Rancho Cordova City Council
October 21, 2024

J-2
Form 8038-G, and other federal income tax advice that it may give to the Issuer from time to time relating to the Bonds.

Dated: [Closing Date] PIPER SANDLER & CO.

By:

Managing Director

ITEM 19.3.

ATTACHMENT 3

Schedule

SCHEDULE A

SALE PRICES OF THE GENERAL RULE MATURITIES
(Attached)
ITEM 19.3.

ATTACHMENT 3

Jones Hall Draft 10.8.24
PRELIM
INARY OFFICIAL STATEMENT DATED ___________, 2024
NEW ISSUE–FULL BOOK-ENTRY NOT RATED
In the opinion of Jones Hall, A Professional Law Corporation, San Francisco, California, Bond Counsel, subject, however to ce rtain qualifications described herein, under existing law, the interest on the Bonds is excluded from gross income for federal income tax purposes and such interest is not an item of tax preference for purposes of the federal alternative minimum tax. Interest on the Bonds may be subject to the corporate alternative minimum tax. In the further opinion of Bond Counsel, such interest is exempt from California personal income taxes. See “TAX MATTERS” herein.
$____________*
IMPROVEMENT AREA NO. 2 OF

CITY OF RANCHO CORDOVA
GRANTLINE 220 COMMUNITY FACILITIES DISTRICT NO. 2023-1
SPECIAL TAX BONDS SERIES 2024
Dated: Date of Delivery Due: September 1, as shown on inside cover Authority for Issuance. The above-captioned bonds (the “Bonds”) are being issued by the City of Rancho Cordova (the “City”) by and through its City of Rancho Cordova Grantline 220 Community Facilities District No. 2023-1 (the “District”) for Improvement Area No. 2 of the District (“Improvement Area No. 2”). The Bonds are special tax obligations of the City, authorized pursuant to the Mello -Roos Community Facilities Act of 1982, as amended, being California Government Code Section 53311, et seq. (the “Mello-Roos Act ”), and are issued pursuant to a Fiscal Agent Agreement, dated as of November 1, 2024 ( the “Fiscal Agent Agreement ”) by and between the City and U.S. Bank Trust Company, National Association, as fiscal agent (the “Fiscal Agent”). See “THE BONDS – Authority for Issuance.” Security and Sources of Payment. The Bonds are secured by and payable from a pledge of Special Tax Revenues (as defined herein) levied on property within Improvement Area No. 2 according to a rate and method of apportionment of special tax, including from the proceeds of any foreclosure actions brought following a delinquency in the payment of the Special Taxes (as defined herein), and from amounts held in certain funds under the Fiscal Agent Agreement, all as more fully described herein. The taxable real property within Improvement Area No. 2 consists of finished lots and single -family homes under construction, as well as some homes sold to individuals. Unpaid Special Taxes do not constitute a personal indebtedness of the owners of the parcels within Improvement Area No. 2. In the event of delinquency, proceedings may be conducted only against the parcel of real property securing the delinquent Special Tax. There is no assurance the owners will be able to pay the Special Tax or that they will pay such Special Tax even though financially able to do so. To provide funds for payment of the Bonds and the interest thereon as a result of any delinquent installments, the City will establish a Reserve Fund from Bond proceeds, as de scribed herein. See “SECURITY FOR THE BONDS.”
Property in Improvement Area No. 2 subject to the Special Tax is comprised of land in the City of Rancho Cordova, Sacramento County, California, developing into 364 single-family homes, as well as public and quasi -public uses, parks and open space not subject to the Special Tax. It is part of a larger development of homes built and sold by Lennar Homes of California , LLC, a California limited liability company (“Lennar Homes ”), mapped to consist of a total of 573 single-family homes at build-out. Improvement Area No. 1 consists of 209 homes, most of which have been sold.

Only the 364 single-family homes are currently in Improvement Area No. 2 and constitute security for the Bonds. See “IMPROVEMENT AREA NO. 2” and “OWNERSHIP OF PROPERTY WITHIN IMPROVEMENT AREA NO. 2.” Use of Proceeds. The Bonds are being issued to (i) construct and acquire certain public facilities, including payment of fees related to public facilities, authorized for the District and Improvement Area No. 2 ; (ii) make a deposit into the debt service reserve fund for the Bonds; (iii) pay capitalized interest on the Bonds through and including September 1, 2025; and (iv) pay the costs of issuance of the Bonds. See “FINANCING PLAN.”
Bond Terms. Interest on the Bonds is payable semiannually on March 1 and September 1 of each year , commencing March 1, 2025 . The Bonds will be issued in the denomination of $5,000 or integral multiples of $5,000 in excess thereof. The Bonds, when delivered, will be initially registered in the name of Cede & Co., as nominee of The Depository Trust Company ( “DTC”). DTC will act as securities depository for the Bonds.

See “THE BONDS – Description of the Bonds” and “APPENDIX G – DTC and the Book-Entry Only System.” Redemption. The Bonds are subject to optional redemption, mandatory sinking fund redemption, and special mandatory redemption from prepaid Special Taxes. See “THE BONDS – Redemption.”

THE BONDS ARE SPECIAL LIMITED OBLIGATIONS OF THE CITY, PAYABLE SOLELY FROM THE SPECIAL TAX REVENUES AND CERTAIN OTHER FUNDS AND AMOUNTS HELD BY THE FISCAL AGENT UNDER THE FISCAL AGENT AGREEMENT. THE INFORMATION SET FORTH IN THIS OFFICIAL STATEMENT, INCLUDING INFORMATION UNDER THE HEADING “BOND OWNERS ’ RISKS,” SHOULD BE READ IN ITS ENTIRETY.

MATURITY SCHEDULE
(see inside cover)
This cover page contains certain information for quick reference only. It is not a summary of essential information about th e Bonds. Potential investors should read this entire Official Statement to obtain information essential for making an informed investment decisi on. Investment in the Bonds involves risks that may not be appropriate for some investors. See “BOND OWNERS ’ RISKS” for a discussion of special risk factors that should be considered in evaluating the investment quality of the Bonds.

The Bonds are offered when, as and if issued by the City and accepted by the Underwriter, subject to approval as to their legality by Jones Hall, A
Professional Law Corporation, San Francisco, California, Bond Counsel, and subject to certain other conditions. Jones Hall , A Professional Law Corporation, also serves as disclosure counsel to the City. Certain matters will be passed upon for the City by Meyers Nave, A Professional Law Corporation, Sacramento, California, as City Attorney. Certain legal matters will be passed upon for the Underwriter by its counsel, Kutak Rock LLP, Irvine, California. It is anticipated that the Bonds, in book-entry form, will be available for delivery through the facilities of DTC on or about November ____, 2024*.
[PIPER LOGO]
The date of this Official Statement is: _________, 2024. ___________________________
* Preliminary; subject to change.

This Preliminary Official Statement and the information contained herein are subject to completion or amendment. These securities may not be sold nor may offers to buy be accepted prior to the time the Official Statement is delivered in final form. Under no circumstances shall this Preliminary Official Statement constitu te an offer to sell or a solicitation of an offer to buy nor shall there be any sale of these securities in any jurisdiction in which such offer solicitation or sale would be unlawful prior to registration or q ualification under the securities laws of such jurisdiction.

ITEM 19.3.

ATTACHMENT 4

MATURITY SCHEDULE

$__________ Serial Bonds
(Base CUSIP†: _______)

Maturity Principal Interest CUSIP†
(September 1) Amount Rate Yield Price ( )

$________ _____% Term Bond due September 1, ____, Yield: _____%, Price: _____%; CUSIP† _____

† Copyright 2024, American Bankers Association. CUSIP data herein are provided by CUSIP Global Services, managed by FactSet Research Systems Inc ., and are provided for convenience of reference only. Neither the City nor the Underwriter assumes any responsibility for the accuracy of these CUSIP data.

ITEM 19.3.

ATTACHMENT 4

CITY OF RANCHO CORDOVA

City Council

David M. Sander, Ph.D., Mayor
Siri Pulipati, Vice Mayor
Linda Budge, Councilmember
Garrett Gatewood, Councilmember
Donald Terry, Councilmember

Staff

Micah Runner, City Manager
Kim Juran-Karageorgiou, Administrative Services Director Stacy Leitner, City Clerk
Adam Lindgren of Meyers Nave, A Professional Law Corporation, City Attorney

SPECIAL SERVICES

Bond Counsel and Disclosure Counsel
Jones Hall, A Professional Law Corporation
San Francisco, California

Municipal Advisor
NHA Advisors, LLC
San Rafael, California

Special Tax Consultant
Goodwin Consulting Group, Inc.

Sacramento, California

Appraiser
Integra Realty Resources
Sacramento, California

Fiscal Agent
U.S. Bank Trust Company, National Association
Seattle, Washington

ITEM 19.3.

ATTACHMENT 4

TABLE OF CONTENTS

Page Page
INTRODUCTION ............................................ 1 FINANCING PLAN ......................................... 6 THE BONDS .................................................. 7 Authority for Issuance ................................. 7 Description of the Bonds ............................ 7 Redemption ................................................ 8 Transfer or Exchange of Bonds ................ 10
SECURITY FOR THE BONDS ..................... 12
Special Taxes ........................................... 12 Special Tax Formula ................................. 13 Special Tax Fund ...................................... 17 Deposit and Use of Proceeds of Bonds .... 18
Delinquent Payments of Special Tax;
Covenant for Foreclosure ..................... 18
Reserve Fund ........................................... 20 Improvement Fund ................................... 21 No Additional Bonds, Except for Refunding21
DEBT SERVICE SCHEDULES .................... 22
IMPROVEMENT AREA NO. 2 ..................... 24
Formation and Background ...................... 24
Description and Location .......................... 24
Development in Improvement Area No. 2 28
THE FACILITIES .......................................... 33 Eligible Facilities ....................................... 33 Acquisition by the City and other Local
Agencies ............................................... 33

OWNERSHIP OF PROPERTY WITHIN
IMPROVEMENT AREA NO. 2 .................. 33

VALUE OF PROPERTY WITHIN
IMPROVEMENT AREA NO. 2 .................. 36
Appraised Values and Building Permits ... 36
Appraised Values ..................................... 36 Value to Special Tax Burden Ratios ......... 38
Priority of Lien ........................................... 42 Estimated Tax Burden on Single -Family
Home .................................................... 46 Special Tax Collections and Delinquencies47
BOND OWNERS’ RISKS ............................. 47
Limited Obligation of the City to Pay Debt
Service .................................................. 47 Concentration of Ownership ..................... 47
Levy and Collection of the Special Tax ..... 48
Property Tax Delinquencies ...................... 49
Property Values and Risks Related to
Development ........................................ 50 Future Property Development ................... 52
Other Possible Claims Upon the Value of
Taxable Property .................................. 53
Exempt Properties .................................... 53 FDIC/Federal Government Interests in
Properties ............................................. 54 Depletion of the Reserve Fund ................. 55
Bankruptcy Delays .................................... 56 Disclosure to Future Purchasers .............. 58
No Acceleration Provisions ....................... 58
Loss of Tax Exemption ............................. 58
IRS Audit of Tax-Exempt Bond Issues ..... 58
Voter Initiatives ......................................... 59 Case Law Related to the Mello -Roos Act
Voting .................................................... 59 Secondary Market for Bonds .................... 61
Pandemic Diseases .................................. 61 Cyber Security .......................................... 61 Potential Early Redemption of Bonds from
Prepayments ......................................... 61 LEGAL MATTERS ........................................ 62 Legal Opinion ............................................ 62 No Litigation .............................................. 62 TAX MATTERS ............................................. 62 CONTINUING DISCLOSURE ....................... 64
The City .................................................... 64 Lennar Homes .......................................... 64 NO RATING .................................................. 65 UNDERWRITING ......................................... 65 CONTINGENT FEES .................................... 65 EXECUTION ................................................. 66

APPENDIX A Rate and Method of Apportionment of Special Tax APPENDIX B The Appraisal
APPENDIX C Summary of Certain Provisions of the Fiscal Agent Agreement APPENDIX D Sacramento County and City of Rancho Cordova Demographic Information APPENDIX E Form of Opinion of Bond Counsel
APPENDIX F Form of Continuing Disclosure Undertakings
APPENDIX G DTC and the Book-Entry Only System
ITEM 19.3.

ATTACHMENT 4

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__________________________________

OFFICIAL STATEMENT
__________________________________

$___________*
IMPROVEMENT AREA NO. 2 OF

CITY OF RANCHO CORDOVA
GRANTLINE 220 COMMUNITY FACILITIES DISTRICT NO. 2023-1
SPECIAL TAX BONDS SERIES 2024

This Official Statement, including the cover page and all appendices hereto, is provided to furnish certain information in connection with the issuance by the City of Rancho Cordova (the “City”) of the above-captioned bonds (the “Bonds”), for and on behalf of its Improvement Area No. 2 (“Improvement Area No. 2”) of the City of Rancho Cordova Grantline 220 Community Facilities District No. 2023-1 (the “District”).

Any statements made in this Official Statement involving matters of opinion or of estimates, whether or not so expressly stated, are set forth as such and not as representations of fact, and no representation is made that any of the estimates will be realized. Definitions of certain terms used herein and not defined herein shall have the meaning set forth in the Fiscal Agent Agreement. See APPENDIX C.

INTRODUCTION

This introduction is not a summary of this Official Statement. It is only a brief description of and guide to, and is qualified by, more complete and detailed information contained in the entire Official Statement, including the cover page and attached appendices, and the documents summarized or described in this Official Statement. A full review should be made of the entire Official Statement. The offering of the Bonds to potential investors is made only by means of the entire Official Statement.

The District and Improvement Areas. The District was established, Improvement Area No. 1 was designated as an initial improvement area within the District, and a future annexation area was created for the District (the “ Future Annexation Area”), pursuant to proceedings conducted by the City under the Mello- Roos Community Facilities Act of 1982, as amended (Sections 53311, et seq., of the Government Code of the State of California) (the “Mello-Roos Act”). In May 202 4, the land comprising the Future Annexation Area was annexed into the District as Improvement Area No. 2. N o land remains to be annexed from the Future Annexation Area.

The Bonds. The Bonds are issued pursuant to the p rovisions of the Mello-Roos Act, a Fiscal Agent Agreement, dated as of November 1, 2024 (t he “Fiscal Agent Agreement ”) between the City and U.S. Bank Trust Company, National Association , as fiscal agent (the “Fiscal Agent”), and a resolution adopted on __________, 2024 by the City Council of the City, which authorized the issuance of the Bonds (the “Resolution”).

* Preliminary; subject to change.

ITEM 19.3.

ATTACHMENT 4

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Registration of Ownership of the Bonds. The Bonds are issued only as fully registered bonds in book-entry form, registered in the name of Cede & Co., as nominee of The Depository Trust Company ( “DTC”), without coupons, in the denomination of $5,000 or any integral multiple thereof and shall be dated as of and bear interest from the date of delivery thereof at the rate or rates set forth on the cover page hereof. Interest on the Bonds is payable on March 1 and September 1 of each year (each an “Interest Payment Date ”), commencing March 1, 2025. Ultimate purchasers of Bonds will not receive physical certificates representing their interest in the Bonds. So long as the Bonds are registered in the name of Cede & Co., as nominee of DTC, references herein to the Owners shall mean Cede & Co., and shall not mean the ultimate purchasers of the Bonds. Payments of the principal, premium, if any, and interest on the Bonds will be made directly to DTC, or its nominee, Cede & Co. so long as DTC or Cede & Co. is the registered owner of the Bonds . Disbursements of such payments to DTC ’s Participants is the responsibility of DTC and disbursements of such payments to the Beneficial Owners is the responsibility of DTC ’s Participants and Indirect Participants, as more fully described herein. See “APPENDIX G – DTC and the Book-Entry Only System.”

Use of Proceeds. Proceeds of the Bonds will primarily be used to finance a portion of the costs of acquiring and constructing certain public infrastructure improvements necessary for development in the District, including payment of fees related thereto (the “Facilities,” as described herein). The Facilities are anticipated to consist of public capital facilities, such as roadway, storm drain, water, sewer, and park improvement s funded with development impact fees payable to the City and other local agencies in connection with the project. Proceeds of the Bonds will also be used t o make a deposit in the Reserve Fund (defined herein) , pay a portion of capitalized interest the Bonds through September 1, 2025, and pay the cost of issuance of the Bonds.

Security and Sources of Payment of the Bonds. The Bonds are secured by, and payable from , “Special Tax Revenues ,” which are defined as the proceeds of the Special Taxes annually received by the City , excluding any interest and penalties thereon collected in connection with delinquent Special Taxes, less an amount equal to the Administrative Expense Priority, including all scheduled payments and delinquent payments thereof, and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes. “Special Taxes ” means the special tax levied on taxable real property within the boundaries of Improvement Area No. 2 under the Rate and Method of Apportionment of Special Tax for Improvement Area No. 2 (the “Special Tax Formula” ), and “Administrative Expense Priority” means (i) for Fiscal Year 2024-25, $30,600, and (ii) for each subsequent year, an amount equal to the preceding fiscal year ’s Administrative Expense Priority plus an additional 2% of such amount. “

The Bonds are also payable from amounts held in certain funds and accounts pursuant to the Fiscal Agent Agreement, including the Reserve Fund, all as more fully described herein.

The Special Tax applicable to each taxable parcel in Improvement Area No. 2 will be levied and collected according to the tax liability determined by the application of the Special Tax Formula, which is set forth in APPENDIX A hereto. The Special Taxes represent fixed liens on the parcels of land subject to a Special Tax in Improvement Area No. 2 and failure to pay the Special Taxes could result in proceedings to foreclose tit le to the delinquent property. The Special Taxes do not constitute the personal indebtedness of the owners of taxed parcels and no proceedings to collect directly from an owner is permitted. See “SECURITY FOR THE BONDS – Special Tax Formula” and “APPENDIX A – Rate and Method of Apportionment of Special Tax.”

ITEM 19.3.

ATTACHMENT 4

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Pursuant to the Mello-Roos Act, the Resolution of Formation (as defined herein), and the Fiscal Agent Agreement, so long as any Bonds are outstanding, the City will annually levy the Special Tax against all taxable land within Improvement Area No. 2 in accordance with the proceedings for the authorization and issuance of the Bonds and to make provision for the collection of the Special Tax in amounts which will be sufficient to pay interest on, principal of and redemption premium (if any) on the Bonds as such becomes due and payable and to replenish the Reserve Fund (as defined herein) as necessary. See “SECURITY FOR THE BONDS – Special Taxes” herein.

The City Council, as legislative body of the District established the bonded indebtedness limit for the District in the principal amount of not to exceed $ 53,200,000 (excluding refunding bonds described in Section 53364.2(e) of the Mello -Roos Act), initially allocated as follows:
(i) for Improvement Area No. 1, $18,800,000 and (ii) for land within the Future Annexation Area, $34,400,000. The first and only series of bonds for Improvement Area No. 1 were issued by the City in April 2024. In May 2024, landowners in Improvement Area No. 2 unanimously consented to annexation to the District from the Future Annexation Area and the bonded indebtedness limit for Improvement Area No. 2 was established at $34,400,000 (the “ Authorization”). The Bonds are the first series of bonds being issued by the City under the Authorization, and no additional bonds secured on parity with the Bonds may be issued, except for refunding purposes.

In connection with the issuance of the Bonds, the City will direct the Fiscal Agent to establish a “ Reserve Fund ,” which will be funded in an amount equal to the Reserve Requirement (described herein) with respect to the Bonds . Amounts in the Reserve Fund are available for payment of the Bonds in the event of delinquencies in the payment of the Special Taxes to the extent of such delinquencies. See “SECURITY FOR THE BONDS – Reserve Fund.” If there are additional delinquencies after depletion of funds in the Reserve Fund, the City is not obligated to pay the Bonds, or supplement the Reserve Fund.

Property Subject to the Special Tax. Property in Improvement Area No. 2 subject to the Special Tax is comprised of land in the City developing into 364 single-family homes, as well as public and quasi-public uses, parks and open space not subject to the Special Tax. The 364 homes planned for Improvement Area No. 2 are being developed by Lennar Homes of California, LLC, a California limited liability company (“ Lennar Homes”), and marketed as Olive Grove, Verdant II, Viridian II, Celedon, Jade and Midor i, with some homes recently sold, as detailed herein.

Development of the 364 homes within Improvement Area No. 2 is part of a larger development planned to consist of a total of 573 single -family homes at build-out; as of October 1, 2024, __ homes in the project (comprising Improvement Area No. 1 and No. 2) are owned by individual homeowners. Only the 364 single-family homes are currently in Improvement Area No. 2 and constitute security for the Bonds.

In connection with a land banking transaction, on May 26, 2023, Lennar Homes and AG EHC II (LEN) CA 2, L.P., a Delaware limited partnership (the “Land Bank Owner”) entered into that certain Option Agreement (the “Option Agreement ”) whereby Lennar Homes has the option, but not the obligation, to purchase all the residential lots in the project from the Land Bank Owner. Simultan eously with entering into the Option Agreement, an initial purchase was made, comprising the 209 lots in Improvement Area No. 1, with future transfers of land within Improvement Area No. 1 and Improvement Area No. 2 contemplated extending through September 1 0, 2026 . As of October 1, 2024, the Land Bank Owner owns 212 lots in Improvement Area No. 2. Lennar is allowed to build prior to take-down from the Land Bank.

ITEM 19.3.

ATTACHMENT 4

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As of October 1, 2024, 70 homes in Improvement Area No. 2 were owned by individual homeowners, with an additional 92 homes under contract, as detailed in the table below. All lots within Improvement Area No. 2 are in “finished lot” condition. See “IMPROVEMENT AREA NO. 2” and “OWNERSHIP OF PROPERTY WITHIN IMPROVEMENT AREA NO. 2.”

Grantline 220 Community Facilities District No. 2023-1
Improvement Area No. 2 – Special Tax Bonds
Status of Development – As of October 1, 2024

Community
No. of
Lots(1)
Building
Permits
Issued
Partially
Completed
Homes
Homes Under
Contract
Homes Sold
and Closed
Olive Grove 78 68 51 17 15
Verdant II 40 40 40 7 0
Viridian II 59 59 40 19 16
Celedon 60 60 34 14 11
Midori 87 87 51 17 24
Jade 40 40 35 18 4
Total 364 349 251 92 70

(1) 4 lots have been improved with a model home .

Source: Lennar Homes.

Home Offerings – As of October 1, 2024

Community
No. of
Lots
Floor
Plan
Range
Base
Price
Range(1)
Olive Grove 78 1228-1900 $496,000-$554,000
Verdant II 40 1579-2528 $574,000-$646,000
Viridian II 59 1596-2609 $584,000-$672,000
Celedon 60 1765-2966 $586,000-$709,000
Midori 87 2510-3308 $688,000-$795,000
Jade 40 1991-3025 $600,000-$699,000
(1) Base Pricing as of October 1, 2024. Excludes upgrades, concessions, and other offsets in pricing such as mortgage rate buy-downs.

Source: Lennar Homes.

Value of Property. Property in Improvement Area No. 2 is security for the Special Tax.

The City ordered preparation of an appraisal report (the “Appraisal”) of the estimated value of the taxable land within Improvement Area No. 2 as of a date of value of August 6 , 2024 prepared by Integra Realty Resources, Sacramento, California (the “Appraiser”). The Appraiser indicated a value estimate of $ 104,017,000 as of the date of value, subject to the conditions and qualifications set forth therein . The Appraisal is set forth in its entirety as APPENDIX B hereto. The description herein of the Appraisal is intended for limited purposes only; the Appraisal should be read in its entirety. In considering the estimates of value evidenced by the Appraisal, it should be noted that the Appraisal is based upon a number of standard and special assumptions that affected the estimates as to value, in addition to the assumption of completion of the Facilities expected to be funded with the proceeds of the Bonds. See “VALUE OF PROPERTY WITHIN IMPROVEMENT AREA NO. 2.”

ITEM 19.3.

ATTACHMENT 4

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The principal amount of the direct and overlapping debt in Improvement Area No. 2 is $18,506,999*, which consists of the estimated amount of Bonds ($17,500,000*) and $1,006,999 of overlapping CFD bond debt. Consequently, the estimated value of property in Improvement Area No. 2 subject to the Special Tax lien ($ 104,017,000), is approximately 5.6* times the principal amount of the direct and overlapping debt in Improvement Area No. 2. This is an average and individual parcels may vary considerably from this average.

Risks of Investment. Investment in the Bonds involves risks that may not be appropriate for some investors. See “BOND OWNERS’ RISKS” for a discussion of special factors that should be considered, in addition to the other matters set forth herein, in considering the investment quality of the Bonds.

Limited Obligation of the City. The general fund of the City is not liable and the full faith and credit of the City is not pledged for the payment of the interest on, or principal of or redemption premiums, if any, on the Bonds . The Bonds are not secured by a legal or equitable pledge of or charge, lien or encumbrance upon any property of the City or any of its income or receipts, except the Special Tax Revenues and amounts in certain funds established under the Fiscal Agent Agreement as described herein . The Bonds are special limited obligations of the City, and neither the City Council, the City nor any officer or employee thereof shall be liable for the payment of the interest on or principal of or redemption premiums, if any, on the Bonds other than from the Special Tax Revenues and amounts in certain funds established under the Fiscal Agent Agreement as described herein.

Summary of Information. Brief descriptions of certain provisions of the Fiscal Agent Agreement and certain other documents are included herein. The descriptions and summaries of documents herein do not purport to be comprehensive or definitive, and reference is made to each such document for the complete details of all its respective terms and conditions, copies of which are available for inspection at the office of the City. All statements herein with respect to certain rights and remedies are qualified by reference to laws and principles of equity relating to or affecting creditors’ rights generally. Capitalized terms used in this Official Statement and not otherwise defined herein have the meanings ascribed to such terms in the Fiscal Agent Agreement. See “APPENDIX C – Summary of Certain Provisions of the Fiscal Agent Agreement.” The information and expressions of opinion herein speak only as of the date of this Official Statement and are subject to change without notice. Neither delivery of this Official Statement, any sale made hereunder, nor any future use of this Official Statement shall, under any circumstances, create any implication that there has been no change in the affairs of the City or Improvement Area No. 2 since the date hereof.

* Preliminary, subject to change.

ITEM 19.3.

ATTACHMENT 4

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FINANCING PLAN

The Bonds are being issued to (i) construct and acquire certain public facilities, including payment of fees related to public facilities, authorized for the District and Improvement Area No. 2 (referred to herein as the Facilities ); (ii) make a deposit into the Reserve Fund equal to the Reserve Requirement for the Bonds; (iii) fund a portion of capitalized interest on the Bonds through September 1, 2025; and (iv) pay the costs of issuance of the Bonds.

A summary of the estimated sources and uses of funds associated with the sale of the Bonds follows:

Estimated Sources of Funds:

Principal Amount of the Bonds $
Plus/less: [Net] Original Issue Premium/Discount
Total $

Estimated Uses of Funds:

Deposit to Improvement Fund $
Deposit to Reserve Fund(1)
Deposit to Capitalized Interest Account of Bond Fund(2) Costs of Issuance(3)
Total $

(1) Equal to the Reserve Requirement with respect to the Bonds. (2) Used to pay a portion of capitalized interest on the Bonds through September 1, 2025. (3) Used to pay costs of issuance of the Bonds, including initial fees, expenses and charges of the Fiscal Agent, costs of printing the preliminary and final Official Statements, administrative fees of the City, Underwriter ’s discount, Municipal Advisor, fees of Bond Counsel and Disclosure Counsel, and other costs of issuance.

ITEM 19.3.

ATTACHMENT 4

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THE BONDS

Authority for Issuance

The Bonds are issued pursuant to the Fiscal Agent Agreement, the Resolution adopted by the City Council on ______, 2024, and the Mello-Roos Act.

On August 7, 2023, the City Council, as legislative body of the District and Improvement Area No. 1, adopted a resolution of formation which formed the District (the “Resolution of Formation”), and a future annexation area (the “ Future Annexation Area”) pursuant to proceedings conducted by the City under the Mello-Roos Community Facilities Act of 1982, as amended (Sections 53311, et seq., of the Government Code of the State of California) (the “Mello-Roos Act”). A bonded indebtedness limit for the District in the principal amount of not to exceed $53,200,000 (excluding refunding bonds described in Section 53364.2(e) of the Act), initially allocated as follows: (i) for Improvement Area No. 1, $ 18,800,000 and (ii) for land within the Future Annexation Area, $34,400,000.

