-561-08-0000 $2,393.64
1048-561-09-0000 $1,104.65
1048-561-10-0000 $864.24
1048-561-11-0000 $1,547.80
1048-561-12-0000 $1,275.00
1048-561-13-0000 $26,251.98
341
28 1048-562-01-0000 $9,035.13
1048-562-02-0000 $2,725.00
1048-562-03-0000 $8,005.88
1048-562-06-0000 $866.87
1048-562-07-0000 $1,952.08
1048-563-01-0000 $1,736.72
1048-563-02-0000 $864.24
1048-563-03-0000 $2,878.87
1048-563-06-0000 $2,077.73
1048-563-07-0000 $1,678.02
1048-563-08-0000 $4,566.12
1048-563-09-0000 $851.24
1048-563-10-0000 $2,014.74
1048-563-11-0000 $595.80
1048-563-12-0000 $1,400.15
1048-563-13-0000 $4,259.19
1048-564-01-0000 $2,814.16
1048-564-02-0000 $3,707.32
1048-564-03-0000 $4,507.80
1048-564-04-0000 $1,505.63
1048-564-05-0000 $952.50
1048-564-06-0000 $904.28
1048-564-07-0000 $3,069.81
1048-564-08-0000 $846.02
1048-564-09-0000 $1,416.28
1048-564-10-0000 $2,234.65
1048-564-11-0000 $1,486.98
1048-564-12-0000 $3,441.42
1048-564-13-0000 $786.44
1048-564-14-0000 $1,235.78
1048-565-01-0000 $3,411.72
1048-565-02-0000 $688.50
1048-565-03-0000 $7,936.01
1048-565-04-0000 $663.84
1048-565-05-0000 $2,654.72
1048-565-06-0000 $2,238.82
1048-565-07-0000 $1,091.90
1048-565-08-0000 $1,038.80
1048-565-09-0000 $1,406.70
1048-565-10-0000 $3,079.24
1048-565-11-0000 $7,483.42
1048-565-12-0000 $1,545.72
1048-565-13-0000 $1,029.34
1048-565-14-0000 $549.12
1048-566-01-0000 $1,274.00
1048-566-02-0000 $1,903.11
1048-566-03-0000 $864.24
1048-566-04-0000 $4,036.16
1048-566-05-0000 $8,045.11
1048-566-06-0000 $1,749.88
1048-566-07-0000 $4,225.68
1048-566-08-0000 $156.00
1048-566-09-0000 $1,603.03
1048-566-10-0000 $2,014.74
1048-566-11-0000 $1,116.10
1049-055-01-0000 $3,378.04
1049-055-02-0000 $1,151.43
1049-055-03-0000 $1,349.84
1049-055-04-0000 $1,288.51
1049-055-05-0000 $1,338.18
1049-055-06-0000 $1,170.07
1049-055-07-0000 $577.40
1049-055-08-0000 $591.57
1049-055-09-0000 $4,541.39
1049-056-01-0000 $2,640.63
1049-056-02-0000 $628.68
1049-056-03-0000 $628.68
1049-056-04-0000 $1,322.10
1049-056-05-0000 $5,164.63
1049-056-06-0000 $2,614.63
1049-057-01-0000 $4,266.08
1049-057-02-0000 $1,404.58
1049-057-03-0000 $2,256.24
1049-057-04-0000 $1,565.90
1049-057-05-0000 $4,643.50
1049-057-06-0000 $1,378.00
1049-057-07-0000 $567.00
1049-058-01-0000 $3,463.82
1049-058-02-0000 $772.01
1049-058-03-0000 $5,450.32
1049-058-04-0000 $2,664.16
1049-058-05-0000 $2,859.89
1049-059-07-0000 $736.84
1049-059-08-0000 $1,504.80
1049-059-09-0000 $893.10
1049-059-14-0000 $5,193.70
1049-059-21-0000 $7,574.38
1049-061-01-0000 $13,936.41
1049-061-02-0000 $4,088.24
1049-061-03-0000 $603.72
1049-062-01-0000 $7,333.16
1049-062-02-0000 $5,205.20
1049-063-01-0000 $2,762.49
1049-063-02-0000 $3,449.12
1049-063-03-0000 $385.06
1049-063-04-0000 $750.62
1049-063-05-0000 $1,490.66
1049-063-06-0000 $1,791.56
1049-063-07-0000 $881.81
1049-063-08-0000 $1,210.37
342
29 1049-063-09-0000 $1,225.84
1049-063-10-0000 $1,281.84
1049-064-12-0000 $524.16
1049-064-13-0000 $2,782.42
1049-064-14-0000 $8,225.17
343
Ontario District 2020
Legend

District Parcel
Parcel
344
0 ATTACHMENT 1

DOWNTOWN ONTARIO

COMMUNITY BENEFIT DISTRICT

RENEWAL
ASSESSMENT ENGINEER’S
REPORT
Being Renewed for a 10 Year Term Pursuant to
California Streets and Highways Code Section 36600 et seq.

Property & Business Improvement District Act of 1994, as amended Prepared by
Edward V. Henning
California Registered Professional Engineer # 26549
Edward Henning & Associates
October 25, 2023
FINAL
345
DOWNTOWN ONTARIO CBD – ASSESSMENT ENGINEER’S REPORT
1 ASSESSMENT ENGINEER’S REPORT
To Whom It May Concern:

I hereby certify to the best of my professional knowledge and experience that each of the identified benefiting properties located within the proposed Downtown Ontario Community Benefit District ("DOCBD" or “District”) being renewed for a ten (10) year term will receive a special benefit over and above the benefits conferred on the public at large and that the amount of the proposed assessment is proportional to, and no greater than the benefits conferred on each respective property. I have personally prepared this Report and attest to all of its contents herein.

Introduction
This report serves as the “detailed engineer’s report” required by Section 4(b) of Article XIIID of the California Constitution to support the special benefit assessments to be levied on real properties within the proposed renewed DOCBD in the City of Ontario, California being renewed for a ten (10) year term.

The discussion and analysis contained within this Report constitutes the required “nexus” of rationale between assessment amounts levied and special benefits conferred on real properties within the proposed DOCBD.

October 25, 2023
3/31/24
346
DOWNTOWN ONTARIO CBD – ASSESSMENT ENGINEER’S REPORT
2 Background
The DOCBD is a is a property-based benefit assessment district being renewed for a ten (10) year term pursuant to Section 36600 et seq. of the California Streets and Highways Code (as amended), also known as the Property and Business Improvement District Law of 1994 (the “Act”). Due to the special benefit nature of assessments to be levied within the DOCBD, district program costs are to be distributed amongst all identified benefiting properties based on the proportional amount of special program benefit each property is expected to derive from the assessments levied. Within the Act, frequent references are made to the concept of relative “benefit” received from assessment funded programs and activities relative to the amount of assessment levied. Only those properties expected to derive special benefits from assessment funded programs and activities may be assessed and only in an amount proportional to the relative special benefits expected to be conferred on each property.

Supplemental Article XIIID Section 4(b) California Constitution Procedures and Requirements
Proposition 218, approved by the voters of California in November of 1996, adds a supplemental array of procedures and requirements to be carried out prior to levying a property-based assessment like the DOCBD. These requirements are in addition to requirements imposed by State and local assessment enabling laws. These requirements were “chaptered” into law as Article XIIID Section 4(b) of the California Constitution (hereinafter Article XIIID).

Since Article XIIID provisions will affect all subsequent calculations to be made in the final assessment formula for the DOCBD, each of these supplemental requirements will be taken into account and addressed in this Report. The key provisions of Article XIIID along with a description of how the DOCBD complies with each of these provisions are delineated herein. (Note: All section references below pertain to Article XIII D of the California Constitution):
347
DOWNTOWN ONTARIO CBD – ASSESSMENT ENGINEER’S REPORT
3 Finding 1. From Section 4(a): “Identify all parcels which will have a special benefit conferred upon them and upon which an assessment will be imposed”
Setting:

The proposed renewed Downtown Ontario CBD is located along Euclid Avenue (SR83) in Downtown Ontario, just south of Interstate 10 and north of Highway 60. (See attached map in Appendix 2).

General Boundary Description
The DOCBD encompasses approximately 23 blocks centered along Euclid Street in Downtown Ontario generally between N. Lemon/N. Plum Avenues on the east, N. Laurel/N. Palm Avenues on the west, W.

D/W. G Streets on the north and the transit line on the south, just south of Emporia Street.

Benefit Zones
There is one benefit zone within the proposed renewed District.

District Boundary Rationale
The proposed renewed DOCBD boundaries are comprised of the commercial core parcels where the main economic activity of Downtown Ontario is centered. The commercial parcels fronting Euclid Avenue are the historic heart of the commercial core of the city of Ontario. These parcels showcase an array of commercial retailers, restaurants, service stores, the vast Town Center block, churches and soon will be home to a full block of market rate housing and a full block of a new university. After years of little if any new development, the corridor is now experiencing a renaissance of new market rate housing development in the form of new mixed use, market rate housing. Its proximity to Interstate 10, Highway 60, the Ontario Airport and the Metrolink station in Upland makes it an ideal place to live and conduct commerce in the region. The new housing and excellent historic and contemporary housing surrounding Downtown is evolving into an emerging 21 st century mixed use community. New retail in the form of stores, restaurants and coffee shops are following the growth of high density residential on the Euclid Avenue corridor.

Northern Boundary
The northern boundary of the DOCBD is defined by the commercial parcels which are located just south of G Street from the east side of North Laurel Avenue on the west and the west side of North Lemon Avenue on the east.

Eastern Boundary
The eastern boundary of the DOCBD begins at the parcel at the west side of the intersection of West Emporia Street and North Plum Street, at parcel 1049-064-14 and runs northward along the west side of North Plum Avenue to the parcel at the southwestern corner of the intersection of East Holt Blvd and North Plum Avenue, parcel 1049-063-05. The boundary then runs westward for one block on the south side of East Holt Blvd. to the southeastern parcel of the intersection of South Lemon Avenue and East Holt Blvd., parcel 1049-063-01, and then runs northward along the western side of North Lemon Avenue up to the parcel at the southwestern corner of the intersection of East G Street and North Lemon Avenue, ending at parcel 1048-361-05.
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4 The District will only provide services to the individual assessed parcels within the boundaries; services will not be provided to parcels that are not assessed. No District programs and services will be provided east of the eastern District boundary.

Southern Boundary
The southern boundary of the DOCBD begins at parcel 1049-059-07 on West Emporia Street and runs on the south side of all the parcels on West Emporia Street to the parcel at the west side of the intersection of West Emporia Street and North Plum Street, ending at parcel 1049-064-14.

Western Boundary
The western boundary of the DOCBD is at the southeastern corner parcel at the intersection of West G Street and North Laurel Avenue (parcel 1048-356-01) and runs south along the eastern side of North Laurel to the intersection of West D Street and North Laurel Avenue. The boundary then runs straight west along the south side of West D Street to the intersection of North Palm Avenue and West G Street.

From there, the boundary runs south along the east side of North Palm Avenue from parcel 1048-561-13 southward to parcel 1049-056-06 at the intersection of West Emporia Street and North Palm Avenue. The boundary then runs west along the south side of West Emporia Street to include the western most parcel 1049-059-07.

Summation:

A list of all parcels included in the proposed renewed DOCBD are shown as Appendix 1, attached to this Report identified by their respective San Bernardino County assessor parcel numbers. The boundary of the proposed renewed DOCBD is shown on the map of the DOCBD in Appendix 2 of this Report.

All identified assessed parcels within the above-described boundaries shall be assessed to fund supplemental special benefit programs, services and improvements as outlined in the Management District Plan and this Report. All DOCBD funded services, programs and improvements provided within the above described boundaries shall confer special benefit to identified assessed parcels inside the District boundaries and none will be provided outside of the District. Each assessed parcel within the DOCBD will proportionately and specially benefit from the District funded programs and services (i.e. Civil Sidewalks, District Identity and Place Making, Administration and Contingency).

These services, programs and improvements are intended to improve commerce, employment, rents and occupancy rates and investment viability of individually assessed parcels and businesses within the DOCBD. The DOCBD confers special benefits on each individually assessed parcel by deterring crime, reducing litter and debris, improving aesthetics and marketing goods and services available from individually assessed parcels and the businesses and future residential rental units within the District, all considered necessary in a competitive properly managed Downtown district. 349
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5 All District funded services programs and improvements are supplemental, above normal base level services provided by the City of Ontario and are only provided for the special benefit of assessed parcels within the boundaries of the proposed renewed DOCBD.

The District includes 204 parcels of which all are identified as assessable which are listed in the Assessment Roll included as Appendix 1.

Finding 2. From Section 4(a): “Separate general benefits (if any) from the special benefits conferred on parcel(s). Only special benefits are assessable. “

QUANTITATIVE BENEFIT ANALYSIS
As stipulated in Article XIIID, assessment district programs and activities confer a combination of general and special benefits, but the only program benefits that can be derived from property assessments are those that provide special benefit to the assessed properties. For the purposes of this analysis, a “general benefit” is hereby defined as: “A benefit to properties in the area and in the surrounding community or benefit to the public in general resulting from the improvement, activity, or service to be provided by the assessment levied”. “Special benefit” as defined by the Article XIIID means a distinct benefit over and above general benefits conferred on real property located in the district.

The property uses within the boundaries of the DOCBD that will receive special benefits from DOCBD funded programs and services are currently an array of restaurants, retailers, offices, service businesses, and, in the near future, residential developments. No parcels within the DOCBD are zoned solely residential. Services, programs and improvements provided and funded by the DOCBD are designed to provide special benefits as described below to identified assessed parcels and the array of land uses within the boundaries of the proposed renewed DOCBD.

The proposed renewed DOCBD programs, improvements and services and Year 1 – 2025 budget allocations are as follows:

Year 1 – 2025 DOCBD Special Benefit Cost Allocations (Assessment Revenue Only) Sidewalk Operations District Identity Administration Contingency TOTAL $290,000 $96,000 $79,000 $21,776 $486,776

59.5757% 19.7216% 16.2292% 4.4735% 100%
Assessed commercial parcels as well as commercial portions of mixed-use parcels are conferred proportionate special benefits from all DOCBD funded programs, services and improvements which are intended to attract more customers, users, visitors, employees, tenants and investors. For these parcels, DOCBD programs, services and improvements are designed to increase business volumes, sales transactions, commercial occupancies and rental income. These programs, services and improvements are designed to improve commerce, security and aesthetic appeal for patrons, visitors and employees of these 350
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6 parcels within the DOCBD by deterring crime, reducing litter and debris and professionally marketing the array of goods and services available within the DOCBD, all considered necessary in a competitive properly managed contemporary business district.

For future residential parcels and residential portions of mixed-use parcels within the DOCBD it is the opinion of this Assessment Engineer that each of these parcels and uses will specially benefit from DOCBD funded programs and services which are designed to improve the cleanliness, security, marketability and livability of these parcels and residential units on them. The proportionate special benefits conferred on all residential parcels and units shall be considered in proportion to those conferred on commercial parcels within the DOCBD. For these parcels, DOCBD programs, services and improvements are designed to increase residential ownership as well as rental occupancies and income.

These programs, services and improvements are designed to improve security and aesthetic appeal for owners, tenants, visitors and landlords of these parcels within the DOCBD by deterring crime, reducing litter and debris and professionally marketing the availability of residential units for rent or sale within the DOCBD and the nearby array of goods, services and activities, all considered necessary in a competitive properly managed contemporary business district.

These benefits are particular and distinct to each and every identified and assessed parcel within the DOCBD and are not provided to non-assessed parcels outside of the DOCBD. These programs, services and improvements will only be provided to each individual assessed parcel within the DOCBD boundaries and, in turn, confer proportionate "special benefits” on each assessed parcel.

In the case of the DOCBD, the very nature of the purpose of this CBID is to fund supplemental programs, services and improvements to assessed parcels within the DOCBD boundaries above and beyond what is being currently funded either via normal tax supported methods or other funding sources. All benefits derived from the assessments to be levied on assessed parcels within the DOCBD are for services, programs and improvements directly and specially benefiting each individual assessed parcel within the DOCBD. No DOCBD funded services, activities or programs will be provided outside of the DOCBD boundaries.

While every attempt is made to provide DOCBD services and programs to confer special benefits only to those identified assessed parcels within the DOCBD, Article XIIID stipulates that general benefits exist, either by design or unintentional, in all assessment districts and that a portion of the program costs must be considered attributable to general benefits and assigned a value. General benefits cannot be funded by assessment revenues. General benefits might be conferred on parcels within the DOCBD, or “spillover” onto parcels surrounding the DOCBD, or to the public at large who might be passing through the DOCBD with no intention of transacting business within the DOCBD or interest in the DOCBD itself.

Based on a sampling of the Assessment Engineer Reports for the 250+ property based business improvement districts in California it is found that general benefits within these business improvement districts tend to range from 2-6% of the total costs. There are three methods that have been used by this Assessment Engineer for determining general and special benefit values within assessment districts:
(1) The parcel-by-parcel allocation method
(2) The program/activity line-item allocation method, and (3) The composite district overlay determinant method.
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7 A majority of CBIDs in California for which this Assessment Engineer has provided assessment engineering services in conformance with Article XIIID have used Method #3, the composite district overlay determinant method which will be used for the DOCBD. This method of computing the value of general benefit involves a composite of three distinct types of general benefit – general benefit to assessed parcels within the DOCBD, general benefit to the public at large within the DOCBD and general benefit to parcels outside the DOCBD. In the sections below, the use of the term “factor” means a numeric adjustment multiplier that is applied to the various components for which general benefit values are being computed.

General Benefit – Assessed Parcels within the DOCBD
DOCBD funded programs are narrowly designed and carefully implemented to specially benefit the assessed DOCBD parcels and are only provided for the special benefit to each and every assessed parcel within the DOCBD. It is the opinion of this Engineer, based on over 30 years of professional assessment engineering experience, that nearly 100% of benefits conferred on the 204 parcels within the DOCBD are distinct and special and in the case of the DOCBD, it is projected that there are 0.25% general benefits conferred on these parcels. While this factor can typically range from 0.10% to 1.0%, this high ratio of special benefits to general benefits (low general benefit factor) is because the DOCBD funded programs and services are specially geared to the unique needs of each parcel within the DOCBD and are directed specially only to these parcels within the DOCBD. This concept is further reinforced by the proportionality of special benefits conferred on each parcel within the DOCBD as determined by the special benefit assessment formula as it is applied to the unique and varying property characteristics of each parcel. The computed 0.25% general benefit value on the 204 parcels within the DOCBD equates to $1,217 (.25% x $486,776).

General Benefits – Outside Parcels
While DOCBD programs and services will not be provided directly to parcels outside the DOCBD boundaries, it is reasonable to conclude that DOCBD services (clean and safe) may confer an indirect general benefit on parcels adjacent to the DOCBD boundaries. An inventory of the DOCBD boundaries finds that the DOCBD is immediately surrounded by 51 parcels. Of these 51 parcels, 20 are commercial zoned parcels with commercial uses and 31 are residentially zoned parcels with residential uses or public/non-profit owned parcels with public/non-profit uses. Assessment Engineering practice has found that for districts such as the DOCBD that primarily provide clean and safe services, they may have a ”spillover” general benefit on neighboring parcels immediately outside the district. Typically, a factor of 100% (1.0) is first assigned to assessed parcels within the district, then a factor range from 3% to 6% (0.03 to 0.06) is assigned to commercial zoned and used parcels directly outside the district, then a factor range from 0.5% to 1.5% (0.005 to 0.015) is assigned to residential zoned and used parcels or public/ non- profit owned and occupied parcels directly outside the district.

The 51 parcels directly outside the DOCBD boundaries can reasonably be assumed to receive some indirect general benefit as a result of DOCBD funded programs, services and improvements. Based on over 30 years of assessment engineering experience, it is the opinion of this Engineer that a benefit factor of 1.0 be attributed to the 204 parcels within the DOCBD, a benefit factor of 0.05 be attributed to general benefits conferred on the 20 commercial parcels and uses located adjacent to or across the street from assessed parcels within the DOCBD, and a benefit factor of 0.007 be attributed to general benefits conferred on the 31 residential parcels and uses and public/non-profit owned and occupied parcels located adjacent to or across the street from assessed parcels within the DOCBD. The cumulative dollar value of this general benefit type equates to $2,911 ($2,386 + $525) as delineated in the following Table:
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8 Parcel Type Quantity Benefit
Factor
Benefit
Units
Benefit
Percent
Benefit
Value
Assessed Parcels Inside BID 204 1.000 204.00 99.4055% $486,776 Commercial Perimeter Parcels Outside BID 20 0.050 1.00 0.4873% $2,386 Other Perimeter Parcels Outside BID 31 0.007 0.22 0.1072% $525 TOTAL 205.22 100.00% $489,687
General Benefit - Public At Large
While the DOCBD funded programs are narrowly designed and carefully implemented to specially benefit the assessed DOCBD parcels and are only provided for the special benefit to each and every assessed parcel within the DOCBD, these programs also provide general benefits to the public at large within the DOCBD.

For districts such as the proposed renewed DOCBD, assessment Engineering experience in California based on several formal pedestrian intercept surveys has found that generally over 95% of people moving about within district boundaries are engaged in business related to assessed parcels and buildings and businesses/residences contained in them within the district, while the public at large “just passing through” is typically 5% or less. Districts with high levels of transit connecting nodes and patrons may have higher levels of general benefits conferred on non-engaged “passers-through”, i.e. the public at large.

Tangible services and improvements such as security, benches and shade trees would confer higher levels of general benefits on the public at large than say steam cleaned sidewalks, planters, decorative pavement and other general district management and operation activities. Typically, a factor range from 3% to 8% (0.03 to 0.08) is assigned to tangible streetscape/sidewalk type services, programs and improvements such as security, benches and shade trees; in turn, a factor range from 0.5% to 1.5% (0.005 to 0.015) is assigned to intangible services, programs and improvements such as sidewalk and pavement cleaning, general landscape improvements and ancillary services such as district management, operations and overhead.

Based on a sampling of Assessment Engineer Reports for the 250+ property based business improvement districts in California, the nature of the proposed renewed DOCBD funded programs and over 30 years of assessment engineering experience, it is the opinion of this Engineer that districtwide general benefit factors for each of the DOCBD funded special benefit program element costs that most likely provide a general benefit to the public at large are as shown in the Table below. These factors are applied to each program element costs in order to compute the dollar and percent value of districtwide general benefits to the public at large. The total dollar value of this general benefit type, public at large, equates to $5,334 as delineated in the following Table:

A B C E
Program Element Dollar Allocation General Benefit
Percent
General Benefit
Factor
General Benefit
Value (A x C)
Civil Sidewalks $290,000 1.50% 0.0150 $4,350
District Identity & Placemaking $96,000 0.50% 0.0050 $480 Administration $79,000 0.50% 0.0050 $395
Contingency $21,776 0.50% 0.0050 $109
Total $486,776 $5,334
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9 Composite General Benefit
Based on the general benefit values delineated in the three sections above, the total value of districtwide general benefits conferred on assessed parcels within the DOCBD, on parcels outside the DOCBD, and on the public at large, equates to $9,462 ($1,217 + $2,911 + $5,334) or 1.91%. For the purposes of this analysis, the districtwide general benefit factor of 1.91% will be conservatively rounded up to 2% or $9,934. This leaves a value of 98% assigned to special benefit related costs. The districtwide general benefit value of $9,934 when added to the special benefit value of $486,776 (Year 1 – 2025 assessments) equates to a total Year 1 – 2025 program cost of $496,710. Remaining costs that are attributed to districtwide general benefits will need to be derived from other non-assessment sources.

The program special benefit related cost allocations of the DOCBD assessment revenues for Year 1 (2025) are shown in the Table on page 14 of this Report. The projected program special benefit related cost allocations of the DOCBD assessment revenues for the 10-year DOCBD term, assuming a 5% maximum annual assessment rate increase, are shown in the Table on page 15 of this Report.

A breakdown of projected special and districtwide general benefits for each year of the 10-year term, assuming a 5% maximum annual assessment rate increase is shown in the following Table:
10-year Special + Districtwide General Benefits
(Assumes 5% max rate increase per year)

YR PROGRAM CATEGORY

SPECIAL

BENEFIT

ASSESSMENT
COSTS

GENERAL

BENEFIT
NON-

ASSESSMENT
COSTS
TOTAL

ADJUSTED
COSTS
% OF
TOTAL
1 Civil Sidewalks $290,000 $5,919 $295,919 59.5757%
District Identity & Placemaking $96,000 $1,959 $97,959 19.7216% Administration $79,000 $1,612 $80,612 16.2292%
Contingency $21,776 $444 $22,220 4.4735%
Total $486,776 $9,934 $496,710 100%
2 Civil Sidewalks $304,500 $6,215 $310,715 59.5757%
District Identity & Placemaking $100,800 $2,057 $102,857 19.7216% Administration $82,950 $1,693 $84,643 16.2292%
Contingency $22,865 $466 $23,331 4.4735%
Total $511,115 $10,431 $521,546 100.0000%
3 Civil Sidewalks $319,725 $6,526 $326,251 59.5757%
District Identity & Placemaking $105,840 $2,160 $108,000 19.7216% Administration $87,098 $1,778 $88,876 16.2292%
Contingency $24,008 $489 $24,497 4.4735%
Total $536,671 $10,953 $547,624 100.0000%
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10 4 Civil Sidewalks $335,711 $6,852 $342,563 59.5757%
District Identity & Placemaking $111,132 $2,268 $113,400 19.7216% Administration $91,453 $1,867 $93,320 16.2292%
Contingency $25,208 $513 $25,721 4.4735%
Total $563,504 $11,500 $575,004 100.0000%
5 Civil Sidewalks $352,497 $7,195 $359,692 59.5757%
District Identity & Placemaking $116,689 $2,381 $119,070 19.7216% Administration $96,026 $1,960 $97,986 16.2292%
Contingency $26,468 $539 $27,007 4.4735%
Total $591,680 $12,075 $603,755 100.0000%
6 Civil Sidewalks $370,122 $7,555 $377,677 59.5757%
District Identity & Placemaking $122,523 $2,500 $125,023 19.7216% Administration $100,827 $2,058 $102,885 16.2292%
Contingency $27,791 $566 $28,357 4.4735%
Total $621,263 $12,679 $633,942 100.0000%
7 Civil Sidewalks $388,628 $7,933 $396,561 59.5757%
District Identity & Placemaking $128,649 $2,625 $131,274 19.7216% Administration $105,868 $2,161 $108,029 16.2292%
Contingency $29,181 $594 $29,775 4.4735%
Total $652,326 $13,313 $665,639 100.0000%
8 Civil Sidewalks $408,059 $8,330 $416,389 59.5757%
District Identity & Placemaking $135,081 $2,756 $137,837 19.7216% Administration $111,161 $2,269 $113,430 16.2292%
Contingency $30,640 $624 $31,264 4.4735%
Total $684,941 $13,979 $698,920 100.0000%
9 Civil Sidewalks $428,462 $8,747 $437,209 59.5757%
District Identity & Placemaking $141,835 $2,894 $144,729 19.7216% Administration $116,719 $2,382 $119,101 16.2292%
Contingency $32,172 $655 $32,827 4.4735%
Total $719,188 $14,678 $733,866 100.0000%
10 Civil Sidewalks $449,885 $9,184 $459,069 59.5757%
District Identity & Placemaking $148,927 $3,039 $151,966 19.7216% Administration $122,555 $2,501 $125,056 16.2292%
Contingency $33,781 $688 $34,469 4.4735%
Total $755,148 $15,412 $770,560 100.0000%
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11 DOCBD WORK PLAN
Overview
The services, programs and improvements to be funded by the DOCBD include Civil Sidewalks, District Identity & Placemaking, Administration and Contingency. The property uses within the boundaries of the DOCBD that will receive special benefits from DOCBD funded programs, services and improvements are currently an array of restaurants, retailers, offices, service businesses, and, in the near future, residential units. Services, programs and improvements provided and funded by the DOCBD are primarily designed to provide special benefits as described below to identified assessed parcels within the boundaries of the DOCBD..

These special benefits are particular and distinct to each and every identified assessed parcel within the DOCBD and are not provided to non-assessed parcels outside of the DOCBD. These programs, services and improvements will only be provided to each individual assessed parcel within the DOCBD boundaries and, in turn, confer proportionate "special benefits” on each assessed parcel.

The very nature of the purpose of the DOCBD is to fund supplemental programs, services and improvements to assessed parcels within the DOCBD boundaries above and beyond the base line services provided by the City of Ontario. The City of Ontario does not provide these supplemental programs and services to the assessed parcels within the boundaries of the DOCBD. All benefits derived from the assessments to be levied on assessed parcels within the DOCBD are for services, programs and improvements directly and specially benefiting each individual assessed parcel within the DOCBD. No DOCBD funded services, activities or programs will be provided outside of the DOCBD boundaries.

The program special benefit cost allocations of the DOCBD assessment revenues for Year 1 (2025) are shown in the Table on page 14 of this Report. The projected program special benefit cost allocations of the DOCBD assessment revenues for the 10-year DOCBD term, assuming a 5% maximum annual assessment rate increase, are shown in the Table on page 15 of this Report.

WORK PLAN DETAILS
The services to be provided by the DOCBD (i.e. Civil Sidewalks, District Identity & Placemaking, Administration and Contingency) are all designed to contribute to the cohesive commercial and (future) residential fabric to ensure economic success and vitality of the DOCBD. The assessed parcels in the DOCBD will specially benefit from the DOCBD programs in the form of increasing commerce and improving economic success and vitality through meeting the DOCBD goals: to improve security, cleanliness, beautification, landscaping, livability and to attract and retain businesses and services, generate more pedestrian and visitor traffic and to increase commerce and improve the economic viability of each individual assessed parcel.

Assessed commercial parcels as well as commercial portions of mixed-use parcels are conferred proportionate special benefits from all DOCBD funded programs, services and improvements which are intended to attract more customers, users, visitors, employees, tenants and investors. For these parcels, DOCBD programs, services and improvements are designed to increase business volumes, sales transactions, commercial occupancies and rental income. These programs, services and improvements are designed to improve commerce, security and aesthetic appeal for patrons, visitors and employees of these 356
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12 parcels within the DOCBD by deterring crime, reducing litter and debris and professionally marketing the array of goods and services available within the DOCBD, all considered necessary in a competitive properly managed contemporary mixed-use business district.

For future residential parcels and residential portions of mixed use parcels within the DOCBD it is the opinion of this Assessment Engineer that each of these parcels and uses will specially benefit from DOCBD funded programs and services which are designed to improve the cleanliness, security, marketability and livability of these parcels and residential units on them. The proportionate special benefits conferred on all residential parcels and units shall be considered in proportion to those conferred on commercial parcels within the DOCBD. For these parcels, DOCBD programs, services and improvements are designed to increase residential ownership and rental occupancies and income. These programs, services and improvements are designed to improve security and aesthetic appeal for owners, tenants, visitors and landlords of these parcels within the DOCBD by deterring crime, reducing litter and debris and professionally marketing the availability of residential condominium and rental units within the DOCBD and the nearby array of goods, services and activities, all considered necessary in a competitive properly managed contemporary business district.

The following programs, services and improvements are proposed by the DOCBD to specially benefit each and every individually assessed parcel within the DOCBD boundaries. DOCBD services, programs and improvements will not be provided to parcels outside the DOCBD boundary.

CIVIL SIDEWALKS/SAFETY & CLEANLINESS/BEAUTIFICATION:

Examples of this category of special benefit services and costs may include, but are not limited to:
 Regular sidewalk and gutter sweeping
 Regular sidewalk steam cleaning
 Beautification of the district
 Enhanced trash emptying (over and above city services)  Timely graffiti removal, within 24 hours as necessary  Tree and vegetation maintenance (over and above city services)  Maintenance of existing and new public spaces supplemental to what is current being provided by the City of Ontario
 Installation of and maintenance of hanging plants, planting flowers throughout the district  Private security or case workers to respond to homeless issues, aggressive panhandling and mentally ill people behaving poorly in the public rights of way, including possible hiring of Ontario PD Bike patrols and/or a camera system
DISTRICT IDENTITY & PLACEMAKING:

Examples of this category of special benefit services and costs may include, but are not limited to:
 Web site development and updating
 Management and coordination of special events
 Social media
 Public relations firm
 Holiday and seasonal decorations
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13  Branding of the Downtown Ontario CBD properties so a positive image is promoted to the public
 Banner programs
 Public art displays
 Logo development
 Public space design and improvements

ADMINISTRATION & PROGRAM MANAGEMENT
Examples of this category of special benefit services and costs may include, but is not limited to:
 Staff and administrative costs
 Directors and Officers Insurance, General Liability and other insurance coverages  Office related expenses
 Rent
 Financial reporting and accounting, and legal services

CONTINGENCY
Examples of this category of special benefit services and costs include, but is not limited to:
 City and/or County fees associated with their oversight and implementation of the District,  the implementation of the Management District Plan and the Engineer’s Report.  City fees to collect and process the assessments, delinquencies and non-payments. A percentage of the budget is held in reserve to offset delinquent and/or slow payment from both public and private properties. This component also funds the expenses charged by the County of San Bernardino for collection and distribution of DOCBD revenue.  Other unanticipated costs related to the compliance of the Management District Plan and Engineer’s report.
 Funding for renewal of the District
In summary, all DOCBD funded services, programs and improvements described above confer special benefits to identified assessed parcels inside the DOCBD boundaries and none will be provided outside of the DOCBD. Each assessed parcel within the DOCBD will proportionately specially benefit from Civil Sidewalks, District Identity & Placemaking, Administration and Contingency. These services, programs and improvements are intended to improve commerce, employment, livability, rents and occupancy rates of assessed parcels within the DOCBD by deterring crime, reducing litter, installing physical improvements and professionally marketing goods, services and spaces available within the DOCBD, all necessary in a competitive properly managed contemporary business district. All DOCBD funded services programs and improvements are considered supplemental, above normal base level services provided by the City of Ontario and are only provided for the special benefit of each and every assessed parcel within the boundaries of the DOCBD.
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14 WORK PLAN BUDGET
Each identified assessed parcel within the DOCBD will be assessed the full amount of the proportionate special benefit conferred upon it. The projected DOCBD program special benefit (assessments) allocation budget for Year 1 (2025) is shown in the following Table:

DOCBD Year 1 (2025) Special Benefit Assessment Budget
Sidewalk Operations District Identity Administration Contingency TOTAL $290,000 $96,000 $79,000 $21,776 $486,776

59.5757% 19.7216% 16.2292% 4.4735% 100%
In order to carry out the DOCBD programs outlined in the previous section, a Year 1-2025 assessment budget of $486,776 is projected. Since the DOCBD is planned for a 10-year renewal term, projected program costs for future years (Years 2-10) are set at the inception of the DOCBD. While future inflationary and other program cost increases are unknown at this point, a built in maximum increase of 5% per year, commensurate to special benefits conferred on each assessed parcel, is incorporated into the projected program costs and assessment rates for the 10-year DOCBD term.

Funding carryovers, if any, may be reapportioned the following year for related programs, services and improvements in accordance with The Management District Plan. Detailed annual budgets will be prepared by the Owners’ Association Board and included in the Annual Report for the City Council’s review and approval.

It is recognized that market conditions may cause the cost of providing goods and services to fluctuate from year to year during the 10-year term of the proposed renewed DOCBD. Accordingly, the Owners’ Association shall have the ability to reallocate any budget line item within the budget categories, based on such cost fluctuations subject to the review and approval by the Owners’ Association Board. Such reallocation will be included in the Annual Report for the approval by the City of Ontario City Council pursuant to the Streets and Highways Code Section 36650. Any accrued interest or delinquent payments may be expended in any budget category in accordance with The Management District Plan.

A 10-year projected DOCBD special benefit budget is shown in the following Table:

YEAR 1-10 PROJECTED DOCBD ASSESSMENT BUDGET SUMMARY (Special Benefits) (Assumes 5% max rate increase per year)
YR
Civil
Sidewalks
District
Identity Administration Contingency TOTAL

59.5757% 19.7216% 16.2292% 4.4735% 100%
1 $290,000 $96,000 $79,000 $21,776 $486,776
2 $304,500 $100,800 $82,950 $22,865 $511,115
3 $319,725 $105,840 $87,098 $24,008 $536,671
4 $335,711 $111,132 $91,453 $25,208 $563,504
5 $352,497 $116,689 $96,026 $26,468 $591,680
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15 6 $370,122 $122,523 $100,827 $27,791 $621,263
7 $388,628 $128,649 $105,868 $29,181 $652,326
8 $408,059 $135,081 $111,161 $30,640 $684,941
9 $428,462 $141,835 $116,719 $32,172 $719,188
10 $449,885 $148,927 $122,555 $33,781 $755,148
The DOCBD assessments may increase for each individual parcel each year during the 10-year effective operating period, but not to exceed 5% per year, commensurate to special benefits received by each assessed parcel, and must be approved by the Owners’ Association Board of Directors, included in the Annual Report and approved by the City of Ontario City Council. Any accrued interest and delinquent payments will be expended within the budgeted categories. The Owners’ Association Board of the Directors (“Property Owners’ Association of the DOCBD) shall determine the percentage increase, if any, to the annual assessment, not to exceed 5% per year. The Owners’ Association Executive Director shall communicate the annual increase to the City each year in which the DOCBD operates at a time determined in the Administration Contract held between the Owners’ Association and the City of Ontario. No bonds are to be issued in conjunction with the proposed DOCBD.

Pursuant to Section 36671 of the Streets and Highways Code, any funds remaining after the 10th year of operation will be rolled over into the renewal budget or returned to stakeholders in accordance with City policies and State Law. DOCBD assessment funds may be used to pay for costs related to the following DOCBD renewal term. If the DOCBD is not renewed or terminated for any reason, unencumbered/unexpended funds will be returned to the property owners in accordance with City policies and State Law.

Finding 3. From Section 4(a): “(Determine) the proportionate special benefit derived by each parcel in relationship to the entirety of the..........cost of public improvement(s) or the maintenance and operation expenses...........or the cost of the property related service being provided.

