Agenda packet — Roseville City Council, June 21, 2023 (part 5 of 9)

REQUEST FOR BUDGET ADJUSTMENT
REQUESTER NAME & TITLE: Rendi Hodge, Management Analyst FISCAL YEAR: 2022-23 PREPARER NAME & TITLE: Rendi Hodge, Management Analyst COUNCIL DATE (if applicable): 6/21/23 DEPARTMENT/DIVISION: Parks, Recreation & Libraries/PRL Admin ORDINANCE:

EXPENDITURES/EXPENSES/TRANSFERS OUT
BUDGET ($)
Fund Account Center Project Adjustment
1201 6801 10001 45,000
1201 5388 58130 17,802
1201 5585 58130 4,500
67,302

REVENUES/TRANSFERS IN
BUDGET ($)
Fund Account Center Project Adjustment
3303 4801 10001 45,000
45,000
22,302

FUND BALANCE
BUDGET ($)
Fund Account Center Project Adjustment
3303 45,000
1201 (67,302)
(22,302)
Justification for Budget Adjustment:

REQUESTING DEPARTMENT HEAD / DESIGNEE DATE BUDGET MANAGER / DESIGNEE DATE

CHIEF FINANCIAL OFFICER / DESIGNEE DATE CITY MANAGER / DESIGNEE DATE

POSTED BY DATE
Revised: June 24, 2019
The Parks, Recreation & Libraries Department requests a budget adjustment of $67,302 to allocate a $22,302 budget for Fund 1201 (Youth Sports Coalition) and correct a $45,000 expense charged to Fund 3303 (Citywide Park). Beginning in FY2019-20, expenditures made on behalf of the Youth Sports Coalition (YSC) were charged to Fund 3303 (Citywide Park) without the appropriate offsetting reimbursement from Fund 1201 (YSC). This budget adjustment will correct the reimbursement by moving $45,000 from Fund 1201 to Fund 3303 to ensure the fund balance reflects actual spending by the Youth Sports Coalition. Additionally, Fund 1201 did not have any budget authority for FY2022-23, and this budget adjustment will establish the budget for current expenses totaling $22,302 for reimbursement to sports leagues and scholarships. There is no impact on the General Fund.

REQUIRED APPROVALS:

BUDGET DEPARTMENT USE ONLY:

TOTAL
TOTAL

NET ADJUSTMENT

ACCOUNT STRING DESCRIPTION
Increase in available resources
Decrease in available resources

ACCOUNT STRING DESCRIPTION
Transfer funds from Fund 1201 to Fund 3303
Establish budget for YSC scholarships
TOTAL

ACCOUNT STRING DESCRIPTION
Transfer funds from Fund 1201 to Fund 3303
Establish budget for YSC reimbursement to
leagues
06/06/2023
ORDINANCE NO. 6674

ORDINANCE OF THE COUNCIL OF THE CITY OF ROSEVILLE
AUTHORIZING CERTAIN AMENDMENTS TO THE FISCAL YEAR 2022-23

BUDGET AND DECLARING THIS ORDINANCE TO BE IMMEDIATELY

EFFECTIVE AS AN APPROPRIATION MEASURE
THE CITY OF ROSEVILLE ORDAINS:

SECTION 1. The City of Roseville Annual Budget, Fiscal Year 2022-23, is hereby amended as listed on the attached budget adjustment for the Roseville Aquatics Maintenance Fund/General Fund.

SECTION 2. This ordinance is hereby declared to be an appropriation measure, immediately effective pursuant to the provisions of Section 5.03 of the Charter.

SECTION 3. The City Clerk is hereby authorized and directed to post a true copy of the foregoing ordinance in each of three (3) conspicuous locations in the City and she shall immediately after such posting enter in the ordinance book, under the record of the ordinance, a certificate under her hand stating the time and place of such publication by posting.

PASSED AND ADOPTED by the Council of the City of Roseville, this ______________ day of _________________, 2023, by the following vote on roll call:

AYES COUNCILMEMBERS:

NOES COUNCILMEMBERS:

ABSENT COUNCILMEMBERS:
_______________________________
MAYOR
ATTEST:
__________________________
City Clerk
5/31/20232:33 PM
1 REQUEST FOR BUDGET ADJUSTMENT
REQUESTER NAME & TITLE: Rendi Hodge, Management Analyst FISCAL YEAR: FY2022-23 PREPARER NAME & TITLE: Rendi Hodge, Management Analyst COUNCIL DATE (if applicable): 6/21/23 DEPARTMENT/DIVISION: Parks, Recreation & Libraries/PRL Admin ORDINANCE:

Expenditures/Expenses/Transfers Out
BUDGET ($)
Fund Account Center Project Adjustment
2551 6801 10001 78,579
78,579
Revenues/Transfers In
BUDGET ($)
Fund Account Center Project Adjustment
1001 4801 10001 78,579
78,579
-
Available Resources
BUDGET ($)
Fund Account Center Project Adjustment
1001 78,579
2551 (78,579)
-
Justification for Budget Adjustment:

REQUESTING DEPARTMENT HEAD / DESIGNEE DATE BUDGET MANAGER / DESIGNEE DATE

CHIEF FINANCIAL OFFICER / DESIGNEE DATE CITY MANAGER / DESIGNEE DATE

POSTED BY DATE

ACCOUNT STRING

DESCRIPTION

NET ADJUSTMENT

ACCOUNT STRING DESCRIPTION
TOTAL
Transfer of FY22 Roseville Aquatics Maintenance Fund
annual payment to Aquatics Operations (General Fund)
as part of an agreement with school district
TOTAL
Transfer funds from Fund 2551 to 1001 for FY22 RAC
Maintenance annual payment to Aquatics Operations
REQUIRED APPROVALS:

BUDGET DEPARTMENT USE ONLY:

In FY2021-22, the annual RAC Maintenance Fund journal entry was not completed and the funds were not transfered from Fund 2551 (RAC Maintenance Fund) to the Aquatics Operations budget in the General Fund (1001.58260). This budget adjustment will correct the reimbursement by moving funds from Fund 2551 to Fund 1001 to ensure the fund balance reflects actual spending by the RAC Maintenace Fund per the agreement with the Roseville Joint Union High School District.

TOTAL
Decrease available resources

ACCOUNT STRING

DESCRIPTION
Increase available resources
05/31/2023
ORDINANCE NO. 6675

ORDINANCE OF THE COUNCIL OF THE CITY OF ROSEVILLE
AUTHORIZING CERTAIN AMENDMENTS TO THE FISCAL YEAR 2022-23

BUDGET AND DECLARING THIS ORDINANCE TO BE IMMEDIATELY

EFFECTIVE AS AN APPROPRIATION MEASURE
THE CITY OF ROSEVILLE ORDAINS:

SECTION 1. The City of Roseville Annual Budget, Fiscal Year 2022-23, is hereby amended as listed on the attached budget adjustment for the Roseville Energy Park Exterior Paint project.

SECTION 2. This ordinance is hereby declared to be an appropriation measure, immediately effective pursuant to the provisions of Section 5.03 of the Charter.

PASSED AND ADOPTED by the Council of the City of Roseville, this ______________ day of _________________, 2023, by the following vote on roll call:

AYES COUNCILMEMBERS:

NOES COUNCILMEMBERS:

ABSENT COUNCILMEMBERS:
_______________________________
MAYOR
ATTEST:
__________________________
City Clerk

ORDINANCE NO. 6676

ORDINANCE OF THE COUNCIL OF THE CITY OF ROSEVILLE
AUTHORIZING CERTAIN AMENDMENTS TO THE FISCAL YEAR 2022-23

BUDGET AND DECLARING THIS ORDINANCE TO BE IMMEDIATELY

EFFECTIVE AS AN APPROPRIATION MEASURE
THE CITY OF ROSEVILLE ORDAINS:

SECTION 1. The City of Roseville Annual Budget, Fiscal Year 2022-23, is hereby amended as listed on the attached budget adjustment for General Fund Annexation payments.

SECTION 2. This ordinance is hereby declared to be an appropriation measure, immediately effective pursuant to the provisions of Section 5.03 of the Charter.

PASSED AND ADOPTED by the Council of the City of Roseville, this ______________ day of _________________, 2023, by the following vote on roll call:

AYES COUNCILMEMBERS:

NOES COUNCILMEMBERS:

ABSENT COUNCILMEMBERS:
_______________________________
MAYOR
ATTEST:
__________________________
City Clerk

REQUEST FOR BUDGET ADJUSTMENT
REQUESTER NAME & TITLE: Scott Pettingell, Assistant Finance Director FISCAL YEAR: 2022-23 PREPARER NAME & TITLE: Natalya Lakhno, Budget Analyst COUNCIL DATE (if applicable): 6/21/23 DEPARTMENT/DIVISION: Finance / Budget ORDINANCE:

EXPENDITURES/EXPENSES/TRANSFERS OUT
BUDGET ($)
Fund Account Center Project Adjustment
1001 5585 10011 245,000
245,000

REVENUES/TRANSFERS IN
BUDGET ($)
Fund Account Center Project Adjustment
1001 4001 10001 245,000
245,000
-

FUND BALANCE
BUDGET ($)
Fund Account Center Project Adjustment
-
Justification for Budget Adjustment:

REQUESTING DEPARTMENT HEAD / DESIGNEE DATE BUDGET MANAGER / DESIGNEE DATE

CHIEF FINANCIAL OFFICER / DESIGNEE DATE CITY MANAGER / DESIGNEE DATE

POSTED BY DATE
Revised: June 24, 2019

DESCRIPTION
REQUIRED APPROVALS:

BUDGET DEPARTMENT USE ONLY:

This adjustment is recommended to increase the budget for annexation payments, which are paid based on the City's tax-sharing agreements with Placer County in annexation areas. The brings the City's total estimate payment for FY2022-23 to $10,145,000. The increase is proposed to be funded by higher than anticipated secured property tax revenues.

TOTAL

ACCOUNT STRING DESCRIPTION
Increase expenditure budget for annexation payments

NET ADJUSTMENT

ACCOUNT STRING DESCRIPTION
TOTAL
Increase in Secured Property Tax revenues

ACCOUNT STRING
TOTAL
6/1/20231:02 PM
1 ORDINANCE NO. 6677

ORDINANCE OF THE COUNCIL OF THE CITY OF ROSEVILLE
AUTHORIZING CERTAIN AMENDMENTS TO THE FISCAL YEAR 2022-23

BUDGET AND DECLARING THIS ORDINANCE TO BE IMMEDIATELY

EFFECTIVE AS AN APPROPRIATION MEASURE
THE CITY OF ROSEVILLE ORDAINS:

SECTION 1. The City of Roseville Annual Budget, Fiscal Year 2022-23, is hereby amended as listed on the attached budget adjustment for American Rescue Plan Act (ARPA) project revenue.

SECTION 2. This ordinance is hereby declared to be an appropriation measure, immediately effective pursuant to the provisions of Section 5.03 of the Charter.

PASSED AND ADOPTED by the Council of the City of Roseville, this ______________ day of _________________, 2023, by the following vote on roll call:

AYES COUNCILMEMBERS:

NOES COUNCILMEMBERS:

ABSENT COUNCILMEMBERS:
_______________________________
MAYOR
ATTEST:
__________________________
City Clerk

EXPENDITURES/EXPENSES/TRANSFERS OUT
BUDGET ($)
Fund Account Center Project Adjustment
-

REVENUES/TRANSFERS IN
BUDGET ($)
Fund Account Center Project Adjustment
2280 4401 10001 1,099,308
1,099,308
(1,099,308)

FUND BALANCE
BUDGET ($)
Fund Account Center Project Adjustment
2280 1,099,308
1,099,308
Justification for Budget Adjustment:

REQUESTING DEPARTMENT HEAD / DESIGNEE DATE BUDGET MANAGER / DESIGNEE DATE

CHIEF FINANCIAL OFFICER / DESIGNEE DATE CITY MANAGER / DESIGNEE DATE

POSTED BY DATE
Revised: June 24, 2019

ACCOUNT STRING DESCRIPTION
Increase available resources

NET ADJUSTMENT

ACCOUNT STRING DESCRIPTION
TOTAL
Establish revenue budget for projects

ACCOUNT STRING
TOTAL

DESCRIPTION
REQUIRED APPROVALS:

BUDGET DEPARTMENT USE ONLY:

This $1,099,308 Budget Adjustment is requested to recognize revenue for City Council-approved projects using federal American Rescue Plan Act (ARPA) funds.

TOTAL
6/1/20234:46 PM
1 ORDINANCE NO. 6678

ORDINANCE OF THE COUNCIL OF THE CITY OF ROSEVILLE
AUTHORIZING CERTAIN AMENDMENTS TO THE FISCAL YEAR 2022-23

BUDGET AND DECLARING THIS ORDINANCE TO BE IMMEDIATELY

EFFECTIVE AS AN APPROPRIATION MEASURE
THE CITY OF ROSEVILLE ORDAINS:

SECTION 1. The City of Roseville Annual Budget, Fiscal Year 2022-23, is hereby amended as listed on the attached budget adjustment for the Transit Fund/Transit Shuttle Fee Fund.

SECTION 2. This ordinance is hereby declared to be an appropriation measure, immediately effective pursuant to the provisions of Section 5.03 of the Charter.

PASSED AND ADOPTED by the Council of the City of Roseville, this ______________ day of _________________, 2023, by the following vote on roll call:

AYES COUNCILMEMBERS:

NOES COUNCILMEMBERS:

ABSENT COUNCILMEMBERS:
_______________________________
MAYOR
ATTEST:
__________________________
City Clerk

EXPENDITURES/EXPENSES/TRANSFERS OUT
BUDGET ($)
Fund Account Center Project Adjustment
6511 6801 10001 200,000
200,000

REVENUES/TRANSFERS IN
BUDGET ($)
Fund Account Center Project Adjustment
6512 4801 10001 200,000
200,000
-

FUND BALANCE
BUDGET ($)
Fund Account Center Project Adjustment
6511 (200,000)
6512 200,000
-
Justification for Budget Adjustment:

REQUESTING DEPARTMENT HEAD / DESIGNEE DATE BUDGET MANAGER / DESIGNEE DATE

CHIEF FINANCIAL OFFICER / DESIGNEE DATE CITY MANAGER / DESIGNEE DATE

POSTED BY DATE
Revised: June 24, 2019

ACCOUNT STRING DESCRIPTION
Increase in available resources
Transfer out of the Transit Fund into the Transit Shuttle Service Fee Fund

NET ADJUSTMENT

ACCOUNT STRING DESCRIPTION
TOTAL
Transfer out of the Transit Fund into the Transit Shuttle Service Fee Fund

ACCOUNT STRING
TOTAL

DESCRIPTION
REQUIRED APPROVALS:

BUDGET DEPARTMENT USE ONLY:

This $200,000 Budget Adjustment is requested to transfer revenues collected in the Transit Fund into the new Transit Shuttle Service Fee Fund. The Transit Shuttle Service Fee applies to the West Roseville Specific Plan and provides funding for a shuttle service between the West Roseville Specific Plan area and the I-80/Watt Avenue light rail station.

TOTAL
Decrease in available resources
6/1/20231:07 PM
1 ORDINANCE NO. 6679

ORDINANCE OF THE COUNCIL OF THE CITY OF ROSEVILLE
AUTHORIZING CERTAIN AMENDMENTS TO THE FISCAL YEAR 2022-23

BUDGET AND DECLARING THIS ORDINANCE TO BE IMMEDIATELY

EFFECTIVE AS AN APPROPRIATION MEASURE
THE CITY OF ROSEVILLE ORDAINS:

SECTION 1. The City of Roseville Annual Budget, Fiscal Year 2022-23, is hereby amended as listed on the attached budget adjustment for the General Fund Capital Reserve Fund/Strategic Improvement Fund.

SECTION 2. This ordinance is hereby declared to be an appropriation measure, immediately effective pursuant to the provisions of Section 5.03 of the Charter.

PASSED AND ADOPTED by the Council of the City of Roseville, this ______________ day of _________________, 2023, by the following vote on roll call:

AYES COUNCILMEMBERS:

NOES COUNCILMEMBERS:

ABSENT COUNCILMEMBERS:
_______________________________
MAYOR
ATTEST:
__________________________
City Clerk

EXPENDITURES/EXPENSES/TRANSFERS OUT
BUDGET ($)
Fund Account Center Project Adjustment
1012 6801 10001 4,000,000
4,000,000

REVENUES/TRANSFERS IN
BUDGET ($)
Fund Account Center Project Adjustment
1030 4801 10001 4,000,000
4,000,000
-

FUND BALANCE
BUDGET ($)
Fund Account Center Project Adjustment
1012 (4,000,000)
1030 4,000,000
-
Justification for Budget Adjustment:

REQUESTING DEPARTMENT HEAD / DESIGNEE DATE BUDGET MANAGER / DESIGNEE DATE

CHIEF FINANCIAL OFFICER / DESIGNEE DATE CITY MANAGER / DESIGNEE DATE

POSTED BY DATE
Revised: June 24, 2019

ACCOUNT STRING DESCRIPTION
Decrease available resources
Transfer out of the General Fund Capital Reserve Fund
into the Strategic Improvement Fund

NET ADJUSTMENT

ACCOUNT STRING DESCRIPTION
TOTAL
Transfer out of the General Fund Capital Reserve Fund
into the Strategic Improvement Fund

ACCOUNT STRING
TOTAL

DESCRIPTION
REQUIRED APPROVALS:

BUDGET DEPARTMENT USE ONLY:

This request transfers $4 million from the General Fund Capital Reserve Fund to the Strategic Improvement Fund to pay for part of the Westbrook Boulevard - Segment 4 project (500413). In May 2023, the City Council approved funding this project with $4 million from the Strategic Improvement Fund. After City Council approval, staff determined that adequate funds for this project were available in the General Fund Capital Reserve Fund.

This $4 million is fully reimbursable.

TOTAL
Increase available resources
6/2/202310:21 AM
1 ORDINANCE NO. 6680

ORDINANCE OF THE COUNCIL OF THE CITY OF ROSEVILLE
AUTHORIZING CERTAIN AMENDMENTS TO THE FISCAL YEAR 2022-23

BUDGET AND DECLARING THIS ORDINANCE TO BE IMMEDIATELY

EFFECTIVE AS AN APPROPRIATION MEASURE
THE CITY OF ROSEVILLE ORDAINS:

SECTION 1. The City of Roseville Annual Budget, Fiscal Year 2022-23, is hereby amended as listed on the attached budget adjustment for emergency repairs at the Placer County Society for the Prevention of Cruelty to Animals facility.

SECTION 2. This ordinance is hereby declared to be an appropriation measure, immediately effective pursuant to the provisions of Section 5.03 of the Charter.

PASSED AND ADOPTED by the Council of the City of Roseville, this ______________ day of _________________, 2023, by the following vote on roll call:

AYES COUNCILMEMBERS:

NOES COUNCILMEMBERS:

ABSENT COUNCILMEMBERS:
_______________________________
MAYOR
ATTEST:
__________________________
City Clerk

ORDINANCE NO. 6681

ORDINANCE OF THE COUNCIL OF THE CITY OF ROSEVILLE
AUTHORIZING CERTAIN AMENDMENTS TO THE FISCAL YEAR 2022-23

BUDGET AND DECLARING THIS ORDINANCE TO BE IMMEDIATELY

EFFECTIVE AS AN APPROPRIATION MEASURE
THE CITY OF ROSEVILLE ORDAINS:

SECTION 1. The City of Roseville Annual Budget, Fiscal Year 2022-23, is hereby amended as listed on the attached budget adjustment for closure of the General Capital Projects Fund.

SECTION 2. This ordinance is hereby declared to be an appropriation measure, immediately effective pursuant to the provisions of Section 5.03 of the Charter.

PASSED AND ADOPTED by the Council of the City of Roseville, this ______________ day of _________________, 2023, by the following vote on roll call:

AYES COUNCILMEMBERS:

NOES COUNCILMEMBERS:

ABSENT COUNCILMEMBERS:
_______________________________
MAYOR
ATTEST:
__________________________
City Clerk

REQUEST FOR BUDGET ADJUSTMENT
REQUESTER NAME & TITLE: Nancy Rothlisberger, Budget Manager FISCAL YEAR: 2022-23 PREPARER NAME & TITLE: Natalya Lakhno, Budget Analyst COUNCIL DATE (if applicable): 6/21/23 DEPARTMENT/DIVISION: Finance ORDINANCE:

EXPENDITURES/EXPENSES/TRANSFERS OUT
BUDGET ($)
Fund Account Center Project Adjustment
-

REVENUES/TRANSFERS IN
BUDGET ($)
Fund Account Center Project Adjustment
-
-

FUND BALANCE
BUDGET ($)
Fund Account Center Project Adjustment
-
Justification for Budget Adjustment:

REQUESTING DEPARTMENT HEAD / DESIGNEE DATE BUDGET MANAGER / DESIGNEE DATE

CHIEF FINANCIAL OFFICER / DESIGNEE DATE CITY MANAGER / DESIGNEE DATE

POSTED BY DATE
Revised: June 24, 2019

ACCOUNT STRING

DESCRIPTION
See attached
TOTAL

ACCOUNT STRING

DESCRIPTION
See attached
TOTAL

NET ADJUSTMENT

ACCOUNT STRING

DESCRIPTION
See attached
BUDGET DEPARTMENT USE ONLY:

TOTAL
This Budget Adjustment is requested to close the General Capital Project (GCP) Fund. Available GCP Fund balances ($96,336) in the City Facilities Security Improvements (400013) Capital Improvement Project (CIP) will be moved to the General Fund and reappropriated in an equivalent amount within the CIP. The 800 Mhz Radio System Replacement CIP (400091) has a remaining balance of $244,974 in the GCP Fund. This budget adjustment will reduce this project budget by $244,974 and prepare the 800 Mhz Radio System Replacement CIP for closure. $240,403 of this funding will be moved to the IT Replacement Fund and reappropriated in the East Radio Site (400126), and $4,571 will be moved to the FY2020-21 Security Upgrades Project (500121). Available GCP Fund balances of $46,165 in the Saugstad Park Renovations CIP (400122) and $17,811 in the Childrens Art Center CIP (400132) will be moved to the Facility Rehabilitation Fund and reappropriated in the same amount within these CIPs. The remaining available balance of $7,249 in the GCP Fund will be split between the IT Replacement Fund and the Facility Rehabilitation Fund.

REQUIRED APPROVALS:

Page 1 of 2 ends

EXPENDITURES/EXPENSES/TRANSFERS OUT
BUDGET ($)
Fund Account Center Project Adjustment
3110 6587 84001 400013 (96,336)
3110 6801 10001 96,336
1001 6587 84001 400013 96,336
3110 6587 84001 400091 (244,974)
3110 5433 84001 500121 4,571
3110 5540 32101 240,403
4105 6587 84001 400126 240,403
3110 6587 84001 400122 (46,165)
3110 5528 58130 46,165
4065 6587 84001 400122 46,165
3110 6587 84001 400132 (17,811)
3110 5528 58130 17,811
4065 6587 84001 400132 17,811
3110 6801 10001 7,249
407,964

REVENUES/TRANSFERS IN
BUDGET ($)
Fund Account Center Project Adjustment
1001 4801 10001 96,336
4105 4251 32101 240,403
4065 4251 58130 46,165
4065 4251 58130 17,811
4105 4801 10001 3,625
4065 4801 10001 3,624
407,964
-

FUND BALANCE
BUDGET ($)
Fund Account Center Project Adjustment
3110 (7,249)
4105 3,625
4065 3,624

TOTAL -
TOTAL

NET ADJUSTMENT

ACCOUNT STRING

DESCRIPTION
Decrease in available resources
Increase in available resources
Increase in available resources

ACCOUNT STRING

DESCRIPTION
Transfer funds from Fund 3110 to Fund 1001-
project 400013

ACCOUNT STRING

DESCRIPTION
Reduce project budget-400013 City Facilities
Security Improvements
Increase project budget for Fund 4065-project
400132
TOTAL
Transfer funds from Fund 3110 - General Capital
Projects to Fund 1001 General Fund project
400013
Increase project budget for Fund 1001 project
400013
Reduce project budget-400091 800 Mhz Radio
System Replacement
Increase project budget-500121 FY2020-21
Security Upgrades
Transfer funds from Fund 3110 to Fund 4105-IT
Replacement Fund - project 400126
Increase project budget for Fund 4105-project
400126 East Radio Site Relocation
Reduce project budget-400122 Saugstad Park
Renovations
Transfer funds from Fund 3110 to Fund 4065-
Facility Rehab Fund project 400122
Increase project budget for Fund 4065-project
400122
Reduce project budget-400132 Childrens Art
Center
Transfer funds from Fund 3110 to Fund 4065-
project 400132
Transfer funds from Fund 3110 to Fund 4105-
project 400091
Transfer funds from Fund 3110 to Fund 4065-
project 400122
Transfer funds from Fund 3110 to Fund 4065
Transfer funds from Fund 3110 to Fund 4065-
project 400132
Transfer remaining funds from Fund 3110 to Fund
4105 and Fund 4065
Transfer funds from Fund 3110 to Fund 4105

Page 2 of 2 ends

ORDINANCE NO. 6682

ORDINANCE OF THE COUNCIL OF THE CITY OF ROSEVILLE
AUTHORIZING CERTAIN AMENDMENTS TO THE FISCAL YEAR 2022-23

BUDGET AND DECLARING THIS ORDINANCE TO BE IMMEDIATELY

EFFECTIVE AS AN APPROPRIATION MEASURE
THE CITY OF ROSEVILLE ORDAINS:

SECTION 1. The City of Roseville Annual Budget, Fiscal Year 2022-23, is hereby amended as listed on the attached budget adjustment for the Facility Rehabilitation Fund.

SECTION 2. This ordinance is hereby declared to be an appropriation measure, immediately effective pursuant to the provisions of Section 5.03 of the Charter.

PASSED AND ADOPTED by the Council of the City of Roseville, this ______________ day of _________________, 2023, by the following vote on roll call:

AYES COUNCILMEMBERS:

NOES COUNCILMEMBERS:

ABSENT COUNCILMEMBERS:
_______________________________
MAYOR
ATTEST:
__________________________
City Clerk

ORDINANCE NO. 6683

ORDINANCE OF THE COUNCIL OF THE CITY OF ROSEVILLE
AUTHORIZING CERTAIN AMENDMENTS TO THE FISCAL YEAR 2022-23

BUDGET AND DECLARING THIS ORDINANCE TO BE IMMEDIATELY

EFFECTIVE AS AN APPROPRIATION MEASURE
THE CITY OF ROSEVILLE ORDAINS:

SECTION 1. The City of Roseville Annual Budget, Fiscal Year 2022-23, is hereby amended as listed on the attached budget adjustment for the Workers Compensation Fund.

SECTION 2. This ordinance is hereby declared to be an appropriation measure, immediately effective pursuant to the provisions of Section 5.03 of the Charter.

PASSED AND ADOPTED by the Council of the City of Roseville, this ______________ day of _________________, 2023, by the following vote on roll call:

AYES COUNCILMEMBERS:

NOES COUNCILMEMBERS:

ABSENT COUNCILMEMBERS:
_______________________________
MAYOR
ATTEST:
__________________________
City Clerk

REQUEST FOR BUDGET ADJUSTMENT
REQUESTER NAME & TITLE: Virginia Bolman, Risk Manager FISCAL YEAR: 2022-23 PREPARER NAME & TITLE: Natalya Lakhno, Budget Analyst COUNCIL DATE (if applicable): 6/21/23 DEPARTMENT/DIVISION: Human Resources ORDINANCE:

EXPENDITURES/EXPENSES/TRANSFERS OUT
BUDGET ($)
Fund Account Center Project Adjustment
4211 5503 28010 550,000
550,000

REVENUES/TRANSFERS IN
BUDGET ($)
Fund Account Center Project Adjustment
-
550,000

FUND BALANCE
BUDGET ($)
Fund Account Center Project Adjustment
4211 (550,000)
(550,000)
Justification for Budget Adjustment:

REQUESTING DEPARTMENT HEAD / DESIGNEE DATE BUDGET MANAGER / DESIGNEE DATE

CHIEF FINANCIAL OFFICER / DESIGNEE DATE CITY MANAGER / DESIGNEE DATE

POSTED BY DATE
Revised: June 24, 2019
TOTAL
TOTAL

ACCOUNT STRING DESCRIPTION
Increase expenditure budget for WC claims
Decrease in available resources

NET ADJUSTMENT

ACCOUNT STRING DESCRIPTION
REQUIRED APPROVALS:

BUDGET DEPARTMENT USE ONLY:

This $550,000 Budget Adjustment is requested to fund higher than anticipated workers compensation claims in FY2023.

DESCRIPTION
TOTAL

ACCOUNT STRING
6/1/20234:37 PM
1 6.1.23

COUNCIL COMMUNICATION
CC #: 2798
File #: 0709-02-01
Title: HOUSING AUTHORITY/CITY COUNCIL - Quarterly Status Update Contact: Suzi Cook-Turner 916-774-5414 [email protected] Trisha Isom 916-746-1239 [email protected]
Meeting Date: 6/21/2023
Item #: 7.28.

RECOMMENDATION TO COUNCIL
The City Council, acting as the Roseville Housing Authority Board, is not required to take any action on this item. This quarterly report is for informational purposes only.

BACKGROUND
Pursuant to the bylaws of the Roseville Housing Authority (RHA), the City Council, acting as the governing board for the Housing Authority, holds its quarterly meeting the first Wednesday of March, June, September, and December, or as soon as possible thereafter. Staff has prepared the following status report regarding lease-up activity for the Housing Choice Voucher (HCV) Program. The HCV Program provides income-qualified households in Roseville and Rocklin with rental assistance using funding from the US Department of Housing and Urban Development (HUD). This assistance is utilized at rental units that meet program specific housing standards, are owned by a willing property owner, and are within Roseville or Rocklin city limits. This rental assistance ensures that the household can afford to live in safe and decent housing. During the first quarter of 2023 there were 628 vouchers utilized in Roseville, 109 vouchers being utilized in Rocklin, and 2 in other jurisdictions (approved transfers out of the area) for a total of 739 families receiving rental assistance through RHA.

RHA is authorized to provide 823 households with HCV rental assistance. RHA also has several special voucher programs including 50 Emergency Housing Vouchers (EHV) providing rental assistance to individuals and families who are experiencing homelessness or at risk of experiencing homelessness; 75 vouchers allocated specifically for families on the waiting list with a head-of-household or partner that are non-elderly and disabled (NED vouchers) and 43 Mainstream vouchers assist households who have a non-elderly head of household or partner with a disability and are transitioning out of institutional or other segregated settings, are currently homeless, or at risk of becoming homeless.

In its efforts to expand affordable housing opportunities, Roseville Housing Authority continues to apply for additional vouchers and administrative fees when award or NOFA applications are made available from HUD to Public Housing Authorities (PHAs). RHA applied for additional Veterans Affairs Supportive Housing (VASH) vouchers and was awarded 10 additional vouchers in February 2023 which brings our total to 85 vouchers for veteran households that come via referral from the Veterans Affairs (VA) Department. Veterans receive case management from HUD VASH caseworkers which assist them with managing day to day life challenges, paperwork, and housing search. Close collaboration and communication with the VA and RHA has reduced the time in determining eligibility which allows veterans to receive a voucher quickly and begin the process of finding a suitable unit.

In March 2023 senior staff attended a funding meeting with the Continuum of Care (CoC) where RHA was awarded $100,000 to assist in landlord recruitment efforts. Advocates for Mentally Ill Housing (AMIH) and RHA collaborated during the meeting to offer an additional $50,000 in landlord incentives. Current HUD funding does not allow for any incentives. These new funds allowed RHA to create a Landlord Incentive Program and began offering an incentive of $1,000 for each new contract with a voucher holder to assist with recruitment of new landlords to the HCV program.

RHA administers the Family Self-Sufficiency Program (FSS) which is a component of the HCV program that provides additional assistance to families who are working to become free of public assistance. RHA is collaborating with Placer County Housing Authority (PCHA) in running our FSS programs and our shared Program Coordinating Committee (PCC) is made up of Placer County agencies and businesses to assist the housing authorities in securing commitments of public and private resources for operation of the FSS program. The first quarter meeting of the PCC was exciting and productive with PCHA, Placer County, and RHA establishing an interagency referral process.

During the first quarter of 2023, housing authority staff attended the HUD sponsored National Standards for the Physical Inspection of Real Estate (NSPIRE) training in Oakland. The Housing Quality Standards (HQS) inspections will be replaced by NSPIRE. The new model prioritizes health, safety and functional defects over appearance and implements inspections that better reflect the true physical conditions of the property with increased inspection consistency. HUD has given a deadline of October 2023 for Public Housing Authorities (PHAs) operating HCV programs to adopt the NSPIRE model. In February and March 2023 RHA, along with Housing Division staff, took part in two community volunteer opportunities. Staff filled food boxes with the Placer County Food Bank and distributed fresh produce and food to elderly and disabled residents of the Maidu Village Apartment complexes.

Each housing authority is required to be at least 95% leased-up for its voucher allocation or utilizing at least 95% of its annual budget authority to remain in compliance with HUD’s requirements. The lease-up rate for a calendar year cannot exceed 100% of its allocation of vouchers (per voucher type), and/or 100% expenditure of its annual budget allocation for the program. Agencies leasing up or expending 98% or more of its allocated vouchers and/or budget can reach high-performing status. RHA continues to meet HUD program requirements for highperforming status through 100% expenditure of its annual budget allocation. The attached table provides a monthly summary of RHA’s voucher programs for the first quarter of 2023.

FISCAL IMPACT
This Housing Authority Quarterly Status Report does not create any additional cost to the City’s General Fund.

ENVIRONMENTAL REVIEW
The California Environmental Quality Act (CEQA) does not apply to activities that will not result in a direct or reasonably foreseeable indirect physical change in the environment or is otherwise not considered a project as defined by CEQA Statute §21065 and CEQA State Guidelines §15060(c)(3) and §15378. The Roseville Housing Authority Quarterly Report meets the above criteria and is not subject to CEQA. No additional environmental review is required.

CITY COUNCIL STRATEGIC PLAN/OVERARCHING GOALS
Goal C - Maintain a safe and healthy community
Goal D - Enhance economic vitality
Respectfully Submitted,
Suzi Cook-Turner, Housing Supervisor
Melissa Anguiano, Economic Development Director
_____________________________
Dominick Casey, City Manager
ATTACHMENTS:

Description
RHA 1st Quarter 2023
Roseville Housing Authority Voucher Lease-up 1st Quarter 2023 Actual Leaseup of
Mainstream
12-HUD
Mainstream
(43)
Jan-23 528 570 75 75 59 75 35 43 35 50
Feb-23 526 570 75 75 59 85 34 43 35 50
Mar-23 532 570 74 75 58 85 33 43 35 50
YTD Total 1586 1710 224 225 176 245 102 129 105 150
YED % Leased
Actual
Lease-up
of VASH
11-HUD
VASH (85)
Actual Leaseup of EHV
21-HUD
Emergency
Housing
Vouchers
(EHVs) (50)
2023
Actual
Lease-up
of Regular
10-HUD
Regular
(570)
Actual
Lease-up
of NonElderly
Disabled
5-HUD NonElderly
Disabled
(75)

92.7% 99.6% 71.8% 79.1% 70.0%

COUNCIL COMMUNICATION
CC #: 2783
File #: 0201
Title: Fiscal Year 2022-23 Second Quarter Financial Report Contact: Scott Pettingell 916-774-1306 [email protected] Meeting Date: 6/21/2023
Item #: 7.29.

RECOMMENDATION TO COUNCIL
This is an informational item and requires no City Council action.

BACKGROUND
The attached second quarter financial report provides a summary of the City’s financial position through the second quarter of FY2022-23 for (1) the General Fund, (2) the enterprise operating funds, and (3) revenues in other selected funds. This report is provided pursuant to the Budget Control section of the City Charter (Section 7.15).

FISCAL IMPACT
This item is a financial update only and has no fiscal impact.

ENVIRONMENTAL REVIEW
The California Environmental Quality Act (CEQA) does not apply to activities that will not result in a direct or reasonably foreseeable indirect physical change in the environment, or is otherwise not considered a project as defined by CEQA Statute §20165 and CEQA State Guidelines §15060(c)(3) and §15378. This second quarter financial report meets the above criteria and is not subject to CEQA. No additional environmental review is required.

CITY COUNCIL STRATEGIC PLAN/OVERARCHING GOALS
Goal A - Remain fiscally responsible in a changing world Respectfully Submitted,
Scott Pettingell, Assistant Finance Director
Dennis Kauffman, Assistant City Manager/Chief Financial Officer _____________________________
Dominick Casey, City Manager
ATTACHMENTS:

Description
FY2022-23 Second Quarter Financial Report
Fiscal Year 2022-23
Second Quarter Report
Overview
This financial report provides an overview of the City’s financial position through the second quarter of the fiscal year (FY) 2022-23 (July 1, 2022, through December 31, 2022) for:
(1) the General Fund.
(2) the major enterprise operating funds, and
(3) revenues in other selected funds.

Considerations
General Fund revenues through the second quarter of FY2022-23 are trending to end the year modestly above estimates. Sales tax (Bradley Burns and Measure B) revenue growth has slowed compared to prior years and the combined revenue is forecasted to end the year slightly under budget by $1.5 million. Based on the most recent estimates from the County Assessor and Auditor-Controller, property tax revenues are forecast to end the year above the budget estimate by $1.7 million. With the passage of Measure C in November 2022, the City’s transient occupancy tax (TOT), also known as hotel tax, is forecasted to exceed the budget estimate by approximately $1.6 million. Building permits, plan check fees, and engineering inspection fees will end the year above the budget target, and recreation program revenues have returned to pre-pandemic levels.

General Fund operating revenues collected through the second quarter are 25 percent of the budget. This collection rate is expected and is in line with prior years due to the timing associated with receiving some of the more significant tax revenue sources. The table and graph included in this report show cumulative General Fund operating revenue through the second quarter and a revenue budget to actual comparison. Following the table and graph are additional details on each of the City’s major revenue streams.

The following factors should be taken into consideration when analyzing this information:

Sales and Use Tax is the largest General Fund revenue source. The City only receives four months of sales tax revenues by the end of the second quarter of each fiscal year due to the California Department of Tax and Fee Administration (CDTFA) processing timelines. Second quarter revenues are derived from taxable sales through October 2022, received in December.

Property Tax is the second largest General Fund revenue source, but most of this tax is received from the County Assessor and Auditor-Controller in the third (mid-January) and fourth (mid-May) quarters. This distribution schedule is why property tax revenue is tracking low at 2 percent in the following table and graph.

Second Quarter Report
Fiscal Year 2022-23
1 Transient Occupancy Tax (TOT) (also known as hotel tax) is derived from payments received by the City through December for hotel stays through November; therefore, the following charts only reflect five months of TOT revenues collected before the Measure C increase was effective.

Budget to Cumulative Revenue Comparison

Budget to Cumulative Revenue Comparison
(July 1 – December 31)
Revenue Type

Amended
Budget
Cumulative
Revenues
Balance
Remaining
% of
Budget
Collected
Sales and Use Tax - Bradley Burns $ 74,091,000 $ 23,479,562 $ (50,611,438) 32% Sales and Use Tax - Measure B 28,100,000 9,840,473 (18,259,527) 35% Sales and Use Tax - State Aid for Public Safety 1,622,000 726,652 (895,348) 45% Property Tax 64,429,000 1,112,727 (63,316,273) 2%
Transient Occupancy Tax (TOT) 4,000,000 1,831,183 (2,168,817) 46% Parks, Recreation & Library Programs 4,188,040 2,129,237 (2,058,803) 51% Building Permits 2,920,836 1,614,095 (1,306,741) 55%
Plan Check Fees 2,537,000 2,122,583 (414,417) 84%
Engineering Inspection Fees 353,196 243,165 (110,031) 69% Grants - 33,590 33,590 0%
Other Revenues 14,316,957 5,136,982 (9,179,975) 36%
Total

$196,558,029 $ 48,270,249 $(148,287,780) 25%
32%
35%
45%
2%
46%
51%
55%
84%
69%
0%
36%
25%
0% 20% 40% 60% 80% 100%
Sales and Use Tax - Bradley Burns
Sales and Use Tax - Measure B
Sales and Use Tax - Public Safety
Property Tax
Transient Occupancy Tax (TOT)
Parks, Recreation & Library
Building Permits
Plan Check Fees
Engineering Inspection Fees
Grants
Other Revenues
Total
General Fund Operating Revenues
Cumulative Percentage of Revenue Collected
(July 1 – December 31)
Amended
Budget
2 Bradley Burns and Measure B Sales Tax
The City's Bradley Burns and Measure B sales and use tax revenues collected through the second quarter are 32 percent and 35 percent of the budget estimates, respectively. Sales tax revenue received through the second quarter is derived from taxable sales through October 2022.

To date, the City has received Bradley Burns and Measure B sales tax distributions from taxable sales through March. These amounts total $52,724,607 in Bradley Burns sales tax and $21,785,847 in Measure B sales tax.

Fortunately, when developing the FY2022-23 budget, staff estimated that sales and use tax would end the year between the City sales tax consultant's conservative and most-likely estimates. The latest sales tax data indicate more slowing in sales and use tax growth than anticipated, which has resulted in our consultant shifting their estimates lower. The slower growth is related to a change in consumer behavior from taxable goods to other areas that were constrained during the pandemic such as services and travel as well as uncertainties around inflation, interest rates, and the potential for a slowdown or recession in 2023. The consultant’s adjustment in the forecast indicates that Bradley Burns may end the year under the budget estimate by $2.9 million, and Measure B may end the year above the estimate by $1.4 million, for a projected net shortfall in sales tax revenue of just under $1.5 million. The following charts show the consultant's latest conservative, most likely, and optimistic scenarios and a budget versus forecast comparison.

Updated Consultant Forecast Conservative Most-Likely Optimistic Sales and Use Tax - Bradley Burns $ 65,957,800 $ 71,228,752 $ 76,499,700 Sales and Use Tax - Measure B 26,824,100 29,477,064 32,130,000 Total $ 92,781,900 $ 100,705,816 $ 108,629,700
Budget Versus Updated Forecast Budget Most-Likely Variance Sales and Use Tax - Bradley Burns $ 74,091,000 $ 71,228,752 $ (2,862,248) Sales and Use Tax - Measure B 28,100,000 29,477,064 1,377,064 Total $ 102,191,000 $ 100,705,816 $ (1,485,184)
3 The graphs below show Bradley Burns and Measure B Sales and Use Tax revenues through the month of March as compared to budget and the updated year-end projection.

Additional Sales Tax Information: The City's sales tax consultant has prepared a Quarterly Report on Sales Tax and Business Activity. The report provides a list of the top 25 sales tax remitters, a summary of cash receipts, and sales tax data by economic category. A copy of the report is attached.

Secured, Unsecured, and Supplemental Property Tax
Property tax revenue for FY2022-23 is based on the assessed valuation as of January 1, 2022. The City receives most of this funding in the third and fourth quarters of the fiscal year. As of April 2023, the City has received $36.7 million. Based on the information provided by the County Assessor and Auditor-Controller, and the City's property tax consultant, staff anticipates property tax collections of $66 million, exceeding budget estimates by approximately $1.7 million.
$74.1
$52.7
$71.2
$0
$10
$20
$30
$40
$50
$60
$70
$80
Budget Actuals Year-end
Projection Millions
Bradley Burns Sales & Use Tax Revenues
Most-Likely
$76.5 Optimistic
$65.9 Conservative
$28.1
$21.8
$29.5
$0
$5
$10
$15
$20
$25
$30
$35
Budget Actuals Year-end
Projection Millions
Measure B Sales & Use Tax
Most-Likely
$32.1 Optimistic
$26.8 Conservative
$64.4
$36.7
$66.1
$0
$10
$20
$30
$40
$50
$60
$70
Budget Actuals Year-end
Projection Millions
Property Tax Revenues
4 Transient Occupancy Tax (TOT)
Through the end of the second quarter, TOT revenues are at 46 percent of estimates ($1.8 million for the months of July through November). TOT collected through March 2023 totals $3.6 million, tracking 15 percent higher than budget estimates for the first nine months of the fiscal year. On November 8, 2022, Roseville voters approved Measure C to increase the City’s TOT rate from 6 percent to 10 percent. The 10 percent tax rate went into effect on January 1, 2023. Based on the final TOT revenue of nearly $4.5 million in FY2021-22, the higher rate would have generated an additional $2.9 million of tax revenue for the General Fund last year.

Accounting for Measure C, and assuming current trends continue, staff project that the City will end the year at $5.6 million (approximately $1.6 million above estimates). The following graph shows monthly TOT revenues and projected results for FY2022-23 compared to hotel tax revenue received in FY2021-22.

Parks, Recreation & Library (PR&L) Programs
Parks, Recreation & Libraries (PRL) program revenues are slightly above 50 percent for the second quarter at 51 percent, as a result of PRL revenues fluctuating throughout the year due to the seasonality of programming.

Based on the current results, staff anticipates PRL is on track to meet its FY2022-23 revenue goals.

Building Permits, Plan Check Fees, Engineering Inspection Fees Building permit, plan check, and engineering inspection fees are trending higher than budget during the second quarter due to sustained increases in the City's development activity. Staff anticipates that overall revenues will remain higher than budgeted through the end of the fiscal year. -
200
400
600
800
1,000
July August September October November December January February March April May June Thousands Monthly Hotel Revenue Forecast
and 2-Year Comparison
FY2022-23 FY2021-22
$4.0
$3.6
$5.6
$0.0
$1.0
$2.0
$3.0
$4.0
$5.0
$6.0
Budget Actuals Year-end
Projection Millions
Transient Occupancy Tax (TOT)
5 Other Revenues
Other revenues include reimbursements from the State, development reimbursement activity, property transfer tax, business license tax, rental payments, animal licensing, passport processing, permit, franchise, and other fees. As of the end of the second quarter, revenues in this category are tracking lower than target at 36 percent of budget estimates due to seasonality and timing of revenue collection. Revenues under this category are expected to be on budget by the end of the fiscal year.

General Fund: Operating Expenditures

Budget to Cumulative Expenditure Comparison
(July 1 – December 31)
Department
Amended
Budget
Cumulative
Expenditures
Balance
Remaining
% of
Budget
Expended
Police $ 55,485,587 $ 24,776,448 $ 30,709,139 45%
Fire 42,278,347 18,275,437 24,002,910 43%
Parks, Recreation & Libraries 31,549,551 14,564,237 16,985,314 46% General Government(1) 12,081,446 4,800,581 7,280,865 40% Development Services 11,291,582 4,603,846 6,687,736 41% Public Works 10,301,065 3,955,060 6,346,005 38%
Economic Development & Housing 1,158,171 643,465 514,706 56% Total $ 164,145,749 $ 71,619,074 $ 92,526,675 44%
(1) General Government includes the following departments: City Council, City Manager’s Office, City Attorney’s Office, City Clerk, Finance, Public Affairs and Communications, and Human Resources. 45%
43%
46%
40%
41%
38%
56%
44%
0% 20% 40% 60% 80% 100%
Police
Fire
PRL
General Government
Development Services
Public Works
Economic Development
Total
General Fund Department Operating Expenditures
Percentage of Budget Expended
(July 1 – December 31)
6 General Fund expenditures are tracking below target compared to the budget at 44 percent through the first six months of the fiscal year. The slightly lower spending rate (44 percent versus 50 percent of the year elapsed) is primarily due to cost savings from vacant positions in Police; Fire; Parks, Recreation and Libraries; Development Services; Public Works; and other General Fund departments, and reduced spending levels for the first part of the fiscal year due to the timing of expenditures and supply chain delays.

The expenditure budget consumption for the Police and Fire Departments is below target at 45 percent and 43 percent, respectively. The Police Department experienced a high number of vacancies during the first quarter of the year. Due to the lengthy background check process for officers, the majority of vacant positions were not filled until after the second quarter. Fire expenditures are tracking lower than budget due to vacancies, timing of expenditures, and supply chain delays. The department expects to spend most of its expenditure budget by the end of the fiscal year.

Parks, Recreation, and Libraries Department (PRL) expenditures are at 46 percent of the budget through the second quarter primarily due to temporary and full-time position vacancies.

The lower than budget expenditure trend (41 percent of budget consumption) for Development Services is related to vacancies in the Building Inspection, Engineering, and Code Enforcement Divisions. Likewise, the Public Works department experienced salary savings due to vacancies through the end of the second quarter.

The Economic Development Department is tracking at 56 percent of the budget through the second quarter primarily due to membership and lease payments paid at the beginning of the fiscal year, and the timing associated with processing reimbursements for labor costs in the Housing Division. The Housing Division is budgeted in the General Fund and reimbursed from several housing-related funds (i.e., Housing Authority Housing Choice Voucher and Community Development Block Grant). Staff will process the necessary reimbursements to fully reimburse the General Fund by the end of the fiscal year.

Enterprise Funds: Operating Revenues and Expenditures
Revenues
Operating revenues in the Electric
Fund through the second quarter
are tracking slightly higher than
budget due to increased retail
sales attributable to stronger than
expected customer usage during
warmer than average
temperatures. Waste Services
revenues are slightly over budget target through the second quarter due to increased residential consumption and 7 new development. Wastewater revenues are tracking low at 45 percent due to the timing of expense reimbursements from regional partners expected to be collected during the third and fourth quarters.

The larger budget to actual variances in the Transit and Transportation enterprise funds are due to the timing associated with their primary funding streams. The majority of their revenue is realized in the last two quarters of the fiscal year. Transit operating revenue losses in passenger fares due to low ridership persist during FY2022-

23. Transit operations will continue to receive support from the Coronavirus Response and Relief Supplemental Appropriations Act of 2021 during the fiscal year to offset revenue losses.

Revenues in the Youth Development fund are at 51 percent of the budget through the second quarter of the fiscal year. The $4.9 million cumulative revenues include a $1.8 million subsidy from the City’s allocation of American Rescue Plan Act (ARPA) funding. Without the subsidy, revenues in the Youth Development fund would be tracking at 32 percent of budget. Enrollment trends continue to improve; however, staff estimates that revenues will end the year below the budget target.

Expenditures
Operating expenditures for the
Electric fund are under budget
through the second quarter,
primarily due to the timing of
expenditures and lower power
supply costs derived from a
substantial increase in
hydroelectric energy from the
Calaveras and South Feather projects. Environmental Utilities expenditures are tracking lower than budget due to vacancies and savings in professional services, training, and travel.

Transit and Transportation expenditures are lower than anticipated due to the timing of contracted services and vehicle purchases being delayed through the end of the year. Staff anticipates ending the year slightly under budget.