In May 202 4, the land comprising the Future Annexation Area was annexed into the District as Improvement Area No. 2 and the bonded indebtedness limit for Improvement Area No. 2 was established in the principal amount of not to exceed $ 34,400,000 (excluding bonds described in Section 53364.2(e) of the Act) (referred to herein as the “ Authorization”). No land remains to be annexed from the Future Annexation Area.

Description of the Bonds

The Bonds are being issued as fully registered bonds, registered in the name of Cede & Co. as nominee of The Depository Trust Company ( “DTC”), and will be available to ultimate purchasers in the denomination of $5,000 or any integral multiple thereof, under the book -entry system maintained by DTC. Ultimate purchasers of Bonds will not receive physical certificates representing their interest in the Bonds. So long as the Bonds are registered in the name of Cede & Co., as nominee of DTC, references herein to the Owners shall mean Cede & Co., and shall not mean the ultimate purchasers of the Bonds. Payments of the principal, premium, if any, and interest on the Bonds will be made directly to DTC, or its nominee, Cede & Co., by U.S. Bank Trust Company, National Association, as the fiscal agent, registrar and transfer agent (the “Fiscal Agent”) for the Bonds, so long as DTC or Cede & Co. is the registered owner of the Bonds. Disbursements of such payments to DTC’s Participants is the responsibility of DTC and disbursements of such payments to the Beneficial Owners is the responsibility of DTC ’s Participants and Indirect Participants, as more fully described herein. See “APPENDIX G – DTC and the Book-Entry Only System.”

The Bonds will be dated as of and bear interest from the date of delivery thereof at the rates and mature in the amounts and years, as set forth on the cover page hereof. The principal of the Bonds and premiums due upon the redemption thereof, if any, will be payable in lawful money of the United States of America at the principal corporate trust office of the Fiscal Agent in Seattle, Washington , or such other place as designated by the Fiscal Agent, upon presentation and surrender of the Bonds.

Interest on the Bonds, computed on the basis of a 360 -day year consisting of twelve 30- day months, will be paid in lawful money of the United States of America semiannually on March 1 and September 1 of each year (each an “Interest Payment Date ”), commencing March 1, 2025 . Interest on the Bonds (including the final interest payment upon maturity or ITEM 19.3.

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earlier redemption) is payable by check of the Fiscal Agent mailed on each Interest Payment Date by first class mail to the registered Owner thereof at such registered Owner’s address as it appears on the registration books maintained by the Fiscal Agent at the close of business on the 15th day of the calendar month preceding the Interest Payment Date (the “Record Date”), or by wire transfer made on such Interest Payment Date upon written instructions received by the Fiscal Agent on or before the Record Date preceding the Interest Payment Date, of any Owner of $1,000,000 or more in aggregate principal amount of Bonds; provided that so long as any Bonds are in book-entry form, payments with respect to such Bonds shall be made by wire transfer, or such other method acceptable by the Fiscal Agent, to DTC. See “APPENDIX G – DTC and the Book-Entry Only System.”

Each Bond shall bear interest from the Interest Payment Date next preceding the date of authentication thereof unless (i) it is authenticated on an Interest Payment Date, in which event it shall bear interest from such date of authentication, or (ii) it is authenticated prior to an Interest Payment Date and after the close of business on the Record Date preceding such Interest Payment Date, in which event it shall bear interest from such Interest Payment Date, or (iii) it is authenticated prior to the Record Date preceding the first Interest Payment Date, in which event it shall bear interest from the dated date; provided, however, that if at the time of authentication of a Bond, interest is in default thereon, such Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon. So long as the Bonds are registered in the name of Cede & Co., as nominee of DTC, payments of the principal, premium, if any, and interest on the Bonds will be made directly to DTC, or its nominee, Cede & Co. Disbursements of such payments to DTC ’s Participants is the responsibility of DTC and disbursements of such payments to the Beneficial Owners is the responsibility of DTC ’s Participants and Indirect Participants, as more fully described herein.

See “APPENDIX G - DTC and the Book-Entry Only System.”

Redemption

Optional Redemption. The Bonds are subject to optional redemption from any source of available funds (other than prepayments of the Special Tax by property owners), in whole or in part among maturities as specified by the City and by lot within a maturity, on any date on and after September 1, 20__ at the following respective redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Redemption Dates
Redemption
Price
September 1, 20__ through August 31, 20__ 103%
September 1, 20__ through August 31, 20__ 102
September 1, 20__ through August 31, 20__ 101
September 1, 20__ and any date thereafter 100

Mandatory Redemption from Prepayments. The Bonds are subject to mandatory redemption from prepayments of the Special Tax by property owners, in whole or in part among maturities as shall be specified by the City and by lot within a maturity, on any Interest Payment Date at the following respective redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Redemption Dates
Redemption
Price
ITEM 19.3.

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Interest Payment Dates through and including 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

See “BOND OWNERS’ RISKS – Potential Early Redemption of Bonds from Prepayments” for a discussion of the potential for the Bonds to be priced with original issue premium and then be redeemed from Special Tax prepayments prior to maturity.

Mandatory Sinking Fund Redemption. The Bonds maturing September 1, 20__ and September 1, 20__ (the “Term Bonds”) are subject to mandatory sinking payment redemption in part on September 1, 20__ and September 1, 20__, and on each September 1 thereafter to maturity, by lot, at a redemption price equal to one hundred percent (100%) of the principal amount thereof to be redeemed, without premium, in the aggregate respective principal amounts as set forth in the following tables:

September 1, 20__ Term Bonds

Mandatory
Redemption Date
(September 1)

Sinking Fund
Payment

September 1, 20__ Term Bonds

Mandatory
Redemption Date
(September 1)

Sinking Fund
Payment

The amounts in the foregoing table shall be reduced pro rata, in order to maintain substantially uniform debt service, as a result of any prior partial optional redemption or mandatory redemption of the Bonds.

In lieu of redemption, moneys in the Bond Fund may be used and withdrawn by the Fiscal Agent for purchase of Outstanding Bonds , upon the filing with the Fiscal Agent of an Officer’s Certificate requesting such purchase, at public or private sale as and when, and at such prices (including brokerage and other charges) as such Officer ’s Certificate may provide, but in no event may Bonds be purchased at a price in excess of the principal amount thereof, plus interest accrued to the date of purchase.

Redemption Procedure by Fiscal Agent. The Fiscal Agent shall cause notice of any redemption to be mailed by first class mail, postage prepaid, at least 20 days but not more than 60 days prior to the date fixed for redemption, to the Securities Depositories and to one or more Information Services, and to the respective registered Owners of any Bonds designated for redemption, at their addresses appearing on the Bond registration books in the Principal Office of the Fiscal Agent; but such mailing shall not be a condition precedent to such redemption and ITEM 19.3.

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failure to mail or to receive any such notice, or any defect therein, shall not affect the validity of the proceedings for the redemption of such Bonds.

Such notice shall state the redemption date and the redemption price and, if less than all of the then Outstanding Bonds are to be called for redemption, shall designate the CUSIP numbers and bond numbers of the Bonds to be redeemed by giving the individual CUSIP number and number of each Bond to be redeemed or shall state that all Bonds between two stated numbers, both inclusive, are to be redeemed or that all of the Bonds of one or more maturities have been called for redemption, shall state as to any Bond called in part the principal amount thereof to be redeemed, and shall require that such Bonds be then surrendered at the Principal Office of the Fiscal Agent for redemption at the said redemption price, and shall state that further interest on such Bonds will not accrue from and after the redemption date.

The City has the right to rescind any notice of the optional redemption of Bonds. Any notice of redemption shall be cancelled and annulled if for any reason funds will not be or are not available on the date fixed for redemption for the payment in full of the Bonds then called for redemption, and such cancellation shall not constitute an event of default.

Upon the payment of the redemption price of Bonds being redeemed, each check or other transfer of funds issued for such purpose shall, to the extent practicable, bear the CUSIP number identifying, by issue and maturity, the Bonds being redeemed with the proceeds of such check or other transfer.

Whenever provision is made in the Fiscal Agent Agreement for the redemption of less than all of the Bonds of any maturity, the Fiscal Agent shall select the Bonds to be redeemed, from all Bonds or such given portion thereof of such maturity by lot in any manner which the Fiscal Agent in its sole discretion shall deem appropriate. Upon surrender of Bonds redeemed in part only, the City shall execute and the Fiscal Agent shall authenticate and deliver to the registered Owner, at the expense of the City, a new Bond or Bonds, of the same series and maturity, of authorized denominations in aggregate principal amount equal to the unredeemed portion of the Bond or Bonds.

Effect of Redemption. From and after the date fixed for redemption, if funds available for the payment of the principal of, and interest and any premium on, the Bonds so called for redemption shall have been deposited in the Bond Fund, such Bonds so called shall cease to be entitled to any benefit under the Fiscal Agent Agreement other than the right to receive payment of the redemption price, and no interest shall accrue thereon on or after the redemption date specified in such notice.

Transfer or Exchange of Bonds

So long as the Bonds are registered in the name of Cede & Co., as nominee of DTC, transfers and exchanges of Bonds shall be made in accord ance with DTC procedures. See APPENDIX G. Any Bond may, in accordance with its terms, be transferred or exchanged by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Bond for cancellation, accompanied by delivery of a duly written instrument of transfer in a form approved by the Fiscal Agent. Whenever any Bond or Bonds shall be surrendered for transfer or exchange, the City shall execute and the Fiscal Agent shall authenticate and deliver a new Bond or Bonds, for a like aggregate principal amount of Bonds of authorized denominations and of the same maturity. The cost for any services rendered or any expenses incurred by the Fiscal Agent in connection with any such transfer or exchange shall ITEM 19.3.

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be paid by the City. The Fiscal Agent shall collect from the Owner requesting such transfer any tax or other governmental charge required to be paid with respect to such transfer or exchange.

No transfers or exchanges of Bonds shall be required to be made (i) within 15 days prior to the date established by the Fiscal Agent for selection of Bonds for redemption or (ii) with respect to a Bond after such Bond has been selected for redemption.

ITEM 19.3.

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SECURITY FOR THE BONDS

The Bonds are secured by and payable from a first pledge of the proceeds of the “Special Tax Revenues,” defined in the Fiscal Agent Agreement as the proceeds of the Special Taxes annually received by the City , excluding any interest and penalties thereon collected in connection with delinquent Special Taxes, less an amount equal to the Administrative Expense Priority, including all scheduled payments and delinquent payments thereof, and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes. “Administrative Expense Priority ” means (i) for Fiscal Year 2024-25, $30,600, and (ii) for each subsequent year, an amount equal to the preceding fiscal year ’s Administrative Expense Priority plus an additional 2% of such amount.

All of the Special Tax Revenues and all moneys deposited in the Bond Fund and, until disbursed as provided herein, the Special Tax Fund are pledged to secure the repayment of the Bonds. In addition, the Bonds shall be secured by a pledge of all amounts in the Reserve Fund, and a series of Additional Bonds may be secured by a reserve account within the Reserve Fund or a separate reserve fund, as provided in the applicable Supplemental Agreement for such Series. Such pledge shall constitute a first lien on the Special Tax Revenues and said amounts.

The Special Tax Revenues and all moneys deposited into said funds are pledged to the payment of the principal of, and interest and any premium on, the Bonds as provided in the Fiscal Agent Agreement and in the Mello -Roos Act until all of the Bonds have been paid and retired or until moneys or Federal Securities (as defined in the Fiscal Agent Agreement) have been set aside irrevocably for that purpose. The City may issue additional bonds secured on a parity with the Bonds only for refunding purposes; see “–Additional Bonds” below.

Amounts in the Costs of Issuance Fund established under the Fiscal Agent Agreement are not pledged to the repayment of the Bonds. The Facilities are not in any way pledged to the repayment of the Bonds. Any proceeds of condemnation, destruction or other disposition of any Facilities are not pledged to the repayment of the Bonds and are free and clear of any lien or obligation imposed under the Fiscal Agent Agreement.

Special Taxes

A Special Tax applicable to each taxable parcel in Improvement Area No. 2 will be levied and collected according to the tax liability determined by the City through the application of the Special Tax Formula prepared by Goodwin Consulting Group, Inc., Sacramento, California (the “Special Tax Consultant ”) and set forth in APPENDIX A hereto, for all taxable properties in Improvement Area No. 2. Interest and principal on the Bonds is payable from the annual Special Taxes to be levied and collected on such property within Improvement Area No. 2, from amounts held in certain funds and accounts established under the Fiscal Agent Agreement and from the proceeds, if any, from the sale of such property for delinquency of such Special Taxes.

The Special Taxes are exempt from the property tax limitation of Article XIIIA of the California Constitution, pursuant to Section 4 thereof as a “special tax” authorized by a two- thirds vote of the qualified electors. The levy of the Special Taxes was authorized by the City pursuant to the Mello-Roos Act in a maximum amount determined according to the Special Tax Formula approved by the City. See “Special Tax Formula” below and “APPENDIX A – Rate and Method of Apportionment of Special Tax.”

ITEM 19.3.

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The amount of Special Taxes that the City may levy in any year on taxable property in Improvement Area No. 2, from which principal and interest on the Bonds is to be paid, is limited by the maximum rates approved by the qualified electors within Improvement Area No. 2 which are set forth as the “Maximum Special Tax” in the Special Tax Formula. Under the Special Tax Formula, Special Taxes will be levied annually in an amount not in excess of the Maximum Special Tax for the purpose of making payments on the Bonds. The Special Taxes and any interest earned on the Special Taxes shall constitute a trust fund for the principal of and interest on the Bonds pursuant to the Fiscal Agent Agreement and, so long as the amount levied for principal of and interest on these obligations remains unpaid, the Special Taxes and investment earnings thereon shall not be used for any other purpose, except as permitted by the Fiscal Agent Agreement, and shall be held in trust for the benefit of the owners thereof and shall be applied pursuant to the Fiscal Agent Agreement. The Special Tax Formula apportions the Special Tax Requirement (as defined in the Special Tax Formula and described below) among the taxable parcels of real property within Improvement Area No. 2 according to the rate and methodology set forth in the Special Tax Formula. See “– Special Tax Formula” below. See also “APPENDIX A – Rate and Method of Apportionment of Special Tax.”

The City may levy the Special Tax at the Maximum Special Tax rate authorized by the qualified electors within Improvement Area No. 2 as set forth in the Special Tax Formula if conditions so require and the City has covenanted to annually levy the Special Taxes in an amount at least sufficient to pay the Special Tax Requirement (as defined below). Because each Special Tax levy for payment of the Bonds is limited to the Maximum Special Tax rates authorized as set forth in the Special Tax Formula, no assurance can be given that, in the event of Special Tax delinquencies, the amount of the Special Tax Requirement will in fact be collected in any given year. See “BOND OWNERS’ RISKS – Levy and Collection of the Special Tax” herein. The Special Taxes are collected for the City by the County in the same manner and at the same time as ad valorem property taxes.

In addition to the Maximum Special Tax rate limitation in the Special Tax Formula, Section 53321(d) of the Mello -Roos Act provides that the special tax levied against any parcel for which an occupancy permit for private residential use has been issued may not be increased as a consequence of delinquency or default by the owner of any other parcel within a community facilities district by more than 10% above the amount that would have been levied in such fiscal year had there never been any such delinquencies or defaults. The Special Tax Formula contains a similar limitation. See “ – Special Tax Formula – Maximum Special Tax Rates,” below.

Special Tax Formula

The Special Tax authorized under the Mello -Roos Act applicable to land within Improvement Area No. 2 will be levied and collected according to the tax liability determined by the City through the application of the appropriate amount or rate as described in the Special Tax Formula (defined terms set forth below in this section have the meanings set forth in the Special Tax Formula) set forth in “APPENDIX A – Rate and Method of Apportionment of Special Tax.” The Special Tax will be levied each year from parcels within Improvement Area No. 2 in an amount at least sufficient to pay debt service on outstanding Bonds and administrative expenses. The Special Tax is expected to be collected at the same time and in the same manner as ad valorem property taxes. The City reserves the right to collect the taxes in another manner if required to meet annual obligations of Improvement Area No. 2.

ITEM 19.3.

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Each year, the City will determine the Special Tax Requirement for the upcoming fiscal year. The “Special Tax Requirement” is defined in the Special Tax Formula as the amount necessary in any fiscal year (i) to pay principal and interest on Bonds which are due in the calendar year which begins in such fiscal year, (ii) to pay periodic costs for the Bonds, including but not limited to , credit enhancement, liquidity support and rebate payments on the Bonds, (iii) to replenish reserve funds to the extent such replenishment was not included in the computation of the Special Tax Requirement in a previous fiscal year, (iv ) to cure any delinquencies in the payment of principal or interest on Bonds which have occurred in the prior fiscal year or, based on prior delinquencies, are expected to occur in the current fiscal year , (v) to pay Administrative Expenses, and (vi) to pay directly for Authorized Facilities, so long as such levy under this clause (vi) does not increase the Special Tax on Final Map Property or Undeveloped Property (as defined in the Special Tax Formula) . The Special Tax Requirement components in clauses (i) and (ii) may be reduced in any fiscal year by (a) interest earnings on, or surplus balances in, funds and accounts for the Bonds to the extent that such earnings or balances are available to apply against debt service pursuant to the Indenture, Bond resolution, or other legal document that set forth these terms, ( b) in the sole and absolute discretion of the City, proceeds received by the City from the collection of penalties associated with delinquent Special Taxes; and (c) any other revenues available to pay such costs as determined by the City.

Parcels Subject to the Special Tax. The City will prepare a list of the parcels subject to the Special Tax using the records of the City and the County Assessor. The City has the authorization to tax all parcels within Improvement Area No. 2 except tax-exempt parcels as described in the Special Tax Formula.

Each Fiscal Year, the Administrator shall: (i) assign each Parcel of Taxable Property to the appropriate Tax Zone and the appropriate Development Class, (ii) for Developed Property, categorize each Parcel as Single Family Property or Other Property, ( iii) for Other Property, determine the Acreage of each Parcel; and ( iv) determine the Special Tax Requirement for the Fiscal Year. In addition, the Administrator shall, on an ongoing basis, monitor the Tentative Map, Final Maps, and Building Permits to determine if there are any proposed Land Use Changes that would change the Expected Maximum Special Tax Revenues.

If the Expected Maximum Special Tax Revenues will be revised pursuant to a proposed Land Use Change, the Administrator shall apply the steps set forth in Section D of the Special Tax Formula . In any Fiscal Year, if it is determined that: (i) a parcel map for property in Improvement Area No. 2 was recorded after January 1 of the prior Fiscal Year (or any other date after which the Assessor will not incorporate the newly -created Parcels into the then current tax roll), (ii) because of the date the parcel map was recorded, the Assessor does not yet recognize the new Parcels created by the parcel map, and (iii) one or more of the newly - created Parcels is in a different Development Class and/or Land Use Category than other Parcels created by the subdivision, the Administrator shall calculate the Special Taxes for the property affected by recordation of the parcel map by determining the Special Taxes that apply separately to the property within each Development Class and/or Land Use Category, then applying the sum of the individual Special Taxes to the Parcel that was subdivided by recordation of the parcel map.

Assignment of Maximum Special Tax. The Special Tax Formula describes in detail the precise method for assigning the Maximum Special Tax to parcels within Improvement Area No. 2, which generally provides that each year the City will use the definitions contained in the Special Tax Formula to classify each parcel as tax -exempt or taxable. Changes to maximum ITEM 19.3.

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special tax rates due to Land Use Changes are handled per Section D of the Special Tax Formula. See APPENDIX A.

Maximum Special Tax Rates. The Maximum Special Tax for a Parcel of Developed Property or Final Map Property is the greater of (i) the Base Special Tax set forth in Table 1 to the Special Tax Formula which is reproduced below, or, (ii) the Maximum Special Tax determined pursuant to Section D of the Special Tax Formula . The Base Special Tax rates for Fiscal Year 2024-25 are set forth in the following table. For additional details, see APPENDIX A.

Improvement Area No. 2 of City of Rancho Cordova
Grantline 220 Community Facilities District No. 2023-1
Base Special Tax Rates – Developed Property and Final Map Property

Tax Zone Land Use Category
Fiscal Year 2024-25
Base Special Tax (1)(2)
Tax Zone 1 Single Family Property $2,038.98 per Residential Unit / SFD Lot Other Property $21,110.94 per Acre

Tax Zone 2 Single Family Property $2,346.00 per Residential Unit / SFD Lot Other Property $23,451.84 per Acre

Tax Zone 3 Single Family Property $2,653.02 per Residential Unit / SFD Lot Other Property $28,415.16 per Acre

Tax Zone 4 Single Family Property $2,825.40 per Residential Unit / SFD Lot Other Property $28,345.80 per Acre

Tax Zone 5 Single Family Property $3,234.42 per Residential Unit / SFD Lot Other Property $30,479.64 per Acre

Tax Zone 6 Single Family Property $3,637.32 per Residential Unit / SFD Lot Other Property $29,287.26 per Acre

(1) On July 1, 2025 and each July 1 thereafter, the Maximum Special Taxes shall be increased by 2% of the amount in effect in the previous fiscal year.
(2) Represents the Maximum Special Tax rates based on currently -expected land uses in Improvement Area No. 2.

Subject to change pursuant to Section D of the RMA.

Source: Goodwin Consulting Group, Inc.

Improvement Area No. 2 includes homes in all tax zones.

Similar to Section 53321(d) of the Mello- Roos Act (described above), the Special Tax Formula contains a provision that under no circumstances may the Special Tax on a Parcel of Developed Property in residential use be increased in any Fiscal Year as a consequence of delinquency or default in payment of the Special Tax levied on another Parcel or Parcels by more than ten percent (10%) above the amount that would have been levied in that Fiscal Year had there never been any such delinquencies or defaults.

Levy of Special Tax . Once the Special Tax Requirement has been determined for a particular Fiscal Year, the Special Tax will be levied according to the following steps:

Step 1: The Special Tax shall be levied Proportionately on each Parcel of Developed Property up to 100% of the Maximum Special Tax for each Parcel until the amount levied is equal to the Special Tax Requirement, prior to applying any Capitalized Interest that is available.

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Step 2: If additional revenue is needed after Step 1 in order to meet the Special Tax Requirement after Capitalized Interest has been applied to reduce the Special Tax Requirement, the Special Tax shall be levied Proportionately on each Parcel of Final Map Property up to 100% of the Maximum Special Tax for each Parcel of Final Map Property.

Step 3: If additional revenue is needed after Step 2 in order to meet the Special Tax Requirement, the Special Tax shall be levied Proportionately on each Parcel of Undeveloped Property up to 100% of the Maximum Special Tax for each Parcel of Undeveloped Property.

Step 4: If additional revenue is needed after Step 3, the Special Tax shall be levied Proportionately on each Parcel of Taxable Welfare Exemption Property, up to 100% of the Maximum Special Tax for each Parcel of Taxable Welfare Exemption Property.

Step 5: If additional revenue is needed after Step 4, the Special Tax shall be levied Proportionately on each Parcel of Taxable Owners Association Property, up to 100% of the Maximum Special Tax for each Parcel of Taxable Owners Association Property.

Step 6: If additional revenue is needed after Step 5, the Special Tax shall be levied Proportionately on each Parcel of Taxable Public Property, up to 100% of the Maximum Special Tax for each Parcel.

Termination of the Special Tax. The Special Tax will be levied until all Bonds have been repaid and all authorized facilities have been funded ; however, Special Taxes cannot be levied under any circumstance after Fiscal Year 2064-65.

Prepayment of the Special Tax . The Special Tax obligation assigned to a particular parcel within Improvement Area No. 2 can be prepaid, which will release the parcel making the prepayment from the Mello- Roos special tax lien. Section H of the Special Tax Formula sets forth a detailed formula by which the prepayment for a parcel can be calculated. Proceeds of such prepayment will be used to redeem a portion of the Bonds. See “THE BONDS – Redemption.”

ITEM 19.3.

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Projected Fiscal Year 2025-26 Special Tax Levy . The following table shows the projected Fiscal Year 2025-26 special tax levy by tax zone for Improvement Area No. 2

Improvement Area No. 2 of City of Rancho Cordova
Grantline 220 Community Facilities District No. 2023-1
Projected Fiscal Year 2025-26 Special Tax Levy by Tax Zone(1)

Tax Zone
Projected FY 2025-26
Maximum Special Tax
Projected FY 2025-26
Actual Special Tax (2)
Tax Zone 1 $162,221 $134,037
Tax Zone 2 95,717 $90,528
Tax Zone 3 159,659 $143,523
Tax Zone 4 172,914 $154,168
Tax Zone 5 131,964 $131,964
Tax Zone 6 322,776 $296,631
Totals $1,045,251 $950,850

(1) Based on building permits issued prior to August 6, 2024 and final maps recorded by June 30, 2024. (2) Includes debt service due in 2026 on the Series 2024 Special Tax Bonds and estimated administrative expenses in the amount of $30,600. T he Administrative Expense Priority for fiscal year 2024-25 is $30,600 and escalates by 2% per year.

Sources: Goodwin Consulting Group, Inc.

Special Tax Fund

When received, the Special Tax Revenues are required under the Fiscal Agent Agreement to be deposited into a Special Tax Fund to be held by the City in trust for the benefit of the City and the Owners of the Bonds. Within the Special Tax Fund, the City will establish and maintain two accounts, (i) the Debt Service Account, to the credit of which the City will deposit, immediately upon receipt, all Special Tax Revenue s, and (ii) the Surplus Account, to the credit of which the City will deposit surplus Special Tax Revenue as described below. Moneys in the Special Tax Fund will be disbursed as provided below and, pending any disbursement, will be subject to a lien in favor of the Owners of the Bonds.

All Special Tax Revenue will be deposited in the Debt Service Account upon receipt.

No later than 10 Business Days prior to each Interest Payment Date, the City will withdraw from the Debt Service Account of the Special Tax Fund and transfer (i) to the Fiscal Agent for deposit in the Reserve Fund, an amount which when added to the amount then on deposit therein, is equal to the Reserve Requirement, and (ii) to the Fiscal Agent for deposit in the Bond Fund an amount, taking into account any amounts then on deposit in the Bond Fund, such that the amount in the Bond Fund equals the principal, including any mandatory sinking fund payments, premium, if any, and interest due on the Bonds on the next Interest Payment Date. At such time as deposits to the Debt Service Account equal the principal, including any mandatory sinking fund payments, premium if any, and interest becoming due on the Bonds for the current Bond Year and the amount needed to restore the balance of the Reserve Fund to the Reserve Requirement, the amount in the Debt Service Account in excess of such amount may, at the discretion of the City, be transferred to the Surplus Account, which will occur on or after September 15th of each year.

Moneys in the Surplus Account may, at the City ’s discretion, be transferred to the Improvement Fund to pay for costs of the Facilities, to pay the principal of, premium, if any, and interest on the Bonds or to replenish the Reserve Fund to the amount of the Reserve ITEM 19.3.

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Requirement, but are not pledged to payment of the Bonds. See “–Assignment of Maximum Special Tax” above.”

Deposit and Use of Proceeds of Bonds

The Bonds are additionally secured by certain amounts generated from proceeds of the Bonds, together with interest earnings thereon pledged under the Fiscal Agent Agreement.

The proceeds of the initial purchase of the Bonds shall be paid to the Fiscal Agent, who shall deposit such proceeds in the 2024 Costs of Issuance Fund, the Improvement Fund, the Bond Fund (for capitalized interest) and the Reserve Fund established under the Fiscal Age nt Agreement. See APPENDIX C for information on use of the moneys, including investment earnings thereon, in the various funds established under the Fiscal Agent Agreement. See also “– Reserve Fund” and “– Improvement Fund” below.

Delinquent Payments of Special Tax; Covenant for Foreclosure

The Special Tax will be collected in the same manner and the same time as ad valorem property taxes, except at the City ’s option, the Special Taxes may be billed directly to property owners. In the event of a delinquency in the payment of any installment of Special Taxes, the City is authorized by the Mello -Roos Act to order institution of an action in superior court to foreclose the lien therefore.

In the Fiscal Agent Agreement t he City covenants for the benefit of the Owners of the Bonds that it will annually on or before September 1 of each year review the public records of the County of Sacramento relating to the collection of the Special Tax in order to determine the amount of the Special Tax collected in the prior Fiscal Year, and if the City determines on the basis of such review that the amount so collected is deficient it will enforce the lien of the Special Taxes by commencing, or cause to be commenced, foreclosure proceedings to judgment and sale in such manner and upon such timing as advised by legal counsel, taking into account the amounts delinquent, the estimate cost of legal proceedings, the status of Special Tax collections and available debt service reserves, under the following circumstances:

(a) if the amount so collected is deficient by more than 5% of the total amount of the Special Tax levied in such Fiscal Year, it will enforce the lien on all delinquent parcels; or

(b) if property owned by any single property owner in Improvement Area No. 2 is delinquent on four consecutive semi -annual Special Tax installments (irrespective of the total delinquencies in Improvement Area No. 2) it will enforce the lien against such property.

