Attachment 4 - Preliminary Official Statement Attachment (includes the Continuing Disclosure Certificate)

PRELIMINARY OFFICIAL STATEMENT DATED _________, 2026

NEW ISSUE - BOOK-ENTRY ONLY NO RATING
In the opinion of Best Best & Krieger LLP, Riverside, California (“Bond Counsel”), subject, however, to certain qualification s described in this Official Statement, under existing statutes, regulations, rulings and judicial decisions, and assuming certain representations and compliance with certain covenants and requirements described herein, the interest on the Bonds is excluded from gross income for federal income tax purposes, and interest on the Bonds is not an item of tax p reference for purposes of calculating the federal alternative minimum tax imposed on individuals and corporations; however, interest on the Bonds is taken into account in determining the annual adjusted financial statement income of certain corporations for the purpose of computing th e alternative minimum tax imposed on certain corporations. In the further opinion of Bond Counsel, interest on the Bonds is exempt from California personal income tax. See “LEGAL MATTERS — Tax Matters” herein. $2,885,000*
COMMUNITY FACILITIES DISTRICT NO. 2022-2 (PALM)

OF THE CITY OF SAN BERNARDINO
2026 SPECIAL TAX BONDS
Dated: Date of Delivery Due: September 1, as shown on the inside front cover page The Community Facilities District No. 2022 -2 (Palm) of the City of San Bernardino 2026 Special Tax Bonds (the “Bonds”) are being issued and delivered to (i) finance the construction and acquisition of public facilities to be owned and operated by the City of San Bernardino (the “City”) with respect to the development within Community Facilities District No. 2022-2 (Palm) of the City (the “District”), County of San Bernardino (“County”), State of California (the “State”), [(ii) fund a reserve fund securing the Bonds], and (iii) pay costs of issuance of the Bonds. The District has been formed by the City.

The Bonds are authorized to be issued pursuant to the Mello -Roos Community Facilities Act of 1982, as amended (Sections 53311 et seq. of the Government Code of the State ), and pursuant to that certain Fiscal Agent Agreement, dated as of [__________], 2026 (the “Fiscal Agent Agreement”), by and between the City, for and on behalf of the District, and U.S. Bank Trust Company, National Association as fiscal agent (the “Fiscal Agent”). The Bonds are special obligations of the City and the District and are payable solely from revenues derived from certain annual Special Taxes (as d efined in this Official Statement) to be levied on and collected from the owners of certain taxable land within the District and from certain other funds pledged under the Fiscal Agent Agreement, all as further described in this Official Statement. The Special Taxes are to be levied according to the rate and method of apportionment for the District approved by the City Council of the City and the qualified electors within the District. See “SOURCES OF PAYMENT FOR THE BONDS — Special Taxes” and APPENDIX A — “RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX.” The City Council of the City is the legislative body of the District.

The Bonds are issuable in fully registered form and when issued will be registered in the name of Cede & Co., as nominee of T he Depository Trust Company, New York, New York (“DTC”). Individual purchases may be made in integral multiples of $5,000 and will be in book-entry form only. Purchasers of Bonds will not receive certificates representing their beneficial ownership of the Bonds but will receive credit balances on the books of their respective nominees.

The Bonds will not be transferable or exchangeable except for transfer to another nominee of DTC or as otherwise described in this Official Statement. Interest on the Bonds will be payable semiannually on each March 1 and September 1, commencing [September 1], 2026. Principal of and interest on the Bonds will be paid by the Fiscal Agent to DTC for subsequent disbursement to DTC p articipants who are obligated to remit such payments to the beneficial owners of the Bonds.

Additional bonds can be issued for refunding purposes only. See “THE BONDS — General Provisions,” “— Book-Entry Only System” and APPENDIX G — “INFORMATION CONCERNING DTC.”
Neither the faith and credit nor the taxing power of the City, the County, the State or any political subdivision of such entities is pledged to the payment of the Bonds. Except for the Special Tax Revenues (as defined herein), no other taxes are pledged to the payment of the Bonds. The Bonds are special obligations of the City and the District payable solely from Special Tax Revenues and certain other amounts held under the Fiscal Agent Agreement as more ful ly described in this Official Statement.

The Bonds are subject to optional redemption, mandatory redemption prior to maturity from special tax prepayments and mandato ry sinking fund redemption as described in this Official Statement. See “THE BONDS — Redemption.” Investment in the Bonds involves risks that are not appropriate for certain investors. Certain events could affect the ability of the City to pay the principal of and interest on the Bonds when due. See the section of this Official Statement entitled “RISK FACTORS” for a discussion of certain risk factors that should be considered, in addition to the other matters set forth in this Official Statement, in evaluating the investment quality of the Bonds.

This cover page contains certain information for general reference only. It is not intended to be a summary of the security or terms of this issue.

Investors are advised to read the entire Official Statement to obtain information essential to the making of an informed investment decision. ____________________

MATURITY SCHEDULE
(See Inside Cover Page)
____________________
The Bonds are offered when, as and if issued and accepted by Hilltop Securities Inc., the Underwriter, subject to approval as to their legality by Best Best & Krieger LLP, Riverside, California, Bond Counsel, and subject to certain other conditions. Certain legal matters will be passed on for the City and the District by Best Best & Krieger LLP, Riverside, California, as City Attorney and Disclosure Counsel, for the Underwriter by Kutak Rock, LLP, Irvine, California, as counsel to the Underwriter, and for the Fiscal Agent by its counsel. It is anticipated that the Bonds in book-entry form will be available for delivery to DTC on or about __________, 2026.
[UNDERWRITER LOGO]
Dated: ____________, 2026

* Preliminary, subject to change.

This Preliminary Official Statement and the information contained herein are subject to completion or amendment. These secur ities may not be sold nor may offers to buy be accepted prior to the time the Official Statement is delivered in final form. Under no circumstances shall this Preliminary Official Statement 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.

MATURITY SCHEDULE
$__________*
COMMUNITY FACILITIES DISTRICT NO. 2022-2 (PALM)

OF THE CITY OF SAN BERNARDINO
2026 SPECIAL TAX BONDS
Base CUSIP No.† _______

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

$______ _____% Term Bonds due __________ 1, 20__ Yield: _____% Price: _____ CUSIP No.† ___ $______ _____% Term Bonds due __________ 1, 20__ Yield: ____% Price: _____ CUSIP No.† ____ $______ _____% Term Bonds due __________ 1, 20__ Yield: _____% Price: ____ CUSIP No.† ___

* Preliminary, subject to change.
† CUSIP® is a registered trademark of the American Bankers Association. CUSIP data herein is provided by CUSIP Global Services, which is owned by FactSet Research Systems Inc. (“FactSet”). FactSet will manage the CUSIP system on behalf of the American Bankers Association. This information is not intended to create a database and does not serve in any way as a substitute for the CUSIP Services Bureau. CUSIP numbers have been assigned by an independent company not affiliated with the City, the District or the Underwriter and are included solely for the convenience of the registered owners of the applicable Bonds. None of the City, the District or the Underwriter is responsible for the selection or uses of these CUS IP numbers, and no representation is made as to their correctness on the applicable Bonds or as included herein. The CUSIP number for a specific maturity is subject to being changed after the issuance of the Bonds as a result of various subsequent actions including, but not limited to, a refunding in whole or in part or as a result of the procurement of secondary market portfolio insurance or other similar enhancement by investors that is applicable to al l or a portion of certain maturities of the Bonds.

CITY OF SAN BERNARDINO
San Bernardino, California

MEMBERS
Helen Tran, Mayor
Theodore Sanchez; First Ward
Sandra Ibarra; Second Ward
Juan Figueroa; Third Ward, Mayor Pro Tem
Fred Shorett; Fourth Ward
Kimberly Knaus; Fifth Ward
Mario Flores; Sixth Ward
Treasure Ortiz; Seventh Ward
STAFF
Eric Levitt, City Manager
Tarik Rahmani, Director of Finance & Management Services Telicia Lopez, City Clerk
Sonia R. Carvalho, City Attorney

SPECIAL SERVICES
Bond and Disclosure Counsel
Best Best & Krieger LLP
Riverside, California
Fiscal Agent
U.S. Bank Trust Company, National Association
Los Angeles, California
Municipal Advisor
Urban Futures, Inc.

Walnut Creek, California
Special Tax Consultant
Spicer Consulting Group, LLC
Murrieta, California

Except where otherwise indicated, all information contained in this Official Statement has been provided by the City and the District. No dealer, broker, salesperson or other person has been authorized by the City, the District, the Fis cal Agent or the Underwriter to give any information or to make any representations in connection with the offer or sale of the Bonds other than those contained in this Official Statement and, if given or made, such other information or representations must not be relied upon as having been authorized by the City, the District, the Fiscal Agent 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 Bond s by a person in any jurisdiction in which it is unlawful for such person to make such an offer, solicitation or sale.

This Official Statement , deemed final by the City and the District, is not to be construed as a contract with the purchasers or Owners of the Bonds. Statements contained in this Official Statement which involve estimates, forecasts or matters of opinion, whether or not expressly so described in this Official Statement, a re intended solely as such and are not to be construed as representations of fact. This Official Statement, including any supplement or amendment to this Official Statement, is intended to be deposited with the Electronic Municipal Market Access System of the Municipal Securities Rulemaking Board, which can be found at www.emma.msrb.org.

The information set forth in this Official Statement which has been obtained from third party sources is believed to be reliable but is not guaranteed as to accuracy or completeness by the City or the District. The information and expressions of opinion in this Official Statement are subject to change without notice, and neither the 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 or the District or any other parties described in this Official Statement since the date of this Official Statement. All summaries of the Fiscal Agent Agreement or other documents 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. Reference is made by this Official Statement to such documents on file with the City for further information. While the City maintains an Internet website for various purposes, none of the information on that website is incorporated by reference in this Official Statement or intended to assist investors in making any investment decision or to provide any continuing information with respect to the Bonds or any other bonds or obligations of the City. Any such information that is inconsistent with the information set forth in this Official Statement should be disregarded.

The Underwriter has provided the following sentence for inclusion in this Official Statement:

The Underwriter has reviewed the information in this Official Statement in accordance with, and as a part of, its 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.

Certain statements included or incorporated by reference in this Official Statement constitute “forward looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended. Such statements are generally identifiable by the terminology used such as “plan,” “expect,” “estimate,” “project,” “budget” or other similar words. Such forward -looking statements include, but are not limited to, certain statements contained in the information under the caption “THE DISTRICT.”

THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS CONTAINED IN SUCH

FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND

OTHER FACTORS WHICH MAY CAUSE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS DESCRIBED

TO BE MATERIALLY DI FFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD -LOOKING STATEMENTS. THE CITY DOES NOT PLAN TO

ISSUE ANY UPDATES OR REVISIONS TO THE FORWARD -LOOKING STATEMENTS SET FORTH IN THIS OFFICIAL STATEMENT.

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

TABLE OF CONTENTS

-i-

INTRODUCTORY .................................................................. 1 General ............................................................................... 1 The District ........................................................................ 1 Sources of Payment for the Bonds ..................................... 3 Description of the Bonds .................................................... 4 Redemption ........................................................................ 4 No Additional Bonds Except for Refunding ...................... 4 Tax Matters ........................................................................ 4 Professionals Involved in the Offering ............................... 5 Continuing Disclosure ........................................................ 5 Bond Owners’ Risks .......................................................... 5 Forward Looking Statements ............................................. 6 Other Information .............................................................. 6 THE FINANCING PLAN ........................................................ 6 Estimated Sources and Uses of Funds ................................ 7 THE BONDS ........................................................................... 7 General Provisions ............................................................. 7 Authority for Issuance ........................................................ 8 Redemption ........................................................................ 8 Registration, Transfer and Exchange ............................... 11 Book-Entry Only System ................................................. 11 Debt Service Schedule ..................................................... 12 ANNUAL DEBT SERVICE SCHEDULE ............................ 12 SOURCES OF PAYMENT FOR THE BONDS .................... 12 Limited Obligations ......................................................... 12 Special Taxes ................................................................... 13 Special Tax Fund ............................................................. 18 Bond Fund ........................................................................ 19 Reserve Fund ................................................................... 20 No Superior Obligations; No Parity Bonds
Except for Refunding ............................................. 21 THE DISTRICT ..................................................................... 21 General Description of the District .................................. 22 The Developer .................................................................. 22 The Development ............................................................. 23 Overlapping Community Facilities Districts .................... 25 Estimated Direct and Overlapping Indebtedness .............. 26 Expected Tax Burden ....................................................... 26 Estimated Value-to-Lien Ratio ......................................... 28 Delinquency History ........................................................ 31 City’s Collection Practices ............................................... 31 RISK FACTORS.................................................................... 31 Risks of Real Estate Secured Investments
Generally ................................................................ 31 Limited Obligations ......................................................... 31 Availability of Hazard Insurance ..................................... 32 Insufficiency of Special Taxes ......................................... 32 Assessed Valuations ......................................................... 33 Special Tax Delinquencies ............................................... 33 Natural Disasters, Geologic, Topographic and
Climatic Conditions ................................................ 34 Hazardous Substances ...................................................... 35 Parity Taxes and Special Assessments ............................. 36 Disclosures to Future Purchasers ..................................... 36 Depletion of Reserve Fund ............................................... 37 Non-Cash Payments of Special Taxes .............................. 37 Payment of the Special Tax Is Not a Personal
Obligation of the Owners ........................................ 37 Concentration of Ownership ............................................. 37 Land Values ...................................................................... 38 Mortgage Interest Rates .................................................... 38 Exempt Properties ............................................................ 38 Impact of Economic Conditions on the
Development in the District .................................... 39 FDIC/Federal Government Interests in Properties ............ 39 Bankruptcy and Foreclosure ............................................. 40 No Acceleration Provision ................................................ 41 Loss of Tax Exemption..................................................... 42 Limitations on Remedies .................................................. 42 Limited Secondary Market ............................................... 42 Constitutional Limitations on Taxation and
Appropriations ........................................................ 42 Voter Initiatives ................................................................ 45 IRS Audit of Tax-Exempt Bond Issues ............................ 45 Litigation with Respect to Community Facilities
Districts .................................................................. 45 Potential Early Redemption of Bonds from
Prepayments or Assessment Bond Proceeds ........... 46
Legal Requirements .......................................................... 46 Cyber Security .................................................................. 46 CONTINUING DISCLOSURE.............................................. 47 City Continuing Disclosure .............................................. 47 Developer Continuing Disclosure ..................................... 47 LEGAL MATTERS ............................................................... 48 Tax Matters....................................................................... 48 Legal Opinion ................................................................... 49 Litigation .......................................................................... 49 CONCLUDING MATTERS .................................................. 50 No Rating ......................................................................... 50 Underwriting .................................................................... 50 Municipal Advisor ............................................................ 50 Financial Interests ............................................................. 50 Additional Information ..................................................... 50

APPENDIX A - RATE AND METHOD OF
APPORTIONMENT OF SPECIAL TAX .................... A-1
APPENDIX B - APPRAISAL REPORT .............................. B-1

APPENDIX C - SUPPLEMENTAL

INFORMATION CONCERNING CITY
AND COUNTY OF SAN BERNARDINO .................. C-1

APPENDIX D - SUMMARY OF FISCAL
AGENT AGREEMENT ............................................... D-1

APPENDIX E - FORM OF CONTINUING

DISCLOSURE CERTIFICATES OF THE
CITY AND THE DEVELOPER .................................. E-1

APPENDIX F - PROPOSED FORM OF BOND
COUNSEL OPINION ................................................... F-1

APPENDIX G - INFORMATION
CONCERNING DTC ................................................... G-1

[DISTRICT LOCATION MAP]

[AERIAL PHOTO]

1 OFFICIAL STATEMENT
$2,885,000*
COMMUNITY FACILITIES DISTRICT NO. 2022-2 (PALM)

OF THE CITY OF SAN BERNARDINO
2026 SPECIAL TAX BONDS

INTRODUCTORY
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. A full review should be made of the entire Official Statement. The sale and delivery of Bonds to potential investors is made only by means of the entire Official Statement. All capitalized terms used in this Official Statement and not defined shall have the meaning set forth in APPENDIX D — “SUMMARY OF FISCAL AGENT AGREEMENT — DEFINITIONS” or APPENDIX A — “RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX.”
General
The purpose of this Official Statement (the “Official Statement ”) is to provide certain information concerning the issuance of the $2,885,000* Community Facilities District No. 2022-2 (Palm) of the City of San Bernardino 2026 Special Tax Bonds (the “Bonds”). The proceeds of the Bonds will be used to (i) finance the construction and acquisition of public facilities needed with respect to the development within Community Facilities District No. 2022-2 (Palm) of the City of San Bernardino, County of San Bernardino, State of California (the “District”), [(ii) fund a reserve fund securing the Bonds], and (iii) pay costs of issuance of the Bonds.

The Bonds are authorized to be issued pursuant to the Mello-Roos Community Facilities Act of 1982, as amended (Sections 53311 et seq. of the Government Code of the State of California (the “State”)) (the “Act”), and that certain Fiscal Agent Agreement, dated as of [__________], 2026 (the “Fiscal Agent Agreement”), by and between the City of San Bernardino (the “City”), for and on behalf of the District, and U.S. Bank Trust Company, National Association (the “Fiscal Agent”). The Bonds are secured under the Fiscal Agent Agreement by a pledge of and lien upon Special Tax Revenues (as defined in this Official Statement), subject to transfers to the Administrative Expense Fund as described herein, and all moneys deposited in the Bond Fund and the Reserve Fund.

The District
The District contains approximately 14.70 acres, located in the City, north of E. Highland Avenue and west of N. Palm Avenue . The District is planned for 133 single family residential homes at buildout in a neighborhood being marketed as “Summit Park” (the “Project”). Richmond American Homes of Maryland, Inc. (“Developer”) is actively developing the Project into two product lines, “Aurora” and “Paloma.” As of the April 15, 2026, date of value (the “Date of Value”) of the Appraisal Report (as defined below), 61 of the 133 planned single family residential homes had been completed and conveyed to individual homeowners. Of the remaining 72 residential lots owned by the Developer, 67 were completed homes, including 6 model homes (not released for sale) , and 5 were under construction. As of June 1, 2026, an additional [__] homes closed escrow to individual homeowners, resulting in [__] homes conveyed to individual homeowners. As of June 1, 2026, of the remaining [__] residential lots owned by Developer, [__] were completed homes ([__] of which were in escrow but not yet closed) , including 3 model homes (not released for sale), and [__] were under construction. Homes under contract may not result in closed escrows as sales contracts are subject to cancellation by the homebuyers.

* Preliminary, subject to change.

2 The Developer has obtained building permits for all 133 residential lots within the District . The Developer expects to complete home construction by October 2026 and expects to close escrow on the remaining homes by June 2027.

Formation Proceedings. The District was formed by the City pursuant to the Act. The Act was enacted by the California legislature to provide an alternative method of financing certain public capital facilities and services, especially in developing areas of the State of Cali fornia (the “State”). Any local agency (as defined in the Act) may establish a community facilities district under the Act to provide for and finance the cost of eligible public facilities and services. Generally, the legislative bod y of the local agency which forms a district acts on behalf of such district as its legislative body. Subject to approval by two -thirds of the votes cast at an election and compliance with the other provisions of the Act, a legislative body of a local age ncy may issue bonds for a district and may levy and collect a special tax within such district to repay such indebtedness.

Pursuant to the Act, the City Council of the City (the “City Council”), acting as the legislative body of the District, adopted the necessary resolutions stating its intent to establish the District, to authorize the levy of Special Taxes (defined below) on taxable property within the boundaries of the District, and to have the District incur bonded indebtedness to fund the acquisition, design, construction of local and regional circulation systems, storm drain improvement, and parkland and open space (the “City Facilities ”). Following public hearings conducted pursuant to the provisions of the Act, the City Council adopted resolutions establishing the District and calling special elections to submit the levy of the special taxes and the incurring of bonded indebtedness to t he qualified voters of the District. On October 5, 2022, at a special election held pursuant to the Act, the qualified voters of the District authorized the District to incur bonded indebtedness within the District in an aggregate principal amount not to exceed $4,000,000 and the levy of Special Taxes (as defined below) to repay such bonded indebtedness in accordance with the Rate and Method of Apportionment for the District (the “Rate and Method”).

The Rate and Method is attached hereto as APPENDIX A.

The Assigned Special Tax (as defined in the Rate and Method) is the special tax that will be levied to pay debt service on the Bonds. The Assigned Special Tax is referred to in this Official Statement as the “Special Tax” or the “Special Taxes.”
Assessed Value. Six homes in the District , three of which have been conveyed to homeowners, were assessed for complete improvement value by the County Assessor in Fiscal Year 2025-26. As of April 15, 2026, the aggregate, or cumulative, assessed values in the District were $ 3,128,772. See APPENDIX B – “THE APPRAISAL REPORT.”
Appraisal Report. In order to provide information with respect to the remaining 127 parcels within the District, the District has obtained an appraisal of the Taxable Property (as defined herein) included in the District (the “Appraisal” or “Appraisal Report”) with a dat e of value as of April 15, 2026 (the “Date of Value”). The Appraisal was prepared for the District by Integra Realty Resources, Inc. (the “Appraiser”). The Appraisal Report appraises 127 lots within the District, consisting of 56 completed homes which have been conveyed to individual homeowners, 66 completed but unsold homes, and 5 homes under construction . Not appraised in the Appraisal Report were 6 parcels that for Fiscal Year 2025-26 were assessed for complete improvement value by the County Assessor.

Subject to the limitations set forth in the Appraisal, the Appraiser was of the opinion that, as of the Date of Value, the aggregate value of taxable property in the District was no less than $66,487,772, which consists of $3,128,772 Fiscal Year 2025-26 assessed value of 6 parcels, and $63,359,000 appraised value of the 127 appraised taxable parcels. See “THE COMMUNITY FACILITIES DISTRICT — Property Values” and “THE COMMUNITY FACILITIES DISTRICT — Value-to-Lien Ratios.” See “THE DISTRICT — Appraisal Report,” APPENDIX B — “APPRAISAL REPORT” and “RISK FACTORS — Parity Taxes and Special Assessments.”

3 Sources of Payment for the Bonds
Special Taxes. The Special Tax is that tax which has been authorized to be levied against certain land within the District pursuant to the Act and in accordance with the Rate and Met hod to satisfy the Special Tax Requirement (as defined in the Rate and Method). “Special Tax Revenues ” are defined in the Fiscal Agent Agreement to mean the proceeds of the Special Taxes received by the City, including any scheduled payments, interest and penalties thereon and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes in the amount of said lien and interest and penalties thereon . See “SOURCES OF PAYMENT FOR THE BONDS — Special Taxes ” and APPENDIX A — “RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX.” Under the Fiscal Agent Agreement, the District has pledged to repay the Bonds from the Special Tax Revenues (subject to the deposit of certain amounts in the Administrative Expense Fund for each Fiscal Year) and amounts on deposit in the Bond Fund and the Reserve Fund established under the Fiscal Agent Agreement.

Reserve Fund. The Fiscal Agent Agreement establishes a Reserve Fund for the Bonds to be maintained at the Reserve Requirement. The Fiscal Agent Agreement provides that the Reserve Requirement shall, as of the date of calculation, equal the lesser of (i) ten percent (10%) of the original issue price of the Bonds calculated in accordance with Treasury Regulations Section 1.148 -2(f)(1), (ii) Maximum Annual Debt S ervice on the Bonds or (iii) one hundred twenty -five percent (125%) of average Annual Debt Servic e on the Bonds (the “Reserve Requirement”). The initial Reserve Requirement for the Bonds is an amount equal to $[_______]. The ability of the City Council to increase the annual Special Taxes levied in the District to replenish the Reserve Fund is subject to the maximum annual amounts of Special Taxes authorized for the District and certain limitations in the Act.