Expenses for the Youth Development Fund are at 37 percent through the second quarter of the fiscal year. While enrollment trends are still recovering, PRL staff continues to take measures to reduce operational costs to offset any revenue shortfall.
8 Other Revenue
The table presented shows
revenues in the Fire Facilities,
Public Facilities, and Strategic
Improvement Funds (SIF)
through the second quarter of
FY2021-22 and FY2022-23. The revenue estimates for these three funds are generally based on a multi-year trend analysis of forecasted single-family, multi-family, commercial development, and prior-year revenue collections. Revenues for the Fire Facilities and Strategic Improvement Funds ended the second quarter under revenue estimates at 40 percent and 38 percent, respectively. Staff anticipates that revenues in these funds will end the year on or above the budget target, due to the increase in development activity during the spring and summer months. The SIF cumulative revenue is significantly lower than the FY2021-22 actuals because the prior year’s actuals included a $2.5 million transfer from the Environmental Utilities Department for 243.4 acres of vacant land for future operational requirements.
9 Top 25 Sales Tax Remitters California sales tax cash receipts increased by 3.1% from the same quarter last year. In this jurisdiction sales tax cash ARCO AM/PM MINI MARTS receipts decreased by 7.3% from the same quarter last year AUTONATION CHRYSLER DODGE JEEP RAM ROSEVILLE due to a decrease of $136,398,000 in Taxable Sales.

AUTONATION HONDA
BMW OF ROSEVILLE Cash Receipts Quarter Annual
CARMAX AUTO SUPERSTORES Roseville -7.3% 2.0%
CHEVRON SERVICE STATIONS Placer Countywide Pool -9.6% 1.0% COSTCO WHOLESALE Placer Countywide -3.1% 3.4%
FUTURE FORD Sacramento Valley Region 0.1% 5.4%
FUTURE NISSAN Statewide 3.1% 8.1%

GMC RELIABLE
HOME DEPOT Annualized Percent Change in Sales Tax Cash Receipts

JOHN L SULLIVAN CHEVROLET

LEXUS OF ROSEVILLE

MACY'S DEPARTMENT STORE

MCKESSON MEDICAL -SURGICAL

NIELLO ACURA

NORDSTROM DEPARTMENT STORE

ROSEVILLE HYUNDAI

ROSEVILLE KIA

ROSEVILLE TOYOTA & SCION

SAFEWAY SERVICE STATIONS

SAM'S CLUB

TARGET STORES

VANDERBEEK MOTORS

WAL MART STORES
Business Activity Quarter Annual Quarter Annual
General Retail 0.5% 7.8% -11.9% -4.0%
Food Products 10.0% 11.8% -10.7% 2.1%
Transportation -12.7% -1.3% -7.7% 3.1%
Construction 3.6% 6.6% -13.2% -3.2%
Business To Business 6.3% 7.3% -12.6% -0.4%
TOTAL LOCAL BUSINESS ACTIVITY -2.0% 4.7% -10.9% -0.5%
COUNTYWIDE POOL ACTIVITY -13.5% -0.5% -4.8% 4.3%
City of Roseville
Roseville California
Quarterly Report on Sales Tax and Business Activity
4th Quarter 2022 in Review
-12.0%
-6.0%

0.0%

6.0%

12.0%

18.0%

24.0%

30.0%
Roseville Placer Countywide Statewide
Placer Countywide Pool -9.6% 1.0%
10 Roseville
Annual Per Capita Sales Tax
Adjusted for Inflation
(Constant 2018 $)
City of Roseville
News
Economic Activity: Real Gross Domestic Product (GDP) increased at an annual rate of 2.7% in the fourth quarter of 2022. U.S. inflation decelerated slightly to 7.1% in November of 2022, while California's headline inflation was 5.9% year over year as of November of 2022. headline inflation improved 160 basis points from last quarter's annual inflation rate of 7.5%. (DIR, BEA, BLS, December Finance Bulletin) Employment: The U.S. unemployment rate remained unchanged at 3.7% from October 2022 to November of 2022. California's unemployment rate increased slightly to 4.1% in November of 2022, 0.1 percentage point higher than October of 2022 rate of 4.0%. (BLS, December Finance Bulletin) Personal Income: U.S. personal income increased by 5.6% for the fourth quarter of 2022, compared to same quarter previous year. Personal consumption and expenditures increased by 7.5% , resulting in a 43.5% decrease in US personal savings for the fourth quarter of 2022, compared to same quarter previous year. (BEA)
2018Q4 $391 2019Q4 $389 2020Q4 $358 2021Q4 $422 2022Q4 $406 $45 $52 $68 $74 $68 $2 $2
$2 $2 $2 $37 $45 $33 $36 $36 $21
$20 $21 $23 $23
$125 $117 $112
$134 $123
$46 $45 $38
$45
$47
$115 $108
$85
$108
$108
General Retail
Food Products
Transportation
Construction
Business To Business
Miscellaneous
County Pool
(Cash Basis)
11 COUNCIL COMMUNICATION
CC #: 2810
File #: 0704 & 0200
Title:

Roseville Soccer Complex Traffic Signal and Roadway Improvements - Interfund Loan
Contact: Scott Pettingell 916-746-1306 [email protected] Meeting Date: 6/21/2023
Item #: 7.30.

RECOMMENDATION TO COUNCIL
Staff recommends that the City Council approve an interfund loan of $3,217,833 from the General Fund Capital Reserve Fund to the Traffic Mitigation Fund to construct traffic signal and roadway improvements to accommodate the construction of the Roseville Soccer Complex.

BACKGROUND
A traffic study conducted for the Roseville Soccer Complex indicated that traffic signal and roadway improvements already included in the City's long-term Capital Improvement Program were needed at the intersections of Blue Oaks Boulevard & Westbrook Boulevard, Blue Oaks Boulevard & Hayden Parkway, Westbrook Boulevard & Brookstone Drive (N), and Westbrook Boulevard & Brookstone Drive (S) to accommodate the opening of the Complex under construction east of Westbrook Boulevard. To fully fund and expedite the completion of these improvements, staff recommends that the City Council approve an interfund loan between the General Fund Capital Reserve Fund and the Traffic Mitigation Fund (TMF) of $3,217,833. The loan is intended to preserve the TMF for current and upcoming TMF priorities already in progress.

FISCAL IMPACT
Pursuant to the interfund loan terms, the TMF Fund will repay the General Fund Capital Reserve Fund over 20 years. The interfund loan includes estimated interest payments totaling $624,208.

The first loan principal repayment is scheduled for FY2026-27. The annual interest rate for this interfund loan will be the City's prior year's average pooled interest rate. The loan terms and amortization schedule are attached to this communication. This interfund loan is consistent with the Council-approved interfund loan policy. The proposed FY2023-24 budget includes this interfund loan to fund the project.

ENVIRONMENTAL REVIEW
The California Environmental Quality Act (CEQA) does not apply to activities that will not result in a direct or reasonably foreseeable indirect physical change in the environment, or is otherwise not considered a project as defined by CEQA Statute §21065 and CEQA State Guidelines §15060(c)(3) and §15378. The interfund loan meets the above criteria and is not subject to CEQA. No additional environmental review is required.

CITY COUNCIL STRATEGIC PLAN/OVERARCHING GOALS
Goal F - Invest in well-planned infrastructure and growth Respectfully Submitted,
Scott Pettingell, Assistant Finance Director
Dennis Kauffman, Assistant City Manager/Chief Financial Officer _____________________________
Dominick Casey, City Manager
ATTACHMENTS:

Description
Interfund Loan
Term: 20 years
FY22 FY23* FY24* FY25* FY26* FY27* FY28*
Interest Rate 1.07% 1.07% 1.07% 1.50% 1.50% 1.50% 1.50% FY29* FY30* FY31* FY32* FY33* FY34* FY35*
Interest Rate 1.50% 1.50% 1.50% 1.50% 1.50% 1.50% 1.50% FY36* FY37* FY38* FY39* FY40* FY41* FY42*
Interest Rate 1.50% 1.50% 1.50% 1.50% 1.50% 1.50% 1.50% Date Interest
Principal
Reduction
Loan Balance Long Term
Current
Portion
Annual Payment
Due
Fiscal Year
6/30/2023 3,217,833 3,217,833 0 0 FY23
6/30/2024 28,597 3,217,833 3,217,833 0 28,597 FY24
6/30/2025 48,267 3,217,833 3,217,833 0 48,267 FY25
6/30/2026 48,267 3,217,833 3,217,833 0 48,267 FY26
6/30/2027 48,267 51,733 3,166,100 3,114,368 51,733 100,000 FY27 6/30/2028 47,492 52,508 3,113,592 3,061,084 52,508 100,000 FY28 6/30/2029 46,704 53,296 3,060,296 3,007,000 53,296 100,000 FY29 6/30/2030 45,904 54,096 3,006,200 2,952,105 54,096 100,000 FY30 6/30/2031 45,093 54,907 2,951,293 2,896,386 54,907 100,000 FY31 6/30/2032 44,269 268,299 2,682,994 2,414,695 268,299 312,569 FY32 6/30/2033 40,245 268,299 2,414,695 2,146,395 268,299 308,544 FY33 6/30/2034 36,220 268,299 2,146,395 1,878,096 268,299 304,520 FY34 6/30/2035 32,196 268,299 1,878,096 1,609,796 268,299 300,495 FY35 6/30/2036 28,171 268,299 1,609,796 1,341,497 268,299 296,471 FY36 6/30/2037 24,147 268,299 1,341,497 1,073,198 268,299 292,446 FY37 6/30/2038 20,122 268,299 1,073,198 804,898 268,299 288,422 FY38 6/30/2039 16,098 268,299 804,898 536,599 268,299 284,397 FY39 6/30/2040 12,073 268,299 536,599 268,299 268,299 280,373 FY40 6/30/2041 8,049 268,299 268,299 0 268,299 276,348 FY41
6/30/2042 4,024 268,299 0 0 268,299 272,324 FY42
624,208 3,217,833 3,217,833 3,217,833 0 3,842,041
First Payment: FY24
Repayment Source: TMF
*estimated based upon prior year's interest rate
A44 - Function No. 26044
Loan from General Fund Capital Reserve Fund (Fund 1012) to Traffic Mitigation Fund (Fund 3151) Loan Purpose - A traffic study conducted for the Roseville Soccer Complex indicated that traffic signal and roadway improvements already included in the City's long term Capital Improvement Program were needed at the intersections of Blue Oaks Boulevard & Westbrook Boulevard, Blue Oaks Boulevard & Hayden Parkway, Westbrook Boulevard & Brookstone Drive (N), and Westbrook Boulevard & Brookstone Drive (S) to accommodate opening of the Complex under construction east of Westbrook Boulevard. To fully fund these improvements, staff recommends that the City Council approve an interfund loan between the Capital Reserve Fund (1012) and the Traffic Mitigation Fund (TMF) (3151) of $3,217,833. The loan is intended to preserve the TMF for current and upcoming TMF priorities already in progress.

Loan Amount: $3,217,833
Council Approval Date: 6/21/2023
Interest Rate: The interest rate is based upon the City's prior year average annual pooled interest rate (for example, the City's FY22 average annual pooled interest rate will be used to calculate the FY23 interest amount). This policy was implemented to create more accurate budgeting and to expedite the process of calculating and recording the interest amount each year.

COUNCIL COMMUNICATION
CC #: 2786
File #: 0103 & 0103-08-02 & 0103-09-02 & 0103-34-02 & 0103-44-02 Title: Board and Commissions Bi-Annual Vacancies
Contact: Katrina Six 916-774-5267 [email protected] Meeting Date: 6/21/2023
Item #: 8.1.

RECOMMENDATION TO COUNCIL
Recommend that the City Council appoint one (1) individual to the Design Committee to a term expiring June 30, 2027 from the applications received from: Sandra Boyle and Dharmendra Panchal.

Appoint three (3) individuals to the Economic Development Advisory Committee to terms expiring June 30, 2025 from the applications received from: Naaz Alikhan, Herb Bal, Blandon Granger, Lauren Razzano, Jeff Richardson, and Michael Tronnes.

Appoint two (2) individuals to the Grants Advisory Commission to terms expiring June 30, 2027 from the applications received from: Andrew Keller, Lorin Meeks-Harris, Dharmendra Panchal, and Neva Parker.

Appoint three (3) individuals to the Public Utilities Commission to terms expiring June 30, 2027 from the applications received from: Herb Bal, John DeLacy, Andrew Keller, Lorin Meeks-Harris, Scott Sanford, John Speight, Ellen Springer, and Elaine Webb.

BACKGROUND
Appointments to the Design Committee, Economic Development Advisory Committee, Grants Advisory Commission, and Public Utilities Commission are due to be made as part of the biannual recruitment process. Recruitment for all vacancies occurred in May 2023, video interviews of the applicants were conducted by the City Clerk Department, and the City Attorney’s Office reviewed the Statements of Economic Interest (Form 700) for potential conflicts of interest. The application, video interviews, and confidential attorney review are compiled and provided to the City Council for consideration.

FISCAL IMPACT
Not applicable.

ENVIRONMENTAL REVIEW
The California Environmental Quality Act (CEQA) does not apply to activities that will not result in a direct or reasonably foreseeable indirect physical change in the environment, or is otherwise not considered a project as defined by CEQA Statute §21065 and CEQA State Guidelines §15060(c)(3) and §15378. The appointment of members to boards or commissions meets the above criteria and is not subject to CEQA. No additional environmental review is required.

CITY COUNCIL STRATEGIC PLAN/OVERARCHING GOALS
Goal B - Support community engagement and advocacy
Respectfully Submitted,
Katrina Six, City Clerk Technician
Carmen Avalos, City Clerk
_____________________________
Dominick Casey, City Manager

COUNCIL COMMUNICATION
CC #: 2789
File #: 0206-03-01
Title:

Creekview Community Facilities District No. 1, Improvement Area 2, Series 2023 - Bond Issuance
Contact: Jeannine Thrash 916-774-5473 [email protected] Dennis Kauffman 916-774-5313 [email protected]
Meeting Date: 6/21/2023
Item #: 9.1.

RECOMMENDATION TO COUNCIL
Staff recommends that the City Council adopt a Resolution Authorizing the Issuance of Special Tax Bonds for and on Behalf of Improvement Area No. 2 of the City of Roseville Creekview Community Facilities District No. 1 (Public Facilities), Approving and Directing the Execution of a Fiscal Agent Agreement and a Bond Purchase Agreement, Approving the Form of Preliminary Official Statement, Approving Sale of Such Bonds, and Approving Other Related Documents and Actions.

BACKGROUND
Creekview Community Facility District (CFD) No. 1 (Public Facilities) was formed on November 6, 2019, with Resolution 19-456. The maximum authorized indebtedness for the District is allocated as follows: (i) Improvement Area No. 1: $81,000,000 and (ii) for the Future Annexation Area established for the District, an amount not to exceed $137,000,000. On August 26, 2020 the first series of bonds were issued in the amount of $10,905,000. The second series of bonds were issued on December 14, 2021 in the amount of $12,500,000.

The Series 2023 bonds are being issued at the developer's request, in an amount not to exceed $17,000,000, to (i) construct and/or acquire certain authorized public facilities, (ii) provide for a deposit to a debt service reserve account for the 2023 Bonds, and (iii) pay costs of issuance of the 2023 Bonds. The 2023 bonds are the first series to be issued for Improvement Area No. 2.

FISCAL IMPACT
The CFD will generate special taxes that will be paid by the property owners sufficient to pay the costs of the debt service, CFD administration, and any authorized pay-as-you-go facilities, as well as provide funding in the future for maintenance/replacement of constructed facilities. The issuance of these bonds will not impact the City's General Fund.

ENVIRONMENTAL REVIEW
The California Environmental Quality Act (CEQA) does not apply to activities that will not result in a direct or reasonably foreseeable indirect physical change in the environment, or is otherwise not considered a project as defined by CEQA Statute §21065 and CEQA State Guidelines §15060(c)(3) and §15378. Adoption of the resolution and approval of the agreements and preliminary official statement described herein, meets the above criteria and is not subject to CEQA. No additional environmental review is required.

COMPLIANCE STATEMENT
In accordance with Government Code 5852.1, the following information consists of estimates of certain costs and charges for the Bonds that have been provided by the City's municipal financial advisor, which has been represented by such party to have been provided in good faith: (1) estimated true interest costs of the Bonds: 5.78%; (2) estimated finance charge of the Bonds (sum of all fees and charges paid to third parties): $375,000; (3) estimated amount of proceeds of the Bonds received by the City (net of finance charges, reserves and capitalized interest, if any):
$12,838,280; and (4) estimated total payment amount (sum total of all payments to pay debt service on the Bonds plus the finance charge not paid with proceeds of the Bonds) calculated to the final maturity of the Bonds: $34,063,949.

CITY COUNCIL STRATEGIC PLAN/OVERARCHING GOALS
Goal F - Invest in well-planned infrastructure and growth Respectfully Submitted,
Jeannine Thrash, Management Analyst
Dennis Kauffman, Assistant City Manager/Chief Financial Officer _____________________________
Dominick Casey, City Manager
ATTACHMENTS:

Description
Resolution 23-271
Fiscal Agent Agreement
Preliminary Official Statement
Bond PurchaseAgreement
RESOLUTION NO. 23-271

A RESOLUTION AUTHORIZING THE ISSUANCE OF SPECIAL TAX BONDS FOR AND ON BEHALF OF IMPROVEMENT AREA NO. 2 OF THE CITY OF ROSEVILLE CREEKVIEW COMMUNITY FACILITIES DISTRICT NO. 1 (PUBLIC FACILITIES), APPROVING AND DIRECTING THE EXECUTION OF A

FISCAL AGENT AGREEMENT AND A BOND PURCHASE AGREEMENT,

APPROVING THE FORM OF PRELIMINARY OFFICIAL STATEMENT,

APPROVING SALE OF SUCH BONDS, AND APPROVING OTHER RELATED

DOCUMENTS AND ACTIONS
WHEREAS, this City Council (the “Council”) of the City of Roseville (the “City”) has conducted proceedings under and pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, Chapter 2.5 of Part 1 of Division 2 of Title 5, commencing at Section 53311, of the California Government Code (the “Act”), to form the Creekview Community Facilities District No. 1 (Public Facilities) (the “District”) and the Creekview Community Facilities District No. 1 (Public Facilities) (Future Annexation Area) (the “Future Annexation Area”), to annex property to the District that was designate Improvement Area No. 2 of the Creekview Community Facilities District No. 1 (Public Facilities) (“Improvement Area No. 2”), to authorize the levy of special taxes upon the land within Improvement Area No. 2, and to issue bonds secured by said special taxes for the purpose of providing moneys for the construction and acquisition of authorized improvements for the District; and WHEREAS, the Council, as legislative body of the District, authorized the incurrence of bonded indebtedness for the District, including the Future Annexation Area, in the maximum aggregate principal amount of $218,000,000, currently allocated as follows: (i) for Improvement Area No. 1, $81,000,000 and (ii) for the portion of the Future Annexation Area, an amount not to exceed $137,000,000; and
WHEREAS, upon annexation of a portion of the Future Annexation Area into the District as Improvement Area No. 2, the amount of $111,000,000 of the original $137,000,000 was allocated to Improvement Area No. 2 (the “Authorization”), and the City now desires to issue the first series of special tax bonds for Improvement Area No. 2 under the Authorization (the “Bonds”); and
WHEREAS, there has been submitted to the City Council a Fiscal Agent Agreement (the “Fiscal Agent Agreement”) between the City and U.S. Bank Trust Company, National Association, as fiscal agent, providing for the issuance of the Bonds of the City for Improvement Area No. 2 of the District, and the Council, with the aid of City staff, has reviewed the Fiscal Agent Agreement and found it to be in proper order, and now desires to approve the Fiscal Agent Agreement and the issuance of the Bonds; and
WHEREAS, the City proposes to sell the Bonds to Piper Sandler & Co., as underwriter (the “Underwriter”), pursuant to the terms of a Bond Purchase Agreement by and between the City and the Underwriter, and the Underwriter proposes to offer the Bonds to the investing public by means of a Preliminary Official Statement, and the Council, with the aid of City staff, has reviewed the Bond Purchase Agreement and the Preliminary Official Statement and found them to be in proper order, and now desires to approve said documents; and - 2 -
WHEREAS, the information required to be obtained and disclosed with respect to the Bonds by the City Council in accordance with Section 5852.1 of the California Government Code is set forth in the staff report accompanying this Resolution; and WHEREAS, all conditions, things and acts required to exist, to have happened and to have been performed precedent to and in the issuance of the Bonds as contemplated by this Resolution and the documents referred to herein exist, have happened and have been performed in due time, form and manner as required by the laws of the State of California, including the Act.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF ROSEVILLE RESOLVES AS FOLLOWS:

1. Findings. This Council finds and determines that it is prudent in the management and development of land in the City and the District to issue the Bonds for the purpose of providing moneys for the construction and acquisition of authorized improvements for the District.

2. Law Applicable. For the purposes of these proceedings in and for the District, the Act shall be the authority for the issuance of the Bonds.

3. Bonds Authorized. Pursuant to the Act, this Resolution and the Fiscal Agent Agreement, special tax bonds of the City designated as “City of Roseville Creekview Community Facilities District No. 1 (Public Facilities) Improvement Area No. 2 Special Tax Bonds Series 2023” in an aggregate principal amount not to exceed $17,000,000 are hereby authorized to be issued. The Bonds shall be executed in the form set forth in and otherwise as provided in the Fiscal Agent Agreement.

The Bonds shall not be issued unless the value of the real property within Improvement Area No. 2 subject to the special tax to pay debt service on the Bonds, based on assessed values and/or an appraisal by an independent appraiser hired by the City for the purpose of determining such value, is at least three (3) times the proposed principal amount of the Bonds proposed to be issued and secured by a special tax levied pursuant to the Act on property within Improvement Area No. 2, plus the portion of all other bonds outstanding that are secured by a special tax levied under the Act on property within Improvement Area No. 2 or a special assessment levied on property within Improvement Area No. 2.

4. Fiscal Agent Agreement. The Council hereby approves the Fiscal Agent Agreement in the form presented to the Council at this meeting. The City Manager, Chief Financial Officer and such other person or persons as either of them may designate (collectively, the “Authorized Officers”), each acting alone or together with any other Authorized Officer, are each hereby authorized and directed to execute the Fiscal Agent Agreement, for and in the name and on behalf of the City, in such form, together with any additions thereto or changes therein deemed necessary or advisable by the Authorized Officer executing such document upon consultation with Jones Hall, A Professional Law Corporation, as bond counsel to the City (“Bond Counsel”).

The proceeds of the Bonds shall be applied by the City for the purposes and in the amounts as set forth in the Fiscal Agent Agreement. The Council hereby authorizes the delivery and performance by the City of the Fiscal Agent Agreement.
- 3 -

5. Covenant to Foreclose. The City hereby covenants, for the benefit of the owners of the Bonds, to commence and diligently pursue to completion any foreclosure action regarding delinquent installments of any amount levied as a special tax for the payment of interest or principal of the Bonds, said foreclosure action to be commenced and pursued as more completely set forth in the Fiscal Agent Agreement.

6. Approval of Official Statement and Continuing Disclosure Certificate. The Council hereby approves the Preliminary Official Statement with respect to the Bonds, in substantially the form on file with the City Clerk. Distribution of the Preliminary Official Statement by the City and the Underwriter is hereby approved, and, prior to the distribution of the Preliminary Official Statement, and each Authorized Officer, each acting alone or together with any other Authorized Officer, is authorized and directed, on behalf of the City, to deem the Preliminary Official Statement “final” pursuant to Rule 15c2-12 under the Securities Exchange Act of 1934 (the “Rule”). The execution of the final Official Statement, which shall include such changes and additions thereto deemed advisable by the Authorized Officer executing the same, and such information permitted to be excluded from the Preliminary Official Statement pursuant to the Rule, is hereby approved for delivery to the purchasers of the Bonds, and each Authorized Officer, each acting alone or together with any other Authorized Officer, is authorized and directed to execute and deliver the final Official Statement for and on behalf of the City, with final pricing information included and with such changes and additions thereto deemed advisable by the Authorized Officer executing the same.

The Council hereby approves the Continuing Disclosure Certificate to be executed by the City, the form of which is attached as an exhibit to the Preliminary Official Statement. Each of the Authorized Officers is hereby authorized and directed to approve any changes in or additions to a final form of said Continuing Disclosure Certificate, and the execution thereof by an Authorized Officer shall be conclusive evidence of approval of any such changes and additions. The final Continuing Disclosure Certificate shall be executed in the name and on behalf of the City by an Authorized Officer.

7. Approval of Bond Purchase Agreement. The Council hereby approves the Bond Purchase Agreement in substantially the form on file with the City Clerk; provided, that the aggregate principal amount of Bonds shall not exceed $17,000,000 or result in an Underwriter’s discount in excess of 1.45% of the par amount of the Bonds, or a true interest cost in excess of

6.75%. Subject to the foregoing parameters, an Authorized Officer is hereby authorized and directed to execute the Bond Purchase Agreement in substantially the form on file with the City Clerk, together with such changes and additions thereto deemed advisable by the Authorized Officer executing the same. The Council hereby finds and determines that the sale of the Bonds at negotiated sale as contemplated by the Bond Purchase Agreement will result in a lower overall cost.

8. Actions Authorized. All actions heretofore taken by the officers, employees and agents of the City with respect to the establishment of the District and the Future Annexation Area, the designation of Improvement Area No. 2, and the sale and issuance of the Bonds are hereby approved, confirmed and ratified, and the Authorized Officers of the City are hereby authorized and directed to do any and all things and take any and all actions and execute any and all certificates, agreements and other documents, which they, or any of them, may deem necessary or advisable in order to consummate the lawful issuance and delivery of the Bonds in accordance with this resolution, and any certificate, agreement, and other document described in the documents herein approved. All actions to be taken by a specified Authorized Officer as - 4 -
specified herein, may be taken by the Authorized Officer or any designee, with the same force and effect as if taken by such Authorized Officer.

9. Effectiveness. This Resolution shall take effect upon its adoption. * * * * *
I hereby certify that the foregoing Resolution was duly adopted by the City Council of the City of Roseville, California, at a regularly scheduled meeting thereof, held on the ____ day of ________, 2023, by the following vote of the City Council:

AYES: COUNCILMEMBERS
NOES: COUNCILMEMBERS
ABSENT: COUNCILMEMBERS
ABSTAIN: COUNCILMEMBERS
_______________________________________
Mayor
ATTEST:

City Clerk
Jones Hall Draft of May 30, 2023

FISCAL AGENT AGREEMENT
by and between

CITY OF ROSEVILLE
and
U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION,
as Fiscal Agent
Dated as of July 1, 2023
Relating to:
$______________
City of Roseville
Creekview Community Facilities District No. 1 (Public Facilities) Improvement Area No. 2
Special Tax Bonds
Series 2023
i

TABLE OF CONTENTS

ARTICLE I

STATUTORY AUTHORITY AND DEFINITIONS
Section 1.01. Authority for this Agreement .........................................................................................3 Section 1.02. Agreement for Benefit of Bondowners ..........................................................................3 Section 1.03. Definitions .....................................................................................................................3

ARTICLE II
THE 2023 BONDS
Section 2.01. Principal Amount; Designation....................................................................................12 Section 2.02. Terms of the 2023 Bonds............................................................................................12 Section 2.03. Redemption.................................................................................................................13 Section 2.04. Form of Bonds.............................................................................................................16 Section 2.05. Execution of Bonds .....................................................................................................17 Section 2.06. Transfer of Bonds........................................................................................................17 Section 2.07. Exchange of Bonds .....................................................................................................18 Section 2.08. Bond Register .............................................................................................................18 Section 2.09. Temporary Bonds........................................................................................................18 Section 2.10. Bonds Mutilated, Lost, Destroyed or Stolen ...............................................................18 Section 2.11. Limited Obligation .......................................................................................................19 Section 2.12. Book-Entry Only System.............................................................................................19 Section 2.13. No Acceleration...........................................................................................................20

ARTICLE III

ISSUANCE OF BONDS
Section 3.01. Issuance and Delivery of Bonds .................................................................................21 Section 3.02. Application of Proceeds of Sale of 2023 Bonds..........................................................21 Section 3.03. Special Tax Fund ........................................................................................................21 Section 3.04. Improvement Fund......................................................................................................22 Section 3.05. Costs of Issuance Fund ..............................................................................................23

ARTICLE IV
SPECIAL TAX REVENUES; BOND FUND AND RESERVE FUND
Section 4.01. Pledge of Special Tax Revenues and Other Amounts. ..............................................25 Section 4.02. Bond Fund...................................................................................................................25 Section 4.03. Reserve Fund..............................................................................................................27

ARTICLE V

OTHER COVENANTS OF THE CITY
Section 5.01. Punctual Payment .......................................................................................................29 Section 5.02. Limited Obligation .......................................................................................................29 Section 5.03. Extension of Time for Payment...................................................................................29 Section 5.04. Against Encumbrances ...............................................................................................29 Section 5.05. Books and Accounts ...................................................................................................29 Section 5.06. Protection of Security and Rights of Owners ..............................................................29 Section 5.07. Compliance with Law; Completion of Project .............................................................30 Section 5.08. Private Activity Bond Limitation...................................................................................30 Section 5.09. Federal Guarantee Prohibition....................................................................................30 Section 5.10. Collection of Special Tax Revenues ...........................................................................30 Section 5.11. Further Assurances.....................................................................................................31 Section 5.12. No Arbitrage ................................................................................................................31 Section 5.13. Maintenance of Tax-Exemption ..................................................................................31 Section 5.14. Annual State Reports..................................................................................................31 Section 5.15. Covenant to Foreclose................................................................................................32 Section 5.16. Continuing Disclosure to Owners................................................................................32 ii
Section 5.17. Additional Bonds .........................................................................................................32 Section 5.18. Yield of the Bonds .......................................................................................................34

ARTICLE VI
INVESTMENTS; DISPOSITION OF INVESTMENT PROCEEDS;

LIABILITY OF THE CITY
Section 6.01. Deposit and Investment of Moneys in Funds..............................................................35 Section 6.02. Rebate of Excess Investment Earnings to the United States .....................................36 Section 6.03. Limited Obligation .......................................................................................................36

ARTICLE VII

THE FISCAL AGENT
Section 7.01. Appointment of Fiscal Agent .......................................................................................38 Section 7.02. Liability of Fiscal Agent ...............................................................................................38 Section 7.03. Information ..................................................................................................................41 Section 7.04. Notice to Fiscal Agent .................................................................................................41 Section 7.05. Compensation, Indemnification...................................................................................42

ARTICLE VIII

MODIFICATION OR AMENDMENT OF THIS AGREEMENT
Section 8.01. Amendments Permitted ..............................................................................................43 Section 8.02. Owners’ Meetings .......................................................................................................43 Section 8.03. Procedure for Amendment with Written Consent of Owners ......................................44 Section 8.04. Disqualified Bonds ......................................................................................................44 Section 8.05. Effect of Supplemental Agreement .............................................................................44 Section 8.06. Endorsement or Replacement of Bonds Issued After Amendments ..........................45 Section 8.07. Amendatory Endorsement of Bonds ...........................................................................45 Section 8.08. Opinion of Counsel Regarding Supplemental Agreement ..........................................45

ARTICLE IX

MISCELLANEOUS
Section 9.01. Benefits of Agreement Limited to Parties ...................................................................46 Section 9.02. Successor is Deemed Included in All References to Predecessor.............................46 Section 9.03. Discharge of Agreement .............................................................................................46 Section 9.04. Execution of Documents and Proof of Ownership by Owners....................................47 Section 9.05. Waiver of Personal Liability.........................................................................................47 Section 9.06. Notices to and Demands on City and Fiscal Agent ....................................................47 Section 9.07. Partial Invalidity...........................................................................................................48 Section 9.08. Unclaimed Moneys......................................................................................................48 Section 9.09. Applicable Law............................................................................................................48 Section 9.10. Conflict with Act...........................................................................................................48 Section 9.11. Conclusive Evidence of Regularity .............................................................................48 Section 9.12. Payment on Business Day..........................................................................................48 Section 9.13. Counterparts ...............................................................................................................48 Section 9.14. Waiver of Jury Trial .....................................................................................................49 Section 9.15. U.S.A. Patriot Act ........................................................................................................49

EXHIBIT A FORM OF BOND
EXHIBIT B OFFICER’S CERTIFICATE REQUESTING DISBURSEMENT FROM

IMPROVEMENT FUND

FISCAL AGENT AGREEMENT
THIS FISCAL AGENT AGREEMENT (the “Agreement”) is made and entered into as of July 1, 2023, by and between the City of Roseville, a charter city and public body, corporate and politic, organized and existing under and by virtue of the Constitution and laws of the State of California (the “City”) for and on behalf of the City of Roseville Creekview Community Facilities District No. 1 (Public Facilities) (the “District”), and U.S. Bank Trust Company, National Association, as fiscal agent (the “Fiscal Agent”).

W I T N E S S E T H :

WHEREAS, the City Council of the City has conducted proceedings under and pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, Chapter 2.5 of Part 1 of Division 2 of Title 5, commencing at Section 53311, of the California Government Code (the “Act”), to form the District and the Creekview Community Facilities District No. 1 (Public Facilities) (Future Annexation Area) (the “Future Annexation Area”), to annex property to the District that was designated Improvement Area No. 2 of the Creekview Community Facilities District No. 1 (Public Facilities) (“Improvement Area No. 2”), to authorize the levy of Special Taxes upon the land within Improvement Area No. 2, and to issue bonds secured by said Special Taxes for the purpose of providing moneys for the construction and acquisition of authorized improvements for the District; and
WHEREAS, the City Council, as legislative body of the District, authorized the incurrence of bonded indebtedness for the District, including the Future Annexation Area, in the maximum aggregate principal amount of $218,000,000, currently allocated as follows: (i) for Improvement Area No. 1, $81,000,000 and (ii) for the portion of the Future Annexation Area, an amount not to exceed $137,000,000; and
WHEREAS, upon annexation of a portion of the Future Annexation Area into the District as Improvement Area No. 2, the amount of $111,000,000 of the original $137,000,000 was allocated to Improvement Area No. 2 (the “Authorization”), and the City now desires to issue the first series of special tax bonds for Improvement Area No. 2 under the Authorization; and WHEREAS, under the provisions of the Act, on ___________, 2023, the City Council of the City adopted its Resolution No. _____ (the “Resolution”), which resolution, among other matters, authorized the issuance of its “City of Roseville Creekview Community Facilities District No. 1 (Public Facilities) Improvement Area No. 2 Special Tax Bonds Series 2023” to provide moneys for the construction and acquisition of improvements for the District, and provided that said issuance would be in accordance with the Act and this Agreement and authorized the execution hereof; and
WHEREAS, it is in the public interest and for the benefit of the City, the District, the persons responsible for the payment of Special Taxes and the Owners of the Bonds (as defined herein) that the City enter into this Agreement to provide for the issuance of the Bonds, the disbursement of proceeds of the Bonds, the disposition of the Special Taxes securing the Bonds and any additional bonds authorized to be issued hereunder and the administration and payment of the Bonds; and
WHEREAS, the City has determined that all things necessary to cause the Bonds, when authenticated by the City for Improvement Area No. 2 of the District and issued as in the Act, 2 the Resolution and this Agreement provided to be legal, valid and binding and special obligations of the City for Improvement Area No. 2 of the District in accordance with their terms, and all things necessary to cause the creation, authorization, execution and delivery of this Agreement and the creation, authorization, execution and issuance of the Bonds, subject to the terms hereof, have in all respects been duly authorized.

NOW, THEREFORE, in consideration of the covenants and provisions herein set forth and for other valuable consideration the receipt and sufficiency of which are hereby acknowledged, the parties hereto do hereby agree as follows:
3 ARTICLE I

STATUTORY AUTHORITY AND DEFINITIONS
Section 1.01. Authority for this Agreement. This Agreement is entered into pursuant to the provisions of the Act and the Resolution.

Section 1.02. Agreement for Benefit of Bondowners. The provisions, covenants and agreements herein set forth to be performed by or on behalf of the City shall be for the equal benefit, protection and security of the Owners. All of the Bonds, without regard to the time or times of their issuance or maturity, shall be of equal rank without preference, priority or distinction of any of the Bonds over any other thereof, except as expressly provided in or permitted by this Agreement. The Fiscal Agent may become the Owner of any of the Bonds in its own or any other capacity and may otherwise deal with the City or the District with the same rights it would have if it were not Fiscal Agent.

Section 1.03. Definitions. Unless the context otherwise requires, the terms defined in this Section 1.03 shall, for all purposes of this Agreement, of any Supplemental Agreement, and of any certificate, opinion or other document herein mentioned, have the meanings herein specified. All references herein to “Articles,” “Sections” and other subdivisions are to the corresponding Articles, Sections or subdivisions of this Agreement, and the words “herein,” “hereof,” “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section or subdivision hereof. “Acquisition Agreement” means the Funding, Construction and Acquisition Agreement for the District dated as of September 9, 2020, by and between the City and the Developer. “Act” means the Mello-Roos Community Facilities Act of 1982, as amended, Section 53311, et seq., of the California Government Code.
“Additional Bonds” means any series of bonds issued on a parity with the 2023 Bonds pursuant to Section 5.17.
“Administrative Expenses” means any or all of the following: the fees and expenses of the Fiscal Agent (including, but not limited to, any fees or expenses of its counsel), the expenses of the City in carrying out its duties hereunder (including, but not limited to, the levying and collection of the Special Taxes, and the foreclosure of the liens of delinquent Special Taxes) including the fees and expenses of its counsel, an allocable share of the salaries of City staff directly related thereto and a proportionate amount of City general administrative overhead related thereto, any amounts paid by the City from its general funds pursuant to Section 6.02, and all other fees, costs and expenses of the City or the Fiscal Agent incurred in connection with the issuance and administration of the Bonds and/or the discharge of their respective duties hereunder (including, but not limited to, the calculation of the levy of the Special Taxes, foreclosures with respect to delinquent taxes, and the calculation of amounts subject to rebate to the United States) and, in the case of the City, in any way related to the administration of the District. Administrative Expenses shall include any such expenses incurred in prior years but not yet paid, and any advances of funds by the City under Section 6.02 hereof.
“Agreement” means this Fiscal Agent Agreement, as it may be amended or supplemented from time to time by any Supplemental Agreement. 4 “Annual Debt Service” means, for each Bond Year and each series of Outstanding Bonds, the sum of (i) the interest due on the respective series of Outstanding Bonds in such Bond Year, assuming that such Outstanding Bonds are retired as scheduled, and (ii) the principal amount of the respective series of Outstanding Bonds, including any mandatory sinking fund payments, due in such Bond Year.
“Authorized Officer” means the City Manager, Chief Financial Officer, City Attorney or any other officer or employee authorized by the City Council of the City or by an Authorized Officer to undertake the action referenced in this Agreement as required to be undertaken by an Authorized Officer.
“Bond Counsel” means (i) Jones Hall, A Professional Law Corporation or (ii) any other attorney or firm of attorneys acceptable to the City and nationally recognized for expertise in rendering opinions as to the legality and tax-exempt status of securities issued by public entities.
“Bond Fund” means the fund by that name established pursuant to Section 4.02(A) hereof.
“Bond Year” means each twelve-month period beginning on September 2 in any year and extending to the next succeeding September 1, both dates inclusive; except that the first Bond Year shall begin on the Closing Date and end on September 1, 2023. “Bonds” means the 2023 Bonds and any Additional Bonds.
“Business Day” means any day other than (i) a Saturday or a Sunday or (ii) a day on which banking institutions in the state in which the Principal Office of the Fiscal Agent is located are authorized or obligated by law or executive order to be closed. “CDIAC” means the California Debt and Investment Advisory Commission of the office of the California State Treasurer or any successor agency or bureau thereto. “Certificate of the Special Tax Consultant” means a written certificate signed by the special tax consultant or special tax administrator to the City with respect to the Bonds. “Chief Financial Officer” means the duly acting Chief Financial Officer of the City, or if the City has no Chief Financial Officer, the Finance Director, Treasurer or other officer of the City serving a similar role.
“City” means the City of Roseville, California, and any successor thereto. “Closing Date” means ____________, 2023, the date upon which there is a physical delivery of the 2023 Bonds in exchange for the amount representing the purchase price of the 2023 Bonds by the Original Purchaser.
“Code” means the Internal Revenue Code of 1986 as in effect on the date of issuance of the Bonds or (except as otherwise referenced herein) as it may be amended to apply to obligations issued on the date of issuance of the Bonds, together with applicable temporary and final regulations promulgated, and applicable official public guidance published, under the Code.
5 “Continuing Disclosure Certificate” means the Continuing Disclosure Certificate, dated as of the Closing Date, executed by the City and Willdan Financial Services, in its capacity as Dissemination Agent, as originally executed and as it may be amended from time to time in accordance with the terms thereof.
“Costs of Issuance” means items of expense payable or reimbursable directly or indirectly by the City and related to the authorization, sale and issuance of the Bonds, which items of expense shall include, but not be limited to, printing costs, costs of reproducing and binding documents, closing costs, filing and recording fees, initial fees, expenses and charges of the Fiscal Agent, including its first annual administration fee, and expenses and fees of counsel to the Fiscal Agent, expenses incurred by the City in connection with the issuance of the Bonds, financial advisor fees, Bond (underwriter’s) discount or underwriting fee, legal fees and charges, including bond counsel, charges for execution, transportation and safekeeping of the Bonds and other costs, charges and fees in connection with the foregoing. “Costs of Issuance Fund” means the fund by that name established pursuant to Section 3.05(A) hereof.
“Developer” means Anthem United Creekview Developments Limited Partnership, a Washington limited partnership, and its successors and assigns. “Debt Service” means the scheduled amount of interest and amortization of principal payable on the Bonds during the period of computation, excluding amounts scheduled during such period which relate to principal which has been retired before the beginning of such period. “Depository” means (i) initially, DTC, and (ii) any other Securities Depository acting as Depository pursuant to Section 2.12.
“District” means the City of Roseville Creekview Community Facilities District No. 1 (Public Facilities) formed pursuant to the Resolution of Formation. “DTC” means the Depository Trust Company, and its successors and assigns. “Fair Market Value” means the price at which a willing buyer would purchase the investment from a willing seller in a bona fide, arm’s length transaction (determined as of the date the contract to purchase or sell the investment becomes binding) if the investment is traded on an established securities market (within the meaning of Section 1273 of the Code) and, otherwise, the term “Fair Market Value” means the acquisition price in a bona fide arm’s length transaction (as referenced above) if (i) the investment is a certificate of deposit that is acquired in accordance with applicable regulations under the Code, (ii) the investment is an agreement with specifically negotiated withdrawal or reinvestment provisions and a specifically negotiated interest rate (for example, a guaranteed investment contract, a forward supply contract or other investment agreement) that is acquired in accordance with applicable regulations under the Code, (iii) the investment is a United States Treasury Security—State and Local Government Series that is acquired in accordance with applicable regulations of the United States Bureau of Public Debt, or (iv) the investment is the Local Agency Investment Fund of the State of California, but only if at all times during which the investment is held its yield is reasonably 6 expected to be equal to or greater than the yield on a reasonably comparable direct obligation of the United States.
“Federal Securities” means any of the following which are non-callable and which at the time of investment are legal investments under the laws of the State of California for funds held by the Fiscal Agent (the Fiscal Agent entitled to rely upon investment direction from the City as a certification that such investment constitutes a legal investment):
(i) Direct general obligations of the United States of America (including obligations issued or held in book-entry form on the books of the United States Department of the Treasury) and obligations, the payment of principal of and interest on which are directly or indirectly guaranteed by the United States of America, including, without limitation, such of the foregoing which are commonly referred to as “stripped” obligations and coupons; or
(ii) Any of the following obligations of the following agencies of the United States of America: (a) direct obligations of the Export-Import Bank, (b) certificates of beneficial ownership issued by the Farmers Home Administration, (c) participation certificates issued by the General Services Administration, (d) mortgage-backed bonds or passthrough obligations issued and guaranteed by the Government National Mortgage Association, (e) project notes issued by the United States Department of Housing and Urban Development, and (f) public housing notes and bonds guaranteed by the United States of America.
“Fiscal Agent” means the Fiscal Agent appointed by the City and acting as an independent fiscal agent with the duties and powers herein provided, its successors and assigns, and any other corporation or association which may at any time be substituted in its place, as provided in Section 7.01.
“Fiscal Year” means the twelve-month period extending from July 1 in a calendar year to June 30 of the succeeding year, both dates inclusive. “Improvement Area No. 2” means the area designated as Improvement Area No. 2 of the District through the annexation proceedings set forth in the Act. “Improvement Fund” means the fund by that name established pursuant to Section 3.04(A).
“Information Services” means “EMMA” or the “Electronic Municipal Market Access” system of the Municipal Securities Rulemaking Board; or, in accordance with then-current guidelines of the Securities and Exchange Commission, such other services providing information with respect to called bonds as the City may designate in an Officer’s Certificate delivered to the Fiscal Agent.
“Interest Payment Dates” means March 1 and September 1 of each year, commencing September 1, 2023.
“Maximum Annual Debt Service” means, for each series of Outstanding Bonds, the largest Annual Debt Service for any Bond Year after the calculation is made through the final maturity date of the respective series of Outstanding Bonds. 7 “Officer’s Certificate” means a written certificate of the City signed by an Authorized Officer of the City.
“Ordinance” means any ordinance of the City levying the Special Taxes. “Original Purchaser” means, with respect to each series of Bonds, the first purchaser of such Bonds from the City.
“Other Mello-Roos Bonds” has the meaning given that term in Section 5.17. “Outstanding,” when used as of any particular time with reference to Bonds, means (subject to the provisions of Section 8.04) all Bonds except (i) Bonds theretofore canceled by the Fiscal Agent or surrendered to the Fiscal Agent for cancellation; (ii) Bonds paid or deemed to have been paid within the meaning of Section 9.03; and (iii) Bonds in lieu of or in substitution for which other Bonds shall have been authorized, executed, issued and delivered by the City pursuant to the Agreement or any Supplemental Agreement. “Owner” or “Bondowner” means any person who shall be the registered owner of any Outstanding Bond.
“Participating Underwriter” shall have the meaning ascribed thereto in the Continuing Disclosure Certificate.
“Permitted Investments” means any of the following, to the extent that they are lawful investments for City funds at the time of investment, and are acquired at Fair Market Value (the Fiscal Agent is entitled to rely upon investment direction from the City as a certification that such investment constitutes a legal investment):
(i) Federal Securities;
(ii) any of following obligations of federal agencies not guaranteed by the United States of America: (a) debentures issued by the Federal Housing Administration; (b) participation certificates or senior debt obligations of the Federal Home Loan Mortgage Corporation or Farm Credit Banks (consisting of Federal Land Banks, Federal Intermediate Credit Banks or Banks for Cooperatives); (c) bonds or debentures of the Federal Home Loan Bank Board established under the Federal Home Loan Bank Act, bonds of any federal home loan bank established under said act and stocks, bonds, debentures, participations and other obligations of or issued by the Federal National Mortgage Association, the Student Loan Marketing Association, the Government National Mortgage Association and the Federal Home Loan Mortgage Corporation; and (d) bonds, notes or other obligations issued or assumed by the International Bank for Reconstruction and Development;
(iii) interest-bearing demand or time deposits (including certificates of deposit) in federal or State of California chartered banks (including the Fiscal Agent and its affiliates), provided that (a) in the case of a savings and loan association, such demand or time deposits shall be fully insured by the Federal Deposit Insurance Corporation, or the unsecured obligations of such savings and loan association shall be rated in one of the top two rating categories by a nationally recognized rating service, and (b) in the case of a bank, such demand or time deposits shall be fully insured by the Federal Deposit Insurance Corporation, or the unsecured obligations of such bank 8 (or the unsecured obligations of the parent bank holding company of which such bank is the lead bank) shall be rated in one of the top two rating categories by a nationally recognized rating service;
(iv) repurchase agreements with a registered broker/dealer subject to the Securities Investors Protection Corporation Liquidation in the event of insolvency, or any commercial bank provided that: (a) the unsecured obligations of such bank shall be rated in one of the top two rating categories by a nationally recognized rating service, or such bank shall be the lead bank of a banking holding company whose unsecured obligations are rated in one of the top two rating categories by a nationally recognized rating service; (b) the most recent reported combined capital, surplus an undivided profits of such bank shall be not less than $100 million; (c) the repurchase obligation under any such repurchase obligation shall be required to be performed in not more than thirty (30) days; (d) the entity holding such securities as described in clause (c) shall have a pledged first security interest therein for the benefit of the Fiscal Agent under the California Commercial Code or pursuant to the book-entry procedures described by 31 C.F.R. 306.1 et seq. or 31 C.F.R. 350.0 et seq. and are rated in one of the top two rating categories by a nationally recognized rating service; (v) bankers’ acceptances endorsed and guaranteed by banks described in clause (iv) above;
(vi) obligations, the interest on which is exempt from federal income taxation under Section 103 of the Code and which are rated in the one of the top two rating categories by a nationally recognized rating service;
(vii) money market funds which invest solely in Federal Securities or in obligations described in the preceding clause (ii) of this definition, or money market funds which are rated in the highest rating category by Standard & Poor’s Ratings Services or Moody’s Investor Service, including such funds for which the Fiscal Agent, its affiliates or subsidiaries provide investment advisory or other management services or for which the Fiscal Agent or an affiliate of the Fiscal Agent serves as investment administrator, shareholder servicing agent, and/or custodian or subcustodian, notwithstanding that (a) the Fiscal Agent or an affiliate of the Fiscal Agent receives and retains a fee for services provided to the fund, (b) the Fiscal Agent collects fees for services rendered pursuant to this Agreement, which fees are separate from the fees received from such funds, and (c) services performed for such funds and pursuant to this Agreement may at times duplicate those provided to such funds by the Fiscal Agent or an affiliate of the Fiscal Agent;
(viii) units of a taxable government money market portfolio comprised solely of obligations listed in (i) and (iv) above, such funds for which the Fiscal Agent, its affiliates or subsidiaries provide investment advisory or other management services or for which the Fiscal Agent or an affiliate of the Fiscal Agent serves as investment administrator, shareholder servicing agent, and/or custodian or subcustodian, notwithstanding that (a) the Fiscal Agent or an affiliate of the Fiscal Agent receives and retains a fee for services provided to the fund, (b) the Fiscal Agent collects fees for services rendered pursuant to this Agreement, which fees are separate from the fees received from such funds, and (c) services performed for such funds and pursuant to this Agreement may at times duplicate those provided to such funds by the Fiscal Agent or an affiliate of the Fiscal Agent;
9 (ix) any investment which is a legal investment for proceeds of the Bonds at the time of the execution of such agreement, and which investment is made pursuant to an agreement between the City or the Fiscal Agent or any successor Fiscal Agent and a financial institution or governmental body whose long term debt obligations are rated in one of the top two rating categories by a nationally recognized rating service; (x) commercial paper which at the time of purchase is of “prime” quality of the highest ranking or of the highest letter and numerical rating as provided for by Moody’s Investors Service, or Standard and Poor’s Corporation, of issuing corporations that are organized and operating within the United States and having total assets in excess of five hundred million dollars ($500,000,000) and having an “AA” or higher rating for the issuer’s debentures, other than commercial paper, as provided for by Moody’s Investors Service or Standard and Poor’s Corporation, and provided that purchases of eligible commercial paper may not exceed 180 days maturity nor represent more than 10 percent of the outstanding paper of an issuing corporation; (xi) any general obligation of a bank or insurance company whose long term debt obligations are rated in one of the two highest rating categories of a national rating service;
(xii) shares in a common law trust established pursuant to Title 1, Division 7, Charter 5 of the Government Code of the State which invests exclusively in investments permitted by Section 53635 of Title 5, Division 2, Chapter 4 of the Government Code of the State, as it may be amended;
(xiii) shares in the California Asset Management Program; or (xiii) the Local Agency Investment Fund established pursuant to Section 16429.1 of the Government Code of the State of California, provided, however, that the Fiscal Agent shall be permitted to make investments and withdrawals in its own name and the Fiscal Agent may restrict investments in the such fund if necessary to keep moneys available for the purposes of this Fiscal Agent Agreement. (xiv) any other lawful investment for City funds.
“Prepayment” means moneys received by the City from the prepayment of Special Taxes as provided in the Special Tax Formula.
“Prepayment Account” means the account within the Bond Fund by that name established pursuant to Section 4.02(A).
“Principal Office” means the designated corporate trust office of the Fiscal Agent set forth in Section 9.06, at which at any time its corporate trust business shall be administered, or such other or additional offices as may be designated by the Fiscal Agent, by notice to the District and the Owners, or the designated corporate trust office of any successor Fiscal Agent (or such other address as such successor Fiscal Agent may designate from time to time by notice to the District and Owners).
10 “Project” means the acquisition and/or construction of the authorized facilities for the District described in the Resolution of Formation, including Administrative Expenses related thereto.
“Qualified Reserve Fund Credit Instrument” means an irrevocable standby or direct-pay letter of credit or surety bond issued by a commercial bank or insurance company and deposited with the Fiscal Agent, provided that all of the following requirements are met: (i) the long-term credit rating of such bank or insurance company is rated in the top two categories (without regard to modifier) by S&P or Moody’s at the time of issuance; (ii) such letter of credit or surety bond has a term of at least 12 months; (iii) such letter of credit or surety bond has a stated amount at least equal to the portion of the Reserve Requirement being met by such instrument or with respect to which funds are proposed to be released pursuant to the Fiscal Agent Agreement; and (iv) the Fiscal Agent is authorized pursuant to the terms of such letter of credit or surety bond to draw thereunder an amount equal to any deficiencies which may exist from time to time in the Bond Fund for the purpose of making payments required pursuant to the Fiscal Agent Agreement.
“Record Date” means the 15th day of the month preceding an Interest Payment Date, whether or not such day is a Business Day.
“Regulations” means temporary and permanent regulations promulgated under the Code.
“Reserve Fund” means the fund by that name established pursuant to Section 4.03(A). “Reserve Requirement” means, with respect to any series of Bonds, the least of (i) 125% of the average Annual Debt Service with respect to the applicable series of Bonds; (ii) Maximum Annual Debt Service with respect to the applicable series of Bonds; and (iii) 10% of the original principal amount of the applicable series of Bonds (or, if the applicable series of Bonds has more than a de minimis amount of original issue discount or premium, 10% of the issue price of such series of Bonds); provided, that—
(a) the Reserve Requirement for the 2023 Bonds shall not increase after the date of issuance of the 2023 Bonds;
(b) in no event shall the City be obligated to deposit an amount in any reserve account 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; and
(c) the City may meet all or a portion of the Reserve Requirement with respect to any series of Bonds by depositing a Qualified Reserve Fund Credit Instrument in accordance with Section 4.03(A).
“Resolution” means Resolution No. ______ adopted by the City Council of the City on ______, 2023, which resolution, among other matters, authorized the issuance of the Bonds. “Resolution of Formation” means Resolution No. 19-456, adopted by the City Council of the City on November 6, 2019.
11 “Securities Depositories” means DTC; and, in accordance with then current guidelines of the Securities and Exchange Commission, such other addresses and/or such other securities depositories as the City may designate in an Officer’s Certificate delivered to the Fiscal Agent. “Special Tax Formula” means the “Rate, Method of Apportionment, and Manner of Collection of Special Tax for City of Roseville Creekview Community Facilities District No. 1 – Improvement Area No. 2 (Public Facilities),” approved by the qualified electors in Improvement Area No. 2, and as it may be amended in the future.
“Special Tax Fund” means the fund by that name established by Section 3.03(A) hereof. “Special Tax Revenues” means the proceeds of the Special Taxes received by the City, including all scheduled payments and delinquent payments thereof, interest thereon and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes, net of the administration charge of the County (currently at 1%), but shall not include any interest in excess of the interest due on the Bonds or any penalties collected in connection with any such foreclosure.
“Special Taxes” means the “Facilities Special Tax” (as defined in the Special Tax Formula) levied within Improvement Area No. 2 pursuant to the Act, the Ordinance, and this Agreement. For clarity, the “Maintenance Special Tax” (as defined in the Special Tax Formula) is not included in this definition of “Special Taxes” and does not constitute security for the repayment of the Bonds.
“Supplemental Agreement” means an agreement the execution of which is authorized by a resolution which has been duly adopted by the City under the Act and which agreement is amendatory of or supplemental to this Agreement, but only if and to the extent that such agreement is specifically authorized hereunder.
“Term 2023 Bonds” means the 2023 Bonds maturing on September 1, ______, September 1, ______, and September 1, ______.
“2023 Bonds” means the City of Roseville Creekview Community Facilities District No. 1 (Public Facilities) Improvement Area No. 2 Special Tax Bonds Series 2023. “2023 Capitalized Interest Account” means the fund by that name established pursuant to Section 4.02(A) hereof.
“2023 Reserve Account” means the account within the Reserve Fund by that name established pursuant to Section 4.03(A).
12 ARTICLE II
THE 2023 BONDS
Section 2.01. Principal Amount; Designation. The 2023 Bonds in the aggregate principal amount of $______________ are hereby authorized to be issued by the City for the District under and subject to the terms of the Resolution and this Agreement, the Act and other applicable laws of the State of California. The 2023 Bonds shall be designated the “City of Roseville Creekview Community Facilities District No. 1 (Public Facilities) Improvement Area No. 2 Special Tax Bonds Series 2023.”
Section 2.02. Terms of the 2023 Bonds.
(A) Form; Denominations. The 2023 Bonds shall be issued as fully registered Bonds without coupons in the denomination of $5,000 or any integral multiple of $5,000 in excess thereof. The 2023 Bonds shall be lettered and numbered in a customary manner as determined by the Fiscal Agent.
(B) Date of the 2023 Bonds. The 2023 Bonds shall be dated the Closing Date. (C) CUSIP Identification Numbers. “CUSIP” identification numbers shall be imprinted on the 2023 Bonds, but such numbers shall not constitute a part of the contract evidenced by the 2023 Bonds and any error or omission with respect thereto shall not constitute cause for refusal of any purchaser to accept delivery of and pay for the 2023 Bonds.