Under the Mello-Roos Act, foreclosure proceedings are instituted by the bringing of an action in the superior court of the county in which the parcel lies, naming the owner and other interested persons as defendants. The action is prosecuted in the same manner as other civil actions. In such action, the real property subject to the special taxes may be sold at a judicial foreclosure sale for a minimum price which will be sufficient to pay or reimburse the delinquent Special Taxes.

The owners of the Bonds benefit from the Reserve Fund established pursuant to the Fiscal Agent Agreement; however, if delinquencies in the payment of the Special Taxes are ITEM 19.3.

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significant enough to completely deplete the Reserve Fund, there could be a default or a delay in payments of principal and interest to the Owners of the Bonds pending prosecution of foreclosure proceedings and receipt by the City of the proceeds of foreclosure sales.

Additionally, it is possible that no bids are received at a foreclosure sale. Provided that it is not levying the Special Tax at the Maximum Special Tax rates set forth in the Special Tax Formula, the City may adjust the Special Taxes levied on all property within Improvement Area No. 2 subject to the Special Tax to provide an amount required to pay debt service on the Bonds, and to replenish the Reserve Fund, provided however such adjustment may not exceed the Maximum Special Tax or include an increase as a consequence of delinquency or default by the owner of any other parcel of developed property in private residential use within a community facilities district by more than 10% above the amount that would have been levied in such fiscal year had there never been any such delinquencies or defaults.

Under current law, a judgment debtor (property owner) has at least 140 days from the date of service of the notice of levy in which to redeem the property to be sold. If a judgment debtor fails to redeem and the property is sold, his or her only remedy is an action to set aside the sale, which must be brought within 90 days of the date of sale. If, as a result of such an action a foreclosure sale is set aside, the judgment is revived , and the judgment creditor is entitled to interest on the revived judgment as if the sale had not been made (California Code of Civil Procedure Section 701.680).

Foreclosure by court action is subject to normal litigation delays, the nature and extent of which are largely dependent upon the nature of the defense, if any, put forth by the debtor and the condition of the calendar of the superior court of the county. Such foreclosure actions can be stayed by the superior court on generally accepted equitable grounds or as the result of the debtor’s filing for relief under the Federal bankruptcy laws. The Mello -Roos Act provides that, upon foreclosure, the Special Tax lien will have the same lien priority as is provided for ad valorem taxes and special assessments. See “VALUE OF PROPERTY WITHIN IMPROVEMENT AREA NO. 2 – Priority of Lien.”

Teeter Plan. In 1949, the California Legislature enacted an alternative method for the distribution of property taxes to local agencies. This method, known as the “ Teeter Plan,” is found in Sections 4701-4717 of the California Revenue and Taxation Code. Upon adoption and implementation of this method by a county board of supervisors, local agencies for which the county collects property taxes and certain other public agencies and taxing areas located in the county receive annually the full amount of their shares of property taxes and other levies collected on the secured roll, including delinquent property taxes which have yet to be collected.

While the county bears the risk of loss on unpaid delinquent taxes, it retains the penalties associated with delinquent taxes when they are paid. In turn, the Teeter Plan provides participating local agencies with stable cash flow and the elimination of collection risk.

The Special Taxes levied in Improvement Area No. 2 are subject to Teeter Plan adopted by Sacramento County. Per a recent policy change, the County indicates it intends to remove parcels from the Teeter Plan after one year of non-payment, effectively meaning that if the first and second installments are both delinquent, the County would not cover the full amount, and in the following year delinquencies on the subject parcel would also not be covered.

There can be no assurance that Sacramento County will not modify or eliminate its Teeter Plan, or choose to remove the District, Improvement Area No. 2 or individual parcels from its Teeter Plan.

ITEM 19.3.

ATTACHMENT 4

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Reserve Fund

Under the Fiscal Agent Agreement, the Fiscal Age nt established the Reserve Fund , which is available for payment of the Bonds in the event of delinquencies in the payment of the Special Taxes to the extent of such delinquencies.

The City is required to maintain on deposit in the Reserve Fund an amount that is equal to the Reserve Requirement with respect to the Bonds. The “Reserve Requirement” means the least of (i) 125% of the average Annual Debt Service on the Bonds; (ii) Maximum Annual Debt Service on the Bonds; and (iii) 10% of the original principal amount of the Bonds (or, if the Bonds have more than a de minimis amount of original issue discount or premium, 10% of the issue price of the Bonds); provided, that:

(a) in no event shall the City be obligated to deposit an amount in the Reserve Fund in excess of the amount permitted by the applicable provisions of the Code to be so deposited from the proceeds of tax -exempt bonds without having to restrict the yield of any investment purchased with any portion of such deposit and, if the amount of any such deposit is so limited, the Reserve Requirement shall be only the amount of such deposit as permitted by the Code;

(b) the City may meet all or a portion of the Reserve Requirement with respect to the Bonds by depositing a Qualified Reserve Fund Credit Instrument in accordance with the Fiscal Agent Agreement; and

(c) the Reserve Requirement shall be set at the time of issuance of the Bonds and shall not increase thereafter but may decrease.

Amounts deposited in the Reserve Fund will be used and withdrawn by the Fiscal Agent solely for the purpose of making transfers to the Bond Fund in the event of any deficiency at any time in the Bond Fund of the amount then required for payment of the principal of, and interest on, the Bonds secured by the Reserve Fund. Whenever a transfer is made from the Reserve Fund to the Bond Fund due to a deficiency in the Bond Fund, the Fiscal Agent will provide written notice thereof to the City. If there are additional delinquencies after depletion of funds in the Reserve Fund, the City is not obligated to pay the Bonds or supplement the Reserve Fund.

Whenever, on the Business Day prior to any Interest Payment Date, the amount in the Reserve Fund exceeds the then applicable Reserve Requirement, the Fiscal Agent will transfer an amount equal to the excess from the Reserve Fund to the Bond Fund or the Improvement Fund as provided below, except that investment earnings on amounts in the Reserve Fund may be withdrawn from the Reserve Fund for purposes of making payment to the Federal government to comply with rebate requirements.

Moneys in the Reserve Fund will be invested and deposited in accordance with the Fiscal Agent Agreement. Interest earnings and profits resulting from the investment of moneys in the Reserve Fund and other moneys in the Reserve Fund will remain therein until the balance exceeds the Reserve Requirement; any amounts in excess of the Reserve Requirement will be transferred to the Improvement Fund, if the Facilities have not been completed, or if the Facilities have been completed, to the Bond Fund to be used for the payment of the principal of and interest on the Bonds in accordance with the Fiscal Agent Agreement.

ITEM 19.3.

ATTACHMENT 4

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The City has the right at any time to cause the Fiscal Agent to release funds from the Reserve Fund, in whole or in part, by tendering to the Fiscal Agent an irrevocable standby or direct-pay letter of credit or surety bond issued by a commercial bank or insurance company (a “Qualified Reserve Fund Credit Instrument ”), provided certain conditions are met, including that the long-term credit rating of such bank or insurance company is rated at least “AA” (without regard to qualifier) by S&P or Moody’s.

Whenever the balance in the Reserve Fund exceeds the amount required to redeem or pay the Outstanding Bonds, including interest accrued to the date of payment or redemption and premium, if any, due upon redemption, and making any other transfer required under the Fiscal Agent Agreement, the Fiscal Agent will transfer the amount in the Reserve Fund to the Bond Fund to be applied, on the next succeeding Interest Payment Date, to the payment and redemption of all of the Outstanding Bonds. If the amount so transferred from the Reserve Fund to the Bond Fund exceeds the amou nt required to pay and redeem the Outstanding Bonds, the balance in the Reserve Fund will be transferred to the City, after payment of any amounts due the Fiscal Agent, to be used for any lawful purpose of the City.

Improvement Fund

Under the Fiscal Agent Agreement, the Fiscal Agent established an “Improvement Fund,” which is held and used by the Fiscal Agent to pay the costs of the Facilities.

Disbursements from the Improvement Fund will be made by the Fiscal Agent in accordance with written requests of the City.

Before any payment from the Improvement Fund shall be made, the City shall file or cause to be filed with the Fiscal Agent a written request of the City for disbursement of moneys from such fund. Such withdrawals shall be implemented by the City pursuant to the terms and requirements of the Acquisition Agreement (described below). The Fiscal Agent need not make any such payment if it has received notice of any lien, right to lien or attachment upon, or claim affecting the right to receive payment of, any of the moneys to be so paid, that has not been released or will not be released simultaneously with such payment. The Fiscal Agent shall not incur any liability for any disburs ement from the Improvement Fund made in reliance upon any requisition. When the City determines that all of the costs of the Facilities to be financed with proceeds of the Bonds have been paid, the City shall provide written notification of such determination to the Fiscal Agent and direct the Fiscal Agent to transfer any remaining balance in any Improvement Fund into the Bond Fund. See “THE FACILITIES – Acquisition by the City.”

No Additional Bonds, Except for Refunding

The Bonds are the first series of bonds being issued by the City under the Authorization, and no additional bonds secured on parity with the Bonds may be issued, except for refunding purposes.

As an alternative to issuing additional parity bonds, the City may issue bonds for Improvement Area No. 2 secured by Special Taxes on a subordinate basis to the Bonds.

ITEM 19.3.

ATTACHMENT 4

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DEBT SERVICE SCHEDULES

Debt Service Schedule. The annual debt service on the Bonds based on the interest rates and maturity schedule set forth on the cover of this Official Statement is set forth below (assuming no early redemptions).

Improvement Area No. 2 of City of Rancho Cordova
Grantline 220 Community Facilities District No. 2023-1
Debt Service Schedule

Period Ending
Sept. 1
Bonds
Principal
Bonds
Interest(1)
Bonds
Total Debt Service
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
2054
Total
_____________
(1) Interest on the Bonds due through September 1, 2025 will be paid from capitalized interest.

Source: Underwriter.

ITEM 19.3.

ATTACHMENT 4

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Projected Debt Service Coverage . The projected debt service coverage for Fiscal Year 2025-26 is set forth below , and is based on the status of development as of August 6, 2024. To the extent that development status changes, the debt service coverage may be different than what is shown. The Bonds have been structured so there is at least 110% debt service coverage from the Maximum Facilities Special Tax net of Administrative Expense Priority in every year the Bonds are outstanding.

Improvement Area No. 2 of City of Rancho Cordova
Grantline 220 Community Facilities District No. 2023-1
Projected Fiscal Year 2025-26 Debt Service Coverage(1)(2)

Fiscal Year 2025-26
Maximum Special Tax
Developed and Final
Map Property(3)
Priority
Administration(4)
Estimated Debt
Service*
Debt Service Coverage
from Developed and
Final Map Property*
$1,045,251 ($30,600) $920,250 110.26%

* Preliminary; subject to change.
(1) Pursuant to Section 53321(d) of the Government Code, the special tax levied against any assessor's parcel for which an occupancy permit for private residential use has been issued shall not be increased as a consequence of delinquency or default by the owner of any other assessor's parcel within the District by more than 10% above the amount that would have been levied in the fiscal year had there never been any such delinquencies or defaults. (2) Based on currently-expected land uses in Improvement Area No. 2. Subject to change pursuant to Section D of the RMA. (3) Includes projected Maximum Special Tax revenues based on the status of development as of August 6, 2024. Assumes no future development.
(4) As defined in the Fiscal Agent Agreement. Equals $30,600 in Fiscal Year 2024-25, escalating by 2% per year thereafter.

Sources: Piper Sandler & Co.; Goodwin Consulting Group, Inc.

ITEM 19.3.

ATTACHMENT 4

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IMPROVEMENT AREA NO. 2

Formation and Background

On July 3, 2023, the City Council adopted a Resolution of Intention to form the District, designate Improvement Area No. 1 as an initial improvement area therein, and establish the Future Annexation Area, to levy a special tax and to incur bonded indebtedness for the purpose of financing the Facilities and making contributions to certain public facilities. After conducting a noticed public hearing, on August 7, 2023 , the City Council adopted the Resolution of Formation, which established the District , designated Improvement Area No. 1 therein, and created the Future Annexation Area , approved the Special Tax Formula for Improvement Area No. 1 and set forth the necessity to incur bonded indebtedness for the District and Improvement Area No. 1 in a total amount not to exceed $ 53,200,000 (excluding bonds or notes described in Section 53364.2(e) of the Mello-Roos Act), initially allocated as follows: (i) for Improvement Area No. 1, $18,800,000 and (ii) for the portion of the District that is not in Improvement Area No. 1, $34,400,000. The first and only series of bonds for Improvement Area No. 1 were issued by the City in April 2024 in the principal amount of $9,090,000.

In May 202 4, the land comprising the Future Annexation Area was annexed into the District as Improvement Area No. 2 and the bonded indebtedness limit for Improvement Area No. 2 was established in the principal amount of not to exceed $ 34,400,000 (excluding bonds described in Section 53364.2(e) of the Act) . No land remains to be annexed from the Future Annexation Area.

Description and Location

General. The development ongoing in the District is referred to by the City as the “Grantline 220” or “Pradera Ranch” project, and is generally located at the southwest corner of Grant Line Road and Chrysanthy Boulevard in the “Suncreek Specific Plan” area of the City.

Pradera Ranch is planned for a total of 573 residential lots, a multifamily project, two neighborhood parks, a school, several open space parcels, and supporting associated infrastructure. Lennar Homes has planned that the overall Grantline 220 residential project (comprised of land within both Improvement Area No. 1 and Improvement Area No. 2) will total 573 single-family homes at buildout.

The greater Rancho Cordova area is a mature suburban area, which encompasses all types of land uses, including single-family and multifamily residential, retail, office and industrial, and has experienced continued growth since the mid 1980 ’s. This area currently is a substantial suburban office market within the Sacramento region, as well as a major employment center, most of which is located along U.S. Highway 50, a major east-west highway which traverses the City. For certain demographic information relating to the City and the County, see “APPENDIX D – Sacramento County and City of Rancho Cordova Demographic Information.”

Maps. The following page s show the original boundary map of the District and Future Annexation Area , including Improvement Area No. 1 therein . In May 202 4, the entire Future Annexation Area was annexed into the District, and now comprises Improvement Area No. 2.

ITEM 19.3.

ATTACHMENT 4

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[Insert CFD Original Boundary Map]

ITEM 19.3.

ATTACHMENT 4

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[Insert CFD Annexation Boundary Map]

ITEM 19.3.

ATTACHMENT 4

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[Insert Site Plan Map]

ITEM 19.3.

ATTACHMENT 4

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Development in Improvement Area No. 2

Lennar Homes has provided the following information with respect to development within Improvement Area No. 2. No assurance can be given that all information is complete. No assurance can be given that development of the property will be completed, or that it will be completed in a timely manner. Since the ownership of the parcels is subject to change, the development plans outlined below may not be continued by the subsequent owner if the parcels are sold, although development by any subsequent owner will be subject to the Development Agreement and the policies and requirements of the City. No assurance can be given that the plans or projections detailed below will actually occur.

Overview. The development ongoing in the District is referred to by the City as the “Grantline 220” or “Pradera Ranch” project, and is generally located at the southwest corner of Grant Line Road and Chrysanthy Boulevard in the “Suncreek Specific Plan” area of the City.

The land within Improvement Area No. 2 consists of 364 residential lots with lot sizes ranging from 4,725 to 7,200 square feet. Lennar Homes is developing the 364 lots into six residential communities, known as Olive Grove, Verdant II, Viridian II, Celedon, Midori and Jade at Pradera Ranch.

The 364 lots in Improvement Area No. 2 represent the second phase of the project (referred to by Lennar Homes as Unit 3, Unit 4 and Unit 5 of the project), which are in addition to the 209 residential lots in Improvement Area No. 1, which includes ____ homes owned by individual homeowners as of October 1, 2024. The 364 lots were within the Future Annexation Area established for the District at the time it was formed, and were annexed to the District in May 2024. At buildout the project in the CFD will comprise a total of 573 single -family homes.

Only the land within Improvement Area No. 2 constitutes security for the Bonds.

Development Agreement . The City entered into a Development Agreement, dated January 21, 2014 (the “Development Agreement”) with Grantline & Chrysanthy 220 Investors, LLC, a California limited liability company (“ Chrysanthy 220”), which subsequently assigned its rights and obligations thereunder to Lennar Homes. The Development Agreement was entered into in accordance with Sections 65864 through 65869.5 of the California Government Code, as implemented through applicable provisions of the City Code.

The Development Agreement is the primary implementation tool for the development ongoing in the District and is intended to create a binding contract between the City and Lennar Homes (as assignee of Chrysanthy 220) , and their assigned successors in interest, which set forth the needed infrastructure improvements, park dedication requirements, timing and method for financing improvements and other specific performance obligations of the City and Lennar Homes and its successors, including obligations related to development of the property in the District, with the terms, conditions, rules, regulations, entitlements, vested rights and other provisions relating to the development of the property in the District according to the entitlements. Included are provisions relating to infrastructure improvements, public dedication requirements, landscaping amenities and other obligations of the parties. The Development Agreement has a 30 -year term, runs with the property, and may be modified only by mutual consent of the City and Lennar Homes. With the Development Agreement in place, subject to compliance with the terms of the Development Agreement, construction of homes within the District may occur upon City approval of subdivision maps, satisfaction of certain design requirements and conditions of such maps and issuance of building permits.

ITEM 19.3.

ATTACHMENT 4

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No Affordable Units. There are no affordable unit requirements within Improvement Area No. 2, other than a fee paid at building permit.

Flood Hazard Map Information. According to the Federal Emergency Management Agency’s flood insurance rate maps (Flood Area Panel Number 06067C-0240J, with an effective date of July 19, 2018), the developable portions of the property in Improvement Area No. 2 are located within Flood Zone X, described as areas of minimal flooding (outside of the 100 and 500-year floodplains).

Seismic Conditions. The developable portions of the property in Improvement Area No. 2 are not located within a seismic special studies zone, designated by the California State Division of Mines and Geology, in accordance with the Alquist -Priolo Special Study Zone Act of 1972.

Wildfire Hazards. Land in Improvement Area No. 2 is not located in a High or Very High Fire Hazard Severity Zone (FHSZ), as defined by CAL FIRE.

Environmental Mitigation. According to Lennar Homes, all environmental mitigation requirements have been met for all of the 364 lots within Improvement Area No. 2.

Entitlements. The entitlements for the project permit a development proposal related to a particular parcel to proceed through tentative map subdivision and design -review permitting processes to final mapping provided the development application is in accord with the entitlements and the final map conditions. Lennar Homes has received all necessary approvals to develop the 364 lots within Improvement Area No. 2, including, but not limited to, approval of Specific Plan Zoning and a Development Agreement, and subsequently received a Section 404 (wetlands) permit, California Water Board Section 401 Certification, and U.S. Fish and Wildlife Service Biological Opinion. Lennar Homes has also received a grading permit and site improvement plans to complete all planned 364 units in Improvement Area No. 2.

Final small-lot subdivision maps have been received for all 364 residential units in Improvement Area No. 2 and a ll lots within Improvement Area No. 2 are now in “finished lot” condition, although Lennar Homes is still completing some landscaping and other perimeter work related thereto.

ITEM 19.3.

ATTACHMENT 4

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Home Development. Lennar Homes is developing the land in Improvement Area No. 2 into six single-family, detached home product lines: Olive Grove, Verdant II, Viridian II, Celedon, Midori and Jade . All lots within Improvement Area No. 2 are now in “finished lot” condition , although Lennar Homes is still completing some landscaping and other related perimeter work as home sales progress. Construction of model and production homes began as a continuation of development in Improvement Area No. 1. Model homes in Improvement Area No. 2 opened in July 2024. The initial home sale in Improvement Area No. 2 closed in the second week of July 2024 and 70 homes sold had been sold as of October 1 st. Additional information regarding lot status, building permits issued, units under construction, sales and pricing for each product line follows:

Table 1A
Improvement Area No. 2 of City of Rancho Cordova
Grantline 220 Community Facilities District No. 2023-1
Status of Development in Improvement Area No. 2
As of October 1, 2024

Community
No. of
Lots(1)
Building
Permits
Issued
Partially
Completed
Homes
Homes Under
Contract
Homes Sold
and Closed
Olive Grove 78 68 51 17 15
Verdant II 40 40 40 7 0
Viridian II 59 59 40 19 16
Celedon 60 60 34 14 11
Midori 87 87 51 17 24
Jade 40 40 35 18 4
Total 364 349 251 92 70

(1) 4 lots have been improved with a model home.

Source: Lennar Homes.

Table 1B
Improvement Area No. 2 of City of Rancho Cordova
Grantline 220 Community Facilities District No. 2023-1
Base Pricing in Improvement Area No. 2
As of October 1, 2024

Community
No. of
Lots
Floor
Plan
Range
Base
Price
Range(1)
Olive Grove 78 1228-1900 $496,000-$554,000
Verdant II 40 1579-2528 $574,000-$646,000
Viridian II 59 1596-2609 $584,000-$672,000
Celedon 60 1765-2966 $586,000-$709,000
Midori 87 2510-3308 $688,000-$795,000
Jade 40 1991-3025 $600,000-$699,000
(1) Base Pricing as of October 1, 2024 . Excludes upgrades, concessions, and other offsets in pricing such as mortgage rate buy-downs.

Source: Lennar Homes.

Backbone and In -Tract Infrastructure. The conditions of development for the project require the construction of various improvements at various times. As of October 1, 2024 all required backbone and in -tract infrastructure was in place for the development and sale of the 364 planned single-family homes in Improvement Area No. 2.

Land-Banking Arrangement With AG . In connection with a land banking transaction, on May 26, 2023, Lennar Homes transferred all 364 lots in Improvement Area No. 2 (the “Land ITEM 19.3.

ATTACHMENT 4

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Bank Lots”) to AG EHC II (LEN) CA 2, L.P., a Delaware limited partnership (the “Land Bank Owner”). In connection therewith, Lennar Homes and the Land Bank Owner entered into that certain Option Agreement, dated May 26, 2023 (the “Option Agreement ”) whereby Lennar Homes has the option, but not the obligation, to purchase the Land Bank Lots from the Land Bank Owner beginning on May 26, 2023 and extending through September 10, 2026.

Lennar Homes is responsible for making special tax payments while the Option Agreement is in place. In the event that Lennar Homes does not exercise its option or the right to purchase the lots expires or is terminated, the Land Bank Owner being an investor only and not a homebuilder, would likely attempt to sell such lots to another merchant builder. Under the Option Agreement, Lennar has the option to take-down lots in accordance with a specified take- down schedule. In addition, Lennar Homes can accelerate the takedown of lots and, Lennar Homes can, and does, pull building permits and begin house construction on lots held by the Land Bank Owner before those lots are taken down. As of October 1, 2024, Lennar Homes had taken down 708 lots in accordance with the specified schedule, of which 404 are located in Improvement Area No. 1 and304 are located in Improvement Area No. 2 . Under the Lennar Option Agreement, Lennar Homes is allowed to pull building permits on lots still owned by the Land Bank Owner and has done so. Lennar is allowed to build prior to takedown from the Land Bank. The take-down schedule for the remaining lots governed thereby is as follows:

Table 1C
Improvement Area No. 2 of City of Rancho Cordova
Grantline 220 Community Facilities District No. 2023-1
Lennar Option Agreement – Take-Down Schedule for Grantline 220 Project As of October 1, 2024

Cumulative Lot Absorptions by Lot Type
Option
Period
Date Option
Period
Expires Lot A Lot B Lot C Lot D Lot E Total (1)
18 11/10/2024 63 63 63 64 63 316
19 12/10/2024 67 67 67 68 67 336
20 01/10/2025 71 71 71 72 71 356
21 02/10/2025 75 75 75 76 75 376
22 03/10/2025 79 79 79 80 79 396
23 04/10/2025 83 83 83 84 83 416
24 05/10/2025 87 87 87 88 87 436
25 06/10/2025 91 90 90 92 92 455
26 07/10/2025 95 90 90 96 92 463
27 08/10/2025 99 90 90 100 92 471
28 09/10/2025 103 90 90 104 92 479
29 10/10/2025 107 90 90 108 92 487
30 11/10/2025 111 90 90 112 92 495
31 12/10/2025 111 90 90 118 92 501
32 01/10/2026 111 90 90 124 92 507
33 02/10/2026 111 90 90 130 92 513
34 03/10/2026 111 90 90 136 92 519
35 04/10/2026 111 90 90 142 92 525
36 05/10/2026 111 90 90 148 92 531
37 06/10/2026 111 90 90 154 92 537
38 07/10/2026 111 90 90 160 92 543
39 08/10/2026 111 90 90 166 92 549
40 09/10/2026 111 90 90 190 92 573
_____________
(1) [ As of October 1, 2024 all lots have been taken down as per the schedule. ] Source: Lennar Homes.

Infrastructure Budget and Status. The following table shows Lennar Homes’ estimated uses of funds for the construction of the backbone infrastructure and in -tract ITEM 19.3.

ATTACHMENT 4

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infrastructure needed for the entire Grantline 220 project, consisting of the 209 lots within Improvement Area No. 1 and the 364 lots within Improvement Area No. 2. A portion of these costs are eligible for reimbursement from the proceeds of the Bonds and other District sources.

All lots within Improvement Area No. 2 are now in “finished lot” condition. Only the taxable property within Improvement Area No. 2 constitutes security for the Bonds.

Table 2
Improvement Area No. 2 of City of Rancho Cordova
Grantline 220 Community Facilities District No. 2023-1
Lennar Homes – Infrastructure Budget and Status for Grantline 220 Project As of October 1, 2024

Budget
Spent
as of 10/1/2024 Balance
%
Complete
CFD/ Credit/
Reimb(1)
Received as
of 10/1/24 Balance
Intracts $53,901,055.00 $53,155,945.83 $745,109.17 98.62% -$22,117,570.00 -$226,563.27 -$21,891,006.73 Water/Sewer/Drainage $10,374,907.00 $3,538,814.71 $6,836,092.29 34.11% -$7,531,325.00 -$350,965.03 -$7,180,359.97 Offsite Roads $19,516,981.00 $18,007,615.48 $1,509,365.52 92.27% -$15,186,102.00 -$4,067,033.08 -$11,119,068.92 ______________________
(1) Represents anticipated credits against impact fees payable by Lennar Homes in future or anticipated reimbursement to Lennar Homes for facilities included in the City capital improvement program (CIP) .

Source: Lennar Homes.

Although Lennar Homes expects to have sufficient funds available to complete its development in Improvement Area No. 2 as described in this Official Statement, there can be no assurance that amounts necessary to finance the development costs will be available from Lennar Homes or any other source when needed. Neither Lennar Homes, nor any of its related entities are under any legal obligation of any kind to expend funds for the development of and construction of homes on its property in Improvement Area No. 2. Any contributions by Lennar Homes or any related parties to fund the costs of such development are entirely voluntary.

If and to the extent that internal funding is inadequate to pay the costs to complete the planned development by Lennar Homes within Improvement Area No. 2 and other financing is not put into place, there could be a shortfall in the funds required to complete the planned development by Lennar Homes in Improvement Area No. 2.

Except as described in this Official Statement and except for those consents, permits, authorizations, certifications and approvals of governmental entities required in the ordinary course of development, Lennar Homes has no actual knowledge of any impediment to construction or obtaining land use entitlements which could be reasonably expected to have a material adverse effect on its ability to complete the planned development of its property within Improvement Area No. 2 as described in the Official Statement. Although the information in this Official Statement reflects the current development expectations of the Developer, no assurance can be given that lot acquisition from the Land Bank Owner or home construction and sales will be carried out on the schedule and according to the plans described herein, or that the lot acquisition from the Land Bank Owner or home construction and sale plans or base prices set forth herein will not change after the date of this Official Statement. The Developer reserves the right to change its development at any time without notice. Additionally, homes under contract to be sold may not result in closed escrows as sales contracts are subject to cancellation.

ITEM 19.3.

ATTACHMENT 4

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THE FACILITIES

Eligible Facilities

The Facilities eligible to be financed by the District are set forth in the Resolution of Formation and consist of roadway and transportation improvements, including roadway design, project management, grading, and construction of roadways, including curbs, gutters, sidewalks, pavement, street lighting, dry utilities, soundwalls and landscaping, as well as drainage facilities, park improvements and other miscellaneous improvements. Authorized Facilities also include sanitary sewer facilities, water facilities and other capital improvements for which developer impact fees are payable to the City and other local agencies for development within the District, as well as incidental expenses as authorized by the Mello-Roos Act.