Each identified assessed parcel within the DOCBD will be assessed based on property characteristics unique only to that parcel. Based on the specific needs and corresponding nature of the program activities to be funded by the proposed renewed DOCBD (i.e. Civil Sidewalks, District Identity & Placemaking, Administration and Contingency), it is the opinion of this Assessment Engineer that the assessment factors on which to base assessment rates relate directly to the proportionate amount of building area, land area and street frontage of each parcel, except as noted herein, all within one benefit zone.

The calculated assessment rates are applied to the actual measured parameters of each parcel and thereby are proportional to each and every other identified assessed parcel within the DOCBD. Larger parcels and those with larger buildings and/or street frontages are projected to impact the demand for services and programs to a greater extent than smaller parcels or smaller buildings and/or street frontages and thus, are assigned a greater proportionate degree of assessment program and service costs. The proportionality is further achieved by setting targeted formula component weights for the respective parcel by parcel identified property attributes.

The proportionate special benefit cost for each parcel has been calculated based on proportionate formula components and is listed as an attachment to the Management District Plan and this Report. The individual percentages (i.e. proportionate relationship to the total special benefit related program and activity costs) 360
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16 is computed by dividing the individual parcel assessment by the total special benefit program related costs.

Finding 4. From Section 4(a): “No assessment shall be imposed on any parcel which exceeds the reasonable cost of the proportional special benefit conferred on that parcel.” Not only are the proposed program costs reasonable due to the benefit of group purchasing and contracting which is possible through the proposed DOCBD, they are also considerably less than other options considered by the DOCBD Renewal Committee. The actual assessment rates for each parcel within the DOCBD directly relate to the level of service and, in turn, special benefit to be conferred on each parcel based on the respective building area, land area and street frontage of each parcel, except as noted herein, all within one benefit zone.

Finding 5. From Section 4(a): “Parcels........that are owned or used by any (public) agency shall not be exempt from assessment..........”
Article XIIID states that “parcels within a District that are owned or used by any agency, the State of California or the United States shall not be exempt from assessment unless the agency can demonstrate by clear and convincing evidence that those publicly-owned parcels in fact receive no special benefit.” There are currently 75 publicly owned parcels within the boundaries of the proposed renewed DOCBD with 55 owned by the City of Ontario, 19 by the Ontario Housing Authority, one by the San Bernardino Housing Authority and one by the Federal Government (USPS). Each identified and assessable publicly owned parcel and facility within the proposed renewed DOCBD will proportionately specially benefit as delineated herein from the proposed renewed DOCBD funded supplemental services, programs and improvements, but differently than privately owned parcels.

For publicly owned parcels and facilities within the proposed DOCBD, each of these parcels specially benefit from District funded programs services and improvements. The special benefits include cleaner and safer facility entrances and perimeters for their employees, visitors, vendors and other users of these public locations and facilities. Publicly owned parcels and facilities are active components of Downtown Ontario’s identity and fabric.

It is the opinion of this Assessment Engineer that publicly owned parcels and public facilities will not specially benefit to the same extent as privately owned parcels from the proposed renewed DOCBD funded services, programs and improvements, primarily district identity and placemaking. To offset this special benefit differential, publicly owned parcels with public facilities on them will not be assessed for public building areas located on these parcels but will be assessed for parcel land area and street frontages, the same as privately owned parcels. Publicly owned parcels with non-government uses on them will be assessed for building areas not occupied by government uses and facilities.

It is the opinion of this Assessment Engineer that there is no clear and convincing evidence that publicly owned parcels and public facilities would not receive special benefits except as noted above and thus, will not be exempt from assessments and will be assessed as described above. A listing of each publicly owned parcel and the respective Year 1 assessment within the proposed renewed DOCBD is shown in the Table below:
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17 PUBLICLY OWNED PARCELS
APN Legal Owner Site Address
Bldg
SF
Land
SF
Street
Frontage
LF
YR 1 - 2024
Assmt
Percent
of Total
1048-354-12-0000 CITY OF ONTARIO 0 25,488 321 $3,743.22 0.77% 1048-354-13-0000 CITY OF ONTARIO 0 6,580 70 $882.70 0.18% 1048-355-02-0000 CITY OF ONTARIO 0 8,469 48 $862.49 0.18% 1048-355-11-0000 CITY OF ONTARIO 0 10,217 58 $1,041.11 0.21% 1048-356-08-0000 CITY OF ONTARIO 603 N EUCLID AVE 2,480 2,480 31 $784.30 0.16% 1048-356-11-0000 CITY OF ONTARIO 0 9,799 55 $994.44 0.20% 1048-363-02-0000 CITY OF ONTARIO PARKING PKG LOT 0 38,086 411 $5,147.09 1.06% 1048-363-03-0000 CITY OF ONTARIO PARKG & ATM 0 11,512 224 $2,204.28 0.45% 1048-363-04-0000 CITY OF ONTARIO 404 N EUCLID AVE 10,500 10,080 205 $3,772.70 0.78% 1048-363-05-0000 CITY OF ONTARIO 414 N EUCLID AVE 31,973 31,901 260 $9,198.98 1.89% 1048-551-10-0000 CITY OF ONTARIO 116 E D ST. 0 46,602 430 $5,824.13 1.20% 1048-552-13-0000 CITY OF ONTARIO 126 E C ST 0 34,579 546 $5,796.64 1.19% 1048-552-14-0000 CITY OF ONTARIO 124 E C ST 0 19,096 97 $1,871.74 0.38% 1048-552-18-0000 CITY OF ONTARIO N N EUCLID 0 789 14 $142.29 0.03% 1048-553-02-0000 CITY OF ONTARIO 118 E B ST 4,450 8,496 48 $1,620.74 0.33% 1048-553-03-0000 CITY OF ONTARIO B B ST 0 8,496 48 $864.24 0.18% 1048-553-04-0000 CITY OF ONTARIO 127 N LEMON AVE 0 8,496 225 $2,014.74 0.41% 1048-553-16-0000 CITY OF ONTARIO 126 N EUCLID AVE 3,250 8,854 31 $1,329.51 0.27% 1048-553-17-0000 CITY OF ONTARIO 128 N EUCLID AVE 17,400 8,190 65 $3,912.85 0.80% 1048-562-01-0000 CITY OF ONTARIO 215 W C ST 20,826 42,834 417 $9,035.13 1.86% 1048-563-06-0000 CITY OF ONTARIO 0 9,365 226 $2,077.73 0.43% 1048-564-03-0000 CITY OF ONTARIO 139 N EUCLID AVE 15,650 8,820 196 $4,507.80 0.93% 1048-564-05-0000 CITY OF ONTARIO 125 N EUCLID AVE 2,733 3,906 36 $952.50 0.20% 1048-564-06-0000 CITY OF ONTARIO 121 N EUCLID AVE 0 7,812 61 $904.28 0.19% 1048-564-13-0000 CITY OF ONTARIO 0 6,299 58 $786.44 0.16% 1048-564-14-0000 CITY OF ONTARIO 0 9,312 97 $1,235.78 0.25% 1048-565-01-0000 CITY OF ONTARIO 127 W C ST 0 23,388 291 $3,411.72 0.70% 1048-565-02-0000 CITY OF ONTARIO 115 W C ST 2,100 2,100 30 $688.50 0.14% 1048-565-03-0000 CITY OF ONTARIO 245 N EUCLID AVE 33,804 11,782 219 $7,936.01 1.63% 1048-565-09-0000 CITY OF ONTARIO 207 N EUCLID AVE 5,560 4,000 31 $1,406.70 0.29% 1048-565-13-0000 CITY OF ONTARIO 0 5,136 107 $1,029.34 0.21% 1048-565-14-0000 CITY OF ONTARIO 0 8,448 0 $549.12 0.11% 1048-566-01-0000 CITY OF ONTARIO 123 W D ST 0 4,800 148 $1,274.00 0.26% 1048-566-02-0000 CITY OF ONTARIO 123 W D ST 6,111 8,496 48 $1,903.11 0.39% 1048-566-03-0000 CITY OF ONTARIO 0 8,496 48 $864.24 0.18% 1048-566-08-0000 CITY OF ONTARIO PARKING PKG LOT 0 2,400 0 $156.00 0.03% 1048-566-09-0000 CITY OF ONTARIO 0 14,662 100 $1,603.03 0.33% 1048-566-10-0000 CITY OF ONTARIO 0 8,496 225 $2,014.74 0.41% 1048-566-11-0000 CITY OF ONTARIO 324 N LAUREL AVE 2,208 3,696 77 $1,116.10 0.23% 1049-056-01-0000 CITY OF ONTARIO 221 W TRANSIT ST 0 15,225 254 $2,640.63 0.54% 1049-056-02-0000 CITY OF ONTARIO 211 W TRANSIT ST 0 4,872 48 $628.68 0.13% 1049-056-03-0000 CITY OF ONTARIO W TRANSIT ST 0 4,872 48 $628.68 0.13% 1049-056-04-0000 CITY OF ONTARIO 200 S LAUREL AVE 0 5,040 153 $1,322.10 0.27% 362
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18 1049-056-05-0000 CITY OF ONTARIO 208 W EMPORIA ST 15,000 15,225 250 $5,164.63 1.06% 1049-056-06-0000 CITY OF ONTARIO 228 W EMPORIA ST 0 15,225 250 $2,614.63 0.54% 1049-057-06-0000 CITY OF ONTARIO 0 5,600 156 $1,378.00 0.28% 1049-057-07-0000 CITY OF ONTARIO 206 W TRANSIT ST 0 3,723 50 $567.00 0.12% 1049-058-02-0000 CITY OF ONTARIO 0 5,077 68 $772.01 0.16% 1049-059-14-0000 CITY OF ONTARIO 0 39,403 405 $5,193.70 1.07% 1049-062-01-0000 CITY OF ONTARIO 225 S EUCLID AVE 15,000 34,087 395 $7,333.16 1.51% 1049-062-02-0000 CITY OF ONTARIO 0 38,880 412 $5,205.20 1.07% 1049-063-02-0000 CITY OF ONTARIO 214 E HOLT BLVD 11,400 13,548 97 $3,449.12 0.71% 1049-064-12-0000 CITY OF ONTARIO 0 8,064 0 $524.16 0.11% 1049-064-13-0000 CITY OF ONTARIO 217 S LEMON AVE 6,400 12,768 133 $2,782.42 0.57% 1049-064-14-0000 CITY OF ONTARIO 204 E TRANSIT ST 6,232 48,242 620 $8,225.17 1.69% CITY OF ONTARIO Total $143,889.68 29.56%
1048-551-11-0000 ONTARIO HSG AUTHORITY 312 N EUCLID AVE 0 29,886 349 $4,211.09 0.87% 1048-551-12-0000 ONTARIO HSG AUTHORITY 334 N EUCLID AVE 0 21,240 287 $3,246.10 0.67% 1048-551-13-0000 ONTARIO HSG AUTHORITY 127 E C ST 0 6,430 206 $1,756.95 0.36% 1048-552-15-0000 ONTARIO HSG AUTHORITY C C ST 0 2,439 10 $223.54 0.05% 1048-552-17-0000 ONTARIO HSG AUTHORITY 240 N EUCLID AVE 6,800 10,993 218 $3,287.55 0.68% 1048-552-24-0000 ONTARIO HSG AUTHORITY 0 24,332 195 $2,849.08 0.59% 1048-553-01-0000 ONTARIO HSG AUTHORITY 0 7,434 185 $1,685.71 0.35% 1048-553-05-0000 ONTARIO HSG AUTHORITY 115 N LEMON AVE 0 5,760 40 $634.40 0.13% 1048-553-06-0000 ONTARIO HSG AUTHORITY 127 E HOLT BLVD 0 3,810 157 $1,268.15 0.26% 1048-553-07-0000 ONTARIO HSG AUTHORITY 123 E HOLT BLVD 0 4,191 33 $486.92 0.10% 1048-553-08-0000 ONTARIO HSG AUTHORITY 121 E HOLT BLVD 0 6,731 53 $782.02 0.16% 1048-553-09-0000 ONTARIO HSG AUTHORITY 0 3,556 28 $413.14 0.08% 1048-553-10-0000 ONTARIO HSG AUTHORITY 0 2,520 146 $1,112.80 0.23% 1048-553-11-0000 ONTARIO HSG AUTHORITY 0 3,906 31 $455.39 0.09% 1048-553-12-0000 ONTARIO HSG AUTHORITY 110 N EUCLID AVE 0 3,906 31 $455.39 0.09% 1048-553-13-0000 ONTARIO HSG AUTHORITY 112 N EUCLID AVE 10,000 7,812 62 $2,610.78 0.54% 1048-553-14-0000 ONTARIO HSG AUTHORITY 118 N EUCLID AVE 0 4,268 32 $485.42 0.10% 1048-553-15-0000 ONTARIO HSG AUTHORITY 122 N EUCLID AVE 3,904 3,780 31 $1,110.88 0.23%

ONTARIO HOUSING AUTHORITY
Total $27,075.29 5.56%
1049-058-03-0000 SAN BERN COUNTY HSG AUTH 200 S EUCLID AVE 21,351 8,910 191 $5,450.32 1.12%

SAN BERN COUNTY HOUSING
AUTH Total $5,450.32 1.12%
1049-057-01-0000 US GOVT 0 22,632 430 $4,266.08 0.88%
US GOVT Total $4,266.08 0.88%
GRAND TOTAL $180,681.37 37.12%
Finding 6. From Section 4(b): “All assessments must be supported by a detailed engineer’s report prepared by a registered professional engineer certified by the State of California”.

This Report serves as the “detailed engineer’s report” to support the benefit property assessments proposed to be levied within the proposed DOCBD.
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19 Finding 7. From Section 4(c): “The amount of the proposed assessment for each parcel shall be calculated (along with) the total amount thereof chargeable to the entire district, the duration of such payments, the reason for such assessment and the basis upon which the amount of the proposed assessment was calculated.”
The individual and total parcel assessments attributable to special property benefits are shown in Appendix 1 of this Report. The proposed renewed DOCBD and resultant assessment levies will continue for 10- years and may be renewed again at that time for up to an additional 10 years for each renewal. The reasons for the proposed assessments are outlined in Finding 2 above as well as in the Management District Plan.

The calculation basis of the proposed assessment is attributed to building area, land area and street frontage of each parcel, except as noted herein, all within one benefit zone.

Assessment Formula Methodology
Step 1. Select “Basic Benefit Unit(s)”
Background - Assessment Formula Development
The method used to determine special benefits conferred on each identified assessed property within an assessment district begins with the selection of a suitable and tangible basic benefit unit. For property related services, such as those proposed in the DOCBD, the benefit unit may be measured in linear feet of street frontage or parcel size in square feet or building size in square feet or any combination of these factors. Factor quantities for each parcel are then measured or otherwise ascertained. From these figures, the amount of benefit units to be assigned to each property can be calculated. Special circumstances such as unique geography, land uses, development constraints etc. are carefully reviewed relative to specific programs and improvements to be funded by an assessment district in order to determine any levels of different benefit that may apply on a parcel-by-parcel or categorical basis.

Based on the factors described above such as geography and nature of programs and activities proposed, an assessment formula is developed which is derived from a singular or composite basic benefit unit factor or factors. Within the assessment formula, different factors may be assigned different “weights” or percentage of values based on their relationship to programs/services to be funded.

Next, all program and activity costs, including incidental costs, administration and ancillary program costs, are estimated. It is noted, as stipulated in Article XIIID Section 4(b) of the California Constitution, and required of all property-based assessment districts, indirect or general benefit related costs may not be incorporated into the assessment formula and levied on the district properties; only direct or “special” benefits related costs may be used. Indirect or general benefits, if any, must be identified and, if quantifiable, calculated and factored out of the assessment cost basis to produce a “net” cost figure. In addition, Article XIIID Section 4(b) of the California Constitution also no longer automatically exempts publicly owned property from being assessed unless the respective public agency can provide clear and convincing evidence that their property does not specially benefit from the programs and services to be funded by the proposed special assessments. If special benefit is determined to be conferred upon such properties, they must be assessed in proportion to special benefits conferred in a manner similar to privately owned property assessments. (See page 16 of this Report for discussion regarding publicly owned parcels within the DOCBD).
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20 From the estimated net program costs, the value of a basic benefit unit or “basic net unit cost” can be computed by dividing the total amount of estimated net program costs by the total number of benefit units.

The amount of assessment for each parcel can be computed at this time by multiplying the Net Unit Cost times the number of Basic Benefit Units per parcel. This is known as “spreading the assessment” or the “assessment spread” in that all costs are allocated proportionally or “spread” amongst all benefitting properties within the assessment district.

The method and basis of spreading program costs varies from one assessment district to another based on local geographic conditions, types of programs and activities proposed, and size and development complexity of the district. Assessment districts may require secondary benefit zones to be identified to allow for a tiered assessment formula for variable or “stepped-down” special benefits derived.

DOCBD Assessment Formula
Based on the specific needs and corresponding nature of the program activities to be funded by the proposed renewed DOCBD (i.e. Civil Sidewalks, District Identity & Placemaking, Administration and Contingency) it is the opinion of this Assessment Engineer that the assessment factors on which to base assessment rates relate directly to the proportionate amount of building area, land area and street frontage of each parcel, except as noted herein, all within one benefit zone.

The “Basic Benefit Units” will be expressed as a combined function of gross exterior building square footage (Benefit Unit “A”), land square footage (Benefit Unit “B”), street frontage (Benefit Unit “C”), and in the case of residential condominium parcels, internal building square footage (Benefit Unit “D”).

Based on the shape of the proposed DOCBD, as well as the nature of the work program, it is determined that all identified properties will gain a direct and proportionate degree of special benefit based on the respective amount of building area, land area and street frontage of each parcel, except as noted herein, all within one benefit zone.

The interaction of building area, land area and street frontage quantities is a common method of fairly and equitably spreading special benefit costs to the beneficiaries of district funded services, programs and improvements. These factors directly relate to the degree of special benefit each assessed parcel will receive from DOCBD funded activities.

Building area (Benefit Unit A & D) is a direct measure of the static utilization of each parcel and its corresponding impact or draw on DOCBD funded activities. The targeted combined assessment weight of building area (Units A & D) is 35%. The actual combined weight of Units A & D is 36.3387%.

Land area (Benefit Unit B) is a direct measure of the current and future development capacity of each parcel and its corresponding impact or draw on DOCBD funded activities. The targeted assessment weight of land area (Unit B) is 30%. Unit B will actually generate 27.1324% of the overall assessment revenue.

Street frontage (Benefit Unit C) is a direct measure of each parcel’s corresponding impact or draw on DOCBD funded activities. The targeted assessment weight for street frontage is 35%. Unit C will actually generate 36.5289% of the overall assessment revenue.
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21 Special Assessment Circumstances

1. Residential Condominiums
There are currently no residential condominium units within the DOCBD. It is the opinion of this Assessment Engineer that these residential condominium parcels, when built, will proportionately specially benefit from DOCBD funded programs and activities, but differently than commercial parcels and other residential rental parcels with multiple units on them. As such, based on the development configuration of such units which are generally multi floor buildings with no direct land or street frontage, the assessments for residential condominiums shall be assessed based solely on the internal building area of each residential condominium unit.

2. Multi-Unit Residential (rental)
In the opinion of this Assessment Engineer, parcels with multi-unit residential rental uses within the proposed DOCBD, will proportionately specially benefit from DOCBD funded programs, services and improvements the same as commercial parcels and uses. In the opinion of this Engineer, the level of benefit for the proposed renewed DOCBD funded programs, services and improvements for multi-unit residential use parcels is the same as commercial use parcels and the assessments shall be based on commercial assessment rates for gross exterior building area, land area and street frontage.

3. Publicly Owned and Fully Occupied Parcels
In the opinion of this Assessment Engineer, publicly owned parcels within the proposed renewed DOCBD will proportionately specially benefit from DOCBD funded programs, services and improvements but different than commercial parcels. The reason for this finding is rooted in the fact that commercial parcels and buildings provide the double benefit of directly generating income for the parcel in the form of market driven rents and, in turn, generate income to business owners as a function of retail sales areas, food and other service business space and office space to house revenue generating employees. This double benefit does not hold true for publicly owned parcels and facilities. In the opinion of this Engineer, the assessment for publicly owned parcels and facilities shall be based on land area and street frontage with no assessment levied on building area. Assessments for publicly owned parcels with for-profit occupancies or for-profit owned parcels with government occupancies shall be set at the same rates as commercial parcels and uses.

4. Non-Profit Owned-Occupied Parcels
In the opinion of this Assessment Engineer, non-profit owned-occupied parcels within the proposed renewed DOCBD will proportionately specially benefit from DOCBD funded programs, services and improvements but different than other for-profit owned-occupied commercial parcels. The reason for this finding is rooted in the fact that commercial parcels and buildings provide the double benefit of directly generating income for the parcel in the form of market driven rents and, in turn, generate income to business owners as a function of retail sales areas, food and other service business space and office space to house revenue generating employees. This double benefit does not hold true for non- profit owned-occupied parcels and facilities. In the opinion of this Engineer, the assessment for non- profit owned-occupied parcels and facilities shall be based on land area and street frontage with no assessment levied on building area. Assessments for non-profit owned parcels with for-profit occupancies or for-profit owned parcels with non-profit occupancies shall be set at the same rates as commercial parcels and uses.
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22 5. Structured Parking
In the opinion of this Assessment Engineer, building square footage that is allocated to parking solely for tenants and is NOT available to the public at any time shall have that portion of the building square footage exempted from the individual parcel’s gross building square footage. This reduction or exemption only applies to the building square footage of structured parking that is not available to public access and use. The individual parcel owner has the responsibility to inform the Property Owners’ Association if such deductions are applicable since County records to not reveal this information via County tax records.

6. Commercial and Mixed-Use Condominiums (Future)
Because such uses are typically developed as part of a multi-floor complex, special methodologies are needed to address the levy of assessments on such land uses as follows:

A. Multi-Floor Commercial Only Condominiums (no residential units) - Building area (interior) assessed at building area rate - Land area assessed at land area rate but pro-rated for each unit relative to the unit interior building area compared to the total (cumulative) interior building area of the complex - Street frontage assessed at land street frontage rate but pro-rated for each unit relative to the unit interior building area compared to the total (cumulative) interior building area of the complex
B. Multi-Floor Mixed-Use Condominiums
- Commercial condo interior building area assessed at building area rate - Residential condo interior building area assessed at residential condominium building area rate
- Commercial land area assessed at land area rate, pro-rated for each unit relative to the unit interior building area compared to the total (cumulative) interior commercial building area of the complex
- Commercial street frontage assessed at commercial street frontage rate, pro-rated for the unit interior building area compared to the total (cumulative) interior commercial building area of the complex
Changes to Building and/or Parcel Size
Any changes in building or parcel size as a result of new construction, demolitions, land adjustments including but not limited to lot splits, consolidations, subdivisions, street dedications, right of way setbacks shall have their assessment adjusted upon final City approval of such building and/or parcel adjustments.
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23 Other Future Development
Other than future maximum rates and the assessment methodology delineated in this Report, per State Law (Government Code Section 53750), future assessments may increase for any given parcel if such an increase is attributable to events other than an increased rate or revised methodology, such as a change in the density, intensity, or nature of the use of land. Any change in assessment formula methodology or rates other than as stipulated in this Report and the Plan would require a new Article XIIID ballot procedure in order to approve any such changes.

Step 2. Quantify Total Basic Benefit Units
Considering all identified specially benefiting parcels within the DOCBD and their respective assessable benefit units, the cumulative quantities by factor are shown in the following Table:

Year 1 – 2025 - Assessable Benefit Units
BLDG

AREA (SF)
LAND
AREA
(SF)
STREET

FRONTAGE
(LF)

R-CONDO
BLDG
AREA
(SF)
# OF

ASSESABLE

PARCELS
1,040,518 2,031,904 27,356 0 204
Considering all identified specially benefiting parcels within the DOCBD and their respective assessable benefit units, the cumulative assessment revenue by factor are shown in the following Table:

Year 1 – 2025 – Projected Assessment Revenue
BLDG
ASSMT $
LAND
ASSMT $
STREET

FRONTAGE
ASSMT

REVENUE

R-CONDO
BLDG
ASSMT

REVENUE
TOTAL
ASSMT

REVENUE
$176,888.06 $132,073.76 $177,814.00 $0.00 $486,775.82

36.3387% 27.1324% 36.5289% 0.0000% 100.00%
Step 3. Calculate Benefit Units for Each Property.

The number of Benefit Units for each identified benefiting parcel within the proposed renewed DOCBD was computed from data extracted from County Assessor records and maps. These data sources delineate current land uses, property areas and dimensions of record for each tax parcel. While it is understood that this data does not represent legal field survey measurements or detailed title search of recorded land subdivision maps or building records, it does provide an acceptable basis for the purpose of calculating property-based assessments. All respective property data being used for assessment computations will be provided to each property owner in the DOCBD for their review. If a property owner believes there is an error on a parcel’s assessed footages, the DOCBD may confirm the data with the Ontario County Assessor’s office. If DOCBD data matches Assessor’s data, the property owner may opt to work with the Assessor’s office to correct the data so that the DOCBD assessment may be corrected. 368
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24 Step 4. Determine Assessment Formula
In the opinion of this Assessment Engineer, the assessment formula for the proposed DOCBD, except as noted herein, is as follows:

Assessment = Building Area (Unit A) Sq Ft x Unit A Rate, plus Land Area (Unit B) Sq Ft x Unit B Rate, plus
Street Frontage (Unit C) Lin Ft x Unit C Rate
or
= Residential Condo Building Area (Unit D) Sq Ft x Unit D Rate Assessment Formula Unit Rates
Based on figures from the Assessable Benefit Units Table and the Projected Assessment Revenue on page 23, the assessment rates for each factor and zone are shown as calculated below:

Building Area Rate (Unit A)
($486,775.82 x 36.3387%)/1,040,518 units = $0.17/sq ft building area Land Area Rate (Unit B)
($486,775.82 x 27.1324%)/2,031,904 units = $0.065/sq ft land area Street Frontage Rate (Unit C)
($486,775.82 x 36.5289%)/27,356 units = $6.50/lin ft street frontage Residential Condo Building Area Rate (Unit D) = $0.20/sq ft building area YEAR 1 –2025 Assessment Rates

BLDG ASSMT
RATE ($/SF)

LAND ASSMT
RATE
($/SF )
STREET

FRONTAGE

ASSMT RATE
($/LF)

R-CONDO
BLDG
ASSMT
RATE
$0.17 $0.065 $6.50 $0.20
The complete Year 1 – 2025 assessment roll of all parcels to be assessed by the DOCBD is included in this Report as Appendix 1.
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25 Step 5. Estimate Total DOCBD Costs
The total projected 10-year DOCBD special benefit costs for 2025 – 2034 are shown in the Table on page 15 of this Report assuming a maximum 5% increase per year.

Step 6. Separate General Benefits from Special Benefits and Related Costs (Article XIIID) Total Year 1 special and districtwide general benefit related costs are estimated at $496,710. Districtwide general benefits are factored at 2% of the total benefit value (see Finding 2 of this Report) with special benefits set at 98%. Article XIIID limits the levy of property assessments to costs attributed to special benefits only. The 2% general benefit value is computed to be $9,934 with a resultant 98% special benefit limit computed at $486,776. Based on current property data and land uses, this is the maximum amount of Year 1 (2025) revenue that can be derived from property assessments from the subject District. All program costs associated with district wide and site/activity specific general benefits will be derived from sources other than DOCBD assessments.

Step 7. Calculate “Basic Unit Cost”
With a YR 1 - 2025 assessment revenue portion of the budget set at $486,776 (special benefit only), the Basic Unit Costs (rates) are shown earlier in Step 4. Since the DOCBD is proposed to be renewed for a 10- year term, maximum assessments for future years (2025-2034) must be set at the inception of the proposed renewed DOCBD. An annual inflationary assessment rate increase of up to 5%, commensurate to special benefits received by each assessed parcel, may be imposed for future year assessments, on approval by the DOCBD Property Owner’s Association. The maximum assessment rates for the 10-year proposed renewed DOCBD renewal term of 2025-2034 are shown in the Table below. The assessment rates listed constitute the maximum assessment rates that may be imposed for each year of the proposed renewed DOCBD term (2025-2034).

DOCBD – 10-year Maximum Assessment Rates
(Includes a 5%/Yr. Max Increase)

YEAR
BLDG
ASSMT
RATE
($/SF)
LAND
ASSMT
RATE
($/SF )

FRONTAGE
ASSMT
RATE
($/LF)

R-CONDO
BLDG
ASSMT
RATE
($/SF)
1 $0.1700 $0.0650 $6.5000 $0.2000
2 $0.1785 $0.0683 $6.8250 $0.2100
3 $0.1874 $0.0717 $7.1663 $0.2205
4 $0.1968 $0.0753 $7.5246 $0.2315
5 $0.2066 $0.0791 $7.9008 $0.2431
6 $0.2169 $0.0831 $8.2958 $0.2553
370
DOWNTOWN ONTARIO CBD – ASSESSMENT ENGINEER’S REPORT
26 7 $0.2277 $0.0873 $8.7106 $0.2681
8 $0.2391 $0.0917 $9.1461 $0.2815
9 $0.2511 $0.0963 $9.6034 $0.2956
10 $0.2637 $0.1011 $10.0836 $0.3104
Step 8. Spread the Assessments
The resultant assessment spread calculation for each parcel within the DOCBD are shown in the Management District and this Report and were determined by applying the DOCBD assessment formula to each identified benefiting property. The complete Year 1 – 2025 assessment roll of all parcels to be assessed by the DOCBD is included in this Report as Appendix 1.

Miscellaneous DOCBD Provisions
Time and Manner of Collecting Assessments:

Assessments shall be collected at the same time and in the same manner as ad valorum taxes paid to the County of San Bernardino (Operation Years 2025-2034). The DOCBD assessments shall appear as a separate line item on the property tax bills issued by the San Bernardino County Assessor. The City of Ontario is authorized to collect any assessments not placed on the County tax rolls, or to place assessments, unpaid delinquent assessments, or penalties on the County tax rolls as appropriate to implement the Management District Plan.

Bonds:

No bonds are to be issued in conjunction with this proposed DOCBD.

Duration
As allowed by State Law, the DOCBD will have a ten (10) year operational term from January 1, 2025 to December 31, 2034. The proposed renewed DOCBD operation is expected to begin services on January 1, 2025. If the DOCBD is not renewed again at the end of the proposed 10-year renewal term, services will end on December 31, 2034.
371
DOWNTOWN ONTARIO CBD – ASSESSMENT ENGINEER’S REPORT
27 APPENDIX 1
DOCBD
YR 1 – 2025