In addition, failure on the part of the City or the Fiscal Agent to use such CUSIP numbers in any notice to Owners shall not constitute an event of default or any violation of the City’s contract with such Owners and shall not impair the effectiveness of any such notice. The Fiscal Agent shall have no liability for any defect in the “CUSIP” numbers as they appear on any 2023 Bonds, notice or elsewhere, and any such notice may state that no representation is made as to the correctness of such numbers either as printed on the 2023 Bonds or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the 2023 Bonds, and any such redemption shall not be affected by any defect in or omission of such numbers. The City will promptly notify the Fiscal Agent in writing of any change in the “CUSIP” numbers.
(D) Maturities. The 2023 Bonds shall be issued as serial and term bonds, and shall mature and become payable as follows:

Maturity
(Sept. 1)
Principal
Amount
Interest
Rate
CUSIP†
(777870)
13 (E) Interest. The 2023 Bonds shall bear interest at the rates set forth above payable on the Interest Payment Dates in each year. Interest shall be calculated on the basis of a 360-day year composed of twelve 30-day months. Each 2023 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 Closing Date; provided, however, that if at the time of authentication of a 2023 Bond, interest is in default thereon, such 2023 Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon. (F) Method of Payment. Interest on the 2023 Bonds (including the final interest payment upon maturity or earlier redemption) is payable by check of the Fiscal Agent mailed on the Interest Payment Dates 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 Record Date preceding the Interest Payment 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 2023 Bonds; provided that so long as any 2023 Bonds are in book-entry form, payments with respect to such 2023 Bonds shall be made by wire transfer or such other method acceptable to the Fiscal Agent to the Depository. The principal of the 2023 Bonds and any premium on the 2023 Bonds are payable in lawful money of the United States of America upon surrender of the 2023 Bonds at the Principal Office of the Fiscal Agent.

All 2023 Bonds paid by the Fiscal Agent pursuant to this Section shall be cancelled by the Fiscal Agent. The Fiscal Agent shall dispose of the cancelled 2023 Bonds and issue a certificate of disposal thereof to the City at the written request of the City.

Section 2.03. Redemption.
(A) Redemption Dates.
(i) Optional Redemption. The 2023 Bonds may be redeemed prior to maturity at the option of the City from any source of available funds other than prepayment of the Special Tax by property owners, as a whole or in part, on any date on and after September 1, _____ at the following respective redemption prices (expressed as percentages of the principal amount of the 2023 Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Redemption Dates
Redemption
Price
September 1, ______ through August 31, ______ 103%
September 1, ______ through August 31, ______ 102
September 1, ______ through August 31, ______ 101
September 1, ______ and any date thereafter 100
14 (ii) Mandatory Redemption From Prepayments. The 2023 Bonds shall be subject to mandatory redemption from prepayments of the Special Tax by property owners on any Interest Payment Date, in whole or in part among maturities, and by lot within a maturity, and among the 2023 Bonds and any Additional Bonds, as shall be specified by the City, at the following respective redemption prices (expressed as percentages of the principal amount of the 2023 Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Redemption Dates
Redemption
Price
Interest Payment Dates through and including March 1, 2029 103% September 1, ______ and March 1, ______ 102
September 1, ______ and March 1, ______ 101
September 1, ______ and any Interest Payment Date thereafter 100 Prepayments and amounts released from the 2023 Reserve Account in connection with Prepayments will be allocated to the redemption of the 2023 Bonds and any Additional Bonds as nearly as practicable on a proportionate basis based on the outstanding principal amount of the 2023 Bonds and any Additional Bonds and shall be applied to redeem 2023 Bonds and Additional Bonds as nearly as practicable on a pro rata basis among maturities in increments of $5,000; provided, however, that, for Prepayments of less than $50,000, the City may specify in an Officer’s Certificate that Prepayments be applied to one or more maturities of the 2023 Bonds or Additional Bonds so long as there is delivered to the Fiscal Agent a Certificate of the Special Tax Consultant that, following such redemption from Prepayments, the maximum Special Taxes that may be levied in each Fiscal Year on Developed Parcels in Improvement Area No. 2 is not less than 110% of Maximum Annual Debt Service. (iii) Mandatory Sinking Fund Redemption. The Term 2023 Bonds maturing September 1, _______, September 1, _____ and September 1, _____ are subject to mandatory sinking payment redemption in part on September 1, _______, September 1, _____ and September 1, _____, respectively, and on each September 1 thereafter to maturity, by lot, at a redemption price equal to 100% of the principal amount thereof to be redeemed, without premium, in the aggregate respective principal amounts as set forth in the following tables:

Term 2023 Bonds Maturing September 1, _____
Mandatory
Redemption Date
(Sept. 1)
Sinking Fund
Payment
(maturity)
15 Term 2023 Bonds Maturing September 1, _____
Mandatory
Redemption Date
(Sept. 1)
Sinking Fund
Payment
(maturity)
Term 2023 Bonds Maturing September 1, _____
Mandatory
Redemption Date
(Sept. 1)
Sinking Fund
Payment
(maturity)
The amounts in the foregoing tables shall be reduced pro rata, at the direction of the City in an Officer’s Certificate, as a result of any prior partial optional or mandatory redemption of the Term 2023 Bonds pursuant to Section 2.03(A)(i) or (ii) above. In the event of a redemption pursuant to Section 2.03(A)(i) or (ii), the City shall provide the Fiscal Agent with a revised sinking fund schedule giving effect to the redemption so completed.

In lieu of redemption under this Section 2.03, moneys in the Bond Fund may be used and withdrawn by the Fiscal Agent for purchase of Outstanding 2023 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 2023 Bonds be purchased at a price in excess of the principal amount thereof, plus interest accrued to the date of purchase. (B) Notice to Fiscal Agent. The City shall give the Fiscal Agent an Officer’s Certificate containing notice of its intention to redeem 2023 Bonds pursuant to Section

2.03(A)(i) and (ii) not less than 60 days prior to the applicable redemption date. (C) Redemption Procedure by Fiscal Agent; Rescission. The Fiscal Agent shall, at the expense of the District, 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 2023 Bonds designated for redemption, at their addresses appearing on the 2023 Bond registration books in the Principal Office of the Fiscal Agent; but such mailing shall not be a condition precedent to such redemption and 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 2023 Bonds.

Such notice shall state the redemption date and the redemption price and, if less than all of the then Outstanding 2023 Bonds are to be called for redemption, shall designate the 16 CUSIP numbers and 2023 Bond numbers of the 2023 Bonds to be redeemed by giving the individual CUSIP number and 2023 Bond number of each 2023 Bond to be redeemed or shall state that all 2023 Bonds between two stated 2023 Bond numbers, both inclusive, are to be redeemed or that all of the 2023 Bonds of one or more maturities have been called for redemption, shall state as to any 2023 Bond called in part the principal amount thereof to be redeemed, and shall require that such 2023 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 2023 Bonds will not accrue from and after the redemption date.

Upon the payment of the redemption price of 2023 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, of the 2023 Bonds being redeemed with the proceeds of such check or other transfer.

The City has the right to rescind any notice of the redemption of 2023 Bonds under Section 2.03(A)(i) by written notice to the Fiscal Agent on or prior to two Business Days prior the date fixed for redemption. 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 2023 Bonds then called for redemption, and such cancellation shall not constitute an event of default. The City and the Fiscal Agent have no liability to the Owners or any other party related to or arising from such rescission of redemption. The Fiscal Agent, at the expense of the District, shall mail notice of such rescission of redemption in the same manner as the original notice of redemption was sent under this Section.

Whenever provision is made in this Agreement for the redemption of less than all of the 2023 Bonds of any maturity, the Fiscal Agent shall select the 2023 Bonds to be redeemed, from all 2023 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 2023 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 2023 Bond or 2023 Bonds, of the same series and maturity, of authorized denominations in an aggregate principal amount equal to the unredeemed portion of the 2023 Bond or 2023 Bonds.
(D) 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 2023 Bonds so called for redemption shall have been deposited in the Bond Fund, such 2023 Bonds so called shall cease to be entitled to any benefit under this 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.

All 2023 Bonds redeemed and purchased by the Fiscal Agent pursuant to this Section shall be canceled by the Fiscal Agent. The Fiscal Agent shall dispose of the cancelled 2023 Bonds in accordance with its then-customary procedures and issue a certificate of disposal thereof to the City at the City’s written request.

Section 2.04. Form of Bonds. The 2023 Bonds, the form of Fiscal Agent’s certificate of authentication and the form of assignment, to appear thereon, shall be substantially in the forms, respectively, set forth in Exhibit A attached hereto and by this reference incorporated 17 herein, with necessary or appropriate variations, omissions and insertions, as permitted or required by this Agreement, the Resolution and the Act.

Section 2.05. Execution of Bonds. The Bonds shall be executed on behalf of the City by the Mayor and the City Clerk of the City who are in office on the date of adoption of this Agreement or at any time thereafter, and the seal of the City may be impressed, imprinted or reproduced by facsimile signature thereon. If any officer whose signature appears on any Bond ceases to be such officer before delivery of the Bonds to the Owner, such signature shall nevertheless be as effective as if the officer had remained in office until the delivery of the Bonds to the Owner. Any Bond may be signed and attested on behalf of the City by such persons as at the actual date of the execution of such Bond shall be the proper officers of the City although at the nominal date of such Bond any such person shall not have been such officer of the City.

Only such Bonds as shall bear thereon a certificate of authentication in substantially the form set forth in Exhibit A, executed and dated manually or electronically by the Fiscal Agent, shall be valid or obligatory for any purpose or entitled to the benefits of this Agreement, and such certificate of authentication of the Fiscal Agent shall be conclusive evidence that the Bonds registered hereunder have been duly authenticated, registered and delivered hereunder and are entitled to the benefits of this Agreement.

Section 2.06. Transfer of Bonds. Any Bond may, in accordance with its terms, be transferred, upon the books required to be kept pursuant to the provisions of Section 2.08 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 acceptable to the Fiscal Agent. The cost for any services rendered or any fees or expenses incurred by the Fiscal Agent in connection with any such transfer shall 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.

The Fiscal Agent shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Agreement or under applicable law with respect to any transfer of any interest in any Bond (including any transfers between or among DTC Participants or Beneficial Owners of interests in any Bond) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by the terms of, this Agreement, and to examine the same to determine substantial compliance as to form with the express requirements hereof.

Neither the Fiscal Agent nor any agent shall have any responsibility or liability for any actions taken or not taken by the Securities Depository.

Whenever any Bond or Bonds shall be surrendered for transfer, 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.

No transfers 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.

Prior to any transfer of Bonds outside the book-entry system (including, but not limited to, the initial transfer outside the book-entry system), the transferor shall provide or cause to be provided to the Fiscal Agent all information necessary to allow the Fiscal Agent to comply with 18 any applicable tax reporting obligations, including without limitation any cost basis reporting obligations under Internal Revenue Code Section 6045, as amended. The Fiscal Agent shall conclusively rely on the information provided to it and shall have no responsibility to verify or ensure the accuracy of such information.

Section 2.07. Exchange of Bonds. Bonds may be exchanged at the Principal Office of the Fiscal Agent for a like aggregate principal amount of Bonds of authorized denominations and of the same maturity. The cost for any services rendered or any fees or expenses incurred by the Fiscal Agent in connection with any such exchange shall be paid by the City. The Fiscal Agent shall collect from the Owner requesting such exchange any tax or other governmental charge required to be paid with respect to such exchange.

No 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.

Section 2.08. Bond Register. The Fiscal Agent will keep or cause to be kept, at its Principal Office, sufficient books for the registration and transfer of the Bonds (the “Bond Register”), which books shall show the series number, date, amount, rate of interest and Owner of each Bond and shall at all times be open to inspection by the City during regular business hours upon reasonable notice; and, upon presentation for such purpose, the Fiscal Agent shall, under such reasonable regulations as it may prescribe, register or transfer or cause to be registered or transferred, on said books, the ownership of the Bonds as hereinbefore provided.

Section 2.09. Temporary Bonds. The Bonds may be initially issued in temporary form exchangeable for definitive Bonds when ready for delivery. The temporary Bonds may be printed, lithographed or typewritten, shall be of such denominations as may be determined by the City, and may contain such reference to any of the provisions of this Agreement as may be appropriate. Every temporary Bond shall be executed by the City upon the same conditions and in substantially the same manner as the definitive Bonds. If the City issues temporary Bonds it will execute and furnish definitive Bonds without delay and thereupon the temporary Bonds shall be surrendered, for cancellation, in exchange for the definitive Bonds at the Principal Office of the Fiscal Agent or at such other location as the Fiscal Agent shall designate, and the Fiscal Agent shall authenticate and deliver in exchange for such temporary Bonds an equal aggregate principal amount of definitive Bonds of authorized denominations. Until so exchanged, the temporary bonds shall be entitled to the same benefits under this Agreement as definitive Bonds authenticated and delivered hereunder.

Section 2.10. Bonds Mutilated, Lost, Destroyed or Stolen. If any Bond shall become mutilated, the City shall execute, and the Fiscal Agent shall authenticate and deliver, a new Bond of like tenor and principal amount in exchange and substitution for the Bond so mutilated, but only upon surrender to the Fiscal Agent of the Bond so mutilated. Every mutilated Bond so surrendered to the Fiscal Agent shall be canceled by it and disposed of by the Fiscal Agent in accordance with its then-customary procedures and shall deliver a certificate of disposal thereof to the City at its written request. If any Bond shall be lost, destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the Fiscal Agent and, if such evidence be satisfactory to it and indemnity for the Fiscal Agent and the City satisfactory to the Fiscal Agent shall be given, the City shall execute, and the Fiscal Agent shall authenticate and deliver, a new Bond of like tenor and principal amount in lieu of and in substitution for the Bond so lost, destroyed or stolen. The City or Fiscal Agent, as applicable, may require payment of a sum not exceeding the actual cost of preparing each new Bond delivered under this Section and of the 19 fees and expenses which may be incurred by the City and the Fiscal Agent for the preparation, execution, authentication and delivery. Any Bond delivered under the provisions of this Section in lieu of any Bond alleged to be lost, destroyed or stolen shall constitute an original additional contractual obligation on the part of the City whether or not the Bond so alleged to be lost, destroyed or stolen is at any time enforceable by anyone, and shall be equally and proportionately entitled to the benefits of this Agreement with all other Bonds issued pursuant to this Agreement.

Section 2.11. Limited Obligation. All obligations of the City under this Agreement and the Bonds shall be special obligations of the City, payable solely from the Special Tax Revenues and the funds pledged therefore hereunder. Neither the full faith and credit nor the taxing power of the City (except to the limited extent set forth herein) or the State of California or any political subdivision thereof is pledged to the payment of the Bonds.

Section 2.12. Book-Entry Only System. DTC shall act as the initial Depository for the Bonds. One Bond for each maturity of the Bonds shall be initially executed, authenticated, and delivered as set forth herein as a separate fully registered certificate (in printed or typewritten form). Upon initial execution, authentication, and delivery, the ownership of the Bonds shall be registered in the Bond Register kept by the Fiscal Agent for the Bonds in the name of Cede & Co, as nominee of DTC or such nominee as DTC shall appoint in writing.

The Authorized Officers and the Fiscal Agent are hereby authorized to take any and all actions as may be necessary and not inconsistent with this Agreement to qualify the Bonds for the Depository’s book-entry system, including the execution of the Depository’s required representation letter.

With respect to Bonds registered in the Bond Register in the name of Cede & Co, as nominee of DTC, the Fiscal Agent shall not have any responsibility or obligation to any broker-dealer, bank, or other financial institution for which DTC holds Bonds as Depository from time to time (the “DTC Participants”) or to any person for which a DTC Participant acquires an interest in the Bonds (the “Beneficial Owners”). Without limiting the immediately preceding sentence, the Fiscal Agent shall not have any responsibility or obligation with respect to (i) the accuracy of the records of DTC, Cede & Co, or any DTC Participant with respect to any ownership interest in the Bonds, (ii) the delivery to any DTC Participant, any Beneficial Owner, or any other person, other than DTC, of any notice with respect to the Bonds, including any notice of redemption or mandatory tender, (iii) the selection by the Depository of the beneficial interests in the Bonds to be redeemed in the event the City elects to redeem the Bonds in part, (iv) the payment to any DTC Participant, any Beneficial Owner, or any other person, other than DTC, of any amount with respect to the principal of or interest on the Bonds, or (v) any consent given or other action taken by the Depository as Owner of the Bonds.

The Fiscal Agent may treat as and deem DTC to be the absolute Owner of each Bond for which DTC is acting as Depository for the purpose of payment of the principal of and interest on such Bonds, for the purpose of giving notices of prepayment and other matters with respect to such Bonds, for the purpose of registering transfers with respect to such Bonds, and for all purposes whatsoever. The Fiscal Agent shall pay all principal of and interest on the Bonds only to the Owners as shown on the registration books, and all such payments shall be valid and effective to fully satisfy and discharge all obligations with respect to the principal of and interest on the Bonds to the extent of the sums or sums so paid. 20 No person other than an Owner, as shown on the Bond Register, shall receive a physical Bond. Upon delivery by DTC to the Fiscal Agent of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., and subject to the transfer provisions in Section 2.06 hereof, references to “Cede & Co.” in this Section 2.12 shall refer to such new nominee of DTC.

DTC may determine to discontinue providing its services with respect to the Bonds at any time by giving written notice to the Fiscal Agent and the City during any time that the Bonds are Outstanding, and discharging its responsibilities with respect thereto under applicable law. The City may terminate the services of DTC with respect to the Bonds if it determines that DTC is unable to discharge its responsibilities with respect to the Bonds or that continuation of the system of book-entry transfers through DTC is not in the best interest of the Beneficial Owners, and the City shall promptly mail notice of such termination to the Fiscal Agent.

Upon the termination of the services of DTC as provided in the previous paragraph, and if no substitute Depository willing to undertake the functions hereunder can be found which is willing and able to undertake such functions upon reasonable or customary terms, or if the City determines that it is in the best interest of the Beneficial Owners of the Bonds that they be able to obtain certificated Bonds, the Bonds shall no longer be restricted to being registered in the Bond Register of the Fiscal Agent in the name of Cede & Co., as nominee of DTC, but may be registered in whatever name or names the Owners shall designate at that time, in accordance with Section 2.06.

To the extent that the Beneficial Owners are designated as the transferee by the Owners, in accordance with Section 2.06, the Bonds will be delivered to such Beneficial Owners as soon as practicable.

Section 2.13. No Acceleration. The principal of the Bonds shall not be subject to acceleration hereunder. Nothing in this Section 2.13 shall in any way prohibit the prepayment or redemption of Bonds under Section 2.03 hereof, or the defeasance of the Bonds and discharge of this Agreement under Section 9.03 hereof.
21 ARTICLE III

ISSUANCE OF BONDS
Section 3.01. Issuance and Delivery of Bonds. At any time after the execution of this Agreement, the City may issue the Bonds for the District in the aggregate principal amount set forth in Section 2.01 (with respect to the 2023 Bonds) or as authorized in any Supplemental Agreement (with respect to any Additional Bonds) and deliver such Bonds to the Original Purchaser. The Authorized Officers of the City are hereby authorized and directed to deliver any and all documents and instruments necessary to cause the issuance of Bonds in accordance with the provisions of the Act, the Resolution and this Agreement, to authorize the payment of Costs of Issuance of the Bonds from the proceeds of the Bonds and to do and cause to be done any and all acts and things necessary or convenient for delivery of the Bonds to the Original Purchaser.

Section 3.02. Application of Proceeds of Sale of 2023 Bonds. (A) The proceeds of the purchase of the 2023 Bonds by the Original Purchaser in the amount of $__________ (which is equal to the par amount of the 2023 Bonds, plus/less [net] original issue premium/discount of $__________ and less the Participating Underwriter’s discount of $__________), shall be paid to the Fiscal Agent, who shall forthwith set aside, pay over and deposit such proceeds on the Closing Date as follows:
(ii) Deposit in the 2023 Reserve Account of the Reserve Fund $__________, equaling the initial amount of the Reserve Requirement for the 2023 Bonds;
(ii) Deposit in the Improvement Fund $__________;
(iii) Deposit in the 2023 Capitalized Interest Account of the Bond Fund $__________ to pay interest on the 2023 Bonds through September 1, 2023; and
(iv) Deposit in the Costs of Issuance Fund $__________. (B) The Fiscal Agent may establish such temporary funds and accounts as is necessary to accomplish the purposes of Section 3.02(A).

Section 3.03. Special Tax Fund.
(A) Establishment of Special Tax Fund. There is hereby established as a separate fund to be held by the Chief Financial Officer, the Creekview Community Facilities District No. 1 (Public Facilities) Improvement Area No. 2 Special Tax Bonds Special Tax Fund, to the credit of which the City shall deposit, immediately upon receipt, all Special Tax Revenues received by the City (other than as a result of Prepayments) and any other amounts required hereunder to be deposited in the Special Tax Fund, and within such fund, a Surplus Account, to the credit of which the City shall deposit surplus Special Tax Revenues described in Section 3.03(B) below. Moneys in the Special Tax Fund shall be held in trust by the City for the benefit of the City and the Owners of the Bonds, shall be disbursed as provided below and, pending any disbursement, shall be subject to a lien in favor of the Owners of the Bonds. 22 (B) Disbursements. As soon as practicable after the receipt by the City of any Special Tax Revenues, other than as a result of Prepayments, or the transfer of amounts to the Special Tax Fund pursuant to the terms hereof, but no later than 10 Business Days after such receipt or transfer, the Chief Financial Officer shall withdraw from the Special Tax Fund and transfer to the Fiscal Agent for deposit: (i) 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, premium, if any, and interest due on the Bonds during the thencurrent Bond Year; (ii) in the Reserve Fund, an amount, taking into account amounts then on deposit in each reserve account within the Reserve Fund, so that the amount in the reserve accounts of the Reserve Fund equals the Reserve Requirement with respect to each series of Bonds. After the transfers under subsections (i) and (ii) have been made, the City may, on or after September 2nd of each year transfer to the Surplus Account the amount remaining in the Special Tax Fund, whereupon such moneys transferred shall be free of the pledge for payment of the Bonds.

From time to time, the City may withdraw from the Surplus Account of the Special Tax Fund amounts needed to pay Administrative Costs, costs of the Project or incidental expenses of the District authorized under the Act and the Acquisition Agreement. Moneys in the Surplus Account may, at the City’s discretion, also be used 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 Requirement.
(C) Investment. Moneys in the Special Tax Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits resulting from such investment and deposit shall be retained in the Special Tax Fund to be used for the purposes thereof.

Section 3.04. Improvement Fund.
(A) Establishment of Improvement Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, the Creekview Community Facilities District No. 1 (Public Facilities) Improvement Area No. 2 Special Tax Bonds Improvement Fund, to the credit of which a deposit shall be made as required by Section 3.02. Moneys in the Improvement Fund shall be held in trust and shall be disbursed as provided in subsection (B) of this Section for the payment or reimbursement of costs of the Project. Each such Officer’s Certificate shall be sufficient evidence to the Fiscal Agent of the facts stated therein and the Fiscal Agent shall have no duty to confirm the accuracy of such facts. The City shall determine in good faith whether an architect or engineer is required to execute any disbursement hereunder, and the Fiscal Agent shall in no instance be required to make such determination. For purposes of complying with the requirements of Section 3, the Fiscal Agent may conclusively rely and shall be protected in acting or refraining from acting upon the Officer’s Certificate signed by an Authorized Officer. The Fiscal Agent shall not be bound to make an investigation into the facts or matters stated in any such Officer’s Certificate of the City. The Fiscal Agent shall not be responsible for determining whether the funds on hand in the Improvement Fund are sufficient to complete the Project. The Fiscal Agent shall not be responsible to collect lien waivers. (B) Procedure for Disbursement. Disbursements from the Improvement Fund shall be made by the Fiscal Agent upon receipt of an Officer’s Certificate substantially in the form of Exhibit B attached hereto which shall:
(i) set forth the amount required to be disbursed, the purpose for which the disbursement is to be made, the person to which the disbursement is to 23 be paid and state that such disbursement is for a Project cost; and (ii) certify that no portion of the amount then being requested to be disbursed was set forth in any Officers Certificate previously filed requesting disbursement.

Each such Officer’s Certificate shall be sufficient evidence to the Fiscal Agent of the facts stated therein and the Fiscal Agent shall have no duty to confirm the accuracy of such facts.
(C) Investment. Moneys in the Improvement Fund and the accounts established thereunder shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits from the investment of amounts in the Improvement Fund shall be retained by the Fiscal Agent in the Improvement Fund to be used for the purposes of the Improvement Fund. (D) Closing of Fund. Upon the filing of an Officer’s Certificate stating that the portion of the Project to be financed from the Improvement Fund and the accounts established thereunder has been completed and that all costs of such portion of the Project and all Administrative Expenses of the District have been paid, the Fiscal Agent shall transfer the amount, if any, remaining in the Improvement Fund to the Bond Fund for application to the payment of principal of and interest on the Bonds in accordance with Section 4.02 and the Improvement Fund shall be closed. At least 30 days prior to closing the Improvement Fund, the City shall notify the Developer at the address for notices set forth in the Acquisition Agreement of its intention to do so.

Section 3.05. Costs of Issuance Fund.
(A) Establishment of Costs of Issuance Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, the Creekview Community Facilities District No. 1 (Public Facilities) Improvement Area No. 2 Special Tax Bonds Costs of Issuance Fund, to the credit of which a deposit shall be made as required by Section 3.02. Moneys in the Costs of Issuance Fund shall be held in trust by the Fiscal Agent and shall be disbursed as provided in subsection (B) of this Section for the payment or reimbursement of Costs of Issuance of the 2023 Bonds.
(B) Disbursement. Amounts in the Costs of Issuance Fund shall be disbursed from time to time to pay Costs of Issuance, as set forth in an Officer’s Certificate containing respective amounts to be paid to the designated payees, signed by an Authorized Officer or a designee thereof and delivered to the Fiscal Agent. The Fiscal Agent shall pay all Costs of Issuance of the Bonds upon receipt of an invoice from any such payee which requests payment in an amount which is less than or equal to the amount set forth with respect to such payee in such Officer’s Certificate, or upon receipt of an Officer’s Certificate requesting payment of a Cost of Issuance not listed on the initial Officer’s Certificate delivered to the Fiscal Agent on the Closing Date of the Bonds. Each such Officer’s Certificate shall be sufficient evidence to the Fiscal Agent of the facts stated therein and the Fiscal Agent shall have no duty to confirm the accuracy of such facts. With respect to each such Officer’s Certificate, the City certifies that it has reviewed any wire instructions set forth in such written disbursement direction to confirm such wire instructions are accurate. The Fiscal Agent shall maintain the Costs of Issuance Fund for a period of 6 months from the Closing Date of the Bonds and then shall transfer any moneys remaining therein, including any investment earnings thereon, to the Bond Fund for payment of debt service on the 2023 Bonds. Thereafter, every invoice received 24 by the Fiscal Agent shall be submitted to the Chief Financial Officer for payment from amounts on deposit in the Special Tax Fund.
(C) Investment. Moneys in the Costs of Issuance Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits resulting from said investment shall be retained by the Fiscal Agent in the Costs of Issuance Fund to be used for the purposes of such fund.
25 ARTICLE IV
SPECIAL TAX REVENUES; BOND FUND AND RESERVE FUND
Section 4.01. Pledge of Special Tax Revenues and Other Amounts. All of the Special Tax Revenues and all moneys deposited in the Bond Fund and, until disbursed as provided herein, in the Special Tax Fund are hereby pledged to secure the repayment of the Bonds. In addition, the 2023 Bonds shall be secured by a pledge and lien on the 2023 Reserve Account of the Reserve Fund, and each Series of Additional Bonds shall be secured by a separate reserve account established within the Reserve Fund as set forth in a Supplemental Agreement. Such pledge shall constitute a first lien on the Special Tax Revenues and said amounts. The Special Tax Revenues and all moneys deposited into such funds (except as otherwise provided herein) are hereby dedicated in their entirety to the payment of the principal of, including any mandatory sinking fund payments, and interest and any premium on, the Bonds as provided herein and in the Act until all of the Bonds have been paid and retired or until moneys or Federal Securities have been set aside irrevocably for that purpose in accordance with Section 9.03.

Amounts in the Improvement Fund and in the Costs of Issuance Fund for any series of Bonds are not pledged to the repayment of the Bonds. The facilities acquired with the proceeds of the Bonds are not in any way pledged to pay the Debt Service on the Bonds. Any proceeds of condemnation, destruction or other disposition of any facilities financed with the proceeds of the Bonds are not pledged to pay the Debt Service on the Bonds and are free and clear of any lien or obligation imposed hereunder.

Section 4.02. Bond Fund.
(A) Establishment of Bond Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, the Creekview Community Facilities District No. 1 (Public Facilities) Improvement Area No. 2 Special Tax Bonds Bond Fund, to the credit of which deposits shall be made as required by Section 3.02, Section 3.03(B), Section 4.03 and any other amounts required to be deposited therein by this Agreement or the Act. Moneys in the Bond Fund shall be held in trust by the Fiscal Agent for the benefit of the Owners of the Bonds, shall be disbursed for the payment of the principal of, and interest and any premium on, the Bonds as provided below, and, pending such disbursement, shall be subject to a lien in favor of the Owners of the Bonds.

Within the Bond Fund there is hereby established the Prepayment Account, which shall be used exclusively for the administration of any prepayments of Special Taxes to assure the timely redemption of Bonds. Monies in the Prepayment Account shall be used to redeem Bonds on the redemption date specified in the notice to the Fiscal Agent given pursuant to Section 2.03(B). In the event all of the Special Taxes are prepaid in full, the Prepayment Account shall be closed.

There is also hereby created within the Bond Fund a “2023 Capitalized Interest Account” which account is hereby established for purposes of accounting for the disposition of 2023 Bonds, a portion of the proceeds of which will be deposited to such 2023 Capitalized Interest Account pursuant to Section 3.02(A). The amount deposited to the 2023 Capitalized Interest Account and any investment earnings thereon shall be used solely to make payments on the 2023 Bonds, and the amount deposited to the 2023 Capitalized Interest Account and any investment earnings thereon shall be applied solely to make payments on the 2023 Bonds 26 through and including September 1, 2023. Any excess amounts therein on September 2, 2023 shall be transferred to the Bond Fund, and the 2023 Capitalized Interest Account shall thereupon be closed.
(B) Disbursements. On each Interest Payment Date, the Fiscal Agent shall withdraw from the Bond Fund and pay to the Owners of the Bonds the principal of, and interest and any premium, then due and payable on the Bonds, including any amounts due on the Bonds by reason of the sinking payments set forth in Section 2.03(A)(iii) or any redemption of the Bonds under Section 2.03(A)(i). Amounts in the 2023 Capitalized Interest Account of the Bond Fund shall be drawn on before any other amounts in the Bond Fund.

In the event that amounts in the Bond Fund are insufficient to pay regularly scheduled payments of principal of and interest on any series of Bonds, the Fiscal Agent shall withdraw from the respective reserve account within the Reserve Fund established for such series of Bonds to the extent of any funds therein, the amount of such insufficiency, and the Fiscal Agent shall provide written notice to the Chief Financial Officer of the amounts so withdrawn from the Reserve Fund. Amounts so withdrawn from the Reserve Fund shall be deposited in the Bond Fund.

If, after the foregoing transfer, there are insufficient funds in the Bond Fund to make the payments provided for to pay regularly scheduled payments of principal of and interest on the Bonds, the Fiscal Agent shall apply the available funds first to the payment of interest on the Bonds, then to the payment of principal due on the Bonds other than by reason of sinking payments, and then to payment of principal due on the Bonds by reason of sinking payments.

Any sinking payment not made as scheduled shall be added to the sinking payment to be made on the next sinking payment date.
(C) Investment. Moneys in the Bond Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits resulting from such investment and deposit shall be retained in the Bond Fund to be used for the purposes of such fund. (D) Deficiency. If 10 days before any Interest Payment Date it appears to the Fiscal Agent that there is a danger of deficiency in the Bond Fund and that the Fiscal Agent may be unable to pay regularly scheduled debt service on the Bonds in a timely manner, the Fiscal Agent shall report to the Chief Financial Officer such fact. The City covenants to increase the levy of the Special Taxes in the next Fiscal Year (subject to the maximum amount authorized by the Special Tax Formula) in accordance with the procedures set forth in the Act for the purpose of curing Bond Fund deficiencies.

If on any Interest Payment Date the Fiscal Agent is unable to pay principal, interest and premium, if any, due on any Interest Payment Date for the Bonds due to insufficient funds in the Bond Fund, or if funds are withdrawn from the Reserve Fund to pay principal and/or interest on the Bonds the Fiscal Agent shall notify the Chief Financial Officer in writing of such fact, and the Chief Financial Officer shall notify CDIAC of such fact within 10 days of such Interest Payment Date. The Fiscal Agent has no obligation under this Agreement to provide notice or disclosure to the Bondowners of insufficient funds or anticipation of deficiency in the Bond Fund.
27 Section 4.03. Reserve Fund.
(A) Establishment of Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, the Creekview Community Facilities District No. 1 (Public Facilities) Improvement Area No. 2 Special Tax Bonds Reserve Fund, and within the Reserve Fund shall be established a “2023 Reserve Account,” to the credit of which a deposit shall be made as required by Section 3.02 and deposits shall be made as provided in Section 3.03(B). For each series of Additional Bonds, the Fiscal Agent shall establish a separate subaccount within the Reserve Fund for such series and moneys in each subaccount shall be held in trust by the Fiscal Agent for the benefit of the Owners of the respective series of Bonds.

The City has the right to either meet the Reserve Requirement at the time of issuance of a series of Bonds or at any time thereafter to cause the Fiscal Agent to release cash from the Reserve Fund, in whole or in part, by tendering to the Fiscal Agent: (1) a Qualified Reserve Fund Credit Instrument, and (2) in the case of a release, an opinion of Bond Counsel stating that such release will not, of itself, cause the portion of the interest on the Bonds secured thereby to become includable in gross income for purposes of federal income taxation. Upon tender of such items to the Fiscal Agent in connection with a release of cash, the Fiscal Agent will transfer such funds to the City. Prior to the expiration of any Qualified Reserve Fund Credit Instrument, if applicable, the City is obligated either to replace such Qualified Reserve Fund Credit Instrument with a new Qualified Reserve Fund Credit Instrument, or to deposit or cause to be deposited with the Fiscal Agent an amount of funds such that the funds on deposit in the Reserve Fund together with all Qualified Reserve Fund Credit Instruments held by the Fiscal Agent is at least equal to the Reserve Requirement (which funds may come from a draw by the Fiscal Agent on the Qualified Reserve Fund Credit Instrument prior to its expiration). (B) Use of Fund. Except as otherwise provided in this Section, all amounts deposited in a reserve account of the Reserve Fund shall 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 within five days prior to any Interest Payment Date in the Bond Fund of the amount required for payment of the principal of, and interest on, the respective series of Bonds on such Interest Payment Date. Whenever transfer is made from the Reserve Fund to the Bond Fund due to a deficiency in the Bond Fund, the Fiscal Agent shall provide written notice thereof to the Chief Financial Officer.
(C) Transfer of Excess of Reserve Requirement. Whenever, on the Business Day prior to any Interest Payment Date, the amount in any reserve account within the Reserve Fund exceeds the Reserve Requirement for the applicable series of Bonds covered by such reserve account (it being understood the City calculates the Reserve Requirement in accordance with the definition thereof), the Fiscal Agent shall provide written notice to the Chief Financial Officer of the amount of the excess. The Chief Financial Officer shall advise the Fiscal Agent in writing of the amount, if any, of any transfer required pursuant to Section 4.03(D) and 6.02 below, and otherwise direct the Fiscal Agent to transfer an amount equal to the excess to the Improvement Fund, if the Project has not been completed as of the date of such transfer, or if the Project has been completed, to the Bond Fund to be used for the payment of the principal of and interest on the Outstanding Bonds covered by the applicable reserve account in accordance with Section 4.02; provided, that to the extent that such excess results from the prepayment of Special Taxes and redemption of Bonds as provided in an Officer’s Certificate in accordance with Section 2.03(B), such amount shall be transferred to the Prepayment Account and applied to the corresponding redemption of Bonds. 28 (D) Transfer for Rebate Purposes. 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 Section 6.02.
(E) Transfer When Balance Exceeds Outstanding Bonds. Whenever the balance in a reserve account of the Reserve Fund exceeds the amount required to redeem or pay the Outstanding Bonds covered by such reserve account, including interest accrued to the date of payment or redemption and premium, if any, due upon redemption, and after making any transfer required under Section 4.03(D) above and upon receipt of an Officer’s Certificate directing it to do so, the Fiscal Agent shall transfer the amount in the applicable reserve account of the Reserve Fund to the Bond Fund to be applied, on the next succeeding Interest Payment Date to the payment and redemption, in accordance with Section 4.02 or 2.03 as applicable, of all such Outstanding Bonds. In the event that the amount so transferred to the Bond Fund exceeds the amount required to pay and redeem the Outstanding Bonds covered by the applicable reserve account, the balance in such reserve account shall be transferred to the City, after payment of any amounts due the Fiscal Agent hereunder, to be used for any lawful purpose of the City.

Notwithstanding the foregoing, no amounts shall be transferred from a reserve account of the Reserve Fund pursuant to this Section 4.03(E) until after the calculation, pursuant to Section 6.02, of any amounts due to the federal government following payment of the respective series of Bonds and withdrawal of any such amount under Section 4.03(D) for purposes of making such payment to the federal government, and payment of any fees and expenses due to the Fiscal Agent.
(F) Investment. Moneys in each reserve account of the Reserve Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits resulting from such investment and deposit shall be retained in the applicable reserve account of the Reserve Fund to be used and disbursed as provided in this Section 4.03. 29 ARTICLE V

OTHER COVENANTS OF THE CITY
Section 5.01. Punctual Payment. The City will punctually pay or cause to be paid the principal of, and interest and any premium on, the Bonds when and as due in strict conformity with the terms of this Agreement, and it will faithfully observe and perform all of the conditions covenants and requirements of this Agreement and all Supplemental Agreements and of the Bonds.

Section 5.02. Limited Obligation. The Bonds are limited obligations of the City on behalf of the District and are payable solely from and secured solely by the Special Tax Revenues and the amounts in certain funds created hereunder as, and to the extent, set forth in Section 4.01.

Section 5.03. Extension of Time for Payment. In order to prevent any accumulation of claims for interest after maturity, the City shall not, directly or indirectly, extend or consent to the extension of the time for the payment of any claim for interest on any of the Bonds and shall not, directly or indirectly, be a party to the approval of any such arrangement by purchasing or funding said claims for interest or in any other manner. In case any such claim for interest shall be extended or funded, whether or not with the consent of the City, such claim for interest so extended or funded shall not be entitled, in case of default hereunder, to the benefits of this Agreement, except subject to the prior payment in full of the principal of all of the Bonds then Outstanding and of all claims for interest which shall not have been so extended or funded.

Section 5.04. Against Encumbrances. The City will not encumber, pledge or place any charge or lien upon any of the Special Tax Revenues or other amounts pledged to the Bonds superior to or on a parity with the pledge and lien herein created for the benefit of the Bonds, except as permitted by this Agreement.

Section 5.05. Books and Accounts. The City will keep, or cause to be kept, proper books of record and accounts, separate from all other records and accounts of the City, in which complete and correct entries shall be made of all transactions relating to the expenditure of amounts disbursed from the Special Tax Fund and to the Special Tax Revenues. Such books of record and accounts shall at all times during business hours be subject to the inspection of the Fiscal Agent and the Owners of not less than 10% of the principal amount of the Bonds then Outstanding, or their representatives duly authorized in writing.

The Fiscal Agent will keep, or cause to be kept, proper books of record and accounts, separate from all other records and accounts of the Fiscal Agent, in which complete and correct entries shall be made of all transactions relating to the expenditure of amounts disbursed from the Bond Fund, the Reserve Fund, the Improvement Fund and the Costs of Issuance Fund.

Such books of record and accounts shall at all times during business hours and upon reasonable prior notice, be subject to the inspection of the City and the Owners of not less than 10% of the principal amount of the Bonds then Outstanding, or their representatives duly authorized in writing.

The Fiscal Agent may establish and maintain for so long as is necessary one or more temporary funds and accounts under this Agreement.

Section 5.06. Protection of Security and Rights of Owners. The City will preserve and protect the security of the Bonds and the rights of the Owners, and will warrant and defend their 30 rights against all claims and demands of all persons. From and after the delivery of any of the Bonds by the City, the Bonds shall be incontestable by the City.

Section 5.07. Compliance with Law; Completion of Project. The City will comply with all applicable provisions of the Act and the law in completing the acquisition and construction of the Project; provided that the City shall have no obligation to advance any funds to complete the Project in excess of the amounts available therefor in the Improvement Fund.

Section 5.08. Private Activity Bond Limitation. The City shall assure that the proceeds of the 2023 Bonds are not so used as to cause the 2023 Bonds to satisfy the private business tests of Section 141(b) of the Code or the private loan financing test of Section 141(c) of the Code.

Section 5.09. Federal Guarantee Prohibition. The City shall not take any action or permit or suffer any action to be taken if the result of the same would be to cause any of the 2023 Bonds to be “federally guaranteed” within the meaning of Section 149(b) of the Code.

Section 5.10. Collection of Special Tax Revenues. The City shall comply with all requirements of the Act so as to assure the timely collection of Special Tax Revenues, including without limitation, the enforcement of delinquent Special Taxes.

On or within five (5) Business Days of each June 1, the Fiscal Agent shall provide the Chief Financial Officer with a notice stating the amount then on deposit in the Bond Fund and the reserve accounts of the Reserve Fund. The receipt of such notice by the Chief Financial Officer shall in no way affect the obligations of the Chief Financial Officer under the following two paragraphs. Upon receipt of such notice, the Chief Financial Officer shall ascertain the relevant parcels on which the Special Taxes are to be levied, taking into account any parcel splits during the preceding and then current year.

The City shall effect the levy of the Special Taxes each Fiscal Year in accordance with the Ordinance such that the computation of the levy is complete before the final date on which the County Auditor will accept the transmission of the Special Tax amounts for the parcels within Improvement Area No. 2 for inclusion on the next secured real property tax roll. Upon the completion of the computation of the amounts of the levy, the City shall prepare or cause to be prepared, and shall transmit to the Chief Financial Officer, such data as the County Auditor requires to include the levy of the Special Taxes on the next secured real property tax roll.

The City shall fix and levy the amount of Special Taxes within Improvement Area No. 2 required for the payment of principal of and interest on any outstanding Bonds secured by the Special Tax Revenues becoming due and payable during the ensuing Bond Year, including any necessary replenishment or expenditure of amounts in the Reserve Fund and an amount estimated to be sufficient to pay the Administrative Expenses during such year, all in accordance with the Special Tax Formula and the Ordinance. In any event, the Special Taxes so levied shall not exceed the authorized amounts as provided in the proceedings pursuant to the Special Tax Formula.

The Special Taxes shall be payable and be collected in the same manner and at the same time and in the same installment as the general taxes on real property are payable, and have the same priority, become delinquent at the same times and in the same proportionate amounts and bear the same proportionate penalties and interest after delinquency as do the general taxes on real property. Notwithstanding the foregoing, the Special Taxes may be 31 collected in such other manner as the City shall prescribe if necessary to pay the debt service on the Bonds.

Section 5.11. Further Assurances. The City will adopt, make, execute and deliver any and all such further resolutions, instruments and assurances as may be reasonably necessary or proper to carry out the intention or to facilitate the performance of this Agreement, and for the better assuring and confirming unto the Owners of the rights and benefits provided in this Agreement.

Section 5.12. No Arbitrage. The City shall not take, or permit or suffer to be taken by the Fiscal Agent or otherwise, any action with respect to the gross proceeds of the Bonds which if such action had been reasonably expected to have been taken, or had been deliberately and intentionally taken, on the Closing Date would have caused the Bonds to be “arbitrage bonds” within the meaning of Section 148 of the Code and Regulations.

Section 5.13. Maintenance of Tax-Exemption. The City shall take all actions necessary to assure the exclusion of interest on the Bonds from the gross income of the Owners of the Bonds to the same extent as such interest is permitted to be excluded from gross income under the Code as in effect on the date of issuance of the Bonds.