The proceeds of the Bonds will be used for a portion of the cost of the public improvements (and/or development impact fees) eligible to be financed with the proceeds of the Bonds (the “Facilities,” as described below). See “FINANCING PLAN” and “See “IMPROVEMENT AREA NO. 2 - Development in Improvement Area No. 2 - Infrastructure Budget and Status” above for details on estimated costs of Facilities, costs and reimbursements as of dates noted.

Acquisition by the City and other Local Agencies

In connection with the issuance of special tax bonds for Improvement Area No. 1 , the City and Lennar Homes executed a Funding, Construction and Acquisition Agreement dated as of April 1, 2024 ( the “Acquisition Agreement” ) which provides that Lennar Homes (or successors) will construct (or cause to be constructed or funded) the Facilities. As components of the Facilities are completed or development impact fees are paid by Lennar Homes to the City, proceeds of a portion of the Bonds and other special tax bonds issued for the District will be used to pay all or a part of the purchase price of various Facilities and/or reimburse said development impact fees pursuant to the terms of the Acquisition Agreement. The portion of the cost of construction of the Facilities , which will not be provided from bond proceeds, will be the responsibility of Lennar Homes.

The City has entered into joint community facilities agreements with the Cordova Recreation and Park District , the Sacramento County Water Agency (SCWA), and the Sacramento Regional County Sanitation District so that a portion of the proceeds of the Bonds and other special tax bonds issued for the District may finance the development impact fees and/or Facilities to be acquired by those local agencies.

The Special Tax Formula provides that the funding of Improvement costs can also be made from collections of the Special Tax available as the “pay-as-you-go” component of Special Taxes. The pay-as-you-go funding component is expected to provide for funding of the cost of a portion of the Facilities (both improvements and fees) in excess of the amount provided from bond proceeds (if such proceeds are not sufficient) through annual Special Tax collections in excess of the amount needed to pay the debt service. The Acquisition Agreement contemplates the possibility of pay-as-you-go funding for 10 years.

OWNERSHIP OF PROPERTY WITHIN IMPROVEMENT AREA NO. 2
ITEM 19.3.

ATTACHMENT 4

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Unpaid Special Taxes do not constitute a personal indebtedness of the owners of the parcels within Improvement Area No. 2. There is no assurance that an owner or any subsequent owners have the ability to pay the Special Taxes or that, even if they have the ability, they will choose to pay such taxes. An owner may elect to not pay the Special Taxes when due and cannot be legally compelled to do so. Neither the City nor any Bondowner will have the ability at any time to seek payment directly from the owners of property within Improvement Area No. 2 of the Special Tax or the principal or interest on the Bonds, or the ability to control who becomes a subsequent owner of any property within Improvement Area No. 2.

Lennar Homes has provided the respective information set forth under the heading “OWNERSHIP OF PROPERTY WITHIN IMPROVEMENT AREA NO. 2” below. No assurance can be given that all information is complete. No assurance can be given that development of the property will be completed, or that it will be completed in a timely manner. The Special Taxes are not personal obligations of Lennar Homes or of any subsequent landowners; the Bonds are secured only by the Special Taxes and moneys available under the Fiscal Agent Agreement. See “SECURITY FOR THE BONDS” and “BOND OWNERS’ RISKS” herein.

Current Ownership. As noted above, Lennar Homes has been and continues to facilitate lot development in the District through a land-banking with the Land Bank Owner . As of October 1, 2024, 276 lots had been taken down by Lennar within the District, with the ____ remaining lots within Improvement Area No. 2 anticipated to be taken down by Lennar Homes per the negotiated take-down option schedule described above. See “– IMPROVEMENT AREA NO. 2 – Development in Improvement Area No. 2 - Land-Banking Arrangement With AG.”

Home sales in Improvement Area No. 1 of the District began in May 2024. As of October 1, 2024, of the 573 homes planned for the District, ____ homes are owned by individual homeowners, with ____ sold and closed homes in Improvement Area No. 1 and 70 in Improvement Area No. 2. Only the taxable property within Improvement Area No. 2 constitutes security for the Bonds.

Land Bank Owner. The Land Bank Owner is an affiliate of, and managed by, Angelo Gordon & Co., L.P. (“Angelo Gordon ”). Angelo Gordon is a privately -held alternative investment firm founded in 1988 and headquartered in New York, with associated offices across the United States, Europe and Asia. Angelo Gordon manages approximately $52 billion across a broad range of credit and real estate strategies. Affiliates of the Land Bank Owner have entered into land banking arrangements with Lennar Corporation and its affiliated entities on more than 200 residential development projects. Neither the Land Bank Owner nor Angelo Gordon is a developer or a merchant builder.

Lennar Homes. Lennar Homes is based in Irvine, California. Lennar Homes has been in the business of developing residential real estate communities in California since 1996. On February 1, 2022, Lennar Homes of California, Inc., a California corporation, was converted to a California limited liability company and is now (on and after February 1, 2022) known as Lennar Homes of California, LLC, a California limited liability company (“Lennar Homes”).

ITEM 19.3.

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Lennar Homes is wholly-owned by U.S. Home, LLC, a Delaware limited liability company (“U.S. Home”). U.S. Home is wholly -owned by Lennar Corporation, which is based in Miami, Florida. Founded in 1954, Lennar Corporation completed its initial public offering in 1971 and listed its common stock on the New York Stock Exchange in 1972. Lennar Corporation’s Class A and Class B common stock are listed on the New York Stock Exchange under the symbols “LEN” and “LEN.B.” respectively. Lennar Corporation is one of the largest homebuilders in the United States based on home sales revenues and net earnings, and operates under a number of brand names, including Lennar Homes and U.S. Home. Lennar Homes primarily develops residential communities both within the Lennar family of builders and through consolidated and unconsolidated partnerships in which Lennar Homes maintains an interest.

Lennar Corporation is subject to the informational requirements of the Exchange Act and in accordance therewith files reports, proxy statements and other information with the SEC.

Such filings, particularly the Annual Report on Form 10 -K and its most recent Quarterly Report on Form 10-Q, set forth, among other things, certain data relative to the consolidated results of operations and financial position of Lennar Corporation and its consolidated subsidiaries, including Lennar Homes, as of such dates.

The SEC maintains a website that contains reports, proxy and other information statements and other information regarding registrants that file electronically with the SEC, including Lennar Corporation. The address of such website is www.sec.gov. All documents filed by Lennar Corporation pursuant to the requirements of the Exchange Act after the date of this Periodic Report will be available for inspection in such manner as the SEC prescribes.

Copies of Lennar Corporation’s Annual Report and related financial statements, prepared in accordance with generally accepted accounting standards, are available from Lennar Corporation’s website at www.lennar.com. The foregoing website addresses and references to filings with the SEC are given for reference and convenience only, and the information on such websites and on file with the SEC does not form a part of this Official Statement and is not incorporated by reference herein. No representation is made in this Official Statement as to the accuracy or adequacy of the information contained on such websites.

Lennar Corporation and Lennar Homes are not obligated to advance funds for construction or development or to pay ad valorem property taxes or the Special Taxes and investors should not rely on the information and financial statements contained on such websites in evaluating whether to buy, hold or sell the Bonds. The information contained on such websites may be incomplete or inaccurate and has not been reviewed by the City or the Underwriter.

ITEM 19.3.

ATTACHMENT 4

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VALUE OF PROPERTY WITHIN IMPROVEMENT AREA NO. 2

Assessed Values and Building Permits

The following table shows the assessed valuation of taxable property within Improvement Area No. 2 for Fiscal Year 2024-25. Given the ongoing development of land within Improvement Area No. 2, the City has ordered an appraisal of such land, as described below under “– Appraised Values.” The following table also provides the number of building permits issued.

Table 3
Improvement Area No. 2 of City of Rancho Cordova
Grantline 220 Community Facilities District No. 2023-1
Fiscal Year 2024-25 Assessed Valuation

Fiscal
Year
Land
Assessed
Value
Improvement
Assessed
Value
Total
Assessed
Value
Number of
Permits
Issued(1)(2)
2024-25 $50,876,400 $0 $50,876,400 192

(1) Represents the number of parcels for which a building permit for new construction was issued prior to June 1 of the prior fiscal year. As of June 1, 2024, 192 building permits have been pulled.
(2) As of October 1 2024, 338 building permits have been issued.

Sources: Sacramento County Assessor's Office; Goodwin Consulting Group, Inc.

Appraised Values

General. The value of taxable property within Improvement Area No. 2 is a critical factor in determining the investment quality of the Bonds. In order to obtain a more accurate estimate of the value of land in Improvement Area No. 2, the City ordered preparation of an appraisal report dated September 26, 2024 (the “Appraisal”), of the estimated value of the taxable land within Improvement Area No. 2 as of the August 6 , 2024 date of value. The Appraisal was prepared by Integra Realty Resources, Sacramento, California (the “ Appraiser”). The Appraisal is set forth in APPENDIX B hereto. The description herein of the Appraisal is intended for limited purposes only; the Appraisal should be read in its entirety. The conclusions reached in the Appraisal are subject to certain assumptions, conditions and qualifications which are set forth in the Appraisal.

The Appraisal estimated the market value of all of the land in Improvement Area No. 2, which, as of the August 6, 2024 date of value, consists of 364 single family home parcels, some with completed homes or homes under construction, as determined by the Appraiser.

Value Estimate . The appraised valuation excludes the value of all portions of the property in Improvement Area No. 2 designated for public and quasi -public purposes and assumes completion of infrastructure funded by the Bonds and accounts for the impact of the lien of the Special Tax. The following estimate represents the market value of the property to be subject to the Special Tax, based on the hypothetical condition that certain proceeds of the Bonds are available to finance certain improvements and/or fees.

The value estimate for the property as of the date of value of August 6, 2024, using the methodologies described in the Appraisal and subject to the limiting and hypothetical conditions ITEM 19.3.

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and general and special assumptions set forth in the Appraisal is $104,017,000. The valuation estimate is a “not- less-than” market value with respect to the completed single -family homes, based on the smallest floor plan being marketed within each community with a completed home (Viridant II and Midori at Pradera Ranch). See valuation details related to construction status in Table 4.

Valuation Methodology. The market value of the appraised property was estimated by utilizing the sales comparison approach and land residual analysis to value of the subject ’s lots.

In valuing the subject lots, the Appraiser selected benchmark lot categories. In the sales comparison approach, adjustments were applied to the prices of comparable bulk lot transactions, and a market value for the benchmark lot categories were concluded. Finally, the Appraiser utilized a land residual analysis, which was reconciled with the sales comparison approach conclusion. In the land residual analysis (a variation of the cost approach and income capitalization approaches combined), all direct and indirect costs are deducted from an estimate of the anticipated gross sales price of the improved product; the resultant net sales proceeds are then discounted to present value at an anticipated rate over the development and absorption period to indicate the residual value of the lots.

For the homes with various options of the number of bedrooms or bathrooms, consistent with the “not-less-than” valuation, the Appraiser utilized the lesser of the two options. It is noted in the Appraisal that some of the comparables have a significant amount of incentives. These incentives are typical in the current market with homebuilders offering incentives towards options, closing costs, and/or buying down the interest rates. The Appraiser notes that Lennar Homes has been offering significant incentives on their projects in the region to increase the pace of absorption, while likely leaving some profit in favor of a quicker pace of absorption. This has forced surrounding communities to compete with Lennar Homes and offer a similar level of incentives in order to capture a typical level of market share. The analysis of the smallest floor plans in Viridian II and Midori at Pradera Ranch in the Appraisal considered the incentives offered for each comparable. The floor plans within the communities are shown in the Appraisal.

Hypothetical Condition. The market value estimated by the Appraiser is based on a hypothetical condition. A hypothetical condition is defined by USPAP as “a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results but is used for the purpose of the analysis.” It is a hypothetical condition of the Appraisal that the proceeds from the Bonds will be used to fund certain improvements and/or fees. The estimate of market value accounts for the impact of the lien of the Special Taxes securing the Bonds.

Assumptions and Limiting Conditions . In considering the estimate of value evidenced by the Appraisal, the Appraisal is based upon a number of limiting conditions and standard and extraordinary assumptions which affect the estimates as to value, including, among others, the following.

• The value conclusions are based on the following hypothetical conditions that may affect the assignment results. A hypothetical condition is a condition contrary to known fact on the effective date of the appraisal but is supposed for the purpose of analysis. The value conclusions are subject to the following extraordinary assumptions that may affect the assignment results. An extraordinary assumption is uncertain information accepted as fact. If the assumption is found to be false as of the effective date of the appraisal, The Appraiser reserves the right to modify the value conclusions.

ITEM 19.3.

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• The valuation analysis did not include review of a current title report of all properties to determine any possible conditions of title affecting the properties appraised. The Appraiser accepts no responsibility for matters pertaining to title.

• The Appraiser has also assumed that there is no hazardous material on or in the property that would cause a loss in value. Should future conditions and events involving hazardous material reduce the level of permitted development or delay the completion of any projected development, the value of the undeveloped land would likely be reduced from that estimated by the Appraiser. See “BOND OWNERS ’ RISKS – Land Values” and “ – Hazardous Substances” below. See “APPENDIX B – The Appraisal” hereto for a description of certain assumptions made by the Appraiser.

Accordingly, because the Appraiser arrived at an estimate of current market value based upon certain conditions and assumptions which may or may not be fulfilled, no assurance can be given that should the parcels become delinquent due to unpaid Special Taxes, and be foreclosed upon and offered for sale for the amount of the delinquency, that any bid would be received for such property or, if a bid is received, that such bid would be sufficient to pay such delinquent Special Taxes.

Limitations of Appraisal Valuation. Property values may not be evenly distributed throughout Improvement Area No. 2; thus, certain parcels may have a greater value than others. This disparity is significant because in the event of nonpayment of the Special Tax, the only remedy is to foreclose against the delinquent parcel.

No assurance can be given that the foregoing valuation can or will be maintained during the period of time that the Bonds are outstanding in that the City has no control over the market value of the property within Improvement Area No. 2 or the amount of additional indebtedness that may be issued in the future by other public agencies, the payment of which, through the levy of a tax or an assessment, may be on a parity with the Special Taxes. See “ –Priority of Lien” below.

For a description of certain risks that might affect the assumptions made in the Appraisal, see “BOND OWNERS’ RISKS” herein.

Value to Special Tax Burden Ratios

The principal amount of the direct and overlapping debt in Improvement Area No. 2 is $18,506,999*, which consists of the estimated amount of Bonds ($17,500,000*) and $1,006,999 of overlapping CFD bond debt. Consequently, the estimated value of property in Improvement Area No. 2 subject to the Special Tax lien ($ 104,017,000), is approximately 5.6* times the principal amount of the direct and overlapping debt in Improvement Area No. 2. This is an average and individual parcels may vary considerably from this average.

* Preliminary, subject to change.

ITEM 19.3.

ATTACHMENT 4

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In comparing the value of the real property within Improvement Area No. 2 to the principal amount of the Bonds and other direct and overlapping debt for Improvement Area No. 2, it should be noted that only the real property upon which there is a delinquent Special Tax can be foreclosed upon, and the real property within Improvement Area No. 2 cannot be foreclosed upon as a whole to pay delinquent Special Taxes of the owners of such parcels within Improvement Area No. 2 unless all of the property is subject to a delinquent Special Tax.

In any event, individual parcels may be foreclosed upon separately to pay delinquent Special Taxes levied against such parcels.

Other public agencies whose boundaries overlap those of Improvement Area No. 2 could, without the consent of the City and in certain cases without the consent of the owners of the land within Improvement Area No. 2, impose additional taxes or assessment liens on the land within Improvement Area No. 2. The purpose would be to finance additional regional or local public improvements or services. The lien created on the land within Improvement Area No. 2 through the levy of such additional taxes or assessments may be on a parity with the lien of the Special Tax. In addition, construction loans may be obtained by the developers of property in Improvement Area No. 2 or home loans may be obtained by ultimate homeowners.

The deeds of trust securing such debt on property within Improvement Area No. 2, however, will be in a junior position to the lien of the Special Tax. See “– Priority of Lien,” below.

ITEM 19.3.

ATTACHMENT 4

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Value-to-lien Ratios by Development Status. The following table shows the projected status of development and value-to- lien ratios by village in Improvement Area No. 2 for fiscal year 2025-26, based on the status of development as of August 6, 2024 and assuming no further development. Value-to-lien ratios on individual parcels may vary considerably from any average.

Table 4
Improvement Area No. 2 of City of Rancho Cordova Grantline 220 Community Facilities District No. 2023-1 Value-to-Lien Ratios by Development Status – Projected for Fiscal Year 2025-26

Appraisal Status (1)

No. of
Units
Appraised
Value (2)
Projected
FY 2025-26
Maximum
Special Tax*
Projected
FY 2025-26
Special Tax
Levy (3)*
Percent of
Projected
Special Tax
Levy*
CFD
Bonds (4)*
Overlapping
Debt (5)*
Total
Debt*
Average
Appraised
Value-to-
Lien*
Lennar Homes
Partially-Improvd Lots
Olive Grove 25 $5,500,000 $51,994 $23,810 2.5% $441,279 $68,795 $506,999 10.8 : 1 Verdant II 4 $880,000 $9,572 $4,383 0.5% $81,236 $11,056 $91,726 9.6 : 1 Viridian II 11 $2,420,000 $29,767 $13,631 1.4% $252,634 $28,482 $279,355 8.7 : 1 Celedon 12 $2,760,000 $34,583 $15,836 1.7% $293,504 $33,545 $325,007 8.5 : 1 Midori 13 $3,146,000 $48,231 $22,086 2.3% $409,335 $35,933 $442,420 7.1 : 1

Finished Lots with
Permits and Fees Paid

Verdant II 8 $2,225,000 $19,143 $19,143 2.0% $352,099 $22,112 $374,438 5.9 : 1 Viridian II 4 $1,112,000 $10,824 $10,824 1.1% $199,089 $10,357 $209,574 5.3 : 1 Midori 39 $11,704,000 $144,692 $144,692 15.2% $2,661,293 $113,363 $2,776,366 4.2 : 1

Homes Under
Construction

Olive Grove 53 $14,739,000 $110,227 $110,227 11.6% $2,027,385 $144,584 $2,173,272 6.8 : 1 Verdant II 28 $7,787,000 $67,002 $67,002 7.0% $1,232,348 $77,393 $1,310,533 5.9 : 1 Viridian II 38 $10,568,000 $102,831 $102,831 10.8% $1,891,348 $98,393 $1,990,956 5.3 : 1 Celedon 48 $13,829,000 $138,331 $138,331 14.5% $2,544,294 $134,180 $2,680,108 5.2 : 1 Jade 40 $11,364,000 $131,964 $131,964 13.9% $2,427,183 $110,758 $2,539,501 4.5 : 1 Midori 27 $8,103,000 $100,172 $100,172 10.5% $1,842,433 $78,923 $1,922,540 4.2 : 1

Subtotal
350 $96,137,000 $999,333
$904,933

95.2% $16,655,460 $967,877 $17,622,795 5.5 : 1

Individ. Homeowners
Completed Homes
Viridian II 6 $3,120,000 $16,236 $16,236 1.7% $298,634 $15,536 $314,361 9.9 : 1 Midori 8 $4,760,000 $29,680 $29,680 3.1% $545,906 $23,586 $569,843 8.4 : 1 Subtotal 14 $7,880,000 $45,917 $45,917 4.8% $844,540 $39,122 $884,204 8.9 : 1

Total 364 $104,017,000 $1,045,251 $950,850 100.0% $17,500,000 $1,006,999 $18,506,999 5.6 : 1

(Footnotes on Following Page)
ITEM 19.3.

ATTACHMENT 4

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* Preliminary; subject to change.
(1) Appraisal status based on the Appraisal Report and as of the August 6, 2024 date of value. (2) Appraised values were allocated to the individual parcels based on the expected development and lot status for each parcel, as reported in the Appraisal. The allocated appraised values are not indicative of the market values of the communities or the individual lots. (3) Includes building permits issued prior to August 6, 2024, final maps recorded prior to June 30, 2024, and assumes no further development. Includes debt service due in 2026 on the Series 2024 Special Tax Bonds and estimated administrative expenses in the amount of $30,600. (4) Includes the $17,500,000 par amount of the Series 2024 Special Tax Bonds. Allocated based on the Projected FY 2025-26 Special Tax Levy. (5) Includes the overlapping debt liens listed under "Direct and Overlapping Tax and Assessment Debt" in the overlapping debt report prepared by California Municipal Statistics, Inc. The overlapping debt report is based on the parcels and assessed value as of FY 2023-24. Does not include any PACE liens secured by assessments or special taxes on the property.

Sources: Integra Realty Resources, Inc.; Piper Sandler & Co.; California Municipal Statistics, Inc.; Goodwin Consulting Group, Inc.

ITEM 19.3.

ATTACHMENT 4

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Value-to-lien Ratios By Category. The following table sets forth the projected value- to-lien ratios by category for parcels in Improvement Area No. 2 for Fiscal Year 2025-26.

Table 5
Improvement Area No. 2 of City of Rancho Cordova
Grantline 220 Community Facilities District No. 2023-1
Value-to-Lien Ratio Ranges – Projected for Fiscal Year 2025-26

Appraised
Value-to-Lien
Category
No. of
Parcels*
Appraised
Value (1)
Projected
FY 2025-26
Special Tax
Levy (2)*
Percent of
Projected
Special Tax
Levy*
CFD
Bonds(3)*
Overlapping
Debt (4)* Total Debt*
Average
Appraised
Value-to-
Lien*
10:1 to 15:1 25 $5,500,000 $23,810 2.5% $438,204 $68,795 $506,999 10.8 : 1 5:1 to 10:1 233 $67,346,000 $550,213 57.9% $10,126,434 $635,159 $10,761,593 6.3 : 1 3:1 to 5:1 106 $31,171,000 $376,828 39.6% $6,935,362 $303,045 $7,238,407 4.3 : 1 Total 364 $104,017,000 $950,850 100.0% $17,500,000 $1,006,999 $18,506,999 5.6 : 1

* Preliminary; subject to change.
(1) Appraised values were allocated to the individual parcels based on the expected development and lot status for each parcel, as reported in the Appraisal. The allocated appraised values are not indicative of the market values of the communities or the individual lots. (2) Includes building permits issued prior to August 6, 2024, final maps recorded prior to June 30, 2024, and assumes no further development.

Includes debt service due in 2026 on the Series 2024 Special Tax Bonds and estimated administrative expenses in the amount of $30,600. (3) Includes the $17,500,000 par amount of the Series 2024 Special Tax Bonds. Allocated based on the Projected FY 2025 -26 Special Tax levy. (4) Includes the overlapping debt liens listed under "Direct and Overlapping Tax and Assessment Debt" in the overlapping debt rep ort prepared by California Municipal Statistics, Inc. The overlapping debt report is based on the parcels and assessed value as of FY 2023 -24. Does not include any PACE liens secured by assessments or special taxes on the property.

Sources: Integra Realty Resources, Inc.; Piper Sandler & Co.; California Municipal Statistics, Inc.; Goodwin Consulting Group , Inc.

Priority of Lien

The principal of and interest on the Bonds are payable from the Special Tax authorized to be collected within Improvement Area No. 2, and payment of the Special Tax is secured by a lien on certain real property within Improvement Area No. 2. Such lien is co -equal to and independent of the lien for general taxes and any other liens imposed under the Mello-Roos Act, regardless of when they are imposed on the property in Improvement Area No. 2. The imposition of additional special taxes, assessments and general property taxes will increase the amount of independent and co-equal liens which must be satisfied in foreclosure. The City, the County and certain other public agencies are authorized by the Mello -Roos Act to form other community facilities districts and improvement areas and, under other provisions of State law, to form special assessment districts, either or both of which could include all or a portion of the land within Improvement Area No. 2. In addition, property owners can voluntarily agree to incur Property Assessed Clean Energy (PACE) liens on their properties.

There can be no assurance that the developers will not petition for the formation of other community facilities districts and improvement areas or for a special assessment district or districts and that parity special taxes or special assessments will not be levied by the County or some other public agency to finance additional public facilities, however no other special districts are currently contemplated by the City or the developers.

Private liens, such as deeds of trust securing loans obtained by developers of land in Improvement Area No. 2, may be placed upon property in Improvement Area No. 2 at any time.

Under California law, the Special Taxes have priority over all existing and future private liens imposed on property subject to the lien of the Special Taxes.

ITEM 19.3.

ATTACHMENT 4

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Set forth below is a statement of direct and overlapping public bonded debt (the “Overlapping Debt Report ”) prepared by California Municipal Statistics, Inc. The Overlapping Debt Report includes only such information as has been reported to California Municipal Statistics, Inc. by the issuers of the debt described therein and by others. The Overlapping Debt Report is included for general informational purposes only. Neither the City nor the Underwriter makes any representation as to its completeness or accuracy.

The first column in the table names each public agency which has outstanding bonded debt as of the date of the report and whose territory overlaps Improvement Area No. 2 in whole or in part. The second column shows the assessed value of the area common to Improvement Area No. 2 and the other public agency (overlapping territory), as a percentage of the total assessed value of the other public agency. This percentage, multiplied by the total outstanding bonded debt of each overlapping agency (which is not shown in the table) produces the amount shown in the third column, which is the apportionment of each overlapping agency’s outstanding debt to taxable property in Improvement Area No. 2. In addition to the bonded debt shown in the Overlapping Debt Report, various local agencies, including the City, levy additional parcels charges, assessments and special taxes on parcels in Improvement Area No. 2. See Table 7 for estimated amounts of these parcel charges, assessments and special taxes for Fiscal Year 2025-26.

ITEM 19.3.

ATTACHMENT 4

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The Overlapping Debt Report does not include PACE debt secured by assessments or special taxes on any property.

Table 6
Improvement Area No. 2 of City of Rancho Cordova
Grantline 220 Community Facilities District No. 2023-1
Direct and Overlapping Indebtedness
As of September 1, 2024

2023-24 Local Secured Assessed Valuation: $17,618,576

DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT: % Applicable Debt 9/1/24 Los Rios Community College District General Obligation Bonds 0.007% $ 23,205 Elk Grove Unified School District General Obligation Bonds 0.035 148,280 Elk Grove Unified School District Community Facilities District No. 1 0.435 835,513 California Municipal Finance Authority Community Facilities District No. 2023-1, IA 2 City of Rancho Cordova Grantline 220 100. 0 (1) TOTAL DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT $1,006,998

OVERLAPPING GENERAL FUND DEBT:

Sacramento County General Fund Obligations 0.008% $ 8,323 Sacramento County Pension Obligation Bonds 0.008 24,541 Sacramento County Board of Education Certificates of Participation 0.008 131 Elk Grove Unified School District Certificates of Participation 0.035 3,679 City of Rancho Cordova Certificates of Participation 0.140 15,871 Sacramento Metropolitan Fire General Fund Obligations 0.020 1,397 Sacramento Metropolitan Fire Pension Obligation Bonds 0.020 4,520 Cordova Recreation and Park District General Fund Obligations 0.088 4,937 TOTAL GROSS OVERLAPPING GENERAL FUND DEBT $63,399
Less: Sacramento County supported obligations 879 TOTAL NET OVERLAPPING GENERAL FUND DEBT $62,520

GROSS COMBINED TOTAL DEBT $1,070,397 (2)
NET COMBINED TOTAL DEBT $1,069,518

(1) Excludes Mello-Roos Act bonds to be sold.
(2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non -bonded capital lease obligations.

Ratios to 2023-24 Local Secured Assessed Valuation:

Direct Debt ($0) ........................................................................... 0.00% Total Direct and Overlapping Tax and Assessment Debt ............. 5.72% Gross Combined Total Debt ......................................................... 6.08% Net Combined Total Debt ............................................................. 6.07% _______________
(1) Bonds to be sold.
(2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non-bonded capital lease obligations.

Source: California Municipal Statistics, Inc.

As indicated in the table, land in Improvement Area No. 2 is within the Elk Grove Unified School District and subject to tax for payment of a portion of its general obligation bonds and Community Facilities District No. 1 bonds. The school district has remaining bond authorizations for both. The original authorization for the general obligation bonds is $476.0 million and the current unused authorization is $132.4 million. The authorization for the Community Facilities District No. 1 bonds is $275 million and the current unused authorization is approximately $51.9 ITEM 19.3.

ATTACHMENT 4

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million. In addition, the school district has placed Measure N on the November 2024 ballot, which, if approved by the voters, would authorize the school district to issue an additional $542 million of general obligation bonds.

With respect to the Elk Grove Unified School District community facility district, an annual special tax of $200 per parcel will be levied following issuance of a building permit. As additional development occurs in Improvement Area No. 2 the Elk Grove USD CFD lien amount may be larger than what is shown.