ASSESSMENT ROLL
372
28 APN Site Address Bldg SF Land SF
Street
Frontage
LF
YR 1 - 2024
Assmt
Percent
of Total
1048-354-01-0000 123 W E ST 0 10,058 201 $1,960.27 0.40% 1048-354-02-0000 123 W E ST 18,084 8,850 50 $3,974.53 0.82% 1048-354-03-0000 437 N EUCLID AVE 9,068 7,812 187 $3,264.84 0.67% 1048-354-04-0000 429 N EUCLID AVE 3,875 3,875 31 $1,112.13 0.23% 1048-354-05-0000 427 N EUCLID AVE 900 1,100 16 $328.50 0.07% 1048-354-06-0000 425 N EUCLID AVE 1,200 1,890 16 $430.85 0.09% 1048-354-07-0000 421 N EUCLID AVE 7,172 5,418 42 $1,844.41 0.38% 1048-354-08-0000 419 N EUCLID AVE 2,400 2,520 20 $701.80 0.14% 1048-354-09-0000 417 N EUCLID AVE 3,875 3,875 31 $1,112.13 0.23% 1048-354-10-0000 413 N EUCLID AVE 3,100 3,906 31 $982.39 0.20% 1048-354-11-0000 401 N EUCLID AVE 9,325 15,750 250 $4,234.00 0.87% 1048-354-12-0000 0 25,488 321 $3,743.22 0.77%
1048-354-13-0000 0 6,580 70 $882.70 0.18%
1048-355-02-0000 0 8,469 48 $862.49 0.18%
1048-355-03-0000 537 N EUCLID AVE 4,900 5,922 173 $2,342.43 0.48% 1048-355-04-0000 531 N EUCLID AVE 4,042 5,764 46 $1,360.80 0.28% 1048-355-05-0000 527 N EUCLID AVE 1,659 3,927 31 $738.79 0.15% 1048-355-06-0000 523 N EUCLID AVE 2,449 3,876 41 $934.77 0.19% 1048-355-07-0000 521 N EUCLID AVE 6,193 7,560 44 $1,830.21 0.38% 1048-355-08-0000 517 N EUCLID AVE 4,579 5,555 44 $1,425.51 0.29% 1048-355-11-0000 0 10,217 58 $1,041.11 0.21%
1048-355-13-0000 516 N LAUREL AVE 1,555 5,358 57 $983.12 0.20% 1048-355-15-0000 125 W F ST 7,204 16,992 333 $4,493.66 0.92% 1048-355-16-0000 507 N N EUCLID 2,349 15,646 250 $3,041.32 0.62% 1048-356-01-0000 123 W G ST 7,083 19,492 259 $4,154.59 0.85% 1048-356-02-0000 635 N EUCLID AVE 8,640 10,396 208 $3,496.54 0.72% 1048-356-03-0000 625 N EUCLID AVE 3,449 5,850 48 $1,278.58 0.26% 1048-356-04-0000 621 N EUCLID AVE 4,091 5,670 45 $1,356.52 0.28% 1048-356-05-0000 615 N EUCLID AVE 12,400 7,812 62 $3,018.78 0.62% 1048-356-06-0000 611 N EUCLID AVE 1,752 3,906 31 $753.23 0.15% 1048-356-07-0000 N EUCLID AVE 0 3,906 31 $455.39 0.09%
1048-356-08-0000 603 N EUCLID AVE 2,480 2,480 31 $784.30 0.16% 1048-356-09-0000 601 N EUCLID AVE 2,170 2,480 111 $1,251.60 0.26% 1048-356-10-0000 110 W F ST 0 2,852 46 $484.38 0.10%
1048-356-11-0000 0 9,799 55 $994.44 0.20%
1048-356-12-0000 128 W F ST 0 16,992 273 $2,878.98 0.59% 1048-356-13-0000 622 N LAUREL AVE 2,068 5,564 62 $1,116.22 0.23% 1048-361-01-0000 636 N EUCLID AVE 5,454 15,710 250 $3,573.33 0.73% 1048-361-02-0000 PARKING PKG LOT 0 7,681 48 $811.27 0.17% 1048-361-03-0000 120 E G ST 0 6,930 50 $775.45 0.16%
1048-361-04-0000 128 E G ST 2,017 7,140 191 $2,048.49 0.42% 1048-361-05-0000 615 N LEMON AVE 1,182 3,108 121 $1,189.46 0.24% 1048-361-06-0000 613 N LEMON AVE 0 8,352 58 $919.88 0.19% 1048-361-07-0000 609 N LEMON AVE 7,130 8,928 62 $2,195.42 0.45% 1048-361-08-0000 115 E F ST 5,292 8,352 202 $2,755.52 0.57% 1048-361-09-0000 602 N EUCLID AVE 6,492 7,855 188 $2,836.22 0.58% 1048-361-10-0000 608 N EUCLID AVE 5,263 7,812 62 $1,805.49 0.37% 1048-361-11-0000 616 N EUCLID AVE 0 7,812 62 $910.78 0.19% 373
DOWNTOWN ONTARIO CBD – ASSESSMENT ENGINEER’S REPORT
29 1048-361-12-0000 620 N EUCLID AVE 0 7,855 62 $913.58 0.19% 1048-362-02-0000 0 8,142 46 $828.23 0.17%
1048-362-03-0000 124 E F ST 9,342 16,800 273 $4,454.64 0.92% 1048-362-04-0000 515 N LEMON 2,209 7,680 86 $1,433.73 0.29% 1048-362-05-0000 LEMON ST 0 8,736 187 $1,783.34 0.37%
1048-362-06-0000 121 E ST 1,940 8,640 49 $1,209.90 0.25% 1048-362-07-0000 506 N EUCLID AVE 1,148 15,624 250 $2,835.72 0.58% 1048-362-08-0000 516 N EUCLID AVE 11,096 11,718 93 $3,252.49 0.67% 1048-362-09-0000 536 N EUCLID ST 0 11,782 220 $2,195.83 0.45% 1048-362-10-0000 534 N EUCLID ST 0 7,855 62 $913.58 0.19% 1048-363-01-0000 434 N EUCLID AVE 100 5,136 160 $1,390.84 0.29% 1048-363-02-0000 PARKING PKG LOT 0 38,086 411 $5,147.09 1.06% 1048-363-03-0000 PARKG & ATM 0 11,512 224 $2,204.28 0.45% 1048-363-04-0000 404 N EUCLID AVE 10,500 10,080 205 $3,772.70 0.78% 1048-363-05-0000 414 N EUCLID AVE 31,973 31,901 260 $9,198.98 1.89% 1048-551-10-0000 116 E D ST. 0 46,602 430 $5,824.13 1.20% 1048-551-11-0000 312 N EUCLID AVE 0 29,886 349 $4,211.09 0.87% 1048-551-12-0000 334 N EUCLID AVE 0 21,240 287 $3,246.10 0.67% 1048-551-13-0000 127 E C ST 0 6,430 206 $1,756.95 0.36% 1048-552-13-0000 126 E C ST 0 34,579 546 $5,796.64 1.19% 1048-552-14-0000 124 E C ST 0 19,096 97 $1,871.74 0.38% 1048-552-15-0000 C C ST 0 2,439 10 $223.54 0.05%
1048-552-17-0000 240 N EUCLID AVE 6,800 10,993 218 $3,287.55 0.68% 1048-552-18-0000 N N EUCLID 0 789 14 $142.29 0.03%
1048-552-22-0000 200 N EUCLID AVE 8,828 8,509 213 $3,438.35 0.71% 1048-552-23-0000 200 N EUCLID AVE. 0 1,786 0 $116.09 0.02% 1048-552-24-0000 0 24,332 195 $2,849.08 0.59%
1048-553-01-0000 0 7,434 185 $1,685.71 0.35%
1048-553-02-0000 118 E B ST 4,450 8,496 48 $1,620.74 0.33% 1048-553-03-0000 B ST 0 8,496 48 $864.24 0.18%
1048-553-04-0000 127 N LEMON AVE 0 8,496 225 $2,014.74 0.41% 1048-553-05-0000 115 N LEMON AVE 0 5,760 40 $634.40 0.13% 1048-553-06-0000 127 E HOLT BLVD 0 3,810 157 $1,268.15 0.26% 1048-553-07-0000 123 E HOLT BLVD 0 4,191 33 $486.92 0.10% 1048-553-08-0000 121 E HOLT BLVD 0 6,731 53 $782.02 0.16% 1048-553-09-0000 0 3,556 28 $413.14 0.08%
1048-553-10-0000 0 2,520 146 $1,112.80 0.23%
1048-553-11-0000 0 3,906 31 $455.39 0.09%
1048-553-12-0000 110 N EUCLID AVE 0 3,906 31 $455.39 0.09% 1048-553-13-0000 112 N EUCLID AVE 10,000 7,812 62 $2,610.78 0.54% 1048-553-14-0000 118 N EUCLID AVE 0 4,268 32 $485.42 0.10% 1048-553-15-0000 122 N EUCLID AVE 3,904 3,780 31 $1,110.88 0.23% 1048-553-16-0000 126 N EUCLID AVE 3,250 8,854 31 $1,329.51 0.27% 1048-553-17-0000 128 N EUCLID AVE 17,400 8,190 65 $3,912.85 0.80% 1048-561-07-0000 303 N LAUREL AVE 3,417 8,496 225 $2,595.63 0.53% 1048-561-08-0000 210 W C ST 3,845 17,169 96 $2,393.64 0.49% 1048-561-09-0000 218 W C ST 1,392 8,554 48 $1,104.65 0.23% 1048-561-10-0000 220 W C ST 0 8,496 48 $864.24 0.18%
1048-561-11-0000 228 W C ST 1,190 8,400 123 $1,547.80 0.32% 374
DOWNTOWN ONTARIO CBD – ASSESSMENT ENGINEER’S REPORT
30 1048-561-12-0000 312 N PALM AVE 1,728 4,896 102 $1,275.00 0.26% 1048-561-13-0000 109,032 54,516 642 $26,251.98 5.39%
1048-562-01-0000 215 W C ST 20,826 42,834 417 $9,035.13 1.86% 1048-562-02-0000 223 N LAUREL AVE 4,178 8,496 225 $2,725.00 0.56% 1048-562-03-0000 205 N LAUREL AVE 19,923 34,161 369 $8,005.88 1.64% 1048-562-06-0000 212 N PALM AVE 1,980 2,658 55 $866.87 0.18% 1048-562-07-0000 210 N PALM AVE 0 13,032 170 $1,952.08 0.40% 1048-563-01-0000 225 W B ST 1,194 6,096 175 $1,736.72 0.36% 1048-563-02-0000 W B ST 0 8,496 48 $864.24 0.18%
1048-563-03-0000 217 W B ST 6,767 16,992 96 $2,878.87 0.59% 1048-563-06-0000 0 9,365 226 $2,077.73 0.43%
1048-563-07-0000 202 W HOLT BLVD 5,154 7,536 48 $1,678.02 0.34% 1048-563-08-0000 210 W HOLT BLVD 16,692 16,992 96 $4,566.12 0.94% 1048-563-09-0000 222 W HOLT BLVD 0 8,496 46 $851.24 0.17% 1048-563-10-0000 220 W HOLT BLVD 0 8,496 225 $2,014.74 0.41% 1048-563-11-0000 120 N PALM AVE 790 2,400 47 $595.80 0.12% 1048-563-12-0000 209 W B ST 3,360 7,953 48 $1,400.15 0.29% 1048-563-13-0000 203 W B ST 13,104 8,754 225 $4,259.19 0.87% 1048-564-01-0000 121 W B ST 6,888 7,680 176 $2,814.16 0.58% 1048-564-02-0000 115 W B ST 16,724 8,496 48 $3,707.32 0.76% 1048-564-03-0000 139 N EUCLID AVE 15,650 8,820 196 $4,507.80 0.93% 1048-564-04-0000 131 N EUCLID AVE 4,125 6,875 55 $1,505.63 0.31% 1048-564-05-0000 125 N EUCLID AVE 2,733 3,906 36 $952.50 0.20% 1048-564-06-0000 121 N EUCLID AVE 0 7,812 61 $904.28 0.19% 1048-564-07-0000 109 N EUCLID AVE 10,572 10,278 93 $3,069.81 0.63% 1048-564-08-0000 107 N EUCLID AVE 3,472 1,835 21 $846.02 0.17% 1048-564-09-0000 103 N EUCLID AVE 3,960 2,132 93 $1,416.28 0.29% 1048-564-10-0000 102 W HOLT BLVD 8,660 4,330 74 $2,234.65 0.46% 1048-564-11-0000 114 W HOLT BLVD 3,615 8,622 48 $1,486.98 0.31% 1048-564-12-0000 118 W HOLT BLVD 8,653 8,914 214 $3,441.42 0.71% 1048-564-13-0000 0 6,299 58 $786.44 0.16%
1048-564-14-0000 0 9,312 97 $1,235.78 0.25%
1048-565-01-0000 127 W C ST 0 23,388 291 $3,411.72 0.70% 1048-565-02-0000 115 W C ST 2,100 2,100 30 $688.50 0.14% 1048-565-03-0000 245 N EUCLID AVE 33,804 11,782 219 $7,936.01 1.63% 1048-565-04-0000 235 N EUCLID AVE 2,400 1,536 24 $663.84 0.14% 1048-565-05-0000 231 N EUCLID AVE 11,976 5,820 37 $2,654.72 0.55% 1048-565-06-0000 219 N EUCLID AVE 7,812 7,812 62 $2,238.82 0.46% 1048-565-07-0000 215 N EUCLID AVE 3,696 4,032 31 $1,091.90 0.22% 1048-565-08-0000 211 N EUCLID AVE 3,480 3,780 31 $1,038.80 0.21% 1048-565-09-0000 207 N EUCLID AVE 5,560 4,000 31 $1,406.70 0.29% 1048-565-10-0000 203 N EUCLID AVE 7,938 7,812 188 $3,079.24 0.63% 1048-565-11-0000 112 W B ST 36,864 9,216 95 $7,483.42 1.54% 1048-565-12-0000 126 W B ST 3,296 3,360 118 $1,545.72 0.32% 1048-565-13-0000 0 5,136 107 $1,029.34 0.21%
1048-565-14-0000 0 8,448 0 $549.12 0.11%
1048-566-01-0000 123 W D ST 0 4,800 148 $1,274.00 0.26% 1048-566-02-0000 123 W D ST 6,111 8,496 48 $1,903.11 0.39% 1048-566-03-0000 0 8,496 48 $864.24 0.18%
375
DOWNTOWN ONTARIO CBD – ASSESSMENT ENGINEER’S REPORT
31 1048-566-04-0000 325 N EUCLID AVE 10,840 11,844 219 $4,036.16 0.83% 1048-566-05-0000 317 N EUCLID AVE 35,524 17,262 136 $8,045.11 1.65% 1048-566-06-0000 313 N EUCLID AVE 5,800 6,552 52 $1,749.88 0.36% 1048-566-07-0000 301 N EUCLID AVE 12,003 11,718 219 $4,225.68 0.87% 1048-566-08-0000 PUBLIC PARKING LOT 0 2,400 0 $156.00 0.03% 1048-566-09-0000 0 14,662 100 $1,603.03 0.33%
1048-566-10-0000 0 8,496 225 $2,014.74 0.41%
1048-566-11-0000 324 N LAUREL AVE 2,208 3,696 77 $1,116.10 0.23% 1049-055-01-0000 221 W HOLT BLVD 9,064 9,064 192 $3,378.04 0.69% 1049-055-02-0000 215 W HOLT BLVD 3,738 3,738 42 $1,151.43 0.24% 1049-055-03-0000 213 W HOLT AVE 4,361 4,361 50 $1,349.84 0.28% 1049-055-04-0000 205 W HOLT BLVD 4,183 4,183 47 $1,288.51 0.26% 1049-055-05-0000 201 E HOLT BLVD 1,000 4,272 137 $1,338.18 0.27% 1049-055-06-0000 0 4,301 137 $1,170.07 0.24%
1049-055-07-0000 0 4,183 47 $577.40 0.12%
1049-055-08-0000 0 4,301 48 $591.57 0.12%
1049-055-09-0000 115 S PALM AVE 12,905 12,816 233 $4,541.39 0.93% 1049-056-01-0000 221 W TRANSIT ST 0 15,225 254 $2,640.63 0.54% 1049-056-02-0000 211 W TRANSIT ST 0 4,872 48 $628.68 0.13% 1049-056-03-0000 W TRANSIT ST 0 4,872 48 $628.68 0.13%
1049-056-04-0000 200 S LAUREL AVE 0 5,040 153 $1,322.10 0.27% 1049-056-05-0000 208 W EMPORIA ST 15,000 15,225 250 $5,164.63 1.06% 1049-056-06-0000 228 W EMPORIA ST 0 15,225 250 $2,614.63 0.54% 1049-057-01-0000 0 22,632 430 $4,266.08 0.88%
1049-057-02-0000 117 W HOLT BLVD 4,428 4,428 56 $1,404.58 0.29% 1049-057-03-0000 100 S EUCLID AVE 5,212 5,280 158 $2,256.24 0.46% 1049-057-04-0000 108 S EUCLID AVE 6,680 3,520 31 $1,565.90 0.32% 1049-057-05-0000 110 S EUCLID AVE 9,000 4,900 430 $4,643.50 0.95% 1049-057-06-0000 0 5,600 156 $1,378.00 0.28%
1049-057-07-0000 206 W TRANSIT ST 0 3,723 50 $567.00 0.12% 1049-058-01-0000 119 W TRANSIT ST 8,654 9,856 208 $3,463.82 0.71% 1049-058-02-0000 0 5,077 68 $772.01 0.16%
1049-058-03-0000 200 S EUCLID AVE 21,351 8,910 191 $5,450.32 1.12% 1049-058-04-0000 214 EUCLID AVE 4,048 9,000 214 $2,664.16 0.55% 1049-058-05-0000 211 S LAUREL AVE 3,920 13,346 204 $2,859.89 0.59% 1049-059-07-0000 303 W EMPORIA ST 0 6,136 52 $736.84 0.15% 1049-059-08-0000 301 EMPORIA ST 2,910 8,140 74 $1,504.80 0.31% 1049-059-09-0000 223 EMPORIA ST 0 8,140 56 $893.10 0.18% 1049-059-14-0000 0 39,403 405 $5,193.70 1.07%
1049-059-21-0000 211 W EMPORIA ST 22,935 29,645 269 $7,574.38 1.56% 1049-061-01-0000 150 E HOLT BLVD 57,930 20,097 428 $13,936.41 2.86% 1049-061-02-0000 150 E HOLT BLVD 0 20,196 427 $4,088.24 0.84% 1049-061-03-0000 0 4,488 48 $603.72 0.12%
1049-062-01-0000 225 S EUCLID AVE 15,000 34,087 395 $7,333.16 1.51% 1049-062-02-0000 0 38,880 412 $5,205.20 1.07%
1049-063-01-0000 204 E HOLT BLVD 5,536 9,021 190 $2,762.49 0.57% 1049-063-02-0000 214 E HOLT BLVD 11,400 13,548 97 $3,449.12 0.71% 1049-063-03-0000 220 E HOLT BLVD 1,040 1,504 17 $385.06 0.08% 1049-063-04-0000 222 E HOLT BLVD 2,080 3,008 31 $750.62 0.15% 376
DOWNTOWN ONTARIO CBD – ASSESSMENT ENGINEER’S REPORT
32 1049-063-05-0000 230 E HOLT BLVD 1,614 4,512 142 $1,490.66 0.31% 1049-063-06-0000 120 S PLUM AVE 3,384 4,512 142 $1,791.56 0.37% 1049-063-07-0000 223 E TRANSIT ST 1,645 4,464 48 $881.81 0.18% 1049-063-08-0000 TRANSIT ST 0 9,021 96 $1,210.37 0.25%
1049-063-09-0000 119 S LEMON AVE 0 4,559 143 $1,225.84 0.25% 1049-063-10-0000 111 S LEMON AVE 4,000 4,559 47 $1,281.84 0.26% 1049-064-12-0000 0 8,064 0 $524.16 0.11%
1049-064-13-0000 217 S LEMON AVE 6,400 12,768 133 $2,782.42 0.57% 1049-064-14-0000 204 E TRANSIT ST 6,232 48,242 620 $8,225.17 1.69% 1,040,518 2,031,904 27,356 $486,775.82 100.00%
377
33 APPENDIX 2

DOCBD BOUNDARY MAP
378
DOWNTOWN ONTARIO CBD – ASSESSMENT ENGINEER’S REPORT
34 379
RESOLUTION NO. _______

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ONTARIO,

CALIFORNIA, STATING ITS INTENTION TO RENEW THE DOWNTOWN

ONTARIO COMMUNITY BENEFIT DISTRICT AND TO LEVY AND

COLLECT ASSESSMENTS WITHIN SUCH DISTRICT PURSUANT TO

THE ESTABLISHMENT OF PROPERTY BUSINESS IMPROVEMENT
DISTRICTS, SECTION 36600 OF THE CALIFORNIA STREETS AND

HIGHWAY CODE, AND APPOINTING A TIME AND PLACE FOR
HEARING OBJECTIONS THERETO.

WHEREAS, the Property Business Improvement District Law of 1994, (the “Law”) authorizes Property Business Improvement Districts (“PBID”) to promote the economic revitalization and physical maintenance of mixed use and business districts in the City of Ontario (the “City”); and
WHEREAS, the Law authorizes the levy and collection of assessments on real property within such districts for the purpose of providing improvements and promoting activities that specially benefit real property within such districts; and WHEREAS, articles XIIIC and XIIID of the California Constitution and Section 53753 of the California Government Code impose certain procedural and substantive requirements relating to the levy of new or increased assessments; and WHEREAS, the City established the Downtown Ontario Community Benefit District (the “District”) in 2019 and now intends to renew the District for a period of ten (10) additional years pursuant to the Law; and
WHEREAS, written petitions have been submitted by District property owners requesting the City Council to initiate proceedings pursuant to the Law to renew the District for up to a maximum ten (10) year renewal term; and WHEREAS, such petitions were signed by property owners owning property within the boundaries of the District who will pay more than fifty percent (50%) of the assessments proposed to be renewed and levied; and
WHEREAS, no real properties deriving special benefit within the District will be exempted from payment of the assessments; and
WHEREAS, a Management District Plan entitled the “Management District Plan for the Downtown Ontario Improvement Association and The City of Ontario” (the “Management District Plan”) has been prepared and submitted to the City Clerk, containing all of the information required by Section 36622 of the California Streets and Highway Code, including a description of the boundaries of the District, the improvements and activities proposed for the District, and the cost of such improvements and activities; and WHEREAS, the City now desires to renew the District for a period of ten (10) years. 380
NOW THEREFORE, BE IT RESOLVED by the City Council of the City of Ontario, California, as follows:

SECTION 1. The foregoing recitals are true and correct and are incorporated herein by this reference.

SECTION 2. Pursuant to Section 36621(a) of the California Streets and Highway Code, the City hereby declares its intention to renew the District and to levy and collect assessments against lots and parcels of real property within the District commencing with fiscal year 2024-25 and each fiscal year for a period not to exceed ten (10) years.

SECTION 3. The City Council hereby approves the Management District Plan, on file in the office of the City Clerk.

SECTION 4. The City Clerk shall make the Management District Plan, the Assessment Engineer’s report, and other documents related to the District available to the public for review during normal business hours.

SECTION 5. NOTICE IS HEREBY GIVEN that the City Council shall conduct a public hearing on the renewal of the District and the levy and collection of assessments beginning Fiscal Year 2024-25 on January 16, 2024 at 6:30 p.m. or as soon thereafter as the matter may be heard, in the City Council Chambers located at 303 East B St, Ontario, California 91764. At the public hearing, the City Council will consider all objections or protests, if any, to the proposed renewal of the District and the proposed assessment.

Any interested person may present written or oral testimony at the public hearing. At the conclusion of the public testimony portion of the public hearing, the City Clerk shall open and tabulate all ballots received and not withdrawn at that time. Results of the ballot procedure will be announced, and, provided a weighted majority in opposition to the District renewal does not occur, the City Council may then renew the District by adopting a resolution to that effect.

SECTION 6. The boundaries of the District generally include all properties listed within the boundaries of the map on file in the Management District Plan filed in the City Clerk’s office.

SECTION 7. The activities for the District may include sidewalk cleaning, private security, beautification, marketing and promotional activities, administration of the services, public space development and enhancement for residential property owners in the District, and the funding of contingency/reserve account. All proposed services and improvements specially benefit real property owners located in the District.

SECTION 8. The assessment proposed to be levied and collected on properties within the renewed District for fiscal year 2024-25 is $486,776.00. The amount to be levied and collected for subsequent years may be increased, by an amount not to exceed five (5) percent per year provided, however, assessments shall not be increased to exceed the proportionate special benefit conferred on any parcel. No bonds will be issued.
381
SECTION 9. The City Clerk is hereby authorized and directed to give notice of the public hearing as provided in Section 53753 of the Government Code and Article XIIID, Section 4 of the California Constitution.

SECTION 10. This Resolution shall become effective immediately upon its adoption.

The City Clerk of the City of Ontario shall certify as to the adoption of this Resolution.

PASSED, APPROVED, AND ADOPTED this 7th day of November 2023. _____________________________________
PAUL S. LEON, MAYOR
ATTEST:
____________________________________

SHEILA MAUTZ, CITY CLERK
APPROVED AS TO FORM:
____________________________________

BEST BEST & KRIEGER LLP

CITY ATTORNEY
382

STATE OF CALIFORNIA )

COUNTY OF SAN BERNARDINO )

CITY OF ONTARIO )
I, SHEILA MAUTZ, City Clerk of the City of Ontario, DO HEREBY CERTIFY that foregoing Resolution No. 2023- was duly passed and adopted by the City Council of the City of Ontario at their regular meeting held November 7, 2023 by the following roll call vote, to wit:

AYES: COUNCIL MEMBERS:

NOES: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:
____________________________________

SHEILA MAUTZ, CITY CLERK
(SEAL)
The foregoing is the original of Resolution No. 2023- duly passed and adopted by the Ontario City Council at their regular meeting held November 7, 2023. _____________________________________

SHEILA MAUTZ, CITY CLERK
(SEAL)
383
Department: Communications and Community
Relations
Prepared By: Tricia Almiron
Staff Member Presenting:

Dan Bell, Communications and Community
Relations Director
Approved By:

Submitted To: Council/OHA
Approved: _______________________________
Continued To: ___________________________
Denied: __________________________________
Item No: 17
SUBJECT:

UPDATED LEGISLATIVE PLATFORMS

CITY OF ONTARIO
Agenda Report
November
7, 2023
SECTION:

CONSENT CALENDAR

RECOMMENDATION:

That the Council approve the 2024 State and Federal Legislative Platforms.

THE FOLLOWING COUNCIL GOALS ARE BEING ACHIEVED:

Invest in the Growth and Evolution of the City's Economy Maintain the Current High Level of Public Safety
Operate in a Businesslike Manner
Focus Resources in Ontario's Commercial and Residential Neighborhoods Invest in the City's Infrastructure (Water, Streets, Sewers, Parks, Storm Drains and Public Facilities)
FISCAL IMPACT:

There is no direct ﬁscal impact associated with the receiving and ﬁling of this report.

BACKGROUND & ANALYSIS:

Each year, Staﬀ reviews the City's Platforms and makes updates based on current projects that impact the City. The proposed 2024 Legislative Platforms serves as the basis to engage in policy and legislative initiatives that will enable the City of Ontario to deliver projects and programs that meet the needs of it's residents. The document also guides Staﬀ recommendations to the City Council on state and federal legislative, regulatory, and administrative matters that are anticipated to be addressed in the upcoming year. The Staﬀ recommended changes are mostly minor, with an emphasis on removing redundancies and adding current policy guidance. The suggested updates are a result of collaboration between City departments.

Examples of 2024 priority issues are: housing funding, ﬁre medical dispatch, homelessness and goods movement. Staﬀ anticipates another robust year in Sacramento and Washington D.C. By adopting the updated platforms, Staﬀ and advocates can pursue policy and funding opportunities proactively. The City will continue to partner with public and private sector entities to support common objectives in and foster relationships within the region. 384
STATE

L E G I S L A T I V E

P L A T F O R M
CITY•OF•ONTARIO•202 4
385

ABOUT ONTARIO
Founded as a Model Colony, based on innovation, planned development, community service and family values, the City of Ontario has become the economic heart of the region. The City Council is committed to maintaining Ontario's leadership role in the Inland Empire by continuing to invest in the growth and evolution of the area's economy while providing a balance of jobs, housing, educational and recreational opportunities for our residents in a safe, well-maintained community.

Incorporated December 10, 1891, the City of Ontario covers an area of 50 miles within San Bernardino County. It is located 35 miles east of Los Angeles.

The primary objective of the Legislative Platform is to establish official City positions on clearly stated legislative issues at the start of the legislative year. The Legislative Platform is developed and maintained using the goals and objectives of the City Council, a review of legislative priorities from Cal Cities, the County of San Bernardino, Southern California Association of Governments (SCAG), and San Bernardino County Transportation Authority (SBCTA); input from City Staff, research of current law and pending legislation, as well as discussions with local legislative staff and the City’s legislative advocates.

State legislative proposals and policies consistent with the Legislative Platform may be supported by the City. Those policies or proposals inconsistent with this agenda may be opposed by the City. Generally, the City will not address matters that are not pertinent to the City’s local government services. The City may take positions such as Support or Oppose, or more nuanced positions such as “if amended” as a situation warrants but will not issue letters of concern without express City Council approval. 386

1. Local Control
a. Retain local control over all aspects of municipal land use. b. Oppose legislation seeking to reallocate revenue obtained from the Bradley-Burns Uniform Local Sales and Use Tax.
c. Oppose unfunded mandates.
d. Oppose legislation that would eliminate the tax exemption for municipal bonds.
e. Advocate for community lead priorities.

2. Economic Investment
a. Funding for “Smart Growth” and transit-oriented multimodal development.
b. Reinstate/reinstitute some form of practical tax increment financing. c. Funding for adaptive reuse and/or historic preservation. d. Funding for workforce development, veterans job opportunities, and job readiness.
e. Advocate for equitable funding for trade corridors, gateways, intermodal connectors, and freight facilities in the region.
f. Assist with additional revenue streams to support freight movement investment adequate to address the local and regional impacts of national freight flows.
g. Advocate for direct funding to local jurisdictions without unnecessary distribution though the State and County.

3. Public Safety
a. Invest in the security of the City and public safety officers. b. Invest in training and equipment for all first responders. c. Increase funding for disaster preparedness, prevention, recovery, and response for all-hazard threats.

4. Collaboration with Other Governmental Agencies
a. Regional homelessness program and mental health epidemic. b. Regional wastewater & recycled water services.
c. Support local authority to contract fire dispatch and medical services.

5. Commercial & Residential Neighborhoods
a. Support funding for Regional Housing Needs Assessment requirements. b. New funding for homelessness services and the construction of high- quality, fully serviced transitional housing facilities. c. Support reform of SCAQMD policies to mitigate negative impacts on the local and regional economy.
d. Explore cutting-edge freight conveyance systems for on and off-airport freight movement.
e. Allow local jurisdictions to plan affordable housing holistically. f. Encourage private investment in affordable housing.
387

6. Infrastructure
a. Investment in water, streets, sewers, parks, storm drains, and public facilities.
b. Support the reduction and dependence on imported water from the State Water Project.
c. Expand economic options for Ontario logistics projects/investments. d. Restore incremental tax funding options to cities, either as infrastructure finance districts, redevelopment agencies, or new funding programs. e. Oppose further restrictions on Surplus Land Act requirements. f. Oppose efforts to divert transportation infrastructure revenues for non- transportation purposes.

7. Quality of Life
a. Provide Care Act resources to San Bernardino County. b. Increase the private match for grade separations.
c. Support streamlined environmental revisions that remove duplication of state and federal processes.
d. Support increased funding for historic preservation and retrofit, and community centers.

8. Technology
a. Support efforts to expand municipal broadband and cooperation of service delivery with the private sector, such as OntarioNet. b. Support funding for wireless solutions and promote smart city options and high-quality broadband services.
c. Support cities who have invested local funding to broadband expansion efforts.
d. Advocate for funding towards zero emission municipal fleets.

Examples of High Priority Projects __
 Goods Movement
o Interstate 10/Grove Avenue Interchange
o SR-71/SR-91 Interchange Expansion
 Safety
o Euclid Corridor Rehabilitation
 Sustainability
o Alternate Water Supply Program
 Innovation
o OntarioNet
 Quality of Life
o Ontario Sports Complex
o Transit Oriented Development along Holt Blvd. Corridor o Ontario Grand Park
o Granada Theater Historic Renovation
388
Federal

L E G I S L A T I V E

P L A T F O R M
CITY•OF•ONTARIO•202 4
389

ABOUT ONTARIO
Founded as a Model Colony, based on innovation, planned development, community service and family values, the City of Ontario has become the economic heart of the region. The City Council is committed to maintaining Ontario's leadership role in the Inland Empire by continuing to invest in the growth and evolution of the area's economy while providing a balance of jobs, housing, and educational and recreational opportunities for our residents in a safe, well-maintained community.

Incorporated December 10, 1891, the City of Ontario covers an area of 50 miles within San Bernardino County. It is located 35 miles east of Los Angeles.

The primary objective of the Legislative Platform is to establish official City positions on clearly stated legislative issues at the start of the legislative year. The Legislative Platform is developed and maintained using the goals and objectives of the City Council, a review of legislative priorities from Cal Cities, County of San Bernardino, Southern California Association of Governments (SCAG), and San Bernardino County Transportation Authority (SBCTA), input from City Staff, research of current law and pending legislation, as well as discussions with local legislative staff and the City’s legislative advocates.

Federal legislative proposals and policies consistent with the Legislative Platform may be supported by the City. Those policies or proposals inconsistent with this agenda may be opposed by the City. Generally, the City will not address matters that are not pertinent to the City’s local government services. The City may take nuanced positions such as Support or Oppose “if amended” as a situation warrants but will not issue letters of concern without express City Council approval.
390

1. Economic Investment
a. Funding for “Smart Growth” and transit-oriented multimodal development.
b. Reinstate/reinstitute some form of practical tax increment financing. c. Funding for adaptive reuse and/or historic preservation. d. Funding for workforce development, veterans job opportunities, and job readiness.
e. Advocate for equitable funding for trade corridors, gateways, intermodal connectors, and freight facilities in the region.
f. Assist with additional revenue streams to support freight movement investment adequate to address the local and regional impacts of national freight flows.
g. Support strong funding for Community Development Block Grants. h. Advocate for funding to come to local jurisdictions without having to be distributed though the State and County level.

2. Infrastructure
a. Investment in water, streets, sewers, parks, storm drains, and public facilities.
b. Support the reduction and dependence on imported water from the State Water Project.
c. Expand economic options for Ontario Logistics Projects/Investments. d. Restore incremental tax funding options to cities, either as infrastructure finance districts, redevelopment agencies, or new funding programs.

3. Public Safety
a. Invest in training and equipment for all first responders. b. Increase funding for disaster preparedness, prevention, recovery, and response for all-hazard threats.

4. Collaboration with other Governmental Agencies
a. Regional homelessness program and mental health epidemic. b. Regional wastewater & recycled water services.

5. Local Control
a. Retain local control over all aspects of municipal land use. b. Oppose unfunded mandates.
c. Oppose legislation that would eliminate the tax exemption for municipal bonds.

6. Commercial & Residential Neighborhoods
a. Explore cutting-edge freight conveyance systems for on and off-airport freight movement.
b. Encourage private investment in affordable housing.
391

7. Quality of Life
a. Increase the private match for grade separations.
b. Support streamlined environmental revisions that remove duplication of state and federal processes.
c. Support increased funding for historic preservation and retrofit, and community centers.

8. Technology
a. Support efforts to expand municipal broadband and cooperation of service delivery with the private sector, such as OntarioNet. b. Support funding for wireless solutions and promote smart city options and high-quality broadband services.
c. Support cities who have invested local funding to broadband efforts. d. Advocate for funding towards zero emission municipal fleets.

Armen Harkalyan, Executive Director of Finance
Reviewed By: Cecilia House, . .

Approved By:

Submitted To: Council/OHA
Approved: _______________________________
Continued To: ___________________________
Denied: __________________________________
Item No: 18
SUBJECT:

A RESOLUTION AUTHORIZING THE ISSUANCE OF CITY OF ONTARIO COMMUNITY FACILITIES DISTRICT NO. 56 (PARKSIDE/LA AVENIDA) SPECIAL TAX BONDS, SERIES 2023 AND RELATED MATTERS

CITY OF ONTARIO
Agenda Report
November
7, 2023
SECTION:

ADMINISTRATIVE

REPORTS/DISCUSSION/ACTION

RECOMMENDATION:

That the City Council take the following actions:

A
.

Consider and adopt a Resolution authorizing the issuance of City of Ontario Community Facilities District No. 56 (Parkside/La Avenida) Special Tax Bonds, Series 2023 , in an aggregate
principal amount of not-to-exceed $21 million, authorizing the execution and delivery of an indenture, a bond purchase agreement, a continuing disclosure agreement, a ﬁrst amendment to acquisition and funding agreement, authorizing the distribution of an oﬃcial statement
and related actions;
B
.

Consider and adopt a Resolution of the City of Ontario making a declaration of oﬃcial intent to reimburse facilities expenditures with bond proceeds and related actions; C
.

Authorize the issuance of special tax bonds for public improvements required to facilitate the development of the Parkside/La Avenida project and the Ontario Ranch development; D
.

Approve the forms of the Indenture, the Bond Purchase Agreement, First Amendment to Acquisition and Funding Agreement; the Continuing Disclosure Agreement, and the Preliminary Official Statement;
E
.

Authorize a negotiated sale of the special tax bonds to Samuel A. Ramirez & Co., in accordance with the terms of the Bond Purchase Agreement; and F
.

Authorize the execution of the Indenture, the Bond Purchase Agreement, the Continuing Disclosure Agreement, a deemed ﬁnal certiﬁcation in connection with the Preliminary Oﬃcial Statement, a ﬁnal Oﬃcial Statement and other documents in connection with the issuance of the bonds by the City Manager or the other specified authorized officers.

THE FOLLOWING COUNCIL GOALS ARE BEING ACHIEVED:

Operate in a Businesslike Manner
Focus Resources in Ontario's Commercial and Residential Neighborhoods Invest in the City's Infrastructure (Water, Streets, Sewers, Parks, Storm Drains and Public Facilities)
393
Ensure the Development of a Well Planned, Balanced, and Self-Sustaining Community in Ontario Ranch
FISCAL IMPACT:

The use of Mello-Roos ﬁnancing for public facilities in the residential development of the Parkside/La Avenida project in the Ontario Ranch development, is estimated to generate approximately $21 million in bond proceeds based on current market interest rates. These funds will be used to help fund a portion of the public infrastructure improvements that will serve the project area. The Resolution authorizing the issuance of City of Ontario Community Facilities District No. 56 (Parkside/La Avenida) Special Tax Bonds, Series 2023, and related matters, limits the principal amount of the bonds to $21 million. The City currently expects the bonds to be sold no later than December 2023; however, such schedule could change based on market volatility and market conditions. Since Mello-Roos bonds are not a direct obligation of the City and are paid from special taxes levied on each taxable parcels in the applicable community facilities district, there is no impact to the General Fund from the issuance of Mello-Roos bonds. Annual approval by the City Council will be required to process the special tax levies necessary to fund the ongoing debt service obligations of Ontario Community Facilities District No. 56 (Parkside/La Avenida).

BACKGROUND & ANALYSIS:

The Mello-Roos Community Facilities Act of 1982 provides local government, with the requisite consent and approval from the property owners, the authority to establish community facilities districts for levying special taxes to fund governmental services and ﬁnance various kinds of public infrastructure facilities. Under the Mello-Roos Act, the initial steps in the formation of a community facilities district to ﬁnance public improvements are adopting a Resolution declaring the City's intention to establish a community facilities district and levy special taxes, a Resolution to issue bonds, and a Resolution of the City of Ontario making a declaration of oﬃcial intent to reimburse facilities expenditures with bond proceeds and related matters. On November 16, 2021 the City Council, in accordance with the Mello-Roos Act, took the initial steps in the formation of the District with the adoption of Resolution No. 2021-171, declaring the City's intention to establish the District and to authorize the levy of special taxes, and Resolution No. 2021-172 deeming it necessary for the District to incur bonded indebtedness. On December 21, 2021, the City Council adopted Resolution No. 2021-188 forming the District. Based on a successful property owner election held on December 21, 2021, the City Council adopted Ordinance No. 3199 on January 18, 2022, authorizing the levy of special taxes within the District to ﬁnance public improvements related to the Parkside/La Avenida project.

The public improvements to be financed by the District are as follows:

Storm Drain System Facilities;
Fiber Optic System Facilities; and
Streets and Traffic Circulation System Facilities.

The Parkside/La Avenida project addresses the residential development of approximately 50.84 gross acres that consists of three special tax zones: Zone 1 - Woodside Homes; Zone 2 - The New Home Company; and Zone 3 - PA27/Lennar Homes.

Location of the project areas are: Zone 1-
Woodside Homes south of Schaefer Avenue, generally east of Archibald Avenue, west of Turner Avenue and north of La Avenida Drive; Zone 2 - New Home Company generally south of Edison Avenue, east of Cucamonga Creek Channel, west of Archibald Avenue, and north of Eucalyptus 394
Avenue; and Zone 3 - PA27/Lennar Homes south of Merrill Avenue generally west of Haven Avenue, generally east of Archibald Avenue and north of the County Line Channel .

At build out, the project
is projected to include 482 residential units: Zone 1- 106 detached-condo units; Zone 2 - 303 detached-condo units; and Zone 3 - 52 detached-condo units, and 21 attached units.

The proposed Resolutions references several bond documents and other matters related to the proposed issuance of bonds by City of Ontario Community Facilities District No. 56 (Parkside/La Avenida). The documents are listed below and are on ﬁle with the Records Management Department:

Indenture;
Bond Purchase Agreement;
First Amendment to Acquisition and Funding Agreement;
Continuing Disclosure Agreement; and
Preliminary Official Statement.
395
RESOLUTION NO. ________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ONTARIO,

CALIFORNIA, AUTHORIZING THE ISSUANCE OF CITY OF ONTARIO COMMUNITY FACILITIES DISTRICT NO. 56 (PARKSIDE/LA AVENIDA) SPECIAL TAX BONDS, SERIES 2023, IN AN AGGREGATE PRINCIPAL AMOUNT OF NOT TO EXCEED $21,000,000, AUTHORIZING THE

EXECUTION AND DELIVERY OF AN INDENTURE, A BOND PURCHASE

AGREEMENT, A CONTINUING DISCLOSURE AGREEMENT AND A

FIRST AMENDMENT TO ACQUISITION AND FUNDING AGREEMENT,

AUTHORIZING THE DISTRIBUTION OF AN OFFICIAL STATEMENT IN

CONNECTION THEREWITH AND AUTHORIZING THE EXECUTION OF

NECESSARY DOCUMENTS AND CERTIFICATES AND RELATED
ACTIONS.