Section 5.14. Annual State Reports. The following requirements shall apply to the Bonds:
(A) Annual Reporting. Not later than October 30 of each calendar year, beginning with the October 30 first succeeding the date of the Bonds, and in each calendar year thereafter until the October 30 following the final maturity of the Bonds, the City shall prepare and supply the California Debt and Investment Advisory Commission (“CDIAC”), by mail, postage prepaid, with the information required under Section 53359.5(b) of the Act. Not later than January 1 of the year following issuance of the Bonds, and at least once a year thereafter, the Chief Financial Officer shall file a report with the City Council in accordance with the requirements of Government Code Section 53411, which report shall contain: (a) the amount of Special Taxes collected and expended; and (b) if applicable, the status of the Project. In addition, no later than seven months after the end of the City’s fiscal year, the City shall prepare and supply to CDIAC the information required by Section 8855(k) of the Government Code. The annual reporting shall be made using such form or forms as may be prescribed by CDIAC.
(B) Other Reporting. If at any time the Fiscal Agent fails to pay principal and interest due on any scheduled payment date for the Bonds, or if funds are withdrawn from the Reserve Fund to pay principal and interest on the Bonds, the Fiscal Agent shall notify the Chief Financial Officer of such failure or withdrawal in writing. An official of the City shall notify CDIAC pursuant to Government Code Section 53359.5(c) within 10 days of the occurrence of any of the following events: (i) the scheduled principal or interest on the Bonds is not paid; or (ii) a draw on the Reserve Fund to pay to pay principal and interest on the Bonds which draw causes the Reserve Fund to be reduced to an amount less than the Reserve Requirement. (C) Amendment. The reporting requirements of this Section 5.14 shall be amended from time to time, without action by the City or the Fiscal Agent, to reflect any amendments to the applicable provisions of the Government Code, including the Act. 32 (D) Reports to Bondowners. The Chief Financial Officer shall provide copies of any reports required by this Section to any Bondowner upon the written request of a Bondowner and payment by the person requesting the information of the cost of the City to photocopy and pay any postage or other delivery cost to provide the same, as determined by the Chief Financial Officer. The term “Bondowner” for purposes of this Section shall include any beneficial owner of the Bonds as described in Section 2.12.
(E) No Liability. None of the City and its officers, agents and employees, or the Fiscal Agent shall be liable for any inadvertent error in reporting the information required by this Section.

Section 5.15. Covenant to Foreclose. The City hereby covenants with and 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 Placer 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 by more than 5% of the total amount of the Special Tax levied in such Fiscal Year, it will within 30 days thereafter institute foreclosure proceedings as authorized by the Act in order to enforce the lien of the delinquent installment of the Special Tax against each separate lot or parcel of land in Improvement Area No. 2 for which such installment of the Special Tax is delinquent, and will diligently prosecute and pursue such foreclosure proceedings to judgment and sale; provided, that if the City determines on the basis of such review that (a) the amount so collected is deficient by less than 5% of the total amount of the Special Tax levied in Improvement Area No. 2 in such Fiscal Year, but that property owned by any single property owner in Improvement Area No. 2 is delinquent by more than $5,000 with respect to the Special Tax due and payable by such property owner in such Fiscal Year, or (b) property owned by any single property owner in Improvement Area No. 2 is delinquent cumulatively by more than $3,250 with respect to the current and past Special Tax due (irrespective of the total delinquencies in Improvement Area No. 2), then the City will institute, prosecute and pursue such foreclosure proceedings in the time and manner provided herein against each such property owner. The Chief Financial Officer shall notify legal counsel of any such delinquency of which it is aware, and such legal counsel shall commence, or cause to be commenced, such actions to collect such delinquencies and subsequent foreclosure proceedings in such a manner as such counsel deems appropriate.

Section 5.16. Continuing Disclosure to Owners. The City hereby covenants and agrees that it will comply with and carry out all of the provisions of the Continuing Disclosure Certificate.

Notwithstanding any other provision of this Agreement, failure of the City to comply with the Continuing Disclosure Certificate shall not be considered a default hereunder; provided, any Participating Underwriter or any holder or beneficial owner of the Bonds may take such actions as may be necessary and appropriate to compel performance by the City of its obligations thereunder, including seeking mandate or specific performance by court order.

Section 5.17. Additional Bonds.
(A) Issuance of Additional Bonds. In addition to the 2023 Bonds, the City may, by a Supplemental Agreement, authorize the issuance of one or more additional series of special tax bonds (the “Additional Bonds”), payable from Special Taxes and secured by the Special Tax Revenues and other amounts pledged to the Bonds, as and to the extent set forth in Section

4.01, equally and ratably with 2023 Bonds, and the City may issue, and the Fiscal Agent may authenticate and deliver to the purchaser thereof, such Additional Bonds in the principal amount 33 as shall be determined by the City, subject to the following specific conditions, which are hereby made conditions precedent to the issuance of any such Additional Bonds:
(i) No default in the 2023 Bonds shall have occurred and then be continuing, (ii) The issuance of the Additional Bonds shall have been duly authorized by the City, and not exceed the maximum bonded indebtedness authorized under the Act. (iii) The Additional Bonds shall be payable as to principal on September 1 in each year in which principal becomes due, and shall be payable as to interest semiannually on March 1 and September 1.
(iv) There shall be deposited into a reserve account of the Reserve Fund, an amount at least equal to the Reserve Requirement with respect to such Additional Bonds.
(v) After giving effect to the issuance of the Additional Bonds:
(a) For each Bond Year the Additional Bonds are Outstanding, projected Special Taxes Revenues, if levied at the maximum annual Special Tax rates per the Special Tax Formula, in each Fiscal Year are at least equal to 110% of Debt Service due in the Bond Year that begins in the corresponding Fiscal Year, as calculated by the special tax consultant to the City; (b) The aggregate value of all parcels in Improvement Area No. 2 subject to the Special Tax, including then existing improvements and any facilities to be constructed or acquired with the proceeds of the Additional Bonds, as determined by an MAI appraisal, assessed valuations shown on the then current County tax roll, or by a combination of both methods, is at least 3 times the sum of (1) the aggregate principal amount of all Bonds then Outstanding, plus (2) the aggregate principal amount of the Additional Bonds proposed to be issued, plus (3) the proportionate principal amount of any bonds then outstanding and payable from assessments which are a lien against property in Improvement Area No. 2, plus (4) a portion of the aggregate principal amount of all bonds issued under the Act, other than 2023 Bonds then Outstanding and the Additional Bonds, payable at least partially from special taxes to be levied on parcels of land subject to the Special Tax within Improvement Area No. 2 (the “Other Mello-Roos Bonds”) equal to the aggregate principal amount of the Other Mello-Roos Bonds multiplied by a fraction, the numerator of which is the amount of special taxes levied for the Other Mello-Roos Bonds on parcels of land within Improvement Area No. 2 subject to the Special Tax, and the denominator of which is the total amount of special taxes levied for the Other Mello-Roos Bonds on all parcels of land subject to the Special Tax against which the special taxes are levied to pay the Other Mello-Roos Bonds (such fraction to be determined based upon the special taxes which could be levied the year in which the Additional Bonds are issued, as determined by the City), based upon information from the most recent available Fiscal Year.

Nothing in this Section or in this Agreement shall prevent or be construed to prevent the Supplemental Agreement providing for the issuance of Additional Bonds from pledging or 34 otherwise providing, in addition to the security given or intended to be given by this Agreement, additional security for the benefit of such Additional Bonds or any portion thereof.

Additional Bonds may be issued to finance the Project and/or to refund outstanding Bonds. Additional Bonds may be issued for the purpose of refunding any outstanding Bonds without meeting the foregoing conditions so long as debt service on the refunding Bonds in each Bond Year is less than debt service on the Bonds refunded.

Nothing in this Agreement shall be interpreted to prohibit issuance of bonds or Additional Bonds secured on a subordinate basis to the Bonds.
(B) Proceedings for Issuance of Additional Bonds. Whenever the City shall determine to issue Additional Bonds:
(i) The City shall authorize the execution of a Supplemental Agreement specifying the principal amount and prescribing the forms of the Additional Bonds and providing the terms, conditions, distinctive designation, denominations, methods of numbering, date, maturity date or dates, interest rate or rates (or the manner of determining same), interest payment dates, redemption provisions (including the amount and dates of mandatory sinking fund payments, if any), place or places of payment of principal or redemption price, if any, application of the proceeds thereof and any other provisions respecting the Additional Bonds not inconsistent with the terms of this Agreement, and
(ii) The Fiscal Agent shall receive an Officer’s Certificate stating that the requirements of Section 5.17(A) have been met.

Section 5.18. Yield of the Bonds. In determining the yield of the Bonds to comply with Section 5.12 and Section 6.02, the City will take into account redemption (including premium, if any) in advance of maturity based on the reasonable expectations of the City, as of the closing date of the Bonds, without regard to whether or not redemption moneys are received or Bonds are redeemed.
35 ARTICLE VI
INVESTMENTS; DISPOSITION OF INVESTMENT PROCEEDS;

LIABILITY OF THE CITY
Section 6.01. Deposit and Investment of Moneys in Funds. Subject in all respects to the provisions of Section 6.02, moneys in any fund or account created or established by this Agreement and held by the Fiscal Agent, shall be invested by the Fiscal Agent in Permitted Investments, as directed pursuant to an Officer’s Certificate filed (including by facsimile transmission) with the Fiscal Agent at least two (2) Business Days in advance of the making of such investments (such Officer’s Certificate to specify the particular Permitted Investment to be made). In the absence of any such Officer’s Certificate, the Fiscal Agent shall hold such moneys uninvested as cash and notify the Chief Financial Officer that it is doing so until further direction is received from the Chief Financial Officer. Subject in all respects to the provisions of Section 6.02, moneys in any fund or account created or established by this Agreement and held by the Chief Financial Officer shall be invested by the Chief Financial Officer in any lawful investments that the City may make, which by their terms mature prior to the date on which such moneys are required to be paid out hereunder. Obligations purchased as an investment of moneys in any fund shall be deemed to be part of such fund or account, subject, however, to the requirements of this Agreement for transfer of interest earnings and profits resulting from investment of amounts in funds and accounts.

The Fiscal Agent may act as principal or agent in the acquisition or disposition of any investment. The Fiscal Agent shall not incur any liability for losses, fees, taxes or other charges arising from or incurred in connection with any investments, reinvestments or liquidations of any investments made pursuant to this Section and hereunder. Any losses arising from any investments made pursuant to this Section shall be offset against interest earnings and profits retained in the same fund. In the event of a loss on the sale of such investments (after giving effect to any interest or other income thereon except to the extent theretofore paid to the City), the Fiscal Agent shall have no responsibility in respect of such loss except that the Fiscal Agent shall notify the City of the amount of such loss and the District shall promptly pay such amount to the Fiscal Agent to be credited as part of the moneys originally invested.

Except as otherwise provided in the next sentence, all investments of amounts deposited in any fund or account created by or pursuant to this Agreement, or otherwise containing gross proceeds of the Bonds (within the meaning of Section 148 of the Code), shall be acquired, disposed of, and valued (as of the date that valuation is required by this Agreement or the Code) at Fair Market Value. Investments in funds or accounts (or portions thereof) that are subject to a yield restriction under applicable provisions of the Code and (unless valuation is undertaken at least annually) investments in the Reserve Fund shall be valued by the City at their present value (within the meaning of Section 148 of the Code). The Fiscal Agent shall not be liable for verification of the application of such sections of the Internal Revenue Code of 1986, as amended (the “Tax Code”), or for any determination of Fair Market Value or present value and may conclusively rely upon an Officer’s Certificate as to such valuations.

Investments in any and all funds and accounts may be commingled in a separate fund or funds for purposes of making, holding and disposing of investments, notwithstanding provisions herein for transfer to or holding in or to the credit of particular funds or accounts of amounts received or held by the Fiscal Agent or the Chief Financial Officer hereunder, provided that the Fiscal Agent or the Chief Financial Officer, as applicable, shall at all times account for such 36 investments strictly in accordance with the funds and accounts to which they are credited and otherwise as provided in this Agreement.

The Fiscal Agent or the Chief Financial Officer, as applicable, shall sell or present for redemption, any investment security whenever it shall be necessary to provide moneys to meet any required payment, transfer, withdrawal or disbursement from the fund or account to which such investment security is credited and, subject to the second paragraph of this Section, neither the Fiscal Agent nor the Chief Financial Officer shall be liable or responsible for any loss resulting from the acquisition or disposition of such investment security in accordance herewith.

The City acknowledges that to the extent regulations of the Comptroller of the Currency or other applicable regulatory entity grant the City the right to receive brokerage confirmations of security transactions as they occur, the City specifically waives receipt of such confirmations to the extent permitted by law. The Fiscal Agent will furnish the City periodic cash transaction statements which include detail for all investment transactions made by the Fiscal Agent hereunder.

Section 6.02. Rebate of Excess Investment Earnings to the United States. The City covenants to calculate and rebate to the federal government, in accordance with the Regulations, excess investment earnings to the extent required by Section 148(f) of the Code.

The City shall notify the Fiscal Agent of any amounts determined to be due to the federal government, and the Fiscal Agent shall, upon receipt of an Officer’s Certificate of the City, withdraw such amounts from the Reserve Fund pursuant to Section 4.03(D), and pay such amounts to the federal government as directed by the Officer’s Certificate which shall comply with the requirements of the Code and the Regulations. In the event of any shortfall in amounts available to make such payments under Section 4.03(D), the Fiscal Agent shall notify the Chief Financial Officer in writing of the amount of the shortfall and the Chief Financial Officer shall make such payment from any amounts available in the Special Tax Fund. Any fees or expenses incurred by the Fiscal Agent or the City under or pursuant to this Section 6.02 shall be Administrative Expenses. The Fiscal Agent may rely conclusively and shall be fully protected from liability in conclusively relying upon the City’s determinations, calculations, opinions, directions and certifications required by this Section. The Fiscal Agent shall have no responsibility to independently make any calculation or determination or to review the City’s calculations hereunder or to confirm the adequacy or correctness of any rebate report. The Fiscal Agent shall be deemed conclusively to have complied with the provisions of this Agreement and any other agreement relating to the Bonds regarding calculation and payment of rebate if it follows the directions of the City or the District, and it shall have no independent duty to review or enforce the City’s or District’s compliance with such rebate requirements. Except to the extent expressly herein provided, the Fiscal Agent shall in no instance be responsible or liable for the tax treatment of the Bonds, the City’s or District’s compliance with the Code, or any other tax consequences in connection with the Bonds.

In order to provide for the administration of this Section 6.02, the City may provide for the employment of independent attorneys, accountants and consultants compensated on such reasonable basis as the City may deem appropriate.

Section 6.03. Limited Obligation. The City’s obligations hereunder are limited obligations of the City on behalf of the District and are payable solely from and secured solely 37 by the Special Tax Revenues and the amounts in the Special Tax Fund, the Bond Fund and the Reserve Fund created hereunder.
38 ARTICLE VII

THE FISCAL AGENT
Section 7.01. Appointment of Fiscal Agent. U.S. Bank Trust Company, National Association, at its Principal Office, is hereby appointed Fiscal Agent for the Bonds. The Fiscal Agent undertakes to perform such duties, and only such duties, as are specifically set forth in this Agreement, and no implied covenants or obligations shall be read into this Agreement against the Fiscal Agent.

Any a bank, national banking association or trust company into which the Fiscal Agent may be merged or converted or with which it may be consolidated or any a bank, national banking association or trust company resulting from any merger, conversion or consolidation to which it shall be a party or any a bank, national banking association or trust company to which the Fiscal Agent may sell or transfer all or substantially all of its corporate trust business and assets as a whole or substantially as a whole, provided such company shall be eligible under the following paragraph of this Section, shall be and shall become the successor to such Fiscal Agent without the execution or filing of any paper or any further act, anything herein to the contrary notwithstanding.

The City may remove the Fiscal Agent initially appointed, and any successor thereto, with 30 days’ prior notice, and may appoint a successor or successors thereto, but any such successor shall be a bank, national banking association or trust company having a combined capital (exclusive of borrowed capital) and surplus of at least Fifty Million Dollars ($50,000,000) including, for such purpose, the combined capital and surplus of any parent holding company, and subject to supervision or examination by federal or state authority. If such bank, national banking association or trust company publishes a report of condition at least annually, pursuant to law or to the requirements of any supervising or examining authority above referred to, then for the purposes of this Section 7.01, combined capital and surplus of such bank, national banking association or trust company shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published.

The Fiscal Agent may at any time resign by giving written notice to the City and by giving to the Owners notice by mail of such resignation. Upon receiving notice of such resignation, the City shall promptly appoint a successor Fiscal Agent by an instrument in writing. Any resignation or removal of the Fiscal Agent shall become effective upon acceptance of appointment by the successor Fiscal Agent.

If no appointment of a successor Fiscal Agent shall be made pursuant to the foregoing provisions of this Section within thirty (30) days after the Fiscal Agent shall have given to the City written notice or after a vacancy in the office of the Fiscal Agent shall have occurred by reason of its inability to act or removal by the City, the Fiscal Agent (at the expense of the City) or any Bondowner may apply to any court of competent jurisdiction to appoint a successor Fiscal Agent. Said court may thereupon, after such notice, if any, as such court may deem proper, appoint a successor Fiscal Agent.

Section 7.02. Liability of Fiscal Agent. The recitals of facts, covenants and agreements herein and in the Bonds contained shall be taken as statements, covenants and agreements of the City, and the Fiscal Agent assumes no responsibility for the correctness of the same, or makes any representations as to the validity or sufficiency of this Agreement or of the Bonds, or shall incur any responsibility in respect thereof, other than in connection with the duties or 39 obligations herein or in the Bonds assigned to or imposed upon it. The Fiscal Agent shall not be liable in connection with the performance of its duties hereunder, except for its own gross negligence or willful misconduct. The Fiscal Agent assumes no responsibility or liability for any information, statement or recital in any offering memorandum or other disclosure material prepared or distributed with respect to the issuance of the Bonds. All indemnifications, rights, privileges, protections, immunities, benefits and releases from liability granted to the Fiscal Agent hereunder shall extend to the directors, officers and employees of the Fiscal Agent. The Fiscal Agent has no liability regarding the use or applications of the Bonds or the proceeds from the purchase of the Bonds deposited in funds held by the City.

In the absence of bad faith, the Fiscal Agent may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Fiscal Agent and conforming to the requirements of this Agreement, including all Officer’s Certificates of the City meeting such requirements; but in the case of any such certificates or opinions by which any provision hereof are specifically required to be furnished to the Fiscal Agent, the Fiscal Agent shall be under a duty to examine the same to determine whether or not they conform, on their face, to the requirements of this Agreement (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein).

Except as provided above in this paragraph, the Fiscal Agent shall conclusively rely and be protected and shall incur no liability in acting or proceeding, or in not acting or not proceeding, , reasonably and in accordance with the terms of this Agreement, upon any resolution, order, notice, request, consent or waiver, certificate, statement, affidavit, opinion, report, direction, bond, other evidence of indebtedness or other paper or document which it shall believe to be genuine and to have been adopted or signed by the proper person or to have been prepared and furnished pursuant to any provision of this Agreement, and the Fiscal Agent shall not be under any duty to make any investigation or inquiry as to any statements contained or matters referred to in any such instrument.

The Fiscal Agent shall not be liable for any error of judgment made in good faith by a responsible officer unless it shall be proved that the Fiscal Agent was grossly negligent in ascertaining the pertinent facts.

No provision of this Agreement shall require the Fiscal Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity satisfactory to the Fiscal Agent against such risk or liability is not reasonably assured to it.

The Fiscal Agent shall be under no obligation to exercise any of the rights or powers vested in it by this Agreement at the request or direction of any of the Owners pursuant to this Agreement unless such Owners shall have offered to the Fiscal Agent reasonable security or indemnity against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction.

The Fiscal Agent shall in no event be responsible or liable for any failure or delay in the performance of its obligations hereunder or progress in respect thereto in the event of failure or unavoidable delay in the performance of such obligations arising out of or caused by, directly or indirectly, causes beyond its control, including, but not limited to, Acts of God or of the public enemy or terrorists, acts of a government, civil or military disturbance, accidents, acts of the other party, fires, floods, epidemics, pandemics, recognize public emergencies, quarantine restrictions, nuclear or natural catastrophes, strikes, work stoppages, freight embargoes, 40 earthquakes, explosion, mob violence, riot, inability to procure or general sabotage or rationing of labor, equipment, facilities, sources of energy, material or supplies in the open market, litigation or arbitration involving a party or others relating to zoning or other governmental action or inaction pertaining to the project, malicious mischief, condemnation, unusually severe weather or delays of suppliers or subcontractors due to such causes, interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services, hacking, cyber-attacks, or other use or infiltration of the Fiscal Agent’s technological infrastructure exceeding authorized access or any similar event and/or occurrences beyond the control of the Fiscal Agent.

The Fiscal Agent, in its individual or other capacity, may become the owner of the Bonds with the same rights it would have if it were not the Fiscal Agent.

The Fiscal Agent shall not be concerned with or accountable to anyone for the subsequent use or application of any moneys which shall be released or withdrawn in accordance with the provisions hereof.

In no event shall the Fiscal Agent be responsible or liable for special, indirect, punitive or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Fiscal Agent has been advised of the likelihood of such loss or damage and regardless of the form of action.

The Fiscal Agent shall not be deemed to have notice of any default unless an officer of the Fiscal Agent has actual knowledge thereof or unless written notice of any event which is in fact such a default is received by the Fiscal Agent at the Principal Office of the Fiscal Agent, and such notice references the Bonds and this Agreement.

Before taking any action hereunder at the request or direction of the Beneficial Owners or Owners, the Fiscal Agent may require that security or indemnity satisfactory to it be furnished to it for the reimbursement of its fees, costs, liabilities and all expenses (including attorneys’ fees and expenses) which it may incur and to protect it against all liability.

The Fiscal Agent shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Fiscal Agent, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Fiscal Agent shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the District, personally or by agent or attorney at the sole cost of the District and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation.

Delivery of any reports, information and documents to the Fiscal Agent is for informational purposes only and the Fiscal Agent's receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the City’s or District’s compliance with any of its covenants hereunder. The Fiscal Agent shall have no duty to review or make independent investigation with respect to any of the foregoing received by the Fiscal Agent, and shall hold the same solely as repository.
41 Money held by the Fiscal Agent in trust hereunder need not be segregated from other funds except to the extent required by law. The Fiscal Agent shall be under no liability for interest on any money received by it hereunder except as otherwise agreed in writing with the City.

The permissive right of the Fiscal Agent to do things enumerated in this Agreement shall not be construed as a duty and it shall not be answerable for other than its gross negligence or willful misconduct.

The Fiscal Agent may execute any of the trusts or powers hereof and perform the duties required of it hereunder either directly or by or through attorneys or agents, and shall be entitled to rely on advice of counsel concerning all matters of trust and its duty hereunder.

Section 7.03. Information. The Fiscal Agent shall provide to the City such information relating to the Bonds and the funds and accounts maintained by the Fiscal Agent hereunder as the City shall reasonably request, including but not limited to quarterly statements reporting funds held and transactions by the Fiscal Agent.

Section 7.04. Notice to Fiscal Agent. The Fiscal Agent may conclusively rely and shall be protected in acting or refraining from acting upon any Officer’s Certificate, notice, resolution, request, consent, order, certificate, report, facsimile transmission, electronic mail, warrant, statement, opinion, instrument, direction, note, Bond or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or proper parties and given in accordance with the requirements hereof. The Fiscal Agent may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and the Fiscal Agent shall not be responsible for any acts, omissions, misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder. The Fiscal Agent may consult with counsel of its selection, who may be counsel to the City, with regard to legal questions, and the opinion of such counsel shall be full and complete authorization and protection in respect of any action taken, omitted or suffered by it hereunder in good faith and in accordance therewith.

The Fiscal Agent shall have the right to accept and act upon instructions, including funds transfer instructions (“Instructions”) given pursuant to this Agreement and delivered using Electronic Means by an Authorized Officer (or his or her designee) (“Electronic Means” shall mean the following communications methods: e-mail, facsimile transmission, other similar unsecure electronic methods, secure electronic transmission containing applicable authorization codes, passwords and/or authentication keys issued by the Fiscal Agent, or another method or system specified by the Fiscal Agent as available for use in connection with its services hereunder); provided, however, that the City shall provide to the Fiscal Agent an incumbency certificate for each person with the authority to provide such Instructions and containing specimen signatures of such persons, which incumbency certificate shall be amended by the City whenever a person is to be added or deleted from the listing. If the City elects to give the Fiscal Agent Instructions using Electronic Means and the Fiscal Agent in its discretion elects to act upon such Instructions, the Fiscal Agent’s understanding of such Instructions shall be deemed controlling. The City understands and agrees that the Fiscal Agent cannot determine the identity of the actual sender of such Instructions and that the Fiscal Agent shall conclusively presume that directions that purport to have been sent by an Authorized Officer (or designee) listed on the incumbency certificate provided to the Fiscal Agent have been sent by such Authorized Officer (or designee). The City shall be responsible for ensuring that only Authorized Officers (or their designees) transmit such Instructions to the Fiscal Agent and that the City is 42 solely responsible to safeguard the use and confidentiality of applicable user and authorization codes, passwords and/or authentication keys upon receipt by the City. The Fiscal Agent shall not be liable for any losses, costs or expenses arising directly or indirectly from the Fiscal Agent’s reliance upon and compliance with such Instructions notwithstanding such directions conflict or are inconsistent with a subsequent written instruction. The City agrees: (i) to assume all risks arising out of the use of Electronic Means to submit Instructions to the Fiscal Agent, including without limitation the risk of the Fiscal Agent acting on unauthorized Instructions, and the risk of interception and misuse by third parties; (ii) that it is fully informed of the protections and risks associated with the various methods of transmitting Instructions to the Fiscal Agent and that there may be more secure methods of transmitting Instructions than the method(s) selected by the City; (iii) that the security procedures (if any) to be followed in connection with its transmission of Instructions provide to it a commercially reasonable degree of protection in light of its particular needs and circumstances; and (iv) to notify the Fiscal Agent immediately upon learning of any compromise or unauthorized use of the security procedures.

The Fiscal Agent shall not be bound to recognize any person as the Owner of a Bond unless and until such Bond is submitted for inspection, if required, and his title thereto satisfactorily established, if disputed.

Whenever in the administration of its duties under this Agreement the Fiscal Agent shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may, in the absence of willful misconduct on the part of the Fiscal Agent, be deemed to be conclusively proved and established by a certificate of the City, and such certificate shall be full warrant to the Fiscal Agent for any action taken or suffered under the provisions of this Agreement or any Supplemental Agreement upon the faith thereof, but in its discretion the Fiscal Agent may, in lieu thereof, accept other evidence of such matter or may require such additional evidence as to it may seem reasonable.

Section 7.05. Compensation, Indemnification. The City shall pay to the Fiscal Agent from time to time such compensation agreed to in writing from time to time for all services rendered as Fiscal Agent under this Agreement, and also all fees, expenses, charges, counsel fees, advances and other disbursements, including those of their attorneys, agents and employees, incurred in and about the performance of their powers and duties under this Agreement, but the Fiscal Agent shall not have a lien therefor on any funds at any time held by it under this Agreement. The City further agrees, to the extent permitted by applicable law, to indemnify and save the Fiscal Agent, its officers, employees, directors and agents harmless against any costs, claims, expenses, losses, taxes, damages or liabilities, including, without limitation, fees and expenses of its attorneys which it may incur in connection with and arising out of the exercise and performance of its powers and duties hereunder, including the costs and expenses of enforcing the provisions of this Agreement (including this Section) against the District or the City and defending itself against any claim (whether asserted by the District, the City or any Owner or any other person), or liability in connection with the exercise or performance of any of its powers or duties hereunder which are not due to its gross negligence or willful misconduct. The obligation of the City under this Section shall survive resignation or removal of the Fiscal Agent under this Agreement and payment of the Bonds and discharge of this Agreement.
43 ARTICLE VIII

MODIFICATION OR AMENDMENT OF THIS AGREEMENT
Section 8.01. Amendments Permitted. This Agreement and the rights and obligations of the City and of the Owners of the Bonds may be modified or amended at any time by a Supplemental Agreement pursuant to the affirmative vote at a meeting of Owners, or with the written consent without a meeting, of the Owners of at least 60% in aggregate principal amount of the Bonds then Outstanding, exclusive of Bonds disqualified as provided in Section 8.04. No such modification or amendment shall, with respect to Bonds then Outstanding, (i) extend the maturity of any Bond or reduce the interest rate thereon, or otherwise alter or impair the obligation of the City to pay the principal of, and the interest and any premium on, any Bond, without the express consent of the Owner of such Bond, or (ii) permit the creation by the City of any pledge or lien upon the Special Taxes superior to or on a parity with the pledge and lien created for the benefit of the Bonds (except as otherwise permitted by the Act, the laws of the State of California or this Agreement), or reduce the percentage of Bonds required for the amendment hereof. No such amendment may modify any of the rights or obligations of the Fiscal Agent without its written consent.

This Agreement and the rights and obligations of the City and of the Owners may also be modified or amended at any time by a Supplemental Agreement, without the consent of any Owners, only to the extent permitted by law and only for any one or more of the following purposes:
(A) to add to the covenants and agreements of the City in this Agreement contained, other covenants and agreements thereafter to be observed, or to limit or surrender any right or power herein reserved to or conferred upon the City; (B) to make modifications not adversely affecting any outstanding series of Bonds in any material respect, including to effectuate the issuance of Additional Bonds in accordance with Section 5.17;
(C) to make such provisions for the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective provision contained in this Agreement, or in regard to questions arising under this Agreement, as the City and the Fiscal Agent may deem necessary or desirable, and which shall not adversely affect the rights of the Owners of the Bonds; or
(D) to make such additions, deletions or modifications as may be necessary or desirable to assure compliance with Section 148 of the Code relating to required rebate of excess investment earnings to the United States or otherwise as may be necessary to assure exclusion from gross income for federal income tax purposes of interest on the Bonds or to conform with the Regulations.

No such amendment may modify any of the rights or obligations of the Fiscal Agent without its written consent.

Section 8.02. Owners’ Meetings. The City may at any time call a meeting of the Owners. In such event the City is authorized to fix the time and place of said meeting and to provide for the giving of notice thereof and to fix and adopt rules and regulations for the conduct of said meeting.
44 Section 8.03. Procedure for Amendment with Written Consent of Owners. The City and the Fiscal Agent may at any time enter into a Supplemental Agreement amending the provisions of the Bonds or of this Agreement or any Supplemental Agreement, to the extent that such amendment is permitted by Section 8.01, to take effect when and as provided in this Section. A copy of such Supplemental Agreement, together with a request to Owners for their consent thereto, if such consent is required under Section 8.01, shall be mailed by first class mail, at the expense of the City, by the Fiscal Agent to each Owner of Bonds Outstanding, but failure to mail copies of such Supplemental Agreement and request shall not affect the validity of the Supplemental Agreement when assented to as in this Section provided.

If consent of the Owners is required under Section 8.01, such Supplemental Agreement shall not become effective unless there shall be filed with the Fiscal Agent the written consents of the Owners of at least 60% in aggregate principal amount of the Bonds then Outstanding (exclusive of Bonds disqualified as provided in Section 8.04) and a notice shall have been mailed as hereinafter in this Section provided. Each such consent shall be effective only if accompanied by proof of ownership of the Bonds for which such consent is given, which proof shall be such as is permitted by Section 9.04. Any such consent shall be binding upon the Owner of the Bonds giving such consent and on any subsequent Owner (whether or not such subsequent Owner has notice thereof) unless such consent is revoked in writing by the Owner giving such consent or a subsequent Owner by filing such revocation with the Fiscal Agent prior to the date when the notice hereinafter in this Section provided for has been mailed.

After the Owners of the required percentage of Bonds shall have filed their consents to the Supplemental Agreement, the City shall mail a notice to the Owners in the manner hereinbefore provided in this Section for the mailing of the Supplemental Agreement, stating in substance that the Supplemental Agreement has been consented to by the Owners of the required percentage of Bonds and will be effective as provided in this Section (but failure to mail copies of said notice shall not affect the validity of the Supplemental Agreement or consents thereto). Proof of the mailing of such notice shall be filed with the Fiscal Agent. A record, consisting of the papers required by this Section 8.03 to be filed with the Fiscal Agent, shall be proof of the matters therein stated until the contrary is proved. The Supplemental Agreement shall become effective upon the filing with the Fiscal Agent of the proof of mailing of such notice, and the Supplemental Agreement shall be deemed conclusively binding (except as otherwise herein above specifically provided in this Article) upon the City and the Owners of all Bonds at the expiration of 60 days after such filing, except in the event of a final decree of a court of competent jurisdiction setting aside such consent in a legal action or equitable proceeding for such purpose commenced within such sixty-day period.

Section 8.04. Disqualified Bonds. Bonds actually known by the Fiscal Agent to be owned or held for the account of the City, excepting any pension or retirement fund, shall not be deemed Outstanding for the purpose of any vote, consent or other action or any calculation of Outstanding Bonds provided for in this Article VIII, and shall not be entitled to vote upon, consent to, or take any other action provided for in this Article VIII. The City shall provide an Officer’s Certificate to the Fiscal Agent listing those Bonds which are disqualified pursuant to this Section 8.04.

Section 8.05. Effect of Supplemental Agreement. From and after the time any Supplemental Agreement becomes effective pursuant to this Article VIII, this Agreement shall be deemed to be modified and amended in accordance therewith, the respective rights, duties and obligations under this Agreement of the City and all Owners of Bonds Outstanding shall 45 thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments, and all the terms and conditions of any such Supplemental Agreement shall be deemed to be part of the terms and conditions of this Agreement for any and all purposes. The Fiscal Agent may, but shall not be obligated to, enter into any such Supplemental Agreement which affects the Fiscal Agent's own rights, duties or immunities under this Agreement or otherwise.

Section 8.06. Endorsement or Replacement of Bonds Issued After Amendments. The City may determine that Bonds issued and delivered after the effective date of any action taken as provided in this Article VIII shall bear a notation, by endorsement or otherwise, in form approved by the City, as to such action. In that case, upon demand of the Owner of any Bond Outstanding at such effective date and presentation of his Bond for that purpose at the Principal Office of the Fiscal Agent or at such other office as the City may select and designate for that purpose, a suitable notation shall be made on such Bond at the expense of the City.

The City may determine that new Bonds, so modified as in the opinion of the City is necessary to conform to such Owners’ action, shall be prepared, executed and delivered. In that case, upon demand of the Owner of any Bonds then Outstanding, such new Bonds shall be exchanged at the Principal Office of the Fiscal Agent without cost to any Owner and at the expense of the City, for Bonds then Outstanding, upon surrender of such Bonds.

Section 8.07. Amendatory Endorsement of Bonds. The provisions of this Article VIII shall not prevent any Owner from accepting any amendment as to the particular Bonds held by him, provided that due notation thereof is made on such Bonds.

Section 8.08. Opinion of Counsel Regarding Supplemental Agreement. The Fiscal Agent shall be furnished, upon request, an opinion of counsel that any Supplemental Agreement entered into by the City and the Fiscal Agent complies with the provisions of this Article VIII, and the Fiscal Agent may conclusively rely upon such opinion. 46 ARTICLE IX

MISCELLANEOUS
Section 9.01. Benefits of Agreement Limited to Parties. Nothing in this Agreement expressed or implied, is intended to give to any person other than the City, the Fiscal Agent and the Owners, any right, remedy, claim under or by reason of this Agreement. Any covenants, stipulations, promises or agreements in this Agreement contained by and on behalf of the City shall be for the sole and exclusive benefit of the Owners and the Fiscal Agent.

Section 9.02. Successor is Deemed Included in All References to Predecessor.

Whenever in this Agreement or any Supplemental Agreement either the City or the Fiscal Agent is named or referred to, such reference shall be deemed to include the successors or assigns thereof, and all the covenants and agreements in this Agreement contained by or on behalf of the City or the Fiscal Agent shall bind and inure to the benefit of the respective successors and assigns thereof whether so expressed or not.

Section 9.03. Discharge of Agreement. If the City shall pay and discharge the entire indebtedness on all or any portion of the Bonds Outstanding in any one or more of the following ways:
(A) by well and truly paying or causing to be paid the principal of, and interest and any premium on, such Bonds Outstanding, as and when the same become due and payable;
(B) by depositing with the Fiscal Agent or other fiduciary, at or before maturity, money which, together with (in the event that all of the Bonds are to be defeased) the amounts then on deposit in the funds and accounts provided for in Sections 4.02 and 4.03, is fully sufficient to pay such Bonds Outstanding, including all principal, interest and redemption premiums, or;
(C) by irrevocably depositing with the Fiscal Agent or other fiduciary, cash and Federal Securities in such amount as the City shall determine as confirmed by an independent certified public accountant will, together with the interest to accrue thereon and (in the event that all of the Bonds are to be defeased) moneys then on deposit in the fund and accounts provided for in Sections 4.02 and 4.03, be fully sufficient to pay and discharge the indebtedness on such Bonds (including all principal, interest and redemption premiums) at or before their respective maturity dates; and if such Bonds are to be redeemed prior to the maturity thereof notice of such redemption shall have been given as in this Agreement provided or provision satisfactory to the Fiscal Agent shall have been made for the giving of such notice, then, at the election of the City, and notwithstanding that any Bonds shall not have been surrendered for payment, the pledge of the Special Taxes and other funds provided for in this Agreement and all other obligations of the City under this Agreement with respect to such Bonds Outstanding shall cease and terminate, except only the obligations of the City (i) under Section 5.13 (Maintenance of Tax-Exemption) and (ii) to pay or cause to be paid to the Owners of the Bonds not so surrendered and paid all sums due thereon and all amounts owing to the Fiscal Agent pursuant to Section 7.05; and thereafter Special Taxes shall not be payable to the Fiscal Agent. Notice of such election shall be filed with the Fiscal Agent.
47 Any funds thereafter held by the Fiscal Agent upon payments of all fees and expenses of the Fiscal Agent, which are not required for said purpose, shall be paid over to the City. The City shall pay and indemnify the Fiscal Agent against any tax, fee or other charge imposed on or assessed against the Federal Securities deposited pursuant to this Section or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Owners of Outstanding Bonds.

Section 9.04. Execution of Documents and Proof of Ownership by Owners. Any request, declaration or other instrument which this Agreement may require or permit to be executed by Owners may be in one or more instruments of similar tenor, and shall be executed by Owners in person or by their attorneys appointed in writing.

Except as otherwise herein expressly provided, the fact and date of the execution by any Owner or his attorney of such request, consent, declaration or other instrument, or of such writing appointing such attorney, may be proved by the certificate of any notary public or other officer authorized to take acknowledgments of deeds to be recorded in the state in which he purports to act, that the person signing such request, declaration or other instrument or writing acknowledged to him the execution thereof, or by an affidavit of a witness of such execution, duly sworn to before such notary public or other officer.

Except as otherwise herein expressly provided, the ownership of registered Bonds and the amount, maturity, number and date of holding the same shall be proved by the registry books.

Any request, consent, declaration or other instrument or writing of the Owner of any Bond shall bind all future Owners of such Bond in respect of anything done or suffered to be done by the City or the Fiscal Agent in good faith and in accordance therewith.

Section 9.05. Waiver of Personal Liability. No member, officer, agent or employee of the City shall be individually or personally liable for the payment of the principal of, or interest or any premium on, the Bonds; but nothing herein contained shall relieve any such member, officer, agent or employee from the performance of any official duty provided by law.

Section 9.06. Notices to and Demands on City and Fiscal Agent. Any notice or demand which by any provision of this Agreement is required or permitted to be given or served by the Fiscal Agent to or on the City may be given or served by being deposited postage prepaid in a post office letter box, by overnight courier or by electronic means (with receipt confirmed by telephone) addressed (until another address is filed by the City with the Fiscal Agent) as follows:

City of Roseville
311 Vernon Street
Roseville, California 95678
Attention: Chief Financial Officer
Fax: (916) 746-1220
Any notice or demand which by any provision of this Agreement is required or permitted to be given or served by the City to or on the Fiscal Agent may be given or served by being deposited postage prepaid in a post office letter box, by overnight courier or by electronic means (with receipt confirmed by telephone) addressed (until another address is filed by the Fiscal Agent with the City) as follows:
48 U.S. Bank Trust Company, National Association
One California Street, Suite 1000
San Francisco, CA 94111
Attention: Global Corporate Trust
Fax: (415) 677-3768
Section 9.07. Partial Invalidity. If any Section, paragraph, sentence, clause or phrase of this Agreement shall for any reason be held illegal or unenforceable, such holding shall not affect the validity of the remaining portions of this Agreement. The City hereby declares that it would have adopted this Agreement and each and every other Section, paragraph, sentence, clause or phrase hereof and authorized the issue of the Bonds pursuant thereto irrespective of the fact that any one or more Sections, paragraphs, sentences, clauses, or phrases of this Agreement may be held illegal, invalid or unenforceable.

Section 9.08. Unclaimed Moneys. Anything contained herein to the contrary notwithstanding, any moneys held by the Fiscal Agent in trust for the payment and discharge of the principal of, and the interest and any premium on, the Bonds which remain unclaimed for two years after the date when the payments of such principal, interest and premium have become payable, if such moneys were held by the Fiscal Agent at such date, shall be repaid by the Fiscal Agent to the City as its absolute property free from any trust, and the Fiscal Agent shall thereupon be released and discharged with respect thereto and the Bond Owners shall look only to the City for the payment of the principal of, and interest and any premium on, such Bonds.

Section 9.09. Applicable Law. This Agreement shall be governed by and enforced in accordance with the laws of the State of California applicable to contracts made and performed in the State of California.

Section 9.10. Conflict with Act. In the event of a conflict between any provision of this Agreement with any provision of the Act as in effect on the Closing Date, the provision of the Act shall prevail over the conflicting provision of this Agreement.

Section 9.11. Conclusive Evidence of Regularity. Bonds issued pursuant to this Agreement shall constitute conclusive evidence of the regularity of all proceedings under the Act relative to their issuance and the levy of the Special Taxes.

Section 9.12. Payment on Business Day. In any case where the date of the maturity of interest or of principal (and premium, if any) of the Bonds or the date fixed for redemption of any Bonds or the date any action is to be taken pursuant to this Agreement is other than a Business Day, the payment of interest or principal (and premium, if any) or the action need not be made on such date but may be made on the next succeeding day which is a Business Day with the same force and effect as if made on the date required and no interest shall accrue for the period from and after such date.

Section 9.13. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original. The exchange of copies of this Agreement and of signature pages by facsimile or PDF transmission shall constitute effective execution and delivery of this Agreement as to the parties hereto and may be used in lieu of the original Agreement and signature pages for all purposes.
49 Section 9.14. Waiver of Jury Trial. EACH OF THE DISTRICT, THE CITY, THE

OWNERS AND THE FISCAL AGENT HEREBY IRREVOCABLY WAIVES, TO THE FULLEST

EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN

ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE NOTES OR THE TRANSACTIONS CONTEMPLATED HEREBY.

Section 9.15. U.S.A. Patriot Act. The City and the District acknowledge that in accordance with Section 326 of the U.S.A. Patriot Act, the Fiscal Agent, like all financial institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account with the Fiscal Agent. The City and the District agree that they will provide the Fiscal Agent with such information as it may request in order for the Fiscal Agent to satisfy the requirements of the U.S.A. Patriot Act. [Signature Page to Fiscal Agent Agreement dated as of July 1, 2023] IN WITNESS WHEREOF, the City of Roseville has authorized the execution of this Agreement by its City Manager and attested to by its City Clerk under the authority of Resolution No. ______, adopted by the Council of the City of Roseville on ________, 2023, and the Fiscal Agent has caused this Agreement to be executed.

CITY OF ROSEVILLE, a municipal corporation,
for and on behalf of the City of Roseville
Creekview Community Facilities District No. 1
(Public Facilities)
By:

DOMINICK CASEY
City Manager
U.S. BANK TRUST COMPANY, NATIONAL
ASSOCIATION, as Fiscal Agent
By:

Vice President
ATTEST:

By:

CARMEN AVALOS
City Clerk
APPROVED AS TO FORM:

By:

MICHELLE SHEIDENBERGER
City Attorney
APPROVED AS TO SUBSTANCE:

By:

DENNIS KAUFFMAN
Chief Financial Officer
A-1

EXHIBIT A

FORM OF BOND

UNITED STATES OF AMERICA

STATE OF CALIFORNIA
No. __________ $____________

CITY OF ROSEVILLE
CREEKVIEW COMMUNITY FACILITIES DISTRICT NO. 1 (PUBLIC FACILITIES) IMPROVEMENT AREA NO. 2

SPECIAL TAX BONDS
SERIES 2023
INTEREST RATE: MATURITY DATE: BOND DATE: CUSIP:
% September 1, 20__ ___________, 2023
REGISTERED OWNER: CEDE & CO.

PRINCIPAL AMOUNT: DOLLARS
The City of Roseville (the “City”) for and on behalf of the City of Roseville Creekview Community Facilities District No. 1 (Public Facilities) (the “District”), for value received, hereby promises to pay solely from the Special Tax Revenues (as hereinafter defined) or amounts in certain funds and accounts held under the Agreement (as hereinafter defined), to the Registered Owner named above, or registered assigns (the “Owner”), on the Maturity Date set forth above, unless redeemed prior thereto as hereinafter provided, the Principal Amount set forth above, and to pay interest on such principal amount from the Bond Date shown above, or from the most recent Interest Payment Date (as hereinafter defined) to which interest has been paid or duly provided for, semiannually on March 1 and September 1, commencing March 1, 2023 (the “Interest Payment Dates”), at the Interest Rate set forth above, until the principal amount hereof is paid or made available for payment. The principal of this Bond is payable to the Owner hereof in lawful money of the United States of America upon presentation and surrender of this Bond at the principal corporate trust office of U.S. Bank Trust Company, National Association in San Francisco, California (the “Fiscal Agent”). Interest on this Bond shall be paid by check of the Fiscal Agent mailed by first class mail on each Interest Payment Date to the Owner hereof as of the close of business on the 15th day of the month preceding the month in which the Interest Payment Date occurs whether or not such day is a Business Day (the “Record Date”) at such Owner’s address as it appears on the registration books maintained by the Fiscal Agent, or by wire transfer made on such Interest Payment Date upon written instructions delivered to the Fiscal Agent by the applicable Record Date of any Owner of $1,000,000 or more in aggregate principal amount of Bonds.

A-2
This Bond is one of a duly authorized issue of bonds approved by resolution of the City Council of the City adopted on __________, 2023 (the “Resolution”), pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, Sections 53311, et seq., of the California Government Code (the “Mello-Roos Act”) for the purpose of providing moneys for the construction and acquisition of authorized improvements for the District, and is one of the bonds designated “City of Roseville Creekview Community Facilities District No. 1 (Public Facilities) Improvement Area No. 2 Special Tax Bonds Series 2023” (the “Bonds”). The issuance of the Bonds and the terms and conditions thereof are provided for by a Fiscal Agent Agreement, dated as of July 1, 2023, by and between the City and the Fiscal Agent (the “Agreement”) and this reference incorporates the Agreement herein, and by acceptance hereof the Owner of this Bond assents to said terms and conditions. The Agreement is authorized under, this Bond is issued under and both are to be construed in accordance with, the laws of the State of California.

Pursuant to the Mello-Roos Act, the Agreement and the Resolution, the principal of and interest on this Bond are payable solely from Special Tax Revenues and the amounts in certain funds held under the Agreement. “Special Tax Revenues” means the proceeds of the facilities special tax (“Special Taxes”) levied under the Mello-Roos Act in Improvement Area No. 2 of the District that are received by the City, including all scheduled payments and delinquent payments thereof, interest thereon and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the special taxes, net of a 1% administration charge of the County (as such charge may be changed in the future), but not including interest in excess of the interest due on the Bonds or any penalties collected in connection with any such foreclosure.

Interest on this Bond shall be payable from the Interest Payment Date next preceding the date of authentication hereof, unless (i) it is authenticated on an Interest Payment Date, in which event it shall bear interest from such Interest Payment Date, or (ii) such date of authentication is after a Record Date but on or prior to an Interest Payment Date, in which event interest will be payable from such Interest Payment Date, or (iii) such date of authentication is prior to the first Record Date, in which event interest will be payable from the Bond Date shown above; provided however, that if at the time of authentication of this Bond, interest is in default hereon, this Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment hereon.

Any tax for the payment hereof shall be limited to the Special Tax, except to the extent that provision for payment has been made by the City as may be permitted by law. The Bonds do not constitute obligations of the City for which the City is obligated to levy or pledge, or has levied or pledged, general or special taxation other than described herein above.

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, _____ 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, ______ through August 31, ______ 103%
September 1, ______ through August 31, ______ 102
September 1, ______ through August 31, ______ 101
September 1, ______ and any date thereafter 100
A-3
The Bonds are subject to mandatory redemption from 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 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
Interest Payment Dates through and including March 1, 2029 103% September 1, ______ and March 1, ______ 102
September 1, ______ and March 1, ______ 101
September 1, ______ and any Interest Payment Date
thereafter
100
The Term 2023 Bonds maturing September 1, _______, September 1, _____ and September 1, _____ are subject to mandatory sinking payment redemption in part on September 1, _______, September 1, _____ and September 1, _____, respectively, and on each September 1 thereafter to maturity, by lot, at a redemption price equal to 100% of the principal amount thereof to be redeemed, without premium, in the aggregate respective principal amounts as set forth in the following tables:

Term 2023 Bonds Maturing September 1, _____
Mandatory
Redemption Date
(Sept. 1)
Sinking Fund
Payment
(maturity)
A-4
Term 2023 Bonds Maturing September 1, _____
Mandatory
Redemption Date
(Sept. 1)
Sinking Fund
Payment
(maturity)
Term 2023 Bonds Maturing September 1, _____
Mandatory
Redemption Date
(Sept. 1)
Sinking Fund
Payment
(maturity)
The amounts in the foregoing tables will 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.

Notice of redemption with respect to the Bonds to be redeemed shall be given to the Owners thereof, in the manner, to the extent and subject to the provisions of the Agreement.

This Bond shall be registered in the name of the Owner hereof, as to both principal and interest. Each registration and transfer of registration of this Bond shall be entered by the Fiscal Agent in books kept by it for this purpose and authenticated by its manual signature upon the certificate of authentication endorsed hereon.

No transfer or exchange hereof shall be valid for any purpose unless made by the registered owner, by execution of the form of assignment endorsed hereon, and authenticated as herein provided, and the principal hereof, interest hereon and any redemption premium shall be payable only to the registered owner or to such Owner’s order. The Fiscal Agent shall require the Owner requesting transfer or exchange to pay any tax or other governmental charge required to be paid with respect to such transfer or exchange. No transfer or exchange hereof 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.

The Agreement and the rights and obligations of the City thereunder may be modified or amended as set forth therein. The principal of the Bonds is not subject to acceleration upon a default under the Agreement or any other document. This Bond shall not become valid or obligatory for any purpose until the certificate of authentication hereon endorsed shall have been dated and manually signed by the Fiscal Agent. It is hereby certified, recited and declared that all acts, conditions and things required by law to exist, happen and be performed precedent to and in the issuance of this Bond have existed, happened and been performed in due time, A-5
form and manner as required by law, and that the amount of this Bond, together with all other indebtedness of the City, does not exceed any debt limit prescribed by the laws or Constitution of the State of California.

Unless this Bond is presented by an authorized representative of The Depository Trust Company to the Fiscal Agent for registration of transfer, exchange or payment, and any Bond issued is registered in the name of Cede & Co. or such other name as requested by an authorized representative of The Depository Trust Company and any payment is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein.

IN WITNESS WHEREOF, the City of Roseville has caused this Bond to be executed by the facsimile signatures of the Mayor and the City Clerk of the City, all as of the Bond Date stated above.