ITEM 19.3.

ATTACHMENT 4

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Estimated Tax Burden on a Single-Family Home

The following table sets forth the estimated total tax burden on a single -family home, based on projected tax rates for Fiscal Year 2024-25.

Table 7
Improvement Area No. 2 of City of Rancho Cordova
Grantline 220 Community Facilities District No. 2023-1
Sample Tax Bill – Fiscal Year 2024-25

Tax Zone 1 Tax Zone 2 Tax Zone 3 Tax Zone 4 Tax Zone 5 Tax Zone 6 Net Taxable Value Amount Amount Amount Amount Amount Amount Estimated Market Values (1) $548,000.00 $600,000.00 $627,000.00 $657,000.00 $703,000.00 $765,000.00 Less: Homeowner's Exemption (7,000.00) (7,000.00) (7,000.00) (7,000.00) (7,000.00) (7,000.00) Net Taxable Value $541,000.00 $593,000.00 $620,000.00 $650,000.00 $696,000.00 $758,000.00 Ad Valorem Property Taxes Rate Amount Amount Amount Amount Amount Amount Base Property Tax 1.0000% $5,410.00 $5,930.00 $6,200.00 $6,500.00 $6,960.00 $7,580.00 Los Rios College General Obligation Bond 0.0318% $172.04 $188.57 $197.16 $206.70 $221.33 $241.04 Elk Grove Unified General Obligation Bond 0.0192% $103.87 $113.86 $119.04 $124.80 $133.63 $145.54 Total Ad Valorem Property Taxes 1.0510% $5,685.91 $6,232.43 $6,516.20 $6,831.50 $7,314.96 $7,966.58 Parcel Charges, Assessments, and Special Taxes (2)(3) Amount Amount Amount Amount Amount Amount Water and Drainage Studies - SCWA 13 $6.92 $6.92 $6.92 $6.92 $6.92 $6.92 Elk Grove USD CFD No. 1 $200.00 $200.00 $200.00 $200.00 $200.00 $200.00 Rancho Cordova CFD No. 2018 -2 $139.62 $139.62 $139.62 $139.62 $139.62 $139.62 CRPD CFD No. 2018-1 $485.44 $485.44 $485.44 $485.44 $485.44 $485.44 Transit Related Services Zone 2 $132.85 $132.85 $132.85 $132.85 $132.85 $132.85 Rancho Cordova Lighting District 2012 -1 $2.56 $2.56 $2.56 $2.56 $2.56 $2.56 Rancho Cordova CFD 2014-2 $555.60 $555.60 $555.60 $555.60 $555.60 $555.60 Rancho Cordova CFD No. 2013 -2 $650.62 $650.62 $650.62 $650.62 $650.62 $650.62 Grantline 220 CFD No. 2023-1 (4) $2,038.98 $2,346.00 $2,653.02 $2,825.39 $3,234.41 $3,637.31 Total Parcel Charges, Assessments, and Special Taxes $4,212.59 $4,519.61 $4,826.63 $4,999.00 $5,408.02 $5,810.92 Total Taxes $9,898.50 $10,752.04 $11,342.83 $11,830.50 $12,722.98 $13,777.50 Total Effective Tax Rate 1.81% 1.79% 1.81% 1.80% 1.81% 1.80%

(1) Represents the estimated home prices for each tax zone provided by the developer. (2) Based on fiscal year 2023-24 charges identified on the Sacramento County -issued property tax bills. Charges subject to change in future years. (3) Does not include any PACE assessments or special taxes. (4) Equal to the applicable Maximum Special Tax rate in F iscal Year 2024-25.

Sources: Sacramento County Assessor's Office; Goodwin Consulting Group, Inc.

ITEM 19.3.

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Special Tax Collections and Delinquencies

Fiscal Year 2024-25 is the first fiscal year during which the Special Tax will be levied, with the first payment due in December 2024. Accordingly, there is no history of collections and delinquencies. The levy of Special Taxes in Improvement Area No. 2 is currently covered by the Teeter Plan in the County. There can be no assurance that Sacramento County will not modify or eliminate its Teeter Plan, or choose to remove the District, Improvement Area No. 2 or individual parcels from its Teeter Plan; se e “SECURITY FOR THE BONDS – Delinquent Payments of Special Tax; Covenant for Superior Court Foreclosure –Teeter Plan.”

BOND OWNERS’ RISKS

The purchase of the Bonds involves a degree of risk that may not be appropriate for some investors. The following includes a discussion of some of the risks that should be considered before making an investment decision. This discussion does not purport to be comprehensive or definitive or a complete statement of all factors that may be considered as risks in evaluating the credit quality of the Bonds.

Limited Obligation of the City to Pay Debt Service

The City has no obligation to pay principal of and interest on the Bonds if Special Tax collections are delinquent or insufficient, other than from amounts, if any, on deposit in the Reserve Fund or funds derived from the tax sale or foreclosure and sale of parcels for Special Tax delinquencies. The City is not obligated to advance funds to pay debt service on the Bonds.

Concentration of Ownership

A large portion of the taxable property within Improvement Area No. 2 is currently owned by Lennar Homes or the Land Bank Owner. Although there will be transfers of ownership to additional individual homeowners as development progresses and additional home sales are closed, the timely payment of the Bonds depends upon the willingness and ability of all of the owners of taxable property within Improvement Area No. 2 to pay the Special Taxes when due.

The only assets of the owners of property within Improvement Area No. 2 which constitute security for the Bonds are such owners’ real property holdings located within Improvement Area No. 2, and each parcel may only be foreclosed against for delinquent Special Taxes levied against such parcel. If the current landowners choose to pay some but not all of the Special Taxes, they may, as owners of parcels in Improvement Area No. 2, choose to default on payments of the Special Tax on parcels. Also see “– Bankruptcy Delays” below.

Development of undeveloped property within Improvement Area No. 2 may be subject to unexpected delays, disruptions and changes which may affect the willingness and ability of the homebuilder or other property owners to pay the Special Taxes when due. Certain infrastructure improvements remain to be completed in order for homes to be completed on the timeline currently expected by Lennar Homes. No assurance can be given that the proposed residential development will be partially or fully completed, and for purposes of evaluating the investment quality of the Bonds, prospective purchasers should consider the possibility that such parcels will remain vacant and only partially improved. See the information set forth under the caption “IMPROVEMENT AREA NO. 2.”

ITEM 19.3.

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Levy and Collection of the Special Tax

General. The principal source of payment of principal of and interest on the Bonds is the proceeds of the annual levy and collection of the Special Tax against property within Improvement Area No. 2.

Limitation on Maximum Annual Special Tax Rate. The annual levy of the Special Tax is subject to the maximum annual Special Tax rate authorized in the Special Tax Formula. The levy cannot be made at a higher rate even if the failure to do so means that the estimated proceeds of the levy and collection of the Special Tax, together with other available funds, will not be sufficient to pay debt service on the Bonds.

In addition to the maximum annual Special Tax rate limitation in the Special Tax Formula, Section 53321(d) of the Mello-Roos Act provides that the special tax levied against any parcel for which an occupancy permit for private residential use has been issued may not be increased as a consequence of delinquency or default by the owner of any other parcel within a community facilities district by more than 10% above the amount that would have been levied in such fiscal year had there never been any such delinquencies or defaults. In cases of significant delinquency, these factors may result in defaults in the payment of principal of and interest on the Bonds.

No Relationship Between Property Value and Special Tax Levy. Because the Special Tax Formula is not based on property value, the levy of the Special Tax will rarely, if ever, result in a uniform relationship between the value of particular parcels in Improvement Area No. 2 subject to a Special Tax and the amount of the levy of the Special Tax against those parcels. Thus, there will rarely, if ever, be a uniform relationship between the value of the parcels in Improvement Area No. 2 subject to a Special Tax and their proportionate share of debt service on the Bonds, and certainly not a direct relationship.

Factors that Could Lead to Special Tax Deficiencies. The following are some of the factors that might cause the levy of the Special Tax on any particular parcel of Taxable Property to vary from the Special Tax that might otherwise be expected:

Transfers to Governmental Entities. The number of parcels in Improvement Area No. 2 subject to a Special Tax could be reduced through the acquisition of Taxable Property by a governmental entity and failure of the government to pay the Special Tax based upon a claim of exemption or, in the case of the federal government or an agency thereof, immunity from taxation, thereby resulting in an increased tax burden on the remaining taxed parcels.

Property Tax Delinquencies . Failure of the owners of Taxable Property to pay property taxes (and, consequently, the Special Tax), or delays in the collection of or inability to collect the Special Tax by tax sale or foreclosure and sale of the delinquent parcels, could result in a deficiency in the collection of Special Tax revenues. See “– Property Tax Delinquencies” below.

ITEM 19.3.

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Delays Following Special Tax Delinquencies and Foreclosure Sales . The Fiscal Agent Agreement generally provides that the Special Tax is to be collected in the same manner as ordinary ad valorem property taxes are collected and, except as provided in the special covenant for foreclosure described in “SECURITY FOR THE BONDS – Delinquent Payments of Special Tax; Covenant for Superior Court Foreclosure ” and in the Mello-Roos Act, is subject to the same penalties and the same procedure, sale and lien priority in case of delinquency as is provided for ordinary ad valorem property taxes. Under these procedures, if taxes are unpaid for a period of five years or more, the property is deeded to the State and then is subject to sale by the County.

If sales or foreclosures of property are necessary, there could be a delay in payments to owners of the Bonds pending such sales or the prosecution of foreclosure proceedings and receipt by the City of the proceeds of sale if the Reserve Fund is depleted . See “SECURITY FOR THE BONDS – Delinquent Payments of Special Tax; Covenant for Superior Court Foreclosure.”

The ability of the City to collect interest and penalties specified by State law and to foreclose against properties having delinquent Special Tax installments may be limited in certain respects with regard to properties in which the Federal Deposit Insurance Corporation (the “FDIC”) has or obtains an interest. The FDIC would obtain such an interest by taking over a financial institution that has made a loan that is secured by property within Improvement Area No. 2. See “ – FDIC/Federal Government Interests in Properties” below.

Other laws generally affecting creditors ’ rights or relating to judicial foreclosure may affect the ability to enforce payment of Special Taxes or the timing of enforcement of Special Taxes. For example, the Soldiers and Sailors Civil Relief Act of 1940 affords protections such as a stay in enforcement of the foreclosure covenant, a six -month period after termination of military service to redeem property sold to enforce the collection of a tax or assessment and a limitation on the interest rate on the delinquent tax or assessment to persons in military service if the court concludes the ability to pay such taxes or assessments is materially affected by reason of such service.

Overlapping Tax Districts. The land in Improvement Area No. 2 is also located within the boundaries of various local agencies that could issue debt in the future payable from special taxes or other amounts levied on the parcels in Improvement Area No. 2; this would decrease the value to lien ratios of parcels in Improvement Area No. 2.

Property Tax Delinquencies

General. Delinquencies in the payment of property taxes and, consequently, the Special Taxes, can occur because the owners of delinquent parcels may not have received property tax bills from the County in a timely manner, including situations in which the County initially sent property tax bills to the property developer or merchant builder at a time when the parcels in question had already been sold to individual homeowners. Delinquencies can also reflect economic difficulties and duress by the property owner.

Numerous future delinquencies by the owners of Taxable Property in Improvement Area No. 2 in the payment of property taxes (and, consequently, the Special Taxes, which are collected on the ordinary property tax bills) when due could result in a deficiency in Special Tax Revenues necessary to pay debt service on the Bonds , which could in turn result in the depletion of the Reserve Fund, prior to reimbursement from the resale of foreclosed property or ITEM 19.3.

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payment of the delinquent Special Tax. In that event, there could be a delay or failure in payments of the principal of and interest on the Bonds. See “SECURITY FOR THE BONDS – Reserve Fund, ” and “SECURITY FOR THE BONDS – Delinquent Payments of Special Tax; Covenant for Superior Court Foreclosure.”

The City intends to take certain actions designed to mitigate the impact of future delinquencies, including: enforcing the lien of the Special Taxes through collection procedures that will include foreclosure actions under certain circumstances (see “SECURITY FOR THE BONDS – Delinquent Payments of Special Tax; Covenant for Superior Court Foreclosure”); and increasing the levy of Special Taxes against non -delinquent property owners in Improvement Area No. 2, to the extent permitted under the Special Tax Formula and the Mello-Roos Act and to the extent the Special Taxes are not already being levied at the Maximum Annual Special Tax rate.

Any future decline in home values in Improvement Area No. 2 could result in property owner unwillingness or inability to pay mortgage payments, as well as ad valorem property taxes and Special Taxes, when due. Under such circumstances, bankruptcies are likely to increase. Bankruptcy by homeowners with delinquent Special Taxes would delay the commencement and completion of foreclosure proceedings to collect delinquent Special Taxes.

It is possible that laws could be enacted in the future to assist homeowners in default in the payment of mortgages and property taxes. It is further possible that federal laws could be enacted that would adversely impact the ability of the City to foreclose on parcels with delinquent Special Taxes. No assurance can be given that any such laws will be enacted, or if enacted will be effective in assisting affected homeowners.

Property Values and Risks Related to Development

The value of Taxable Property within Improvement Area No. 2 is a critical factor in determining the investment quality of the Bonds. If a property owner defaults in the payment of the Special Tax, the City ’s only remedy is to foreclose on the delinquent property in an attempt to obtain funds with which to pay the delinquent Special Tax. Land values could be adversely affected by economic and other factors beyond the City ’s control, such as a general economic downturn, relocation of employers out of the area, shortages of water, electricity, natural gas or other utilities, destruction of property caused by earthquake, flood, wildfires, or other natural disasters, environmental pollution or contamination, or unfavorable economic conditions.

The following is a discussion of specific risk factors that could affect the value of property in Improvement Area No. 2.

Current Challenges to the Homebuilding Industry . No assurances can be given that the timing of construction of homes and/or sale of homes to individual homeowners projected by Lennar Homes in this Official Statement will be accomplished. Due to the current state of world affairs, the pace of homebuilding and sale of homes to individual homeowners in Improvement Area No. 2 may be adversely affected by a variety of factors, including rising interest rates, inflation and changes in economic conditions, increas es in certain construction costs, droughts and water shortages or other environmental factors, workforce shortages and supply chain disruptions. For example, mortgage rates have recently hit multi -decade highs. Additionally, homebuilders are currently experiencing a known supply chain disruption with respect to obtaining electrical transformers needed for new development. Further, the recent increases in interest rates may slow the demand for new residential homes and a combination of historically ITEM 19.3.

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high new home prices and rising interest rates may price some homebuyers out of entry -level homes. High inflation could force prospective homebuyers to account for other costs over purchasing a new home at a higher interest rate. See “VALUE OF PROPERTY WITHIN IMPROVEMENT AREA NO. 2 – Appraised Values – Currently Changing Market Conditions” above.

Although such factors are not currently having a significant impact on the overall development of homes in Improvement Area No. 2, the impacts caused by such factors are evolving and no prediction can be made with respect to the ultimate effects of these factors on Lennar Homes ’ ability to sell and close homes in Improvement Area No. 2. These external factors, if and as they arise, could have a material adverse effect on the ability to develop the homes in Improvement Area No. 2 as planned, and no assurance can be provided that Lennar Homes will be able to (a) complete in whole or in any part, or within any particular time, its construction of homes within Improvement Area No. 2; (b) avoid additional material increases in development costs or delays resulting from work stoppages, reduced attendance of workers and shortages or delays in the delivery of building materials; or (c) sell homes, and close home sales or not experience purchase contract cancellations, due to an economic downturn driven by rising interest rates, inflation or other changes in economic conditions.

Natural Disasters. The value of the Taxable Property in the future can be adversely affected by a variety of natural occurrences, particularly those that may affect infrastructure and other public improvements and private improvements on the Taxable Property and the continued habitability and enjoyment of such private improvements.

The areas in and surrounding Improvement Area No. 2, like those in much of California, may be subject to unpredictable seismic activity, including earthquakes. See “IMPROVEMENT AREA NO. 2 – Description and Location.”

Other natural disasters could include, without limitation, floods, wildfires, droughts or tornadoes. One or more natural disasters could occur and could result in damage to improvements of varying seriousness. Although land in Improvement Area No. 2 is not in a high-risk area (or a special fire hazard severity zone) for wildfires, landslides, floods, or tornadoes, natural disasters such as these are unpredictable and may occur anywhere throughout the State, with devastating consequences. In particular, large fires have impacted other parts of the City and County in recent years. The damage may entail significant repair or replacement costs and that repair or replacement may never occur either because of the cost, or because repair or replacement will not facilitate habitability or other use, or because other considerations preclude such repair or replacement. Under any of these circumstances there could be significant delinquencies in the payment of Special Taxes, and the value of the Taxable Property may well depreciate or disappear.

Droughts. The State is subject from time -to-time to drought conditions, which could have an impact on future development in Improvement Area No. 2. Drought conditions have been present in the State numerous times in the recent past. Although much of the State, including property in the City, is now out of the worst drought category, the City cannot predict when worsening drought conditions and concomitant water -reduction requirements will return, what effect drought conditions could have on property values, or whether or to what extent water reduction requirements may affect the development of Improvement Area No. 2.

Legal Requirements . Other events that may affect the value of Taxable Property include changes in the law or application of the law. Such changes may include, without ITEM 19.3.

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limitation, local growth control initiatives, local utility connection moratoriums and local application of statewide tax and governmental spending limitation measures.

Hazardous Substances . One of the most serious risks in terms of the potential reduction in the value of Taxable Property is a claim with regard to a hazardous substance. In general, the owners and operators of Taxable Property may be required by law to remedy conditions of the parcel relating to releases or threatened releases of hazardous substances.

The federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, sometimes referred to as “CERCLA” or the “Superfund Act,” is the most well-known and widely applicable of these laws, but California laws with regard to hazardous substances are also stringent and similar. Under many of these laws, the owner or operator is obligated to remedy a hazardous substance condition of property whether or not the owner or operator has anything to do with creating or handling the hazardous substance. The effect, therefore, should any of the Taxable Property be affected by a hazardous substance, is to reduce the marketability and value of the parcel by the costs of remedying the condition, because the purchaser, upon becoming owner, will become obligated to remedy the condition.

The property values set forth in this Official Statement do not take into account the possible reduction in marketability and value of any of the Taxable Property by reason of the possible liability of the owner or operator for the remedy of a hazardous substance condition of the parcel. Although the City is not aware that the owner or operator of any of the Taxable Property has such a current liability with respect to any of the Taxable Property, it is possible that such liabilities do currently exist and that the City is not aware of them.

Further, it is possible that liabilities may arise in the future with respect to any of the Taxable Property resulting from the existence, currently, on the parcel of a substance presently classified as hazardous but that has not been released or the release of which is not presently threatened, or may arise in the future resulting from the existence, currently on the parcel of a substance not presently classified as hazardous but that may in the future be so classified.

Further, such liabilities may arise not simply from the existence of a hazardous substance but from the method of handling it. All of these possibilities could significantly affect the value of Taxable Property that is realizable upon a delinquency.

Endangered and Threatened Species. It is illegal to harm or disturb any plants or animals in their habitat that have been listed as endangered species by the United States Fish & Wildlife Service under the Federal Endangered Species Act or by the California Fish & Game Commission under the California Endangered Species Act without a permit. Although Lennar Homes believes that no federally listed endangered or threatened species would be affected by the proposed development within Improvement Area No. 2, other than any that are permitted by the entitlements already received (which allow for the impact of development and specify the mitigation required), the discovery of an endangered plant or animal could delay development of vacant property in Improvement Area No. 2 or reduce the value of undeveloped property.

Future Property Development

Continuing development of the parcels in Improvement Area No. 2 may be adversely affected by changes in general or local economic conditions, fluctuations in or a deterioration of the real estate market, increased construction costs, development, financing and marketing capabilities of the developer, water or electricity shortages, discovery on the undeveloped property of any plants or animals in their habitat that have been listed as endangered species, changes in law, and other similar factors. Development in Improvement Area No. 2 may also be ITEM 19.3.

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affected by development in surrounding areas, which may compete with the property in Improvement Area No. 2.

For example, H.R. 1 of the 115th U.S. Congress, known as the “Tax Cuts and Jobs Act,” was enacted into law on December 22, 2017 (the “Tax Act” ). The Tax Act made significant changes to many aspects of the Code that could have an impact on future property development, although to-date none have been widespread.

Other Possible Claims Upon the Value of Taxable Property

While the Special Taxes are secured by the Taxable Property, the security only extends to the value of such Taxable Property that is not subject to priority and parity liens and similar claims.

The table in the section entitled “VALUE OF PROPERTY WITHIN IMPROVEMENT AREA NO. 2 – Priority of Lien ” shows the presently outstanding amount of governmental obligations (with stated exclusions), the tax or assessment for which is or may become an obligation of one or more of the parcels in Improvement Area No. 2 subject to a Special Tax .

The table also states the additional amount of general obligation bonds the tax for which, if and when issued, may become an obligation of one or more of the parcels in Improvement Area No. 2 subject to a Special Tax. The table does not specifically identify which of the governmental obligations are secured by liens on one or more of the parcels in Improvement Area No. 2 subject to a Special Tax.

In addition, other governmental obligations may be authorized and undertaken or issued in the future, the tax, assessment or charge for which may become an obligation of one or more of the parcels in Improvement Area No. 2 subject to a Special Tax and may be secured by a lien on a parity with the lien of the Special Tax securing the Bonds.

In general, as long as the Special Tax is collected on the County tax roll, the Special Tax and all other taxes, assessments and charges also collected on the tax roll are on a parity and have equal priority. Questions of priority become significant when collection of one or more of the taxes, assessments or charges is sought by some other procedure, such as foreclosure and sale. In the event of proceedings to foreclose for delinquency of Special Taxes securing the Bonds, the Special Tax will be subordinate only to existing prior governmental liens, if any.

Otherwise, in the event of such foreclosure proceedings, the Special Taxes will generally be on a parity with the other taxes, assessments and charges, and will share the proceeds of such foreclosure proceedings on a pro rata basis. Although the Special Taxes will generally have priority over non-governmental liens on a parcel of Taxable Property, regardless of whether the non-governmental liens were in existence at the time of the levy of the Special Tax or not, this result may not apply in the case of bankruptcy. See “– Bankruptcy Delays” below.

Exempt Properties

Certain properties are exempt from the Special Tax in accordance with the Special Tax Formula and the Mello-Roos Act, which provides that properties or entities of the state, federal or local government are exempt from the Special Tax; provided, however, that property within Improvement Area No. 2 acquired by a public entity through a negotiated transaction or by gift or devise, which is not otherwise exempt from the Special Tax, will continue to be subject to the Special Tax. See “SECURITY FOR THE BONDS – Special Tax Formula.”

ITEM 19.3.

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In addition, although the Mello-Roos Act provides that if property subject to the Special Tax is acquired by a public entity through eminent domain proceedings, the obligation to pay the Special Tax with respect to that property is to be treated as if it were a special assessment, the constitutionality and operation of these provisions of the Mello-Roos Act have not been tested, meaning that such property could become exempt from the Special Tax. The Mello -Roos Act further provides that no other properties or entities are exempt from the Special Tax unless the properties or entities are expressly exempted in a resolution of consideration to levy a new special tax or to alter the rate or method of apportionment of an existing special tax.

FDIC/Federal Government Interests in Properties

General. The ability of the City to foreclose the lien of delinquent unpaid Special Tax installments may be limited with regard to properties in which the FDIC, the Drug Enforcement Agency, the Internal Revenue Service, or other federal agency has or obtains an interest.

Federal courts have held that, based on the supremacy clause of the United States Constitution, in the absence of Congressional intent to the contrary, a state or local agency cannot foreclose to collect delinquent taxes or assessments if foreclosure would impair the federal government interest.

The supremacy clause of the United States Constitution reads as follows: “This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the contrary notwithstanding.”

This means that, unless Congress has otherwise provided, if a federal governmental entity owns a parcel that is subject to Special Taxes but does not pay taxes and assessments levied on the parcel (including Special Taxes), the applicable state and local governments cannot foreclose on the parcel to collect the delinquent taxes and assessments.

Moreover, unless Congress has otherwise provided, if the federal government has a mortgage interest in the parcel and the City wishes to foreclose on the parcel as a result of delinquent Special Taxes, the property cannot be sold at a foreclosure sale unless it can be sold for an amount sufficient to pay delinquent taxes and assessments on a parity with the Special Taxes and preserve the federal government ’s mortgage interest. In Rust v. Johnson (9th Circuit; 1979) 597 F.2d 174, the United States Court of Appeal, Ninth Circuit held that the Federal National Mortgage Association (“FNMA”) is a federal instrumentality for purposes of this doctrine, and not a private entity, and that, as a result, an exercise of state power over a mortgage interest held by FNMA constitutes an exercise of state power over property of the United States.

The City has not undertaken to determine whether any federal governmental entity currently has, or is likely to acquire, any interest (including a mortgage interest) in any of the parcels subject to the Special Taxes, and therefore expresses no view concerning the likelihood that the risks described above will materialize while the Bonds are outstanding.

FDIC. In the event that any financial institution making any loan which is secured by real property within Improvement Area No. 2 is taken over by the FDIC, and prior thereto or thereafter the loan or loans go into default, resulting in ownership of the property by the FDIC, ITEM 19.3.

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then the ability of the City to collect interest and penalties specified by State law and to foreclose the lien of delinquent unpaid Special Taxes may be limited.

The FDIC’s policy statement regarding the payment of state and local real property taxes (the “Policy Statement”) provides that property owned by the FDIC is subject to state and local real property taxes only if those taxes are assessed according to the property ’s value, and that the FDIC is immune from real property taxes assessed on any basis other than property value.

According to the Policy Statement, the FDIC will pay its property tax obligations when they become due and payable and will pay claims for delinquent property taxes as promptly as is consistent with sound business practice and the orderly administration of the institution’s affairs, unless abandonment of the FDIC ’s interest in the property is appropriate. The FDIC will pay claims for interest on delinquent property taxes owed at the rate provided under state law, to the extent the interest payment obligation is secured by a valid lien. The FDIC will not pay any amounts in the nature of fines or penalties and will not pay nor recognize liens for such amounts. If any property taxes (including interest) on FDIC -owned property are secured by a valid lien (in effect before the property became owned by the FDIC), the FDIC will pay those claims. The Policy Statement further provides that no property of the FDIC is subject to levy, attachment, garnishment, foreclosure or sale without the FDIC ’s consent. In addition, the FDIC will not permit a lien or security interest held by the FDIC to be eliminated by foreclosure without the FDIC’s consent.

The Policy Statement states that the FDIC generally will not pay non -ad valorem taxes, including special assessments, on property in which it has a fee interest unless the amount of tax is fixed at the time that the FDIC acquires its fee interest in the property, nor will it recognize the validity of any lien to the extent it purports to secure the payment of any such amounts.

Special taxes imposed under the Mello -Roos Act and a special tax formula which determines the special tax due each year are specifically identified in the Policy Statement as being imposed each year and therefore covered by the FDIC ’s federal immunity. The Ninth Circuit issued a ruling on August 28, 2001, in which it determined that the FDIC, as a federal agency, is exempt from special taxes levied under the Act.

The City is unable to predict what effect the application of the Policy Statement would have in the event of a delinquency in the payment of Special Taxes on a parcel within Improvement Area No. 2 in which the FDIC has or obtains an interest, although prohibiting the lien of the Special Taxes to be foreclosed out at a judicial foreclosure sale could reduce or eliminate the number of persons willing to purchase a parcel at a foreclosure sale. Such an outcome could cause a draw on the Reserve Fund and perhaps, ultimately, if enough property were to become owned by the FDIC, a default in payment on the Bonds.

Depletion of the Reserve Fund

The Reserve Fund is to be maintained at an amount equal to the Reserve Requirement as defined in the Fiscal Agent Agreement . See “SECURITY FOR THE BONDS – Reserve Fund.” T he Reserve Fund will be used to pay principal of and interest on the Bonds if insufficient funds are available from the proceeds of the levy and collection of the Special Tax against property within Improvement Area No. 2. If the Reserve Fund is depleted, it can be replenished from the proceeds of the levy and collection of the Special Taxes that exceed the amounts to be paid to the owners of the Bonds under the Fiscal Agent Agreement. However, because the Special Tax levy is limited to the annual Maximum Annual Special Tax rates, it is possible that no replenishment would be achieved if the Special Tax proceeds, together with other available funds, remain insufficient to pay all such amounts. Thus , it is possible that the ITEM 19.3.

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Reserve Fund will be depleted and not be replenished by the levy and collection of the Special Taxes.