WHEREAS, the City Council (the “City Council”) of the City of Ontario (the “City”) has formed City of Ontario Community Facilities District No. 56 (Parkside/La Avenida) (the “Community Facilities District”) under the provisions of the Mello-Roos Community Facilities Act of 1982 (the “Act”); and
WHEREAS, the Community Facilities District is authorized under the Act to levy a special tax (the “Special Tax”) to pay for the costs of certain public facilities (the “Facilities”) and to issue bonds payable from the Special Tax; and WHEREAS, in order to provide funds to finance certain of the Facilities, the Community Facilities District proposes to issue its City of Ontario Community Facilities District No. 56 (Parkside/La Avenida) Special Tax Bonds, Series 2023 (the “Series 2023 Bonds”), in the aggregate principal amount of not to exceed $21,000,000; and WHEREAS, in order to provide for the authentication and delivery of the Series 2023 Bonds, to establish and declare the terms and conditions upon which the Series 2023 Bonds are to be issued and secured and to secure the payment of the principal thereof, premium, if any, and interest thereon, the Community Facilities District proposes to enter into an Indenture with Zions Bancorporation, National Association, as trustee (the “Trustee”) (such Indenture, in the form presented to this meeting, with such changes, insertions and omissions as are made pursuant to this Resolution, being referred to herein as the “Indenture”); and
WHEREAS, Samuel A. Ramirez & Co., Inc. (the “Underwriter”), has presented the Community Facilities District with a proposal, in the form of a Bond Purchase Agreement, to purchase the Series 2023 Bonds from the Community Facilities District (such Bond Purchase Agreement, in the form presented to this meeting, with such changes, insertions and omissions as are made pursuant to this Resolution, being referred to herein as the “Purchase Agreement”); and
396
WHEREAS, Rule 15c2-12 promulgated under the Securities Exchange Act of 1934 (“Rule 15c2-12”) requires that, in order to be able to purchase or sell the Series 2023 Bonds, the underwriter thereof must have reasonably determined that the Community Facilities District, as the issuer of the Series 2023 Bonds, has undertaken in a written agreement or contract for the benefit of the holders of the Series 2023 Bonds to provide disclosure of certain financial information and certain listed events on an ongoing basis; and WHEREAS, in order to cause such requirement to be satisfied, the Community Facilities District desires to enter into a Continuing Disclosure Agreement with the Trustee (such Continuing Disclosure Agreement, in the form presented to this meeting, with such changes, insertions and omissions as are made pursuant to this Resolution, being referred to herein as the “Continuing Disclosure Agreement”); and WHEREAS, a form of the Preliminary Official Statement to be distributed in connection with the public offering of the Series 2023 Bonds has been prepared (such Preliminary Official Statement, in the form presented to this meeting, with such changes, insertions and omissions as are made pursuant to this Resolution, being referred to herein as the “Preliminary Official Statement”); and
WHEREAS, the City and SC Ontario Development Company, LLC (the “Developer”) previously entered into the Acquisition and Funding Agreement, dated as of December 1, 2021 (the “Original Acquisition Agreement”), pursuant to which, in accordance with the terms set forth therein, the Developer is to construct or cause to be constructed certain of the Facilities that, upon satisfaction of the conditions specified therein, the City is to acquire and take title to, and the Developer is to be paid the purchase price of, determined as set forth therein, which purchase price is to be paid from the proceeds of the special tax or bonds of the Community Facilities District; and WHEREAS, the Original Acquisition Agreement provides that the Original Acquisition Agreement may be amended by an instrument in writing executed and delivered by the City and the Developer; and
WHEREAS, the City and the Developer desire to amend the Original Acquisition Agreement in order to amend the Acquisition Cost (as defined in the Original Acquisition Agreement) of certain of the segments of the Facilities set forth in the Original Acquisition Agreement; and
WHEREAS, there has been presented to this meeting a form of a First Amendment to Acquisition and Funding Agreement that so amends the Original Acquisition Agreement (such First Amendment to Acquisition and Funding Agreement, in the form presented to this meeting, with such changes, insertions and omissions as are made pursuant to this Resolution, being referred to herein as the “First Amendment”); and WHEREAS, there have been prepared and submitted to this meeting forms of:
(a) the Indenture;
(b) the Purchase Agreement;
(c) the Continuing Disclosure Agreement;
397
(d) the Preliminary Official Statement; and
(e) The First Amendment;
WHEREAS, Kitty Siino & Associates, Inc. has prepared and provided to the Community Facilities District an appraisal report, dated October 4, 2023 (the “Appraisal”), providing an opinion of value of the property in the Community Facilities District, which has been submitted to this meeting; and
WHEREAS, Section 5852.1 of the California Government Code requires that the City Council obtain from an underwriter, financial advisor or private lender and disclose, in a meeting open to the public, prior to authorization of the issuance of the Series 2023 Bonds, good faith estimates of (a) the true interest cost of the Series 2023 Bonds, (b) the sum of all fees and charges paid to third parties with respect to the Series 2023 Bonds, (c) the amount of proceeds of the Series 2023 Bonds expected to be received net of the fees and charges paid to third parties and any reserves or capitalized interest paid or funded with proceeds of the Series 2023 Bonds, and (d) the sum total of all debt service payments on the Series 2023 Bonds calculated to the final maturity of the Series 2023 Bonds plus the fees and charges paid to third parties not paid with the proceeds of the Series 2023 Bonds; and
WHEREAS, in compliance with Section 5852.1 of the California Government Code, the City Council has obtained from CSG Advisors Incorporated, as the Community Facilities District’s municipal advisor (the “Municipal Advisor,”), the required good faith estimates, which the Municipal Advisor has prepared in consultation with the Underwriter, and such estimates are disclosed and set forth in Exhibit A attached hereto; and WHEREAS, the Community Facilities District desires to proceed to issue and sell the Series 2023 Bonds and to authorize the execution of such documents and the performance of such acts as may be necessary or desirable to effect the offering, sale and issuance of the Series 2023 Bonds; and
WHEREAS, the City Council is the legislative body of the Community Facilities District;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Ontario as follows:

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

SECTION 2. Subject to the provisions of Section 3 hereof, the issuance of the Series 2023 Bonds, in an aggregate principal amount of not to exceed $21,000,000, on the terms and conditions set forth in, and subject to the limitations specified in, the Indenture, be and the same is hereby authorized and approved. The Series 2023 Bonds shall be dated, shall bear interest at the rates, shall mature on the dates, shall be subject to call and redemption, shall be issued in the form and shall be as otherwise provided in the Indenture, as the same shall be completed as provided in this Resolution. 398
SECTION 3. The Indenture, in substantially the form submitted to this meeting and made a part hereof as though set forth herein, be and the same is hereby approved.

Each of the Mayor of the City, and such other member of the City Council as the Mayor may designate, the City Manager of the City, the Assistant City Manager of the City, the Executive Director of Finance of the City, the Deputy City Treasurer of the City, and such other officer or employee of the City as the City Manager may designate (the “Authorized Officers”) is hereby authorized, and any one of the Authorized Officers is hereby directed, for and in the name of the Community Facilities District, to execute and deliver the Indenture in the form submitted to this meeting, with such changes, insertions and omissions as the Authorized Officer executing the same may require or approve, such requirement or approval to be conclusively evidenced by the execution of the Indenture by such Authorized Officer; provided, however, that such changes, insertions and omissions shall not authorize an aggregate principal amount of Series 2023 Bonds in excess of $21,000,000, shall not result in a final maturity date of the Series 2023 Bonds later than September 1, 2055, and shall not result in a true interest cost for the Series 2023 Bonds in excess of 7.00%.

SECTION 4. The Purchase Agreement, in substantially the form submitted to this meeting and made a part hereof as though set forth in full herein, be and the same is hereby approved. Each of the Authorized Officers is hereby authorized, and any one of the Authorized Officers is hereby directed, for and in the name of the Community Facilities District, to execute and deliver the Purchase Agreement in the form presented to this meeting, with such changes, insertions and omissions as the Authorized Officer executing the same may require or approve, such requirement or approval to be conclusively evidenced by the execution of the Purchase Agreement by such Authorized Officer; provided, however, that such changes, insertions and omissions shall not result in an aggregate underwriter’s discount (not including any original issue discount) from the principal amount of the Series 2023 Bonds in excess of 1.50% of the aggregate principal amount of the Series 2023 Bonds. The City Council hereby finds and determines that the sale of the Series 2023 Bonds at negotiated sale as contemplated by the Purchase Agreement will result in a lower overall cost.

SECTION 5. The Continuing Disclosure Agreement, in substantially the form submitted to this meeting and made a part hereof as though set forth in full herein, be and the same is hereby approved. Each of the Authorized Officers is hereby authorized, and any one of the Authorized Officers is hereby directed, for and in the name of the Community Facilities District, to execute and deliver the Continuing Disclosure Agreement in the form presented to this meeting, with such changes, insertions and omissions as the Authorized Officer executing the same may require or approve, such requirement or approval to be conclusively evidenced by the execution of the Continuing Disclosure Agreement by such Authorized Officer.

SECTION 6. The Preliminary Official Statement, in substantially the form presented to this meeting and made a part hereof as though set forth in full herein, with such changes, insertions and omissions therein as may be approved by an Authorized Officer, be and the same is hereby approved, and the use of the Preliminary Official Statement in connection with the offering and sale of the Series 2023 Bonds is hereby authorized and approved. Each of the Authorized Officers is hereby authorized, and any 399
one of the Authorized Officers is hereby directed, to certify on behalf of the Community Facilities District that the Preliminary Official Statement is deemed final as of its date, within the meaning of Rule 15c2-12 (except for the omission of certain final pricing, rating and related information as permitted by Rule 15c2-12).

SECTION 7. The preparation and delivery of a final Official Statement (the “Official Statement”), and its use in connection with the offering and sale of the Series 2023 Bonds, be and the same is hereby authorized and approved. The Official Statement shall be in substantially the form of the Preliminary Official Statement, with such changes, insertions and omissions as may be approved by an Authorized Officer, such approval to be conclusively evidenced by the execution and delivery thereof. Each of the Authorized Officers is hereby authorized, and any one of the Authorized Officers is hereby directed, for and in the name of the Community Facilities District, to execute the final Official Statement and any amendment or supplement thereto.

SECTION 8. The First Amendment, in substantially the form submitted to this meeting and made a part hereof as though set forth in full herein, be and the same is hereby approved. Each of the Authorized Officers is hereby authorized, and any one of the Authorized Officers is hereby directed, for and in the name of the City, to execute and deliver the First Amendment in the form presented to this meeting, with such changes, insertions and omissions as the Authorized Officer executing the same may require or approve, such requirement or approval to be conclusively evidenced by the execution of the First Amendment by such Authorized Officer.

SECTION 9. Based upon the value of the property within the Community Facilities District reported in the Appraisal and the value-to-lien information for such property set forth in the Preliminary Official Statement, the City Council, for purposes of Section 53345.8 of the Act, hereby finds and determines that the value of the real property that would be subject to the Special Tax to pay debt service on the Series 2023 Bonds will be at least three times the principal amount of the Series 2023 Bonds to be sold and the principal amount of all other bonds outstanding that are secured by a special tax levied pursuant to the Act on property within the Community Facilities District or a special assessment levied on property within the Community Facilities District.

SECTION 10. If and to the extent that any feature or aspect of the Series 2023 Bond structure, the rate and method of apportionment of the Special Tax, the method of financing the Facilities, the appraisal, the absorption study or other components of the Series 2023 Bond issue approved and authorized hereby is inconsistent or in conflict with any requirement, standard, measure or procedure set forth in the City’s Mello-Roos Community Facilities Act of 1982 Local Goals and Policies, such requirement, standard, measure or procedure is, to the extent necessary to eliminate such inconsistency or conflict, hereby waived, and the City Council hereby finds and determines that benefit inures to the ultimate property owners, the Community Facilities District and/or the City as a result of such waiver.
400
SECTION 11. The City Council hereby approves the execution and delivery of all agreements, documents, certificates and instruments referred to herein with electronic signatures as may be permitted under the California Uniform Electronic Transactions Act and digital signatures as may be permitted under Section 16.5 of the California Government Code using DocuSign.

SECTION 12. All actions heretofore taken by the officers, employees and agents of the City with respect to the issuance and sale of the Series 2023 Bonds, or in connection with or related to any of the agreements, documents, certificates or instruments referred to herein, are hereby approved, confirmed and ratified.

SECTION 13. The Authorized Officers and the officers, employees and agents of the City are, and each of them is, hereby authorized and directed, for and in the name of the Community Facilities District to take all actions and do any and all things and to execute and deliver any and all agreements, documents, certificates or instruments that they, or any of them, may deem necessary or advisable in order to consummate the transactions contemplated by this Resolution and otherwise to carry out, give effect to and comply with the terms and intent of this Resolution not inconsistent with the provisions hereof.

SECTION 14. This Resolution shall take effect immediately upon its adoption.

The City Clerk of the City of Ontario shall certify as to the adoption of this Resolution.

PASSED, APPROVED, AND ADOPTED this 7th day of November 2023. _____________________________________
PAUL S. LEON, MAYOR
ATTEST:
____________________________________

SHEILA MAUTZ, CITY CLERK
APPROVED AS TO FORM:
____________________________________

BEST BEST & KRIEGER LLP

CITY ATTORNEY
401

STATE OF CALIFORNIA )

COUNTY OF SAN BERNARDINO )

AYES: COUNCIL MEMBERS:

NOES: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:
____________________________________

SHEILA MAUTZ, CITY CLERK
(SEAL)
402

EXHIBIT A

GOOD FAITH ESTIMATES
The good faith estimates set forth herein are provided with respect to the Series 2023 Bonds in accordance with Section 5852.1 of the California Government Code. Such good faith estimates have been provided to the Community Facilities District by the Municipal Advisor, which the Municipal Advisor has prepared in consultation with Samuel A. Ramirez & Co., Inc., the Underwriter.

Principal Amount. The Municipal Advisor has informed the Community Facilities District that, based on the Community Facilities District’s financing plan and current market conditions, its good faith estimate of the aggregate principal amount of the Series 2023 Bonds to be issued and sold is $19,435,000 (the “Estimated Principal Amount”), which does not include approximately $277,000 of net original issue discount estimated to be generated based on current market conditions. Net original issue discount is generated when, on a net aggregate basis for a single issuance of bonds, the price paid for such bonds is lower than the face value of such bonds. Such Estimated Principal Amount and such estimated net original issue discount amount would produce approximately $19,158,000 of gross proceeds.

True Interest Cost of the Series 2023 Bonds. The Municipal Advisor has informed the Community Facilities District that, assuming that the Estimated Principal Amount of the Series 2023 Bonds is issued and sold, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the true interest cost of the Series 2023 Bonds, which means the rate necessary to discount the amounts payable on the respective principal and interest payment dates to the purchase price received for the Series 2023 Bonds, is 5.71%.

Finance Charge of the Series 2023 Bonds . The Municipal Advisor has informed the Community Facilities District that, assuming that the Estimated Principal Amount of the Series 2023 Bonds is issued and sold, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the finance charge for the Series 2023 Bonds, which means the sum of all fees and charges paid to third parties (or costs associated with the Series 2023 Bonds), is $591,000.

Amount of Proceeds to be Received . The Municipal Advisor has informed the Community Facilities District that, assuming that the Estimated Principal Amount of the Series 2023 Bonds is issued and sold, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the amount of proceeds expected to be received by the Community Facilities District for sale of the Series 2023 Bonds, less the finance charge of the Series 2023 Bonds, as estimated above, and any reserves or capitalized interest paid or funded with proceeds of the Series 2023 Bonds, is $17,254,000.

Total Payment Amount . The Municipal Advisor has informed the Community Facilities District that, assuming that the Estimated Principal Amount of the Series 2023 Bonds is issued and sold, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the total payment amount, which 403
means the sum total of all payments the Community Facilities District will make to pay debt service on the Series 2023 Bonds, plus the finance charge for the Series 2023 Bonds, as described above, not paid with the proceeds of the Series 2023 Bonds, calculated to the final maturity of the Series 2023 Bonds, is $40,321,000, which excludes any reserves (or interest accrued thereon) or capitalized interest funded or paid with proceeds of the Series 2023 Bonds (which may offset such total payment amount).

The foregoing estimates constitute good faith estimates only and are based on market conditions prevailing at the time of preparation of such estimates. The actual principal amount of the Series 2023 Bonds issued and sold, the true interest cost thereof, the finance charges thereof, the amount of proceeds received therefrom and total payment amount with respect thereto may differ from such good faith estimates due to (a) the actual date of the sale of the Series 2023 Bonds being different than the date assumed for purposes of such estimates, (b) the actual principal amount of Series 2023 Bonds issued and sold being different from the Estimated Principal Amount, (c) the actual amortization of the Series 2023 Bonds being different than the amortization assumed for purposes of such estimates, (d) the actual market interest rates at the time of sale of the Series 2023 Bonds being different than those estimated for purposes of such estimates, (e) other market conditions, or (f) alterations in the Community Facilities District’s financing plan, or a combination of such factors. The actual date of sale of the Series 2023 Bonds and the actual principal amount of Series 2023 Bonds issued and sold will be determined by the Community Facilities District based on the timing of the need for proceeds of the Series 2023 Bonds and other factors. The actual interest rates borne by the Series 2023 Bonds will depend on market interest rates at the time of sale thereof.

The actual amortization of the Series 2023 Bonds will also depend, in part, on market interest rates at the time of sale thereof. Market interest rates are affected by economic and other factors beyond the control of the Community Facilities District. 404
RESOLUTION NO. ________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ONTARIO,

CALIFORNIA, MAKING A DECLARATION OF OFFICIAL INTENT TO

REIMBURSE FACILITIES EXPENDITURES WITH BOND PROCEEDS
AND RELATED ACTIONS.

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

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

SECTION 2. This Resolution is adopted by the City Council solely for purposes of establishing compliance with the requirements of Section 1.150-2 of the Treasury Regulations. Unless otherwise defined, terms used herein shall have the meaning set forth in the Internal Revenue Code of 1986 and in Section 1.150-2 of the Treasury Regulations. This Resolution does not bind the City to make any expenditure, incur any indebtedness, or proceed with construction of the Facilities.

SECTION 3. All actions heretofore taken by the officers, employees and agents of the City with respect to the actions set forth above are hereby approved, confirmed and ratified.

SECTION 4. The officers, employees and agents of the City are, and each of them is, hereby authorized and directed, for and in the name of the Community Facilities District to take all actions and do any and all things that they, or any of them, may deem necessary or advisable in order to consummate the transactions contemplated by this Resolution and otherwise to carry out, give effect to and comply with the terms and intent of this Resolution not inconsistent with the provisions hereof.

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

The City Clerk of the City of Ontario shall certify as to the adoption of this Resolution.

PASSED, APPROVED, AND ADOPTED this 7th day of November 2023. _____________________________________
PAUL S. LEON, MAYOR
ATTEST:
____________________________________

SHEILA MAUTZ, CITY CLERK
406
APPROVED AS TO FORM:
____________________________________

BEST BEST & KRIEGER LLP

CITY ATTORNEY
407

STATE OF CALIFORNIA )

COUNTY OF SAN BERNARDINO )

AYES: COUNCIL MEMBERS:

NOES: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:
____________________________________

SHEILA MAUTZ, CITY CLERK
(SEAL)
408

4140-7971-6425.3

INDENTURE

by and between

CITY OF ONTARIO
COMMUNITY FACILITIES DISTRICT NO. 56
(PARKSIDE/LA AVENIDA)

and

ZIONS BANCORPORATION, NATIONAL ASSOCIATION,

AS TRUSTEE

Dated as of __________ 1, 2023

Relating to
City of Ontario
Community Facilities District No. 56
(Parkside/La Avenida)
Special Tax Bonds

409

TABLE OF CONTENTS
Page

i
4140-7971-6425.3

ARTICLE I
DEFINITIONS; RULES OF CONSTRUCTION; EQUAL SECURITY
Section 1.01. Definitions................................................................................................................ 3 Section 1.02. Rules of Construction ............................................................................................ 11 Section 1.03. Equal Security ........................................................................................................ 12

ARTICLE II

THE BONDS
Section 2.01. Authorization of Bonds; Special, Limited Obligations .......................................... 13 Section 2.02. Terms of Series 2023 Bonds .................................................................................. 13 Section 2.03. Execution of Bonds ................................................................................................ 14 Section 2.04. Authentication of Bonds ........................................................................................ 15 Section 2.05. Registration Books ................................................................................................. 15 Section 2.06. Transfer and Exchange of Bonds ........................................................................... 15 Section 2.07. Book-Entry System ................................................................................................ 15 Section 2.08. Bonds Mutilated, Lost, Destroyed or Stolen .......................................................... 18 Section 2.09. Temporary Bonds................................................................................................... 18

ARTICLE III
ISSUANCE OF SERIES 2023 BONDS; APPLICATION OF PROCEEDS; ADDITIONAL BONDS
Section 3.01. Issuance of Series 2023 Bonds .............................................................................. 19 Section 3.02. Application of Proceeds ......................................................................................... 19 Section 3.03. Costs of Issuance Fund .......................................................................................... 20 Section 3.04. Improvement Fund ................................................................................................. 20 Section 3.05. Conditions for the Issuance of Additional Bonds .................................................. 28 Section 3.06. Procedure for the Issuance of Additional Bonds ................................................... 30 Section 3.07. Additional Bonds ................................................................................................... 31

ARTICLE IV

REDEMPTION OF BONDS
Section 4.01. Redemption of Series 2023 Bonds ......................................................................... 32 Section 4.02. Notice of Redemption ............................................................................................ 34 Section 4.03. Selection of Bonds for Redemption ....................................................................... 34 Section 4.04. Partial Redemption of Bonds ................................................................................. 35 410

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4140-7971-6425.3

Section 4.05. Effect of Notice of Redemption ............................................................................. 35

ARTICLE V
SECURITY FOR BONDS; FLOW OF FUNDS; INVESTMENTS
Section 5.01. Pledge ..................................................................................................................... 36 Section 5.02. Special Tax Fund ................................................................................................... 36 Section 5.03. Bond Fund .............................................................................................................. 37 Section 5.04. Reserve Fund ......................................................................................................... 38 Section 5.05. Redemption Fund ................................................................................................... 39 Section 5.06. Rebate Fund ........................................................................................................... 39 Section 5.07. Administrative Expense Fund ................................................................................ 39 Section 5.08. Investment of Moneys............................................................................................ 40

ARTICLE VI

COVENANTS
Section 6.01. Collection of Special Tax Revenues ...................................................................... 42 Section 6.02. Foreclosure ............................................................................................................. 42 Section 6.03. Compliance with Act ............................................................................................. 43 Section 6.04. Punctual Payment................................................................................................... 43 Section 6.05. Extension of Payment of Bonds ............................................................................. 43 Section 6.06. Against Encumbrances; Defense of Pledge ........................................................... 43 Section 6.07. Tax Covenants ....................................................................................................... 43 Section 6.08. Non-Cash Payments of Special Tax ...................................................................... 44 Section 6.09. Reduction in Special Tax ....................................................................................... 44 Section 6.10. Continuing Disclosure ........................................................................................... 44 Section 6.11. Accounting Records ............................................................................................... 44 Section 6.12. State Reporting....................................................................................................... 44 Section 6.13. Annual Reports to the California Debt and Investment Advisory Commission ................................................................................................... 45 Section 6.14. Further Assurances ................................................................................................. 45

ARTICLE VII

EVENTS OF DEFAULT AND REMEDIES
Section 7.01. Events of Default ................................................................................................... 46 Section 7.02. Foreclosure ............................................................................................................. 46 411

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4140-7971-6425.3

Section 7.03. Other Remedies ...................................................................................................... 46 Section 7.04. Remedies Not Exclusive ........................................................................................ 47 Section 7.05. Application of Net Special Tax Revenues After Default ....................................... 47 Section 7.06. Power of Trustee to Enforce .................................................................................. 48 Section 7.07. Owners’ Direction of Proceedings ......................................................................... 48 Section 7.08. Limitation on Owners’ Right to Sue ...................................................................... 48 Section 7.09. Absolute Obligation ............................................................................................... 48 Section 7.10. Termination of Proceedings ................................................................................... 49 Section 7.11. No Waiver of Default ............................................................................................. 49

ARTICLE VIII

TRUSTEE
Section 8.01. Duties and Liabilities of Trustee ............................................................................ 50 Section 8.02. Qualifications; Removal and Resignation; Successors .......................................... 50 Section 8.03. Liability of Trustee ................................................................................................ 51 Section 8.04. Right to Rely on Documents and Opinions ........................................................... 53 Section 8.05. Accounting Records and Financial Statements...................................................... 54 Section 8.06. Preservation and Inspection of Documents............................................................ 54 Section 8.07. Compensation and Indemnification ....................................................................... 54

ARTICLE IX

SUPPLEMENTAL INDENTURES
Section 9.01. Supplemental Indentures ........................................................................................ 56 Section 9.02. Effect of Supplemental Indenture .......................................................................... 57 Section 9.03. Endorsement of Bonds; Preparation of New Bonds .............................................. 57 Section 9.04. Amendment of Particular Bonds ............................................................................ 57

ARTICLE X

DEFEASANCE
Section 10.01. Discharge of Indenture ......................................................................................... 58 Section 10.02. Bonds Deemed To Have Been Paid ..................................................................... 58 Section 10.03. Unclaimed Moneys .............................................................................................. 59

ARTICLE XI

MISCELLANEOUS
Section 11.01. Successor Is Deemed Included in All References to Predecessor ....................... 60 412

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4140-7971-6425.3

Section 11.02. Limitation of Rights ............................................................................................. 60 Section 11.03. Destruction of Bonds ........................................................................................... 60 Section 11.04. Severability of Invalid Provisions ........................................................................ 60 Section 11.05. Notices ................................................................................................................. 60 Section 11.06. Evidence of Rights of Owners ............................................................................. 61 Section 11.07. Disqualified Bonds............................................................................................... 62 Section 11.08. Money Held for Particular Bonds ........................................................................ 62 Section 11.09. Funds and Accounts ............................................................................................. 62 Section 11.10. Business Days ...................................................................................................... 62 Section 11.11. Waiver of Personal Liability ................................................................................ 62 Section 11.12. Conflict with Act.................................................................................................. 63 Section 11.13. Conclusive Evidence of Regularity ..................................................................... 63 Section 11.14. Governing Laws ................................................................................................... 63 Section 11.15. Electronic Signature ............................................................................................. 63 Section 11.16. Execution in Several Counterparts ....................................................................... 63 EXHIBIT A PERMITTED INVESTMENTS .......................................................................... A-1 EXHIBIT B FORM OF SERIES 2023 BOND ......................................................................... B-1

413

4140-7971-6425.3

INDENTURE

THIS INDENTURE (this “Indenture”), dated as of __________ 1, 2023, is by and between CITY OF ONTARIO COMMUNITY FACILITIES DISTRICT NO. 56 (PARKSIDE/LA AVENIDA), a c ommunity facilities district organized and existing under the laws of the State of California (the “Community Facilities District”), and ZIONS BANCORPORATION, NATIONAL ASSOCIATION, a national banking association organized and existing under the laws of the United States of America, as trustee (the “Trustee”).

W I T N E S S E T H:

WHEREAS, the City Council of the City of Ontario has formed the Community Facilities District under the provisions of the Mello-Roos Community Facilities Act of 1982 (the “Act”); WHEREAS, the Community Facilities District is authorized under the Act to levy a special tax (the “Special Tax”) to pay for the costs of certain public facilities (the “Facilities”) and to issue bonds payable from the Special Tax;
WHEREAS, in order to provide funds to finance a portion of the Facilities, the Community Facilities District desires to provide for the issuance of its City of Ontario Community Facilities District No. 56 (Parkside/La Avenida) Special Tax Bonds, Series 2023 (the “Series 2023 Bonds”), in the aggregate principal amount of not to exceed $_________; WHEREAS, the Community Facilities District desires to provide for the issuance of additional bonds (the “Additional Bonds”) payable from the Special Tax on a parity with the Series 2023 Bonds, provided that said issuance is in accordance with the Act and this Indenture (the Series 2023 Bonds and any such Additional Bonds being collectively referred to as the “Bonds”); WHEREAS, in order to provid e f or the authentication a nd delivery of the Bonds, to establish and declare the terms and conditions upon which the Bonds are to be issued and secured and to secure the payment of the principal thereof, premium, if any, and interest there on, the Community Facilities District has authorized the execution and delivery of this Indenture; and WHEREAS, the Community Facilities District has determined that all acts and proceedings required by law necessary to make the Bonds, when executed by the Community Facilities District, authenticated and delivered by the Trustee and duly issued, the val id, binding and legal special, limited obligations of the Community Facilities District, and to constitute this Indenture a valid and binding agreement for the uses and purposes herein set forth in accordance with its terms, have been done and taken, and t he execution and d elivery of this In denture ha s been in all respects duly authorized;
NOW, THEREFORE, THIS INDENTURE WITNESSETH, that in order to secure the payment of the principal of, premium, if any, and the interest on all Bonds at any time issued and outstanding u nder this Indenture, ac cording to their tenor, and to secure the performance and observance of all the covenants and conditions therein and herein set forth, and to declare the terms and conditions upon and subject to w hich the Bonds are to be issued, and in consideration of the premises and of the mutual covenants herein contained and of the purchase and acceptance of the Bonds by the owners thereof, and for other valuable consideration, the receipt whereof is hereby 414

2 4140-7971-6425.3

acknowledged, the Community Facilities District does hereby covenant and agree with the Trustee, for the benefit of the respective owners from time to time of the Bonds, as follows:
415

3 4140-7971-6425.3

ARTICLE I

DEFINITIONS; RULES OF CONSTRUCTION; EQUAL SECURITY
Section 1.01. Definitions. Unless the context otherwise r equires, t he terms defined in this S ection s hall for al l pur poses of this In denture and of any certificate, opinion or other document herein or therein mentioned, have the meanings herein specified. “Accounts” means the accounts from time to time established pursuant t o this Indenture in any of the Funds established and maintained by the Trustee pursuant hereto. “Act” means the Mello -Roos Community Facilities Act of 19 82, consti tuting S ections 53311 et seq. of the California Government Code.
“Additional Bonds” means Bon ds other than Series 2023 Bonds issued hereunder in accordance with the provisions of Sections 3.05 and 3.06. “Administrative Expense Fund” means the Fund by that name established and held by the Trustee pursuant to Section 5.07.
“Administrative Expenses” means any reasonably necessary or appropriate expenses incurred in the administration of the Community Facilities District and the Bonds, including (a) the administrative and legal costs of levying and collecting the Special Tax (including costs incurred in connection with any appeals relating thereto and litigation expenses incurred in connection with the collection of such Special Tax), (b) the fees, costs and indemnifications due the Trustee, (c) the costs incurred with on -going disclosure in connection with the Bonds, ( d) the costs incurred in connection with the disclosure of the Special Tax to property owners and potential purchasers of property, (e) the amounts required to calculate and pay arbitrage rebate payments to the federal government, and (f) an allocable share of the salaries of the City staff providing services on behalf of the Community Facilities District directly related to the foregoing and an allocable share of City general administrative overhead related thereto.
“Affiliate” of another Person means (a) each Per son that, directly or indirectly, owns or controls, whether beneficially or as trustee, guardian, or other fiduciary, 50% or more of any class of equity securities of such other Person, and (b) each Person that controls, is controlled by or is under common control with or by such Person or any Affiliate of such Person. For the purpose of this definition, “control” of a Person shall mean the possession, directly or indirectly, of the power to direct or cause the direction of its management or policies, whether through the ownership of voting securities, by contract or otherwise.
“Annual Debt Service” means, for each Bond Year, the sum of (a) the interest due on the Outstanding Bonds in such Bond Ye ar, assuming that the Outstan ding B onds are retir ed as scheduled (including by reason of mandatory sinking fund redemptions), and (b) the principal of the Outstanding Bonds due in such Bon d Year (including by reas on of ma ndatory s inking fund redemptions).
“Appraised Value” means the value of all or any portion of the Taxable Property, as set forth in a Qualified Appraisal Report prepared by a Qualified Appraiser. 416

4 4140-7971-6425.3

“Assessed Value” means, with respect to all or any portion of the Taxable Property, as of any date, the assessed value thereof, as such value is shown on the most recently equalized assessment roll.
“Assigned Special Tax” has the meaning ascribed to the term “Assigned Special Tax A” in the Rate and Method.
“Authorized Denominations” means (a) with respect to the Series 2023 Bonds, $5,000 and any integral multiple thereof, and (b) with respect to each Series of Additional Bonds, the authorized denominations for such Series o f Additio nal Bonds specifie d in the Supplemental Indenture pursuant to which such Additional Bonds are issued. “Authorized Representative” means, with respect to the Community Facilities District, the Mayor of the City, the City Manager of the City , the As sistant City Manager of the City, the Executive Director of Finance of the City and the Deputy City Treasurer of the City, and any other Person designated as an Au thorized Representative of t he Community Facilities District in a Written Certificate of the Community Facilities District submitted to the Trustee. “Available Special Tax” means, for any Fiscal Year, the s um of (a) the amount of the Assigned Special Tax that may be levied for such Fiscal Year, pursuant to the Rate and Method and the Act, on all Developed P roperty, plus (b) the amount of the Maximum Special Tax that may be levied for such Fiscal Year, pursuant to the Rate and Method and the Act, on all Taxable Property that is not Developed Property, less (c) the Projected Administrative Expenses for such Fiscal Year.
“Average Annual Debt Service” means the average of the Annual Debt Service for all Bond Years, including the Bond Year in which the calculation is made. “Beneficial Owners” means those Persons f or which the Part icipants have caused the Depository to hold Book-Entry Bonds.
“Bond Counsel” means a firm of na tionally r ecognized bond counsel selected by th e Community Facilities District.
“Bond Fund” means the Fund by that name established and held by the Trustee pursuant to Section 5.03.
“Bond Year” means the twelve-month period beginning on September 2 in each year and extending to the next succeeding September 1, both dates inclusive, except that the first Bond Year shall begin on the Closing Date and end on September 1, 2024. “Bonds” means t he City of Ontario Community Facilities District No. 56 (Parkside/La Avenida) Special Tax Bonds issued hereunder, and includes the Series 2023 Bonds and any Additional Bonds.
“Book-Entry Bonds” means the Bonds of a Series registere d i n the name of the Depository, or the Nominee th ereof, as the registe red owner th ereof pursuant to the t erms and provisions of Section 2.07.
417

5 4140-7971-6425.3

“Business Day” means a day that is not (a) a Saturday, Sunday or legal holiday in the State, (b) a day on w hich banking institutions in the State, or in any state in which the Office of the Trustee is located, are required or authorized by law (including executive order) to close, or (c) a day on which the New York Stock Exchange is closed.
“Cede & Co.” means Cede & Co., the nominee of D TC, and any successor nominee of DTC with respect to a Series of Book-Entry Bonds.
“Circulation System Facility” has the meaning ascribed to the term “Circulation System Segment” in the NMC Acquisition Agreement.
“City” means the City of Ontario, a general law city organized and existing under the laws of the State, and its successors.
“City Council” means the City Council of the City.
“City Facilities Account” means the Account by that name within the Improvement Fund established and held by the Trustee pursuant to Section 3.04. “City Park Account” means the Account by that name within t he Improvement Fund established and held by the Trustee pursuant to Section 3.04. “Closing D ate” means the d ate upon w hich the Series 2023 Bonds are delivered to the Original Purchaser, being ____________, 2023.
“Code” means the Internal Revenue Code of 1986.
“Community Facilities District” means City of Ontario Community Facilities D istrict No. 56 (Parkside/La Avenida), a community facilities district organized and existing under the laws of the State, and its successors.
“Continuing Disclosure Agreement” means the Continuing Disclosure Agreement, dated as of __________ 1, 2023, b y an d bet ween t he Community Fa cilities Di strict and Zions Bancorporation, National Association, as Trustee, as originally executed and as it may be amended, supplemented or otherwise modified from time to time in accordance with the terms thereof. “Corresponding Bo nd Year” means, with respect to any Fis cal Year, the Bond Year that commences in such Fiscal Year.
“Costs of Is suance” means all items of exp ense directly or indirectly payable by or reimbursable to the Community Facilities District relating to the authorization, issuance, sale and delivery of the Bonds, including printing expenses, rating agency fees, filing and recording fees, initial fees, expenses and charges of the Trustee and its counsel, including the Trustee’s first annual administrative fee, fees, charges and disbursements of a ttorneys, municipal advisors, accounting firms, consultants an d other profes sionals, fees an d charges for preparation, e xecution and safekeeping of the Bonds, any premium for a bond insurance policy securing payment of the Bonds, any premium for a reserve facility and any other cost, charge or fee in connection with the original issuance of the Bonds.
418

6 4140-7971-6425.3

“Costs of Issuance Fund” means the Fund by that name established and hel d by the Trustee pursuant to Section 3.03.
“County” means the County of San Bernardino, a county and political subdivision of the State organized and existing under the laws of the State, and any successor thereto. “County Assessor” means the Assessor of the County.
“County Auditor” means the Auditor-Controller of the County. “Defeasance Securities” means (a) non-callable direct obligations of the United States of America (“United States Treasury Obligations”), and (b) evidences of ownership of proportionate interests in future interest and principal payments on United States Treasury Obligations held by a bank or trust company as cu stodian, under which the owner of the investment is the real party in interest and has the right to proceed directly and individually against the obligor and the underlying United States Treasury Obligations are not available to any person claiming through the custodian or to whom the custodian may be obligated.
“Depository” means DTC, and its successors as securities depos itory for a ny Series of Book-Entry Bonds, including any such successor appointed pursuant to Section 2.07. “Developed Property” has the meaning ascribed to such term in the Rate and Method. “DTC” means The Depository Trust Company, a limited-purpose trust company organized under the laws of the State of New York.
“Electronic Means” means e-mail, facsimile transmission, secure electronic transmission containing applicable authorization cod es, passwords and/or authenticat ion keys issued by the Trustee, or another m ethod or system specified by the Trustee as available for use in connection with its services hereunder.
“Event of Default” means any event specified in Section 7.01. “Facilities” means the facilities authorized to be financed by the Communi ty Facilities District, as described in the Resolution of Formation.
“Final Mapped Property” has the meaning ascribed to such term in the Rate and Method. “Final Mapped/Undeveloped Property” means, for any Fiscal Year, collectively, all parcels that are Final Mapped Property for such Fiscal Year and all parcels that are Undeveloped Property for such Fiscal Year.
“Fiscal Year” means the period beginning on July 1 of each year and ending on the next succeeding June 30, or any other twelve -month period hereafter selected and designated as the official fiscal year period of the Community Facilities District. “Funds” means the separate funds from time to time established and maintain ed by the Trustee pursuant hereto.
419