CITY OF ROSEVILLE, for and on behalf of the

CITY OF ROSEVILLE CREEKVIEW
COMMUNITY FACILITIES DISTRICT NO. 1
(PUBLIC FACILITIES)
By:

Mayor
By:

City Clerk
FISCAL AGENT’S CERTIFICATE OF AUTHENTICATION
This is one of the Bonds described in the Resolution and the Agreement.

Dated: _____________, 2023
U.S. BANK TRUST COMPANY, NATIONAL
ASSOCIATION, as Fiscal Agent
By:

Authorized Signatory
A-6

ASSIGNMENT
FOR VALUE RECEIVED, the undersigned do(es) hereby sell, assign and transfer unto (Name, address and Tax Identification Number of Assignee) the within-mentioned registered Bond and hereby irrevocably constitute(s) and appoint(s) , attorney,
to transfer the same on the registration books of the Fiscal Agent with full power of substitution in the premises.

Dated:

Signature Guaranteed:

NOTE: Signature(s) must be guaranteed by a
member firm of the New York Stock Exchange or
a commercial bank or trust company.

NOTE: The signature(s) on this Assignment must
correspond with the name(s) as written on the face of
the within Bond in every particular without alteration or enlargement or any change whatsoever.

B-1

EXHIBIT B
$______________
City of Roseville
Creekview Community Facilities District No. 1 (Public Facilities) Improvement Area No. 2
Special Tax Bonds, Series 2023
OFFICER’S CERTIFICATE REQUESTING DISBURSEMENT

FROM THE IMPROVEMENT FUND
REQUISITION NO. _____
The undersigned hereby states and certifies that:
(i) I am an “Authorized Officer” of the City, as such term is defined in that certain Fiscal Agent Agreement, dated as of July 1, 2023 (the “Fiscal Agent Agreement”), by and between the City and U.S. Bank Trust Company, National Association, as fiscal agent (the “Fiscal Agent”) and as such, am familiar with the facts herein certified and am authorized to certify the same;
(ii) under Section 3.04(B) of the Fiscal Agent Agreement, the undersigned hereby requests and authorizes the Fiscal Agent to disburse from the Improvement Fund established under the Fiscal Agent Agreement to each payee designated on Schedule A attached hereto and by this reference incorporated herein, the amount set forth opposite such payee, for payment or reimbursement of previous payment of a Project cost (as that term is defined in the Fiscal Agent Agreement) as described on attached Schedule A; (iii) an obligation in the stated amount has been properly incurred and each such obligation is a proper charge against the Improvement Fund and has not been subject of any previous requisition of the City requesting disbursement; (iv) there has not been filed with or served upon the City a stop notice or any other notice of any lien, right to lien or attachment upon, or claim affecting the right to receive payment of, any of the money payable to the person named in this Officer’s Certificate, which has not been released or will not be released with the payment of such obligation, other than materialmen’s or mechanics’ liens accruing by mere operation of laws; and (v) in the case of each payment made under any contract for installation or construction, insofar as such obligation was incurred for work, materials, equipment or supplies, such work was actually performed or such materials, equipment or supplies were actually installed in furtherance of the Project or delivered at the site for that purpose or delivered for storage or fabrication at a place or places approved by the City.

Dated: __________, 20__ CITY OF ROSEVILLE
By:

Authorized Officer
B-2

SCHEDULE A
Payee Name and Address Purpose of Obligation Amount
Jones Hall draft of May 26, 2023
PRELIMINARY OFFICIAL STATEMENT DATED ____________, 2023 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 certain qualifications described herein, under existing law, the interest on the 2023 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.
$______________*

CITY OF ROSEVILLE
CREEKVIEW COMMUNITY FACILITIES DISTRICT NO. 1 (PUBLIC FACILITIES) IMPROVEMENT AREA NO. 2

SPECIAL TAX BONDS
SERIES 2023
Dated: Date of Delivery Due: September 1, as shown on inside cover The bonds captioned above (the “2023 Bonds”), are being issued by the City of Roseville (the “City”) by and through Improvement Area No. 2 (“Improvement Area No. 2”) of the City of Roseville Creekview Community Facilities District No. 1 (Public Facilities) (the “District”). The 2023 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 “Act”), and are issued pursuant to the Resolution of Issuance (as defined herein) and a Fiscal Agent Agreement dated as of July 1, 2023, (the “Fiscal Agent Agreement”) by and between the City and U.S. Bank Trust Company, National Association, as fiscal agent (the “Fiscal Agent”). The 2023 Bonds are being issued to (i) construct and/or acquire certain authorized public facilities, (ii) provide for a deposit to a debt service reserve account for the 2023 Bonds, (iii) pay capitalized interest on the 2023 Bonds through September 1, 2023 and (iv) pay costs of issuance of the 2023 Bonds. Interest on the 2023 Bonds is payable semiannually on March 1 and September 1 of each year, commencing September 1, 2023. The 2023 Bonds represent the first series of special tax bonds issued for Improvement Area No. 2 and the issuance of additional parity bonds in the future is contemplated, subject to the conditions set forth in the Fiscal Agent Agreement. See “THE BONDS – Authority for Issuance” and “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Future Parity Bonds.” The 2023 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. See “APPENDIX G – DTC AND THE BOOK-ENTRY ONLY SYSTEM.” The 2023 Bonds are secured by and payable from a pledge of Special Tax Revenues (as defined herein) derived from Special Taxes (as defined herein) to be levied by the City on real property within Improvement Area No. 2, from the proceeds of any foreclosure actions brought following a delinquency in the payment of the Special Taxes, and from amounts held in certain funds under the Fiscal Agent Agreement, all as more fully described herein. 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 a Special Tax even though financially able to do so. To provide funds for payment of the 2023 Bonds and the interest thereon as a result of any delinquent Special Taxes, the City will establish a debt service reserve account for the 2023 Bonds from proceeds of the 2023 Bonds, as described herein. See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS.”
Property currently in Improvement Area No. 2 and subject to the Special Tax is proposed to be developed into 561 taxable residential units, which represents “phase 3” and “phase 4” of the “Winding Creek” development ongoing within the Creekview Specific Plan, located in the northwest portion of the City. Final maps creating the 4 villages within phase 3 were recorded in August 2022, with final maps creating the 4 villages in phase 4 anticipated to record in September 2024. Anthem United Creekview Developments Limited Partnership, a Washington limited partnership (the “Master Developer”), which is the master developer of the project, has sold all 4 villages in phase 3 to merchant builders, as described herein. See “IMPROVEMENT AREA NO. 2 PLANNED DEVELOPMENT,” “THE MASTER DEVELOPER,” and “MERCHANT BUILDER INFORMATION.” The 2023 Bonds are subject to optional and mandatory redemption prior to maturity as described herein. See “THE BONDS – Redemption.”

NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE CITY, THE COUNTY OF PLACER, THE STATE OF CALIFORNIA OR ANY POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE 2023 BONDS. THE 2023 BONDS DO NOT CONSTITUTE A DEBT OF THE CITY WITHIN THE MEANING OF ANY STATUTORY OR CONSTITUTIONAL DEBT LIMITATION. THE INFORMATION SET FORTH IN THIS OFFICIAL STATEMENT, INCLUDING INFORMATION UNDER THE HEADING “SPECIAL RISK FACTORS,” SHOULD BE READ IN ITS ENTIRETY.

This cover page contains certain information for general reference only. It is not a summary of all of the provisions of the 2023 Bonds.

Prospective investors must read the entire Official Statement to obtain information essential to the making of an informed investment decision.

See “SPECIAL RISK FACTORS” herein for a discussion of the special risk factors that should be considered, in addition to the other matters and risk factors set forth herein, in evaluating the investment quality of the 2023 Bonds.

The 2023 Bonds are offered when, as and if issued, subject to approval as to their legality by Jones Hall, a Professional Law Corporation, San Francisco, California, Bond Counsel. Certain legal matters will also be passed on by Jones Hall, as Disclosure Counsel, Stradling, Yocca, Carlson & Rauth, a Professional Corporation, Newport Beach, California, as counsel to the Underwriter, and Holland & Knight LLP, San Francisco, California, as counsel to the Master Developer. Certain legal matters will be passed upon for the City by the City Attorney. It is anticipated that the 2023 Bonds will be available for delivery to DTC on or about July ___, 2023. [Piper Sandler logo]
The date of this Official Statement is ________, 2023.
_______________
* Preliminary; subject to change.

This Preliminary Official Statement and the information contained herein are subject to completion or amendment. Under no circumstances shall this Preliminary Official Statement constitute 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 qualification under the securities laws of such jurisdiction.

CITY OF ROSEVILLE
CREEKVIEW COMMUNITY FACILITIES DISTRICT NO. 1 (PUBLIC FACILITIES) IMPROVEMENT AREA NO. 2

SPECIAL TAX BONDS
SERIES 2023

MATURITY SCHEDULE
Maturity
(Sept. 1)
Principal
Amount
Interest
Rate Yield Price
CUSIP†
(______)
$__________ _____% Term Bond Due September 1, 20___; Yield ____%; Price: ____% CUSIP†: _________
† CUSIP® is a registered trademark of the American Bankers Association. CUSIP Global Services (CGS) is managed on behalf of the American Bankers Association by FactSet Research Systems Inc. Copyright (c) 2023 CUSIP Global Services.

All rights reserved. CUSIP® data herein is provided by CUSIP Global Services. This data is not intended to create a database and does not serve in any way as a substitute for the CGS database. CUSIP® numbers are provided for convenience of reference only. None of the City, the Underwriters or their agents or counsel take any responsibility for the accuracy of such numbers.

CITY OF ROSEVILLE, CALIFORNIA
City Council
Bruce Houdesheldt, Mayor (District 3)
Krista Bernasconi, Vice Mayor (District 4)
Scott Alvord, Councilmember (District 5)
Tracy Mendonsa, Councilmember (District 1)
Pauline Roccucci, Councilmember (District 2)
City Staff
Dominick Casey, City Manager
Dennis Kauffman, Assistant City Manager/Chief Financial Officer Michelle Sheidenberger, City Attorney
Carmen Avalos, City Clerk
____________________________

SPECIAL SERVICES
Bond Counsel and Disclosure Counsel
Jones Hall, A Professional Law Corporation
San Francisco, California
Municipal Advisor
Hilltop Securities Inc.

Encino, California
Special Tax Consultant and Administrator
Willdan Financial Services
Temecula, California
Appraiser
Integra Realty Resources
Sacramento, California
Fiscal Agent
U.S. Bank Trust Company, National Association
San Francisco, California

GENERAL INFORMATION ABOUT THIS OFFICIAL STATEMENT
Use of Official Statement. This Official Statement is submitted in connection with the sale of the 2023 Bonds referred to herein and may not be reproduced or used, in whole or in part, for any other purpose. This Official Statement is not to be construed as a contract with the purchasers of the 2023 Bonds.

Estimates and Forecasts. When used in this Official Statement and in any continuing disclosure by the City, in any press release and in any oral statement made with the approval of an authorized officer of the City, the words or phrases “will likely result,” “are expected to”, “will continue”, “is anticipated”, “estimate”, “project,” “forecast”, “expect”, “intend” and similar expressions identify “forward looking statements.” Such statements are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated in such forward-looking statements. Any forecast is subject to such uncertainties. Inevitably, some assumptions used to develop the forecasts will not be realized and unanticipated events and circumstances may occur. Therefore, there are likely to be differences between forecasts and actual results, and those differences may be material. The information and expressions of opinion herein are subject to change without notice, and neither the delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, give rise to any implication that there has been no change in the affairs of the City since the date hereof.

Limit of Offering. No dealer, broker, salesperson or other person has been authorized by the City to give any information or to make any representations in connection with the offer or sale of the 2023 Bonds other than those contained herein and if given or made, such other information or representation must not be relied upon as having been authorized by the City or the Underwriter. This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the 2023 Bonds by a person in any jurisdiction in which it is unlawful for such person to make such an offer, solicitation or sale.

Involvement of Underwriter. The Underwriter has reviewed the information in this Official Statement in accordance with, and as a part of, their responsibilities to investors under the Federal Securities Laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information. The information and expressions of opinions herein are subject to change without notice and neither delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the City since the date hereof. All summaries of the documents referred to in this Official Statement, are made subject to the provisions of such documents, respectively, and do not purport to be complete statements of any or all of such provisions.

IN CONNECTION WITH THIS OFFERING, THE UNDERWRITER MAY OVERALLOT OR

EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE 2023 BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.

THE 2023 BONDS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, IN RELIANCE UPON AN EXCEPTION FROM THE REGISTRATION REQUIREMENTS CONTAINED IN SUCH ACT. THE 2023 BONDS HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES LAWS OF ANY STATE.

TABLE OF CONTENTS
Page Page
INTRODUCTION ............................................... 1

ESTIMATED SOURCES AND USES OF
FUNDS............................................................... 7 THE BONDS...................................................... 8 Authority for Issuance..................................... 8 Description of the Bonds ................................ 8 Redemption*................................................... 9 Transfer or Exchange of Bonds.................... 12

SECURITY AND SOURCES OF PAYMENT
FOR THE BONDS ........................................... 12 Special Taxes ............................................... 12 Special Tax Methodology ............................. 14 Levy of Annual Special Tax; Maximum Special
Tax............................................................. 15 Special Tax Fund.......................................... 16 Delinquent Payments of Special Tax; Covenant
for Superior Court Foreclosure.................. 17
2023 Reserve Account of the Reserve Fund 19
Improvement Fund........................................ 20 Future Parity Bonds...................................... 21 DEBT SERVICE SCHEDULE.......................... 23
THE CREEKVIEW SPECIFIC PLAN............... 24
IMPROVEMENT AREA NO. 2 PLANNED
DEVELOPMENT.............................................. 29 The Creekview Development ....................... 29
Development Agreement.............................. 33
Environmental Matters.................................. 37 THE MASTER DEVELOPER .......................... 37
General ......................................................... 37 Master Developer Financing Plan ................ 38
Cash Flow Statement ................................... 41 MERCHANT BUILDER INFORMATION ......... 42
Lennar Homes .............................................. 42 Woodside...................................................... 44 Meritage........................................................ 46 D.R. Horton................................................... 48 Increasing Mortgage Interest Rates and
Banking Uncertainty .................................. 51 Impact of Economic Conditions on the
Development in Improvement Area No. 2. 51

VALUE OF PROPERTY WITHIN
IMPROVEMENT AREA NO. 2......................... 52
The Appraisal ................................................52 Value to Special Tax Burden Ratios .............54
No History of Special Tax Collections...........56
Overlapping Liens and Priority of Lien ..........56
Estimated Overall Tax Burden ......................58
SPECIAL RISK FACTORS...............................59
Limited Obligation of the City to Pay Debt
Service........................................................59 Concentration of Ownership..........................59
Appraised Values ..........................................59 Property Values and Property Development.60
Levy and Collection of Special Taxes ...........63
FDIC/Federal Government Interests in
Properties ...................................................65 Bankruptcy and Foreclosure Delays .............65
Parity Taxes and Special Assessments; Private
Debt............................................................67 Tax Delinquencies.........................................68 No Acceleration Provisions ...........................69 Ballot Initiatives..............................................69 Voter Initiatives..............................................69 Case Law Related to the Mello-Roos Act .....70
Exempt Properties.........................................71 Changes in Tax Law......................................72 Pandemic Diseases.......................................72 Cyber Security...............................................72 Potential Early Redemption of Bonds from
Prepayments ..............................................72

CONSTITUTIONAL LIMITATIONS ON
TAXATION AND APPROPRIATIONS..............73
CONTINUING DISCLOSURE ..........................74
The City .........................................................74 The Master Developer...................................74 The Merchant Builders ..................................75 UNDERWRITING .............................................76 MUNICIPAL ADVISOR.....................................76 LEGAL OPINION..............................................76 TAX MATTERS ................................................76 NO RATINGS ...................................................78 NO LITIGATION ...............................................78 EXECUTION.....................................................79 APPENDIX A – RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX APPENDIX B – THE APPRAISAL
APPENDIX C – THE CITY OF ROSEVILLE AND PLACER COUNTY
APPENDIX D – FORM OF OPINION OF BOND COUNSEL
APPENDIX E – FORMS OF CONTINUING DISCLOSURE UNDERTAKINGS APPENDIX F – SUMMARY OF CERTAIN PROVISIONS OF FISCAL AGENT AGREEMENT APPENDIX G – DTC AND THE BOOK-ENTRY ONLY SYSTEM
1 OFFICIAL STATEMENT
$______________*

CITY OF ROSEVILLE
CREEKVIEW COMMUNITY FACILITIES DISTRICT NO. 1 (PUBLIC FACILITIES) IMPROVEMENT AREA NO. 2

SPECIAL TAX BONDS
SERIES 2023
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 Roseville (the “City”) by and through Improvement Area No. 2 (“Improvement Area No. 2”) of the City or Roseville Creekview Community Facilities District No. 1 (Public Facilities) (the “District”) of the bonds captioned above (the “2023 Bonds”).

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 have the meaning set forth in the Fiscal Agent Agreement. See “APPENDIX F – SUMMARY OF CERTAIN PROVISIONS OF FISCAL AGENT AGREEMENT.

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 2023 Bonds to potential investors is made only by means of the entire Official Statement.

The City. The City is located in the Sacramento Valley near the foothills of the Sierra Nevada mountain range, about 16 miles northeast of Sacramento and 110 miles east of San Francisco. With an estimated population as of January 1, 2022 of approximately 151,034, the City is the largest city in Placer County (the “County”). For economic and demographic information regarding the area in and around the City, see “APPENDIX C – The City of Roseville and Placer County.”
The District and Improvement Area No. 2. On October 2, 2019, the City Council of the City (the “City Council”), as legislative body of the District, adopted a Resolution of Intention to form the District, and designate Improvement Area No. 1 as an improvement area therein, under the Mello-Roos Community Facilities Act of 1982, as amended (the “Act”), to levy a special tax and to incur bonded indebtedness for the purpose of financing certain authorized facilities. After _________________
* Preliminary; subject to change.
2 conducting a noticed public hearing, on November 6, 2019, the City Council adopted a Resolution of Formation (the “Resolution of Formation”), which established the District, designated Improvement Area No. 1 as an improvement area therein, and formed a future annexation area for the District (the “Future Annexation Area”). In July 2022, the Master Developer (defined below) annexed a portion of the land (comprising phase 3 and phase 4 of the development) within the Future Annexation Area into the District as Improvement Area No. 2, approved the levy of special taxes pursuant to the Special Tax Formula (defined below), and established a bonded indebtedness limit for Improvement Area No. 2 of $111,000,000.

The Master Developer and the Development. Property currently in Improvement Area No. 2 and subject to the Special Tax is proposed to be developed into 561 taxable residential units, which represents “phase 3” and “phase 4” of the “Winding Creek” development ongoing within the Creekview Specific Plan, located in the northwest portion of the City. Final maps creating the 4 villages within phase 3 recorded in August 2022. Final maps creating the lots within the 4 villages planned for phase 4 are anticipated to record in September 2024. Land in Improvement Area No. 2 also includes 168 HDR units designated as affordable units as part of “phase 3” of the project, which are not subject to the Special Tax and provide no security for repayment of the 2023 Bonds. Anthem United Creekview Developments Limited Partnership, a Washington limited partnership (the “Master Developer”), which is the master developer of the project, has sold all 4 villages in phase 3 to merchant builders, as described herein. The Master Developer owns the remaining taxable property in Improvement Area No. 2, consisting of large lots C-6, C-7, C-8 and C-20, which will be developed as “phase 4” of the project. See “IMPROVEMENT AREA NO. 2 PLANNED DEVELOPMENT” and “THE MASTER DEVELOPER.” Land in Improvement Area No. 2 represents a portion of the larger “Winding Creek” development. Home building and sales in Improvement Area No. 1, which represents “phase 1” and “phase 2” of the project, is well underway, with 381 of the 544 total planned single-family residential units having sold and closed to individual homeowners as of May 2023. Phase 5 of the project (planned for an additional 285 single-family residential units) remains in the Future Annexation Area and will be the final phase to develop. Only the land in Improvement Area No. 2 is security for the 2023 Bonds.

The Merchant Builders. Of the planned 561 taxable lots in Improvement Area No. 2, 330 lots, comprising all of “Phase 3” of the project have been acquired by the following merchant builders (collectively, the “Merchant Builders”): Lennar Homes of California, LLC, a California limited liability company (“Lennar Homes”) (large lot C-5, planned for 74 homes); Meritage Homes of California, Inc., a California corporation (“Meritage”) (large lot C-22, planned for 82 homes); Woodside 05N LP, a California limited partnership (“Woodside”) (large lot C-9, planned for 97 homes); and Winding Creek C-21 – Roseville, L.P., a California limited partnership (“Hearthstone Landbank”), the land bank for D.R. Horton CA2, Inc., a California corporation (“D.R. Horton”) (large lot C-21, planned for 77 homes). The table on the following page shows the projected special tax levies for Fiscal Year 2023-24, by ownership. For additional details, see “IMPROVEMENT AREA NO. 2 PLANNED DEVELOPMENT” and “MERCHANT BUILDER INFORMATION.”
3 Ownership / Development
Status / Village / Land Use (1)
No. of
Parcels
Planned
Units
Appraised
Value (2)
FY 2023-24
Maximum
Tax (3)
Projected
FY 2023-24
Special Tax
Levy * (4)
Allocable Debt
CFD Bonds *
(5)(6)
% of
Total CFD
Bonded
Debt (6)
Phase 3
Merchant Builders - Finished Lots
C-5 (LDR) Lennar Homes 74 74 $10,730,000 $234,818 $225,301 $3,898,504 24.99% C-9 (LDR) Woodside Homes 97 97 14,550,000 307,802 295,326 5,110,183 32.76% C-21 (MDR) D.R. Horton 77 77 8,778,000 192,266 184,472 3,192,017 20.46% C-22 (MDR) Meritage Homes 82 82 10,004,000 204,751 196,451 3,399,296 21.79% Total Phase 3 330 330 $44,062,000 $939,637 $901,550 $15,600,000 100.00% Phase 4
Master Developer - Undeveloped
C-6 (LDR) 1 48 $2,714,352 $152,315 $0 $0 0.00%
C-7 (LDR) 1 74 4,184,626 234,818 0 0 0.00%
C-8 (LDR) 1 32 1,809,568 101,543 0 0 0.00%
C-20 (MDR) 1 77 3,501,454 192,266 0 0 0.00%
Total Phase 4 4 231 $12,210,000 $680,942 $0 $0 0.00%
Total 334 561 $56,272,000 $1,620,579 $901,550 $15,600,000 100.00% ___________________________________
* Preliminary, subject to change.
(1) Ownership, Development Status and Land Use as of May 1, 2023. (2) Appraised Values as of May 1, 2023.
(3) Maximum Tax refers to Maximum Annual Facilities Special Tax. (4) Special Tax refers to Special Facilities Tax.
(5) Represents the par amount of the 2023 Bonds.
(6) The value to lien ratios of the 4 undeveloped parcels comprising of Phase 4 are shown as "N/A" since this table allocates CFD Bonded Debt using each parcel's share of the projected FY 2023-24 Special Tax levy and none of the Phase 4 territory is expected to be levied in FY 2023-24. Should the appraised value of the Phase 4 parcels be considered in the Improvement Area's overall value to lien ratio, it would be 3.56 to 1.

Authority for Issuance of the 2023 Bonds. The 2023 Bonds are issued pursuant to the Act, a resolution adopted by the City Council on _________, 2023 (the “Resolution of Issuance”) and a Fiscal Agent Agreement dated as of July 1, 2023, (the “Fiscal Agent Agreement”), between the City and U.S. Bank Trust Company, National Association, as fiscal agent (the “Fiscal Agent”).

Bond Terms. The 2023 Bonds will be dated as of and bear interest from the date of delivery thereof at the rate or rates set forth on the cover page of this Official Statement. Interest on the 2023 Bonds is payable on March 1 and September 1 of each year (each an “Interest Payment Date”), commencing September 1, 2023. The 2023 Bonds will be issued without coupons in denominations of $5,000 or any integral multiple thereof.

The 2023 Bonds have been sized to provide an estimated 110% annual debt service coverage ratio from Special Tax Revenues for the 2023 Bonds based on the Maximum Annual Facilities Special Tax generated by the 330 taxable parcels within “phase 3” of Improvement Area No. 2, although all the land in Improvement Area No. 2 provides security for the 2023 Bonds.

Additional Bonds, secured on parity with the 2023 Bonds, are expected to be issued to finance the acquisition and/or construction of additional Improvements in the future.

Registration of Ownership of 2023 Bonds. The 2023 Bonds will be 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”). Ultimate purchasers of 2023 Bonds will not receive physical certificates representing their interest in the 2023 Bonds. So long as the 2023 Bonds are registered in the name of Cede & Co., as nominee of DTC, references herein to the Owners will 4 mean Cede & Co. and will not mean the ultimate purchasers of the 2023 Bonds. Payments of the principal, premium, if any, and interest on the 2023 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 2023 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 2023 Bonds will primarily be used to finance a portion of the costs of acquiring and constructing certain authorized infrastructure improvements (the “Improvements,” as described herein) as part of the development being undertaken by the Master Developer. The Improvements consist generally of roadway, water, wastewater, drainage, and other infrastructure improvements necessary for development of property within the District, as well as park and open space improvements. Proceeds of the 2023 Bonds will also be deposited to a debt service reserve account for the 2023 Bonds, and to pay costs of issuance and to pay capitalized interest through September 1, 2023.

Security and Source of Payment of the 2023 Bonds. As security for the payment of the 2023 Bonds, a facilities special tax applicable to each taxable parcel in Improvement Area No. 2 will be levied and collected according to the facilities tax liability determined by the City Council through the application of the Rate, Method of Apportionment, and Manner of Collection of Special Tax for Improvement Area No. 2 (the “Special Tax Formula”). The Special Tax Formula is set forth in its entirety in APPENDIX A hereto. The Special Tax Formula includes a services special tax component which is not security for the 2023 Bonds. Pursuant to the Special Tax Formula, a “Facilities Special Tax” will be levied and collected until the earlier of (i) the “Transition Year” (defined herein) or (ii) Fiscal Year 2086-87, and a “Maintenance Special Tax” will be levied and collected in perpetuity beginning in the Transition Year. Only the “Facilities Special Tax” is pledged to the payment of the 2023 Bonds, and the definition of “Special Taxes” used in the Fiscal Agent Agreement and this Official Statement refers only to the “Facilities Special Tax” levied in accordance with the Special Tax Formula. See “SECURITY AND SOURCES OF PAYMENT OF THE BONDS – Special Tax Methodology.”
The 2023 Bonds and any Additional Bonds that may be issued in the future pursuant to the terms of the Fiscal Agent Agreement are payable from the “Special Tax Revenues,” consisting of the proceeds of the Special Taxes received by the City, including all scheduled payments and delinquent payments thereof, interest thereon and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes, net of the administration charge of the County (currently at 1%), but do not include any interest in excess of the interest due on the Bonds or any penalties collected in connection with any such foreclosure.

The 2023 Bonds are also payable from amounts held in certain funds and accounts pursuant to the Fiscal Agent Agreement, including a debt service reserve account, all as more fully described herein.

The Special Tax represents a lien on each parcel of land subject to the Special Tax, and failure to pay the Special Taxes could result in proceedings to foreclose the delinquent parcel.

The Special Taxes do not constitute the personal indebtedness of the owners of taxed parcels.

See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS.”
Additional Parity Bonds. The maximum authorized indebtedness for Improvement Area No. 2 is $111,000,000, and the 2023 Bonds represent the first series of special tax bonds issued under this authorization. As development progresses one or more additional series of parity bonds 5 may be issued in the future to finance additional infrastructure improvements needed for the development of the project being undertaken by the Master Developer. In addition, the City may utilize a portion of the available authorized bond amount for the funding of certain deferred impact fees owed to the City, as described below under “– Use of Bond Authorization for Development Impact Fee Deferral Bonds.”
The District may issue additional bonds secured by Special Tax Revenues on parity with the 2023 Bonds (the “Additional Bonds,” and collectively, the “Bonds”), upon the satisfaction of certain conditions set forth in the Fiscal Agent Agreement. Following the issuance of the 2023 Bonds in the amount of $______________*, the remaining authorized amount of indebtedness to be issued is $______________*. Additional Bonds are expected to be issued in the future for additional Improvements, including bonds which may be issued to pay for the Development Impact Fee Deferral (see the following paragraph). The actual aggregate amount of Additional Bonds to fund Improvements and the Development Impact Fee Deferral may vary depending on interest rates at the time of bond issuance, the timing of each bond issue and other factors that may impact the timing and size of each bond issue. So long as the 2023 Bonds are outstanding, issuance of any Additional Bonds must comply with certain conditions set forth in the Fiscal Agent Agreement, and no bonds having a lien senior to the lien of the 2023 Bonds are allowed. See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Future Parity Bonds.” Use of Bond Authorization for Development Impact Fee Deferral Bonds. In connection with the approval of development in the District (including Improvement Area No. 2), the City agreed that payment of certain impact fees owed by the Master Developer and merchant builders will be deferred (referred to as the “Development Impact Fee Deferral” in the Special Tax Formula) to allow payment of the deferred fees after the 2023 Bonds have been fully paid. The City expects to receive payment for the deferred impact fees either through continued collection of Special Taxes or through the issuance of future bonds after the 2023 Bonds and any Additional Bonds issued during the Initial Bonding Period have matured. If the City chooses to issue bonds to pay deferred impact fees, the remaining authorization will be available to be utilized by the City as a means therefor.
2023 Reserve Account of the Reserve Fund. A debt service reserve fund has been established under the Fiscal Agent Agreement (the “Reserve Fund”), and within the Reserve Fund, separate reserve accounts are being established for each series of Bonds. Accordingly, at the time of issuance of the 2023 Bonds, a reserve account will be established within the Reserve Fund for the benefit of the holders of the 2023 Bonds (the “2023 Reserve Account”). The 2023 Reserve Account is available solely for the payment of debt service on the 2023 Bonds and no other parity obligations. See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – 2023 Reserve Account of the Reserve Fund.”
Appraised Value of Property. Property in Improvement Area No. 2 is security for the Special Tax that secures the Bonds. The City authorized the preparation of an appraisal report (the “Appraisal”) for certain real property within Improvement Area No. 2, which sets forth an aggregate value of appraised taxable property currently in Improvement Area No. 2 of $56,272,000, as of May 1, 2023. The valuation assumes completion of the Improvements funded by the 2023 Bonds (but not any Additional Bonds that may be issued in the future) and accounts for the impact of the lien of the Special Tax on the value of the property. In considering the ____________
* Preliminary; subject to change.
6 estimates of value evidenced by the Appraisal, it should be noted that the Appraisal is based upon a number of standard and special assumptions, which affect the estimates as to value. See “VALUE OF PROPERTY WITHIN IMPROVEMENT AREA NO. 2 – The Appraisal” and APPENDIX B.

The appraised value of property in Improvement Area No. 2 is 3.56 times the $15,792,437* aggregate principal amount of the 2023 Bonds ($15,600,000*) and overlapping general obligation bond debt ($192,437). This is based on the entirety of Improvement Area No. 2, the value to lien ratio for individual parcels will vary from the average. See “VALUE OF PROPERTY WITHIN IMPROVEMENT AREA NO. 2 – Value to Special Tax Burden Ratios.” Risks of Investment; COVID-19. See the section of this Official Statement entitled “SPECIAL RISK FACTORS” 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 2023 Bonds. In particular, no assurance can be given that the timing of construction of homes and/or sale of homes projected by the Master Developer or the Merchant Builders in this Official Statement will be accomplished. Neither the City nor the Underwriter can predict the impact of COVID-19 on home production and home sales activities or the willingness of owners of land in the District, including the Master Developer, the Merchant Builders, or any subsequent owners, to pay the Special Taxes securing the 2023 Bonds. See “SPECIAL RISK FACTORS – Pandemic Diseases.”
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 2023 Bonds. The 2023 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 money in the funds established and pledged to the 2023 Bonds under the Fiscal Agent Agreement, and neither the payment of the interest on nor principal of or redemption premiums, if any, on the 2023 Bonds is a general debt, liability or obligation of the City. The 2023 Bonds do not constitute an indebtedness of the City within the meaning of any constitutional or statutory debt limitation or restrictions, and neither the City Council, the City nor any officer or employee thereof are liable for the payment of the interest on or principal of or redemption premiums, if any, on the 2023 Bonds other than from the proceeds of the Special Taxes and the money in the funds established and pledged to the 2023 Bonds, as provided in the Fiscal Agent Agreement.

Summary of Information. Brief descriptions of certain provisions of the Fiscal Agent Agreement, the Bonds 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 Chief Financial Officer 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. 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 have been no changes to the City or the land in Improvement Area No. 2 since the date hereof. Any statements made in this Official Statement involving matters of opinion or of estimates, whether or not so 7 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.

ESTIMATED SOURCES AND USES OF FUNDS
A summary of the estimated sources and uses of funds associated with the sale of the 2023 Bonds follows:

Estimated Sources of Funds:

Principal Amount of 2023 Bonds $
Plus/Less: [Net] Original Issue Premium/Discount
Total $
Estimated Uses of Funds:

Deposit to Improvement Fund $
Deposit to Bond Fund(1)
Deposit to 2023 Reserve Account of the Reserve Fund(2)
Costs of Issuance(3)
Total $
(1) To pay capitalized interest on the 2023 Bonds through September 1, 2023. (2) Equal to the initial Reserve Requirement for the 2023 Bonds. (3) Includes fees of bond and disclosure counsel, fees, expenses and charges of the Fiscal Agent and its counsel, printing costs, fees of the special tax consultant and administrator, Appraiser, and Municipal Advisor, Underwriter’s discount, and other costs of issuance.
8 THE BONDS
Authority for Issuance
The 2023 Bonds are issued pursuant to the Fiscal Agent Agreement, the Resolution of Issuance and the Act.

Additional Bonds, secured on parity with the 2023 Bonds, are expected to be issued to finance the acquisition and/or construction of additional Improvements in the future. See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Future Parity Bonds.” Description of the Bonds
Bond Terms. The 2023 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 2023 Bonds are being issued in the denomination of $5,000 or any integral multiple thereof.

Interest on the 2023 Bonds will be payable semiannually on March 1 and September 1 of each year (each an “Interest Payment Date”), commencing September 1, 2023. The principal of the 2023 Bonds and premiums due upon the redemption thereof, if any, will be payable in lawful money of the United States of America at the designated principal corporate trust office of the Fiscal Agent in Los Angeles, California, or such other place as designated by the Fiscal Agent, upon presentation and surrender of the 2023 Bonds; provided that so long as any 2023 Bonds are in book-entry form, payments with respect to such 2023 Bonds will be made by wire transfer, or such other method acceptable to the Fiscal Agent, to DTC.

Book-Entry Only System. The 2023 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 under the book-entry system maintained by DTC.

Ultimate purchasers of 2023 Bonds will not receive physical certificates representing their interest in the 2023 Bonds. So long as the 2023 Bonds are registered in the name of Cede & Co., as nominee of DTC, references herein to the Owners will mean Cede & Co., and will not mean the ultimate purchasers of the 2023 Bonds. The Fiscal Agent will make payments of the principal, premium, if any, and interest on the 2023 Bonds directly to DTC, or its nominee, Cede & Co., so long as DTC or Cede & Co. is the registered owner of the 2023 Bonds. Disbursements of such payments to DTC’s Participants are the responsibility of DTC and disbursements of such payments to the Beneficial Owners are the responsibility of DTC’s Participants and Indirect Participants, as more fully described herein. See “APPENDIX G – DTC AND THE BOOK-ENTRY ONLY SYSTEM.”
Calculation and Payment of Interest. Interest on the 2023 Bonds will be computed on the basis of a 360-day year consisting of twelve 30-day months. Interest on the 2023 Bonds (including the final interest payment upon maturity or 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 month preceding the month in 9 which the Interest Payment Date occurs whether or not such day is a Business Day (the “Record Date”) preceding the Interest Payment 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 2023 Bonds; provided that so long as any 2023 Bonds are in book-entry form, payments with respect to such 2023 Bonds will be made by wire transfer, or such other method acceptable to the Fiscal Agent, to DTC. See “APPENDIX G – DTC AND THE BOOK-ENTRY ONLY SYSTEM.”
Each 2023 Bond will 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 will 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 will 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 will bear interest from the Dated Date; provided, however, that if at the time of authentication of a 2023 Bond, interest is in default thereon, such 2023 Bond will bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon.

So long as the 2023 Bonds are registered in the name of Cede & Co., as nominee of DTC, payments of the principal, premium, if any, and interest on the 2023 Bonds will be made directly to DTC, or its nominee, Cede & Co. Disbursements of such payments to DTC’s Participants are the responsibility of DTC and disbursements of such payments to the Beneficial Owners are 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 2023 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 2023 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 2023 Bonds are subject to mandatory redemption from Prepayments of the Special Tax by property owners, in whole or in part among maturities of the 2023 Bonds and any Additional Bonds, as 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 2023 Bonds to be redeemed), plus accrued interest thereon to the date of redemption:
__________
* Preliminary; subject to change.
10 Redemption Dates
Redemption
Price
March 1, 2023 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 Prepayments and amounts released from the 2023 Reserve Account in connection with Prepayments will be allocated to the redemption of the 2023 Bonds and any Additional Bonds as nearly as practicable on a proportionate basis based on the outstanding principal amount of the 2023 Bonds and any Additional Bonds and shall be applied to redeem 2023 Bonds and Additional Bonds as nearly as practicable on a pro rata basis among maturities in increments of $5,000; provided, however, that, for Prepayments of less than $50,000, the City may specify that Prepayments be applied to one or more maturities of the 2023 Bonds or Additional Bonds so long as there is delivered to the Fiscal Agent a certification of a Special Tax consultant or administrator that, following such redemption from Prepayments, the maximum Special Taxes that may be levied in each Fiscal Year on Developed Property in Improvement Area No. 2 is not less than 110% of Maximum Annual Debt Service.

See “SPECIAL RISK FACTORS – Potential Early Redemption of Bonds from Prepayments” for a discussion of the potential for the 2023 Bonds to be priced with original issue premium and then be redeemed from Special Tax prepayments prior to maturity.

Mandatory Sinking Fund Redemption. The Term 2023 Bonds maturing September 1, 20__ and September 1, 20__ are subject to mandatory sinking payment redemption in part on September 1, 20__ and September 1, 20__, respectively, and on each September 1 thereafter to maturity, by lot, at a redemption price equal to 100% of the principal amount thereof to be redeemed, without premium, in the aggregate respective principal amounts as set forth in the following tables:

Term 2023 Bonds Maturing September 1, 20__
Mandatory
Redemption Date
(Sept. 1)
Sinking Fund
Payment
(maturity)
11 Term 2023 Bonds Maturing September 1, 20__
Mandatory
Redemption Date
(Sept. 1)
Sinking Fund
Payment
(maturity)
The amounts in the foregoing tables will 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 2023 Bonds.

Purchase In Lieu of Redemption. In lieu of redemption, moneys in the Bond Fund may be used and withdrawn by the Fiscal Agent for purchase of Outstanding 2023 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 2023 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 will 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 2023 Bonds designated for redemption, at their addresses appearing on the registration books in the Principal Office of the Fiscal Agent; but such mailing is not a condition precedent to such redemption and failure to mail or to receive any such notice, or any defect therein, will not affect the validity of the proceedings for the redemption of such 2023 Bonds.

Such notice will state the redemption date and the redemption price and, if less than all of the then Outstanding 2023 Bonds are to be called for redemption, will designate the CUSIP numbers and bond numbers of the 2023 Bonds to be redeemed by giving the individual CUSIP number and bond number of each 2023 Bond to be redeemed or will state that all 2023 Bonds between two stated bond numbers, both inclusive, are to be redeemed or that all of the 2023 Bonds of one or more maturities have been called for redemption, will state as to any 2023 Bond called in part the principal amount thereof to be redeemed, and will require that such 2023 Bonds be then surrendered at the Principal Office of the Fiscal Agent for redemption at the said redemption price, and will state that further interest on such 2023 Bonds will not accrue from and after the redemption date.

The City has the right to rescind any notice of the optional redemption of 2023 Bonds and such notice may 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 2023 Bonds then called for redemption.

Whenever provision is made in the Fiscal Agent Agreement for the redemption of less than all of the 2023 Bonds of any maturity, the City will select the 2023 Bonds to be redeemed, from all 2023 Bonds or such given portion thereof of such maturity by lot in any manner which the City in its sole discretion deems appropriate. Upon surrender of 2023 Bonds redeemed in part 12 only, the City will execute and the Fiscal Agent will authenticate and deliver to the registered Owner, at the expense of the City, a new 2023 Bond or 2023 Bonds, of the same series and maturity, of authorized denominations in aggregate principal amount equal to the unredeemed portion of the 2023 Bond or 2023 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 2023 Bonds so called for redemption are deposited in the Bond Fund, such 2023 Bonds so called will 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 will accrue thereon on or after the redemption date specified in such notice.

Transfer or Exchange of Bonds
So long as the 2023 Bonds are registered in the name of Cede & Co., as nominee of DTC, transfers and exchanges of 2023 Bonds will be made in accordance with DTC procedures. See “APPENDIX G – DTC AND THE BOOK-ENTRY ONLY SYSTEM.” Any 2023 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 2023 Bond for cancellation, accompanied by delivery of a duly written instrument of transfer in a form approved by the Fiscal Agent. Whenever any 2023 Bond or 2023 Bonds are surrendered for transfer or exchange, the City will execute and the Fiscal Agent will authenticate and deliver a new 2023 Bond or 2023 Bonds, for a like aggregate principal amount of 2023 Bonds of authorized denominations and of the same maturity. The cost for any services rendered or any fees or expenses incurred by the Fiscal Agent in connection with any such transfer or exchange will be paid by the City. The Fiscal Agent will 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 2023 Bonds will be required to be made (i) within 15 days prior to the date established by the Fiscal Agent for selection of 2023 Bonds for redemption or (ii) with respect to a 2023 Bond after such 2023 Bond has been selected for redemption.

SECURITY AND SOURCES OF PAYMENT FOR THE BONDS
Special Taxes
The Bonds (consisting of the 2023 Bonds and any Additional Bonds that may be issued in the future) are payable from and secured by proceeds of the Special Taxes received by the City, including all scheduled payments and delinquent payments thereof, interest and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes (but excluding any interest in excess of the interest due on the Bonds or any penalties collected in connection with any such foreclosure), and net of a 1% administration charge of the County (the “Special Tax Revenues”). All of the Special Tax Revenues and all moneys deposited in the Bond Fund and, until disbursed as provided herein, in the Special Tax Fund are pledged to secure the repayment of the Bonds. In addition, with respect to each Series of Bonds, all moneys in the applicable Reserve Account within the Reserve Fund for such Series is pledged to secure the repayment of the applicable Series, such that amounts in the 2023 Reserve Account are pledged to the 2023 Bonds. The Special Tax Revenues and all moneys deposited into such funds (except as otherwise provided in the Fiscal Agent Agreement) are dedicated to the payment of the principal of, including any mandatory sinking fund payments, and interest and any premium on, 13 the Bonds as provided in the Fiscal Agent Agreement and in the Act until all of the Bonds have been paid and retired or defeased in accordance with the Fiscal Agent Agreement.

A Special Tax applicable to each taxable parcel in Improvement Area No. 2 will be levied and collected according to the tax amount determined by the City Council through the application of the Special Tax Formula administered by Willdan Financial Services, Temecula, California (the “Special Tax Administrator”) and set forth in APPENDIX A hereto for all taxable properties in Improvement Area No. 2. Prior to remittance of the Special Tax collections to the City, the County deducts and retains a 1% County administration fee, as noted above. Interest and principal on the Bonds is payable from the annual Special Tax Revenues to be paid to the City from Special Tax levies and collections on taxable 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 Council, as legislative body of the District, pursuant to the Act in an amount determined according to the Special Tax Formula. See “– Special Tax Methodology” below and APPENDIX A.

The amount of Special Taxes that the City may levy in any year, and from which principal and interest on the Bonds is to be paid, is strictly limited by the maximum rates approved by the qualified electors within Improvement Area No. 2, which is set forth in the Special Tax Formula.

Under the Special Tax Formula, Special Taxes for the purpose of making payments on the Bonds will be levied annually in an amount not in excess of the maximum approved amount. The Special Taxes and any interest earned on the Special Taxes constitute a trust fund for the principal of and interest on the Bonds pursuant to the Fiscal Agent Agreement and, so long as the principal of and interest on these obligations remains unpaid, the Special Taxes and investment earnings thereon will not be used for any other purpose, except as permitted by the Fiscal Agent Agreement, and will be held in trust for the benefit of the owners thereof and will be applied pursuant to the Fiscal Agent Agreement. The Special Tax Formula apportions the Annual Facilities Costs (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 Methodology” below. See also “APPENDIX A – RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX.”
The City may levy the Special Tax up to the amount of the Maximum Annual Facilities Special Tax set forth in the Special Tax Formula, if conditions so require. The City has covenanted to annually levy the Special Taxes in an amount at least sufficient to pay the Annual Facilities Costs (as defined below). Because each Special Tax levy is limited to the Maximum Annual Facilities 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 Annual Facilities Costs will in fact be collected in any given year. In addition, Section 53321(d) of the 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. See “SPECIAL RISK FACTORS – Tax Delinquencies” 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.
14 Special Tax Methodology
Pursuant to the Special Tax Formula, a “Facilities Special Tax” will be levied and collected until the earlier of (i) the Transition Year (defined herein) or (ii) Fiscal Year 2086-87, and a “Maintenance Special Tax” will be levied and collected in perpetuity beginning in the Transition Year. Only the “Facilities Special Tax” is pledged to the payment of the Bonds, and the definition of “Special Taxes” used in the Fiscal Agent Agreement and this Official Statement refers only to the “Facilities Special Tax” levied in accordance with the Special Tax Formula. Capitalized terms set forth in this section and not otherwise defined have the meanings set forth in the Special Tax Formula.

Determination of Annual Facilities Costs. Each year, the City will determine the Annual Facilities Costs for the upcoming Fiscal Year. The “Annual Facilities Costs” includes the following amounts (less any available earnings on any reserve fund, special tax funds, available capitalized interest or any other available revenues):
(i) Debt Service to be paid from Facilities Special Taxes; (ii) the amount needed to replenish bond reserve funds to the level required by Bond documents, to the extent not included in a computation of Annual Facilities Costs in a previous Fiscal Year;
(iii) Administrative Expenses for such Fiscal Year;
(iv) the amount needed to (1) cure any delinquencies in the payment of principal or interest on Bonds which have occurred in the prior Fiscal Year, and (2) to fund any foreseeable deficiency of the amount to be available for the payment of principal or interest on Bonds which are expected to occur in such Fiscal Year, in each case to the extent not already included in the calculation of Annual Facilities Costs in the current or any previous Fiscal Year;
(v) the amount needed to (1) cure any delinquencies in the payment of the Facilities Special Taxes in the prior Fiscal Year, (2) to fund any foreseeable deficiency of the amount to be available for the payment of Facilities Special Taxes which are expected to occur in such Fiscal Year, in each case, to the extent not already included in the calculation of Annual Facilities Costs in the current or any previous Fiscal Year; (vi) pay-as-you-go expenditures for authorized improvements; and (vii) during the Deferral Bonding Period, the amount needed to pay Development Impact Fee Deferrals not financed by Bonds.

The Annual Facilities Costs is the basis for the amount of Special Tax to be levied within Improvement Area No. 2. In no event may the City levy a Special Tax in any year above the Maximum Annual Facilities Special Tax identified for each parcel in the Special Tax Formula.

Parcels Subject to the Facilities Special Tax. The Special Tax Formula identifies 9 large-lot taxable parcels planned for residential uses within the boundary of Improvement Area No. 2, which large-lot parcels are planned to be subdivided over time. Each fiscal year, the City will prepare a list of the then-current parcels subject to the Special Tax using the records of the City and the County Assessor, and will tax such parcels in accordance with the Special Tax 15 Formula. Taxable parcels that are acquired by a public agency in the future will remain subject to the Facilities Special Tax unless a “trade” resulting in no loss of Facilities Special Tax revenue can be made, as described in the Special Tax Formula.

Limitation on Increases in Levy of Facilities Special Tax. If owners are delinquent in the payment of Facilities Special Taxes, the City may not increase Facilities Special Tax levies to make up for delinquencies for prior Fiscal Years above the Maximum Facilities Special Tax rates specified for each category of property within Improvement Area No. 2. In addition, Section 53321(d) of the 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. See “SPECIAL RISK FACTORS.”
Duration of the Facilities Special Tax; Transition Year. The Facilities Special Tax will be levied and collected (up to maximum allowable amount) until the earlier of (i) the Transition Year or (ii) Fiscal Year 2086-87. For purposes of Improvement Area No. 2, “Transition Year” means the first Fiscal Year following the Fiscal Year in which the Transition Event occurred, and “Transition Event” means the earlier of (i) after the Initial Bonding Period, the Fiscal Year in which the Administrator determines the Development Impact Fee Deferral has been repaid in full to the City and the City determines funding is no longer needed for Annual Facilities Costs, or (ii) Fiscal Year 2086-87. “Initial Bonding Period” means the period in which Bonds are outstanding or refunded which financed Authorized Facilities (as defined in the Special Tax Formula) costs or refunded prior Bonds, other than the Development Impact Fee Deferral.

Prepayment of the Facilities Special Tax. The Special Tax Formula provides that landowners may prepay some of the Facilities Special Tax by a cash settlement with the City.

The amount of the prepayment required is to be calculated according to a formula set forth in the Special Tax Formula, which is generally based on the net present value of the remaining years in which the Facilities Special Tax will be collected, including the effect of a 2% per year escalation factor applicable for the time Bonds remain outstanding using a discount rate equal to the most current yield for the 30-year Treasury Constant Maturity as the discount factor, plus an amount representing the Development Impact Fee Deferral Amount (which amount is not available for prepayment of the Bonds), all as described in Section 8 of the Special Tax Formula set forth in APPENDIX A. Prepayment is only allowed if the City determines that the prepayment does not jeopardize its ability to make timely payments of debt service on outstanding Bonds, and the City maintains at least 110% debt service coverage on the outstanding Bonds.

Reduction of the Maximum Annual Facilities Special Tax Prior to First Bond Sale.

The Special Tax Formula includes a provision that, at the request of the developer/builders, the Maximum Annual Special Taxes set forth in the Special Tax Formula could be reduced once prior to the first sale of special tax bonds for Improvement Area No. 2. This provision was not utilized, and is no longer applicable, given the issuance and sale of the 2023 Bonds.

Levy of Annual Special Tax; Maximum Special Tax
General. The annual Special Tax will be calculated by the City and levied to provide money for debt service on the Bonds, replenishment of Reserve Accounts established within the Reserve Fund for each Series of Bonds, certain delinquencies, administration of the District 16 (including Improvement Area No. 2), and for payment of pay-as-you-go expenditures (to the extent permitted by the City) of the authorized public capital facilities not funded from Bond proceeds. In no event may the City levy a Special Tax in any year above the maximum identified for each taxable parcel in the Special Tax Formula. Land in Improvement Area No. 2 also includes 168 HDR units designated as affordable units as part of “phase 3” of the project, which are not subject to the Special Tax and provide no security for repayment of the Bonds.