Bankruptcy Delays

The payment of the Special Tax and the ability of the City to foreclose the lien of a delinquent unpaid Special Tax, as discussed in “SECURITY FOR THE BONDS,” may be limited by bankruptcy, insolvency or other laws generally affecting creditors’ rights or by the laws of the State of California relating to judicial foreclosure. The various legal opinions to be delivered concurrently with the delivery of the Bonds (including Bond Counsel’s approving legal opinion) will be qualified as to the enforceability of the various legal instruments by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors ’ rights, by the application of equitable principles and by the exercise of judicial discretion in appropriate cases.

Although bankruptcy proceedings would not cause the Special Taxes to become extinguished, bankruptcy of a property owner or any other person claiming an interest in the property could result in a delay in superior court foreclosure proceedings and could result in the possibility of Special Tax installments not being paid in part or in full. Such a delay would increase the likelihood of a delay or default in payment of the principal of and interest on the Bonds.

In addition, the amount of any lien on property securing the payment of delinquent Special Taxes could be reduced if the value of the property were determined by the bankruptcy court to have become less than the amount of the lien, and the amount of the delinquent Special Taxes in excess of the reduced lien could then be treated as an unsecured claim by the court.

Any such stay of the enforcement of the lien for the Special Tax, or any such delay or non - payment, would increase the likelihood of a delay or default in payment of the principal of and interest on the Bonds and the possibility of delinquent Special Taxes not being paid in full.

To the extent that property in Improvement Area No. 2 continues to be owned by a limited number of property owners, the chances are increased that the Reserve Fund could be fully depleted during any such delay in obtaining payment of delinquent Special Taxes. As a result, sufficient moneys would not be available in the Reserve Fund to make up shortfalls resulting from delinquent payments of the Special Tax and thereby to pay principal of and interest on the Bonds on a timely basis.

On July 30, 1992, the United States Court of Appeals for the Ninth Circuit issued its opinion in a bankruptcy case entitled In re Glasply Marine Industries. In that case, the court held that ad valorem property taxes levied by Snohomish County in the State of Washington after the date that the property owner filed a petition for bankruptcy were not entitled to priority over a secured creditor with a prior lien on that property. The court upheld the priority of unpaid ad valorem taxes imposed before the bankruptcy petition (the “pre-petition taxes ”), but unpaid taxes imposed after the filing of the bankruptcy petition ( “post-petition taxes”) were declared to be unsecured “administrative expenses” of the bankruptcy estate, and were therefore held to be payable from the bankruptcy estate only after payment of all secured creditors. As a result, the secured creditor of the property was able to foreclose on the property and retain all of the proceeds of the sale except for the amount of the pre-petition taxes.

According to the court ’s ruling, as administrative expenses, post -petition taxes would have to be paid, but only if the debtor had sufficient assets not subject to other perfected security interests to do so. In certain circumstances, payment of such administrative expenses ITEM 19.3.

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may also be allowed to be deferred. Once the property is transferred out of the bankruptcy estate (through foreclosure or otherwise) it would at that time again become subject to and would secure liens for then current and future ad valorem taxes.

Glasply was controlling precedent on bankruptcy courts in the State of California for several years subsequent to the date of the Ninth Circuit’s holding. Pursuant to state law, the lien date for general ad valorem property taxes levied in the State of California is the January 1 preceding the fiscal year for which the taxes are levied. Under the Glasply holding, a bankruptcy petition filing would have prevented the lien for general ad valorem property taxes levied in fiscal years subsequent to the filing of a bankruptcy petition from attaching and becoming a lien so long as the property was a part of the estate in bankruptcy. However, the Glasply holding was for the most part subsequently rendered inoperative with respect to the imposition of a lien for and the collection of ad valorem taxes by amendments to the federal Bankruptcy Code (Title 11 U.S.C.) which were part of the Bankruptcy Reform Act of 1994 (the “Bankruptcy Reform Act ”) passed by Congress during the later part of 1994. The Bankruptcy Reform Act added a provision to the automatic stay section of the Bankruptcy Code which, pursuant to Section 362(b)(18) thereof, excepts from the Bankruptcy Code’s automatic stay provisions, “the creation of a statutory lien for an ad valorem property tax imposed by . . . a political subdivision of a state, if such tax comes due after the filing of the petition ” by a debtor in bankruptcy court. The effect of this provision is to continue the secured interest of ad valorem taxes on real property (i.e., post-petition taxes) in effect during the period following the filing of a bankruptcy petition, including during the period bankruptcy proceedings are pending.

Without further clarification by the courts or Congress, the original rationale of the Glasply holding could, however, still result in the treatment of post -petition special taxes as “administrative expenses,” rather than as tax liens secured by real property, at least during the pendency of bankruptcy proceedings. This treatment might result from the fact that, although the lien of special taxes is of record from the date of the filing of a Notice of Special Tax Lien, the actual special tax is levied annually. As noted above, special taxes have a different lien date than the lien date for general ad valorem taxes in the State of California noted above. The lien of a Mello -Roos special tax attaches upon recordation of the notice of the special tax lien, as provided for in Section 53328.3 of the Act, as opposed to the annual January 1 lien date for general ad valorem taxes. Thus, in deciding whether the original Glasply ruling is applicable to a bankruptcy proceeding involving special taxes rather than general ad valorem property taxes, a court might consider the differences in the statutory provisions for creation of the applicable tax lien (general ad valorem or special tax) in determining whether there is a basis for post petition special taxes to be entitled to a lien on the property during pending bankruptcy proceedings. If a court were to apply Glasply to eliminate the priority of the special tax lien as a secured claim against property with respect to post- petition levies of the Special Taxes made against property owners within Improvement Area No. 2 who file for bankruptcy, collections of the Special Taxes from such property owners could be reduced as the result of being treated as “administrative expenses” of the bankruptcy estate. Also, and most importantly, is the fact that the original holding in Glasply and the mitigation of that holding by the Bankruptcy Reform Act of 1994 both appear to be applicable only to general ad valorem taxes, and, therefore, the exemption from the automatic stay in Section 362(b)(18) discussed above may not be applicable to special taxes since they were not expressly mentioned or provided for in this section, nor defined to be included within the term “ad valorem taxes.”

ITEM 19.3.

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Disclosure to Future Purchasers

The City has recorded a notice of the Special Tax lien in the Office of the County Recorder. While title companies normally refer to such notices in title reports, there can be no guarantee that such reference will be made or, if made, that a prospective purchaser or lender will consider such special tax obligation in the purchase of a parcel of land or a home in Improvement Area No. 2 or the lending of money secured by property in Improvement Area No.

2. The Mello-Roos Act and the City’s Mello- Roos Act Goals and Policies require the subdivider of a subdivision (or its agent or representative) to notify a prospective purchaser or long -term lessor of any lot, parcel, or unit subject to a Mello -Roos special tax of the existence and maximum amount of such special tax using a statutorily prescribed form. California Civil Code Section 1102.6b requires that in the case of transfers other than those covered by the above requirement, the seller must at least make a good faith effort to notify the prospective purchaser of the special tax lien in a format prescribed by statute. Failure by an owner of the property to comply with these requirements, or failure by a purchaser or lessor to consider or understand the nature and existence of the Special Tax, could adversely affect the willingness and ability of the purchaser or lessor to pay the Special Tax when due.

No Acceleration Provisions

The Bonds do not contain a provision allowing for their acceleration in the event of a payment default or other default under the terms of the Bonds or the Fiscal Agent Agreement.

Under the Fiscal Agent Agreement, a Bondowner is given the right for the equal benefit and protection of all Bondowners similarly situated to pursue certain remedies. So long as the Bonds are in book-entry form, DTC will be the sole Bondowner and will be entitled to exercise all rights and remedies of Bondholders, in accordance with its procedures and rules.

Loss of Tax Exemption

As discussed under the caption “TAX MATTERS,” interest on the Bonds might become includable in gross income for purposes of federal income taxation retroactive to the date the Bonds were issued as a result of future acts or omissions of the City in violation of its covenants in the Fiscal Agent Agreement. The Fiscal Agent Agreement does not contain a special redemption feature triggered by the occurrence of an event of taxability. As a result, if interest on the Bonds were to become includable in gross income for purposes of federal income taxation, the Bonds would continue to remain outstanding until maturity unless earlier redeemed pursuant to optional redemption, mandatory sinking fund redemption or special mandatory redemption upon prepayment of the Special Taxes. See “THE BONDS – Redemption.”

Future legislative proposals, if enacted into law, clarification of the Code or court decisions may cause interest on the Bonds to be subject, directly or indirectly, to federal income taxation or to be subject to or exempted from state income taxation, or otherwise prevent Bondowners from realizing the full current benefit of the tax status of such interest.

IRS Audit of Tax-Exempt Bond Issues

The Internal Revenue Service (the “IRS”) has initiated an expanded program for the auditing of tax- exempt bond issues, including both random and targeted audits. It is possible that the Bonds will be selected for audit by the IRS. It is also possible that the market value of such Bonds might be affected as a result of such an audit (or by an audit of similar bonds or securities).

ITEM 19.3.

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Voter Initiatives

Under the California Constitution, the power of initiative is reserved to the voters for the purpose of enacting statutes and constitutional amendments. Since 1978, the voters have exercised this power through the adoption of Proposition 13 and similar measures, including Proposition 218, which was approved in the general election held on November 5, 1996, and Proposition 26, which was approved on November 2, 2010.

Any such initiative may affect the collection of fees, taxes and other types of revenue by local agencies such as the City. Subject to overriding federal constitutional principles, such collection may be materially and adversely affected by voter-approved initiatives, possibly to the extent of creating cash- flow problems in the payment of outstanding obligations such as the Bonds.

Proposition 218 – Voter Approval for Local Government Taxes —Limitation on Fees, Assessments, and Charges —Initiative Constitutional Amendment, added Articles XIIIC and XIIID to the California Constitution, imposing certain vote requirements and other limitations on the imposition of new or increased taxes, assessments and property-related fees and charges.

On November 2, 2010, California voters approved Proposition 26, entitled the “Supermajority Vote to Pass New Taxes and Fees Act. ” Section 1 of Proposition 26 declares that Proposition 26 is intended to limit the ability of the State Legislature and local government to circumvent existing restrictions on increasing taxes by defining the new or expanded taxes as “fees.” Proposition 26 amended Articles XIIIA and XIIIC of the State Constitution. The amendments to Article XIIIA limit the ability of the State Legislature to impose higher taxes (as defined in Proposition 26) without a two-thirds vote of the Legislature. Article XIIIC requires that all new local taxes be submitted to the electorate before they become effective. Special Taxes for general governmental purposes require a majority vote and taxes for specific purposes (“special taxes”) require a two-thirds vote.

The City believes that issuance of the Bonds and levying of the Special Taxes does not require the conduct of further proceedings under the Mello -Roos Act, Proposition 218, or Proposition 26 , however no assurance can be given that future initiatives or judicial interpretations thereof will not affect the levy of the Special Taxes.

Case Law Related to the Mello-Roos Act Voting

On August 1, 2014, the California Court of Appeal, Fourth Appellate District, issued its opinion in City of San Diego v. Melvin Shapiro, et al. (D063997). The case involved a Convention Center Facilities District (the “CCFD”) established by the City of San Diego. The CCFD is a financing district established under the City ’s charter (the “Charter”) and was intended to function much like a community facilities district established under the Mello -Roos Act. The CCFD was comprised of all of the real property in the entire City. However, the CCFD special tax was to be levied only on properties in the CCFD that were improved with a hotel.

At the election to authorize the CCFD special tax, the CCFD proceedings limited the electorate to owners of hotel properties and lessees of real property owned by a governmental entity on which a hotel was located. Registered voters in the City of San Diego were not permitted to vote. This definition of the qualified electors of the CCFD was based on Section 53326(c) of the Mello- Roos Act, which generally provides that, if a special tax will not be ITEM 19.3.

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apportioned in any tax year on residential property, the legislative body may provide that the vote shall be by the landowners of the proposed community facilities district whose property would be subject to the special tax.

The San Diego Court held that the CCFD special tax election did not comply with the City’s Charter and with applicable provisions of the California Constitution -- specifically Article XIIIA, section 4 ( “Cities, Counties and special districts, by a two -thirds vote of the qualified electors of such district, may impose special taxes on such district….”) and Article XIIIC, section 2(d) (“No local government may impose, extend, or increase any special tax unless and until that tax is submitted to the electorate and approved by a two -thirds vote. ”) -- because the electors in the CCFD election should have been the registered voters residing within the CCFD (the boundaries of which were coterminous with the boundaries of the City of San Diego).

As to Improvement Area No. 2, there were fewer than 12 registered voters within Improvement Area No. 2 at the time of the election to authorize the Special Taxes. Significantly, the San Diego Court expressly stated that it was not addressing the validity of a landowner election to impose special taxes on residential property pursuant to the Mello -Roos Act in situations where there are fewer than 12 registered voters. Therefore, by its terms, the San Diego Court’s holding does not apply to the special tax election in Improvement Area No. 2.

Moreover, Sections 53341 and 53359 of the Act establish a limited period of time in which special taxes levied under the Mello-Roos Act may be challenged by a third party:

53341. Any action or proceeding to attack, review, set aside, void, or annul the levy of a special tax or an increase in a special tax pursuant to [the Mello -Roos Act] shall be commenced within 30 days after the special tax is approved by the voters….

53359. An action to determine the validity of bonds issued pursuant to [the Mello-Roos Act] or the validity of any special taxes levied pursuant to [the Mello - Roos Act] … shall …. be commenced within 30 days after the voters approve the issuance of the bonds or the special tax …

Section 53326(b) of the Mello -Roos Act defines the authorized voters for an election in which the special taxes will be levied on residential property: “Except as otherwise provided in subdivision (c), if at least 12 persons, who need not necessarily be the same 12 persons, have been registered to vote within the territory of the proposed community facilities district for each of the 90 days preceding the close of the protest hearing, the vote shall be by the registered voters of the proposed district, with each voter having one vote. Otherwise, the vote shall be by the landowners of the proposed district and each person who is the owner of land at the close of the protest hearing, or the authorized representative thereof, shall have one vote for each acre or portion of an acre of land that he or she owns within the proposed community facilities district not exempt from the special tax….”

Landowner voters approved the Special Taxes and the issuance of bonds for Improvement Area No. 2 in compliance with all applicable requirements of the Mello -Roos Act and, pursuant to Sections 53341 and 53359 of the Mello -Roos Act, the statute of limitations period to challenge the validity of the special tax has expired. Because the San Diego Court expressly stated that it did not consider the facts presented by Improvement Area No. 2 and the District, and because the period for challenging the Special Taxes has passed, the City believes the Special Taxes are valid and cannot be challenged.

ITEM 19.3.

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Secondary Market for Bonds

There can be no guarantee that there will be a secondary market for the Bonds or, if a secondary market exists, that any Bonds can be sold for any particular price. Prices of bond issues for which a market is being made will depend upon then -prevailing circumstances. Such prices could be substantially different from the original purchase price.

No assurance can be given that the market price for the Bonds will not be affected by the introduction or enactment of any future legislation (including without limitation amendments to the Internal Revenue Code), or changes in interpretation of the Internal Revenue Code, or any action of the IRS, including but not limited to the publication of proposed or final regulations, the issuance of rulings, the selection of the Bonds for audit examination, or the course or result of any IRS audit or examination of the Bonds or obligations that present similar tax issues as the Bonds.

Pandemic Diseases

In recent years, public health authorities have warned of threats posed by outbreaks of disease and other public health threats. Pandemic diseases arising in the future could have significant adverse health and financial impacts throughout the world, leading to loss of jobs and personal financial hardships, and/or actions by federal, State and local governmental authorities to contain or mitigate the effects of an outbreak.

Taxpayer assistance measures may include deferral of due dates of property taxes, which was an assistance program during the COVID -19 pandemic, and with or without a deferral some taxpayers may be unable to make their property and Special Tax payments. No assurance can be given that the property tax payment dates will not be deferred in the future, which may cause a delay in the receipt of Special Taxes. In addition, home values may be affected by a reduction in demand stemming from personal finances, or general widespread economic circumstances resulting from pandemic diseases.

Cyber Security

The City, like many other public and private entities, relies on computer and other digital networks and systems to conduct its operations. As a recipient and provider of personal, private or other sensitive electronic information, the City is potentially subject to multiple cyber threats, including without limitation hacking, viruses, ransomware, malware and other attacks. No assurance can be given that the City ’s efforts to manage cyber threats and attacks will be successful in all cases, or that any such attack will not materially impact the operations or finances of the City or Improvement Area No. 2, or the administration of the Bonds. The City is also reliant on other entities and service providers in connection with the administration of the Bonds, including without limitation the County tax collector for the levy and collection of Special Taxes, the Fiscal Agent, and the dissemination agent. No assurance can be given that the City, Improvement Area No. 2 and these other entities will not be affected by cyber threats and attacks in a manner that may affect the Bond owners.

Potential Early Redemption of Bonds from Prepayments

Property owners within Improvement Area No. 2, including Lennar Homes and individual homeowners, are permitted to prepay their Special Tax obligation at any time. Such ITEM 19.3.

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prepayments could also be made from the proceeds of bonds issued by or on behalf of an overlapping special assessment district or community facilities district. Such prepayments will result in a redemption of the Bonds on the interest payment date for which timely notice may be given under the Fiscal Agent Agreement following the receipt of the prepayment. The resulting redemption of Bonds that were purchased at a price greater than par could reduce the otherwise expected yield on such Bonds.

LEGAL MATTERS

Legal Opinion

The legal opinion of Jones Hall, A Professional Law Corporation, San Francisco, California, Bond Counsel, approving the validity of the Bonds will be made available to purchasers at the time of original delivery and is attached in substantially final form as APPENDIX E.

Jones Hall, A Professional Law Corporation, San Francisco, California, has served as Disclosure Counsel to the City. Meyers Nave, A Professional Law Corporation, Sacramento, California, will pass upon certain legal matters for the City as its City Attorney. Kutak Rock LLP, Irvine, California, is serving as counsel to the Underwriter.

No Litigation

At the time of delivery of the Bonds , the City will certify that there is no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, public board or body, pending with respect to which the City has been served with process or threatened, which (i) in any way questions the powers of the City Council or the City, (ii) in any way questions the validity of any proceeding taken by the City Council in connection with the issuance of the Bonds, (iii) wherein an unfavorable decision, ruling or finding could have a material adverse effect on the transactions contemplated by the purchase contract with respect to the Bonds, (iv) which, in any way, could adversely affect the validity or enforceability of the resolutions of the City Council adopted in connection with the formation of the District or Improvement Area No. 2, or the issuance of the Bonds, the Fiscal Agent Agreement, the Continuing Disclosure Agreement or the purchase contract with respect to the Bonds , (v) to the knowledge of the City, which in any way questions the exclusion from gross income of the recipients thereof of the interest on the Bonds for federal income tax purposes, or (vi) in any other way questions the status of the Bonds under State tax laws or regulations.

TAX MATTERS

Federal Tax Status. In the opinion of Jones Hall, A Professional Law Corporation, San Francisco, California, Bond Counsel, subject, however to the qualifications set forth below, under existing law, the interest on the Bonds is excluded from gross income for federal income tax purposes and such interest is not an item of tax preference for purposes of the federal alternative minimum tax. Interest on the Bonds may be subject to the corporate alternative minimum tax.

The opinions set forth in the preceding paragraph are subject to the condition that the City comply with all requirements of the Internal Revenue Code of 1986, as amended (the “Tax ITEM 19.3.

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Code”) that must be satisfied subsequent to the issuance of the Bonds in order that the interest thereon be, and continue to be, excludable from gross income for federal income tax purposes.

The City has made certain representations and covenants in order to comply with each such requirement. Inaccuracy of those representations, or failure to comply with certain of those covenants, may cause the inclusion of such interest in gross income for federal income tax purposes, which may be retroactive to the date of issuance of the Bonds.

Tax Treatment of Original Issue Discount and Premium. If the initial offering price to the public at which a Bond is sold is less than the amount payable at maturity thereof, then such difference constitutes “original issue discount” for purposes of federal income taxes and State of California personal income taxes. If the initial offering price to the public at which a Bond is sold is greater than the amount payable at maturity thereof, then such difference constitutes “original issue premium” for purposes of federal income taxes and State of California personal income taxes. De minimis original issue discount and original issue premium are disregarded.

Under the Tax Code, original issue discount is treated as interest excluded from federal gross income and exempt from State of California personal income taxes to the extent properly allocable to each owner thereof subject to the limitations described in the first paragraph of this section. The original issue discount accrues over the term to maturity of the Bond on the basis of a constant interest rate compounded on each interest or principal payment date (with straight- line interpolations between compounding dates). The amount of original issue discount accruing during each period is added to the adjusted basis of such Bonds to determine taxable gain upon disposition (including sale, redemption, or payment on maturity) of such Bond. The Tax Code contains certain provisions relating to the accrual of original issue discount in the case of purchasers of the Bonds who purchase the Bonds after the initial offering of a substantial amount of such maturity. Owners of such Bonds should consult their own tax advisors with respect to the tax consequences of ownership of Bonds with original issue discount, including the treatment of purchasers who do not purchase in the original offering to the public at the first price at which a substantial amount of such Bonds is sold to the public.

Under the Tax Code, original issue premium is amortized on an annual basis over the term of the Bond (said term being the shorter of the Bond’s maturity date or its call date). The amount of original issue premium amortized each year reduces the adjusted basis of the owner of the Bond for purposes of determining taxable gain or loss upon disposition. The amount of original issue premium on a Bond is amortized each year over the term to maturity of the Bond on the basis of a constant interest rate compounded on each interest or principal payment date (with straight-line interpolations between compounding dates). Amortized bond premium is not deductible for federal income tax purposes. Owners of premium Bonds, including purchasers who do not purchase in the original offering, should consult their own tax advisors with respect to State of California personal income tax and federal income tax consequences of owning such Bonds.

California Tax Status. In the further opinion of Bond Counsel, interest on the Bonds is exempt from California personal income taxes.

Other Tax Considerations. Current and future legislative proposals, if enacted into law, clarification of the Tax Code or court decisions may cause interest on the Bonds to be subject, directly or indirectly, to federal income taxation or to be subject to or exempted from state income taxation, or otherwise prevent beneficial owners from realizing the full current benefit of the tax status of such interest. The introduction or enactment of any such legislative proposals, clarification of the Tax Code or court decisions may also affect the market price for, ITEM 19.3.

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or marketability of, the Bonds. It cannot be predicted whether or in what form any such proposal might be enacted or whether, if enacted, such legislation would apply to bonds issued prior to enactment.

The opinions expressed by Bond Counsel are based upon existing legislation and regulations as interpreted by relevant judicial and regulatory authorities as of the date of such opinion, and Bond Counsel has expressed no opinion with respect to any proposed legislation or as to the tax treatment of interest on the Bonds, or as to the consequences of owning or receiving interest on the Bonds, as of any future date. Prospective purchasers of the Bonds should consult their own tax advisors regarding any pending or proposed federal or state tax legislation, regulations or litigation, as to which Bond Counsel expresses no opinion.

Owners of the Bonds should also be aware that the ownership or disposition of, or the accrual or receipt of interest on, the Bonds may have federal or state tax consequences other than as described above. Other than as expressly described above, Bond Counsel expresses no opinion regarding other federal or state tax consequences arising with respect to the Bonds, the ownership, sale or disposition of the Bonds, or the amount, accrual or receipt of interest on the Bonds.

CONTINUING DISCLOSURE

The City

The City has covenanted for the benefit of owners of the Bonds to provide certain financial information and operating data relating to Improvement Area No. 2 by not later than nine months after the end of the City’s fiscal year (presently June 30) in each year (the “City Annual Report”) commencing with its report for Fiscal Year 2023-24 (due by April 1, 2025) and to provide notices of the occurrence of certain enumerated events; provided, the first City Annual Report may be satisfied solely with the City’s audited financial statements for such period.

The City Annual Report and notices of listed events will be filed with the Municipal Securities Rulemaking Board. The covenants of the City have been made in order to assist the Underwriter in complying with Securities Exchange Commission Rule 15c2 -12(b)(5) (the “Rule”). The specific nature of the information to be contained in the Annual Report or the notices of listed events by the City is summarized in “APPENDIX F – Form of Continuing Disclosure Undertakings.”

A review of the City’s compliance with prior continuing disclosure undertakings in the last five years indicates that the City has been in compliance during such period. The City retain s Goodwin Consulting Group, Inc. to serve as dissemination agent with respect to the filings to be made with respect to the Bonds and its other undertakings under the Rule.

Lennar Homes

Additionally, Lennar Homes has covenanted for the benefit of owners of the Bonds to provide certain information by April 1 and October 1 of any fiscal year (commencing April 1, 2025) with respect to the property owned by it and its Affiliates (as defined in the Continuing Disclosure Certificate) within Improvement Area No. 2 (the “Developer Semi-Annual Report”) to owners of the Bonds until such time as property owned by Lennar Homes and the Land Bank ITEM 19.3.

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Owner (during the term of the Option Agreement ) is no longer responsible for payment of 20% or more of the Special Taxes levied in Improvement Area No. 2, as described in the Developer Semi-Annual Report, and to provide notices of the occurrence of certain enumerated events.

The specific nature of the information to be contained in the Developer Semi -Annual Report or the notices of listed events by Lennar Homes is summarized in “APPENDIX F – Form of Continuing Disclosure Undertakings.”

Lennar Homes represents that, other than as disclosed in this paragraph, to the actual knowledge of Lennar Homes, Lennar Homes has not failed in any material respect to comply with any previous undertaking by it to provide periodic continuing disclosure reports or notices of material events with respect to community facilities districts or assessment districts in California within the past five years. However, (i) in connection with the $16,780,000 California Municipal Finance Authority Special Tax Revenue Bonds BOLD Program Series 2020B, Lennar Homes inadvertently failed to file the initial Semi- Annual Report by the due date of May 1, 2021, but filed a curative report on May 21, 2021; and (ii) in connection with the $5,795,000 City of Rancho Cordova Grantline 208 Community Facilities District No. 2018 -1 Special Tax Bonds, Series 2021B, Lennar Homes inadvertently failed to file the initial annual report by the due date of April 1, 2022, but filed a curative report on September 21, 2022.

NO RATING

The City has not obtained a formal credit rating on the Bonds and does not anticipate obtaining one on the Bonds in the future. Prospective purchasers of the Bonds are required to make independent determinations as to the credit quality of the Bonds and their appropriateness as an investment.

UNDERWRITING

The Bonds are being purchased by Piper Sandler & Co. , as underwriter (the “Underwriter”), at a purchase price of $____________ (which represents the aggregate principal amount of the Bonds ($____________), [plus/minus][net] original issue [premium/discount] of $____________, and less an Underwriter’s discount of $____________).

The purchase agreement relating to the Bonds provides that the Underwriter will purchase all of the Bonds, if any are purchased, the obligation to make such purchase being subject to certain terms and conditions set forth in such purchase agreement.

The Underwriter may offer and sell the Bonds to certain dealers and others at prices lower than the off ering prices stated on the inside cover page hereof. The offering prices may be changed from time to time by the Underwriter.

CONTINGENT FEES

In connection with the issuance of the Bonds, some or all of the fees or other compensation payable to the City and certain professionals involved with the offering of the Bonds is contingent upon the issuance and delivery of the Bonds. Those entities include:

• The City, as the issuer;
ITEM 19.3.

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• Piper Sandler & Co., as the Underwriter;
• Jones Hall, A Professional Law Corporation, as Bond Counsel and Disclosure Counsel;
• Kutak Rock LLP, as Underwriter’s Counsel;
• Goodwin Consulting Group, Inc., as Special Tax Consultant; • NHA Advisors, LLC, as Municipal Advisor; and
• U.S. Bank Trust Company, National Association, as Fiscal Agent.

EXECUTION

The execution and delivery of the Official Statement by the City has been duly authorized by the City Council, acting as the legislative body of the District and Improvement Area No. 2.

CITY OF RANCHO CORDOVA

By:

Administrative Services Director

ITEM 19.3.

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APPENDIX A

RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX

ITEM 19.3.

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APPENDIX B

THE APPRAISAL

ITEM 19.3.

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APPENDIX C

SUMMARY OF CERTAIN PROVISIONS OF THE FISCAL AGENT AGREEMENT

ITEM 19.3.

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APPENDIX D

SACRAMENTO COUNTY AND CITY OF RANCHO CORDOVA

DEMOGRAPHIC INFORMATION

The following information concerning the City of Rancho Cordova (the “City”) and the County of Sacramento (the “County”) is included only for the purpose of supplying general information regarding the area of the City and County. The Bonds are not a debt of the City, the County, the State of California (the “State”) or any of its political subdivisions, and neither the City, the County, the State nor any of its political subdivisions is liable therefor.