The moneys in the Reserve Fund will be used only for payment of the principal of, and interest and any redemption premium on, the Bonds, and, at the direction of the City, for deposit in the Rebate Fund. See “SOURCES OF PAYMENT FOR THE BONDS — Reserve Fund.”
The Special Tax Revenues are the primary security for the repayment of the Bonds. In the event that the Special Taxes are not paid when due, the only sources of funds available to pay the debt service on the Bonds are amounts held by the Fiscal Agent in the Bond Fund and the Reserve Fund, to the limited extent described in the Fiscal Agent Agreement. See “SOURCES OF PAYMENT FOR THE BONDS — Reserve Fund.” Foreclosure Proceeds. The City will covenant in the Fiscal Agent Agreement, for the benefit of the owners of the Bonds, that it will order, and cause to be commenced, judicial foreclosure proceedings against properties in the District with delinquent Special Taxes in excess of $5,000 by October 1 following the close of the Fiscal Year in which such Special Taxes were due, and if the amount on deposit in the Reserve Fund is less than the Reserve Requirement, it will commence judicial foreclosure proceedings against all properties in the District with delinquent Special Taxes by October 1 following the close of each Fiscal Year in which it receives Special Taxes in an amount which is less than 95% of the total Special Taxes levied, and diligently pursue to completion such foreclosure proceedings. See “SOURCES OF PAYMENT FOR THE BONDS — Special Taxes — Proceeds of Foreclosure Sales.”
There is no assurance that the property in the District can be sold for the appraised value or assessed values described in this Official Statement, or for a price sufficient to pay the principal of and interest on the Bonds in the event of a default in payment of Special Taxes by the current or future propert y owners within the District. See “RISK FACTORS — Land Values” and APPENDIX B — “APPRAISAL REPORT.”

EXCEPT FOR THE SPECIAL TAXES, NO OTHER TAXES ARE PLEDGED TO THE PAYMENT OF THE BONDS. THE BONDS ARE NOT GENERAL OBLIGATIONS OF THE CITY OR THE DISTRICT,

BUT ARE SPECIAL OBLIGATIONS OF THE CITY AND THE DISTRICT PAYABLE SOLELY FROM

SPECIAL TAX REVENUES AND AMOUNTS HELD UNDER THE FISCAL AGENT AGREEMENT AS MORE FULLY DESCRIBED IN THIS OFFICIAL STATEMENT.

4 No Superior Obligations; No Parity Bonds Except for Refunding . The District and the City covenant in the Fiscal Agent Agreement that they will not issue any other obligations payable, as to principal or interest, from the Special Tax Revenues which have, or purport to have, any lien upon the Special Tax Revenues superior to or on a parity with the lien of the Bonds, except with respect to the redemption prior to maturity of any Bonds subject to call and redemption and payment of said Bonds from proceeds of refunding bonds issued under the Act as the same now exists or as hereafter amended, or under any other law of the State, which shall be payable from and have a lien upon the Special Tax Revenues on a parity with the Bonds to be outstanding following the issuance of such refunding bonds. See “SOURCES OF PAYMENT FOR THE BONDS — No Superior Obligations; No Parity Bonds Except for Refunding.”
Description of the Bonds
The Bonds will be issued and delivered in the form of a single, fully registered Bonds for each maturity, registered in the name of The Depository Trust Company, New York, New York and its successors and assigns, as nominee (“DTC”), and will be available to actual purchasers of the Bonds (the “Beneficial Owners”) in integral multiples of $5,000, under the book-entry system maintained by DTC, only through brokers and dealers who are or act through DTC Participants. Beneficial Owners will not be entitled to receive physical delivery of the Bonds.

In the event that the book-entry only system described in this Official Statement is no longer used with respect to the Bonds, the Bonds will be registered and transferred in accordance with the Fiscal Agent Agreeme nt. See APPENDIX G — “INFORMATION CONCERNING DTC.”
Principal of, premium, if any, and interest on the Bonds is payable by the Fiscal Agent to DTC, as the registered Owner of the Bonds. Disbursement of such payments to DTC Participants is the responsibility of DTC and disbursement of such payments to the B eneficial Owners is the responsibility of DTC Participants. In the event that the book -entry only system is no longer used with respect to the Bonds, principal, interest and redemption premium, if any, shall be paid to the registered Owner thereof in acco rdance with the Fiscal Agent Agreement. See “THE BONDS — Book-Entry Only System ” and see APPENDIX G — “INFORMATION CONCERNING DTC.”
Redemption
The Bonds are subject to optional redemption, mandatory redemption prior to maturity from special tax prepayments and mandatory sinking fund redemption as described in this Official Statement. For a more complete description of the Bonds and the documentation pursuant to which they are being sold and delivered, see “THE BONDS” and APPENDIX D — “SUMMARY OF FISCAL AGENT AGREEMENT.” No Additional Bonds Except for Refunding
The maximum bond authorization within the District is $4,000,000. Following the issuance of the Bonds, no additional bonds can be issued on a parity basis with the Bonds, with the exception of refunding bonds.

Tax Matters
In the opinion of Bond Counsel, based on an analysis of existing laws, regulations, rulings and court decisions, and assuming, among other matters, compliance with certain covenants, interest on the Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986 and is exempt from S tate of California personal income taxes. In the further opinion of Bond Counsel, interest on the Bonds is not a specific preference item for purposes of federal alterna tive minimum tax imposed on individuals and corporations, although Bond Counsel observes that such interest is included in annual adjusted financial statement income of certain corporations for the purpose of computing the alternative minimum tax imposed on certain corporations. Bond Counsel expresses no opinion regarding any other federal or state income tax consequences relating to the ownership or disposition of, or the accrual or receipt of interest on, the Bonds.

Set forth in Appendix F is the proposed form of opinion of Bond Counsel expected to be delivered in connection

5 with the issuance of the Bonds. For a more complete discussion of such opinion and certain other tax consequences incident to the ownership of the Bonds, including certain exceptions to the tax treatment of interest, see “LEGAL MATTERS — Tax Matters.”
Professionals Involved in the Offering
U.S. Bank Trust Company, National Association will act as Fiscal Agent under the Fiscal Agent Agreement. Hilltop Securities, Inc. is the Underwriter of the Bonds. Certain proceedings in connection with the issuance and delivery of the Bonds are subject to the approval of Best Best & Krieger LLP, Riverside, California (“Bond Counsel”). Certain legal matters will be passed on for the City and the District by Best Best & Krieger LLP, Riverside, California , as the City Attorney and disclosure counsel (“Disclosure Counsel ”), and fo r the Underwriter by Kutak Rock, LLP, Irvine, California as Underwriter’s Counsel. Other professional services have been performed by Spicer Consulting Group, LLC, Murrieta, California, as Special Tax Consultant, Urban Futures, Inc., Walnut Creek, California, as Municipal Advisor and Integra Realty Resources, Inc., Los Angeles, California, as Appraiser. From time to time, Bond Counsel and Disclosure Counsel represent the Underwriter in matters unrelated to the Bonds.

For information concerning the respects in which certain of the above-mentioned professionals, advisors, counsel and agents may have a financial or other interest in the offering of the Bonds, see “LEGAL MATTERS — Financial Interests.”
Continuing Disclosure
Pursuant to a Continuing Disclosure Certificate to be executed by the City (the “City Continuing Disclosure Certificate ”), the City will agree to provide, or cause to be provided, on an annual basis, to the Electronic Municipal Market Access System of the Municipal Securities Rulemaking Board (the “MSRB”), which can be found at www.emma.msrb.org (“EMMA”), certain financial information and operating data. The City will further agree to provide notice to EMMA of certain enumerated events. These covenants are being made in order to assist the Underwri ter in complying with Rule 15c2 -12(b)(5) (the “Rule”) adopted by the Securities and Exchange Commission (the “SEC”).

Although the Underwriter does not consider the Developer to be obligated parties under the Rule, the Developer will agree to provide or cause to be provided to EMMA, pursuant to a Continuing Disclosure Certificate to be executed by the Developer (the “ Developer Continuing Disclosure Certificate”), certain semi -annual information with respect to itself and its development within the District and notice of certain listed events to assist the Underwriter in marketing the Bonds. The Developer’s obligations unde r the Developer Continuing Disclosure Certificate will terminat e upon the earliest to occur of (a) the legal defeasance, prior redemption or payment in full of all of the Bonds, or (b) the date on which the Developer owns all or a portion of the p roperty in the District that represents less than 20% of the aggregate Special Tax obligation.

See “CONTINUING DISCLOSURE” and APPENDIX E for a description of the specific nature of the annual reports and notices of listed events to be filed by the City, on behalf of the District, under the City Continuing Disclosure Certificate, and semi -annual reports and notices of listed events to be provided by the Developer under the Developer Continuing Disclosure Certificate.

Bond Owners’ Risks
Certain events could affect the timely repayment of the principal of and interest on the Bonds when due.

See the section of this Official Statement entitled “RISK FACTORS” for a discussion of certain factors which should be considered, in addition to other matters set forth in this Official Statement, in evaluating an investment in the Bonds. The Bonds are not rated by any nationally recognized rating agency.

6 Forward Looking Statements
Certain statements included or incorporated by reference in this Official Statement constitute “forward- looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended. Such statemen ts are generally identifiable by the terminology used such as “plan,” “expect,” “estimate,” “project,” “budget” or other similar words. Such forward-looking statements include, but are not limited to, certain statements contained in the information under the caption “THE DISTRICT.”

THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS CONTAINED IN

SUCH FORWARD -LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS,

UNCERTAINTIES AND OTHER FACTORS WHICH MAY CAUSE ACTUAL RESULTS, PERFORMANCE

OR ACHIEVEMENTS DESCRIBED TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS,

PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD -LOOKING STATEMENTS. THE DISTRICT DOES NOT PLAN TO ISSUE ANY UPDATES OR REVISIONS TO THE FORWARD-LOOKING STATEMENTS SET FORTH IN THIS OFFICIAL STATEMENT.

Other Information
This Official Statement speaks only as of its date, and the information contained in this Official Statement is subject to change.

Brief descriptions of the Bonds and the Fiscal Agent Agreement are included in this Official Statement.

Such descriptions and information do not purport to be comprehensive or definitive. All references to the Fiscal Agent Agreement, the Bonds , and the constitution and laws of the State as well as the proceedings of the City Council, acting as the legislative body of the District, are qualified in their entirety by references to such documents, laws and proceedings, and with respect to the Bonds, by reference to the Fiscal Agent Agreement.

Copies of the Fiscal Agent Agreement, the City Continuing Disclosure Certificate and other documents and information referred to in this Official Statement are available for inspection and (upon request and payment to the City of a charge for copying, mailing and handling) for delivery from the City at 290 North “D” Street, San Bernardino, CA 92401, Attention: City Manager.

THE FINANCING PLAN
A portion of the Bond proceeds will be used by the District to design, construct and/or acquire cer tain authorized City Facilities. See “THE DISTRICT — Description of Authorized Facilities” for a description of the public facilities authorized to be financed with the proceeds of the Bonds.

7 Estimated Sources and Uses of Funds
The following table sets forth the expected sources and uses of Bond proceeds:

Sources of Funds
Principal Amount of Bonds $
[Plus] [Net] Original Issue Premium
Total Sources $

Uses of Funds
Improvement Fund $
Reserve Fund
Costs of Issuance Fund(1)
Underwriter’s Discount
Total Uses $

(1) Costs of Issuance include legal fees, printing costs, Appraisal Report costs, Municipal Advisor fees, Special Tax Consultant fees, and Fiscal Agent fees, in addition to other miscellaneous costs incidental to Bond issuance.

THE BONDS
General Provisions
The Bonds will be dated their date of delivery and will bear interest at the rates per annum set forth on the inside cover page, payable semiannually on each March 1 and September 1, commencing on September 1, 2026 (each, an “Interest Payment Date”), and will mature in the amounts and on the dates set forth on the inside cover page of this Official Statement. The Bonds will be issued in fully registered form in integral multiples of $5,000. See “— Book-Entry Only System.”
Interest shall be calculated on the basis of a 360-day year composed of twelve 30 day months. Each Bond shall bear interest from the Interest Payment Date next preceding the date of authentication thereof unless (i) it is authenticated on an Interest Payment Date, in which event it shall bear interest from such Interest Payment Date, 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 of the Bonds; provided, however, that if at the time of authentication of a Bond, interest is in default thereon, such Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon or from the closing date of the Bonds, if no interest has previously been paid or made available for payment thereon.

Interest on the Bonds is payable by check of the Fiscal Agent mailed by first class mail, postage prepaid, on each Interest Payment Date, 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. The principal of the Bonds and any premium on the Bonds are payable in lawful money of the United States of America by check of the Fiscal Agent upon surrender of such Bonds at the Principal Office of the Fiscal Agent; provided, however, that at the written request of the Owner of at least $1,000,000 in aggregate principal amount of Outstanding Bonds filed with the Fiscal Agent prior to any Record Date, int erest on such Bonds shall be paid to such Owner on each succeeding Interest Payment Date by wire transfer of immediately available funds to an account in the United States of America designated in such written request.

8 Authority for Issuance
The Bonds are issued pursuant to the Act and the Fiscal Agent Agreement. As required by the Act, the City Council has taken the following actions with respect to establishing the District and the Bonds:

Resolutions of Intention and Resolution of Necessity . On July 20, 2022 , the City Council adopted a resolution stating its intention to establish the District and to authorize the levy of a special tax therein (“Resolution of Intention”), and a resolution declaring the necessity to have the District incur bonded indebtedness in an amount not to exceed $ 4,000,000. On August 17, 2022, the City Council adopted a resolution amending and supplementing the Resolution of Intention to amend the date of the public hearing from September 7, 2022 to October 5, 2022.

Resolutions of Formation. Following a noticed public hearing conducted on October 5, 2022, the City Council adopted on October 5, 2022, resolutions which established the District, authorized the levy of a special tax within the District, and determined the necessity for the District to incur bonded indebtedness in a maximum aggregate principal amount of $4,000,000.

Resolution Calling Election . The resolutions adopted by the City Council on October 5, 2022 , also included resolutions that called for special elections by the landowners in the District on the issues of the levy of the Special Tax, the incurring of bonded indebtedness within the District, and the establishment of an appropriations limit.

Landowner Election and Declaration of Results. On October 5, 2022, an election was held at which the landowners within the District approved ballot propositions authorizing the levy of special taxes, the issuance of up to $4,000,000 of bonds to finance the City Facilities, and the establishment of an appropriations limit for the District. On October 5, 2022 , the City Council adopted a resolution approving the canvass of the votes and declaring the District to be fully formed with the authority to levy the Special Taxes, to incur the bonded indebtedness, and to have the established appropriations limit.

Special Tax Lien and Levy. The Notice of Special Tax Lien for the District was recorded in the Office of the County Recorder on October 7, 2022 as Document No. 2022-0336650 reflecting a continuing lien against the taxable property within the District (the “Notice of Special Tax Lien”).

Ordinance Levying Special Taxes. On November 2, 2022, the City Council adopted Ordinance No. MC- 1598 (the “Ordinance”), which authorized the levy of Special Taxes within the District.

Resolution Authorizing Issuance of the Bonds . On June [__] , 2026, the City Council adopted a resolution approving issuance of the Bonds.

Redemption
Optional Redemption. The Bonds are subject to redemption prior to their stated maturity dates at the option of the City on September 1, 20__, or any date thereafter, from such maturities as selected by the City (and by lot within any one maturity), in integral multiples of $5,000, at the option of the City from moneys derived by the City from any source, at a redemption price (expressed as a percentage of t he principal amount of the Bonds to be redeemed), together with accrued interest to the date of redemption, as follows:

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

9 Mandatory Redemption From Special Tax Prepayments . The Bonds are subject to mandatory redemption prior to their stated maturity dates on any Interest Payment Date, as selected among maturities by the City (and by lot within any one maturity), in integral multiples of $5,000, from moneys derived by the City from Special Tax Prepayments, at redemption prices (expressed as percentages of the principal amounts of the Bonds to be redeemed), together with accrued interest to the date of redemption, as follows:

Redemption Dates Redemption Prices
Any Interest Payment Date through September 1, 20[__] 103% March 1, 20__ and September 1, 20__ 102
March 1, 20__ and September 1, 20__ 101
March 1, 20__ and any Interest Payment Date thereafter 100

See the caption “RISK FACTORS —Potential Early Redemption of Bonds from Prepayments or Assessment Bond Proceeds” for a discussion of the potential for a lower than expected yield on the Bonds as a result of a special mandatory redemption from prepayment of Special Taxes.

Mandatory Sinking Fund Redemption . The Outstanding Bonds maturing on September 1, 20 __, September 1, 20 __ and September 1, 20 __ are subject to mandatory sinking fund redemption, in part, on September 1, 20__, September 1, 20__ and September 1, 20__, respectively and on each September 1 thereafter to maturity, by lot, at a redemption price equal to the principal amount thereof to be redeemed, together with accrued interest to the date of redemption, without premium, and from sinking payments as follows:

Bonds Maturing on September 1, 20__
Redemption Date
(September 1) Sinking Payments

†
† Maturity.

Bonds Maturing on September 1, 20__
Redemption Date
(September 1) Sinking Payments

†
† Maturity.

10 Bonds Maturing on September 1, 20__
Redemption Date
(September 1) Sinking Payments

†
† Maturity.

The amounts in the foregoing schedules shall be reduced by the City pro rata among redemption dates, in order to maintain substantially level Debt Service, as a result of any prior or partial o ptional or mandatory redemption. The City shall provide the Fiscal Agent with a revised sinking fund schedule.

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

Notice to Fiscal Agent. An Authorized Officer shall give the Fiscal Agent written notice of the City ’s intention to redeem Bonds not less than 45 days prior to the applicable redemption date specifying the principal amounts and maturities of the Bonds to be redeemed. The requirement to provide such notice to the Fiscal Agent shall not apply to mandatory sinking fund redemption of the Bonds.

Redemption Procedure by Fiscal Agent . The Fiscal Agent shall cause notice of any redemption to be mailed by first class mail, postage prepaid, at least 30 days but not more than 60 days prior to the date fixed for redemption, or electronically submitted, to the Securities Depositories and t o one or more Information Services selected by an Authorized Officer, and to the respective registered Owners of any Bonds designated for redemption, at their addresses appearing on the Bond registration books maintained by the Fiscal Agent at its Principal Office; 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 redempti on of such Bonds. The Fiscal Agent shall also cause notice of any redemption to be mailed, in such manner and within such time, to the Underwriter.

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

Any notice of optional redemption of the Bonds delivered in accordance with the Fiscal Agent Agreement may be conditional and if any condition stated in the notice of redemption shall not have been satisfied on or prior to the redemption date, said notice shall be of no force and effect and the District shall not be required to redeem such Bonds and the redemption shall not be made and the Fiscal Agent shall within a reasonable time thereafter

11 give notice, to the persons and in the manner in which the notice of redemption was given, that such condition or conditions were not met and that the redemption was cancelled.

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

In the event of a mandatory redemption pursuant to the Fiscal Agent Agreement, the City shall transfer or cause to be transferred to the Fiscal Agent for deposit in the Bond Fund moneys in an amount equal to the redemption price of the Bonds being redeemed on or before the 15th day of the month preceding the Interest Payment Date upon which such Bonds are to be redeemed.

If less than all the Bonds Outstanding are to be redeemed, the portion of any Bond of a denomination of more than $5,000 to be redeemed shall be in the principal amount of $5,000 or a multiple thereof, and, in selecting portions of such Bonds for redemption, the Fiscal Agent shall treat each such Bond as representing the number of Bonds of $5,000 denomination which is obtained by dividing the principal amount of such Bond to be redeemed in part by $5,000.

Whenever provision is made in the Fiscal Agent Agreement for the redemption of less than all of the Bonds of a maturity or any given portion thereof, the Fiscal Agent shall select the Bonds of such maturity to be redeemed, from all Bonds of such maturity or such given portion thereof not previously called for redemption, by lot within a maturity in any manner which the Fiscal Agent in its sole discretion shall deem appropriate.

Upon surrender of Bonds redeemed in part only, the City shall execute and the Fiscal Agent shall authenticate and deliver to the Owner, at the expense of the District, a new Bond or Bonds, of the same maturity, of authorized denominations in aggregate principal amount equal to the unredeemed portion of the Bond or Bonds.

Effect of Redemption. From and after the date fixed for redemption, if funds available for the payment of the redemption prices of the Bonds called for redemption shall have been deposited in the Bond Fund, such Bonds shall cease to be entitled to any benefit under the Fisca l Agent Agreement other than the right to receive payment of the redemption price, and interest shall cease to accrue on the Bonds to be redeemed on the redemption date specified in the notice of redemption.

All Bonds redeemed and purchased by the Fiscal Agent pursuant to the Fiscal Agent Agreement shall be cancelled by the Fiscal Agent.

Registration, Transfer and Exchange
Registration. The Fiscal Agent will keep sufficient books for the registration and transfer of the Bonds.

The ownership of the Bonds will be established by the Bond registration books held by the Fiscal Agent.

Transfer or Exchange. Whenever any Bond is surrendered for registration of transfer or exchange, the Fiscal Agent will authenticate and deliver a new Bond or Bonds of the same maturity, for a like aggregate principal amount of authorized denominations; provided that the Fisc al Agent will not be required to register transfers or make exchanges of (i) Bonds for a period of 15 days next preceding the date established by the Fiscal Agent for selection of Bonds for redemption or (ii) with respect to Bonds selected for redemption.

Book-Entry Only System
The Bonds will be issued in book -entry form, and The Depository Trust Company of New York, New York will act as securities depository. So long as the Bonds are held in book-entry form, principal of, premium, if any, and interest on the Bonds will be paid by the Fiscal Agent directly to DTC for distribution to the beneficial owners of the Bonds in accordance with procedures adopted by DTC. See APPENDIX G — “INFORMATION CONCERNING DTC.”

12 Debt Service Schedule
The following table presents the annual debt service on the Bonds (including sinking fund redemptions), assuming there are no optional redemptions or mandatory redemptions from Special Tax Prepayments pursuant to the Rate and Method. See “SOURCES OF PAYMENT FOR THE BONDS — Special Taxes” and “THE BONDS — Redemption.”

ANNUAL DEBT SERVICE SCHEDULE
Bond Year Ending
September 1 Principal Interest
Total Annual
Debt Service
2026 $ $ $
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
2054
2055
2056
Total $ $ $

Source: Underwriter.

SOURCES OF PAYMENT FOR THE BONDS
Limited Obligations
The Bonds are special, limited obligations of the City and the District payable only from amounts pledged under the Fiscal Agent Agreement and from no other sources.

13 The Special Tax Revenues are the primary security for the repayment of the Bonds. Under the Fiscal Agent Agreement, the City and the District have pledged to repay the Bonds from the Special Tax Revenues (which are the proceeds of the Special Taxes receiv ed by the City, including any scheduled payments, interest and penalties thereon and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes in the amount of said lien and interest and penalties thereon), subject to the deposit of certain amounts in the Administrative Ex pense Fund for each Fiscal Year, and all moneys deposited in the Bond Fund and the Reserve Fund.

In the event that the Special Tax Revenues are not received when due, the only sources of funds available to pay the debt service on the Bonds are amounts held by the Fiscal Agent in the Bond Fund and the Reserve Fund for the exclusive benefit of the Owners of the Bonds.

Neither the faith and credit nor the taxing power of the City, the County, the State or any political subdivision thereof is pledged to the payment of the Bonds. Except for the Special Tax Revenues, no other taxes are pledged to the payment of the Bonds. The Bonds are not general obligations of the City or the District, but a re special obligations of the City and the District payable solely from Special Taxes and amounts held under the Fiscal Agent Agreement as more fully described in this Official Statement.

Special Taxes
Authorization and Pledge. In accordance with the provisions of the Act, the City Council established the District on October 5, 2022 , for the purpose of financing the City Facilities . At a special election held on October 5, 2022, the qualified electors authorized the District to incur indebtedness in an amount not to exceed $4,000,000 and approved the Rate and Method which authorizes the Special Tax to be levied to repay District indebtedness, including the Bonds. On November 2, 2022, the Board adopted Ordinance No. MC-1598, which authorized the levy of Special Taxes in the District.