Annual Special Tax Levy. The Special Tax will be levied each year by calculating the amount needed to be generated by all Taxable Parcels in Improvement Area No. 2; the Special Tax (up to the maximum allowable amount) will be levied against each Taxable Parcel until the Special Tax revenue equals such amount; however, the Special Tax Formula establishes a priority for which properties will be levied a Special Tax. First, all “Developed Parcels” in Improvement Area No. 2 receive a levy. If additional amounts are needed, a levy is made against each “Small Lot Tentative Map Parcel” in Improvement Area No. 2, then each “Large Lot Parcel” in Improvement Area No. 2, then each “Undeveloped Parcel” in Improvement Area No. 2. For single-family detached property, Developed Parcels are parcels shown on a Final Small Lot Subdivision Map recorded prior to May 1 of the preceding Fiscal Year. See “APPENDIX A – RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX.”
For Fiscal Year 2023-24, the Assigned Maximum Annual Facilities Special Tax per Unit was $3,173 for LDR units and $2,497 for MDR units, respectively.

The City covenants in the Fiscal Agent Agreement to fix and levy the amount of Special Taxes within Improvement Area No. 2 required for the payment of principal of and interest on any outstanding Bonds of Improvement Area No. 2 becoming due and payable during the ensuing year, including any necessary replenishment or expenditure of the Reserve Fund for the Bonds and an amount estimated to be sufficient to pay the Administrative Expenses during such year, all in accordance with the Special Tax Formula. The Special Tax is authorized to be levied in an amount not to exceed the Maximum Special Tax levy as described in the Special Tax Formula notwithstanding that a lower amount is sufficient to pay debt service on the Bonds. The Special Tax Formula provides a mechanism whereby the City may utilize the pay-as-you-go component to pay for and/or reimburse developers for a portion of the cost of Improvements not funded by proceeds of the bonds issued for Improvement Area No. 2. Proceeds of the annual Special Tax levy will first be used to pay the “Annual Facilities Costs” (which include debt service payments on the Bonds) other than pay-as-you-go expenditures, and the City contemplates that the levy will include a pay-as-you-go component in an amount equal to the Maximum Annual Facilities Special Tax on Developed Parcels, for deposit into the Improvement Fund for authorized costs not funded from Bond proceeds. See and “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Special Tax Methodology” above. See “APPENDIX A – RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX” for a copy of the Special Tax Formula.

Annual Escalation of Facilities Special Tax. The Facilities Special Tax escalates by 2% per fiscal year until the Transition Event, and thereafter will no longer be levied. See “APPENDIX A – RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX” and for a table showing the expected land uses and assigned Maximum Special Taxes, see “Attachment 2” in such Appendix.

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 17 of the City and the Owners of the Bonds. Within the Special Tax Fund, the City has established and will maintain the Surplus Account, to the credit of which the City will deposit surplus Special Tax Revenue, if any, 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 Special Tax Fund upon receipt. Prior to each Interest Payment Date, the City will withdraw from the Special Tax Fund and transfer (i) to the Fiscal Agent for deposit in the reserve accounts of the Reserve Fund, an amount which when added to the amount then on deposit therein is equal to the Reserve Requirement with respect to each series of Bonds, 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, premium, if any, and interest due on the Bonds on the next Interest Payment Date; provided, however, that as soon as practicable after the receipt by the City of any prepayments of Special Taxes, but no later than 10 Business Days after such receipt, the City shall transfer such prepayments to the Fiscal Agent for deposit into the Prepayment Account of the Bond Fund to be used for the redemption of Bonds. At such time as deposits to the Special Tax Fund equal the principal, premium if any, and interest becoming due on the Bonds for the current Bond Year and the amount needed to restore the reserve accounts of the Reserve Fund balance to the Reserve Requirement with respect to each series of Bonds, the amount in the Special Tax Fund 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 2nd of each year. From time to time, the City may withdraw from the Surplus Account of the Special Tax Fund amounts needed to pay the City’s administrative expenses and County fees; provided that such transfers will not be in excess of the portion of the Special Tax Revenues collected by the City that represent levies for administrative expenses. Moneys in the Surplus Account may also be transferred, at the City’s discretion, to the Improvement Fund to pay for costs of the Improvements (including reimbursements to developers for the cost of Improvements not funded from proceeds of Bonds issued for Improvement Area No. 2) or authorized facility contributions, to pay the principal of, premium, if any, and interest on the Bonds or to replenish amounts in the Reserve Fund.

Delinquent Payments of Special Tax; Covenant for Superior Court 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 or collected at a different time to meet the City’s financial obligations. In the event of a delinquency in the payment of any installment of Special Taxes, the City is authorized by the Act to order institution of an action in superior court to foreclose the lien therefor.

The City has covenanted in the Fiscal Agent Agreement with and 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 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 by more than 5% of the total amount of the Special Tax levied in Improvement Area No. 2 in such Fiscal Year, it will within 30 days thereafter institute foreclosure proceedings as authorized by the Act in order to enforce the lien of the delinquent installment of the Special Tax against each separate lot or parcel of land in Improvement Area No. 2 for which such installment of the Special Tax is delinquent, and will diligently prosecute and pursue such foreclosure proceedings to judgment and sale; provided, that if the City determines on the basis of such review that (a) the amount so collected is deficient by less than 5% of the total amount of the Special Tax levied in Improvement Area No. 2 in such Fiscal Year, but that 18 property owned by any single property owner in Improvement Area No. 2 is delinquent by more than $5,000 with respect to the Special Tax due and payable by such property owner in such Fiscal Year, or (b) property owned by any single property owner in Improvement Area No. 2 is delinquent cumulatively by more than $3,250 with respect to the current and past Special Tax due (irrespective of the total delinquencies in Improvement Area No. 2), then the City will institute, prosecute and pursue such foreclosure proceedings in the time and manner provided herein against each such property owner.

Under the 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 that 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 with respect to the Bonds are 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. Provided that it is not levying the Special Tax at the Maximum Annual Facilities 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. However, such adjustment is subject to the Maximum Annual Facilities Special Tax and to the limitation described under the caption “– Special Tax Methodology” above.

Under current law, a judgment debtor (property owner) has at least 120 days from the date of service of the notice of levy 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 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.”
No assurances can be given that the real property subject to a judicial foreclosure sale will be sold or, if sold, that the proceeds of sale will be sufficient to pay any delinquent Special Tax installment. The Act does not require the City to purchase or otherwise acquire any lot or parcel of property foreclosed upon if there is no other purchaser at such sale.

Section 53356.6 of the Act requires that property sold pursuant to foreclosure under the Act be sold for not less than the amount of judgment in the foreclosure action, plus post-judgment interest and authorized costs, unless the consent of the owners of at least 75% of the outstanding 19 Bonds is obtained. However, under Section 53356.6 of the Act, the City, as judgment creditor, is entitled to purchase any property sold at foreclosure using a “credit bid,” where the City could submit a bid crediting all or part of the amount required to satisfy the judgment for the delinquent amount of the Special Tax. If the City becomes the purchaser under a credit bid, the City must pay the amount of its credit bid into the redemption fund established for the Bonds, but this payment may be made up to 24 months after the date of the foreclosure sale. 2023 Reserve Account of Reserve Fund
A debt service reserve fund has been established under the Fiscal Agent Agreement (the “Reserve Fund”), and within the Reserve Fund, separate reserve accounts are being established for each series of Bonds. Accordingly, at the time of issuance of the 2023 Bonds, a reserve account will be established within the Reserve Fund for the benefit of the holders of the 2023 Bonds (the “2023 Reserve Account”). The 2023 Reserve Account is available solely for the payment of debt service on the 2023 Bonds and no other parity obligations.

Upon delivery of the 2023 Bonds, the Fiscal Agent will deposit an amount of the proceeds into the 2023 Reserve Account of the Reserve Fund so that the amount therein equals the “Reserve Requirement,” which means, with respect to any series of Bonds, the least of (i) 125% of the average Annual Debt Service with respect to the applicable series of Bonds; (ii) Maximum Annual Debt Service with respect to the applicable series of Bonds; and (iii) 10% of the original principal amount of the applicable series of Bonds (or, if the applicable series of Bonds has more than a de minimis amount of original issue discount or premium, 10% of the issue price of such series of Bonds); provided, that—
(a) the Reserve Requirement for the 2023 Bonds shall not increase after the date of issuance of the 2023 Bonds;
(b) in no event shall the City be obligated to deposit an amount in any reserve account 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; and
(c) the City may meet all or a portion of the Reserve Requirement with respect to any series of Bonds by depositing a Qualified Reserve Fund Credit Instrument.

As noted above, for each series of Additional Bonds, the Fiscal Agent shall establish a separate subaccount within the Reserve Fund for such series and moneys in each subaccount shall be held in trust by the Fiscal Agent for the benefit of the Owners of the respective series of Bonds.

Whenever, on the Business Day prior to any Interest Payment Date, the amount in any reserve account within the Reserve Fund exceeds the Reserve Requirement for the applicable series of Bonds covered by such reserve account, the Fiscal Agent shall provide written notice to the Chief Financial Officer of the amount of the excess. The Chief Financial Officer shall advise the Fiscal Agent in writing of the amount, if any, of any transfer required pursuant to the Fiscal Agent Agreement, and otherwise direct the Fiscal Agent to transfer an amount equal to the excess to the Improvement Fund, if the Project has not been completed as of the date of such transfer, or if the Project has been completed, to the Bond Fund to be used for the payment of the principal of and interest on the Outstanding Bonds covered by the applicable reserve account in accordance with the Fiscal Agent Agreement; provided, that to the extent that such excess results from the prepayment of Special Taxes and redemption of Bonds, such amount shall be transferred to the Prepayment Account and applied to the corresponding redemption of Bonds.

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 make 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 amount 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, there is established an Improvement Fund, which is to be held in trust by the Fiscal Agent and will be disbursed as provided in the Fiscal Agent Agreement for the payment or reimbursement of the costs of the construction and acquisition of the Improvements in accordance with the Acquisition Agreement (as described herein). Interest earnings from the investment of amounts in the Improvement Fund will be retained in the Improvement Fund to be used for the purposes of the Improvement Fund. 21 Upon completion of the Improvements and payment to the Master Developer or other entities that are due reimbursement for Improvements, the Fiscal Agent will transfer the amount, if any, remaining in the Improvement Fund to the Bond Fund for application to the payment of principal of and interest on the Bonds in accordance with the Fiscal Agent Agreement, and the Improvement Fund will be closed.

Future Parity Bonds
The proceedings conducted under the Act for the District and Improvement Area No. 2 authorize the issuance of up to $111,000,000 of special tax bonds for Improvement Area No. 2, of which the 2023 Bonds represent the first series. The City expects that it will, by a Supplemental Agreement, authorize the issuance of one or more additional series of Bonds (previously defined as the “Additional Bonds”) payable from Special Taxes and secured by the Special Tax Revenues on a parity with the 2023 Bonds, as development progresses in Improvement Area No. 2 and upon compliance by the City with the conditions set forth in the Fiscal Agent Agreement, which include the following:
(i) There shall be deposited into a reserve account of the Reserve Fund, an amount at least equal to the Reserve Requirement with respect to such Additional Bonds. (ii) After giving effect to the issuance of the Additional Bonds, for each Bond Year the Additional Bonds are Outstanding, projected Special Tax Revenues (which are net of 1% County collection charge), if levied at the maximum annual Special Tax rates per the Special Tax Formula, in each Fiscal Year are at least equal to 110% of Debt Service due in the Bond Year that begins in the corresponding Fiscal Year, as calculated by the special tax consultant to the City.
(iii) After giving effect to the issuance of the Additional Bonds, the aggregate value of all parcels in Improvement Area No. 2 subject to the Special Tax, including then existing improvements and any facilities to be constructed or acquired with the proceeds of the Additional Bonds, as determined by an MAI appraisal, assessed valuations shown on the then current County tax roll, or by a combination of both methods, is at least 3 times the sum of (1) the aggregate principal amount of all Bonds then Outstanding, plus (2) the aggregate principal amount of the Additional Bonds proposed to be issued, plus (3) the proportionate principal amount of any bonds then outstanding and payable from assessments which are a lien against property in Improvement Area No. 2, plus (4) a portion of the aggregate principal amount of all bonds issued under the Act, other than 2023 Bonds then Outstanding and the Additional Bonds, payable at least partially from special taxes to be levied on parcels of land subject to the Special Tax within Improvement Area No. 2 (the “Other Mello-Roos Bonds”) equal to the aggregate principal amount of the Other Mello-Roos Bonds multiplied by a fraction, the numerator of which is the amount of special taxes levied for the Other Mello-Roos Bonds on parcels of land within Improvement Area No. 2 subject to the Special Tax, and the denominator of which is the total amount of special taxes levied for the Other Mello-Roos Bonds on all parcels of land subject to the Special Tax against which the special taxes are levied to pay the Other Mello-Roos Bonds (such fraction to be determined based upon the special taxes which could be levied the year in which the Additional Bonds are issued, as determined by the City), based upon information from the most recent available Fiscal Year. 22 Additional Bonds may be issued to finance additional improvements and/or to refund outstanding 2023 Bonds. Additional Bonds may be issued for the purpose of refunding any outstanding 2023 Bonds without meeting the foregoing conditions so long as debt service on the refunding Bonds in each Bond Year is less than debt service on the 2023 Bonds refunded.

Nothing in the Fiscal Agent Agreement shall be interpreted to prohibit issuance of bonds or Additional Bonds secured on a subordinate basis to the 2023 Bonds.

In connection with the approval of development in Improvement Area No. 2, the City has agreed that payment of certain impact fees owed by the Master Developer and merchant builders in Improvement Area No. 2 will be deferred (referred to as the “Development Impact Fee Deferral” in the Special Tax Formula) to allow payment of the deferred fees after the 2023 Bonds and any Additional Bonds issued during the Initial Bonding Period have been fully paid. The City expects to receive payment for the deferred impact fees either through continued collection of Special Taxes or through the issuance of future bonds after the 2023 Bonds and any Additional Bonds issued during the Initial Bonding Period have matured. If the City chooses to issue bonds to pay deferred impact fees, the remaining authorization will be available to be utilized by the City as a means therefor.
23 DEBT SERVICE SCHEDULE
The annual debt service on the 2023 Bonds, assuming no early redemptions other than mandatory sinking fund payments, is set forth below.

City of Roseville
Creekview Community Facilities District No. 1 (Public Facilities) Improvement Area No. 2
2023 Bonds – Annual Debt Service
Year
Ending
(Sept. 1)
2023 Bonds
Principal
2023 Bonds
Interest
2023 Bonds
Total
2024
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
Total
____________
Source: Underwriter.
24 THE CREEKVIEW SPECIFIC PLAN
The Creekview Specific Plan (“Creekview Specific Plan”) is the primary land use, policy and regulatory document used to guide development of land in Improvement Area No. 2 and the surrounding area. The Creekview Specific Plan establishes a development framework for land use, affordable housing, resource protection, circulation, utilities and services, implementation and design for approximately 461 acres in the northwest portion of the City projected to develop into approximately 2,011 single and multi-family residential units, of which land in Improvement Area No. 2 consists of land planned for 561 taxable residential units as well as non-taxable residential and public/quasi-public uses. The plan area is bounded by Blue Oaks Boulevard to the south, the Fiddyment Ranch portion of the West Roseville Specific Plan to the east and the City’s Johnson Wildlife Area property to the west.

The intent of the Creekview Specific Plan is to promote the systematic and orderly development of the plan area. All subsequent development projects and related activities in the Creekview Specific Plan area are required to be consistent with the Creekview Specific Plan. The Creekview Specific Plan implements the goals and policies of the City of Roseville General Plan and augments these goals and policies by providing specific direction to reflect conditions unique to the project and plan area. The City’s General Plan serves as the long-term policy guide for the physical, economic and environmental growth of the City. The property within the District was included within the Creekview Specific Plan at adoption, and is a component of the Creekview Specific Plan. The full text of the Creekview Specific Plan is available on the City’s website.

Land Use Concept. The Creekview Specific Plan is planned primarily as a residential community, while also providing recreation, open space, employment and educational opportunities. The primary elements that comprise the form of the Creekview Specific Plan land use plan include a commercial area, residential neighborhoods and park/open space areas, as described below.

Blue Oaks/Westbrook Commercial – The intersection of Blue Oaks Boulevard and Westbrook Boulevard creates the plan area’s best opportunity for commercial uses, anticipated to consist of community commercial, business professional and related uses.

These uses are anticipated to support approximately 190,000 square feet of commercial/business uses, including a grocery store, drug store, retail services, personal services and professional offices.

Residential Neighborhoods – A variety of housing styles similar to that found elsewhere in the City are planned. The neighborhoods are generally divided by the geography of the site into four irregularly-sized quadrants. Each quadrant has its own adjacent land uses, natural resources and circulation requirements.

Parks and Open Space – Approximately 30% of the plan area is planned for park and open spaces use, which is equivalent to 28 acres of park and open space per 1,000 residents. Open space corridors provide for passive recreation opportunities, preservation of significant resources, viewsheds, potential floodwater conveyance and retention, resource mitigation, wildlife movement corridors, and can function to improve the interface between uses.

Maps. Maps showing the region and local area where Improvement Area No. 2 is located, as well as the boundaries of Improvement Area No. 2 follow. 25 [Map 1 – Regional Area Map]
26 [Map 2 – Local Area Map]
27 [Map 3 – Improvement Area No. 2 Boundary Map]
28 [Map 4 – Improvement Area No. 2 Aerial Fly-Over Map] 29 IMPROVEMENT AREA NO. 2 PLANNED DEVELOPMENT
The information regarding development of the property contained under this caption has been provided by representatives of the Master Developer and the Merchant Builders, and has not been independently confirmed or verified by the Underwriter or the City. Neither the Underwriter nor the City makes any representation as to the accuracy or adequacy of the information contained under this caption. There may be material adverse changes in this information after the date of this Official Statement. See “SPECIAL RISK FACTORS” herein.

The Creekview Development
General. The land within Improvement Area No. 2, planned for 561 taxable single-family homes, is part of a larger residential community referred to as the “Winding Creek” project being developed by the Master Developer in the Creekview Specific Plan (herein, the “Creekview Development” or “Property” or “Project”). The Creekview Development is located north of Blue Oaks Boulevard and west of the Fiddyment Farm development, in the northwest part of the City.

The Creekview Development encompasses property currently within Improvement Area No. 1 and Improvement Area No. 2. The Creekview Specific Plan establishes a development framework for land use, affordable housing, resource protection, circulation, utilities and services, implementation and design for approximately 461.40 acres in the northwest portion of the City projected to develop into approximately 2,011 single and multi-family residential units. The residential portion of the project is planned to include 987 Low Density Residential units on 182.81 acres, 477 Medium Density Residential units on 51.20 acres and 547 High Density Residential units on 17.68 acres. In addition to the residential uses, the project is planned to include open space and parks (153.17 acres), public uses/infrastructure (40.32 acres), commercial (9.22 acres) and an elementary school site (7.0 acres).

Information on land in Improvement Area No. 1 is provided for informational purposes; only the land in Improvement Area No. 2 is security for the Bonds.

Planned Development in Improvement Area No. 2. The property in Improvement Area No. 2 consists of approximately 167 acres, which is expected to be developed as a mix of Low Density Residential (“LDR”), Medium Density Residential (“MDR”), High Density Residential (“HDR”), and commercial, as shown in the following table. 30 Table 1
Property Ownership and Planned Development of Taxable Property in Improvement Area No. 2
(as of May 1, 2023)
Phase
Larger
Parcel
Designation Current Owner/Developer Type of Units
No. of
Taxable Units
3 C-5 Lennar Homes Low Density Residential 74
3 C-9 Woodside Low Density Residential 97
3 C-21 D.R. Horton/Hearthstone Landbank(1) Medium Density Residential 77 3 C-22 Meritage Medium Density Residential 82
330
4 C-6 Master Developer Low Density Residential 48
4 C-7 Master Developer Low Density Residential 74
4 C-8 Master Developer Low Density Residential 32
4 C-20 Master Developer Medium Density Residential 77
Sub-Total (Phase 4) 231
Total – Taxable Property in Improvement Area No. 2 561
(1) Village C-21 is being developed by D.R. Horton through its land bank Winding Creek C-21 – Roseville, L.P., an entity formed by Hearthstone. D.R.

Horton has an option, but not an obligation, to acquire lots from the land bank pursuant to a takedown schedule. See “MERCHANT BUILDER INFORMATION – D.R. Horton” herein.

Source: Master Developer.

Phasing of Planned Development. The phasing map on the following page shows each of the Villages planned for Improvement Area No. 2, as well as the Villages planned for the larger Creekview development project being undertaken by the Master Developer which are located outside of Improvement Area No. 2 and therefore do not provide security for the Bonds. See “– The Creekview Development” for additional details on the overall development project, of which the land in Improvement Area No. 2 forms a part, comprised of the area south of the creek. Phase 1 and phase 2 of the Winding Creek project are located in Improvement Area No. 1, phase 3 and phase 4 of the project are located in Improvement Area No. 2 and phase 5 of the project remains in the Future Annexation Ara. Only the land in Improvement Area No. 2 is security for the 2023 Bonds.

The Master Developer is constructing backbone and in-tract infrastructure necessary to bring all of the property into finished lot condition, at which time the lots would be sold to the Merchant Builders or other builders (for lots not currently under contract).

A map of the planned phasing of the Creekview Development follows on the next page. 31 32
Final Map Status. Final maps for the Phase 3 lots (330 lots) were recorded on August 30, 2022. Final maps for the Phase 4 lots (231 lots) are anticipated to be recorded in September 2024. As of May 1, 2023, the property had the following mapping status:

Table 2
Final Map Status of Taxable Property
in Improvement Area No. 2
(as of May 1, 2023)
Owner Villages
Date of Final Map
Recorded (Anticipated
Recordation)
Number
of Lots
Phase 3 (330 Lots):

Lennar Homes C-5 August 30, 2022 74
Woodside C-9 August 30, 2022 97
D.R. Horton/Hearthstone Landbank(1) C-21 August 30, 2022 77 Meritage C-22 August 30, 2022 82
Phase 3 Totals 330
Phase 4 (231 Lots):

Master Developer C-6 (September 2024) 48
Master Developer C-7 (September 2024) 74
Master Developer C-8 (September 2024) 32
Master Developer C-20 (September 2024) 77
Phase 4 Totals 231
IA No. 2 Total 561
____________
(1) Village C-21 is being developed by D.R. Horton through its land bank Winding Creek C-21 – Roseville, an entity formed by Hearthstone. D.R. Horton has an option, but not an obligation, to acquire lots from the land bank pursuant to a takedown schedule.

See “MERCHANT BUILDER INFORMATION – D.R. Horton” herein.

Source: Master Developer.

Phase 3 – All Lots Owned by Merchant Builders. Of the proposed 561 taxable lots in Improvement Area No. 2, 330 lots, comprising all of “Phase 3” of the project have been acquired by the following merchant builders (collectively, the “Merchant Builders”): Lennar Homes of California, LLC, a California limited liability company (“Lennar Homes”) (large lot C-5, planned for 74 homes); Meritage Homes of California, Inc., a California corporation (“Meritage”) (large lot C-22, planned for 82 homes); Woodside 05N LP, a California limited partnership (“Woodside”) (large lot C-9, planned for 97 homes); and Winding Creek C-21 – Roseville, a California limited partnership (“Hearthstone Landbank”), the land bank for D.R. Horton CA2, Inc., a California corporation (“D.R. Horton”) (large lot C-21, planned for 77 homes).

Future Sales of Multi-Family Site (Non-Taxable Property). Land in Improvement Area No. 2 also includes land designated for 168 high-density-residential (HDR) units that are not subject to the Special Tax and provide no security for repayment of the Bonds.

Future Sales of Phase 4 (Taxable Property). Land in Improvement Area No. 2 also includes land within “phase 4” of the project planned to develop into 231 LDR/MDR units. The Master Developer anticipates selling these lots to the Merchant Builders or other merchant builders as market conditions warrant.
33 Development Agreement
General. The City entered into a Development Agreement, dated October 3, 2012, and First Amendment to Development Agreement, dated November 6, 2019 (collectively, the “Development Agreement”) with certain entities and individuals to which the Master Developer has subsequently succeeded with respect to the land owned by the Master Developer in the District. The Development Agreement’s purpose is to vest development rights, set forth infrastructure improvements and dedication requirements, secure the timing and methods for financing improvements, and specify other performance obligations as related to development in the Creekview Specific Plan area. All of the property in the District is subject to the requirements of the Development Agreement, as well as the Creekview Specific Plan. The Development Agreement was entered into in accordance with Sections 65864 through 65869.5 of the California Government Code, as implemented through Article V, Chapter 19.84 of the City’s Zoning Ordinance No. 3014.

The Development Agreement is the primary implementation tool for the Creekview Specific Plan and creates a binding contract between the City and the parties thereto, and their assigned successors in interest, which sets forth the needed infrastructure improvements, park dedication requirements, timing and method for financing improvements and other specific performance obligations of the City and the Master Developer 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 Creekview Specific Plan entitlements. Included are provisions relating to infrastructure improvements, public dedication requirements, landscaping amenities and other obligations of the parties.

The Development Agreement expires on April 25, 2043, which is 30 years following the annexation of portions of the Creekview Specific Plan into the City. The Development Agreement runs with the property, and may be modified only by mutual consent of the parties, and in a manner consistent with the Creekview Specific Plan. 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.

Land use and development entitlements granted under the Development Agreement for property in the District are consistent with the Creekview Specific Plan.

Improvements. The Development Agreement sets forth the responsibility of the Master Developer and its successors for a portion of the costs of certain public improvements required for its development within the Creekview Specific Plan. See “– Backbone Infrastructure and Other Development Conditions” herein for additional details.

Affordable Units. There are affordable housing requirements applicable to property in the District. The original Development Agreement had an affordable housing requirement on Village C-25 (10 middle income units, which are taxable), Village C-41 (40 low income units and 40 very low income units, which are not taxable), and Village C-42 (40 low income units and 41 very low income units, which are not taxable). The Developer and the City recognized that the Development Agreement erroneously stated that the low income and very low income units are located in Village C-42 and Village C-43 (not C-41); originally, the parties anticipated amending the Development Agreement to substitute Village C-41 for Village C-43 in the affordable housing requirements, which is consistent with the development and financing plans set forth in this Official 34 Statement. Instead, the parties reallocated the affordable units pursuant to a specific plan amendment. See “–Specific Plan and Development Agreement Amendments” below.

These affordable housing units are regulated by the City’s affordable housing requirements and are not subject to the special tax. Satisfaction of the affordable housing requirements applicable to Village C-43 is not a pre-condition for the Master Developer or any subsequent owner to obtain a final map or building permit with respect to any of the lots within Improvement Area No. 2 and, accordingly, the Master Developer does not believe the affordable housing requirements will impact the timing of development or sale of any those lots.

Specific Plan and Development Agreement Amendments. At the end of January 2021, the Master Developer submitted a series of documents to the City for consideration, including a proposed amendment to the Creekview Specific Plan and a proposed second amendment to the Development Agreement. The specific plan amendment was approved by the Planning Commission on July 22, 2021 and approved by the City Council on August 18, 2021. The second reading of the specific plan amendment was approved by the City Council on September 1, 2021.

Following statutory appeal periods, it become effective on October 1, 2021. On October 8, 2021, the Second Amendment of Development Agreement was recorded with the Placer County Recorder’s Office. The specific plan amendment and the Second Amendment of the Development Agreement, among other things, did all of the following:
 Under the prior Creekview Specific Plan, the location of the 201 affordable housing units in the Project were planned to be constructed (i) on the following parcels located in the Future Annexation Area: Parcel C-20 (10 single family units) and Parcel C-22 (20 single family units); and (ii) on the following parcels located in Improvement Area No. 2: Parcel C-25 (10 single family units), Parcel C-42 (80 rental units), and C-43 (81 rental units).
 The approved amended Creekview Specific Plan, and the Second Amendment of Development Agreement located the 201 affordable housing units in the Project as follows: (i) 85 rental units on Parcel C-40 located in the Future Annexation Area; and (ii) 116 rental units on Parcel C-43 in Improvement Area No. 2. The 116 rental units on Parcel C-43 are exempt from the Special Taxes. The previous affordable units in Improvement Area No. 2 that were no longer affordable will now be subject to the special tax rates for market rate units.

Backbone Infrastructure and Other Development Conditions. The Development Agreement requires satisfaction of various items as conditions of development of the Creekview Development. Set forth below is a table describing some of those conditions required for the Creekview Development that impact the property in Improvement Area No. 2 and the status of those conditions:
35 Table 4
Conditions of Development for Improvement Area No. 2
As of May, 2023
Item Condition Status
(as of May 1, 2023)
CC&R’s A declaration of Conditions, Covenants and Restrictions (CC&R’s), in a form approved by the City Attorney, shall be recorded on the entire property concurrently with the Final/Parcel Map.

CC&R’s have been prepared and were
approved by the City of Roseville concurrently
with the Phase 1 small lot final maps on
October 7, 2020. The CC&R’s were recorded
October 21, 2020.

Bonds Prior to the recordation of a small lot residential subdivision map for the Property, Master Developer
shall provide adequate assurances to City, either in
the form of subdivision improvement bonds, issuance
and sale of bonds by the CFD or other manner
acceptable to the City, that adequate funds are
available to finance the completion of all
improvements to Arterial Roadways, and Collector
Streets to serve the portion of the Property which is
the subject of the small lot residential subdivision
map; provided, however, Master Developer shall
not be required to post security fortheportion ofthe
workassociatedwithRoadCIPimprovements.

Phase 3 Backbone Roads: Subdivision
improvement bond is in place for Westbrook
Segment 3, expect it to be reduced to a
warranty bond in June 2023.

Phase 3 Villages: Subdivision Improvement
bonds are in place for all villages (5, 9, 21, &
22)
Phase 4 Backbone Roads: Subdivision
Improvement Bond is in place for Westbrook
Segment 4.

Formation of
Services CFD No. 2
and Annexation to
Municipal Services
CFD No. 3
Building permits may not be issued for the Property
until a project-specific services CFD (CFD No. 2) is
formed and the property annexes into the City’s
municipal services CFD (CFD No. 3). The CFDs will
finance landscaping and open space maintenance
for the project, and City-wide services.

Complete.

Bypass Channel The Pleasant Grove Creek Bypass Channel must be completed prior to development of Improvement
Area No. 2.

Complete.

Arterial Roadway,s,
Collector Streets,
and Rights of Way
Master Developer shall construct backbone and intract roads.Backbone road for Phase 3 (Westbrook Blvd Segment 3 from Pleasant Creek to Creekpark
Drive) is 100% complete, scheduled for
acceptance by the City of Roseville in June,
2023. Backbone road for Phase 2 (Westbrook
Blvd Segment 4 from Creekpark Drive to
Benchmark Drive) is 95% complete. Expect
100% completion by June, 2023.

In-tract roads for Phase 3 villages are 100%
complete. Grading for Phase 4 in-tract
improvements is 100% complete. Construction
of Phase 4 in-tract improvements is anticipated
to begin in Spring of 2024 and be 100%
complete by the end of 2024.

Sewer Facilities Master Developer shall construct on-site sewer facilities.

On-site sewer facilities serving Phase 3 & 4
backbone roads and Phase 3 villages are
complete. On-site sewer improvements
serving Phase 4 villages are anticipated to
begin in the Spring of 2024 and be complete by
the end of 2024.

Groundwater Well Parcel C-84 must be dedicated to be used as a ground water well.

Completed. Parcel C-84 was irrevocably
offered for dedication to the City on the Final
Map of Creekview Phase 1 Large Lot
Subdivision, recorded on June 1, 2020.
36 Item Condition Status
(as of May 1, 2023)
Water Facilities Master Developer shall construct on-site water system facilities.

On-site water facilities serving Phase 3 & 4
backbone roads and Phase 3 villages are
complete. On-site water improvements serving
Phase 4 villages are anticipated to begin in the
Spring of 2024 and be complete by the end of
2024.

Recycled Water
Facilities
Master Developer shall construct specified recycled
water system facilities.

Recycled Water Facilities serving Improvement
Area No. 2 have been constructed in Westpark
Drive and Westbrook Blvd. as required to serve
the Creekview Specific Plan.

Storm Drains Master Developer shall construct storm drain mains and laterals in accordance with the Master Drainage
Plan for each tributary shed and Phasing Plan and in
accordance with the City’s then current Improvement
standards.

Storm Drain facilities serving Phase 3 & 4
backbone roads and Phase 3 villages are
complete. Storm Drain facilities serving Phase
4 villages are anticipated to begin in the Spring
of 2024 and be complete by the end of 2024.

On-Site Electric
Facilities
Concurrently with the construction of the adjacent
roadways and as specified in the Development
Agreement, Master Developer agrees to construct, or
finance the construction of, on-site 12kv electric
distribution facilities as directed by the Electric Utility Director.

On-Site Electric facilities serving Phase 3 & 4
backbone roads and Phase 3 villages are
complete. On-Site Electric facilities serving
Phase 4 villages are anticipated to begin in the
Summer of 2024 and be complete by the end of
2024.

Off-Site Electric
Facilities
If the electric infrastructure is not installed to the
boundary of the Plan Area prior to the start of
construction of the first phase of the Specific Plan,
Master Developer agrees to construct, or finance
the construction of, off-site 12kv electric distribution facilities as directed by the Electric Utility Director.

Off-Site Utility construction to the boundary of
the plan area is complete.

Electric Substation
Site
The Master Developer shall, prior to the issuance of
the 923rd residential building permit or any
combination of building permits within the Creekview
Specific Plan, dedicate to City a 0.90 buildable acre
site (parcel C-81) (including grading, construction of
retaining walls, access roads, and power line corridor) net of easements, wetlands, riparian corridors and
required setbacks for use as an electrical substation.

The substation site will be ready for delivery in
June, 2023 concurrently with the completion of
Westbrook Segment 4 improvements.

Parks Dedicate 16.3 acres of park land and 136.9 acres of open space land, and pay park fees at building
permit.

In Improvement Area No. 2, Park parcels C-60
and C-61 were irrevocably offered for
dedication to the City on the Final Map of
Creekview Phase 3 Large Lot Subdivision,
recorded December 2, 2021. All land for open
space and backbone road improvements has
been irrevocably offered for dedication to the
City on the Final Map of Creekview Phase 3
Large Lot Subdivision. Additional land for
landscaping and road improvements have been
offered for dedication to the City on the Phase
3 Small Lot Final Maps recorded in August
2022. Additional land for landscaping and road
improvements will be offered for dedication to
the City when the Phase 4 Small Lot Final Maps
are anticipated to record in the Fall of 2024. All
park fees will be paid by the Merchant Builders
at such time as a building permit is requested.

School Fees Under a mitigation agreement with the Roseville City School District, the School District agreed to defer a
portion of the school fees payable at building permit
for the property in Improvement Area No. 2, with the
deferred amount payable as a lump sum when the
first building permits are pulled in the Future
Annexation Area.

The Merchant Builders will pay the reduced
school fees in connection with each request for
building permits in Improvement Area No. 2.

The deferred amounts will be payable by the
Master Developer prior to the request for the
first building permit in the Future Annexation
Area.
37 Environmental Matters
Flood Hazard Map Information. According to the Federal Emergency Management Agency’s flood insurance rate maps (Flood Area Panel Number 06061C-0920H, with an effective date of November 2, 2018), the property in Improvement Area No. 2 is located within Flood Zone X, described as areas of minimal flooding (outside of the 100- and 500-year floodplains).

Wetland Conditions. According to the City’s planning department, some jurisdictional wetlands will be affected by the development of the Project; however the impact has been mitigated by the Master Developer. No additional environmental permits are required to be obtained.

Seismic Conditions. None of the property expected to be developed as part of the Project (including land in Improvement Area No. 2) is 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 Zone. None of the property in Improvement Area No. 2 is within a very high fire hazard severity zone, as defined by CAL-FIRE.

Utilities. It is expected that utility service for the property in Improvement Area No. 2 will be provided by the following entities:

Utility Provider
Water/Sewer City of Roseville
Electricity City of Roseville
Natural Gas Pacific Gas & Electric
Data/Phone Comcast/AT&T

THE MASTER DEVELOPER
The information regarding the ownership of the property contained under this caption has been provided by the Master Developer, and has not been independently confirmed or verified by the Underwriter or the City. Neither the Underwriter nor the City makes any representation as to the accuracy or adequacy of the information contained under this caption. There may be material adverse changes in this information after the date of this Official Statement. Neither the Bonds nor the Special Taxes securing the Bonds are personal obligations of the Master Developer, any affiliate of the Master Developer, or any other subsequent property owners within Improvement Area No. 2 (including the Merchant Builders), and, in the event that any property owner defaults in the payment of its Special Taxes, the District may proceed with judicial foreclosure of the delinquent land within Improvement Area No. 2 securing the Bonds, but has no direct recourse to any other assets of any property owner or any affiliate thereof. See “SPECIAL RISK FACTORS” herein.

General
Ownership Structure of Master Developer. The Master Developer is a Washington limited partnership with its primary development executive team having both regional and national development experience in residential, commercial, and municipal projects. Its general partner is Anthem United Creekview Management LLC, a Washington limited liability company 38 (“Anthem United”), and its limited partners are: (1) Anthem United Homes, Inc. (“Anthem United Homes”), (2) Granite Bay Development LP, and (3) Sherwood Developments, LLC.

General Partner. Anthem United, together with its affiliates, including Anthem United Homes, is a land development and homebuilding company operating across western North America (Canada and the United States). Anthem United is currently involved with building approximately 14,600 homes in more than 60 communities across more than 5,000 acres of land. Headquartered in Vancouver BC, it also has offices in Calgary and Edmonton AB, and Roseville, California. Anthem United, as the general partner of the Master Developer, has full managerial control of the Master Developer.

Limited Partners. Anthem United Homes is a privately held affiliate of Anthem United responsible primarily for home-building operations undertaken by Anthem United entities. Its President is Eric Carlson. Granite Bay Development LP is privately held affiliate of Anthem United. Eric Carlson is also its President. Sherwood Developments, LLC is privately held, and owned by Cameron Taylor. Its President is Cameron Taylor.

Relevant Experience of Master Developer and Affiliates. Examples of some of the Master Developer’s (or its affiliate’s) other projects include the following:
 Natomas Meadows (Sacramento, CA) – 630 single family detached finished lots, all of which were sold to D.R. Horton, Lennar Homes, Carson, and Woodside.
 Promenade (West Sacramento, CA) – 222 single family detached finished lots, all of which were sold to Anthem United Homes.
 Fiddyment Ranch (Roseville, CA) - 419 single family detached finished lots, all of which were sold to JMC Homes and Taylor Morrison.

Master Developer Financing Plan
Estimated Cost of the Improvements. The Master Developer has expended over $113 million dollars on improvements for the Creekview Development and intends to finish constructing site improvements and certain backbone infrastructure improvements in both Improvement Area No. 1 and Improvement Area No. 2 and in the remaining future annexation area (collectively, the “Improvements”). The following table details the status of the Improvements to be constructed and the estimated costs associated with such Improvements. 39 Table 5
Master Developer’s Estimated Costs of Improvements
As of May 1, 2023
Area Improvement Estimated
Total Cost
Costs Spent
as of 5/1/23
% of
Completion
Remaining
Costs
Improvement
Area No. 1
Backbone Infrastructure $36,020,840 $35,787,714 99.4% $233,126 In-Tract Improvements $28,299,014 $28,299,014 100.0% $0 Subtotal – Improv. Area
No. 1 $64,319,854 $64,086,728 99.6% $233,126
Improvement
Area No. 2 –
Phase 3
Backbone Infrastructure $13,313,374 $13,267,523 99.7% $45,851 In-Tract Improvements $25,765,899 $25,765,899 100.0% $0 Subtotal Phase 3 $39,079,273 $39,033,422 99.9% $45,851
Improvement
Area No. 2 –
Phase 4
Backbone Infrastructure $9,926,500 $9,653,937 97.3% $272,563 In-Tract Improvements $12,609,366 $559,341 4.4% $12,050,025 Subtotal Phase 4 $22,535,866 $10,213,278 45.3% $12,322,588 Future
Annexation
Area –
Phase 5
Backbone Infrastructure $4,645,398 $188,168 4.1% $4,457,230 In-Tract Improvements $16,771,058 $36,315 0.2% $16,734,743 Subtotal – FAA $21,416,456 $224,483 1.0% $21,191,973
TOTAL – Creekview Development $147,351,449 $113,557,911 77.1% $33,793,538 Funding Sources. The Master Developer intends to use the following sources of funds to finance the Improvements for the Creekview Development:
 Equity from the partner-entities comprising the Master Developer (see “–The Master Developer,” above, for more information about these entities).  Draws on a future revolving construction loan (see “– Revolving Construction Loan” below).
 Sales of lots in Improvement Area No. 1 and Improvement Area No. 2 to merchant builders and other developers (see “–Pending Sales of Phase 2 Lots to Merchant Builders” herein).
 Proceeds of the Bonds (secured by Improvement Area No. 2) and bonds issued for land within Improvement Area No. 1.
 Pay-as-you-go Special Taxes available to the Master Developer under the Acquisition Agreement (see “– Acquisition Agreement” below).

Revolving Construction Loan. The Master Developer is actively seeking a new facility to assist in financing Phases 4 and 5, but nothing has been finalized. The $107,900,000 revolving credit line the Master Developer had in place for Phases 1-3 was paid in full. 40 Acquisition Agreement. In connection with the formation of the District, the City and the Master Developer entered into a Funding, Construction and Acquisition Agreement (the “Acquisition Agreement”) which provides that the Master Developer will construct (or cause to be constructed or funded) the Improvements, and the City, upon completion of construction and acceptance (or through progress payments prior to completion of the entire Improvement), will purchase the Improvements or reimburse the Master Developer for expended amounts from the proceeds of the Bonds and/or Special Taxes on a pay-as-you-go basis. The Master Developer will be responsible for the portion of the cost of construction of the Improvements not paid with Bond proceeds.

The Rate and Method 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 Improvements 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 City contemplates utilizing this funding mechanism during the time the Bonds are outstanding. Additionally, after the final maturity date of the Bonds and any additional bonds issued to reimburse developers for costs of the Improvements, the City expects to continue to levy Special Taxes for payment of the “Development Impact Fee Deferral” (as defined in the Rate and Method) which levy may secure future bonds issued after payment in full of the Bonds and any Additional Bonds issued under the Fiscal Agent Agreement. 41 Cash Flow Statement
The following table shows estimated cash flow sources and uses for the Master Developer related to the development of the land within Improvement Area No. 2 only.

Table 6
Master Developer’s Proposed Financing Plan – Improvement Area No. 2 Phase 3 Only(1)
As of May 1, 2023
As of May 1, 2023
Remainder
2023
Total
Through 2023
Developer’s Sources of Funds
Owner Equity $12,174,900 $0 $12,174,900
Revolving LOC(2) 44,526,122 0 44,526,122
Village Lot Sales/Acreage Sales 44,802,500 0 44,802,500 CFD Proceeds 0 12,000,000 12,000,000
Recoveries(3) 1,916,046 0 1,916,046
Total Sources $103,419,568 $12,000,000 $115,419,568
Developer’s Uses of Funds
Land Acquisition and Env’l $10,568,528 $0 $10,568,528
Backbone Infrastructure 13,267,523 45,851 13,313,374
In-Tract Improvements 25,765,899 0 25,765,899
Sales & Marketing 929,509 0 929,509
Planning & Consultants 3,254,302 0 3,254,302
Loan Repayment (principal) 44,526,122 0 44,526,122
Loan Repayment (interest) 1,885,384 0 1,885,384
Total Uses $100,197,267 $45,851 $100,243,118
Annual Cash Flow (Sources – Uses) $3,222,301 $11,954,149 $15,176,450 Cumulative Cash Flow $3,222,301 $15,176,450 $15,176,450 ____________
(1) These sources and uses are for Phase 3 only. The development of Phase 4 lots will begin in the Spring of 2024. (2) Only the amount of the revolving loan applied to Improvement Area No. 2 is shown in Table 6. (3) Recoveries consist of reimbursements by the City of Roseville for any improvements completed by the Master Developer on behalf of other parties. The flow of funds is managed by the City of Roseville and the Master Developer submits reimbursement requests once the work is complete.

Notwithstanding the belief of the Master Developer that it will have sufficient funds to complete its planned development, no assurance can be given that sources of financing available to the Master Developer will be sufficient to complete such development as currently anticipated.

While the Master Developer has made internal financing available in the past for similar activities, there can be no assurance whatsoever of its willingness or ability to do so in the future. Neither the Master Developer nor any of its affiliates has any legal obligation of any kind to make any such funds available or to obtain loans or lines of credit. If and to the extent that internal financing, loan proceeds, lines of credit, or bond proceeds are inadequate to pay the costs to complete the Master Developer’s planned development, there could be a shortfall in the funds required to complete such proposed development and portions of such development might not be completed. 42 MERCHANT BUILDER INFORMATION
The information regarding the ownership of the property contained under this caption has been provided by the respective Merchant Builders, and has not been independently confirmed or verified by the Underwriter or the City. Neither the Underwriter nor the City makes any representation as to the accuracy or adequacy of the information contained under this caption.

There may be material adverse changes in this information after the date of this Official Statement.

Neither the Bonds nor the Special Taxes securing the Bonds are personal obligations of the Merchant Builders, or any other subsequent property owners within Improvement Area No. 2, and, in the event that any property owner defaults in the payment of its Special Taxes, the District may proceed with judicial foreclosure of the delinquent land within Improvement Area No. 2 securing the Bonds, but has no direct recourse to any other assets of any property owner or any affiliate thereof. As a result, other than as provided in this Official Statement, no financial statements or information is, or will be provided about the Merchant Builders or any other current or subsequent property owner. See “SPECIAL RISK FACTORS” herein.

Lennar Homes
Ownership. 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 known as Lennar Homes of California, LLC, a California limited liability company (“Lennar Homes”). All references herein to Lennar Homes prior to February 1, 2022 shall mean Lennar Homes of California, Inc. a California corporation, and all references herein to Lennar Homes on and after February 1, 2022 shall mean Lennar Homes of California, LLC, a California limited liability company.

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. 43 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.

Development Plan. Lennar Homes plans to construct a total of 74 single-family detached homes in Improvement Area No. 2 in a single neighborhood using its “St. Moritz” product line.

This product type is already being used in Lennar Homes’ “The Ranch” development project, located nearby in the City, and its project in the Winding Creek development represents a continuation of that homebuilding activity.

Lennar Homes anticipates that the plan sizes of the homes will range from 2,119 to 3,033 square feet, with base pricing ranging from $592,000 to $712,000. Base sales prices are as of May 1, 2023. Base sales prices exclude lot premiums, options and extras and any incentives or price reductions. Base sales prices are subject to change.

Status of Development. Lennar Homes anticipates commencing model homes in October, 2023 and production homes in December 2023. First sales to homeowners are anticipated to start by December 2023.

Financing Plan. Lennar homes purchased finished lots from the Master Developer.

Lennar Homes intends to finance the development of its neighborhood within Village C-5 using internal sources (which may include funding from its parent company and home sales proceeds).

No assurance can be given that amounts necessary to fund the planned development by Lennar Homes in Improvement Area No. 2 will be available when needed. Neither Lennar Homes nor any other entity or person is under any legal obligation of any kind to expend funds for the development of the property as planned by Lennar Homes in Improvement Area No. 2. Any contributions by Lennar Homes or any other entity or person to fund the costs of such development are entirely voluntary. Lennar Homes has no legal obligation to Bond holders to make any such funds available for construction or development, or the payment of ad valorem property taxes or the Special Taxes. Many factors beyond Lennar Homes’ control, or a decision by Lennar Homes to alter its current plans, may cause the actual sources and uses to differ from the projections.

If and to the extent that internal funding, including but not limited to home sales revenues and corporate financing from Lennar Homes’ parent company, is inadequate to pay the costs to complete the planned development by Lennar Homes within Improvement Area No. 2 and other financing by Lennar Homes is not put into place, there could be a shortfall in the funds required to complete the proposed development by Lennar Homes in Improvement Area No. 2 and the remaining portions of Lennar Homes’ project in Improvement Area No. 2 may not be developed.

See “SPECIAL RISK FACTORS – Property Values and Property Development” herein. 44 COVID-19 Impact. The development of Lennar Homes’ planned development within Improvement Area No. 2 may be subject to delays caused by the COVID-19 pandemic and related public health and governmental authorities’ orders and actions. As the impacts caused by the outbreak evolve, there could be an adverse impact on the timing and costs of the planned development within Improvement Area No. 2. See “SPECIAL RISK FACTORS – COVID-19 Pandemic” herein.

Lennar Homes cannot predict the ultimate effects of the COVID-19 outbreak and related public health and governmental authorities’ orders and actions (including, without limitation, the scope of restrictions under any shelter in place orders) or whether any such effects would have a material adverse effect on its ability to develop and/or sell homes in Improvement Area No. 2.

Woodside
Ownership. As defined previously in this Official Statement, “Woodside” refers to Woodside 05N, LP, a California limited partnership. Woodside is wholly owned by Woodside Group, LLC, a Nevada limited liability company (“Woodside Group”), directly or through its wholly owned subsidiaries. Woodside is owned 99% directly by Woodside Group, as a limited partner.

The remaining 1% interest is owned by WDS GP, Inc., a California corporation, as its general partner, which is wholly owned by Woodside Homes of California, Inc., a California corporation, which in turn is wholly owned by Woodside Group. The parent of Woodside Group is Woodside Homes Company, LLC, a Delaware limited liability company (“Woodside Homes Company”).

Since February 28, 2017, the ultimate parent of Woodside Homes Company has been Sekisui House, Ltd, one of Japan’s largest homebuilders, which was founded in 1960 and is headquartered in Osaka, Japan.

Woodside Group’s subsidiaries engage in the design, construction, and sale of singlefamily homes under the brand name of “Woodside Homes.” Woodside is one of America’s top 30 homebuilders having built more than 40,000 homes across the United States, with current operations in Arizona, California, Nevada, and Utah.

The foregoing internet addresses and references to filings with the SEC are included for reference only, and the information on such internet sites and on file with the SEC are not a part of this Official Statement and are not incorporated by reference into this Official Statement. No representation is made in this Official Statement as to the accuracy or adequacy of the information contained on such sites, and such sites have not been reviewed by the Authority or the Underwriter. Neither Woodside nor any related entity is 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 internet sites in evaluating whether to buy, hold or sell the Bonds.

Development Plan. Woodside plans to construct a total of 97 single-family detached homes in Improvement Area No. 2 in a single neighborhood known as “Wildflower at Winding Creek.” The proposed product mix for the homes planned to be constructed by Woodside within this neighborhood is set forth in the following tables. 45 “Wildflower at Winding Creek” – Village C-9
(as of May 1, 2023)
Floor Plan
Square
Footage
Total
Number of
Planned
Units
Projected Base
Sales Price(1)
Plan 1 2,330 26 $665,990
Plan 2 2,915 25 715,990
Plan 3 3,041 20 725,990
Plan 4 3,217 26 750,000
Totals 97
______________________________
(1) Base sales prices are as of May 1, 2023. Base sales prices exclude lot premiums, options and extras and any incentives or price reductions. Base sales prices are subject to change.