7 4140-7971-6425.3

“Improvement Fund” means the Fund by that name established and held by the Trustee pursuant to Section 3.04.
“Indenture” means this Indenture, dated as of __________ 1, 2023, by and between the Community Facilities District and Zions B ancorporation, National Assoc iation, as Tru stee, as originally executed and as it may be modified or amended from time to time by any Supplemental Indenture.
“Independent Consultant” means any consultant or firm of such consultants selected by the Community F acilities District and who, or each of w hom (a) is generally recogniz ed to be qualified in the financial consulting field, (b) is in fact independent and not under the control of the Community F acilities District, the City , NMC Builders , SC Ontario or an y A ffiliate thereof, (c) does not have any substantial interest, direct or indirect (i) with or in the Community Facilities District, the City, NMC Builders, SC Ontario or any Affiliate thereof, (ii) with or in any owner of real property in the Community Facilities District, or (iii) in any real property in the Community Facilities District, and (d) is not connected with the Community Facilities District, the City, NMC Builders, SC Ontario or any Affiliate thereof as an officer or employee thereof, but who may be regularly retained to make reports to the Community Facilities District or the City. “Interest Account” means the Account by that name within the Bond Fund established and held by the Trustee pursuant to Section 5.03.
“Interest Payment Dates” means March 1 a nd September 1 of each year, commencing ________ 1, 20__.
“Letter of Representations” means the Letter of Re presentations from the Community Facilities District to the Depos itory, in which the Community Facilities Dis trict makes certain representations with respect to issues of its securities for deposit by the Depository. “Maximum Annual Debt Service” means the largest Annual Debt Service for any Bond Year, including the Bond Year in which the calculation is made. “Maximum Special Tax” has the meaning ascribed to the term “Maximum Special Tax A” in the Rate and Method.
“Moody’s” means Moody’s Investors Serv ice, Inc., a corporation dul y orga nized and existing under the laws of the State of Delaware, and its successors and assigns, except that if such entity shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, th en the t erm “Moody’s” sh all be deemed to refer to any other nationally r ecognized securities rating agency selected by the Community Facilities District. “Net Special Tax Revenues” means Special Tax Revenues, less amounts required to pay Administrative Expenses.
“NMC Acquisition Ag reement” means the Amended and Restated Acquisition and Funding Agreement, dated as of November 1, 2022, by and between the City and NMC Builders, as originally executed and as it may be amended, supplemented or otherwise modified from time to time in accordance with the terms thereof.
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“NMC Builders” means NMC Builders, LLC, a limited liability company organized and existing under the laws of the State of California, and any successor thereto. “NMC Facilities” has the meaning ascri bed to the t erm “Facilities” in the NMC Acquisition Agreement.
“NMC Payment Request” has the meaning ascribed to the term “Payment Request” in the NMC Acquisition Agreement.
“Nominee” means the nominee of the Deposit ory, w hich may be the Depository, as determined from time to time pursuant to Section 2.07.
“Office of the Trustee” means the principal corporate trust office of the Trustee in Los Angeles, California, or such other office as may be specified to the Community Facilities District by the Trustee in writing; provided, however, that with respect to presentation of Bonds for payment or for registration of transfer and exchange, such term shall mean the office or agency of the Trustee at which, at any particular time, its corporate trust agency business shall be c onducted, which other office or agency shall be specified to the Community Facilities District by the Trustee in writing. “Ordinance” means any ordinance adopted by the City Council levying the Special Tax. “Original Purchaser” means the orig inal purchaser of the Series 2023 Bonds from the Community Facilities District.
“Other CFD Bonds” means, as of the date of determination, any and all bonds, notes or other evidences of indebtedness, other than the Bonds, then outstanding issued under the Act and payable, solely or partly, from special taxes to be levied pursuant to the Act on parcels of Taxable Property.
“Outstanding” means, when used as of any particular time with reference to Bonds, subject to the provisions of Section 11.07, all Bonds theretofore, or thereup on being, authent icated and delivered by the Trustee under this Indenture except (a) Bonds theretofore canceled by the Trustee or surrendered to the Trustee for cancellation, (b) Bonds with respect to which all liability o f the Community Facilities District shall have been discharged in accordance with Section 10.01, and (c) Bonds in lieu of which other Bonds shall have been authenticated and delivered by the Trustee, or that have been paid without surrender thereof, pursuant to Section 2.08. “Owner” means, with respect to a Bond, the Person in whose name such Bond is registered on the Registration Books.
“Participant” means any entity that is recognized as a participant by DTC in the book-entry system of maintaining records with respect to Book-Entry Bonds. “Participating Underwriter” has the meaning ascribed to suc h t erm in th e Continuing Disclosure Agreement.
“Permitted Investments” is defined in Exhibit A hereto. 421

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“Person” means an individual, corporation, limited liability company, firm, association, partnership, trust or other legal entity or group of entities, i ncluding a governmental entity or any agency or political subdivision thereof.
“Principal Account” means the Account by that name within the Bond Fund established and held by the Trustee pursuant to Section 5.03.
“Projected Administrative Expenses” means (a) for the then current Fiscal Year, 102% of the actual Administrative Expenses for the immediately preceding Fiscal Year, and (b) for any subsequent Fiscal Year, the amount resu lting from increa sing the Projected Admi nistrative Expenses on each July 1, from and including the July 1 immediately following the end of the then current Fiscal Year to and including the July 1 in such subsequent Fiscal Year, by 2% of the amount in effect for the previous Fiscal Year.
“Qualified Appraisal Report” means a real estate appraisal report that (a) has been prepared by a Qualified Appraiser, (b) uses a date of value that is no earlier than three months prior to the date on which the value report ed in such apprai sal report is used in accordance with the provisions of this Indenture, (c) is prepared in accordance wi th the a pplicable standards of the Appraisal Institute for such reports, and (d) is prepared in accordance with the applicable guidelines of the California Debt and Investment Advisory Commission for such reports, as such guidelines are in effect on the Closing Date.
“Qualified Appraiser” means a real estate appraiser selected by the Community Facilities District and having an “MAI” designation from the Appraisal Institute. “Rate and Method” means the rate and metho d o f a pportionment of the Spec ial Tax approved by the qualified electors of the Community Facilities District. “Rebate Fund” means the Fund by that name established and held by the Trustee pursuant to Section 5.06.
“Rebate Requirement” has the meaning ascribed to such term in the Tax Certificate. “Record Date” means, with respect to interest payable on any Interest Payment Date, the 15th calendar day of the month preceding such Interest Payment Date, whether or not such day is a Business Day.
“Redemption Fund” means the Fund by that name established and held by the Trustee pursuant to Section 5.05.
“Redemption Price” means the aggregate amount of principal of and premium, if any, on the Bonds upon the redemption thereof pursuant hereto.
“Registration Books” means the records maintained by the Trustee for the registration of ownership and registration of transfer of the Bonds pursuant to Section 2.05. “Reserve Fund” means the Fund by that name established and held by the Trustee pursuant to Section 5.04.
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“Reserve Requirement” means, as of the date of any calculation, the least of (a) “10% of the proceeds of the issue,” within the meaning of Section 148 of the Code, with respect to the Bonds (excluding from such calculation Bonds refunded with the proceeds of subsequently issued Bonds), (b) Maximum Annual Debt Service, and (c) 125% of Average Annual Debt Service. “Resolution o f Formation” means R esolution No. 2021-188, adopted b y the City Council on December 21, 2021, as o riginally adopted and as it ma y be amended, supplemented or otherwise modified from time to time.
“S&P” means S&P Global Rat ings, a business unit of Standard a nd Poor’s Financial Services, LLC, and its successors and assigns, except th at if such entity sha ll be dissolved or liquidated or sh all no longer perform the functions of a securit ies r ating ag ency, then the t erm “S&P” shall be deemed to refer to any other nationally recognized securities rating agency selected by the Community Facilities District.
“SC Ontario” means SC Ontario Development Company, LLC, a limited liability company organized and existing under the laws of the State of Delaware, and any successor thereto. “SC O ntario Acquisition Account” means the Account by that name within the Improvement Fund established and held by the Trustee pursuant to Section 3.04. “SC Ontario Acquisition Agreement” means the Acquisition and Funding Agree ment, dated as of December 1, 202 1, by and between the City and SC Ontario, as the same may be amended, supplemented o r otherwise modified from time to ti me in accordance with the terms thereof.
“SC Ontario Facilities” has the meaning ascribed to the term “Facilities” in the SC Ontario Acquisition Agreement.
“SC Ontario Payment Request” has the meaning ascribed to the term “Payment Request” in the SC Ontario Acquisition Agreement.
“Series” means the initial series of Bonds executed, authenticated and delivered on the date of initial issuance of the Bonds and designated pursuant to this Indenture as the Series 2023 Bonds, and any Additional Bonds issued pursuant to a Supplemental Indenture and identified as a separate Series of Bonds.
“Series 2023 Bonds” means the City of Ontario Community Facilities District No. 56 (Parkside/La Avenida) Special Tax Bonds, Series 2023, issued hereunder. “Services” has the meaning ascribed to such term in the Rate and Method. “Special Ta x” means the special tax described and defined in the Rate and Method as “Special Tax A” approved by the qualified electors to be l evied within the C ommunity Facilities District pursuant to the Act and the Rate and Method.
“Special Tax Fund” means the Fund by that name established and held by the Trustee pursuant to Section 5.02.
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“Special Tax Revenues” means the proceeds of the Special Tax received by or on behalf of the Community Facilities District, other than proceeds of the Special Tax levied to pay the costs of Services received by or on behalf of the Community Facilities District, including any prepayments thereof, interest and penalties thereon and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Tax, which shall be limited to the amount of said lien and interest and penalties thereon.
“State” means the State of California.
“Supplemental Indenture” means any supplemental indenture modifying or amending this Indenture, but only if and to the extent that such Supplemental Indenture is specifically authorized hereunder.
“Tax Certificate” means the Tax Certificate executed by the Community Facilities District at the time of issuance of the Series 2023 Bonds relating to the requirements of Section 148 of the Code, as originally executed and as it may be amended, supplemented or otherwise modified from time to time in accordance with the terms thereof.
“Tax Zone 1 NMC Ac quisition Account” means the Account by that name within the Improvement Fund established and held by the Trustee pursuant to Section 3.04. “Tax Zone 2 NMC Acquisition Account” means the Account by that name within the Improvement Fund established and held by the Trustee pursuant to Section 3.04. “Tax Zone 3 NMC Acquisition Account” means the Account by that name within the Improvement Fund established and held by the Trustee pursuant to Section 3.04. “Taxable Property” has the meaning ascribed to such term in the Rate and Method. “Trustee” means Zions Banco rporation, N ational Association, a national ban king association organized and existing under the laws of the United States of America, or any successor thereto as Trustee hereunder substituted in its place as provided herein. “Undeveloped Property” has the meaning ascribed to such term in the Rate and Method. “Verification Report” means, with respect to the deemed payment of Bonds pursuant to clause (ii) of Section 10.02(a), a report of a nationally recognized certified public accountant, or firm of such accountants, verifying that the Defeasance Securities and cash, i f any, deposited in connection with such deemed payment satisfy the requirements of clause (ii) of Section 10.02(a). “Written Certificate” and “Written Request” of the Community Facilities District mean, respectively, a written certificate or written request signed in the name of the Community Facilities District by a n Authorized Representative. Any such c ertificate or request may, but need not, be combined in a single instrument with any other instrument, opinion or representation, and the two or more so combined shall be read and construed as a single instrument.

Section 1.02. Rules o f Constructi on. (a) The terms def ined her ein ex pressed in the singular shall, unless the context otherwise indicates, include the plural and vice versa. 424

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(b) The us e herein of the masculine, feminin e or neuter ge nder is for convenience only and shall be deemed and construed to include correlative words of the masculine, feminine or neuter gender, as appropriate.
(c) References herei n to a d ocument s hall include all amend ments, suppl ements or other modifications to suc h document, and any replacements, substitutions or novation of, th at document.
(d) Any term defined herein by reference to a nother document shall continue to have the meaning ascribed thereto whether or not such other document remains in effect. (e) The use herein of the words “in cluding” a nd “in cludes,” and words of similar import, shall be deemed to be followed by the phrase “without limitation.” (f) Headings of Articles and Sections herein and the table of con tents her eof are solely for convenience of reference, do not cons titute a part hereo f and shall not af fect t he meaning, construction or effect hereof.
(g) All references herein to d esignated “Articles,” “Sections ,” “Exhibits,” “subsections,” “para graphs,” “cla uses,” an d other subd ivisions are to the de signated Artic les, Sections, Exhibits, subsections, paragraphs, clauses, and other subdivisions of this Indenture. (h) The words “hereof” (except wh en preceded by a spec ific Sectio n or Ar ticle reference) “herein,” “he reby,” “h ereunder,” “ hereinabove,” “hereina fter,” and oth er equiv alent words and phr ases u sed herein r efer t o this Indentur e and not solel y to the particular portion hereof in which any such word is used.
(i) Any reference to a Pe rson, or a Person in a specified capacity, shal l be construed to include such Person’s successors or such Person’s successors in such capacity, as the case may be.

Section 1.03. Equal Security. In consideration of the acceptance of t he Bonds by the Owners thereof, this Indenture shall be deem ed to be and shall co nstitute a c ontract among the Community Facili ties District, t he Trustee and the Owners from time to time of all Bonds authorized, executed, issued and delivered hereunder and then Outstanding to secure the full and final payment of the principal of, premium, if any, and interest on all Bonds that may from time to t ime be authorized, execut ed, issued and d elivered hereun der, subjec t to the agreements, conditions, cove nants and provisions contained herein; and all agr eements and covenan ts se t forth herein to be performed by or on behalf of the Community Facilities District shall be for the equal and pr oportionate benefit, protection and secu rity of all Owne rs of the Bon ds without distinction, preference or priority as to security or otherwise of any Bonds over any other Bonds by reason of the number or date thereof or the time of authorization, sale, execution, issuance or delivery thereof or for any cause whatsoever, except as expressly provided herein or therein. 425

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ARTICLE II

THE BONDS
Section 2.01. Authorization of Bonds; Speci al, L imited Obligations. (a) The Community Facilities District hereby authorizes the issuance of the Bonds unde r and subject to the terms of t his Indenture, the Act and other appli cable laws of the Sta te. Th e Bonds may consist of one or more Series of Bonds of varying denominations, dates, maturities, interest rates and other provisions, subject to the provisions and conditions contained herein. The Bonds shall be designa ted gene rally as the “City of On tario Community Facilities District No. 56 (Parkside/La Avenida) Special Tax Bonds,” ea ch Series thereof to be ar su ch additional designation as may be necessary or appropriate to distinguish such Series from every other Series of Bonds.
(b) The Bonds s hall be special, lim ited obligations of t he Com munity Facilitie s District, payable, as provided herein, solely from Net Special Tax Revenues and the other assets pledged therefor hereunder. Neither the faith and credit nor the taxing power of the Community Facilities District (except to th e limit ed ext ent set forth he rein), the City or the S tate, or any political subdivision thereof, is pledged to the payment of the Bonds.

Section 2.02. Terms of Series 2023 Bonds. (a) The Series 2023 Bonds sh all be designated “City of Ontario Community Facilities District No. 56 (Parkside/La Avenida) Special Tax Bonds, Series 2023 .” The aggregat e principal amount of Series 2023 Bonds that may be issued and Outstanding under this Indenture sh all n ot exceed $_________, except as ma y be otherwise provided in Section 2.08.
(b) The Series 2023 Bonds shall be issued in fully registered form without coupons in Authorized Denominations, so long as no Series 2023 Bond shall have m ore than one maturity date. T he Series 2 023 Bonds sh all be dated as of the Closing Da te, sh all be in the ag gregate principal amount of $_________, shall mature on September 1 of each year, shall bear interest at the rates per annum (ca lculated on the basi s of a 360-day year comprised of twel ve 30-day months) and shall be in the principal amounts as follows:

Maturity Date
(September 1)
Principal
Amount
Interest
Rate
$ %

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Maturity Date
(September 1)
Principal
Amount
Interest
Rate

(c) Interest on the Series 2023 Bonds shall be payable from the Interest Payment Date next preceding the date of authenticati on thereof unl ess (i) a Series 2023 Bond is authenticated on or before an Interest Payment Date and after the cl ose of busin ess on the preceding Recor d Date, in which event interest thereon shall be payable from such Interest Payment Date, (ii) a Series 2023 Bond is aut henticated on or before the first Record Date, in which event int erest thereon shall be payable from the Closing Date, or (iii) interest on any Series 2023 Bond is in default as of the date of authentication thereof, in which event interest t hereon shall b e payable from the date to which interest has previously been paid or duly provided for. Interest shall be paid in lawful money of the U nited States on each Interest Payment D ate. Interest shall be paid by check of the Trustee mailed by first -class mail, p ostage prepaid, on each Interest Payment Date to the Owners of th e Series 2023 Bonds at their resp ective addre sses shown on the Registration Books as of t he close of business on the pre ceding Record Date. Notwithstanding the foregoing, interest on any Series 2023 Bond that is not punctually paid or duly provided for on any I nterest Payment Date shall, if and to t he extent that amounts subs equently be come available therefor, be paid on a payment date established by the Trustee to the Person in whose name the ownership of such Series 2023 Bond is r egistered on the Reg istration Books at the close of business on a spe cial record date to be esta blished by the Trustee for the payment of such defaulted interest, notice of which shall be given to such Owner not less than ten days prior to such special record date.
(d) The principal of the Series 2023 Bonds shall be payable in lawful money of the United States of America upon pr esentation an d surrende r thereof upon maturity or earlier redemption at the Office of the Trustee.
(e) The Series 2023 Bonds shall be subject to redemption as provided in Article IV. (f) The Series 2023 Bonds shall be in substantially the form set f orth in Exhibit B hereto, wi th appropr iate o r ne cessary insertions, omissions and variations as permitted or required hereby.

Section 2.03. Execution of Bonds. The Bonds shall be executed in the n ame and on behalf of the Community Facilities District wit h the manual or facsimile signature of the Mayor of the City attested by the manual or facsimile signature of the City Clerk of the City. The Bonds shall then be delivered to the Trustee for authentication by it. In ca se any of su ch officers who shall have signed or attested any of the Bonds shall cease to be such officers before the Bonds so signed or atteste d shall have b een authenticated or del ivered by the Tr ustee, or issued by the Community Facilities District, suc h Bonds may nevertheless be authentica ted, delive red and issued and, upon suc h authenti cation, de livery and issue, shall be as binding upon the Community Facilities District as though those who signed and attested the same had continued to be such officers, and also a ny Bonds may be signed and attested on behalf of the Community Facilities District by such Persons as at the actual date of executio n of such Bond s shall be the proper officers of the City although at the nominal date of such Bonds any such Person shall not have been such officer of the City.
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Section 2.04. Authentication of Bonds. Only such of the Bonds as shall bear thereon a certificate of authentication substantially in the form as that set forth in Exhibit B hereto for the Series 2023 Bonds, manually executed by the Trustee, shall be vali d or obliga tory fo r any purpose or enti tled to th e benefits of this Indenture, and such certificate of the Trustee shall be conclusive evidence that the Bonds so authenticated have been duly executed, authenticated and delivered hereunder and are entitled to the benefits of this Indenture.

Section 2.05. Registration Books. The Trustee shall keep or cause to be kept, at the Office of the Trustee, sufficient records f or the registration and transfer of o wnership of the Bonds, which shall be op en to inspection during re gular busin ess hou rs and u pon reasonabl e notice b y the Community Facilities District. Upon presentation f or such purpos e, the Trustee shall, under such reasonable regulations as it may prescribe, register or transfer or cause to be registered or transferred, on such records, the ownership of the Bonds.

Section 2.06. Transfer and Exchange of Bonds. (a) Any Bond may be tr ansferred upon the Regis tration Books by the Person in whose name it is registered, in person or b y such Person’s duly authorized attorn ey, upon surrender of such Bond to the Trustee for cancellation, accompanied by delivery of a written inst rument of transfer, duly executed in a form acceptable to the Trustee. Whenever any Bond or Bonds shall be so su rrendered for transfer, the Community Facilities District shall execute and the Trustee shall authenticate and shall deliver a new Bond or Bonds of the same Series and maturity in a like aggregate principal amount, in any Authorized Denomination. The Trustee shall require the Owner requesting such transfer to p ay any tax or other governmental charge required to be paid with respect to such transfer. (b) The Bonds m ay be exchanged at the O ffice of the Trustee fo r a like aggregate principal amount of Bonds of the same Series and maturity of other Aut horized Denominations.

The Trustee shal l require the pa yment by the Ow ner requesting such exchange of any tax or other governmental charge required to be paid with respect to such exchange. (c) The Trustee shall not be obligated to make any transfer or exchange of Bonds of a Series pursuant to this Section during the period established by the Trustee for the selec tion of Bonds of such Series for redem ption, or with respect to any Bonds of such Series selected for redemption.

Section 2.07. Book-Entry System. (a) Prior to the issuance of a Series o f Bonds, t he Community Facilities District may provide that such Se ries of Bonds shall initially be issue d as Book-Entry Bonds, and in such event, the Bonds of such Series for each maturity date shall be in the form o f a separate single fully registered Bo nd (which may be typewritten). Upon initial issuance, the ownership of each such Bond of such Series shal l be registered in the Registration Books in the name of the Nominee, as nominee of the Depository. The Series 2023 Bonds shall initially be issued as Book-Entry Bonds.

Payment of pr incipal o f, and interest and premium , if any, on, any Book -Entry Bond registered in the name of t he Nominee shall be made on the applicable payment date by wire transfer of New York clea ring house or equivalent next day funds or by wir e transfer of same day funds to the account of the Nomine e. Such paymen ts shall be made to the Nominee at the address that is, on the Record Date, shown for the Nominee in the Registration Books. 428

16 4140-7971-6425.3

(b) With respe ct to Book -Entry B onds, th e Community F acilities District a nd t he Trustee shall have no responsibility or obligation to any Participant or to any Person on behalf of which such a P articipant holds a n interest in such B ook-Entry Bonds. Without limiting the immediately preceding sentence, the Community Facilities District and the Trustee shall have no responsibility or obligation with respect to (i) the accuracy of the records of the Depository, the Nominee or any Participant with respect to any ownership int erest in Book-Entry Bonds, (ii) the delivery to any Participant or any other Person, other than an Owner as shown in the Registration Books, of any notice with respect to Book-Entry Bonds, including any notice of redemption, (iii) the selection by the Depo sitory and its Par ticipants of the bene ficial int erests in Book-Entry Bonds of a maturity to be redeemed i n the event su ch Book-Entry Bonds are redeemed in part, (iv) the payment to any P articipant or any other Person, other than an Owner as shown in the Registration Books, of any amount with respect to principal of, or premium, if any, or interest on Book-Entry Bonds, or (v) any consent given or other action taken by the Depository as Owner. (c) The Community Facilities Di strict a nd the Trustee may treat and c onsider the Person in whose name each B ook-Entry Bond is registered in the Registration Books as the absolute Owner of s uch Book -Entry Bond for the purpo se of p ayment o f principal of, and premium, if any, and interest on such Bond, for the purpose of selec ting any Bo nds, or portions thereof, to be redeemed, for the purpose of giving notices of redemption and o ther matters with respect to such Book -Entry Bond, for the purpose of registering transfers with respect to such Book-Entry Bond, for the purpose of o btaining an y consent or ot her action to be taken by Owners and for all other purposes whatsoever, and the Community Faci lities District and the Trustee shall not be affected by any notice to the contrary. (d) In the event of a red emption of all or a portion of a Book-Entry Bond , the Depository, in its discretion (i) may request the Trustee to authenticate and deli ver a new Book - Entry Bond, or (ii) if the Depository is the sole Owner of such Book-Entry Bond, shall make an appropriate notation on the Book-Entry Bond indicating the date and amounts of the reduction in principal thereof resulting from such redemption, except in the case of final payment, i n which case such Book-Entry Bond must be presented to the Trustee prior to payment. (e) The Trustee shall pay all p rincipal of, and p remium, if any, and i nterest on the Book-Entry Bonds only to or “upon the order of” (as that term is u sed in the Uniform Commercial Code as adopted in the State) the respective Owner, as shown in the Registration Books, or such Owner’s re spective attorney duly authorized in wr iting, and all such payments shall be valid and effective to fully satisfy and discharge the obligations with respect to payment of principal of, and premium, if any, and interest on the Book-Entry Bonds to the extent of the sum or sums so paid. No Person other than an Owner, as shown in the Registration Books, shall receive an authenticated Book-Entry Bond. Upon delivery by the Depository to the Owners, the Community Facilities District and the Trustee of written noti ce to the effect that the Depository has determin ed to s ubstitute a ne w nominee in place of the Nominee, a nd subject to the provisions herein with respect to Record Dates, the word Nominee in this Indenture shall refer to such nominee of the Depository.
(f) In order to qualify the Book-Entry Bonds for the Depository’s book-entry system, the Community Facilities Di strict shall e xecute and deliver to th e Depository a L etter of Representations. The execution and delivery of a Letter of Representations shall not in any way 429

17 4140-7971-6425.3

impose up on the C ommunity Facilities Dis trict o r t he Trustee any obligation whatsoever with respect to Persons having interests in such Book-Entry Bonds other than the Owners, as shown on the Registration Books. Such Letter of Representations may provide the time, form, content and man ner of tra nsmission, of notices to the D epository. In addition to t he execution a nd delivery of a Letter of Repres entations by th e Community Facilities District, t he Community Facilities District and the Trustee shall take such other a ctions, not inconsist ent with t his Indenture, as are reasonably necessary to qualify Boo k-Entry Bonds for the Depository’s boo k- entry program.
(g) In the event the Co mmunity Facilities District determines that it is in the best interests of t he Beneficial Owners that they be able to obtain certificated Bonds and that such Bonds should therefore b e made availab le and notifies the Depo sitory and the Trustee of such determination, the Depository will notify t he Participants of the availability th rough the Depository of ce rtificated Bo nds. In su ch even t, the Trustee shall transfer and exchange certificated Bonds as requested by the Depository and any other Owners in appropriate amounts.

In t he e vent (i) the Dep ository determines not to continue to act as secu rities depository for Book-Entry Bonds, or (ii) the Depository shall no longer so act and gives notice to the Trustee of such determi nation, t hen the Community Facilities Distr ict shall d iscontinue the Book -Entry system with the Depository. If t he Community Facilities Di strict determ ines to re place t he Depository with another qualified securities de pository, the Community Facilities Dis trict shall prepare or d irect the pr eparation of a new single, separate, f ully reg istered Bond of the appropriate Series for each maturity date of such Book-Entry Bonds, registered in the name of such successor or subs titute qualifi ed securities depository or its n ominee. If the Community Facilities D istrict fails to identify an other qu alified securities depository to replace the Depository, then the Boo k-Entry Bonds shall no longer be restricted to being registered in the Registration Books in the name of the Nomin ee, but shall b e registered in wha tever name or names the Owners transferring or exchanging such Bonds shall designate, in accordance with the provisions of Sections 2.06, 2.08 and 2.09. Whenever the Depositor y requests the Community Facilities District to do so, the Community Facilities District shall cooperate with the Depository in taking appropriate act ion after reasonable notice (i) to make available one or more separate certificates evidencing the Book -Entry Bonds to a ny Participant having Bo ok-Entry Bonds credited to its account with the Depository, and (ii) to arrange for another securities depository to maintain custody of certificates evidencing the Book-Entry Bonds. (h) Notwithstanding any other provision of this Inden ture to the contrary, if the Depository is the sole Owner of the Bonds of a Series, so long as any Book-Entry Bond of such Series is reg istered in the name of the Nominee, all payments of principal of, and premium, if any, and interest on such Book-Entry Bond and all notices with respect to such Book-Entry Bond shall be m ade and given, respectively, as provided in the Letter of Representat ions or as otherwise instructed by the Depository.
(i) In connection with any notice or other communication to be provided t o Owners pursuant to thi s Indenture by the Community Facilities District or the Trustee, with respect to any consent or other action to be taken by Owners of Book-Entry Bonds, the Trust ee shal l establish a record date for such consent or othe r action and g ive the Depository notic e of such record date not less than 15 calendar days in advance of such record date to the extent possible. 430

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Section 2.08. Bonds Mutilated, Lost, Destroyed or Stolen. If any Bond shall become mutilated, the Community Facilities D istrict, at th e expense of the Owner o f said Bo nd, shall execute, and the Trustee shall thereupon authenticate and deliver, a new Bond of the same Ser ies and maturity in a like principal amount in ex change and substitution for the Bond so mutilated, but on ly upon surren der to the Trustee of th e Bond so mutilated. Eve ry mutilated Bond s o surrendered t o the Trustee sh all be c anceled by it and delivered to , or upon t he orde r of, th e Community Facilities District. If any Bond shall be lost, destroyed or stolen, evidence of s uch loss, destruction or theft may be submitted to the Trustee and, if such evidence and indemnity reasonably satisfactory to the Truste e shall be given, the Community Facilities Distri ct, at the expense of the Owner, shall execute, and the T rustee shall thereupon authenticate and deliver, a new Bond of the same Series and maturity in a like aggregate principal amount in lieu of and in replacement for the Bond so lost, destroyed or stolen (or if any such Bond shall have matured or shall have been selected for redemption, instead of issuing a replacement Bond, the Trustee may pay the same without surrender thereof). The Community Facilities District may require payment by the Own er of a su m not e xceeding the a ctual cost of preparing the replacement Bond delivered thereto under this Section a nd the expenses incurred by the Co mmunity Facilities District and the Trustee in connection therewith . Any Bond of a Seri es issued under the provisions of this Section in li eu of any Bond of such Series allege d to be lost, destroyed or stolen shall constitute an original additional contractual obligation on the part of the Community Facilities District whether or not the Bond so alleged to be lo st, destroyed or stolen be at any time enforceable by anyone, and s hall be entitl ed to the benefits of th is Indenture with all other Bonds of such Series secured by this Indenture.

Section 2.09. Temporary Bonds . The Bonds of a Series may be issued in temporary form exchangeable for definitive Bonds of such Series when ready for del ivery. Any temporary Bonds may be prin ted, lithographed or typewritten, shall be of such Authorized Denominations as may be determined by the Communit y Facilities District, shall be in full y register ed form without coupons and may contain such reference to any of the pr ovisions of this Indentu re as may be appropriate. Every temporary B ond shall b e ex ecuted by the C ommunity Facilities District and authenticated by the Trustee upon the same conditions and in substantially the same manner as the definitive Bonds. If the Community Facilities District issues temporary Bonds of a Series it sh all execute and deliver definitive Bonds of such Series a s promptly t hereafter a s practicable, and thereupon the tempo rary Bo nds of such Se ries may be surrendered, for cancellation, at the Office of the Trustee an d the Tru stee sh all auth enticate and deliver i n exchange for such temporary Bonds an equal aggregate principal amount of definitive Bonds of such Serie s and matu rities in Authorized Denominations. Until so exchanged, t he temporary Bonds of such Series shal l be enti tled to the sam e benefits u nder th is Indenture as definitive Bonds of such Series authenticated and delivered hereunder. 431

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ARTICLE III

ISSUANCE OF SERIES 2023 BONDS; APPLICATION OF PROCEEDS; ADDITIONAL BONDS
Section 3.01. Issuance of Series 2023 Bonds. The Community Fa cilities District may at any time execute the Series 2023 Bonds and deliver the same to the Trustee. The Trustee shall authenticate the Series 2023 Bonds and deliver the Series 2023 Bonds to the Original Purchaser upon receipt of a Written Request of the C ommunity Facilities District and upon receipt of the purchase price therefor.

Section 3.02. Application of Proce eds. (a) On the Closing Date, the p roceeds of the sale of the Series 2023 Bonds received by the Truste e, $__________, shall be deposited by the Trustee as follows:
(i) the Trustee shall d eposit the amount of $________ in the Costs of Issuance Fund;
(ii) the Trustee shall deposit the amount of $_________ in the Reserve Fund, which is equal to the Reserve Requirement;
(iii) the Trustee shall deposit the amount of $_________ in the SC Ontario Acquisition Account;
(iv) the T rustee shall d eposit t he amount of $_________ in the Tax Zone 1 NMC Acquisition Account;
(v) the T rustee shall d eposit t he amount of $_________ in the Tax Zone 2 NMC Acquisition Account;
(vi) the T rustee shall d eposit t he amount of $_________ in the Tax Zone 3 NMC Acquisition Account;
(vii) the Trustee shall deposit the amount of $_________ in the City Facilities Account; and
(viii) the T rustee shall deposit the amount of $_________ in the City Park Account.
(b) [On the Closing Date, the amount transferred by the Community Facilities District to the Trustee, $_________, which consists of amounts o f the Special Tax collected by the Community Facilities District, shall be deposited by the Trustee as follows:
(i) the Trustee shall deposit the amount of $_________ in the Administrative Expense Fund;
(ii) the Tr ustee shall deposit the amou nt of $_________ in the Special Tax Fund; and
432

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(iii) the Trustee shall de posit [the amount of $_________ in the Tax Zone 1 NMC Acquisition Acco unt, the amount of $_________ in the Tax Zone 2 NMC Acquisition Account and the amount of $_________ in the Tax Zone 3 NMC Acquisition Account.]
Section 3.03. Costs of Issuance Fund. (a) The Trustee shall establish and maintain a separate Fund designated the “Costs of Issuance Fund. ” On the Closing Date, the Trustee shall deposit in the Cos ts of Issuance Fund the amount req uired to be deposited therein pursuant to Section 3.02. There shall additiona lly be deposited in the Cost of Issuance Fund the porti on, if any, of the proceeds of the sale of any Additional Bonds required to be deposited therein under the Supplemental Indenture pursuant to which such Additional Bonds are issued. (b) The moneys in the Costs of Issuance Fund shall be used and withdrawn by t he Trustee from time to time to pay the Costs of Issuance upon submission of a Written Request of the Community Facilities District stating (i) the Person to whom payment is to be made, (ii) the amount to be paid and instructions for such p ayment, (iii) th e purpose for which the obligat ion was incurred, (iv) that such payment is a proper charge against the Costs of Issuance Fund, and (v) that payment of such amount has not been the subject of a prior disbursement from the Costs of Issuance Fund, in eac h case together with a statement or invoice f or each amount requested thereunder. On the last Business Day that is no later than six months after the Closing Date, the Trustee shall transfer any amount remaining in the Costs of Issuance Fund to the [City Facilities Account] and, upon making such transfer, the Costs of Issuance Fund shall be closed. (c) If the Costs of Issuance Fund has been closed i n accordance with the provisions hereof, the Costs of Issuance Fu nd shall be reopened and reestablished by the Trustee in connection with the issua nce of any Ad ditional Bonds, if so p rovided in the Supplemental Indenture pursuant to which such Additional Bonds are issued.

Section 3.04. Improvement Fun d. (a) The Trustee shall establish and maintain a separate Fund designated the “Improvement Fund.” Within the I mprovement Fund, t he Trustee shall es tablish and maintain a separate Account designated the “SC Ontario Acquisition Account,” a separate Account designated the “ Tax Zone 1 NMC Acquisition Account,” a separate Account designated the “Tax Zone 2 NMC Acquisition Account,” a separate Account designated the “ Tax Zone 3 NMC Acquisition Account,” a separate Account designated the “City Facilities Account,” and a separate Account designated the “City Park Account.” On the Closing Date, the Trustee shall deposit in each of the Accounts within the Improvement Fund the amount required to be deposited th erein pursuant to Sec tion 3. 02. There shall addition ally be deposited in each of t he Accounts withi n the I mprovement Fund (i) the portion, if any, of the proceeds of the sale of a ny Add itional Bonds requi red to be deposited t herein unde r the Supplemental Indenture pursuant to w hich such Additional Bonds are issued, and (ii) amounts received by the T rustee w hen accompanied by a Written Request of the Community Facilities District that such amounts are to be deposited in such Account, which amounts may include Special Tax Rev enues collected and received by the Community Facilities District prior to the Closing Date.
(b) The moneys in the SC Ontario Acquisition Account shall be used and withdrawn by the Trustee from time to time to pay the costs of the SC Ontario Facilities upon submission of 433

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a Written Request of the Community Facilities District stating (i) the Person to whom payment is to be made, (ii) the amount to be paid and instructions for such p ayment, (iii) the purpose for which the obligation was incurred, (iv) that such payment is for costs of the SC Ontario Facilities and is a proper charge a gainst the SC Ontario Acquisition Account, (v) that payment of such costs has not been the sub ject of a p rior disbursement fr om any of the Accounts within the Improvement Fund, and (vi) whether or not such costs of the SC Ontario Facilities are to be paid pursuant to a SC Ontario Payment Request submitted in ac cordance with the SC On tario Acquisition Agreement, in each case toge ther with a stat ement or in voice for e ach amount requested thereunder. If costs of the SC Ontario Facilities are to be paid pursuant to a SC Ontario Payment R equest submitted in accordance with the SC Ont ario Acquisition Agreement, a duplicate original of the signed and approved SC Ontario Payment Request relating to such costs of the SC Ontario Facilities, together with all exhibits and attachments thereto, must accompany such Written Request of the Community Facilities District.

Upon the submission of a Written Certificate of the Community Facilities District stating (i) that the portion of the SC Ontario Facilities to be fin anced from the SC Ontario Acquisition Account has been completed and that all costs of such SC Ontario Facilities have been paid, or (ii) that such por tion o f the SC Ontario Facilities has bee n substantially completed and that al l remaining costs of such portion of the SC Ontario Facilities have been determined and specifying the amount to be retained therefor, the Trustee shall transfer all of the amount remaining in the SC Ontario Acquisition Account (less any such retention) to the Tax Zone 2 NMC Acquisition Account.
(c) The moneys in t he Tax Zone 1 NMC Acquisition Account shall be u sed an d withdrawn by the Trustee f rom time to time to pay the costs of th e NMC Facilities upon submission of a W ritten Request of the Community Facilities District statin g (i) the Person to whom payment is to be made, (ii) the amount to be paid and instructions for such payment, (iii) the purpose for which th e obligation was in curred, (iv) th at such p ayment is for costs of the NMC Facilities and is a pro per charge again st the Tax Zone 1 NMC Acquisition Account , (v) that payment of such costs has not been the sub ject of a p rior disbursement fr om any of the Accounts within the Improvement Fund , a nd (vi) whether or not su ch c osts of the NM C Facilities are to be p aid pursuant to a NMC Payment Request submitted in a ccordance with the NMC Acquisition Agreement, in each case together with a statement or invoice for each amount requested thereunder. If costs of the NMC Facilities are to be paid pursuant to a NMC Payment Request submitted in accordance with the NMC Acqui sition Agreement, a dupl icate original of the signed and approved NMC Payment Request relating to such costs of the N MC Facilities, together with all exhibits and attachments thereto, must accompany such Written Request of the Community Facilities District.