The District will covenant in the Fiscal Agent Agreement that each year it will levy Special Taxes up to the maximum rates permitted under the Rate and Method in an amount sufficient, together with other amounts on deposit in the Special Tax Fund, to pay t he principal of and interest on any Outstanding Bonds, to replenish the Reserve Fund and to pay the estimated Administrative Expenses. Notwithstanding the foregoing, pursuant to Section 53321(d) of the Act, under no circumstances will the Special Taxes levied against any Assessor’s Parcel used as a private residence be increased as a consequence of delinquency or default by the owner of any other Assessor’s Parcel or Assessor’s Parcels within the District by more than 10%.

The Special Taxes levied in any Fiscal Year may not exceed the maximum rates authorized pursuant to the Rate and Method. See APPENDIX A — “RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX.” There is no assurance that the Special Tax proceeds will, in all circumstances, be adequate to pay the principal of and interest on the Bonds when due. See “RISK FACTORS — Insufficiency of Special Taxes.” Rate and Method of Apportionment of Special Tax. All capitalized terms used in this section shall have the meaning set forth in APPENDIX A — “RATE AND METHOD O F APPORTIONMENT OF SPECIAL TAX.”
Under the Rate and Method, each Fiscal Year, each Assessor’s Parcel in the District will be classified as Taxable Property or Exempt Property. In addition, each Assessor ’s Parcel of Taxable Property will be further classified as Developed Property, Approved Property, Undeveloped Property or Provisional Undeveloped Property. Assessor’s Parcels of Developed Property shall further be classified as Residential Property or Non - Residential Property. Each Assessor’s Parcel of Residential Property shall further be classified as a Single Family Residential Property or Multifamily Property. Each Assessor’s Parcel of Single Family Residential Property shall be further assigned to a Land Use Category based on its Building Square Footage.

14 The Maximum Special Tax for each Assessor’s Parcel of Single Family Residential Property in any Fiscal Year shall be the greater of (a) the Assigned Special Tax or (b) the Backup Special Tax. The Maximum Special Tax for each Assessor ’s Parcel of Non -Residential Property and Multifamily Residential Property shall be the applicable Assigned Special Tax described in the Rate and Method.

Each Fiscal Year, each Assessor’s Parcel of Single Family Residential Property, Multifamily Property or Non-Residential Property shall be subject to an Assigned Special Tax. In some instances an Assessor’s Parcel of Developed Property may contain more than one Land Use Type. The Maximum Special Tax levied on an Assessor’s Parcel shall be the sum of the Maximum Special Tax for each Taxable Unit for each Unit for all Land Use Categories located on the Assessor’s Parcel.

The Backup Special Tax for an Assessor’s Parcel within a Final Map classified or to be classified as Single Family Property shall be as calculated per the Rate and Method. In the event any portion of the Final Map is changed or modified, the Backup Special Tax for all Assessor’s Parcels within such changed or modified area shall be $27,459 per Acre. The Backup Special Tax shall not apply to Multifamily Residential Property or Non‐ Residential Property.

The Maximum Special Tax for each Assessor’s Parcel of Approved Property expected to be classified as Single Family Property shall be the Backup Special Tax computed pursuant to the Rate and Method . The Maximum Special Tax for each Assessor’s Parcel of Approved Property expected to be classified as Multifamily Residential Property or Non‐Residential Property shall be $27,459 per Acre.

The Maximum Special Tax for each Assessor’s Parcel of Undeveloped Property and Provisional Undeveloped Property that is not Exempt Property shall be $27,459 per Acre.

Commencing Fiscal Year 2022-23 and for each subsequent Fiscal Year, the City Council has levied, and will continue to levy, Special Taxes on all Taxable Property in accordance with the following steps:

Step One: The Special Tax shall be levied Proportionately on each Assessor’s Parcel of Developed Property at up to 100% of the applicable Assigned Special Tax rates in the Rate and Method to satisfy the Special Tax Requirement.

Step Two: If additional moneys are needed to satisfy the Special Tax Requirement after the first step has been completed, the Special Tax shall be levied Proportionately on each Assessor’s Parcel of Approved Property at up to 100% of the Maximum Special Tax applica ble to each such Assessor’s Parcel as needed to satisfy the Special Tax Requirement.

Step Three: If additional moneys are needed to satisfy the Special Tax Requirement after the first two steps have been completed, the Annual Special Tax shall be levied Proportionately on each Assessor’s Parcel of Undeveloped Property up to 100% of the Maximum Specia l Tax applicable to each such Assessor’s Parcel as needed to satisfy the Special Tax Requirement.

Step Four: If additional moneys are needed to satisfy the Special Tax Requirement after the first three steps have been completed, then t he Special Tax on each Assessor’ s Parcel of Developed Property whose Maximum Special Tax is the Backup Special Tax shall be increased in equal percentages from the Assigned Special Tax up to 100% of the Backup Special Tax as needed to satisfy the Special Tax Requirement.

Step Five: If additional moneys are needed to satisfy the Special Tax Requirement after the first four steps have been completed, the Special Tax shall be levied Proportionately on each Assessor’s Parcel of Provisional Undeveloped Property up to 100% of the Maximum Special Tax applicable to each such Assessor’s Parcel as needed to satisfy the Special Tax Requirement.

Notwithstanding the above, the City Council shall not classify an Assessor’s Parcel as Exempt Property if such classification would reduce the sum of all Taxable Property to less than 9.11 Acres. Assessor’s Parcels

15 which cannot be classified as Exempt Property because such classification would reduce the Acreage of all Taxable Property to less than 9.11 Acres will be classified as Provisional Undeveloped Property, and will be subject to Special Tax pursuant to Step Five above.

Pursuant to the Rate and Method, “Special Tax Requirement” means the amount required in any Fiscal Year to pay: (i) the debt service or the periodic costs on all outstanding Bonds due in the Calendar Year that commences in such Fiscal Year, (ii) Administrative Expenses, (iii) the costs associated with the release of funds from an escrow account, (iv) any amount required to establish or replenish any reserve funds established under the Fiscal Agent Agreement in association with the Bonds to the extent that replenishment has not been included in the computation of the Special Tax Requirement in a previous Fiscal Year, (v) to cure any delinquencies in the amount of principal or interest on the Bonds that occurred in a previous Fiscal Year , and (vi) the collection or accumulation of funds for the acquisition or construction of facilities authorized by the District provided that the inclusion of such amount does not cause an increase in the levy of Special Tax on Undeveloped Propert y as set forth in Step Three above, less (vii) any amounts available to pay debt service or other periodic costs on the Bonds pursuant to the Fiscal Agent Agreement.

Pursuant to Section 53321(d) of the Act, notwithstanding the above, under no circumstances will the Special Tax levied against any taxable parcel of private residential property within the District be increased by more than 10% as a consequence of a delinquency or default by the owner of any other parcel within the District.

16 Table 1 below describes the Assigned Special Tax rates for Fiscal Year 2026-27.

TABLE 1

CITY OF SAN BERNARDINO
COMMUNITY FACILITIES DISTRICT NO. 2022-2 (PALM)
ASSIGNED SPECIAL TAX RATES FOR FISCAL YEAR 2026-27
Land Use
Category Land Use Type
Residential
Floor Area
(sq. ft.)
Assigned/Maximum
Tax Rates FY
2026-27(1)
Special Tax
Levy Rates
FY 2026-27
Percent of
Maximum/
Assigned
Rate
No. of
Units
Aggregate
Estimated
Special Taxes
FY 2026-27(2)
Percent of
Total
1 Residential Property < 1,800 $1,552 $1,552 100.0% 24 $37,248 16.5% 2 Residential Property 1,800 - 1,950 1,595 1,595 100.0 24 38,280 17.0 3 Residential Property 1,951 - 2,100 1,637 1,637 100.0 24 39,288 17.5 4 Residential Property 2,101 - 2,250 1,764 1,764 100.0 19 33,516 14.9 5 Residential Property 2,251 - 2,400 1,806 1,806 100.0 20 36,120 16.0 6 Residential Property > 2,400 1,849 1,849 100.0 22 40,678 18.1 Total 133 $225,130 100.0%

(1) Maximum Special Tax Rate for Land Use Type Approved Property. (2) Includes estimated administrative expenses of $25,000.

Source: Spicer Consulting Group, LLC.

17 Prepayment of Special Taxes. The City Council may allow property owners to fully or partially prepay the obligation of parcels of Taxable Property to pay the Special Taxes wi th respect to the Special Tax Requirement.

Additionally, the City will covenant in the Fiscal Agent Agreement that the City shall cause all applications of owners of property in the District to prepay and satisfy the Special Tax obligation for their property to be reviewed by the Tax Consultant and shall not accept any such prepayment unless such consultant certifies in writing that following the acceptance of the proposed prepayment by the City and the redemption of Bonds with such prepayment, the maximum amount of the Special Taxes that may be levied on all Taxable Property in the District following such prepayment will be at least 1.10 times Maximum Annual Debt Service on the Bonds which will remain Outstanding following such redemption plus estimated Administrative Expenses . See APPENDIX A — “RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX” and “THE BONDS — Redemption — Mandatory Redemption from Special Tax Prepayments.” Collection and Application of Special Taxes . The Special Taxes are collected by the Treasurer -Tax Collector of the County in the same manner and at the same time as ad valorem property taxes. The District may, however, collect the Special Taxes at a different time or in a different manner if necessary to meet its financial obligations.

Covenants to Protect Special Tax Rates . The City will make certain covenants in the Fiscal Agent Agreement for the purpose of ensuring that the current maximum Special Tax rates and method of collection of the Special Taxes are not altered in a manner that would impair the District ’s ability to collect sufficient Special Taxes to pay debt service on the Bonds and Administrative Expenses when due. The City will covenant that it will not initiate proceedings under the Act to reduce the Maximum Special Tax rates (the “Maximum Rates”) on then existing Developed Property in the District below the amounts which are necessary to provide Special Tax Revenues in an amount equal to estimated Administrative Expenses for the then current Fiscal Year plus an amount equal to 110% of Maximum Ann ual Debt Service on the Outstanding Bonds. For purposes of such calculation, “Developed Property” has the meaning set forth in the Rate and Method. See “RISK FACTORS — Voter Initiatives.” The City will further covenant that in the event an ordinance is adopted by initiative pursuant to Section 3 of Article XIII C of the California Constitution, which purports to reduce or otherwise alter the Maximum Rates, it will commence and pursue legal action seeking to preserve its ability t o comply with the covenant described above.

The City will covenant not to permit the tender of Bonds in payment of any Special Taxes except upon receipt of a certificate of an Independent Financial Consultant certifying that accepting such tender will not result in the City having insufficient Special Tax Revenues to pay the principal of and interest on the Outstanding Bonds following such tender. See “RISK FACTORS — Non-Cash Payments of Special Taxes.” Although the Special Taxes constitute liens on taxable parcels within the District, they do not constitute a personal indebtedness of the owners of property within the District. Moreover, other liens for taxes and assessments already exist on the property located within the District and others could come into existence in the future in certain situations without the consent or knowledge of the City or the landowners in the District. See “RISK FACTORS — Parity Taxes and Special Assessments.” There is no assurance that property owners will be financially able to pay the annual Special Taxes or that they will pay such taxes even if financially able to do so, all as more fully described in the section of this Official Statement entitled “RISK FACTORS.” Proceeds of Foreclosure Sales. The net proceeds received following a judicial foreclosure sale of land within the District resulting from a landowner’s failure to pay the Special Taxes when due are included within the Special Tax Revenues pledged to the payment of principal of and interest on the Bonds under the Fiscal Agent Agreement.

Pursuant to Section 53356.1 of the Government Code, the City will covenant in the Fiscal Agent Agreement with and for the benefit of the Owners of the Bonds that (i) it will order, and cause to be commenced,

18 judicial foreclosure proceedings against properties in the District with delinquent Special Taxes in excess of $5,000 by October 1 following the close of the Fiscal Year in which such Special Taxes were due, and (ii) if the amount on deposit in the Reserve Fund is less than the Reserve Requirement it will commence judicial foreclosure proceedings against all properties in the District with delinquent Special Taxes by October 1 following the close of each Fiscal Year in which it receives Special Taxes in an amount, which is less than ninety-five percent (95%) of the total Special Taxes levied, and diligently pursue to completion such foreclosure proceedings . See APPENDIX D — “SUMMARY OF FISCAL AGENT AGREEMENT.”
If foreclosure is necessary and other funds (including amounts in the Reserve Fund) have been exhausted, debt service payments on the Bonds could be delayed until the foreclosure proceedings have ended with the receipt of any foreclosure sale proceeds. Ju dicial foreclosure actions are subject to the normal delays associated with court cases and may be further slowed by bankruptcy actions, involvement by agencies of the federal government and other factors beyond the control of the City and the District. S ee “RISK FACTORS — Bankruptcy and Foreclosure.” Moreover, no assurances can be given that the real property subject to foreclosure and sale at a judicial foreclosure sale will be sold or, if sold, that the proceeds of such sale will be sufficient to pay any delinquent Special Tax installment. See “RISK FACTORS — Land Values.” Although the Act authorizes the District to cause such an action to be commenced and diligently pursued to completion, the Act does not impose on the District or the City any obligation to purchase or acquire any lot or parcel of property sold at a foreclosure sale if there is no other purchaser at such sale. The Act provides that, in the case of a delinquency, the Special Tax will have the same lien priority as is provided for ad valorem taxes.

No Teeter Plan . Although the County Board of Supervisors has adopted the Alternative Method of Distribution of Tax Levies and Collections and Tax Sale Proceeds (the “Teeter Plan”), which allows each entity levying secured property taxes in the County to draw on the amount of property taxes levied rather than the amount actually collected, as provided for in Section 4701 et seq. of the California Revenue and Taxation Code, the District is not included in the County Teeter Plan. Consequently, the District ma y not draw on the County Tax Loss Reserve Fund in the event of delinquencies in Special Tax payments.

Special Tax Fund
Pursuant to the Fiscal Agent Agreement, there will be established, as a separate fund to be held by the Fiscal Agent, the “Community Facilities District No. 2022 -2 of the City of San Bernardino 2026 Special Tax Bonds Special Tax Fund” (the “Special Tax Fund”) to the credit of which the City will deposit, not later than 10 Business Days after receipt, all Special Tax Revenues received by the City.

Moneys in the Special Tax Fund and all accounts therein will be held by the Fiscal Agent for the benefit of the City and the Owners of the Bonds, will be disbursed as provided below and, pending disbursement, will be subject to a lien in favor of the Owner s of the Bonds. Notwithstanding the foregoing, any amounts received by the City which constitute Special Tax Prepayments will be transferred by the City not later than 10 business days after receipt to the Fiscal Agent for deposit by the Fiscal Agent in th e “Special Tax Prepayments Account ” established pursuant to the Fiscal Agent Agreement.

As soon as practicable after the receipt from the City of any Special Tax Revenues, but no later than 10 Business Days after such receipt, the Fiscal Agent will withdraw from the Special Tax Fund and deposit in the Administrative Expense Fund, an amount wh ich is estimated by the City, in a written communication from an Authorized Officer delivered to the Fiscal Agent (upon which the Fiscal Agent may conclusively rely) to be sufficient, together with the amount then on deposit in the Administrative Expense Fund, to pay the Administrative Expenses during the current Fiscal Year; provided, however, that the amount deposited in the Administrative Expense Fund prior to the deposits to the Interest Account and the Principal Account of the Bond Fund, as provided below, will not exceed $25 ,000 for each Fiscal Year. Thereafter, the Fiscal Agent shall deposit in the Interest Account and the Principal Account of the Bond Fund the amounts required by the Fiscal Agent Agreement, as described under “— Bond Fund” below. If after such deposits are made to the Administrative Expense Fund, the Interest Account and the Principal Account there are funds remaining on deposit in the Special

19 Tax Fund, the City shall instruct the Fiscal Agent by an Officer ’s Certificate (upon which the Fiscal Agent may conclusively rely) to transfer such amount from the Special Tax Fund to the Reserve Fund to the extent that the amount on deposit therein is less than the Reserve Requirement.

On September 2 of each year, the amount, if any, on deposit in the Special Tax Fund, together with the amount then on deposit in the Bond Fund (including the Principal Account therein but excluding the Interest Account and the Special Tax Prepayments Account), as determined by the City, shall not exceed the greater of (i) one year’s earnings on such amounts, or (ii) one-twelfth (1/12th) of Annual Debt Service for the then current Bond Year. If on September 2 of any year the amount on deposit in the Special Tax Fund, together with the amount then on deposit in the Bond Fund (other than such excluded amounts), exceeds the maximum amount allowable pursuant to the preceding sentence, as determined by the City and communicated in writing by an Authorized Officer to the Fiscal Agent (upon which the Fiscal Agent may conclusively rely), moneys shall be transferred from the Special Tax Fund to the Administrative Expense Fund to pay any additional Administrative Expenses during the then current Fiscal Year, as directed in writing by the City. The Fiscal Agent shall have no obligation to monitor the City’s obligations as set forth in the foregoing sentence. Subject to the requirement described above, on each September 2, commencing September 2, 2027, any funds remaining in the Special Tax Fund which are not needed to pay principal and/or interest on the Bonds then due and payable may be retained in the Special Tax Fund to reduce the Special Taxes levied in future years (subject to the limitations set forth in the Rate and Method).

Moneys in the Special Tax Fund will be invested and deposited in accordance with the Fiscal Agent Agreement. Investment Earnings will be retained in the Special Tax Fund to be used for the purposes of such fund to the extent set forth in the Fiscal Agent Agreement. See APPENDIX D — “SUMMARY OF FISCAL AGENT AGREEMENT.”
Bond Fund
Pursuant to the Fiscal Agent Agreement, there will be established, as a separate fund to be held by the Fiscal Agent, the “Community Facilities District No. 2022 -2 of the City of San Bernardino 2026 Special Tax Bonds Bond Fund” (the “Bond Fund”) and within the Bond Fund, an Interest Account, a Principal Account and a Special Tax Prepayments Account. 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 o f 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.

On or before each Interest Payment Date, the Fiscal Agent shall transfer from the Special Tax Fund and deposit into the following respective accounts in the Bond Fund, the following amounts in the following order of priority, the requirements of each such account (including the making up of any deficiencies in any such account resulting from lack of Special Tax Revenues sufficient to make any earlier required deposit) at the time of deposit to be satisfied before any transfer is made to any account subsequent in priority:

Interest Account. On or before each Interest Payment Date, the Fiscal Agent shall deposit in the Interest Account an amount required to cause the aggregate amount on deposit in the Interest Account to equal the amount of interest becoming due and payable on the Bonds on such date. No deposit need be made into the Interest Account on any Interest Payment Date if the amount on deposit therein is at least equal to the interest becoming due and payable on the Bonds on such date. All moneys in the Interest Account shall be used and withdrawn by the Fiscal Agent solely for the purpose of paying the interest on the Bonds as it shall become due and payable (including accrued interest on any Bonds redeemed prior to maturity). All amounts on deposit in the Interest Account on the first day of any Bond Year, to the extent not required to pay any interest then having become due and payable on the Outstanding Bonds, shall be withdrawn therefrom by the Fiscal Agent and transferred to the Special Tax Fund.

Principal Account. On or before each Interest Payment Date which occurs on September 1, the Fiscal Agent shall deposit in the Principal Account an amount required to cause the aggregate amount on deposit in the

20 Principal Account to equal the principal amount of the Bonds becoming due and payable on such date, or the redemption price of the Bonds (consisting of the principal amount thereof and any applicable redemption premium) required to be redeemed on such date pursuant to the Fiscal Agent Agreement. All moneys in the Principal Account shall be used and withdrawn by the Fiscal Agent solely for the purpose of (i) paying the principal of the Bonds at the maturity thereof, or (ii) paying the principal of and premium (if any) on any Bonds upon the redemption thereof pursuant to the Fiscal Agent Agreement. All amounts on deposit in the Principal Account on the first day of any Bond Year, to the extent not required to pay the principal of any Outstanding Bonds then having become due and payable, shall be withdrawn therefrom by the Fiscal Agent and transferred to the Special Tax Fund.

In the event that moneys on deposit in the Special Tax Fund will be insufficient on any Interest Payment Date for the Fiscal Agent to deposit the required amounts in the Interest Account and the Principal Account, as provided above, the Fiscal Agent shall deposit the available funds first to the Interest Account up to the full amount required to cause the aggregate amount on deposit therein to equal the amount of interest becoming due and payable on the Bonds on the Interest Payment Date, and shall then dep osit the remaining available funds in the Special Tax Fund to the Principal Account up to the full amount required to cause the aggregate amount on deposit therein to equal the amount, if any, of principal becoming due and payable on the Bonds on the Inter est Payment Date. If, after making such deposits to the Interest Account and the Principal Account, and after transferring moneys from the Reserve Fund to such accounts, as provided in the Fiscal Agent Agreement, the amount on deposit in the Principal Acco unt is insufficient to pay the full amount of the principal of each of the Bonds which is due or is to be redeemed on the Interest Payment Date, the Fiscal Agent shall make a prorated payment of the principal of each of such Bonds as specified in an Officer ’s Certificate provided to the Fiscal Agent.

Reserve Fund
In order to secure further the payment of principal of and interest on the Bonds, the District will, upon delivery of the Bonds, deposit in the Reserve Fund and thereafter to maintain in the Reserve Fund an amount equal to the Reserve Requirement. The Fis cal Agent Agreement provides that the amoun t in the Reserve Fund shall equal the lesser of (i) 10% of the original issue price of the Bonds calculated in accordance with Treasury Regulations Section 1.148-2(f)(1); (ii) Maximum Annual Debt Service on the Bo nds; or (iii) 125% of average Annual Debt Service on the Bonds. Moneys in the Reserve Fund shall be held in trust by the Fiscal Agent for the benefit of the Owners of the Bonds as a reserve for the payment of the principal of and interest and any premium on the Bonds and shall be subject to a lien in favor of the Owners of the Bonds.

Subject to the limits on the maximum annual Special Tax which may be levied within the District, as described in the Rate and Method, the City will covenant to levy Special Taxes in an amount that is anticipated to be sufficient, in light of the other inte nded uses of the Special Tax proceeds, to maintain the balance in the Reserve Fund at the Reserve Requirement. The ability of the legislative body of the District to increase the annual Special Taxes levied in the District to replenish the Reserve Fund is additionally subject to certain additional limitations under the Act restricting the amount by which Special Taxes on taxable parcels can be increased due to delinquencies of other taxable parcels.

Except as otherwise provided in the Fiscal Agent Agreement, all amounts on deposit in the Reserve Fund shall be used and withdrawn by the Fiscal Agent solely for the purpose of making transfers to the Interest Account and the Principal Account of the Bond Fund in the event of any deficiency at any time in either of such accounts of the amount then required for payment of the principal of and interest and any premium on the Bonds or, in accordance with the provisions of the Fiscal Agent Agreement for the purpose of redeeming Bonds as described below.

Whenever, on any September 2, the amount in the Reserve Fund, less Investment Earnings resulting from the investment of the funds therein which pursuant to the Fiscal Agent Agreement must be rebated to the United States, as previously directed by the City, exceeds the Reserve Requirement, as calculated by the City, the Fiscal

21 Agent shall provide written notice to the City of the amount of the excess. Upon receiving written direction from an Authorized Officer (upon which the Fiscal Agent may conclusively rely), the Fiscal Agent shall, subject to the requirements of the Fiscal Agent Agreement, transfer an amount from the Reserve Fund which will reduce the amount on deposit therein to an amount equal to the Reserve Requirement to the Interest Account and the Principal Account, in such order, to be used for the payment of the inte rest on and principal of the Bonds on the next succeeding Interest Payment Date in accordance with the Fiscal Agent Agreement.

Whenever the balance in the Reserve Fund is equal to or 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, the Fiscal Agent shall, upon receiving written direction from an Authorized Officer (upon which the Fiscal Agent may conclusively rely), transfer the amount in the Reserve Fund to the Interest Account and the Principal Account, in the priority specified in the Fiscal Agent Agreement, to be applied, on the next succeeding Interest Payment Date, to the payment and redemption, in accordance with the Fiscal Agent Agreement, of all of the Outstanding Bonds. In the event that the amount available to be so transferred from the Reserve Fund to the Interest Account and the Principal Account exceeds the amount required to pay and redeem the Outstanding Bonds, the excess shall be transferred to the City to be used for any lawful purpose of the City.