Status of Development. Woodside anticipates commencing construction of the model homes and the first phase of production homes in June, 2023. First sales to homeowners are anticipated by August, 2023.

Woodside’s development expectations described above are based on Woodside’s current plans. These plans may change due to changes in economic and market conditions or other factors. No assurance can be given that home construction and sales will be carried out on the schedule and according to the plans described herein, or that the home construction and sale plans or base prices set forth above will not change after the date of this Official Statement.

Woodside reserves the right to change its development plans 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 by the homebuyer. See “SPECIAL RISK FACTORS — Property Values and Property Development – Risks of Real Estate Secured Investments Generally.” Financing Plan. Woodside intends to finance the development of its neighborhood within Village C-9 using internal sources, including cash generated from its homebuilding operations and advances from affiliates of its parent Woodside Homes Company. Woodside Homes Company has a $330 million unsecured term loan. Woodside Homes Company also has an unsecured revolving credit facility with borrowing capacity as of April 1, 2023 of $200 million, which is not subject to a borrowing base.

As of May 1, 2023, Woodside has expended approximately $_______ on its development within Improvement Area No. 2, including [land acquisition costs,] site development costs, permits and fees, direct and indirect home construction costs, and marketing and sales costs and expenses, and anticipated expending an additional approximately $____________ to complete the development, including, site development costs, permits and fees, direct and indirect home construction costs, and marketing and sales costs and expenses.

No assurance can be given that amounts necessary to fund the planned development by Woodside in Improvement Area No. 2 will be available when needed. Neither Woodside nor any other entity or person is under any legal obligation of any kind to expend funds for the development of the property as planned by Woodside in Improvement Area No. 2. Any contributions by Woodside or any other entity or person to fund the costs of such development are entirely voluntary. Woodside has no legal obligation to Bond holders to make any such funds available for construction or development, or the payment of ad valorem property taxes or the 46 Special Taxes. Many factors beyond Woodside’s control, or a decision by Woodside to alter its current plans, may cause the actual sources and uses to differ from the projections.

If and to the extent that internal funding, including but not limited to home sales revenues and corporate financing from affiliates of Woodside’s parent company, is inadequate to pay the costs to complete the planned development by Woodside within Improvement Area No. 2 and other financing by Woodside is not put into place, there could be a shortfall in the funds required to complete the proposed development by Woodside in Improvement Area No. 2 and the remaining portions of Woodside’s project in Improvement Area No. 2 may not be developed. See “SPECIAL RISK FACTORS – Property Values and Property Development” herein.

Meritage
Ownership. As previously defined in this Official Statement, “Meritage” is Meritage Homes of California, Inc., a California corporation. Meritage is a subsidiary of Meritage Homes Corporation (“Meritage Homes Corporation”), a Maryland corporation. Meritage Homes Corporation is a homebuilder focused primarily on high-growth regions of the western and southern United States. Meritage Homes Corporation operates as a holding company, has no independent assets or operations, and is traded on the New York Stock Exchange (“NYSE”) under the ticker symbol MTH. Homebuilding, construction, development and sales activities are conducted through subsidiaries. As of December 31, 2022, Meritage Homes Corporation was actively selling homes in 271 communities, with base prices ranging from approximately $250,000 to $1,400,00. The company’s average sales price on both home closings and orders was approximately $440,000 for the year ended December 31, 2022.

Meritage Homes Corporation is subject to the informational reporting requirements of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), and in accordance therewith files reports, proxy statements and other information, including financial statements, with the Securities and Exchange Commission (the “SEC”). Such filings set forth, among other things, certain data relative to the consolidated results of operations and financial position of Meritage Homes Corporation and its subsidiaries (e.g., see Meritage Homes Corporation’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, as filed with the SEC on February 15, 2023 and Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2023, as filed with the SEC on April 28, 2023) as of the dates described therein. The SEC maintains an Internet website that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC, including Meritage Homes Corporation. The address of such Internet website is www.sec.gov. All documents subsequently filed by Meritage Homes Corporation pursuant to the requirements of the Exchange Act after the date of this Official Statement will be available for inspection in such manner as the SEC prescribes. Copies of Meritage Homes Corporation’s annual report, quarterly reports and current reports, including any amendments, will be available from Meritage Homes Corporation’s website at www.meritagehomes.com.

The foregoing internet addresses and references to filings with the SEC are included for reference only, and the information on such internet sites and on file with the SEC are not a part of this Official Statement and are not incorporated by reference into this Official Statement. No representation is made in this Official Statement as to the accuracy or adequacy of the information contained on such sites, and such sites have not been reviewed by the Authority or the Underwriter. Neither Meritage nor Meritage Homes Corporation is obligated to advance funds for construction or development or to pay ad valorem property taxes or the Special Taxes, and 47 investors should not rely on the information and financial statements contained on such internet sites in evaluating whether to buy, hold or sell the Bonds.

Development Plan. Meritage plans to construct a total of 82 single-family detached homes in Improvement Area No. 2 in a single neighborhood known as “Traverse at Winding Creek.” The proposed product mix for the homes planned to be constructed by Meritage within this neighborhood is set forth in the following tables.
“Traverse at Winding Creek” – Village C-22
(as of May 1, 2023)
Floor Plan
Square
Footage
Total
Number of
Planned
Units
Projected Base
Sales Price(1)
Plan 1 1,651 10 $534,990
Plan 2 1,823 18 550,990
Plan 3 2,020 26 570,990
Plan 4 2,177 28 586,990
Totals 82
______________________________
(1) Base sales prices are as of May 1, 2023. Base sales prices exclude lot premiums, options and extras and any incentives or price reductions. Base sales prices are subject to change.

Status of Development. Meritage anticipates commencing construction of the model homes and first phase of production homes in June 2023. First sales to homeowners are anticipated by November 2023.

Meritage’s development expectations described above are based on Meritage’s current plans. These plans may change due to changes in economic and market conditions or other factors. No assurance can be given that home construction and sales will be carried out on the schedule and according to the plans described herein, or that the home construction and sale plans or base prices set forth above will not change after the date of this Official Statement.

Meritage reserves the right to change its development plans 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 by the homebuyer. See “SPECIAL RISK FACTORS — Property Values and Property Development – Risks of Real Estate Secured Investments Generally.” Financing Plan. Meritage intends to finance the development of its neighborhood within Village C-22 using internal sources (which may include funding from its parent company and home sales proceeds). As of May 1, 2023, Meritage has expended approximately $9.3 million on its development in Improvement Area No. 2, including land in acquisition costs, site development costs, permits and fees, direct and indirect home construction costs, and marketing and sales costs and expenses, and anticipated expending an additional approximately $26.3 million to complete the development, including site development costs, permits and fees, direct and indirect home construction costs, and marketing and sales costs and expenses.

No assurance can be given that amounts necessary to fund the planned development by Meritage in Improvement Area No. 2 will be available when needed. Neither Meritage nor any other entity or person is under any legal obligation of any kind to expend funds for the 48 development of the property as planned by Meritage in Improvement Area No. 2. Any contributions by Meritage or any other entity or person to fund the costs of such development are entirely voluntary. Meritage has no legal obligation to Bond holders to make any such funds available for construction or development, or the payment of ad valorem property taxes or the Special Taxes. Many factors beyond Meritage’s control, or a decision by Meritage to alter its current plans, may cause the actual sources and uses to differ from the projections.

If and to the extent that internal funding, including but not limited to home sales revenues and corporate financing from Meritage’s parent company, is inadequate to pay the costs to complete the planned development by Meritage within Improvement Area No. 2 and other financing by Meritage is not put into place, there could be a shortfall in the funds required to complete the proposed development by Meritage in Improvement Area No. 2 and the remaining portions of Meritage’s project in Improvement Area No. 2 may not be developed. See “SPECIAL RISK FACTORS – Property Values and Property Development” herein.

D.R. Horton
Ownership. As previously defined in this Official Statement “D.R. Horton” is D.R. Horton CA2, Inc., a California corporation. D.R. Horton is a wholly-owned subsidiary of D.R. Horton, Inc., a Delaware corporation (“D.R. Horton, Inc.”). D.R. Horton, Inc. is a public company whose common stock is traded on the NYSE under the symbol “DHI.” Founded in 1978 and headquartered in Arlington, Texas, D.R. Horton, Inc. constructs and sells homes through its operating divisions in 106 markets in 33 states under the names of D.R. Horton, America’s Builder, Emerald Homes, Express Homes and Freedom Homes.

D.R. Horton, Inc. is subject to the informational requirements of the Exchange Act, and in accordance therewith files reports, proxy statements and other information, including financial statements, with the SEC. Such filings, particularly, D.R. Horton, Inc.’s Annual Report on Form 10-K for the fiscal year ended September 30, 2022, as filed with the SEC on November 18, 2022, and D.R. Horton’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2023, as filed with the SEC on April 24, 2023, set forth certain data relative to the consolidated results of operations and financial position of D.R. Horton, Inc. and its subsidiaries, including D.R. Horton, as of such dates.

The SEC maintains an Internet web site that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC, including D.R. Horton, Inc. The address of such Internet web site is www.sec.gov. All documents subsequently filed by D.R. Horton, Inc. pursuant to the requirements of the Exchange Act after the date of this Official Statement will be available for inspection in such manner as the SEC prescribes.

Copies of D.R. Horton, Inc.’s Annual Report and each of its other quarterly and current reports, including any amendments, are available from D.R. Horton, Inc.’s website at www.drhorton.com.

The foregoing internet addresses and references to filings with the SEC are included for reference only, and the information on such internet sites and on file with the SEC are not a part of this Official Statement and are not incorporated by reference into this Official Statement. No representation is made in this Official Statement as to the accuracy or adequacy of the information contained on such sites, and such sites have not been reviewed by the Authority or the 49 Underwriter. Neither D.R. Horton nor D.R. Horton Inc. is 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 internet sites in evaluating whether to buy, hold or sell the Bonds.

Hearthstone Landbank. Hearthstone Landbank is ultimately controlled by Hearthstone, Inc., a California corporation (“Hearthstone”). Hearthstone is devoted exclusively to managing institutional capital for residential housing developments. Hearthstone’s investments include single-family subdivisions, condominium and townhouse developments, master planned communities, land development projects and mixed-use communities. Hearthstone was the first, and today is the largest, institutional investment manager in the country that is dedicated to the residential building industry. At the time Hearthstone was organized in 1992, homebuilders across the United States were suffering from a shortage of capital resulting from changes in federal laws affecting the banking industry and from a loss of investor confidence in real estate. Hearthstone was organized in response to this capital shortage and in recognition of the long-term investment opportunity that single-family homebuilding presents for institutional investors. Hearthstone manages funds for numerous public and private pension plans, university endowments, Fortune 100 companies, and large private trusts. Hearthstone invests these funds on behalf of its investors in homebuilding and residential lot development projects with public and private homebuilders in select target markets throughout the United States. Hearthstone has funded and managed over $16.5 billion in investments to construct over 140,000 homes and lots in 22 states since its inception. Hearthstone’s principal office is located in Calabasas, California.

Development Plan.

As of April 20, 2023, the Master Developer had closed the sale of 77 lots within Improvement Area No. 2 to Hearthstone Landbank. Concurrent with the sale of the 77 lots to Hearthstone Landbank, D.R. Horton entered into a separate option agreement with Hearthstone Landbank whereby D.R. Horton will have the option, but not the obligation, to purchase the 77 lots from Hearthstone Landbank pursuant to the following takedown schedule. There is no guaranty that D.R. Horton will acquire the 77 lots from Hearthstone Landbank as planned.

Takedown Schedule
Under D.R. Horton Option Agreement – For Hearthstone Landbank Lots Scheduled
Acquisition Date
Lots
Scheduled
to be Acquired
Cumulative
Number of
Lots to be
Acquired
8/9/23 18 18
12/5/23 17 35
3/5/24 16 51
6/6/24 18 69
9/5/24 8 77
Total: 77
Following acquisition of the 77 lots in Improvement Area No. 2 owned by Hearthstone Landbank, D.R. Horton plans to construct a total of 77 single-family detached homes thereon in a single neighborhood known as Village C-21, to be marketed as “Dragonfly at Winding Creek.” The proposed product mix for the homes planned to be constructed by D.R. Horton within this neighborhood is set forth in the following tables.
50 Dragonfly at Winding Creek” – Village C-21
(as of May 1, 2023)
Floor Plan
Square
Footage
Total
Number of
Planned
Units
Projected Base
Sales Price(1)
Plan 1 1,567 25 TBD
Plan 2 1,615 26 TBD
Plan 7 1,631 26 TBD
Totals 77
______________________________
(1) As of May 1, 2023, initial base sales prices were not yet available. Base sales prices exclude lot premiums, options and extras and any incentives or price reductions. Base sales prices are subject to change.

Status of Development. D.R. Horton anticipates commencing construction of the model homes and first phase of production homes in August, 2023. First sales to homeowners are anticipated by October, 2023.

D.R. Horton’s development expectations described above are based on D.R. Horton’s current plans. These plans may change due to changes in economic and market conditions or other factors. No assurance can be given that home construction and sales will be carried out on the schedule and according to the plans described herein, or that the home construction and sale plans or base prices set forth above will not change after the date of this Official Statement. D.R.

Horton reserves the right to change its development plans 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 by the homebuyer. See “SPECIAL RISK FACTORS — Property Values and Property Development – Risks of Real Estate Secured Investments Generally.” Financing Plan. D.R. Horton intends to finance the acquisition and development of its neighborhood within Village C-21 using internal sources (which may include funding from its parent company and home sales proceeds). As of May 1, 2023, D.R. Horton has expended approximately $246,394 on its development within Improvement Area No. 2, which primarily consisted of initial development costs. D.R. Horton anticipates expending an additional approximately $32,256,009 to complete the development, including land acquisition costs, site development costs, permits and fees, direct and indirect home construction costs, and marketing and sales costs and expenses.

No assurance can be given that amounts necessary to fund the planned development by D.R. Horton in Improvement Area No. 2 will be available when needed. Neither D.R. Horton nor any other entity or person is under any legal obligation of any kind to expend funds for the development of the property as planned by D.R. Horton in Improvement Area No. 2. Any contributions by D.R. Horton or any other entity or person to fund the costs of such development are entirely voluntary. D.R. Horton has no legal obligation to Bond holders to make any such funds available for construction or development, or the payment of ad valorem property taxes or the Special Taxes. Many factors beyond D.R. Horton’ control, or a decision by D.R. Horton to alter its current plans, may cause the actual sources and uses to differ from the projections. 51 If and to the extent that internal funding, including but not limited to home sales revenues and corporate financing from D.R. Horton’ parent company, is inadequate to pay the costs to complete the planned development by D.R. Horton within Improvement Area No. 2 and other financing by D.R. Horton is not put into place, there could be a shortfall in the funds required to complete the proposed development by D.R. Horton in Improvement Area No. 2 and the remaining portions of D.R. Horton’ project in Improvement Area No. 2 may not be developed. See “SPECIAL RISK FACTORS – Property Values and Property Development” herein.

Increasing Mortgage Interest Rates and Banking Uncertainty Most of the purchasers of the Merchant Builders’ homes finance their acquisitions with mortgage financing. As such, rising interest rates, decreased availability of mortgage financing or of certain mortgage programs, higher down payment requirements, or increased monthly mortgage costs could have a negative impact on the estimated absorption rates of the Merchant Builders’ planned for-sale homes in Improvement Area No. 2. Further, a combination of higher mortgage rates, delays in construction stemming from delays in the supply chain, homebuyers’ inability to sell their existing homes and adverse changes in local, regional or national economic conditions, among other factors, could contribute to an increase in the Merchant Builders’ rate of home order cancellations. An increase in the level of such cancellations could similarly have a negative impact on the estimated absorption rates of the Merchant Builders’ planned for-sale homes in Improvement Area No. 2.

Impact of Economic Conditions on the Development in Improvement Area No. 2 Certain events and factors which negatively affect the regional, State and national economies could have an adverse effect on the pace at which Woodside is able to complete and sell homes and demand by and the ability of individuals to purchase homes within Improvement Area No. 2. Such events and factors could include rising inflation and interest rates, persistent supply chain issues, further impacts of the COVID-19 pandemic and global market instability caused by the war in Ukraine. Any adverse impact of the foregoing and other economic factors on the projects in Improvement Area No. 2 and the real estate market in general cannot be predicted.

Amid an unexpected run on deposits, the Federal Deposit Insurance Corporation (the “FDIC”) announced on March 10, 2023 that it had been appointed as receiver for Silicon Valley Bank (“SVB”), a large California bank and the 16th largest bank in the United States, and was liquidating SVB as a going concern. Additionally, on March 12, 2023, the FDIC announced that it had been appointed as receiver for Signature Bank, another large regional bank. However, the United States Treasury Department, the Federal Reserve and the FDIC issued a joint statement that all deposits at both institutions would be honored, regardless of dollar amount. Since such actions, there has been uncertainty and concern in the financial markets that there may be additional bank liquidity issues.
52 VALUE OF PROPERTY WITHIN IMPROVEMENT AREA NO. 2
The Appraisal
General. Integra Realty Resources, Sacramento, California (the “Appraiser”) prepared an appraisal report with a date of value of May 1, 2023 (the “Appraisal”). The Appraisal was prepared at the request of the City. 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 and qualifications which are set forth in the Appraisal.

Property Appraised. The appraised properties consist of all of the taxable property within Improvement Area No. 2, which consists of “phase 3” and “phase 4” of the larger Creekview Development. The final maps for Phase 3 (330 lots) recorded in August 2022 and lot construction was completed in March 2023. Phase 4 (231 lots) is currently under development; final maps are anticipated to be created and recorded by September 2024. All four villages in phase 3 of the project recently transferred to the Merchant Builders, as described elsewhere herein.

Value Estimates. The Appraisal provides a market value of the appraised property as of the date of value (based on the hypothetical condition the improvements to be financed by the 2023 Bonds were in place as of the date of valuation). The valuation accounts for the impact of the lien of the Special Tax and represents the hypothetical market value (based on the hypothetical condition) of all the land in Improvement Area No. 2. The property appraised excludes property in Improvement Area No. 2 designated for public and quasi-public purposes.

The aggregate value estimate for the appraised properties as of the date of value, using the methodologies described in the Appraisal and subject to the limiting conditions and special assumptions and the hypothetical condition set forth in the Appraisal, and based on the ownership of the property as of that date, is $56,272,000. For information on how the values were allocated among parcels and ownership, see APPENDIX B.

Hypothetical Condition. The value estimate is subject to a hypothetical condition, defined as that which is contrary to what exists but is supposed for the purposes of analysis.

For purposes of the hypothetical condition, the Appraiser assumed that certain proceeds of the 2023 Bonds are available to reimburse for certain infrastructure improvements already completed or impact fees paid.

Extraordinary Assumptions. The estimate of value set forth in the Appraisal is based on a number of extraordinary assumptions, including the following:
 According to the cost budget provided to the Appraiser, the Master Developer is obligated to complete significant infrastructure improvements benefitting both the subject property, as well as adjacent projects in Fiddyment Farms, Westpark and the Amoruso Specific Plan. Such development includes improvements to Blue Oaks Boulevard and Westbrook Boulevard. Completion of these improvements will generate City credits and/or reimbursements from future developers.  The intent of the Appraisal is to capture the increment of benefit associated with completion of the area wide improvements by the Master Developer. Should such credits/reimbursements not be received by the Master Developer, the estimate of value in the Appraisal would likely be negatively impacted. 53 Assumptions and Limiting Conditions. In considering the estimate of value evidenced by the Appraisal, the Appraisal is based upon a number of standard and special assumptions which affect the estimates as to value. For example, the Appraiser has assumed that there is no adverse soil conditions, toxic substances or other environmental hazards that would interfere or inhibit development of the appraised property. Should future conditions and events 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 “APPENDIX B – THE APPRAISAL.”
Accordingly, because the Appraiser arrived at an estimate of current market value based upon certain 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.

Exposure Time. Exposure time is the length of time the subject property would have been exposed for sale in the market had it sold on the effective valuation date at the concluded market value. Exposure time is always presumed to precede the effective date of the Appraisal. Based on the Appraiser’s review of recent sales transactions for similar properties and its analysis of supply and demand in the local land market, the Appraiser’s opinion was that the probable exposure time for the appraised property at the concluded market value stated previously is 12 months.

Marketing Time. Marketing time is an estimate of the amount of time it might take to sell a property at the concluded market value immediately following the effective date of value. As the Appraiser foresees no significant changes in market conditions in the near term, the Appraiser’s opinion was that a reasonable marketing period for the appraised property in bulk is likely to be the same as the exposure time. Accordingly, the Appraiser estimated the marketing period at 12 months or less.

No assurance can be given that a sale of the property in bulk through foreclosure could be achieved or attained over an extended period of time; real estate is cyclical in nature, and it is impossible to accurately forecast and project specific demand over a particular period. See “SPECIAL RISK FACTORS – Property Values and Property Development.” 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 2023 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 “–Overlapping Liens and Priority of Lien” below.

For a description of certain risks that might affect the assumptions made in the Appraisal, see “SPECIAL RISK FACTORS” herein.
54 Value to Special Tax Burden Ratios
In comparing the value of the real property within Improvement Area No. 2 and the principal amount of the Bonds, 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. Property owners can also voluntarily add Property Assessed Clean Energy (PACE) assessment liens on their property to finance energy efficiency improvements.

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 Master Developer and subsequent merchant homebuilders, and 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 subordinate to the lien of the Special Tax.

Appraised Value to Lien Ratios by Development Status and Land Use. The following table sets forth appraised value, maximum special facilities tax, allocable debt, and value to lien ratios by development status and land use in Improvement Area No. 2 as of May 1, 2023 (the Appraiser’s date of value), based on the assumptions detailed therein. 55 Table 7
City of Roseville
Creekview Community Facilities No. 1 (Public Facilities) Improvement Area No. 2 – Series 2023 Bonds
Value to Lien Ratios by Land Use and Development Status as of May 1, 2023 CFD Debt Allocated by Projected Special Tax Levy
Ownership / Development
Status / Village / Land Use (1)
No. of
Parcels
Planned
Units
Appraised
Value (2)
FY 2023-
24 Maximum
Tax (3)
Projected
FY 2023-24
Special Tax
Levy * (4)
Allocable
Debt
CFD Bonds *
(5)(6)
% of
Total
CFD
Bonded
Debt (6)
Overlapping
Debt * (7)
Total
Direct &
Overlapping
Debt *
Average
Value to
Lien
Ratio * (6)
Phase 3
Merchant Builders - Finished Lots
C-5 (LDR) Lennar Homes 74 74 $10,730,000 $234,818 $225,301 $3,898,504 24.99% $36,493 $3,934,997 2.73 C-9 (LDR) Woodside Homes 97 97 14,550,000 307,802 295,326 5,110,183 32.76% 18,665 5,128,848 2.84 C-21 (MDR) D.R. Horton 77 77 8,778,000 192,266 184,472 3,192,017 20.46% 21,617 3,213,634 2.73 C-22 (MDR) Meritage Homes 82 82 10,004,000 204,751 196,451 3,399,296 21.79% 27,896 3,427,192 2.92 Total Phase 3 330 330 $44,062,000 $939,637 $901,550 $15,600,000 100.00% $104,671 $15,704,671 2.81 Phase 4
Master Developer - Undeveloped
C-6 (LDR) 1 48 $2,714,352 $152,315 $0 $0 0.00% $21,950 $21,950 N/A (6) C-7 (LDR) 1 74 4,184,626 234,818 0 0 0.00% 37,871 37,871 N/A (6) C-8 (LDR) 1 32 1,809,568 101,543 0 0 0.00% 4,071 4,071 N/A (6) C-20 (MDR) 1 77 3,501,454 192,266 0 0 0.00% 23,874 23,874 N/A (6) Total Phase 4 4 231 $12,210,000 $680,942 $0 $0 0.00% $87,766 $87,766 N/A (6) Total 334 561 $56,272,000 $1,620,579 $901,550 $15,600,000 100.00% $192,437 $15,792,437 3.56 (6) ___________________________________
* Preliminary, subject to change.
(1) Ownership, Development Status and Land Use as of May 1, 2023. (2) Appraised Values as of May 1, 2023.
(3) Maximum Tax refers to Maximum Annual Facilities Special Tax. (4) Special Tax refers to Special Facilities Tax.
(5) Represents the [estimated]* par amount of the 2023 Bonds. (6) The value to lien ratios of the 4 undeveloped parcels comprising of Phase 4 are shown as "N/A" since this table allocates CFD Bonded Debt using each parcel's share of the projected FY 2023-24 Special Tax levy and none of the Phase 4 territory is expected to be levied in FY 2023-24. Should the appraised value of the Phase 4 parcels be considered in the Improvement Area's overall value to lien ratio, it would be 3.56 to 1. (7) Represents the overlapping debt liens of the Improvement Area's parcels as of June 1, 2023 as summarized under "Table 8 Direct and Overlapping Tax and Assessment Debt" from the overlapping debt report prepared by California Municipal Statistics, Inc. No direct charges related to PACE liens secured by Special Taxes were levied onto the Improvement Area's parcels in FY 2022-23.

Sources: Ownership and Development Status - Integra Realty Resources, Inc. and Master Developer; Appraised Value - Integra Realty Resources, Inc.; Land Use and Planned Number of Units - Improvement Area No. 2 Special Tax Formula; PACE Lien Charges - Placer County; Overlapping Debt - California Municipal Statistics, Inc, as compiled by Willdan Financial Services and Maximum Facilities Special Tax - Willdan Financial Services. 56 No History of Special Tax Collections
Fiscal Year 2023-24 is the first year in which the Special Tax is being levied in Improvement Area No. 2. Accordingly, there is no history of special tax collections.

Overlapping Liens and 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 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 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.

Set forth below is an overlapping debt table showing the existing direct and overlapping bonded debt payable with respect to property within Improvement Area No. 2. This table has been prepared by California Municipal Statistics Inc. as of the date indicated, and is included for general information purposes only. The City has not reviewed the data for completeness or accuracy and makes no representations in connection therewith. In addition to bonded debt, property in Improvement Area No. 2 is also subject to special taxes authorized to be levied on behalf of the City’s Creekview Community Facilities District No. 2 (Public Services) and Community Facilities District No. 3 (Municipal Services) for municipal services, which districts provide for escalating annual special taxes on residential property.
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57 Table 8
City of Roseville
Creekview Community Facilities District No. 1 (Public Facilities) Improvement Area No. 2 - Series 2023 Bonds
Summary of Overlapping Debt
As of June 1, 2023
2022-23 Assessed Valuation: $ 13,021,746
DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT: % Applicable Debt Sierra Joint Community College District SFID No. 4 General Obligation Bonds 0.015% $ 22,682 Roseville Joint Union High School District General Obligation Bonds 0.034 36,995 Roseville Joint Union High School District SFID No. 1 General Obligation Bonds 0.199 127,487 Roseville City School District General Obligation Bonds 0.057 5,273 City of Roseville Creekview Community Facilities District No. 1, I.A. 2 100.000 0 (1)
TOTAL DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT $192,437 OVERLAPPING GENERAL FUND DEBT:

Placer County Certificates of Participation 0.013% $10,800 Sierra Joint Community College District Certificates of Participation 0.010 81 Roseville Joint Union High School District Certificates of Participation 0.034 21,014 Roseville City School District General Fund Obligations 0.057 3,915 Placer Mosquito and Vector Control District Certificates of Participation 0.013 246 City of Roseville Certificates of Participation 0.044 7,043 TOTAL OVERLAPPING GENERAL FUND DEBT $43,099
COMBINED TOTAL DEBT $235,536 (2)
Ratios to 2022-23 Assessed Valuation:

Direct Debt ($0).................................................................... 0.00% Total Direct and Overlapping Tax and Assessment Debt....... 1.48% Combined Total Debt ............................................................. 1.82% ____________________
(1) Excludes the 2023 Bonds to be sold.
(2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non-bonded capital lease obligations.

Sources: California Municipal Statistics, Inc; as compiled by Willdan Financial Services.

There can be no assurance that the Master Developer, its affiliates or any subsequent owner 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 Master Developer.

Private liens, such as deeds of trust securing loans obtained by the Master Developer, 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.
58 Estimated Overall Tax Burden
The following table shows the estimated overall tax burden for representative single-family residential homes in Improvement Area No. 2 (both LDR and MDR types), for Fiscal Year 2023-24.

As shown in the table, the overall estimated tax burden was approximately 1.63% for MDR homes and 1.67% for LDR homes, respectively.

Table 9
City of Roseville
Creekview Community Facilities No. 1 (Public Facilities) Improvement Area No. 2 – Series 2023 Bonds
Estimated Overall Tax Burden Fiscal Year 2023-24
Land Use Designation
Net Taxable Value MDR LDR
Projected Assessed Value - Representative Homes (1) $600,000 $725,000 Less: Homeowner's Exemption (7,000) (7,000)
Net Taxable Value $593,000 $718,000
FY 2022-23 Ad Valorem Property Taxes (2) Rate Taxes Taxes Base Property Tax 1.000000% $5,930 $7,180
Sierra Coll SFID #4 B&I 2018 Series A 0.002407% 14 17
Sierra Coll SFID #4 B&I 2018 Series B 0.016193% 96 116
Rsvl City Elem B&I 2002 Series A Non Refunding 0.005087% 30 37 Rsvl City Elem B&I 2002 Series A&B Ref 2011 0.004040% 24 29 Rsvl High B&I 1992 0.003747% 22 27
Rsvl High B&I 2004 Series C Non Refunding 0.000737% 4 5 Rsvl High B&I 2004 A,B & C Ref 2013 0.019471% 115 140
Rsvl High B&I 2008 SFID #1 11A Non-Ref 2016B 0.003617% 21 26 Rsvl High B&I 2008 SFID #1 Series 2017 0.005978% 35 43
Rsvl High B&I 2008 SFID #1 Series 2018 0.016724% 99 120 Rsvl High B&I 2008 SFID #1 Series 2019 0.007618% 45 55
Rsvl High B&I 2016 Series A 0.003005% 18 22
Rsvl High B&I 2016 Series B 0.004940% 29 35
Rsvl High B&I 2016 Series C 0.002572% 15 18
Total FY 2022-23 Ad Valorem Property Tax Rate (2) 1.096136% $6,500 $7,870 Direct Charges (3) Charges Charges
Placer County Mosquito & Vector (4) $6 $6
City of Roseville, Creekview CFD No. 1, IA No. 2 (5) 2,497 3,173 City of Roseville, Creekview CFD # 2 (Public Services (6) 483 565 City of Roseville CFD 3 (Municipal Services) (7) 309 528 Total Direct Charges $3,295 $4,272
Total Projected Taxes and Direct Charges $9,795 $12,143 Estimated Effective Tax Rate 1.63% 1.67%
___________________________________
(1) Values of Representative MDR and LDR Homes from the Ability to Pay section of the Appraisal Report. (2) The Aggregate 2022-23 Ad Valorem Property Tax Rate for TRA 005-073. Subject to change in subsequent years. (3) Direct Charges include Parcel Charges, Fee, Assessments and Special Taxes not determined by assessed value; amount assumes no optional PACE related Special Taxes.
(4) Equal to FY 2022-23 mosquito & vector charges
(5) Equal to the applicable Maximum Facilities Special Tax for FY 2023-24 (6) Equal to the applicable Maximum Public Services Special Tax for FY 2023-24 (7) Equal to the projected Maximum Municipal Services Special Tax for FY 2023-24 Sources: Aggregate FY 2022-23 Ad Valorem Tax Rate of TRA 005-073 - Placer County Resolution 2022-177; Mosquito & Vector charges - Placer County Tax Collector; Projected Assessed Values of Representative Homes - Integra Realty Resources, Inc; projected Maximum Special Tax Rates, Roseville CFD Nos. 1, 2 and 3 - Willdan Financial Services. 59 SPECIAL RISK FACTORS
The purchase of the 2023 Bonds described in this Official Statement 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.

Limited Obligation of the City to Pay Debt Service
The City has no obligation to pay principal of and interest on the 2023 Bonds in the event Special Tax collections are delinquent, other than from amounts, if any, on deposit in the 2023 Reserve Account of the Reserve Fund or funds derived from the tax sale or foreclosure and sale of parcels on which levies of the Special Tax are delinquent, nor is the City obligated to advance funds to pay such debt service on the 2023 Bonds. The 2023 Bonds are not general obligations of the City but are limited obligations of the City, payable solely from the proceeds of the Special Tax and certain funds held under the Fiscal Agent Agreement, including amounts deposited in the 2023 Reserve Account of the Reserve Fund and investment income thereon, and the proceeds, if any, from the sale of property in the event of a foreclosure. See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS.” Any tax for the payment of the 2023 Bonds will be limited to the Special Tax to be collected within Improvement Area No. 2.

Concentration of Ownership
Land in Improvement Area No. 2 is 100% owned by the Master Developer and the Merchant Builders. No assurance can be given that the Merchant Builders will complete homes on the lots that they purchase and sell the lots to individual homeowners on the timeline projected in this Official Statement or at all. In addition, no assurance can be given that the Master Developer will complete the sale of additional lots to merchant builders and others on the timeline projected by the Master Developer in this Official Statement.

Owners of property are not personally obligated to pay the Special Tax attributable to their property. Rather, the Special Tax is an obligation only against the parcel of property, secured by the amount which could be realized in a foreclosure proceeding against the property, and not by any promise of the owner to pay. If the value of the property is not sufficient, taking into account other obligations also constituting a lien against the property, the City, Fiscal Agent and owners of the 2023 Bonds have no recourse against the owner, such as filing a lawsuit to collect money.

Failure of the Master Developer, any of the Merchant Builders or any other future owner of significant property subject to the Special Taxes in Improvement Area No. 2 to pay installments of Special Taxes when due could cause the depletion of amounts in the 2023 Reserve Account of the Reserve Fund prior to reimbursement from the resale of foreclosed property or payment of the delinquent Special Tax and, consequently, result in the delinquency rate reaching a level that would cause an insufficiency in collection of the Special Tax to timely pay debt service on the 2023 Bonds.

In that event, there could be a delay or failure in payments on the 2023 Bonds. See “– Bankruptcy and Foreclosure Delays” below and “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Delinquent Payments of Special Tax; Covenant for Superior Court Foreclosure.” Appraised Values
The Appraisal summarized in APPENDIX B estimates the market value of the taxable property within Improvement Area No. 2. This market value is merely the present opinion of the Appraiser, and is subject to the assumptions and limiting conditions stated in the Appraisal. The City 60 has not sought the present opinion of any other appraiser of the value of the taxed parcels. A different present opinion of value might be rendered by a different appraiser.

The opinion of value relates to sale by a willing seller to a willing buyer as of the date of valuation, each having similar information and neither being forced by other circumstances to sell or to buy. Consequently, the opinion is of limited use in predicting the selling price at a foreclosure sale, because the sale is forced and the buyer may not have the benefit of full information.

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 which affect the estimates as to value, in addition to hypothetical conditions, as set forth in the Appraisal (see APPENDIX B hereto). Some of the improvements to be financed by the 2023 Bonds were not in place as of the date of inspection; thus, the value estimate is subject to a hypothetical condition (of such improvements being in place)
In addition, the opinion is a present opinion. It is based upon present facts and circumstances. Differing facts and circumstances may lead to differing opinions of value. The appraised market value is not evidence of future value because future facts and circumstances may differ significantly from the present.

No assurance can be given that any of the appraised property in Improvement Area No. 2 could be sold in a foreclosure for the estimated market value contained in the Appraisal. Such sale is the primary remedy available to Bondowners if that property should become delinquent in the payment of Special Taxes.

Property Values and Property Development
The value of Taxable Parcels within Improvement Area No. 2 is a critical factor in determining the investment quality of the 2023 Bonds. If a property owner defaults in the payment of the Special Tax, the City may bring an action to foreclose on the delinquent property in an attempt to obtain funds with which to pay debt service on the 2023 Bonds. Land development and land values could be adversely affected by economic and other factors beyond the City’s control, such as: a general economic downturn; adverse judgments in future litigation that could affect the scope, timing or viability of development; relocation of employers out of the area; stricter land use regulations; shortages of water, electricity, natural gas or other utilities; destruction of property caused by earthquake, flood or other natural disasters; environmental pollution or contamination.

The Appraisal information included as APPENDIX B sets forth certain assumptions of the Appraiser in estimating the market value of the property within Improvement Area No. 2 as of the date indicated. No assurance can be given that the land values are accurate if these assumptions are incorrect or that the values will not decline in the future if one or more events, such as natural disasters or adverse economic conditions, occur. See “Appraised Values” above.

Neither the City nor the Underwriter has evaluated development risks. Since these are largely business risks of the type that property owners customarily evaluate individually, and inasmuch as changes in land ownership may well mean changes in the evaluation with respect to any particular parcel, the City is issuing the 2023 Bonds without regard to any such evaluation. Thus, the issuance of the 2023 Bonds in no way implies that the City or the Underwriter has evaluated these risks or the reasonableness of these risks.
61 The following is a discussion of specific risk factors that could affect the timing or scope of property development in Improvement Area No. 2 or the value of property in Improvement Area No.

2. See also “– Covid-19 Pandemic” below.

Land Development. Land values are influenced by the level of development in the area in many respects.

First, undeveloped or partially developed land is generally less valuable than developed land and provides less security to the owners of the 2023 Bonds should it be necessary for the City to foreclose on undeveloped or partially developed property due to the nonpayment of Special Taxes.

Second, failure to complete development on a timely basis could adversely affect the land values of those parcels that have been completed. Lower land values would result in less security for the payment of principal of and interest on the 2023 Bonds and lower proceeds from any foreclosure sale necessitated by delinquencies in the payment of the Special Tax. See “VALUE OF PROPERTY WITHIN IMPROVEMENT AREA NO. 2 – Value to Special Tax Burden Ratios.” No assurance can be given that the proposed development within Improvement Area No. 2 will be completed, and in assessing the investment quality of the 2023 Bonds, prospective purchasers should evaluate the risks of noncompletion.

Neither the Master Developer nor the Merchant Builders provide any assurances to the City that the project will be developed or that sources of financing that will actually be available will be sufficient to complete the currently projected development. Neither the Master Developer nor the Merchant Builders have any obligation to the City or to owners of the 2023 Bonds to complete the project overall or their particular developments therein.

Risks of Real Estate Investment Generally. Continuing development of land within Improvement Area No. 2 may be adversely affected by changes in general or local economic conditions, fluctuations in the real estate market, increased construction costs, development, financing and marketing capabilities of individual property owners, water or electricity shortages, and other similar factors. Development in Improvement Area No. 2 may also be affected by development in surrounding areas, which may compete with development in Improvement Area No. 2. In addition, land development operations are subject to comprehensive federal, state and local regulations, including environmental, land use, zoning and building requirements. There can be no assurance that proposed land development operations within Improvement Area No. 2 will not be adversely affected by future government policies, including, but not limited to, governmental policies to restrict or control development, or future growth control initiatives. There can be no assurance that land development operations within Improvement Area No. 2 will not be adversely affected by these risks.

See also “– COVID-19 Pandemic” below.

Natural Disasters. The value of the parcels in Improvement Area No. 2 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 parcels in Improvement Area No. 2 and the continued habitability and enjoyment of such private improvements.

For example, the areas in and surrounding Improvement Area No. 2, like those in much of California, may be subject to earthquakes or other unpredictable seismic activity, however, Improvement Area No. 2 is not located in a seismic special studies zone.

Other natural disasters could include, without limitation, landslides, floods, droughts, wildfires or tornadoes. One or more natural disasters could occur and could result in damage to improvements of varying seriousness. Although the land in Improvement Area No. 2 is not in a high- 62 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. 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 parcels may well depreciate.

Drought. California has been subject to droughts from time-to-time in the past. Although the City does not believe the current drought or any future drought would impact development in Improvement Area No. 2, no assurances can be given in this regard.

The City employs a portfolio approach to its water supplies which includes the use of surface water, groundwater and recycled water. This portfolio approach is designed to provide a more reliable water supply. Surface water is the City’s primary water supply which is delivered from the Folsom Reservoir under contracts with the Bureau of Reclamation and the Placer County Water Agency. The City also uses groundwater to supplement its surface water supplies during emergency and drought conditions. These ground water wells are designated to accommodate Aquifer Storage and Recovery (“ASR”). The City’s ASR program allows for the storage of treated surface water in the groundwater basin through direct injection through the ASR wells. This water can be extracted later from the same wells for use during emergency or drought conditions. This water “banking” allows the City to use groundwater without significant impact to the ground water table when surface water supplies are limited. The City also uses recycled water generated from its wastewater treatment facilities for irrigation purposes in commercial landscaping, public rights-of way, parks and golf courses. The use of recycled water reduces the demand for treated water for these purposes and leaving more for domestic use. However, no assurance can be given that a future drought affecting homes in Improvement Area No. 2 would not result in decreased values.

The City indicates it has adequate surface water and groundwater supplies to satisfy the planned development of property in Improvement Area No. 2 in accordance with applicable law and regulations. However, in the event that the City’s water supply is severely limited or cut off by virtue of future actions beyond its control resulting from ongoing or future drought conditions, development within Improvement Area No. 2 may be delayed or even stopped. The Development Agreement provides that should the City need to restrict development it must do so City-wide and cannot single out the Creekview property in restricting development activity. Any reduction or interruption in the water supply would also likely cause a reduction in the land value and thus a reduction in the security in the event of a need to foreclose on land within Improvement Area No. 2 following a delinquency in the payment of Special Taxes.

Legal Requirements. Other events that may affect the value of a parcel include changes in the law or application of the law. Such changes may include, without limitation, local growth control initiatives, local utility connection moratoriums and local application of statewide tax and governmental spending limitation measures. Development in Improvement Area No. 2 may also be adversely affected by the application of laws protecting endangered or threatened species.

Hazardous Substances. Any discovery of a hazardous substance detected on property within Improvement Area No. 2 would affect the marketability and the value of some or all of the property in Improvement Area No. 2. In that event, the owners and operators of a parcel within Improvement Area No. 2 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 63 “CERCLA” or the “Superfund Act,” is the most well-known and widely applicable of these laws.

California laws with regard to hazardous substances are also applicable to property within Improvement Area No. 2 and are as stringent as the federal laws. 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 parcels be contaminated 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 just as is the seller.

The values set forth in the Appraisal do not take into account the possible reduction in marketability and value of any of the parcels within Improvement Area No. 2 by reason of the possible liability of the owner (or operator) for the remedy of a hazardous substance condition on a parcel.

Although the City is not aware that the owner (or operator) of any of the property within Improvement Area No. 2 has a current liability for a hazardous substance with respect to any of the parcels, 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 parcels within Improvement Area No. 2 resulting from the existence, currently, on the parcel of a substance presently classified as hazardous but which 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 which 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 a parcel within Improvement Area No. 2 that is realizable upon a foreclosure sale.

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 the Master Developer 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.

Levy and Collection of Special Taxes
General. The principal source of payment of principal of and interest on the 2023 Bonds is the proceeds of the annual levy and collection of the Special Tax against property within Improvement Area No. 2.

Limitation on Maximum Special Tax Rate. The annual levy of the Special Tax is subject to the Maximum Annual Facilities 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 2023 Bonds.

In addition to the Maximum Annual Facilities Special Tax rate limitation in the Special Tax Formula, Section 53321(d) of the 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 64 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 2023 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 of Taxable Property 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 of Taxable Property and their proportionate share of debt service on the 2023 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 of Taxable Property 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 “– Tax Delinquencies” below. There is currently no history of tax levies in Improvement Area No. 2.

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 AND SOURCES OF PAYMENT FOR THE BONDS – Delinquent Payments of Special Tax; Covenant for Superior Court Foreclosure” and in the 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 2023 Bonds pending such sales or the prosecution of foreclosure proceedings and receipt by the City of the proceeds of sale if the 2023 Reserve Account of the Reserve Fund is depleted. See “SECURITY AND SOURCES OF PAYMENT 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. 65 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.

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 Federal Deposit Insurance Corporation (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 within Improvement Area No. 2 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 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.

Bankruptcy and Foreclosure Delays
The payment of the Special Tax and the ability of the City to foreclose the lien of a delinquent unpaid tax, as discussed in “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Delinquent Payments of Special Tax; Covenant for Superior Court Foreclosure,” 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 2023 Bonds (including Bond Counsel’s approving legal opinion) will be qualified as to the enforceability of the various legal instruments by bankruptcy, insolvency, 66 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 could result in a delay in prosecuting superior court foreclosure proceedings and could result in the possibility of delinquent Special Tax installments not being paid in full. Such a delay would increase the likelihood of a delay or default in payment of the principal of and interest on the 2023 Bonds. 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 2023 Reserve Account of the Reserve Fund established for the 2023 Bonds 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 2023 Reserve Account of the Reserve Fund for transfer to the Bond Fund to make up shortfalls resulting from delinquent payments of the Special Tax and thereby to pay principal of and interest on the 2023 Bonds on a timely basis.

To the extent that bankruptcy or similar proceedings were to involve a large property owner, the chances would increase the likelihood that the 2023 Reserve Account of the Reserve Fund could be fully depleted during any resulting delay in receiving payment of delinquent Special Taxes. As a result, sufficient monies would not be available in the 2023 Reserve Account of the Reserve Fund for transfer to the Bond Fund to make up any shortfalls resulting from delinquent payments of the Special Tax and thereby to pay principal of and interest on the 2023 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 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 67 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.”
Parity Taxes and Special Assessments; Private Debt
The City, the County and certain other public agencies are authorized by the 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.

Property in Improvement Area No. 2 is currently subject to certain overlapping tax and assessment liens, as shown in the overlapping debt statement. Property in Improvement Area No. 2 is also subject to the special tax of two additional community facilities districts formed to fund services and known as the Creekview Community Facilities District No. 2 (Public Services) and the City’s Community Facilities District No. 3 (Municipal Services). The property is not subject to any other special tax or assessment liens (other than the lien of the Special Tax). See “VALUE OF PROPERTY WITHIN IMPROVEMENT AREA NO. 2 – Estimated Tax Burden on Single Family Home.”
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 of taxable property and may be secured by a lien on a parity with the lien of the Special Tax 68 securing the 2023 Bonds. The principal of and interest on the 2023 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 coequal to and independent of the lien for general taxes and any other liens imposed under the 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 if unpaid. The City, the County and certain other public agencies are authorized by the 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. 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 and Foreclosure Delays” above.

There can be no assurance that property owners within Improvement Area No. 2 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. This includes PACE assessments which homeowners can request be placed on their home for financing energy improvements. In addition to liens for special taxes or assessments to finance public improvements of benefit to land within Improvement Area No. 2, owners of property may obtain loans from banks or other private sources which loans may be secured by a lien on the parcels in Improvement Area No. 2. Such loans would increase amounts owed by the owner of such parcel with respect to development of its property in Improvement Area No. 2. However, the lien of such private loans would be subordinate to the lien of the Special Taxes.

Tax Delinquencies
Under provisions of the Act, the Special Taxes will be billed to the properties within Improvement Area No. 2 on the regular property tax bills sent to owners of such properties. Such Special Tax installments are due and payable, and bear the same penalties and interest for nonpayment, as do regular property tax installments. Special Tax installment payments cannot be made separately from property tax payments. Therefore, the unwillingness or inability of a property owner to pay regular property tax bills as evidenced by property tax delinquencies may also indicate an unwillingness or inability to make regular property tax payments and Special Tax payments in the future.

The annual Special Tax will be billed and collected in two installments payable without penalty by December 10 and April 10. In the event such Special Taxes are not timely paid, moneys available to pay debt service on the 2023 Bonds becoming due on the subsequent respective March 1 and September 1 may be insufficient, except to the extent moneys are available in the 2023 Reserve Account of the Reserve Fund.

In the event of non-payment of Special Taxes, funds in the 2023 Reserve Account of the Reserve Fund, if available, may be used to pay principal of and interest on the 2023 Bonds. If funds in the 2023 Reserve Account of the Reserve Fund for the 2023 Bonds are depleted, the funds can be replenished from the proceeds of the levy and collection of the Special Tax that are in excess of the amount required to pay all amounts to be paid to the 2023 Bond holders pursuant to the Fiscal Agent Agreement. However, no replenishment from the proceeds of a Special Tax levy can occur as long as the proceeds that are collected from the levy of the Special Tax against property within 69 Improvement Area No. 2 at the maximum Special Tax rates, together with other available funds, remains insufficient to pay all such amounts. Thus it is possible that the 2023 Reserve Account of the Reserve Fund will be depleted and not be replenished by the levy of the Special Tax.

See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Delinquent Payments of Special Tax; Covenant for Superior Court Foreclosure” for a discussion of the provisions which apply, and procedures which the City is obligated to follow, in the event of delinquency in the payment of Special Taxes. See also “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Special Tax Methodology” for a discussion of a limitation imposed by the Act applicable to Special Tax increases on residential property.

No Acceleration Provisions
The 2023 Bonds do not contain a provision allowing for the acceleration of the 2023 Bonds in the event of a payment default or other default under the terms of the 2023 Bonds or the Fiscal Agent Agreement. Under the Fiscal Agent Agreement, a 2023 Bond holder is given the right for the equal benefit and protection of all 2023 Bond holders similarly situated to pursue certain remedies.

So long as the 2023 Bonds are in book-entry form, DTC will be the sole 2023 Bond holder and will be entitled to exercise all rights and remedies of 2023 Bond holders.

Ballot Initiatives
From time to time, initiative measures qualify for the State ballot pursuant to the State’s constitutional initiative process, and those measures could be adopted by California voters. The adoption of any such initiative might place limitations on the ability of the State, the City, the County or other local districts to increase revenues or to increase appropriations or on the ability of the landowners to complete the development of Improvement Area No. 2. See “–Property Values and Property Development – Land Development” above. See also “–Voter Initiatives” below.

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 2023 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 70 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 twothirds vote of the Legislature. Article XIIIC requires that all new local taxes be submitted to the electorate before they become effective. Taxes for general governmental purposes require a majority vote and taxes for specific purposes (“special taxes”) require a two-thirds vote.

The levy of the Special Taxes and the issuance of special tax bonds of the City for Improvement Area No. 2 were each authorized by not less than a two-thirds vote of the landowners within Improvement Area No. 2 who constituted the qualified electors at the time of such voted authorization. The District believes, therefore, that issuance of the 2023 Bonds does not require the conduct of further proceedings under the Mello-Roos Act, Proposition 218 or Proposition 26.

Like their antecedents, Proposition 218 and Proposition 26 are likely to undergo both judicial and legislative scrutiny before the impact on Improvement Area No. 2 can be determined. Certain provisions of Proposition 218 and Proposition 26 may be examined by the courts for their constitutionality under both State and federal constitutional law, the outcome of which cannot be predicted.

Case Law Related to the Mello-Roos Act
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 MelloRoos Act, which generally provides that, if a special tax will not be 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 the District (including Improvement Area No. 2), there were no registered voters within the District (including 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 held for Improvement Area No. 2. 71 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 MelloRoos 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 in 2018. Therefore, 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 because the period for challenging the Special Taxes has passed, the City believes the Special Taxes are valid and cannot be challenged.

Exempt Properties
Certain properties are exempt from the Special Tax in accordance with the Special Tax Formula and the 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 the District 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.