If, on the date the Community Facilities District submits to the Trustee a Written Request of the Community Facilities District to pay costs of the NMC Facilities, there are insufficient moneys in the Tax Zone 1 NMC Acquisition Account to pay such costs in full, the amount remaining unpaid shall be paid as and to the extent that moneys are subsequently deposited in the Tax Zone 1 NMC Acquisition Account, but only after the payment in full of all amounts that the Community Facilities District, by a Written Request of the Community Facilities District, previously directed the Trustee to pay from the Tax Zone 1 NMC Acquisition Account.
434

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If the NMC Payment Request submitted to the Trustee pursuant to this subsection requests that the costs of the NMC Facilities to be paid thereunder be paid to the Person or Persons, in the amounts, set f orth in the completed Purchase Price Payment Instructions attached to s uch NMC Payment Request as Attachment B, which Purchase Price Payment Instructions specify that such Purchase Price Payment Instructions relate to Tax Zone 1, the Trustee shall, as and when amounts become available in the Tax Zone 1 NMC Acquisition Account to pay all or a portion of such costs, pay from the Tax Zone 1 NMC Acquisition Account such costs or portion thereof to such Person or Persons. If the NMC Payment Request submitted to the Trustee pursuant to this subsection indicates that the costs of the NMC Facilities to be paid thereunder be paid to the Person or Persons, in the amounts, to be set forth in Purchase Price Payment Instructions to be submitted to the Trustee as and when amounts become available in the Tax Zone 1 NMC Acquisition Account to pay all or a portion of such costs, the Trustee shall, as and when such amounts become available, notify NMC Builders in writing of (i) the number or other designation of the NMC Payment Request pursuant to which such payment of such costs is requested to be made, (ii) the amount available in the Tax Zone 1 NMC Acquisition Account to pay such co sts o r por tion ther eof, an d (iii) the name of the Community Facilities District, and, upon submission to the Trustee by NMC Builders of completed and signed P urchase Pric e Pay ment Instructions in the form attac hed to such NMC Payment Request as Attachment B, which Purchase Price Payment Instructions specify that such Purchase Price Payment Instructions relate to Tax Zone 1, the Trustee shall pay from the Tax Zone 1 NMC Acquisition Account such costs or portion thereof to the Person or Persons, in the amounts, set forth in such Purchase Price Payment Instructions.

If, on the date the Community Facilities District submits to the Trustee a Written Request of the Community Facilities District to pay 85% of the costs of a Circulation System Facility, there are insufficient moneys in the Tax Zone 1 NMC Acquisition Account to pay such portion of such costs in full, the amount remaining unpaid shall be paid as and to the extent that moneys are subsequently deposited in the Tax Zone 1 NMC Acquis ition Account, but only after the payment in full of all amounts that the Community Facilities District, by a Written Request of the Community Facilities District, previously directed the Trustee to pay from the Tax Zone 1 NMC Acquisition Account.

If the NMC Payment Request submitted to the Trustee pursuant to this subsection requests that 85% of the costs of a Circulation System Facility to be paid thereunder be paid to the Person or Persons, in the amounts, set forth in the completed Purchase Price Payment Instructions attached to such NMC Payment Request as Attachment B, which Purchase Price Payment Instructions specify that such Purchase Price Payment Instructions relate to Tax Zone 1, the Trustee shall, as and when amounts become available in the Tax Zone 1 NMC Acquisition Account to pay all or a portion of such costs, pay from the Tax Zone 1 NMC Acquisition Account such costs or portion thereof to such Person or Persons. If the NMC Payment Request submitted to the Trustee pursuant to this subsection indicates that 85% of the costs of a Circulation System Facility to be paid thereunder be paid to the Person or Persons, in the amounts, to be set forth in Purchase Price Payment Instructions to be submitted to the T rustee as and when amounts become available in the Tax Zone 1 NMC Acquisition Account to pay all or a portion of such costs, and which Purchase Price Payment Instructions specify that such Purchase Price Payment Instructions relate to Tax Zone 1, the Trustee shall, as and when such amounts become a vailable, n otify NMC Builders in writing of (i) the number or other designation of the NMC Payment Request pursuant to which such payment of such costs is requested to be made , (ii) the amount available in t he Tax Zone 1 NMC Acquisition Account to pay such costs o r portion ther eof, and (iii) the na me of t he C ommunity Facilities 435

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District, and, upon submission to the Trustee by NMC Builders of completed and signed Purchase Price Payment Instructions in the form attached to such NMC Payment Request as Attachment B, and which Purchase Price Payment Instructions specify that such Purchase Price Payment Instructions relate to Tax Zone 1, the Trustee shall pay from the Tax Zone 1 N MC Acquisition Account such costs or portion thereof to the Per son or Pe rsons, in the amounts, set forth in such Purchase Price Payment Instructions.

Upon the submission of a Written Certificate of the Community Facilities District stating (i) that the portion of t he NMC Facilities to be financed from the Tax Zone 1 NMC Acquisition Account has been completed and that all costs of such NMC Fac ilities have been paid, or (ii) that such portion of the NMC Facilities has been substantially completed and that all remaining costs of such portion of the NMC Facilities have been determined and specifying the amount to be retained therefor, the Trustee shall (A) if the amount remaining in t he Tax Zone 1 NMC Acquisition Account (less any such retention) is equal to or greater th an $25,000, transfer the portion of such amount equal to the largest integral multiple of $5,000 that is not greater than such amount to the Redemption Fund, to be applied to the redemption o f Bon ds as dir ected b y the Community Facilities District, and (B) after making the tra nsfer, if any, requ ired to be made pursuant to the preceding clause (A), transfer all of the amount remaining in the Tax Zone 1 NMC Acquisition Account (less any such retention) to the Interest Account, to be applied to the payment of interest on the Bonds.
(d) The moneys in t he Tax Zone 2 NMC Acquisition Account shall be u sed an d withdrawn by the Trustee f rom time to time to pay the costs of th e NMC Facilities upon submission of a W ritten Request of the Community Facilities District stating ( i) the Person to whom payment is to be made, (ii) the amount to be paid and instructions for such payment, (iii) the purpose for which th e obligation was in curred, (iv) th at such p ayment is for costs of the NMC Facilities and is a pro per charge again st the Tax Zone 2 NMC Acquisition Account , (v) that payment of such costs has not been the sub ject of a p rior disbursement fr om any of the Accounts within the Improvement Fu nd, a nd (vi) whether or not su ch c osts of the NM C Facilities are to be p aid pursuant to a NMC Payment Request submitted in a ccordance with the NMC Acquisition Agreement, in each case together with a statement or invoice for each amount requested thereunder. If costs of the NMC Facilities are to be paid pursuant to a NMC Payment Request submitted in accordan ce with the NMC Acqui sition Agreement, a dupl icate original of the signed and approved NMC Payment Request relating to such costs of the N MC Facilities, together with all exhibits and attachments thereto, must accompany such Written Request of the Community Facilities District.

If, on the date the Community Facilities District submits to the Trustee a Written Request of the Community Facilities District to pay costs of the NMC Facilities, there are insufficient moneys in the Tax Zone 2 NMC Acquisition Account to pay such costs in full, the amount remaining unpaid shall be paid as and to the extent that moneys are subsequently deposited in the Tax Zone 2 NMC Acquisition Account, but only after the payment in full of all amounts that the Community Facilities District, by a Written Request of the Community Facilities District, previously directed the Trustee to pay from the Tax Zone 2 NMC Acquisition Account.

If the NMC Payment Request submitted to the Trustee pursuant to this subsection requests that the costs of the NMC Facilities to be paid thereunder be paid to the Person or Persons, in the 436

24 4140-7971-6425.3

amounts, set f orth in the completed Purchase Price Payment Instructions attached to s uch NMC Payment Request as Attachment B, the Trustee shall, as and when amounts become available in the Tax Zone 2 NMC Acquisition Account to pay all or a portion of such costs, pay from the Tax Zone 2 NMC Acquisition Account such costs or portion thereof to such Person or Persons. If the NMC Payment Request submitted to the Trustee pursuant to this subsection indicates that the costs of the NMC Facilities to be p aid thereunder be paid t o the Person or Persons, in the amounts, to be set forth in Purchase Price Payment Instructions to be submitted to the Trustee as and when amounts become available in the Tax Zone 2 NMC Acquisition Account to pay all or a portion of such costs, the Trustee shall, as and when such amounts become available, notify NMC Builders in writing of (i) the number or other designation of the NMC Payment Request pursuant to which such payment of such costs is requested to be made, (ii) the amount available in the Tax Zone 2 NMC Acquisition Account to pay such co sts o r po rtion thereof, an d (iii) the name of the Community Facilities District, and, upon submission to the Trustee by NMC Builders of completed and signed Purchase Price Payment Instructions in the form attached to such NMC Payment Request as Attachment B, the Trustee shall pay from the Tax Zone 2 NMC Acquisition Account such costs or portion thereof to the Person or Persons, in the amounts, set forth in such Purchase Price Payment Instructions.

If, on the date the Community Facilities District submits to the Trustee a Written Request of the Community Facilities District to pay 85% of the costs of a Circulation System Facility, there are insufficient moneys in the Tax Zone 2 NMC Acquisition Account to pay such portion of such costs in full, the amount remaining unpaid shall be paid as and to the extent that moneys are subsequently deposited in the Tax Zone 2 NMC Acq uisition Account, but only after the payment in full of all amounts that the Community Facilities District, by a Written Request of the Community Facilities District, previously directed the Trustee to pay from the Tax Zone 2 NMC Acquisition Account.

If the NMC Payment Request submitted to the Trustee pursuant to this subsection requests that 85% of the costs of a Circulation System Facility to be paid thereunder be paid to the Person or Persons, in the amounts, set forth in the completed Purchase Price Payment Instructions attached to such NMC Payment Request as Attachment B, the T rustee shall, as and when amounts become available in the Tax Zone 2 NMC Acquisition Account to pay all or a portion of such costs, pay from the Tax Zone 2 NMC Acquisition Acc ount such costs or porti on thereof to such Person or Persons. I f the NMC Payment Request submitted to the Trust ee p ursuant to th is subsection indicates that 85% of the costs of a Circulation System Facility to be paid thereunder be paid to the Person or Persons, in the amounts, to be se t forth in Purchase Price Payment Instructions to be submitted to the T rustee as and when am ounts become available in the Tax Zone 2 NMC Acquisition Account to pay all or a portion of such costs, the Trustee shall, as and when such amounts become available, notify NMC Builders in writing of (i) the number or other designation of the NMC Payment Request pursuant to which such payment of such costs is requested to be made, (ii) the amount available in the Tax Zone 2 NMC Acquisition Account to pay such costs or portion thereof, and (iii) the name of the Community Facilities District, and, upon submission to the Trustee by NMC Builders of completed and signed Pu rchase Price Payment Ins tructions in the form attached to such NMC Payment Request as Attachment B, the Trustee shall pay from the Tax Zone 2 NMC Acquisition Account such costs or portion thereof to the Person or Persons, in the amounts, set forth in such Purchase Price Payment Instructions.

Upon the submission of a Written Certificate of the Community Facilities District stating (i) that the portion of t he NMC Facilities to be financed from the Tax Zone 2 NMC Acquisition 437

25 4140-7971-6425.3

Account has been completed and that all costs of such NMC Fac ilities have been paid, or (ii) that such portion of the NMC Facilities has been substantially completed and that all remaining costs of such portion of the NMC Facilities have been determined and specifying the amount to be retained therefor, the Trustee shall (A) if the amount remaining in t he Tax Zone 2 NMC Acquisition Account (less any such retention) is equal to or greater th an $25,000, transfer the portion of such amount equal to the largest integral multiple of $5,000 that is not greater than such amount to the Redemption Fund, to be applied to the redemption o f Bon ds as dir ected b y the Community Facilities District, and (B) after making the tra nsfer, if any, requ ired to be made pursuant to the preceding clause (A), transfer all of the amount remaining in the Tax Zone 2 NMC Acquisition Account (less any such retention) to the Interest Account, to be applied to the payment of interest on the Bonds.
(e) The moneys in t he Tax Zon e 3 NMC Acquisition Ac count shall be u sed an d withdrawn by the Trustee f rom time to time to pay the costs of th e NMC Facilities upon submission of a W ritten Request of the Community Facilities District stating ( i) the Person to whom payment is to be made, (ii) the amount to be paid and instructions for such payment, (iii) the purpose for which th e obligation was in curred, (iv) t hat such payment is for costs of the NMC Facilities and is a pro per charge again st the Tax Zone 3 NMC Acquisition Account , (v) that payment of such costs has not been the sub ject of a p rior disbursement fr om any of the Accounts within the Improvement Fund , and (vi ) whether or not su ch c osts of the NM C Facilities are to be p aid pursuant to a NMC Payment Request submitted in a ccordance with the NMC Acquisition Agreement, in each case together with a statement or invoice for each amount requested thereunder. If costs of the NMC Facilities are to be paid pursuant to a NMC Payment Request submitted in accordance with the NMC Acqui sition Agreement, a dupl icate original of the signed and approved NMC Payment Request relating to such costs of the N MC Facilities, together with all exhibits and attachments thereto, must accompany such Written Request of the Community Facilities District.

If, on the date the Community Facilities District submits to the Trustee a Written Request of the Community Facilities District to pay costs of the NMC Facilities, there are insufficient moneys in the Tax Zone 3 NMC Acquisition Account to pay such costs in full, the amount remaining unpaid shall be paid as and to the extent that moneys are subsequently deposited in the Tax Zone 3 NMC Acquisition Account, but only after the payment in full of all amounts that the Community Facilities District, by a Written Request of the Community Facilities District, previously directed the Trustee to pay from the Tax Zone 3 NMC Acquisition Account.

26 4140-7971-6425.3

portion of such costs, the Trustee shall, as and when such amounts become available, notify NMC Builders in writing of (i) the number or other designation of the NMC Payment Request pursuant to which such payment of such costs is requested to be made, (ii) the amount available in the Tax Zone 3 NMC Acquisition Account to pay such co sts o r por tion ther eof, an d (iii) the name of the Community Facilities District, and, upon submission to the Trustee by NMC Builders of completed and signed P urchase Pric e Pay ment Instructions in the form attac hed to such NMC Payment Request as Attachment B, which Purchase Price Payment Instructions specify that such Purchase Price Payment Instructions relate to Tax Zone 1, the Trustee shall pay from the Tax Zone 3 NMC Acquisition Account such costs or portion thereof to the Person or Persons, in the amounts, set forth in such Purchase Price Payment Instructions.

If, on the date the Community Facilities District submits to the Trustee a Written Request of the Community Facilities District to pay 85% of the costs of a Circulation System Facility, there are insufficient moneys in the Tax Zone 3 NMC Acquisition Account to pay such portion of such costs in full, the amount remaining unpaid shall be paid as and to the extent that moneys are subsequently deposited in the Tax Zone 3 NMC Acquisition Account , but only after the payment in full of all amounts that the Community Facilities District, by a Written Request of the Community Facilities District, previously directed the Trustee to pay from the Tax Zone 3 NMC Acquisition Account.

If the NMC Payment Request submitted to the Trustee pursuant to this subsection requests that 85% of the costs of a Circulation System Facility to be paid thereunder be paid to the Person or Persons, in the amounts, set forth in the completed Purchase Price Payment Instructions attached to such NMC Payment Request as Attachment B, which Purchase Price Payment Instructions specify that such Purchase Price Payment Instructions relate to Tax Zone 1, the Trustee shall, as and when amounts become available in the Tax Zone 3 NMC Acquisition Account to pay all or a portion of such costs, pay from the Tax Zone 3 NMC Acquisition Account such costs or portion thereof to such Person or Persons. If the NMC Payment Request submitted to the Trustee pursuant to this subsection indicates that 85% of the costs of a Circulation System Facility to be paid thereunder be paid to the Person or Persons, in the amounts, to be set forth in Purchase Price Payment Instructions to be submitted to the T rustee as and when amounts become available in the Tax Zone 3 NMC Acquisition Account to pay all or a portion of such costs, and which Purchase Price Payment Instructions specify that such Purchase Price Payment Instructions relate to Tax Zone 1, the Trustee shall, as and when such amounts become available, n otify NMC Builders in writing of (i) the number or other designation of the NMC Payment Request pursuant to which such payment of such costs is requested to be ma de, (ii) the amount available in t he Tax Zone 3 NMC Acquisition Account to pay such costs or portion ther eof, and (iii) the na me of t he C ommunity Facilities District, and, upon submission to the Trustee by NMC Builders of completed and signed Purchase Price Payment Instructions in the form attached to such NMC Payment Request as Attachment B, and which Purchase Price Payment Instructions specify that such Purchase Price Payment Instructions relate to Tax Zone 1, the Trustee shall pay from the Tax Zone 3 NMC Acquisition Account such costs or portion thereof to the Per son or Pe rsons, in the amounts, set forth in such Purchase Price Payment Instructions.

Upon the submission of a Written Certificate of the Community Facilities District stating (i) that the portion of t he NMC Facilities to be financed from the Tax Zone 3 NMC Acquisition Account has been completed and that all costs of such NMC Fac ilities have been paid, or (ii) that such portion of the NMC Facilities has been substantially completed and that all remaining costs of 439

27 4140-7971-6425.3

such portion of the NMC Facilities have been determined and specifying the amount to be retained therefor, the Trustee shall (A) if the amount remaining in t he Tax Zone 3 NMC Acquisition Account (less any such retention) is equal to or gr eater than $25,000, transfer the portion of such amount equal to the largest integral multiple of $5,000 that is not greater than such amount to the Redemption Fund, to be applied to the redemption o f Bon ds as dir ected b y the Community Facilities District, and (B) after making the tra nsfer, if any, requ ired to be made pursuant to the preceding clause (A), transfer all of the amount remaining in the Tax Zone 3 NMC Acquisition Account (less any such retention) to the Interest Account, to be applied to the payment of interest on the Bonds.
(f) The money s in th e City Facil ities Account shall be used and withdra wn by the Trustee from time to time to pay the costs of the Facilities upon submission of a Written Request of t he Co mmunity F acilities District stating (i) t he Perso n to whom p ayment is to be made, (ii) the amount to be paid a nd i nstructions for such paym ent, (iii ) th e purpose for which the obligation was inc urred, (iv) that s uch payment is for costs of the F acilities and is a pr oper charge against the City Facilities Account, and (v) that payment of such costs has not been the subject of a prior disbursement from any of the Accounts within the Improvement Fund, in each case together with a statement or invoice for each amount requested thereunder.

Upon the submission of a Written Certificate of the Community Facilities District stating (i) that the po rtion of the Facilities to be f inanced fro m th e City F acilities Account has been completed and that all costs of such Facilities have been p aid, or (ii) that s uch portion of the Facilities has been substantiall y completed and that all r emaining costs of su ch p ortion of the Facilities have been determined and specifying the amount to be retained therefor, the Trustee shall (A) if the amount remaining in the City Facilities Account (less any such retention) is equal to or greater than $25,000, transfer the portion of such amount equal to the largest integral multiple of $5,000 that is not greater than such amount to the Redemption Fund, to be applied to the redemption of Bonds as directed by the Community Facilities District, and (B) after making the transfer, if any, required to be made pursuant to the preceding clause (A), transfer all of the amount remaining in the City Fa cilities Account (less any such retention) to the Interest Account, to be applied to the payment of interest on the Bonds.
(g) The moneys in the City Park Account shall be used and withdrawn by the Trustee from time to time to pay the costs of the F acilities upon submission of a Written Request of the Community Facilities District stating (i) the Person to whom p ayment is to be made, (ii) the amount to be paid and instructions for such paym ent, (iii) the purpose for which the obligation was incurred, (iv) that s uch payment is for costs of the Facilities and is a proper charge against the City Park Account , and (v) that payment of such costs has not been the subject of a p rior disbursement from any of the Accounts within the Improvement Fund, in each case together with a statement or invoice for each amount requested thereunder.

Upon the submission of a Written Certificate of the Community Facilities District stating (i) that the portion of the Facilities to be financed from the City Park Account has been completed and that all costs of such Facilities have been paid, or (ii) that such portion of the Facilities has been substantially completed and that all r emaining costs of such p ortion of the Facilities have been determined and specifying the amount to be retained therefor, the Trustee shall (A) if the amount remaining in the City Park Account (less any such retention) is equ al to or greater than $25,000, 440

28 4140-7971-6425.3

transfer the portion of such amount equal to the largest integral multiple of $5,000 that is not greater than such amount to the Redemption Fund, to be applied to the redemption of Bonds as directed by the Community Facilities District, and (B) a fter making the tra nsfer, if any, required to be made pursuant to the preceding clause (A), transfer all of the amount remaining in the City Park Account (less any such retention) to the Interest Account, to be applied to the pay ment of interest on t he Bonds.

Section 3.05. Conditions fo r the Is suance of Additional Bo nds. The Community Facilities District may at any time issue one or more Series of Ad ditional Bonds payable from Net Special Tax Revenues as provided herein on a parity with all other Bonds theretofore issued hereunder, but only su bject to the following conditions, which are h ereby made conditions precedent to the issuance of such Additional Bonds:
(a) upon the iss uance of s uch Additional B onds, no Event of Default shall have occurred and be continuing hereunder;
(b) the issuance of such Ad ditional Bonds shall ha ve been authorized unde r and pursuant to this Indenture and the Act and shall have been provided for by a Supplemental Indenture, which shall specify the following:
(i) the purposes for which the proceeds of such Additional Bonds are to b e applied, w hich purpo ses may only include one or more of (A) providing funds to pay costs of the Facilities, (B ) providing funds to refu nd any B onds previously i ssued hereunder, ( C) p roviding f unds to p ay Costs of Issuance incurred in connection with th e issuance of such Ad ditional Bonds, and (D) providing funds to make any deposi t to the Reserve Fund required pursuant to paragraph (viii) below;
(ii) the designation of such Series of Additional Bonds, the aggregate principal amount o f the Additional Bonds of s uch Seri es, and the p rincipal amount of, and the interest rate to be borne by , each maturity of such Additional Bonds;
(iii) that such Additiona l Bonds shall be payable a s to i nterest on the Interest Payment Dates, except that the first installment of interest may be payable on either March 1 or September 1 and shall be for a period of not longer t han twelve months;
(iv) the date, the maturity date or dates an d the dat es on whi ch mandatory sinking fund redemptions, if any, are to be made for such Additional Bonds; pro vided, h owever, that each such matu rity date a nd date on which a mandatory sink ing fund redemption i s to be made shall be a September 1 an d, provided, further, that serial maturities of serial Bonds or mandatory sinking fund redemptions for term Bonds, or any combination thereof, shall be e stablished to provide for th e r edemption or payment o f su ch Additional Bonds on or before their respective maturity dates;
(v) the Authorized Denominations of such Additional Bonds; 441

29 4140-7971-6425.3

(vi) the re demption premiums and terms, if any, for such Ad ditional Bonds;
(vii) the form of such Additional Bonds;
(viii) the amount, if any, t o be deposit ed fro m the pr oceeds of sale of such Additional Bonds in the Reserve Fund; provided, however, that t he amount on deposit in the Reserve Fund at th e time that such Ad ditional Bonds become Outstanding shall be at least equal to the Reserve Requirement; and (ix) such other provisions that are appropriate or necessary and are not inconsistent with the provisions hereof;
(c) The Community Facilities District shall have received a certificate from one or more Independent Consultants that, taken together, certify that:
(i) on the basis of the parcels of land and improvements existing in the Community Facilities District as of the January 1 preceding the proposed issuance of such Additional Bonds, from and after the date of issuance of such Additional Bonds, for each Fiscal Year that Bonds will be Outstanding the amount of the Available Special Tax that may be levied on all Taxable Prop erty in such Fiscal Year is at least equal to 110% of Annual Debt Service for the Corr esponding Bond Year on all Outstanding Bonds; provided, however, that there shall be excluded from such calculation any Available Special Tax levied or that may be levied on any parcel of Taxable Property that, as of the date of such certificat e, is in default in the payment of any Special Tax levied thereon; (ii) the sum of (A) the Assessed Value of parcels of Taxable Property for which a Qua lified Appraisal Report has not been provided, plus (B) the Appraised Value of parcels of Taxable Property fo r which a Qu alified Appraisal Report has been provided, as such Appraised Value is shown in such Qualified Appraisal Report, is at l east seven times the sum of (I) the aggregate principal amount of all Bonds that will be Outstanding after the issuance of such Additional Bonds, plus (II) the aggregate principal amount of all fixed lien special assessments levied on pa rcels of T axable Property, based upon information from the most recent Fiscal Year for which such information is available, plus (III) the sum of a portion of the aggregate principal amount of Other CFD Bonds, which portion shall be equal to the aggregate principal amount of such Other C FD Bonds multiplied by a fra ction, the numerator of which is the amount of special taxes levied for such Other CFD Bonds on parcels of Taxable Property, and the denominator of which is the total amount of special taxes levie d for such Other CFD Bonds on al l parcels of land (such frac tion to be determined based upon the maximum special taxes that could be levied in the year in which maximum annual debt service on such Other CFD Bonds occurs), based upon information from the most recent Fiscal Year for which such information is available; and 442

30 4140-7971-6425.3

(iii) the sum of (A) the Assessed Value of parcels of Final Mapped/Undeveloped Pr operty for w hich a Qualified Appraisal Report has not been provided, plus (B) the Appraised Va lue of parcels of Final Mapped/Undeveloped Property for which a Qualified App raisal Report has been provided, as such Appraised Value is shown in such Qualified A ppraisal Report, is at least four times the sum of (I) a portion of the aggregate principal amount of all Bonds that will be Outs tanding after the issuan ce of such Addi tional Bonds , which portion shall be equal to the aggregate principal amount of such Outstanding Bonds multiplied by a fraction, the numerator of which is the amount of the Special Tax levied for such Ou tstanding Bonds on pa rcels of Final Mapped/Undeveloped Property, and the denominator of which is the total amount of the Special Tax levied for such Outstanding Bonds on all parcels of land (such fraction to be determined based upon the Maximum Special Tax that could be levied in the year in which Maximum Annual Debt Ser vice on such Outstanding Bonds occurs), plus (II) the aggregate principal a mount of all fixed lien special assessments levied on parcels of Final Mapped/Undeveloped Property , based upon information from the most recent Fiscal Year for wh ich such information is available, plus ( III) the sum of a portion of the aggregate principal amount of Other CFD Bonds, which portion shall be equal to the aggregate principal amount of such Other CFD Bonds m ultiplied by a fraction, the numerator of which is the amount of special taxes levied fo r such Other CFD Bonds on parcels of Final Mapped/Undeveloped Property, and the denominator of which is the total amount of special taxes levied for such Other CFD Bond s on all parcels of land (such fraction to be determined bas ed upon the maxim um special taxe s that could be levied in the year in which maxim um annual de bt service on such Other CFD Bonds occurs), based upon information from the most recent Fiscal Year for which such information is available.

Notwithstanding the fo regoing, if (i) s uch Additional Bonds are being issued to refund previously issue d Bonds, and (ii) the Community Fa cilities District shal l hav e received a certificate from an Independent Consultant certifying that Annual Debt Service in each Bond Year, calculated for all Bonds that will be Outstanding after the issuance of such Additional Bonds, will be less than or eq ual to Annual Debt Service in such Bond Y ear, calculated for all Bonds that are Outstanding immediately prior to the issuance of suc h Additional Bonds, the receipt of the certificate described in paragraph (c), above, shall not be a condition precedent to the issuance of such Additional Bonds.

Nothing contained herein shall limit the issuance of any special tax bonds payable from the Special Tax if, after the issuance and delivery of such special tax bonds, none of the Bonds theretofore issued hereunder will be Outstanding.

Section 3.06. Procedure for the Issuance of Additional Bonds. At any time after the sale of any Additional Bonds in accordance with t he A ct, su ch Additional Bo nds s hall be executed by the Community Facilities District for issu ance hereunder and shall be delivered to the Trus tee and thereupon shall be auth enticated a nd d elivered by the Trustee, but only upon receipt by the Trustee of the following:
443

31 4140-7971-6425.3

(a) a certified copy of the Supplemental Indenture authorizing the issuance of such Additional Bonds;
(b) a Written Request of the C ommunity Facilities District as to th e delivery of such Additional Bonds;
(c) a Written Certificate of t he Community Facilit ies District stating that the conditions precedent to the issuance of such Additional Bonds s pecified in Section 3.05 have been satisfied;
(d) an opinion of Bond C ounsel substan tially to t he e ffect th at (i) t his Indenture, as modified and a mended by all Supple mental Ind entures theretofore, or thereupon being, entered into has been duly authorized, executed and d elivered by, and constitutes the valid and binding obligation of, the Community F acilities D istrict, (ii) such Additional Bonds constitute valid and binding special, limited obligations of the Community Facilities District, and (iii) the issuance of such Additional Bonds, in and of itself, will not adversely affect the exclusion of interest on the Bonds Outstanding prior to the iss uance of such Additio nal Bonds f rom gross income for f ederal income tax purposes;
(e) the proceeds of the sale of such Additional Bonds; and (f) such further documents or money as ar e required by the provisions hereof or by the provisions of the Supplemental Indenture pursuant to whic h s uch Additional Bonds are issued.

Section 3.07. Additional Bonds. The Community Facilities District shall not incur any obligations payable f rom Net Special Tax Revenues on a par ity with the Bonds, except a s provided in Sections 3.05 and 3.06.
444

32 4140-7971-6425.3

ARTICLE IV

REDEMPTION OF BONDS
Section 4.01. Redemption of Series 2023 Bonds. (a) Optional Redemption. The Series 2023 Bonds maturing on and a fter September 1, 20__, shall be s ubject to op tional redemption, in whole, or in part in Authorized Denominations, on any Interest Payment Date on or a fter September 1, 20__ from any source of availabl e funds, at the foll owing resp ective Redemption Prices (expressed as percentages of the p rincipal amount of the Series 2023 Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Redemption Dates Redemption Price
September 1, 20__ and March 1, 20__ 103%
September 1, 20__ and March 1, 20__ 102
September 1, 20__ and March 1, 20__ 101
September 1, 20__ and any Interest
Payment Date thereafter
100

The Community Facilities District shall give the Trustee written notice of its in tention to redeem Series 2023 Bonds pursuant to this subsection not less than 45 days prior to the applicable redemption date, unless a later date is agreed to by the Trustee. (b) Mandatory Redemption from Special Tax Prepayments. The Series 2023 Bonds shall be subject to mandatory redemption, in whole, or in part in Authorized Denominations, on any Interest Payment Date, from and to the exten t of Special Tax prepayments required t o be applied ther eto pursuant to Section 5.0 2(a) and any am ount required to be app lied the reto pursuant to Section 5.04(c), at the following respective Redemption Prices (ex pressed as percentages of the principal amou nt of the Series 2023 Bonds to b e redeemed), plus accrue d interest thereon to the date of redemption:

Redemption Dates Redemption Price
March 1, 20__ through March 1, 20__ 103%
September 1, 20__ and March 1, 20__ 102
September 1, 20__ and March 1, 20__ 101
September 1, 20__ and any Interest
Payment Date thereafter
100

(c) Mandatory Sin king Fund Redemption. The Series 2023 Bonds matu ring September 1, 20__ shall be su bject to mandatory sinking fund redemption, in part, on September 1 in each year, commencin g September 1, 20__, at a Redemp tion Price equal to the principal amount of the Series 2023 Bonds maturing September 1, 20__ to be redeemed, without premium, plus ac crued interest thereon to the d ate of redem ption, i n the a ggregate respective principal amounts in the respective years as follows:
445

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Sinking Fund
Redemption Date
(September 1)
Principal Amount
to be
Redeemed
$

(Maturity)

If some but not all of the Series 2023 Bonds maturing on September 1, 20__ are redeemed pursuant to Section 4.01 (a), the principal amou nt of the Series 2023 Bonds mat uring on September 1, 20__ to be redeemed pursuant to Section 4.01(c) on any subsequent September 1 shall be reduced, by $5,000 or an integral multiple thereof, as designated by the Community Facilities District in a Written Certificate of the Community Fa cilities District submitted to the Trustee; provided, however, that the aggregate amount of such reductions shall not exceed the aggregate amount of the Series 2023 Bonds maturing on S eptember 1, 20__ redeemed pursuant to Section

4.01(a). If some but not all of the Series 2023 Bonds maturing on September 1, 20__ are redeemed pursuant to Sect ion 4.01(b), the principal amount of the Series 2023 Bonds maturing on September 1, 20__ to be redeemed pursuant to Section 4.01(c) on any subsequent September 1 shall be reduced by the aggregate principal amount of the Series 2023 Bonds maturing on September 1, 20__ so redeemed pursuant to Section 4.01(b), such reduction to be allocated among redemption dates as nearly as practicable on a pro rata basis in amounts of $5,000 or integral multiples thereof, as determined by the Trustee, notice of which determination shall be given by the Trustee to the Community Facilities District.

The Series 2023 Bonds maturing Septembe r 1, 20__ shall be subjec t to mandatory sinking fund redemption, in part, on September 1 in each year, commencing September 1, 20__, at a Red emption Pric e equ al to t he principal amount of t he Series 2023 Bonds maturing September 1, 20__ to be redeemed, without premium, plus accrued interest thereon to the date of redemption, in the aggregate respective principal amounts in the respective years as follows:

Sinking Fund
Redemption Date
(September 1)
Principal Amount
to be
Redeemed
$

(Maturity)

If some but not all of the Series 2023 Bonds maturing on September 1, 20__ are redeemed pursuant t o Section 4.01( a), the principal am ount of the Series 2023 Bonds m aturing o n September 1, 20__ to be redeemed pursuant to Section 4.01(c) on any subsequent September 1 shall be reduced, by $5,000 or an i ntegral multiple thereof, as designated by the Community Facilities District in a Writte n Certificate of th e Community Facilities District submitted to the Trustee; provided, however, that the aggregate amount of such reductions shall not exceed the aggregate 446

34 4140-7971-6425.3

amount of the Series 2023 Bonds maturing on September 1, 20__ redeemed pursuant to Sec tion

4.01(a). If some but not all of the Series 2023 Bonds maturing on September 1, 20__ are redeemed pursuant t o Sectio n 4.01(b ), the pr incipal a mount of the Series 2023 Bonds mat uring on September 1, 20__ to be redeemed pursuant to Section 4.01(c) on any subsequent September 1 shall be reduced by the aggregate principal amount of the Series 2023 Bonds maturing on September 1, 20__ so redeemed pursuant to Section 4.01(b), such reduction to b e allocated among redemption dates as nearly as practicable on a pro rata basis in amounts of $5,000 or integral multiples thereof, as determined by the Tr ustee, notice of which determination shall be given by th e Trustee to the Community Facilities District.

Section 4.02. Notice of Redemption. The Trustee on b ehalf and at the exp ense of the Community Facilities District shall mail (by first -class mail) notice of any redemption to the respective Ow ners of any Bonds designated for redemption at t heir respect ive addresse s appearing on the Registration Books, at least 30 but not more than 60 days prior to the date fixed for redemption. Such notice shall state the date of the notice, the redemption date, the redemption place and the R edemption P rice and shall designate the CUSIP numbers, if any, the Bond numbers and the m aturity or maturities of t he Bonds to be redeemed (except in the event of redemption of all of the Bonds of such maturity o r maturities in whole), and shall require that such Bonds be then surrendered at the Office of the Trustee for redemption at the Rede mption Price, giving notice also that further interest on such Bonds will n ot accrue from and after the date fixed for rede mption. Neither the failure to receive any n otice so ma iled, nor any defect in such notice, shall affect the validity of the proceedings for the redemption of the Bonds or the cessation of accrual of interest thereon from and after the date fixed for redemption. With respect to any notice of any opt ional redemption of Bonds, unless at the time such notice is given the Bonds to be r edeemed shall be deemed to have been paid within the m eaning of Section 10.02, such notice shall state that such red emption i s conditional upon rec eipt by the T rustee, on or prior to th e date fixed fo r such redemption, of moneys tha t, together with other a vailable amounts held by the Trustee, are sufficient to pay the Redemption Price of, and accrued interest on, the Bo nds to be redeemed, and that if such moneys shall not h ave b een so re ceived said notice shall be of no force and effect and the Community Facilities District shall not be required to redeem such Bonds. In the event a notice of redemption of Bonds contains such a co ndition and such moneys are not so received, the redemption of Bonds as described in the c onditional notice of redemption shall not be made and the Trustee shall, within a reasonable ti me after the date on which such redemption was to occur, give notice to the Persons and in th e manner in which the notice of redemption was given, that such moneys were not so received and that there shall be no redemption of Bonds pursuant to such notice of redemption.

Section 4.03. Selection of Bonds for Redemption . Whenever provision is made in this Indenture for the redemption of less than all of the Bonds, the Trustee shall select the Bonds to be redeemed from all Bonds not previously called for redemption (a) with respect to any optional redemption of Bonds of a Series, a mong matu rities of Bond s of suc h Series as d irected in a Written Requ est of the Comm unity Facilities District, (b) w ith respect to an y redem ption pursuant to S ection 4.01(b) and the correspondin g provisi ons o f any S upplemental Indenture pursuant to which Additional Bonds are issued, among maturities of all Series of Bonds on a pro rata basis as nearly as practicable, and (c) with respect to an y other redemption of Additional Bonds, among maturiti es as pro vided in the Supplemental Indenture pursuant to which such Additional Bonds are issued, and by lot among Bonds of the same Series with the same maturity 447

35 4140-7971-6425.3

in any manner that the Trustee in its sole discretion shall deem appropriate. For purposes of such selection, all Bonds shall be deemed to be comprised of the greatest number of se parate denominations that would result in each such deno mination being an Au thorized Denomination and each such separate denomination shall be treated as a separate Bond that may be separately redeemed.

Section 4.04. Partial Redemption of Bonds. Upon surrender of an y Bonds redeemed in part only, the Community Facilities Dist rict shall ex ecute and the Trustee shall authenticate and deliver to the Owner th ereof, at the ex pense of the Co mmunity Facilities District, a new Bond o r B onds of the same Series in Authorized De nominations in an agg regate prin cipal amount equal to the unredeemed portion of the Bonds surrendered.