In the event of a prepayment of Special Taxes, under certain circumstances, a portion of the Reserve Fund will be credited to the amount being prepaid and be applied to redeem Bonds. See APPENDIX D — “SUMMARY OF FISCAL AGENT AGREEMENT.”
No Superior Obligations; No Parity Bonds Except for Refunding The District and the City covenant in the Fiscal Agent Agreement that they will not issue any other obligations payable, as to principal or interest, from the Special Tax Revenues which have, or purport to have, any lien upon the Special Tax Revenues superior to or on a parity with the lien of the Bonds, except with respect to the redemption prior to maturity of any Bonds subject to call and redemption and payment of said Bonds from proceeds of refunding bonds issued under the Act as the same now exists or as hereafter amended, or u nder any other law of the State , which shall be payable from and have a lien upon the Special Tax Revenues on a parity with the Bonds to be outstanding following the issuance of such refunding bonds.

THE DISTRICT
The information about the Developer contained in this section of the Official Statement entitled “THE DISTRICT” has been provided by representatives of the Developer and has not been independently confirmed or verified by the Underwriter, the City or the District. None of the Underwriter, the City or the District makes any representation as to the accuracy or adequacy of the information contained in this section. There may be material adverse changes to this information after the date of this Official Statement.

No assurance can be given that the proposed development within the District will occur as described below. As the proposed development progresses and homes are sold, it is expected that the ownership of the land within the District will become more diversified. No assurance can be given that development within the District will occur in a timely manner or in the configuration described herein, or that any property owner described herein will obtain or retain ownership of any of the land within the Distric t. The Bonds and the Special Taxes are not personal obligations of any property owners, including the Developer, and, in the event that a property owner defaults in the payment of the Special Taxes, the City may proceed with judicial foreclosure but has no direct recourse to the assets of any property owner. As a result, other than as provided herein, no financial statements or information is, or will be, provided about the Developer or any other property owner. The Bonds are secured solely by the Specia l Tax Revenues and other amounts pledged under the Fiscal Agent Agreement.

See “SOURCES OF PAYMENT FOR THE BONDS” and “RISK FACTORS.” The information under this of the Official Statement includes forward -looking statements. See the cautionary information regarding forward-looking statements in this Official Statement on the page immediately

22 preceding the Table of Contents. As previously discussed, such forward -looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by such statements. Readers are cautioned not to place undue reliance on such forward -looking statements, which only speak as of the date of this Official Statement.

General Description of the District
The District contains approximately 14.70 acres, located in the City, north of E. Highland Avenue and west of N. Palm Avenue. The District is planned for 133 single family residential homes at buildout in a neighborhood being marketed as “Summit Park.” T he Developer is actively developing the Project into two product lines, “Aurora” and “Paloma.”
As of the Date of Value of the Appraisal Report, 61 of the 133 planned single family residential homes had been completed and conveyed to individual homeowners. Of the remaining 72 residential lots owned by the Developer, 67 were completed homes, including 6 model homes (not released for sale), and 5 were under construction. As of June 1, 2026, an additional [__] homes closed escrow to individual homeowners, resulting in [__] homes conveyed to individual homeowners. As of June 1, 2026, of the remaining [__] residential lots owned by Developer, [__] were completed homes ([__] of which were in escrow but not yet closed), including 3 model homes (not released for sale), and [__] were under construction. Homes under contract may not result in closed escrows as sales contracts are subject to cancellation by the homebuyers.

The Developer has obtained building permits for all 133 residential lots within the District . The Developer expects to complete home construction by October 2026 and expects to close escrow on the remaining homes by June 2027.

The Developer
As previously define d in this Official Statement, the Developer is Richmond American Homes of Maryland, Inc., a Maryland corporation. The Developer is a wholly-owned subsidiary of M.D.C. Holdings, Inc., a Delaware corporation (“MDC”). The Developer and its predecessor entity have been building homes in California si nce 1986. The Developer’s Southern California division is based in Irvine, California and is responsible for the development of the Developer’s project in the District.

On January 17, 2024, MDC entered into an Agreement and Plan of Merger (“Merger Agreement”) with SH Residential Holdings, LLC, a Delaware limited liability company (“SH Residential”), Clear Line, Inc., a Delaware corporation and indirect wholly owned subsidiary of SH Residential (“Merger Sub” and together with SH Residential, the “Buyer Parties”) and, solely for the purposes of Section 6.2, Section 6.17 and Section 9.15 of the Merger Agreement, Sekisui House, Ltd., a Japanese kabushiki kaisha (“Sekisui House”). On April 19, 2024, the Buyer Parties completed the acquisition of MDC, with Merger Sub merging with and into MDC and MDC continuing as an indirect wholly owned subsidiary of SH Residential and Sekisui House.

Also on April 19, 2024, Sekisui House (Tokyo: 1928) issued a press release announcing that, through SH Residential, its U.S. business controlling company, it had completed its acquisition of MDC, adding MDC to Woodside Homes, Holt Homes, Chesmar Homes and Hubble Homes in its Sekisui House Group. Sekisui House is a house manufacturer in Japan, engaging in custom detached houses, rental housing, architectural/civil engineering, remodeling, real estate management, houses for sale, condominiums, urban redevelop ment and overseas business. Having delivered millions of homes worldwide since its establishment (as of January 31, 2024), Sekisui House has footprints in Japan, the U.S., Australia, Singapore, and the U.K.

MDC has two primary operations, homebuilding and financial services. MDC’s homebuilding operations consist of wholly-owned subsidiary companies that build and sell homes under the name “Richmond American Homes.” MDC’s financial services operations include subsidiary companies that provide mortgage financing,

23 place title insurance and homeowner insurance for the Developer’s homebuyers, and provide general liability insurance for MDC subsidiaries and most of the Developer’s subcontractors.

The Development
The District is planned for 133 single family residential homes at buildout in a neighborhood being marketed as “Summit Park.” The Developer is actively developing the Project into two product lines, “Aurora” and “Paloma.” The Developer has obtained building permits for all 133 homes in the District.

Aurora at Summit Park. The Aurora product line is planned for 61 single family detached homes.

The following Table 2 sets forth the estimated number of lots, home sizes, and base sales prices for the Aurora product line as of June 1, 2026. Sales of homes within the Aurora community began in March 2025 and Developer expects that all homes will be completed and conveyed by June 2027, but no assurance can be provided that this will occur.

TABLE 2

CITY OF SAN BERNARDINO
COMMUNITY FACILITIES DISTRICT NO. 2022-2 (PALM)
DEVELOPMENT STATUS – AURORA
(as of June 1, 2026)
Floor Plan
Approx.

Square
Footage
Total
Number of
Planned
Units(1)
Units
Closed to
Homeowners
Units
Completed But
Not Closed to
Homeowners(2)
Units Under
Construction
Finished
Lots
Estimated
Base Price(3)
1 2,134 19 0 $529,705
2 2,334 20 0 565,879
3 2,487 22 0 577,990
61 0

(1) The number of units in each plan is an estimate and is subject to change as the market dictates. (2) Includes 3 model homes.
(3) Base sales prices are subject to change and exclude any lot premiums, options, upgrades, incentives and any selling concessio ns or price reductions which may be offered.

Source: Developer.

No assurance can be given that home construction and sales will be carried out on the schedules 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. Additionally, homes under contract to be sold may not result in closed escrows as sales contracts are subject to cancellation. See “SPECIAL RISK FACTORS — Failure to Develop Properties.” Moreover, rising interest rates may affect pro spective buyers’ willingness or ability to close escrow or enter into future sales contracts. See “SPECIAL RISK FACTORS — Mortgage Interest Rates.”
Paloma at Summit Park. The Paloma community is planned for 72 detached single-family homes.

The following Table 3 sets forth the estimated number of units, home sizes, and base sales prices for the Paloma product line as of June 1, 2026. Sales of homes within the Paloma neighborhood began in March 2025 and Developer expects that all homes within the Paloma neighborhood will be completed and conveyed by April 2027, but no assurance can be provided that this will occur.

24 TABLE 3

CITY OF SAN BERNARDINO
COMMUNITY FACILITIES DISTRICT NO. 2022-2 (PALM)

DEVELOPMENT STATUS - PALOMA
(as of June 1, 2026)
Floor Plan
Approx.

Square
Footage
Total
Number of
Planned
Units(1)
Units
Closed to
Homeowners
Units
Completed But
Not Closed to
Homeowners(2)
Units Under
Construction
Finished
Lots
Estimated
Base Price(3)
1 1,653 24 0 $505,550
2 1,809 24 0 504,564
3 1,989 24 0 517,240
72 0

Source: Developer.

No assurance can be given that home construction and sales will be carried out on the schedules 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. Additionally, homes under contract to be sold may not result in closed escrows as sales contracts are subject to cancellation. See “SPECIAL RISK FACTORS — Failure to Develop Properties.” Moreover, rising interest rates may affect pros pective buyers’ willingness or ability to close escrow or enter into future sales contracts. See “SPECIAL RISK FACTORS — Mortgage Interest Rates.”
Mortgage Interest Rates.

Most of the purchasers of the 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 Developer’s planned for-sale homes in the District. 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 Developer’s 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 Developer’s planned for-sale homes in the District.

Impact of Economic Conditions on the Development in the District Certain events and factors which negatively affect the regional, State and national economies could have an adverse effect on the pace at which the Developer can complete the remaining future homes, and demand by, and the ability of individuals to purchase homes within the District. Such events and factors could include rising inflation and interest rates, persistent supply chain issues, pandemics and global market instability caused by the war or hostilities. Any adverse impact of the foregoing and other economic factors on the project in the District and the real estate market in general cannot be predicted.

Financing Plan. To date, Developer has financed its land acquisition and various site development and home construction costs related to its property in the District through internally generated funds and homes sales revenues. As of May 15, 2026, Developer had expended approximately $55,154,050 on land acquisition, land development, homebuilding, marketing and sales costs. As of such date, Developer expected to incur

25 approximately $1,540,432 on remaining land development costs and ap proximately $2,524,540 on remaining homebuilding, marketing, and sales costs for its property in the District.

Developer expects to use home sales revenues and internal funding to complete its development in the District. Developer believes that it will have sufficient funds available to complete its planned development in the District in accordance with the development schedule described in this Official Statement.

Although the Developer expects to have sufficient funds available to complete its development in the District, commensurate with the development timing described in this Official Statement, there can be no assurance that amounts necessary to finance the remaining development and home construction costs within the District will be available to the Developer when needed. While the Developer has made such internal funding available in the past, there can be no assurance whatsoever of its willingness or abilit y to do so in the future.

Neither the Developer, nor any other entity or person is under any legal obligation of any kind to expend funds for the development of and construction of homes in the District or the payment of ad valorem property taxes or the Special Taxes. Any contributions by the Developer or any other entity or person to fund the costs of such development are entirely voluntary.

If and to the extent the aforementioned sources are inadequate to pay the costs to complete the planned development by the Developer within the District and other financing by the Developer is not put into place, there could be a shortfall in the funds required to complete the proposed development by the Developer in the District and the remaining portions of the project in the District may not be completed. There is no legal obligation to Bondholders to make any such funds available for land development, construction, or the payment of ad valorem property taxes or the Special Taxes. See “RISK FACTORS” herein for a discussion of risk factors.

Overlapping Community Facilities Districts
The principal of and interest on the Bonds are payable from the Special Tax authorized to be collected within the District, and payment of the Special Tax is secured by a lien on certain real property within the District.

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 the District. 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 and have formed 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 the District. See “-Estimated Direct and Overlapping Indebtedness.”

26 Estimated Direct and Overlapping Indebtedness
Within the boundaries of the District are other overlapping local agencies providing public services. The approximate amount of the direct and overlapping debt on the parcels within the District as of April 15, 2026, is shown in Table 4 below.

TABLE 4
COMMUNITY FACILITIES DISTRICT NO. 2022-2 (PALM)

OF THE CITY OF SAN BERNARDINO

DIRECT AND OVERLAPPING DEBT
As of April 15, 2026
I. Appraisal /Assessed Value(1)(4) $66,487,772

II. Land Secured Bond Indebtedness

Outstanding Direct and Overlapping Bonded Debt
Type Issued Outstanding % Applicable
Amount
Applicable
CITY OF SAN BERNARDINO CFD NO. 2022-2, Series 2026 CFD $ 2,885,000* $ 2,885,000* 100.000% $2,885,000* TOTAL LAND SECURED BONDED DEBT(2) $2,885,000*

III. General Obligation Bond Indebtedness

Outstanding Direct and Overlapping Bonded Debt
Type Issued Outstanding % Applicable
Amount
Applicable
SAN BERNARDINO UNIFIED SCHOOL DISTRICT GO $ 439,999,534 $ 282,191,414 0.091% $ 256,107 SAN BERNARDINO COMMUNITY COLLEGE GO 1,159,995,486 1,003,194,770 0.016 163,666 TOTAL OUTSTANDING GENERAL OBLIGATION BONDED DEBT (3) $ 419,773

Authorized but Unissued Direct and Overlapping Indebtedness Type Authorized Unissued %
Applicable(2) Applicable
SAN BERNARDINO UNIFIED SCHOOL DISTRICT GO $ 440,000,000 $ 466 0.091% $ 0 SAN BERNARDINO COMMUNITY COLLEGE GO 1,160,000,000 4,514 0.016 1 TOTAL UNISSUED GENERAL OBLIGATION INDEBTEDNESS(3) $ 1

TOTAL OUTSTANDING AND UNISSUED GENERAL OBLIGATION INDEBTEDNESS $419,774

TOTAL OF ALL OUTSTANDING DIRECT AND OVERLAPPING BONDED DEBT $3,304,773* TOTAL OF ALL OUTSTANDING DIRECT AND UNISSUED DIRECT OVERLAPPING INDEBTEDNESS $3,304,774*

IV. Ratios to Appraisal Value
Outstanding Land Secured Bonded Debt 23.05:1*
Total Outstanding Bonded Debt 20.12:1*

(1) Represents the appraised/assessed value as set forth in the Appraisal Report, as of the Date of Value. (2) Following the issuance of the Bonds, no additional bonds can be issued on a parity basis with the Bonds, with the exception of refunding bonds. (3) Calculated by dividing the appraised value by the total assessed value for Fiscal Year 2025-26. (4) All parcels have subdivided into 133 individual parcels. Based on projected development status as of April 15, 2026, 133 parcels will be classified as Developed Property under the Rate and Method for Fiscal Year 2026-27. * Preliminary, subject to change.

Source: San Bernardino County Assessor’s Office; Spicer Consulting Group, LLC.

Expected Tax Burden
Based on the appraised/assessed values within the District set forth in the Appraisal Report, the projected debt service on the Bonds, and estimated District Administrative Expenses of $ 25,000 for Fiscal Year 2025-26, the City expects that, in Fiscal Year 2025-26, the effective tax rates levied on taxable property in the District will range from approximately 1.98% to 2.02% of average appraised/assessed value of homes within each Land Use Category (as defined in the Rate and Method). Subject to the limitations established by the Rate and Method and the provisions of the Act, the City Council will covenant in the Fiscal Agent Agreement to levy Special Taxes on parcels of taxable property in the District in each Fiscal Year in an amount sufficient to pay debt service on the outstanding Bonds.

27 Table 5 below describes the Fiscal Year 2025-26 effective tax burden for sample units of Developed Property within the District. The tax rates and amounts presented in this Official Statement are based on currently available information. The actual amounts charged may va ry and may increase in future years depending on the amount of Bonds, and the number of delinquencies in the District, among other factors.

TABLE 5
COMMUNITY FACILITIES DISTRICT NO. 2022-2 (PALM)

OF THE CITY OF SAN BERNARDINO
PROJECTED FISCAL YEAR 2023-24 EFFECTIVE TAX OBLIGATION

FOR SAMPLE DEVELOPED PROPERTY
Neighborhood Paloma Aurora
Plan Type Newbridge Niagra Nigel Ballard Barbara Bastian CFD Tax Category (sq. ft.) <1,800 1,800 – 1,950 1,951 – 2,100 2,101 – 2,250 2,251 – 2,400 >2,400

Plan 1 2 3 1 2 3
Home Size (sq. ft.) 1,653 1,809 1,989 2,134 2,334 2,487

Appraisal Value(1) $500,000 $515,000 $525,000 $528,000 $545,000 $555,000 Ad Valorem Property Taxes:

General Purpose $5,000 $5,150 $5,250 $5,280 $5,450 $5,550 San Bernardino Unified School (0.08170%) 408 421 429 431 445 453 San Bernardino Community College (0.04989%) 249 257 262 263 272 277 San Bernardino Valley Municipal Water District (0.1100%) 550 567 578 581 600 611 Total General Property Taxes $6,208 $6,394 $6,518 $6,556 $6,767 $6,891

Assessment, Special Taxes & Parcel Charges:

County Fire Protection District Services Zone FP-5 $182 $182 $182 $182 $182 $182 San Bernardino Vector Control District 6 6 6 6 6 6
City of San Bernardino CFD 2018-1 Safety Services 416 416 416 416 416 416 City of San Bernardino CFD 2019-1 Maintenance Services 228 228 228 228 228 228 EVWD CFD 1,370 1,394 1,420 1,495 1,521 1,545
The District(2) 1,552 1,595 1,637 1,764 1,806 1,849
Total Assessments & Special Taxes $3,754 $3,821 $3,889 $4,091 $4,159 $4,226

Total Property Tax $9,962 $10,215 $10,407 $10,647 $10,926 $11,117 Effective Tax Rate(3) 1.99% 1.98% 1.98% 2.02% 2.01% 2.00%

(1) Reflects the appraised value based as of the Date of Value and ownership. (2) Reflects the District’s Fiscal Year 2025-26 Special Tax levy for facilities for developed parcles and includes priority Administrative Expenses in the amount of $25,000. (3) Includes the full Assigned Tax Rate for each category.

Source: San Bernardino County Assessor’s Office; Spicer Consulting Group, LLC.

28 Estimated Value-to-Lien Ratio
The appraised/assessed value of the property in the District as of t he Date of Value was $66,487,772.

Dividing the appraised value by the principal amount of the Bonds results in value to lien ratio of 23.05* to 1 for the District. The ratio for total outstanding bonded debt including overlapping debt is 20.12* to 1 for the District.

Additional land-secured special tax or assessment debt , however, could be applicable to the parcels within the District in the future. See “RISK FACTORS — Parity Taxes and Special Assessments.”

* Preliminary, subject to change.

29 Table 6 below reflects the values assigned to parcels in the Appraisal Report, the estimated principal amount of the Bonds and the es timated appraised value-to-lien ratios in the District, based on the estimated Fiscal Year 2026-27 Special Tax levy, categorized by property ownership.

TABLE 6
COMMUNITY FACILITIES DISTRICT NO. 2022-2 (PALM)

OF THE CITY OF SAN BERNARDINO
ESTIMATED VALUE-TO-LIEN RATIOS FOR FISCAL YEAR 2026-27

ALLOCATED BY PROPERTY OWNERSHIP
(As of April 15, 2026)
Property Owner
No. of
Units
Appraised
Property
Value(3)
Percentage of
Appraised
Value
FY 2026-27
Maximum
Special Tax
FY 2026-27
Percentage
of
Maximum
Special
Tax Levy
Projected
Fiscal Year
2026-27
Levy(4)
Percentage of
Projected
Fiscal Year
2026-27 Levy
Proposed
Bonds(5)*
All Other
Overlapping
Debt Issued
Appraised
Value-to-
Lien
Ratio*
Developed – Individually Owned(1) 61 $31,927,560 48.02% $114,605 45.86% $92,371 45.62% $1,316,005 $191,481 21.18:1 Developed – Richmond American(2) 72 34,560,212 51.98 135,272 54.14 110,129 54.38 1,568,995 228,292 19.23:1 Total Developed 133 $66,487,772 100.00% $249,877 100.00% $202,500 100.00% $2,885,000 $419,773 20.12:1

Total 133 $66,487,772 100.00% $249,877 100.00% $202,500 100.00% $2,885,000 $419,773 20.12:1

(1) Reflects Appraised Value for 56 Completed Homes, and the Assessed Value for 5 Completed Homes which have been sold to individual homeowners. (2) Reflects Appraised Value for 5 Models, 5 Under Construction, and 61 Completed Homes, and the Assessed Value for 1 model home. (3) Reflects the appraised value as of the Date of Value. (4) Estimated Fiscal Year 2026-27 Special Tax Levy based upon development status as of April 15, 2026 and preliminary debt service with administration of $25,000. (5) Includes the principal amount of the Bonds. Responsibility of the principal amount of the Bonds has been allocated based on the projected Fiscal Year 2026-27 Special Tax levy based on development status in the District as of April 15, 2026.
* Preliminary, subject to change.

Source: San Bernardino County Assessor’s Office; Spicer Consulting Group, LLC.

30 Table 7 below sets forth the appraised value-to-lien ratios for the parcels of Taxable Property in the District by value -to-lien ranges based on the projected Fiscal Year 2026-27 Special Tax levy and development status as of the Date of Value. Since the Date of Value, the Developer has conveyed additional homes to individual homeowners and has commenced construction of additional homes within the Distric t. See “THE DISTRICT – The Development.”
TABLE 7
COMMUNITY FACILITIES DISTRICT NO. 2022-2 (PALM)

OF THE CITY OF SAN BERNARDINO

VALUE-TO-LIEN STRATIFICATION FOR TAXABLE PROPERTY ONLY
(As of April 15, 2026)
Value-to Lien Category
No. of
Parcels of
Developed
Property
Percentage
of
Developed
Property
Appraised
Value(1)
Percentage
of Appraised
Value
District
Projected
Fiscal Year
2026-27 Levy
Percent
Share of
Projected
Fiscal Year
2026-27
Levy
Proposed
Bonds*(2)
Percent
Share of
Proposed
Bonds*
All Other
Overlapping
Debt
Aggregate
Value-to-
Lien*
Less than 18.00:1(3) 5 3.76% $995,000 1.50% $7,553 3.73% $107,606 3.73% $15,657 8.07:1 Between 18.01:1 to 19.00:1 5 3.76 2,544,113 3.83 8,316 4.11 118,473 4.11 17,238 18.75:1 Between 19.01:1 to 20.00:1 34 25.56 17,457,447 26.26 55,013 27.17 783,767 27.17 114,040 19.44:1 Between 20.01:1 to 21.00:1 52 39.10 26,441,212 39.77 78,356 38.69 1,116,324 38.69 162,427 20.68:1 Greater than 21.00:1(3) 37 27.82 19,050,000 28.65 53,263 26.30 758,829 26.30 110,411 21.92:1 Total 133 100.00% $66,487,772 100.00% $202,500 100.00% $2,885,000 100.00% $419,773 20.12:1

(1) Reflects the appraised/assessed value as of the Date of Value. (2) Responsibility of the par amount has been allocated based on the projected Fiscal Year 2026-27 Special Tax levy, with development status as of April 15, 2026, and preliminary bond sizing as provided by the Underwriter.
(3) The minimum value to lien in the Less Than 18.00:1 category is 7.33:1. The maximum value to lien in the Greater Than 21.00:1 category is 22.00:1. * Preliminary, subject to change.

Source: San Bernardino Assessor’s Office; Spicer Consulting Group, LLC.

31 Delinquency History
For Fiscal Year 2025 -26, as of April 15, 2026, there were two parcels delinquent in a total amount of $1,743 or 0.82%.

City’s Collection Practices
The staff of the City provides administrative and other support services for the community facilities districts that have been formed by the City. These services include, but are not limited to, attempting to collect delinquent special taxes prior to the commencement of foreclosure proceedings by sending demand letters to property owners whose special taxes are delinquent advising them of the consequences of failing to pay the applicable special taxes. The City expects to levy Special Taxes within the District and will covenant in the Fiscal Agent Agreement to commence foreclosure proceedings against parcels with delinquent Special Taxes under certain circumstances described in this Official Statement. See “SOURCES OF PAYMENT FOR THE BONDS — Special Taxes — Proceeds of Foreclosure Sales.”