General

The City. The City was incorporated on July 1, 2003, is located in the northeastern portion of the County, 10 miles east of downtown Sacramento and 90 miles northeast of San Francisco. Organized as a General Law City under State law, the City operates under the Council-Manager form of government with five members elected to the Council, one of which serves as mayor for a year.

The County. The County was incorporated in 1850 as one of the original 27 counties of the State. The County ’s largest city, the City of Sacramento serves as the seat of government for both the County and the State. Sacramento became the State Capital in 1854. The County is the major component of the Sacramento Metropolitan Statistical Area ( “SMSA”), which includes Sacramento, El Dorado, and Placer Counties.

The County encompasses approximately 994 square miles in the northern portion of the Central Valley, which is California’s prime agricultural region. The County is bordered by Contra Costa and San Joaquin Counties on the south, Amador and El Dorado Counties on the east, Placer and Sutter Counties on the north, and Yolo and Solano Counties on the west. The County extends from the low delta lands between the Sacramento and San Joaquin rivers north to about ten miles beyond the State Capitol and east to the foothills of the Sierra Nevada Mountains. The southernmost portion of the County has direct access to San Francisco Bay.

Population

The following table lists population estimates for the City, the County and the State for the last five calendar years, as of January 1, 2024.

CITY OF RANCHO CORDOVA, COUNTY OF SACRAMENTO

AND STATE OF CALIFORNIA
Population Estimates
Calendar Years 2020 through 2024, as of January 1

Calendar Year
City of
Rancho Cordova
County of
Sacramento
State of
California
2020 78,872 1,580,826 39,535,623
2021 79,669 1,580,120 39,327,868
2022 80,378 1,572,254 39,114,785
2023 81,604 1,576,639 39,061,058
2024 82,109 1,578,938 39,128,162

Source: State Department of Finance.

ITEM 19.3.

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Employment and Industry

The unemployment rate in the Sacramento --Roseville--Arden-Arcade MSA was 5. 1 percent in July 2024, up from a revised 4.7 percent in June 2024, and above the year -ago estimate of 4.3 percent. This compares with an unadjusted unemployment rate of 5.8 percent for California and 4. 5 percent for the nation during the same period. The unemployment rate was 4.7 percent in El Dorado County, 4.5 percent in Placer County, 5.3 percent in Sacramento County, and 5.4 percent in Yolo County.

The table below provides information about employment rates and employment by industry type for the Sacramento MSA (which includes Sacramento, Placer, Yolo and El Dorado Counties) for the calendar years 2019 through 2023.

SACRAMENTO-ARDEN ARCADE-ROSEVILLE MSA
(El Dorado, Placer, Sacramento, Yolo Counties)
Employment by Industry
(March 2023 Benchmark)

2019 2020 2021 2022 2023
Civilian Labor Force (1) 1,099,300 1,093,500 1,105,400 1,112,100 1,129,200 Employment 1,059,200 996,600 1,034,400 1,069,700 1,080,500 Unemployment 40,100 96,900 71,000 42,400 48,600
Unemployment Rate 3.7% 8.9% 6.4% 3.8% 4.3%
Wage and Salary Employment (2)
Agriculture 8,700 8,300 9,000 8,600 9,100
Mining and Logging 500 500 500 500 500
Construction 69,400 70,200 74,900 77,100 74,700
Manufacturing 36,800 36,100 37,700 40,600 40,500
Wholesale Trade 28,600 26,600 26,900 28,300 28,500
Retail Trade 100,500 95,100 100,600 100,300 99,000
Transportation, Warehousing and Utilities 32,200 34,300 37,500 40,800 41,600 Information 11,900 10,200 10,100 10,500 9,900
Finance and Insurance 35,200 34,800 34,100 33,000 30,500 Real Estate and Rental and Leasing 17,300 16,900 17,700 18,800 18,400 Professional and Business Services 137,200 132,600 137,200 139,700 134,400 Educational and Health Services 166,600 164,000 168,800 175,600 188,700 Leisure and Hospitality 109,600 83,900 93,600 108,700 112,500 Other Services 35,400 31,000 33,300 36,100 38,300
Federal Government 14,200 14,800 14,500 14,400 14,500
State Government 121,900 121,700 127,300 129,800 134,400 Local Government 105,300 98,900 98,400 102,700 107,400
Total, All Industries (3) 1,031,200 979,800 1,021,900 1,065,400 1,083,300

(1) Labor force data is by place of residence; includes self -employed individuals, unpaid family workers, household domestic workers, and workers on strike.
(2) Industry employment is by place of work; excludes self -employed individuals, unpaid family workers, household domestic workers, and workers on strike.
(3) Totals may not add due to rounding.

Source: State of California Employment Development Department.

ITEM 19.3.

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Principal Employers

The following table shows the principal employers in the City, as shown in the City ’s Comprehensive Annual Financial Report for fiscal year ending June 30, 2023.

CITY OF RANCHO CORDOVA
Principal Employers
As of June 2023

Employer
Number of
Employees
Percent of Total
Employment
VSP Global 1,600 3.32%
Franklin Templeton 1,200 2.49
Cordova Folsom Unified School District 1,017 2.11
Accentcare Home Health 727 1.51
Health Net Federal Services 700 1.45
The Permanente Medical Group 559 1.16
Kaiser Foundation Hospitals 497 1.03
Plexus Optix, Inc 428 0.89
Nidec Motor Corporation 400 0.83
Automotive Importing Manufacturing 303 0.63

Source: City of Rancho Cordova, Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 2023.

ITEM 19.3.

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Major Employers

The following table lists the major employers within the County as of September 2024, in alphabetical order.

COUNTY OF SACRAMENTO
Major Employers
As of September 2024

Employer Name Location Industry
Aerojet Rocketdyne Inc Rancho Cordova Aerospace Industries (mfrs) Agreeya Solutions Inc Folsom Information Technology Services American River College Sacramento Junior-Community College-Tech Institutes Ampac Fine Chemicals LLC Rancho Cordova Electronic Equipment & Supplies-Mfrs Apple Distribution Ctr Elk Grove Distribution Centers (whls) California State Univ Scrmnt Sacramento Schools-Universities & Colleges Academic Colliers International Ltd Sacramento Real Estate
Department-Corrections-Rehab Sacramento State Govt-Correctional Institutions Disabled American Veterans Sacramento Veterans' & Military Organizations Employment Development Dept Sacramento Outplacement Consultants Environmental Protection Agcy Sacramento State Government-Air/Water/Solid Waste Manage Intel Corp Folsom Semiconductor Devices (mfrs)
Kaiser Permanente South Sacramento Hospitals
L A Care Health Plan Sacramento Health Plans
Mercy General Hospital Sacramento Hospitals
Mercy San Juan Medical Ctr Carmichael Hospitals
Sacramento Bee Sacramento Newspapers (publishers/Mfrs)
Sacramento Municipal Utility Sacramento Utility Contractors Sacramento Municipal Utility Sacramento Electric Contractors Securitas Security Svc USA Sacramento Security Guard & Patrol Service State Compensation Ins Fund Sacramento Insurance
Summit Funding Inc Sacramento Real Estate Loans
Sutter Medical Ctr-Sacramento Sacramento Hospitals
Villara Mcclellan Building Contractors
Water Resource Dept Sacramento Government Offices-State

Source: State of California Employment Development Department, extracted from The America’ s Labor Market Information System (ALMIS) Employer Database, 2025 1st Edition.

ITEM 19.3.

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Effective Buying Income

“Effective Buying Income ” is defined as personal income less personal tax and nontax payments, a number often referred to as “disposable” or “after-tax” income. Personal income is the aggregate of wages and salaries, other labor -related income (such as employer contributions to private pension funds), proprietor ’s income, rental income (which includes imputed rental income of owner -occupants of non- farm dwellings), dividends paid by corporations, interest income from all sources, and transfer payments (such as pensions and welfare assistance). Deducted from this total are personal taxes (federal, state and local), nontax payments (fines, fees, penalties, etc.) and personal contributions to social insurance.

According to U.S. government definitions, the resultant figure is commonly known as “disposable personal income.”

The following table summarizes the total effective buying income for the City, the County, the State and the United States for the period 2020 through 2024.

CITY OF RANCHO CORDOVA, COUNTY OF SACRAMENTO, THE STATE OF CALIFORNIA

AND THE UNITED STATES
Effective Buying Income

As of January 1, 2020 through 2024

Year Area
Total Effective
Buying Income
(000s’ Omitted)
Median Household
Effective Buying
Income
2020 City of Rancho Cordova $1,882,411 $57,795
County of Sacramento 42,705,779 59,288
California 1,243,564,816 65,870
United States 9,487,165,436 55,303

2021 City of Rancho Cordova $2,040,016 $62,867
County of Sacramento 45,067,224 62,945
California 1,290,894,604 67,956
United States 9,809,944,764 56,790

2022 City of Rancho Cordova $2,246,178 $68,685
County of Sacramento 51,287,459 70,279
California 1,452,426,153 77,058
United States 11,208,582,541 64,448

2023 City of Rancho Cordova $2,533,621 $71,022
County of Sacramento 51,865,551 70,001
California 1,461,799,662 77,175
United States 11,454,846,397 65,326

2024 City of Rancho Cordova $2,710,561 $78,751
County of Sacramento 55,595,639 76,261
California 1,510,708,521 80,973
United States 11,987,185,826 67,876

Source: Claritas, LLC.

ITEM 19.3.

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Commercial Activity

A summary of historic taxable sales within the City and the County during the past five years in which data is available is shown in the following tables.

Total taxable sales during the first quarter of calendar year 2024 in the City were reported to be $ 470,554,173, a 9.12% decrease in the total taxable sales of $ 517,784,817 reported during the comparable quarter of calendar year 2023.

CITY OF RANCHO CORDOVA
Taxable Transactions
(Dollars in Thousands)

Retail and Food Services Stores Total All Outlets

Number
of Permits

Taxable
Transactions

Number
of Permits

Taxable
Transactions
2019 1,355 1,170,421 2,487 1,672,142
2020 1,512 1,089,203 2,788 1,655,571
2021 1,404 1,341,196 2,597 1,982,420
2022 1,429 1,390,475 2,682 2,171,811
2023 1,400 1,343,043 2,634 2,083,028

Source: California Department of Tax and Fee Administration

Total taxable sales during the first quarter of calendar year 2024 in the County were reported to be $ 8,140,687,169, a 2.30% decrease over the total taxable sales of $8,332,218,981 reported during the comparable quarter of calendar year 2023.

COUNTY OF SACRAMENTO
Taxable Transactions
(Dollars in Thousands)

Source: California Department of Tax and Fee Administration Retail and Food Services Stores Total All Outlets

Number
of Permits

Taxable
Transactions

Number
of Permits

Taxable
Transactions
2019 25,530 18,156,992 40,858 26,717,621
2020 28,055 18,488,106 45,361 27,173,406
2021 25,936 23,764,691 42,482 33,875,840
2022 26,589 24,679,703 44,158 36,511,260
2023 25,913 24,180,843 43,252 35,572,695
ITEM 19.3.

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Construction Activity

The following tables show a five -year summary of the valuation of building permits issued in the City and the County.

CITY OF RANCHO CORDOVA
Total Building Permit Valuations
(Dollars in Thousands)

2019 2020 2021 2022 2023
Permit Valuation
New Single-family $158,521.8 $164,435.7 $171,194.6 $186,410.7 $181,164.0 New Multi-family 0.0 0.0 0.0 18,935.0 33,000.0
Res. Alterations/Additions 3,492.2 7,657.0 6,503.1 6,202.0 21,679.0 Total Residential 162,014.0 172,092.7 177,697.7 211,547.7 235,843.0

New Commercial 2,320.7 28,635.4 2,672.0 12,093.0 4,191.0 New Industrial 366.0 0.0 0.0 2,030.0 0.0
New Other 1,336.2 2,150.6 5,970.7 11,624.9 50,216.0
Com. Alterations/Additions 24,046.0 34,812.6 67,569.2 35,436.7 36,892.0 Total Nonresidential $28,068.9 $65,598.6 $76,211.9 $61,184.6 $91,299.0

New Dwelling Units
Single Family 561 575 552 620 602
Multiple Family 0 0 0 149 331
TOTAL 561 575 552 769 932

Source: Construction Industry Research Board, Building Permit Summary.

COUNTY OF SACRAMENTO
Total Building Permit Valuations
(Dollars in Thousands)

2019 2020 2021 2022 2023
Permit Valuation
New Single-family $1,108,399.9 $1,008,391.7 $1,310,379.5 $1,183,213.4 $1,408,893.4 New Multi-family 265,188.8 467,418.7 323,462.6 413,368.8 421,365.8 Res. Alterations/Additions 293,210.5 262,864.6 276,570.4 373,409.6 332,233.2 Total Residential 1,666,799.2 1,738,675.0 1,910,412.5 1,969,991.8 2,162,492.4

New Commercial 666,664.3 449,494.3 197,946.8 268,582.0 256,310.9 New Industrial 31,851.4 31,155.0 83,171.4 38,163.3 0.0
New Other 105,555.1 75,356.7 104,932.9 155,071.3 294,989.6 Com. Alterations/Additions 700,604.0 335,458.0 320,447.6 432,950.0 569,570.4 Total Nonresidential $1,504,674.8 $891,464.0 $706,498.7 $894,766.6 $1,120,870.9

New Dwelling Units
Single Family 3,981 3,588 4,205 3,832 4,181
Multiple Family 2,008 2,868 2,266 3,419 6,074
TOTAL 5,989 6,456 6,471 7,251 10,255

Source: Construction Industry Research Board, Building Permit Summary.

ITEM 19.3.

ATTACHMENT 4

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APPENDIX E

FORM OF OPINION OF BOND COUNSEL

[Closing Date]

City Council
City of Rancho Cordova
2729 Prospect Park Drive
Rancho Cordova, California 95670

OPINION: $ ___________ Improvement Area No. 2 of City of Rancho Cordova Grantline 220 Community Facilities District No. 2023-1
Special Tax Bonds Series 2024

Members of the City Council:

We have acted as bond counsel to the City of Rancho Cordova (the “City”) in connection with the delivery by the City of the above -referenced bonds (the “Bonds”), issued pursuant to the provisions of the Mello-Roos Community Facilities Act of 1982, as amended, being California Government Code Section 53311, et seq. (the “Act”), and pursuant to a Fiscal Agent Agreement, dated November 1, 2024, by and between the City and U.S. Bank Trust Company, National Association, as fiscal agent (the “Fiscal Agent Agreement ”). We have examined the Act, an executed copy of the Fiscal Agent Agreement and such certified proceedings and other papers as we deem necessary to render this opinion.

As to questions of fact material to our opinion, we have relied upon representations of the City contained in the Fiscal Agent Agreement and in the certified proceedings and other certifications of public officials furnished to us, without undertaking to verify the same by independent investigation.

Based upon our examination we are of the opinion, under existing law, that:

1. The City is duly organized and existing under the laws of the State of California, with power to enter into the Fiscal Agent Agreement , to perform the agreements on its part contained therein, and to issue the Bonds.

2. The Bonds have been duly authorized, executed and delivered by the City and are legal, valid and binding obligations of the City.

3. The Fiscal Agent Agreement has been duly approved by the City and constitutes a legal, valid and binding obligation of the City, enforceable against the City in accordance with its terms.

4. Pursuant to the Act, the Fiscal Agent Agreement establishes a valid lien on and pledge of the Special Tax Revenues (as defined in the Fiscal Agent Agreement) and the other sources pledged for the security of the Bonds.

5. Interest on the Bonds is excluded from gross income for federal income tax purposes and is not an item of tax preference for purposes of the federal alternative minimum ITEM 19.3.

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tax. The opinions set forth in the preceding sentences are subject to the condition that the City comply with all requirements of the Internal Revenue Code of 1986, as amended, that must be satisfied subsequent to the issuance of the Bonds in order that interest thereon be, or continue to be, excluded from gross income for federal income tax purposes. The City has covenanted to comply with each of such requirements. Failure to comply with certain of such requirements may cause the inclusion of such interest in gross income for federal income tax purposes to be retroactive to the date of delivery of the Bonds.

6. The interest on the Bonds is exempt from personal income taxation imposed by the State of California.

Interest on the Bonds may be subject to the corporate alternative minimum tax. We express no opinion regarding any other tax consequences arising with respect to the ownership, sale or disposition of, or the amount, accrual or receipt of interest on, the Bonds.

The rights of the owners of the Bonds and the enforceability of the Bonds and the Fiscal Agent Agreement may be subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors ’ rights heretofore or hereafter enacted and may also be subject to the exercise of judicial discretion in accordance with principles of equity or otherwise in appropriate cases.

This opinion is given as of the date hereof, and we assume no obligation to revise or supplement this opinion to reflect any facts or circumstances that may hereafter come to our attention, or any changes in law that may hereafter occur. Moreover, our opinions are not a guarantee of a particular result, and are not binding on the Internal Revenue Service or any court; rather, our opinions represent our legal judgment based upon our review of existing law that we deem relevant to such opinions and in reliance upon the representations, opinions, and covenants referenced above.

Our engagement with respect to this matter has terminated as of the date hereof.

Respectfully submitted,

A Professional Law Corporation

ITEM 19.3.

ATTACHMENT 4

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APPENDIX F

FORM OF CONTINUING DISCLOSURE UNDERTAKINGS

CONTINUING DISCLOSURE CERTIFICATE
(City)

$_________
IMPROVEMENT AREA NO. 2 OF

CITY OF RANCHO CORDOVA
GRANTLINE 220 COMMUNITY FACILITIES DISTRICT NO. 2023-1
SPECIAL TAX BONDS SERIES 2024

THIS CONTINUING DISCLOSURE CERTIFICATE (the “Disclosure Certificate ”) is executed and delivered by the City of Rancho Cordova, a public body, corporate and politic, organized and existing under and by virtue of the laws of the State of California (the “City”), in connection with the issuance of the bonds captioned above (the “Bonds”). The Bonds are being issued pursuant to a Fiscal Agent Agreement, dated as of November 1, 2024 (the “Fiscal Agent Agreement”), by and between the City and U.S. Bank Trust Company, National Association , as fiscal agent (the “Fiscal Agent”). The City hereby covenants and agrees as follows:

Section 1. Purpose of the Disclosure Certificate . This Disclosure Certificate is being executed and delivered by the City for the benefit of the holders and beneficial owners of the Bonds and in order to assist the Participating Underwriter in complying with S.E.C. Rule 15c2 - 12(b)(5).

Section 2. Definitions . In addition to the definitions set forth above and in the Fiscal Agent Agreement, which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms shall have the following meanings:

“Annual Report ” means any Annual Report provided by the City pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate.

“Annual Report Date” means the date that is nine months after the end of the City’s fiscal year (currently April 1 based on the City’s fiscal year end of June 30).

“Dissemination Agent ” means Goodwin Consulting Group , or any successor Dissemination Agent designated in writing by the City and which has filed with the City a written acceptance of such designation.

“District” means the City of Rancho Cordova Grantline 220 Community Facilities District No. 2023-1.

“EMMA System” means the Electronic Municipal Market Access system of the MSRB or such other electronic system designated by the MSRB or the Securities and Exchange Commission for compliance with the Rule.

ITEM 19.3.

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“Improvement Area No. 2” means Improvement Area No. 2 of the District.

“Listed Events” means any of the events listed in Section 5(a) of this Disclosure Certificate.

“MSRB” means the Municipal Securities Rulemaking Board, or any other repository of disclosure information that may be designated by the Securities and Exchange Commission as such for purposes of the Rule in the future.

“Official Statement” means the final official statement executed by the City in connection with the issuance of the Bonds.

“Participating Underwriter” means Piper Sandler & Co., as the initial underwriter of the Bonds.

“Rule” means Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as it may be amended from time to time.

Section 3. Provision of Annual Reports.

(a) The City shall, or shall cause the Dissemination Agent to, not later than the Annual Report Date, com mencing April 1, 2025, with the report for the 2023-24 fiscal year, provide to the MSRB through the EMMA System an Annual Report that is consistent with the requirements of Section 4 of this Disclosure Certificate ; provided, the Annual Report for the 2023-24 fiscal year may be satisfied solely with the City’s audited financial statements for such period. Not later than 15 Business Days prior to the Annual Report Date, the City shall provide the Annual Report to the Dissemination Agent (if other than the City). If by 15 Business Days prior to the Annual Report Date the Dissemination Agent (if other than the City) has not received a copy of the Annual Report, the Dissemination Agent shall contact the City to determine if the City is in compliance with the previous sentence. The Annu al Report may be submitted as a single document or as separate documents comprising a package, and may include by reference other information as provided in Section 4 of this Disclosure Certificate; provided that the audited financial statements of the City may be submitted separately from the balance of the Annual Report, and later than the Annual Report Date, if not available by that date. If the City ’s fiscal year changes, it shall give notice of such change in the same manner as for a Listed Event under Section 5(b). The City shall provide a written certification with each Annual Report furnished to the Dissemination Agent to the effect that such Annual Report constitutes the Annual Report required to be furnished by the City hereunder.

(b) If the City does not provide, or cause the Dissemination Agent to provide, an Annual Report by the Annual Report Date as required in subsection (a) above, the Dissemination Agent shall provide in a timely manner to the MSRB through the EMMA System, in an electronic format as prescribed by the MSRB, a notice to such effect.

(c) The Dissemination Agent shall:

(1) determine each year prior to the Annual Report Date the then -applicable rules and electronic format prescribed by the MSRB for the filing of annual continuing disclosure reports; and

ITEM 19.3.

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(2) if the Dissemination Agent is other than the City, file a report with the City and the Participating Underwriter certifying that the Annual Report has been provided pursuant to this Disclosure Certificate, and stating the date it was provided.

Section 4. Content of Annual Reports . The City’ s Annual Report shall contain or incorporate by reference the following documents and information:

(a) Audited Financial Statements prepared in accordance with generally accepted accounting principles as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board. If the Issuer ’s audited financial statements are not available by the time the Annual Report is required to be filed pursuant to Section 3(a), the Annual Report shall contain unaudited financial statements in a format similar to the financial statements contained in the final Official Statement, and the audited financial statements shall be filed in the same manner as the Annual Report when they become available. This submission should be made with the following caveat:

THE CITY’S ANNUAL FINANCIAL STATEMENT IS PROVIDED SOLELY TO COMPLY WITH THE SECURITIES EXCHANGE COMMISSION STAFF ’S INTERPRETATION OF RULE 15c2-12. NO FUNDS OR ASSETS OF THE CITY (OTHER THAN THE PROCEEDS OF THE SPECIAL TAXES LEVIED FOR IMPROVEMENT AREA NO. 2 AND SECURING THE BONDS)

ARE REQUIRED TO BE USED TO PAY DEBT SERVICE ON THE BONDS AND THE CITY IS

NOT OBLIGATED TO ADVANCE AVAILABLE FUNDS FROM THE CITY TREASURY TO COVER ANY DELINQUENCIES. INVESTORS SHOULD NOT RELY ON THE FINANCIAL

CONDITION OF THE CITY IN EVALUATING WHETHER TO BUY, HOLD OR SELL THE BONDS.

(b) The following additional items, indicating information as of the previous September 30th, with respect to the Bonds:

(1) Principal amount of Bonds outstanding under the Fiscal Agent Agreement.

(2) Balance in Reserve Fund.

(3) Table indicating Special Tax levy, amount collected, delinquent amount and percent delinquent for the most recent year , and whether the Special Tax levy is covered by the Teeter Plan.

(4) Status of foreclosure proceedings and summary of results of foreclosure sales, if any.

(5) Identity of any delinquent taxpayer representing more than 5% of levy and value-to-lien ratios of applicable properties (using assessed values unless more accurate information is available without charge to the City).

(6) Aggregate assessed value for all parcels in Improvement Area No. 2.

(7) Until the fiscal year in which the Special Tax levied on the developed property in Improvement Area No. 2 is greater than or equal to the annual debt service on the Bonds, the number of building permits issued by the City for single family residential homes in such fiscal year in Improvement Area No. 2.

ITEM 19.3.

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(c) For so long as there is any owner of property in Improvement Area No. 2 whose properties collectively represent 10% or more of the Special Taxes , the following information regarding the status of development in Improvement Area No. 2:

(1) Significant amendments to land use entitlements.

(2) Status of any legislative, administrative and judicial challenges to the construction of the development known to the City.

(3) Assessed valuation of property shown on County Assessor’s tax rolls with no “improvements” value in Improvement Area No. 2 for the current (as of the date of the report) fiscal year.

(4) List of landowners (as shown County Assessor ’s tax roll) and assessor ’s parcel number(s) of parcels held by owners whose properties collectively represent 10% or more of the Special Taxes for the current (as of the date of the report) fiscal year.

(d) In addition to any of the information expressly required to be provided under paragraphs (a), (b) and (c) of this Section, the Issuer shall provide such further information, if any, as may be necessary to make the specifically required statements, in the light of the circumstances under which they are made, not misleading.

Any or all of the items listed above may be included by specific reference to other documents, including official statements of debt issues of the City or related public entities, which are available to the public on the MSRB’s Internet web site or filed with the Securities and Exchange Commission. The City shall clearly identify each such other document so included by reference.

Section 5. Reporting of Listed Events.

(a) The City shall give, or cause to be given, notice of the occurrence of any of the following Listed Events with respect to the Bonds:

(1) Principal and interest payment delinquencies.
(2) Non-payment related defaults, if material.
(3) Unscheduled draws on debt service reserves reflecting financial difficulties.
(4) Unscheduled draws on credit enhancements reflecting financial difficulties.
(5) Substitution of credit or liquidity providers, or their failure to perform. (6) Rating Changes.
(7) Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701- TEB) or other material notices or determinations with respect to the tax status of the Bonds, or other material events affecting the tax status of the Bonds.
(8) Modifications to rights of security holders, if material. (9) Bond calls, if material, and tender offers.
(10) Defeasances.

ITEM 19.3.

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(11) Release, substitution, or sale of property securing repayment of the securities, if material.(12) Bankruptcy, insolvency, receivership or similar event of the City.
(13) The consummation of a merger, consolidation, or acquisition involving the City, or the sale of all or substantially all of the assets of the City (other than in the ordinary course of business), the entry into a definitive agreement to undertake such an action, or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material.
(14) Appointment of a successor or additional Fiscal Agent or the change of name of the Fiscal Agent, if material.
(15) Incurrence of a financial obligation of the City, if material, or agreement to covenants, events of default, remedies, priority rights, or other similar terms of a financial obligation of the City, any of which affect security holders, if material (for a definition of “financial obligation, ” see clause (e)).
(16) D efault, event of acceleration, termination event, modification of terms, or other similar events under the terms of a financial obligation of the City, any of which reflect financial difficulties (for a definition of “financial obligation,” see clause (e)).

(b) Whenever the City obtains knowledge of the occurrence of a Listed Event, the City shall, or shall cause the Dissemination Agent (if not the City) to, file a notice of such occurrence with the MSRB through the EMMA System, in an electronic format as prescribed by the MSRB, in a timely manner not in excess of 10 business days after the occurrence of the Listed Event. Notwithstanding the foregoing, notice of Listed Events described in subsections (a)(8) and (9) above need not be given under this subsection any earlier than the notice (if any) of the underlying event is given to holders of affected Bonds under the Fiscal Agent Agreement.

(c) The City acknowledges that the events described in subparagraphs (a)(2), (a)(7), (a)(8) (if the event is a bond call), (a)(10), (a)(13), (a)(14) and (a)(15) of this Section 5 contain the qualifier “if material” and that subparagraph (a)(6) also contains the qualifier “material” with respect to certain notices, determinations or other events affecting the tax status of the Bonds. The City shall cause a notice to be filed as set forth in paragraph (b) above with respect to any such event only to the extent that it determines the event’s occurrence is material for purposes of U.S. federal securities law. Whenever the City obtains knowledge of the occurrence of any of these Listed Events, the City will as soon as possible determine if such event would be material under applicable federal securities law. If such event is determined to be material, the City will cause a notice to be filed as set forth in paragraph (b) above.

(d) For purposes of this Disclosure Certificate , any event described in paragraph (a)(12) above is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent, or similar officer for the City in a proceeding under the United States Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the City, or if such jurisdiction has been assumed by leaving the existing governing body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement, or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the City.

ITEM 19.3.