Section 4.05. Effect of Notice of Redemption. (a) Notice of redemption of the Bonds subject to redemption having been mailed as aforesaid, and moneys f or the Rede mption P rice thereof, and the interest thereon to the applic able date fixed for redemption, having be en set aside with the Trustee, such Bonds shal l become due an d payable on sa id date, and, upon presentation and surrender thereof at the Office of the Trus tee, said Bonds shall be paid at the Redemption Price thereof, together with interest accrued and unpaid to said date. (b) If, on said da te fixed for r edemption, moneys for the Redemption Price of all th e Bonds to be redeemed, together with interest to said date, shall be held by the Trustee so as to be available therefor on such date, and, if n otice of redemption thereof shall h ave been ma iled as aforesaid and not canceled, then, from and after said date , interest o n said Bonds shall cease to accrue and become payable. All moneys held by or on behalf of the Trustee for the redemption of Bonds shall be held in trust for the account of the Owners of the Bonds so to be redeemed without liability to such Owners for interest thereon.
(c) All Bonds paid at maturity or redeemed prior to maturity pursuant to the provisions hereof shall be canceled upon surrender thereof and destroyed. 448

36 4140-7971-6425.3

ARTICLE V

SECURITY FOR BONDS; FLOW OF FUNDS; INVESTMENTS
Section 5.01. Pledge. Subject only to the pro visions of t his Ind enture per mitting t he application thereof for the purposes and on th e terms and conditions set forth herein, in order to secure the payment of the principal of, premium, if any, and interest on the Bonds in accordance with their terms, the provisions of this Indenture and the Act, the Community Facilities District hereby pledges to the Owners, and grants there to a lien on and a security interest in, all of the Net Special Tax Revenues and any other amounts held in the Special Tax Fund, the Bond Fund and the Reserve Fund. Said pledge shall constitute a first lien on and secu rity in terest in such assets, which sh all immediately attach to such assets and be effective, binding and enforceable against the Co mmunity Facilities District, its succ essors, purc hasers of any of such assets, creditors and all others asserting rights therein, to the extent set forth in, and in accordance with, this Indenture, irres pective of wh ether those parties hav e notice of the p ledge of, lien on and security interest in such assets and without the need for any physical delivery, recordation, filing or further act.

Section 5.02. Special Tax Fund. (a) The Trustee shall establish and maintain a separate Fund designated the “Special Tax Fund.” [On the Clos ing Date, the Trustee shall deposit in the Special Tax Fund the amount required to be deposited therein pursuant to Section 3.02.] As soon as practicable after the re ceipt b y t he Community Fac ilities D istrict of a ny S pecial Tax Revenues, but in any event no later than the date ten Bus iness Days af ter such receipt, the Community Facilities District shall transfer such Special Tax Revenues to the Trustee for deposit in the Special Tax Fund; provided, however, that with respect to any such Special Tax Revenues that represent a Special Tax prepayment (i) said Special Tax prepayment shall be identified as such in a Written Certificate of the Community Facilities District submitted to the Trustee at the time such Special Tax prepayment is transferred to the Trustee, (ii) the portion of su ch Special Tax prepayment that is to be applied to the Redemption Price of the Bonds shall be identified in such Written Certificate of the Commun ity Facilities District, shall be deposited by the Trustee in the Redemptio n Fund and s hall be applied to the r edemption of Bonds pu rsuant to Section

4.01(b) and the corresponding pro visions o f any Supplemental Ind enture pursuant to whi ch Additional Bonds are issued, and ( iii) the portion of such Special Tax prepayment that is to be applied to the payment of interes t on the Bonds to be so redeemed shall be identified in such Written Certificate of the Community Facilities District, shall be deposited by the Trustee in the Interest Account and shall be applied to the payment of such interest. (b) Upon receipt of a Written Request of the Commu nity Facilities Dist rict, the Trustee shall withdra w from the Special Tax Fund and transfer to the Admi nistrative Expense Fund the amount specified in s uch Written Request of the Community Facilities District as the amount necessary to be transferred thereto in order to have sufficient amounts available th erein to pay Administrative Expenses.
(c) No later than the Business Day immediately preceding each Inter est Payment Date, after having made any requested transfer to the Administrative Ex pense Fund, the Trustee shall withdraw from the Special Tax Fund Net Spe cial Tax Revenues in an amount sufficient to enable the Trustee to make the following transfers in the following order of priority:
449

37 4140-7971-6425.3

(i) Interest Account. To the Interest Account, the amount, if any, necessary to cause the amount on deposit in the Interest Account to be equal to the interest due on the Bonds on such Interest Payment Date;
(ii) Principal Account. To the Principa l Account, the amou nt, if any, necessary to c ause the amount on deposi t in the Principal Ac count to be equal to the principal, if any, due on the Bonds on such Interest Payment Date, including p rincipal due and payable by reason of mandatory sinking fund redemption of such Bonds; and (iii) Reserve Fund . To the Reserve Fund, the am ount, if any, necessary to cause the amount on deposit in the Reserve Fund to be equal to the Reserve Requirement. (d) So long a s the City Facilitie s Account has not b een closed pursuant to Section

3.04(d), on e ach Septe mber 2, after h aving m ade any requested transfer to the Adm inistrative Expense Fund, t he Trust ee shall tran sfer from the Sp ecial Tax Fund to the City Facilities Account any amount remaining in the Special Tax Fund; provided, however, that the Community Facilities District may, in a Written Request of the C ommunity Facilities District submitted to the Trustee prior to such September 2, direct the Trustee to retain in the Special Tax Fund all or a portion of such remaining amount.

Section 5.03. Bond Fund. (a) The Trustee shall establish and maintain a separate Fund designated the “Bond Fund.” Within the Bond Fu nd, the Trustee shall establish and maintain a separate Account designated th e “Principal Account” and a separate Accou nt designated the “Interest Account.” The Trustee shall deposit in the I nterest Account and t he Principal Account from time to time the amounts required to be dep osited therein pursuant to Section 5.02. There shall additionally be deposited in the Interest Account the portion, if any, of the proceeds of the sale of Additional Bonds required to be deposited therein under the Sup plemental I ndenture pursuant to which such Additional Bonds are issued.
(b) In the event that, on the Business Day prior to an Interest Payment Date, after the deposit in the Intere st Acco unt of the amounts r equired to be deposit ed therei n pursuant to Section 5.02, amounts in the Interest Account are insufficient to pay th e interest on the Bonds due and payab le on su ch Interest Payment D ate, the Trustee shall w ithdraw from the Reserv e Fund, to the extent of any funds therein, the amount of such insufficiency, and shall transfer any amounts so withdrawn to the Interest Account.
(c) On each Interest Payme nt Date, th e Trustee shall wi thdraw from the Interest Account for payment to the Owners of the Bonds the interest on the Bonds then due and payable. (d) In the event that, on the Bu siness Day prior t o a September 1 on which principal of the Bonds is due and pa yable, after the de posit in t he Principal Account of the amounts required to be deposited therein pursuant to Section 5.02, including principal due and payable by reason of mandatory sinking fund redemption of the Bonds, amounts in the Principal Account are insuffici ent to p ay such pr incipal, after having withdrawn any amounts from the Reser ve Fund required to be withdrawn therefrom on such date pursuant to subsection (b) of this Section, the Trustee shall withdraw from the Reserve Fund, to the extent of any funds therein, the amount of such insufficiency, and shall transfer any amounts so withdrawn to the Principal Account. 450

38 4140-7971-6425.3

(e) On each Septe mber 1 on which principal of th e Bonds is due and payable, including principal due a nd payable by rea son of mandatory sin king fund r edemption of the Bonds, the Trustee shall withdraw from the Principal Account for payment to the Owners of the Bonds such principal then due and payable.

Section 5.04. Reserve F und. (a) The Trustee shall establish and ma intain a separate Fund designated the “R eserve Fun d.” On the Closing Date, the Trustee shall deposit in the Reserve Fund the amount spe cified in Section 3.0 2. The Tr ustee shall deposit in the Reserv e Fund from time to time the amounts required to be deposited therein pursuant to Section 5.02(c).

There shall additionally be deposited in the Reserve Fund, in conne ction w ith the issuance of Additional Bonds, the amount required to be deposited therein under the Supplemental Indenture pursuant to which such Additional Bonds are issued.
(b) Except as otherwise provided in this Section, amounts in th e Reserve Fund shall be used and withdrawn by the Trustee solely for t he purpos e of (i) ma king transf ers to the Interest Account in accordance with Section 5.03(b) in the event of any deficiency in the Interest Account o f the a mount then requir ed for payment of t he interest on the Bon ds, (ii) making transfers to the Principa l Account in accordance with Se ction 5.03( d) in the event of any deficiency in the Principal Account of the amount then r equired for payment of the principal of the Bonds, and (iii) redeeming Bonds in accordance with the provisions of this Section. (c) Whenever Bonds a re to be opti onally re deemed or r edeemed from Speci al Tax prepayments, a pr oportionate share, determined as prov ided below, of the amount on deposit in the Reserve Fund shall, on the date on which amounts to redeem such Bonds are deposited in the Redemption Fund or oth erwise de posited wit h the Trustee purs uant to S ection 10.02, b e transferred by the Trustee from the Reserve Fund to the Redemption Fund or to such deposit held by the Trus tee and shall b e applied t o the redemption of said Bonds; p rovided, however, that such amount shall be so transferred only if and to the extent tha t the amoun t remaining on deposit in the Reserve Fund will be at l east equal to the Reserve Requirement (excl uding from the calculation thereof said Bo nds to be redeeme d). Such proportionate share shall be equal to the largest integral multiple of the minimum Authorized Denomination for said Bonds that is not larger than the amount equal to the product of (i) the amount on deposit in the Reserve Fund on the date of such transfer, times (ii) a fraction, the numerator of which is the p rincipal amount of Bonds to be so r edeemed and the denominato r of which is the p rincipal amount of Bonds to be Outstanding on the day prior to the date on which such Bonds are to be so redeemed. (d) Whenever t he balance in the Rese rve Fund ex ceeds the amount r equired t o redeem or pay all Outstanding Bonds, including int erest accru ed to th e date of payment or redemption and premium, if any, due upon redemp tion, t he T rustee shall, up on receipt of a Written Request of the Community Facilities District, transfer the amount in the Reserve Fund to the Interest Account, Principal Account and/or Redemption Fund, as applicable, to be applied, on the next succeeding Interest P ayment Date to t he payment and re demption of a ll of the Outstanding Bonds.
(e) If, as a result of the scheduled payment of principal of or interest on the Bonds, the Reserve Requirement is reduced, the Trustee shall transfer an amount equal to the amount of such reduction to the Interest Account.
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Section 5.05. Redemption Fund. (a) The Trustee shall est ablish an d maintain a separate Fund designated the “Redemption Fund.” The Trustee shall deposit in the Redemption Fund (i) amounts rec eived from the Community F acilities Distri ct in connection with the Community Facilities District’s exercise of its rights to optionally redeem Bonds, (ii) the portion of Special Tax prepayments required to b e depo sited th erein pursuant to Section 5.02(a), (iii) amounts re quired to be transferred to the Redemption F und from the Improvement Fu nd (or Accounts therein) pursuant to Section 3.04, (iv) amounts required to be transfer red to the Redemption Fund from the Reserve Fund pursuant to Section 5.04(c) or Section 5.04(d), and (v) amounts required to be deposited therein pursuant to any Supplemental Indenture. (b) Amounts in the Redemption Fund shall be disbursed therefrom for the payment of the Redem ption P rice of Series 2023 Bonds redeemed pursuant to Sect ion 4.0 1(a) or Section

4.01(b) and for the p ayment of the Redemption Price of Additional Bonds redeemed under the Supplemental Indenture p ursuant to which such Additiona l Bonds are issued (other tha n mandatory sinking fund redemptions thereof).

Section 5.06. Rebate Fu nd. (a) The Trustee shall es tablish and m aintain a separate Fund designated the “Rebate Fund.” There shall be deposited in the Rebate Fund such amounts as are required to be deposited therein pursuant to the Tax C ertificate, as specified in a Written Request of the Co mmunity Facilitie s Di strict. A ll money at an y time deposited in the Reba te Fund s hall be h eld by the Tr ustee in trust, to the extent required to satisfy the Re bate Requirement, for payment to the United States of America. Notwithstanding defeasance of the Bonds pursuant to Article X or anything to the contrary contained herein, all amounts required to be de posited into or on deposit in the Rebat e Fund shal l be g overned excl usively by this Section and by the Tax Ce rtificate, which is hereby incorporated here in as if fully set fo rth herein. The Trustee shall be deemed co nclusively to have complied with such pr ovisions if it follows the written directions of the Community Facilities District, and shall have no liability or responsibility to enforce compliance b y the Community Facil ities District with the terms of the Tax C ertificate. The Tr ustee may conclusively rely up on the Comm unity Facilities Dis trict’s determinations, calculations and certifications required by the Tax Certificate. The Trustee shall have no responsibility to in dependently make any calculation or determination or to revi ew the Community Facilities District’s calculations.
(b) Any funds remaining in the Rebate Fund after payment in full of all of the Bonds and after payment of any amounts described in this Section, shall, upon receipt by the Trustee of a Writ ten Request of the Community Facilities District, be withdrawn by the Trustee a nd remitted to the Community Facilities District.

Section 5.07. Administrative Exp ense Fund . (a) The Trustee s hall establish and maintain a separate Fund designated the “Administrative Expense Fund.” [On the Closing Date, the Trustee shall deposit in th e Administrative E xpense Fund the amount specified in Sect ion

3.02.] The T rustee shall deposit in the Administrative Expense Fund the am ounts tra nsferred from the Special Tax Fund and required to be deposited therein pursuant to Section 5.02. (b) The moneys in the Administrative Expense Fund shall be used and withdrawn by the Trustee from time to time to pay the Administrative Expenses upon su bmission of a Written Request of the Com munity Facilities Di strict stating ( i) the Person to whom pay ment is to be 452

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made, (ii) the amount to be paid and instructions for such payment, (iii) the purpose for w hich the ob ligation was inc urred and that such pur pose cons titutes an Administr ative Expense, (iv) that such payment is a proper charge against the Administrative Expense Fund, and (v) that payment of such amount has not been the subject of a pri or disbur sement from the Administrative Expense Fund, in each case together with a statement or invoice for each amount requested thereunder.

Section 5.08. Investment of Moneys . (a) Except as otherwis e provided herein, all moneys in any of the Funds or Accounts established pursuant to this Indenture held by the Trustee shall be invested by the Trustee solely in Permitted Investments, as directed in a Written Request of the Community Facilities District received by the Trustee no later than two Business Days prior to the maki ng of s uch investment. Moneys in all such Funds and Accounts shall be invested in Permitted Investments maturing not later than the date on whi ch it is estimated that such moneys will be required for the purposes s pecified in this Inde nture; provided, however, that Permitted Investments in which moneys in the Reserve Fund are so invested shall mature no later than the earlier of five years from t he date of investment or the final maturity date of the Bonds and, provided, further, that if such Permitted Investments may be redeemed at par so as to be available on each Interest Payment Date, any amount in the Reserve Fund may be invested in such redeemable Permitted Investments maturing on any date on or prior to the final maturity date of the Bonds. Absent a t imely Written Request of th e Community Facilities District with respect to the investment of moneys in any of the Funds or Accounts established pursuant to this Indenture held by the Trustee, t he Tr ustee s hall invest such moneys in Per mitted In vestments described in paragraph (7) of the definition thereof; provided, however, that any such investment shall be made by the Trustee only if, prior to the date on which such inves tment is to be made, the Tr ustee s hall have received a Written R equest of the Communi ty Faci lities Di strict specifying a specific money market f und that satisfies the requirements of said paragra ph in which such investment is to be made and, i f no such Wri tten Reques t of the Community Facilities District is so received, the Trustee shall hold such moneys uninvested. (b) Subject to the provisi ons of Se ction 5.06, all interes t, profits a nd other income received from the investment of m oneys in any Fund or Account established pursuant to th is Indenture (other than the Reserve Fund) shall be retain ed ther ein. Subject to the provisions of Section 5.06, all interest, profits or other income received from the investment of moneys in the Reserve Fund shall be transferred to the Interest Account; p rovided, ho wever, that, notwithstanding the foregoing, any such transfer shall be mad e from the Reserve Fund only if and to t he extent that, after such transfer, the am ount on deposit in the Rese rve Fund is at least equal to the Reserve Requirement.
(c) Permitted Investm ents acquired as an investment o f moneys in any Fund or Account established under this Ind enture shal l be credited to such Fund or Account . For the purpose of determining the amount in any Fund or Account , all Permitted Investments credited to s uch Fund or Accoun t shall b e valued by the Trustee at the market value th ereof, such valuation to be performed not less frequ ently than semiannually on or before each F ebruary 15 and August 15. In determining the market value of Permitted Investments, the Trustee may use and rely upon generally recognized pricing information services, including brokers and dealers in securities, available to it.
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(d) The Trustee may act as pr incipal or agent in the mak ing or disposing of an y investment. Upon the Written Request of the Community Facilities District, the Trustee shall sell or present for redemption any Permitted Investments so purchased whenever it shall be necessary to provide moneys to meet any required payment, transfer, withdrawal or disbursement from the Fund or Account to which such Permitted Investments are credited, and the Truste e shall not be liable or responsible for any loss resulting from any investment made or sold pursuant to this Section. For purposes of investment, the Trustee may c ommingle moneys in any of th e Funds and Accounts established h ereunder. The Trustee, in mak ing or di sposing of a ny inve stment permitted by this Section, may deal with itse lf (in its individual ca pacity) or with any one or more of its affiliates, whether it or such affiliate is actin g as an agent of the Trustee or for any third person or dealing as a prin cipal for it s own a ccount bu t only if s uch dealing i s n ot in conflict with, contrary to or in v iolation of any of the Trus tee’s fiduciary obligations as Trustee hereunder.
(e) The Community Facilities District acknowledges that to the extent regulatio ns of the Comptroller of the Currency or other a pplicable reg ulatory en tity gran t the Community Facilities Di strict the right to re ceive b rokerage confirmations of security transactions as the y occur, at no additional cost, the Community Facilities District specifically waives receipt of such confirmations to the extent permitted by law. The Trustee shall furnish the Community Facilities District periodic cash transa ction st atements, which shal l inclu de d etail for a ll in vestment transactions made by the Trustee hereunder.
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ARTICLE VI

COVENANTS
Section 6.01. Collection of Spec ial Tax Reven ues. (a) The Community Facil ities District shall comply with a ll requirements of the Act so as t o assure the timely collection of Special Tax Revenues, including the enforcement of delinquent Special Tax payments. (b) Prior to August 1 of each year, the Communi ty Facilities District shall as certain from the County Assessor the relevant parcels on which the Special Tax is to be levied, taking into a ccount any parcel splits during the pr eceding and t hen current year. T he Commun ity Facilities District shall effect the levy of the Special Tax each Fiscal Year in accordance with the Ordinance by each August 10, or otherwise such t hat the computation of the levy is complete before the final date on which the County Auditor will accept the transmission of the Special Tax amounts for the parcels wi thin the Community Facilities District for inclusion on th e next real property tax roll. Upon the c ompletion o f the computation of the amounts of the levy, the Community Fac ilities District shall prep are or caus e t o be prep ared, and shall transmit to the County A uditor, such data as the Co unty Auditor re quires in order t o i nclude the levy of the Special Tax on the next real property tax roll.
(c) The Community Facilities District shall fix and levy the Special Tax within the Community Facilities District in each Fiscal Year in accordance with the Rate and Method and, subject to the limitations in the Rate and Method as to the maximum Special Tax that may be levied on each parcel, in an amount su fficient to yield Speci al Tax Reve nues in t he amount required for (i) the payment of principal of and interest on any Outstanding Bonds becoming due and pa yable during the Corresponding Bond Year, ( ii) any necessary re plenishment of the Reserve Fund, and (iii) the payment of Administrative Expenses estimated to be paid fr om such Special Tax Revenue s, taking into account the balances in t he Funds and Accounts established hereunder.
(d) The Special Tax shall be payable and be collected in the sa me manner and at the same time and in the same installment as the general taxes on real property are payable ( or in such other manner as the Cit y Council shall determine, including direct billing of the affected property owners), and ha ve the s ame priority , become del inquent at the same time and in the same propor tionate amounts and bear the s ame p roportionate pen alties and interest after delinquency as do the ad valorem taxes on real property.

Section 6.02. Foreclosure. Pursuant to Section 53356. 1 of the Act, the Co mmunity Facilities District hereby covenants with and for the benefit of the Owners that it will determine or cause to be determined, no later t han August 15 o f each year, whether or not any owners of property within the Community Facil ities District are d elinquent in the payment of the Special Tax levied thereon and, if such delinquencies exist, the Community Facilities District will order and c ause t o be comme nced no la ter than O ctober 1, and therea fter diligently prosecute, an action in the superior court to foreclose the lien of the Special Tax or installment thereof not paid when due; prov ided, how ever, t hat the Community Fa cilities District s hall not be req uired to order the c ommencement of foreclosure proceedings if (a) the total Special Tax delinquency in the Community Facilities District for such Fiscal Year is l ess than 5% of the total amount of the 455

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Special Tax levied in such Fiscal Year, and (b) the amount then on deposit in the Reserve Fund is equal to the Reserve Requirement. Notwithstanding the foregoing, if the Community Facilities District determines that any single parcel in the Community Facilities District is delinquent in excess of $7,500 in the payment of the Special Tax, then the Community Facilities District shall diligently institute, prosecute and pursue foreclosure proceedings against such parcel.

Section 6.03. Compliance with A ct. The Community Fac ilities District sha ll comply with all applicable provisions of the Act.

Section 6.04. Punctual Payment. The C ommunity Facilities District shall punctually pay or cause to be paid the principal, premium, if any, and interest to become due in r espect of all the Bonds, in strict conformity with the terms of the Bonds and of this Indenture, according to the true intent and meaning thereof, but only out of Net Special Tax Reven ues and other assets pledged for such payment as provided in th is Indent ure and received by the Community Facilities District or the Trustee.

Section 6.05. Extension of Payment of Bonds. The Community Facilities District shall not directly or indirectly extend or as sent to the extension of the maturity of any of the Bonds or the time of payment of any claims for interest by the purchase of such Bonds or by any other arrangement, and in cas e the maturity of any of t he Bonds or the time of payment of any such claims for interest shall be extended, such Bonds or claims for interest shall not be entitled, in case of any default hereu nder, to the be nefits of this Indenture, except su bject to the prior payment in full of the principal of all of the Bonds then Outstanding and of all claims for interest thereon that shall not have been so extended. Nothing in this Section shall be deemed to limit the right of t he Com munity Facilities Di strict to is sue Bon ds for the purpose of refunding any Outstanding Bonds in accordance with the provisio ns here of, and s uch issuance shall not be deemed to constitute an extension of maturity of the Bonds.

Section 6.06. Against Encumbrances; Defense of Pledge. The Community Facilities District shall not create, or permit the creation of, any pledge of, li en on, securi ty interest in o r charge or other encumbrance upon the assets pledged under this I ndenture, except as permitted hereby. The Community Facilities Distric t shall at a ll time s, to the e xtent pe rmitted by law, defend, preserve and protect said pledge of such assets, and the lien thereon and security interest therein created hereby, against all claims and demands of all Persons whomsoever.

Section 6.07. Tax Covenants. (a) The Community Facilities District shall not take any action, or fail to ta ke any action , if such action or failure to take such action wo uld adversely affect the exclusion from gross income of interest on the Series 2023 Bonds under Section 103 of the Code. Without lim iting th e g enerality of the foregoing, the Community Faciliti es District shall comply with the requirements of the Tax Certificate, which is incorporated herein as if fully set forth h erein. This covenant shall survive payment in full or defeasance of the Series 2023 Bonds.
(b) In the e vent that at any time the Communit y Facilities District is of t he opinion that for purposes of th is Sectio n it is necessary or he lpful to res trict or limit t he yiel d on the investment of any moneys h eld by the T rustee in any of t he Funds or Accounts established 456

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hereunder, the Community Fac ilities Distr ict sha ll so ins truct the Trustee in writing, and the Trustee shall take such action as may be necessary in accordance with such instructions. (c) Notwithstanding any p rovisions of this Section, if the Community F acilities District shall provide t o the Trustee an opinion of B ond Counsel to the effect that any specified action required under this Section is no longer required or that some further or different action is required to maintain the exclusion from federal income tax of interest on the Series 2023 Bonds, the Trustee may conclusively rely on such opini on in com plying with the require ments of thi s Section and of the Tax Certificate, and the covenants he reunder shall be deemed to be modified to that extent.

Section 6.08. Non-Cash Payments of Special Tax . The Community Facilities District shall not authorize owner s of taxable parcels within the Community Facilities District to satisfy Special Tax ob ligations by th e tender of Bo nds unless th e C ommunity Facilities District shall have first obtained a repor t of an Inde pendent Consultant certifying that doing so would not result in the Community Facilities District having insufficient Special Tax Revenues to pay the principal of and interest on all Outstanding Bonds when due.

Section 6.09. Reduction in Special Tax . The Community Facilities Dist rict shall not initiate proceedings under the Act to modify the Ra te and Method if such mo dification would adversely affect the security for the Bonds. If an initiative is adopted that purports to modify the Rate and Method in a manner that would adversely affect the security for the Bonds , the Community Facilities Distr ict shall, t o the extent permitted by law, commence and p ursue reasonable leg al actions to p revent the mod ification of the Rate and Method in a manner that would adversely affect the security for the Bonds.

Section 6.10. Continuing Dis closure. Each of the Community Facilities District and the Trustee shall comply with and carry out a ll of t he provisions of the Continuing Disclosure Agreement applicable to it. Notwithstandin g any other provision of this Indenture, failure of the Community Facil ities District or the T rustee to co mply with th e Continuing Disclosure Agreement shall not be considered an Event of Default; provided, however, that the Trustee may (and, at the writte n d irection of any Participating Underwriter or the Owners of at least 25% aggregate principal amount of O utstanding Series 2023 Bonds, and up on receipt of indemnification reasonably satisfactory to the Trustee, shall) or any Owner or Beneficial Owner of the Series 2023 Bonds may, take such actions as may be necessar y and appropriate to compel performance, including seeking mandate or specific performance by court order.

Section 6.11. Accounting Records. The Com munity Facilities Dis trict shall keep or cause to be kep t appropriate accounting records in which complete and correct entries shall be made of all tr ansactions r elating to t he Special Tax, which records sha ll be avail able for inspection by the Trustee at reasonable hours and under reasonable conditions.

Section 6.12. State Reporting. If at any time principal or interest due on a ny scheduled payment date for the Bonds is not paid, or if funds are withdrawn from the Reserve Fund to pay principal of or interest on the Bonds, the Trustee shall notify the Community Facilities District in writing of su ch failure or withdrawal, and the Community Facilities District sh all notify t he 457

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California Debt and Investment Advisory Commission of s uch failure or wit hdrawal within ten days of the failure to make such payment or the date of such withdrawal.

Section 6.13. Annual R eports to the California Debt and Investment Advisory Commission. Not later than October 30 of each year, commencing Octobe r 30, 2024 and continuing unt il t he Octob er 30 fo llowing the final m aturity of the Bonds, the Community Facilities District shall s upply to the California Debt and I nvestment Advisory Commission the information required to be provided thereto pursuant to S ection 5335 9.5(b) of the Act. Such information sh all be made available to any O wner upon written reques t to the Com munity Facilities District accompanied by a fee de termined by the Community Facilities District to pay the costs of the Community Facilities District in connection therewith. The Community Facilities District shall in no event be liable to any Owner or any other person or entity in connection with any error in any such information.

Section 6.14. Further Assura nces. The Co mmunity F acilities District shall make, execute and d eliver any and all such further agreements, instruments and assurances as may be reasonably necessary or proper to carry out the intention or to facilitate the performance of th is Indenture and for the b etter assuring and confirming unto the Owner s of the rights and benefits provided in this Indenture.
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ARTICLE VII

EVENTS OF DEFAULT AND REMEDIES
Section 7.01. Events of Default. The following events shall be Events of Default:
(a) failure to pay any insta llment of pr incipal of any Bonds when and as the same shall become due and paya ble, whet her at matur ity as t herein expressed, b y proceedings for redemption or otherwise;
(b) failure to pay any i nstallment of interest on any Bond s when and as the same shall become due and payable;
(c) failure by the Community Facilities District to observe and perform any of the other covenants, agreements or conditions on its part in this Indenture or in the Bonds contained, if such failure shall have continued for a period of 30 days after written notice thereof, specifying such failure and requiring the same to be r emedied, shall have been given to the Community Facilities District by the Trustee, or to the Community Facilities District and the Trustee by the Owners of not less than 5% in aggregate principal amount of the Bonds at the tim e Outstandi ng; provided, howe ver, that, i f in the reasonable opinion of t he Community Facilities Distri ct th e failu re stat ed in the notice can be corrected, but not within such 30 day period, such failure shall not constitute an Event of Default if corrective action is instituted by the Community Facilities District within such 30 day period and the Communi ty Fa cilities District shall thereafter diligently and in good faith cure such failure in a reasonable period of time, provided, further, that, unless otherwise consented to by the Trustee, such period of time shall not exceed 180 days; or (d) the commencement by t he Comm unity F acilities District of a voluntary case under Title 11 of the United States Code or any substitute or successor statute.

Section 7.02. Foreclosure. If an Ev ent of De fault shall occur under Section 7.01(a) or Section 7.01(b) then, and in each and ev ery such case during the con tinuance of such Event of Default, the Trustee may, or at the written direction of the Owners of not less than a majority in aggregate principal amount of the Bonds at the time Outstanding, and upon being indemnified to its sati sfaction the refor, shall, co mmence foreclosure against any par cels of l and in the Community Fa cilities Dis trict delinquent in the payment of the Special Tax, as provided in Section 53356.1 of the Act; provided, however, that the Trustee shall not be required to pursue a foreclosure action against any such parcel if the Trustee woul d be required to take title to, or an ownership interest in, such parcel in connection with or as a result of such foreclosure action.

Section 7.03. Other Remedies. If a n Event of Default shall have occur red and be continuing, the Trustee shall have the right:
(a) by ma ndamus, s uit, action or proceedi ng, to comp el the Community Facilities District and its officers, agents or employees to perform each and every term, provision and covenant contained i n this Ind enture and i n the Bonds, and to require the carrying out of an y or a ll such covenants and agre ements of t he Community Faci lities District and the fulfillment of all duties imposed upon it by this Indenture and the Act; 459

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(b) by suit, action or proceeding in equity, to enjoin any acts or things that are unlawful, or the violation of any of the rights of the Trustee or the Owners; or (c) by su it, action or proceeding in an y cou rt of competent jurisdiction, to require the Community Facilities District and its officers and employees to account as if it and they were the trustees of an express trust.

Section 7.04. Remedies Not Exclusive. No remedy he rein conferred upon or reserved to the Trustee or to the Owners is intended to be exclusive of any other remedy or remedies, and each and every such remedy, to the extent permitted by law, shall b e cumulative and in addition to any other r emedy given hereu nder or now or h ereafter existing at law o r in equity or otherwise.

Section 7.05. Application of Net Special Tax Revenues After Default. If an Event of Default sha ll occur and be continuing, all Net Special Tax Re venues and any other fund s thereafter received by the Trustee under any of the provisions of this Indenture shall be applied by the Trustee as follows and in the following order:
(a) to the p ayment of an y expenses incurred by the Trustee necessary in th e opinion of the Trustee to prot ect the int erests of the Own ers and payment of reasonable fees, charges and expenses o f the Trustee (including reasonable fees and disbursements of its counsel) incurred in and about the performance of its powers and duties under this Indenture;
(b) to the pay ment of the principal and in terest then due with respect to the Bonds (upon presentation of the Bonds to be paid, and stamping thereon of the payment if only partially paid, or surrender thereof if fully paid) subject to the provisions of this Indenture, as follows:

First: to the pa yment to the Persons entitled thereto of all installments of interest on the Bonds then due in the order of the maturity of such installments and, if the amount a vailable shall not be sufficient t o pay i n full any installment or installments maturing on th e same date, then to t he payment thereof r atably, according to the amounts due t hereon, to the Persons entitled thereto, without any discrimination or preference; and
Second: to the payment to the Persons entitled thereto of all installments of principal of the Bonds then due, whether at maturity or by call for redemption, with interest on the overdue principal at t he rate bor ne by the respective Bonds on the date of maturity or redemption, and, if the amount available shall not be sufficient to pay in ful l all the Bonds, together with such i nterest, then to the payment thereof ratably, according to the amounts of pr incipal due on such d ate to the P ersons entitled thereto, without any discrimination or preference; (c) any remaining funds shall be transferred by the Trustee to the Special Tax Fund.
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Section 7.06. Power of Trustee to Enforce. All rights of action under this Indenture or the Bonds or otherwise may be prosecuted and enforced by the Trustee without the possession of any of the Bonds or the production thereof in any proceeding relating thereto, and any such suit, action or proceeding instituted by the Trustee shall be brought in the name of the Trustee for the benefit and protection of the Owners of such Bonds, subject to the provisions of this Indenture.

Nothing herein shall be deemed to authorize the Trustee to author ize or consent to or a ccept or adopt on b ehalf of any O wner any pl an of reor ganization, arrangement, adjustment, or composition affecting the Bonds or the rights of any O wner thereof, or to authoriz e the Trustee to vote in respect of t he claim of any Owner in any such proceeding without the approval of the Owners so affected.

Section 7.07. Owners’ Direct ion of Proceedings. Anything in this Indenture t o the contrary notwithstanding, the Owners of a majority in aggregate principal amount of the Bon ds then Outstanding s hall h ave the right, b y a n instrument or concurrent ins truments in writing executed and delivered to the Trustee, and upon indemnification of the Trustee to its reasonable satisfaction, to direct th e method of conducting all remedial p roceedings taken by t he Trustee hereunder; provided, however, that such direction shall not be otherwise than in accordance with the provisions of this Indentu re, the Act and other applicable law and, provided, further, that the Trustee shall have the righ t to decline to follo w a ny such dir ection that in the opinion of t he Trustee would be unjustly prejudicial to Owners not parties to such direction.

Section 7.08. Limitation on Owners’ Right to Sue. No Owner of any Bond shall have the r ight to i nstitute any suit, act ion or proceeding at law o r in equity, for the protection or enforcement of any right or remedy under this I ndenture, the Act or any other applicable law with respect to such Bond, unless (a ) such Owner shall have given to the Trustee written notice of the occurrence of an Ev ent of Default, (b) th e Owners of a majority i n aggregate principal amount o f the Bonds then Ou tstanding shall have made written request u pon the Trustee to exercise the powers hereinbefore granted or to institute such suit, action or proceeding in its own name, (c) such Owner or said Owners shall have tendered to the Tr ustee indemnity reasonably satisfactory to the Trustee against the costs, expenses and liabilities to be incurred in compliance with such request, and (d) the Trustee shall have refused or omitted to comply with such request for a period of 60 days after such written request shall have been received by, and said tender of indemnity shall have been made to, the Trustee.

Such notification, request, tender of indemnity and refusal or omission are hereby declared, in every case, to be conditions precedent to the exercise by any Owner of any remedy hereunder or under law; it being understood and intended that no one or more Owners shall have any right in any manner whatever by such Owner’s or Owners’ action to affect, disturb or prejudice the security of this Indenture or the rights o f any other O wners, or to enforce any right under the Bonds, this Indenture, the Act or other applicable law with respect to the Bonds, except in the manner herein provided, and that all proceedings at law or in equity to enforce any such right shall be instituted, had and maintained in the manner herein provided and for the benefit and protection of all Owners, subject to the provisions of this Indenture.

Section 7.09. Absolute Obl igation. Nothing in this Indenture or t he Bo nds contained shall affect or impair the o bligation of the Community Facilities District, wh ich is a bsolute and unconditional, to pay t he principal of a nd interest on the Bonds to the respec tive Owners as the 461

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same become due, as herein provided, but o nly out of the Net Specia l Tax Reve nues and oth er assets pledged therefor hereunder, or affect or impair the right of such Owners , which is also absolute and unconditional, to enforce such paymen t by virtue of the c ontract embodied in th e Bonds.

Section 7.10. Termination o f Proceedings . In case any p roceedings t aken by the Trustee or any one or more Owners on a ccount o f any Event of Default s hall have been discontinued or abandoned for any reason or shall have been determined adversely to the Trustee or the Owners, then in every such case th e Communit y Facilities District, the Trustee and the Owners, subject to any dete rmination in such procee dings, sha ll be restored to their f ormer positions and rights here under, severally and respectively, and all rights, remedies, powers and duties of the Community Facilities District, the Trustee and the Owners shall continue as though no such proceedings had been taken.

Section 7.11. No Waiver o f Default. No delay or omission of t he T rustee or of any Owner to exercise any right or power ari sing upon the occurrence of any def ault or Even t of Default shall impair any such right or power or shall be construed to be a wa iver of an y such default or Event of Default or an acquiescence therein, and every pow er and remedy given by this Indenture to the Trustee or to the Owners may be exercised from time to time and as often as may be deemed expedient.
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ARTICLE VIII

TRUSTEE
Section 8.01. Duties and Liabilities of Trustee. The Trustee shall, prior to an Event of Default, and after the curing or waiver of all Events of Default that may have occurred, perform such duties and only such duties as are expressly and specifi cally set forth in this Indenture. The Trustee shall, during the existence of any Event of Default that has not been cured or waived, exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent person w ould exerc ise or use under t he circumstances in the conduct of such person’s own affairs.