RISK FACTORS
The purchase of the Bonds involves significant investment risks and, therefore, the Bonds are not suitable investments for many investors. The following is a discussion of certain risk factors which should be considered, in addition to other matters set forth in this Official Statement, in evaluating the investment quality of the Bonds.

The Bonds have not been rated by a rating agency. This discussion does not purport to be comprehensive or definitive and does not purport to be a complete statement of al l factors which may be considered as risks in evaluating the credit quality of the Bonds. The occurrence of one or more of the events discussed in this section of this Official Statement could adversely affect the ability or willingness of property owners in the District to pay their Special Taxes when due. Such failures to pay Special Taxes could result in the inability of the District to make full and punctual payments of debt service on the Bonds. In addition, the occurrence of one or more of the events discussed in this section of this Official Statement could adversely affect the value of the property in the District. See “— Land Values” and “— Limited Secondary Market” below.

Risks of Real Estate Secured Investments Generally
The Bond Owners will be subject to the risks generally incident to an investment secured by real estate, including, without limitation, (i) adverse changes in local market conditions, such as changes in the market value of real property in the vicinity of the District, the supply of or demand for competitive properties in such area, and the market value of residential property or buildings and/or sites in the event of sale or foreclosure; (ii) changes in real estate tax rates and other operating expenses, g overnmental rules and fiscal policies; and (iii) natural disasters (including, without limitation, fires, earthquakes and floods), which may result in uninsured losses.

No assurance can be given that the individual homeowners will pay Special Taxes in the future or that they will be able to pay such Special Taxes on a timely basis. See “— Bankruptcy and Foreclosure” below, for a discussion of certain limitations on the District’s ability to pursue judicial proceedings with respect to delinquent parcels.

Limited Obligations
The Bonds and related interest are not payable from the funds of the City. Except with respect to the Special Taxes, neither the credit nor the taxing power of the District or the City is pledged for the payment of principal or interest of the Bonds, and, except as provided in the Fiscal Agent Agreement, no Owner of the Bonds may compel the exercise of any taxing power by the District or the City or force the forfeiture of any City or District property. The principal of, premium, if any, and interest on the Bonds are not a debt of the City or a legal or equitable pledge, charge, lien or encumbrance upon any of the City’s or District’s property or upon any of the City’s or District ’s income, receipts or revenues, except the Special Tax Revenues and other amounts pledged under the Fiscal Agent Agreement.

32 Availability of Hazard Insurance
According to the California Department of Insurance, insurance companies declined to renew 2.8 million homeowner policies in the State. Insurers have been exiting the State, refusing to write new policies in areas they consider to be at high risk for certain hazards (e.g., wildfire hazard), or in some cases refusing to offer coverage for high -value homes, which insurance companies generally classify as homes with a replacement cost of $750,000 or higher. Such cancellations generally have resulted in increas ed cost to homeowners as they obtain replacement coverage. The California FAIR Plan Association provides insurance to homeowners who cannot otherwise find insurance coverage, but policies through the FAIR Plan do not provide as much coverage as traditional homeowner’s insurance and tend to bear rates that are higher than traditional homeowner’s insurance.

Though several legislative and policy revisions are circulating, neither the City nor the District can predict whether homeowner’s insurance will continue to be available to home purchasers at affordable rates. An increase in homeowner’s insurance rates may reduce affordability and may cause homeowners to be unable or unwilling to pay the Special Taxes when due.

Insufficiency of Special Taxes
The annual amount of Special Tax to be levied on each taxable parcel in the District will generally be based on the land use class to which a parcel of Developed Property is assigned under the Rate and Method. See APPENDIX A — “RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX ” and “SOURCES OF PAYMENT FOR THE BONDS — Special Taxes — Rate and Method of Apportionment of Special Tax.” The maximum Special Tax for each Assessor’s Parcel of Single Family Residential Property in any Fiscal Year shall be the greater of (i) the Assigned Special Tax or (ii) the Backup Special Tax. See APPENDIX A — “RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX .” Notwithstanding that the maximum Special Taxes that may be levied in the District exceeds debt service due on the Bonds, the Special Taxes collected could be inadequate to make timely payment of debt service either because of nonpayment or because propert y becomes exempt from taxation as permitted in the Rate and Method.

In order to pay debt service on the Bonds, it is necessary that the Special Taxes be paid in a timely manner.

Should the Special Taxes not be paid on time, the City has established a Reserve Fund under the Fiscal Agent Agreement to pay debt service on the Bonds to the extent other funds are not available. See “SOURCES OF PAYMENT FOR THE BONDS — Reserve Fund.” The City will covenant in the Fiscal Agent Agreement to maintain in the Reserve Fund an amount equal to the Reserve Requirement subject, however, to the limitation that the City may not levy the Special Tax in the District in any Fiscal Year at a rate in excess of the maximum amounts permitted under the Rate and Method. In addition, under no circumstances may the Special Tax levied against any parcel used for private residential purposes be increased as a consequence of delinquency or default by owner of any other parcel or parcels within the District by more than 10% in any Fiscal Year. As a result, if a significant number of delinquencies occurs, the District could be unable to replenish the Reserve Fund to the Reserve Requirement. If such defaults were to continue in successive years, the Reserve Fund could be depleted and a default on the Bonds could occur.

The City will covenant in the Fiscal Agent Agreement that, under certain conditions, it will institute judicial foreclosure proceedings to sell any property with delinquent Special Taxes in order to obtain funds to pay debt service on the Bonds. If foreclosure proceedings were ever instituted, any mortgage or deed of trust holder could, but would not be required to, advance the amount of the delinquent Special Tax to protect its security interest. See “SOURCES OF PAYMENT FOR THE BONDS — Special Taxes — Proceeds of Foreclosure Sales” for provisions which apply in the event of such foreclosure and which the City is required to follow in the event of delinquencies in the payment of the Special Tax.

In the event that sales or foreclosures of property are necessary, there could be a delay in payments to owners of the Bonds (if the Reserve Fund has been depleted) pending such sales or the prosecution of such foreclosure proceedings and receipt by the Ci ty on behalf of the District of the proceeds of sale. The City may

33 adjust the future Special Tax levied on taxable parcels in the District, subject to the limitation on the maximum Special Tax, to provide an amount required to pay interest on, principal of, and redemption premiums, if any, on the Bonds, and the amount, if any, necessary to replenish the Reserve Fund to an amount equal to the Reserve Requirement and to pay all current expenses. There is, however, no assurance that the total amount of the Special Tax that could be levied and collected against taxable parcels in the District will be at all times sufficient to pay the amounts required to be paid by the Fiscal Agent Agreement, even if the Special Tax is levied at the maximum Special Tax rates. See “Bankruptcy and Foreclosure” below for a discussion of potential delays in foreclosure actions.

The Rate and Method governing the levy of the Special Tax expressly exempts property owned by public agencies and other exempt entities in the District. See APPENDIX A — “RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX.” If for any reason Property becomes exempt from taxation by reason of ownership by a non -taxable entity such as the federal government, another public agency or a religious organization, subject to the limitations of the maximum authorized rates, the Special Tax will be reallocated to the remaining taxable properties within the District. This would result in the owners of such property paying a greater amount of the Special Tax and could have an adverse impact upon the ability and willingness of the owners of such property to pay the Special Tax when due.

The Act provides that, if any property within the District not otherwise exempt from the Special Tax is acquired by a public entity through a negotiated transaction, or by gift or devise, the Special Tax will continue to be levied on and enforceable against the public entity that acquired the property. In additio n, 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 proper ty is to be treated as if it were a special assessment and be paid from the eminent domain award. The constitutionality and operation of these provisions of the Act have not been tested in the courts. Due to problems of collecting taxes from public agenc ies, if a substantial portion of land within the District was to become owned by public agencies, collection of the Special Tax might become more difficult and could result in collections of the Special Tax which might not be sufficient to pay principal of and interest on the Bonds when due and a default could occur with respect to the payment of such principal and interest.

Assessed Valuations
The estimated valuation of some of the Taxable Parcels in the District set forth in this Official Statement are based on the County Assessor’s values. The assessed value is not an indication of what a willing buyer might pay for a property. The assessed 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 Taxable Parcels in the District could be sold for the assessed value if that property should become delinquent and subject to foreclosure proceedings.

Special Tax Delinquencies
Under provisions of the Act, the Special Taxes, from which funds necessary for the payment of principal of, and interest on, the Bonds are derived, are customarily billed to the properties within the District on the ad valorem property tax bills sent to ow ners of such properties. The Act currently provides that such Special Tax installments are due and payable, and bear the same penalties and interest for non -payment, as do ad valorem property tax installments.

See “SOURCES OF PAYMENT FOR THE BONDS — Special Taxes — Proceeds of Foreclosure Sales,” for a discussion of the provisions which apply, and procedures which the City is obligated to follow under the Fiscal Agent Agreement, in the event of delinquencies in the payment of Special Taxes. See “— FDIC/Federal Government Interests in Properties ” below, for a discussion of the policy of the Federal Deposit Insurance Corporation (the “FDIC”) regarding the payment of special taxes and assessment and limitations on the City’s

34 ability to foreclose on the lien of the Special Taxes in certain circumstances where property within the District is owned by the federal government, agencies of the federal government, or, possibly, government sponsored enterprises such as Federal Nationa l Mortgage Association ( “Fannie Mae”) and Federal Home Loan Mortgage Corporation (“Freddie Mac”).

The City has the authority and the obligation, subject to the Act and the maximum Special Tax rates set forth in the Rate and Method, to increase the levy of Special Taxes against non-delinquent property owners in the District in the event other owners in the District are delinquent. Pursuant to the Rate and Method and the Act, under no circumstances may the Special Tax levied against any parcel used for private residential purposes be increased as a consequence of delinquency or default by owner of any ot her parcel or parcels within the District by more than 10% in any Fiscal Year. Thus, the City may not be able to increase Special Tax levies in future Fiscal Years by enough to make up for delinquencies for prior Fiscal Years. This would result in draws on the Reserve Fund, and if delinquencies continue and in the aggregate exceed the Reserve Fund balance, defaults would occur in the payment of principal and interest on the Bonds.

Although the City will covenant in the Fiscal Agent Agreement to commence and diligently pursue foreclosure under the circumstances described under the caption “SOURCES OF PAYMENT FOR THE BONDS — Special Taxes — Proceeds of Foreclosure Sales, ” foreclosure delays may occur under the circumstances described under the caption “RISK FACTORS — Bankruptcy and Foreclosure.” Delinquencies may result as a consequence of many factors. High concentration of ownership could increase the risk of delinquencies. See “RISK FACTORS – Concentration of Ownership, - Bankruptcy and Foreclosure ,” for a discussion of certain potential causes of delinquencies.

Natural Disasters, Geologic, Topographic and Climatic Conditions The District, like all California communities, may be subject to unpredictable seismic activity, fires, drought, flood, or other natural disasters.

Seismic Risks . Southern California is a seismically active area. On June 4, 2020, there was a 5.5 magnitude earthquake in the in Searless Valley, California in the County of San Bernardino. The City is located between several active fault zones including: the San Andreas Fault, the San Jacinto Fault, the Glen Helen Fault and the Loma Linda Fault. Seismic activity represents a potential risk for damage to buildings, roads, bridges and property within the District. In addition, land susceptible to seismic activity may be subject to liquefaction during the occurrence of such event. The District is not located within an earthquake fault zone or a FEMA Special Flood Hazard Area.

Fire Risks. In recent years, wildfires have caused extensive damage throughout the State. Certain of these fires have burned thousands of acres and destroyed hundreds and in some cases thousands of homes. In some instances, entire neighborhoods have been destroye d. In January 2025, multiple fires occurred across communities in Los Angeles County, including Pacific Palisades, Malibu and Altadena, some of which damaged or destroyed property in areas that were not previously considered to be at risk from such events.

In June 2025, the Ranch Fire burned over 4,000 acres in San Bernardino County. No structures in the City were damaged. There were no evacuations of City residents. In addition, other recent fires with smaller impact, such as the Gold Fire and State Fire have occurred in areas proximate to the City. No damage, however, was done to any structures within the City due to these fires.

In March 2025, Department of Forestry and Fire Protection of the State (“Cal Fire”) released an updated Fire Hazard Severity Zone map for the Southern California region. The Cal Fire Hazard Severity Zone maps evaluate fire hazard, which is defined as the l ikelihood and expected fire behavior over a 30 to 50 -year period without considering mitigation measures such as home hardening, recent wildfire or fuel reduction efforts, as opposed to risk, which is the potential damage a fire can do to the area under existing conditions, accounting for any modifications such as fuel reduction projects, defensible space, and ignition resistant building construction.

35 Pursuant to State law, the State Fire Marshal is mandated to classify the state responsibility areas where the state has financial responsibility for wildfire protection and prevention into Fire Hazard Severity Zones classified as “Moderate,” “High” or “Very High.” In areas designated as local responsibility areas, where local agencies have financial responsibility for wildfire protection and revision, Cal Fire’s Fire Hazard Severity Zone maps make recommendations for the classification of Moderate, High or Very High Fire Hazard Severity Zones and the local agencies must adopt maps which either adopt Cal Fire’s recommendations or place the relevant areas in a higher classification. For more information on Cal Fire’s Fire Hazard Severity Zone maps, see the C al Fire website. [Portions of the District are located within an area which Cal Fire has designated as a High or Very High Fire Hazard Severity Zone]. No assurance can be given as to the severity or frequency of wildfires within the vicinity of or in the District.

On January 16, 2025, Governor Gavin Newsom issued Executive Order N -10-25 (the “Governor’s Order”) which suspended penalties, costs and interest on overdue property taxes (including special taxes) within certain zip codes affected by the Palisades Fire dur ing calendar year 2025. In the event of a major fire or other natural disaster affecting the City or District, a similar order affecting the City or District could impact the collection of Special Taxes needed to make debt service payments for the Bonds.

In the event of a severe earthquake, fire, drought, flood or other natural disaster, there may be significant damage to both property and infrastructure in the District. As a result, a substantial portion of the property owners may be unable or unwilling to pay the Special Tax when due. In addition, the value of land in the District could be diminished in the aftermath of such a natural disaster, reducing the resulting proceeds of foreclosure sales in the event of delinquencies in the payment of the Special Tax..

Wind Risks. According to the Safety Element of the City’s General Plan, the City is subject to extremely high winds, which have resulted in significant property damage. For example, portions of roofs and block walls have been broken and blown away and public utility structures such as power lines and traffic signals have been damaged. The most significant wind problems occur at the canyon mouths and valleys extending downslope from the San Bernardino Mountains. The highest velocities are associated with downslope canyon and Santa Ana winds (90-100 mph). Santa Ana wind conditions are a reversal of the prevailing southwesterly winds and usually occur on a region-wide basis during late summer and early fall. Santa Ana winds are dry, warm winds that flow from the higher desert elevations in the north through the mountain passes and canyons. Of the major fires in the San Bernardino Mountains, all have occurred during periods of high winds. The high wind velocity and property damage potential have resulted in the northern half of the City adjacent to the mountains being classified by the City as a “High Wind Area.” In this area of the City, stringent conditions for the construction of buildings and public facilities are applied.

Hazardous Substances
The presence of hazardous substances on a parcel may result in a reduction in the value of a parcel. In general, the owners and operators of a parcel may be required by law to remedy conditions of the parcel relating to releases or threatened releases of hazardous substances. The Federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, sometimes referred to as “CERCLA” or the “Superfund Act,” is the most well-known and widely applicable of these laws, but California laws with regard to hazardous substances are also stringent and similar. Under many of these laws, the owner or operator is obligated to remedy a hazardous substance condition of property whether or not the owner or operator has anything to do with creating or handling the hazardous substance. The effect, therefore, should any of the taxed parcels be affected by a hazardous substance, is to reduce the marketability and value of the parcel by the costs of remedying the condition, because the purchaser, upon becoming owner, will become obligated to remedy the condition just as is the seller.

Further, it is possible that liabilities may arise in the future with respect to any of the parcels 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 wh ich 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

36 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 that is realizable upon a delinqu ency and the willingness or ability of the owner of any parcel to pay the Special Tax Installments.

The value of the taxable property within the District, as set forth in the various tables in this Official Statement, does not reflect the presence of any hazardous substance or the possible liability of the owner (or operator) for the remedy of a hazardou s substance condition of the property. The City has not independently verified, but is not aware, that any owner (or operator) of any of the parcels within the District has such a current liability with respect to any such parcel. It is possible, however, that such liabilities do currently exist and that the District is not aware of them.

Parity Taxes and Special Assessments
Property within the District is subject to taxes imposed by public agencies also having jurisdiction over the land within the District. See “THE DISTRICT — Estimated Direct and Overlapping Indebtedness.” The Special Taxes and any related penalties will constitute a lien against the lots and parcels of land on which they will be annually imposed until they are paid. Such lien is on a parity with all special taxes and special assessments levied by the City a nd other agencies and is co -equal to and independent of the lien for general property taxes regardless of when they are imposed upon the same property. The Special Taxes have priority over all existing and future private liens imposed on the property exce pt, possibly, for liens or security interests held by the Federal Deposit Insurance Corporation. See “RISK FACTORS — Bankruptcy and Foreclosure ” below.

The City has no control over the ability of other entities and districts to issue indebtedness secured by special taxes, ad valorem taxes or assessments payable from all or a portion of the property within the District.

In addition, the landowners within the District may, without the consent or knowledge of the City, petition other public agencies to issue public indebtedness secured by special taxes, ad valorem taxes or assessments. Any such special taxes, ad valorem taxes or assessments may have a lien on such property on a parity with the Special Taxes and could reduce the estimated value -to-lien ratios for property within the District described in this Official Statement. See “SOURCES OF PAYMENT FOR BONDS ” and “THE DISTRICT — Estimated Direct and Overlapping Indebtedness.”
Disclosures to Future Purchasers
The willingness or ability of an owner of a parcel to pay the Special Tax even if the value of the parcel is sufficient may be affected by whether or not the owner was given due notice of the Special Tax authorization at the time the owner purchased the parcel, was informed of the amount of the Special Tax on the parcel should the Special Tax be levied at the maximum tax rate and the risk of such a levy, and, at the time of such a levy, has the ability to pay it as well as pay other expenses and obligations . The City has caused the Notice of Special Tax Lien to be recorded in the Office of the Recorder for the County against each parcel. While title companies normally refer to such notices in title reports, there can be no guarantee that such reference wil l be made or, if made, that a prospective purchaser or lender will consider such Special Tax obligation in the purchase of a property within the District or lending of money thereon.

The Act requires the subdivider (or its agent or representative) of a subdivision to notify a prospective purchaser or long-term lessor of any lot, parcel, or unit subject to a Mello -Roos special tax of the existence and maximum amount of such special tax using a statutorily prescribed form. California Civil Code Section 1102.6b requires that in the case of transfers other than those covered by the above requirement, the seller must at least make a good faith effort to notify the prospective purchaser of the special tax lien in a format prescribed by statute.

Failure by an owner of the property to comply with the above requirements, or failure by a purchaser or lessor to

37 consider or understand the nature and existence of the Special Tax, could adversely affect the willingness and ability of the purchaser or lessor to pay the Special Tax when due.

Depletion of Reserve Fund
The Reserve Fund is to be maintained at an amount equal to the Reserve Requirement. Money in said fund may be used to pay debt service on the Bonds in the event the proceeds of the levy and collection of the Special Tax against property in the District ar e insufficient. If funds in the Reserve Fund are used to pay debt service on the Bonds, 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 pursuant to the Indenture. No replenishment from the proceeds of a levy of the Special Tax, however, can occur as long as the proceeds that are collected from the levy of the Special Tax at the maximum tax rates, together with other available funds, remain insufficient to pay all such amounts. Thus, it is possible that the Reserve Fund will be depleted by its use to pay such amounts and will not be replenished by the levy of the Special Tax. There is no assurance that the amount in the Reserve Fund will, a t any particular time, be sufficient to pay all such amounts or that any amounts of the Reserve Requirement used for debt service on the Bonds will be fully replenished from the proceeds of the levy and collection of the Special Tax.

Non-Cash Payments of Special Taxes
Under the Act, the City Council as the legislative body of the District may reserve to itself the right and authority to allow the owner of any taxable parcel to tender a Bond in full or partial payment of any installment of the Special Taxes or the interest or penalties thereon. A Bond so tendered is to be accepted at par and credit is to be given for any interest accrued thereon to the date of the tender. Thus, if Bonds can be purchased in the secondary market at a discount, it may be to the advantage o f an owner of a taxable parcel to pay the Special Taxes applicable thereto by tendering a Bond. Such a practice would decrease the cash flow available to the City to make payments with respect to other Bonds then outstanding; and, unless the practice was limited by the City, the Special Taxes paid in cash could be insufficient to pay the debt service due with respect to such other Bonds.

In order to provide some protection against the potential adverse impact on cash flows, which might be caused by the tender of Bonds in payment of Special Taxes, the Fiscal Agent Agreement includes a covenant pursuant to which the City will not authorize owners of taxable parcels to satisfy Special Tax obligations by the tender of Bonds unless the City shall have first obt ained a report of an Independent Financial Consultant certifying that doing so would not result in the City having insufficient Special Tax Revenues to pay the principal of and interest on all Outstanding Bonds when due.

Payment of the Special Tax Is Not a Personal Obligation of the Owners An owner of a taxable parcel is not personally obligated to pay the Special Tax. Rather, the Special Tax is an obligation which is secured only by a lien against the taxable parcel. If the value of a taxable parcel is not sufficient, taking into account other liens imposed by public agencies, to secure fully the Special Tax, the City has no recourse against the owner.

Concentration of Ownership
Based on development and ownership status as of the Date of Value, the Developer is expected to be responsible for approximately 53.51% of the projected Fiscal Year 2026-27 Special Tax levy, while the individual homeowners are expected to be responsible for 46.49% of the projected Fiscal Year 2026-27 Special Tax levy.

See Table 4 herein.

The timely payment of principal of and interest on the Bonds depends upon the willingness and ability of the current and future property owners in the District to pay the Special Taxes prior to delinquency. General and local economic conditions and governmental requirements or restrictions may affect the willingness of the current property owners, or any successor property owners, to pay the Special Taxes, and there is no assurance that the

38 current property owners, or any successor property owners, will pay such Special Taxes even if financially able to do so. Due to the concentration of ownership of the property, a failure by the Developer or any successor property owner thereto to pay the Special Taxes may result in a default in the payment of debt service on the Bonds.

Land Values
The value of the Property is a critical factor in determining the investment quality of the Bonds. If a property owner is delinquent in the payment of Special Taxes, the District ’s only remedy is to commence foreclosure proceedings against the delinquent parcel in an attempt to obtain funds to pay the Special Taxes.

Reductions in property values due to a downturn in the economy, physical events such as earthquakes, fires or floods, stricter land use regulations, delays in development or other events will adversely impact the security underlying the Special Taxes. See “THE DISTRICT — Appraisal Report” and APPENDIX B — “APPRAISAL REPORT.”
Prospective purchasers of the Bonds should not assume that the taxable land within the District could be sold for the appraised or assessed amount at a foreclosure sale for delinquent Special Taxes. In arriving at the estimate of market value, the Appraiser assumes that any sale will be unaffected by undue stimulus and will occur following a reasonable marketing period, which is not always p resent in a foreclosure sale. See APPENDIX B for a description of other assumptions made by the Appraiser and for the definitions and limiting conditions used by the Appraiser. Any event which causes one of the Appraiser ’s assumptions to be untrue could result in a reduction of the value of the taxable land and improvements within the District from the market value estimated by the Appraiser.

No assurance can be given that any bid will be received for a parcel with delinquent Special Taxes offered for sale at foreclosure or, if a bid is received, that such bid will be sufficient to pay all delinquent Special Taxes.

See “SOURCES OF PAYMENT FOR THE BONDS — Special Taxes — Proceeds of Foreclosure Sales.” Mortgage Interest Rates
Increases in mortgage interest rates could have a negative impact on the estimated absorption rates of the planned for -sale residential units in the District described herein. With respect to entry -level households, increased mortgage interest rates may a dversely impact the affordability of homes and may increase mortgage payment levels for owning a lower -priced home relative to renting a residence, thereby making purchasing less attractive. With respect to move-up households, higher mortgage interest rates may impact the desire of current homeowners to move from their present home due to the fact that their present home likely has a relatively low mortgage interest rate. In addition, the new home would likely have a higher interest rate on a new mortgage loan as well as higher purchase price and property taxes. Such considerations may decrease the desire for move -up households to purchase a new home. Any future increases or decreases in mortgage interest rates cannot be predicted.