In addition, although the 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 Act have not been tested, meaning that such property could become exempt from the Special Tax. The 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.
72 Changes in Tax Law
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 makes significant changes to many aspects of the Code that could have an impact on future property development. The Tax Act reduces the amount of mortgage interest expense and state local income tax and property tax expense that individuals may deduct from their gross income for federal income tax purposes, which could increase the cost of home ownership within Improvement Area No. 2 and could adversely affect the sale of homes by merchant builders that purchase lots from the Master Developer. However, neither the City nor the Master Developer can predict the effect that the Tax Act may have on the cost of home ownership or the price of homes in Improvement Area No. 2, the rate at which homes in Improvement Area No. 2 are sold to individual homeowners, or the ability or willingness of homeowners to pay special taxes or property taxes on Taxable Property within Improvement Area No. 2. The appraised values do not take into account any of the potential impacts of the Tax Act on home values or home sales in Improvement Area No. 2.

Pandemic Diseases
In recent years, public health authorities have warned of threats posed by outbreaks of disease and other public health threats. While adverse consequences from the spread of COVID-19 have reduced since its outbreak, other 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 the administration of the 2023 Bonds. The City is also reliant on other entities and service providers in connection with the administration of the 2023 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 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 the Master Developer, the merchant builders and individual homeowners, are permitted to prepay their Special Tax obligation 73 at any time. Such 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.

CONSTITUTIONAL LIMITATIONS ON TAXATION AND APPROPRIATIONS Article XIIIA of the California Constitution, commonly known as “Proposition 13,” provides that each county will levy the maximum ad valorem property tax permitted by Proposition 13 and will distribute the proceeds to local agencies in accordance with an allocation formula based in part on pre-Proposition 13 ad valorem property tax rates levied by local agencies.

Article XIIIA limits the maximum ad valorem tax on real property to 1% of “full cash value,” which is defined as the County Assessor’s valuation of real property as shown on the 1975-76 tax bill under full cash value, or, thereafter, the appraised value of real property when purchased, newly constructed, or a change in ownership has occurred after the 1975 assessment. The full cash value may be adjusted annually to reflect increases of no more than 2% per year or decreases in the consumer price index or comparable local data, or declining property value caused by damage, destruction or other factors.

Article XIIIA exempts from the 1% tax limitation any taxes to repay indebtedness approved by the voters prior to July 1, 1978, and requires a vote of two-thirds of the qualified electorate to impose Special Taxes or any additional ad valorem, sales, or transaction taxes on real property. In addition, Article XIIIA requires the approval of two-thirds of all members of the State Legislature to change any State laws resulting in increased tax revenues. On June 3, 1986, California voters approved an amendment to Article XIIIA of the California Constitution to allow local governments and school districts to raise their property tax rates above the constitutionally mandated 1% ceiling for the purpose of paying off certain new general obligation debt issued for the acquisition or improvement of real property and approved by two-thirds of the votes cast by the qualified electorate.

If any such voter-approved debt is issued, it may be on a parity with the lien of the Special Tax on the parcels within Improvement Area No. 2.

State and local government agencies in the State, and the State itself are subject to annual appropriation limits, imposed by Article XIIIB of the State Constitution. Article XIIIB prohibits government agencies and the State from spending “appropriations subject to limitation” in excess of the appropriations limits imposed. “Appropriations subject to limitation” are authorizations to spend “proceeds of taxes,” which consist of tax revenues, certain state subventions and certain other funds, including proceeds from regulatory licenses, user charges or other fees to the extent that such proceeds exceed the cost reasonably borne by such entity in providing the regulation, product or service. No limit is imposed on appropriations of funds which are not “proceeds of taxes” such as debt service on indebtedness existing or authorized before January 1, 1979, or subsequently authorized by the voters, appropriations required to comply with mandates of courts or the federal government, reasonable user charges or fees and certain other non-tax funds. 74 CONTINUING DISCLOSURE
The City
The City has covenanted for the benefit of owners of the 2023 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 the 2022-23 fiscal year (due April 1, 2024) and to provide notices of the occurrence of certain enumerated events.

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 E – FORM OF CONTINUING DISCLOSURE UNDERTAKINGS.” The City believes it currently is in material compliance with all of its continuing disclosure undertakings for the last five years. Notwithstanding the foregoing, in the last five years:
(1) The Annual Report for Fiscal Year 2019-20 for one series of the City’s outstanding bonds did not initially fulfill all content requirements; a remedial filing was done approximately 3 months later.
(2) The City has not in a timely manner filed all significant event notices of changes in the ratings of certain then-outstanding obligations resulting from changes in ratings to the bond insurers who insured such obligations or the underlying rates for such obligations. However, the City has submitted all undisclosed significant event notices of changes in ratings occurring during the last five years on all currently outstanding obligations.

The City believes it has made corrective filings to address the know instances during the last five years of past delayed or failure to file annual reports, omissions of required information and/or rating changes to be filed under its prior continuing disclosure undertakings.

The Master Developer
Although not an obligated party under the Rule, the Master Developer has voluntarily covenanted for the benefit of owners of the 2023 Bonds to provide certain information and operating data relating to the property it or its affiliates owns in Improvement Area No. 2 by not later than May 1st and November 1st of each year, beginning with the report due November 1, 2023 (the “Developer Periodic Reports”) and to provide notices of the occurrence of certain enumerated events. The obligation of the Master Developer to provide such information is in effect until such time as (A) 90% of the backbone infrastructure improvements for Improvement Area No. 2 only shown in the first line in Table 5 of the Official Statement have been completed and (B) the Master Developer and its affiliates own property in Improvement Area No. 2 collectively responsible for 20% or more of the Special Taxes. The Master Developer’s undertaking includes a provision that if a portion of the Master Developer’s property in Improvement Area No. 2 that is collectively responsible for 20% or more of the Special Taxes is sold, the reporting obligation may be assumed by the new owner and the Master Developer’s obligations with respect to such property will be terminated, or if not so assumed, the Master Developer is to report such required information on behalf of such property until terminated.
75 The Master Developer has had only one continuing disclosure obligation, and that was associated with the bonds issued in Improvement Area No. 1 of the District. The Master Developer terminated that obligation in December 2021, but was in compliance at all times prior to termination.

The Merchant Builders
General. Although not obligated parties under the Rule, the Master Developer and each of the Merchant Builders has voluntarily covenanted for the benefit of owners of the 2023 Bonds to provide certain information and operating data relating to the property it or its affiliates owns in Improvement Area No. 2 by not later than May 1st and November 1st of each year, beginning with the report due November 1, 2023 (the “Merchant Builder Periodic Reports”) and to provide notices of the occurrence of certain enumerated events. The obligation of the Master Developer and the Merchant Builders to provide such information is in effect until such time as the Master Developer (and its affiliates) or a Merchant Builder (and its affiliates), as applicable, no longer own or is under option to acquire property in Improvement Area No. 2 collectively responsible for 20% or more of the Special Taxes.

D.R. Horton Continuing Disclosure Compliance. D.R. Horton’s Sacramento Division is the division which will be responsible for complying with its obligations under its Developer Continuing Disclosure Certificate. D.R. Horton has advised the City that, based on a review of prior continuing disclosure obligations in Northern California, encompassing D.R. Horton’s Sacramento and Bay Area Divisions, D.R. Horton has not failed to comply in any material respect with any previous undertaking by it to provide periodic continuing disclosure reports or notice of listed events with respect to community facilities district or assessment district financings in Northern California within the past five years.

Lennar Homes Continuing Disclosure Compliance. Lennar Homes has advised the City 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..

Meritage Prior Continuing Disclosure Compliance. Meritage’s Northern California Division is the division that will be responsible for complying with its obligations under its Developer Continuing Disclosure Certificate. Meritage has advised the City that, except as described in the following paragraph, based on a review of prior continuing disclosure obligations in Northern California, Meritage has not failed to comply in any material respect with any previous undertaking by it to provide periodic continuing disclosure reports or notice of listed events with respect to community facilities district or assessment district financings in Northern California within the past five years. However, in connection with a continuing disclosure obligation entered into with respect to the $14,735,000 Improvement Area No. 2 of the City of Dixon Community Facilities District No. 2019-1 (Homestead) Special Tax Bonds, Series 2020, Meritage was late in filing its first periodic report due June 15, 2021. The oversight was discovered in August 2021, and Meritage promptly filed a curative report on August 23, 2021 or approximately two months after the due date. 76 Identification of the above-described event does not constitute a representation by Meritage that such event was material.

Woodside Continuing Disclosure Compliance. Woodside’s Northern California Division is the division which will be responsible for complying with its obligations under its Developer Continuing Disclosure Certificate. D.R. Horton has advised the City that, based on a review of prior continuing disclosure obligations in Northern California, Woodside has not failed to comply in any material respect with any previous undertaking by it to provide periodic continuing disclosure reports or notice of listed events with respect to community facilities district or assessment district financings in Northern California within the past five years.

UNDERWRITING
The 2023 Bonds were purchased through negotiation by Piper Sandler & Co., as underwriter (the “Underwriter”). The Underwriter agreed to purchase the 2023 Bonds at a price of $_____________ (which is equal to the par amount of the 2023 Bonds, plus/less an original issue premium/discount of $_____________ and less the Underwriter’s discount of $_____________).

The initial public offering prices set forth on the cover page hereof may be changed by the Underwriter. The Underwriter may offer and sell the 2023 Bonds to certain dealers and others at a price lower than the public offering prices set forth on the cover page hereof.

MUNICIPAL ADVISOR
The City has retained Hilltop Securities Inc., Encino, California, as registered municipal advisor (the “Municipal Advisor”) in connection with the issuance of the 2023 Bonds. The Municipal Advisor is not obligated to undertake, and has not undertaken to make, an independent verification or assume responsibility for the accuracy, completeness, or fairness of the information contained in this Official Statement. The fees of the Municipal Advisor are contingent upon the sale and delivery of the 2023 Bonds.

LEGAL OPINION
The validity of the 2023 Bonds and certain other legal matters are subject to the approving opinion of Jones Hall, a Professional Law Corporation, Bond Counsel. A complete copy of the proposed form of Bond Counsel opinion is contained in APPENDIX D to this Official Statement, and the final opinion will be made available to registered owners of the 2023 Bonds at the time of delivery.

The fees of Bond Counsel are contingent upon the sale and delivery of the 2023 Bonds.

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 2023 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 2023 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 Code”) 77 relating to the exclusion from gross income for federal income tax purposes of interest on obligations such as the 2023 Bonds. The District 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 2023 Bonds.

Tax Treatment of Original Issue Discount and Premium. If the initial offering price to the public at which a 2023 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 2023 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 2023 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 2023 Bonds to determine taxable gain upon disposition (including sale, redemption, or payment on maturity) of such 2023 Bond. The Tax Code contains certain provisions relating to the accrual of original issue discount in the case of purchasers of the 2023 Bonds who purchase the 2023 Bonds after the initial offering of a substantial amount of such maturity. Owners of such 2023 Bonds should consult their own tax advisors with respect to the tax consequences of ownership of 2023 Bonds with original issue discount, including the treatment of purchasers who do not purchase in the original offering, the allowance of a deduction for any loss on a sale or other disposition, and the treatment of accrued original issue discount on such 2023 Bonds under federal individual alternative minimum taxes.

Under the Tax Code, original issue premium is amortized on an annual basis over the term of the 2023 Bond (said term being the shorter of the 2023 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 2023 Bond for purposes of determining taxable gain or loss upon disposition. The amount of original issue premium on a 2023 Bond is amortized each year over the term to maturity of the 2023 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 2023 Bond premium is not deductible for federal income tax purposes. Owners of premium 2023 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 2023 Bonds.

California Tax Status. In the further opinion of Bond Counsel, interest on the 2023 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 2023 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, or marketability of, the 2023 Bonds. 78 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 2023 Bonds, or as to the consequences of owning or receiving interest on the 2023 Bonds, as of any future date. Prospective purchasers of the 2023 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 2023 Bonds should also be aware that the ownership or disposition of, or the accrual or receipt of interest on, the 2023 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 2023 Bonds, the ownership, sale or disposition of the 2023 Bonds, or the amount, accrual or receipt of interest on the 2023 Bonds.

NO RATINGS
The City has not applied to a rating agency for the assignment of a rating to the 2023 Bonds and does not contemplate applying for a rating.

NO LITIGATION
At the time of delivery of and payment for the 2023 Bonds, the City Attorney will deliver his opinion that to the best of its knowledge there is no action, suit, proceeding, inquiry or investigation at law or in equity before or by any court or regulatory agency pending against the City affecting its existence or the titles of its officers to office or seeking to restrain or to enjoin the issuance, sale or delivery of the 2023 Bonds, the application of the proceeds thereof in accordance with the Fiscal Agent Agreement, or the collection or application of the Special Tax to pay the principal of and interest on the 2023 Bonds, or in any way contesting or affecting the validity or enforceability of the 2023 Bonds, the Fiscal Agent Agreement or any action of the City contemplated by any of said documents, or in any way contesting the completeness or accuracy of this Official Statement or any amendment or supplement thereto, or contesting the powers of the City or its authority with respect to the 2023 Bonds or any action of the City contemplated by any of said documents. 79 EXECUTION
The execution and delivery of this Official Statement by the City has been duly authorized by the City Council of the City, as the legislative body of the District.

CITY OF ROSEVILLE
By:

Assistant City Manager/
Chief Financial Officer
A-1

APPENDIX A

RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX
B-1

APPENDIX B

THE APPRAISAL
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APPENDIX C

THE CITY OF ROSEVILLE AND PLACER COUNTY
The District is located in the City of Roseville (the “City”), which is located in southwestern Placer County (the “County”), California (the “State”). Certain financial and economic data for the City, County and State are presented in this appendix for information purposes only. The 2023 Bonds are not a debt or obligation of the City, County or State, but are a limited obligation of the City, secured solely by the Special Tax Revenues and other amounts pledged under the Fiscal Agent Agreement, all as described in more detail in this Official Statement.

General
The City is located in the County, which is located in the Sacramento Valley near the foothills of the Sierra Nevada mountain range, about 16 miles northeast of Sacramento and 110 miles east of San Francisco. The City presently occupies 43 square miles in the southwestern part of the County and is the largest city in the County as well as the residential and business center of the County. It is bordered by Sacramento County to the south, the City of Rocklin to the north and un-incorporated Placer County to the east and west. The estimated population of the City as of January 2023 was approximately 152,928.

The City has warm summers typical of central California, with an average July temperature of 77 degrees. Winter temperatures are moderate; the average January temperature is 46 degrees. The temperature drops below freezing an average of eight days per year. Rainfall averages 20 inches annually and falls mostly during the winter.

The City is predominately comprised of residential housing, small and large businesses, as well as numerous retail centers, the latter of which play a vital role in the economy of the City and contribute significantly to City and County sales tax receipts. The City has the thirteenth highest retail sales of all cities in the State, and the City is considered a regional shopping destination. The Westfield Galleria at Roseville is the main shopping center in the City and the second largest shopping mall in Northern California. Across from the Westfield Galleria lies the “Fountains at Roseville,” a 330,000 square foot retail center, containing additional stores and several recreation centers. Plans call for future construction of hotel, additional retail, and office buildings in connection with the Fountains at Roseville project. In addition to the Westfield Galleria and Fountains at Roseville, the City has many shopping plazas surrounding the Westfield Galleria and the Douglas Boulevard financial corridor. The City is also home to one of the largest auto malls in the United States and a popular water park, Roseville Golfland-SunSplash.

Municipal Government
The City was incorporated on April 10, 1909 and is a charter city. The City operates under the council-manager form of government, with a five-member City Council elected by district for staggered four-year terms.

City services include, among others, police and fire protection, library services, street maintenance, and parks and recreation. The City also owns two golf courses and provides its own electricity, water, sewer and refuse services to its citizens.

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Population
The following table sets forth population estimates for the City, County and State for the past five years.

POPULATION ESTIMATES
City, County and State
Calendar Years 2019 through 2023, as of January 1
Year
City of
Roseville Placer County State of California
2019 141,097 395,345 39,605,361
2020 143,493 399,015› 39,648,938
2021 148,736 406,688 39,286,510
2022 151,450 409,441 39,078,674
2023 152,928 410,305 38,940,231
Source: California State Department of Finance.
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Effective Buying Income
Effective buying income (“EBI”) is designated as personal income less personal tax and non-tax payments. Personal income is the aggregate of wages and salaries, other labor 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, personal 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), non-tax payments (such as fines, fees, penalties), and personal contributions for social insurance. Effective buying income is a bulk measure of market potential. It indicates the general ability to buy and is essential in comparing, selecting and grouping markets on that basis. The following table demonstrates the growth in annual estimated EBI for the City, the County, the State and the United States.

EFFECTIVE BUYING INCOME (EBI)
City, County, State and United States
As of January 1, 2019 through 2023
Year Area
Total Effective
Buying Income
(000’s Omitted)
Median
Household
Effective Buying
Income
2019 City of Roseville $4,981,208 $75,784
Placer County 14,736,480 74,797
California 1,183,264,399 62,637
United States 9,017,967,563 52,841
2020 City of Roseville $4,834,974 $72,395
Placer County 14,333,583 72,431
California 1,243,564,816 65,870
United States 9,487,165,436 55,303
2021 City of Roseville $4,126,395 $66,668
Placer County 12,122,101 65,269
California 1,036,142,723 55,681
United States 8,132,748,136 48,043
2022 City of Roseville $6,165,433 $87,539
Placer County 18,491,490 88,051
California 1,452,426,153 77,058
United States 11,208,582,541 64,448
2023 City of Roseville $6,996,310 $92,853
Placer County 19,349,979 91,862
California 1,461,799,662 77,175
United States 11,454,846,397 65,326
Source: Claritas, LLC.

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Employment and Industry
The unemployment rate in the Sacramento--Roseville--Arden-Arcade MSA was 3.8 percent in April 2023, down from a revised 4.4 percent in March 2023, and above the year-ago estimate of 3.4 percent. This compares with an unadjusted unemployment rate of 4.3 percent for California and 3.1 percent for the nation during the same period. The unemployment rate was 3.6 percent in El Dorado County, 3.3 percent in Placer County, 3.9 percent in Sacramento County, and 4.3 percent in Yolo County.

The following table summarizes the civilian labor force, employment and unemployment, as well as employment by industry, in the Sacramento--Arden-Arcade--Roseville MSA for the years 2018 through 2022.

CIVILIAN LABOR FORCE, EMPLOYMENT AND UNEMPLOYMENT
Sacramento Arden Arcade Roseville Metropolitan Statistical Area (El Dorado, Placer, Sacramento, and Yolo Counties)
Civilian Labor Force, Employment and Unemployment
Annual Averages
2018 2019 2020 2021 2022
Civilian Labor Force (1) 1,088,500 1,101,200 1,095,600 1,107,800 1,124,500 Employment 1,047,200 1,061,100 998,400 1,036,700 1,082,500 Unemployment 41,200 40,100 97,200 71,100 42,000
Unemployment Rate 3.8% 3.6% 8.9% 6.4% 3.7%
Wage and Salary Employment (2)
Agriculture 9,100 8,700 8,300 9,000 8,600
Mining and Logging 400 500 500 500 500
Construction 64,500 69,400 70,200 74,900 76,800
Manufacturing 36,000 36,800 36,100 37,700 40,300
Wholesale Trade 28,400 28,600 26,600 26,900 28,300
Retail Trade 102,000 100,500 95,100 101,600 100,800
Transportation, Warehousing and Utilities 29,500 32,200 34,300 37,500 40,500 Information 12,400 11,900 10,200 10,100 10,500
Finance and Insurance 36,700 35,200 34,800 34,100 33,200 Real Estate and Rental and Leasing 16,800 17,300 16,900 17,700 19,100 Professional and Business Services 136,000 137,300 133,500 140,600 147,500 Educational and Health Services 159,800 166,600 164,000 168,800 175,400 Leisure and Hospitality 106,200 109,600 83,900 93,600 108,700 Other Services 34,200 35,400 31,000 33,300 36,100
Federal Government 14,100 14,200 14,800 14,500 14,300
State Government 120,400 121,900 121,700 127,300 128,700 Local Government 103,500 105,300 98,900 98,400 102,900
Total, All Industries (3) 1,009,900 1,031,300 980,700 1,025,400 1,072,300

(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 C-5
Major Employers
The following table lists the major employers within the County, in alphabetical order.

MAJOR EMPLOYERS
Placer County
(In Alphabetical Order)
May 2023
Employer Location Industry
Backyard Bar & BBQ Truckee Restaurants
City of Roseville Roseville Government Offices-City/Village & Twp City of Roseville California Roseville Government Offices-City/Village & Twp Costco Wholesale Roseville Wholesale Clubs
Golfland Sunsplash Roseville Roseville Golf Courses-Miniature Kaiser Permanente Roseville MD Roseville Hospitals
Northstar California Truckee Resorts
Oracle Rocklin Computer Software-Manufacturers
Palisades Tahoe-Alpine Meadows Alpine Meadows Resorts
Placer County Fire Dept Auburn Fire Departments
Placer County Food Stamps Auburn County Government-Social/Human Resources Placer County Sheriff Auburn Government Offices-County
Placer County Sheriff Dept Tahoe City Government Offices-County PRIDE Industries Roseville Employment Agencies & Opportunities Resort At Squaw Creek A Alpine Meadows Hotels & Motels
Roseville Toyota Roseville Automobile Dealers-New Cars
Sheriff’s Training Auburn Government Offices-County
Sierra Joint Cmnty Clg Dist Rocklin School Districts
Stagg Howard A Pro Corp Roseville Attorneys
Sutter Auburn Faith Hospital Auburn Hospitals
Sutter Roseville Med Ctr Fndtn Roseville Hospitals
TASQ Technology Roseville Importers (whls)
Thunder Valley Casino Lincoln Casinos
Union Pacific Railroad Co Roseville Railroads
Walmart Supercenter Roseville Department Stores
Source: State of California Employment Development Department, extracted from the America’s Labor Market Information System (ALMIS) Employer Database, 2023 2nd Edition.

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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, 2022.

PRINCIPAL EMPLOYERS
City of Roseville
As of June 30, 2022
Employer
Number of
Employees
The Kaiser Permanente Medical Group & Foundation Group 5,900 PRIDE Industries 5,342
Sutter Roseville Medical Group 3,361
Adventist Health 1,500
City of Roseville 1,277
Union Pacific Railroad Company 1,150
Roseville City School District 1,133
Roseville Joint Union High School 1,005
Penumbra 600
Consolidated Communications 507
Total – Top Ten 21,865
Total City-Wide Employment 92,281
Source: City of Roseville Comprehensive Annual Financial Report for Fiscal Year 2021-22.

Construction Permits
The following table shows valuations of residential and non-residential building permits issued for calendar years 2018 through 2022. Annual figures are not yet available for 2023.

BUILDING PERMIT VALUATION
City of Roseville
(Valuation in Thousands of Dollars)
2018 2019 2020 2021 2022
Permit Valuation
New Single-family $220,813.8 $265,615.3 $322,748.5 $467,676.3 $420,490.6 New Multi-family 0.0 6,855.8 46,469.0 0.0 1,552.1
Res. Alterations/Additions 8,598.7 16,133.8 5,126.3 39,648.3 5,529.1 Total Residential $229,412.5 $288,604.9 $374,343.8 $507,324.6 $427,571.8 New Commercial $21,072.5 $24,136.7 $23,230.8 $16,627.7 $40,882.5 New Industrial 0.0 0.0 0.0 0.0 0.0
New Other 11,541.4 9,358.1 12,610.6 12,351.9 7,312.1
Com. Alterations/Additions 38,098.5 46,155.6 24,553.9 29,192.0 42,938.9 Total Nonresidential $70,712.4 $79,650.40 $60,395.3 $58,171.6 $91,133.5 New Dwelling Units
Single-Family 806 1,001 1,226 1,860 1,618
Multiple Family 0 65 372 0 18
Total New Dwelling Units 806 1,066 1,598 1860 1,636
Source: Construction Industry Research Board, Building Permit Summary.

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The County’s 2022-23 assessment roll totaled $97,541,982,154 as compared to the prior year’s assessment roll of $89,326,713,518, which reflected a 9.20% increase this year. These numbers over the last two years contrast with the real estate decline years of 2008 and after, where the County assessment roll experienced declines.

The following table shows residential and non-residential building permits issued within the County for calendar years 2018 through 2022. Annual figures are not yet available for 2023.

BUILDING PERMIT VALUATION
County of Placer
(Valuation in Thousands of Dollars)
2018 2019 2020 2021 2022
Permit Valuation
New Single-family $696,737.4 $693,647.7 $827,822.1 $1,323,114.6 $1,193,148.4 New Multi-family 23,384.7 7,896.7 72,442.8 11,183.1 40,312.6 Res. Alterations/Additions 99,341.6 86,964.2 52,440.8 107,613.1 82,331.3 Total Residential $819,463.7 $788,508.6 $952,705.7 $1,441,910.8 $1,315,792.3 New Commercial $90,424.4 $73,609.7 $58,855.0 $52,238.1 $105,124.2 New Industrial 7,956.4 268.7 25.0 1,155.5 0.0
New Other 68,208.3 110,951.1 76,576.0 73,032.7 116,224.1 Com. Alterations/Additions 84,271.0 78,159.7 49,149.7 58,371.2 80,371.0 Total Nonresidential $250,860.1 $262,989.2 $184,605.7 $184,797.5 $301,719.3 New Dwelling Units
Single-Family 1,963 2,080 2,552 4,176 3,701
Multiple Family 19 71 540 66 351
Total New Dwelling Units 1,982 2,151 3,092 4,242 4,052
Source: Construction Industry Research Board, Building Permit Summary. [Remainder of page intentionally left blank]
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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.

The total taxable sales during calendar year 2022 in the City were reported to be $5,934,936,479, a 5.63% increase from the total taxable sales of $5,618,718,251 reported during the calendar year 2021.

CITY OF ROSEVILLE
Taxable Transactions
Calendar Years 2018 through 2022
(Dollars in Thousands)
Retail Stores Total All Outlets
Number
of Permits
Taxable
Transactions
Number
of Permits
Taxable
Transactions
2018 3,705 4,048,870 5,393 4,767,160
2019 3,748 4,021,058 5,578 4,889,702
2020 3,912 3,692,180 5,968 4,425,817
2021 3,623 4,800,774 5,602 5,618,718
2022 3,676 5,039,926 5,847 5,934,936
Source: State Department of Tax and Fee Administration
The total taxable sales during calendar year 2022 in the County were reported to be $13,351,486,567, an 5.69% increase over the total taxable sales of $12,632,960,416 reported during calendar year 2021.

PLACER COUNTY
Taxable Transactions
Calendar Years 2018 through 2022
(Dollars in Thousands)
Retail Stores Total All Outlets
Number
of Permits
Taxable
Transactions
Number
of Permits
Taxable
Transactions
2018 8,717 7,724,326 13,794 9,909,906
2019 8,771 7,943,537 14,193 10,341,805
2020 9,165 7,931,068 15,141 10,319,123
2021 8,130 9,627,064 13,720 12,632,960
2022 8,201 10,051,067 14,163 13,351,487
Source: State Department of Tax and Fee Administration.

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Transportation
The County’s transportation network is an integral part of its development. Centrally located in the State, the area is the hub of several major highways. Interstate 80 runs through the County, connecting San Francisco to New York. Highway 65 runs north from I-80 to Lincoln and Marysville. Interstate 5, which is west of the County, runs north to Seattle and south to Los Angeles. In the City, the major highways in the area are Interstate 80 and Interstate 5, and State Highways 65, 50, and 99.

Union Pacific Railroad bought Southern Pacific in 1996 and the J.R. Davis Yard, located in Roseville, is the largest rail facility on the West Coast. Union Pacific owns and operates track in 23 states, primarily west of the Mississippi River. Amtrak provides passenger service daily to San Francisco and San Jose, and the California Zephyr connects the County to the Midwest and Chicago.

Greyhound operates a station in Roseville, providing interstate destination services.

Greyhound also operates throughout the County, with bus depots or regularly scheduled stops in most of the communities along major highways and roads.

Sacramento International Airport is serves the Roseville area. Served by ten major carriers and several commuter airlines, as well as air freight carriers, the airport handles passenger flights to over 140 cities with more than 130 scheduled departures per day and 4.3 million passengers annually. Nearby Auburn Municipal Airport serves charter and private aircraft for coastal, state and transcontinental flights. Executive air service is available as well. Auburn Municipal has an elevation of 1,520 feet and an east/west runway 3,100 feet in length.

Several trucking companies serve the County, ranging from interstate lines to local haulers, and transporting a wide variety of goods. United Parcel Service, with a distribution center in Rocklin, offers freight transportation services as well. [Remainder of page intentionally left blank]
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APPENDIX D

FORM OF OPINION OF BOND COUNSEL
[Closing Date]
City Council
City of Roseville
311 Vernon Street
Roseville, California 95678
OPINION: $__________ City of Roseville Creekview Community Facilities District No. 1 (Public Facilities) Improvement Area No. 2 Special Tax Bonds Series 2023 Members of the City Council:

We have acted as bond counsel to the City of Roseville (the “City”) in connection with the issuance by the City of the $__________ City of Roseville Creekview Community Facilities District No. 1 (Public Facilities) Improvement Area No. 2 Special Tax Bonds Series 2023 (the “Bonds”), pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, constituting Section 53311, et seq. of the California Government Code (the “Act”) and a Fiscal Agent Agreement dated as of July 1, 2023 (the “Fiscal Agent Agreement”), by and between the City, on behalf of the City of Roseville Creekview Community Facilities District No. 1 (Public Facilities), and U.S. Bank Trust Company, National Association, as fiscal agent. We have examined the law 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 the foregoing, we are of the opinion, under existing law, as follows:

1. The City is duly created and validly existing as a public body, corporate and politic, with the power to adopt the resolution authorizing the issuance of the Bonds, enter into the Fiscal Agent Agreement and 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 valid and binding limited obligations of the City, payable solely from the sources provided therefor in the Fiscal Agent Agreement.

3. The Fiscal Agent Agreement has been duly entered into by the City and constitutes a valid and binding obligation of the City enforceable upon the City.

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4. Pursuant to the Act, the Fiscal Agent Agreement creates a valid lien on the funds pledged by the Fiscal Agent Agreement.

5. The 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 tax.

Interest on the Bonds may be subject to the corporate alternative minimum tax. The opinions set forth in the preceding sentence are subject to the condition that the City comply with all requirements of the Internal Revenue Code of 1986, as amended, relating to the exclusion from gross income for federal income tax purposes of interest on obligations such as the Bonds. 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.

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

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 are limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors’ rights generally, and by equitable principles, whether considered at law or in equity.

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

Respectfully submitted,
A Professional Law Corporation
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APPENDIX E

FORMS OF CONTINUING DISCLOSURE UNDERTAKINGS

CONTINUING DISCLOSURE CERTIFICATE
(City)
This CONTINUING DISCLOSURE CERTIFICATE (this “Disclosure Certificate”) dated as of July 1, 2023, is executed and delivered by the CITY OF ROSEVILLE (the “City”) in connection with the execution and delivery of its City of Roseville Creekview Community Facilities District No. 1 (Public Facilities) Improvement Area No. 2 Special Tax Bonds Series 2023 (the “Bonds”). The Bonds are being executed and delivered pursuant to a Fiscal Agent Agreement dated as of July 1, 2023 (the “Fiscal Agent Agreement”), by and between the City and U.S. Bank Trust Company, National Association, as fiscal agent (the “Fiscal Agent”).

The District 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).

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“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, commencing April 1, 2024, with the report for the 2022-23 fiscal year, provide to the MSRB, in an electronic format as prescribed by the MSRB, an Annual Report that is consistent with the requirements of Section 4 of this Disclosure Certificate. 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 Annual 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, the City shall provide (or cause the Dissemination Agent to provide) in a timely manner to the MSRB a notice to such effect, in an electronic format as prescribed by the MSRB.
(c) With respect to each Annual Report, the Dissemination Agent shall:
(i) determine prior to each Annual Report Date the then-applicable rules and electronic format prescribed by the MSRB for the filing of annual continuing disclosure reports; and
(ii) if the Dissemination Agent is other than the City, file a report with the City 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:
(a) The City’s 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 City’s audited financial statements are not available by the Annual Report Date, the Annual Report shall contain unaudited financial statements in a format similar to the financial statements contained in the Official Statement, and the audited financial statements shall be filed in the same manner as the Annual Report when they become available.
(b) The following information, unless otherwise specified, as of September 30 of the preceding year:

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(i) Principal amount of all outstanding bonds of Improvement Area No. 2. (ii) Balance in the Improvement Fund.
(iii) Balance in 2023 Reserve Account of the Reserve Fund, and statement of the Reserve Requirement for the Bonds. Statement of projected draws on the 2023 Reserve Account of the Reserve Fund, if any.
(iv) Balance in other funds and accounts held by the City or fiscal agent related to the Bonds.
(v) Additional debt authorized by the City and payable from or secured by assessments or special taxes with respect to property within Improvement Area No. 2. (vi) The Special Tax levy, the delinquency rate, total amount of delinquencies, number of parcels delinquent in payment for the five most recent fiscal years. (vii) Notwithstanding the September 30 reporting date, the following information shall be reported as of the last day of the month immediately preceding the date of the Annual Report rather than as of September 30. Identity of each delinquent taxpayer responsible for 5 percent or more of total Special Tax levied, and the following information:
assessor parcel number, assessed value of applicable properties, amount of Special Tax levied, amount delinquent by parcel number and status of foreclosure proceedings. If any foreclosure has been completed, summary of results of foreclosure sales or transfers. (viii) Most recently available total assessed value of all parcels subject to the Special Tax.
(ix) List of landowners and assessor’s parcel number of parcels subject to 20% or more of the Special Tax levy including the following information: development status and land use classification, to the extent shown in City records as of April 30 of the preceding fiscal year and assessed value (land and improvements). (c) In addition to any of the information expressly required to be provided under this Disclosure Certificate, the City shall provide such further material 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.
(d) 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.

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Section 5. Reporting of Significant 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) 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 security, or other material events affecting the tax status of the security.
(7) Modifications to rights of security holders, if material. (8) Bond calls, if material, and tender offers.
(9) Defeasances.
(10) Release, substitution, or sale of property securing repayment of the securities, if material.
(11) Rating changes.
(12) Bankruptcy, insolvency, receivership or similar event of the City or other obligated person.
(13) The consummation of a merger, consolidation, or acquisition involving the City or an obligated person, or the sale of all or substantially all of the assets of the City or an obligated person (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 a 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 the definition of “financial obligation,” see clause (e)).

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(16) Default, 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 the 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, 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. The Dissemination Agent shall not be responsible for determining whether an event is material. (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. (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 MSRB consistent with the Rule.

Section 6. Identifying Information for Filings with the MSRB. All documents provided to the MSRB pursuant to this 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).

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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 Dissemination Agent, with or without appointing a successor Dissemination Agent. Any Dissemination Agent may resign by providing 30 days’ written notice to the City.

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 (i) 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 (ii) does not, in the opinion of 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 Report 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 this Disclosure Certificate modifying the accounting principles to be followed in preparing financial statements, the Annual Report for the year in which the change is made shall present a comparison between the financial statements or information 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 any amendment made pursuant to this Section 9 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 E-7
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. Default. If the City fails 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 12. Duties, Immunities and Liabilities of Dissemination Agent. (a) 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 they 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 by the City hereunder and shall not be deemed to be acting in any fiduciary capacity for the City, the Bond holders, 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. (b) The Dissemination Agent shall be paid compensation by the City for its services provided hereunder in accordance with its schedule of fees as amended from time to time, and shall be reimbursed for all expenses, legal fees and advances made or incurred by the Dissemination Agent in the performance of its duties hereunder.

Section 13. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the City, the Dissemination Agent, the Participating Underwriter and the holders and beneficial owners from time to time of the Bonds, and shall create no rights in any other person or entity.

Section 14. 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.

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IN WITNESS WHEREOF, the parties hereto have executed this Disclosure Certificate as of the date first above written.

CITY OF ROSEVILLE, for and on behalf of
City of Roseville Creekview Community
Facilities District No. 1 (Public Facilities)
By:

Name:

Title:

WILLDAN FINANCIAL SERVICES, as
Dissemination Agent
By:

Name:

Title:

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CONTINUING DISCLOSURE CERTIFICATE
([Name of Merchant Builder])
THIS CONTINUING DISCLOSURE AGREEMENT ([NAME OF MERCHANT BUILDER]) (the “Disclosure Certificate”) dated as of July 1, 2023, is executed by ______________ (the “Builder”) in connection with the execution and delivery by the City of Roseville of its City of Roseville Creekview Community Facilities District No. 1 (Public Facilities) Improvement Area No. 2 Special Tax Bonds Series 2023 (the “Bonds”). The Bonds are being executed and delivered pursuant to a Fiscal Agent Agreement dated as of July 1, 2023 (the “Fiscal Agent Agreement”), by and between the City and U.S. Bank Trust Company, National Association, as fiscal agent.

The Builder covenants and agrees as follows:

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

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 herein, the following capitalized terms shall have the following meanings:
“Affiliate” means any person presently directly (or indirectly through one or more intermediaries) under managerial control of the Builder, and about whom information could be material to potential investors in their investment decision regarding the Bonds (including without limitation information relevant to the proposed development of the Property or to the Builder's ability to pay the Special Taxes levied on the Property prior to delinquency). “Assumption Agreement” means an undertaking of a Major Owner 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 property owned by such Major Owner in Improvement Area No. 2), whereby such Major Owner 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, at the option of the Builder or such Major Owner, agrees to indemnify the Dissemination Agent (if any) pursuant to a provision substantially in the form of Section 11 hereof.
“Dissemination Agent” means the Builder, or any successor Dissemination Agent designated in writing by the Builder, and which has filed with the Builder, 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. “District” means the City of Roseville Creekview Community Facilities District No. 1 (Public Facilities).
“Hearthstone Landbank” means [FOR D.R. HORTON: Winding Creek C-21 – Roseville] [FOR MERITAGE/LENNAR/WOODSIDE: NOT APPLICABLE].
“Improvement Area No. 2” means the improvement area designated as such within the District.

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“Listed Events” means any of the events listed in Section 5(a) of this Disclosure Certificate.
“Major Owner” means, as of any date of determination, a Person that owns land in Improvement Area No. 2 that is collectively responsible for 20% or more of the Special Taxes in Improvement Area No. 2.
“MSRB” means the Municipal Securities Rulemaking Board, which has been designated by the Securities and Exchange Commission as the sole repository of disclosure information, or any other repository of disclosure information that may be designated by the Securities and Exchange Commission as such in the future.
“Official Statement” means the final Official Statement executed by the City in connection with the issuance of the Bonds.
“Option Agreement” means that [FOR D.R. HORTON: Option and Development Agreement dated __________, between the Hearthstone Landbank and the Builder] [FOR MERITAGE/LENNAR/WOODSIDE: NOT APPLICABLE].
“Participating Underwriter” means Piper Sandler & Co., the original Underwriter of the Bonds.
“Periodic Report” means any Periodic Report provided by the Builder 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, as of the date of determination, the real property within the boundaries of Improvement Area No. 2 that is owned by (i) the Builder, (ii) any Affiliate of the Builder, (iii) [FOR D.R. HORTON ONLY: Hearthstone Landbank (during the term of the Option Agreement),] and (iv) the property in Improvement Area No. 2 that the Builder sold to a Major Owner who has not assumed the undertakings of this Disclosure Certificate under Section 6(b) and that is owned by such Major Owner.
“Report Date” means May 1 and November 1 of each year.
“Special Taxes” means the special taxes levied on the Property for Improvement Area No. 2.

Section 3. Provision of Periodic Reports.
(a) So long as Builder’s obligations under this Disclosure Certificate have not been terminated pursuant to Section 6 below, the Builder shall, or, upon written direction of the Builder the Dissemination Agent shall, not later than the Report Date, commencing November 1, 2023, file or cause to be filed with the MSRB 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 Builder shall provide the Periodic Report to the Dissemination Agent (if different from the Builder). The Builder shall provide a E-11
written certification with (or included as a part of) each Periodic Report furnished to the Dissemination Agent (if different from the Builder), 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 (if different than the Builder), the Participating Underwriter and the City may conclusively rely upon such certification of the Builder 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 (if different than the Builder) 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 Builder that the Periodic Report has not been provided as required under Section 3(a) above. The reminder notice shall instruct the Builder 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 Builder does not provide, or cause the Dissemination Agent to provide, a Periodic Report to the MSRB by the Report Date as required in subsection (a) above, the Dissemination Agent shall send a notice to the MSRB to such effect, in substantially the form prescribed by the MSRB, with a copy to the City and the Participating Underwriter.
(c) The Dissemination Agent shall:
(i) determine prior to each Report Date the then-applicable rules and electronic format prescribed by the MSRB for the filing of continuing disclosure reports; and
(ii) to the extent the Periodic Report has been furnished to it, file a report with the Builder (if the Dissemination Agent is other than the Builder), the City and the Participating Underwriter certifying that the Periodic Report has been provided pursuant to this Disclosure Certificate, and stating the date it was provided.

Section 4. Content of Periodic Reports. Each Periodic Report shall contain or incorporate by reference the information set forth in Exhibit A relating to the Builder, any or all of which may be included by specific reference to other documents, including official statements of debt issues of the Builder 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. If the document included by reference is a final official statement, it must be available from the MSRB. The Builder shall clearly identify each such other document so included by reference.

In addition to any of the information expressly required to be provided in Exhibit A, each 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) So long as Builder’s obligations under this Disclosure Certificate have not been terminated pursuant to Section 6 below, the Builder 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:

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(i) bankruptcy or insolvency proceedings commenced by or against the Builder and, if known, any bankruptcy or insolvency proceedings commenced by or against any Affiliate of the Builder, that is reasonably likely to have a significant impact on the Builder’s ability to pay Special Taxes 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 Builder upon discovery thereof; (iii) filing of a lawsuit of which the Builder is aware against the Builder or an Affiliate seeking damages, which, if successful, could have a material and adverse impact on the Builder’s ability to pay Special Taxes prior to delinquency 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 Builder on any loan with respect to the construction of improvements on the Property that continues to exist beyond any applicable notice and cure periods on any loan with respect to the construction of improvements on the Property.
(b) Whenever the Builder obtains knowledge of the occurrence of a Listed Event, the Builder shall as soon as possible determine if such event would be material under applicable Federal securities law.
(c) If the Builder determines that knowledge of the occurrence of a Listed Event would be material under applicable Federal securities law, the Builder shall, or shall cause the Dissemination Agent to, promptly file a notice of such occurrence with the MSRB, with a copy to the City and the Participating Underwriter.

Section 6. Duration of Reporting Obligation.
(a) All the Builder’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;
(ii) at such time as the Property in Improvement Area No. 2 is collectively responsible for less than 20% of the Special Taxes; or
(iii) the date on which all of the Special Taxes attributable to the Property are prepaid in full.

The Builder 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 is conveyed to a Person that, upon such conveyance, will be a Major Owner, the obligations of the Builder hereunder with respect to the Property E-13
conveyed to the Major Owner may be assumed by such Major Owner, and the Builder’s obligations hereunder with respect to the Property conveyed will be terminated. In order to effect such assumption, such Major Owner shall enter into an Assumption Agreement in form and substance equivalent to this Disclosure Certificate or as otherwise satisfactory to the City and the Participating Underwriter. However, a Major Owner shall not be required to enter into an Assumption Agreement if such Major Owner is already a party to a continuing disclosure certificate in form and substance similar to this Disclosure Certificate with respect to the Bonds, and under which the Property conveyed to such Major Owner will become subject to future Periodic Reports. If a Major Owner required by this Section 6(b) to enter into an Assumption Agreement does not enter into an Assumption Agreement, then the Builder shall continue reporting on the Property conveyed to the Major Owner so long as it is owned by such Major Owner or until an Assumption Agreement is executed or until the Builder’s obligations may be terminated in accordance with Section 6(a).

Section 7. Dissemination Agent. The Builder may, from time to time, appoint or engage a Dissemination Agent to assist the Builder 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 Dissemination Agent may resign by providing thirty days’ written notice to the City, the Builder and the Participating Underwriter.

Section 8. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate, the Builder may amend this Disclosure Certificate, and any provision of this Disclosure Certificate may be waived, provided that the following conditions are satisfied (provided, however, that the Dissemination Agent shall not be obligated under any such amendment that modifies or increases its duties or obligations hereunder without its written consent thereto):
(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 the Builder with respect to the Bonds, or type of business conducted; and (b) the proposed amendment or waiver either (i) is approved by holders of the Bonds in the manner provided in the Fiscal Agent Agreement, with the consent of holders, or (ii) does not, in the opinion of nationally recognized bond counsel, materially impair the interests of the holders or beneficial owners of the Bonds.

Section 9. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the Builder 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 Builder 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 Builder 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 Builder to comply with any provision of this Disclosure Certificate, the City, 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 Builder to comply with its obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not E-14
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 Builder to comply with this Disclosure Certificate shall be an action to compel performance.

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 Builder 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 (i) losses, liabilities, costs and expenses due to an Indemnified Party’s negligence or willful misconduct or failure to perform its duties hereunder and (ii) losses, expenses and liabilities due to the failure of the City to pay the fees and expenses of the Dissemination Agent. The Dissemination Agent (if other than the Builder) shall be paid compensation for its services provided hereunder from Special Taxes levied for administration of the CFD in accordance with the Dissemination Agent’s 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 Builder, the Bond owners, or any other party. The obligations of the Builder under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds, but shall be assumed by a Major Owner from and after the date of such assumption when property is sold to a Major Owner and such Major Owner enters into an Assumption Agreement.

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

To the Builder: ______________
______________
Attn: ______________
______________
______________
Email: ______________
To the City: City of Roseville
Attn: CFD Administrator
311 Vernon Street
Roseville, CA 95678
To the Participating
Underwriter: Piper Sandler & Co.

Attn: Managing Director
2321 Rosecrans Avenue, Suite 3200
El Segundo, CA 90245
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.

E-15
Section 13. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the City, the Builder (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 Builder hereunder shall be assumed by any legal successor to the obligations of the Builder as a result of a sale, merger, consolidation or other reorganization.

IN WITNESS WHEREOF, the Builder has executed this Disclosure Certificate as of the date first above written.
___________________________,
a _________________
By:

Name:

Title:

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EXHIBIT A

PERIODIC REPORT
[MAY 1, ____ / NOVEMBER 1, _____]
$____________

CITY OF ROSEVILLE
CREEKVIEW COMMUNITY FACILITIES DISTRICT NO. 1 (PUBLIC FACILITIES) IMPROVEMENT AREA NO. 2

SPECIAL TAX BONDS
SERIES 2023
This Periodic Report is hereby submitted under Section 4 of the Continuing Disclosure Certificate ([Name of Merchant Builder]) (the “Disclosure Certificate”) dated July 1, 2023, executed by the undersigned (the “Builder”) in connection with the issuance of the abovecaptioned bonds by the City of Roseville (the “City”) with respect to its City of Roseville Creekview Community Facilities District No. 1 (Public Facilities) (the “District”).

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 due date of this Periodic Report).

A. Description of the Property in Improvement Area No. 2, in substance and form similar to such information in the Official Statement for the Bonds under the heading “MERCHANT BUILDER INFORMATION – [Lennar Homes] [Woodside] [Meritage] [D.R. Horton]”:
______________________________________________________________________ ______________________________________________________________________ B. Updated information regarding land development and home construction activities with respect to the Property described in the Official Statement for the Bonds under the heading “MERCHANT BUILDER INFORMATION – [Lennar Homes] [Woodside] [Meritage] [D.R. Horton]” or the Periodic Report last filed in accordance with the Disclosure Certificate, [FOR D.R. HORTON ONLY: including the number of parcels acquired by the Builder from the Hearthstone Landbank pursuant to the Option Agreement]:
______________________________________________________________________ ______________________________________________________________________ C. Status of building permits and any material changes to the description of land use or development entitlements for the Property described in the Official Statement for the Bonds under the heading “MERCHANT BUILDER INFORMATION – [Lennar Homes] [Woodside] [Meritage] [D.R. Horton]” or the Periodic Report last filed in accordance with the Disclosure Certificate:

E-17
______________________________________________________________________ ______________________________________________________________________ D. Status of any land purchase contracts with regard to the Property, including sales of land in Improvement Area No. 2 to other property owners (other than individual homeowners). ______________________________________________________________________ ______________________________________________________________________ II. Legal and Financial Status of Builder
Unless such information has previously been included or incorporated by reference in a Periodic Report, describe any material change in the legal structure of the Builder or the financial condition and financing plan of the Builder that would materially and adversely interfere with its ability to complete the development plan with respect to the Property described in the Official Statement.

To the extent that the ownership of the Builder has changed, describe all material terms of the new ownership structure.
______________________________________________________________________ ______________________________________________________________________ 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 for the Property described in the Official Statement or in a previous Periodic Report. ______________________________________________________________________ ______________________________________________________________________ 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 Builder or the Property contained in the Official Statement under the heading “MERCHANT BUILDER INFORMATION – [Lennar Homes] [Woodside] [D.R. Horton]” that would materially and adversely interfere with the Builder’s ability to develop and sell the Property as described in the Official Statement.
______________________________________________________________________ ______________________________________________________________________ E-18
V. Other Material Information
In addition to any of the information expressly required above, provide such further information, if any, with respect to the Property and the Builder as may be necessary to make the specifically required statements, in the light of the circumstances under which they are made, not misleading.
_____________________________________________________________________ ______________________________________________________________________ Certification
On behalf of the Builder, the undersigned officer or authorized representative, based on actual knowledge after reasonable inquiry of employees of Builder and its affiliates, hereby certifies that this Periodic Report constitutes the Periodic Report required to be furnished by the Builder under the Disclosure Certificate.

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

BONDS, OTHER THAN STATEMENTS MADE BY THE BUILDER IN AN OFFICIAL RELEASE,

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

ACCURACY, COMPLETENESS OR FAIRNESS OF ANY SUCH UNAUTHORIZED STATEMENTS.

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

Dated:
__________________
By: _____________________________
_____________________________
_____________________________
F-1

APPENDIX F

SUMMARY OF CERTAIN PROVISIONS OF FISCAL AGENT AGREEMENT G-1

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 2023 Bonds, payment of principal, interest and other payments on the 2023 Bonds (herein, the “Securities”) to DTC Participants or Beneficial Owners, confirmation and transfer of beneficial ownership interest in the Securities 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 Securities (the “Issuer”) nor the fiscal agent appointed with respect to the Securities (the “Agent”) takes any responsibility for the information contained in this Appendix.

No assurances can be given that DTC, DTC Direct Participants or Indirect Participants will distribute to the Beneficial Owners (a) payments of interest, principal or premium, if any, with respect to the Securities, (b) certificates representing ownership interest in or other confirmation or ownership interest in the Securities, or (c) redemption or other notices sent to DTC or Cede & Co., its nominee, as the registered owner of the Securities, or that they will so do on a timely basis, or that DTC, DTC Direct 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 a wholly-owned subsidiary of The Depository Trust & Clearing Corporation (“DTCC”). DTCC is the holding G-2
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. The information contained on this Internet site is not incorporated herein by reference.

Roseville City CouncilJune 21, 2023

Roseville City Council
June 21, 2023