Section 8.02. Qualifications; Removal and Resignation; Successors. (a) The Trustee initially a party hereto and any successor there to shall at all times be a trust company, national banking association or bank having trust powers i n good standing in or incorporated under the laws of the Un ited States or any state thereof, w hich is (or if such trust c ompany, national banking associatio n or bank is a member of a bank holding co mpany s ystem, its parent bank holding company is) (i) a nation al banking a ssociation that i s supervised by t he Office of the Comptroller o f the Curren cy and has a t l east $250 million of assets, or (ii) a state -chartered commercial bank that i s a member of the Federal Reserve System and has at least $1 billion of assets. If such trust comp any, national banki ng as sociation or bank pu blishes a report of condition at l east annually, pursuant to law or to t he requir ements of any supervisi ng or examining agency above referred to, then for the purpose of this subsection the combined capital and surplus of such trust company, national banking association or bank shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. (b) The Community Facilities District may, by an instrument in writing, upon at least 30 da ys’ n otice to the Trustee , remove t he Trustee i nitially a p arty hereto and any successor thereto unless an Event of Default shall have occurred and then be continuing, and shall remove the Trustee initially a party hereto and any successor thereto if (i) at any time requested to do so by an instrument or concurrent instruments in writing signed by the Owners of not less than a majority in agg regate principal amount of the Bonds then Outstanding (or their attorneys duly authorized in writing), or (ii) the Trustee shall cease to be e ligible in accordance with subsection (a) of this Section, or shall beco me incapa ble of acting, or shall be adjudg ed a ba nkrupt or insolvent, or a receiver of the Trustee o r its property shall be appointed, or an y public officer shall t ake control or charg e of the T rustee or of its pr operty o r affairs for the purpose of rehabilitation, conservation or liquidation, in each case by giving written notice of such removal to the Trustee.
(c) The Trustee may at any time resign by giving written notice of such resigna tion by first-class mail, postage prepaid, to the Community Facilities D istrict, and to the Owners at the respective addresses shown on the Registration Books. In case at a ny time the Truste e shall cease to be el igible in accordance with the provisions of subsection (a) of this Section, th e Trustee shall resign immediately in the manner and with the effect specified in this Section. (d) Upon removal or resignation of the Trustee , the Community Fa cilities Dis trict shall p romptly appoint a successor Trustee by an instrument in writing . Any r emoval o r 463

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resignation of the Trustee and ap pointment of a successor Trustee shall become effective upon acceptance of a ppointment by the succes sor Trustee; provi ded, h owever, that any successor Trustee shall be qualified as pro vided in subsection (a) of this Section. If no qualified successor Trustee shall have been appointed and have acce pted ap pointment w ithin 45 days following notice of removal or notice of resignation as aforesaid, the removed or resigning Trustee or any Owner (on beh alf of such Owner a nd al l o ther Owners) may petition any court of compe tent jurisdiction for the appointment of a successor Trustee, and such court may thereupon, after such notice, i f a ny, as it may de em proper, appoint such successor Trustee. A ny success or Trustee appointed under this Indenture shall signify its acceptance of such appointment by executing and delivering to the C ommunity Facilities District and to its predecessor T rustee a wri tten acceptance t hereof, and thereupon such successor Trustee, w ithout any f urther act, deed or conveyance, shall become veste d with all the moneys, estates, properties, rights, powers, trusts, duties and obligations of such predecessor Trustee, with like effect as if originally named Trustee herein; but, nev ertheless at the Writt en Requ est o f t he Community Facilities District or the request of the successor Tr ustee, such predecessor Trustee shall execute and deliver any and al l instruments of c onveyance or further assurance and do such other things as may rea sonably be required for more fully and certainly vesting in and confirmi ng to such successor Trustee all the right, title and interest of such predecessor Trustee in and to any property held by it under this Indenture and shall pay over, transfer, assign a nd deliver to the successor Trustee any money or other property subject to the tr usts and conditions her ein set fo rth. Up on acceptan ce of appointment by a successor Trustee as provided in th is subsection, the successor Trustee shall, within 15 days after s uch acceptance, mail, by first-class mail postage prepaid, a notice of t he succession of such Trustee to the trusts hereunder to the Owners at the addresses shown on the Registration Books.
(e) Any trust company, national banking association or bank into which the Trustee may be merged or converted or with which it may be consolidated or any trust company, national banking association or b ank resulting from any merger, conversion or consolidation to which it shall be a party or any trust company, national banking association or bank to which the Trustee may sell or transfer all or substantially all of its corpora te trust b usiness, provided such trust company, national banking ass ociation or bank s hall b e eligible under subsection (a) of this Section, shall be th e successor to such Tr ustee, without the execution or filing of any pape r or any further act, anything herein to the contrary notwithstanding.

Section 8.03. Liability of Trustee . (a) The recitals of facts here in and in the Bonds contained shall be taken as statements of the Community Facilities District, and the Trustee shall not assume responsibility for the correctness of the same or incur any responsibility in respect thereof, other tha n a s e xpressly stated herein in connection with the respective dut ies or obligations herein or in the Bonds assigned to or imposed upon it. The Trustee shall, however, be responsible for its representations contained in its certificate of authentication on the Bonds. (b) The Trust ee makes no representations as to the validi ty or suff iciency of t his Indenture or of any Bonds, or in respect of the security afforded by this Indenture and the Trustee shall incur no responsibility in respect there of. The Trustee sh all be under no responsibility or duty with respect to the issuanc e of the B onds for value, the application of the proceeds thereof except to the e xtent that such proceed s are rece ived by it in its capacity as Trustee, or the 464

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application of any moneys paid to the Community Facilities District or others in accordance with this Indenture.
(c) The Trustee shall not be liable in connection with the performance of its duties hereunder, except for its own negligence or willful misconduct. (d) No provision of this Indenture or any other document related hereto shall require the Trustee to risk or advance its own funds.
(e) The Trustee may execute any of its p owers or duties hereunder through attorneys, agents or recei vers and shall n ot b e answerable for the actions of such a ttorneys, ag ents or receivers if selected by it with reasonable care.
(f) The Trustee shall not be liable for any error of judgment made in go od faith by a responsible officer, unless it shall be proved that the Trustee was negligent in ascer taining the pertinent facts.
(g) The immunities and protections extended to the Trustee also exten d to its directors, officers, employees and agents.
(h) Before taking action under Article VII, under this Article or upon the direction of the Ow ners, the Trustee ma y require indemnit y reasonably satisfactory to the Trustee be furnished to it to pro tect it ag ainst all fe es and expenses, including those of its attorneys and advisors, and protect it against all liability it may incur. (i) The Trustee shall not be liable wit h respect to any a ction taken or omitted to be taken by it in go od faith in accordan ce with th e direction of the Owners o f not less than a majority in aggregate principal amount of the Bonds at the time Outstanding relating to the time, method and place of conducting any pr oceeding for any remed y a vailable to the Trustee, or exercising any trust or power conferred upon the Trustee under this Indenture. (j) The Trustee may become the Owner of Bo nds with the same rights it would have if it were not Trustee and, t o the extent permitted by law, may act a s depository for and permit any of its officers or directors to act as a member of, or in any other capacity with respect to, any committee formed to protect the rights of Owners, whether or not such committee shall represent the Owners of a majority in aggregate principal amount of the Bonds then Outstanding. (k) The Truste e shall have no responsibility with respect to any information, statement, or reci tal in any official statemen t, offering memorandum or any other disc losure material prepared or distributed with respect to the Bonds. (l) The Trustee shall not be li able for the failure to take any action required to be taken by it hereunder if and to the ext ent that t he Trustee’s taking such action is prevented by reason of an act of God, ter rorism, war, riot, strike, fire, flood, earthquake, epidemic or ot her, similar occurrence that is beyond the control of the Trustee and co uld not have been avoided by exercising due care.
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(m) The Truste e shall not be d eemed to have knowledge of an Event of Def ault hereunder unless it has actual knowledge thereof.
(n) The permissive right of the Trustee to do things enumerated in this Indenture shall not be construed as a duty and it shall not be answerable for other than its negligence or willful misconduct.
(o) The Tr ustee shall not be res ponsible for or acc ountable to anyone for th e subsequent use or ap plication of any moneys that shall be released or withdrawn in accordance with the provisions hereof.

Section 8.04. Right to Re ly on Documents and Opinions . (a) The Trustee shal l be protected i n acting upo n any notice, resolution, request, requisition, facsimile, c onsent, order, certificate, report, opinion, bond or other paper or d ocument believed by it to be genuine and to have been signed or presented by the proper party or parties. Each statement of facts contained in a Written Request o f the Commun ity Fac ilities D istrict or a Written Certificate o f the Community Facilities District shall be sufficient evidence to the Trustee of the facts so stated and the Trustee shall have no duty to confirm the accuracy of such facts. (b) The Trustee shall have the ri ght to accept and act upon a Written Request of th e Community Facilities District delivered using El ectronic M eans. If the Community Facilities District elects to deliv er a Written Request of the Community Facilities District to the T rustee using Electroni c Means and t he Trustee acts upon such Written Req uest, the Trustee’s understanding of such Written Request shall be deemed controlling. The Community Facilities District understands and agrees that the Trustee cannot determine the identity of the actual sender of such Written Request and that the Trustee shall conclusively presume that Written Requests of the Community Facilities District that purport to have been sent by an Authorized Representative of the Co mmunity Facilities Distri ct have be en sent by s uch Aut horized R epresentative. The Community Facil ities Dis trict shall be responsi ble for en suring t hat only A uthorized Representatives transmit such W ritten Requests o f t he Community Facilities District to th e Trustee and that the Co mmunity Facilities District is solely responsible to safeguard the use a nd confidentiality of applicable user and authorization codes, passwords and/or authentication keys upon receipt thereof by the Community Facilities District. The Trustee shall not be liable for any losses, costs or exp enses arising directly or indirectly from the Trustee’s reliance upon and compliance wi th such Wr itten Requests o f the Community Facilitie s District delive red using Electronic Means notwithstanding such directions conflict or are i nconsistent with a subsequent written Written Requests of the Community Facilities District. The Community Facilities District agrees (i) to as sume all risks arisi ng out of the use of Electronic Means t o s ubmit Written Requests of the Community F acilities District to the Trustee, including the risk of the Trustee acting on un authorized Written Requ ests of th e Community Facilities District, a nd th e risk of interception and misuse by third parties, (ii) that it is fully informed of the protections a nd risks associated wi th the various m ethods of transmitting Written Req uests of the Community Facilities District to the Trustee an d that there may be m ore secure methods o f transmitting Written Requests of the Community Facilities District than the metho d selected by the Community F acilities District, (iii) that the security procedures, if any, to be follo wed in connection with its t ransmission of W ritten Requests of the Co mmunity Facilitie s D istrict provide to it a commercially reasonable degree of prote ction in l ight of its particular needs and 466

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circumstances, and (iv) to no tify the Trustee immediately upo n learning of any compromise or unauthorized use of the security proc edures. Notwithst anding the fo regoing, the provisions of this subsection, and the Trustee’s actions pursuant hereto, are subject to the Trustee’s standard of care and limitations on liabi lity set f orth in Sections 8.03 and 8.04; provided, however, that the Trustee’s relian ce on a Written Request o f the Community Facilities District that purports t o have been sent by an Authorized Representative of the Commun ity Facilities District delivered in accordance with this Section using Electronic Means shall not, in and of itself, be construed as negligence.
(c) Whenever in t he administration of the duties imposed upon it by thi s Indenture the Trustee shall deem it neces sary or d esirable that a matter be proved or established prior to taking or suffering any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may be de emed to be conclusively proved and established by a Written Certificate of the Com munity Facilities District, and su ch Written Certificate shall be full warrant to the Trustee for any action taken or suffered in good faith under the p rovisions of this Indenture in reliance upon such Written Certificate, b ut in its discretion the Trustee may, in lieu thereof, accept other evidence of such matter or may re quire such additional evidence as it may deem reasonable.
(d) The Trustee may consult w ith counse l, who may b e counsel to the Community Facilities District, with regard to legal questions, including with respect to comp liance herewith of amendments hereto, and the opinion of such counsel shall be full and complete authorization and protectio n in respe ct of any ac tion ta ken or suffered by it hereunder in good fai th and in accordance therewith.

Section 8.05. Accounting Records and Financial Statements. The Trustee shall at all times keep, or cause to be kept, proper books of record and account, prepared in accordance with prudent co rporate t rust industry standards, in which accurate entries shall be made o f all transactions made by it relating to the proceeds of the Bonds, the Special Tax Revenues received by it and all Funds and Accounts established by i t pursuant to this Ind enture. Such books of record and account shall be available for inspection by the Community Facilities District during regular business hours and upon reasonable notice and under reasonable circumstances as agreed to by the Trustee. T he Trustee shall deliv er to t he Com munity Facilities District a monthly accounting of the Funds and Accounts it holds under this Indenture; provided, however, that the Trustee shall not be o bligated to d eliver an accounting for any Fund or Account that (a) has a balance of zero, and (b) has not had any activity since the last reporting date.

Section 8.06. Preservation and Inspection of Documents. All documents received by the Trustee under the provisions of this Indenture shall be retained in its possession and shall be subject during bus iness h ours and upon reasonable notice to the insp ection of the Community Facilities District, the Owners and their agents and representatives duly authorized in writing.

Section 8.07. Compensation and Indemnification. The Community Facilities District shall pay to the Tru stee f rom time to time from Special Tax Rev enues all reasonable compensation pursuant to a pre-approved fee letter for all services rendered under this Indenture, and also all reasonable expenses, charges, legal and consulting fees pursuant to a pre -approved fee letter and other disbursements pursuant to a pre-approved fee letter and those of its attorneys, 467

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agents and employees, incurred in and ab out the performance of their powers and duties under this Indenture. The Community Facilities District sh all, to the e xtent permitted by law, from Special Tax Revenues, indemnify and save the Trustee and its officers, directors and employees harmless again st any costs, suits, judgments, damages, l iabilities, claims, e xpenses, including legal fees and expenses, and liabilities that it may incur in the exerci se and pe rformance of its powers and duties hereunder, including the enforcement of any remedies and t he defense of any suit, and that are not due to its negligence or its willful mis conduct. The duty of the Community Facilities District to indemnify the Trustee shall survive the resignation or removal of the Trustee and the discharge and satisfaction of this Indenture.
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ARTICLE IX

SUPPLEMENTAL INDENTURES
Section 9.01. Supplemental Indentures. (a) This Indenture and the rights and obligations of the Community Fa cilities District, the Trustee a nd the Owners hereunder may be modified or amended from time to time a nd at any time by a Supplemental Indenture, which the Community Facilities Distric t and the Trustee may enter i nto when there are submitted to the Trustee the written consents of the Owners of a majority of the aggregate principal amount of the Bonds then Outstanding, exclusive of Bonds disqualified as provided in Section 11.07. No such modification or amendment shall (i) extend the fixed maturity of any Bond, reduce the amount of principal thereof or the rate of inte rest thereon, extend the time of payment thereof or alter the redemption provisions thereof, without the prior written consent of the Owner of eac h Bond so affected, (ii) permit any pledge of, or the creation of any lien on, security interest in or charge or other encumbrance upon the assets pled ged under this In denture prior to or on a parity with the pledge contained in, and the lien a nd security interest created by, this Indenture or deprive the Owners of the pledge contained in, and the lien and security interest created by, this Indenture, except as expressly provided in this Indenture, without the prior written consents of the Owners of all Bonds then Outstanding, or (iii) modify or amend this Section without the prior writt en consents of the Owners of all Bonds then Outstanding.
(b) This Indenture and the rights and obligations of the Community Facilities District, the Trustee and the Owners hereunder may also be modified or amended from time to t ime and at any time by a Supplem ental Inden ture, w hich the C ommunity Facilities D istrict and the Trustee may enter into without the consent of any Owners for any one or more of the fol lowing purposes:
(i) to ad d to th e cove nants and agreements of the Community Facilities District in this Ind enture cont ained, other cove nants and agreements thereafter to be observed, to pledge or assign additional security for the Bonds (or any portion thereof), or to surrender an y right or po wer herein reserved to or conferred u pon the C ommunity Facilities District;
(ii) to m ake suc h provisions for the purpose of curing any ambiguit y, inconsistency or omission, or of curing or correcting any defective provision contained in this Indent ure, pr ovided that such modification or amendment does not materially adversely affect the rights or interests of the Owners hereunder; (iii) to provide for the issuance of one or more Series of Additional Bonds, and to provide the terms and conditions under which such Series of Additional Bonds may be issued, subject to and in accordance with the provisions of Article III; (iv) to permit the qualification of this Indenture under the Trust Indenture Act of 1939, as amended, or any similar federal statute hereafter in effect; (v) to c ause interest on the Bonds to be excl udable fr om gross income for purposes of federal income taxation by the United States of America; and 469

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(vi) in any other respect whatsoever as the Community Facilities District may deem nece ssary or d esirable, pr ovided that s uch modification or amendment does no t materially adversely affect the rights or interests of the Owners hereunder. (c) Promptly after the execution by the Community Facilities District and the Trustee of any Supplemental Ind enture, th e Trustee sh all mai l a no tice (the form of which shall be furnished to the Trustee by the Comm unity Facil ities D istrict), by first-class m ail p ostage prepaid, sett ing forth in gene ral terms the substance o f such Supplemental I ndenture, to the Owners at the respective addresses shown on the Registration Books. Any fai lure to g ive such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such Supplemental Indenture.

Section 9.02. Effect of S upplemental Indenture . Upon the e xecution of any Supplemental Indenture pursuant to this Articl e, this I ndenture shall be deeme d to be mod ified and amended in accordance therewith, and the respective rights, duties and obligations under this Indenture of the Community Facilities District, the Trustee and the Owners shall thereafter be determined, exercised a nd enforced hereunder s ubject in a ll respects to su ch modification and amendment, and all th e terms and condi tions of any such Supp lemental Indenture shall be deemed to be part of the terms and conditions of this Indenture for any and all purposes.

Section 9.03. Endorsement of Bonds; Prepar ation of Ne w Bonds. Bonds delivered after the effective date of any Supplemental Indenture pursuant to thi s Article may and, if the Community Facilities District so determi nes, shall bear a notation by endorsement or other wise in form approved by the Community Facilities District and the Trustee as to any modification or amendment provided for in such Supplemental Indenture, and, in that case, upon dema nd of the Owner of any Bond Outstanding at the time of such effective date and presentation of such Bond for such purpose at the Office of the Trustee a suitable notation shall be made on such Bonds. If the Suppl emental Indenture s hall so provide, new Bond s so modif ied as to co nform, in the opinion of the Community Facilities District and the Trustee, to any modification or amendment contained in such Supplemental Indenture, shall be prepared and e xecuted by the C ommunity Facilities District and authenticated by the Trustee and, in that case, upon demand of the Owner of any Bon d Outstanding at the time of suc h effective date, and presentation of such Bond for such purpose at t he Office of the Trustee, such a new Bo nd in e qual principal am ount of the same Ser ies, inter est rate and maturity sha ll be exchanged for such Owner’s Bond so surrendered.

Section 9.04. Amendment of Particular Bonds. The provisions of this Article shall not prevent any Owner from ac cepting any amendment or modification as to an y particular Bond owned by it, provided that due notation thereof is made on such Bond. 470

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ARTICLE X

DEFEASANCE
Section 10.01. Discharge of Indentur e. (a) If the Community Facilities District shall pay or cause to be pa id or there shall otherwise be paid to the Owners of all Outstandi ng Bonds the principal thereof and the interest and premium, if any, thereon at the times and in the manner stipulated herein and therein, then the Owners shall cease to be entitled to the p ledge of the Net Special Tax Revenues and the other assets pledged therefor hereunder, a nd all agreements, covenants and other obligations of the C ommunity Facilities Dis trict hereunder shall thereupon cease, terminate and become void and this Indenture shall be discharged and satisfied. In such event, the Trustee shall execute an d deliver to the Co mmunity F acilities District all such instruments as may be necessary or desirable to evidence such discharge and satisfaction, and the Trustee shall pay over or deliver to the Community Facilities District all money or securities held by it pursuant hereto that are not required for the payment of t he principal of and interest and premium, if any, on the Bonds.
(b) Subject to t he pr ovisions of subsecti on (a) of this Se ction, if the Community Facilities District sh all pay or cause to be paid to the Owner o f an Ou tstanding Bond the principal thereof and th e interest and premium, if any, thereon at the times and in the manner stipulated herein and therein, such Owner shall cease to be entitled to the pledge of th e Net Special Tax Revenue s and the other assets pledged ther efor hereunder and all agree ments, covenants and other obligations of the Community Facilities District hereunder shall thereupon cease, terminate and become void and this Indenture shall be discharged and satisfied as to such Bond.
(c) Notwithstanding the discharge and satisfaction of this Inden ture or t he discharge and satisf action of t his Ind enture in respect of any B ond, those provisions of this Indenture relating to the maturity of the Bonds, interest payments and dates thereof, exchange and transfer of Bo nds, replacement of mutilated, destro yed, lost or stolen Bonds, the s afekeeping and cancellation of Bonds, non-presentment of Bonds, and t he duties of the Trustee in co nnection with all of the foregoing, shall remain in effect and shall be bin ding upon the Trustee and the Owner of such Bond, and the Trustee shall continue to be obligated to hold in trust any moneys or inv estments then held b y the Trustee for the p ayment of the pr incipal of and inte rest and premium, if any, on such Bond, and to pay to the Owner of such Bond the funds so held by the Trustee as and when such payment becomes due. Notwithstanding the discharge and satisfaction of this Indenture, the obligation of the C ommunity Facilities District to indemni fy the Trustee pursuant to Section 8.07 shall remain in effect and be binding upon the Community Facilities District.

Section 10.02. Bonds Deemed To Have Been Paid. (a) If moneys shall have been set aside and held by the Trustee for the payment or redemption of any Bond and the payment of the interest thereon to the maturity or redemption date thereof, such Bo nd shall be deemed to have been paid within the meaning and with the effect provided i n Section 10.01. Any O utstanding Bond shall prior to the matu rity date or re demption date thereof be deemed to have been paid within the meaning of and with the effect expressed in Section 10.01 if (i) in case such Bond is to be redeemed on any date prior to its maturity date, the Community Facilities District shall have 471

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given to the Trustee in form satisfactory to it irrevocable instruction s to mail , on a date in accordance with the provisions of Se ction 4.02, notice of redemption of such Bond on said redemption date, said noti ce to be given in a ccordance with Section 4. 02, (ii) t here shall h ave been deposited with the Trustee either (A) mon ey in an amount that shall be s ufficient, or (B) Defeasance Securities, the principal of and the inte rest on which wh en due, and wi thout an y reinvestment thereof, together with the mo ney, if any, deposited therewith, will provide moneys that shall be sufficient to pay when due the interest to become due on such Bond on and prior to the maturity date or r edemption date t hereof, as the case ma y b e, a nd the princ ipal of a nd premium, if a ny, on suc h Bond, and (iii) in the ev ent such Bond is not by its terms s ubject to redemption within the next succee ding 60 d ays, the Community Facilities District shall have given the Truste e, in f orm sati sfactory to it, irrevocable instructions to mail as s oon as practicable, a notice to the Owner of such Bond that the deposit required by clause (ii) above has been made with the Trustee and that such Bond is deemed to have been paid in accordance with this Section and stating the mat urity date or redemption date upon which money is to b e available for the payment of the principal of and premium, if any, on such Bond. (b) No Bond shall be dee med to have been paid pursuant to clause (ii) of subsection (a) of this Section unless the Community Facilities District sha ll have caused to be d elivered to the Community Facilities District and the Trustee (i) an executed copy of a Verif ication Report with respect to such deemed payment, addres sed to the Commun ity Facilities District a nd t he Trustee, in form and in substance acceptable to the Community Facilities District, (ii) a copy of the escrow agreement entered into in con nection with the deposit pursuant to clause (ii)(B) of subsection (a) of this Section resulting in such deemed payment, which escrow agreement shall be in form an d in substan ce acceptable to the Community Facilities District and which escrow agreement shall provide that no substitution of Defeasance Securities shall be perm itted except with other Defeasance Secu rities and upon del ivery of a new Verificati on Report, and no reinvestment of Defeasance Securities shall be permitt ed except as contemplated by the original Verification Report or upon delivery of a new Verification Report, and (iii) a copy of an opinion of Bond Counsel, da ted t he d ate of such deem ed payment and address ed to t he Com munity Facilities District and the Tr ustee, in form and in substance acceptable to the Community Facilities District, to the effect that s uch Bond has been paid within the meaning and with the effect e xpressed in this Ind enture, all agreements, covenants a nd other obligations of the Community Facilities District hereunder have ceased, terminated and become void and the Indenture has been discharged and satisfied as to such Bonds.

Section 10.03. Unclaimed Moneys. Any moneys held by th e Trustee in trust for the payment of the principal of, or premium or in terest on, any Bond that remain unclaimed for two years afte r the date when such principal, premium o r interest has be come p ayable, if such moneys were held by the Trustee at such date , or for two years after the date of deposit of such moneys if deposited with the Trustee after the date when such principal, premiu m or i nterest become payable, shall be re paid by the Trust ee to the Com munity Fa cilities District a s its absolute property f ree from trust, and th e Trustee sha ll thereupon be released and discharg ed with respect thereto and the Owner of su ch Bond shall look only to the Community Facilities District for the payment of such principal, premium or interest. The Trustee shall hold a ny such moneys uninvested.
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ARTICLE XI

MISCELLANEOUS
Section 11.01. Successor Is Deemed Include d in All References to Predecess or.

Whenever in this Indenture either the Community Facilities Dist rict or the Trust ee is named or referred to, such reference shall be deemed to incl ude the successors or assigns thereof, and all the covenants and agreements in this Indenture contained required hereby to be performed by or on behalf of the Community Faci lities District or the Trustee shall bind and inure to the benefit of the respective successors and assigns thereof whether so expressed or not.

Section 11.02. Limitation of Rig hts. Nothing in this Indenture o r in th e Bonds expressed or implied is intended or shall b e construed to gi ve to any Per son other than t he Trustee, the Community Facilities District and the Owner s, any legal or equitable right, remedy or claim under or in respect of this Inden ture or any covenant, condition or provision therein or herein contained, and all such covenants, conditions and provisions are and shall be held to be for the sole and exclu sive be nefit of the Trustee, the Community Facilit ies Distr ict and the Owners.

Section 11.03. Destruction of Bonds. Whenever in this Indenture provision is made for the cancellati on by the Tru stee and the delivery to the Community Facilities Dis trict of any Bonds, the Trustee shall, in lieu of such cancellation and delivery, destroy such Bonds.

Section 11.04. Severability of I nvalid Pro visions. If any ter m or provision of th is Indenture or the Bonds, or the application of the term or provision to any Per son or circumstance is, to any extent , held to be invalid or unenforceable in any jur isdiction, but the extent of such invalidity or unenfor ceability does not destroy the basi s of the bargain between the p arties as contained herein, the remainder of this I ndenture or the Bonds, as applicable, or the application of the term or provision to Persons or circumstances other than tho se as to which t he term or provision is held invali d or unenforceable, shall not be affected by such invalidity or unenforceability, and each remaining term or provision of this Indenture and the Bonds shall be valid and will be enforced to the fullest extent permitted by law.

Section 11.05. Notices. Any wr itten notice, statement , demand, c onsent, approval, authorization, offer, designation, request or other communication to be given hereunder shall be given to the party entitle d thereto at its address set forth below, or at such oth er address as s uch party may provide to the other parties in writing from time to time, namely:

If to the Community Facilities District:

City of Ontario Community Facilities District
No. 56 (Parkside/La Avenida)
c/o City of Ontario
303 East “B” Street
Ontario, California 91764
Attention: Executive Director of Finance
473

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If to the Trustee:

Zions Bancorporation, National Association
550 South Hope Street, Suite 2875
Los Angeles, California 90071
Attention: Corporate Trust Services
If to NMC Builders:

NMC Builders, LLC
c/o SC Ontario Development Corporation
1156 North Mountain Avenue
Upland, California 91786
Attention: Administrative Member
Each such notice, statement, demand, consent, approval, authorization, offer, designation, request or other communication hereunder shall be d eemed delivered to t he party to w hom it is addressed (a) if giv en by courier or delivery service or if personal ly served or delivered, upon delivery, (b) if given by te lecopier, upon the sen der’s receipt of an appropriate answerback or other written acknowledgment, (c) if giv en by e lectronic mail, o n the date sent, bu t only if confirmation of the receipt of such electronic mail is received or if notice is concurrently sent by another means sp ecified h erein, (d) if given by registered or certified mai l, retu rn receipt requested, deposited with the Uni ted States mail postage prepaid, 72 hours after such notice is deposited with the United States mail, or ( e) if given by any other means, upon del ivery at the address specified in this Section.

Section 11.06. Evidence of Righ ts of Owners. (a) Any request, cons ent or other instrument required or permitted by this Indenture to be signed and executed by Owners may be in a ny numbe r of concurrent instruments of substan tially si milar t enor and shall be signed or executed by such Owners in person or by an agent or agents duly appointed in writing. Proof of the execution of any su ch request, con sent or o ther instrument or of a writing appointing any such agent shall be suf ficient for any purpose of this Indentur e and shall be conclusive in favor of the Trus tee and the C ommunity Facili ties District i f made in the m anner provided in this Section.
(b) The fact and date of the execution by any Person of any su ch request, consent or other instrument or writing may be proved by the certificate of any notary public or other officer of any jurisdiction, authorized by the laws thereof to take acknowledgments of deeds, certifying that the Person signing such request, consent or other instrument acknowledged to such notary public or such officer the execution thereof, or by an affidavit of a witness of such execution duly sworn to before such notary public or other officer.
(c) The ownership of Bonds shall be proved by the Registration Books. (d) Any request, consent or other instrument or writing of the Owner of any Bond shall bind every future Owner of the sa me B ond and th e Owner of every Bond issued in e xchange therefor or in lieu thereof, in respect of anything done or suffered to be done by the Trustee or the Community Facilities District in accordance therewith or reliance thereon. 474

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Section 11.07. Disqualified Bonds. In determining whether the Owners of the requisite aggregate principal amount of Bonds have concurred in any demand, request, direction, consent or waiver under this Indenture, Bonds that are actually known by the Trustee to be owned or held by or for the account of the Community Facilities District, or by any other obligor on the Bonds, or by any Person directly or indirectly controlling or co ntrolled by, or under direct or indirect common control with, the Community Facilities District or any other obligor on the Bonds, shall be disregarded and deemed not to be Outs tanding for the purp ose of any su ch deter mination; provided, however, that if 100% of the Bonds are so owned or held, such Bonds shall be deemed to be Outstanding. Bonds so owned that have been pledged in go od faith may be regarded as Outstanding for the purposes of this Section if the pledgee shall establish to the satisfaction of the Trustee the pledgee’s right to vote such Bonds and that the pledgee is not a Person directly or indirectly cont rolling or con trolled by, or under direct or in direct common c ontrol with, the Community Facilities District or any other obligor on the Bond s. In case of a dispute as to such right, any decision by the Trustee taken upon the advice of counsel shall be full protection to the Trustee. Upon request of the Trustee, the Community Facilities District shall specify in a Written Certificate of the Com munity Fa cilities D istrict submitted to the Trustee those Bonds, if any, that are, as of th e date of such Written Certificate, owned o r held by or for the account of t he Community Facilities District.

Section 11.08. Money Held for Particular Bonds. The money held by the T rustee for the p ayment of the interest, prin cipal or premi um due o n any date with resp ect to particular Bonds (or portions of Bonds in the case of Bonds redeemed in part only) shall, on and after such date and pending such payment, be set aside on its book s and h eld in trust by it for the Owner entitled thereto, subject, however, to the provisions of Section 10.03, but without any liability for interest thereon.

Section 11.09. Funds and Acco unts. Any Fund or Account required by th is Indenture to be established and mai ntained by the T rustee may be established an d maintained i n the accounting records of the Trustee, either as a fund or an account, and may, for the purposes of such records, an y audits t hereof and any reports o r statem ents with re spect thereto, be treated either as a fund or as an account, but all s uch records wi th respe ct to all such Funds and Accounts shall at all ti mes be maintai ned in accordance with prudent co rporate trust industry standards, and with due regard for the requirements hereof and for the protection of the security of the Bonds and the rights of every Ow ner thereof. The Tru stee ma y esta blish any s uch additional Funds or Accounts as it deems necessary to perform its obligations hereunder.

Section 11.10. Business Days. If the date for making any payment or the last date for performance of any act or the exercising of any right, as provided in this Indenture, shall not be a Business Day, s uch pa yment may be made or act perform ed or right e xercised on the next succeeding Business Day, with the same force and effect as if done on the nominal date provided in this Indenture and, unless otherwise specifically provided in this Indenture, no interest shall accrue for the period from and after such nominal date.

Section 11.11. Waiver of P ersonal Liability. No member, office r, agent or employee of the Community Facilities District or the City shall be individually or personally liable for the payment of the principal of or premium or interest on t he Bonds or be subject to any personal liability or accountability by reason of the issuance thereof, but nothing herein con tained shall 475

63 4140-7971-6425.3

relieve any such member, officer, agent or employee from the performance of any official duty provided by any applicable provision of law or by this Indenture.

Section 11.12. Conflict with Act. In the event of any conflict between any provision of this I ndenture and a ny provi sion of the Act, the provision of the Act sha ll p revail over th e provision of this Indenture.

Section 11.13. Conclusive Evi dence of R egularity. Bonds issued pursua nt t o this Indenture shall constitute evidence of the regularity of all proceeding s under the Ac t relative to their issuance and to the levy of the Special Tax.

Section 11.14. Governing Laws. This Indenture shall be governed by and construed in accordance with the laws of the State.

Section 11.15. Electronic Signatur e. Each of the partie s h ereto agrees that the transaction consisting of this Indentur e may b e conducted by electr onic means. Eac h party agrees, and acknowledges that it is su ch party’s intent, that if such par ty signs thi s Indenture using an electronic signature, it is signing, adopting and accepting this Indenture and that signing this In denture using an electronic signature is th e legal e quivalent of having plac ed its handwritten si gnature on this In denture o n paper. Eac h party acknowledges that it is b eing provided with an electronic or paper copy of this Indenture in a usable format.

Section 11.16. Execution in Several Counterparts. This Indenture may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.

476

4140-7971-6425.3

IN WITNESS WHEREOF, the Community Facilities District has caused this Indenture to be signed in its name by its representative thereunto duly authorized, and the Trustee, in token of its acceptance of the trusts created hereunder, has caused this Indenture to be s igned in its corporate name by its officer thereunto duly authorized, all as of the day and year first above written.

CITY OF ONTARIO COMMUNITY
FACILITIES DISTRICT NO. 56
(PARKSIDE/LA AVENIDA)

By:

ZIONS BANCORPORATION,

NATIONAL ASSOCIATION, AS

TRUSTEE

By:

[Signature Page to Indenture]
477

A-1
4140-7971-6425.3

EXHIBIT A

PERMITTED INVESTMENTS
“Permitted Investments” means the following:
(1) (a) Direct obligations (other than an obligation subject to variation in principal repayment) of the United States of Amer ica (“United States Treasury O bligations”), (b) obligations fully and unconditionally guaranteed as to ti mely payment of principal and interest by the United S tates of A merica, (c) ob ligations fully an d uncondi tionally guaranteed a s to timely pa yment of pr incipal and inter est by any ag ency or instrumentality of the United States of America when such obligations are backed by the full faith and credi t of the United States of America, or (d) evidences of ownership of proportionate interests in future interest and principal payments on obligations described above held by a b ank or tr ust comp any as cus todian, under which the owner of the investment is th e re al party in interest and has the right to proceed d irectly a nd individually against th e obl igor and the un derlying governme nt obligation s are not available to any person claiming through the custodian or to whom the custodian may be obligated.
(2) Federal Housing Administration debentures.
(3) The listed o bligations of governme nt-sponsored agencies which are n ot backed by the full faith and credit of the United States of America:
- Federal Home Loan Mortgage Corporation (FHLMC)
Senior debt obligations and participation certificates (excluded are stripped mortgage securities which are purchased at prices exceeding their principal amounts)
- Farm Credit System (formerly: Federal Land Banks, Federal Intermediate Credit Banks and Banks for Cooperatives)
Consolidated system wide bonds and notes
- Federal Home Loan Banks (FHL Banks)
Consolidated debt obligations
- Federal National Mortgage Association (FNMA)
Senior debt obligations
Mortgage-backed securities (excluded are
stripped mortgage securities which are purchased
at prices exceeding their principal amounts)

(4) Unsecured certi ficates of de posit, ti me deposits or ot her bank de posit products, and bankers’ acceptances (having maturities of not more than 365 days) of any bank, the short-term obligations of which are rated “A-1+” or better by S&P and “Prime- 1” by Moody’s.
478

A-2
4140-7971-6425.3

(5) Deposits the aggregate amount of which are fully insured by the Feder al Deposit Insurance Corporation, in banks which have capital and surplus of at least $ 15 million.
(6) Commercial paper (having original maturities of not more than 270 d ays) rated at the time of purchase “A-1+” by S&P and “Prime-1” by Moody’s. (7) Money market mutual funds rated “AAm” or “AAm-G” by S&P, or better and, if rated by Moody’s, rated “Aa2” or better, including a fund for which the Trustee, its parent holding company, if any, or any affiliates or subsidiaries of the Trustee provide transfer agen cy, custodial, investment advisory o r other m anagement services, and, subject to the prior written consent of S&P and Moody’s, the investment pool maintained by the county in which the Community Facilities District is located or other investment pools, in either case so long as s uch pool is rated in one of t he two hig hest ra ting categories by S&P and Moody’s.
(8) State Obligations, which means
(a) Direct g eneral obligations of any s tate of the U nited St ates of America or any su bdivision or agen cy thereof to which is pledged t he full faith and credit o f a stat e the unsecured g eneral obligation debt of whi ch is rated at least “A3” by Moody’s and at least “A-” by S&P, or better, or any obligation fully and unconditionally guarantee d by a ny state, s ubdivision or agency whose unsecured general obligation debt is so rated.
(b) Direct, ge neral short -term obligations of any state agency or subdivision or agency thereof described in ( a) above and rated “A -1+” by S &P and “MIG-1” by Moody’s.
(c) Special Rev enue Bonds (a s defined in the Un ited States Bankruptcy Code) of any state or state agency in (a) abo ve and rated “AA-” or better by S&P and “Aa3” or better by Moody’s.
(9) Pre-refunded municipal obligations rated “ AA+” by S& P an d “Aaa” by Moody’s meeting the following requirements:
(a) the municipal obligations are (i) not subject to redemption prior to maturity or (ii) the trustee for the muni cipal obligations has be en given irrevocable instructions concerning their call and redemption and the issuer of the municipal obligations has cov enanted n ot to redeem such municipal obligations other than as set forth in such instructions;
(b) the municipal obligations are secured by cash or Uni ted State s Treasury Obligations which may be applied only to payment of the principal of, interest and premium on such municipal obligations;
(c) the principal of and inte rest on the United States Tre asury Obligations (plus any cash in t he escrow) has bee n verifie d by the repo rt of 479

Ontario City CouncilNovember 7, 2023

Ontario City Council
November 7, 2023