Exempt Properties
Certain properties are exempt from the Special Tax in accordance with the Rate and Method. In addition, the Act provides that properties or entities of the State, federal or local government are exempt from the Special Tax; provided, however, that property in 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, 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.

39 In particular, insofar as the Act requires payment of the Special Tax by a federal entity acquiring property in the District, it may be unconstitutional. If for any reason property in the District becomes exempt from taxation by reason of ownership by a nontaxable entity such as the federal government or another public agency, subject to the limitation of the maximum authorized rates, the Special Tax will be reallocated to the remaining Taxable Properties in the District. This would result in the owners of such property paying a greater amount of the Special Tax and could have an adverse impact upon the timely payment of the Special Tax. Moreover, if a substantial portion of property in the District becomes exempt from the Special Tax because of public ow nership, or otherwise, the Maximum Annual Special Tax which could be levied upon the remaining acreage might not be sufficient to pay principal of and interest on the Bonds when due and a default would occur with respect to the payment of such principal and interest.

Impact of Economic Conditions on the Development in the District Certain events and factors which negatively affect the regional, State and national economies could have an adverse effect on the pace at which the Developer can complete future homes, and demand by, and the ability of individuals to purchase homes within the District. Such events and factors could include rising inflation and interest rates, persistent supply chain issues, pandemics and global market instability caused by the war and other hostilities. Any adverse impact of the foregoing and other economic factors on the project in the District and the real estate market in general cannot be predicted.

FDIC/Federal Government Interests in Properties
The ability of the District to collect interest and penalties specified by the Act and to foreclose the lien of delinquent Special Tax may be limited in certain respects with regard to parcels in which the Federal Deposit Insurance Corporation (the “FDIC”) , or other federal government entities such as Fannie Mae or Freddie Mac, has or obtains an interest.

In the case of the FDIC, in the event that any financial institution making a loan which is secured by parcels is taken over by the FDIC and the applicable Special Tax is not paid, the remedies available to the District may be constrained. The FDIC’s poli cy statement regarding the payment of state and local real property taxes (the “Policy Statement”) provides that taxes other than ad valorem taxes which are secured by a valid lien in effect before the FDIC acquired an interest in a property will be paid unless the FDIC determines that abandonment of its interests is appropriate. The Policy Statement provides that the FDIC generally will not pay installments of non-ad valorem taxes which are levied after the time the FDIC acquires its fee interest, nor will the FDIC recognize the validity of any lien to secure payment except in certain cases where the Resolution Trust Corporation had an interest in property on or prior to December 31, 1995. Moreover, the Policy Statement provides that, with respect to parcels on which the FDIC holds a mortgage lien, the FDIC will not permit its lien to be foreclosed out by a taxing authority without its specific consent, nor will the FDIC pay or recognize liens for any penalties, fines or similar claims imposed for the nonpayment of taxes.

The FDIC has taken a position similar to that expressed in the Policy Statement in legal proceedings brought against Orange County, California, in United States Bankruptcy Court and in Federal District Court. The Bankruptcy Court issued a ruling in favor of the FDIC on certain of such claims. Orange County appealed that ruling, and the FDIC cross -appealed. On August 28, 2001, the Ninth Circuit Court of Appeals issued a ruling favorable to the FDIC except with respect to the payment of pre-receivership liens based upon delinquent property tax.

The District is unable to predict what effect the application of the Policy Statement would have in the event of a delinquency with respect to parcels in which the FDIC has or obtains an interest, although prohibiting the lien of the FDIC to be foreclosed out at a judicial foreclosure sale would prevent or delay the foreclosure sale.

In the case of Fannie Mae and Freddie Mac, in the event a parcel of Taxable Property is owned by a federal government entity or federal government sponsored entity, such as Fannie Mae or Freddie Mac, or in the

40 event a private deed of trust secured by a parcel of Taxable Property is owned by a federal government entity or federal government sponsored entity, such as Fannie Mae or Freddie Mac, the ability to foreclose on the parcel or to collect delinquent Special Tax may be limited. 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 assessment s if foreclosure would impair the federal government interest. This means that, unless Congress has otherwise provided, if a federal government entity owns a parcel of Taxable Property but does not pay taxes and assessments levied on the parcel (including the Special Tax), 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 District wishes to foreclose on the parcel as a result of delinquent Special Tax, the property cannot be sold at a foreclosure sale un less it can be sold for an amount sufficient to pay delinquent taxes and assessments on a parity with the Special Tax and preserve the federal government’s mortgage interest.

The District’s remedies may also be limited in the case of delinquent Special Tax with respect to parcels in which other federal agencies (such as the Internal Revenue Service and the Drug Enforcement Administration) have or obtain an interest.

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

Although bankruptcy proceedings would not cause the Special Taxes to become extinguished, bankruptcy of a property owner 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 Bonds. To the extent that property in the District continues to be owned by a limited number of property owners, the chances are increased that the Reserve Fund could be fully depleted during any such delay in obtaining payment of delinquent Special Taxes.

As a result, sufficient moneys would not be available in the Reserve Fund for transfer to the Deb t Service Fund or the Redemption Fund to make up shortfalls resulting from delinquent payments of the Special Tax and thereby to pay principal of and interest on the Bonds on a timely basis.

To the extent that bankruptcy or similar proceedings were to involve a large property owner, the chances would increase the likelihood that 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 Reserve Fund for transfer to the Redemption Fund to make up any shortfalls resulting from delinquent payments of the Special Tax and thereby to pay principal of and interest on the Bonds on a timely basis.

On July 30, 1992, the United States Court of Appeals for the Ninth Circuit issued its opinion in a bankruptcy case entitled In re Glasply Marine Industries . In that case, the court held that ad valorem property taxes levied by Snohomish County in the State of Washington after the date that the property owner filed a petition for bankruptcy were not entitled to priority over a secured creditor with a prior lien on that property. The court upheld the priority of unpaid ad valorem property 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

41 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 property taxes.

Glasply was controlling precedent on bankruptcy courts in the State 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 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. The Glasply holding, however, was for the most part subsequently rendered inoperative with respect to the imposition of a lien for and the collection of ad valorem property 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 latter 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 annua lly. As noted above, special taxes have a different lien date than the lien date for general ad valorem property taxes in the State 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 property taxes. Thus, in deciding whether the original Glasply ruling is applicable to a bankruptcy proceeding involving special taxes rather than gen eral 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 the District 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 property taxes, and, therefore, the exemption from the automatic stay in Sectio n 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 property taxes.” No Acceleration Provision
The Bonds do not contain a provision allowing for the acceleration of the Bonds in the event of a payment default or in the event interest on the Bonds becomes included in gross income for federal income tax purposes.

See “— Limitations on Remedies” below.

42 Loss of Tax Exemption
As discussed under the caption “LEGAL MATTERS — Tax Matters,” the interest on the Bonds could become includable in gross income for federal income tax purposes retroactive to the date of issuance of the Bonds as a result of a failure of the City to comply with certain provisions of the Internal Revenue Code o f 1986, as amended (the “Code”). Such an event of taxability would not in and of itself result in an early redemption of the Bonds and the Bonds will remain outstanding to maturity or until redeemed under the redemption provisions of the Fiscal Agent Agreement.

Limitations on Remedies
Remedies available to the owners of the Bonds may be limited by a variety of factors and may be inadequate to assure the timely payment of principal of and interest on the Bonds or to preserve the tax -exempt status of the Bonds.

Bond Counsel has limited its opinion as to the enforceability of the Bonds and of the Fiscal Agent Agreement to the extent that enforceability may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer, moratorium, or other similar laws affecting generally the enforcement of creditors’ rights, by equitable principles and by the exercise of judicial discretion. The lack of availability of certain remedies or the limitation of remedies may entail risks of delay, limitation or modification of the rights of the owners of the Bonds.

Limited Secondary Market
There can be no guarantee that there will be a secondary market for the Bonds or, if a secondary market exists, that such Bonds can be sold for any particular price. Although the City has committed to provide certain financial and operating information on an annual basis, there can be no assurance that such information will be available to Bond owners on a timely basis. See “CONTINUING DISCLOSURE.” The failure to provide the required annual financial information does not give rise to monetary damages but merely an action for specific performance. Occasionally, because of general market conditions, lack of current information, or because of adverse history or economic prospects connected with a particular issue, secondary marketing practices in connection with a particular issue are suspended or terminated. Additionally, prices of issues for which a market is being made will depend upon then prevailing circumstances. Such prices could be substantially different from the original purchase price.

Constitutional Limitations on Taxation and Appropriations Articles XIIIA and XIIIB of the California Constitution. On June 6, 1978, California voters approved an amendment to the California Constitution, commonly known as Proposition 13 (the Jarvis/Gann Initiative), which added Article XIIIA to the California Constitution. The effect of Article XIIIA is to significantly limit the imposition of new ad valorem taxes, special taxes, transaction taxes, and sales taxes. On November 7, 1978, California voters approved Proposition 8, which made certain clarifications to Article XIIIA.

Article XIIIA of the California Constitution limits the amount of ad valorem taxes on real property to 1% of “full cash value” as determined by the county assessor. Article XIIIA defines “full cash value” to mean “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” is subject to annual adjustment to reflect increases, not to exceed 2% per year, or decreases in the consumer price index or comparable local data, or to reflect reductions in 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 allows local governments 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

43 or improvement of real property and approved by two-thirds of the votes cast by the qualified electorate. Article XIIIA requires a vote of two -thirds of the qualified electorate to impose special taxes on real property, while otherwise generally precluding the imposition of any additional ad valorem taxes, special taxes, transaction taxes, and sales taxes. In addition, Article XIIIA requires the approval of two -thirds of all members of the California Legislature to change any State laws resulting in increased tax revenues.

Enactment of Article XIIIA has reduced the amount of general property tax revenues received by the City.

This reduction in such revenues makes it less likely that the City or the District will have surplus funds, other than the Reserve Fund for the Bonds, with which to advance funds to make any payments or to cure any deficiency in the Interest Account or Principal Account of the Special Tax Fund, should the City or the District, as applicable, in the exercise of its discretion, choose to do so. If there are additional delinquencies after exhaustion of funds in the Reserve Fund for the Bonds, none of the City or the District has any obligation to transfer into the Interest Account or Principal Account of the Special Tax Fund the amount of any such delinque ncies out of any surplus moneys of the City.

On July 2, 1979, the Fifth District Court of Appeal rendered a 3-0 decision in the case of County of Fresno v. Malmstrom (94 Cal.App.3d 974), that determined that special assessments are not subject to the limitations of Article XIIIA (Proposition 13). The Court held the one percent tax limitation imposed by California Constitution Article XIIIA on ad valorem taxes does not apply to special assessments levied pursuant to the Improvement Act of 1911 (Streets and Highways Code, Section 5000 et seq., the relevant portions of which are incorporated in the 1915 Act) and the 1913 Act. The Court further held that because special assessments pursuant to such acts are not within the definition of “special taxes” in Article XIIIA, the Constitution does not require t he levy of assessments and the issuance of bonds to be approved by a two -thirds vote of the qualified electors in an assessment district. On September 12, 1979, the California Supreme Court refused to hear an appeal of the lower court’s decision.

At the November 6, 1979, general election, Proposition 4 (the Gann Initiative) was approved by the voters of California. Such proposition added Article XIIIB to the California Constitution.

Article XIIIB of the California Constitution limits the annual appropriations of the State and of any city, county, school district, authority, or other political subdivision of the State to the level of appropriations of the particular governmental entity for the prior fiscal year, as adjusted for changes in the cost of living, population and services rendered by the governmental entity. The “base year” for establishing such appropriation limit is the Fiscal Year 1978-79 and the limit is to be adjusted annually to reflect changes in population, consumer prices and certain increases in the cost of services provided by these public agencies.

Appropriations subject to Article XIIIB generally include the proceeds of taxes levied by the State or other entity of local government, exclusive of certain State subventions, refunds of taxes, benefit payments from retirement, unemployment insurance, and disability insurance funds. “Proceeds of taxes” include, but are not limited to, all tax revenues and the proceeds to an entity of government from (i) regulatory licenses, user charges, and user fees (but only to the extent such proceeds exceed the cost of providing the service or regulation), and (ii) the investment of tax revenues. Article XIIIB includes a requirement that if an entity’s revenues in any year exceed the amounts permitted to be spent, the excess would have to be allocated to fund schools or be returned by revising tax rates or fee schedules over the subsequent two years.

On December 17, 1980, the Third District Court of Appeal rendered a 3-0 decision in the case County of Placer v. Corin (113 Cal. App. 3d 443) that determined that special assessments are not subject to the limitation of Article XIIIB (Proposition 4). The Court held that the definition of “proceeds of taxes” imposed by California Constitution Article XIIIB does not apply to special assessments and improvement bonds issued pursuant to the 1915 Act and the 1913 Act. The decision of the Court was not appealed.

The enactment of Article XIIIA of the California Constitution (Proposition 13) and subsequent legislative enactments effectively repeal the otherwise mandatory duty on the part of the City, under the 1915 Act, to levy

44 and collect a special tax (in an amount necessary to meet delinquencies, but not to exceed ten cents on each $100 of assessable property within the City in any one year) if other funds are not available to cover delinquencies.

In early 1990, the U.S. Supreme Court struck down as a violation of equal protection certain property tax assessment practices in West Virginia, which had resulted in vastly different assessments of similar properties.

Since Article XIIIA provides that pr operty may only be assessed up to 2%, per year, except upon change of ownership or new construction, recent purchasers may pay substantially higher property taxes than long -time owners of comparable property in a community. The Supreme Court in the West Virginia case expressly declined to comment in any way on the constitutionality of Article XIIIA.

Based on this decision, however, property owners in California brought three suits challenging the acquisition value assessment provisions of Article XIIIA. Two cases involve residential property and one case involves commercial property. In all three cases, State trial and appellate courts have upheld the constitutionality of Article XIIIA’s assessment rules and concluded that the West Virginia case did not apply to California’s laws.

On June 3, 1991, the U.S. Supreme Court agreed to hear the appeal in the challenge relating to commercial property, but the plaintiff subsequently decided to drop the case.

On October 7, 1991, the U.S. Supreme Court granted the plaintiff’s petition for a writ of certiorari and agreed to hear the Nordlinger v. Lynch case. On June 18, 1992, the U.S. Supreme Court affirmed the Nordlinger decision (112 U.S. 2326) of the California Court of Appeal, Second Appellate District, which previously held that Article XIIIA does not violate the U.S. Constitution.

The City cannot predict whether any other pending or future challenges to the State’s present system of property tax assessment will be successful, when the ultimate resolution of any challenge will occur, or the ultimate effect any decision regarding the State’s present system of property tax assessment will have on the City’s revenues or on the State’s financial obligations to local governments.

Articles XIIIC and XIIID of the California Constitution. Proposition 218, a state ballot initiative known as the “Right to Vote on Taxes Act,” was approved by California voters on November 6, 1996. Proposition 218 added Articles XIIIC and XIIID to the State Constitution, and, with the exception of certain pr ovisions, Articles XIIIC and XIIID became effective on November 6, 1996.

Among other things, Proposition 218 imposed certain voting requirements and other limitations on the imposition of new or increased taxes, assessments, and property-related fees and charges. Under Proposition 218 (i) all taxes imposed by local governments are deemed to be either general taxes, or special taxes, (ii) no local government may impose, extend, or increase any general tax unless and until such tax is submitted to the electorate and approved by a majority vote, and (iii) no local government may i mpose, extend, or increase any special tax unless and until such tax is submitted to the electorate and approved by a two -thirds vote. Special purpose districts, including community facilities districts and assessment districts, have no power to levy gene ral taxes.

The City believes that the issuance of the Bonds does not require the conduct of further proceedings under the Mello-Roos Act, or Proposition 218, as applicable, other than as described herein.

Proposition 218 provides that the initiative power shall “not be prohibited or otherwise limited in matters reducing or repealing any local tax, assessment, fee or charge...” Thus, Proposition 218 removes limitations on the initiative power in matters of, among other things, the Special Tax. Consequently, it is conceivable that the voters of the City or the District could, by future initiative, repeal, reduce, or prohibit the future imposition or increase of any Special Tax, subject to overriding federal constitutional principles relating to impairment of contracts.

Although the provisions of Article XIIIC have not been interpreted by the courts, the City believes that the initiative power cannot be used to reduce or repeal the unpaid Special Tax that are pledged as security for payment of the Bonds or to otherwise in terfere with the mandatory, statutory duty of the City and the County Auditor with respect to the unpaid Special Tax that are pledged as security for payment of the Bonds.

45 The interpretation and application of Proposition 218 will ultimately be determined by the courts with respect to a number of the matters discussed above, and it is not possible at this time to predict with certainty the outcome of such determination.

Voter Initiatives
From time to time constitutional initiatives or other initiative measures may be adopted by California voters. The adoption of any such initiative might place limitations on the ability of the State or any political subdivision thereof, including the City, to increase revenues or to increase appropriations, or might affect the ability of the District to collect the Special Tax.

The City cannot predict whether legislation will be enacted into law by the California state legislature. If future legislation were to be enacted, the City cannot provide any assurances as to the effect of the implementation or judicial interpretations thereof on the finances of the State, the City, or the District.

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

Litigation with Respect to Community Facilities Districts Shapiro. With respect to the approval of the Special Taxes, on August 1, 2014, the California Court of Appeal, Fourth Appellate District, Division One, issued its opinion in City of San Diego v. Melvin Shapiro, et al. (D063997) (the “San Diego Decision”). The case involved a Convention Center Facilities District (the “CCFD”) established by the City of San Diego (“San Diego”). The CCFD is a financing district much like a community facilities district established under the provisions of the Act. The CCFD is comp rised of all of the real property in San Diego. The special tax to be levied within the CCFD, however, was to be levied only on hotel properties located within the CCFD.

The election authorizing the special tax was limited to owners of hotel properties and lessees of real property owned by a governmental entity on which a hotel is located. Thus, the election was not a registered voter election. Such approach to determini ng who would constitute the qualified electors of the CCFD was modeled after Section 53326(c) of the 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 district whose property would be subject to the special tax. The Court held that the CCFD special tax election was invalid under the California Constitution because Article XIIIA, Section 4 thereof and Article XIIIC, Section 2 thereof require that the electors in such an election be the registered voters within the district.

The facts of the San Diego Decision show that there were thousands of registered voters within the CCFD (viz., all of the registered voters in San Diego). The election held in the District had no registered voters within the District at the time of the election to authorize the Special Tax. In the San Diego Decision, the Court expressly stated that it was not addressing the validity of landowner voting to impose special taxes pursuant to the Act in situations where there are fewer than 12 registered voters. Thus, by its terms, the Court’s holding does not apply to the Special Tax election in the District.

Horizon. The Sacramento County Superior Court had issued a ruling in Horizon Capital Investments, LLC v. City of Sacramento et al . (Case No. 34-2017-80002661). As described below, this case involved an election to approve the levy of a special tax within a community facilities district (“CFD”) formed under the Act.

In 2017, the City of Sacramento initiated proceedings to form a CFD to finance certain costs to operate and maintain a streetcar line. As permitted by the Act, the proposed district included non -contiguous parcels of

46 non-residential property. Because there were fewer than 12 registered voters residing within the territory of the proposed CFD, the City Council submitted the special tax proposed to be levied within the proposed CFD to the owners of land within the proposed CFD, as required by the Act. The proposed special tax received the requisite two-thirds vote in the landowner election.

Petitioners Horizon Capital Investments, LLC et al. filed a writ of mandate and complaint for reverse validation and declaratory relief. Petitioners argued, and the superior court agreed in its final ruling, that under section 4(a) of article XIII A of the California Constitution (which provides that “Ci ties, Counties and special districts, by a two -thirds vote of the qualified electors of such district [sic], may impose special taxes on such district…”) the phrase “qualified electors” means the registered voters of the entire City of Sacramento and not just the owners of the property within the boundaries of the proposed CFD. Citing the San Diego Decision, the tentative ruling states that the phrase “qualified electors of the district” refers to the registered voters of the entity imposing the special tax, which in this case was the City of Sacramento. Because the vote within the proposed CFD was by landowners only and not by all registered voters in the City of Sacramento, the final ruling states that the special tax is invalid.

The superior court’s final ruling is not binding upon other courts within the State and does not directly apply to the District, the Special Taxes, or the Bonds. The City of Sacramento did not appeal the superior court’s ruling.

Potential Early Redemption of Bonds from Prepayments or Assessment Bond Proceeds Property owners within the District, including the Developer and any individual property owner, are permitted to prepay their Special Taxes 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 prepa yment. The resulting redemption of Bonds that were purchased at a price greater than par could reduce the otherwise expected yield on such Bonds.

See the caption “THE BONDS — Redemption.”
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 the District may also be adversely affected by the application of laws protecting endangered or threatened species.

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. To date, the City has not experienced a material threat to its computer operating system. No assurance, however, 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 District, or the administration of the Bonds.

The City is also reliant on other entities and service providers in connection with the administration of Bonds, including without limitation the County tax collector for the levy and collection of Special Taxes, the Fiscal Agent, and the dissemination age nt. In April of 2023 the County Sheriff Department’s computer system was hacked, resulting in the encryption of files, the disruption of systems and blocked access to data. The County paid a $1.1 million ransom to the hackers in order to restore the system to its full functionality and to secure data.

47 Although the cyberattack did not impact the County’s tax collector, no assurance can be given that the City, the County and other entities will not be affected by cyber threats and attacks in a manner that may affect the Bond Owners.

CONTINUING DISCLOSURE
City Continuing Disclosure
Pursuant to the City Continuing Disclosure Certificate, the City will agree to provide, or cause to be provided, to the EMMA system of the Municipal Securities Rulemaking Board, which can be found on the Internet at www.emma.msrb.org, on an annual basis ce rtain financial information and operating data concerning the District and to provide notices of the occurrence of certain listed events as required by the Rule. This covenant is being made by the City in order to assist the Underwriter in complying with the Rule.

The City and its related entities have previously entered into continuing disclosure undertakings under the Rule in connection with the issuance of municipal obligations. In the last five years, with respect to the $55,800,000 San Bernardino Joint Powers Financing Authority Tax Allocation Revenue Refunding Bonds, Series 2005A, the City did not timely file audited financial statements for Fiscal Year 2020-21 and the annual report for Fiscal Year 2020 -21 [MORE TO COME] . [The City has remedied and filed the ne cessary information and is current in its continuing disclosure obligations.]
Developer Continuing Disclosure
Although the Developer is not considered to be an obligated person under the Rule, the Developer has agreed to enter into a Developer Continuing Disclosure Certificate in connection with the issuance of the Bonds, pursuant to which it will provide semi -annual reports containing up dated information with respect to the development within the District. Pursuant to the Developer Continuing Disclosure Certificate, the Developer will provide semi-annual reports not later than April 1 and September 30 of each year beginning September 30, 2026, until satisfaction of certain conditions set forth in the Developer Continuing Disclosure Certificate. The semi - annual reports to be provided by the Developer will contain updates regarding the development within the District as outlined in Section 4 of the Developer Continuing Disclosure Certificate attached as APPENDIX E. In addition to its semi-annual reports, the Developer will agree to provide notices of certain events set forth in the Developer Continuing Disclosure Certificate.

The Developer’s obligations under the Developer Continuing Disclosure Certificate will terminate upon the earliest to occur of (a) the legal defeasance, prior redemption or payment in full of all of the Bonds, or (b) the date on which the Developer owns all or a portion of the property that represents less than 20% of the aggregate special tax obligation.

None of the District, the City or the Fiscal Agent is a party to the Developer Continuing Disclosure Certificate, and none of the District, the City or the Fiscal Agent has any obligation or responsibility to monitor, nor any right or obligation to enforce, compliance by the Developer with its undertaking pursuant to the Developer Continuing Disclosure Certificate, and none of the District, the City or the Fiscal Agent will be so monitoring or enforcing such compliance.