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(e) For purposes of Section 5(a)(15) and (16), “financial obligation” means a (i) debt obligation; (ii) derivative instrument entered into in connection with, or pledged as security or a source of payment for, an existing or planned debt obligation; or (iii) guarantee of (i) or (ii). The term financial obligation shall not include municipal securities as to which a final official statement has been provided to the Municipal Securities Rulemaking Board consistent with the Rule.

Section 6. Identifying Information for Filings with the MSRB. All documents provided to the MSRB under the Disclosure Certificate shall be accompanied by identifying information as prescribed by the MSRB.

Section 7. Termination of Reporting Obligation . The City ’s obligations under this Disclosure Certificate shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds. If such termination occurs prior to the final maturity of the Bonds, the City shall give notice of such termination in the same manner as for a Listed Event under Section 5(b).

Section 8. Dissemination Agent . The City may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Certificate , and may discharge any such Agent, with or without appointing a successor Dissemination Agent. The initial Dissemination Agent will be Goodwin Consulting Group, Inc.

Section 9. Amendment; Waiver . Notwithstanding any other provision of this Disclosure Certificate, the City may amend this Disclosure Certificate, and any provision of this Disclosure Certificate may be waived, provided that the following conditions are satisfied:

(a) if the amendment or waiver relates to the provisions of Sections 3(a), 4 or 5(a), it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature, or status of an obligated person with respect to the Bonds, or type of business conducted;

(b) the undertakings herein, as proposed to be amended or waived, would, in the opinion of nationally recognized bond counsel, have complied with the requirements of the Rule at the time of the primary offering of the Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and

(c) the proposed amendment or waiver either (1) is approved by holders of the Bonds in the manner provided in the Fiscal Agent Agreement for amendments to the Fiscal Agent Agreement with the consent of holders, or (2) does not, in the opinion of the Fiscal Agent or nationally recognized bond counsel, materially impair the interests of the holders or beneficial owners of the Bonds.

If the annual financial information or operating data to be provided in the Annual Report is amended pursuant to the provisions hereof, the first annual financial information filed pursuant hereto containing the amended operating data or financial information shall explain, in narrative form, the reasons for the amendment and the impact of the change in the type of operating data or financial information being provided.

If an amendment is made to the undertaking specifying the accounting principles to be followed in preparing financial statements, the annual financial information for the year in which the change is made shall present a comparison between the financial statements or information ITEM 19.3.

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prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles. The comparison shall include a qualitative discussion of the differences in the accounting principles and the impact of the change in the accounting principles on the presentation of the financial information, in order to provide information to investors to enable them to evaluate the ability of the City to meet its obligations. To the extent reasonably feasible, the comparison shall be quantitative. A notice of the change in the accounting principles shall be filed in the same manner as for a Listed Event under Section 5(b).

Section 10. Additional Information . Nothing in this Disclosure Certificate shall be deemed to prevent the City from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the City chooses to include any information in any Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate , the City shall have no obligation under this Disclosure Certificate to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event.

Section 11. Identifying Information for Filings with EMMA. All documents provided to EMMA under this Disclosure Certificate will be accompanied by identifying information as prescribed by the MSRB.

Section 12. Default. In the event of a failure of the City to comply with any provision of this Disclosure Certificate, the Participating Underwriter or any holder or beneficial owner of the Bonds may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the City to comply with its obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not be deemed an Event of Default under the Fiscal Agent Agreement, and the sole remedy under this Disclosure Certificate in the event of any failure of the City to comply with this Disclosure Certificate shall be an action to compel performance.

Section 1 3. Duties, Immunities and Liabilities of Dissemination Agent . The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate, and the City agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorneys ’ fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent ’s negligence or willful misconduct. The Dissemination Agent shall have no duty or obligation to review any information provided to it hereunder and shall not be deemed to be acting in any fiduciary capacity for the City, the Fiscal Agent, the Bond owners or any other party. The obligations of the City under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds.

Section 14. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the City, the Fiscal Agent, the Dissemination Agent, the Participating Underwriter and holders and beneficial owners from time to time of the Bonds, and shall create no rights in any other person or entity.

ITEM 19.3.

ATTACHMENT 4

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Section 15. Counterparts. This Disclosure Certificate may be executed in several counterparts, each of which shall be regarded as an original, and all of which shall constitute one and the same instrument.

Date: _________, 2024
CITY OF RANCHO CORDOVA for and on
behalf of CITY OF RANCHO CORDOVA
GRANTLINE 220 COMMUNITY
FACILITIES DISTRICT NO. 2023-1

By:

Authorized Officer

AGREED AND ACCEPTED:

GOODWIN CONSULTING GROUP,
as Dissemination Agent

By:

Name:

Title:

ITEM 19.3.

ATTACHMENT 4

F-9

CONTINUING DISCLOSURE CERTIFICATE
(Developer)

Relating to:

$_________
IMPROVEMENT AREA NO. 2 OF

CITY OF RANCHO CORDOVA
GRANTLINE 220 COMMUNITY FACILITIES DISTRICT NO. 2023-1
SPECIAL TAX BONDS SERIES 2024

THIS CONTINUING DISCLOSURE CERTIFICATE ( Developer) (the “Disclosure Certificate”) dated as of _________, 2024, is executed and delivered by Lennar Homes of California, LLC, a California limited liability company (the “Developer”) in connection with the issuance by the City of Rancho Cordova (the “City”) of its $_________ Improvement Area No. 2 of City of Rancho Cordova Grantline 220 Community Facilities District No. 2023-1 Special Tax Bonds Series 2024 (the “Bonds”). The Bonds are being executed and delivered pursuant to a Fiscal Agent Agreement, dated as of November 1, 2024 (the “Fiscal Agent Agreement”), by and between the City and U.S. Bank Trust Company, National Association , as fiscal agent (the “Fiscal Agent”). The Developer covenants and agrees as follows:

Section 1. Purpose of the Disclosure Certificate . This Disclosure Certificate is being executed and delivered by the Developer for the benefit of the holders and beneficial owners of the Bonds.

Section 2. Definitions. In addition to the definitions set forth herein and in the Fiscal Agent Agreement, which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Disclosure Certificate, the following capitalized terms shall have the following meanings:

“Affiliate” means with respect to the Developer, means any other Person (i) who directly, or indirectly through one or more intermediaries, is currently controlling, controlled by or under common control with the Developer, and (ii) for whom information, including financial information or operating data, concerning such Person is material to potential investors in their evaluation of Improvement Area No. 2 and investment decision regarding the Bonds (i.e., information regarding such Person’s assets or funds that would materially affect the Developer’s ability to develop the Property as described in the Official Statement or to pay its Special Taxes on the Property (to the extent the responsibility of the Developer) prior to delinquency). For purposes hereof, the term “control” (including the terms “controlling,” “controlled by” or “under common control with”) means the present possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise . The Land Bank Owner is not an Affiliate of the Developer.

“Assumption Agreement” means an undertaking of a Major Owner, or an Affiliate thereof, for the benefit of the holders and beneficial owners of the Bonds containing terms substantially similar to this Disclosure Certificate (as modified for such Major Owner ’s development and financing plans with respect to Improvement Area No. 2), whereby such Major Owner or Affiliate agrees to provide Periodic Reports and notices of significant events, setting forth the information described in sections 4 and 5 hereof, respectively, with respect to the portion of the property in Improvement Area No. 2 owned by such Major Owner and its Affiliates and, at the option of the ITEM 19.3.

ATTACHMENT 4

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Developer or such Major Owner, agrees to indemnify the Dissemination Agent (if any) pursuant to a provision substantially in the form of Section 11 hereof.

“Developer” means Lennar Homes of California, LLC, a California limited liability company, its successors and assigns.

“Dissemination Agent” means the entity acting in its capacity as Dissemination Agent hereunder, or any successor Dissemination Agent designated in writing by the Developer and which has filed with the Developer, the City, and the Participating Underwriter a written acceptance of such designation, and which is experienced in providing dissemination agent services such as those required under this Disclosure Certificate . The I nitial Dissemination Agent is the Developer.

“District” means the City of Rancho Cordova Grantline 220 Community Facilities District No. 2023-1.

“EMMA” shall mean the Municipal Securities Rulemaking Board’s Electronic Municipal Market Access System for municipal securities disclosures, maintained on the Internet at http://emma.msrb.org/.

“Improvement Area No. 2” means Improvement Area No. 2 of the District.

“Land Bank Owner” means AG EHC II (LEN) CA 2, L.P., a Delaware limited partnership, as the land banking entity under the Option Agreement.

“Listed Events” means any of the events listed in Section 5(a) of this Disclosure Certificate.

“Major Owner” means, as of any Report Date, an owner of land in Improvement Area No. 2 that is responsible in the aggregate for 20% or more of the Special Taxes anticipated to be levied at any time during the then-current fiscal year.

“Official Statement” means the final official statement executed by the City in connection with the issuance of the Bonds.

“Option Agreement” means that certain Option Agreement, dated May 26, 2023, between the Land Bank Owner and the Developer.

“Participating Underwriter” means Piper Sandler & Co., the original underwriter of the Bonds.

“Periodic Report ” means any Periodic Report provided by the Developer pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate.

“Person” means an individual, a corporation, a partnership, a limited liability company, an association, a joint stock company, a trust, any unincorporated organization or a government or political subdivision thereof.

“Property” means the real property in Improvement Area No. 2 that is owned by (i) the Developer, (ii) any Affiliate of the Developer, and (iii) the Land Bank Owner (during the term of the Option Agreement).

ITEM 19.3.

ATTACHMENT 4

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“Report Date” means April 1 and October 1 of any fiscal year. If, in any year, the Report Date falls on a Saturday, Sunday, or a holiday, such Report Date shall be extended to the next following day that is not a Saturday, Sunday, or holiday.

“Special Taxes” means the special taxes levied on taxable property in Improvement Area No. 2.

Section 3. Provision of Periodic Reports.

(a) The Developer shall, or, upon written direction of the Developer the Dissemination Agent shall, not later than the Report Date, commencing April 1, 2025 , file or cause to be filed with EMMA a Periodic Report which is consistent with the requirements of Section 4 of this Disclosure Certificate with a copy to the Participating Underwriter and the City.

Not later than 15 calendar days prior to the Report Date, the Developer shall provide the Periodic Report to the Dissemination Agent (if different from the Developer). The Developer shall provide a written certification with (or included as a part of) each Periodic Report furnished to the Dissemination Agent (if different from the Developer), the Participating Underwriter and the City to the effect that such Periodic Report constitutes the Periodic Report required to be furnished by it under this Disclosure Certificate. The Dissemination Agent, the Participating Underwriter and the City may conclusively rely upon such certification of the Developer and shall have no duty or obligation to review the Periodic Report. The Periodic Report may be submitted as a single document or as separate documents comprising a package and may incorporate by reference other information as provided in Section 4 of this Disclosure Certificate.

(b) If the Dissemination Agent does not receive a Periodic Report by 15 calendar days prior to the Report Date, the Dissemination Agent shall send a reminder notice to the Developer that the Periodic Report has not been provided as required under Section 3(a) above. The reminder notice shall instruct the Developer to determine whether its obligations under this Disclosure Certificate have terminated (pursuant to Section 6 below) and, if so, to provide the Dissemination Agent with a notice of such termination in the same manner as for a Listed Event (pursuant to Section 5 below). If the Developer does not provide, or cause the Dissemination Agent to provide, a Periodic Report to EMMA by the Report Date as required in subsection (a) above, the Dissemination Agent shall send a notice to EMMA in the form at prescribed by the MSRB, with a copy to City and the Participating Underwriter.

(c) With respect to the Periodic Report, the Dissemination Agent shall, to the extent the Periodic Report has been furnished to it, file the Periodic Report with EMMA and file a report with the Developer (if the Dissemination Agent is other than the Developer), the City and the Participating Underwriter certifying that the Periodic Report has been provided pursuant to this Disclosure Certificate, stating the date it was provided to and filed with EMMA.

Section 4. Content of Periodic Reports . The Developer ’s Periodic Report shall contain or incorporate by reference the information set forth in Exhibit A relating to the Developer, any or all of which may be included by specific reference to other documents, including official statements of debt issues of the Developer or related public entities, which have been submitted to EMMA or the Securities and Exchange Commission. If the document included by reference is a final official statement, it must be available from EMMA. The Developer shall clearly identify each such other document so included by reference.

ITEM 19.3.

ATTACHMENT 4

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In addition to any of the information expressly required to be provided in Exhibit A, the Developer’s Periodic Report shall include such further information, if any, as may be necessary to make the specifically required statements, in the light of the circumstances under which they are made, not misleading.

Section 5. Reporting of Significant Events.

(a) The Developer shall give, or cause to be given, notice of the occurrence of any of the following Listed Events with respect to itself or the Property, if material:

(i) bankruptcy or insolvency proceedings commenced by or against the Developer and, if known, any bankruptcy or insolvency proceedings commenced by or against any Affiliate of the Developer that is reasonably likely to have a significant impact on the Developer’s ability to pay Special Taxes on the Property or to sell or develop the Property;

(ii) failure to pay any taxes, special taxes (including the Special Taxes) or assessments due with respect to the Property on or prior to the delinquency date to the extent such failure is not promptly cured by the Developer upon discovery thereof;

(iii) filing of a lawsuit of which the Developer is aware against the Developer or an Affiliate seeking damages, which is reasonably likely to have a significant impact on the Developer’s ability to pay Special Taxes on the Property or to sell or develop the Property;

(iv) material damage to or destruction of any of the improvements on the Property; and

(v) any payment default or other material default by the Developer on the Option Agreement or any loan with respect to the construction of improvements on the Property.

(b) Whenever the Developer obtains knowledge of the occurrence of a Listed Event, the Developer shall as soon as possible determine if such event would be material under applicable Federal securities law.

(c) If the Developer determines that knowledge of the occurrence of a Listed Event would be material under applicable Federal securities law, the Developer shall, or shall cause the Dissemination Agent to, promptly file a notice of such occurrence with EMMA, with a copy to the City and the Participating Underwriter.

Section 6. Duration of Reporting Obligation.

(a) All the Developer ’s obligations hereunder shall commence on the date hereof and terminate (except as provided in Section 11) on the earliest to occur of the following:

(i) upon the legal defeasance, prior redemption or payment in full of all the Bonds, or

ITEM 19.3.

ATTACHMENT 4

F-13
(ii) at such time as Property owned by the Developer and the Land Bank Owner (during the term of the Option Agreement) is no longer responsible for payment of 20% or more of the Special Taxes levied in Improvement Area No. 2, or

(iii) the date on which the Developer prepays in full all of the Special Taxes attributable to the Property.

The Developer shall give notice of the termination of its obligations under this Disclosure Certificate in the same manner as for a Listed Event under Section 5.

(b) If a portion of the Property owned by the Developer, or any Affiliate of the Developer, is conveyed to a Person that, upon such conveyance, will be a Major Owner, the obligations of the Developer hereunder with respect to the property in Improvement Area No. 2 owned by such Major Owner and its Affiliates may be assumed by such Major Owner or by an Affiliate thereof, and if so assumed the Developer ’s obligations hereunder with respect to such portion of the Property will be terminated. In order to effect such an assumption, such Major Owner or Affiliate shall enter into an Assumption Agreement. If not so assumed, the Developer shall report the information, as applicable to the transferee, required herein so long as the transferee is a Major Owner.

Section 7. Dissemination Agent . The Developer may, from time to time, appoint or engage a Dissemination Agent to assist the Developer in carrying out its obligations under this Disclosure Certificate, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. The initial Dissemination Agent shall be the Developer. The Dissemination Agent may resign by providing thirty days ’ written notice to the City, the Participating Underwriter and the Developer . The acquisition of any portion of the Property by the Developer pursuant to the Option Agreement shall not require any assumption by the Developer.

Section 8. No Amendment. The Developer may not amend this Disclosure Certificate.

Section 9. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the Developer from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Periodic Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the Developer chooses to include any information in any Periodic Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the Developer shall have no obligation under this Disclosure Certificate to update such information or include it in any future Periodic Report or notice of occurrence of a Listed Event.

Section 10. Default. In the event of a failure of the Developer to comply with any provision of this Disclosure Certificate, the Participating Underwriter and any holder or beneficial owner of the Bonds may, take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Developer to comply with its obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not be deemed an Event of Default under the Fiscal Agent Agreement, and the sole and exclusive remedy under this Disclosure Certificate in the event of any failure of the Developer to comply with this Disclosure Certificate shall be an action to compel performance. Neither the Developer nor the Dissemination Agent shall have any liability to any holder or beneficial owner ITEM 19.3.

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of the Bonds or any other party for monetary damages or financial liability of any kind whatsoever arising from or relating to this Disclosure Certificate.

Section 11. Duties, Immunities and Liabilities of Dissemination Agent . The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate, and the Developer agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents (each, an “Indemnified Party”), harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the reasonable costs and expenses (including attorneys’ fees) of defending against any claim of liability, but excluding loss, liabilities, costs and expenses due to an Indemnified Party ’s negligence or willful misconduct or failure to perform its duties hereunder. The Dissemination Agent shall be paid compensation for its services provided hereunder in accordance with its schedule of fees as amended from time to time, which schedule, as amended, shall be reasonably acceptable, and all reasonable expenses, reasonable legal fees and advances made or incurred by the Dissemination Agent in the performance of its duties hereunder. The Dissemination Agent shall have no duty or obligation to review any information provided to it hereunder and shall not be deemed to be acting in any fiduciary capacity for the City, the Developer, the Fiscal Agent, the Bond owners, or any other party. The obligations of the Developer under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds.

Section 12. Notices . Any notice or comm unications to be among any of the parties to this Disclosure Certificate may be given by regular, overnight or electronic mail as follows:

To the Developer Lennar Homes of California, LLC
1025 Creekside Ridge Drive, Suite 240
Roseville, CA 95678
Email: [email protected]
Email: [email protected]

To the City: City of Rancho Cordova
Attn: CFD Administrator
2729 Prospect Park Drive
Rancho Cordova, CA 95670
Email: [email protected]
[email protected]

To the Participating
Underwriter: Piper Sandler & Co.
3626 Fair Oaks Boulevard, Suite 100
Sacramento, CA 95864
Email: [email protected]

Any person may, by written notice to the other persons listed above, designate a different address or telephone number(s) to which subsequent notices or communications should be sent.

ITEM 19.3.

ATTACHMENT 4

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Section 13. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the City, the Developer (its successors and assigns), the Dissemination Agent, the Participating Underwriter and holders and beneficial owners from time to time of the Bonds and shall create no rights in any other person or entity. All obligations of the Developer hereunder shall be assumed by any legal successor to the obligations of the Developer as a result of a sale, merger, consolidation or other reorganization.

Section 14. Counterparts. This Disclosure Certificate may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.

IN WITNESS WHEREOF, the Developer has executed this Disclosure Certificate as of the date first above written.

LENNAR HOMES OF CALIFORNIA, LLC,
A California limited liability company

By: ______________________________

Name: ___________________________

Title: _____________________________

ITEM 19.3.

ATTACHMENT 4

F-16

EXHIBIT A

PERIODIC REPORT

Relating to:

$_________
IMPROVEMENT AREA NO. 2 OF

CITY OF RANCHO CORDOVA
GRANTLINE 220 COMMUNITY FACILITIES DISTRICT NO. 2023-1
SPECIAL TAX BONDS SERIES 2024

This Periodic Report is hereby submitted under Section 4 of the Continuing Disclosure Certificate (Developer) (the “Disclosure Certificate”) dated November ___, 2024, executed by Lennar Homes of California, LLC, a California limited liability company (the “Developer”) in connection with the issuance of special tax bonds by the City of Rancho Cordova (the “City”) with respect to Improvement Area No. 2 of City of Rancho Cordova Grantline 220 Community Facilities District No. 2023-1 (“Improvement Area No. 2”).

Capitalized terms used in this Periodic Report but not otherwise defined have the meanings given to them in the Disclosure Certificate.

I. Property Ownership and Development

The information in this section is provided as of ____________________ (this date must be not more than 60 days before the date of this Periodic Report).

A. Property currently owned by the Developer or its Affiliates (if any) and the Land Bank Owner in Improvement Area No. 2 (the “Property”):

Development name:

Number of lots (acreage if not subdivided):

B. Status of land development or construction activities:

______________________________________________________________________

______________________________________________________________________

C. Number of building permits pulled during the reporting period and the aggregate number of building permits for the Property developed by the Developer or an Affiliate (if any) , and any significant amendments to land use or development entitlements:

______________________________________________________________________

______________________________________________________________________

D. Aggregate property sold, optioned or leased by the Developer or an Affiliate (if any) to end users or merchant builders:

ITEM 19.3.

ATTACHMENT 4

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Since the Reported Date of
Information in the Official
Statement
Since the Last Periodic
Report

Lots ____

Lots ____

E. Any updates to ownership of the Property by the Developer or an Affiliate (if any), as stated in the Official Statement, and any other changes in ownership, whether acquisition of land in Improvement Area No. 2 by the Developer or an Affiliate (if any), or sales of land in Improvement Area No. 2 to other property owners, distinguishing between (i) end users (e.g., single family homeowners), (ii) developers and (iii) merchant builders.

______________________________________________________________________

______________________________________________________________________

II. Legal and Financial Status of Developer

Unless such information has previously been included or incorporated by reference in a Periodic Report, describe any change in the legal structure of the Developer or the financial condition and financing plan of the Developer that would materially and adversely interfere with its ability to complete its development plan described in the Official Statement.

______________________________________________________________________

______________________________________________________________________

III. Change in Development or Financing Plans

Unless such information has previously been included or incorporated by reference in a Periodic Report, describe any development plans or financing plans relating to the Property that are materially different from the proposed development and financing plan described in the Official Statement.
______________________________________________________________________

______________________________________________________________________

IV. Official Statement Updates

Unless such information has previously been included or incorporated by reference in a Periodic Report, describe any other significant changes in the information relating to the Developer or the Property contained in the Official Statement under the heading “IMPROVEMENT AREA NO. 2 – Development in the District ” that would materially and adversely interfere with the Developer’ s ability to develop and sell the Property as described in the Official Statement.

______________________________________________________________________

______________________________________________________________________ ITEM 19.3.

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V. Other Material Information

In addition to any of the information expressly required above, provide such further information, if any, as may be necessary to make the specifically required statements, in the light of the circumstances under which they are made, not misleading.

_____________________________________________________________________

______________________________________________________________________

Certification

The undersigned Developer hereby certifies that this Periodic Report constitutes the Periodic Report required to be furnished by the Developer under the Disclosure Certificate.

ANY STATEMENTS REGARDING THE DEVELOPER, THE DEVELOPMENT OF THE PROPERTY, THE DEVELOPER ’S FINANCING PLAN OR FINANCIAL CONDITION, OR THE

BONDS, OTHER THAN STATEMENTS MADE BY THE DEVELOPER IN AN OFFICIAL

RELEASE, OR FILED WITH THE MUNICIPAL SECURITIES RULEMAKING BOARD, ARE NOT AUTHORIZED BY THE DEVELOPER. THE DEVELOPER IS NOT RESPONSIBLE FOR

THE ACCURACY, COMPLETENESS OR FAIRNESS OF ANY SUCH UNAUTHORIZED STATEMENTS.

THE DEVELOPER HAS NO OBLIGATION TO UPDATE THIS PERIODIC REPORT OTHER THAN AS EXPRESSLY PROVIDED IN THE DISCLOSURE CERTIFICATE.

Dated:

LENNAR HOMES OF CALIFORNIA, LLC,
A California limited liability company

By: ______________________________

Name: ___________________________

Title: _____________________________

ITEM 19.3.

ATTACHMENT 4

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APPENDIX G

DTC AND THE BOOK-ENTRY ONLY SYSTEM

The following description of the Depository Trust Company ( “DTC”), the procedures and record keeping with respect to beneficial ownership interests in the Bonds, payment of principal, interest and other payments on the Bonds to DTC Participants or Beneficial Owners, confirmation and transfer of beneficial ownership interest in the Bonds and other related transactions by and between DTC, the DTC Participants and the Beneficial Owners is based solely on information provided by DTC. Accordingly, no representations can be made concerning these matters and neither the DTC Participants nor the Beneficial Owners should rely on the foregoing information with respect to such matters, but should instead confirm the same with DTC or the DTC Participants, as the case may be.

Neither the issuer of the Bonds (the “Issuer”) nor the trustee, fiscal agent or paying agent appointed with respect to the Bonds (the “Agent”) take any responsibility for the information contained in this Appendix.

No assurances can be given that DTC, DTC Participants or Indirect Participants will distribute to the Beneficial Owners (a) payments of interest, principal or premium, if any, with respect to the Bonds, (b) certificates representing ownership interest in or other confirmation or ownership interest in the Bonds, or (c) redemption or other notices sent to DTC or Cede & Co., its nominee, as the registered owner of the Bonds, or that they will so do on a timely basis, or that DTC, DTC Participants or DTC Indirect Participants will act in the manner described in this Appendix. The current “Rules” applicable to DTC are on file with the Securities and Exchange Commission and the current “Procedures” of DTC to be followed in dealing with DTC Participants are on file with DTC.

1. The Depository Trust Company ( “DTC”) will act as securities depository for the securities (the “Securities”). The Securities will be issued as fully-registered securities registered in the name of Cede & Co. (DTC ’s partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully -registered Security certificate will be issued for each issue of the Securities, each in the aggregate principal amount of such issue, and will be deposited with DTC. If, however, the aggregate principal amount of any issue exceeds $500 million, one certificate will be issued with respect to each $500 million of principal amount, and an additional certificate will be issued with respect to any remaining principal amount of such issue.

2. DTC, the world ’s largest securities depository, is a limited -purpose trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “clearing corporation ” within the meaning of the New York Uniform Commercial Code, and a “clearing agency ” registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934.

DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non -U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC ’s participants (“ Direct Participants”) deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants ’ accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non -U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is ITEM 19.3.

ATTACHMENT 4

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a wholly-owned subsidiary of The Depository Trust & Clearing Corporation ( “DTCC”). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non -U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ( “Indirect Participants”). DTC has a Standard & Poor’ s rating of AA+.

The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com.

3. Purchases of Securities under the DTC system must be made by or through Direct Participants, which will receive a credit for the Securities on DTC ’s records. The ownership interest of each actual purchaser of each Security ( “Beneficial Owner”) is in turn to be recorded on the Direct and Indirect Participants’ records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Securities are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Securities, except in the event that use of the book -entry system for the Securities is discontinued.

4. To facilitate subsequent transfers, all Securities deposited by Direct Participants with DTC are registered in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of Securities with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Securities; DTC’ s records reflect only the identity of the Direct Participants to whose accounts such Securities are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers.

5. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of Securities may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Securities, such as redemptions, tenders, defaults, and proposed amendments to the Security documents. For example, Beneficial Owners of Securities may wish to ascertain that the nominee holding the Securities for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided directly to them.

6. Redemption notices will be sent to DTC. If less than all of the Securities within an issue are being redeemed, DTC ’s practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed.

7. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Securities unless authorized by a Direct Participant in accordance with DTC ’s MMI ITEM 19.3.

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Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to Issuer as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co. ’s consenting or voting rights to those Direct Participants to whose accounts Securities are credited on the record date (identified in a listing attached to the Omnibus Proxy).

8. Redemption proceeds, distributions, and dividend payments on the Securities will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC ’s practice is to credit Direct Participants ’ accounts upon DTC ’s receipt of funds and corresponding detail information from Issuer or Agent, on payable date in accordance with their respective holdings shown on DTC’s records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in “street name,” and will be the responsibility of such Participant and not of DTC, Agent, or Issuer, subject to any statutory or regulatory requirements as may be in effect from time to time.

Payment of redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of Issuer or Agent, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.

9. A Beneficial Owner will give notice to elect to have its Securities purchased or tendered, through its Participant, to the Agent, and will effect delivery of such Securities by causing the Direct Participant to transfer the Participant ’s interest in the Securities, on DTC ’s records, to the Agent. The requirement for physical delivery of Securities in connection with an optional tender or a mandatory purchase will be deemed satisfied when the ownership rights in the Securities are transferred by Direct Participants on DTC ’s records and followed by a book - entry credit of tendered Securities to the Agent’s DTC account.

10. DTC may discontinue providing its services as depository with respect to the Securities at any time by giving reasonable notice to Issuer or Agent. Under such circumstances, in the event that a successor depository is not obtained, Security certificates are required to be printed and delivered.

11. Issuer may decide to discontinue use of the system of book -entry-only transfers through DTC (or a successor securities depository). In that event, Security certificates will be printed and delivered to DTC.

12. The information in this section concerning DTC and DTC’ s book-entry system has been obtained from sources that Issuer believes to be reliable, but Issuer takes no responsibility for the accuracy thereof.

ITEM 19.3.

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