Developer Continuing Disclosure Compliance . [To the actual k nowledge of the Developer, the Developer has not failed to comply in any material respects with its previous undertakings by it to provide periodic continuing disclosure reports or notices of listed events with respect to payment of special taxes and assessments with respect to community facilities districts or assessment districts in California within the past five years.]

48 LEGAL MATTERS
Tax Matters
In the opinion of Best Best & Krieger LLP, Riverside, California, subject, however, to certain qualifications described in this Official Statement, under existing statutes, regulations, rulings and judicial decisions, and assuming the accuracy of certain r epresentations and compliance with certain covenants, the interest on the Bonds is excluded from gross income for federal income tax purposes, and interest on the Bonds is not an item of tax preference for purposes of calculating the federal alternative mi nimum tax imposed on individuals and corporations; however, interest on the Bonds is taken into account in determining the annual adjusted financial statement income of certain corporations for the purpose of computing the alternative minimum tax imposed o n certain corporations. In the further opinion of Bond Counsel, interest on the Bonds is exempt from California personal income tax.

The opinions set forth in the preceding paragraph are subject to the condition that the District and City comply with all requirements of the Tax Code that must be satisfied subsequent to the issuance of the Bonds. The District and City have made certain r epresentations and covenanted to comply with each such requirement.

Inaccuracy of these representations or failure to comply with these covenants may result in interest on the Bonds being included in gross income for federal income tax purposes, possibly from the date of original issuance of the Bonds. The opinion of Bond Counsel assumes the accuracy of these representations and compliance with these covenants. Bond Counsel has not undertaken to determine (or to inform any person) whether any actions tak en (or not taken), or events occurring (or not occurring), or any other matters coming to Bond Counsel’s attention after the date of issuance of the Bonds may adversely affect the value of, or the tax status of interest on, the Bonds.

Accordingly, the opinion of Bond Counsel is not intended to, and may not, be relied upon in connection with any such actions, events, or matters.

If the initial offering price to the public (excluding bond houses and brokers) at which a Bond is sold is less than the amount payable at maturity thereof, then such difference constitutes “original issue discount” for purposes of federal income taxes and State of California personal income taxes. If the initial offering price to the public (excluding bond houses and brokers) at which a Bond is sold is greater than the amount payable at maturity thereof, then such difference constitutes “original issue premium” for purposes of federal income taxes and State of California personal income taxes. De minimis original issue discount and original issue premium is disregarded.

Under the Tax Code, original issue discount is treated as interest excluded from federal gross income and exempt from State of California personal income taxes to the extent properly allocable to each owner thereof subject to the limitations described in the first paragraph of this section. The original issue discount accrues over the term to maturity of the Bond on the basis of a constant interest rate compounded on each interest or principal payment date (with straight -line interpolations between compound ing dates). The amount of original issue discount accruing during each period is added to the adjusted basis of such Bonds to determine taxable gain upon disposition (including sale, prepayment, or payment on maturity) of such Bond. The Tax Code contains c ertain provisions relating to the accrual of original issue discount in the case of purchasers of the Bonds who purchase the Bonds after the initial offering of a substantial amount of such maturity. Owners of such Bonds should consult their own tax advisors with respect to the tax consequences of ownership of Bonds with original issue discount, including the treatment of purchasers who do not purchase in the original offering, the allowance of a deduction for any loss on a sale or other disposition, and th e treatment of accrued original issue discount on such 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 Bond (said term being the shorter of the bond’s maturity date or its call date). The amount of original issue premium amortized each year reduces the adjusted basis of the owner of the Bond for purposes of determining taxable gain or loss upon disposition. The amount of original issue premium on a Bond is amortized each year over the term to maturity of the Bond on the basis of a constant interest rate compounded on each interest or principal payment date (with straight-line interpolations between compounding dates). Amortized Bond premium is not deductible

49 for federal income tax purposes. Owners of premium Bonds, including purchasers who do not purchase in the original offering, should consult their own tax advisors with respect to State of California personal income tax and federal income tax consequences of owning such Bonds.

Current and future legislative proposals, if enacted into law, clarification of the Tax Code, or court decisions may cause interest with respect to the Bonds to be subject, directly or indirectly, to federal income taxation or to be subject to or exempted from state income taxation, or otherwise prevent beneficial owners from realizing the full current benefit of the tax status of such interest. The introduction or enactment of any such legislative proposals, clarification of the Tax Code, or court decision s may also affect the market price for, or marketability of, the Bonds. Prospective purchasers of the Bonds should consult their own tax advisors regarding any pending or proposed federal or state tax legislation, regulations or litigation, as to which Bon d Counsel expresses no opinion.

The opinion of Bond Counsel is based on current legal authority, covers certain matters not directly addressed by such authorities, and represents Bond Counsel’s judgment as to the proper treatment of the Bonds for federal income tax purposes. It is not b inding on the Internal Revenue Service (“IRS”) or the courts.

Furthermore, Bond Counsel cannot give and has not given any opinion or assurance about the future activities of the District or City or about the effect of future changes in the Tax Code, the a pplicable regulations, the interpretation thereof or the enforcement thereof by the IRS. The District and City have covenanted, however, to comply with the requirements of the Tax Code.

A copy of the proposed form of opinion of Bond Counsel is attached hereto as APPENDIX F.

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

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

Legal Opinion
The legal opinion of Bond Counsel, approving the validity of the Bonds in substantially the form set forth as APPENDIX F, will be made available to the original purchaser at the time of original delivery. A copy of the legal opinion for the Bonds will be provided with each definitive bond. Certain legal matters will be passed upon for the City and the District by Best Best & Krieger LLP, Riverside, California , as the City Attorney and as Disclosure Counsel, and for the Underwriter by Kutak Rock, LLP, as counsel to the Underwriter.

Litigation
The District is not aware of any significant pending legislation which would have material adverse consequences on the Bonds or the ability of the District to pay the principal of and interest on the Bonds when due.

50 CONCLUDING MATTERS
No Rating
The District has not made and does not contemplate making application to any rating agency for the assignment of a rating of the Bonds.

Underwriting
The Bonds are being purchased by Hilltop Securities Inc. (the “Underwriter”). The Underwriter has agreed to purchase the Bonds at a price of $_________ (being $______ aggregate principal amount thereof, less Underwriter’s discount of $ _______ and [plus] [net] original issue [premium] of $ ______). The purchase agreement relating to the Bonds provides that the Underwriter will purchase all of the Bonds if any are purchased.

The obligation to make such purchase is subject to certain terms and conditions set forth in such purchase agreement, the approval of certain legal matters by counsel and certain other conditions.

Under certain circumstances, the Underwriter may offer and sell the Bonds to certain dealers and others at prices lower or yields greater than the offering prices or yields stated on the inside cover page of this Official Statement. The offering prices or yields may be changed from time to time by the Underwriter.

Municipal Advisor
The District has retained Urban Futures, Inc., Walnut Creek, California, as municipal advisor (the “Municipal Advisor”) for the sale of the Bonds. The Municipal Advisor is not obligated to undertake, and has not undertaken to make, an independent verifica tion or to assume any responsibility for the accuracy, completeness or fairness of the information contained in this Official Statement.

Urban Futures, Inc. is an independent advisory firm and is not engaged in the business of underwriting, trading or distributing municipal or other public securities.

Financial Interests
The fees being paid to the Municipal Advisor, the Underwriter and Underwriter’s Counsel are contingent upon the issuance and delivery of the Bonds. From time to time, Bond Counsel and Disclosure Counsel represent the Underwriter on matters unrelated to the Bonds.

Additional Information
The purpose of this Official Statement is to supply information to prospective buyers of the Bonds.

Quotations and summaries and explanations of the Bonds and documents contained in this Official Statement do not purport to be complete, and reference is m ade to such documents for full and complete statements and their provisions.
(Balance of this page intentionally left blank.)

51 The execution of this Official Statement by the City Manager of the City and the delivery thereof have been duly authorized by the City Council acting in its capacity as the legislative body of the District.

THE CITY OF SAN BERNARDINO
By:

City Manager of the City of San Bernardino

A-1

APPENDIX A

RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX

B-1

APPENDIX B

APPRAISAL REPORT

C-1

APPENDIX C

SUPPLEMENTAL INFORMATION CONCERNING

CITY OF SAN BERNARDINO AND COUNTY OF SAN BERNARDINO
The Bonds will not be secured by any pledge of ad valorem taxes or City General Fund revenues but will be payable solely from Special Taxes to levied on and collected from the owners of certain taxable land within the District. The information set forth below is included in the Official Statement for background purposes only.

General Description and Background
Incorporated in 1854, the City of San Bernardino (the “City”) is a charter city that functions under a Council-Manager form of government. The governance structure is comprised of an at-large elected Mayor and seven Council Members elected by constituents in the specific ward. Each elected official serves a four-year term.

San Bernardino County (the “County”), which encompasses 20,105 square miles, is the largest county in the contiguous United States. On April 26, 1853, the County was created from parts of Los Angeles, San Diego and Mariposa Counties. Located in the southeastern portion of California, the County is bordered on the south by Riverside County, on the east by the State of Arizona and Nevada, on the north by Inyo and Tulare Counties, and on the west by Los Angeles and Kern Counties. There are 24 incorporated cities in the County.

The County’s varying topology includes desert, valley and mountain areas as well as gently rolling terrain.

Three distinct geographical areas characterize the County: the valley region, the mountain region and the desert region. The valley region contains the majority of the County ’s incorporated areas and is the most populous region. The mountain region is primarily comprised of public lands owned and managed by federal and state agencies. The desert region is the largest region and includes parts of the Mojave Desert.

Population
The following sets forth the City, the County and the State population estimates as of Janua ry 1, for the years 2017 to 2026:

CITY OF SAN BERNARDINO, SAN BERNARDINO COUNTY AND CALIFORNIA Population
Year(1) City of San Bernardino County of San Bernardino State of California 2017 221,372 2,142,339 39,273,915
2018 221,918 2,153,258 39,426,439
2019 222,140 2,169,538 39,503,656
2020(2) 223,120 2,181,654 39,538,223
2021 221,763 2,184,048 39,380,058
2022 220,657 2,182,080 39,159,480
2023 219,860 2,177,507 39,167,274
2024 222,450 2,201,878 39,446,835
2025 223,313 2,215,490 39,646,907
2026 222,292 2,216,685 39,592,978
________________________
(1) As of January 1.
(2) As of April 1.

Source: State of California, Department of Finance, E-4 Population Estimates for Cities, Counties and State, 2017 -2019, with 2010 Benchmark; E -4 Population Estimates for Cities, Counties and State, 2020-2026, with 2020 Benchmark.

C-2
Employment
The following table summarizes historical employment and unemployment for the City, County, the State of California and the United States for the last five calendar years.

CITY OF SAN BERNARDINO, SAN BERNARDINO COUNTY, CALIFORNIA

AND UNITED STATES
Civilian Labor Force, Employment, and Unemployment
(Annual Averages)
Year and Area Labor Force Employment(2) Unemployment(3) Unemployment
Rate (%)
2021
City of San Bernardino 99,300 90,600 8,700 8.7%
San Bernardino County 991,300 917,200 74,100 7.5
State of California 19,013,800 17,619,300 1,394,500 7.3 United States 161,204,000 152,581,000 8,623,000 5.3

2022
City of San Bernardino 100,000 95,400 4,600 4.6
San Bernardino County 1,001,600 959,600 42,000 4.2
State of California 19,267,400 18,441,400 826,100 4.3
United States 164,287,000 158,291,000 5,996,000 3.6

2023
City of San Bernardino 101,900 96,500 5,300 5.2
San Bernardino County 1,015,000 968,100 46,900 4.6
State of California 19,514,600 18,593,600 921,000 4.7
United States 167,116,000 161,037,000 6,080,000 3.6

2024
City of San Bernardino 102,800 97,000 5,700 5.6
San Bernardino County 1,027,000 947,300 52,700 5.1
State of California 19,692,800 18,650,700 1,042,200 5.3 United States 168,547,000 161,661,000 6,886,000 4.1

2025
City of San Bernardino 104,645 98,427 6,236 6.0
San Bernardino County 1,044,300 988,100 56,300 5.4
State of California 19,823,800 18,738,500 1,085,300 5.5 United States 170,342,000 163,106,000 7,236,000 4.2
______________________
Note: Data is not seasonally adjusted.
(1) Annual averages, unless otherwise specified.
(2) Includes persons involved in labor-management trade disputes. (3) The unemployment rate is computed from unrounded data; therefore, it may differ from rates computed from rounded figures in this table.

Source: U.S. Department of Labor – Bureau of Labor Statistics, California Employment Development Department. March 2024 Benchmark.

C-3
Major Industries in the County
The following table sets out the largest employers in the County:

COUNTY OF SAN BERNARDINO

MAJOR EMPLOYERS
Fiscal Year 2024-25
Rank Name of Business
Approximate No. of San
Bernardino County
Employees(1) Type of Business
1 Loma Linda University Medical Center ≥10,000 Medical Center 2 San Bernardino County ≥10,000 Public Administration
3 Amazon ≥10,000 Electronic Commerce
4 Dignity Health Community Hospital of San Bernardino ≥10,000 Medical Center 5 Ontario International Airport 5,000-9,999 Airport
6 Bear Mountain 1,000-4,999 Ski Resort
7 Burlington Distribution Corp 1,000-4,999 Distribution 8 California State University, San Bernardino 1,000-4,999 Education 9 Environmental Systems Research Institute 1,000-4,999 Research 10 FedEx Ground 1,000-4,999 Postal
________________________
(1) Due to confidentiality of reporting number of employees, ranges have been provided.

Source: San Bernardino County Annual Comprehensive Financial Report for Fiscal Year ended June 30, 2025.

C-4
Residents of the City find employment throughout the Riverside -San Bernardino-Ontario Labor Market Area. This labor market area, as defined for reporting purposes by the California Employment Development Department, has boundaries coterminous with those o f Riverside and San Bernardino Counties. The following table sets forth certain employment data for the Riverside - San Bernardino-Ontario Metropolitan Statistical Area and the County for the period from 2021 through 2025.

RIVERSIDE-SAN BERNARDINO-ONTARIO METROPOLITAN STATISTICAL AREA

INDUSTRY EMPLOYMENT & LABOR FORCE - BY ANNUAL AVERAGE
2021 2022 2023 2024 2025(1)
Civilian Labor Force 2,120,600 2,148,700 2,171,500 2,209,100 2,240,900 Civilian Employment 1,964,300 2,058,400 2,068,800 2,093,800 2,098,500 Civilian Unemployment 156,300 90,200 102,700 115,300 142,400 Civilian Unemployment Rate 7.4% 4.2% 4.7% 5.2% 6.4%

Total Farm 13,700 13,800 13,200 13,700 13,000
Total Nonfarm 1,575,100 1,660,200 1,681,000 1,700,400 1,694,800 Total Private 1,333,100 1,410,200 1,420,700 1,430,200 1,426,800 Goods Producing 207,700 216,300 215,300 212,900 205,800 Mining & Logging 1,400 1,500 1,500 1,600 1,500
Construction 110,100 114,700 115,400 116,200 111,900
Manufacturing 96,100 100,000 98,500 95,200 92,400
Service Providing 1,367,400 1,443,900 1,465,700 1,487,500 1,489,000 Trade, Transportation & Utilities 443,200 464,900 457,900 456,400 450,400 Wholesale Trade 67,400 69,500 68,900 68,600 68,700
Retail Trade 177,000 181,000 183,000 182,600 180,500
Transportation, Warehousing & Utilities 198,800 214,400 206,000 205,200 201,200 Information 12,500 13,000 13,300 13,000 12,800
Financial Activities 45,200 46,000 44,900 44,100 42,700 Professional & Business Services 166,600 173,900 164,400 161,800 160,800 Private Education & Health Services 254,300 267,900 287,800 306,000 320,700 Leisure & Hospitality 160,200 180,900 187,600 185,300 182,700 Other Services 43,600 47,400 49,400 50,700 50,900
Government 242,000 250,000 260,200 270,200 268,000 Total, All Industries 1,588,800 1,674,000 1,694,100 1,714,100 1,707,800 ____________________________
(1) As of July 2025.

Note: Does not include proprietors, self -employed, unpaid volunteers or family workers, domestic workers in households and persons involved in labor-management trade disputes. Employment reported by place of work. Items may not add to total due to independent rounding. The “Total, All Industries” data is not directly comparable to the employment data found in this Appendix E.

Source: State of California, Employment Development Department, March 2024 Benchmark.

C-5
The following tables show the personal income and per capita personal income for the County, State of California and United States from 2015 through 2024.

PERSONAL INCOME
County of San Bernardino, State of California, and United States 2015-2024
Year
County of
San Bernardino California United States
2015 $74,258,677 $2,097,049,575 $15,467,113,000
2016 77,453,102 2,191,138,011 15,884,741,000
2017 80,031,472 2,295,048,653 16,658,962,000
2018 83,514,331 2,411,055,136 17,514,402,000
2019 89,202,022 2,539,747,399 18,349,584,000
2020 99,003,275 2,770,488,779 19,613,059,000
2021 109,157,423 3,019,215,724 21,484,168,000
2022 108,075,879 3,021,645,501 22,144,814,000
2023 111,575,931 3,182,779,295 23,577,208,000
2024 119,551,968 3,400,237,317 24,897,613,000
_____________________________
Note: Dollars in Thousands.
(1) Data not yet available.

Source: U.S. Department of Commerce, Bureau of Economic Analysis.

PER CAPITA PERSONAL INCOME(1)
County of San Bernardino, State of California, and United States 2015-2024
Year
County of
San Bernardino California United States
2015 $35,176 $53,816 $48,062
2016 36,417 55,862 48,974
2017 37,305 58,214 51,006
2018 38,655 60,984 53,311
2019 41,078 64,219 55,567
2020 45,341 70,100 59,151
2021 49,824 77,134 64,692
2022 49,214 77,196 66,298
2023 50,698 81,196 70,002
2024 53,991 86,232 73,204
__________________________
(1) Per capita personal income is the total personal income divided by the total mid -year population estimates of the U.S. Bureau of the Census. All dollar estimates are in current dollars (not adjusted for inflation).

Source: Bureau of Economic Analysis for County, State and U.S.

D-1

APPENDIX D

SUMMARY OF FISCAL AGENT AGREEMENT

E-1

APPENDIX E

FORM OF CONTINUING DISCLOSURE CERTIFICATES OF THE CITY AND THE DEVELOPER

CONTINUING DISCLOSURE CERTIFICATE OF THE CITY
This Continuing Disclosure Certificate, dated as of __________, 2026 (the “Disclosure Certificate”), is executed and delivered by the City of San Bernardino (the “City”) for and on behalf of the Community Facilities District No. 2022 -2 (Palm) in connection with the issuance and delivery of the $__________ Community Facilities District No. 2022-2 (Palm) of the City of San Bernardino 2026 Special Tax Bonds (the “Bonds”). The Bonds are being issued pursuant to that certain Fiscal Agent Agreement, dated as of __________, 2026 (the “Fiscal Agent Agreement”), by and between the City and U.S. Bank Trust Company, National Association , as fiscal agent (the “Fiscal Agent”). The City covenants 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 Owners and Beneficial Owners of the Bonds and in order to assist the Participating Underwriter in complying with the Rule.

SECTION 2. Definitions. In addition to the definitions set forth in the Fiscal Agent Agreement, which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms shall have the following meanings:
“Annual Report” shall mean any Annual Report provided by the City pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate.
“Annual Report Date” means the 1st of April after the end of the City’s fiscal year, commencing April 1, 2027.
“Beneficial Owner” shall mean any person which: (a) has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Bonds (including persons holding Bonds through nominees, depositories or other intermediaries); or (b) is treated as the owner of any Bonds for federal income purposes.
“Disclosure Representative” shall mean the City Manager or the Agency Director of Administrative Services of the City, or their designee, or such other officer or employee as the City shall designate in writing from time to time.
“Dissemination Agent ” shall mean, initially, the City, acting in its capacity as Dissemination Agent hereunder, or any successor Dissemination Agent designated in writing by the City and which has filed with the then current Dissemination Agent a written acceptance of such designation. “Fiscal Year” shall mean the period from July 1 to June 30, or any other period selected by the City as its fiscal year.
“Listed Events” shall mean any of the events listed in Section 5(a) of this Disclosure Certificate. “MSRB” shall mean the Municipal Securities Rulemaking Board, which has been designated by the Securities and Exchange Commission as the sole repository of disclosure information for purposes of the Rule, or any other repository of disclosure information that may be designated by the Securities and Exchange Commission as such for purposes of the Rule in the future. “Official Statement” shall mean the final official statement executed by the City in connection with the issuance of the Bonds.

E-2
“Participating Underwriter” shall mean the original underwriter of the Bonds that is required to comply with the Rule in connection with offering of the Bonds. “Rule” shall mean Rule 15c2 -12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time. “State” shall mean the State of California.

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, 2027, with the report for the 2026-27 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, in an electronic format as prescribe d by the MSRB, a notice in substantially the form attached as Exhibit A to this Disclosure Certificate.
(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 Report . The City’s Annual Report shall contain or include 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:
(i) Principal amount of all outstanding bonds.
(ii) Balance in the Improvement Fund, until such time as the fund is closed.

E-3
(iii) Balance in the Reserve Fund, statement of the Reserve Requirement as of the immediately preceding April 1 and statement of projected draws on the Reserve Fund. (iv) Update of Table 1.
(v) Update of Table 4, using assessed values instead of appraised values (overlapping general obligation debt information needed not be included in the update). (vi) Update of Table 5, using assessed values instead of appraised values (overlapping general obligation debt information needed not be included in the update). (vii) A table showing the total dollar amount of delinquencies and number of delinquent parcels, if any, in the District.
(viii) Notwithstanding the September 30 reporting date, the following information shall be reported as of February 1 immediately preceding the date of the Annual Report rather than as of September 30 :
(x) the identity of each delinquent taxpayer responsible for five percent (5%) or more of total Special Tax levied; (y) the assessor parcel number, assessed value of applicable properties, amount of Special Tax levied, amount delinquent by parcel number and status of foreclosure proceedings; and (z) if any foreclosure has been completed, a summary of results of foreclosure sales or transfers. (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.

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:
(i) Principal and interest payment delinquencies.
(ii) Non-payment related defaults, if material.
(iii) Unscheduled draws on debt service reserves reflecting financial difficulties. (iv) Unscheduled draws on credit enhancements reflecting financial difficulties. (v) Substitution of credit or liquidity providers, or their failure to perform. (vi) 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.
(vii) Modifications to rights of security holders, if material. (viii) Bond calls, if material, and tender offers.

E-4
(ix) Defeasances.
(x) Release, substitution, or sale of property securing repayment of the securities, if material. (xi) Rating changes.
(xii) Bankruptcy, insolvency, receivership or similar event of the City or other obligated person.
(xiii) 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. (xiv) Appointment of a successor or additional fiscal agent or the change of name of the fiscal agent, if material.
(xv) 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)). (xvi) 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 a Listed Event described in subsection (a)(viii) 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)(ii), (a)(vii), (a)(viii) (if the event is a bond call), (a)(x), (a)(xiii), (a)(xiv) and (a)(xv) of this Section 5 contain the qualifier “if material” and that subparagraph (a)(xi) 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 e vent’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 eve nt described in paragraph (a)(xii ) 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 b y 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 cou rt or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the City.

E-5
(e) For purposes of Section 5(a)(xv) and (xvi), “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).

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 amend ments 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 r ecognized 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).

E-6
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 infor mation in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the City chooses to include any information in any Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the City shall have no obligation under this Disclosure Certificate to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event.

SECTION 11. 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 per formance 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 lia bilities 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 an y 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.

CITY OF SAN BERNARDINO , for and on behalf of
COMMUNITY FACILITIES DISTRICT NO. 2022 -2
(PALM) OF THE CITY OF SAN BERNARDINO ,

COUNTY OF SAN BERNARDINO , STATE OF

CALIFORNIA
By:

City Manager

E-7

EXHIBIT A

NOTICE TO REPOSITORIES OF FAILURE TO FILE ANNUAL REPORT Name of Issuer: City of San Bernardino
Name of Bond Issue: $_______ Community Facilities District No. 2022-2 (Palm) of the City of San Bernardino 2026 Special Tax Bonds
Date of Issuance: _____________, 2026
NOTICE IS HEREBY GIVEN that the City of San Bernardino (the “City”) on behalf of Community Facilities District No. 2022-2 (Palm) of the City of San Bernardino has not provided an Annual Report with respect to the above-named Bonds as required by that certain Fiscal Agent Agreement dated as of ______, 2026, by and between the City and U.S. Bank Trust Company, National Association, as Fiscal Agent. The City anticipates that the Annual Report will be filed by __________, 20__.

Dated:

CITY OF SAN BERNARDINO, for and on behalf of
COMMUNITY FACILITIES DISTRICT NO. 2022 -2
(PALM) OF THE CITY OF SAN BERNARDINO ,

COUNTY OF SAN BERNARDINO , STATE OF

CALIFORNIA
By:

City Manager

E-8

FORM OF CONTINUING DISCLOSURE CERTIFICATES OF THE CITY AND THE DEVELOPER

CONTINUING DISCLOSURE CERTIFICATE OF THE DEVELOPER
This Continuing Disclosure Certificate of the Developer (this “Disclosure Certificate ”), dated as of __________, 2026, is executed and delivered by Richmond American Homes of Maryland, Inc. (the “Developer”) in connection with the issuance of the District’s $__________ Community Facilities District No. 2022-2 (Palm) of the City of San Bernardino 2026 Special Tax Bonds (the “Bonds”). The Bonds are being issued pursuant to that certain Fiscal Agent Agreement dated as of __________, 2026 (the “Fiscal Agent Agreement”) by and between the City of San Bernardino (the “City”) and U.S. Bank Trust Company, Nationa l Association, as fiscal agent (the “Fiscal Agent”). The Developer covenants and agrees as follows:

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

SECTION 2. Definitions. In addition to the definitions set forth 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 Developer, 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 Developer’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 the property in the District acquired by the Major Owner), whereby such Major Owner agrees to provide semi -annual 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 the District owned by such Major Owner and, at the option of the Developer or such Major Owner, agrees to indemnify the Dissemination Agent (if any) pursuant to a provision substantially in the form of Section 12 hereof.
“Dissemination Agent” means the Developer, or any successor Dissemination Agent designated in writing by the Developer, which is experienced in providing dissemination agent services such as those required under this Disclosure Certificate, and which has filed with the Developer, the District and the Participating Underwriter, a written acceptance of such designation and acceptance. “District” means Community Facilities District No. 2022-2 (Palm) of the City of San Bernardino, County of San Bernardino, State of California.
“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, together with the Person ’s Affiliates, owns 20% or more of the property subject to the Special Tax. “MSRB” means the Municipal Securities Rulemaking Board, which has been designated by the Securities and Exchange Commission as the sole repository of disclosure information. “Official Statement” means the Official Statement dated ___________, 2026, executed by the City in connection with the issuance of the Bonds.

E-9
“Participating Underwriter” means Hilltop Securities Inc., the original underwriter of the Bonds. “Property” means (i) the property owned by the Developer or an Affiliate in the District and subject to the Special Taxes as of the date of determination , and (ii) the property in the District that the Developer or an Affiliate sold to a Major Owner who has not assumed the undertakings of this Disclosure Certificate under Section 7(b) that is owned by such Major Owner as of the date of determination. “Report Date” means (a) April 1 of each year, and (b) September 30 of each year. “Semi-Annual Report” means any Semi -Annual Report provided by the Developer pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate. “Special Taxes” means the special taxes levied by the District on the Property.

SECTION 3. Provision of Semi-Annual Reports.
(a) Until such obligations are terminated pursuant to Section 7 herein, the Developer shall, or upon written direction of the Developer the Dissemination Agent shall, not later than the Report Date, commencing September 30, 2026, provide to the MSRB, in an electronic format as prescribed by the MSRB, a Semi -Annual Report which is consistent with the requirements of Section 4 of this Disclosure Certificate. Not later than 15 calendar days prior to the Report Date, the Developer shall provide the Semi-Annual Report to the Dissemination Agent (if different from the Developer). The Developer shall provide a written certification with (or included as a part of) each Semi-Annual Report furnished to the Dissemination Agent (if different from the Developer), to the effect that such Semi-Annual Report constitutes the Semi-Annual Report required to be furnished by it under this Disclosure Certificate. The Dissemination Agent may conclusively rely upon such certification of the Developer and shall have no duty or obliga tion to review the Semi -Annual Report. The Semi -Annual 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 is not the Developer and it does not receive a Semi-Annual Report by 15 calendar days prior to the Report Date, the Dissemination Agent shall send a reminder notice to the Developer that the Semi -Annual Report has not been provid ed as required under Section 3(a) above. The reminder notice shall instruct the Developer to determine whether its obligations under this Disclosure Certificate have terminated (pursuant to Section 7 below) and, if so, to provide the Dissemination Agent with a notice of such termination in the same manner as for a Listed Event (pursuant to Section 5 below). If the Developer does not provide, or cause the Dissemination Agent to provide, a Semi -Annual Report to the MSRB by the Report Date, as required in subsection (a) above, the Dissemination Agent shall send a notice in a timely manner to the MSRB in substantially the form attached hereto as Exhibit A, with a copy to the District 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 Semi -Annual Report has been furnished to it, file a report with the Developer (if the Dissemination Agent is other than the Developer), the District, and the Participating Underwriter certifying that the Semi -Annual Report has been provided pursuant to this Disclosure Certificate, and stating the date it was provided to and filed with the MSRB.

SECTION 4. Content of Semi-Annual Reports. Each Semi-Annual Report shall contain or incorporate by reference the information set forth in Exhibit B, any or all of which may be included by specific reference to other documents which are available to the public on the MSRB ’s internet website or filed with the Securities and Exchange Commission. The Developer shall clearly identify each such other document so included by reference.

E-10
In addition to any of the information expressly required to be provided in Exhibit B, each Semi-Annual 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) Until such obligations are terminated pursuant to Section 7 herein, the Developer shall give, or cause to be given, notice of the occurrence of any of the following Listed Events with respect to itself or the Property, if material:
(i) bankruptcy or insolvency proceedings commenced by or against the Developer and, if known, any bankruptcy or insolvency proceedings commenced by or against any Affiliate of the Developer that is reasonably likely to have a significant impact on the Developer’s ability to develop the Property as described in the Official Statement or a more recently filed Semi -Annual Report or to pay Special Taxes due with respect to the Property (to the extent the responsibility of the Developer) prior to delinquency;
(ii) failure of the Developer to pay any taxes, special taxes (including the Special Taxes) or assessments due with respect to the Property on or prior to the delinquency date, to the extent such failure is not promptly cured by the Developer upon discovery thereof; (iii) filing of a lawsuit against the Developer or, if known, an Affiliate of the Developer, seeking damages which, if successful, could have a material and adverse impact on the Developer’s ability to develop the Property as described in the Official Statement or a more recently filed Semi-Annual Report or to pay Special Taxes due with respect to the Property prior to delinquency; (iv) material damage to or destruction of any of the improvements on the Property; and (v) any payment default or other material default by the Developer that continues to exist beyond any applicable notice and cure periods on any loan with respect to the construction of improvements on the Property that would have a material adverse effect on the Developer’s most recently disclosed development plan or financing with respect to the Property, or the ability of the Developer to pay its Special Taxes prior to delinquency.
(b) Whenever the Developer obtains knowledge of the occurrence of a Listed Event, the Developer shall as soon as possible determine if such event would be material under applicable Federal securities law. (c) If the Developer determines that knowledge of the occurrence of a Listed Event would be material under applicable Federal securities law, the Developer shall, or shall cause the Dissemination Agent to, within 10 business days after obtaining knowledge of the Listed Event, file a notice of such occurrence of the Listed Event with the MSRB, in an electronic format as prescribed by the MSRB, with a copy to the District and the Participating Underwriter.

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

SECTION 7. Duration of Reporting Obligation.
(a) All of the Developer’s obligations hereunder shall commence on the date hereof and shall terminate (except as provided in Section 12) on the earliest to occur of the following:
(i) upon the legal defeasance, prior redemption or payment in full of all the Bonds, or

E-11
(ii) at such time as (A) the Developer is no longer a Major Owner and (B) the Developer no longer has any obligations under this Disclosure Certificate with respect to any Major Owner as a result of such obligations having been assumed under one or more Assumption Agreements entered into pursuant to Section 7(b) below; or
(iii) the date on which the Developer and all Affiliates, collectively own all or a portion of the Property that represents less than 20% of the aggregate special tax obligation; or (iv) the date on which all of the Special Taxes attributable to the Property are paid in full.

The Developer shall give notice of the termination of its obligations under this Disclosure Certificate in the same manner as for a Listed Event under Section 5.
(b) If a portion of the Property is conveyed to a person or entity that, upon such conveyance, will be a Major Owner, the obligations of the Developer hereunder with respect to the property conveyed to such Major Owner shall be assumed by such Major Owner, and if so assumed the Developer’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 substantially similar to this Disclosure Certificate. A Major Owner, however, 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 Semi-Annual Reports. If not so assumed, the Developer shall use commercially reasonable efforts to report the information, as applicable to the transferee, required herein so long as the transferee is a Major Owner.

SECTION 8. Dissemination Agent . The Developer may, from time to time, appoint or engage a Dissemination Agent to assist the Developer in carrying out its obligations under this Disclosure Certificate, and may discharge any such Dissemination Agent with or without appointing a successor D issemination Agent. The initial Dissemination Agent shall be the Developer. The Dissemination Agent may resign by providing 30 days’ written notice to the Developer.

SECTION 9. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate, the Developer 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 th at 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, or change in law; 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 10. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the Developer from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Semi - Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the Developer chooses to include any information in any Semi -Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the Developer shall have no obligation under this Disclosure Certificate to update such information or include it in any future Semi-Annual Report or notice of occurrence of a Listed Event.

E-12
SECTION 11. Default. In the event of a failure of the Developer to comply with any provision of this Disclosure Certificate, the Participating Underwriter, the District, and any holder or beneficial owner of the Bonds may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Developer to comply with its obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not be deemed an Event of Default under the Fiscal Agent Agreement, and the sole remedy under this Disclosure Certificate in the event of any failure of the Developer to comply with this Disclosure Certificate shall be an action to compel performance.

SECTION 12. Duties, Immunities and Liabilities of Dissemination Agent. The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate, and the Developer agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents (each, an “Indemnified Party”), harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the reasonable costs and expenses (including attorneys’ fees) of defending against any claim of liability, but excluding any loss, expense and liabilities due to an Indemnified Party’s negligence or willful misconduct or failure to perform its duties hereunder. If th e Dissemination Agent is not the Developer, the Dissemination Agent shall be paid compensation for its services provided hereunder from the Administrative Expense Fund established under the Fiscal Agent Agreement 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 District, the Developer, the Participating Underwriter, the Bond owners, or any other party. The obligations of the Developer under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds.

SECTION 13. Notices. Any notice or communications to be among any of the parties to the Disclosure Certificate may be given by regular, overnight, or electronic mail as follows:

To the Issuer: City of San Bernardino
290 North “D” Street
San Bernardino, CA 92401
Attn: City Manager

To the Participating Underwriter: Hilltop Securities Inc. 2533 South Coast Highway 101, Suite 250
Cardiff, CA 92007
Attn: Mike Cavanaugh, Managing Director
Email: [email protected]
To the Developer: [TBD]

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.

SECTION 14. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the District, the Developer (its successors and assigns), the Dissemination Agent, the Participating Underwriter and holders and beneficial owners from time to time of the Bonds, and shall create no rights in any other person or entity. All obligations of the Developer hereunder shall be assumed by any legal successor to the obligations of the Developer as a result of a sale, merger, consolidation or other reorganization. (Signature page follows)

E-13
IN WITNESS WHEREOF, the Developer has executed this Disclosure Certificate as of the date first above written.

DEVELOPER:

RICHMOND AMERICAN HOMES OF MARYLAND, INC.

By ___________________________________
Authorized Signatory

-Signature Page-
Continuing Disclosure Certificate

E-14

EXHIBIT A

NOTICE TO REPOSITORIES OF FAILURE TO FILE PERIODIC REPORT

Name of Issuer: Community Facilities District No. 2022 -2 (Palm) of the City of San Bernardino, County of San Bernardino, State of California
Name of Bond Issue: $______ Community Facilities District No. 2022 -2 (Palm) of the City of San Bernardino, 2026 Special Tax Bonds
Date of Issuance: ____________, 2026
NOTICE IS HEREBY GIVEN that Richmond American Homes of Maryland, Inc. (the “Developer”), has not provided a Semi -Annual Report with respect to the above -named Bonds as required by the Disclosure Certificate. The Developer anticipates that the applicable Semi-Annual Report will be filed by _____________, 20__.

Dated: _______________
Dissemination Agent

By: __________________________________
Its: __________________________________
cc: Developer
District
Participating Underwriter

E-15

EXHIBIT B

SEMI-ANNUAL REPORT
APRIL 1, ____/ SEPTEMBER 30, ____
COMMUNITY FACILITIES DISTRICT NO. 2022-2
(PALM) OF THE CITY OF SAN BERNARDINO
OF 2026 SPECIAL TAX BONDS
This Semi-Annual Report is hereby submitted under Section 4 of the Continuing Disclosure Certificate of the Developer (the “Disclosure Certificate”) dated as of __________, 2026, executed by the undersigned (the “Developer”) in connection with the issuance by the City of San Bernardino (the “City”) of the bonds captioned above (the “Bonds”) for Community Facilities District No. 2022 -2 (Palm) of the City of San Bernardino (the “District”).

Capitalized terms used in this Semi-Annual 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 __________ , 20__ (this date must be not more than 60 days before the Report Date of this Semi-Annual Report).

A. Description of the Property currently owned by the Developer in the District (the “Property”) in substance and form similar to such information in the Official Statement for the Bonds under the caption “THE DISTRICT—The Development ” or the Semi -Annual Report last filed in accordance with the Disclosure Certificate.

B. Updated information regarding home construction activities with respect to the Property described in the Official Statement for the Bonds under the caption “THE DISTRICT—The Development” or the Semi-Annual Report last filed in accordance with the Disclosure Certificate.

II. Legal and Financial Status of Developer
Unless such information has previously been included or incorporated by reference in a Semi -Annual Report, describe any material change in the legal structure of the Developer or the financial condition and financing plan of the Developer that would materi ally and adversely interfere with its ability to complete its development plan described in the Official Statement. To the extent that the ownership of the Developer 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 Semi -Annual Report, describe any development plans or financing plans relating to the Property that are materially different from the proposed development and financing plan described in the Official Statement.

E-16
IV. Status of Tax Payments
Describe status of payment of taxes, special taxes (including the Special Taxes) or assessments due with respect to the Property owned by the Developer and its Affiliates.

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

Certification
On behalf of the Developer, the undersigned officer or representative, based on actual knowledge after reasonable inquiry of employees of Developer and its Affiliates, hereby certifies that this Semi -Annual Report constitutes the Semi-Annual Report required to be furnished by the Developer under the Disclosure Certificate.

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

STATEMENTS MADE BY THE DEVELOPER IN AN OFFICIAL RELEASE, OR FILED WITH THE MUNICIPAL SECURITIES RULEMAKING BOAR D, ARE NOT AUTHORIZED BY THE DEVELOPER.

THE DEVELOPER IS NOT RESPONSIBLE FOR THE ACCURACY, COMPLETENESS OR FAIRNESS OF ANY SUCH UNAUTHORIZED STATEMENTS.

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

E-17

Dated:

DEVELOPER:

RICHMOND AMERICAN HOMES OF MARYLAND, INC.

By ___________________________________
Authorized Signatory

F-1

APPENDIX F

PROPOSED FORM OF BOND COUNSEL OPINION
____________, 2026
City Council
City of San Bernardino
290 North “D” Street
San Bernardino, CA 92401
Re: $______ Community Facilities District No. 2022 -2 (Palm) of the City of San Bernardino 2026 Special Tax Bonds
Ladies and Gentlemen:

We have acted as bond counsel in connection with the issuance by the City of San Bernardino (the “City”) for and on behalf of Community Facilities District No. 2022-2 (Palm) of the City of San Bernardino, County of San Bernardino, State of Ca lifornia (the “District”), of $ _____ aggregate principal amount of the Community Facilities District No. 2022-2 (Palm) of the City of San Bernardino 2026 Special Tax Bonds (the “Bonds”). The Bonds are issued pursuant to the provisions of the Mello -Roos Community Facilities Act of 1982, as amended, being Chapter 2.5 (commencing with Section 53311) of Part 1 of Division 2 of Title 5 of the Government Code of the State of California (the “Act”), a resolution adopted by the City Council of the City on _______, 2026 (the “Resolution”), and that certain Fiscal Agent Agreement, dated as of __________, 2026 (the “Agreement”), by and between the City and U.S. Bank Trust Company, National Association, as fiscal agent (the “Fiscal Agent”).

In such connection, we have examined the Act, the Resolution, the Agreement, the Tax Certificate related to the Bonds, and certified copies of the proceedings taken for the issuance and sale of the Bonds. As to questions of fact which are material to our o pinions, we have relied upon the representations of the City contained in the Agreement, and in certificates of its authorized officers which have been delivered to us for the purpose of supplying such facts, without having undertaken to verify the accuracy of any such representations by independent investigation.

The opinions expressed herein are based on an analysis of existing laws, regulations, rulings and court decisions and cover certain matters not directly addressed by such authorities. Such opinions may be affected by actions taken or omitted or events occ urring after the date hereof. We have not undertaken to determine, or to inform any person, whether any such actions are taken or omitted or events do occur or any other events come to our attention after the date hereof. Accordingly, this opinion speaks only as of its date and is not intended to, and may not, be relied upon in connection with any such actions, events or matters. Our engagement with respect to the Bonds has concluded with their issuance, and we disclaim any obligation to update this letter.

We have assumed the genuineness of all documents and signatures presented to us (whether as originals or as copies) and the due and legal execution and delivery thereof by, and validity against, any parties other than the City. We have assumed, without un dertaking to verify, the accuracy of the factual matters represented, warranted or certified in the documents, and of the legal conclusions contained in the opinions, referred to in the second paragraph hereof. Furthermore, we have assumed compliance with all covenants and agreements contained in the Agreement and the Tax Certificate, including (without limitation) covenants and agreements compliance with which is necessary to ensure that future actions, omissions or events will not cause interest on the Bonds to be included in gross income for federal income tax purposes. We call attention to the fact that the rights and obligations under the Bonds, the Resolution, the Agreement and the Tax Certificate and their

F-2
enforceability may be subject to bankruptcy, insolvency, reorganization, arrangement, fraudulent conveyance, moratorium and other laws relating to or affecting creditors’ rights, to the application of equitable principles, to the exercise of judicial discretion in appropriate cases, and to the limitations on legal remedies against cities and their subordinate entities in the State of California. We express no opinion with respect to any indemnification, contribution, penalty, choice of law, choice of forum, choice of venue, waiver or severability provisions contained in the documents mentioned in the preceding sentence. Finally, we undertake no responsibility for the accuracy, completeness or fairness of the Official Statement or other offering materials relating to the Bonds and express no opinion with respect thereto.

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

1. The Bonds have been duly and validly authorized by the City, for and on behalf of the District, and are legal, valid, and binding special obligations of the City. The Bonds are secured and payable solely from sources provided therefor in the Agreement.

2. The Agreement has been duly authorized by the City, on behalf of the District, and constitutes the valid and legally binding obligation of the City enforceable against the City in accordance with its terms, as such enforcement may be limited by bankruptcy , insolvency, moratorium, transfer or conveyance or other laws affecting creditors’ rights generally, or by the exercise of judicial discretion in accordance with general principles of equity or otherwise in appropriate cases; provided, however, that we express no opinion with respect to any indemnification, contribution, choice of law or waiver provisions contained therein.

3. The Agreement creates a valid pledge of that which the Agreement purports to pledge, subject to the provisions of the Agreement, except to the extent that the enforceability of the Agreement may be limited by moratorium, bankruptcy, reorganization, fraudu lent conveyance or transfer, insolvency or other laws affecting creditors’ rights generally, or by the exercise of judicial discretion in accordance with general principles of equity or otherwise in appropriate cases.

4. Under existing statutes, regulations, rulings and court decisions, the interest on the Bonds is excluded from gross income for purposes of federal income taxation. Interest on the Bonds is not a specific preference item for purposes of the federal altern ative minimum tax imposed on individuals and corporations, however, interest on the Bonds is taken into account in determining the annual adjusted financial statement income of certain corporations for the purpose of computing the alternative minimum tax imposed on certain corporations.

Although the interest on the Bonds is excluded from gross income for purposes of federal income taxation, the accrual or receipt of interest on the Bonds, or any portion thereof, may otherwise affect the federal income ta x liability of the recipient. The extent of these other tax consequences will depend on the recipient’s particular tax status or other items of income or deduction. We express no opinion regarding any such consequences.

5. Interest on the Bonds is exempt from State of California personal income tax.

Although interest on the Bonds is excluded from gross income for purposes of federal income taxation, the accrual or receipt of interest on the Bonds may otherwise affect the federal income tax liability of the recipient.

The extent of these tax consequences will depend on the recipient’s particular tax status or other items of income or deduction. We express no opinion regarding any such consequences.

Respectfully submitted,

G-1

APPENDIX G

INFORMATION CONCERNING DTC
The information in this section concerning DTC and DTC ’s book-entry only system has been obtained from sources that the City believes to be reliable, but the City takes no responsibility for the completeness or accuracy thereof. The following description of the procedures and record keeping with respect to beneficial ownership interests in the Bonds, payment of principal, premium, if any, accreted value and interest on the Bonds to DTC Participants or Beneficial Owners, confirmation and transfers of beneficial ownership interests in the Bonds and other related transactions by and between DTC, the DTC Participants and the Beneficial Owners is based solely on information provided by DTC to the City which the City believes to be reliable, but the City and the Underwriter do not and cannot make any independent representations concerning these matters and do not take responsibility for the accuracy or completeness thereof. Neither the DTC, Direct Participants, Indirect 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.

The Depository Trust Company (“DTC”), New York, New York, will act as securities depository for the Bonds. The Bonds will be issued as fully -registered securities regis tered 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 Bond will be issued for each annual maturity of the Bonds, each in the aggregate principal amount of such maturity, and will be deposited through the facilities of DTC.

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 3.6 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 electr onic 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 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 t o its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com.

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

G-2
To facilitate subsequent transfers, all Bonds deposited by Direct Participants with DTC are registered in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of Bonds with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not affect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Bonds; DTC ’s records reflect only the identity of the Direc t Participants to whose accounts such Bonds are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers.

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

Redemption notices shall be sent to DTC. If less than all of the Bonds within a maturity are being prepaid, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in such maturity to be redeemed.

Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Bonds unless authorized by a Direct Participant in accordance with DTC’s MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the City as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to whose accounts Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy).

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

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

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

G-3
The City may decide to discontinue use of the system of book -entry only transfers through DTC (or a successor securities depository). In that event, Bonds will be printed and delivered to DTC.

THE FISCAL AGENT , AS LONG AS A BOOK -ENTRY ONLY SYSTEM IS USED FOR THE

BONDS, WILL SEND ANY NOTICE OF REDEMPTION OR OTHER NOTICES TO OWNERS ONLY TO DTC. ANY FAILURE OF DTC TO ADVISE ANY DTC PARTICIPANT, OR OF ANY DTC PARTICIPANT

TO NOTIFY ANY BENEFICIAL OWNER, OF ANY NOTICE AND ITS CONTENT OR EFFECT WILL NOT

AFFECT THE VALIDITY OF SUFFICIENCY OF THE PROCEEDINGS RELATING TO THE REDEMPTION

OF THE BONDS CALLED FOR REDEMPTION OR OF ANY OTHER ACTION PREMISED ON SUCH NOTICE.

Mayor and City CouncilJune 17, 2026

Mayor and City Council
June 17, 2026